EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
Underlining indicates amendments to bill.
Strike out indicates matter stricken from the bill by amendment or deleted from the law by
amendment.
*sb0830*
SENATE BILL 830
M1 2lr2868
CF HB 1228
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
Committee Report: Favorable with amendments
Senate action: Adopted
Read second time: March 10, 2022
CHAPTER ______
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
evaluations related to substrate in collaboration with certain entities; requiring the 12
Department to develop a certain substrate plan; providing for the construction and 13
expansion of certain oyster hatcheries; providing for oyster replenishment and 14
restoration in Eastern Bay; and generally relating to oysters. 15
BY repealing 16
Article – Tax – General 17
Section 10–724.1 18
Annotated Code of Maryland 19
(2016 Replacement Volume and 2021 Supplement) 20
BY repealing and reenacting, without amendments, 21
Article – Economic Development 22
Section 10–501(a), (f), and (l) 23 2 SENATE BILL 830
Annotated Code of Maryland 1
(2018 Replacement Volume and 2021 Supplement) 2
BY adding to 3
Article – Economic Development 4
Section 10–519.1 5
Annotated Code of Maryland 6
(2018 Replacement Volume and 2021 Supplement) 7
BY repealing 8
Article – Natural Resources 9
Section 4–1019.1 10
Annotated Code of Maryland 11
(2018 Replacement Volume and 2021 Supplement 12
BY adding to 13
Article – Natural Resources 14
Section 4–1019.1 and 4–1019.2(g) 15
Annotated Code of Maryland 16
(2018 Replacement Volume and 2021 Supplement) 17
BY repealing and reenacting, with amendments, 18
Article – Natural Resources 19
Section 4–1102 20
Annotated Code of Maryland 21
(2018 Replacement Volume and 2021 Supplement) 22
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 23
That the Laws of Maryland read as follows: 24
Article – Tax – General 25
[10–724.1. 26
(a) (1) Subject to the limitations of this section, an individual or a corporation 27
may claim a credit against the State income tax in an amount equal to $5 for each bushel 28
of oyster shells recycled during the taxable year. 29
(2) An individual or a corporation that claims the credit under this section 30
shall provide verification of the amount of oyster shells recycled during the taxable year 31
with the individual or corporation tax return. 32
(b) (1) For any taxable year, the credit allowed under this section may not 33
exceed the lesser of: 34
(i) $1,500; or 35
SENATE BILL 830 3
(ii) the State income tax calculated before application of the credit 1
allowed under this section and §§ 10–701 and 10–701.1 of this subtitle. 2
(2) The unused amount of the credit may not be carried over to any other 3
taxable year. 4
(c) (1) The Department of Natural Resources and the Comptroller jointly shall 5
adopt regulations to carry out the provisions of this section. 6
(2) The regulations shall establish eligibility criteria and provide for the 7
certification of businesses, landfills, and nonprofit organizations to verify the amount of 8
oyster shells recycled by each individual or corporation.] 9
SECTION 2. AND BE IT FURTHER ENACTED, That the Laws of Maryland read 10
as follows: 11
Article – Economic Development 12
10–501. 13
(a) In this subtitle the following words have the meanings indicated. 14
(f) “Corporation” means the Maryland Agricultural and Resource–Based 15
Industry Development Corporation. 16
(l) (1) “Project” means any property, the acquisition or improvement of which 17
the Board, in its sole discretion, determines by resolution will accomplish at least one of the 18
purposes listed in § 10–502 of this subtitle, whether or not the property, or any interest in 19
the property: 20
(i) is or will be used or operated for profit or not for profit; 21
(ii) is or will be located on one or more sites; or 22
(iii) may be financed by bonds, the interest on which is exempt from 23
taxation under federal law. 24
(2) “Project” includes: 25
(i) property and rights related to the property, appurtenances, 26
rights–of–way, franchises, easements, and other interests in property; 27
(ii) structures, equipment, furnishings, rail or motor vehicles, 28
barges, and boats; 29
(iii) property that is functionally related and subordinate to a project; 30
and 31 4 SENATE BILL 830
(iv) patents, licenses, and other rights necessary or useful in the 1
improvement or operation of a project. 2
10–519.1. 3
(A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 4
INDICATED. 5
(2) “ELIGIBLE SEAFOOD PROC ESSING PROJECT ” MEANS A PROJECT 6
TO ESTABLISH OR EXPAND THE BUSINE SS OF A LICENSED SEA FOOD DEALER THAT: 7
(I) SUPPORTS THE GOAL OF INCREASING THE AM OUNT OF 8
OYSTER SHELL S RETAINED IN THE STATE AND RETURNED TO THE CHESAPEAKE 9
BAY; AND 10
(II) MEETS THE CRITERIA E STABLISHED BY THE CORPORATION 11
UNDER THIS SECTION . 12
(3) “LICENSED SEAFOOD DEAL ER” MEANS A PERSON LICEN SED 13
UNDER § 4–701 OF THE NATURAL RESOURCES ARTICLE TO BUY, PROCESS, PACK, 14
RESELL, MARKET OR OTHERWISE DEAL IN FISH CAUGHT IN THE TIDAL WATERS OF 15
THE STATE. 16
(4) “REPLETION” MEANS ENHANCING AREA S WHERE COMMER CIAL 17
HARVEST IS PERMITTED . 18
(B) (1) THE CORPORATION SHALL PRO VIDE LOANS AND GRANTS UP TO 19
$250,000 TO FINANCE THE COSTS OF ELIGIBLE SEAFOOD PRO CESSING PROJECTS IN 20
ACCORDANCE WITH THIS SECTION, INCLUDING HISTORIC O YSTER SHUCKING 21
FACILITIES, NOT TO EXCEED $25,000 FOR EACH FULL –TIME JOB THAT IS 22
PROJECTED TO BE CREA TED OR RETAINED . 23
(2) FINANCING PROVIDED UN DER THIS SECTIO N SHALL BE 24
CONDITIONED ON THE A GREEMENT BY THE RECI PIENT TO RETURN, AT NO COST TO 25
THE STATE, ALL OYSTER SHELLS PROCESSED BY THE REC IPIENT: 26
(I) TO THE DEPARTMENT OF NATURAL RESOURCES, FOR USE 27
IN THE DEPARTMENT ’S REPLETION AND RESTOR ATION ACTIVITIES; OR 28
(II) DIRECTLY TO OYSTER BA RS IN THE PUBLIC FIS HERY OR 29
RESTORATION AREAS , IN ACCORDANCE WITH R EGULATIONS OF THE DEPARTMENT 30
OF NATURAL RESOURCES COMPLY WITH THE PROV ISIONS OF § 4–1019.2 OF THE 31
NATURAL RESOURCES ARTICLE UNTIL THE LOA N IS REPAID. 32 SENATE BILL 830 5
(3) THE CORPORATION SHALL FOR GIVE $35 OF ANY LOAN PROVIDED 1
UNDER THIS SECTION AS FOLLOWS: 2
(I) THE CURRENT MARKET V ALUE AS ESTABLISHED IN § 3
4–1019.2 OF THE NATURAL RESOURCES ARTICLE FOR EACH BUSHEL OF O YSTER 4
SHELLS THAT THE LOAN RECIPI ENT RETURNS TO THE DEPARTMENT OF NATURAL 5
RESOURCES AT NO COST; OR DIRECTLY TO OYSTER B ARS IN ACCORDANCE WITH 6
PARAGRAPH (2) OF THIS SUBSECTION 7
(II) $25 FOR EACH BUSHEL OF S PAT–ON–SHELL THAT THE 8
PERSON PLANTS ON A P UBLIC FISHERY BOTTOM AS VERIFIED BY THE DEPARTMENT 9
OF NATURAL RESOURCES. 10
(C) A PERSON IS ELIGIBLE T O RECEIVE FINANCING UNDER THIS SECTION I F 11
THE PERSON: 12
(1) (I) HAS BEEN A LICENSED SEAFOOD DEALER FOR A T LEAST 5 13
YEARS; OR 14
(II) HAS HELD A TIDAL FIS H LICENSE ISSUED UND ER § 4–701 OF 15
THE NATURAL RESOURCES ARTICLE FOR AT LEAST 5 YEARS AND AGREES TO 16
OBTAIN A SEAFOOD DEA LER LICENSE ON RECEIVING FINANCING UNDER THIS 17
SECTION; 18
(2) HAS PAID ALL APPLICABLE BUSINESS TAXES AND FEES FOR THE 19
PAST 5 YEARS; 20
(3) DEMONSTRATES TO THE SATISFACTION OF THE CORPORATION 21
THROUGH A BUSINESS P LAN AND PRO FORMA FI NANCIAL PROJECTIONS THAT, 22
WITHIN 5 YEARS AFTER RECEIVING FINANCING UNDER THIS SECTION , THE 23
PERSON’S SEAFOOD PROCESSING BUSINESS WILL: 24
(I) EMPLOY AT LEAST 15 INDIVIDUALS; AND 25
(II) HAVE THE POTENTIAL T O ACHIEVE VIABILITY AS A 26
BUSINESS; AND 27
(4) MEETS ANY OTHER ELIG IBILITY REQUIREMENTS ESTABLISHED BY 28
THE CORPORATION ; AND 29
6 SENATE BILL 830
(5) AGREES TO THE FINANC ING TERMS AND CONDIT IONS 1
ESTABLISHED BY THE CORPORATION THAT ARE OTHERWISE IN CONFORM ANCE 2
WITH THIS SECTION . 3
(D) (1) FOR FISCAL YEAR 2024, THE GOVERNOR SHALL INCLUD E IN THE 4
ANNUAL BUDGET BILL A N APPROPRIATION OF $1,000,000 TO THE CORPORATION 5
FOR THE PURPOSE OF P ROVIDING GRANTS AND LOANS UNDER THIS SEC TION. 6
(2) THE APPROPRIATION IN PARAGRAPH (1) OF THIS SUBSECTION 7
SHALL BE DISTRIBUTED TO A SPECIAL ACCOUNT TO BE USED ONLY TO : 8
(I) PROVIDE LOANS UNDER THIS SECTION; AND 9
(II) PAY THE COSTS NECESS ARY TO ADMINISTER AN D OPERATE 10
THIS SECTION. 11
Article – Natural Resources 12
[4–1019.1. 13
The Department shall initiate the development of a program for enactment by the 14
Maryland General Assembly to encourage return of the State’s oyster shell resource to the 15
tidal waters of the State to assist oyster propagation. The Department also may use the 16
Fisheries Research and Development Fund to purchase oyster shell.] 17
4–1019.1. 18
(A) THE DEPARTMENT SHALL PROV IDE ANNUAL GRANTS TO NONPROFIT 19
ORGANIZATION S, COMMUNITY ASSOCIATIO NS, RESTAURANTS , AND SEAFOOD 20
PROCESSORS AND DEALERS THAT RECYCLE OYSTER SHELLS BY PROVIDING THE 21
SHELL TO AN AUTHORIZED SHELL REC YCLING COLLECTOR CER TIFIED BY THE 22
DEPARTMENT . 23
(B) (1) GRANTS TO NONPROFIT ORGANIZ ATIONS AND COMMUNITY 24
ASSOCIATIONS SHALL BE PROVIDED IN THE FOLLOWING AMOUNT S: 25
(I) $100 FOR THE RECYCLING OF AT LEAST 5 BUT LESS THAN 20 26
BUSHELS OF OYSTER SHELLS IN A YEAR; AND 27
(II) $250 FOR THE RECYCLING OF AT LEAST 20 BUSHELS OF 28
OYSTER SHELLS IN A Y EAR. 29
(2) GRANTS TO RESTAURANTS AND SEAFOOD PROCESSO RS AND 30
DEALERS SHALL BE PROVIDED IN THE FOLLOWING AMO UNTS: 31 SENATE BILL 830 7
(I) $100 FOR THE RECYCLING OF AT LEAST 25 BUT LESS THAN 1
50 BUSHELS OF OYSTER SH ELLS IN A YEAR; 2
(II) $250 FOR THE RECYCLING OF AT LEAST 50 BUT LESS THAN 3
100 BUSHELS OF OYSTER SH ELLS IN A YEAR; 4
(III) $500 FOR THE RECYCLING OF AT LEAST 100 BUT LESS THAN 5
250 BUSHELS OF OYSTER SH ELLS IN A YEAR; 6
(IV) $1,000 FOR THE RECYCLING OF AT LEAST 250 BUT LESS 7
THAN 500 BUSHELS OF OYSTER SH ELLS IN A YEAR; 8
(V) $1,500 FOR THE RECYCLING OF AT LEAST 500 BUT LESS 9
THAN 1,000 BUSHELS OF OYSTER SH ELLS IN A YEAR; AND 10
(VI) $2,000 FOR THE RECYCLING OF AT LEAS T 1,000 BUSHELS 11
OF OYSTER SHELLS IN A YEAR AT A RATE OF $5 PER BUSHEL UP TO A M AXIMUM OF 12
$2,000 PER YEAR. 13
(C) THE DEPARTMENT SHALL PROVIDE, AT NO COST, RECEPTACLES FOR 14
THE COLLECTION OF OY STER SHELLS TO RESTAURANTS THAT AGREE TO RECYCLE 15
AT LEAST 25 BUSHELS OF OYSTER SH ELLS PER YEAR. 16
(D) (1) THE DEPARTMENT SHALL ADOP T REGULATIONS TO CAR RY OUT 17
THE PROVISIONS OF TH IS SECTION. 18
(2) THE REGULATIONS SHALL ESTABLISH ELIGIBILIT Y CRITERIA AND 19
PROVIDE FOR THE CERT IFICATION OF NONPROFIT ORGANIZATI ONS, COMMUNITY 20
ASSOCIATIONS, RESTAURANTS , AND SEAFOOD PROCESSO RS AND DEALERS TO 21
VERIFY THE AMOUNT OF OYSTER SHELLS RECYCL ED BY EACH ENTITY. 22
(3) THE DEPARTMENT MAY ENTER INTO AGREEMENTS WITH 23
NONPROFIT ORGANIZATI ONS WITH EXPERTISE I N OYSTER SHELL RECYC LING TO 24
EXECUTE THE PROVISIO NS OF THIS SECTION . 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
8 SENATE BILL 830
(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 TO 9
MAP EXISTING AND POT ENTIAL OYSTER HABITA TS IN ACCORDANCE WITH T HE 10
PROVISIONS OF THIS SUBSECTION . 11
(2) IN SELECTING SITES FO R SURVEYING UNDER TH IS SUBSECTION, 12
THE MARYLAND GEOLOGICAL SURVEY AND THE UNIVERSITY OF MARYLAND 13
CENTER FOR ENVIRONMENTAL SCIENCE SHALL: 14
(I) PRIORITIZE PRIORITIZE: 15
1. (I) EASTERN BAY AND ITS TRIBUTARIES; AND 16
2. (II) PUBLIC FISHERY AREAS WHERE THERE ARE LIKE LY 17
TO BE SHALLOWLY BURI ED SHELL DEPOSITS FR OM PREVIOUS REPLETIO N 18
ACTIVITIES, IDENTIFIED IN CONSUL TATION WITH THE DEPARTMENT , WHO SHALL 19
CONSULT WITH COUNTY OYSTER COMMITTEES , AND COMMERCIAL OYSTER 20
HARVESTERS ; AND 21
(II) AVOID IMPORTANT FISH SPAWN ING AREAS, ESPECIALLY 22
AREAS WHERE STRIPED BASS O R STURGEON ARE KNOWN TO SPAWN. 23
(3) TO THE EXTENT PRACTIC ABLE, SURVEYS CARRIED OUT UNDER 24
THIS SUBSECTION SHALL USE SUB–BOTTOM PROFILING COM BINED WITH PHYSICAL 25
SAMPLING TO QUANTIFY THE TOTAL VOLUME OF SUBSURFACE SHELL MAT ERIAL. 26
(4) (I) FOR FISCAL YEARS 2024 THROUGH 2026, THE GOVERNOR 27
SHALL INCLUDE IN THE ANNUAL BUDGET BILL A N APPROPRIATION OF $2,000,000 28
TO THE DEPARTMENT TO FUND THE SURVEYS REQ UIRED UNDER THIS SUB SECTION. 29
(II) THE GOVERNOR SHALL PRIORI TIZE THE USE OF FEDE RAL 30
FUNDS FOR APPROPRIAT IONS REQUIRED UNDER THIS PARAGRAPH . 31
SECTION 3. AND BE IT FURTHER ENACTED, That : 32
SENATE BILL 830 9
(a) The University of Maryland Center for Environmental Science shall 1
collaborate with the Smithsonian Environmental Research Center, the Virginia Institute 2
of Marine Science, appropriate State and federal agencies, and industry and other 3
stakeholders to research evaluate: 4
(1) the types of substrate, including fresh shell, fossilized shell, 5
combinations of shell, and alternative substrates, that are most appropriate for use in 6
oyster harvest areas; 7
(2) the benefits, including habitat–related benefits, of using larger stones 8
versus smaller stones of various sizes in oyster restoration areas; 9
(3) alternative substrates used for oyster restoration or repletion in other 10
regions, including the success of efforts to use alternative substrates; and 11
(4) the potential for retrofitting existing structures, such as riprap 12
revetments, that are unrelated to oyster restoration but that use materials similar to 13
artificial reefs, to include oyster plantings; and 14
(5) the effect of spat size upon deployment on oyster abundance. 15
(b) On or before December 1, 2025, the University of Maryland Center for 16
Environmental Science shall report to the Secretary of Natural Resources and, in 17
accordance with § 2–1257 of the State Government Article, the General Assembly on its 18
research findings evaluations under this section. 19
(c) For fiscal years 2024 and 2025, the Governor shall include in the annual 20
budget bill an appropriation of $250,000 for the University of Maryland Center for 21
Environmental Science to carry out the research required under this section. 22
(d) The evaluations undertaken in accordance with this section shall be conducted 23
in a manner that is not disruptive to the public oyster fishery, aquaculture, or restoration. 24
SECTION 4. AND BE IT FURTHER ENACTED, That: 25
(a) On or before December 1, 2023, the Department of Natural Resources shall 26
submit a plan to the Governor and, in accordance with § 2–1257 of the State Government 27
Article, the General Assembly describing the substrate needs for oyster restoration and 28
repletion, aquaculture, and restoration activities in the State over the next 10 years. 29
(b) The plan shall include: 30
(1) an estimate of the quantity of the substrate materials that will be 31
needed and the purposes for which the substrate materials will be used; 32
(2) an overview of the full spectrum of substrate materials available; 33
10 SENATE BILL 830
(3) an analysis of the availability, sourcing, and relative cost of each 1
substrate material; 2
(4) an estimate of the total and annual costs of implementing the plan; and 3
(5) opportunities for improving the cost–effectiveness of substrate 4
acquisition and use, including opportunities for increasing coordination with the 5
Commonwealth of Virginia, undertaking larger–scale projects to take advantage of 6
economies of scale, and reducing mobilization and demobilization costs. 7
SECTION 5. AND BE IT FURTHER ENACTED, That : 8
(a) It is the intent of the General Assembly that by 2025, oyster hatcheries in the 9
State shall be capable of consistently producing 5 billion larvae or spat–on–shell spat per 10
year. 11
(b) To help reach the goal established under subsection (a) of this section, for 12
fiscal year 2024, the Governor shall include in the annual operating or capital budget: 13
(1) an appropriation of $20,000,000 for the University of Maryland Center 14
for Environmental Science to build a second oyster hatchery, to be named after Michael E. 15
Busch, former Speaker of the House of Delegates; and 16
(2) an appropriation of $2,500,000 for the Patuxent Environmental and 17
Aquatic Research Laboratory, Morgan State University, to be used for infrastructure 18
upgrades to support increased oyster production for research and restoration. 19
SECTION 6. AND BE IT FURTHER ENACTED, That: 20
(a) (1) In recognition of the final report, dated December 1, 2021, of the Oyster 21
Advisory Commission’s consensus recommendations, over the next 25 years, a combination 22
of replenishment, restoration, and aquaculture activities should be collectively planned and 23
undertaken in Eastern Bay, with an equal amount of funding for spat planting in 24
sanctuaries ($1,000,000 annually adjusted for inflation) and for spat and shell planting on 25
fishery bars ($1,000,000 annually adjusted for inflation) in addition to current 26
replenishment and restoration activities. 27
(2) The effectiveness of the activities under paragraph (1) of this subsection 28
shall be evaluated every 5 years. 29
(b) To help reach the goals established under subsection (a) of this section, for 30
fiscal years 2024 through 2026, the Governor shall include in the annual operating or 31
capital budget an appropriation of $2,000,000 for the Department of Natural Resources. 32
(c) Any funding provided in the operating or capital budgets in accordance with 33
subsection (b) of this section after fiscal year 2026 shall be contingent upon the evaluation 34
provided for in subsection (a)(2) of this section. 35 SENATE BILL 830 11
SECTION 6. 7. AND BE IT FURTHER ENACTED, That Section 1 of this Act shall 1
take effect July 1, 2023, and shall be applicable to all taxable years beginning after 2
December 31, 2021 2022. 3
SECTION 7. 8. AND BE IT FURTHER ENACTED, That , except as provided in 4
Section 7 of this Act, this Act shall take effect July 1, 2022. 5
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
President of the Senate.
________________________________________________________________________________
Speaker of the House of Delegates.