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MarylandHB 08982026 Regular SessionHouseWALLET

Economic Development - Delivering Economic Competitiveness and Advancing Development Efforts (DECADE) Act

Sponsored By: Nick Allen (Democratic)

Signed by Governor

Economic DevelopmentTaxes - IncomeTaxes - PropertyAllegany CountyAnnotated Code of MarylandAppropriationsArmed Forces and Uniformed ServicesArt, Music, and Cultural Affairs -see also- EthAff; Mus; etcAuditors and AuditsBiotechnologyBonds -see also- County & Baltimore City Bonds; State BondsCommerce and Business -see also- ElectrComm; ForeignTr; etc.Commerce, Department ofCommunity DevelopmentComptrollerCorporations -see also- Municipal Corps; Public Corps & InstData -see also- Census; DemographicsDigital Products -see also- Digital ImagesDisabilitiesDisclosureDorchester CountyElectronic GovernmentEnterprise ZonesEvaluations and ReviewsFees -see also- Attys' Fees; Devt Fees & TaxesFinancial Institutions -see also- Banks; Credit Unions; etc.FormsGarrett CountyGeneral Assembly -see also- AELR Cmte; LegislativePolCmteGoods and Services -see also- Retail Sales; TermnSvc; TrfGdsGovernorGrantsHousing and Community Development, Department ofIncome TaxInformation TechnologyInterestInternet -see also- Internet AccessInvestments -see also- SecuritiesLegislative Policy CommitteeLoans -see also- Credit; Mortgages; Scholarships&SFAMinority Business EnterprisesMinoritiesNamesNonprofit OrganizationsNoticesPenalties and Sentences -see also- Death PenaltyPilot ProgramsPlans and ProposalsProcurementPublic Corporations and Instrumentalities -see also- HBEReportsRevenue and Taxes -see also- (specific tax)Salaries and Compensation -see also- Overtime; Reimb. RatesSmall BusinessSomerset CountySunsetTax CreditsTechnology -see also- AeroT; BioT; EnergyT; InfoT; MedT; etcTreasurersWomen -see also- GenderWork, Labor, and Employment -see also- JobTrn; Leave; etc.

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Bill Overview

Analyzed Economic Effects

22 provisions identified: 9 benefits, 2 costs, 11 mixed.

RISE zone property credit and fee waiver

Starting July 1, 2026, certified businesses in a RISE zone can stack the zone’s property credit with an enterprise‑zone or focus‑area credit. Your total credits cannot be more than 100% of the property tax that would otherwise be due, and normal credit time limits still apply. Beginning in fiscal year 2027, the state waives the annual filing fee each year you show you located in a designated RISE zone within 3 years of the fee due date and you operate in an eligible technology sector.

Hiring and income tax credits in RISE zones

Certified businesses in RISE zones can qualify for tax credits. Standard wage credits are up to $3,000 per economically disadvantaged employee and up to $1,000 per other qualified employee. Enhanced wage credits in focus areas are up to $4,500 and $1,500 per employee. Do not count hires who replace workers employed in the same year or the prior three years. RISE businesses may also qualify for an income tax credit as if they were in an enterprise zone, if they meet certification and timing rules.

Security facility and clearance tax credits

For tax years starting after December 31, 2022 and before January 1, 2033, employers with 500 or fewer employees can claim State credits for security costs. You can claim up to $200,000 for security‑clearance administrative costs. You can claim up to $200,000 for first‑year rent if your small business does security‑based contracting. For one SCIF, the credit is the lesser of 50% of construction and equipment costs or $200,000; across multiple SCIFs, total construction/equipment credits are capped at $500,000.

Sales tax break for affiliated companies

Sales and use tax does not apply when a vendor and buyer are in the same affiliated group for certain listed taxable services and for digital codes or digital products. The law uses federal affiliated‑group rules (Internal Revenue Code §1504 and related party rules), including treatment for S corporations. This lowers tax on intercompany sales of the covered services and digital items.

R&D tax credit approvals end after 2030

The Department stops approving R&D tax credits for taxable years that begin after December 31, 2030. If you use a fiscal year, you may apply only for a prorated credit for the part of your year in 2030.

Property tax breaks in RISE and enterprise zones

Starting July 1, 2026, zone property credits follow clear rules. In enterprise zones, the credit is 80% of the tax on the eligible assessment for years 1–5. In focus areas, the credit is 100% for years 1–5. If a RISE zone is renewed, properties get at least 10% for years 6–10. A property can claim a RISE credit for up to 5 straight tax years, starting the next year after it qualifies, or the same year if the local government and Commerce approve. If a RISE zone expires, already‑qualified properties keep their credit. Local governments can raise the credit percentages by local law. Cross‑jurisdiction credits need consent from both the county and the municipality. MEDC certifies qualified properties and SDAT shares base values before bills. RISE zones count as enterprise zones in law. Nonresidential business property used by a business that located in a RISE zone before January 1, 2023 gets a credit.

Build Our Future grants require big match

The Corporation runs Build Our Future grants for innovation infrastructure in sectors like advanced manufacturing, AI, biotech, quantum, cyber, and more. Awards can be up to $2,000,000 per entity each fiscal year. You must match at least 200% for grants up to $1,000,000, and 400% for grants over $1,000,000 up to $2,000,000; other State grants do not count toward the match. A special Fund supports the program and may use up to 10% yearly for administration. The Corporation can require repayment if you miss reporting or misuse funds. Applicants in RISE zones get priority. The program runs through June 30, 2030.

More capital and bonds for small businesses

The law raises help for small businesses. Loans and guaranties can go up to $3,000,000 each. Equity investments can be up to $3,000,000, with recovery expected within seven years. Surety guarantees can cover up to 90% of a loss or $3,000,000, and individual bonds can be up to $5,000,000. You no longer need a contract mostly paid by government to qualify. Part of video lottery money flows to small business funds, including $5 million each year to the Small Business Development Financing Fund. The Department may hire a private Maryland contractor to run programs. Penalties for knowingly false applications are tougher: up to 5 years in jail and up to a $50,000 fine.

Film tax credit: flexible filings, $30M cap

A film production can amend its credit application if an independent auditor confirms the budget changed by 50% or more. The Secretary reviews the amended filing and any award depends on credits available that year. For fiscal years 2027–2030, a single production can receive at most $30 million in total certified credits.

More capital for small, minority businesses

Commerce gives grants to experienced fund managers to invest in small, minority, and women‑owned businesses. Help can be a loan or a grant up to $10,000 when paired with a loan. At least 50% of Account funds (not SEIF money) go to businesses near video lottery facilities. The Department must approve loan disbursement requests within 30 days, review manager performance every year, and seek new managers at least every 3 years. Managers may use some grant funds for admin, marketing, legal, actuarial, and technical costs, within limits.

New state small business financing hub

The law creates the Maryland Small Business Development Financing Authority to run financing programs for small firms. It sets up a special, nonlapsing Fund that the State Treasurer invests and that keeps its earnings. The Fund can receive fees, loan repayments, collateral sale proceeds, State and federal money, and private contributions. A Contract Financing Program can use the Fund to make direct loans, guarantee loans and equity, and pay program costs.

RISE zones: help for new businesses

Beginning July 1, 2026, a qualified institution and a local government can apply to designate a RISE zone up to 500 acres; the Corporation decides within 120 days and must notify lawmakers 45 days before the decision. A zone lasts 10 years and can be renewed for another 10 years. Businesses in RISE zones get priority for certain state financial help. Newer firms (7 years old or less) can get rental assistance for up to 5 years, and no more than 25% of total Fund money may go to rental aid in any one zone. The RISE Fund pays rental aid and related costs; earnings stay in the Fund and spending follows the State budget. Programs taking Fund money must file a report by September 15 each year, get a CPA audit at least every 3 years, and can face recapture of misused or undisbursed funds. Each zone gets a state “concierge” to help with permits and access to programs. The law defines a RISE zone so programs know which areas qualify.

Bigger MEDA help and faster approvals

The MEDA Fund can make larger awards. Loans or investments can be up to $7,500,000. Grants can be up to $5,000,000. Local government or Corporation projects can get up to $5,000,000. For Tier I county projects, the Department sets the amount. The Secretary can approve awards up to $5,000,000, and may approve higher amounts for Tier I county projects. A local endorsement letter must be signed by a majority of the governing body.

Cap on RISE zones per county

A county or municipal corporation can have up to 3 RISE zones. Baltimore City can have up to 4. One extra extraordinary zone may be approved for a jurisdiction if the Secretary decides it promotes quantum computing.

Rules for small business loans and guarantees

The Authority can guarantee up to 80% of principal and interest on long‑term loans. An investor’s equity guaranty is capped at the lesser of 10% of their investment or $250,000. To qualify, an individual must be a Maryland resident or have their main business here, be of good character, and be unable to get reasonable bank financing due to barriers like disability, historic exclusion, other impediments, or failing one bank’s credit test. For non‑sole proprietors, at least 70% of the business must be owned by people who meet those rules. You must apply for a bank loan and be denied before getting a guaranty, submit the Authority’s application, and you may have to provide an audited balance sheet. Loan papers use a market interest rate unless the Authority sets a lower rate, include a disbursement schedule and co‑signed advance requests, and can secure repayment with an assignment or lien; the Authority decides whether Fund loans charge interest and sets the rate. If you or your lender break loan terms or program rules, the Authority can withhold payments or subsidies and use other remedies.

Reserve fund reshaped, earnings shifted

The State Reserve Fund now includes the Dedicated Purpose, Revenue Stabilization, Strategic Closing, and Catastrophic Event accounts. Investment earnings from the Strategic Closing Fund go to the State General Fund, and the Fund is invested like other State funds. This can add money to the General Fund but leave less investment income inside the Strategic Closing Fund.

Key program start and end dates

The RISE Part ends on January 1, 2030. Existing businesses keep benefits only until their zone’s original end date. The Build Our Future Grant Program ends on June 30, 2030. A separate tax subtitle and its credit now end on January 1, 2032, with carryforward and recapture rules. Section 4 applies to tax years starting after December 31, 2025. Section 5 applies to tax years starting after June 30, 2026.

Strategic Closing Fund aid and oversight

The Fund can loan, grant, or invest to retain, expand, or attract businesses and institutions, or to fill gaps other programs cannot. Before money goes out, Commerce must submit detailed plans, job and wage estimates, and a net‑benefits analysis; the Legislative Policy Committee has 60 days and must approve. Commerce may approve nonmaterial deal changes without going back to the Committee. Some Fund money may pay administrative, legal, or actuarial costs. Recipients must encourage buying from minority businesses and may need to report vendors and dollar amounts.

Strategic Closing Fund refocused with guardrails

The law creates the Strategic Closing Fund as a nonlapsing fund at Commerce. The Governor can put money into it and loan repayments stay in the fund. To qualify, an applicant must be financially strong, low credit risk, able to get other financing, fit the State’s plan, and create or keep many jobs. The Fund cannot replace other available State or local funds, cannot fund projects outside Maryland, and cannot fund stadium land or any sports activity.

Public database on jobs and incentives

Commerce maintains a public, downloadable database updated each year on economic development programs. It lists jobs created and kept, pay ranges, benefits, training, State revenue estimates, fund statuses, minority‑business assistance, and recapture actions. By December 1, 2029, the Department reports on whether program changes improved use and results.

Program start dates and leadership setup

The Executive Director is the Authority’s chief administrator and runs daily operations with the Secretary’s approval. Duties include supervising operations, attending meetings, keeping minutes, and approving payroll and allowable expenses. Most of the Act takes effect June 1, 2026, except Sections 1, 2, 3, 4, and 6, which take effect July 1, 2026.

New tools and admin updates at Commerce

Commerce now shares the economic development block grant program with Housing. The Build Our Future Grant Pilot Program is removed from Commerce’s list. MEDC can use money meant for grants to buy equity in qualified businesses. This gives the state another way to back companies.

Sponsors & Cosponsors

Sponsor

  • Nick Allen

    Democratic • House

Cosponsors

  • Marlon Amprey

    Democratic • House

  • Dylan Behler

    Democratic • House

  • Harry Bhandari

    Democratic • House

  • Adrian Boafo

    Democratic • House

  • Regina T. Boyce

    Democratic • House

  • Derrick Coley

    Democratic • House

  • Dana Jones

    Democratic • House

  • Mark Edelson

    Democratic • House

  • Diana M. Fennell

    Democratic • House

  • Mike Griffith

    Republican • House

  • Michele Guyton

    Democratic • House

  • Andrea Fletcher Harrison

    Democratic • House

  • Terri L. Hill

    Democratic • House

  • Marvin E. Holmes

    Democratic • House

  • Kevin B. Hornberger

    Republican • House

  • Julian Ivey

    Democratic • House

  • Aaron M. Kaufman

    Democratic • House

  • Robbyn Lewis

    Democratic • House

  • Gabriel M. Moreno

    Democratic • House

  • Darrell Odom

    Democratic • House

  • Cheryl E. Pasteur

    Democratic • House

  • Edith J. Patterson

    Democratic • House

  • N. Scott Phillips

    Democratic • House

  • Andrew C. Pruski

    Democratic • House

  • Lily Qi

    Democratic • House

  • Denise Roberts

    Democratic • House

  • Mike Rogers

    Democratic • House

  • Kim Ross

    Democratic • House

  • Malcolm P. Ruff

    Democratic • House

  • Gary Simmons

    Democratic • House

  • Jared Solomon

    Democratic • House

  • Ryan Spiegel

    Democratic • House

  • Deni Taveras

    Democratic • House

  • Kym Taylor

    Democratic • House

  • Chris Tomlinson

    Republican • House

  • Veronica Turner

    Democratic • House

  • Courtney Watson

    Democratic • House

  • Jennifer White Holland

    Democratic • House

  • Greg Wims

    Democratic • House

  • Chao Wu

    Democratic • House

  • Natalie Ziegler

    Democratic • House

Roll Call Votes

All Roll Calls

Yes: 277 • No: 34

Senate vote • 4/13/2026

Third Reading Passed

Yes: 46 • No: 1

House vote • 4/13/2026

Third Reading Passed

Yes: 113 • No: 23 • Other: 4

House vote • 3/21/2026

Third Reading Passed

Yes: 118 • No: 10 • Other: 7

Actions Timeline

  1. Approved by the Governor - Chapter 352

    5/12/2026

  2. Passed Enrolled

    4/13/2026House

  3. Third Reading Passed (113-23)

    4/13/2026House

  4. House Concurs Senate Amendments

    4/13/2026House

  5. Third Reading Passed (46-1)

    4/13/2026Senate

  6. Second Reading Passed with Amendments

    4/13/2026Senate

  7. Favorable with Amendments {353620/1 Adopted

    4/13/2026Senate

  8. Favorable with Amendments Report by Budget and Taxation

    4/10/2026Senate

  9. Hearing 4/02 at 1:00 p.m. (Budget and Taxation)

    3/25/2026Senate

  10. Referred Budget and Taxation Finance

    3/23/2026Senate

  11. Third Reading Passed (118-10)

    3/21/2026House

  12. Second Reading Passed with Amendments

    3/20/2026House

  13. Favorable with Amendments {663424/1 Adopted

    3/20/2026House

  14. Favorable with Amendments Report by Ways and Means

    3/20/2026House

  15. Hearing 2/24 at 1:00 p.m. (Ways and Means)

    2/6/2026House

  16. Reassigned to Ways and Means Economic Matters

    2/6/2026House

  17. First Reading Economic Matters

    2/4/2026House

Bill Text

  • Enacted

    5/12/2026

    PDF

  • Enrolled

    4/13/2026

    PDF

  • Third Reading

    3/20/2026

    PDF

  • First Reading

    2/4/2026

    PDF

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