We hope you’re enjoying the “Friday Five” emails. During the legislative session, on the last Friday of the month, instead of a “Friday 5,” you will receive a more detailed “From the Halls” newsletter featuring updates on previously shared items of interest, along with the latest news from session.
Below, you will find the January 2020 issue of “From the Halls.” But first, here’s a little trivia about the Old Line State:
*What Maryland cities are spread out among two different counties? (See answers at bottom of newsletter.)
OUR BILL TRACKER IS NOW AVAILABLE
Our bill tracking system is now available to Maryland Chamber members. Concise summaries of each bill are provided—along with the Chamber’s positions: support, oppose, hold or amend. We encourage our members to regularly review this section of our website for the most up-to-date legislative information. You can find the tracker by going to our homepage, hovering over the “Advocacy” tab, and clicking on “2020 Bills”—or you can click here.
BUSINESS-RELATED BILL UPDATES
It is hard to believe, but we’re about one full month into session. We’re monitoring a handful of “big-ticket” bills that are sure to have a considerable impact on the business community. Here’s the status of a few of them:
Earlier this month, Senators Mike Miller and Bill Ferguson introduced Senate Bill 2, which would tax social media companies at up to a 10% rate on the revenue earned from digital ads that target Maryland IP addresses.
On Wednesday, January 29, the Senate Budget and Taxation Committee heard testimony on this bill (a video of the hearing can be viewed here).
If signed into law, Maryland would become the first state to impose a targeted punitive tax on the gross revenue of digital advertising services. The Maryland Chamber of Commerce opposes this bill, as it violates federal law, and discriminates against interstate and foreign commerce among any number of other legal and policy concerns. Though leaders in the Senate suggest that global corporations are the intended targets of the legislation, the real impact will be most felt by Marylanders who use advertising services within a digital interface. Digital advertising service providers will pass through the increased costs of this tax on to their customers. This includes Maryland’s businesses that utilize online platforms to promote their products or services or to reach new customers.
Earlier this month, Senator Robert Cassilly re-introduced Senate Bill 157, legislation that would establish liability protection for employers who hire previously incarcerated individuals in four specific industries. We’d like to thank our member, Vehicles for Change, as well as members of the Maryland Chamber Foundation’s Second Chance Task Force, for testifying on the bill before the Senate Judicial Proceedings Committee on Tuesday, January 28 (a video of the hearing can be viewed here).
The Maryland Chamber advocates for this type of legislation, as employers take on a great amount of risk when they hire any employee, let alone one with a criminal background. This legislation would mitigate some of that risk, encourage the hiring of previously incarcerated individuals, and ultimately reduce recidivism rates.
The Maryland Data Centers Coalition held its second meeting on Tuesday, January 28. The coalition is a group of businesses and organizations interested in passing legislation that would provide a sales-and-use tax exemption for the sale of computer technology for use at a qualified data center. Just this week, Senators Steve Hershey and Douglas J.J. Peters introduced Senate Bill 397, which would do just that.
We’re pleased to announce that the Maryland Chamber Foundation has commissioned Mangum Economics to conduct a research study on the potential economic impact of data-center tax exemptions on the state of Maryland. The final study will be completed by late March. We’ve already seen the incredible impact data center incentives have had in the state of Virginia: In 2019, every $1 million of incentive generated 155 jobs, $26.5 million in state GDP and $14.6 million in personal income.
If passed, SB 397 would level the playing field with neighboring states, attract data center business to Maryland, and support the state as a leader in innovation and investment in cyber and IT. A Senate hearing on the bill is scheduled for Wednesday, February 12, at 2 p.m.
GENERAL ASSEMBLY OVERRIDES VETOES
On Thursday, January 30, the General Assembly voted mostly on party lines to override five of Governor Hogan’s vetoes from last year. Lawmakers reversed Hogan’s vetoes of the following bills:
It takes 29 votes in the Senate and 85 votes in the House to override a veto. Read more here.
GOVERNOR HOGAN INTRODUCES THE UNIVERSAL SCHOOL START ACT OF 2020
On Wed., Jan. 29, Governor Hogan introduced the Universal School Start Act of 2020, to return the start of school to after Labor Day. Last year, lawmakers repealed the governor’s popular pro-family and pro-business executive order requiring that school start after Labor Day. Read more.
KROGER, OCADO SELECT MARYLAND FOR NEW HIGH-TECH FULFILLMENT CENTER
On Thurs., Jan. 23, Kroger Co., the nation’s largest grocery retailer, announced plans to construct a 350,000-square-foot robotic customer fulfillment center in Frederick, which will fill online grocery orders for shoppers in Md., Pa. and Washington, D.C. Kroger is partnering with Ocado, one of the world’s largest online grocery retailers, which will provide and maintain the digital and robotic equipment used at the facility.
The Frederick facility will be one of six Ocado “sheds” announced by the two companies so far. Upon completion, an estimated 400 new jobs will be created with up to 100 more added later as the service areas of the facility expand. Read more.
HETTLEMAN, RUTH CHOSEN FOR VACANT GENERAL ASSEMBLY SPOTS
On January 28, the Baltimore County Democratic State Central Committee voted to confirm Del. Shelly Hettleman and county activist Sheila Ruth as the nominees for vacant Baltimore County seats in the General Assembly. Their names will now be forwarded to Gov. Hogan, who has final say in appointing GA replacements. Hettleman would fill Sen. Bobby Zirkin’s seat; Ruth would fill Del. Charles Sydnor’s. Hettleman and Ruth will serve until 2023, the remainder of the terms left by Zirkin and Sydnor.
Fulfilling his promise to overhaul the North American Free Trade Agreement, President Trump signed the U.S.-Mexico-Canada Agreement (USMCA) into law on Wed., Jan. 29.
“This law is a major win for our farmers, manufacturers and small businesses—and for the Maryland economy and entire country,” said Christine Ross, president and CEO of the Maryland Chamber, which has long been a part of the coalition of business partners that had been pushing for swift approval of USMCA.
In 2018, Canada and Mexico were responsible for the purchase of nearly one-fifth of Maryland’s total global manufacturing exports, and over the past decade, Maryland has increased goods exported to Canada and Mexico by more than 80%. Without the USMCA agreement, these goods would have faced a minimum of $36 million and up to $178 million in extra tariffs.
Mexico has ratified the deal, and Canada is expected to approve it soon.
Written by Ashley Duckman, Vice President of Government Affairs, Maryland Chamber of Commerce.