EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*hb1290*
HOUSE BILL 1290
F2, P1 EMERGENCY BILL 3lr3034
CF SB 959
By: Delegate Forbes
Introduced and read first time: February 26, 2023
Assigned to: Rules and Executive Nominations
A BILL ENTITLED
AN ACT concerning 1
Higher Education – Maryland 529 Program – Reform 2
FOR the purpose of abolishing and repealing the Maryland 529 Board; specifying that the 3
State Treasurer is the successor to the Maryland 529 Board; transferring to the 4
Office of the State Treasurer the responsibility for administering the Maryland 529 5
Program, including the Maryland Prepaid College Trust, the Maryland College 6
Investment Plan, the Maryland Broker–Dealer College Investment Plan, and the 7
Maryland ABLE Program; authorizing the State Treasurer to take certain actions in 8
administering the Maryland 529 Program; requiring the State Treasurer to take 9
certain actions in administering the Maryland 529 Program; prohibiting the State 10
Treasurer from taking certain actions in administering the Maryland Prepaid 11
College Trust; establishing the Workgroup on the Maryland 529 Prepaid College 12
Trust Program; requiring the Workgroup to identify certain policies, procedures, and 13
practices and to develop recommendations relating to administering the Maryland 14
529 Program; providing for the transfer of certain services, appropriations, funding, 15
grants, property, records, fixtures, credits, assets, liabilities, obligations, rights, and 16
privileges to the Office of the State Treasurer; providing that employees transferred 17
to the Office of the State Treasurer as a result of this Act shall be transferred without 18
diminution of certain rights, benefits, or employment or retirement status; providing 19
for the continuity of certain transactions affected by or flowing from this Act; 20
providing for the continuity of certain laws, rules and regulations, standards and 21
guidelines, policies, orders, and other directives, permits and license applications, 22
forms, plans, memberships, contracts, agreements, property, investigations, and 23
administrative and judicial responsibilities; providing for the appropriate 24
transitional provisions relating to the continuity of certain boards and other units; 25
and generally relating to Maryland 529 Program reform. 26
BY repealing and reenacting, with amendments, 27
Article – Education 28
Section 18–1901, 18–1902.1, 18–1903 through 18–1905, 18–1905.1, 18–1906, 29
18–1906.1, 18–1907 through 18–1911, 18–1914, 18–1916, 18–19A–01 through 30 2 HOUSE BILL 1290
18–19A–03, 18–19A–04.1, 18–19A–05, 18–19A–05.1, 18–19A–07, 18–19B–01 1
through 18–19B–06, 18–19B–08, 18–19C–01 through 18–19C–03, 18–19C–05, 2
18–19C–06, 18–19C–08, and 18–19C–09 3
Annotated Code of Maryland 4
(2022 Replacement Volume) 5
BY repealing and reenacting, without amendments, 6
Article – Education 7
Section 18–1902, 18–1912, 18–1913, 18–1915, 18–19A–04, 18–19A–06, 8
18–19A–06.1, 18–19B–07, 18–19C–04, 18–19C–07, and 18–19C–10 9
Annotated Code of Maryland 10
(2022 Replacement Volume) 11
BY repealing and reenacting, with amendments, 12
Article – State Finance and Procurement 13
Section 11–203(f) 14
Annotated Code of Maryland 15
(2021 Replacement Volume and 2022 Supplement) 16
BY repealing and reenacting, with amendments, 17
Article – State Government 18
Section 9–803(a)(10) and (11) 19
Annotated Code of Maryland 20
(2021 Replacement Volume and 2022 Supplement) 21
BY adding to 22
Article – State Government 23
Section 9–803(a)(11) 24
Annotated Code of Maryland 25
(2021 Replacement Volume and 2022 Supplement) 26
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 27
That the Laws of Maryland read as follows: 28
Article – Education 29
18–1901. 30
(a) In this subtitle the following words have the meanings indicated. 31
(b) “ABLE account holder” means an individual who has established an account 32
described under § 529A(e) of the Internal Revenue Code and is the designated beneficiary 33
of the account. 34
(c) “Account holder” means an individual who: 35
HOUSE BILL 1290 3
(1) Makes or undertakes the obligation to make advance payments of 1
qualified higher education expenses as provided under a prepaid contract; and 2
(2) Except as provided in § 18–1909(b) of this subtitle, is a resident of 3
Maryland or of the District of Columbia at the time that the account holder enters into a 4
prepaid contract. 5
(d) [“Board” means the Maryland 529 Board. 6
(e)] “Broker–Dealer Plan” means the Maryland Broker –Dealer College 7
Investment Plan established under Subtitle 19B of this title. 8
[(f)] (E) “Current prepaid contract obligations” means the scheduled payments 9
due for the next fiscal year under existing prepaid contracts. 10
[(g)] (F) “Eligible institution of higher education” means an institution of higher 11
education that: 12
(1) Offers an associate, bachelor, or graduate degree program; and 13
(2) Is eligible to participate in federal financial aid programs. 14
[(h)] (G) “Market value of program assets” means the amount of cash and cash 15
equivalents held by the Trust plus the fair market value of other assets of the Trust. 16
[(i)] (H) “Maryland ABLE Program” means the Maryland Achieving a Better 17
Life Experience Program established under Subtitle 19C of this title. 18
[(j)] (I) “Plan” means the Maryland Senator Edward J. Kasemeyer College 19
Investment Plan established under Subtitle 19A of this title. 20
[(k)] (J) “Prepaid contract” means a contract between the [Board] STATE 21
TREASURER and an account holder under the provisions of this subtitle for the advance 22
payment of qualified higher education expenses by the account holder for a qualified 23
beneficiary to attend an eligible institution of higher education, if the qualified beneficiary 24
is admitted to the institution. 25
[(l)] (K) “Program” means Maryland 529. 26
[(m)] (L) “Qualified beneficiary” means an individual who: 27
(1) Is eligible to apply advance payments of qualified higher education 28
expenses to undergraduate or graduate qualified higher education expenses at an eligible 29
institution of higher education under the provisions of this subtitle; and 30
4 HOUSE BILL 1290
(2) Except as provided in § 18–1909(b) of this subtitle, is a resident of the 1
State or of the District of Columbia at the time that the account holder enters into a prepaid 2
contract. 3
[(n)] (M) “Qualified higher education expenses” has the meaning stated in § 529 4
of the Internal Revenue Code. 5
[(o)] (N) “Qualified state tuition program” has the meaning stated in § 529 of the 6
Internal Revenue Code. 7
[(p)] (O) “Trust” means the Maryland Senator Edward J. Kasemeyer Prepaid 8
College Trust established under this subtitle. 9
[(q)] (P) (1) “Tuition” means the actual tuition and mandatory fees assessed 10
to all students by an eligible institution of higher education as a condition of enrollment at 11
the institution. 12
(2) “Tuition” does not include any fee that is assessed by the institution for 13
a particular course taken, year of enrollment, academic status, course of study, residency 14
status, or any other distinguishing factor used by the institution to determine a specific fee. 15
18–1902. 16
It is the intent of the General Assembly to enhance the accessibility and affordability 17
of higher education for all citizens of the State and for all citizens of the District of Columbia 18
by establishing a method to provide for the prepayment of tuition at eligible institutions of 19
higher education. 20
18–1902.1. 21
(a) There is a Program entitled Maryland 529. 22
(b) The purpose of the Program is to provide for the administration by the [Board] 23
STATE TREASURER of the Maryland Senator Edward J. Kasemeyer Prepaid College 24
Trust, the Maryland Senator Edward J. Kasemeyer College Investment Plan, the Maryland 25
Broker–Dealer College Investment Plan, and the Maryland ABLE Program. 26
18–1903. 27
(a) There is a Maryland Senator Edward J. Kasemeyer Prepaid College Trust. 28
(b) The purpose of the Trust is to provide: 29
(1) A means for payment of the cost of tuition in advance of enrollment at 30
an eligible institution of higher education; and 31
HOUSE BILL 1290 5
(2) An assurance to a beneficiary who enrolls at an eligible institution of 1
higher education that the [Board] STATE TREASURER shall make every effort to invest 2
the advance payments so that the prepaid contract will cover the average in–State tuition 3
costs at public institutions of higher education in the State at the time that the benefits are 4
exercised. 5
(c) The [Board] STATE TREASURER shall administer the Trust in compliance 6
with Internal Revenue Service standards for qualified State tuition programs. 7
(d) The funds of the Trust consist of: 8
(1) Payments received from prepaid contracts made under the provisions 9
of this subtitle; 10
(2) Bequests, endowments, or funds from any other available private 11
source; 12
(3) Interest and income earned from the investments of the Trust; and 13
(4) Federal, State, or local funds, or funds from any other available public 14
source. 15
(e) Money remaining in the Trust at the end of the fiscal year shall remain in the 16
Trust and may not revert to the General Fund of the State. 17
(f) Money of the Trust may not be considered money of the State and may not be 18
deposited into the Treasury. 19
(g) Money of the Trust may not be considered money of the Maryland Senator 20
Edward J. Kasemeyer College Investment Plan and may not be commingled with the Plan. 21
(h) Money of the Trust may not be considered money of or be commingled with 22
the Maryland Broker–Dealer College Investment Plan. 23
(i) Money of the Trust may not be considered money of or be commingled with 24
the Maryland ABLE Program. 25
(j) (1) The debts, contracts, and obligations of the Trust are not the contracts, 26
debts, or obligations of the State and neither the faith and credit nor taxing power of the 27
State is pledged directly or indirectly or contingently, morally or otherwise, to the payment 28
of the debts, contracts, and obligations. 29
(2) The [Board] STATE TREASURER cannot directly or indirectly or 30
contingently obligate, morally or otherwise, the State to levy or pledge any form of taxation 31
whatsoever for the debts and obligations of the Trust or to make any appropriation for the 32
payment of the debts and obligations of the Trust. 33
6 HOUSE BILL 1290
(k) Neither the State nor any eligible institution of higher education shall be 1
liable for any losses or shortage of funds in the event that the Maryland Senator Edward 2
J. Kasemeyer Prepaid College Trust is insufficient to meet the tuition requirements of an 3
institution attended by the qualified beneficiary. 4
18–1904. 5
[(a) There is a Maryland 529 Board. 6
(b)] The [Board] STATE TREASURER shall administer: 7
(1) The Maryland Senator Edward J. Kasemeyer Prepaid College Trust 8
established under this subtitle; 9
(2) The Maryland Senator Edward J. Kasemeyer College Investment Plan 10
established under Subtitle 19A of this title; 11
(3) The Maryland Broker–Dealer College Investment Plan established 12
under Subtitle 19B of this title; and 13
(4) The Maryland ABLE Program established under Subtitle 19C of this 14
title. 15
[(c) The Board consists of the following members: 16
(1) The Secretary of the Maryland Higher Education Commission; 17
(2) The State Superintendent of Schools; 18
(3) The State Treasurer; 19
(4) The State Comptroller; 20
(5) The Chancellor of the University System of Maryland; 21
(6) The Secretary of Disabilities; and 22
(7) Five members of the public who shall be appointed by the Governor and 23
shall have significant experience in finance, accounting, investment management, or other 24
areas that can be of assistance to the Board. 25
(d) A member of the Board designated under subsection (c)(1) through (6) of this 26
section may designate an employee from the member’s staff to represent the member of the 27
Board, with the full voting rights, powers, and duties of the member. 28
(e) Before taking office, each appointee to the Board shall take the oath required 29
by Article I, § 9 of the Maryland Constitution. 30 HOUSE BILL 1290 7
(f) (1) Except for the terms of the initial members of the Board, the term of a 1
public member of the Board is 4 years. 2
(2) The terms of the public members of the Board are staggered as required 3
by the terms of the members of the Board on October 1, 1998. 4
(3) At the end of a term, a public member continues to serve until a 5
successor is appointed and qualifies. 6
(4) A public member who is appointed after a term has begun serves only 7
for the remainder of the term and until a successor is appointed and qualifies. 8
(5) A public member is eligible for reappointment. 9
(g) The Governor may remove a public member for incompetence or misconduct.] 10
18–1905. 11
(a) [The Board, from among the members of the Board, shall elect a chairman 12
and may elect additional officers that the Board considers necessary. 13
(b) The Board shall determine the times and places of meetings. 14
(c) A member of the Board: 15
(1) May not receive compensation; 16
(2) Is entitled to reimbursement for expenses under the Standard State 17
Travel Regulations; and 18
(3) Shall file a public disclosure of financial interests as required under the 19
Maryland Public Ethics Law. 20
(d)] (1) The [Board] STATE TREASURER: 21
(i) Shall appoint a Program executive director who is in the 22
executive service of the State Personnel Management System; and 23
(ii) May employ additional PROGRAM staff in accordance with the 24
budget. 25
(2) (i) Except for employees described in subparagraph (ii) or (iii) of this 26
paragraph, the employees shall be skilled service employees subject to the provisions of the 27
State Personnel and Pensions Article that govern skilled service employees. 28
8 HOUSE BILL 1290
(ii) An employee is in the professional service and subject to the 1
provisions of the State Personnel and Pensions Article that govern professional service 2
employees if the position: 3
1. Requires knowledge of an advanced type in a field of 4
science or learning customarily acquired by a course of specialized intellectual instruction 5
and study; and 6
2. Normally requires a professional license, an advanced 7
degree, or both. 8
(iii) An employee is in the management service and subject to the 9
provisions of the State Personnel and Pensions Article that govern management service 10
employees if the position: 11
1. Primarily involves direct responsibility for the oversight 12
and management of personnel and financial resources; 13
2. Requires the exercise of discretion and independent 14
judgment; and 15
3. Is not in the executive service. 16
(3) The [Board] STATE TREASURER may retain the services of 17
consultants, administrators, and other personnel, as necessary, to administer the Trust, 18
the Plan, the Broker–Dealer Plan, or the Maryland ABLE Program. 19
(4) The budget for the Program[, the Board,] and [its] staff [is] RETAINED 20
BY THE STATE TREASURER TO ADMINIST ER THE PROGRAM ARE subject to review by 21
the General Assembly for information purposes only. 22
[(e)] (B) The [Board] STATE TREASURER may adopt any regulations that the 23
[Board] STATE TREASURER considers necessary to carry out the provisions of this subtitle 24
or Subtitle 19A, Subtitle 19B, or Subtitle 19C of this title. 25
[(f)] (C) In [addition] ADMINISTERING THE PROGRAM, the [Board] STATE 26
TREASURER may: 27
(1) [Adopt an official seal] ADMINISTER OATHS , TAKE TESTIMONY , AND 28
SUBPOENA WITNESSES A ND BOOKS, RECORDS, AND OTHER DOCUMEN TS; 29
(2) Sue and be sued FOR CAUSES OF ACTION RELATED TO THE 30
ADMINISTRATION OF TH E PROGRAM; 31
(3) Execute contracts and other necessary instruments; 32
HOUSE BILL 1290 9
(4) Hold, buy, and sell instruments, obligations, securities, and other 1
investments consistent with its comprehensive investment plan; 2
(5) Enter into agreements with eligible institutions of higher education and 3
other public or private entities for the promotion, administration, or marketing of the 4
Program, the Trust, the Plan, the Broker–Dealer Plan, or the Maryland ABLE Program; 5
(6) Invest funds not required for immediate disbursement; 6
(7) Solicit and accept gifts, grants, loans, or other aid from any source or 7
participate in any government program for purposes consistent with this subtitle and 8
Subtitles 19A, 19B, and 19C of this title; 9
(8) Subject to the review of the General Assembly, impose, collect, and 10
distribute across Maryland 529 programs reasonable administrative fees for any 11
transactions under the Trust, the Plan, the Broker–Dealer Plan, or the Maryland ABLE 12
Program or involving prepaid contracts or transactions affecting the Program, the Trust, 13
the Plan, the Broker–Dealer Plan, or the Maryland ABLE Program; 14
(9) Procure insurance against any loss of assets of the Program, the Trust, 15
the Plan, the Broker–Dealer Plan, or the Maryland ABLE Program; 16
(10) Endorse insurance coverage written exclusively for the purpose of 17
protecting: 18
(i) A prepaid contract under the Trust and the account holder and 19
the qualified beneficiary of the contract; 20
(ii) An investment account under the Plan, or the Broker–Dealer 21
Plan, and the account holder and qualified designated beneficiary of the investment 22
account; or 23
(iii) An ABLE account under the Maryland ABLE Program and the 24
ABLE account holder; 25
(11) Designate terms under which money may be withdrawn from the 26
Program, the Trust, the Plan, the Broker–Dealer Plan, or the Maryland ABLE Program; 27
(12) Establish additional procedural and substantive requirements for 28
participation in and the administration or marketing of the Program, the Trust, the Plan, 29
the Broker–Dealer Plan, or the Maryland ABLE Program; 30
(13) Appear on the [Board’s] STATE TREASURER’S own behalf before 31
[other] boards, commissions, or other governmental agencies; and 32
10 HOUSE BILL 1290
(14) Take any other action that the [Board] STATE TREASURER considers 1
appropriate to implement and administer the Program, the Trust, the Plan, the 2
Broker–Dealer Plan, or the Maryland ABLE Program. 3
18–1905.1. 4
(a) (1) The [Board] STATE TREASURER shall develop and implement a 5
marketing plan to increase participation in Maryland 529. 6
(2) (i) The marketing plan shall identify methods to increase general 7
participation in Maryland 529. 8
(ii) The [Board] STATE TREASURER shall coordinate with the 9
Board of Trustees of the Maryland Teachers and State Employees Supplemental 10
Retirement Plans and local school systems, respectively, to identify methods to increase 11
participation in Maryland 529 among: 12
1. State employees that participate in other State tax 13
savings programs; and 14
2. Families of students in local school systems with lower 15
rates of participation in Maryland 529 than the State population. 16
(b) On or before December 1, 2016, and every 3 years thereafter, the [Board] 17
STATE TREASURER shall submit the marketing plan required under subsection (a) of this 18
section to the Governor and, in accordance with § 2–1257 of the State Government Article, 19
the Senate Budget and Taxation Committee, the Senate [Education, Health, and 20
Environmental Affairs] Committee ON EDUCATION, ENERGY, AND THE 21
ENVIRONMENT , the House Committee on Ways and Means, and the House Appropriations 22
Committee. 23
18–1906. 24
(a) The [Board] STATE TREASURER shall adopt a comprehensive investment 25
plan for the administration of the Trust. 26
(b) The plan shall specify the investment policies used by the [Board] STATE 27
TREASURER in the administration of the Trust. 28
(c) Assets of the Trust shall be invested in accordance with the comprehensive 29
investment plan. 30
(d) The comprehensive investment plan must indicate the percentage of assets 31
that shall be held in each class of investment, the amount of funds held in any cash pool, 32
the amount of funds held in fixed assets investments, the amount of funds held in equity 33
investments, and the percentage and dollar value of assets placed with outside managers. 34 HOUSE BILL 1290 11
(e) (1) Notwithstanding any law restricting the deposit or investment of State 1
money, the [Board] STATE TREASURER may place assets of the Trust in savings accounts 2
or may use the assets to purchase fixed or variable life insurance or annuity contracts, 3
securities, evidence of indebtedness, or other investment products pursuant to the 4
comprehensive investment plan. 5
(2) Any insurance, annuity contracts, savings, or other investment 6
products procured by the [Board] STATE TREASURER shall be underwritten and offered 7
in compliance with applicable federal and State laws. 8
(f) The [Board] STATE TREASURER shall make every effort to invest the assets 9
of the Trust in a manner that earns, at a minimum, sufficient earnings to generate the 10
difference between the prepaid amount under prepaid contracts and the average in–State 11
tuition costs at public institutions of higher education in the State at the time that the 12
benefits are exercised. 13
(g) The comprehensive investment plan shall provide for the Trust to be 14
administered in an actuarially sound manner to assure that the [Board] STATE 15
TREASURER may defray obligations of the Trust. 16
(h) The [Board] STATE TREASURER shall review the comprehensive investment 17
plan at least annually to assure that the Trust remains actuarially sound. 18
(i) The [Board] STATE TREASURER may contract with an investment advisory 19
or management company for the investment and management of the Trust as long as the 20
Trust is administered in accordance with the comprehensive investment plan. 21
(j) The [Board] STATE TREASURER: 22
(1) Shall preserve, invest, and expend the assets of the Trust solely for the 23
purposes of this subtitle; and 24
(2) May not loan, transfer, or use the assets for any other purpose of the 25
State. 26
(k) The Trust is not subject to § 7–302 of the State Finance and Procurement 27
Article. 28
(l) Unless the [Board] STATE TREASURER provides otherwise by regulation, 29
the [Board] STATE TREASURER shall use the proceeds in the Trust in the following order: 30
(1) To pay eligible institutions of higher education in accordance with the 31
[Board’s] STATE TREASURER’S obligations under prepaid contracts; 32
(2) To refund money on the termination of prepaid contracts; and 33 12 HOUSE BILL 1290
(3) To pay the operating expenses of the [Board] STATE TREASURER IN 1
ADMINISTERING THE PROGRAM. 2
(m) (1) Except as provided in paragraph (2) of this subsection, if the [Board] 3
STATE TREASURER determines after an annual review that the market value of Trust 4
assets exceeds the amount necessary to satisfy all scheduled payments currently due or 5
scheduled to become due under all prepaid contracts by 30% or more, the [Board] STATE 6
TREASURER may provide for a rebate from the excess to account holders of existing 7
prepaid contracts in an amount to be determined by the [Board] STATE TREASURER. 8
(2) The [Board] STATE TREASURER may not rebate any amount to 9
account holders if, within the 5 years immediately preceding the proposed rebate: 10
(i) The [Board] STATE TREASURER has requested an 11
appropriation under § 18–1906.1 of this subtitle; or 12
(ii) The Trust has failed to repay to the State any appropriation 13
under § 18–1906.1 of this subtitle. 14
18–1906.1. 15
(a) If the current prepaid contract obligations of the Trust exceed the market 16
value of Trust assets, at the request of the [Board] STATE TREASURER, the Governor 17
shall include in the annual budget bill submitted to the General Assembly an appropriation 18
in the amount determined under subsection (b) of this section. 19
(b) The appropriation to be included in the budget bill under subsection (a) of this 20
section shall equal the difference between the current prepaid contract obligations and the 21
market value of Trust assets. 22
(c) For purposes of this section, the current prepaid contract obligations and the 23
market value of Trust assets: 24
(1) Shall be determined as of June 30 of the calendar year that ended before 25
the beginning of the fiscal year for which the appropriation is requested; and 26
(2) Shall be verified by the report of the independent outside auditor 27
required under § 18–1916 of this subtitle. 28
(d) (1) The amount appropriated under this section shall be deposited into the 29
Trust. 30
(2) All amounts paid into the Trust under this section shall constitute and 31
be accounted for as advances to the Trust. 32
HOUSE BILL 1290 13
(3) Subject to the rights of the Trust’s contract holders, amounts 1
appropriated under this section shall be repaid to the State without interest in equal 2
amounts in each of the next 2 fiscal years succeeding the one for which the appropriation 3
was made. 4
(4) If the appropriation in the State budget as enacted by the General 5
Assembly is less than the amount specified under subsection (b) of this section, the [Board] 6
STATE TREASURER may adjust the terms of subsequent or current prepaid contracts to 7
ensure continued actuarial soundness of the Trust. 8
18–1907. 9
(a) In this section, “fiduciary” means: 10
(1) [A member of the Board] THE STATE TREASURER; or 11
(2) An employee of the Program or the Trust who exercises any 12
discretionary authority or control over: 13
(i) The management or administration of the Trust; or 14
(ii) The management or disposition of the assets of the Trust. 15
(b) A fiduciary shall discharge the fiduciary’s duties with respect to the Trust: 16
(1) Solely in the interest of the participants; 17
(2) For the exclusive purposes of providing benefits to the participants and 18
providing reasonable expenses of administering the Trust; 19
(3) With the care, skill, prudence, and diligence under the circumstances 20
then prevailing, that a prudent person acting in a like capacity and familiar with such 21
matters would use in the conduct of an enterprise of a like character with like aims; 22
(4) By diversifying the investments of the Trust so as to minimize the risk 23
of large losses, unless under the circumstances it is clearly prudent not to do so; 24
(5) In accordance with the laws governing the Trust; and 25
(6) In accordance with the documents and instruments governing the Trust 26
to the extent that the documents and instruments are consistent with this subtitle. 27
(c) In exercising authority, control, or discretion with respect to the Trust, a 28
fiduciary may not: 29
(1) Use the assets of the Trust for the fiduciary’s own interest or account; 30
14 HOUSE BILL 1290
(2) Act in a transaction involving the Trust on behalf of a person, or 1
represent a person, if the interests of the person are adverse to the interests of the Trust or 2
the interests of participants; 3
(3) Receive any consideration for the fiduciary’s own account from a person 4
dealing with the Trust in connection with a transaction involving the assets of the Trust; 5
or 6
(4) Become an endorser or surety or, in any manner, an obligor, for money 7
lent to or borrowed from the [Board] STATE TREASURER. 8
18–1908. 9
(a) The [Board] STATE TREASURER shall purchase a bond for each fiduciary in 10
accordance with Title 9, Subtitle 17 of the State Government Article. 11
(b) Unless a fiduciary is bonded, the fiduciary may not exercise custody or control 12
of any assets of the Trust. 13
(c) A fiduciary may not allow another fiduciary to act in violation of this section. 14
18–1909. 15
(a) (1) [The Board shall] ON OR AFTER JUNE 1, 2023, THE STATE 16
TREASURER MAY NOT establish prepaid contracts under the Trust to provide for the 17
advance payment of tuition at: 18
[(1)] (I) A community college; 19
[(2)] (II) A 4–year college; 20
[(3)] (III) A university; or 21
[(4)] (IV) Any combination of a community college, college, or university. 22
(2) ON OR AFTER JUNE 1, 2023, AN ACCOUNT HOLDER MA Y NOT 23
ENTER INTO PREPAID CONTRACTS UN DER THE TRUST TO PROVIDE FOR THE 24
ADVANCE PAYMENT OF T UITION AT: 25
(I) A COMMUNITY COLLEGE ; 26
(II) A 4–YEAR COLLEGE ; 27
(III) A UNIVERSITY; OR 28
HOUSE BILL 1290 15
(IV) ANY COMBINATION OF A COMMUNITY COLLEGE , COLLEGE, 1
OR UNIVERSITY. 2
(b) (1) For the purpose of entering into a prepaid contract, either the account 3
holder or the qualified beneficiary must be a resident of Maryland or of the District of 4
Columbia at the time that the account holder enters into the prepaid contract. 5
(2) For the purposes of determining residency for the purchase of a prepaid 6
contract: 7
(i) For residency in Maryland, “resident” has the meaning stated in 8
§ 10–101 of the Tax – General Article; and 9
(ii) For residency in the District of Columbia, “resident” has the 10
meaning stated in § 47–1801.04 of the District of Columbia Code Annotated. 11
(c) The cost of a prepaid contract shall be based on: 12
(1) The average current in–State tuition costs at the time the prepaid 13
contract is purchased at public institutions of higher education in the State; 14
(2) The number of years expected to elapse between the purchase of a 15
prepaid contract and the use of the benefits of the prepaid contract; and 16
(3) The projected tuition costs at the time that the benefits will be 17
exercised. 18
(d) Each prepaid contract made under the provisions of this subtitle shall include 19
the following provisions: 20
(1) The amount of each payment and the number of payments required 21
from an account holder; 22
(2) The terms and conditions under which account holders shall remit 23
payments, including the dates of the payments; 24
(3) Provisions for late payment charges and defaults; 25
(4) Penalties for early withdrawal from the Trust; 26
(5) The amount and terms of any administrative fees that must be paid by 27
the account holder or the beneficiary; 28
(6) The name and date of birth of the qualified beneficiary on whose behalf 29
the contract is made; 30
16 HOUSE BILL 1290
(7) Terms and conditions for a substitution for the qualified beneficiary 1
originally named; 2
(8) Terms and conditions for the termination of the prepaid contract; 3
(9) The time period during which the qualified beneficiary may claim 4
benefits from the Trust; 5
(10) The maximum number of undergraduate semester hours that are 6
prepaid under the prepaid contract, based on in–State tuition at a public institution of 7
higher education in the State; 8
(11) All other rights and obligations of the account holder and the Trust; and 9
(12) Any other terms and conditions that the [Board] STATE TREASURER 10
considers necessary or appropriate. 11
(e) The [Board] STATE TREASURER shall allow the conversion of a prepaid 12
contract from one tuition plan or payment option to a different tuition plan or payment 13
option. 14
(f) The [Board] STATE TREASURER shall allow excess prepaid contract benefits 15
due to receipt of a scholarship, tuition remission, or early graduation from college to be used 16
toward the payment of other qualified higher education expenses, as specified by the 17
[Board] STATE TREASURER, at an eligible institution of higher education. 18
(g) (1) ON OR AFTER JUNE 1, 2023, THE STATE TREASURER MAY NOT 19
ALLOW THE TRANSFER O F FUNDS FROM ANY OTH ER QUALIFIED STATE TUITION 20
PROGRAM TO THE TRUST, IN ACCORDANCE WITH F EDERAL LAW. 21
(2) (I) [The Board] ON OR BEFORE DECEMBER 31, 2024, THE 22
STATE TREASURER shall allow the transfer of funds from the Trust to any other qualified 23
State tuition program [or from any other qualified State tuition program to the Trust], in 24
accordance with federal law. 25
(II) SUBJECT TO SUBPARAGRA PH (III) OF THIS PARAGRAPH , 26
THE STATE TREASURER SHALL GRANT AN INTEREST PAYMENT TO AN ACCOUNT 27
HOLDER WHO , IN ACCORDANCE WITH S UBPARAGRAPH (I) OF THIS PARAGRAPH , 28
TRANSFERS FUNDS FROM THE TRUST TO THE PLAN. 29
(III) THE STATE TREASURER SHALL ADOPT REGULATIONS TO 30
DETERMINE THE INTERE ST RATE FOR PAYMENTS REQUIRE D UNDER 31
SUBPARAGRAPH (II) OF THIS PARAGRAPH . 32
HOUSE BILL 1290 17
(3) ON OR AFTER JANUARY 1, 2025, THE STATE TREASURER MAY NOT 1
ALLOW THE TRANSFER O F FUNDS FROM THE TRUST TO ANY OTHER QU ALIFIED 2
STATE TUITION PROGRAM, IN ACCORDANCE WITH F EDERAL LAW. 3
(h) The [Board] STATE TREASURER shall allow the transfer of funds from the 4
Trust to any qualified ABLE program established in accordance with § 529A of the Internal 5
Revenue Code. 6
(i) The [Board] STATE TREASURER shall set procedures to ensure that 7
contributions to the Trust plus contributions or payments to other qualified State tuition 8
programs do not exceed a total maximum amount determined by § 529 of the Internal 9
Revenue Code for contributions to multiple qualified State tuition programs. 10
(j) The Maryland prepaid contract plan shall be referred to as the Senator 11
Edward J. Kasemeyer prepaid contract plan. 12
18–1910. 13
(a) (1) The [Board] STATE TREASURER shall issue refunds as specified in 14
this section. 15
(2) Unless authorized by the [Board] STATE TREASURER or under 16
subsection (b) of this section, a refund may not exceed the amount paid into the Trust by 17
the account holder. 18
(b) A refund equal to the same benefits as provided by the prepaid contract, minus 19
any amount paid out of the funds of the Trust on behalf of the qualified beneficiary and for 20
reasonable administrative charges, shall be made if the beneficiary: 21
(1) Is awarded a scholarship or tuition remission that covers benefits 22
provided under the prepaid contract; or 23
(2) Dies or suffers from a disability which prevents the beneficiary from 24
attending an institution of higher education within the time allowed by this subtitle. 25
(c) (1) A reduced refund of the contributions made to the Trust, as determined 26
by the [Board] STATE TREASURER, shall be made if: 27
(i) The beneficiary does not attend an institution of higher 28
education; 29
(ii) Benefits are not exercised under the contract within a time 30
specified in the contract; or 31
(iii) The prepaid contract is canceled by the account holder. 32
18 HOUSE BILL 1290
(2) The time that a qualified beneficiary spends in active duty as a member 1
of the United States armed forces shall be added to the time period allowed to exercise the 2
benefits under a prepaid contract before a termination under paragraph (1) of this 3
subsection. 4
18–1911. 5
The [Board] PROGRAM, Trust, and prepaid contracts issued under this subtitle are 6
not subject to the provisions of the Insurance Article. 7
18–1912. 8
The assets and income of the Trust are exempt from State and local taxation. 9
18–1913. 10
(a) In this section, “person” does not include the State. 11
(b) A person may not attach, execute, garnish, or otherwise seize any current or 12
future benefit under a prepaid contract or any asset of the Trust. 13
18–1914. 14
(a) Nothing in this subtitle or in any prepaid contract may be construed as a 15
promise or guarantee by the [Board] STATE TREASURER of admission to, continued 16
enrollment at, or graduation from an institution of higher education. 17
(b) The actual tuition rate charged to a qualified beneficiary shall be determined 18
at the time of enrollment in accordance with the residency policy adopted by the governing 19
board of the institution of higher education at which the qualified beneficiary enrolls. 20
18–1915. 21
The State and its agencies or any local government in the State may agree, by 22
contract or otherwise, to remit payments on behalf of an employee toward a prepaid 23
contract through payroll deductions. 24
18–1916. 25
(a) (1) The Legislative Auditor shall audit the Trust as provided under Title 2, 26
Subtitle 12 of the State Government Article. 27
(2) The [Board] STATE TREASURER shall cause an audit of the Trust to 28
be made by an outside independent auditor annually. 29
(3) The [Board] STATE TREASURER shall pay for the audit required 30
under paragraph (2) of this subsection. 31 HOUSE BILL 1290 19
(b) (1) Within 120 days after the close of each fiscal year, the [Board] STATE 1
TREASURER shall submit to the Governor and, subject to § 2–1257 of the State 2
Government Article, to the General Assembly a report including: 3
(i) The audit of the outside independent auditor; 4
(ii) A financial accounting of the Trust, including: 5
1. The annual review of the comprehensive investment plan 6
which shall include: 7
A. The status of the investment program, including 8
investment income matched to projected enrollment costs under the existing prepaid 9
contracts; 10
B. The assets held in each class of investment, the amount of 11
funds held in any cash pool, the amount of funds held in fixed assets investments, and the 12
amount of funds held in equity investments; 13
C. The percentage and dollar value of assets placed with 14
outside managers; 15
D. The income produced by each class of investment; and 16
E. The income produced by each investment manager; and 17
2. A detailed account of the operating and administrative 18
budget for the Trust, which shall include a complete list of revenue sources and 19
expenditures detailing the line item expenditures for: 20
A. Salaries, wages, and fringe benefits; 21
B. Technical and special fees; 22
C. Communication; 23
D. Travel; 24
E. Contractual services; 25
F. Supplies and materials; 26
G. Equipment; 27
H. Fixed charges; and 28
20 HOUSE BILL 1290
I. Other expenses; 1
(iii) The number of prepaid contracts entered into during the 2
previous fiscal year; 3
(iv) Efforts by the [Board] STATE TREASURER in marketing the 4
prepaid contracts under the Trust; and 5
(v) Any recommendations of the [Board] STATE TREASURER 6
concerning the operation of the Trust. 7
(2) The [Board] STATE TREASURER shall make available to each account 8
holder a copy of a summary of the report and the option to purchase the full report at a 9
nominal charge. 10
(c) The audit required by subsection (a)(2) of this section and the report required 11
by subsection (b) of this section may be combined with any other audit or report for the 12
same fiscal year required to be submitted by the [Board] STATE TREASURER to the 13
Governor and the General Assembly. 14
18–19A–01. 15
(a) In this subtitle the following words have the meanings indicated. 16
(b) “Account holder” means the person who established an investment account on 17
behalf of a qualified designated beneficiary. 18
(c) [“Board” means the Maryland 529 Board established under § 18–1904 of this 19
title. 20
(d)] “Eligible educational institution” has the meaning stated in § 529(e) of the 21
Internal Revenue Code. 22
[(e)] (D) “Investment account” means an account established by an account 23
holder under this subtitle on behalf of a qualified designated beneficiary for the purpose of 24
applying distributions toward qualified higher education expenses at eligible educational 25
institutions. 26
[(f)] (E) “Plan” means the Maryland Senator Edward J. Kasemeyer College 27
Investment Plan established under this subtitle. 28
[(g)] (F) “Qualified designated beneficiary” has the meaning stated in § 529 of 29
the Internal Revenue Code. 30
[(h)] (G) “Qualified higher education expenses” has the meaning stated in § 529 31
of the Internal Revenue Code. 32 HOUSE BILL 1290 21
[(i)] (H) “Qualified state tuition program” has the meaning stated in § 529 of the 1
Internal Revenue Code. 2
18–19A–02. 3
(a) There is a Maryland Senator Edward J. Kasemeyer College Investment Plan. 4
(b) The purpose of the Plan is to allow contributions to an investment account 5
established for the purposes of meeting the qualified higher education expenses of the 6
qualified designated beneficiary of the account. 7
(c) (1) The [Board] STATE TREASURER shall administer, manage, promote, 8
and market the Plan. 9
(2) The [Board] STATE TREASURER shall administer the Plan in 10
compliance with Internal Revenue Service standards for qualified State tuition programs. 11
(d) The [Board] STATE TREASURER shall adopt procedures that the [Board] 12
STATE TREASURER considers necessary to carry out the provisions of this subtitle. 13
(e) The [Board] STATE TREASURER shall adopt procedures relating to: 14
(1) Application procedures for participation in the Plan; 15
(2) Start–up costs incurred by the State for the development of the Plan 16
with these costs to be reimbursed to the State by the Plan; 17
(3) Early withdrawals, so that there will be no major detriment to the 18
remaining account holders in the Plan; 19
(4) The State contribution program; 20
(5) Transfer of funds from the Plan to other qualified State tuition 21
programs and from other qualified State tuition programs to the Plan in accordance with 22
federal law; and 23
(6) Transfer of funds from the Plan to a qualified ABLE program 24
established in accordance with § 529A of the Internal Revenue Code. 25
(f) At least annually, the [Board] STATE TREASURER shall issue to each 26
account holder a statement that provides a separate accounting for each qualified 27
designated beneficiary providing the following information with respect to each account: 28
(1) The beginning balance; 29
22 HOUSE BILL 1290
(2) Contributions to the account, including any State contribution; 1
(3) Withdrawals from the account during the previous year; and 2
(4) Ending investment account value. 3
18–19A–03. 4
(a) (1) The [Board] STATE TREASURER may issue requests for proposals to 5
evaluate and determine the means for the administration, management, promotion, or 6
marketing of the Plan. 7
(2) The [Board] STATE TREASURER shall consider proposals that meet 8
the following criteria: 9
(i) Ability to develop and administer an investment program of a 10
nature similar to the objectives of the Plan; 11
(ii) Ability to administer financial programs with individual account 12
records and reporting; 13
(iii) Ability to market the Plan to Maryland residents; 14
(iv) Ability to market the Plan to nonresidents of Maryland; and 15
(v) Ability to coordinate the Plan with other programs or 16
informational services considered beneficial by the [Board] STATE TREASURER, including 17
the Maryland Senator Edward J. Kasemeyer Prepaid College Trust established under 18
Subtitle 19 of this title. 19
(b) (1) Except for applications made under § 18–19A–04.1 of this subtitle, the 20
[Board] STATE TREASURER may require an initial application fee to be used for 21
administrative costs of the Plan. 22
(2) The [Board] STATE TREASURER may require additional fees 23
associated with the expenses of the Plan. 24
(c) (1) Contributions to the Plan on behalf of a qualified designated beneficiary 25
may not exceed the maximum amount determined by the [Board] STATE TREASURER to 26
be in accordance with § 529 of the Internal Revenue Code. 27
(2) Contributions to the Plan may be made only in cash or cash equivalent. 28
(3) The Plan shall include provisions for automatic contributions. 29
HOUSE BILL 1290 23
(d) The [Board] STATE TREASURER shall adopt procedures to ensure that 1
contributions to the Plan plus contributions or payments to other qualified State tuition 2
programs do not exceed a total maximum amount determined under § 529 of the Internal 3
Revenue Code for contributions to multiple qualified State tuition programs. 4
(e) (1) The Plan: 5
(i) Shall be established in the form determined by the [Board] 6
STATE TREASURER; and 7
(ii) May be established as a trust to be declared by the [Board] 8
STATE TREASURER. 9
(2) The Plan may be divided into multiple investment portfolios. 10
(3) If the Plan is divided into multiple portfolios as provided in paragraph 11
(2) of this subsection, the debts, liabilities, obligations, and expenses incurred, contracted 12
for, or otherwise existing with respect to a particular portfolio shall be enforceable against 13
the assets of that portfolio only and not against the assets of the Plan generally, if: 14
(i) Distinct records are maintained for each portfolio; and 15
(ii) The assets associated with each portfolio are accounted for 16
separately from the other assets of the Plan. 17
(f) The Maryland College Investment Plan shall be referred to as the Senator 18
Edward J. Kasemeyer College Investment Plan. 19
18–19A–04. 20
(a) A Maryland resident or a nonresident of Maryland may participate in and 21
benefit from the Plan. 22
(b) Distributions shall be requested by the account holder. 23
18–19A–04.1. 24
(a) (1) Subject to paragraph (2) of this subsection, for investment accounts 25
established after December 31, 2016, a State contribution may be made to not more than 26
two investment accounts for each qualified beneficiary as provided in this section if: 27
(i) The qualified beneficiary of the investment account and the 28
account holder are Maryland residents; 29
(ii) The account holder is at least 18 years old for applications filed 30
on or after January 1, 2022; 31
24 HOUSE BILL 1290
(iii) The account holder submits an application to the [Board] STATE 1
TREASURER or [its] THE STATE TREASURER’S designee between January 1 and June 1 2
of each year; 3
(iv) The account holder has Maryland adjusted gross income in the 4
previous taxable year no greater than $112,500 for an individual or $175,000 for a married 5
couple filing a joint return; 6
(v) The account holder files income taxes on or before July 15 of each 7
year; and 8
(vi) The qualified beneficiary is under the age of 26 years in the 9
calendar year before the account holder submits an application. 10
(2) For State contribution application periods after December 31, 2020, a 11
qualified beneficiary may not receive more than two State contributions for each year the 12
qualified beneficiary is eligible for the State contribution under this section. 13
(b) (1) An application may be made in person, online, or by mail. 14
(2) The [Board] STATE TREASURER shall develop: 15
(i) An application form that: 16
1. Includes permission for confirming Maryland taxable 17
income with the Comptroller; and 18
2. Allows for certification of Maryland residency; 19
(ii) A procedure to certify the date and time of receipt of an 20
application; and 21
(iii) Any other necessary procedures for the submittal of applications. 22
(c) (1) For an account holder with Maryland adjusted gross income of less than 23
$50,000 for an individual or $75,000 for a married couple filing a joint return who 24
contributes at least $25 per beneficiary during the contribution period in subsection (e) of 25
this section, the State shall provide an additional $500 per beneficiary. 26
(2) For an account holder with Maryland adjusted gross income of at least 27
$50,000 but less than $87,500 for an individual or at least $75,000 but less than $125,000 28
for a married couple filing a joint return who contributes at least $100 per beneficiary 29
during the contribution period in subsection (e) of this section, the State shall provide an 30
additional $500 per beneficiary. 31
(3) For an account holder with Maryland adjusted gross income of at least 32
$87,500 but no greater than $112,500 for an individual or at least $125,000 but no greater 33 HOUSE BILL 1290 25
than $175,000 for a married couple filing a joint return who contributes at least $250 per 1
beneficiary during the contribution period in subsection (e) of this section, the State shall 2
provide an additional $250 per beneficiary. 3
(d) (1) The Governor shall include in the annual budget bill an appropriation 4
of at least the following amounts for State contributions: 5
(i) $5,000,000 in fiscal year 2018; and 6
(ii) $3,000,000 in fiscal year 2019 and each fiscal year thereafter. 7
(2) If the funding provided in a fiscal year is not sufficient to fully fund all 8
State contributions authorized under this section, the [Board] STATE TREASURER shall: 9
(i) Provide contributions in the order in which applications are 10
received; and 11
(ii) Give priority to applications of account holders who have not 12
received a contribution. 13
(e) (1) An account holder shall contribute at least the amount specified under 14
subsection (c) of this section on or before November 1 of each year in order to qualify for the 15
State contribution. 16
(2) A State contribution shall be made by December 31 of the calendar year 17
in which the account holder made the contribution. 18
(f) (1) An account holder is not eligible for the subtraction modification under 19
§ 10–208 of the Tax – General Article for any taxable year in which the account holder 20
receives a State contribution. 21
(2) An account holder may qualify for not more than $9,000 in State 22
contributions through the lifetime of the account holder. 23
(g) (1) The [Board] STATE TREASURER shall develop and implement by 24
September 1, 2018, an outreach and marketing plan to provide notification to individuals 25
about the availability of a State contribution. 26
(2) The outreach and marketing plan shall: 27
(i) Make use of a variety of marketing media, including billboards, 28
brochures, and electronic resources; and 29
(ii) Provide a centralized contact point for individuals to obtain 30
information about opening an account and the availability of a State contribution. 31
26 HOUSE BILL 1290
[(3) By December 1, 2018, the Board shall submit a report in accordance 1
with § 2–1257 of the State Government Article to the General Assembly on the details of 2
the outreach and marketing plan.] 3
(h) The [Board] STATE TREASURER may adopt any regulations that the [Board] 4
STATE TREASURER considers necessary to carry out the provisions of this section. 5
18–19A–05. 6
(a) (1) The debts, contracts, and obligations of the Plan are not the contracts, 7
debts, or obligations of the State and neither the faith and credit nor taxing power of the 8
State is pledged directly or indirectly or contingently, morally or otherwise, to the payment 9
of the debts, contracts, and obligations. 10
(2) The [Board] STATE TREASURER cannot directly or indirectly or 11
contingently obligate, morally or otherwise, the State to levy or pledge any form of taxation 12
whatsoever for the debts and obligations of the Plan or to make any appropriation for the 13
payment of the debts and obligations of the Plan. 14
(b) Neither the State nor any eligible educational institution shall be liable for 15
any losses or shortage of funds in the event that the account holder’s investment account 16
balance is insufficient to meet the tuition requirements of an institution attended by the 17
qualified designated beneficiary. 18
(c) Money of the Plan may not be considered money of the State or deposited in 19
the State Treasury. 20
(d) Money of the Plan may not be considered money of or commingled with the 21
Maryland Senator Edward J. Kasemeyer Prepaid College Trust. 22
(e) Money of the Plan may not be considered money of or commingled with the 23
Maryland Broker–Dealer College Investment Plan. 24
(f) Money of the Plan may not be considered money of or commingled with the 25
Maryland ABLE Program. 26
18–19A–05.1. 27
The [Board] MARYLAND 529 PROGRAM, Plan, and investment accounts issued 28
under this subtitle are not subject to the provisions of the Insurance Article. 29
18–19A–06. 30
The assets and income of the Maryland Senator Edward J. Kasemeyer College 31
Investment Plan are exempt from State and local taxation. 32
HOUSE BILL 1290 27
18–19A–06.1. 1
(a) In this section, “person” does not include the State. 2
(b) A person may not attach, execute, garnish, or otherwise seize any current or 3
future benefit under an investment account or any asset of the Plan. 4
18–19A–07. 5
(a) (1) The Legislative Auditor shall audit the Plan as provided under Title 2, 6
Subtitle 12 of the State Government Article. 7
(2) The [Board] STATE TREASURER shall obtain an annual audit report 8
from service providers. 9
(b) (1) Within 120 days after the close of each fiscal year, the [Board] STATE 10
TREASURER shall submit to the Governor and, subject to § 2–1257 of the State 11
Government Article, to the General Assembly a report including: 12
(i) A financial accounting of the Plan, including: 13
1. An annual review of the Plan which shall include: 14
A. The status of the investment program; 15
B. The assets held in each class of investment; 16
C. The percentage and dollar value of assets placed with 17
outside managers; 18
D. The income produced by each class of investment; 19
E. The income produced by each investment manager; 20
F. The total deposits into the Plan for the past year; and 21
G. The total withdrawals from the Plan for the past year; and 22
2. A detailed account of the operating and administrative 23
budget for the Plan, which shall include a complete list of revenue sources and expenditures 24
detailing the line item expenditures for: 25
A. Salaries, wages, and fringe benefits; 26
B. Technical and special fees; 27
C. Communication; 28 28 HOUSE BILL 1290
D. Travel; 1
E. Contractual services; 2
F. Supplies and materials; 3
G. Equipment; 4
H. Fixed charges; and 5
I. Other expenses; 6
(ii) The number of new account holders during the previous fiscal 7
year; 8
(iii) Efforts in marketing the Plan; and 9
(iv) Any recommendations of the [Board] STATE TREASURER 10
concerning the operation of the Plan. 11
(2) The [Board] STATE TREASURER shall make available to each account 12
holder a copy of a summary of the report and the option to purchase the full report at a 13
nominal charge. 14
[(c) The audit required by subsection (a)(2) of this section and the report required 15
by subsection (b) of this section, at the Board’s discretion, may be combined with any other 16
audit or report for the same fiscal year required to be submitted by the Board to the 17
Governor and the General Assembly.] 18
18–19B–01. 19
(a) In this subtitle the following words have the meanings indicated. 20
(b) “Account holder” means the person who established an investment account on 21
behalf of a qualified designated beneficiary. 22
(c) [“Board” means the Maryland 529 Board established under § 18–1904 of this 23
title. 24
(d)] “Broker–Dealer Plan” means the Maryland Broker –Dealer College 25
Investment Plan established under this subtitle. 26
[(e)] (D) “Eligible educational institution” has the meaning stated in § 529(e) of 27
the Internal Revenue Code. 28
HOUSE BILL 1290 29
[(f)] (E) “Investment account” means an account established by an account 1
holder under this subtitle on behalf of a qualified designated beneficiary for the purpose of 2
applying distributions toward qualified higher education expenses at eligible educational 3
institutions. 4
[(g)] (F) “Qualified designated beneficiary” has the meaning stated in § 529(e) 5
of the Internal Revenue Code. 6
[(h)] (G) “Qualified higher education expenses” has the meaning stated in § 7
529(e) of the Internal Revenue Code. 8
[(i)] (H) “Qualified State tuition program” has the meaning stated in § 529 of 9
the Internal Revenue Code. 10
18–19B–02. 11
(a) The [Board] STATE TREASURER may establish a Maryland Broker–Dealer 12
College Investment Plan. 13
(b) The purpose of the Broker–Dealer Plan is to provide for a broker–dealer 14
distributed vehicle that would allow contributions to an investment account established for 15
the purposes of meeting the qualified higher education expenses of the qualified designated 16
beneficiary of the account. 17
(c) (1) The [Board] STATE TREASURER shall administer, manage, and 18
promote the Broker–Dealer Plan. 19
(2) The [Board] STATE TREASURER shall administer the Broker–Dealer 20
Plan in compliance with Internal Revenue Service standards for qualified State tuition 21
programs. 22
(d) (1) The [Board] STATE TREASURER shall adopt procedures relating to: 23
(i) Enrollment procedures for participation in the Broker–Dealer 24
Plan; 25
(ii) Start–up costs incurred by the State for the development of the 26
Broker–Dealer Plan with these costs to be reimbursed to the State by the Broker–Dealer 27
Plan; 28
(iii) Early withdrawals so that there will be no major detriment to 29
the remaining account holders in the Broker–Dealer Plan; 30
(iv) Transfer of funds from the Broker–Dealer Plan to other qualified 31
State tuition programs and from other qualified State tuition programs to the 32
Broker–Dealer Plan in accordance with federal law; and 33 30 HOUSE BILL 1290
(v) Transfer of funds from the Broker–Dealer Plan to a qualified 1
ABLE program established in accordance with § 529A of the Internal Revenue Code. 2
(2) The [Board] STATE TREASURER shall adopt any other procedures 3
that the [Board] STATE TREASURER considers necessary to carry out the provisions of 4
this subtitle. 5
(e) At least annually, the [Board] STATE TREASURER shall issue to each 6
account holder a statement that provides a separate accounting for each qualified 7
designated beneficiary providing the following information with respect to each account: 8
(1) The beginning balance; 9
(2) Contributions to the account; 10
(3) Withdrawals from the account during the previous year; and 11
(4) Ending investment account value. 12
18–19B–03. 13
(a) (1) The [Board] STATE TREASURER may issue requests for proposals to 14
evaluate and determine the means for the administration, management, promotion, or 15
marketing of the Broker–Dealer Plan. 16
(2) The [Board] STATE TREASURER shall consider proposals that meet 17
the following criteria: 18
(i) Ability to develop and administer an investment program of a 19
nature similar to the objectives of the Broker–Dealer Plan; 20
(ii) Ability to administer financial programs with individual account 21
records and reporting; and 22
(iii) Ability to market the Broker–Dealer Plan to Maryland residents 23
and, at the [Board’s] STATE TREASURER’S discretion, nonresidents of Maryland. 24
(b) (1) The [Board] STATE TREASURER may require an initial enrollment fee 25
to be used for administrative costs of the Broker–Dealer Plan. 26
(2) The [Board] STATE TREASURER may require additional fees 27
associated with the expenses of the Broker–Dealer Plan. 28
HOUSE BILL 1290 31
(c) (1) Contributions to the Broker–Dealer Plan on behalf of a qualified 1
designated beneficiary may not exceed the maximum amount determined by the [Board] 2
STATE TREASURER to be in accordance with § 529 of the Internal Revenue Code. 3
(2) Contributions to the Broker–Dealer Plan may be made only in cash or 4
cash equivalents. 5
(3) The Broker–Dealer Plan shall include provisions for automatic 6
contributions. 7
(d) (1) The Broker–Dealer Plan: 8
(i) May be established as one or more separate plans as determined 9
by the [Board] STATE TREASURER; 10
(ii) If established by the [Board] STATE TREASURER, shall be 11
established in the form determined by the [Board] STATE TREASURER; 12
(iii) Shall be marketed and promoted under the name or names 13
determined by the [Board] STATE TREASURER; and 14
(iv) May be established as one or more trusts to be declared by the 15
[Board] STATE TREASURER. 16
(2) The Broker–Dealer Plan may be divided into multiple investment 17
options. 18
18–19B–04. 19
(a) A Maryland resident or, at the [Board’s] STATE TREASURER’S discretion, a 20
nonresident of Maryland may participate in and benefit from the Broker–Dealer Plan. 21
(b) Distributions shall be requested by the account holder. 22
18–19B–05. 23
(a) (1) The debts, contracts, and obligations of the Broker–Dealer Plan are not 24
the contracts, debts, or obligations of the State, and neither the faith and credit nor taxing 25
power of the State is pledged directly or indirectly or contingently, morally or otherwise, to 26
the payment of the debts, contracts, and obligations. 27
(2) The [Board] STATE TREASURER cannot directly or indirectly or 28
contingently obligate, morally or otherwise, the State to levy or pledge any form of taxation 29
whatsoever for the debts and obligations of the Broker–Dealer Plan or to make any 30
appropriation for the payment of the debts and obligations of the Broker–Dealer Plan. 31
32 HOUSE BILL 1290
(b) Neither the State nor any eligible educational institution shall be liable for 1
any losses or shortage of funds in the event that the account holder’s investment account 2
balance is insufficient to meet the tuition requirements of an institution attended by the 3
qualified designated beneficiary. 4
(c) Money of the Broker–Dealer Plan may not be considered money of the State 5
or deposited in the State Treasury. 6
(d) Money of the Broker–Dealer Plan may not be considered money of or 7
commingled with the Maryland Senator Edward J. Kasemeyer Prepaid College Trust. 8
(e) Money of the Broker–Dealer Plan may not be considered money of or 9
commingled with the Maryland Senator Edward J. Kasemeyer College Investment Plan. 10
(f) Money of the Broker–Dealer Plan may not be considered money of or 11
commingled with the Maryland ABLE Program. 12
18–19B–06. 13
(a) The [Board] MARYLAND 529 PROGRAM, the Broker–Dealer Plan, and the 14
investment accounts issued under this subtitle are not subject to the provisions of the 15
Insurance Article. 16
(b) The assets and income of the Maryland Broker–Dealer College Investment 17
Plan are exempt from State and local taxation. 18
18–19B–07. 19
(a) In this section, “person” does not include the State. 20
(b) A person may not attach, execute, garnish, or otherwise seize any current or 21
future benefit under an investment account or any asset of the Broker–Dealer Plan. 22
18–19B–08. 23
(a) The Legislative Auditor shall audit the Broker–Dealer Plan as provided under 24
Title 2, Subtitle 12 of the State Government Article. 25
(b) The [Board] STATE TREASURER shall obtain an annual audit report from 26
service provider(s) within six months of the end of such service provider’s reporting period. 27
18–19C–01. 28
(a) In this subtitle the following words have the meanings indicated. 29
(b) “ABLE account” means an account described under § 529A(e) of the Internal 30
Revenue Code. 31 HOUSE BILL 1290 33
(c) “ABLE account contributor” means an individual who contributes money to 1
an ABLE account described under § 529A(e) of the Internal Revenue Code. 2
(d) “ABLE account holder” means an individual who has established an account 3
described under § 529A(e) of the Internal Revenue Code and is the designated beneficiary 4
of the account. 5
(e) [“Board” means the Maryland 529 Board established under § 18–1904 of this 6
title. 7
(f)] “Designated beneficiary” means an individual described in § 529A(e) of the 8
Internal Revenue Code. 9
[(g)] (F) “Maryland ABLE Program” means a qualified ABLE program described 10
in § 529A(b) of the Internal Revenue Code. 11
[(h)] (G) “Qualified disability expenses” means expenses described in § 529A(e) 12
of the Internal Revenue Code. 13
18–19C–02. 14
(a) (1) The [Board] STATE TREASURER shall establish a Maryland ABLE 15
Program that shall be subject to the provisions of § 529A of the Internal Revenue Code. 16
(2) It is the goal of the State that the Maryland ABLE Program be fully 17
operational by October 1, 2017. 18
(b) The purpose of the Maryland ABLE Program is to: 19
(1) Encourage and assist individuals and families in saving private funds 20
to support individuals with disabilities to maintain health, independence, and quality of 21
life; and 22
(2) Provide secure funding for disability–related expenses on behalf of 23
designated beneficiaries with disabilities that will supplement, not supplant, benefits 24
provided through private insurance, the Medicaid program under Title XIX of the Social 25
Security Act, the Supplemental Security Income program under Title XVI of the Social 26
Security Act, the beneficiary’s employment, and any other source. 27
(c) (1) The [Board] STATE TREASURER shall develop, establish, administer, 28
manage, and promote the Maryland ABLE Program. 29
(2) The [Board] STATE TREASURER shall administer the Maryland 30
ABLE Program in compliance with Internal Revenue Service standards for qualified ABLE 31
programs. 32 34 HOUSE BILL 1290
(3) The [Board] STATE TREASURER shall work in consultation with the 1
Department of Disabilities to develop, administer, manage, and promote the Maryland 2
ABLE Program. 3
(4) The [Board] STATE TREASURER may collaborate and participate with 4
other states or entities to develop, administer, manage, and promote the Maryland ABLE 5
Program, including participating with a consortium of states that are implementing ABLE 6
programs in those states or as a consortium of states. 7
(d) (1) The [Board] STATE TREASURER shall adopt procedures relating to: 8
(i) Enrollment for participation in the Maryland ABLE Program; 9
and 10
(ii) Start–up costs incurred by the State for the development of the 11
Maryland ABLE Program with these costs to be reimbursed to the State by the Maryland 12
ABLE Program. 13
(2) The [Board] STATE TREASURER shall adopt any other procedures 14
that the [Board] STATE TREASURER considers necessary to carry out the provisions of 15
this subtitle. 16
(e) At least annually, the [Board] STATE TREASURER shall issue to each ABLE 17
account holder a statement that provides a separate accounting for each designated 18
beneficiary providing the following information with respect to each account: 19
(1) The beginning balance; 20
(2) Contributions to the account; 21
(3) Distributions from the account during the previous year; and 22
(4) Ending ABLE account value. 23
18–19C–03. 24
(a) (1) The [Board] STATE TREASURER may issue requests for proposals to 25
evaluate and determine the means for the administration, management, promotion, or 26
marketing of the Maryland ABLE Program. 27
(2) The [Board] STATE TREASURER shall consider proposals that meet 28
the following criteria: 29
(i) Ability to develop and administer an investment program of a 30
nature similar to the objectives of the Maryland ABLE Program; 31 HOUSE BILL 1290 35
(ii) Ability to administer financial programs with individual account 1
records and reporting; and 2
(iii) Ability to market the Maryland ABLE Program to eligible 3
individuals. 4
(b) (1) The [Board] STATE TREASURER may require an initial enrollment fee 5
to be used for administrative costs of the Maryland ABLE Program. 6
(2) The [Board] STATE TREASURER may require additional reasonable 7
fees associated with the expenses of the Maryland ABLE Program. 8
(c) (1) The Maryland ABLE Program is subject to the provisions of § 529A of 9
the Internal Revenue Code. 10
(2) The Maryland ABLE Program shall include provisions for automatic 11
contributions. 12
(3) Money and assets in the accounts established under the Maryland 13
ABLE Program or an ABLE program in any other state may not be considered for the 14
purpose of determining eligibility to receive, or the amount of, any assistance or benefits 15
from local or State means–tested programs. 16
(4) Money and assets contributed in each calendar year to the account of 17
each ABLE account holder may not exceed the amount specified in § 529A(b)(2) of the 18
Internal Revenue Code for each calendar year in which the taxable year begins. 19
(5) Contributions to the account of each ABLE account holder may not 20
exceed the maximum amount determined by the [Board] STATE TREASURER to be in 21
accordance with § 529A(b)(6) of the Internal Revenue Code. 22
(d) The Maryland ABLE Program may receive money from: 23
(1) Appropriations in the State budget; 24
(2) Reasonable fees assessed to beneficiaries; 25
(3) Grants or other assistance from federal, State, or local government; and 26
(4) Any other money from any public or private source. 27
(e) (1) The Maryland ABLE Program: 28
(i) May be established as one or more separate plans as determined 29
by the [Board] STATE TREASURER; 30
36 HOUSE BILL 1290
(ii) Shall be established in the form determined by the [Board] 1
STATE TREASURER; 2
(iii) Shall be marketed and promoted under the name or names 3
determined by the [Board] STATE TREASURER; and 4
(iv) May be established as one or more trusts to be declared by the 5
[Board] STATE TREASURER. 6
(2) The Maryland ABLE Program may be divided into multiple investment 7
options. 8
18–19C–04. 9
(a) An eligible individual, as defined in § 529A(e) of the Internal Revenue Code, 10
may participate in and benefit from the Maryland ABLE Program. 11
(b) Distributions shall be requested by the designated beneficiary subject to the 12
provisions of § 529A of the Internal Revenue Code. 13
18–19C–05. 14
(a) (1) The debts, contracts, and obligations of the Maryland ABLE Program 15
are not the contracts, debts, or obligations of the State, and neither the faith and credit nor 16
taxing power of the State is pledged directly or indirectly or contingently, morally or 17
otherwise, to the payment of the debts, contracts, and obligations. 18
(2) The [Board] STATE TREASURER may not directly or indirectly or 19
contingently obligate, morally or otherwise, the State to levy or pledge any form of taxation 20
whatsoever for the debts and obligations of the Maryland ABLE Program or to make any 21
appropriation for the payment of the debts and obligations of the Maryland ABLE Program. 22
(b) The State may not be liable for any losses or shortage of funds in the event 23
that the designated beneficiary’s ABLE account balance is insufficient to meet the 24
designated beneficiary’s qualified disability expenses. 25
(c) Money of the Maryland ABLE Program may not be considered money of the 26
State or deposited in the State Treasury. 27
(d) Money of the Maryland ABLE Program may not be considered money of or 28
commingled with the Maryland Senator Edward J. Kasemeyer Prepaid College Trust. 29
(e) Money of the Maryland ABLE Program may not be considered money of or 30
commingled with the Maryland Senator Edward J. Kasemeyer College Investment Plan. 31
(f) Money of the Maryland ABLE Program may not be considered money of or 32
commingled with the Maryland Broker–Dealer College Investment Plan. 33 HOUSE BILL 1290 37
18–19C–06. 1
(a) The [Board] MARYLAND 529 PROGRAM, the Maryland ABLE Program, and 2
the ABLE accounts issued under this subtitle are not subject to the provisions of the 3
Insurance Article. 4
(b) The assets and income of the Maryland ABLE Program are exempt from State 5
and local taxation. 6
18–19C–07. 7
(a) In this section, “person” does not include the State. 8
(b) A person may not attach, execute, garnish, or otherwise seize any current or 9
future benefit under an ABLE account or any asset of the Maryland ABLE Program. 10
18–19C–08. 11
(a) The Legislative Auditor shall audit the Maryland ABLE Program as provided 12
under Title 2, Subtitle 12 of the State Government Article. 13
(b) The [Board] STATE TREASURER shall obtain an annual audit report from a 14
service provider within 6 months of the end of the reporting period of the service provider. 15
18–19C–09. 16
(a) The [Board] STATE TREASURER shall issue refunds as specified in this 17
section. 18
(b) If the contribution of an ABLE account contributor under the Maryland ABLE 19
Program would result in aggregate contributions from all contributors to the ABLE account 20
for the taxable year exceeding the amount specified in § 529A(b)(2) of the Internal Revenue 21
Code for each calendar year in which the taxable year begins, the [Board] STATE 22
TREASURER shall issue a refund to the ABLE account contributor. 23
(c) The [Board] STATE TREASURER shall adopt procedures to ensure that 24
contributions to the account of each ABLE account holder do not exceed the total maximum 25
amount determined under § 529A(b)(6) of the Internal Revenue Code. 26
18–19C–10. 27
(a) Unless prohibited by federal law, on the death of a designated beneficiary, 28
money and assets in an ABLE account may be transferred to: 29
(1) The estate of the designated beneficiary; or 30 38 HOUSE BILL 1290
(2) An ABLE account for another eligible individual specified by the 1
designated beneficiary or the estate of the designated beneficiary. 2
(b) Unless required by federal law, an agency or instrumentality of the State may 3
not seek payment under § 529A(f) of the Internal Revenue Code from an ABLE account or 4
its proceeds for any amount of medical assistance paid for the designated beneficiary. 5
Article – State Finance and Procurement 6
11–203. 7
(f) Except as provided in Title 12, Subtitle 4 and Title 14, Subtitle 3 of this article, 8
this Division II does not apply to Maryland 529 for: 9
(1) services of managers to invest the assets of the Maryland Senator 10
Edward J. Kasemeyer Prepaid College Trust in accordance with the comprehensive 11
investment plan adopted by the [Maryland 529 Board] STATE TREASURER under § 12
18–1906 of the Education Article; and 13
(2) expenditures to manage, maintain, and enhance the value of the assets 14
of the Maryland Senator Edward J. Kasemeyer Prepaid College Trust in accordance with 15
the comprehensive investment plan adopted by the [Maryland 529 Board] STATE 16
TREASURER under § 18–1906 of the Education Article. 17
Article – State Government 18
9–803. 19
(a) The Commission consists of the following members: 20
(10) the Secretary of Higher Education, or the Secretary’s designee; [and] 21
(11) THE EXECUTIVE DIRECTOR OF THE MARYLAND 529 PROGRAM, 22
OR THE EXECUTIVE DIRECTOR’S DESIGNEE; AND 23
[(11)] (12) the following members, appointed by the Governor: 24
(i) one member of the Board of Trustees of the Maryland Teachers 25
and State Employees Supplemental Retirement Plans; 26
(ii) [one member of the Maryland 529 Board; 27
(iii)] one member of the Maryland State Education Association who 28
teaches a course involving principles of financial education; 29
HOUSE BILL 1290 39
[(iv)] (III) one representative of the Maryland CASH Campaign; 1
[(v)] (IV) one representative of a community–focused nonprofit 2
organization that provides free financial education in the State; 3
[(vi)] (V) one representative of a philanthropic organization that 4
provides funding for financial education in the State; 5
[(vii)] (VI) one representative of the Maryland Council on Economic 6
Education or the Maryland Coalition for Financial Literacy; 7
[(viii)] (VII) one representative of a bank, whether or not 8
State–chartered, that has a branch in the State; 9
[(ix)] (VIII) one representative of a credit union, whether or not 10
State–chartered, that has a branch in the State; 11
[(x)] (IX) one licensed mortgage broker holding the Maryland 12
Association of Mortgage Brokers’ “Lending Seal of Integrity”; 13
[(xi)] (X) one member of the Maryland Association of CPAs; and 14
[(xii)] (XI) one representative of a nonprofit organization in the State 15
that provides financial assistance and free financial education to State residents for 16
postsecondary education. 17
SECTION 2. AND BE IT FURTHER ENACTED, Th at: 18
(a) There is a Workgroup on the Maryland 529 Prepaid College Trust Program. 19
(b) The Workgroup consists of the following members: 20
(1) the State Treasurer; 21
(2) two Maryland 529 account holders who have experienced issues 22
accessing their funds, appointed by the Governor; 23
(3) two members of the Senate of Maryland, appointed by the President of 24
the Senate; and 25
(4) two members of the House of Delegates, appointed by the Speaker of 26
the House. 27
(c) The State Treasurer shall provide staff for the Workgroup. 28
40 HOUSE BILL 1290
(d) The Workgroup shall elect a chair of the Workgroup by a majority vote at the 1
first meeting. 2
(e) A member of the Workgroup: 3
(1) may not receive compensation as a member of the Workgroup; but 4
(2) is entitled to reimbursement for expenses under the Standard State 5
Travel Regulations, as provided in the State budget. 6
(f) The Workgroup shall: 7
(1) identify policies, procedures, and practices that led to issues relating to 8
the earnings calculation formula and Maryland 529 account holders’ inability to access 9
their prepaid college trust benefits to pay for college expenses; and 10
(2) develop and make recommendations for improvement in: 11
(i) the Maryland 529 policies, procedures, and practices to ensure 12
the prevention of similar issues in the future; 13
(ii) communication and transparency for Maryland 529 account 14
holders; and 15
(iii) accountability for the individuals responsible for properly 16
exercising Maryland 529’s fiduciary responsibility and managing the prepaid college trust 17
to meet its contractual obligations. 18
(g) On or before June 1, 2024, the Workgroup shall report its findings and 19
recommendations to the Governor and, in accordance with § 2 –1257 of the State 20
Government Article, the General Assembly. 21
SECTION 3. AND BE IT FURTHER ENACTED, That, on June 1, 2023, the 22
Maryland 529 Board is hereby abolished and the State Treasurer shall be the successor of 23
the Maryland 529 Board. 24
SECTION 4. AND BE IT FURTHER ENACTED, That: 25
(a) The responsibility for administering the Maryland 529 Program shall be 26
transferred to the Office of the State Treasurer on June 1, 2023. 27
(b) (1) All appropriations, including State and federal funds, held by the 28
agencies and units of the State to carry out the functions, programs, and services 29
transferred under this Act shall be transferred to the Office of the State Treasurer on June 30
1, 2023. 31
HOUSE BILL 1290 41
(2) Funding for the services and programs under the Maryland 529 1
Program shall be provided for the Office of the State Treasurer beginning in the fiscal year 2
2025 State budget. 3
(3) Federal fund grants directed to the State through other State agencies 4
shall be transferred to the Office of the State Treasurer on June 1, 2023. 5
(c) On June 1, 2023, all of the functions, powers, duties, books and records 6
(including electronic records), real and personal property, equipment, fixtures, assets, 7
liabilities, obligations, credits, rights, and privileges of the agencies, units, and entities that 8
are transferred under this Act shall be transferred to the Office of the State Treasurer. 9
SECTION 5. AND BE IT FURTHER ENACTED, That all employees who are 10
transferred to the Office of the State Treasurer as a result of this Act shall be transferred 11
without diminution of their rights, benefits, employment, or retirement status. 12
SECTION 6. AND BE IT FURTHER ENACTED, That, except as expressly provided 13
to the contrary in this Act, any transaction affected by or flowing from any statute added, 14
amended, repealed, or transferred under this Act and validly entered into before the 15
effective date of this Act, and every right, duty, or interest flowing from it remains valid 16
after the effective date of this Act and may be terminated, completed, consummated, or 17
enforced under the law. 18
SECTION 7. AND BE IT FURTHER ENACTED, That, except as otherwise provided 19
by law, all existing laws, regulations, proposed regulations, standards and guidelines, 20
policies, orders and other directives, forms, plans, memberships, contracts, property, 21
investigations, administrative and judicial responsibilities, rights to sue and be sued, and 22
all other duties and responsibilities associated with the functions of the agencies and units 23
that are subjects of this Act prior to the effective date of this Act shall continue in effect 24
under and, as appropriate, are legal and binding on the State Treasurer until completed, 25
withdrawn, canceled, modified, or otherwise changed. 26
SECTION 8. AND BE IT FURTHER ENACTE D, That the regulations regarding the 27
Maryland 529 Program that were adopted before June 1, 2023, by the Maryland 529 Board 28
that do not conflict with the provisions of this Act continue to be in force and effect unless 29
otherwise altered by the State Treasurer. 30
SECTION 9. AND BE IT FURTHER ENACTED, That , as provided in this Act: 31
(a) The State Treasurer is the successor of the Maryland 529 Board. 32
(b) In every law, executive order, rule, regulation, policy, or document created by 33
an official, an employee, or a unit of this State, the names and titles of those agencies and 34
officials mean the names and titles of the successor agency or official. 35
SECTION 10. AND BE IT FURTHER ENACTED, That any transaction or 36
employment status affected by or flowing from any change of nomenclature or any statute 37 42 HOUSE BILL 1290
amended by this Act and validly entered into or existing before the effective date of this Act 1
and every right, duty, or interest flowing from a statute amended by this Act remains valid 2
after the effective date of this Act and may be terminated, completed, consummated, or 3
enforced as required or allowed by any statute amended by this Act as though the 4
amendment had not occurred. If a change in nomenclature involves a change in name or 5
designation of any State unit, the successor unit shall be considered in all respects as 6
having the powers and obligations granted to the former unit. 7
SECTION 11. AND BE IT FURTHER ENACTED, That: 8
(a) The continuity of every commission, office, department, agency, or other unit 9
is retained. 10
(b) The personnel, records, files, furniture, fixtures, and other properties and all 11
appropriations, credits, assets, liabilities, and obligations of each retained unit are 12
continued as the personnel, records, files, furniture, fixtures, properties, appropriations, 13
credits, assets, liabilities, and obligations of the unit under the laws enacted by this Act. 14
SECTION 12. AND BE IT FURTHER ENACTED, That: 15
(a) The balance of a Maryland Senator Edward J. Kasemeyer Prepaid College 16
Trust account, following the distribution in accordance with Section 1 of this Act, is an 17
accurate allocation of principal and earnings of that account. 18
(b) The distribution to the account in accordance with Section 1 of this Act may 19
not be considered a contribution to the account for purposes of provisions of law governing 20
the Maryland income tax. 21
SECTION 13. AND BE IT FURTHER ENACTED, That the publisher of the 22
Annotated Code of Maryland, in consultation with and subject to the approval of the 23
Department of Legislative Services, shall correct, with no further action required by the 24
General Assembly, cross–references and terminology rendered incorrect by this Act. The 25
publisher shall adequately describe any correction that is made in an editor’s note following 26
the section affected. 27
SECTION 14. AND BE IT FURTHER ENACTED, That this Act is an emergency 28
measure, is necessary for the immediate preservation of the public health or safety, has 29
been passed by a yea and nay vote supported by three–fifths of all the members elected to 30
each of the two Houses of the General Assembly, and shall take effect from the date it is 31
enacted. 32