MD
Maryland Senate Bill SB885

Maryland 2022 Regular Session

Maryland Senate Bill SB885 Compare Versions

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1- LAWRENCE J. HOGAN, JR., Governor Ch. 391
21
3-– 1 –
4-Chapter 391
5-(Senate Bill 885)
62
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+ *sb0885*
89
9-Maryland Technology Development Corporation – Maryland Equity Investment
10-Fund – Established
10+SENATE BILL 885
11+C8 2lr3138
12+ CF HB 1479
13+By: Senators Griffith and Elfreth
14+Introduced and read first time: February 7, 2022
15+Assigned to: Budget and Taxation
16+Committee Report: Favorable with amendments
17+Senate action: Adopted
18+Read second time: March 4, 2022
1119
12-FOR the purpose of establishing the Maryland Equity Investment Fund in the Maryland
13-Technology Development Corporation; providing for the investment of certain
14-General Fund surplus in certain private equity and venture capital in the State for
15-a certain purpose through the Fund; altering, for a certain fiscal year, the
16-distribution of certain General Fund surplus; and generally relating to investments
17-in private equity and venture capital in the State and the Maryland Technology
18-Development Corporation.
20+CHAPTER ______
1921
20-BY adding to
21- Article – Economic Development
22-Section 10–487 to be under the amended part “Part X. Miscellaneous Funds”
23- Annotated Code of Maryland
24- (2018 Replacement Volume and 2021 Supplement)
22+AN ACT concerning 1
2523
26-BY repealing and reenacting, without amendments,
27- Article – State Finance and Procurement
28-Section 7–311(a)(1) and (2)
29- Annotated Code of Maryland
30- (2021 Replacement Volume)
24+Maryland Technology Development Corporation – Maryland Equity Investment 2
25+Fund – Established 3
3126
32-BY repealing and reenacting, with amendments,
33- Article – State Finance and Procurement
34-Section 7–311(j)(1)(iii) and (iv)
35- Annotated Code of Maryland
36- (2021 Replacement Volume)
27+FOR the purpose of establishing the Maryland Equity Investment Fund in the Maryland 4
28+Technology Development Corporation; providing for the investment of certain 5
29+General Fund surplus in certain private equity and venture capital in the State for 6
30+a certain purpose through the Fund; altering, for a certain fiscal year, the 7
31+distribution of certain General Fund surplus; and generally relating to investments 8
32+in private equity and venture capital in the State and the Maryland Technology 9
33+Development Corporation. 10
3734
38-BY adding to
39- Article – State Finance and Procurement
40-Section 7–311(j)(1)(v)
41- Annotated Code of Maryland
42- (2021 Replacement Volume)
35+BY adding to 11
36+ Article – Economic Development 12
37+Section 10–487 to be under the amended part “Part X. Miscellaneous Funds” 13
38+ Annotated Code of Maryland 14
39+ (2018 Replacement Volume and 2021 Supplement) 15
4340
44- SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
45-That the Laws of Maryland read as follows:
41+BY repealing and reenacting, without amendments, 16
42+ Article – State Finance and Procurement 17
43+Section 7–311(a)(1) and (2) 18
44+ Annotated Code of Maryland 19
45+ (2021 Replacement Volume) 20
4646
47-Article – Economic Development
47+BY repealing and reenacting, with amendments, 21
48+ Article – State Finance and Procurement 22 2 SENATE BILL 885
4849
49-Part X. [Pre–Seed Builder Fund] MISCELLANEOUS FUNDS. Ch. 391 2022 LAWS OF MARYLAND
5050
51-– 2 –
51+Section 7–311(j)(1)(iii) and (iv) 1
52+ Annotated Code of Maryland 2
53+ (2021 Replacement Volume) 3
5254
53-10–487.
55+BY adding to 4
56+ Article – State Finance and Procurement 5
57+Section 7–311(j)(1)(v) 6
58+ Annotated Code of Maryland 7
59+ (2021 Replacement Volume) 8
5460
55- (A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS
56-INDICATED.
61+ SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 9
62+That the Laws of Maryland read as follows: 10
5763
58- (2) “FUND” MEANS THE MARYLAND EQUITY INVESTMENT FUND.
64+Article – Economic Development 11
5965
60- (3) “PRIVATE EQUITY ” MEANS AN ASSET CLASS CONSISTING OF
61-EQUITY SECURITIES AN D DEBT IN OPERATING COMPANIES THAT ARE N OT PUBLICLY
62-TRADED ON A STOCK EX CHANGE.
66+Part X. [Pre–Seed Builder Fund] MISCELLANEOUS FUNDS. 12
6367
64- (4) “QUALIFIED BUSINESS ” MEANS A BUSINESS THA T, AT THE TIME
65-OF THE FIRST INVESTM ENT IN THE BUSINESS :
68+10–487. 13
6669
67- (I) HAS ITS PRINCIPAL BU SINESS OPERATIONS LOCATED I N
68-THE STATE AND INTENDS TO MAINTAIN ITS PRINCIP AL BUSINESS OPERATIO NS IN
69-THE STATE AFTER RECEIVING AN INVESTMENT UNDER THE PROGRAM;
70+ (A) (1) IN THIS SECTION THE F OLLOWING WORDS HAVE THE MEANINGS 14
71+INDICATED. 15
7072
71- (II) HAS AGREED TO USE TH E QUALIFIED INVESTME NT
72-PRIMARILY TO:
73+ (2) “FUND” MEANS THE MARYLAND EQUITY INVESTMENT FUND. 16
7374
74- 1. SUPPORT BUSINESS OPE RATIONS IN THE STATE; OR
75+ (3) “PRIVATE EQUITY ” MEANS AN ASSET CLASS CONSISTING OF 17
76+EQUITY SECURITIES AN D DEBT IN OPERATING COMPANIES THAT ARE N OT PUBLICLY 18
77+TRADED ON A STOCK EX CHANGE. 19
7578
76- 2. IN THE CASE OF A STA RT–UP COMPANY , ESTABLISH
77-AND SUPPORT BUSINESS OPERATIONS IN THE STATE;
79+ (4) “QUALIFIED BUSINESS ” MEANS A BUSINESS THA T, AT THE TIME 20
80+OF THE FIRST INVESTM ENT IN THE BUSINESS : 21
7881
79- (III) HAS NOT MORE THAN 250 EMPLOYEES; AND
82+ (I) HAS ITS PRINCIPAL BUSINESS O PERATIONS LOCATED IN 22
83+THE STATE AND INTENDS TO MAINTAIN ITS PRINCIP AL BUSINESS OPERATIO NS IN 23
84+THE STATE AFTER RECEIVING AN INVESTMENT UNDER THE PROGRAM; 24
8085
81- (IV) IS NOT PRIMARILY ENG AGED IN:
86+ (II) HAS AGREED TO USE TH E QUALIFIED INVESTME NT 25
87+PRIMARILY TO: 26
8288
83- 1. RETAIL SALES;
89+ 1. SUPPORT BUS INESS OPERATIONS IN THE STATE; OR 27
8490
85- 2. REAL ESTATE DEVELOPM ENT;
91+ 2. IN THE CASE OF A STA RT–UP COMPANY , ESTABLISH 28
92+AND SUPPORT BUSINESS OPERATIONS IN THE STATE; 29
8693
87- 3. THE BUSINESS OF INSU RANCE, BANKING, OR
88-LENDING; OR
94+ (III) HAS NOT MORE THAN 250 EMPLOYEES; AND 30
95+ SENATE BILL 885 3
8996
90- 4. THE PROVISION OF PRO FESSIONAL SERVICES B Y
91-ACCOUNTANTS , ATTORNEYS, OR PHYSICIANS.
9297
93- (4) (5) “SEVERAL SYSTEMS ” HAS THE MEANING STAT ED IN §
94-20–201 OF THE STATE PERSONNEL AND PENSIONS ARTICLE.
95- LAWRENCE J. HOGAN, JR., Governor Ch. 391
98+ (IV) IS NOT PRIMARILY ENG AGED IN: 1
9699
97-– 3 –
98- (5) (6) “VENTURE CAPITAL ” MEANS AN INVESTMENT OF CAPITAL
99-TO A BUSINESS AT ANY STAGE OF ITS DEVELOP MENT BEFORE THE BUSI NESS MAKES
100-A PUBLIC OFFERING OF STOCK.
100+ 1. RETAIL SALES; 2
101101
102- (B) THERE IS A MARYLAND EQUITY INVESTMENT FUND IN THE
103-CORPORATION .
102+ 2. REAL ESTATE DEVELOPMENT ; 3
104103
105- (C) THE PURPOSE OF THE FUND IS TO ALLOW UNAP PROPRIATED GENERAL
106-FUND SURPLUS TO BE IN VESTED IN THE STATE A QUALIFIED BUSINESS WITH A GOAL
107-TO INCREASE PRIVATE EQUITY AND VENTURE C APITAL IN THE STATE, WITH THE
108-INTEREST EARNINGS AN D INVESTMENT RETURNS REALIZED FROM THOSE
109-INVESTMENTS TO THE BENEFIT OF TH E PARTICIPANTS OF TH E SEVERAL SYSTEMS .
104+ 3. THE BUSINESS OF INSU RANCE, BANKING, OR 4
105+LENDING; OR 5
110106
111- (D) THE CORPORATION SHALL MAN AGE AND SUPERVISE TH E FUND.
107+ 4. THE PROVISION OF PRO FESSIONAL SERVICES B Y 6
108+ACCOUNTANTS , ATTORNEYS, OR PHYSICIANS. 7
112109
113- (E) (1) THE FUND IS A SPECIAL, NONLAPSING REVOLVING FUND THAT IS
114-NOT SUBJECT TO REVER SION UNDER § 7–302 OF THE STATE FINANCE AND
115-PROCUREMENT ARTICLE.
110+ (4) (5) “SEVERAL SYSTEMS ” HAS THE MEANING STAT ED IN § 8
111+20–201 OF THE STATE PERSONNEL AND PENSIONS ARTICLE. 9
116112
117- (2) THE STATE TREASURER SHALL HOLD THE FUND, AND THE
118-COMPTROLLER SHALL ACC OUNT FOR THE FUND.
113+ (5) (6) “VENTURE CAPITAL ” MEANS AN INVESTMENT OF CAPITAL 10
114+TO A BUSINESS AT ANY STAGE OF ITS DEVELOP MENT BEFORE THE BUSI NESS MAKES 11
115+A PUBLIC OFFERING OF STOCK. 12
119116
120- (F) THE FUND CONSISTS OF :
117+ (B) THERE IS A MARYLAND EQUITY INVESTMENT FUND IN THE 13
118+CORPORATION . 14
121119
122- (1) MONEY DISTRIBUTED TO THE FUND UNDER § 7–311 OF THE STATE
123-FINANCE AND PROCUREMENT ARTICLE;
120+ (C) THE PURPOSE OF THE FUND IS TO ALLOW UNAP PROPRIATED GENERAL 15
121+FUND SURPLUS TO BE IN VESTED IN THE STATE A QUALIFIED BUSINESS WITH A GOAL 16
122+TO INCREASE PRIVATE EQUITY AND VENTURE C APITAL IN THE STATE, WITH THE 17
123+INTEREST EARNINGS AN D INVESTMENT RETURNS REALIZED FR OM THOSE 18
124+INVESTMENTS TO THE B ENEFIT OF THE PARTIC IPANTS OF THE SEVERA L SYSTEMS. 19
124125
125- (2) MONEY APPROPRIATED IN THE STATE BUDGET TO THE FUND; AND
126+ (D) THE CORPORATION SHALL MAN AGE AND SUPERVISE TH E FUND. 20
126127
127- (3) ANY OTHER MONEY FROM ANY OTHER SOURCE ACC EPTED FOR
128-THE BENEFIT OF THE FUND.
128+ (E) (1) THE FUND IS A SPECIAL, NONLAPSING REVOLVING FUND THAT IS 21
129+NOT SUBJECT TO REVER SION UNDER § 7–302 OF THE STATE FINANCE AND 22
130+PROCUREMENT ARTICLE. 23
129131
130- (G) THE FUND MAY BE USED ONLY :
132+ (2) THE STATE TREASURER SHALL HOLD THE FUND, AND THE 24
133+COMPTROLLER SHALL ACC OUNT FOR THE FUND. 25
131134
132- (1) FOR THE PURPOSES DES CRIBED IN SUBSECTION (C) OF THIS
133-SECTION; AND
135+ (F) THE FUND CONSISTS OF : 26
134136
135- (2) TO PAY THE COSTS NECESSARY TO A DMINISTER THE FUND.
137+ (1) MONEY DISTRIBUTED TO THE FUND UNDER § 7–311 OF THE STATE 27
138+FINANCE AND PROCUREMENT ARTICLE; 28
136139
137- (H) (1) THE STATE TREASURER SHALL INVES T MONEY IN THE FUND IN
138-THE SAME MANNER AS O THER STATE MONEY.
140+ (2) MONEY APPROPRIATED I N THE STATE BUDGET TO THE FUND; AND 29
141+ 4 SENATE BILL 885
139142
140- (2) (I) EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS
141-PARAGRAPH , ANY INVESTMENT EARNI NGS OF THE FUND AND INVE STMENT Ch. 391 2022 LAWS OF MARYLAND
142143
143-– 4 –
144-RETURNS REALIZED FRO M THE INVESTMENTS MA DE UNDER THIS SECTIO N SHALL
145-BE CREDITED TO THE A CCUMULATION FUNDS OF THE SEVERAL SYSTEMS
146-ESTABLISHED UNDER § 21–303 OF THE STATE PERSONNEL AND PENSIONS ARTICLE
147-AT THE DIRECTION OF THE BOARD OF TRUSTEES FOR THE STATE RETIREMENT AND
148-PENSION SYSTEM.
144+ (3) ANY OTHER MONEY FROM ANY OTHER SOURCE ACC EPTED FOR 1
145+THE BENEFIT OF THE FUND. 2
149146
150- (II) THE CORPORATION MAY RETAI N 50% OF INVESTMENT
151-RETURNS REALIZED FRO M THE INVESTMENTS MA DE UNDER THIS SECTIO N.
147+ (G) THE FUND MAY BE USED ONLY : 3
152148
153-Article – State Finance and Procurement
149+ (1) FOR THE PURPOSES DES CRIBED IN SUBSECTION (C) OF THIS 4
150+SECTION; AND 5
154151
155-7–311.
152+ (2) TO PAY THE COSTS NEC ESSARY TO ADMINISTER THE FUND. 6
156153
157- (a) (1) In this section the following words have the meanings indicated.
154+ (H) (1) THE STATE TREASURER SHALL INVES T MONEY IN THE FUND IN 7
155+THE SAME MANNER AS O THER STATE MONEY. 8
158156
159- (2) “Account” means the Revenue Stabilization Account.
157+ (2) (I) EXCEPT AS PROVIDED IN SUBPARAGRAPH (II) OF THIS 9
158+PARAGRAPH , ANY INVESTMENT EARNI NGS OF THE FUND AND INVESTMENT 10
159+RETURNS REALIZED FRO M THE INVESTMENTS MA DE UNDER THIS SECTIO N SHALL 11
160+BE CREDITED TO THE A CCUMULATION FUNDS OF THE SEVERAL SYSTEMS 12
161+ESTABLISHED UNDER § 21–303 OF THE STATE PERSONNEL AND PENSIONS ARTICLE 13
162+AT THE DIRECTION OF THE BOARD OF TRUSTEES FOR THE STATE RETIREMENT AND 14
163+PENSION SYSTEM. 15
160164
161- (j) (1) Except as provided in paragraph (2) of this subsection, for fiscal year
162-2007 and for each subsequent fiscal year, the Governor shall include in the budget bill an
163-appropriation:
165+ (II) THE CORPORATION MAY RETAI N 50% OF INVESTMENT 16
166+RETURNS REALIZED FRO M THE INVESTMENTS MA DE UNDER THIS SECTIO N. 17
164167
165- (iii) for fiscal year 2021, to the Account in the amount of
166-$291,439,149; [and]
168+Article – State Finance and Procurement 18
167169
168- (iv) EXCEPT AS PROVIDED I N ITEM (V) OF THIS PARAGRAPH , for
169-fiscal year 2022 and each fiscal year thereafter:
170+7–311. 19
170171
171- 1. to the accumulation funds of the State Retirement and
172-Pension System an amount, up to a maximum of $25,000,000, that is equal to one–quarter
173-of the amount by which the unappropriated General Fund surplus as of June 30 of the
174-second preceding fiscal year exceeds $10,000,000;
172+ (a) (1) In this section the following words have the meanings indicated. 20
175173
176- 2. to the Postretirement Health Benefits Trust Fund
177-established under § 34–101 of the State Personnel and Pensions Article an amount, up to
178-a maximum of $25,000,000, that is equal to one–quarter of the amount by which the
179-unappropriated General Fund surplus as of June 30 of the second preceding fiscal year
180-exceeds $10,000,000; and
174+ (2) “Account” means the Revenue Stabilization Account. 21
181175
182- 3. to the Account equal to the amount by which the
183-unappropriated General Fund surplus as of June 30 of the second preceding fiscal year
184-exceeds $10,000,000, less the amount of the appropriations under items 1 and 2 of this item;
185-AND
176+ (j) (1) Except as provided in paragraph (2) of this subsection, for fiscal year 22
177+2007 and for each subsequent fiscal year, the Governor shall include in the budget bill an 23
178+appropriation: 24
186179
187- (V) FOR FISCAL YEAR 2024:
188- LAWRENCE J. HOGAN, JR., Governor Ch. 391
180+ (iii) for fiscal year 2021, to the Account in the amount of 25
181+$291,439,149; [and] 26
189182
190-– 5 –
191- 1. TO THE MARYLAND EQUITY INVESTMENT FUND
192-ESTABLISHED UNDER § 10–487 OF THE ECONOMIC DEVELOPMENT ARTICLE AN
193-AMOUNT, UP TO $10,000,000, THAT IS EQUAL TO 10% OF THE AMOUNT BY WHI CH
194-THE UNAPPROPRIATED GENERAL FUND SURPLUS AS OF JUNE 30 OF THE SECOND
195-PRECEDING FISCAL YEA R EXCEEDS $10,000,000;
183+ (iv) EXCEPT AS PROVIDED I N ITEM (V) OF THIS PARAGR APH, for 27
184+fiscal year 2022 and each fiscal year thereafter: 28
196185
197- 2. TO THE ACCUMULATION FUNDS OF THE STATE
198-RETIREMENT AND PENSION SYSTEM AN AMOUNT , UP TO A MAXIMUM OF
199-$15,000,000, THAT IS EQUAL TO 15% OF THE AMOUNT BY WHI CH THE
200-UNAPPROPRIATED GENERAL FUND SURPLUS AS OF JUNE 30 OF THE SECOND
201-PRECEDING FISCAL YEA R EXCEEDS $10,000,000;
186+ 1. to the accumulation funds of the State Retirement and 29
187+Pension System an amount, up to a maximum of $25,000,000, that is equal to one–quarter 30 SENATE BILL 885 5
202188
203- 3. TO THE POSTRETIREMENT HEALTH BENEFITS TRUST
204-FUND ESTABLISHED UNDE R § 34–101 OF THE STATE PERSONNEL AND PENSIONS
205-ARTICLE AN AMOUNT , UP TO A MAXIMUM OF $25,000,000, THAT IS EQUAL TO 25%
206-OF THE AMOUNT BY WHI CH THE UNAPPROPRIATE D GENERAL FUND SURPLUS AS OF
207-JUNE 30 OF THE SECOND PRECED ING FISCAL YEAR EXCE EDS $10,000,000; AND
208189
209- 4. TO THE ACCOUNT EQUAL TO THE AMOUNT BY WHICH
210-THE UNAPPROPRIATED GENERAL FUND SURPLUS AS OF JUNE 30 OF THE SECOND
211-PRECEDING FISCAL YEA R EXCEEDS $10,000,000, LESS THE AMOUNT OF T HE
212-APPROPRIATIONS UNDER ITEMS 1 THROUGH 3 OF THIS ITEM.
190+of the amount by which the unappropriated General Fund surplus as of June 30 of the 1
191+second preceding fiscal year exceeds $10,000,000; 2
213192
214- SECTION 2. AND BE IT FURT HER ENACTED, That this Act shall take effect July
215-1, 2022.
193+ 2. to the Postretirement Health Benefits Trust Fund 3
194+established under § 34–101 of the State Personnel and Pensions Article an amount, up to 4
195+a maximum of $25,000,000, that is equal to one–quarter of the amount by which the 5
196+unappropriated General Fund surplus as of June 30 of the second preceding fiscal year 6
197+exceeds $10,000,000; and 7
216198
217-Approved by the Governor, May 16, 2022.
199+ 3. to the Account equal to the amount by which the 8
200+unappropriated General Fund surplus as of June 30 of the second preceding fiscal year 9
201+exceeds $10,000,000, less the amount of the appropriations under items 1 and 2 of this item; 10
202+AND 11
203+
204+ (V) FOR FISCAL YEAR 2024: 12
205+
206+ 1. TO THE MARYLAND EQUITY INVESTMENT FUND 13
207+ESTABLISHED UNDER § 10–487 OF THE ECONOMIC DEVELOPMENT ARTICLE AN 14
208+AMOUNT, UP TO $10,000,000, THAT IS EQUAL TO 10% OF THE AMOUNT BY WHI CH 15
209+THE UNAPPROPRIATED GENERAL FUND SURPLUS AS OF JUNE 30 OF THE SECOND 16
210+PRECEDING FISCAL YEA R EXCEEDS $10,000,000; 17
211+
212+ 2. TO THE ACCUMULATION FUNDS O F THE STATE 18
213+RETIREMENT AND PENSION SYSTEM AN AMOUNT , UP TO A MAXIMUM OF 19
214+$15,000,000, THAT IS EQUAL TO 15% OF THE AMOUNT BY WHI CH THE 20
215+UNAPPROPRIATED GENERAL FUND SURPLUS AS OF JUNE 30 OF THE SECOND 21
216+PRECEDING FISCAL YEA R EXCEEDS $10,000,000; 22
217+
218+ 3. TO THE POSTRETIREMENT HEALTH BENEFITS TRUST 23
219+FUND ESTABLISHED UNDE R § 34–101 OF THE STATE PERSONNEL AND PENSIONS 24
220+ARTICLE AN AMOUNT , UP TO A MAXIMUM OF $25,000,000, THAT IS EQUAL TO 25% 25
221+OF THE AMOUNT BY WHI CH THE UNAPPROPRIATE D GENERAL FUND SURPLUS AS OF 26
222+JUNE 30 OF THE SECOND PRECEDING FISCAL YEAR EXCEEDS $10,000,000; AND 27
223+
224+ 4. TO THE ACCOUNT EQUAL TO THE AMOUNT BY WHICH 28
225+THE UNAPPROPRIATED GENERAL FUND SURPLUS AS OF JUNE 30 OF THE SECOND 29
226+PRECEDING FISCAL YEA R EXCEEDS $10,000,000, LESS THE AMOUNT OF T HE 30
227+APPROPRIATIO NS UNDER ITEMS 1 THROUGH 3 OF THIS ITEM. 31
228+
229+ SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 32
230+1, 2022. 33
231+