Maryland 2022 Regular Session

Maryland House Bill HB542 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1		-	LAWRENCE J. HOGAN, JR., Governor Ch. 641
2	1
3		-	– 1 –
4		-	Chapter 641
5		-	(House Bill 542)
6	2
7		-	AN ACT concerning
	3	+	EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
	4	+	[Brackets] indicate matter deleted from existing law.
	5	+	Underlining indicates amendments to bill.
	6	+	Strike out indicates matter stricken from the bill by amendment or deleted from the law by
	7	+	amendment.
	8	+	hb0542
8	9
9		-	State Retirement and Pension System – Investment Committee – Use of
10		-	Minority and Women–Owned Business Enterprises
11		-	(Diversity Among Asset Managers Act of 2022)
	10	+	HOUSE BILL 542
	11	+	P6 2lr1038
	12	+	CF SB 954
	13	+	By: Delegate J. Lewis
	14	+	Introduced and read first time: January 21, 2022
	15	+	Assigned to: Appropriations
	16	+	Committee Report: Favorable with amendments
	17	+	House action: Adopted
	18	+	Read second time: March 3, 2022
12	19
13		-	FOR the purpose of requiring the Investment Committee of the State Retirement Agency
14		-	to use minority business enterprises to provide a certain percentage of brokerage and
15		-	investment management services to the Board of Trustees for the State Retirement
16		-	and Pension System and to manage a certain percentage of system assets; requiring
17		-	the Investment Committee of the State Retirement Agency to assess the use of
18		-	minority business enterprises beginning on a certain date; requiring a certain
19		-	certification agency and the Governor’s Office of Small, Minority, and Women
20		-	Business Affairs, in consultation with certain entities, to study the brokerage and
21		-	investment services used by the State Retirement and Pension System to evaluate
22		-	whether remedial measures to assist minority and women–owned businesses would
23		-	comply with a certain court opinion and any subsequent federal or constitutional
24		-	requirements; and generally relating to the use of minority and women–owned
25		-	business enterprises in the State Retirement and Pension System.
	20	+	CHAPTER ______
26	21
27		-	BY repealing and reenacting, without amendments,
28		-	Article – State Personnel and Pensions
29		-	Section 21–116(a)
30		-	Annotated Code of Maryland
31		-	(2015 Replacement Volume and 2021 Supplement)
	22	+	AN ACT concerning 1
32	23
33		-	BY repealing and reenacting, with amendments,
34		-	Article – State Personnel and Pensions
35		-	Section 21–116(d)
36		-	Annotated Code of Maryland
37		-	(2015 Replacement Volume and 2021 Supplement)
	24	+	State Retirement and Pension System – Investment Committee – Use of 2
	25	+	Minority and Women–Owned Business Enterprises 3
	26	+	(Diversity Among Asset Managers Act of 2022) 4
38	27
39		-	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
40		-	That the Laws of Maryland read as follows:
	28	+	FOR the purpose of requiring the Investment Committee of the State Retirement Agency 5
	29	+	to use minority business enterprises to provide a certain percentage of brokerage and 6
	30	+	investment management services to the Board of Trustees for the State Retirement 7
	31	+	and Pension System and to manage a certain percentage of system assets; requiring 8
	32	+	the Investment Committee of the State Retirement Agency to assess the use of 9
	33	+	minority business enterprises beginning on a certain date; requiring a certain 10
	34	+	certification agency and the Governor’s Office of Small, Minority, and Women 11
	35	+	Business Affairs, in consultation with certain entities, to study the brokerage and 12
	36	+	investment services used by the State Retirement and Pension System to evaluate 13
	37	+	whether remedial measures to assist minority and women–owned businesses would 14
	38	+	comply with a certain court opinion and any subsequent federal or constitutional 15
	39	+	requirements; and generally relating to the use of minority and women–owned 16
	40	+	business enterprises in the State Retirement and Pension System. 17
41	41
42		-	Article – State Personnel and Pensions
	42	+	BY repealing and reenacting, without amendments, 18
	43	+	Article – State Personnel and Pensions 19
	44	+	Section 21–116(a) 20
	45	+	Annotated Code of Maryland 21
	46	+	(2015 Replacement Volume and 2021 Supplement) 22
43	47
44		-	~~21–116.~~
	48	+	BY repealing and reenacting, with amendments, 23 2 HOUSE BILL 542
45	49
46		-	(a) By resolution, the Board of Trustees shall specify the powers of the Investment
47		-	Committee.
48		-	Ch. 641 2022 LAWS OF MARYLAND
49	50
50		-	– 2 –
51		-	(d) (1) (i) Consistent with minority business purchasing standards
52		-	applicable to units of State government under the State Finance and Procurement Article
53		-	and consistent with the fiduciary duties of the Board of Trustees, the Board of Trustees
54		-	shall direct the Investment Committee to [attempt to] use [to the greatest extent feasible]
55		-	minority business enterprises to provide brokerage and investment management services
56		-	to the Board IN ACCORDANCE WITH S UBPARAGRAPH (II) OF THIS PARAGRAPH .
	51	+	Article – State Personnel and Pensions 1
	52	+	Section 21–116(d) 2
	53	+	Annotated Code of Maryland 3
	54	+	(2015 Replacement Volume and 2021 Supplement) 4
57	55
58		-	~~(ii)~~ THE ~~USE~~ OF ~~MINORITY B USINESS ENTERPRISES UNDER~~
59		-	~~SUBPARAGRAPH (I)~~ OF ~~THIS PARAGRAPH SH ALL CONSIST OF~~:
	56	+	SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 5
	57	+	That the Laws of Maryland read as follows: 6
60	58
61		-	1. AT LEAST 20% OF BROKERAGE AND INV ESTMENT
62		-	MANAGEMENT SERVICES TO THE BOARD; AND
	59	+	Article – State Personnel and Pensions 7
63	60
64		-	2. MANAGEMENT OF AT LEA ST 20% OF THE ASSETS OF
65		-	THE SEVERAL SYSTEMS .
	61	+	21–116. 8
66	62
67		-	(III) (II) FOR THE FISCAL YEAR B EGINNING JULY 1, 2022, AND
68		-	EACH FISCAL YEAR THE REAFTER, THE BOARD OF TRUSTEES SHALL ASSESS THE USE
69		-	OF MINORITY BUSINESS ENTERPRISES AS REQUI RED UNDER THIS SUBSE CTION.
	63	+	(a) By resolution, the Board of Trustees shall specify the powers of the Investment 9
	64	+	Committee. 10
70	65
71		-	(IV) (III) For purposes of this subsection, brokerage and investment
72		-	management services shall include services relating to all allocated asset classes.
	66	+	(d) (1) (i) Consistent with minority business purchasing standards 11
	67	+	applicable to units of State government under the State Finance and Procurement Article 12
	68	+	and consistent with the fiduciary duties of the Board of Trustees, the Board of Trustees 13
	69	+	shall direct the Investment Committee to [attempt to] use [to the greatest extent feasible] 14
	70	+	minority business enterprises to provide brokerage and investment management services 15
	71	+	to the Board IN ACCORDANCE WITH S UBPARAGRAPH (II) OF THIS PARAGRAPH . 16
73	72
74		-	(2) (i) To assist it in achieving the [goal] GOALS described under
75		-	paragraph (1) of this subsection, the Investment Committee shall undertake measures to
76		-	remove any barriers that limit full participation by minority business enterprises in
77		-	brokerage and investment management services opportunities afforded under this title.
	73	+	(ii) THE USE OF MINORITY B USINESS ENTERPRISES UNDER 17
	74	+	SUBPARAGRAPH (I) OF THIS PARAGRAPH SH ALL CONSIST OF: 18
78	75
79		-	(ii) The measures undertaken by the Investment Committee shall
80		-	include the use of a wide variety of media, including the State Retirement Agency’s website,
81		-	to provide notice to a broad and varied range of potential providers about the brokerage
82		-	and investment management services opportunities afforded by the State Retirement
83		-	Agency.
	76	+	1. AT LEAST 20% OF BROKERAGE AND INV ESTMENT 19
	77	+	MANAGEMENT SERVICES TO THE BOARD; AND 20
84	78
85		-	(3) In consultation with the Governor’s Office of Small, Minority, and
86		-	Women Business Affairs and the Investment Committee, the Board of Trustees shall
87		-	develop guidelines to assist the Investment Committee in identifying and evaluating
88		-	qualified minority business enterprises in order to help the State Retirement Agency
89		-	achieve the objective for greater use of minority business enterprises for brokerage and
90		-	investment management services.
	79	+	2. MANAGEMENT OF AT LEA ST 20% OF THE ASSETS OF 21
	80	+	THE SEVERAL SYSTEMS . 22
91	81
92		-	(4) On or before September 1 each year, the Investment Committee shall
93		-	submit a report to the Board of Trustees, the Governor’s Office of Small, Minority, and
94		-	Women Business Affairs and, subject to § 2–1257 of the State Government Article, the
95		-	General Assembly on: LAWRENCE J. HOGAN, JR., Governor Ch. 641
	82	+	(III) (II) FOR THE FISCAL YEAR B EGINNING JULY 1, 2022, AND 23
	83	+	EACH FISCAL YEAR THE REAFTER, THE BOARD OF TRUSTEES SHALL ASSESS THE USE 24
	84	+	OF MINORITY BUSINESS ENTERPRISES AS REQUI RED UNDER THIS SUBSE CTION. 25
96	85
97		-	– 3 –
	86	+	(IV) (III) For purposes of this subsection, brokerage and investment 26
	87	+	management services shall include services relating to all allocated asset classes. 27
98	88
99		-	(i) the identity of the minority business enterprise brokerage and
100		-	investment management services firms used by the Investment Committee in the
101		-	immediately preceding fiscal year;
	89	+	(2) (i) To assist it in achieving the [goal] GOALS described under 28
	90	+	paragraph (1) of this subsection, the Investment Committee shall undertake measures to 29
	91	+	remove any barriers that limit full participation by minority business enterprises in 30
	92	+	brokerage and investment management services opportunities afforded under this title. 31
102	93
103		-	(ii) the percentage and dollar value of the assets that are under the
104		-	control of the Investment Committee that are under the investment control of minority
105		-	business enterprise brokerage and investment management services firms for each
106		-	allocated asset class; and
	94	+	(ii) The measures undertaken by the Investment Committee shall 32
	95	+	include the use of a wide variety of media, including the State Retirement Agency’s website, 33
	96	+	to provide notice to a broad and varied range of potential providers about the brokerage 34 HOUSE BILL 542 3
107	97
108		-	(iii) the measures the Investment Committee undertook in the
109		-	immediately preceding fiscal year in accordance with paragraph (2)(ii) of this subsection.
110	98
111		-	SECTION 2. AND BE IT FURTHER ENACTED, That:
	99	+	and investment management services opportunities afforded by the State Retirement 1
	100	+	Agency. 2
112	101
113		-	(a) The certification agency designated by the Board of Public Works under §
114		-	14–303(b) of the State Finance and Procurement Article and the Governor’s Office of Small,
115		-	Minority, and Women Business Affairs, in consultation with the State Retirement and
116		-	Pension System, the Office of the Attorney General, and the General Assembly, shall
117		-	initiate a study regarding the brokerage and investment services used by the State
118		-	Retirement and Pension System to evaluate whether the enactment of remedial measures
119		-	to assist minority and women–owned businesses in the brokerage and investment
120		-	management services industry and market would comply with the Croson decision and any
121		-	subsequent federal or constitutional requirements.
	102	+	(3) In consultation with the Governor’s Office of Small, Minority, and 3
	103	+	Women Business Affairs and the Investment Committee, the Board of Trustees shall 4
	104	+	develop guidelines to assist the Investment Committee in identifying and evaluating 5
	105	+	qualified minority business enterprises in order to help the State Retirement Agency 6
	106	+	achieve the objective for greater use of minority business enterprises for brokerage and 7
	107	+	investment management services. 8
122	108
123		-	(b) The certification agency and the Governor’s Office of Small, Minority, and
124		-	Women Business Affairs shall submit the findings of the study required under subsection
125		-	(a) of this section to the Legislative Policy Committee, in accordance with § 2–1257 of the
126		-	State Government Article, on or before July 1, 2023, so that the General Assembly may
127		-	review the findings before the 2024 Session.
	109	+	(4) On or before September 1 each year, the Investment Committee shall 9
	110	+	submit a report to the Board of Trustees, the Governor’s Office of Small, Minority, and 10
	111	+	Women Business Affairs and, subject to § 2–1257 of the State Government Article, the 11
	112	+	General Assembly on: 12
128	113
129		-	(c) The State Retirement and Pension System shall provide to the certification
130		-	agency any information deemed necessary to assess the need for remedial measures to
131		-	assist minority and women–owned businesses in the brokerage and investment
132		-	management services industry and market.
	114	+	(i) the identity of the minority business enterprise brokerage and 13
	115	+	investment management services firms used by the Investment Committee in the 14
	116	+	immediately preceding fiscal year; 15
133	117
134		-	(d) The Governor’s Office of Small, Minority, and Women Business Affairs, in
135		-	consultation with the certification agency and the Office of the Attorney General, shall
136		-	develop race– and gender–neutral approaches to address the needs of minority and
137		-	women–owned businesses in the brokerage and investment management services industry
138		-	and market and submit its report to the Legislative Policy Committee, in accordance with
139		-	§ 2–1257 of the State Government Article, on or before December 1, 2022, so that the
140		-	General Assembly may review, consider, and adopt race– and gender–neutral alternatives
141		-	to remedial measures that are not race and gender neutral.
142		-	Ch. 641 2022 LAWS OF MARYLAND
	118	+	(ii) the percentage and dollar value of the assets that are under the 16
	119	+	control of the Investment Committee that are under the investment control of minority 17
	120	+	business enterprise brokerage and investment management services firm s for each 18
	121	+	allocated asset class; and 19
143	122
144		-	– 4 –
145		-	SECTION 2. 3. AND BE IT FURTHER ENACTED, That this Act shall take effect
146		-	July June 1, 2022. Section 2 of this Act shall remain effective for a period of 1 year and 1
147		-	month and, at the end of June 30, 2023, Section 2 of this Act, with no further action required
148		-	by the General Assembly, shall be abrogated and of no further force and effect.
	123	+	(iii) the measures the Investment Committee undertook in the 20
	124	+	immediately preceding fiscal year in accordance with paragraph (2)(ii) of this subsection. 21
149	125
150		-	Enacted under Article II, § 17(c) of the Maryland Constitution, May 29, 2022.
	126	+	SECTION 2. AND BE IT FURTHER ENACTED, That: 22
	127	+
	128	+	(a) The certification agency designated by the Board of Public Works under § 23
	129	+	14–303(b) of the State Finance and Procurement Article and the Governor’s Office of Small, 24
	130	+	Minority, and Women Business Affairs, in consultation with the State Retirement and 25
	131	+	Pension System, the Office of the Attorney General, and the General Assembly, shall 26
	132	+	initiate a study regarding the brokerage and investment services used by the State 27
	133	+	Retirement and Pension System to evaluate whether the enactment of remedial measures 28
	134	+	to assist minority and women–owned businesses in the brokerage and investment 29
	135	+	management services industry and market would comply with the Croson decision and any 30
	136	+	subsequent federal or constitutional requirements. 31
	137	+
	138	+	(b) The certification agency and the Governor’s Office of Small, Minority, and 32
	139	+	Women Business Affairs shall submit the findings of the study required under subsection 33
	140	+	(a) of this section to the Legislative Policy Committee, in accordance with § 2–1257 of the 34
	141	+	State Government Article, on or before July 1, 2023, so that the General Assembly may 35
	142	+	review the findings before the 2024 Session. 36
	143	+
	144	+	(c) The State Retirement and Pension System shall provide to the certification 37
	145	+	agency any information deemed necessary to assess the need for remedial measures to 38 4 HOUSE BILL 542
	146	+
	147	+
	148	+	assist minority and women–owned businesses in the brokerage and investment 1
	149	+	management services industry and market. 2
	150	+
	151	+	(d) The Governor’s Office of Small, Minority, and Women Business Affairs, in 3
	152	+	consultation with the certification agency and the Office of the Attorney General, shall 4
	153	+	develop race– and gender–neutral approaches to address the needs of minority and 5
	154	+	women–owned businesses in the brokerage and investment management services industry 6
	155	+	and market and submit its report to the Legislative Policy Committee, in accordance with 7
	156	+	§ 2–1257 of the State Government Article, on or before December 1, 2022, so that the 8
	157	+	General Assembly may review, consider, and adopt race– and gender–neutral alternatives 9
	158	+	to remedial measures that are not race and gender neutral. 10
	159	+
	160	+	SECTION 2. 3. AND BE IT FURTHER ENACTED, That this Act shall take effect 11
	161	+	July June 1, 2022. Section 2 of this Act shall remain effective for a period of 1 year and 1 12
	162	+	month and, at the end of June 30, 2023, Section 2 of this Act, with no further action required 13
	163	+	by the General Assembly, shall be abrogated and of no further force and effect. 14
	164	+
	165	+
	166	+
	167	+
	168	+	Approved:
	169	+	________________________________________________________________________________
	170	+	Governor.
	171	+	________________________________________________________________________________
	172	+	Speaker of the House of Delegates.
	173	+	________________________________________________________________________________
	174	+	President of the Senate.