Comptroller Franchot Announces Help for Federal Workers Affected by Shutdown

ANNAPOLIS, Md. (January 15, 2019) - As the partial federal government shutdown extends into its fourth week, Maryland Comptroller Peter Franchot today announced a plan to provide financial relief to impacted federal workers unsure when their next paycheck will arrive.

Federal contractors, furloughed employees, and those working without pay currently on payment plans with the State may be granted reduced or even suspended payments while the shutdown drags on.

“The longer this government shutdown lasts, the more financial hardship it is causing federal workers, some of whom may never get repaid,” said Comptroller Franchot. “My agency recognizes that Marylanders affected by this prolonged impass face a greater burden to make ends meet and to fulfill their tax obligations. As always, we stand ready to help Marylanders facing these challenging times.”

The assistance provided by the Comptroller’s Office will help federal workers with personal income liabilities and other outstanding tax obligations. As specific circumstances vary, each request will be handled on a case-by-case basis.

Affected federal workers, including federal contractors and federal employees working without pay, who may have outstanding Maryland tax obligations, are encouraged to contact the Comptroller of Maryland’s Ombudsman’s Office via email at ombudsman@comp.state.md.us or via telephone at 410-260-4020.

To further assist taxpayers, an email address (govshutdownrelief@comp.state.md.us) has been created to receive specific shutdown-related inquiries.

MEDIA CONTACT: 

Alan Brody -  abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)

Federal Government Shutdown Affecting 172,000 Marylanders Resulting in $778M in Lost Wages

ANNAPOLIS, Md. (January 14, 2019) - With its large number of federal employees and contractors, Maryland’s economy is being profoundly impacted by the ongoing government shutdown, according to a report released today by the state’s Bureau of Revenue Estimates (BRE).

Approximately 172,000 Marylanders are currently impacted by the government closure, which began on Dec. 22, 2018. Each bi-weekly payroll for which these residents are not paid results in $778 million of lost wages, which translates to roughly $57.5 million less in combined state and local income tax withholding, and $2.1 million less in sales tax collections.

“These estimates demonstrate what we already knew — the unnecessary shutdown of our federal government is having a devastating effect on Maryland’s families and our state’s economic well-being,” said Maryland Comptroller Peter Franchot. “Even if some employees do eventually get repaid, our economy will not be made whole and changes to long-term spending habits may cause further harm.”

The uncertainty surrounding the shutdown — how long it will last and if it will happen again — will also likely reduce business investment, according to the Bureau of Revenue Estimates report.

Between 230,000 and 245,000 Marylanders are federal employees; since some agencies are funded through other budget appropriations, about 90,000 Marylanders are either furloughed or working without pay, according to the BRE report. It is estimated that roughly half of the state’s 164,000 federal contractors are impacted by the shutdown. Many of these workers are unlikely to be repaid once the government reopens, so state and local tax collections would suffer from their lost wages.

The full BRE report can be viewed here.

MEDIA CONTACT: 

Alan Brody -  abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)

Franchot: Shutdown Not Expected to Delay Opening of Tax Season

Maryland and IRS on track for January 28 start

ANNAPOLIS, Md. (January 8, 2019) - Despite the federal government shutdown, Comptroller Peter Franchot said there are no plans to delay processing personal income tax returns for Tax Year 2018. The Internal Revenue Service (IRS) and Maryland remain on track to begin processing individual returns on January 28.

Processing of business tax returns began today, January 8.

“Marylanders should go about their typical preparations to file their personal income tax returns,” Comptroller Franchot said. “My agency is in direct communication with the IRS to monitor the situation. If there are any changes at the federal level, we will immediately notify taxpayers.”

The IRS has asked furloughed employees to return to the job during the shutdown to avoid any impact to the processing of tax returns.

As in previous years, the Comptroller’s Office will not immediately process a state tax return if W-2 information is not on file with the agency. Employers are required to report wage information to the Comptroller on or before January 31.

The filing deadline for 2018 tax returns is Monday, April 15.

Taxpayers are encouraged to file their returns electronically for the fastest possible processing and to ensure they receive all possible refunds. A list of approved vendors for use in filing your electronic return can be found at www.marylandtaxes.gov.

Free state tax assistance is available at all of the agency’s 12 taxpayer service offices, Monday through Friday, 8:30 a.m. to 4:30 p.m. A list of office locations can be found at www.marylandtaxes.gov.

For more information on any tax-related matter, please visit the Comptroller’s website at www.marylandtaxes.gov or call 1-800-MD-TAXES (1-800-638-2937) or 410-260-7980 in Central Maryland.

MEDIA CONTACT:    Alan Brody -  abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)

 

Franchot Announces BPW Approval of $160 Million Contract to Replace State Tax Processing System

ANNAPOLIS, Md. (December 19, 2018) - Comptroller Franchot announced today that the Board of Public Works has approved a $159.7 million contract to replace and upgrade the state’s tax processing system with a state-of-the-art program that will expand revenue-generating projects, provide enhanced reporting functionality and make it easier for taxpayers to view their accounts with the agency. The contract was unanimously awarded to Pembroke, Massachusetts-based Revenue Solutions Inc.

“I am very excited about our new COMPASS tax system, which will let us process tax returns more quickly and stop tax cheats from stealing Marylanders’ hard-earned money,” said Comptroller Franchot. “For taxpayers, this means an even speedier tax refund and a more user-friendly experience that will eventually let them view and manage their accounts online.”

The COMPASS tax processing system will replace the agency’s State of Maryland Tax (SMART) system, Computer Assisted Collection System and other antiquated tax processing systems that operate on outdated, often-unsupported technology platforms.

Some highlights of the new system include:

  • Improved fraud detection and prevention programs. Compass will provide additional information in a centralized system that will allow the agency to use more complete and complex fraud models, reducing the number of fraudulent refunds issued and streamlining the pursuit and recovery of refunds obtained by fraud.
  • Increased ability for taxpayers to manage their accounts via online self-service applications. Taxpayers will be able to manage accounts online. After an initial learning period, the increase in online services will result in a reduction in call center and correspondence volumes.
  • Maximized compliance with best-practice security standards, internal controls and policies. The new system will improve the agency’s security posture by allowing for the implementation of additional cutting-edge security controls.
  • Maximized audit, collection, reporting and estimating functionality. Applying analytics to processing data will result in more efficient audit selection, targeted collections, flexible reporting and more refined estimating.
  • System stability and security. Maintaining the current system requires tremendous effort from very specialized resources that are increasingly harder to acquire. It is only a matter of time until the current system fails or becomes unable to handle new requirements, such as additional tax types.

The new system will be implemented over the next several years, but there will be no impact for the 2019 tax season. Upon completion, the Comptroller’s Office will be able to make changes to Maryland tax laws more quickly than it can now and be more responsive to taxpayers’ needs.

MEDIA CONTACTS:
Joseph Shapiro -  
jshapiro@comp.state.md.us
410-260-7305 (office); 443-871-2244 (mobile)

Alan Brody -  abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)

Comptroller Franchot’s Statement on New Revenue Estimates

ANNAPOLIS, Md. (December 12, 2018) - The Board of Revenue Estimates voted today to decrease its September 2018 revenue projections for Fiscal Year 2019 by 0.1 percent to $18.07 billion – representing a $18.4 million decrease. Additionally, the board will be revising the September estimates for Fiscal Year 2020 to $18.71 billion, representing a 0.3 percent, or $55 million, decrease from its previous projections.

Following are Comptroller Franchot’s remarks, as prepared for delivery:

“At our September meeting, this Board voted to increase our revenue projections by more than $700 million. Thanks to a more than half-a-billion-dollar surplus after we closed the books on FY 2018, the state finds itself with more than $1 billion in unspent revenue as we approach the 2019 Session.

Included in the revenues is the considerable inflow of revenue resulting from Wayfair Supreme Court ruling and the Tax Cuts and Jobs Act of 2017. And as we chart a course for the state’s fiscal future, it is incumbent upon our policymakers to make thoughtful decisions on the path forward when it comes to how we spend the taxpayers’ hard-earned dollars.

The fact of the matter is that while our state’s economic bones remain strong, we continue to see stagnation in wage growth and permanent, long-term employment, both of which serve as critical indicators for our state’s fiscal and economic outlook.

This is the 113th month of economic expansion since the Great Recession, and the only other expansion to run longer was 119 months, which occurred during the tech boom back in the 1990s. So we’re six months out from that historic benchmark, and we cannot expect that we will defy the laws of economic gravity, and we must plan for the inevitable economic downturn that will occur in the future.

That’s why I have publicly called upon the Governor and the General Assembly to increase the state’s allocation into the Rainy Day Fund, especially now that the state’s bank account is considerably higher thanks to the unexpected injection of revenue from the Wayfair decision and the Federal Tax Cuts.

I took office the year before the Great Recession paralyzed our economy. And I, like many in this room, remember the very difficult choices that we had to make as our state tried to weather through the Great Recession.

Budget cuts, furloughs, tax increases were some of the tough decisions that were made by the previous Administration and the General Assembly to balance our state’s books. Because it is impossible to foresee unexpected and disruptive changes to our economy due to market volatility and trade uncertainty, and given the continued political turmoil that paralyzes Washington, we – here in Maryland – have an obligation to do everything we can to plan for future economic downturns.

We have to show Maryland taxpayers that we learned our lessons from the Great Recession, and that we – like so many working families and small businesses – are going through our budget line-by-line and foregoing the things we want, in order to pay for the things we need.

As the Governor and legislators prepare to convene for the 2019 Legislative Session, let me once again publicly renew my call for fiscal restraint. I know the General Assembly will be considering a number of very worthy and critically important programs and proposals in the upcoming year.

But it is my sincere hope that my colleagues up the street would be mindful of the great need to carefully consider these proposals’ impact on the state’s fiscal health and the financial well-being of hardworking Marylanders across our state.”

View the data here.

MEDIA CONTACTS:
Joseph Shapiro -  
jshapiro@comp.state.md.us
410-260-7305 (office); 443-871-2244 (mobile)

Alan Brody -  abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)

Comptroller Franchot Announces New Cornerstone Award for Local Business Excellence

ANNAPOLIS, Md. (November 26, 2018) - Comptroller Peter Franchot today announced his office is accepting nominations for a new award recognizing businesses that celebrate the guiding values of independence, innovation and investment that define Maryland’s local business community.

The “Cornerstone Award for Local Business Excellence” will celebrate businesses that strengthen Maryland’s economy, generate jobs and tax revenue, develop new ideas that more effectively deliver services and products within the marketplace and lead by example in their local community.

“Maryland has many innovative and diverse businesses that step up, pave the way forward and assume the risk to change and improve how we experience the world and go about our daily lives,” Comptroller Franchot said. “This award will recognize these leaders in all of our communities, large and small, for their contributions to Maryland’s economy.”

Nominations will be accepted through December 31. One business will be selected from each of Maryland’s 23 counties and Baltimore City. Awards will be presented from January through the end of June. Businesses of any sector and any size are eligible for the award.

The nomination form should detail how the business is transforming their industry and/or impacting the world around them through their independence, innovation or investment and what future opportunities may follow.

MEDIA CONTACTS:
Joseph Shapiro - 
 jshapiro@comp.state.md.us
410-260-7305 (office); 443-871-2244 (mobile)

Alan Brody –  abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)

Franchot Announces Seizure of Contraband Alcohol in Baltimore

ANNAPOLIS, Md. (October 22, 2018) - Comptroller Peter Franchot announced that his Enforcement Bureau of the Field Enforcement Division made a significant seizure of contraband alcoholic beverages on October 11 at a Baltimore liquor licensed business with assistance from the Baltimore City Liquor Board Inspector and Baltimore City Vice Detectives.

“My Field Enforcement Division team is ever vigilant in its efforts to make sure all businesses are playing by the same rules,” Comptroller Franchot said. “I applaud their work and the assistance from the city liquor board and Baltimore police. These combined law enforcement efforts level the field for all businesses and protect Maryland’s consumers.”

On October 11, agents and inspectors from the Enforcement Bureau along with Baltimore City Liquor Board and Baltimore Police Department Vice Unit conducted an unannounced liquor inspection at Indulge Gentleman’s Club at 403 E. Baltimore Street, located in an area known as “The Block.” The purpose of this routine liquor inspection was to assure compliance with state laws and regulations. The licensee is Donald Savoy of Don West Management, trading as “Indulge.”

During the inspection, 61 bottles of distilled spirits with a retail value of $1,332.85 were seized as products obtained from a supplier other than a wholesaler. In Maryland, a retailer may not purchase/keep an alcoholic beverage on the licensed premises which was purchased from other than a licensed wholesaler.

All details and evidence will be forwarded to the Baltimore City Liquor License Board located at 231 E. Baltimore Street by the Comptroller’s Enforcement Bureau to be used at the board’s discretion for administrative action and subsequent sanctions.

FED agents and inspectors conduct random routine inspections at licensed retailers  of alcoholic beverages throughout the state to assure that Maryland’s alcoholic beverage laws are being followed. Liquor-licensed retailers can only be in possession of and sell alcoholic beverages that were supplied to them by a licensed Maryland wholesaler to assure that the alcohol excise tax has already been paid by the wholesaler who supplied the product to the retailer.

MEDIA CONTACTS:
Joseph Shapiro -  
jshapiro@comp.state.md.us
410-260-7305 (office); 443-871-2244 (mobile)

Alan Brody -  abrody@comp.state.md.us
410-260-6346 (office); 443-924-1473 (mobile)