Happy end of session 2016!
Sine Die (the last day of the General Assembly) ended at midnight on April 11.
Thanks to each and every one of you for your work in protecting Maryland consumers! With your help, MCRC passed 10 of our priority pieces of legislation that help Maryland families build assets and protect themselves from predatory financial products.
A few highlights of the session include:
- For Profit Schools – HB741/SB427
This legislation will create stronger consumer protections and provide greater transparency for the 30,000 students attending for-profit and private career schools in Maryland. MCRC’s research found that these schools had tended to cost more, lead to higher debt and loans for students, and have lower completion and employment rates. Read our report and a Washington Post article about the legislation. The legislation creates a Guaranty Fund for students attending for profit schools and states that students at for-profit and private career schools can receive a full refund in the event of a school closure, receive refunds of tuition and fees if the school does not perform its contract faithfully. The legislation streamlines the process for providing a refund. The legislation also prohibits schools from enrolling students if completion of the program does not meet the state licensing and certification requirements or if the student cannot receive licensure or certification in the program. Finally, the legislation increase transparency by requiring schools to post the net price calculator (to determine costs) in a conspicuous on its website and to provide students with the CFPB’s Financial Aid Shopping sheet. Many thanks to the leadership of the bills’ sponsors Senator Paul Pinsky and Delegate Dana Stein for championing this important legislation.
- Income Tax Subtraction-College Savings Plans – HB335
This bill will create an income tax subtraction for contributions to college savings accounts in Maryland. With the rising cost of tuition, encouraging students and families to plan ahead for expensive degrees and training programs is becoming increasingly critical. This offer support to future students and the families of students saving money for higher education in the form of a income tax subtraction. Thanks to Delegate Brooke Lierman for her leadership on this effort.
Homeownership and Affordable Housing
- Homeowners Tax Credit – HB378/SB322
This legislation will require the State Department of Assessments and Taxation and the Comptroller to coordinate in order to reach potentially eligible homeowners to inform them of the Homeowner’s Property Tax Credit. The credit is available to homeowners whose homes are valued at $300,000 or less and whose household income is $60,000 or less. The credit will cap one’s property tax on a sliding scale based on income. Many homeowners have saved more than $1000 by taking advantage of the Homeowner’s Tax Credit but few know of the credit. Analysis in Baltimore City has shown that only 10% of potentially eligible homeowners take advantage of this credit. Thanks to Senator Paul Pinsky and Delegate Jimmy Tarlau for shepherding this important legislation through to passage.
- Rental Property Tax Relief Credit – HB340
This legislation increases the property tax relief an renter can receive from $750 to $1000 for the Renters Property Tax Relief Program. The legislation also changes in terms of what is excluded when calculating the relief and what percentage is taxed. In 2016, the legislation will provide an estimated $302 in additional relief to more than 8,900 renters. Thanks to Delegate Jimmy Tarlau for his leadership on this critical issue-particularly important as more working families are spending more than 30% of their budget to rent a house or apartment.
Affordable Auto Insurance
The high cost of auto insurance drives many consumers out of the market and leads to 15% of Maryland drivers who are on the roads without insurance. Maryland’s limited liability insurance is 30/60 which is one of the more expensive in the region. In addition, the use of non driving factors such as zip code, education, marital status, homeownership status, and occupation increase the costs of car insurance for drivers who live in certain zip codes or are single or widowed. This year, two innovative pieces of legislation passed which will reduce the costs of insurance for low-income drivers. Thanks to the bill sponsors, Senator Thomas (Mac) Middleton and Delegate Bill Frick for their leadership and commitment to reducing the burden of high-priced car insurance for low-income drivers.
- Personal Injury Protection – SB784/HB900
Maryland is one of the few states that mandates that drivers buy full or limited personal injury protection (PIP) coverage. This legislation will allow low-income drivers who have limited liability coverage to waive PIP coverage. Low-income drivers in Baltimore City who waive PIP are likely to save between $213-$527 per year.
- Program to Incentivize Insurance – SB888/HB912
This legislation creates an innovative auto insurance amnesty program. The program creates a 90 day period where MVA must (1) waive 80% of a vehicle owner’s delinquent uninsured vehicle penalties that became delinquent before January 1, 2014, and (2) require those vehicle owners to purchase and maintain the required security for their vehicles. This legislation removes one of the economic barriers to purchasing car insurance once the insurance has lapsed. Traditionally once insurance has lapsed, a driver would have to pay the fines and then pay the cost for new insurance (which is higher due to the gap in coverage).
These bills are important first steps in reducing the high costs of auto insurance in Maryland. We look forward to working with the bill sponsors to find additional ways to reduce the cost of insurance in Maryland.
Other Consumer Protections
- Debt Buyers – SB771
SB 771 bars collection actions after the statute of limitations has expired, and requires that third-party debt buyers must present certain documents to obtain a court-ordered collection action, including evidence of the agreement between the original creditor and debtor and documents establishing the debt buyer’s ownership of the account, among other things. Thanks to Attorney General Frosh for his leadership on these issues.
- Structured Settlements – HB535/SB734
The bill creates important new safeguards for injured Marylanders who face possible exploitation when offered immediate cash in exchange for a stream of payments obtained through the settlement of a personal injury lawsuit.The legislation requires that victims receive independent advice on whether a proposed transfer is in their best interests; requires that courts find that the transfer is in the best interest of the injured person, taking into account the welfare of dependents, and that the financial terms are fair and reasonable; requires that applications for transfers be filed in the circuit court in the county in which the injured person resides; creates a new registration requirement for factoring companies, and authorizes the Office of the Attorney General to discipline companies engaging in prohibited practices such as making gifts or extending loans to entice customers; offering referral fees; or using harassing marketing. Thanks to Attorney General Frosh for his leadership on this critical issue.
- Senior Citizens Operating Fund – HB262
This legislation increases the amount of funding required to be included in the annual State budget for the Senior Citizen Activities Center Operating Fund to $750,000 and requires that $400,000 of the Fund be distributed to counties based on each county's share of the senior citizen population. The legislation also requires that $250,000 of the Fund be distributed to distressed counties in a specified manner. This legislation helps to ensure adequate funding for senior centers throughout the state and ensures appropriate focus on those centers serving low-income older adults. Many thanks to bill sponsor Delegate Mary Washington for her commitment to older adults and the institutions that serve their needs.
- Non-Disparagement Clauses – HB0131
This legislation prohibits the use of non disparagement clauses in consumer contracts. Many companies are including these types of provisions in their terms of services or in other provisions of consumer contracts. The clauses are intended to prevent a customer from leaving a critical review, especially in an online forum or online review site, such as www.amazon.com. Thanks to Delegate Jeff Waldstreicher for his leadership on this issue.
Other bills on ticketing restrictions and foreclosure-related concerns will be worked on during the interim. MCRC also supported legislation to require notice from a bank if a foreclosure sale was cancelled or postponed as well as to alert consumers if a store was monitoring your shopping habits. These bills passed in the House but died in the Senate.
Finally, THANK YOU for all of your phone calls and emails on behalf of our priority legislation. We worked hard to alert you when we needed your help and to work behind the scenes and in front of legislators in Annapolis on behalf of Maryland consumers.
We’ll be working now to determine our agenda for 2017, to educate consumers, and conduct research on pressing consumer issues.
Thanks for all you do to support Maryland consumers.
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Take the Credit! – PSA on the Maryland Homeowners' Tax Credit
Do you own your home in Maryland? Is your combined household income less than $60,000 per year?
If you answered "yes" to both questions, then you might qualify for the Maryland Homeowners' Tax Credit!