Tax breaks, ethics reform and transportation scoring top list of Md. bills signed

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ANNAPOLIS — Manufacturers moving to or expanding operations in Maryland could be eligible for tax breaks under a bill signed into law Tuesday by Gov. Larry Hogan, one of 115 measures the governor signed into law less than 11 hours after balloons and confetti marked the end of this year’s 90-day legislative session.

Hogan also signed into law bills that reform ethics laws in the state and substantially alter a transportation scoring system he dubbed “the road kill bill.”

Hogan said he hoped to use the promise of tax credits to convince businesses to relocate their manufacturing operations and existing businesses to expand their job offerings in the state.

“This is going to help the areas where we need the jobs, in Baltimore City and Western Maryland and the Eastern Shore and places like that,” he said.

The House and Senate compromise bill that was signed into law combines tax credits with a focus on worker training at area community colleges.

Businesses relocating to Maryland get some of the biggest breaks, including a 10-year exemption on sales and property taxes and filing fees with the State Department of Assessments and Taxation as well as a 5.75 percent refundable tax credit for 10 years against the wages of each employee hired. Those new manufacturers must locate in targeted areas of the state, including Allegany, Dorchester, Garrett, Somerset, Wicomico, and Worcester counties and Baltimore City or the Tradepoint Atlantic site in Sparrows Point.

Existing businesses would get the same tax credit against employee wages.

Sen. Richard Madaleno, D-Montgomery and vice chair of the Senate Budget and Taxation Committee, noted that employers will see larger tax cuts if they pay workers higher wages.

“We structured it in a way that the more you pay in salaries, the more you pay your workers, the better the tax credit you get,” Madaleno said.

Ethics reform

Hogan also saw his ethics reform bill, amended from his original proposal, pass in the last days of the session. The governor’s proposal followed the resignations and federal indictments of two delegates from Prince George’s County and the public reprimand of Del. Dan Morhaim, D-Baltimore County, related to his work as a consultant for a company seeking a license to grow and process cannabis in Maryland. On the same day the ethics reform bill passed the Senate, Sen. Nathaniel Oaks, D-Baltimore, was charged in federal court with taking more than $15,000 in bribes in a phony development scheme.

Additionally, the law requires the state ethics commission to post annual financial disclosures online. Currently, the forms are only available at the commission’s Annapolis office. Those who wish to view or make copies of the forms must come to the office and provide photo identification and their own home addresses. Officials are notified in real time as their reports are accessed.

The law will also require the ethics commission to remove public officials’ home addresses when publicly releasing those disclosure forms.

Transportation projects

Tuesday’s bill signing also brought to a close a heated battle between Hogan and Democrats and advocates of public transportation over a controversial project scoring bill.

“This will allow us to move forward with priority projects across the state,” Hogan said. “They’ll all move forward immediately.”

Hogan’s statement is a departure from those over the last year in which he criticized the scoring bill as overtly political and dubbed it “the road kill bill.”

Hogan vowed a repeal and introduced legislation to roll back the law, which would have required local transportation projects to be scored and ranked. Departures from the ranking, which were allowed, would need to be explained to the legislature.

Hogan said that plan would eliminate funding for 66 of 73 proposed projects.

The bill as signed into law is not exactly a repeal but creates a practically never-ending delay in implementation. Instead, transportation projects will have to be ranked and that information provided in the governor’s annual six-year plan. Additionally, the law calls for a three-year study of the scoring system, which must be developed by the governor.

Democrats said they went along with the change because the new law places more focus on the governor’s transportation priorities and how to fund proposed projects they say would exceed the state’s ability to pay for them by $1.5 billion.