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During a Friday visit to Easton, Maryland Comptroller Peter Franchot spoke via videoconference with The Spy.
Franchot talked about Maryland’s tax season, which began Feb. 12; the state’s COVID-19 stimulus checks, processed by his office; and how Maryland’s economy looks after nearly a year of the pandemic.
This video is about 18 minutes long.
Eligible Marylanders could begin receiving RELIEF Act payments from the state by the end of the week, Comptroller Peter V.R. Franchot (D) said at a briefing Tuesday.
Franchot said his office has already started processing roughly 267,000 electronic payments and 149,000 paper checks for 422,531 eligible stimulus recipients, totaling more than $175 million, will soon head out to low-income Marylanders who filed for the Earned Income Tax Credit (EITC) in 2019 and still live in the state.
“Those are out of our office,” Franchot said. “They’re delivered to banks. Banks then have to do a certain amount of protection of the taxpayers by doing fraud protection reviews.”
More than 98% of the state stimulus payments will be processed by the end of the week, Franchot said. He added he expects the electronic payments to start appearing in eligible people’s bank accounts on Friday.
The speedy processing of the stimulus payments came just a day after Gov. Lawrence J. Hogan Jr. (R), alongside legislative leaders, signed the billion-dollar RELIEF Act into law. That relief effort was fast-tracked through the legislature in recent weeks, despite heated debate over who should be included in the bill’s immediate stimulus checks.
The finalized RELIEF Act provides immediate payments of $500 for families and $300 for individuals who filed for the EITC in 2019 and still reside in the state.
Franchot said there is roughly $2.7 million in stimulus payments that can’t currently be sent out, since his office doesn’t have a valid bank account for verified addresses for those recipients. He warned that 6,574 Marylanders won’t be able to receive their stimulus checks until they contact his office to update their information.
“Their payments are currently in a holding pattern,” Franchot said.
He added that his office has launched an online portal so Marylanders can tell if they’re eligible for the payments. People can also email their RELIEF Act questions to RELIEFAct@marylandtaxes.gov, or call 1-833-345-0787.
Franchot also acknowledged that the stimulus payments won’t go to every low-income Marylander. He added that he expects a “flood of calls” from people asking why they aren’t eligible for the stimulus payments.
“We’re not the legislature, and we’re not the governor, who made this program,” Franchot said.
He reiterated that, even though he thinks the legislature’s amendments improved upon Hogan’s RELIEF Act, he still feels that the relief effort “falls far, far short of the goal of genuine relief.”
Franchot warned that, because the EITC requires a Social Security number, many tax-paying immigrants who file taxes with individual taxpayer identification numbers (ITIN) won’t receive stimulus checks. He also said the EITC is an underutilized program, with some Marylanders who qualify not claiming the tax credit.
And he again reiterated his call for Hogan and the legislature to provide larger stimulus checks to a broader group of Maryland taxpayers.
“No one can seriously think that a few hundred dollars, a $300 check, is going to make a dent in the mountain of debt that’s been accumulated over the past year by many of these wonderful Maryland families and citizens,” Franchot said.
Senate President Bill Ferguson (D-Baltimore City) and House Speaker Adrienne A. Jones (D-Baltimore County) have pledged to quickly pass legislation that would extend EITC benefits to ITIN filers for the 2020, 2021 and 2022 tax years. More than 86,000 ITIN filers paid more than $100 million in state and local taxes last year, according to Franchot, and many of those taxpayers would meet the EITC income criteria.
“No Marylander deserves to wonder where their next meal will come from, how to buy their child’s diapers, or how to pay for life saving medicine – especially when they go to work every single day,” a statement from Jones and Ferguson, released shortly after the final passage of the RELIEF Act, reads.
By Bennett Leckrone
After the House of Delegates nixed a last-minute provision that would’ve included broader stimulus checks for Maryland taxpayers, Gov. Lawrence J. Hogan Jr. (R) plans to sign a billion-dollar relief effort into law Monday.
Hogan’s RELIEF Act, as currently amended and approved by both the House and Senate on Friday, would include sweeping tax relief for small businesses and Marylanders, and direct stimulus checks to certain low-income taxpayers. The proposal was overwhelmingly passed by the legislature Friday after a day of contentious debate over whether to include taxpayers without Social Security numbers, including undocumented immigrants, in the bill’s direct stimulus.
Hogan, who has repeatedly called on the legislature to quickly pass his relief proposal, lauded lawmakers’ fast action in a Friday statement.
“The RELIEF Act will deliver more than $1 billion in tax relief and economic stimulus for struggling families and small businesses,” Hogan wrote. “It will help Marylanders barely hanging on right now as we work to bring this global pandemic to an end. While Washington gears up for yet another partisan fight, here in Maryland we are once again setting an example of what effective and bipartisan leadership looks like.”
A spokesperson for Hogan confirmed that the governor plans to sign the emergency relief package into law on Monday.
The relief package includes direct stimulus payments – $500 for families and $300 for individuals – to low-income taxpayers who filed for the Earned Income Tax Credit (EITC) in 2019. But because the EITC requires a Social Security number, advocates have warned that thousands of Maryland taxpayers would be excluded from those stimulus payments.
House Democrats on Thursday added people who file taxes with individual taxpayer identification numbers (ITIN) who meet the EITC income guidelines to the RELIEF Act’s stimulus checks.
ITIN filers also include undocumented immigrants and “some people who are lawfully present in the U.S., such as certain survivors of domestic violence, Cuban and Haitian entrants, student visa–holders, and certain spouses and children of individuals with employment visas,” according to the National Immigration Law Center.
But the proposal to send ITIN filers stimulus checks was withdrawn Friday after Republican objections and questions over its viability threatened to hold up the bill. Instead, lawmakers plan to pass separate legislation next week to provide assistance to ITIN filers.
More than 86,000 ITIN filers paid more than $100 million in state and local taxes last year, according to Comptroller Peter V.R. Franchot (D), and many of those taxpayers meet the EITC income qualifications.
House Majority Leader Eric G. Luedkte (D-Montgomery County) said the removal of ITIN filers from the relief proposal was a compromise. He promised to quickly pass an “equivalent program” that would provide relief for those taxpayers as early as next week.
“Every Maryland taxpayer in poverty deserves help,” Luedtke said.
In a joint statement, Senate President Bill Ferguson (D-Baltimore City) and House Speaker Adrienne A. Jones (D-Baltimore County) promised to pass legislation to “include every Maryland taxpayer in the Earned Income Tax Credit” next week.
“No Marylander deserves to wonder where their next meal will come from, how to buy their child’s diapers, or how to pay for life saving medicine – especially when they go to work every single day,” the statement reads.
Ferguson and Jones wrote that, combined with the newly passed RELIEF Act, the proposal will be “the best anti-poverty legislation to have passed the General Assembly in years.”
That relief won’t include immediate stimulus payments to ITIN filers, a spokesperson for Ferguson said. It’ll extend EITC benefits to ITIN filers for the 2020, 2021 and 2022 tax years, Ferguson said at a Friday evening media briefing. He noted that Hogan currently holds “all the cards” in determining how to distribute relief funding.
In a Friday statement, CASA Research and Policy Analyst Cathryn Paul demanded the fast passage of that legislation, including a veto override if necessary.
“Today, leaders of the Maryland House and Senate issued a joint statement committing to immediately passing EITC reform expanding coverage to include ITIN filers,” Paul said. “While EITC reform is certainly needed, it is unimaginable that an anti-immigrant Governor like Larry Hogan will not veto the bill when it reaches his desk. Only a veto-proof majority and rapid veto override vote will provide the critical relief needed by immigrant tax filers.”
(Hogan’s wife, First Lady Yumi Hogan, immigrated to the U.S. from South Korea.)
After the House approved of the relief proposal Friday, the bill returned to the Senate floor just before 5 p.m. on Friday and was passed by a unanimous vote, 45-0.
“We have seen livelihoods destroyed and we have seen lives lost. And this is a clear message to Marylanders everywhere … relief is on its way. Not next year, not in the next month, but now. That is why we put partisanship aside and put public service first,” Sen. Craig Zucker (D-Montgomery) said.
Senate Minority Whip Michael J. Hough (R-Frederick) commended the chamber for working through a compromise quickly
“I think the Senate really showed leadership here and did a good thing. We’re going to get direct aid to people, relief,” Hough said. “It’s not a perfect bill, compromises are never perfect … but nonetheless I think this is a good bill overall.
In a Friday press release, leaders of the Maryland Legislative Latino Caucus said Maryland would join California and Colorado if it expands EITC benefits to ITIN taxpayers. According to that release, Attorney General Brian E. Frosh (D) said that the previous proposal to include ITIN filers in the RELIEF Act “would not be viable.”
“Now, more than ever, we must ensure there are no barriers to help those in need,” Latino Caucus Vice Chair Joseline Peña-Melnyk (D-Anne Arundel and Prince George’s) said in the release. “Immigrants have been working to keep our communities afloat during this time, so we absolutely need to step up for them.”
Franchot, in a statement after the vote, said he still believes the RELIEF Act “falls considerably short,” but was improved by legislative amendments.
“I was disappointed that tax-paying immigrants were excluded from receiving direct stimulus payments,” Franchot said. “They are our friends and neighbors who are also struggling to feed their families and pay their bills. The taxes they pay provide financial relief to others, but they are being cast aside without immediate assistance. This is economic injustice, plain and simple.”
His office will work with the General Assembly to “provide EITC benefits to all eligible Marylanders ― regardless of whether they file their taxes with a Social Security Number or an ITIN ― as soon as possible.”
By Bennett Leckrone and Danielle E. Gaines
Gov. Lawrence J. Hogan Jr. (R) unveiled a proposed billion-dollar stimulus package at a Monday morning press conference, which would give low-income families $750 checks if passed by the legislature.
If enacted, Hogan’s Recovery for the Economy, Livelihoods, Industries, Entrepreneurs and Families (RELIEF) Act would offer stimulus checks to Marylanders who qualified for the Earned Income Tax Credit in 2019 or 2020. The payouts would amount to $450 for individuals and $750 for families, with no application needed.
Hogan estimated that the $267 million in direct payments would help roughly 400,000 Marylanders. The stimulus checks would be in addition to anticipated payouts from the federal government.
Hogan said he needs the legislature’s help in passing some of the RELIEF Act’s measures, which extend beyond his emergency powers – and demanded that lawmakers quickly pass the emergency legislation.
“We took every action that we could take alone,” Hogan said.
The stimulus package provides $180 million in tax relief for unemployed residents by repealing all state and local income taxes on unemployment benefits. It would also allow small businesses to keep up to $12,000 in sales tax over the next four months, amounting to $300 million statewide.
Hogan also wants the legislature to extend and codify his executive order protecting businesses from sudden increases in unemployment taxes due to layoffs, amounting to $218 million in savings. The act would also eliminate taxes on the state’s emergency relief grants and loans for businesses.
Only about $100 million of Maryland’s rainy day funds would be be used as part of the relief package – a far cry from what other state officials and local leaders have demanded of Hogan.
Members of the Maryland United for COVID Relief NOW Coalition, headed by Comptroller Peter V.R. Franchot (D) and Montgomery County Councilmember Tom Hucker (D), held a virtual rally on Sunday to demand Hogan use more of the rainy day fund for COVID-19 relief.
Franchot has floated using a much larger portion of state reserve money for $2,000 stimulus checks to qualifying Marylanders at a cost of $925 million. He also wants to use state money for more local business aid, and in total proposed using more than a billion in state reserves for residents and businesses.
In a Monday statement on social media, Franchot said Hogan’s proposed stimulus doesn’t go far enough to help working residents. He also said the proposed checks won’t get to families fast enough.
“Maryland families need help now, but instead the Governor is passing the buck to the legislature,” Franchot wrote. “The Governor knows that he has the power to authorize direct cash payments to those in crisis right now. He can help struggling families right NOW.”
Hogan’s plans for a new state stimulus bill predate the coalition’s formation. He said using the state’s entire rainy-day fund would be an “irresponsible action,” and said he was following along with the legislature’s recommendations in using only portions of the state’s reserve money.
In December, a bipartisan legislative budget panel recommended using some of the state’s rainy day fund to combat anticipated shortfalls in the state’s budget.
Hogan noted that more federal relief funding is on its way to the state, including $400 million for much-needed rental assistance. The state has already spent more than $700 million in relief for residents and businesses, and doled out billions in unemployment benefits to Marylanders, Hogan said.
Whether the legislature moves quickly to act on Hogan’s proposal — or sees it as an opening gambit — is an open question. Legislative leaders have echoed Hogan’s assertion that providing help to the neediest Marylanders should be the top priority of the session, which begins on Wednesday, but they have yet to release details of their own economic relief package.
In a statement released after Hogan’s news conference, Senate President Bill Ferguson (D-Baltimore City) and House Speaker Adrienne A. Jones (D-Baltimore County) said Democrats in the legislature are “focused on getting families and small businesses back on their feet” in addition to getting students back in schools and ensuring the safety of seniors. The presiding officers said General Assembly members are planning legislation to address “a broken Unemployment Insurance system” and aid small businesses.
“We look forward to the Governor working with us to accomplish these goals and demonstrating for the country what the true value of bipartisanship can be,” Jones and Ferguson said.
Sen. Guy J. Guzzone (D-Howard County), the chair of the Senate Budget and Taxation Committee, called Hogan’s proposed stimulus a “good place for us to start” when it comes to getting relief to Marylanders.
Guzzone said he doesn’t think draining the state’s rainy day fund is in the best interest of the state, and added that Marylanders could still get meaningful relief without using all of the reserves.
“I actually don’t think it’s necessary, to provide substantial relief, to drain it all the way down in that regard,” Guzzone said.
He noted that many of the legislature’s relief efforts will depend on Hogan’s budget proposal, which is due later this month.
By Bennett Leckrone
Maryland Comptroller Peter Franchot urges Gov. Larry Hogan to provide additional COVID-19 relief to small businesses in the state. Franchot, who made the request Wednesday morning during the Maryland Board of Public Works meetings, wants the state to provide $500 million to help small businesses.
Hogan said the state has provided $250 million for small businesses and passed through billions in federal funds to aid businesses and those who are unemployed.
The governor said he would be announcing additional measures to benefit small businesses on Thursday.
Both men agreed that Congress needs to put aside party differences and pass a federal stimulus package to help citizens and businesses.
Franchot is seeking the Democratic nomination for governor in 2022; Hogan is term limited and has been the subject of speculation about a future presidential bid.
