Public School System Contracts - Prohibited Provisions

New contract protections for Maryland schools

Beginning July 1, 2026, the law limits terms in Maryland public school systems' agreements. Exceptions apply when funds are appropriated or state or federal law requires a term. Banned terms include promises to defend another party or cover its liabilities, and binding dispute resolution outside court. Contracts cannot require disputes against the school system to go anywhere except a Maryland court with proper authority. They cannot limit recovery for direct losses from injury, death, or property damage caused by negligence or other wrongful conduct. Schools cannot accept unknown terms, terms the other party can change alone, or electronic terms accepted by an employee without authority. Contracts cannot restrict schools' choice of lawyer or conflict with state open-meeting and public-records duties. They cannot commit unapproved money, require automatic renewal that commits future-year funding, or limit recovery of extra replacement-contractor costs for unfinished services. A banned term is void from the start; the remaining contract stays enforceable under Maryland law despite contrary contract language. The rules exclude specified collective bargaining agreements, contracts signed before July 1, 2026, and renewals or extensions of those earlier contracts.