Friday Five | May 26, 2023
A recap of this week’s top-five news items and resources from the intersection of business and government.
1. Moore issues first vetoes, lets cannabis search bill and others become law without his signature
Governor Moore last Friday issued the first vetoes of his administration while also allowing 10 bills to become law without his signature – including a measure that addresses traffic stops when the odor of cannabis is present and fines for smoking marijuana in public.
“This is the last action” by the governor on bills passed during the recent General Assembly session, according to a spokesperson for Moore, Carter Elliott IV.
Only one of the governor’s three vetoes actually sends a piece of legislation back to the drawing board; the other two were versions of bills he had previously signed, meaning “it is not necessary for me to sign” the companion legislation, Moore said in veto messages to legislative leaders.
The cannabis bill, sponsored by Del. Charlotte Crutchfield, prohibits a law enforcement officer from stopping and searching a vehicle or motorist solely on the basis of cannabis odor while placing restrictions on searches. The bill also addresses fines for possession of marijuana.
2. Maryland’s Flying Dog Brewery to be acquired by NY-based brewing company, ending most production in Frederick
Flying Dog Brewery, based in Frederick, will be acquired by New York-based FX Matt Brewing Co., which will take over production of Flying Dog beer by August.
FX Matt, a family-owned brewery founded in 1888, is looking for a location in Frederick to open a Flying Dog taproom, which would include an “innovation” brewery, the companies said in a joint announcement Monday.
Despite investing millions of dollars in its Frederick brewery, the brand has been unable to take itself to the next level to stay competitive, Flying Dog CEO Jim Caruso said in Monday’s announcement. The brewery has “too many limitations [that put] Flying Dog at too great a competitive disadvantage,” Caruso said in a news release.
Flying Dog, the state’s largest producer of craft beer, had put major expansion plans on hold in 2017 because of legislation regarding state brewery regulations, Caruso said at the time. The brewing company had bought nearly 32 acres of farmland near Frederick Municipal Airport for $2.55 million to establish a brewery five times the size of its current 50,000-square-foot facility.
3. What a federal debt default could mean for Marylanders: Recession, unpaid workers, loss of benefits
Thousands of Marylanders could be out of a paycheck or benefits if federal leaders fail to reach an agreement to increase the nation’s debt ceiling.
With less than a week before the so-called X Date, lawmakers from both parties are negotiating to avoid defaulting on debt payments. Economists and state leaders warn of unpleasant short-term effects that could become painful in the long-run if negotiations stall.
“A congressional failure to reach an agreement on the debt ceiling would, at the very least, send negative ripples throughout Maryland’s economy – and possibly far worse,” said Comptroller Brooke Lierman.
“Even a short-term breach of the debt ceiling could trigger a recession, while a long-term breach would entail a Great Recession-type scenario, with unemployment rates potentially doubling and long-term damage to our economy,” she said.
A final agreement that avoids a default may still have an effect on the state’s finances. Senate Budget and Taxation Chair Sen. Guy Guzzone said a resolution could look more like 2011 when the debt ceiling debate led to a retrenchment of federal spending. Under what was called sequestration, federal spending did not return to fiscal 2012 levels until 2018.
4. Baltimore named a ‘Workforce Hub’ by Biden administration
Baltimore is one of five U. S. cities that have been named “Workforce Hubs,” under a new federal initiative aimed at matching more Americans with “good jobs and careers.”
The program, announced by First Lady Jill Biden last week, is part of an effort by the Biden administration to ensure that all Americans can access the jobs created by its “Investing in America” agenda, designed to jumpstart the economy as the country recovers from the COVID-19 pandemic. It’s scheduled to start this summer.
In a fact sheet on the White House website, the administration said it will work with local officials and others in the five hubs to train and connect Americans with jobs created by the passage of four laws that are pumping billions of dollars into the economy: the American Rescue Plan; the Bipartisan Infrastructure Law; the CHIPS and Science Act and the Inflation Reduction Act.
Baltimore was chosen, officials said, largely because of its location on the East Coast and along the country’s busy Northeast rail corridor.
5. Survey of economists: Inflation, Fed’s key interest rate both will stay high
The Federal Reserve will make only modest progress in its fight against inflation for the rest of this year, even while keeping its benchmark interest rate at a 16-year high, a group of business economists predict in a survey released Monday.
The National Association for Business Economics’ survey of 45 economists found that the median forecast is for inflation to average 4.2% this year, up from a 3.9% forecast in the group’s previous survey in February. That is far above the Fed’s inflation target of 2%.
The findings reflect a survey of economists from businesses, trade associations and academia.
