EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
[Brackets] indicate matter deleted from existing law.
*sb0747*
SENATE BILL 747
L6 4lr1734
CF HB 165
By: Senators Guzzone and Benson
Introduced and read first time: February 1, 2024
Assigned to: Budget and Taxation
A BILL ENTITLED
AN ACT concerning 1
Local Government – Annual Audit Reporting Requirements – Alterations 2
FOR the purpose of requiring a certain amount of State aid to be discontinued if a county, 3
municipality, or special taxing district does not submit a certain audit report within 4
a certain period of time after the deadline for the report, subject to a certain 5
condition; and generally relating to local government reporting requirements. 6
BY repealing and reenacting, without amendments, 7
Article – Local Government 8
Section 16–304 9
Annotated Code of Maryland 10
(2013 Volume and 2023 Supplement) 11
BY repealing and reenacting, with amendments, 12
Article – Local Government 13
Section 16–306 14
Annotated Code of Maryland 15
(2013 Volume and 2023 Supplement) 16
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 17
That the Laws of Maryland read as follows: 18
Article – Local Government 19
16–304. 20
(a) (1) Except as provided in paragraph (2) of this subsection, on or before 21
October 31 after the close of its fiscal year, each county, municipality, and special taxing 22
district shall file with the Department of Legislative Services a financial report for that 23
fiscal year. 24
2 SENATE BILL 747
(2) (i) A county, municipality, or special taxing district with a 1
population of over 400,000 may file its financial report on or before December 31 after the 2
close of its fiscal year. 3
(ii) Unless subparagraph (i) of this paragraph applies, Howard 4
County may file its financial report on or before November 30 after the close of its fiscal 5
year. 6
(iii) Allegany County, Calvert County, Caroline County, Charles 7
County, Frederick County, Garrett County, Queen Anne’s County, St. Mary’s County, 8
Somerset County, Talbot County, and Wicomico County may file the county’s financial 9
report on or before December 31 after the close of the county’s fiscal year. 10
(b) The financial report required under subsection (a) of this section shall be: 11
(1) prepared on the form established by the Department of Legislative 12
Services; and 13
(2) verified by the chief executive officer of the county, municipality, or 14
special taxing district. 15
(c) If a county, municipality, or special taxing district does not comply with 16
subsection (a) of this section, the Comptroller, on notice from the Executive Director of the 17
Department of Legislative Services, may order the discontinuance of all money, grants, or 18
State aid that the county, municipality, or special taxing district is entitled to receive under 19
State law, including money from: 20
(1) the income tax; 21
(2) the tax on racing; 22
(3) the recordation tax; 23
(4) the admissions and amusement tax; and 24
(5) the license tax. 25
16–306. 26
(a) The county, municipality, or special taxing district shall report the results of 27
the audit required under § 16–305 of this subtitle to the Legislative Auditor: 28
(1) on the form and in the manner that the Legislative Auditor requires; 29
and 30
(2) on or before the date the financial report of the county, municipality, or 31
special taxing district must be filed under § 16–304(a) of this subtitle. 32 SENATE BILL 747 3
(b) An audit report filed by a county, municipality, or special taxing district with 1
the Legislative Auditor shall include financial statements of the county, municipality, or 2
special taxing district that are: 3
(1) prepared in accordance with generally accepted accounting principles; 4
and 5
(2) audited in accordance with generally accepted auditing standards. 6
(c) An audit report filed with the Legislative Auditor is a public record. 7
(d) [If] EXCEPT AS PROVIDED IN SUBSECTION (E) OF THIS SECT ION, IF a 8
county, municipality, or special taxing district does not comply with subsection (a) or (b) of 9
this section, the Comptroller, on notice from the Executive Director of the Department of 10
Legislative Services, may order the discontinuance of all money, grants, or State aid that 11
the county, municipality, or special taxing district is entitled to receive under State law 12
that are distributed by the Comptroller, the clerks of the court, or any other unit of State 13
government. 14
(E) (1) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , IF A COUNTY, 15
MUNICIPALITY, OR SPECIAL TAXING DI STRICT DOES NOT COMP LY WITH SUBSECTION 16
(A) OR (B) OF THIS SECTION WITH IN 1 CALENDAR YEAR AFTER THE DEADLINE 17
DESCRIBED IN SUBSECT ION (A)(2) OF THIS SECTION, THE EXECUTIVE DIRECTOR OF 18
THE DEPARTMENT OF LEGISLATIVE SERVICES SHALL NOTIFY THE COMPTROLLER 19
AND THE COMPTROLLER SHALL ORD ER THE DISCONTINUANC E OF 20% OF ALL 20
STATE AID FOR POLICE AID, HIGHWAY USER REVENUE S, AND DISPARITY GRANTS 21
THAT THE COUNTY , MUNICIPALITY, OR SPECIAL TAXI NG DISTRICT IS ENTIT LED TO 22
RECEIVE UNDER STATE LAW THAT IS DIS TRIBUTED BY THE COMPTROLLER , THE 23
CLERKS OF THE COURT , OR ANY OTHER UNIT OF STATE GOVERNMENT . 24
(2) (I) A DISCONTINUANCE OF FU NDS UNDER PARAGRAPH (1) OF 25
THIS SUBSECTION SHAL L REMAIN IN EFFECT F OR A COUNTY, MUNICIPALITY, OR 26
SPECIAL TAXING DISTR ICT UNTIL THE COUNTY , MUNICIPALITY, OR SPECIAL TAXING 27
DISTRICT SUBMITS THE AUDIT REPORT REQUIRE D UNDER THIS SECTION . 28
(II) 1. SUBJECT TO SUBSUBPARA GRAPH 2 OF THIS 29
SUBPARAGRAPH , THE EXECUTIVE DIRECTOR OF THE DEPARTMENT OF 30
LEGISLATIVE SERVICES SHALL NOTIFY THE COMPTROLLER AND THE 31
COMPTROLLER SHALL ORD ER THE CONTINUANCE O F THE FUNDS DISCONTI NUED 32
UNDER PARAGRAPH (1) OF THIS SUBSECTION P ROMPTLY AFTER THE CO UNTY, 33
MUNICIPALITY, OR SPECIAL TAXING DI STRICT SUBMITS THE AUDIT REPORT 34
REQUIRED UNDER THIS SECTION. 35
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2. A. IF A CONTINUANCE OF F UNDS IS ORDERED 1
UNDER SUBSUBPARAGRAP H 1 OF THIS SUBPARAGRAPH , ONLY THE DISCONTINUE D 2
FUNDS FOR THE CURREN T FISCAL YEAR SHALL BE RELEASED. 3
B. FOR ANY FISCAL YEAR I N WHICH A COUNTY , 4
MUNICIPALITY, OR SPECIAL TAXING DI STRICT FAILED TO SUB MIT THE AUDIT 5
REPORT REQUIRED UNDE R THIS SECTION, THE DISCONTINUED FUN DS FOR THAT 6
FISCAL YEAR SHALL RE VERT TO THE GENERAL FUND OF THE STATE. 7
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 8
1, 2024. 9