Jul. 14--A new report that shows Maryland ranks 17th in economic performance and 28th in economic outlook has drawn diverse reactions.

The report, from the American Legislative Exchange Council, was co-authored by economist Arthur B. Laffer.

It is based on three major factors, personal income per capita, domestic migration and non-farm payroll employment.

While Maryland did well in those areas, the "negative" aspects of the criteria pulled the ranking down. Factors such as the state's estate and inheritance tax, its right-to-work status and personal income rate were seen as obstacles to economic progress.

Among bordering states, Virginia's economic outlook ranks fourth nationally, Delaware ranks 31st, West Virginia ranks 33rd, and Pennsylvania ranks 42nd.

"My observation on the ALEC report is that were it not for the tax increases passed during the special session of 2007, I suspect the situation would be much better for Maryland overall," said Delegate Rick Weldon, an unaffiliated Frederick lawmaker.

"Those tax increases fueled an increase in spending that was simply unsustainable, particularly in light of the economic collapse of 2008," Weldon said. "Additionally, the majority party's refusal to even allow a debate on the death tax is a contributor to our ranking of 28th in competitiveness."

In 2008, according to the ALEC report, Maryland ranked 32nd in economic outlook and 12th in performance.

Weldon was skeptical that the state ranks 17th in overall economic status.

"That number is a little misleading," he said. "With so many of our residents working for the federal government, not in the private sector, it provides a confused picture about our state's economic health."

Sen. David Brinkley, a Frederick County Republican, agreed. "We are dependent on federal spending rather than helping local entrepreneurs," the senator said.

Brinkley said the state decoupled itself from a federal estate tax, but still hits Maryland residents with the inheritance costs.

"It's what happens when you have people who are not business people making decisions that impact business," Brinkley said.

But Delegate Galen Clagett, a Democrat, countered that Maryland is doing well economically and statistics can be used in many ways.

"There's an old saying that figures lie and liars figure," Clagett said.

Clagett pointed to the state's AAA bond rating, high per capita personal income, and "we are in the top three in the nation in biotech."

Clagett said the report should have looked at states similar to Maryland for a true comparison.

"That could put a totally different picture on it," he said.

Higher taxes are part of Maryland's better system of education and quality of life. "Taxes are related to services, and people want services," Clagett said.

Clagett said a lot of groups put out a lot of reports, often focusing on one area, such as taxes.

"It's not that simple," he said.

According to the Maryland Department of Business and Economic Development, there are 5,970 businesses in Frederick County, employing 80,500 people. Statewide, 167,800 businesses have more than 2 million employees.

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