Bill > HB507

This bill clarifies and strengthens restrictions on provisions that can be included in State contracts in Maryland. Specifically, the bill prohibits State contracts from containing several types of problematic clauses, including provisions that would require the State to indemnify or hold harmless another party without appropriate funding, agree to binding arbitration, specify a jurisdiction outside of Maryland for legal disputes, or limit the State's liability for property damage or bodily injury caused by negligence or misconduct. The bill also prevents contracts from including terms that can be unilaterally changed by the other party, automatically renewed without funding allocation, or limit the State's ability to recover costs if a replacement contractor must be hired to complete services not performed by the original contractor. If a State contract contains any of these prohibited provisions, those specific clauses will be considered void, and the rest of the contract will remain enforceable. The bill explicitly does not apply to contracts related to racing or training facility sites. The provisions of this bill will take effect on October 1, 2025, providing state agencies and potential contractors time to adjust to the new requirements.

Budget and Finance, Health and Social Services

https://mgaleg.maryland.gov/mgawebsite/Legislation/Details/HB0507?ys=2025RS