Maryland 2025 Regular Session

Maryland House Bill HB507 Compare Versions

Version 1 (Old)

Version 2 (New)

Old	New		Differences
1	1
2	2
3	3		EXPLANATION: CAPITALS INDICATE MAT TER ADDED TO EXISTIN G LAW.
4	4		[Brackets] indicate matter deleted from existing law.
5		-	Underlining indicates amendments to bill.
6		-	Strike out indicates matter stricken from the bill by amendment or deleted from the law by
7		-	amendment.
8	5		hb0507
9	6
10	7		HOUSE BILL 507
11	8		P2 5lr3083
12		-	~~CF SB 453~~
	9	+
13	10		By: Delegate Kerr
14	11		Introduced and read first time: January 22, 2025
15	12		Assigned to: Health and Government Operations
16		-	Committee Report: Favorable
17		-	House action: Adopted
18		-	Read second time: February 25, 2025
19	13
20		-	~~CHAPTER ______~~
	14	+	A BILL ENTITLED
21	15
22	16		AN ACT concerning 1
23	17
24	18		State Contracts – Prohibited Provisions 2
25	19
26	20		FOR the purpose of clarifying a prohibition on including in State contracts provisions 3
27	21		pertaining to limitations of liability for damage to certain property; clarifying a 4
28	22		prohibition on including in State contracts provisions limiting the recovery of costs 5
29	23		related to the use of replacement contractors under certain circumstances; and 6
30	24		generally relating to prohibited provisions in State contracts. 7
31	25
32	26		BY repealing and reenacting, with amendments, 8
33	27		Article – State Finance and Procurement 9
34	28		Section 2–901 10
35	29		Annotated Code of Maryland 11
36	30		(2021 Replacement Volume and 2024 Supplement) 12
37	31
38	32		SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 13
39	33		That the Laws of Maryland read as follows: 14
40	34
41	35		Article – State Finance and Procurement 15
42	36
43	37		2–901. 16
44	38
45	39		(a) In this section, “State contract” means any agreement entered into by the 17
46	40		State. 18
	41	+
	42	+	(a–1) This section does not apply to a State contract relating to the purchase, 19
	43	+	redevelopment, or operation of a racing facility or training facility site as those terms are 20
	44	+	defined under § 10–601 of the Economic Development Article. 21
	45	+
	46	+	(b) Except as required by State or federal law, a State contract may not include: 22
47	47		2 HOUSE BILL 507
48	48
49	49
50		-	(a–1) This section does not apply to a State contract relating to the purchase, 1
51		-	redevelopment, or operation of a racing facility or training facility site as those terms are 2
52		-	defined under § 10–601 of the Economic Development Article. 3
	50	+	(1) a provision that requires the State to indemnify, defend, or hold 1
	51	+	harmless another person without an appropriation of State funds for that purpose; 2
53	52
54		-	(b) Except as required by State or federal law, a State contract may not include: 4
	53	+	(2) a provision by which the State agrees to binding arbitration or any 3
	54	+	other binding extrajudicial dispute resolution process; 4
55	55
56		-	(1) a provision that ~~requires the State to indemnify, defend,~~ or ~~hold~~ 5
57		-	~~harmless another person without an appropriation~~ of State ~~funds for that purpose~~; 6
	56	+	(3) a provision that names a jurisdiction or venue for any action or dispute 5
	57	+	against the State other than a court of proper jurisdiction in the State; 6
58	58
59		-	(2) a provision by which the State agrees to binding arbitration or any 7
60		-	other binding extrajudicial dispute resolution process; 8
	59	+	(4) a provision that requires the State to agree to limit the liability for any 7
	60	+	direct loss to the State for bodily injury, death, or damage to REAL PROPERTY OR 8
	61	+	TANGIBLE PERSONAL property of the State caused by the negligence, intentional or willful 9
	62	+	misconduct, fraudulent act, recklessness, or other tortious conduct of a person or a person’s 10
	63	+	employees or agents or a provision that would otherwise impose an indemnification 11
	64	+	obligation on the State; 12
61	65
62		-	(3) a provision that ~~names~~ a ~~jurisdiction~~ or ~~venue for any action or dispute 9~~
63		-	~~against the State other than a court of proper jurisdiction in the State; 10~~
	66	+	(5) a provision that requires the State to be bound by a term or condition 13
	67	+	that: 14
64	68
65		-	(4) a provision that requires the State to agree to limit the liability for any 11
66		-	direct loss to the State for bodily injury, death, or damage to REAL PROPERTY OR 12
67		-	TANGIBLE PERSONAL property of the State caused by the negligence, intentional or willful 13
68		-	misconduct, fraudulent act, recklessness, or other tortious conduct of a person or a person’s 14
69		-	employees or agents or a provision that would otherwise impose an indemnification 15
70		-	obligation on the State; 16
	69	+	(i) is unknown to the State at the time of signing a contract; 15
71	70
72		-	(5) a provision that requires the State to be bound by a term or condition 17
73		-	that: 18
	71	+	(ii) may be unilaterally changed by the other party; or 16
74	72
75		-	(i) is ~~unknown to the~~ State ~~at the time of signing a contract~~; 19
	73	+	(iii) is electronically accepted by a State employee without authority; 17
76	74
77		-	(ii) may be unilaterally changed by the other party; or 20
	75	+	(6) a provision that provides for a person other than the Attorney General 18
	76	+	of Maryland to serve as legal counsel for the State, unless provided under § 6–106 of the 19
	77	+	State Government Article; 20
78	78
79		-	(iii) is electronically accepted by a State employee without authority; 21
	79	+	(7) a provision that is inconsistent with the State’s obligations under Title 21
	80	+	3 or 4 of the General Provisions Article; 22
80	81
81		-	(6) a provision that provides for a person other than the Attorney General 22
82		-	of Maryland to serve as legal counsel for the State, unless provided under § 6–106 of the 23
83		-	State Government Article; 24
	82	+	(8) a provision prohibited under § 7–237 of this article; 23
84	83
85		-	(7) a provision that ~~is inconsistent with~~ the State~~’s obligations under Title 25~~
86		-	3 or ~~4 of the General Provisions Article; 26~~
	84	+	(9) a provision for automatic renewal that obligates the State to allocate 24
	85	+	funding in subsequent fiscal years; or 25
87	86
88		-	(8) a provision prohibited under § 7–237 of this article; 27
89		-
90		-	(9) a provision for automatic renewal that obligates the State to allocate 28
91		-	funding in subsequent fiscal years; or 29
92		-
93		-	(10) a provision that limits the State’s ability to recover the DIFFERENCE 30
94		-	IN THE cost of a replacement contractor TO PERFORM THE SERVI CES NOT PERFORMED 31
95		-	BY THE ORIGINAL CONT RACTOR, TO THE EXTENT THAT T HE SUM OF THE AMOUNT 32 HOUSE BILL 507 3
	87	+	(10) a provision that limits the State’s ability to recover the DIFFERENCE 26
	88	+	IN THE cost of a replacement contractor TO PERFORM THE SERVI CES NOT PERFORMED 27
	89	+	BY THE ORIGINAL CONT RACTOR, TO THE EXTENT THAT T HE SUM OF THE AMOUNT 28
	90	+	PAID TO THE REPLACEM ENT CONTRACTOR AND T HE AMOUNT PAID TO TH E 29
	91	+	ORIGINAL CONTRACTOR EXCEED THE COSTS PRO VIDED FOR IN THE CON TRACT WITH 30
	92	+	THE ORIGINAL CONTRAC TOR. 31
	93	+	HOUSE BILL 507 3
96	94
97	95
98		-	~~PAID TO THE REPLACEM ENT CONTRACTOR AND T HE AMOUNT PAID TO TH E~~ 1
99		-	~~ORIGINAL CONTRACTOR EXCEED~~ THE ~~COSTS PRO VIDED FOR IN~~ THE CONTRACT ~~WITH~~ 2
100		-	THE ~~ORIGINAL CONTRAC TOR~~. 3
	96	+	(c) If a State contract contains a provision listed under subsection (b) of this 1
	97	+	section, the provision is void ab initio and the contract containing that provision shall be 2
	98	+	enforceable as if it did not contain the provision. 3
101	99
102		-	(c) If a State contract contains a provision listed under subsection (b) of this 4
103		-	section~~, the provision is void ab initio and the contract containing that provision~~ shall be 5
104		-	~~enforceable as if it did not contain~~ the ~~provision~~. 6
	100	+	(d) A State contract that contains a provision listed under subsection (b) of this 4
	101	+	section shall be governed by and construed in accordance with State law, notwithstanding 5
	102	+	any term or condition to the contrary in the contract. 6
105	103
106		-	(d) A State contract that contains a provision listed under subsection (b) of this 7
107		-	section shall be governed by and construed in accordance with State law, notwithstanding 8
108		-	any term or condition to the contrary in the contract. 9
	104	+	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 7
	105	+	October 1, 2025. 8
109	106
110		-	SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect 10
111		-	October 1, 2025. 11
112		-
113		-
114		-
115		-
116		-	Approved:
117		-	________________________________________________________________________________
118		-	Governor.
119		-	________________________________________________________________________________
120		-	Speaker of the House of Delegates.
121		-	________________________________________________________________________________
122		-	President of the Senate.