Biz Roundup

Columbia Tower Developer Files for Bankruptcy Protection
WCI Communities of Florida, the developer of the 23-story Plaza Residences tower planned for Columbia Town Center, has filed for Chapter 11 bankruptcy protection, along with approximately 130 of its subsidiaries. WCI CEO Jerry Starkey stepped down on Aug. 4 and was replaced on an interim basis by President and CEO David Fry, pending selection of a permanent CEO.
A U.S. Bankruptcy Court in Wilmington, Del., approved a relief package designed to facilitate and ensure the continued and uninterrupted operation of WCI's business. The court also determined that deposits and other funds received and held in trust were not subject to the bankruptcy.
In the case of the Plaza Residences, however, WCI returned deposits to reservation holders in February and extended a promise to keep their reservations intact.
Carl Icahn, chair of WCI's board of directors, said the company attempted "with all diligence" to avoid bankruptcy. "The filing became necessary because of the recent failed effort to obtain financing" of the company's debt, which was followed by rejection of an exchange offer by certain holders of the company's $125 million convertible notes who demanded payment in full (in cash) on Aug. 5.
"WCI still believes in the [Plaza Residences] project and will continue to pursue its rights so it can build the project when the market is more favorable," said WCI Spokesperson Sandy Sternberg. She added that the company is also reserving its rights in light of a July decision by the Maryland Court of Special Appeals that grants Columbia resident Joel Broida legal standing to challenge the project.

Magna Extends Debt Payment, Maryland Jockey Club Slashes Schedule
The Maryland Jockey Club (MJC) and Maryland Thoroughbred Horsemen's Association have agreed to slash the stakes schedule, including the Grade I Frank J. De Francis Dash, for the 2008 fall racing campaign at Laurel Park as the industry faces a shortfall in the purse account by the end of the calendar year.
The only stakes races on the calendar will be state-bred or state sired stakes, headlined by the 23rd running of the Maryland Million on Saturday, Oct. 4.
"This is terribly disappointing, but these are serious times," said Tom Chuckas, president and COO of the MJC. "We remain hopeful that the playing field between Maryland and our neighbors to the west, north and east will be leveled and that we will be able to resume running this prominent race in the future."
Magna Entertainment Corp. (MEC), which owns Laurel Park and Pimlico Race Course, also announced in August that it has again amended several financing agreements. This includes extending the maturity date of a $40 million line of credit with a Canadian chartered bank from Aug. 15 to Sept. 15, 2008; extending the maturity date of a bridge loan with a subsidiary of MI Developments, MEC's controlling shareholder, from Aug. 31 to Sept. 30, 2008; and extending the due date of its $100 million repayment requirement under the Gulfstream Park project financing with the MID Lender from Aug. 31 to Sept. 30, 2008, during which time any repayments will not be subject to a make-whole payment.
According to a company release, MEC incurred a fee of $0.4 million in connection with the extension of the senior bank facility and a fee of $0.5 million in connection with the extension of the bridge loan.

Maryland Opens First International Trade Office in South Korea
Gov. Martin O'Malley has announced that the state of Maryland will open an office in Seoul, South Korea, this fall. It will be Maryland's sixth foreign office and will be run by Ellicott City-based IDI Corp.
The new office will be the state's first in a foreign country to operate entirely on a contingency basis. Any funding that would come from the state would be based solely on IDI Corp.'s ability to attract South Korean companies and jobs to Maryland.
"Maryland and South Korea are leaders in many of the same key industries," said O'Malley. "Opening an office in South Korea presents a golden opportunity for Maryland to tap into the tremendous potential for partnerships with companies there, as well as encourage South Korean companies to take a closer look at Maryland."
According to recent data, Maryland's exports to South Korea were $181 million in 2007, making the country Maryland's 14th largest trading partner. As of May 2008, Maryland exports to South Korea were already approaching $94 million, a 65% increase over the previous year. In turn, South Korean imports to Maryland topped $1.1 billion last year, the majority of which were vehicles.
In 2007, total exports from Maryland rose to a record high of $8.9 billion, an almost 18% increase from $7.6 billion in 2006.

BRTB Seeks Input on Amendments to Long-Range Transportation Plan
After recent legislation targeted the Baltimore Regional Transportation Board (BRTB) with nearly $340 million in revenue enhancements during the next 20 years, the organization followed that announcement with the release of "Transportation Outlook 2035," the region's long-range transportation plan.
But in response to public input and amid concerns about escalating costs, the BRTB has determined that additional funds for capital expansion should be directed toward a combination of short- and long-term transit projects.
"Our transportation network is a crucial element in our region's quality of life," said Howard County Executive Ken Ulman, the BRTB chair. "Our citizens feel the pinch at the gas pump, and suffer the consequences of increasing traffic congestion. There is growing concern about dependence on fossil fuels and the emissions that contribute to air pollution. It only makes sense to give citizens an opportunity to share not only their concerns, but their suggestions for improving our transportation network, at the beginning of the process."
The public input period closed on Sept. 2. The public review and approval phase will occur from December 2008 through February 2009. For more information, contact Monica Haines at 410-732-0500, ext. 1047, or comments@baltometro.org.

NACM's Credit Manager's Index for July 2008 Nudges Up
The seasonally adjusted Credit Manager's Index, which was released by the Columbia-based National Association of Credit Management (NACM), rebounded slightly in July, gaining 0.8%, as the manufacturing sector index rose 1.6% and the service sector index crept up 0.2%. All three indexes - combined, manufacturing and service - were hovering just above the crucial 50 value at 50.9, indicating a slight degree of economic expansion.
A complete index including results from the manufacturing and service sectors, along with the methodology, can be viewed at http://web.nacm.org/cmi/pdf/CMI_July2008.pdf. CMI archives may be viewed at http://web.nacm.org/cmi/cmi.asp.

TEDCO Ranks as Nation's Most Active Early-Stage Investor Again
The Columbia-based Maryland Technology Development Corp. (TEDCO) has been recognized by Entrepreneur magazine as the most active early-stage investor in the nation in 2007. For the fifth consecutive year, TEDCO ranked first on the "VC 100" list for providing the highest number of seed/early-stage deals (19) in 2007.
TEDCO's funding enables startup companies to conduct early-stage research and development in collaboration with federal labs or university researchers, allowing these companies to take key steps towards commercializing their technologies and strengthening their businesses.
To date, 108 companies have received funding from TEDCO's Maryland Technology Transfer Fund (MTTF) and completed their projects. With a total TEDCO investment of $6,278,344, these companies have gone on to receive downstream funding from angel and venture investors, federal awards and other resources exceeding $199.5 million.
The Entrepreneur survey is part of the magazine's report derived from the "MoneyTree Report" conducted by PricewaterhouseCoopers and the National Venture Capital Association, based on data from Thomson Reuters.

Gansler to Sue U.S. Army for Contamination at Fort Meade
Attorney General Douglas Gansler has notified the U.S. Army of the state of Maryland's intention to file a lawsuit to enforce the Environmental Protection Agency's (EPA) cleanup order for groundwater and soil contamination at Fort Meade.
The Notice of Intent (NOI), required under the citizen suit provisions of the Resource Conservation and Recovery Act (RCRA), alleges that the Army has failed to comply with an existing EPA cleanup order at Fort Meade. The NOI further notes the presence of contaminants in the soils and groundwater which exceed the EPA's maximum acceptable levels and may endanger health and the environment.
The Army, the EPA and the Maryland Department of the Environment have been working together for many years to investigate and remediate pollution at Fort Meade. These efforts are progressing well at many of the 150 identified sites at Fort Meade. However, in August 2007, the EPA issued an RCRA enforcement order to address cleanup at Fort Meade. The order indicated that there may be an imminent and substantial endangerment on post and ordered that immediate actions be taken to protect public health and the environment. The Army has refused to comply.

Maryland to Receive $181M in Federal Foreclosure Prevention Assistance
The state of Maryland will receive foreclosure prevention and neighborhood stabilization assistance through the Housing and Economic Recovery Act of 2008, which was recently approved by the U.S. Senate by a vote of 72 to 13.
The bill was passed in the House of Representatives on July 23 by a vote of 272 to 152. "We heartily congratulate the Maryland delegation and members of Congress on the passage of H.R. 3221," said Gov. Martin O'Malley. "This package helps address the needs created by the foreclosure crisis, and will begin the process of turning around the housing market. This means that we now have broader and more flexible tools to help sustain homeowners through these difficult times, and stabilize the communities in which they live. These tools will help us address the persistent shortage of affordable housing options in our communities."
Maryland is slated to receive $181 million in Mortgage Revenue Bonds (MRB) funds and $1,123,669 in additional Low Income Housing Tax Credits, which will generate approximately $9 million in equity.
The state and local subdivisions also will receive additional Community Development Block Grant (CDBG) funds to purchase and rehabilitate homes that already have been foreclosed upon to help revitalize and strengthen communities. The resources provided in the bill will be invaluable for Maryland, which saw foreclosure events in the first quarter grow by 617% over the same period last year.

MAVA Survey Finds Outlook for Region Is Strong
In the third quarter of 2008, more than 90% of the funds responding to the second quarter survey of the area's capital firms expect to make one or more investments in companies with ties to the mid-Atlantic region, according the Mid-Atlantic Venture Association (MAVA).
The positive forecast in regional investment is expected after a dip in local deals, as reported in the second quarter of 2008 in MAVA's quarterly survey of the region's leading investment firms.
"With investments steady despite tough public market conditions, our members tell us they anticipate private equity capital will have more impact on liquidity for the remainder of the year," said Julia Spicer, executive director of MAVA.
The survey noted that local deals declined in the second quarter, though they are forecasted to increase in the third quarter; that second quarter deal momentum maintained a steady pace; and that the pipeline is flowing, with 91% of members to close deals in the third quarter.

Lord Lewis Moonie Special U.K. Government Adviser to PharmAthene
PharmAthene, a biodefense company in Annapolis developing medical countermeasures against biological and chemical threats, has announced that Lord Lewis Moonie has joined the company as a special U.K. government adviser.
Moonie will assist PharmAthene in exploring interest and support for the company's biodefense programs and product candidates within the U.K. government. "We are honored to welcome Lord Moonie to PharmAthene in this advisory capacity and are delighted to have the opportunity to leverage his significant knowledge of the U.K. biodefense industry and amongst our NATO allies," said David Wright, PharmAthene president and CEO.
"Lord Moonie's medical background and extensive experience as a member of Parliament, as well as his oversight of the research establishment at Porton Down, which included recombinant vaccines for plague and anthrax, will be invaluable to us as we continue to expand awareness and the market for our biodefense countermeasures among our allies," Wright said. "We view Lord Moonie's appointment as an important step in the execution of our international strategy to meet the urgent needs of nations internationally requiring medical countermeasures."

Maryland DOT Consolidated Bonds Rated 'AAA,' Outlook Stable
Standard & Poor's Ratings Services assigned its 'AAA' long-term rating, and stable outlook, to the Maryland Department of Transportation's (MDOT) consolidated transportation bonds, series 2008.
The rating reflects a diverse, broad-based economy; a diverse transportation trust fund revenue stream; continued steady growth of all pledged revenues despite a recent downward revision; and strong coverage from pledged taxes and net revenues of maximum annual debt service (MADS).
The rating also reflects MDOT's prudent management practices, which include a policy of maintaining coverage levels of at least 2.5x MADS; a rapid maturity schedule, which limits, by statute, debt issuance to 15 years; and sound legal provisions, which include an additional bonds test requiring that both pledged taxes and net revenues be at least 2.0x MADS on bonds outstanding and proposed bonds.
"We base the stable outlook on our expectation of MDOT's continued steady growth in trust fund revenues and the maintenance of sound working cash levels," said Standard & Poor's credit analyst Richard Marino. "Net coverage of MADS should remain above the targeted 2.5x coverage level and coverage of pledged revenues well above that. We expect coverage levels to remain strong despite a significant capital plan and annual debt issuance."

QAI, iScan Partner on State's Digital Records Project
Fulton-based Quality Associates Inc. (QAI), a provider of services and solutions for document management, imaging and archiving, and iScan, the document imaging services division of Humanim Inc., a nonprofit organization that employs individuals with disabilities, will participate in a project for the state of Maryland Department of Assessments & Taxation.
When completed this fall, the large-scale project will effectively remove, or redact, sensitive information within nearly 325,000 records, which then will be made available to the public via the Internet.
QAI is providing the software and technical expertise needed for the project. iScan is employing a team of workers to perform the day-to-day, hands-on tasks required.
Governments at all levels are under pressure from concerned citizens to tighten the availability of sensitive information, such as Social Security numbers, while fulfilling their obligation to provide needed documentation to the general public. The process of redaction removes certain sensitive information from documents before they are made available to the public.

Howard County Sharpens Focus on Environment, Community Planning
Howard County's Department of Planning and Zoning has announced that the Division of Environmental and Community Planning has been restructured into two new separate divisions: the Resource Conservation Division (RCD), and the Division of Comprehensive and Community Planning (DCCP).
The RCD will focus on environmental protection, agricultural land preservation and historic preservation. Led by Elmina Hilsenrath, the division will work closely with the Office of Environmental Sustainability and assume staffing of the county's Historic District Commission.
The division will also oversee a water resources plan, guidance for green neighborhoods, inter-jurisdictional watershed planning, a revised Forest Conservation Manual, a Cool Cities initiative, and environmental outreach and education, including collaboration with other county agencies on the annual GreenFest.
The DCCP will focus on increasing revitalization efforts in the Route 1 Corridor, downtown Columbia, the Route 40 Corridor and Columbia's village centers. Led by William Mackey, the division will staff the newly created Design Advisory Panel (DAP).

Howard County SAT Scores Continue to Rise; Writing Score Up Seven Points
Students in Howard County's Class of 2008 significantly outperformed their counterparts in Maryland and across the nation, according to SAT data released by the College Board.
The average scores for Howard County's 2008 graduates increased in all tested areas, while state and national scores showed very little change from 2007.
Howard's average score in Critical Reading increased from 537 to 540. In mathematics, the increase was from 556 to 557. The highest jump was in writing, where Howard's average score increased from 537 to 544.
"We have become accustomed to our students scoring above state and national levels, but that does not mean we become complacent," said Howard County Public Schools System (HCPSS) Superintendent Sydney Cousin. "Even though our scores are 38 to 50 points higher than the national scores, what is most impressive is we continue to see our scores increase. That is remarkable."
The scores reported are generated by the College Board and are based on self-report data from students participating in the SAT program, according to Theresa Alban, the school system's COO.