The American Rescue Plan Act's (ARPA) State and Local Fiscal Recovery Funds (SLFRF) program was a historic investment in communities. It provided direct funding to cities, towns and villages to help communities weather and recover from the COVID-19 pandemic. On its 5-year anniversary, the National League of Cities (NLC) has published a report looking back on the wide-ranging impact SLFRF has had on communities and how federal funding dollars can be administered in the future to prioritize both efficiency and federal oversight. The resource page for the report can be found here and a direct link to the report can be found here.

For more information please contact Bill Jorch, [email protected]

Last week, MML staff testified in opposition to HB 831, legislation that would allow all local government employees to participate in a union and collectively bargain. Currently, local governments may allow certain groups of employees (ex. law enforcement, public works) to unionize and collectively bargain but it is at the employer's discretion. The employer can also set the parameters around the negotiations including what types of compensation and benefits are eligible to be negotiated and how an impasse in discussions is resolved. This bill would turn the current arrangement on its head. MML noted the direct fiscal costs associated with increased negotiated compensation and the administrative burden of detailed negotiations and managing potentially multiple contracts as reasons for opposition to the bill.

The Senate cross-file, SB 922 has its public bill hearing on March 12. For more information please contact Bill Jorch, [email protected].

Last week, MML staff testified on the third bill in Governor Moore's 2026 housing package, the Maryland Transit and Housing Opportunities Act. As presented, this bill would automatically designate transit-oriented development (TOD) areas served by frequent rail service as Enterprise Zones, and delay the collection of development impact fees and excise taxes until after construction is complete. It also restricts the authority of local jurisdictions to impose minimum parking requirements, and mandates allowance for mixed-use development within specified distances of qualifying rail stations. 

The Maryland Municipal League's position is Favorable with Amendments. We are seeking amendments to address the automatic Enterprise Zone designation, and the impact fee/excise tax payment delay. Conversations with the Administration and General Assembly Committees are ongoing. Contact Angelica Bailey Thupari ([email protected]) with questions.  

 

The Maryland Department of Information Technology has issued a new Cybersecurity and Privacy Policy Suite establishing unified security standards for all executive branch agencies to strengthen protection of state systems, data, and services against increasingly sophisticated threats.

Last week MML testified in opposition to SB 3 / HB 188, a bill that alters certain aspects of the State's unemployment insurance system. The most impactful provision for municipal governments is the increase in weekly benefit amount to successful claimants. Municipal governments are typically "reimbursing employers" meaning that they reimburse the unemployment insurance trust fund when a former employee makes a successful claim. This means that municipal government expenditures are tied to the amount a claimant receives, dollar-for-dollar. This is different than private sector employers, which regularly pay into the Fund based on the taxable wage base.

While the League recognizes that the unemployment insurance weekly benefit amount has not been updated in many years, the provisions of the bill would raise the cost to municipal governments to a level that would pose a significant burden.

This week, MML testified on SB 36 and its cross-file HB 239, legislation that would limit local zoning authority for certain residential housing types. The bill would prohibit municipalities from applying specific zoning standards, such as setbacks, lot coverage, or design requirements, to “starter” and “silver” homes, and would enable property owners on improved lots to subdivide into smaller lots under certain conditions.

MML’s testimony acknowledged the importance of expanding housing supply but raised concerns about state limits on local zoning and planning authority, especially near infrastructure and services. We emphasized that local governments need tools to balance growth with community character, public safety, and service capacity.

Last week, the Maryland Municipal League (MML) testified before the House Ways and Means Committee on HB 594. While MML supports the bill - which seeks to return a portion of sales tax revenue to the City of Baltimore - we officially testified as Support with Amendment.

Currently, HB 594 would require the Comptroller to pay the City of Baltimore one-third of the sales and use tax revenues collected within its borders. In the hearing, MML staff highlighted how municipalities are the economic hubs of the state, where 34% of all sales tax revenue is generated despite only accounting for 5% of the state’s land mass.

Last week, the Maryland Municipal League (MML) testified before the House Appropriations Committee in strong support of HB 559. This bill represents a critical turning point in our years-long advocacy to restore and protect Highway User Revenues (HUR) for Maryland’s cities and towns.

For years, municipal governments have operated under temporary "funding bridges" that increased our share of gas tax and vehicle fee revenues. However, under current law, those increases are set decrease after Fiscal Year 2027, from the 3.0% allocation of Highway User Revenues to 2.4%.

MML testified Favorable with Amendments on SB 389, which would modify the State’s Transit-Oriented Development (TOD) framework. The bill would automatically designate qualifying TODs as Enterprise Zones and require that development impact fees and excise taxes for residential TOD projects be collected only after construction is complete and a certificate of occupancy is issued.

MML supports transit-oriented development and rail-adjacent housing growth. However, we raised concerns that automatic Enterprise Zone designation would apply a 10-year local property tax credit without local approval, creating significant fiscal implications for municipalities. We also expressed concern that delaying impact fee collection shifts infrastructure financing risk to local governments.

MML testified on SB 325 and cross-file HB 548, which would create a framework for permitting and vested rights protections. Once a substantially complete development application is submitted, the project would become subject only to the laws in effect at that time, and vesting rights would be established for a defined period.

In testimony, MML supported measures that reduce regulatory uncertainty for developers, but emphasized that vested rights and permitting timelines must preserve local oversight and stay aligned with municipal comprehensive plans.

For nearly 60 years, Maryland’s municipal revenue structure has remained largely unchanged, forcing our cities and towns to rely on property taxes for approximately 50% of their general fund budgets. This over-dependence is no longer sustainable.

We have a critical opportunity to change this. HB 1142, MML's priority bill sponsored by Ways and Means Chair Jheanelle Wilkins, establishes a Task Force to Modernize County and Municipal Revenue Structures. This "blue-ribbon" commission will study alternative revenue sources - such as those used in other states - to ensure our communities can remain fiscally resilient without placing the entire burden on property owners.

MML staff testified in opposition to HB 203 which would generally prohibit employers from entering into training repayment agreements with their employees as a condition of employment, with some exceptions. Training repayment agreements allow employers to pay for job training for employees but requires them to stay with the employer for a certain time period, otherwise the employee would be obligated to repay a portion of the cost of the training. When done properly these types of agreements benefit both the employer and the employee; the employee receives on the job training at a subsidized cost while the employer sees a return on the investment they made in their human talent. Eliminating this tool will remove the incentive for municipal governments to offer this fringe benefit.

For questions, please contact Bill Jorch: [email protected]

Last week, MML staff testified before the House Government, Labor, and Elections Committee in strong support of HB 99, a bill vital to ensuring that cities and towns have the final say in how their newly annexed land is developed. The legislation is sponsored by Delegate Schindler, a former municipal official from Hagerstown, Maryland.

Under current law, municipalities often face a "zoning freeze" after an annexation, regularly referred to as “The 5-year Rule.” Even when a town has a clear, community-vetted comprehensive plan, they are frequently barred from implementing higher-density or different land uses for five years unless they receive express permission from the county.

MML's Legislative Committee, made up of municipal elected officials and staff from around the State, has been busy reviewing General Assembly legislation that impact municipal governments. For a full list of bills with official MML positions, please visit our website here. This page will be updated as new positions are taken by the MML Legislative Committee. For questions please contact Bill Jorch, [email protected]