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2017 Md. legislative session impacted tech industry

The 2017 legislative session of the Maryland General Assembly ended at midnight on April 10. You are probably asking yourself, “So, what impact does the 2017 legislative session have on me as a technology entrepreneur?” Glad you asked.

Several of the bills introduced had the power to affect technology entrepreneurs and their companies. Whether these bills passed or failed, they either began or continued significant policy discussions that are guaranteed to continue in subsequent years.

While there is not enough space to discuss each bill in detail, here is a roundup of the bills relevant to technology entrepreneurs:

Research & Development Tax Credit – This bill, introduced by Sen. Nancy King and Del. Jay Walker, seeks to increase the total available R&D tax credits from $9 million to $12 million per year. There are two types of credit available: 1) a basic credit equal to 3 percent of qualified R&D expenses, and 2) a growth credit equal to 10 percent of qualified R&D expenses. The bill was passed by the legislature and has been presented to Gov. Larry Hogan for his signature.

Business Improvement Districts – This bill allows for a group of business owners in Montgomery County to form a business improvement district if at least 51 percent of the commercial and high-rise residential properties and at least 51 percent of the assessed value of the properties sign on. These are special districts funded by an assessment on property owners. They use the funds for marketing, trash removal, landscaping, and other projects. The Montgomery County House Delegation and Sen. Will Smith put forth this legislation in order to change the statewide law, passed in 2010, which puts the statewide threshold at 80 percent. The bill was passed by the legislature and has been presented to the governor for his signature.

Biotechnology Investment Tax Credit – This bill, introduced by Sen. Roger Manno and Del. Ben Barnes, alters the definitions guiding the tax credit in order to make it more business-friendly. Biotechnology companies qualified to take advantage of the tax credit are headquartered in Maryland, have fewer than 50 employees, and have been in business for less than 12 years. The companies also need to be or will be (within two months) primarily engaged in research, development, or commercialization of innovative and proprietary technology that comprises, interacts with, or analyzes biological material, including biomolecules (DNA, RNA, or protein), cells, tissues or organs. The bill was passed by the legislature and has been presented to the governor for his signature.

Procurement reform – This session a suite of procurement reform bills introduced by various legislators at the request of the governor passed the legislature; they are aimed at restructuring an antiquated system that, among other issues, is unable to adequately address technological developments in real time. One of the bills creates a chief procurement officer charged with overseeing all of the Executive Branch’s procurement. The bill also creates a Procurement Advisory Council charged with updating and managing eMarylandMarketplace and streamlining the procurement process. Together, the package of bills are designed to improve the process by which companies do business with the State. The bills have been passed by the legislature and have been sent to the governor for his signature.

These measures show the legislature and the governor are working on various ways to promote a business-friendly environment for Maryland technology entrepreneurs. Executives for several of the companies in Maryland’s burgeoning tech corridor participated in the legislative process by reaching out to their elected officials; some testified in bill hearings. The legislative process produces the best results when legislators work with their constituents to address their concerns and develop an environment where they can thrive.

Now that the 2017 legislative session has ended, the excitement is dying down in Annapolis. But don’t worry, next year’s legislative session begins in the first days of January 2018.

Camille Fesche is an attorney and lobbyist who regularly appears before the Maryland General Assembly.



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