WES MOORE, Governor Ch. 499
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Chapter 499
(Senate Bill 747)
AN ACT concerning
Local Government – Annual Audit Reporting Requirements – Alterations
FOR the purpose of requiring a certain amount of State aid to be discontinued if a county,
municipality, or special taxing district does not submit a certain audit report within
a certain period of time after the deadline for the report, subject to a certain
condition; and generally relating to local government reporting requirements.
BY repealing and reenacting, without amendments,
Article – Local Government
Section 16–304
Annotated Code of Maryland
(2013 Volume and 2023 Supplement)
BY repealing and reenacting, with amendments,
Article – Local Government
Section 16–306
Annotated Code of Maryland
(2013 Volume and 2023 Supplement)
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND,
That the Laws of Maryland read as follows:
Article – Local Government
16–304.
(a) (1) Except as provided in paragraph (2) of this subsection, on or before
October 31 after the close of its fiscal year, each county, municipality, and special taxing
district shall file with the Department of Legislative Services a financial report for that
fiscal year.
(2) (i) A county, municipality, or special taxing district with a
population of over 400,000 may file its financial report on or before December 31 after the
close of its fiscal year.
(ii) Unless subparagraph (i) of this paragraph applies, Howard
County may file its financial report on or before November 30 after the close of its fiscal
year.
(iii) Allegany County, Calvert County, Caroline County, Charles
County, Frederick County, Garrett County, Queen Anne’s County, St. Mary’s County, Ch. 499 2024 LAWS OF MARYLAND
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Somerset County, Talbot County, and Wicomico County may file the county’s financial
report on or before December 31 after the close of the county’s fiscal year.
(b) The financial report required under subsection (a) of this section shall be:
(1) prepared on the form established by the Department of Legislative
Services; and
(2) verified by the chief executive officer of the county, municipality, or
special taxing district.
(c) If a county, municipality, or special taxing district does not comply with
subsection (a) of this section, the Comptroller, on notice from the Executive Director of the
Department of Legislative Services, may order the discontinuance of all money, grants, or
State aid that the county, municipality, or special taxing district is entitled to receive under
State law, including money from:
(1) the income tax;
(2) the tax on racing;
(3) the recordation tax;
(4) the admissions and amusement tax; and
(5) the license tax.
16–306.
(a) The county, municipality, or special taxing district shall report the results of
the audit required under § 16–305 of this subtitle to the Legislative Auditor:
(1) on the form and in the manner that the Legislative Auditor requires;
and
(2) on or before the date the financial report of the county, municipality, or
special taxing district must be filed under § 16–304(a) of this subtitle.
(b) An audit report filed by a county, municipality, or special taxing district with
the Legislative Auditor shall include financial statements of the county, municipality, or
special taxing district that are:
(1) prepared in accordance with generally accepted accounting principles;
and
(2) audited in accordance with generally accepted auditing standards. WES MOORE, Governor Ch. 499
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(c) An audit report filed with the Legislative Auditor is a public record.
(d) [If] EXCEPT AS PROVIDED IN SUBSECTION (E) OF THIS SECTION , IF a
county, municipality, or special taxing district does not comply with subsection (a) or (b) of
this section, the Comptroller, on notice from the Executive Director of the Department of
Legislative Services, may order the discontinuance of all money, grants, or State aid that
the county, municipality, or special taxing district is entitled to receive under State law
that are distributed by the Comptroller, the clerks of the court, or any other unit of State
government.
(E) (1) SUBJECT TO PARAGRAPH (2) OF THIS SUBSECTION , IF A COUNTY,
MUNICIPALITY, OR SPECIAL TAXING DI STRICT DOES NOT COMP LY WITH SUBSECTION
(A) OR (B) OF THIS SECTION WITH IN 1 2 CALENDAR YEAR YEARS AFTER THE
DEADLINE DESCRIBED I N SUBSECTION (A)(2) OF THIS SECTION , THE EXECUTIVE
DIRECTOR OF THE DEPARTMENT OF LEGISLATIVE SERVICES SHALL NOTIFY THE
COMPTROLLER AND THE COMPTROLLER SHALL ORD ER THE DISCONTINUANC E OF
20% OF ALL STATE AID FOR POLICE AID, THE CURRENT FISCAL Y EAR FOR HIGHWAY
USER REVENUES , AND DISPARITY GRANTS THAT THE COUNTY , MUNICIPALITY, OR
SPECIAL TAXING DISTR ICT IS OTHERWISE ENTITLED TO RECEIVE UNDER STATE LAW
THAT IS DISTRIBUTED BY THE COMPTROLLER , THE CLERKS OF THE CO URT, OR ANY
OTHER UNIT OF STATE GOVERNMENT .
(2) (I) A DISCONTINUANCE OF FU NDS UNDER PARAGRAPH (1) OF
THIS SUBSECTION SHALL REMAIN I N EFFECT FOR A COUNT Y, MUNICIPALITY, OR
SPECIAL TAXING DISTR ICT UNTIL THE COUNTY , MUNICIPALITY, OR SPECIAL TAXING
DISTRICT SUBMITS THE AUDIT REPORT REQUIRE D UNDER THIS SECTION .
(II) 1. SUBJECT TO SUBSUBPARA GRAPH 2 OF THIS
SUBPARAGR APH, THE EXECUTIVE DIRECTOR OF THE DEPARTMENT OF
LEGISLATIVE SERVICES SHALL NOTIFY THE COMPTROLLER AND THE
COMPTROLLER SHALL ORD ER THE CONTINUANCE REINSTATEMENT OF THE FUNDS
DISCONTINUED UNDER P ARAGRAPH (1) OF THIS SUBSECTION P ROMPTLY AFTER THE
COUNTY, MUNICIPALITY, OR SPECIAL TAXING DI STRICT SUBMITS THE A UDIT
REPORT REQUIRED UNDE R THIS SECTION.
2. A. IF A CONTINUANCE REINSTATEMENT OF FUNDS
IS ORDERED UNDER SUB SUBPARAGRAPH 1 OF THIS SUBPARAGRAPH , ONLY THE
DISCONTINUED FUNDS F OR THE CURRENT FISCA L YEAR SHALL BE RELEASED .
B. FOR ANY FISCAL YEAR I N WHICH IF A COUNTY,
MUNICIPALITY, OR SPECIAL TAXING DI STRICT FAILED TO SUB MIT THE AUDIT
REPORT REQUIRED UNDE R THIS SECTION IN THE SAME FISCAL Y EAR IN WHICH IT
WAS DUE, THE DISCONTINUED FUN DS FOR THAT FISCAL YEAR SHALL REVERT TO Ch. 499 2024 LAWS OF MARYLAND
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THE GENERAL FUND OF THE STATE FOR DISCONTINUED DIS PARITY GRANTS AND TO
THE TRANSPORTATION TRUST FUND FOR DISCONTINUED HIGHWAY USER
REVENUES.
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall apply beginning
with the fiscal year 2024 audits that are required to be submitted under § 16–306 of the
Local Government Article.
SECTION 2. 3. AND BE IT FURTHER ENACTED, That this Act shall take effect
July 1, 2024.
Approved by the Governor, May 9, 2024.