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*hb1422*
HOUSE BILL 1422
P4, P1 (6lr2544)
ENROLLED BILL
— Government, Labor, and Elections/Budget and Taxation —
Introduced by Delegate Solomon (By Request – Joint Audit and Evaluation
Committee)
Read and Examined by Proofreaders:
_______________________________________________
Proofreader.
_______________________________________________
Proofreader.
Sealed with the Great Seal and presented to the Governor, for his appro val this
_______ day of _______________ at ________________________ o’clock, ________M.
______________________________________________
Speaker.
CHAPTER ______
AN ACT concerning 1
State Procurement and Personnel – Liquidated Damages Documentation 2
Requirements and State Fiscal Leadership Capacity 3
FOR the purpose of requiring units of State government to provide certain documentation 4
to the Board of Public Works and the Joint Audit and Evaluation Committee if the 5
unit decides not to pursue certain liquidated damages; authorizing the Secretary of 6
Budget and Management to grant a certain exemption to the State pay plan under 7
certain circumstances set the pay scale for certain chief financial officer positions in 8
order to assist with recruitment and r etention; requiring certain appointing 9
authorities to select the Secretary to establish certain minimum qualifications for 10
chief financial officers that meet consider certain requirements; qualifications; 11
requiring the Department of Budget and Management t o adopt certain regulations 12
on or before a certain date; requiring certain chief financial officers to provide to the 13
Office of the Comptroller certain financial information at the close of the fiscal year 14
2 HOUSE BILL 1422
for a certain report; requiring certain chief fina ncial officers to provide the General 1
Accounting Division of the Office of the Comptroller with certain information and a 2
certain letter; requiring certain units of State government to liquidated damages 3
documentation requirements and take certain actions if the unit does not intend to 4
pursue certain damages; and generally relating to liquidated damages 5
documentation requirements and the chief financial officers of units in the Executive 6
Branch of State government. 7
BY repealing and reenacting, without amendments, 8
Article – State Finance and Procurement 9
Section 11–101(a), (d), and (aa) and 15–113(a) and (d) 10
Annotated Code of Maryland 11
(2021 Replacement Volume and 2025 Supplement) 12
BY repealing and reenacting, with amendments, 13
Article – State Finance and Procurement 14
Section 15–113(e) 15
Annotated Code of Maryland 16
(2021 Replacement Volume and 2025 Supplement) 17
BY repealing and reenacting, without amendments, 18
Article – State Personnel and Pensions 19
Section 1–101(a) and (b) 20
Annotated Code of Maryland 21
(2024 Replacement Volume and 2025 Supplement) 22
BY adding to 23
Article – State Personnel and Pensions 24
Section 2–206 and 2–207 25
Annotated Code of Maryland 26
(2024 Replacement Volume and 2025 Supplement) 27
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 28
That the Laws of Maryland read as follows: 29
Article – State Finance and Procurement 30
11–101. 31
(a) In this Division II the following words have the meanings indicated unless: 32
(1) the context clearly requires a different meaning; or 33
(2) a different definition is provided for a particular title or provision. 34
(d) “Board” means the Board of Public Works. 35
HOUSE BILL 1422 3
(aa) (1) “Unit” means an officer or other entity that is in the Executive Branch 1
of the State government and is authorized by law to enter into a procurement contract. 2
(2) “Unit” does not include: 3
(i) a bistate, multistate, bicounty, or multicounty governmental 4
agency; or 5
(ii) a special tax district, sanitary district, drainage district, soil 6
conservation district, water supply district, or other political subdivision of the State. 7
15–113. 8
(a) In this section, “liquidated damages” means damages in an amount 9
designated by the parties to a contract that the injured party is eligible to collect as 10
compensation for a specific breach of the contract. 11
(d) A unit shall obtain the approval of the head of the unit if the unit decides not 12
to include in a contract a liquidated damages clause specified under § 13 –218(a)(4) of this 13
article. 14
(e) [(1) This subsection applies only to procurements va lued at $5,000,000 or 15
more. 16
(2)] If a unit decides not to pursue liquidated damages when a specified 17
breach associated with a liquidated damages provision has occurred, the unit shall: 18
[(i)] (1) obtain the approval of the decision by the head of the unit; 19
[and] 20
[(ii)] (2) maintain documentation on the reason the unit decided 21
not to pursue liquidated damages; AND 22
(3) PROVIDE DOCUMENTATIO N TO THE BOARD AND THE JOINT 23
AUDIT AND EVALUATION COMMITTEE ON THE REAS ON THAT THE UNIT INT ENDS 24
NOT TO PURSUE LIQUIDATED DAMAGES. 25
Article – State Personnel and Pensions 26
1–101. 27
(a) In this Division I of this article the following words have the meanings 28
indicated. 29
(b) “Appointing authority” means an individual or a unit of government that has 30
the power to make appointments and terminate employment. 31
4 HOUSE BILL 1422
2–206. 1
(A) IN THIS SECTION, “CHIEF FINANCIAL OFFICER” INCLUDES MEANS: 2
(1) AN INDIVIDUAL ACTING AS CHIEF FINANCIAL O FFICER FOR A 3
PERIOD OF 3 MONTHS OR LONGER; AND 4
(2) A POSITION EQUIVALENT TO A CHIEF FINANCIAL OFFICER 5
(1) THE HIGHEST RANKING EXECUTIVE WHO , FOR A PERIOD OF AT 6
LEAST 6 MONTHS, IS RESPONSIBLE FOR D IRECTING ALL FINANCI AL OPERATIONS, 7
INCLUDING: 8
(I) BUDGETING; 9
(II) ACCOUNTING; 10
(III) PROCUREMENT; 11
(IV) GRANT MANAGEMENT; 12
(V) ESTABLISHING FISCAL POLICIES; 13
(VI) ENSURING COMPLIANCE WITH STATE AND FEDERAL 14
REGULATIONS; AND 15
(VII) PROVIDING STRATEGIC FINANCIAL LEADERSHIP TO 16
AGENCY LEADERSHIP; OR 17
(2) A POSITION WITH EQUIVALENT DUTIES. 18
(B) (1) THIS EXCEPT AS PROVIDED UNDER PARAGRAPH (2) OF THIS 19
SUBSECTION, THIS SECTION APPLIES TO A UNIT OF THE EXECUTIVE BRANCH OF 20
STATE GOVERNMENT THAT: 21
(1) (I) RECEIVES AT LEAST $2,000,000,000 $1,750,000,000 22
ANNUALLY IN STATE AND FEDERAL FUNDING; AND 23
(2) (II) EMPLOYS A CHIEF FINANCIAL OFFICER. 24
(2) THIS SECTION DOES NOT APPLY TO THE UNIVERSITY SYSTEM OF 25
MARYLAND. 26
HOUSE BILL 1422 5
(C) NOTWITHSTANDING ANY OTHER PROVISION OF LA W, AT THE REQUEST 1
OF AN APPOINTING AUT HORITY, THE SECRETARY MAY GRANT A N EXEMPTION TO 2
THE STATE PAY PLAN TO ASS IST UNITS OF STATE GOVERNMENT IN T HE 3
RECRUITMENT AND RETE NTION OF CHIEF FINAN CIAL OFFICERS THE SECRETARY 4
MAY SET THE PAY SCAL E FOR CHIEF FINANCIA L OFFICER POSITIONS IN ORDER TO 5
ASSIST WITH RECRUITMENT AND RETENTION. 6
(D) AN APPOINTING AUTHORITY SUBJECT TO THIS SECTION SHALL MAKE AN 7
APPOINTMENT OF A CHI EF FINANCIAL OFFICER WHO MEETS THE REQUIREMENTS 8
QUALIFICATIONS IN SUBSECTION (E) OF THIS SECTION. 9
(E) A CHIEF FINANCIAL OFFI CER OF A UNIT OF STATE GOVERNMENT 10
SUBJECT TO THIS SECTION SHALL: 11
(1) (I) BE A CERTIFIED PUBLIC ACCOUNTANT WI TH 5 YEARS OF 12
EXPERIENCE IN FISCAL MANAGEMENT IN THE PRIVATE OR PUBLIC SECTOR WITH A 13
MINIMUM OF 2 YEARS OF EXPERIENCE IN A HIGH –LEVEL MANAGEMENT POSITION; 14
OR 15
(II) POSSESS A MASTER ’S DEGREE IN BUSINESS 16
ADMINISTRATION, FINANCE, OR A R ELATED FIELD FROM AN ACCREDITED 17
INSTITUTION OF HIGHE R EDUCATION WITH 3 YEARS OF EXPERIENCE IN FISCAL 18
MANAGEMENT IN THE PRIVATE OR PUBLIC SECTOR WITH A MINIMUM OF 2 YEARS OF 19
EXPERIENCE IN A HIGH–LEVEL MANAGEMENT POSITION; OR 20
(2) HAVE A DOCUMENTED RECORD OF MANAGEMENT WITH AT LEAST 21
10 YEARS’ EXPERIENCE IN FISCAL MANAGEMENT IN THE PR IVATE OR PUBLIC 22
SECTOR, WITH A MINIMUM OF 5 YEARS OF EXPERIENCE IN A HIGH –LEVEL 23
MANAGEMENT POSITION. 24
(F) (1) A CHIEF FINANCIAL OFFICER OF A UNIT OF STATE GOVERNMENT 25
SUBJECT TO THIS SECTION SHALL PROVIDE TO THE OFFICE OF THE COMPTROLLER 26
FOR THE ANNUAL COMPREHENSIVE FINANCIAL REPORT, REQUIRED UNDER § 27
2–102 OF THE STATE FINANCE AND PROCUREMENT ARTICLE, ALL NECESSAR Y 28
ENTRIES OF THE UNIT ’S FINANCIAL INFORMAT ION AT THE CLOSE OF THE FISCAL 29
YEAR. 30
(2) THE CHIEF FINANCIAL O FFICER THAT REPORTS TO THE 31
COMPTROLLER UNDER PARAGRAPH (1) OF THIS SUBSECTION SHALL: 32
(I) ENSURE THAT EACH ENT RY IN THE UNIT ’S FINANCIAL 33
INFORMATION IS ADEQUATE AND ACCURATELY RECORDED; AND 34
6 HOUSE BILL 1422
(II) CERTIFY TO THE COMPTROLLER THE ADEQU ACY AND 1
ACCURACY OF THE FINANCIAL INFORMATION WITH A STATEMENT THAT: 2
1. ALL FEDERAL FUND REC EIVABLES ARE PROPERL Y 3
SUPPORTED AND CAN BE DIRECTLY ASSOCIATED WITH A SPECIFIC FEDERAL 4
FUNDING STREAM; AND 5
2. THE STATE CAN REASONABLY EXPECT TO RECEIVE 6
FUNDS WITHIN 60 DAYS FOR THE SUBSEQU ENT FISCAL YEAR UNLE SS SPECIFIC 7
FEDERAL LANGUAGE ALLOWS FOR A LONGER RECOVERY PERIOD. 8
(3) IN ADDITION TO THE REQUIREMENTS SPECIFIED IN PARAGRAPHS 9
(1) AND (2) OF THIS SUBSECTION, THE CHIEF FINANCIAL OFFICER SHALL PROVIDE 10
TO THE GENERAL ACCOUNTING DIVISION OF THE OFFICE OF THE COMPTROLLER: 11
(I) THE INFORMATION NECESSARY TO PREPARE THE ANNUAL 12
COMPREHENSIVE FINANCIAL REPORT AN D SCHEDULE OF EXPENDITURES OF 13
FEDERAL AWARDS; AND 14
(II) A LETTER ATTESTING T O THE ACCURACY AND 15
COMPLETENESS OF THE INFORMATION PROVIDED UNDER ITEM (I) OF THIS 16
PARAGRAPH. 17
(G) FOR A UNIT OF STATE GOVERNMENT SUBJECT TO THIS SECTION WITH A 18
PROCUREMENT CON TRACT CONTAINING LIQ UIDATED DAMAGE PROVI SIONS IN 19
WHICH THE UNIT INTENDS NOT TO PURSUE LIQUIDATED DAMAGES IN THE EVENT OF 20
BREACH, THE CHIEF FINANCIAL OFFICER SHALL: 21
(1) PROVIDE DOCUMENTATION TO THE BOARD OF PUBLIC WORKS ON 22
THE REASON THAT THE UNIT INTENDS NOT TO PURSUE LIQUIDATED DAMAGES; AND 23
(2) OBTAIN APPROVAL FROM THE BOARD OF PUBLIC WORKS IF THE 24
UNIT DOES NOT SEEK LIQUIDATED DAMAGES. 25
(E) (1) THE SECRETARY SHALL ESTAB LISH MINIMUM QUALIFI CATIONS 26
FOR CHIEF FINANCIAL OFFICER POSITIONS THAT CONSIDER: 27
(I) EDUCATION; 28
(II) EXECUTIVE EXPERIENCE AND THE DURATION OF THAT 29
EXPERIENCE; 30
(III) SUPERVISORY OR MANAGERIAL EXPERIENCE; 31
HOUSE BILL 1422 7
(IV) TECHNICAL COMPETENCE; 1
(V) CERTIFICATIONS; 2
(VI) SCOPE AND COMPLEXITY OF THE ROLE; AND 3
(VII) ALIGNMENT WITH THE GOVERNMENT OR INDUSTRY 4
STANDARDS. 5
(2) ON OR BEFORE NOVEMBER 1, 2026, THE DEPARTMENT SHALL 6
ADOPT REGULATIONS TO ESTABLISH MINIMUM QU ALIFICATIONS FOR CHI EF 7
FINANCIAL OFFICER POSITIONS. 8
(F) FOR PREPARATION OF TH E ANNUAL COMPREHENSIVE FINANCIAL 9
REPORT REQUIRED UNDER § 2–102 OF THE STATE FINANCE AND PROCUREMENT 10
ARTICLE, A CHIEF FINANCIAL OFFICER OF A UNIT OF STATE GOVERNMENT SUBJECT 11
TO THIS SECTION SHAL L PROVIDE TO THE OFFICE OF THE COMPTROLLER AT THE 12
CLOSE OF THE FISCAL YEAR: 13
(1) ALL NECESSARY ENTRIES OF THE UNIT ’S FINANCIAL 14
INFORMATION; 15
(2) THE INFORMATION NECE SSARY TO PREPARE THE SCHEDULE OF 16
EXPENDITURES OF FEDERAL AWARDS IN ACCORDANCE WITH APPLICABLE FEDERAL 17
LAWS AND REGULATIONS; AND 18
(3) A LETTER ATTESTING TO THE ACCURACY AND COMPLETENESS OF 19
THE INFORMATION PROVIDED IN ITEMS (1) AND (2) OF THIS SUBSECTION. 20
2–207. 21
(A) IN THIS SECTION, “CHIEF INFORMATION OFFICER” MEANS: 22
(1) AN INDIVIDUAL ACTING AS THE SENIOR EXECUT IVE OFFICER 23
RESPONSIBLE FOR THE STRATEGIC PLANNING, MANAGEMENT, AND OVERSIGHT OF 24
AN AGENCY ’S INFORMATION TECHNO LOGY AND COMPUTER SY STEMS AND 25
SUPPORTING ITS MISSION AND GOALS, INCLUDING THROUGH: 26
(I) PROCUREMENT; 27
(II) COMPLIANCE WITH STATE AND FEDERAL REG ULATIONS; 28
AND 29
8 HOUSE BILL 1422
(III) PROVIDING INFORMATIO N TECHNOLOGY LEADERSHI P TO 1
AGENCY LEADERSHIP; OR 2
(2) A POSITION WITH EQUIVALENT DUTIES. 3
(B) (1) EXCEPT AS PROVIDED UN DER PARAGRAPH (2) OF THIS 4
SUBSECTION, THIS SECTION APPLIES TO A UNIT OF THE EXECUTIVE BRANCH OF 5
STATE GOVERNMENT THAT EMPLOYS A CHIEF INFORMATION OFFICER. 6
(2) THIS SECTION DOES NOT APPLY TO THE UNIVERSITY SYSTEM OF 7
MARYLAND. 8
(C) NOTWITHSTANDING ANY O THER PROVISION OF LA W, THE SECRETARY 9
MAY SET THE PAY SCAL E FOR CHIEF INFORMAT ION OFFICER POSITIONS IN ORDER 10
TO ASSIST WITH RECRUITMENT AND RETENTION. 11
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 12
1, 2026. 13
Approved:
________________________________________________________________________________
Governor.
________________________________________________________________________________
Speaker of the House of Delegates.
________________________________________________________________________________
President of the Senate.