Friday Five
Oct. 2, 2026 | This week's latest on Maryland business and government
1 — Maryland's budget, your wallet
Maryland faces a projected $2.57 billion structural budget deficit in fiscal 2028, growing to $3.44 billion by fiscal 2030, even as the state’s near-term revenue outlook improved by about $320 million. The state's fiscal choices can affect household costs, business investment, jobs, public services and Maryland’s overall competitiveness. Policymakers are encouraged consider both sustainable spending reforms and policies that help businesses and workers succeed while also generating broader economic activity.
Our take: Closing the budget gap will requires balancing spending decisions with efforts to strengthen economic growth, rather than relying solely on higher taxes and fees.
2 — Maryland needs more housing, Moore bets faster, cheaper construction will help
Governor Moore signed two executive orders yesterday aimed at increasing Maryland’s housing supply by speeding up permitting, expanding modular and manufactured housing and strengthening the construction workforce. The actions come as Maryland faces a housing shortage of more than 100,000 units, with high housing costs contributing significantly to poverty across the state.
Abundance-plus-affordability: A 2025 Urban Institute report found that policies such as eliminating restrictive land-use regulations and speeding permitting can help increase housing production, but said those measures should be paired with financing and other incentives that reduce the cost of constructing and operating housing affordable to low- and moderate-income households. The researchers described the approach as “abundance-plus-affordability.”
3 — State revenues get modest bump despite ‘mixed’ indicators
Maryland’s Board of Revenue Estimates increased its current revenue forecast by $320 million, but it also highlighted concerns about growing inflation and a projection that tax withholdings in the first half of the year would grow at half the rate of the same period a year ago. The board projects nearly $28.4 billion in general fund revenue for fiscal 2028, but that 3.3 percent growth remains below the state’s historical trend and is not expected to eliminate the projected $3 billion structural budget gap.
IT tax: The board also revised revenue estimates down for the IT tax passed in 2025 which has woefully underperformed the $500 million in revenues projected by legislative analysts. After a full year, the state has only collected $100 million while further damaging its business competitiveness.
4 — Lawmakers eye new EV taxes to fund bridges, roads, highways
Maryland lawmakers are considering mileage-based fees as a potential way to replace declining gas tax revenue, which is projected to generate $300 million less by 2031 as vehicles become more fuel-efficient and electric vehicle use grows. Similar proposals have stalled in recent legislative sessions but could return in 2027 as the state faces rising transportation maintenance costs and broader budget pressures. Supporters say charging by miles driven could create a more sustainable transportation funding source, while critics have raised concerns about administration, enforcement and potential evasion.
Quoted: “It’s very clear that [electric] vehicles aren’t going away, which means they’re still having the same impact on the roads and the same infrastructure impact that they were having before,” Frederick County Delegate Kris Fair said.
5 — Maryland’s FAMLI is here, and businessowners need to do more than just pay into it
Maryland’s Family and Medical Leave Insurance (FAMLI) program will begin payroll deductions Jan. 1, 2027, requiring employers with at least one covered employee to register and participate in either the state plan or an approved private plan. Employers with 15 or more employees will split the 0.9 percent contribution rate with workers, while smaller employers generally only remit the employee share.
Important to note: Businesses must complete initial registration themselves and prepare for quarterly reporting, employee notices and other administrative requirements before benefits begin in January 2028.
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The Maryland Chamber of Commerce is the state’s leading business advocacy organization — committed to working with our alliance of partners on critical public policy issues. With a focus on economic development and grassroots advocacy, we impact policies that directly affect Maryland business.
