The 2008 Session continued our record of successfully defending the interests of our members from legislation that would hamper their success and, more modestly, securing changes in the law that will be beneficial. The major issue facing the state, namely the persistent threat of deficits, was largely addressed during the Special Session in November 2007. However, one of the carry-over problems from that Session was the extension of the newly-increased 6% sales tax to computer services. A general outcry by the State’s high tech community led to its repeal. Repeal came at a high cost, however. The General Assembly enacted a new “millionaires’ bracket” to the State personal income tax, imposing a tax rate of 6.25% on incomes of over $1 million. (That rate is almost one-third higher than the 4.75% rate paid by most Marylanders.) Because partnerships, Subchapter S corporations, and LLCs pay taxes at personal rates, this punished successful entrepreneurs in all industry segments in order to satisfy the computer tech sector. The legislature also reduced by $50 million annually through 2013 money that otherwise would have flowing into the Transportation Trust Fund, thereby reducing future highway projects. In an apparent abdication of Legislative oversight, the bill also requires the Governor to find an additional $50 million in budget reductions to be presented at the Board of Public Works by July 1. The bill was signed by Governor O’Malley the day after the 2008 Session adjourned.
On the positive side, we were pleased to see the State take a strong position in favor of “green” construction with the passage of SB 208, which essentially requires all building construction fully funded by the State to achieve LEED Silver and provides funding for new school construction after 2009. HB 865, sponsored by one of Maryland AGC’s supporters, Delegate Dan Morhaim of Baltimore County, expanded the requirement for government units at State, county, and municipal levels to post RFPs on eMaryland Marketplace. This simplifies the search for future work for large and small companies alike. Another Morhaim bill, HB 312, made permanent the role of individual sureties for bonding State construction, where appropriate. Small constructors were helped by the passage of SB 186, expanding the scope of the small procurement process. Finally, an anomaly in the regulation of so-called “industrialized buildings” was corrected by SB 951 and HB 1476, which prevented the ludicrous result of all job site trailers being declared illegal, with potentially disastrous consequences for the industry and owners.
Bills that were successfully defeated included attempts to impose inappropriate and unworkable requirements for eligibility to bid on State building contracts (HB 990), overtime pay (HB 1235), employer-paid health care (HB 1282), and emergency repairs in time of disasters (HB 1487), and expansive and expensive regulation of even very small demolition activity (SB 907 and HB 1526). Legislation to require small contractors to have registered apprentice programs was sent to “summer study”, which means it may be the subject of a committee hearing during the interim before the 2009 Session.
Barbara Wilkins, our lobbyist with the law firm of Holland+Knight, one of our Associate Members, gave her usual invaluable assistance to Maryland AGC, for which we are most appreciative. Members who took the time to call or write their Senator or Delegate on the important issues played the most important role in our successes and, on behalf of all of the members, please accept my most sincere thanks. As always, please call the office if you have any questions.
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