EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTING LAW.
[Brackets] indicate matter deleted from existing law.
*sb0830*
SENATE BILL 830
M1 2lr2868
CF 2lr2871
By: Senators Elfreth, Bailey, Eckardt, Guzzone, and Hershey
Introduced and read first time: February 7, 2022
Assigned to: Education, Health, and Environmental Affairs and Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Natural Resources – Oysters – Spat, Shells, and Substrate 2
FOR the purpose of establishing various programs, goals, research requirements, planning 3
requirements, and funding requirements related to oyster spat, oyster shells, and 4
oyster substrate; requiring the Maryland Agricultural and Resource–Based Industry 5
Development Corporation to provide loans and grants up to a certain amount to 6
finance the eligible costs of certain eligible seafood processing projects; replacing the 7
oyster shell recycling tax credit with an annual grant program administered by the 8
Department of Natural Resources; requiring the Maryland Geological Survey, in 9
conjunction with certain other entities, to conduct certain bottom surveys; requiring 10
the University of Maryland Center for Environmental Science to conduct research 11
related to substrate in collaboration with certain entities; requiring the Department 12
to develop a certain substrate plan; providing for the construction and expansion of 13
certain oyster hatcheries; and generally relating to oysters. 14
BY repealing 15
Article – Tax – General 16
Section 10–724.1 17
Annotated Code of Maryland 18
(2016 Replacement Volume and 2021 Supplement) 19
BY repealing and reenacting, without amendments, 20
Article – Economic Development 21
Section 10–501(a), (f), and (l) 22
Annotated Code of Maryland 23
(2018 Replacement Volume and 2021 Supplement) 24
BY adding to 25
Article – Economic Development 26
Section 10–519.1 27
Annotated Code of Maryland 28 2 SENATE BILL 830
(2018 Replacement Volume and 2021 Supplement) 1
BY repealing 2
Article – Natural Resources 3
Section 4–1019.1 4
Annotated Code of Maryland 5
(2018 Replacement Volume and 2021 Supplement 6
BY adding to 7
Article – Natural Resources 8
Section 4–1019.1 and 4–1019.2(g) 9
Annotated Code of Maryland 10
(2018 Replacement Volume and 2021 Supplement) 11
BY repealing and reenacting, with amendments, 12
Article – Natural Resources 13
Section 4–1102 14
Annotated Code of Maryland 15
(2018 Replacement Volume and 2021 Supplement) 16
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 17
That the Laws of Maryland read as follows: 18
Article – Tax – General 19
[10–724.1. 20
(a) (1) Subject to the limitations of this section, an individual or a corporation 21
may claim a credit against the State income tax in an amount equal to $5 for each bushel 22
of oyster shells recycled during the taxable year. 23
(2) An individual or a corporation that claims the credit under this section 24
shall provide verification of the amount of oyster shells recycled during the taxable year 25
with the individual or corporation tax return. 26
(b) (1) For any taxable year, the credit allowed under this section may not 27
exceed the lesser of: 28
(i) $1,500; or 29
(ii) the State income tax calculated before application of the credit 30
allowed under this section and §§ 10–701 and 10–701.1 of this subtitle. 31
(2) The unused amount of the credit may not be carried over to any other 32
taxable year. 33
SENATE BILL 830 3
(c) (1) The Department of Natural Resources and the Comptroller jointly shall 1
adopt regulations to carry out the provisions of this section. 2
(2) The regulations shall establish eligibility criteria and provide for the 3
certification of businesses, landfills, and nonprofit organizations to verify the amount of 4
oyster shells recycled by each individual or corporation.] 5
SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland read 6
as follows: 7
Article – Economic Development 8
10–501. 9
(a) In this subtitle the following words have the meanings indicated. 10
(f) “Corporation” means the Maryland Agricultural and Resource –Based 11
Industry Development Corporation. 12
(l) (1) “Project” means any property, the acquisition or improvement of which 13
the Board, in its sole discretion, determines by resolution will accomplish at least one of the 14
purposes listed in § 10–502 of this subtitle, whether or not the property, or any interest in 15
the property: 16
(i) is or will be used or operated for profit or not for profit; 17
(ii) is or will be located on one or more sites; or 18
(iii) may be financed by bonds, the interest on which is exempt from 19
taxation under federal law. 20
(2) “Project” includes: 21
(i) property and rights related to the property, appurtenances, 22
rights–of–way, franchises, easements, and other interests in property; 23
(ii) structures, equipment, furnishings, rail or motor vehicles, 24
barges, and boats; 25
(iii) property that is functionally related and subordinate to a project; 26
and 27
(iv) patents, licenses, and other rights necessary or useful in the 28
improvement or operation of a project. 29
10–519.1. 30
4 SENATE BILL 830
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 1
INDICATED. 2
(2) “ELIGIBLE SEAFOOD PROC ESSING PROJECT ” MEANS A PROJECT 3
TO ESTABLISH OR EXPAND THE BUSINE SS OF A LICENSED SEA FOOD DEALER THAT: 4
(I) SUPPORTS THE GOAL OF INCREASING THE AM OUNT OF 5
OYSTER SHELL S RETAINED IN THE STATE AND RETURNED TO THE CHESAPEAKE 6
BAY; AND 7
(II) MEETS THE CRITERIA E STABLISHED BY THE CORPORATION 8
UNDER THIS SECTION. 9
(3) “LICENSED SEAFOOD DEAL ER” MEANS A PERSON LICEN SED 10
UNDER § 4–701 OF THE NATURAL RESOURCES ARTICLE TO BUY, PROCESS, PACK, 11
RESELL, MARKET OR OTHERWISE DEAL IN FISH CAUGHT IN THE TIDAL WATERS OF 12
THE STATE. 13
(B) (1) THE CORPORATION SHALL PRO VIDE LOANS AND GRANT S UP TO 14
$250,000 TO FINANCE THE COSTS OF ELIGIBLE SEAFOOD PRO CESSING PROJECTS IN 15
ACCORDANCE WITH THIS SECTION. 16
(2) FINANCING PROVIDED UN DER THIS SECTIO N SHALL BE 17
CONDITIONED ON THE A GREEMENT BY THE RECI PIENT TO RETURN, AT NO COST TO 18
THE STATE, ALL OYSTER SHELLS PROCESSED BY THE REC IPIENT: 19
(I) TO THE DEPARTMENT OF NATURAL RESOURCES, FOR USE 20
IN THE DEPARTMENT ’S REPLETION AND RESTOR ATION ACTIVITIES; OR 21
(II) DIRECTLY TO OYSTER BA RS IN THE PUBLIC FIS HERY OR 22
RESTORATION AREAS , IN ACCORDANCE WITH R EGULATIONS OF THE DEPARTMENT 23
OF NATURAL RESOURCES. 24
(3) THE CORPORATION SHALL FOR GIVE $35 OF ANY LOAN PROVIDED 25
UNDER THIS SECTION F OR EACH BUSHEL OF OY STER SHELLS THAT THE LOAN 26
RECIPIENT RETURNS TO THE DEPARTME NT OF NATURAL RESOURCES OR DIRECTLY 27
TO OYSTER BARS IN ACCORDANCE WITH P ARAGRAPH (2) OF THIS SUBSECTION . 28
(C) A PERSON IS ELIGIBLE T O RECEIVE FINANCING UNDER THIS SECTION I F 29
THE PERSON: 30
(1) (I) HAS BEEN A LICENSED SEAFOOD DEALER FOR A T LEAST 5 31
YEARS; OR 32 SENATE BILL 830 5
(II) HAS HELD A TIDAL FIS H LICENSE ISSUED UND ER § 4–701 OF 1
THE NATURAL RESOURCES ARTICLE FOR AT LEAST 5 YEARS AND AGREES TO 2
OBTAIN A SEAFOOD DEA LER LICENSE ON RECEIVING FINANCING UNDER THIS 3
SECTION; 4
(2) HAS PAID ALL APPLICABLE BUSINESS TAXES AND F EES FOR THE 5
PAST 5 YEARS; 6
(3) DEMONSTRATES TO THE SATISFACTION OF THE CORPORATION 7
THAT, WITHIN 5 YEARS AFTER RECEIVIN G FINANCING UNDER TH IS SECTION, THE 8
PERSON’S SEAFOOD PROCESSING BUSINESS WILL: 9
(I) EMPLOY AT LEAST 15 INDIVIDUALS; AND 10
(II) ACHIEVE VIABILITY AS A BUSINESS; AND 11
(4) MEETS ANY OTHER ELIG IBILITY REQUIREMENTS ESTABLISHED BY 12
THE CORPORATION . 13
(D) FOR FISCAL YEAR 2024, THE GOVERNOR SHALL INCLUD E IN THE 14
ANNUAL BUDGET BILL A N APPROPRIATION OF $1,000,000 TO THE CORPORATION 15
FOR THE PURPOSE OF PROVIDING GRANTS AND LOANS UND ER THIS SECTION. 16
Article – Natural Resources 17
[4–1019.1. 18
The Department shall initiate the development of a program for enactment by the 19
Maryland General Assembly to encourage return of the State’s oyster shell resource to the 20
tidal waters of the State to assist oyster propagation. The Department also may use the 21
Fisheries Research and Development Fund to purchase oyster shell.] 22
4–1019.1. 23
(A) THE DEPARTMENT SHALL PROV IDE ANNUAL GRANTS TO NONPROFIT 24
ORGANIZATIO NS, COMMUNITY ASSOCIATIO NS, RESTAURANTS , AND SEAFOOD 25
PROCESSORS THAT RECY CLE OYSTER SHELLS . 26
(B) (1) GRANTS TO NONPROFIT ORGANIZ ATIONS AND COMMUNITY 27
ASSOCIATIONS SHALL BE PROVIDED IN THE FOLLOWING AMOUNT S: 28
(I) $100 FOR THE RECYCLING OF AT LEAST 5 BUT LESS THAN 20 29
BUSHELS OF OYSTER SHELLS IN A YEAR; AND 30 6 SENATE BILL 830
(II) $250 FOR THE RECYCLING OF AT LEAST 20 BUSHELS OF 1
OYSTER SHELLS IN A Y EAR. 2
(2) GRANTS TO RESTAURANTS AND SEAFOOD PROCESSO RS SHALL BE 3
PROVIDED IN THE FOLL OWING AMOUNTS : 4
(I) $100 FOR THE RECYCLING OF AT LEAST 25 BUT LESS THAN 5
50 BUSHELS OF OYSTER SH ELLS IN A YEAR; 6
(II) $250 FOR THE RECYCLING OF AT LEAST 50 BUT LESS THAN 7
100 BUSHELS OF OYSTER SH ELLS IN A YEAR; 8
(III) $500 FOR THE RECYCLING OF AT LEAST 100 BUT LESS THAN 9
250 BUSHELS OF OYSTER SH ELLS IN A YEAR; 10
(IV) $1,000 FOR THE RECYCLING OF AT LEAST 250 BUT LESS 11
THAN 500 BUSHELS OF OYSTER SH ELLS IN A YEAR; 12
(V) $1,500 FOR THE RECYCLING OF AT LEAST 500 BUT LESS 13
THAN 1,000 BUSHELS OF OYSTER SHELLS IN A YEAR; AND 14
(VI) $2,000 FOR THE RECYCLING OF AT LEAST 1,000 BUSHELS 15
OF OYSTER SHELLS IN A YEAR. 16
(C) THE DEPARTMENT SHALL PROVIDE, AT NO COST, RECEPTACLES FOR 17
THE COLLECTION OF OY STER SHELLS TO RESTAURANTS THAT AGREE TO RECYCLE 18
AT LEAST 25 BUSHELS OF OYSTER SH ELLS PER YEAR. 19
(D) (1) THE DEPARTMENT SHALL ADOP T REGULATIONS TO CAR RY OUT 20
THE PROVISIONS OF TH IS SECTION. 21
(2) THE REGULATIONS SHALL ESTABLISH ELIGIBILIT Y CRITERIA AND 22
PROVIDE FOR THE CERT IFICATION OF NONPROFIT ORGANIZATI ONS, COMMUNITY 23
ASSOCIATIONS, RESTAURANTS , AND SEAFOOD PROCESSO RS TO VERIFY THE 24
AMOUNT OF OYSTER SHE LLS RECYCLED BY EACH ENTITY. 25
4–1019.2. 26
(G) THE DEPARTMENT MAY USE TH E FISHERIES RESEARCH AND 27
DEVELOPMENT FUND TO PURCHASE OYST ER SHELLS. 28
4–1102. 29
SENATE BILL 830 7
(a) The Department may resurvey any submerged area of the State to determine 1
the position and extent of any natural oyster bar. 2
(b) If, after conducting a survey in accordance with subsection (a) of this section, 3
the Department finds that any natural oyster bar is located incorrectly on existing charts 4
or that the existing charts do not reflect the actual condition of submerged lands, the 5
Department shall amend the existing charts or coordinates by regulation. 6
(C) (1) BEGINNING IN FISCAL YEAR 2024, THE MARYLAND GEOLOGICAL 7
SURVEY, IN CONJUNCTION WITH THE UNIVERSITY OF MARYLAND CENTER FOR 8
ENVIRONMENTAL SCIENCE, SHALL SURVEY SUBMERGED ARE AS OF THE STATE IN 9
ACCORDANCE WITH THE PROVISIONS OF THIS S UBSECTION. 10
(2) IN SELECTING SITES FO R SURVEYING UNDER THIS SUB SECTION, 11
THE MARYLAND GEOLOGICAL SURVEY AND THE UNIVERSITY OF MARYLAND 12
CENTER FOR ENVIRONMENTAL SCIENCE SHALL: 13
(I) PRIORITIZE: 14
1. EASTERN BAY AND ITS TRIBUTARI ES; AND 15
2. PUBLIC FISHERY AREAS WHERE THERE ARE LIKE LY 16
TO BE SHALLOWLY BURIED SHE LL DEPOSITS FROM PRE VIOUS REPLETION 17
ACTIVITIES, IDENTIFIED IN CONSUL TATION WITH COMMERCI AL OYSTER 18
HARVESTERS ; AND 19
(II) AVOID IMPORTANT FISH SPAWN ING AREAS, ESPECIALLY 20
AREAS WHERE STRIPED BASS O R STURGEON ARE KNOWN TO SPAWN. 21
(3) TO THE EXTENT PRACTIC ABLE, SURVEYS CARRIED OUT UNDER 22
THIS SUBSECTION SHALL USE SUB–BOTTOM PROFILING COM BINED WITH PHYSICAL 23
SAMPLING TO QUANTIFY THE TOTAL VOLUME OF SUBSURFACE SHELL MAT ERIAL. 24
(4) (I) FOR FISCAL YEARS 2024 THROUGH 2026, THE GOVERNOR 25
SHALL INCLUDE IN THE ANNUAL BUDGET BILL A N APPROPRIATION OF $2,000,000 26
TO FUND THE SURVEYS REQ UIRED UNDER THIS SUB SECTION. 27
(II) THE GOVERNOR SHALL PRIORI TIZE THE USE OF FEDE RAL 28
FUNDS FOR APPROPRIAT IONS REQUIRED UNDER THIS PARAGRAPH . 29
SECTION 3. AND BE IT FURTHER ENACTED, That : 30
(a) The University of Maryland Center for Environmental Science shall 31
collaborate with the Smithsonian Environmental Research Center, the Virginia Institute 32 8 SENATE BILL 830
of Marine Science, appropriate State and federal agencies, and industry and other 1
stakeholders to research: 2
(1) the types of substrate, including fresh shell, fossilized shell, 3
combinations of shell, and alternative substrates, that are most appropriate for use in 4
oyster harvest areas; 5
(2) the benefits, including habitat–related benefits, of using larger stones 6
versus smaller stones in oyster restoration areas; 7
(3) alternative substrates used for oyster restoration or repletion in other 8
regions, including the success of efforts to use alternative substrates; and 9
(4) the potential for retrofitting existing structures, such as riprap 10
revetments, that are unrelated to oyster restoration but that use materials similar to 11
artificial reefs, to include oyster plantings. 12
(b) On or before December 1, 2025, the University of Maryland Center for 13
Environmental Science shall report to the Secretary of Natural Resources and, in 14
accordance with § 2–1257 of the State Government Article, the General Assembly on its 15
research findings under this section. 16
(c) For fiscal years 2024 and 2025, the Governor shall include in the annual 17
budget bill an appropriation of $250,000 for the University of Maryland Center for 18
Environmental Science to carry out the research required under this section. 19
SECTION 4. AND BE IT FURTHER ENACTED, That: 20
(a) On or before December 1, 2023, the Department of Natural Resources shall 21
submit a plan to the Governor and, in accordance with § 2–1257 of the State Government 22
Article, the General Assembly describing the substrate needs for oyster restoration and 23
repletion activities in the State over the next 10 years. 24
(b) The plan shall include: 25
(1) an estimate of the quantity of the substrate materials that will be 26
needed and the purposes for which the substrate materials will be used; 27
(2) an overview of the full spectrum of substrate materials available; 28
(3) an analysis of the availability, sourcing, and relative cost of each 29
substrate material; 30
(4) an estimate of the total and annual costs of implementing the plan; and 31
(5) opportunities for improving the cost–effectiveness of substrate 32
acquisition and use, including opportunities for increasing coordination with the 33 SENATE BILL 830 9
Commonwealth of Virginia, undertaking larger–scale projects to take advantage of 1
economies of scale, and reducing mobilization and demobilization costs. 2
SECTION 5. AND BE IT FURTHER ENACTED, That : 3
(a) It is the intent of the General Assembly that by 2025, oyster hatcheries in the 4
State shall be capable of producing 5 billion spat–on–shell per year. 5
(b) To reach the goal established under subsection (a) of this section, for fiscal 6
year 2024, the Governor shall include in the annual operating or capital budget: 7
(1) an appropriation of $20,000,000 for the University of Maryland Center 8
for Environmental Science to build a second oyster hatchery, to be named after Michael E. 9
Busch, former Speaker of the House of Delegates; and 10
(2) an appropriation of $2,500,000 for the Patuxent Environmental and 11
Aquatic Research Laboratory, Morgan State University, to be used for infrastructure 12
upgrades to support increased oyster production for research and restoration. 13
SECTION 6. AND BE IT FURTHER ENACTED, That Section 1 of this Act shall be 14
applicable to all taxable years beginning after December 31, 2021. 15
SECTION 7. AND BE IT FURTHER ENACTED, That this Act shall take effect July 16
1, 2022. 17