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*sb0859*
SENATE BILL 859
P4, P1 6lr3597
By: Senator Hettleman (By Request – Joint Audit and Evaluation Committee)
Introduced and read first time: February 6, 2026
Assigned to: Budget and Taxation
Committee Report: Favorable with amendments
Senate action: Adopted
Read second time: March 3, 2026
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 retention; 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 to 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
for a certain report; requiring certain chief fin ancial officers to provide the General 15
Accounting Division of the Office of the Comptroller with certain information and a 16
certain letter; and generally relating to liquidated damages documentation 17
requirements and the chief financial officers of units in the Executive Branch of State 18
government. 19
BY repealing and reenacting, without amendments, 20
Article – State Finance and Procurement 21
Section 11–101(a), (d), and (aa) and 15–113(a) and (d) 22
Annotated Code of Maryland 23
(2021 Replacement Volume and 2025 Supplement) 24
2 SENATE BILL 859
BY repealing and reenacting, with amendments, 1
Article – State Finance and Procurement 2
Section 15–113(e) 3
Annotated Code of Maryland 4
(2021 Replacement Volume and 2025 Supplement) 5
BY repealing and reenacting, without amendments, 6
Article – State Personnel and Pensions 7
Section 1–101(a) and (b) 8
Annotated Code of Maryland 9
(2024 Replacement Volume and 2025 Supplement) 10
BY adding to 11
Article – State Personnel and Pensions 12
Section 2–206 and 2–207 13
Annotated Code of Maryland 14
(2024 Replacement Volume and 2025 Supplement) 15
SECTION 1. BE IT ENACTED BY THE GENERAL ASSEMBLY OF MARYLAND, 16
That the Laws of Maryland read as follows: 17
Article – State Finance and Procurement 18
11–101. 19
(a) In this Division II the following words have the meanings indicated unless: 20
(1) the context clearly requires a different meaning; or 21
(2) a different definition is provided for a particular title or provision. 22
(d) “Board” means the Board of Public Works. 23
(aa) (1) “Unit” means an officer or other entity that is in the Executive Branch 24
of the State government and is authorized by law to enter into a procurement contract. 25
(2) “Unit” does not include: 26
(i) a bistate, multistate, bicounty, or multicounty governmental 27
agency; or 28
(ii) a special tax district, sanitary district, drainage district, soil 29
conservation district, water supply district, or other political subdivision of the State. 30
15–113. 31
SENATE BILL 859 3
(a) In this section, “liquidated damages” means damages in an amount 1
designated by the parties to a contract th at the injured party is eligible to collect as 2
compensation for a specific breach of the contract. 3
(d) A unit shall obtain the approval of the head of the unit if the unit decides not 4
to include in a contract a liquidated damages clause specified under § 13–218(a)(4) of this 5
article. 6
(e) [(1) This subsection applies only to procurements valued at $5,000,000 or 7
more. 8
(2)] If a unit decides not to pursue liquidated damages when a specified 9
breach associated with a liquidated damages provision has occurred, the unit shall: 10
[(i)] (1) obtain the approval of the decision by the head of the unit; 11
[and] 12
[(ii)] (2) maintain documentation on the reason the unit decided 13
not to pursue liquidated damages; AND 14
(3) PROVIDE DOCUMENTATIO N TO THE BOARD AND THE JOINT 15
AUDIT AND EVALUATION COMMITTEE ON THE REAS ON THAT THE UNIT INT ENDS 16
NOT TO PURSUE LIQUIDATED DAMAGES. 17
Article – State Personnel and Pensions 18
1–101. 19
(a) In this Division I of this article the following words have the meanings 20
indicated. 21
(b) “Appointing authority” means an individual or a unit of government that has 22
the power to make appointments and terminate employment. 23
2–206. 24
(A) IN THIS SECTION, “CHIEF FINANCIAL OFFICER” INCLUDES MEANS: 25
(1) AN INDIVIDUAL ACTING AS CHIEF FINANCIAL OFFICER FOR A 26
PERIOD OF 3 MONTHS OR LONGER; AND 27
(2) A POSITION EQUIVALENT TO A CHIEF FINANCIAL OFFICER 28
4 SENATE BILL 859
(1) THE HIGHEST RANKING EXECUTIVE WHO , FOR A PERIOD OF AT 1
LEAST 6 MONTHS, IS RESPONSIBLE FOR D IRECTING ALL FINANCI AL OPERATIONS, 2
INCLUDING: 3
(I) BUDGETING; 4
(II) ACCOUNTING; 5
(III) PROCUREMENT; 6
(IV) GRANT MANAGEMENT; 7
(V) ESTABLISHING FISCAL POLICIES; 8
(VI) ENSURING COMPLIANCE WITH STATE AND FEDERAL 9
REGULATIONS; AND 10
(VII) PROVIDING STRATEGIC FINANCIAL LEADERSHIP TO 11
AGENCY LEADERSHIP; OR 12
(2) A POSITION WITH EQUIVALENT DUTIES. 13
(B) (1) THIS EXCEPT AS PROVIDED UN DER PARAGRAPH (2) OF THIS 14
SUBSECTION, THIS SECTION APPLIES TO A UNIT OF THE EXECUTIVE BRANCH OF 15
STATE GOVERNMENT THAT: 16
(1) (I) RECEIVES AT LEAST $2,000,000,000 $1,750,000,000 17
ANNUALLY IN STATE AND FEDERAL FUNDING; AND 18
(2) (II) EMPLOYS A CHIEF FINANCIAL OFFICER. 19
(2) THIS SECTION DOES NOT APPLY TO THE UNIVERSITY SYSTEM OF 20
MARYLAND. 21
(C) NOTWITHSTANDING ANY OTHER PROVISION OF LA W, AT THE REQUEST 22
OF AN APPOINTING AUTHORITY, THE SECRETARY MAY GRANT A N EXEMPTION TO 23
THE STATE PAY PLAN TO ASS IST UNITS OF STATE GOVERNMENT IN T HE 24
RECRUITMENT AND RETE NTION OF CHIEF FINAN CIAL OFFICERS THE SECRETARY 25
MAY SET THE PAY SCAL E FOR CHIEF FINANCIA L OFFICER POSITIONS IN ORDER TO 26
ASSIST WITH RECRUITMENT AND RETENTION. 27
(D) AN APPOINTING AUTHORITY SUBJECT TO THIS SECTION SHALL MAKE AN 28
APPOINTMENT OF A CHI EF FINANCIAL OFFICER WHO MEETS THE REQUIREMENTS 29
QUALIFICATIONS IN SUBSECTION (E) OF THIS SECTION. 30
SENATE BILL 859 5
(E) A CHIEF FINANCIA L OFFICER OF A UNIT OF STATE GOVERNMENT 1
SUBJECT TO THIS SECTION SHALL: 2
(1) (I) BE A CERTIFIED PUBLI C ACCOUNTANT WITH 5 YEARS OF 3
EXPERIENCE IN FISCAL MANAGEMENT IN THE PRIVATE OR PUBLIC SECTOR WITH A 4
MINIMUM OF 2 YEARS OF EXPERIENCE IN A HIGH –LEVEL MANAGEMENT POSITION; 5
OR 6
(II) POSSESS A MASTER ’S DEGREE IN BUSINESS 7
ADMINISTRATION, FINANCE, OR A RELATED FIELD F ROM AN ACCREDITED 8
INSTITUTION OF HIGHE R EDUCATION WITH 3 YEARS OF EXPERIENCE IN FISCAL 9
MANAGEMENT IN THE PRIVATE OR PUBLIC SECTOR WITH A MINIMUM OF 2 YEARS OF 10
EXPERIENCE IN A HIGH–LEVEL MANAGEMENT POSITION; OR 11
(2) HAVE A DOCUMENTED RECORD OF MANAGEMENT WITH AT LEAST 12
10 YEARS’ EXPERIENCE IN FISCAL MANAGEMENT IN THE PR IVATE OR PUBLIC 13
SECTOR, WITH A MINIMUM OF 5 YEARS OF EXPERIENCE IN A HIGH –LEVEL 14
MANAGEMENT POSITION. 15
(F) (1) A CHIEF FINANCIAL OFFICER OF A UNIT OF STATE GOVERNMENT 16
SUBJECT TO THIS SECTION SHALL PROVIDE TO THE OFFICE OF THE COMPTROLLER 17
FOR THE ANNUAL COMPREHENSIVE FINANCIAL REPORT, REQUIRED UNDER § 18
2–102 OF THE STATE FINANCE AND PROCUREMENT ARTICLE, ALL NECESSARY 19
ENTRIES OF THE UNIT ’S FINANCIAL INFORMAT ION AT THE CLOSE OF THE FISCAL 20
YEAR. 21
(2) THE CHIEF FINANCIAL O FFICER THAT REPORTS TO THE 22
COMPTROLLER UNDER PARAGRAPH (1) OF THIS SUBSECTION SHALL: 23
(I) ENSURE THAT EACH ENT RY IN THE UNIT ’S FINANCIAL 24
INFORMATION IS ADEQUATE AND ACCURATELY RECORDED; AND 25
(II) CERTIFY TO THE COMPTROLLER THE ADEQU ACY AND 26
ACCURACY OF THE FINANCIAL INFORMATION WITH A STATEMENT THAT: 27
1. ALL FEDERAL FUND REC EIVABLES ARE PROPERL Y 28
SUPPORTED AND CAN BE DIRECTLY ASSOCIAT ED WITH A SPECIFIC F EDERAL 29
FUNDING STREAM; AND 30
2. THE STATE CAN REASONABLY EXPECT TO RECEIVE 31
FUNDS WITHIN 60 DAYS FOR THE SUBSEQU ENT FISCAL YEAR UNLE SS SPECIFIC 32
FEDERAL LANGUAGE ALLOWS FOR A LONGER RECOVERY PERIOD. 33
6 SENATE BILL 859
(3) IN ADDITION TO THE REQUIREMENTS SPECIFIED IN PARAGRAPHS 1
(1) AND (2) OF THIS SUBSECTION, THE CHIEF FINANCIAL OFFICER SHALL PROVIDE 2
TO THE GENERAL ACCOUNTING DIVISION OF THE OFFICE OF THE COMPTROLLER: 3
(I) THE INFORMATION NECESSARY TO PREPARE THE ANNUAL 4
COMPREHENSIVE FINANCIAL REPORT AND SCHEDULE OF EXPENDITURES OF 5
FEDERAL AWARDS; AND 6
(II) A LETTER ATTESTING T O THE ACCURACY AND 7
COMPLETENESS OF THE INFORMATION PROVIDED UNDER ITEM (I) OF THIS 8
PARAGRAPH. 9
(E) (1) THE SECRETARY SHALL ESTAB LISH MINIMUM QUALIFICATIONS 10
FOR CHIEF FINANCIAL OFFICER POSITIONS THAT CONSIDER: 11
(I) EDUCATION; 12
(II) EXECUTIVE EXPERIENCE AND THE DURATION OF THAT 13
EXPERIENCE; 14
(III) SUPERVISORY OR MANAGERIAL EXPERIENCE; 15
(IV) TECHNICAL COMPETENCE; 16
(V) CERTIFICATIONS; 17
(VI) SCOPE AND COMPLEXITY OF THE ROLE; AND 18
(VII) ALIGNMENT WITH THE G OVERNMENT OR INDUSTR Y 19
STANDARDS. 20
(2) ON OR BEFORE NOVEMBER 1, 2026, THE DEPARTMENT SHALL 21
ADOPT REGULATIONS TO ESTABLISH MINIMUM QU ALIFICATIONS FOR CHI EF 22
FINANCIAL OFFICER POSITIONS. 23
(F) FOR PREPARATION OF TH E ANNUAL COMPREHENSIVE FINANCIAL 24
REPORT REQUIRED UNDER § 2–102 OF THE STATE FINANCE AND PROCUREMENT 25
ARTICLE, A CHIEF FINANCIAL OFFICER OF A UNIT OF STATE GOVERNMENT SUBJECT 26
TO THIS SECTION SHAL L PROVIDE TO THE OFFICE OF THE COMPTROLLER AT THE 27
CLOSE OF THE FISCAL YEAR: 28
(1) ALL NECESSARY ENTRIE S OF THE UNIT ’S FINANCIAL 29
INFORMATION; 30
SENATE BILL 859 7
(2) THE INFORMATION NECE SSARY TO PREPARE THE SCHEDULE OF 1
EXPENDITURES OF FEDERAL AWARDS IN ACCORDANCE WITH APPLICABLE FEDERAL 2
LAWS AND REGULATIONS; AND 3
(3) A LETTER ATTESTING TO THE ACCURACY AND COMPLETENESS OF 4
THE INFORMATION PROVIDED IN ITEMS (1) AND (2) OF THIS SUBSECTION. 5
2–207. 6
(A) IN THIS SECTION, “CHIEF INFORMATION OFFICER” MEANS: 7
(1) AN INDIVIDUAL ACTING AS THE SENIOR EXE CUTIVE OFFICER 8
RESPONSIBLE FOR THE STRATEGIC PLANNING, MANAGEMENT, AND OVERSIGHT OF 9
AN AGENCY ’S INFORMATION TECHNO LOGY AND COMPUTER SY STEMS AND 10
SUPPORTING ITS MISSION AND GOALS, INCLUDING THROUGH: 11
(I) PROCUREMENT; 12
(II) COMPLIANCE WITH STATE AND FEDERAL REG ULATIONS; 13
AND 14
(III) PROVIDING INFORMATIO N TECHNOLOGY LEADERS HIP TO 15
AGENCY LEADERSHIP; OR 16
(2) A POSITION WITH EQUIVALENT DUTIES. 17
(B) (1) EXCEPT AS PROVIDED UN DER PARAGRAPH (2) OF THIS 18
SUBSECTION, THIS SECTION A PPLIES TO A UNIT OF THE EXECUTIVE BRANCH OF 19
STATE GOVERNMENT THAT EMPLOYS A CHIEF INFORMATION OFFICER. 20
(2) THIS SECTION DOES NOT APPLY TO THE UNIVERSITY SYSTEM OF 21
MARYLAND. 22
(C) NOTWITHSTANDING ANY O THER PROVISION OF LA W, THE SECRETARY 23
MAY SET THE PAY SCALE FOR CHIEF INFO RMATION OFFICER POSITIONS IN ORDER 24
TO ASSIST WITH RECRUITMENT AND RETENTION. 25
SECTION 2. AND BE IT FURTHER ENACTED, That this Act shall take effect July 26
1, 2026. 27