Legislative Report -- March 26, 2008
Senate Passes Amended Greenhouse Gas Bill
The Maryland Senate passed an amended version of SB 309 late last week by a vote of 31-16. This legislation mandates a 25 percent reduction in greenhouse gas emissions by 2020. It also sets a goal of a 90 percent reduction in by 2050.
The legislation now moves to the House of Delegates, where it will be considered first in the Economic Matters and Environmental Matters committees.
The Maryland Chamber opposes the bill. Reducing greenhouse gas emissions is a national and global issue. State-specific action could place Maryland businesses at a competitive disadvantage. This legislation is overly ambitious and unachievable. It’s not the answer to the global warming problem. It could cost Maryland jobs, increase energy prices, and cripple industries trying to compete in a global marketplace.
While the Chamber opposes the bill, it strongly supported a key amendment adopted by the Senate. As amended, the bill states that the Maryland Department of the Environment (MDE) may not implement new emissions reduction measures until the Maryland General Assembly enacts legislation specifically authorizing the new measures.
As originally drafted, the bill required MDE to report its plans to the General Assembly for review, but not for approval. Requiring legislative approval before new MDE initiatives take effect will ensure the business community has adequate opportunity to educate lawmakers on the business impact of additional CO2 reduction requirements. See how your Senator voted on this key amendment here.
Corporate Reporting Requirements Bill Clears Both Houses
Legislation to moderate the onerous corporate reporting requirements adopted during the November 2007 special session was unanimously passed by both houses earlier this week. Passage of this legisltion is a Maryland Chamber priority.
The bills, SB 444/HB664, reduce the most onerous and unnecessary aspects of the reporting requirements while still gathering the data that the State needs for calculating more accurate fiscal note estimates on corporate tax matters.
The Maryland Chamber thanks Sen. Nancy King (D-Dist. 39) and Del. Kumar Barve (D. Dist. 17) for their leadership on this important issue to many Maryland businesses. Contact Karen Syrylo, CPA for further information at ksyrylo@mdchamber.org
House Committees Help Business on Procurement Bills
Many state procurement bills opposed by the Maryland Chamber have been defeated or withdrawn by the bills’ sponsors, largely due to the help of the House Health and Government Operations Committee and the House Economic Matters Committee.
Members of both committees were responsive to the concerns expressed by businesses regarding these bills. HB 106 would have applied the $11.30 per hour “living wage” rate on state service contracts statewide. HB 28 and HB 290 would have required state apparel procurements be made from domestic manufacturers. HB 970 and SB 958 would have required prevailing wage rates on any construction contract of over $500,000 using state funds. HB 990 would have imposed additional standards for a “responsible bidder” on state contracts, while HB 1282 would have required contractors to provide health, dental and vision care on state construction projects. Finally, HB 1304 would have applied state MBE guidelines for any entity receiving a state grant or financial assistance. The Maryland Chamber successfully opposed all of these bills as costly and unnecessary interference in the competitive bidding process.
Delegate Dan Morhaim’s (D-Dist. 11) HB 865, which would expand bidding opportunities for state contracts in eMaryland Marketplace, is supported by the MD Chamber and appears headed toward passage. Contact Ron Wineholt for further information at rwineholt@mdchamber.org .
Time Running Out on Tech Tax Repeal
Governor Martin O’Malley met with legisltive leaders last night to discuss the potential repeal of the computer services sales tax enacted during the November 2007 special session. News reports indicate that no consensus has been reached.
With less than two weeks remaining in the session, it’s important that opponents of the tech tax keep the pressure on. Contact your legislators and encourage them to repeal the tech tax. The tax will:
- Stifle economic development and job creation.
- Make Maryland businesses less competitive.
- Hurt small and growing companies.
- Damage important Maryland industries that rely on technology services to innovate and compete.
- Be difficult for the State to administer.
The Fight the Tech Coalition has been working hard all session to convince lawmakers to repeal the computer services sales tax. For more information, or to take action, visit www.FightTheTechTax.com.
Competing with Prison Labor for Service Jobs
The Maryland Senate recently passed legislation that would allow the State to unfairly use low cost prison labor to compete against for profit businesses for service jobs.
Under current law, Maryland Correctional Enterprises (MCE) may not (with limited exceptions) sell goods or services on the open market. MCE currently offers data entry, printing, furniture restoration, mailing and distribution, AutoCAD design and transportation and moving services. SB 145 would allow MCE to expand into any additional service and offer it in the marketplace.
Maryland Chamber Vice President of Government Affairs Ron Wineholt testified in opposition to the legislation during a hearing today in the House Health and Government Operations Committee.
“While the chamber recognizes the State’s interest in providing meaningful job training for incarcerated individuals, MCE is not bound by the labor laws imposed by the General Assembly on all private employers, including minimum wage rates, fringe benefits, overtime, leave, and of course taxes,” Wineholt said.
According to the bill’s fiscal note, MCE estimates that the bill would enable them to make an additional $1 million in sales in fiscal year 2009. This would come at the expense of sales that would otherwise be made by private sector companies with the taxes that would have been paid on those sales, wages and facilities.
The Chamber believes this bill is far too broad and open ended. At a time when businesses face a slumping economy and higher taxes, they must now face the prospect of unfair competition from Maryland Correctional Enterprises.
No News is Good News on the Split Rate Property Tax Bill
There has been no action on legislation to authorize each county to establish classes of real and personal property and impose varying rates of taxation on each class (SB 561/HB 676). Defeating this legislation is a Maryland Chamber priority.
A minority of states authorize local government to impose differential tax rates on varying classes of property. Such laws always result in local government imposing discriminatory and burdensome levels of taxation on business property, sometimes at levels two to three times the level for residential property.
Since at least 1929, state law has required counties to impose one rate of taxation on all property. The only exceptions to this longstanding policy occurred in 1975, when tax differentials for municipal areas were authorized, and in 2000, when a separate rate of tax was authorized for business personal property as part of the conversion to full value real property assessments.
Maryland businesses will already pay approximately $760 million of the $1.4 billion in new taxes enacted during the 2007 special session. With economic indicators suggesting a possible recession, the last thing businesses need is even higher levels of property taxes.
House Passes Manufacturing Personal Property Tax Exemption Bill
The House of Delegates unanimously passed Maryland Chamber supported legislation, (HB 1609) to give manufacturers additional time to apply for and receive a personal property tax exemption on their machinery and equipment.
Under current law, machinery and equipment used in the manufacturing process is exempt from local property taxation in most counties and many municipalities. However, in order to receive the exemption the business must have an approved exemption on file with the Department of Assessments and Taxation or have applied for the exemption by September 1 of the tax year.
A new manufacturer that is unfamiliar with the September 1 requirement can easily miss that deadline. Although personal property returns are filed by June 15 (on extension), assessments of personal property may not be received until well after September 1.
This legislation would enable businesses to apply for a manufacturing exemption up to six months after receiving a personal property assessment notice and still receive the exemption for the current tax year. This provision is fair and comparable to the existing law for the time allowed to apply for a manufacturing exemption when personal property is transferred.
The Chamber will continue to work to ensure Senate passage. For more information, contact Ron Wineholt at rwineholt@mdchamber.org.
Maryland Chamber to Present Health Insurance Forums
Insurance premiums for traditional health insurance plans are rising drastically each year. There are alternatives on the market for small employer groups to cut their costs and put cash back into their pockets.
Attend one of the Maryland Chamber’s upcoming Health Insurance Forums to learn more. Our panel of experts will discuss alternative options for small and medium-size employers (10-100 employees), including HSA and HRA plans, Federal Alternative Funding Plans and Traditional Insurance Plans. Panelists include:
- David Cardwell, Sr., President, Direct Sales, GBS HR & Benefit Solutions
- Darryl Bodnar, CPA, Naden/Lean, LLC
- Kevin Vail, Manager, Provident Bank
Upcoming events include April 30 in Hunt Valley, May 14 in Lutherville, and May 28 in Rockville. All forums will begin at 9 a.m. and end at 11 a.m. Registration is $15 for Maryland Chamber members and $30 for nonmembers. For more information, click here.
This program is being presented by the Maryland Chamber’s Business Development Council and is being sponsored by Verizon Wireless.
Upcoming Events
April 2, 2008
Chamber 101
Sheraton Annapolis Hotel
173 Jennifer Rd.
Annapolis, MD 21401
8 a.m.
April 22, 2008
Annual Membership Meeting &
Business Hall of Fame Awards Dinner
Hyatt Regency Baltimore
300 Light St
Baltimore, MD 21202
5:30 p.m.
Dates
April 30, 2008
GBS HR & Benefit Solutions
6 North Park Drive, Suite 310
Hunt Valley MD 21030
RSVP by April 21
Register
May 14, 2008
GBS HR & Benefit Solutions
1301 York Road, Suite 400
Lutherville MD 21093
RSVP by May 5
Register
May 28, 2008
GBS HR & Benefit Solutions
2400 Research Blvd, Suite 420
Rockville MD 20850
RSVP by May 19
Register
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