House, Following Senate, Approves County-friendly Budget

On Wednesday, while most of the State stayed off the snowy roads, the Maryland House of Delegates passed a county-friendly budget that relieves counties of the requirement to pay additional costs for property assessments, provides an additional $1 million to local health departments, and preserves all local transportation funding originally included in the budget by Governor Hogan – a welcome move as counties plow through funds to clear roads of nearly a foot of spring snow.

The House approved all of the Senate’s county-friendly moves made last week. It reduced spending by slightly more than the Senate, at $300.5 through the SB 187, the Budget Reconciliation and Financing Act of 2018 (“BRFA”).

Like the Senate, the House chose to credit $200 million in new income tax revenues to support education funding via recommendations anticipated from the Kirwan Commission.

The House has passed a few pieces of legislation to provide tax relief to Marylanders. These include:

  • HB 58, which, as amended, expands the existing pension exclusion by allowing the deduction of otherwise eligible employee retirement system income which has been rolled over to an IRA;
  • HB 296, which expands the existing State subtraction modification for “Hometown Heroes” to correctional officers;
  • HB 327, which expands the existing military retirement income tax subtraction modification by exempting all military retirement income from state and local income taxes by 2022;
  • HB 365, which clarifies the Maryland taxpayers may still take exemptions from state and local incomes taxes;
  • HB 570, which as amended, indexes the Maryland standard deduction to cost of living; and
  • HB 856, which makes the Earned Income Tax Credit available to individuals without children who are ages 21-25.

The combined effect of all these bills is estimated at about $17 million to the State for fiscal 2019 (or about $10 million, more or less, to all counties). On the House floor, Ways and Means Chair Anne Kaiser suggested that more action may be taken in future years to provide additional relief to taxpayers – but after the true impacts of federal tax reform are actually known, rather than guessed.

Helpful Links

House Appropriations Committee – Report on SB185 – the Budget Bill and House Bill 152 – the Budget Reconciliation and Financing Act

House Appropriations Committee SB185 Reprint (The Budget Bill)

House Appropriations Committee Reprint of SB187 – Budget Reconciliation and Financing Act of 2018

Report of the House Appropriations Committee – Recommendations, Reductions and Summary of Action Pertaining to SB185 (Budget Bill FY2019)