2025 Legislative Report

2025 LEGISLATIVE REPORT

Maryland Chamber of Commerce 2025 Legislative Report

The mission of the Maryland Chamber of Commerce is to advance inclusive partnerships for a Maryland where all businesses and their communities thrive.

2

INTRODUCTION

2025 VETOED BILLS

TABLE OF CONTENTS

3

BUSINESS REGULATION & OPERATIONS CIVIL LIABILITY

4

6

CYBER & TECHNOLOGY

9

EDUCATION & WORKFORCE DEVELOPMENT

16

ENERGY & ENVIRONMENT

HEALTH CARE & BIOPHARMA LABOR & EMPLOYMENT TAXATION

14

25

28

36

TRANSPORTATION & INFRASTRUCTURE

42

WORKERS COMPENSATION & UNEMPLOYMENT INSURANCE 46 GOVERNOR MOORE’S LEGISLATIVE PRIORITIES THAT THE CHAMBER SUPPORTED 49 CONCLUSION

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POLICY COMMITTEES

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INTRODUCTION Dear Members, The main street shops where we buy our groceries. The restaurants where we celebrate milestones with family.

The HVAC companies we call when our systems fail. The mom-and-pop businesses that employ our neighbors. The manufacturing facilities that anchor entire communities. These are the businesses that make Maryland work — and they’re under unprecedented pressure.

As I travel across our state, I hear the same concerns from business owners everywhere: Maryland has become one of the most expensive, most regulated, most challenging places to operate a business in America. We’re hemorrhaging companies to Virginia, Delaware and states that understand the crucial connection between business success and community prosperity.

The 2025 legislative session proved both how far we’ve come — and how much farther we have to go. The challenges we face didn’t develop overnight, and they won’t be solved in a single legislative session. We’re working to fundamentally change how Maryland approaches business policy — from treating companies as sources of revenue to recognizing them as drivers of prosperity and creators of economic opportunity.

This report details our fights, our wins and the work that lies ahead.

Sincerely,

Mary D. Kane President & CEO

Session 2025 for the Maryland Chamber Your Chamber Works on Every Issue That Affects Your Bottom Line

• • • • •

200+ bills tracked and analyzed — so you didn’t have to 68 harmful business-critical bills defeated — from liability caps to regulatory reform 30 local chambers engaged in advocacy — amplifying your voice statewide 605 business leaders shaping policy through our committees — your seat at the table 585 business leaders, policymakers and administrative leaders involved in our annual Meet the State, Chamber Advocacy Day and Maryland Business Outlook events — providing direct influence and advocacy during session

Every day, we’re fighting to: • Ensure you can compete with businesses in other states • Stop additional taxes and fees • Prevent new regulatory burdens from hitting your business • Protect your ability to be successful, grow your bottom line and support your employees and community While you’re running your business, we’re defending you in Annapolis and advocating for policies that will help your business thrive.

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SESSION 2025

Maryland Chamber of Commerce 2025 Legislative Report

by the Numbers

2025 Vetoed Bills While the Maryland Chamber of Commerce was successful in advocating against and defeating numerous proposals that would have negatively impacted the state’s business climate — such as the Sales and Use Tax Expansion and Noneconomic Damages for Personal Injury and Wrongful Death — we did submit one veto request to the Governor for House Bill 424/Senate Bill 357 — Lowering Prescription Drug Costs for All Marylanders Now Act. This legislation expands the authority of the Prescription Drug Affordability Board to set upper payment limits on prescription drug products across all purchases and payor reimbursements in the state, including those made in the private market and through private insurance plans. While we support efforts to improve access to affordable medications, we remain concerned about the unintended consequences this bill could produce, including hindering innovation, disrupting Maryland’s life sciences sector and deterring private investment.

Bills from the General Assembly

1,052 1,565 Introduced

by Senate

Introduced by House of Delegates

Bills Tracked by the Chamber 123

Senate House of Delegates

152 25

50

75

100

125

150

175

Bills Supported by the Chamber

14

PASSED

60

TOTAL

35

70

Bills Opposed by the Chamber 5

PASSED

75 30

TOTAL 60

93% 7 This report is produced as a service to our members. PLEASE DO NOT DISTRIBUTE.

90

KILL RATE

Letters of information submitted

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Maryland Chamber of Commerce 2025 Legislative Report

Business Regulations & Operations This policy committee looks at issues that benefit the employer-employee relationship and allow businesses to be competitive with their workforce. They address regulatory issues affecting daily operational activities and support legislation that allows market force principles to work in the state’s economy.

House Bill 227/Senate Bill 561 Corporations and Associations – Electric Cooperatives – Nonescheat Capital Credits MD Chamber Position: Support MD Chamber Policy Committee: Business Regulations & Operations Final Status: Approved by the Governor – Chapters 212 & 213

CHAMBER SUPPORTED

PASSED

House Bill 227/ Senate Bill 561 (HB 227/SB 561) clarifies that certain unclaimed money held by an electric cooperative and due to a past member is not abandoned property. It authorizes an electric cooperative to use this money to assist members of the cooperative or donate to nonprofit or charitable organizations.

HB 227/SB 561 allows for the unclaimed funds to further serve the community through education and workforce development programs, creating infrastructure and incentives that benefit the environment, and implementing pilot programs. In addition, the passage of HB 227/SB 561 aligns Maryland electric cooperatives with those in 37 other states.

HB 227 was heard in the House Economic Matters Committee and SB 561 was heard in the Senate Judicial Proceedings Committee and were signed into law by Governor Moore on April 22.

House Bill 577/Senate Bill 664 Business Regulation – Enforcement for Miscellaneous State Business Licenses – Study MD Chamber Position: Support with Amendment MD Chamber Policy Committee: Business Regulations & Operations Final Status: Approved by the Governor – Chapters 632 & 633

CHAMBER SUPPORTED

PASSED

House Bill 577/Senate Bill 664 (HB 577/SB 664) requires the Comptroller to study and make recommendations on the enforcement process for miscellaneous state business licenses. The Comptroller is to consult with stakeholders including the Maryland Chamber of Commerce, Maryland Retailers Alliance, and the Restaurant Association of Maryland as they undergo the study.

As introduced, the bill sought to streamline the enforcement and penalties process by requiring a business license applicant to designate an individual as the license representative, who would be subject to certain penalties for license violations. The Chamber advocated for amendments to create more certainty, reduce confusion, and ensure that liability remains with the business owner rather than a third-party employee.

HB 577/SB 664 ultimately was amended into a study by the legislature and was signed into law by Governor Moore on May 20.

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Maryland Chamber of Commerce 2025 Legislative Report

Business Regulations & Operations (cont.)

House Bill 591 Statute of Limitations – Prosecution or Enforcement of Local Consumer Protection Codes MD Chamber Position: Oppose MD Chamber Policy Committee: Business Regulations & Operations Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 591 (HB 591) sought to increase the statute of limitations for prosecuting or enforcing of local consumer protection codes from one year to three years, with the time frame beginning from when local authorities knew or should have reasonably known of a violation.

Extending the statute of limitations based on when local authorities become aware of a violation could create prolonged uncertainty for businesses and individuals, exposing them to criminal and civil liability for actions that occurred years earlier. The Chamber advocated to remove the provision linking the statute of limitations to when authorities knew or should have known of the violation, and to instead start the clock after the offense was committed, which would align with state law.

HB 591 passed out of the House Judiciary Committee and crossed over to the Senate but was not voted on by the Senate Judicial Proceedings Committee.

House Bill 1038/Senate Bill 496 Department of Commerce – Complaint Portal and Annual Report MD Chamber Position: Support MD Chamber Policy Committee: Business Regulations & Operations Final Status: Failed House Bill 1038/Senate Bill 496 (HB 1038/SB 496) would have required the Maryland Department of Commerce to establish a portal on the Department’s website to receive complaints from businesses and individuals who have waited longer than 60 days to receive licenses, forms, certificates, permits, or registrations.

The Maryland Chamber consistently hears from businesses across the state that have experienced prolonged waiting periods for building permits and licenses. Slow permitting and licensing times restrict development and drive investment to other states.

HB 1038/SB 496 did not progress out of their respective committees.

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Maryland Chamber of Commerce 2025 Legislative Report

Civil Liability We believe the civil law system should not punish lawful commerce. Issues related to tort reform and civil liability are of interest, including opposing efforts to expand liability and damages that weaken businesses’ defenses.

House Bill 113/Senate Bill 584 Civil Actions – Noneconomic Damages – Personal Injury and Wrongful Death MD Chamber Position: Oppose MD Chamber Policy Committee: Civil Liability Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 113/Senate Bill 584 (HB 113/SB 584) would have repealed certain limitations on noneconomic damages in civil actions for personal injury or wrongful death.

As introduced, this legislation sought to remove Maryland’s cap on noneconomic damages. For employers, this legislation would have caused property and casualty insurance rates and premiums to increase due to the greater liability exposure this higher limit on noneconomic damages would bring. This would have been especially problematic for small businesses with razor-thin revenue margins. The bill would have resulted in more frequent and excessive verdicts, lengthier appeals, and greater financial strain on small businesses and vulnerable communities. The current limits on noneconomic damages help maintain a stable business environment.

Neither bill passed out of their respective committees.

Victory Spotlight: Stopping Unlimited Liability The Threat: Lawmakers proposed eliminating Maryland’s caps on non-economic damages — exposing every business to unlimited financial liability.

The Impact: • Unlimited lawsuit exposure for all Maryland businesses • Skyrocketing insurance premiums • Job losses and business closures • Companies fleeing to protected states Our Response: The Maryland Chamber mobilized businesses statewide, educated lawmakers on the real-world consequences of the proposal, leveraged trusted relationships in Annapolis, and partnered with industry leaders to present a unified front.

The Result: The bill was defeated.

Why This Matters: Every restaurant, contractor, healthcare provider, manufacturer and service company in Maryland was protected by this victory — whether they knew it or not. But the fight isn’t over. Proponents are regrouping and planning their next move.

Your business benefited from this protection. Will you help defend it next time?

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Maryland Chamber of Commerce 2025 Legislative Report

Civil Liability (cont.)

House Bill 594 Civil Actions – Motor Vehicle Accidents Involving Vulnerable Individuals – Comparative Negligence MD Chamber Position: Oppose MD Chamber Policy Committee: Civil Liability Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 594 (HB 594) sought to alter Maryland’s current standard of contributory negligence by creating a separate comparative fault standard for motor vehicle accidents if the plaintiff was a vulnerable road user at time of the accident.

The Maryland Chamber has consistently stated its strong support for retaining the common law doctrine of contributory negligence because of the significant, negative economic effects a shift away from this doctrine would have on Maryland’s economic climate. A shift to comparative fault would result in more lawsuits, higher costs, and higher insurance premiums for Maryland’s employers and employees.

HB 594 was heard in the House Judiciary committee and did not receive a vote.

House Bill 778/Senate Bill 630 Circuit Court Judges – Selection and Retention Elections MD Chamber Position: Support MD Chamber Policy Committee: Civil Liability Final Status: Failed House Bill 778/Senate Bill 630 (HB 778/SB 630) would have amended the Maryland Constitution related to the selection and tenure of circuit court judges and would have changed the method of filing vacancies. Currently, judicial judges and Governor appointees are required to go through an extensive vetting process, ensuring that only those who are qualified and have the proper experience will serve on the court. However, challengers face no such vetting requirements. This legislation would have ensured that every judge is thoroughly vetted and fully qualified before taking office.

Maryland businesses who are parties to litigation can be adversely impacted by trial outcomes in situations where the judge lacks qualification or experience in interpreting and administering business and contract law.

HB 778 was heard in the House Judiciary Committee and SB 630 was heard in the Senate Judicial Proceedings Committee, but neither bill advanced.

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Maryland Chamber of Commerce 2025 Legislative Report

Civil Liability (cont.)

CHAMBER OPPOSED

House Bill 1099

FAILED

Civil Actions – Punitive Damage Awards – Surcharge MD Chamber Position: Oppose MD Chamber Policy Committee: Civil Liability Final Status: Failed

House Bill 1099 (HB 1099) aimed to lower the standard for imposing punitive damages in Maryland, replacing the “malice” requirement with a “gross negligence” standard, which could allow for punitive damages in cases of simple negligence. This change contradicts Maryland Supreme Court precedent, potentially leading to higher and more frequent punitive damage awards. Additionally, the bill introduced a 50% surcharge on punitive damages, with the funds allocated to public schools, creating an incentive for jurors to award punitive damages for financial gain rather than justice. This could have resulted in excessive awards and negative consequences for Maryland businesses and residents, disrupting the legal system’s balance.

HB 1099 was not voted out of the House Judiciary Committee.

House Bill 1274/Senate Bill 985

Senate Bill 642

Consumer Protection – Third-Party Litigation Financing MD Chamber Position: Support MD Chamber Policy Committee: Civil Liability Final Status: Failed

Courts – Prohibited Liability Agreements – Indoor Trampoline Parks MD Chamber Position: Support MD Chamber Policy Committee: Civil Liability Final Status: Failed

House Bill 1274/Senate Bill 985 (HB 1274/SB 985) would have reformed third-party litigation financing (TPLF) to facilitate transparency in litigation and limit the damage the unregulated world of TPLF has on the fair and efficient administration of justice. Specifically, SB 985 requires commonsense guardrails around the use of TPLF, including mandatory disclosure of TPLF agreements, increased discoverability of those arrangements in lawsuits, and state-level regulation of funders. TPLF involves investors financing lawsuits for a high return, often leading to conflicts of interest as litigation becomes driven by profit rather than the interests of the parties involved. This bill aimed to prevent funders from controlling cases solely for financial gain.

Senate Bill 642 (SB 642) was introduced to amend legislation passed in 2024 that broadly prohibits commercial recreational facilities from including provisions in contracts or waivers containing liability protection in instances of bodily harm at recreational facilities.

HB 1274 and SB 985 received hearings in their respective committees but were not voted on.

SB 642 sought to narrow the scope of the 2024 law by applying it only to indoor trampoline parks — the original focus of the legislation — rather than to all recreational facilities. The bill responded to concerns from small businesses across the state that can no longer use liability waivers to protect themselves from negligent claims, despite the inherent risks involved in many recreational activities.

SB 642 was heard in the Senate Judicial Proceedings Committee but did not receive a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Cyber & Technology This policy committee works to promote the development of policies that encourage and facilitate growth, entrepreneurship and innovation within the cyber and technology sectors, an important and growing industry area of Maryland’s economy.

House Bill 107/Senate Bill 49 Consumer Protection – Automatic Renewals MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Approved by the Governor – Chapters 204 & 205 House Bill 107/Senate Bill 49 establishes new consumer protection requirements for automatic renewals of subscriptions and purchase agreements. It mandates that businesses clearly disclose renewal terms, provide advance notice before renewals take effect, and offer consumers certain methods to cancel subscriptions. Violations are classified as unfair or deceptive trade practices under Maryland law.

The Maryland Chamber appreciates the intent of HB 107/SB 49, as Maryland businesses and consumers benefit from clear requirements for paid subscriptions that allow services to be offered without interruption to consumers. However, we were concerned over a lack of clear definitions for terms like “promptly” and “easy to find”, leading to potential confusion or inconsistent enforcement. This law could also create challenges for businesses by requiring Marylandspecific changes to user interfaces. The Chamber advocated for aligning Maryland’s regulations with proven frameworks from other states and successfully obtained several amendments to the legislation.

HB 107 and SB 49 each passed out of their respective chambers and were signed into law by Governor Moore on April 22.

House Bill 208 Consumer Protection – False Advertising – Digital Goods MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Approved by the Governor – Chapter 206 House Bill 208 (HB 208) prohibits a seller from advertising or offering a sale of a digital good using certain terminology unless, before executing the sale, an affirmative acknowledgment is received from the purchaser, or the seller provides the purchaser with a required disclosure statement. A violation of this Act constitutes an unfair or deceptive trade practice under Maryland law.

California is currently the only other state in the country with a similar law. The Maryland Chamber advocated to ensure there isn’t a patchwork of regulations that creates compliance challenges for businesses operating across multiple states — especially when it comes to how digital goods are marketed and presented online. We successfully advocated for amendments to remove criminal penalties and address the timing and flow of the online checkout process to better align Maryland’s law with California’s.

HB 208 passed out of the House and Senate with amendments and was signed into law on April 22.

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Maryland Chamber of Commerce 2025 Legislative Report

Cyber & Technology (cont.)

House Bill 322/Senate Bill 659 Consumer Protection – Electronic Funds Transfers – Regulations (Elder Fraud Prevention Act of 2025) MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 322/Senate Bill 659 (HB 322/SB 659) would have authorized the Commissioner of Financial Regulation to adopt consumer protection regulations for financial institutions initiating domestic electronic funds transfers. The Maryland Chamber had concerns that Maryland’s financial institutions, which include small credit unions and banks, would be negatively impacted by the imposition of these new regulations. Efforts to increase consumer protection for electronic fund transfers should foster compliance and ensure that financial institutions don’t limit the provision of critical services in the state.

HB 332 passed out of the House, and SB 659 received a hearing in the Senate Finance committee, but the Senate did not advance either bill.

House Bill 414 Health and Taxation – Digital Social Media Services and Mental Health Care Fund for Children and Youth MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 414 (HB 414) sought to impose a digital social media gross revenues tax on annual revenues derived from digital social media services and require the Comptroller to distribute revenue from the tax in a certain manner. It would have also established the Mental Health Care Fund for Children and Youth.

HB 414 would have been difficult to implement for both taxpayers and governments. In addition, there are sourcing, privacy, and data storage capacity concerns, as well as conflicting laws regarding other state privacy rules. The greatest concern to the Chamber is that the economic burden of the legislation would be borne by Maryland businesses and consumers, along with the ongoing legal issues that continue to play out following the passage of the Digital Advertising Gross Revenues Tax. House Bill 414 was heard in the House Ways and Means Committee and was not voted out of committee.

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Maryland Chamber of Commerce 2025 Legislative Report

Cyber & Technology (cont.)

CHAMBER OPPOSED

House Bill 626

FAILED

Real Estate Development and Highway Rights-of-Way – Installation of Broadband Micro Conduits and Microducts MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Failed

House Bill 626 (HB 626) would have significantly increased the cost of installing high-speed internet to unserved households across Maryland. Specifically, HB 626 would require a buried fiber optic cable installed in a highway right-ofway to include a certain type of conduit that contains at least seven microducts. HB 626 would then require the microduct to be made available to other broadband companies by the local government or Maryland Department of Transportation, for which the government could recover a fee.

This proposed legislation would have increased the conduit costs by 800%, significantly increasing the cost of services offered by broadband companies, which include access to internet. HB 626 was withdrawn by the Sponsor before receiving a hearing.

House Bill 956

CHAMBER SUPPORTED

PASSED

House Bill 823

CHAMBER OPPOSED

FAILED

Consumer Protection – Workgroup on Artificial Intelligence Implementation MD Chamber Position: Support MD Chamber Policy Committee: Cyber & Tech Final Status: Approved by Governor – Chapter 105

Generative Artificial Intelligence – Training Data Transparency MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Tech Final Status: Failed

House Bill 956 (HB 956) establishes the Workgroup on Artificial Intelligence (AI) Implementation and requires the workgroup to establish recommendations regarding the regulation of AI used in decisions that significantly impact the livelihood and opportunities of individuals in the State. Additionally, HB 956 requires the workgroup to make recommendations regarding deployer and developer obligations related to labor and employment, protection of individual privacy rights, protection of consumer rights, and current private sector use of AI.

House Bill 823 (HB 823) sought to require developers that release or substantially modify a generative artificial intelligence (AI) system to subsequently post on the developer’s website specified information detailing the data and datasets used to train the generative AI system.

AI is a new and evolving industry that has the potential to benefit all Marylanders. As such, the Maryland Chamber supports studying AI implementation and regulation before broad policies are established that could deter AI investment and creation in Maryland.

The Maryland Chamber is unaware of any other state in the country that has required the level of public disclosure contemplated by HB 823. We were concerned that this legislation would disincentivize investment within Maryland’s AI industry, make it less likely for AI systems to be utilized in the State, and ultimately restrict a burgeoning industry at a time when Maryland needs more economic growth.

HB 823 did not get voted out of the House Economic Matters Committee.

HB 956 was signed into law by Governor Moore on April 22.

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Maryland Chamber of Commerce 2025 Legislative Report

Cyber & Technology (cont.)

House Bill 1089/Senate Bill 904 Data Brokers – Registry and Gross Income Tax (Building Information Guardrails Data Act of 2025) MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1089/Senate Bill 904 (HB 1089/SB 904) would have introduced a data broker registry and data broker tax, which would have negatively impact businesses by imposing a tax on business inputs, violating key tax policy principles like transparency, fairness, economic neutrality, and competitiveness. This tax could have led to pyramiding, where multiple intermediate taxes are imposed, raising the effective tax rate on final goods. As a result, businesses likely would have needed to raise prices or scale back operations in Maryland to stay competitive. Industries that rely heavily on data, such as the insurance sector, would also have been significantly affected.

HB 1089 and SB 904 were both heard in their respective committees but were not brought up for a vote.

House Bill 1331 Consumer Protection – Artificial Intelligence MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1331 (HB 1331) aimed to implement strict regulations around the use of artificial intelligence (AI) technology, including requirements on developers and businesses that deploy AI to make decisions. HB 1331 introduced a host of concerns from the business community, including definitional issues, disclosure requirements, impact assessment requirements, enforcement mechanisms, and a private right of action. The requirements and assumed liability under this legislation would unintentionally stifle innovation and place Maryland businesses at a competitive disadvantage.

Businesses are committed to responsible AI development and use, and we support a regulatory framework that is sound and sufficient to establish protections without stifling innovation.

HB 1331 was heard in the House Economic Matters Committee but did not advance.

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Maryland Chamber of Commerce 2025 Legislative Report

Cyber & Technology (cont.)

House Bill 1365 Commercial Law – Online Data Privacy – Limits on Data Collection MD Chamber Position: Support MD Chamber Policy Committee: Cyber & Technology Final Status: Failed House Bill 1365 (HB 1365) sought to make a technical correction to the state’s comprehensive Data Privacy Act, which passed in 2024, by limiting the collection of personal data to what is adequate, relevant, and reasonably necessary for the purposes of which the data is processed.

HB 1365 would have addressed the strict data minimization requirement prior to Maryland’s data privacy law taking effect on October 1, 2025 by ensuring that data collection practices are reasonably necessary for a legitimate business purpose and relevant to consumers. Currently, Maryland’s data privacy law limits the collection of all personal data to a specific product that is requested by the consumer.

This legislation struck a reasonable balance between the operational needs of businesses and consumer protection, aligning with existing data privacy laws.

HB 1365 was heard in the House Economic Matters Committee and did not receive a vote.

Senate Bill 936 Consumer Protection – High-Risk Artificial Intelligence – Developer and Deployer Requirements MD Chamber Position: Oppose MD Chamber Policy Committee: Cyber & Technology Final Status: Failed

CHAMBER OPPOSED

FAILED

Senate Bill 936 (SB 936) would have addressed algorithmic discrimination in high-risk artificial intelligence (AI) systems by imposing new disclosure and impact assessment requirements, while also granting authority to the Attorney General to enforce the act.

SB 936 would have required developers to notify consumers when AI systems are used for consequential decisions, creating a significant compliance burden and discouraging AI innovation due to high costs. The bill likely would have overwhelmed consumers with frequent disclosures, leading to “disclosure fatigue” and undermining transparency.

Additionally, the private right of action provision exposed businesses to litigation before they could fully adjust to the new and extensive disclosure requirements before the short implementation deadline. While the intent of the bill is appreciated, further study and collaboration with industry stakeholders is needed for effective implementation.

SB 936 did not advance out of the Senate Finance Committee.

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Maryland Chamber of Commerce 2025 Legislative Report

Education & Workforce Development The Education and Workforce Development policy committee promotes policies that foster an educational and vocational system focused on developing, retaining and attracting a more globally competitive workforce.

House Bill 545/Senate Bill 398 Criminal Procedure – Automated Expungement MD Chamber Position: Support MD Chamber Policy Committee: Education & Workforce Development Final Status: Failed House Bill 545/Senate Bill 398 (HB 545/SB 398) aimed to improve access to criminal record sealing by automating the process for certain misdemeanors, except for domestic violence and second-degree assault convictions, for individuals who remain crime-free. With Maryland facing a severe labor shortage, this legislation would have helped employers access a larger, underutilized workforce by removing the barriers to sealing criminal records.

The Maryland Chamber believes in the importance of second chance employment, both for developing our state’s workforce and for uplifting our communities. Over 400,000 Marylanders are eligible for record sealing but are currently hindered by an expensive and complex process. By facilitating easier access to employment for justice-impacted individuals, HB 545/SB 398 would have benefited businesses, reduced turnover, and strengthened Maryland’s economy.

HB 545 was heard in the House Judiciary Committee and SB 398 was heard in the Senate Judicial Proceedings Committee and neither received a vote.

House Bill 785 Common Ownership Communities and Zoning Authorities – Operation of Family Child Care Homes – Limitations MD Chamber Position: Support MD Chamber Policy Committee: Education & Workforce Development Final Status: Approved by the Governor – Chapter 375

CHAMBER SUPPORTED

PASSED

House Bill 785 (HB 785) prohibits certain provisions in documents of cooperative housing corporations or homeowners’ associations that restrict or prohibit the establishment and operation of family childcare homes. It also prevents local jurisdictions from limiting the number of children a family childcare home can care for below the state’s authorized limit.

The Maryland Chamber of Commerce supported this bill as a critical step to address the childcare crisis, which is a major barrier to workforce participation. With many Maryland counties considered “childcare deserts,” the lack of affordable, accessible care, especially for infants and toddlers, is negatively impacting the state’s labor market and economy. This legislation will help increase childcare availability, supporting workforce participation and economic growth.

HB 785 was signed into law by Governor Moore on May 6.

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Maryland Chamber of Commerce 2025 Legislative Report

Education & Workforce Development (cont.)

House Bill 682/Senate Bill 452 Child Care Affordability Commission – Establishment MD Chamber Position: Support MD Chamber Policy Committee: Education & Workforce Development Final Status: Referred to Interim Study by Ways and Means House Bill 862/Senate Bill 452 (HB 862/SB 452) sought to establish the Child Care Affordability Commission to study and make recommendations regarding barriers to child care affordability in Maryland. The Commission would have had to consider certain economic measures to support working families. The Maryland Chamber of Commerce supports initiatives that increase access to childcare, incentivize more childcare providers to operate in Maryland, and increase childcare options for Marylanders. We were also named as a member of the Commission in this legislation.

HB 862 was heard by the House Ways and Means Committee, who voted to refer the bill to an interim study. SB 452 was heard in the Senate Education, Energy and the Environment Committee and was not brought up for a vote.

House Bill 1047/Senate Bill 325 Income Tax – Credit for Employers of Eligible Apprentices – Alterations MD Chamber Position: Support MD Chamber Policy Committee: Education & Workforce Development Final Status: Failed House Bill 1047/Senate Bill 325 (HB 1047/SB 325) would have promoted participation in the State’s registered apprenticeship programs by extending the termination date of the apprenticeship income tax credit by six years.

Registered apprenticeships connect Marylanders with sustainable employment opportunities, create economic opportunities, and generate economic mobility. Many of the Maryland Chamber’s members employ registered apprentices, and we have consistently supported policies that expand access and participation in registered apprenticeships in pursuit of Governor Moore’s established apprenticeship goals for Maryland.

Both bills were heard in their respective committees but did not receive a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment This policy committee advocates for energy and environmental policies that support a reliable, affordable and diverse energy portfolio, promote sustainability and innovation, and preserve Maryland’s natural resources. The committee works to ensure that environmental and climate goals are advanced in tandem with the state’s economic and competitiveness needs.

House Bill 49/Senate Bill 256 Environment – Building Energy Performance Standards – Alterations MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Enacted under Article II, Section 17(c) of the Maryland Constitution – Chapter 844 As introduced, House Bill 49/Senate Bill 256 (HB 49/SB 256) proposed an alternative compliance fee for buildings that fail to meet Energy Use Intensity (EUI) standards in the state’s Building Energy Performance Standards regulation (BEPS), along with a $100 annual emissions reporting fee building owners must pay when submitting their emissions data to the Maryland Department of the Environment (the Department).

Our primary concern was the lack of clarity on how the alternative compliance fees would be calculated and the absence of EUI standards in the state’s regulations, making it impossible for building owners to plan or assess compliance costs.

Ultimately, HB 49 was amended to exempt hospitals and sensitive compartmented information facilities from BEPS. Manufacturing buildings, already exempt under the Climate Solutions Now Act, had the definition amended to match the entirety of the state’s definition in existing law, which includes research and development. The $100 reporting fee remained, and Montgomery County’s existing BEPS program was grandfathered in, exempting its buildings from dual compliance. Study language was also added to evaluate a BEPS program based on greenhouse gas emissions, EUI, or a combination of both.

The Chamber was pleased with the final posture of HB 49. Our goal is to ensure that the BEPS program is clear and achievable, allowing businesses, building owners, electricity consumers and energy providers to comply efficiently – without undue burden and significant, unmanageable cost increases.

Governor Moore allowed HB 49 to go into effect without his signature.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

House Bill 128/Senate Bill 149 Climate Change Adaptation and Mitigation – Total Assessed Cost of Greenhouse Gas Emissions – Study and Reports MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Vetoed by the Governor

CHAMBER OPPOSED

VETOED

As introduced, House Bill 128/Senate Bill 149 (HB 128/SB 149) would have established a Climate Change Adaptation and Mitigation Program that would require businesses in the fossil fuel and petroleum sectors to make payments to fund climate change projects and health initiatives. It would have applied retroactively back to 1994, imposing potential liabilities in the billions of dollars for past legal activities.

The Maryland Chamber had concerns over the strict liability and retroactive application of liability in the bill as introduced, along with the precedent it would set by singling out one segment of the economy to bear large, excessive costs. The legislation was amended into a study requiring the Comptroller to assess the total cost of greenhouse gas emissions in the state and report findings by December 1, 2026.

Governor Moore vetoed this legislation on May 16 citing the state’s current fiscal and budget constraints.

Senate Bill 212 Maryland Building Performance Standards – Fossil Fuel Use and Electric-Ready Standards MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 212 would have required the Maryland Department of Labor to adopt, on or before January 1, 2026, and as part of the Maryland Building Performance Standards, a requirement that new buildings meet all energy demands of the building without the use of fossil fuels and an electric-ready standard for certain buildings.

This legislation would have severely restricted the availability of affordable energy options for all new buildings in the state. It would have also placed Maryland at a significant regional economic competitiveness disadvantage by ultimately phasing out the use of other affordable energy sources for commercial buildings that are critical to every jurisdiction in our state. Additionally, it brought forward legal concerns. In April of 2023, the U.S. Court of Appeals for the Ninth Circuit held that the Energy Policy and Conservation Act (EPCA) preempts state and local building codes concerning the energy use of natural gas appliances, including Berkeley’s building code which prohibits natural gas piping into new buildings, preventing the use of natural gas. In January 2024, the Ninth Circuit denied Berkeley’s request for review and the panel’s decision, which struck down Berkeley’s ordinance, was reaffirmed.

This bill was heard in the House Environment and Transportation Committee and was not voted out of committee.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

House Bill 340 Climate Change – Attorney General Actions, Climate Change Restitution Fund and Climate Change Restitution Fund Advisory Council MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 340 (HB 340) would have allowed the Maryland Attorney General to investigate and prosecute publicly traded entities with a market capitalization greater than $1 billion for unlawful conduct contributing to climate change, including through fraud or “inaction.” The Maryland Chamber of Commerce expresses serious concerns about the bill’s vague and broad definition of “unlawful conduct,” which could potentially apply to almost any business practice, creating uncertainty and risk for businesses. Additionally, the bill allowed for unlimited spending on outside counsel, potentially draining state finances. Given Maryland’s existing climate change regulations and the fragile state of global energy markets, the Chamber was concerned this bill would hinder economic growth and create unnecessary legal and financial burdens.

HB 340 did not receive a vote from the House Health and Government Operations Committee.

House Bill 903 Courts – Global Warming and Climate Change – Prohibited Actions (Ratepayer Protection Act of 2025) MD Chamber Position: Support MD Chamber Policy Committee: Energy & Environment Final Status: Failed House Bill 903 (HB 903) sought to prohibit the state, local governments, or their agencies from filing actions for monetary damages against businesses for the alleged adverse effects of global warming or climate change. Maryland businesses continue to make significant investments in clean energy, sustainability, and environmental compliance, yet there are increasing efforts to assign financial liability to private companies for climate change damage through litigation. Courts around the country have ruled against climate-related lawsuits. Meanwhile, the uncertainty created by these lawsuits discourages investment, job creation, and economic growth, increasing costs for Maryland businesses and consumers.

HB 903 was heard in the House Judiciary Committee but did not advance out of committee.

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PAGE 18

Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

House Bill 973/Senate Bill 804 Maryland Building Performance Standards – Fossil Fuel Use, Energy Conservation and Electric- and Solar-Ready Standards (Better Buildings Act of 2025) MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 973/Senate Bill 804 (HB 973/SB 804) would have required the Maryland Department of Labor to adopt, as part of the Maryland Building Performance Standards, a requirement that new buildings and significant improvements of buildings and structures meet all water and space heating demands of the building or structure without the use of fossil fuels, meet energy conservation requirements, and meet an electric- and solar-ready standard for certain buildings.

This bill would have severely restricted the availability of affordable energy options for all new buildings in the state. It also places Maryland at a significant regional economic competitiveness disadvantage by ultimately phasing out the use of other affordable energy sources for buildings that are critical to every jurisdiction in our state. This bill set Energy Use Intensity standards that lacked clarity, as it remains uncertain how these standards would be applied on a building-bybuilding basis or whether they are realistically achievable.

Along with legal concerns, it failed to account for customer choice and could have led to affordability and reliability issues.

We believe that legislation aimed at reducing greenhouse gas emissions must be comprehensive, inclusive of innovative technologies, and mindful of federal regulations to ensure a sustainable and prosperous energy future for Maryland.

HB 973 and SB 804 received hearings in their respective committees and were not brought up for a vote.

House Bill 1035/Senate Bill 937 Electricity and Gas – Emissions Reductions, Rate Regulation, Cost Recovery, Infrastructure, Planning, Renewable Energy Portfolio Standard and Energy Assistance Programs (Next Generation Energy Act) MD Chamber Position: Letter on Information MD Chamber Policy Committee: Energy & Environment Final Status: Approved by the Governor – Chapters 625 & 626 House Bill 1035/Senate Bill 937 (HB 1035/SB 937) was introduced to enhance Maryland’s energy security by accelerating the transition to cleaner in-state electricity generation, ensuring large energy users contribute to the cost of distribution and transmission, and establishing a new procurement process for nuclear energy projects.

The bill received a number of amendments throughout the legislative session. As passed, HB 1035/SB 937 directs the Public Service Commission to approve dispatchable energy projects to replace coal and oil, aiming to ensure grid stability and reduce reliance on out-of-state power. It also establishes a nuclear energy procurement process, promotes regional and federal partnerships for new nuclear facilities, and expedites permitting for energy projects like solar and battery storage. Additionally, the bill requires large energy users to contribute to grid costs unless they build or expand their own generation capacity.

The Maryland Chamber supports the bill’s goals of improving energy reliability and affordability while ensuring sufficient in-state generation. However, we advocated for a balanced, industry-informed approach that considers the needs of businesses affected by these changes to support effective energy policies.

HB 1035 and SB 937 passed out of their respective chambers and were signed into law on May 20.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

House Bill 1058 Emission Standards, Ambient Air Quality Standards and Solid Waste Management – Local Authority MD Chamber Position: Letter of Information MD Chamber Policy Committee: Energy & Environment Final Status: Failed House Bill 1058 (HB 1058) would have altered the authority of political subdivisions to adopt ordinances, rules, or regulations related to emission and ambient air quality standards under certain conditions.

The Maryland Chamber believes that policies affecting infrastructure and environmental standards should be managed at the state level to maintain a consistent and predictable regulatory framework for both businesses and residents. A statewide approach prevents the complexity and uncertainty of varying local regulations that could increase costs, cause delays, and hinder the development of critical infrastructure.

HB 1058 was heard in the House Environment and Transportation Committee but was not voted on.

House Bill 1088/Senate Bill 882 Coal Transportation Fee and Fossil Fuel Mitigation Fund (Coal Dust Cleanup and Asthma Remediation Act) MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1092 Recycling – Prohibition on the Chemical Conversion of Plastic MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Failed

CHAMBER OPPOSED

FAILED

HB 1088/SB 882 would have imposed a significant tax burden on Maryland businesses relying on coal for essential daily operations. We also had concerns over the burden this could place on the Port of Baltimore, a major economic driver for the state, where coal frequently enters. At a time when Maryland is facing growing energy challenges, discouraging reliable energy sources felt counterproductive and risked increasing energy costs for businesses and consumers.

House Bill 1092 (HB 1092) sought to exclude certain chemical conversion processes, including pyrolysis and gasification, from the definition of recycling and would have banned the construction of facilities in Maryland that convert plastic to fuel or feedstock using these methods. This effectively would have banned advanced recycling technologies, which convert post-use plastics into new products, supporting sustainability and waste reduction goals.

The bill contradicted recommendations from the Extended Producer Responsibility Advisory Council and limited Maryland’s ability to achieve circular economy goals. While other states are encouraging these technologies, Maryland’s proposed ban could have hindered innovation and economic opportunity in the advanced recycling sector, which is valued at $120 billion nationwide.

HB 1088 and SB 882 were heard in their respective committees but did not advance.

HB 1092 was heard in the House Environment and Transportation Committee but did not receive a vote.

House Bill 1088/Senate Bill 882 (HB 1088/SB 882) proposed a $13 per ton coal transportation fee on a person or entity transporting coal into Maryland.

The revenue generated from this fee would have been allocated to a newly established Fossil Fuel Mitigation Fund.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

House Bill 1112 PFAS Chemicals – Civil Actions and Prohibition on Consumer Product Sales MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1112 (HB 1112) proposed a ban on the manufacturing, selling, or distribution of consumer products containing PFAS (per-and polyfluoroalkyl substances) by July 1, 2026. It also would have expanded civil liability by creating a new cause of action for PFAS exposure, with significantly extended statutes of limitations.

The bill’s broad definition of PFAS failed to account for well-established scientific differences in risk and toxicity among PFAS compounds, such as fluoropolymers, which pose minimal environmental or health hazards. Additionally, the legislation’s aggressive timeline and lack of regulatory framework presented major compliance challenges. The Chamber also opposed liability provisions, which expanded civil liability and conflicted with Maryland Workers’ Compensation laws, potentially subjecting employers to dual liability for workplace exposures.

PFAS are critical to the performance and safety of products used across essential industries, including technology, healthcare, alternative energy, building materials, automotive, and much more. HB 1112 would have disrupted supply chains, increased costs for consumers, and placed Maryland businesses at a competitive disadvantage. The Chamber advocates for a more balanced, science-based approach focused on high-risk PFAS and provides exemptions for essential uses in key industries.

HB 1112 was heard in the House Judiciary Committee but was not brought up for a vote.

House Bill 1273 Maryland Strategic Energy Investment Fund and Customer-Sited Solar Program – Alterations MD Chamber Position: Letter of Information MD Chamber Policy Committee: Energy & Environment Final Status: Failed House Bill 1273 (HB 1273) would have expanded the use of the Maryland Strategic Energy Investment Fund (SEIF) to include grants and loans for building and transportation electrification. It also sought to modify the allocation of Regional Greenhouse Gas Initiative auction and compliance fee revenue to support clean energy initiatives, including solar programs. Additionally, it would have altered the definition of “low-to-moderate income.”

While the Chamber did not oppose directing compliance fee revenue into SEIF, concerns remained about the financial burden imposed by the state’s Building Energy Performance Standards (BEPS) regulation, which places significant compliance costs on the building industry. The bill lacked clarity on how funds from compliance fee revenues would be reinvested to support building owners in meeting these standards. The Chamber urged that any funds collected from building owners for noncompliance with BEPS be reinvested to help offset the cost of achieving compliance.

HB 1273 was heard in the House Environment and Transportation Committee, passed out of the House, but failed to advance in the Senate.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

House Bill 1415 Environment – Building Energy Performance Standards and Energy Use Intensity Targets – Exemptions MD Chamber Position: Support MD Chamber Policy Committee: Energy & Environment Final Status: Failed House Bill 1415 proposed allowing for a delay in compliance with Maryland’s building energy performance standards (BEPS) until major building components, such as lighting or HVAC systems, need to be replaced due to failure or end of life. This approach balances Maryland’s energy and climate goals with the economic challenges faced by businesses and property owners, particularly in light of the significant financial burden of BEPS compliance. The bill aimed to phase in compliance more responsibly and sought to address concerns surrounding the high cost of retrofits, rising electricity costs, and potential impacts on grid reliability, making the transition toward decarbonization more feasible and sustainable.

The legislation was heard in the House Environment and Transportation Committee but was not voted on.

House Bill 1417/Senate Bill 480

House Bill 1451/Senate Bill 779

Department of General Services – Clean Energy Procurement Program – Establishment MD Chamber Position: Support MD Chamber Policy Committee: Energy & Environment Final Status: Failed

Climate Solutions Affordability Act of 2025 MD Chamber Position: Support MD Chamber Policy Committee: Energy & Environment Final Status: Failed

House Bill 1417/Senate Bill 480 (HB 1417/SB 480) would have created a Clean Energy Procurement Program within the Maryland Department of General Services to evaluate biogas as a complementary energy source for Maryland’s transportation and building sectors. The bill supported Maryland’s climate goals while ensuring energy reliability and affordability for businesses. By using existing waste streams, biogas helps reduce methane emissions and integrates into current energy infrastructure with minimal disruption. The bill emphasized a diversified energy strategy and competitive procurement to ensure greater fiscal responsibility and marketdriven outcomes.

HB 1417 and SB 480 were heard in their respective committees but did not advance.

House Bill 1451/Senate Bill 779 (HB 1451/SB 779) would have specified that requirements under the Climate Solutions Now Act of 2022 (CSNA) must be carried out to the extent economically practicable.

The CSNA established the most stringent climate goal in the nation – a 60% reduction in greenhouse gas emissions below 2006 levels by 2031 and netzero by 2045. Since it’s passage, Maryland businesses have faced significant compliance challenges related to the standards established in the CSNA. HB 1451/SB 779 introduced necessary economic practicability considerations into climate and energy requirements for businesses and public entities.

The legislation did not advance in neither the House or Senate.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

House Bill 1484/Senate Bill 978 Environmental Permits – Requirements for Public Participation and Impact and Burden Analyses (Cumulative Harms to Environmental Restoration for Improving Shared Health – CHERISH Our Communities Act) MD Chamber Position: Letter of Information MD Chamber Policy Committee: Energy & Environment Final Status: Failed House Bill 1484/Senate Bill 978 (HB 1484/SB 978) would have introduced additional environmental review requirements for projects within a 1.5-mile radius of at-risk communities, requiring applicants to submit an environmental impact analysis and, in some cases, a burden report.

The Maryland Department of the Environment could deny permits based on environmental impacts, and permit holders might be required to contribute to a mitigation fund. While the Chamber supports environmental equity and transparency in the permitting process, we expressed concern about delays in permitting, the lack of defined timelines, and the potential financial uncertainty caused by undefined fees. Businesses rely on timely permitting decisions to plan and execute projects, and prolonged delays could hinder economic growth and development in Maryland. Changes to the regulatory and permitting process must prioritize efficiency and reliability.

HB 1484 was heard in the House Environment and Transportation Committee, and SB 978 was heard in the Senate Education, Energy and the Environment Committee. Neither bill was brought up for a vote.

Senate Bill 807 Environment – Local Building Energy Performance Standards – Authorization MD Chamber Position: Oppose MD Chamber Policy Committee: Energy & Environment Final Status: Failed

CHAMBER OPPOSED

FAILED

Senate Bill 807 (SB 807) would have allowed counties to implement local building energy performance standards (BEPS) that are at least as stringent as state standards, with approval from the Maryland Department of the Environment.

While the bill aims to align state and local BEPS, it raised concerns about creating a fragmented regulatory landscape and patchwork approach of BEPS programs. The potential for up to 24 jurisdictions to adopt varying standards could lead to compliance challenges for businesses operating across multiple areas, increasing costs and creating uncertainty.

Additionally, the financial impact of compliance with state’s BEPS regulations is already projected to be substantial. The Chamber advocates for a more uniform and transparent regulatory process to avoid the complexity and financial strain that could result from inconsistent local regulations.

SB 807 was heard in the Senate Education, Energy and the Environment Committee but was not brought up for a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Energy & Environment (cont.)

Senate Bill 901 Environment – Packaging and Paper Products – Producer Responsibility Plans MD Chamber Position: Letter of Information MD Chamber Policy Committee: Energy & Environment Final Status: Approved by the Governor – Chapter 431 Senate Bill 901 (SB 901) introduces an extended producer responsibility program to Maryland by requiring producers of covered materials, including packaging and paper products, to submit a responsibility plan to the Maryland Department of the Environment by July 1, 2028, with subsequent plans every five years thereafter. The legislation also establishes a fee structure for producers and producer responsibility organizations.

While the Chamber acknowledges the bill’s intent to improve recycling and waste management, we highlighted a few key challenges, including the need for a thorough review of the recent needs assessment, opportunities to learn from other states like Oregon, a lack of clarity around fee structures and compliance costs, how the program could affect regional recycling partnerships, and the inclusion of greenhouse gas reduction goals. We encouraged continued dialogue with stakeholders to ensure the framework is effective, equitable, and practical for all parties.

SB 901 passed out of the Senate on March 17, received a hearing in the House Environment and Transportation Committee on March 27, and was passed by the full House on the final day of the legislative session. Governor Moore signed SB 901 into law on May 13.

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Maryland Chamber of Commerce 2025 Legislative Report

Health Care & Biopharma We believe in meaningful health care reform that allows employers to best meet the needs of their employees. We oppose mandated health benefit demands, as well as regulatory oversight and requirements. We also address issues in legislative interaction in the pharmacological discovery and development processes.

House Bill 321/Senate Bill 303 Pharmacy Benefits Managers – Definition of Purchaser and Alteration of Application of Law MD Chamber Position: Oppose MD Chamber Policy Committee: Health Care & Biopharma Final Status: Failed

CHAMBER CHAMBER OPPOSED OPPOSED

FAILED FAILED

House Bill 321/Senate Bill 303 (HB 321/SB 303) proposed changes to state law governing pharmacy benefit managers (PBMs) by repealing the existing definitions of “carrier” and “ERISA” and altering the definition of “purchaser”. These changes were intended to significantly expand the scope of how the state regulates PBMs to include more entities that administer pharmacy benefits on behalf of carriers, including those operating under the federal Employee Retirement Income Security Act of 1974 (ERISA).

HB 321/SB 303 would have had major impacts on both employers and employees throughout the state. With the majority of private sector employees participating in healthcare plans that are covered under ERISA protections, the Chamber urged the committee to avoid any legislative action that could increase healthcare costs for Marylanders and negatively impact the ability of employers and health plan providers to design affordable products for the Maryland healthcare market.

SB 303 was heard in the Senate Finance Committee and was not brought up for vote. HB 321 passed out of the House and crossed over to the Senate but did not receive a vote after the March 27 hearing.

House Bill 418/Senate Bill 437 Health Maintenance Organizations – Payments to Nonparticipating Providers – Reimbursement Rate MD Chamber Position: Oppose MD Chamber Policy Committee: Health Care & Biopharma Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 418/Senate Bill 437 (HB 418/SB 437) proposed to amend the reimbursement rates at which health maintenance organizations (HMOs) are required to pay nonparticipating health care providers, specifically adjusting the payment to 125% of the average rate as of January 31, 2019, with adjustments based on the Medicare Economic Index.

Currently, HMOs reimburse nonparticipating providers at either 140% of the Medicare rate or 125% of the previous year’s average rate.

The bill would have substantially raised the rates nonparticipating emergency service providers could bill HMOs, without offering any corresponding benefits to consumers. Additionally, there is already a formula for what an HMO must pay out of network, and patients are protected under federal law from unexpected costs of emergency services. This bill would have led to increased health care costs to employers and their employees without any increase in the quality of health care services.

HB 418 was withdrawn by the sponsor after the hearing. SB 437 was heard in the Senate Finance Committee but was not brought up for a vote.

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PAGE 25

Maryland Chamber of Commerce 2025 Legislative Report

Health Care & Biopharma (cont.)

House Bill 424/Senate Bill 357 Prescription Drug Affordability Board – Authority and Stakeholder Council Membership (Lowering Prescription Drug Costs for All Marylanders Now Act) MD Chamber Position: Oppose MD Chamber Policy Committee: Health Care & Biopharma Final Status: Approved by the Governor – Chapters 610 & 611 House Bill 424/Senate Bill 357 (HB 424/SB 357) requires the Prescription Drug Affordability Board (PDAB) to set upper payment limits for purchases and payor reimbursements of prescription drugs in Maryland, particularly for drugs that may cause affordability challenges.

While the Maryland Chamber supports enhancing drug accessibility and affordability, we oppose government-imposed price controls, as such measures could stifle innovation, discourage investment, and harm the state’s life sciences sector.

Maryland is home to over 2,700 life science businesses, generating over $18.6 billion in economic activity while benefiting from exceptional proximity to leading federal institutions, constituting one of the nation’s largest clusters. Governmentimposed upper price limits can create disparities in access to medicines and drive businesses to invest in more businessfriendly states. Additionally, the PDAB has not yet completed their initial work of setting upper payment limits on drugs for state health plans, so the passage of this legislation was premature, as it extends the Board’s authority before establishing a proven track record or demonstrating impact under its existing mandate.

Both bills passed and were signed into law by Governor Moore on May 20.

House Bill 926/Senate Bill 681 Health Care Malpractice Claims – Health Care Provider – Definition MD Chamber Position: Support MD Chamber Policy Committee: Health Care & Biopharma Final Status: Failed House Bill 926/Senate Bill 681 (HB 926/SB 681) would have clarified the definition of “health care provider” under the Maryland Health Care Malpractice Claims Act to include certain hospital employees, agents, or contractors who provide health services, such as x-ray technicians and respiratory care specialists. Currently, these individuals are not listed as “health care providers” under existing law.

The bill sought to ensure consistent and fair legal standards for all health professionals working in hospitals. The Maryland Chamber supported this targeted clarification, as it addresses a legal gap without over-extending the definition to non-medical personnel, ensuring fairness in malpractice lawsuits.

Both bills were heard in their respective committees but were not brought up for a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Health Care & Biopharma (cont.)

House Bill 1439/Senate Bill 760 Better Small Business Employee Benefit Act of 2025 MD Chamber Position: Support MD Chamber Policy Committee: Health Care & Biopharma Final Status: Failed House Bill 1439/Senate Bill 760 (HB 1439/SB 760) would have exempted health benefit plans offered through Professional Employer Organizations (PEOs) to small business clients from certain state requirements in Maryland.

PEOs provide a suite of services such as payroll, HR, workers’ compensation, and healthcare benefits, helping small businesses manage these tasks who often do not have the resources to administer employee benefits themselves.

Maryland is one of three states that does not allow PEOs to offer aggregated healthcare plans to their clients, unlike 47 other states and the District of Columbia.

HB 1439/SB 760 would have provided businesses the flexibility to explore PEO-provided health benefits, without mandating participation. The Maryland Chamber supported this legislation, recognizing its potential to improve access to affordable health benefits. By allowing PEOs greater flexibility to offer health coverage, the bill would have given businesses an additional option to provide competitive employee benefits. This would not only help reduce administrative burdens but also strengthen employers’ ability to attract and retain talent. We also supported ensuring appropriate regulatory safeguards for businesses that chose to partner with PEOs, striking a balance between increased access and market stability.

HB 1439 was heard in the House Health and Government Operations Committee, and SB 760 was heard in the Senate Finance Committee. The committees did not vote on the legislation.

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Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment This policy committee focuses on all issues pertaining to the relationship between employees and employers within the state. This committee promotes policies ensuring fairness and reducing excessive mandates.

House Bill 37 Declaration of Rights – Right to Organize MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 37 (HB 37) was introduced as a constitutional amendment that would have established a fundamental right for all employees in Maryland to organize and collectively bargain on matters concerning compensation, hours, and other conditions of employment.

This legislation would have significantly limited the state’s ability to regulate certain areas of law that would be covered in negotiated agreements between workers and employers. Additionally, it would restrict the state’s ability to modify laws on prevailing wages, union benefits, and workforce policies, and could prevent regulation of areas covered by union agreements with local jurisdictions. HB 37 lacked a mechanism to address unintended negative consequences if its language was added to Maryland’s Constitution. The National Labor Relations Act (NLRA) already governs collective bargaining, and confusion between the NLRA and this proposed constitutional amendment could have harmed both workers and employers.

HB 37 was heard in the House Appropriations Committee but did not advance out of committee.

House Bill 218/Senate Bill 195 Family Law – Child Support MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

The Maryland Chamber was primarily concerned with provisions in House Bill 218/Senate Bill 195 (HB 218/SB 195) that define the term “independent contractor” and would require employers to report personally identifiable information, like social security numbers, for independent contractors directly to the Child Support Administration at the Maryland Department of Human Services. The bill’s definition of an “independent contractor” and information gathering requirements would have created operational burdens for businesses across the state.

HB 218 and SB 195 did not move out of the House Judiciary Committee and Senate Judicial Proceedings Committee.

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PAGE 28

Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment (cont.)

CHAMBER OPPOSED

House Bill 233/Senate Bill 576 Labor and Employment – Mandatory Meetings on Religious or Political Matters – Employee Attendance and Participation (Maryland Worker Freedom Act) MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

FAILED

House Bill 233/Senate Bill 576 (HB 233/SB 576) aimed to prohibit Maryland employers from exercising its constitutional and statutory right to speak to its employees about religious matters and “political issues,” including proposals to change legislation, regulations or public policy, along with the decision to join or support any labor union.

The Maryland Chamber argued that this legislation violates constitutional rights, particularly the First and Fourteenth Amendments. The bill’s vague definitions could lead to arbitrary enforcement, and it directly conflicts with federal labor laws, particularly the National Labor Relations Act (NLRA), which protects employers’ rights to communicate about labor issues without fear of reprisal. This legislation would have also created legal uncertainty, discouraged investment, and harmed Maryland’s business climate.

HB 233 passed out of the House. SB 576 received a favorable report by Senate Finance, but it was recommitted to committee during the Senate floor session and failed to advance further.

House Bill 264/Senate Bill 218 Business Occupational and Professional Licenses – Suspension and Revocation for Workplace Fraud MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 264/Senate Bill 218 (HB 264/SB 218) would have required the Commissioner of Labor and Industry to notify a licensing authority when a licensee is found in violation of workplace fraud provisions. It would have also required the licensing authority to suspend or revoke the licenses of licensees who are reported by the Commissioner.

Both the House and Senate bills were withdrawn by the sponsor, which was the Maryland Department of Labor, before receiving hearings.

House Bill 393/Senate Bill 31 Commercial Law – Attachment of Wages – Exemptions (Exempt Income Protection Act) MD Chamber Position: Support with Amendment MD Chamber Policy Committee: Labor & Employment Final Status: Failed House Bill 393/Senate Bill 31 (HB 393/SB 31) requires employers who may not be party to an adjudicated debt to notify a judgment debtor of the amount of their wages that are not subject to a garnishment attachment, how the attachable wages were calculated, and the procedure by which the judgement debtor may contest the attachment.

The Maryland Chamber was concerned that this adds an unnecessary notice requirement for employers, who are already notifiers of garnishments, given that Maryland law already ensures judgment debtors receive sufficient notice and updates regarding their garnishment. HB 393/SB 31 would have imposed an additional burden on employers who are not directly involved in the adjudicated debt.

Both bills received hearings in their respective committees but did not receive a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment (cont.)

House Bill 582 Labor and Employment – Exemptions from Overtime Pay – Administrative, Executive, or Professional Capacity MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 582 (HB 582) would have codified a federal rule that was struck down in 2024, altering the current exemption from overtime pay for individuals employed in administrative, executive, or professional capacities. The bill would have increased costs for employers, limited job creation, and created payroll management challenges.

By adopting a salary threshold that is significantly higher than the federal standard, Maryland would have created a patchwork of regulations that would be difficult for employers to navigate. Additionally, by applying overtime laws to salaried office and management employees, HB 582 may have led to lower pay for many workers, as employers may reduce base salaries, assuming overtime compensation would offset the difference. However, if these employees do not receive overtime opportunities, they could end up earning less overall, creating significant challenges for both employers and employees.

HB 582 received a favorable report with amendments by the House Economic Matters Committee but was special ordered on the House floor and failed to progress further.

House Bill 632 Labor and Employment – Workplace Fraud – Application (Maryland Workplace Fraud Act of 2025) MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 632 (HB 632) was introduced to significantly expand Maryland’s Workplace Fraud Act by applying its provisions — which currently apply to the construction and landscaping industries — to all employers in the state. The Maryland Chamber opposed the bill due to the potential for broad, unintended consequences, especially on law-abiding businesses.

The Workplace Fraud Act already contains complex and stringent compliance requirements, and penalties under the law were increased as recently as last year. Expanding the statute to cover every industry would have created new legal exposure for a wide range of employers, many of whom are operating in full compliance with existing worker classification rules. This legislation would subject millions of additional workers to a law originally designed for specific, high-risk industries, risking false accusations of misclassification and creating additional administrative and legal burdens.

Rather than pursuing punitive approaches, we support efforts that help employers achieve compliance through education and collaboration with the state. HB 632 would have sent the wrong message to businesses looking to invest or grow in Maryland, reinforcing concerns about the state’s regulatory climate.

HB 632 was heard in the House Economic Matters Committee but did not receive a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment (cont.)

House Bill 824 Family and Medical Leave Insurance Program – Covered Individuals – Alternatively Qualified Individuals MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 824 (HB 824) would have allowed certain individuals who have earned at least $7,200 in total lifetime wages in Maryland to obtain paid benefits under the Family and Medical Leave Insurance (FAMLI) program. Eligible individuals would be entitled to benefits once per year in the amount of $2,000 for the 6-month period beginning July 1, 2027, and at an amount determined by the Maryland Department of Labor for the 12-month period beginning January 1, 2028 and each subsequent year thereafter.

In 2022, the Maryland General Assembly enacted the FAMLI Act with an expected $841.8 million in FY27 being taken from employers and employees to fund the program. Recent data shows that the program is now expected to take $1.838 billion from employers and employees to fund the program, with the expectation that the program is expected to cost up to $2 billion annually. HB 824 would have significantly expanded benefits, resulting in a further increase in the expected costs. Additionally, HB 824 proposed an “alternatively qualified” individual to include those who are unemployed, allowing those who are not employed and not contributing to the FAMLI trust fund to receive paid benefits under the program.

HB 823 was heard in the House Economic Matters Committee and received an unfavorable report.

House Bill 1096/Senate Bill 938 Fraud Prevention and Worker Protections – Prohibitions, Penalties and Enforcement MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1096/Senate Bill 938 (HB 1096/SB 938) was an Attorney General’s Office (OAG) departmental bill, which would have expanded the Workplace Fraud Act to all industries beyond construction and landscaping, and grants the OAG broad authority to enforce wage and hour laws and workplace fraud.

HB 1096/SB 938 would have created sweeping changes to Maryland’s employment law by establishing joint liability for any business that outsources a project, holding them financially responsible if a subcontractor misclassifies workers.

The bill’s broad definitions would have extended liability to businesses with little to no control over subcontractors’ employment practices — affecting every industry in the state. In addition to proposing excessive penalties and fines, it would have eliminated existing good faith compliance protections for employers and undermined reasonable cure periods currently offered. This legislation would have stifled economic growth, deterred entrepreneurship, placed significant liability on businesses, and led to increased costs for both businesses and consumers.

HB1096 was heard in the House Economic Matters Committee, and SB 938 was heard in the Senate Finance Committee.

Neither bill was brought up for a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment (cont.)

CHAMBER OPPOSED

House Bill 1261

FAILED

Employment Discrimination – Intent MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

House Bill 1261 (HB 1261) aimed to prohibit employers from taking actions with discriminatory effects, unless those actions are a legitimate business necessity and no less discriminatory alternatives exist.

While the Maryland Chamber appreciated the bill’s intent, the broad scope of HB 1261 could have led to unintended consequences, such as increased litigation and forum shopping, where plaintiffs choose the cause of action that provides the more favorable standard of proof. This would have also overwhelmed state courts with complex cases and limited the flexibility of workplace policies. We opposed HB 1261 to ensure that the Maryland Fair Employment Practices Act continues to provide robust protections without creating unintended consequences for employers and employees.

HB 1261 was heard in the House Economic Matters Committee and was not voted on.

House Bill 1288/Senate Bill 658 Labor and Employment – Noncompete and Conflict of Interest Provisions MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1288/Senate Bill 658 (HB 1288/SB 658) sought to clarify Maryland law to establish that noncompete provisions are avoid only after an employee separates from an employer.

In 2019, the Maryland General Assembly enacted House Bill 38, which did not clarify whether noncompete agreement restrictions apply only to agreements that take effect after an employee separates from an employer. To clarify what is commonly understood to be the case, this bill simply clarifies that noncompete restrictions apply after an employee separates from an employer. This important change clarifies that employees and employers may enter into agreements that prohibit current employees from directly competing with their employer.

House Bill 1400/Senate Bill 823 No Tax on Tips Act MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1400/Senate Bill 823 (HB 1400/SB 823) would have increased the minimum wage from $15 to $20 per hour by July 1, 2028, eliminated the state’s tip credit, imposed new disclosure requirements for service fees at food service establishments, and created a state income tax exemption for certain tipped wages while offering a limited employer tax credit.

While HB 1400/SB 823 purported to provide tax relief to tipped employees, it introduced significant burdens on Maryland’s businesses, particularly in the hospitality and service industries. These provisions would have led to higher consumer prices, lower take-home pay for tipped workers, and fewer job opportunities across the hospitality sector.

HB 1400 and SB 823 were heard in their respective committees, but neither received a vote.

SB 658 was heard in the Senate Finance Committee but did not advance out of committee. HB 1288’s hearing was canceled in the House Economic Matters Committee and did not get rescheduled.

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Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment (cont.)

CHAMBER SUPPORTED

House Bill 1340/Senate Bill 785 Labor and Employment – Unpaid Parental Leave – Definition of Employer MD Chamber Position: Support MD Chamber Policy Committee: Labor & Employment Final Status: Approved by the Governor – Chapter 296

PASSED

House Bill 1340/Senate Bill 785 (HB 1340/SB 785) addresses an overlap in employer coverage between Maryland’s Parental Leave Law and the federal Family and Medical Leave Act (FMLA) by clarifying that employers who are covered

by FMLA for the current year are not required to provide the same unpaid parental leave benefit established under Maryland law due to a shift in the number of the employer’s employees in a given year.

Maryland’s unpaid parental leave requirements apply to businesses that employ between 15 and 49 employees, and the FMLA covers employers who employ 50 or more employees, but there are scenarios where an employer is covered by both laws during the same year due to employee count changing. In those scenarios, this legislation clarifies that the required leave can run concurrently, which ensures that smaller businesses are not required to provide stacked leave when the number of their employees shifts in a given year.

SB 785 was heard in the Senate Finance Committee, passed out of the Senate, received a unanimous favorable report by the House Economic Matters Committee, and was signed into law by Governor Moore on May 6.

House Bill 1413 Labor and Employment – Employer Communications During Nonworking Hours – Right to Disconnect MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1413 (HB 1413) would have required all businesses, including small businesses, to establish a policy that provides employees with the right to “ignore” communications from employers outside of work hours.

While the bill sought to limit communications to benefit employees, it instead would have undermined the autonomy of employees who might prefer or need to communicate after hours for reasons ranging from personal convenience to urgent work-related matters that are not delineated as exceptions in the bill, such as scheduling changes that require timely communication with employees. This bill would have made it more difficult for employers to manage their workforce efficiently and effectively. The bill’s House Economic Matters hearing was ultimately canceled.

House Bill 1458/Senate Bill 809 Declaration of Rights – Right to Minimum Wage for Tipped Workers MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1458/Senate Bill 809 (HB 1458/ SB 809) sought to raise the minimum wage for tripped employees to the same rate as non-tipped employees. Implementing a flat minimum wage for tipped employees would result in untenable labor costs for businesses, fewer hours and lower earning potential for employees, and higher prices for consumers.

HB 1458’s hearing was canceled in the House Economic Matters Committee, and SB 809 was withdrawn by the sponsor.

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PAGE 33

Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment (cont.)

CHAMBER OPPOSED

House Bill 1548

FAILED

Employment – Harassment and Intimidation – Reporting MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

House Bill 1548 (HB 1548) would have established a new, broad standard of “harassment and intimidation” within the Maryland Occupational Safety and Health (MOSH) Act and require the Commissioner of Labor and Industry to create a standard “victim of harassment or intimidation reporting form” for employers and employees to report incidents of harassment or intimidation to the Maryland Department of Labor (the Department). The bill would have also authorized the Commissioner to establish an anonymous electronic tip program to report incidents.

HB 1548 could have labeled common workplace frustrations as serious misconduct, while also imposing administrative burdens on employers without a clear investigatory process. Additionally, assigning enforcement to the Department, rather than the Maryland Commission on Civil Rights, which has the appropriate expertise, would lead to duplicative, ineffective, and confusing reporting mechanisms.

HB 1548 was a late introduction and assigned to the House Rules and Executive Nominations Committee, and did not get assigned to its committee of jurisdiction.

Senate Bill 58 Labor and Employment – Parental School Engagement Leave Act MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

CHAMBER OPPOSED

FAILED

Senate Bill 58 (SB 58) would have required employers to provide additional paid leave to employees for parental engagement purposes of up to 12 hours each school year. Under current law, Maryland’s employers are already to provide sick and safe leave, jury and witness duty leave, and voting leave, in addition to leave regarding organ and bone marrow donation, volunteering, and parental bonding. In 2022, Maryland enacted the Time to Care Act, establishing the FAMLI program. SB 58 would have placed additional financial constraints and operational burdens on businesses.

SB 58 was heard in the Senate Finance Committee and was not brought up for a vote.

Senate Bill 494

CHAMBER OPPOSED

FAILED

Procurement Contracts and PublicPrivate Partnerships – Project Labor Agreements, Community Benefit Agreements, and Use of Registered Apprentices MD Chamber Position: Oppose MD Chamber Policy Committee: Labor & Employment Final Status: Failed

Senate Bill 494 (SB 494) sought to establish requirements related to project labor agreements, community benefit agreements, and the use of registered apprentices under procurement contracts and public-private partnerships. SB 494 could have restricted open competition that could raise costs, reduce participation from the broader business community, and introduce unnecessary regulatory complexity.

SB 494 was withdrawn by the Sponsor prior to a hearing being scheduled.

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Maryland Chamber of Commerce 2025 Legislative Report

Labor & Employment (cont.)

Senate Bill 355 Family and Medical Leave Insurance Program – Delay of Implementation MD Chamber Position: Support MD Chamber Policy Committee: Labor & Employment Final Status: Failed Senate Bill 355 (SB 355) would have delayed the dates by 24 months on which the payment of contributions and the submission of claims for benefits are to begin under the Paid Family and Medical leave Insurance (FAMLI ) program, providing the Maryland Department of Labor (the Department) with additional time to ensure that the program is adequately implemented.

While this bill did not advance, the Department’s bill — HB 102/SB 225 — did, delaying the FAMLI implementation dates from July 1, 2025, to January 1, 2027, for contributions to begin, and from January 1, 2026, to no later than January 3, 2028, for benefits to begin. Governor Moore signed the Department’s bill into law on May 6.

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PAGE 35

Maryland Chamber of Commerce 2025 Legislative Report

Taxation This policy committee evaluates all policies relating to business tax. They support tax policy reform that reduces the cost of doing business. It is our goal to strengthen the state’s competitive tax climate to help attract and retain businesses, talent and investment.

House Bill 23 Property Taxes - Authority of Counties to Establish a Subclass and Set a Special Rate for Commercial and Industrial Property MD Chamber Position: Oppose MD Chamber Policy Committee: Taxation Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 23 (HB 23) would have authorized counties to establish, by law, a subclass of real property consisting of certain commercial and industrial property and to set a special property tax rate for certain commercial and industrial property for the purpose of financing certain transportation improvements or the approved budget of the local county’s board of education. This legislation would have allowed counties to impose large tax hikes on certain properties, discouraging investment and slowing growth. With industrial property taxes already up 21.3% in five years, giving counties more tax power could worsen Maryland’s development challenges.

HB 23 passed out of the House, received a hearing in the Senate Budget and Taxation Committee, but did not advance out of committee.

House Bill 60/Senate Bill 99 Income Tax – Subtraction Modification for Military Retirement Income (Keep Our Heroes Home Act) MD Chamber Position: Support MD Chamber Policy Committee: Taxation Final Status: Failed House Bill 60/Senate Bill 99 (HB 60/SB 99) would have increased the Maryland income tax subtraction for certain military retirement income from $20,000 to $40,000 over two years.

Maryland should join the other 38 states that do not tax military retirement income. To be economically competitive with our neighboring states, we should increase the subtraction modification for military retirement income, ultimately keeping a highly skilled workforce in our state to help fill open jobs and recognizing the value of the contributions military retirees will make to Maryland’s future economic growth.

This legislation would have allowed the State of Maryland to not only reward military retirees for their sacrifices but allow them to continue their legacy of service at home in Maryland. By providing incentives for our military retirees to stay in Maryland, they will continue to provide sales tax revenue, volunteer, make charitable contributions and contribute to the state’s economy.

HB 60 and SB 99 were heard in their respective committees and did not receive a vote.

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PAGE 36

Maryland Chamber of Commerce 2025 Legislative Report

Taxation (cont.)

House Bill 342 State Transfer Tax – Rates and Distribution of Revenue MD Chamber Position: Oppose MD Chamber Policy Committee: Taxation Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 342 (HB 342) proposed an increase in Maryland’s state transfer tax rate on real property transactions, along with a modification of the distribution of revenue generated from the tax. It would have introduced a tiered transfer tax structure that raises the rate from .5% to as high as 1.5%, depending on the transaction value.

The proposed increase would have had a detrimental impact on Maryland’s business climate, in particular, commercial real estate and small business. Specifically, it would have increased transaction costs, discouraged investment in commercial real estate, and suppressed property activity, particularly in office spaces, warehouses, and retail centers.

This could have had adverse economic effects, reducing property sales and overall tax revenue, while increasing costs for businesses and residents alike. HB 342 may also raise constitutional concerns by conflicting with Maryland’s uniform taxation requirements. Rather than imposing this tax increase, the Maryland Chamber advocates for policies that stimulate economic growth and attract businesses to the state.

HB 342 was heard in the House Ways and Means Committee and did not receive a vote.

House Bill 352/Senate Bill 321 Budget Reconciliation and Financing Act of 2025 MD Chamber Position: Support with Amednment MD Chamber Policy Committee: Taxation Final Status: Approved by the Governor – Chapters 604 The Budget Reconciliation and Financing Act (BRFA) is an expansive piece of legislation and proposals contained with the bill as introduced, like lowering the corporate income tax rate, were necessary to remain competitive with our regional neighbors and jumpstart Maryland’s economy. The best way to fix our state’s budget circumstances is to invest in policies that provide long-term business investment and economic growth. However, we also had significant concerns with certain provisions in the BRFA, including mandating combined reporting, an increase in personal income taxes for those earning over $500,000 per year, impacting small businesses structured as pass-through entities, and the addition of a new 3% sales tax on data and IT services.

The Chamber was successful in defeating many concerning proposals in the bill as introduced, but the 3% “tech tax”, which passed, will impact over 15,000 employers and 99,000 jobs across the state – with many more being affected indirectly.

The Maryland Comptroller has proposed draft emergency regulations to address this new tax.

HB 352 was signed into law and goes into effect July 1, 2025.

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PAGE 37

Maryland Chamber of Commerce 2025 Legislative Report

Taxation (cont.)

House Bill 546/Senate Bill 605 Digital Advertising Gross Revenues Tax – Assessments – Appeals and Corrections MD Chamber Position: Support MD Chamber Policy Committee: Taxation Final Status: Approved by the Governor – Chapters 677 & 678

CHAMBER SUPPORTED

PASSED

House Bill 546/Senate Bill 605 (HB 536/SB 605) adds the Digital Advertising Gross Revenues Tax (DAGR tax) to the list of tax assessments eligible for an application for the revision of the assessment, a claim for refund, and an informal hearing within the Comptroller’s Office.

An issue discovered with the recently enacted DAGR tax, currently if a taxpayer files a claim for a DAGR tax refund or assessment revision and that claim is denied, a taxpayer’s only remedy is to appeal to the Maryland Tax Court. HB 546/SB 605 makes the DAGR tax eligible for an informal hearing within the Comptroller’s Office as a first step appeal, potentially saving both the state and taxpayer significant sums in legal fees by avoiding Tax Court. This change creates parity between the DAGR tax and other common taxes, providing a more accessible and cost-effective option for taxpayers to resolve disputes. The bill is prospective, affecting only DAGR tax assessments after December 31, 2025, while leaving current assessments and appeals unchanged.

Both bills passed out of their respective chambers and were signed into law on May 20.

House Bill 919 State Tax Credits, Exemptions, and Deductions – Alterations and Repeal MD Chamber Position: Oppose MD Chamber Policy Committee: Taxation Final Status: Failed

CHAMBER OPPOSED

FAILED

In addition to creating earlier sunsets for multiple tax credits, House Bill 919 (HB 919) would have created an earlier sunset for tax credits related to research and development. The research and development tax credit has consistently been utilized by companies specializing in life sciences and quantum computing, both target industries for economic growth in the state. By removing this important tool, HB 919 would have made Maryland less competitive with our neighboring states, as Pennsylvania and Virginia fund research and development tax credits at higher amounts than Maryland. HB 919 was heard in the House Ways and Means Committee and did not receive a vote.

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PAGE 38

Maryland Chamber of Commerce 2025 Legislative Report

Taxation (cont.)

House Bill 1014/Senate Bill 859 Fair Share for Maryland Act of 2025 MD Chamber Position: Oppose MD Chamber Policy Committee: Taxation Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 1014/Senate Bill 859 (HB 1014/SB 859) introduced several tax provisions that could negatively impact Maryland’s business climate, including the mandatory adoption of worldwide combined reporting, the implementation of the throwback rule, and a 2.5% tax increase on pass-through entities (PTEs).

This legislation would have, among other things, mandated that certain corporations compute their Maryland income tax using the worldwide combined reporting method – a highly complex system of determining taxable income among all countries in which a company does business. HB 1014/SB 859 would have also mandated adoption of the throwback rule where sales that are not taxed in the destination state are “thrown back” into the state where the sale originated, despite the income not being earned there. Additionally, this legislation would have imposed a potential additional 2.75% tax on Maryland pass-through entities (PTEs), our state’s smallest businesses. This change would force Maryland PTEs to pay income at the corporate rate instead of the current personal rate. Among other changes in the legislation, it would have increased Maryland’s personal tax rate for those making more than $250,000.

HB 1014 and SB 859 were heard in their respective committees and did not receive votes.

House Bill 1101/Senate Bill 836 Corporate Income Tax – Rate Reduction (Economic Competitiveness Act of 2025) MD Chamber Position: Support MD Chamber Policy Committee: Taxation Final Status: Failed This bill would have decreased, over 5 taxable years, the State corporate income tax rate from 8.25% to 6.25%.

House Bill 1101/Senate Bill 836 (HB 1101/SB 836) would have put the state in far greater footing in terms of business climate and national economic competitiveness. It is well documented, most notably by the Augustine Commission, that Maryland’s corporate income tax rate stifles the state’s business climate. The Commission concluded that a reduction in the rate would allow businesses to establish new or expand existing operations, while preventing the continued outmigration of businesses and workers to more competitive states. The language of this bill is identical to that proposed by the Commission.

Both HB 1282 and SB 923 were heard in their respective committees and did not receive a vote.

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PAGE 39

Maryland Chamber of Commerce 2025 Legislative Report

Taxation (cont.)

CHAMBER OPPOSED

FAILED

House Bill 1554/Senate Bill 1045 Sales and Use Tax – Taxable Business Services – Alterations MD Chamber Position: Oppose MD Chamber Policy Committee: Taxation Final Status: Failed House Bill 1554/Senate Bill 1045 (HB 1554/SB 1045) proposed a new 2.5% sales tax on a wide range of business-tobusiness services, such as accounting, consulting, and employee placement, which would have had over a $1 billion economic impact.

The Maryland Chamber of Commerce and many other business groups strongly opposed this bill, as it would have disproportionately affected small businesses that rely heavily on outsourced services, raising their operational costs and potentially forcing them to cut jobs or reduce investments. The tax would have also created a cascading effect, leading to higher consumer prices and increased administrative burdens for businesses, particularly small ones that lack the resources to manage the new compliance requirements. Moreover, Maryland would become an outlier among neighboring states like Virginia and Delaware, creating a competitive disadvantage and encouraging businesses to seek services across state lines or relocate.

This legislation set a dangerous precedent for future tax expansions. A tax on services is discriminatory against small and fledgling businesses, leading to additional operating costs and tax pyramiding, placing Maryland businesses at a competitive disadvantage. Instead of discouraging investment, Maryland should focus on policies that foster business growth and long-term economic development.

Both bills were heard in their respective committees and did not receive a vote.

Senate Bill 33 Office of the Comptroller and Department of Legislative Services – Maryland Business Taxes – Study MD Chamber Position: Support with Amendment MD Chamber Policy Committee: Taxation Final Status: Failed Senate Bill 33 (SB 33) would have required the Comptroller’s Office and the Department of Legislative Services to study and make recommendations regarding the state’s business tax structure and the imposition of combined reporting. The study would have been due by December 15, 2026.

While the Chamber does not support combined reporting, we were supportive of this study as it would have shown, just like we’ve seen in past studies, that combined reporting would create an undue burden on businesses, is a volatile revenue source, and would further harm the state’s economic competitiveness.

SB 33 was withdrawn by the sponsor prior to receiving a hearing.

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PAGE 40

Maryland Chamber of Commerce 2025 Legislative Report

Taxation (cont.)

Senate Bill 1041 Property Tax – Charter Counties – Application of County Tax Limitation on Public Safety Budget MD Chamber Position: Oppose MD Chamber Policy Committee: Taxation Final Status: Failed

CHAMBER OPPOSED

FAILED

Senate Bill 1041 (SB 1041) sought to authorize a county council of a charter county to set by simple majority vote a property tax rate that is higher than the property tax rate authorized under a county’s charter or collect more property tax revenues than the revenues authorized under the county’s charter for the purpose of funding the county’s approved public safety budget. The tax would have applied to all taxable years after June 30, 2025.

This bill was a late introduction and did not make it out of the Senate Rules Committee.

Session 2025 Tax Threats Fair Opportunity Maryland: Our Fight Against Tax Overreach

The Challenge: Multiple devastating tax proposals threatened Maryland businesses — 2.5% business-to-business services tax, combined reporting requirements, pass-through entity tax increases and a 3% tax on data and IT services.

What We Did: • 100,000+ advocacy emails sent to legislators • 3,700+ direct calls connecting business owners to representatives • 400+ businesses providing testimony on critical issues • 35+ media stories highlighting business concerns • 2.5+ million social media impressions amplifying our message The Result: We defeated numerous harmful tax proposals that would have driven businesses out of Maryland. These numbers represent a business community that refuses to accept the status quo.

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Maryland Chamber of Commerce 2025 Legislative Report

Transportation & Infrastructure This policy committee supports improved state infrastructure that boosts economic opportunity. They work to advance short- and long-term answers to statewide transportation and transit needs.

House Bill 80/Senate Bill 190 Land Use – Transit-Oriented Development – Alterations MD Chamber Position: Support MD Chamber Policy Committee: Transportation Final Status: Failed House Bill 80/Senate Bill 190 (HB 80/SB 190) aimed to streamline transit-oriented development (TOD) in Maryland by addressing zoning, funding, and implementation barriers that hinder the full use of transit assets. The legislation encouraged mixed-use development near rail transit stations, while reducing costs for developers and attracting private investment by simplifying procurement laws and enabling the pooling of special taxing district funds.

Additionally, as introduced, it eliminated minimum off-street parking requirements for developments within 0.5 miles of rail stations, reducing obstacles for businesses and developers in high-demand areas. This approach promotes economic growth, talent retention, and workforce mobility while addressing housing costs and fostering vibrant, accessible communities. The bill was later amended to restrict local jurisdictions from imposing a minimum off-street parking requirement within .25 miles of a rail transit station that receives at least hourly service from 8:00 a.m.-6:00 p.m. Monday through Friday.

HB 80 passed out of its chamber, but did not advance beyond the Senate Budget and Taxation Committee.

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Maryland Chamber of Commerce 2025 Legislative Report

Transportation & Infrastructure (cont.)

House Bill 84/Senate Bill 395 Transportation – Major Highway Capacity Expansion Projects and Impact Assessments (Transportation and Climate Alignment Act of 2025) MD Chamber Position: Oppose MD Chamber Policy Committee: Transportation Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 84/Senate Bill 395 (HB 84/SB 395) would have required the Department of Transportation to establish a process for performing major highway capacity expansion project impact assessments and develop and implement a corresponding multimodal transportation program to identify investments in transit and pedestrian and bicycle facilities to offset an increase in greenhouse gas emissions associated with a highway expansion project.

Imposing the mandates outlined in HB 836/SB 681 could bring highway capacity expansion to a halt, effectively eliminating many expansion projects. Highway congestion would impose significant costs on businesses due to increased transportation time and delays in the delivery of goods and services. These delays could have disrupted supply chains, leading to increased operational costs and decreased efficiency. Maryland ranks in the bottom third nationally for per capita transportation infrastructure investment. As Maryland continues to grapple with persistent transportation infrastructure challenges that impact commute times and business operations, this legislation would have further negatively impacted our highway system.

HB 84 was reported Favorable with Amendments by the House Appropriations Committee but did not make it out of the Senate Budget and Taxation Committee.

House Bill 400/Senate Bill 55 State Finance – Prohibited Appropriations – Magnetic Levitation Transportation System MD Chamber Position: Oppose MD Chamber Policy Committee: Transportation Final Status: Failed

CHAMBER OPPOSED

FAILED

This bill would have prohibited the state and certain units and instrumentalities of the state from using any appropriation for a magnetic levitation (maglev) transportation system in Maryland.

This legislation would have created significant barriers for public and private investment in the construction of a maglev transportation system connecting Washington, D.C., and Baltimore. The legislation would have essentially rendered any maglev project impossible to construct and set a dangerous precedent for lawmakers to ban the use of funding for one project versus another. Mass transportation projects, such as maglev, create jobs, generate economic activity and transform Maryland into a leader in 21st-century transportation solutions.

Both bills were heard in their respective committees, and neither received a vote.

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Maryland Chamber of Commerce 2025 Legislative Report

Transportation & Infrastructure (cont.)

House Bill 846 Transportation Access and Revenue Act MD Chamber Position: Oppose MD Chamber Policy Committee: Transportation Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 846 (HB 846) proposes expanding Maryland’s 6% sales and use tax to include certain transportation-related services, including transportation equipment manufacturing, air transportation, motor vehicle towing, courier and messenger services, automative repair and maintenance, and more. The revenue would be directed to the Transportation Trust Fund (TTF). However, it prohibited funds from being allocated to the Gasoline and Motor Vehicle Revenue Account in the TTF, which is primarily used for funding crucial road and highway projects. HB 846 not only expanded the tax base but set a troubling precedent by directing what type of transportation projects the revenue can and cannot be used for.

The TTF supports critical infrastructure projects across the state, including roads, bridges, and maintenance of our transportation system. Most taxpayers are road users who rely on well-maintained infrastructure. Forcing residents and businesses that depend on vehicles to pay this tax, yet excluding their ability to benefit from road improvements, is not only unfair but counterproductive. Additionally, the legislation would have increased the cost of maintaining fleets, driving up operational expenses, auto insurance premiums, and ultimately consumer prices.

HB 846 was heard in the House Ways and Means Committee and did not receive a vote.

House Bill 958/Senate Bill 855 Railroads – Safety Requirements (Maryland Railway Safety Act of 2025) MD Chamber Position: Oppose MD Chamber Policy Committee: Transportation Final Status: Failed

CHAMBER OPPOSED

FAILED

House Bill 958/Senate Bill 855 (HB 958/SB 855) proposed imposing burdensome new requirements on Maryland’s freight railroads, expanding state regulatory oversight and creating additional costs for the industry. The bill mandates restrictions on train length, requires a minimum of two crew members at all times, and introduces new reporting and inspection requirements that duplicate federal oversight, adding unnecessary complexity.

The freight rail industry is crucial to Maryland’s economy, supporting thousands of direct and indirect jobs and minimizing transportation costs. Significant investments, including over $2 billion in the Port and the Howard Street Tunnel project, rely on the ability to operate longer trains for transporting goods. The bill risked reversing progress made in rail service and infrastructure and disregarded the historical lessons learned from heavy regulations that harmed the railroad industry in the past. With freight rail demand projected to increase by 45% by 2040, it is essential for Maryland to support legislation that facilitates, rather than hinders, the efficient movement of goods to maintain its competitive edge.

Both bills were heard in their respective committees and did not receive a vote.

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PAGE 44

Maryland Chamber of Commerce 2025 Legislative Report

Transportation & Infrastructure (cont.)

House Bill 1556 Environment – Advanced Clean Cars II Program and Advanced Clean Trucks Regulation – Application and Enforcement MD Chamber Position: Support MD Chamber Policy Committee: Transportation Final Status: Failed House Bill 1556 (HB 1556) sought to prevent the Maryland Department of the Environment from enforcing penalties for non-compliance with the California Advanced Clean Cars II Program and Advanced Clean Trucks regulation for model years 2027 and 2028. The bill offered regulatory certainty for businesses, acknowledging the challenges posed by the aggressive timeline in California’s emissions regulations.

While the regulations are set to take effect beginning with model year 2027, neither the industry nor the state is fully prepared to meet the requirements due to ongoing challenges such as insufficient electric vehicle infrastructure, limited federal incentives, and lagging consumer demand.

HB 1556 passed out of the House Environment and Transportation Committee and reached third reading on the House floor, but did not advance onto the Senate. Instead, Governor Moore issued an Executive Order on April 4 reflecting key aspects of this legislation — delaying the enforcement of penalties on EV manufacturers for model years 2027-2028.

Senate Bill 1020 Environment – Advanced Clean Cars II Program – Application and Enforcement MD Chamber Position: Support MD Chamber Policy Committee: Transportation Final Status: Failed Senate Bill 1020 (SB 1020) would have prohibited the Maryland Department of the Environment (the Department) from adopting the California Advanced Clean Cars II regulations to be effective before motor vehicle model year 2031. It would have also prohibited the Department from applying the enforcement or penalty provisions of the regulations to a vehicle manufacturer for failing to meet the requirements.

SB 1020 was a late introduction and did not make it out of the Senate Rules Committee.

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PAGE 45

Maryland Chamber of Commerce 2025 Legislative Report

Workers’ Compensation & Unemployment Insurance This committee covers workers’ compensation and unemployment insurance issues impacting employers and supports policies that promote a fair and equitable balance between employee and employer concerns.

House Bill 193/Senate Bill 219 Uninsured Employers’ Fund – Assessments and Special Monitor MD Chamber Position: Oppose MD Chamber Policy Committee: Workers’ Compensation & Unemployment Insurance Final Status: Vetoed by the Governor

CHAMBER OPPOSED

VETOED

House Bill 193/Senate Bill 219 (HB 193/SB 219) would have increased the additional percentage the Uninsured Employers’ Fund (UEF) may direct the Workers’ Compensation Commission to assess on awards and settlements if the UEF determines that the reserves of the Fund are inadequate to meet anticipated losses.

Maryland’s compliant employers – those who dutifully maintain workers’ compensation insurance – already contribute significantly to funding both the Subsequent Injury Fund and the UEF through assessments on awards and settlements.

These employers should not be further penalized to compensate for the financial challenges facing the UEF, particularly in the absence of a clear long-term funding strategy. Rather than shifting the financial burden onto businesses that are already meeting their legal obligations, the Maryland Chamber urged the legislature to explore alternative solutions that improve the fiscal responsibility of the UEF while protecting Maryland’s job creators from undue costs.

HB 193 and SB 219 passed their respective Chambers, however Governor Moore vetoed the legislation on May 16, citing Maryland’s current budget constraints and stating that the proposed studies would impose unnecessary financial burdens without delivering immediate benefits.

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Maryland Chamber of Commerce 2025 Legislative Report

Workers’ Compensation & Unemployment Insurance (cont.)

House Bill 554/Senate Bill 752 Unemployment Insurance Modernization Act of 2025 MD Chamber Position: Oppose MD Chamber Policy Committee: Workers’ Compensation & Unemployment Insurance Final Status: Failed

CHAMBER OPPOSED

FAILED

This legislation aimed to make four primary changes to Maryland’s unemployment insurance program. It would have repealed and replaced the methodology used to calculate the weekly benefit amount by raising the minimum and maximum weekly benefit amounts to 15% and 50% of the state average weekly wage, respectively. It would have also altered the taxable wage base used to determine employer contributions to the Unemployment Insurance Trust Fund by tying it to 20% of the state average annual wage instead of using the current $8,500 wage base. The bill also would have increased the dependent allowance from $8 to $25 per dependent and indexed it to inflation, along with indexing the $50 earnings deduction.

This legislation would have made significant changes to the state’s unemployment insurance program that could have imposed substantial costs on Maryland’s employers. To put some of the proposals in context, the required increase in employer contributions would have increased the unemployment insurance tax burden on businesses about 76%, nearly doubled the state’s maximum weekly benefit amount, and increased the minimum weekly benefit amount by approximately five times the current minimum. Further, the taxable wage base and benefit amounts would be tied to a percentage of the state’s average weekly or annual wages, which tend to increase over time. Attaching the dependent allowance and earnings deduction to inflation is also concerning, particularly as inflation remains stubbornly above the Federal Reserve’s target rate of 2%.

Both bills were heard in their committees of jurisdiction and did not receive a vote.

Senate Bill 306 Workers’ Compensation – Prescription Drug and Pharmaceutical Services – Reimbursements MD Chamber Position: Support MD Chamber Policy Committee: Workers’ Compensation & Unemployment Insurance Final Status: Failed Senate Bill 306 (SB 306) sought to establish a medical fee guide for prescription drug reimbursements under Maryland’s workers’ compensation system. While medical services in workers’ compensation claims are already subject to a regulated fee schedule, currently, there is no standardized fee guide for prescription medications, leading to cost disparities and inefficiencies.

Prescription drugs are often reimbursed based on the Average Wholesale Price (AWP), which inflates costs beyond actual acquisition prices, placing financial burdens on employers and causing costly litigation to dispute excessive charges. SB 306 intended to create a fair and predictable reimbursement structure based on acquisition costs, reducing claims costs while ensuring injured workers still have access to necessary medications.

SB 306 passed the Senate but failed to advance in the House after its hearing in the House Economic Matters Committee.

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Maryland Chamber of Commerce 2025 Legislative Report

Workers’ Compensation & Unemployment Insurance (cont.)

Senate Bill 830 Workers’ Compensation – Claims Application Form – Authorization for Release of Information MD Chamber Position: Support MD Chamber Policy Committee: Workers’ Compensation & Unemployment Insurance Final Status: Approved by the Governor – Chapter 308

CHAMBER SUPPORTED

PASSED

This bill adds to the entities authorized to receive workers’ compensation claim information to include the Uninsured Employers’ Fund and the Subsequent Injury Fund. It also broadens the required release of information to include additional claims filed by the claimant and records maintained by the Workers’ Compensation Commission (WCC).

WCC recently implemented a new paperless claims system, which inadvertently restricted employer and insurer access to claim history information – information that has always been a key factor in the fair and efficient resolution of claims.

SB 830 corrects this oversight by streamlining access to relevant claims data, eliminating the need for employers and insurers to issue subpoenas to the WCC. SB 830 was heard in the Senate Finance Committee and was signed into law on May 6.

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Maryland Chamber of Commerce 2025 Legislative Report

Governor Moore’s Legislative Priorities That We Supported Governor Moore introduced nine bills as part of his legislative package. Of the bills introduced, the Maryland Chamber supported the following:

House Bill 500/Senate Bill 426 Procurement Reform Act of 2025 MD Chamber Position: Support with Amendment MD Chamber Policy Committee: Business Regulations & Operations Final Status: Approved by the Governor – Chapter 601

CHAMBER SUPPORTED

PASSED

House Bill 500/Senate Bill 426 (HB 500/SB 426) seeks to modernize the state’s procurement processes to enhance efficiency, accountability, competition, and small business access to state contracts. Specifically, the legislation expands the authority of the Chief Procurement Officer and delegates procurement powers for transportation-related goods and services to the Maryland Department of Transportation. It raises the Small Business Reserve threshold from $500,000 to $1 million, requires workforce and supplier diversity plans for certain contracts, and mandates the use of apprentices or interns on high-value contracts. The bill also creates a Good Labor Practices certification that provides a minimum 5% price preference for a state contract to companies meeting certain employment standards, such as all persons performing the work are W-2 employees, employees are not paid in cash, employers accept joint and several liability for violations by subcontractors of the Labor codes, and more.

The Chamber applauds the overall intent of this legislation, as procurement is a key lever for economic development.

We worked with the Governor’s Office to address a few targeted amendments based on the bill as introduced aimed at further strengthening the procurement process and providing greater certainty for Maryland businesses, including addressing certain provisions surrounding timing for participation goals and post execution amendments, penalties, and Good Labor Standards.

HB 500 passed out of the House and Senate with amendments and was signed into law by Governor Moore on May 20.

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Maryland Chamber of Commerce 2025 Legislative Report

Governor Moore’s Legislative Priorities That We Supported (cont.)

House Bill 499/Senate Bill 432 Criminal Records – Expungement and Maryland Judiciary Case Search (Expungement Reform Act of 2025) MD Chamber Position: Support MD Chamber Policy Committee: Education & Workforce Development Final Status: Approved by the Governor – Chapter 95

CHAMBER SUPPORTED

PASSED

House Bill 499/Senate Bill 432 (HB 499/SB 432) expands expungement eligibility in Maryland by shortening waiting periods and broadening eligibility for individuals with criminal records. It allows petitions for expungement to be filed after the completion of a sentence, including probation or parole, rather than after a fixed waiting period. The bill expands eligibility to include misdemeanor convictions, such as credit card theft and driving without a license. Additionally, it prohibits the Maryland Judiciary Case Search from displaying records of cannabis possession charges that have been pardoned by the Governor.

By making expungement more accessible, HB 499/SB 432 will reduce barriers to employment for individuals with certain criminal records, supporting their reintegration into the workforce. The Maryland Chamber of Commerce supports the expansion of career and education opportunities for justice-impacted individuals as a way to promote second-chance employment and help strengthen our workforce and communities. SB 432 was heard in the Senate Judicial Proceedings Committee, passed both chambers, and was signed into law on April 22.

House Bill 503/Senate Bill 430 Housing Development Act MD Chamber Position: Support MD Chamber Policy Committee: Education & Workforce Development Final Status: Failed As introduced, House Bill 503/Senate Bill 430 (HB 503/SB 430) sought to address Maryland’s housing shortage by requiring state agencies to identify regional housing gaps and apportion them to local jurisdictions based on job concentration. The bill also incentivized the construction of affordable housing by allowing these projects to count more significantly toward closing local housing gaps. Additionally, it established a legal framework to challenge improper denials, ensuring that housing supply keeps pace with economic growth and workforce needs.

Maryland’s housing shortage presents a significant barrier to economic growth, workforce attraction, and business expansion. With only 33 available workers for every 100 job openings, businesses across the state struggle to fill positions. This legislation would have provided a strategic framework to help close these gaps by encouraging local jurisdictions to prioritize housing development in areas of greatest need while maintaining reasonable safeguards for community and infrastructure considerations.

SB 430 was heard in the Senate Education, Energy and the Environment Committee but did not advance out of committee. HB 503 passed out of the House with amendments but failed to advance in the Senate.

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Maryland Chamber of Commerce 2025 Legislative Report

Governor Moore’s Legislative Priorities That We Supported (cont.)

House Bill 501/Senate Bill 431 Registered Apprenticeship Investments for a Stronger Economy (RAISE) Act MD Chamber Position: Support MD Chamber Policy Committee: Education & Workforce Development Final Status: Approved by the Governor – Chapter 2

CHAMBER SUPPORTED

PASSED

House Bill 501/Senate Bill 431 (HB 501/SB 431) modernizes Maryland’s apprenticeship system by expanding the definition of a qualifying apprenticeship, ensuring more Marylanders can access career training programs that align with industry needs. Specifically, this legislation creates opportunities to increase the allowable apprentice-to-journeyperson ratio on non-hazardous occupations beyond 1:1. This change enhances small business participation, promotes economic mobility, and creates more opportunities for Maryland workers.

The bill also introduces the Maryland Pay Per Apprenticeship Program to provide financial incentives to employers and apprenticeship sponsors to offset costs associated with hiring and training newly registered apprentices – making apprenticeships a more viable and scalable solutions for closing Maryland’s workforce gaps. Expanding access to apprenticeships is a priority for the Chamber and broader business community, and this legislation takes an important step in addressing the state’s workforce needs.

SB 431 was signed into law by Governor Moore on April 8.

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CONCLUSION THE FIGHT CONTINUES The 2025 session showed we can win important battles when businesses stand together. Our advocacy machine proved it can defeat harmful proposals and protect Maryland’s economic interests. But we can’t mistake tactical victories for prolonged success.

Your voice is essential to the continued fight. Every business owner who testifies about regulatory burdens. Every entrepreneur who explains how taxes affect hiring decisions. Every CEO who shares why companies are choosing other states. Every chamber member who contacts their legislator — these voices are collectively changing the conversation in Annapolis.

But we need more. We need your stories. We need your advocacy. We need your support for the long fight ahead.

The main street shops, the restaurants, the service companies, the manufacturers, the mom-and-pops — they’re all counting on us to create a Maryland where business can thrive, not just survive.

We must win the war for Maryland’s economic future. That fight continues in 2026, and we can’t do it without you.

Sincerely, Mary D. Kane President & CEO

WHAT THESE VICTORIES REALLY MEAN Make no mistake: the wins we achieved in 2025 were critical, but they were defensive victories in what remains a challenging business environment. We successfully defeated the catastrophic 2.5% businessto-business services tax that would have devastated professional service firms, small businesses, and their clients. We stopped combined reporting schemes that would have made Maryland even less competitive.

But let’s be clear about what we’re still up against. While we stopped the worst proposals, Maryland businesses will continue to face: • • • •

Some of the highest tax rates in the region A regulatory environment that too often treats businesses as problems to be managed rather than partners in prosperity A growing structural budget deficit that makes future tax increases nearly inevitable A competitiveness gap that’s driving businesses and jobs to neighboring states

Every victory matters, but each one is a step in a much longer journey.

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Maryland Chamber of Commerce 2025 Legislative Report

Policy Committees OVERVIEW The Maryland Chamber of Commerce’s subject matter committees bring expertise and experience to the Chamber’s advocacy efforts. These committees help guide the Chamber’s agenda for policy areas including health care, civil liability and business law.

During Maryland’s legislative session, our government affairs team reviews recently introduced bills and resolutions and identifies specific pieces of legislation of particular interest to our members. Our team then compiles these bills and distributes them to the relevant policy committee chair(s) to review and approve for consideration. The list of bills for consideration is then sent to the full committee for review before the committee’s scheduled conference call.

During this conference call, members weigh each issue and decide which position the Chamber should take, if any, and make recommendations to the larger Chamber’s Legislative Committee. The Chamber’s Legislative Committee will ultimately vote on and approve each of the Chamber’s positions. Chamber positions can include: Support, Support with Amendment, Letter of Information, Oppose, Hold/Monitor.

For more information or to join a committee, please visit mdchamber.org or email Senior Director of Government Affairs Hannah Allen at hallen@mdchamber.org, for more information.

LEGISLATIVE COMMITTEE By invitation only This committee develops the Chamber’s position on legislation affecting the business community.

BUSINESS REGULATION & OPERATIONS COMMITTEE This committee was first introduced for the 2018 session, and addresses legislative and regulatory issues affecting daily operational activities of businesses.

CIVIL LIABILITY COMMITTEE This committee covers all issues related to tort reform and civil liability of businesses, including opposing efforts to expand exposure to liability and damages (including punitive and non-economic damages) and weaken defenses available to businesses.

CYBER & TECHNOLOGY COMMITTEE This committee covers issues related to growing and retaining biotechnology, cybersecurity, and other high-tech business innovators, including a focus on industry infrastructure needs.

EDUCATION & WORKFORCE DEVELOPMENT COMMITTEE This committee covers issues addressing education and workforce development and the need for Maryland’s students to have affordable access to quality educational and skills-training systems that prepare them for college or a career, as well as the need for Maryland’s trades and businesses to hire and retain qualified workers.

ENERGY & ENVIRONMENT COMMITTEE This committee covers all energy and environmental issues impacting Maryland’s business community. Areas include energy diversity and reliability, climate and greenhouse gas emission policies, stormwater and waste management, pollution control, chemical regulation and land use.

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Maryland Chamber of Commerce 2025 Legislative Report

Policy Committees (cont.)

HEALTH CARE & BIOPHARMA COMMITTEE This committee covers all healthcare issues, including cost factors, mandated health benefit demands, and regulatory oversights and requirements relative to improving Maryland’s current marketbased health care system to control costs and improve affordable access to coverage. Additionally, this committee will address issues regarding legislative interaction in the pharmacological discovery and development processes and related areas.

TAXATION COMMITTEE This committee covers all taxation issues impacting Maryland’s tax climate with the goal of strengthening that climate to help attract and retain businesses, workers, and investment.

TRANSPORTATION COMMITTEE This committee covers all transportation issues, coordinating a broad-based coalition of businesses, trade groups, and associations to advance short- and longterm solutions to statewide transportation and transit needs.

LABOR & EMPLOYMENT COMMITTEE This committee covers all Maryland employment law and workplace regulation issues including mandatory paid leave, paid sick leave insurance, pre-emption of local laws on labor issues, public accommodation laws, noncompete agreements, minimum wage, predictive and restrictive scheduling and more.

WORKERS’ COMPENSATION & UNEMPLOYMENT INSURANCE COMMITTEE This committee covers all workers’ compensation and unemployment insurance issues impacting businesses.

YOUR VOICE MATTERS Lend your voice to shape the future of Maryland’s economy. As an advocate with the Maryland Chamber of Commerce, you join a 7,000+ member-strong grassroots collective of business thought leaders and a fulltime, dedicated government affairs team with strong relationships in Annapolis and on Capitol Hill.

Through our 10 policy committees, you can have an active role in influencing the public policy that affects your business — with a partner that protects your interests. For more information about membership, contact Executive Vice President Whitney Harmel at wharmel@mdchamber.org or 410-269-0642 x1117.

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