Comptroller Franchot’s Statement on Board of Revenue Estimates September Revisions

Comptroller Peter Franchot, chairman of the Board of Revenue Estimates (second from left), along with (from right) Marc Nicole, deputy secretary of the Maryland Department of Budget and Management, Chief Deputy Treasurer Bernadette T. Benik and Andrew Schaufele, director of the Bureau of Revenue Estimates and executive secretary of the board, met Wednesday afternoon in the Assembly Room of the Louis L. Goldstein Treasury Building in Annapolis.

ANNAPOLIS, Md. (September 20, 2017) – Today, the Board of Revenue Estimates voted to reduce the revenue projections for the State of Maryland for Fiscal Year 2018 by $53 million, representing a 0.3 percent decrease over prior estimates. The Board also unveiled the first official estimates for fiscal year 2019, which is projected to be $17.6 billion, representing a $73.5 million reduction.

The actions are largely driven by weaker-than-anticipated sales tax revenues, which are the result of sluggish income growth, changing buying habits with more online purchases being made and tepid consumer confidence stemming from uncertainty about potential federal government cuts and other actions.
Following are Comptroller Franchot’s remarks, as prepared for delivery:

“This action comes just weeks after we closed the books on Fiscal Year 2017 with $90 million above our original projections, which provides reason for restrained optimism.
“The proposed reductions in FY 2018 and FY 2019’s estimates are primarily influenced by the continued weak growth in sales and use tax revenue, and a modestly reduced outlook for average wage growth in Maryland. In this revision, the largest write-down is the sales and use tax projected revenues, which underscores the fact that consumer spending remains unpredictable.

“Following a very brief but relatively successful holiday season, sales tax revenue declined this past spring. Over the last several fiscal years, we’ve barely attained 2% growth in sales and use tax revenues. Our prior estimates had generally held that the State would at least see 3% to 3.5% growth. But we know these figures are influenced in large part by the meager income growth that we continue to experience, and the political uncertainties coming out of Washington.

“As we continue to weather these uncertain economic conditions, Maryland working families are understandably putting more money in the piggy bank instead of spending on things they want, instead of need.

“In this consumer-powered economy, far too many businesses – and in particular, small and locally-owned businesses that are the backbone of the Maryland economy — are struggling to survive at a time when consumers are reining in their discretionary spending.

“We continue to experience the slowest and most tentative economic recovery of our lifetimes. And as I’ve said in the past, I think that it would be imprudent to expect a return to pre-recessionary patterns of economic expansion.

“To be prepared for the fiscal uncertainties of the future, I believe fiscal policymakers need to consider this rate of growth in our revenues as the “new normal,” if you will. And I would encourage my fellow state leaders to adopt this approach when making spending and fiscal policy decisions in the months ahead.”

“I do want to tip my hat to Governor Hogan and to the General Assembly for continuing to exercise fiscal restraint and for recognizing the fiscal and economic realities that our state faces today. More than anything else — and I know both the Governor and the General Assembly are in bipartisan agreement on this — we must establish a business climate that is characterized by stability and predictability, one in which employers feel comfortable investing capital and creating good-paying, long-term jobs.

“We must avoid decisions that take more money out of the pockets of consumers who are already reluctant to put money back into the Maryland economy, which is why we need to continue to reject any proposals that would increase or create new taxes and fees.

“We need to provide some stability and relief for our working-class citizens and small businesses. And furthermore, we must remain smart and forward-thinking about how we spend limited taxpayer dollars and resist adding to our existing state debt — recognizing the fact that we simply cannot sustain continued debt accumulation that can be dangerous to our fiscal stability in the years ahead.

“The fiscal realities we face require us to invest in the things that we need, and forego many of the things that we simply want. This is the same principle that so many households and business owners use when planning and executing their own budgets — and we have a solemn responsibility to do the same as their elected representatives.

“I am confident that if we continue on the current path of fiscal prudence, we will be well-positioned to emerge from these economic and fiscal challenges stronger than before. And we will be properly prepared to weather future disturbances in our economy.”

View the data here.

Media contacts: Joe Shapiro, 410-260-7305 (office) 443-871-2244 (cell)
Alan Brody 410-260-6346 (office) 443-924-1473 (cell)

 

Comptroller’s Call Center Approved By Board of Public Works

ANNAPOLIS, Md. (September 20, 2017) – Reinforcing his commitment to exceptional taxpayer service, Comptroller Franchot today thanked his Board of Public Works colleagues for their unanimous approval of the lease agreement for his office’s new customer call center, which will open in Hagerstown in early January, in time for the start of the 2018 tax filing season. The new center will be located at Franklin Plaza, 33 W. Franklin Street, in downtown Hagerstown. It will enhance the ability of the Maryland Comptroller’s Office to provide better customer service while adding 12 full-time jobs to the area’s economy.

“I am very proud of my Office’s longstanding reputation for respectful, responsive and results-oriented customer service,” said Comptroller Franchot. “By providing these additional phone lines and additional agents, our new call center will further enhance our ability to serve taxpayers throughout the state. We also are thrilled to bring new jobs and economic activity to downtown Hagerstown and to be a part of the city’s ongoing renaissance. I would like to thank my Board of Public Works colleagues – Governor Hogan and Treasurer Kopp – for their unanimous and enthusiastic support of this exciting new initiative.”

The new center’s staff will assist Marylanders with tax questions and tax payment options. The agency’s Taxpayer Services unit in Annapolis typically swells from 35 to 75 employees during the height of the tax season to handle the volume of taxpayer inquiries. Last January, the agency opened its first remote call center in Salisbury to lend greater assistance to taxpayers from all regions of the state. The new Hagerstown call center will continue the Comptroller’s efforts to respond quickly and effectively to taxpayers’ queries.

City and county leaders expressed appreciation for the new call center and applauded today’s action.

“The city is excited to have the Comptroller’s new Call Center in downtown Hagerstown, and these new jobs will be a great contribution to our local economy,” said Mayor Bob Bruchey. “This call center will provide an important service to people across Maryland who have important tax questions, and having the call center in downtown Hagerstown will help make the process more efficient and effective for everyone.”

“Once again, Comptroller Franchot working with Governor Hogan has demonstrated that not only does he seek efficiency with taxpayer funds, but also his agency focuses on excellent customer service,” said State Senator Andrew Serafini, District 2. “His commitment to downtown Hagerstown and our efforts for revitalization is truly appreciated by our local community.”

“We say congratulations, and I want to thank Mr. Franchot for providing job opportunities to Washington County,” said Washington County Commission President Terry L. Baker. “We love Peter Franchot in Washington County and we thank him for everything he does for us.”

The approval of this latest call center comes just months after the Office of the Comptroller opened a new regional branch office in Hagerstown. That office, located in the Crystal Building at 1850 Dual Highway, is open to the public on weekdays from 8:30 a.m. to 4:30 p.m.

Training for the new hires will begin at the Hagerstown office this fall. Anyone interested in one of the positions may go to https://www.jobaps.com/MD/ for more information and to apply.

Media Contacts: Joseph Shapiro, 410-260-7305 (office), 443-871-2244 (cell)
Alan Brody, 410-6346 (office), 443-924-1473 (cell)

 

Comptroller Franchot Extends Tax Relief and Assistance to Help Hurricane Irma Victims

ANNAPOLIS, Md. (September 11, 2017) – In the aftermath of the destruction and damage caused by Hurricane Irma throughout Florida, Comptroller Peter Franchot today announced a plan to ease the suffering of victims trying to recover from this monstrous natural disaster. The Comptroller has:

• Issued a temporary waiver of certain IFTA requirements and Motor Fuel Tax returns for companies affected by the storm.
• Granted a fuel waiver concerning conventional and reformulated gasoline to ensure the supply of gasoline in the State of Maryland.
• Named agency contact personnel to assist taxpayers and businesses with other tax filings.

“Floridians have been through a traumatic evacuation, a massive hurricane and now have to return to their homes to begin the daunting task of storm clean-up and getting their basic needs met,” Comptroller Franchot said. “Our goal is to make sure individuals and businesses affected by this giant hurricane can focus on clean-up and rebuilding their communities as they start to put their lives back together. We stand ready to assist and to ease any burdens that we can.”

The Comptroller has granted a temporary waiver of certain International Fuel Tax Agreement requirements. The waiver will help ensure the rapid restoration of utilities and allow essential emergency relief supplies and aid personnel to reach the affected areas. The waiver pertains only to shippers and carriers of essential emergency relief supplies and aid personnel or those restoring utilities. It is effective from September 11 through November 30.

For Maryland Motor Fuel Tax license holders in Florida who may have difficulty filing their August 2017 and September 2017 returns by the monthly deadline, the Comptroller has granted a waiver of interest and penalty for those holders. Those affected by the waiver must file their August 2017 and September 2017 Motor Fuel Tax returns by November 30, 2017.

The Comptroller’s Office also will allow the production, sale and distribution of conventional gasoline (CG) in reformulated gasoline (RFG) control areas in an effort to simplify the supply of fungible gasoline throughout the region affected by fuel supply emergencies caused by Hurricane Irma.

The Comptroller also has authorized a temporary increase in the Reid Vapor Pressure limits. The fuel waiver request concerning conventional and reformulated gasoline was made by the Maryland Department of the Environment in conjunction with the Environmental Protection Agency to ensure adequate supplies of gasoline for Maryland consumers.

Anyone with questions or concerns may call Chuck Ulm, assistant director within the Field Enforcement Division (FED), at 410-260-7278; or Nathan Essey, regulatory and licensing section manager/hearing officer for FED, at 410-260-7498.

Certain tax types also could be affected. Those types include: withholding, sales and use, individual non-resident, corporate, admission and amusement and alcohol and tobacco. Because the categories and specific circumstances vary, these instances will be handled on a case-by-case basis. Anyone from Florida who files in Maryland and has a tax concern involving tax return dates is asked to call or email Karen Scheerer, special assistant to the Comptroller, at 410-260-4020 or ombudsman@comp.state.md.us.

For other tax-related questions, individuals may call 410-260-7980 (from Central Maryland) or 1-800-MD-TAXES, or email taxhelp@comp.state.md.us. Businesses may call the Tax Practitioner Hotline at 410-260-7424.

MEDIA CONTACT: Joe Shapiro, 410-260-7305 (office); 443-871-2244 (cell)
Alan Brody, 410-260-6346 (office); 443-924-1473 (cell)

Taxpayers Urged to Prepare as Hurricane Irma Threatens East Coast

ANNAPOLIS, Md. (September 8, 2017) — September is National Preparedness Month and the Internal Revenue Service and Maryland Comptroller Peter Franchot are offering advice to taxpayers who may be affected by storms, fires, floods or other disasters.

“As we saw with the destructive tornado in Kent Island in July, it’s important to be prepared for unexpected events throughout the year, but especially during this turbulent weather season,” Comptroller Franchot said.

National Preparedness Month is managed and sponsored by the Federal Emergency Management Agency and the Ready Campaign, which encourage individuals, businesses and organizations to prepare for a variety of disaster and emergency situations. Here are a few ways taxpayers can prepare:

• Create Electronic Copies of Key Documents: Make duplicate sets of key documents, including bank statements, tax returns, identifications and insurance policies and keep them in a safe place, such as a waterproof container away from the original set. Many financial institutions provide statements and documents electronically, and much financial information is available on the internet. Paper documents can be scanned into an electronic format so taxpayers can download them to a storage device such as an external hard drive or USB flash drive, burn them to a CD or DVD or store them in the cloud.

• Document Valuables: Photograph or videotape the contents of any home, especially items of higher value to make it easier to quickly claim any available insurance and tax benefits after a disaster strikes. The IRS has a disaster loss workbook, Publication 584, which can help taxpayers compile a room-by-room list of belongings. Photographs can help an individual prove the fair market value of items for insurance and casualty loss claims. Ideally, photos should be stored online or with a friend or family member who lives outside the area.

• Check on Fiduciary Bonds: Employers who use payroll service providers should ask the provider if it has a fiduciary bond in place. The bond could protect the employer in the event of default by the payroll service provider.

• Update Emergency Plans: Review emergency plans annually, since situations change over time as do preparedness needs. When employers hire new employees or when a company or organization changes functions, plans should be updated accordingly and employees should be informed of the changes. Make plans ahead of time and be sure to practice them.

In the event of a federally-declared disaster, taxpayers can call 866-562-5227 to speak with an IRS specialist trained to handle disaster-related issues. For federal taxes, back copies of previously-filed tax returns and all attachments, including Forms W-2, can be requested by filing Form 4506, Request for Copy of Tax Return. Alternatively, transcripts showing most line items on these returns can be ordered through the Get Transcript link on IRS.gov, by calling 800-908-9946 or by using Form 4506T-EZ, Short Form Request for Individual Tax Return Transcript, or Form 4506-T, Request for Transcript of Tax Return. Maryland taxpayers in need of state tax assistance can call the taxpayer services line from 8:30 a.m. to 4:30 p.m. weekdays at 1-800-MD TAXES or 410-260-7980, or visit www.marylandtaxes.com.

For more information about National Preparedness Month, visit Ready.gov/September.

 

 

Maryland State Fair Goers Find More Than $300K in Unclaimed Property

ANNAPOLIS, Md. (September 6, 2017) – Comptroller Peter Franchot today announced that nearly 300 people discovered more than $300,000 in unclaimed funds after visiting his agency’s booth at the Maryland State Fair this summer. One visitor discovered an unexpected windfall of $71,516. Throughout the summer, Comptroller Franchot’s staff worked the unclaimed property booths at county fairs and the State Fair as part of an initiative to help reunite Marylanders with money they are owed. This year, more people found unclaimed property at a higher total dollar amount than at last year’s fair, possibly due to higher attendance. More than 1,400 people made inquiries at the unclaimed property booth at the fair in 2017.

“It’s our duty and pleasure to return unclaimed funds to their rightful owners,” Comptroller Franchot said. “Each day, we vigorously work to find the owners of the unclaimed property and to make sure they get what they are owed.”

Financial institutions, utilities, insurance companies and other corporations are required to report to the Comptroller any bank accounts, security deposits, wages, insurance benefits and contents of safe deposit boxes that have been unclaimed after three years. In addition to his booths at fairs and festivals, the Comptroller’s Office searches for owners of unclaimed funds by searching tax records and Motor Vehicle Administration files to try and locate property owners.

Franchot urges anyone who finds their name on the list to contact his office at 410-767-1700 (Central Maryland) or toll-free at 1-800-782-7383 to find out how to reclaim their lost property. Marylanders can also see if their name is on the list through www.marylandtaxes.com.

MEDIA CONTACT: Joe Shapiro, 410-260-7305 (office); 443-871-2244 (cell)

Franchot Releases FY 17 Closeout Numbers

ANNAPOLIS, Md. (September 1, 2017) –  Emphasizing the need for fiscal caution during these uncertain economic times, Comptroller Peter Franchot today released the final closeout numbers for Fiscal Year 2017. General fund revenues totaled nearly $16.7 billion in the fiscal year, 0.5% or $90.3 million above estimates. However, the uncertain fiscal times and moderate wage growth translated into conservative consumer spending and sluggish growth in sales and use taxes.

After final transfers and revenues were counted, the State of Maryland closed the fiscal year with an unassigned General Fund balance of $256.3 million. By law, all but $10 million of this money is required to be appropriated in the Fiscal Year 2019 budget with $50 million going to the State Pension System and $196.3 million going into the Rainy Day Fund.

“While I am obviously pleased that the State has managed to outperform our modest forecasts, it is important that we put these numbers into their proper context,” said Comptroller Franchot. “We are living in very uncertain economic times and the dysfunction in Washington has the potential to impact Maryland more than most states. I urge the Governor and the General Assembly to steer a prudent course and save this money rather than putting it back into our state’s spending pattern.”

View the Closeout Report here.

 

MEDIA CONTACT: Joe Shapiro, 410-260-7305 (office); 443-871-2244 (cell)

Comptroller Offers Tax Relief and Assistance to Hurricane Harvey Victims

ANNAPOLIS, Md. (August 31, 2017) – In the aftermath of the unprecedented destruction and suffering caused by Hurricane Harvey in Texas and Louisiana, Comptroller Peter Franchot today announced a plan to help ease the burdens of those trying to recover from this catastrophic event. The Comptroller has:

• Issued a temporary waiver of IFTA requirements and Motor Fuel Tax returns for companies affected by the storm,
• Granted a fuel waiver concerning conventional and reformulated gasoline to ensure the supply of gasoline in the State of Maryland,
• Named a point person to assist taxpayers and businesses with other tax filings.

“The people of Texas and Louisiana are now focused on making sure their families are safe and getting their basic needs met for food, shelter and medical attention,” Comptroller Franchot said. “Our primary focus is to make sure businesses and individuals affected by this life-changing storm can focus on cleaning up and rebuilding their city and communities as they begin to recover and put their lives back together. My office is ready to assist and ease any burdens we can.”

The Comptroller has granted a temporary waiver of certain International Fuel Tax Agreement requirements. The waiver will help ensure the rapid restoration of utilities and allow essential emergency relief supplies and aid personnel to reach the affected areas. The waiver pertains only to shippers and carriers of essential emergency relief supplies and aid personnel or those restoring utilities.

For Maryland Motor Fuel Tax license holders in Texas and Louisiana who may have difficulty filing their July 2017 and August 2017 returns, the Comptroller has granted a waiver of interest and penalty for those holders. Those affected by the waiver must file their July 2017 and August 2017 Motor Fuel Tax returns by October 31, 2017. 

The Comptroller’s Office also will allow the production, sale and distribution of conventional gasoline in reformulated gasoline control areas in an effort to simplify the supply of fungible gasoline throughout the region affected by fuel supply emergencies caused by Hurricane Harvey.

The Comptroller has authorized a temporary increase in the Reid Vapor Pressure limits. The fuel waiver request concerning conventional and reformulated gasoline was made by the Maryland Department of the Environment in conjunction with the Environmental Protection Agency to ensure adequate supplies of gasoline for Maryland consumers.

Certain tax types also could be affected. Those types include: withholding, sales and use, individual non-resident, corporate, admission and amusement and alcohol and tobacco. Because the categories and specific circumstances vary, these instances will be handled on a case-by-case basis. Anyone from Texas or Louisiana who files in Maryland and has a tax concern involving tax return dates is asked to call or email Karen Scheerer, special assistant to the Comptroller, at 410-260-4020 or ombudsman@comp.state.md.us.

For other tax-related questions, individuals may call 410-260-7980 (from Central Maryland) or 1-800-MD-TAXES, or email taxhelp@comp.state.md.us. Businesses may call the Tax Practitioner Hotline at 410-260-7424.

MEDIA CONTACT: Joe Shapiro, 410-260-7305 (office); 443-871-2244 (cell)

Alan Brody, 410-260-6346 (office); 443-924-1473 (cell)

Comptroller Franchot Warns Taxpayers of New Phishing Scheme Impersonating IRS and FBI

ANNAPOLIS, Md. (August 29, 2017) – Comptroller Peter Franchot is warning taxpayers to avoid a new phishing scheme that impersonates the Internal Revenue Service and the FBI as part of a ransomware scam to take computer data hostage.

The IRS says the scam email uses emblems of both and the Federal Bureau of Investigation. It tries to entice users to select a “here” link to download a fake FBI questionnaire. Instead, the link downloads a certain type of malware called ransomeware that prevents users from accessing data stored on their device unless they pay money to the scammers.

“If you receive an email like this, don’t reply, download or respond in anyway. These tax scammers are after your hard earned money and personal financial information,” Comptroller Peter Franchot said. “My agency stands ready to help any Maryland taxpayer who gets an email like this and we remain vigilant in our united goal to protect citizens from these con artists.”

The IRS, state tax agencies and tax industries – working in partnership as the Security Summit – are conducting an awareness campaign called Don’t Take the Bait that includes warning tax professionals about the various types of phishing scams, including ransomware.

  • Victims should not pay a ransom. Paying it further encourages the criminals, and frequently the scammers won’t provide the decryption key even after a ransom is paid.
  • Victims should immediately report any ransomware attempt or attack to the FBI at the Internet Crime Complaint Center, www.IC3.gov. Forward any IRS-themed scams to phishing@irs.gov.

 The Comptroller’s Office and the IRS do not use email, text messages or social media to discuss personal tax issues, such as those involving bills or refunds. If you are a tax professional and registered e-services user who disclosed any credential information, contact the IRS e-Services Help Desk to reset your e-service password.

The Comptroller’s Office also advises taxpayers not to reply to phone calls or emails asking for confidential information, most especially Social Security numbers, birth dates, salary information or home addresses. To report a problem, Maryland taxpayers may call 1-800-MD-TAXES or send an email to mdcomptoller@comp.state.md.us.

MEDIA CONTACT: Joe Shapiro, 410-260-7438 (office), 443-871-2244 (cell)

Alan Brody, 410-260-6346 (office), 443-924-1473 (cell)

Comptroller Franchot Releases FY 17 Figures for Alcohol, Cigarette and Fuel Violations

ANNAPOLIS, Md. (August 24, 2017) – Reinforcing his agency’s continued commitment to aggressively enforce Maryland’s tax laws, Comptroller Peter Franchot today announced the final figures for alcohol, cigarette and motor fuel violations for fiscal year 2017. Making the announcement surrounded by contraband products, Franchot praised the work of his agents and other law enforcement agencies in working together to protect law-abiding businesses from underground operations and tax cheats.

“The blatant disregard of Maryland tax laws, which protect law-abiding businesses and consumers, will not be ignored,” said Comptroller Franchot. “I am very proud of the diligent efforts of my field enforcement agents and inspectors to stop criminals and their contraband. These enforcement actions, along with the stricter penalties we’ve been able to enact, send a clear message that this type of illegal activity will not be tolerated in Maryland and that criminals will be punished.”

For fiscal year 2017, which ended June 30, Comptroller agents issued 87 cigarette violations resulting in the confiscation of a total of 103,190 packs of cigarettes and 87,561 packages of Other Tobacco Products (OTP) with a combined retail value of $738,415. This represents a tax loss of more than $254,000. FY 2017 saw an increase in the amount of confiscated alcohol. This past year saw 250 gallons of distilled liquor, 9.39 gallons of wine and more than 1,186 containers of beer confiscated along with the issuance of 25 violations. The total retail value of the seized alcohol was $42,843. The gallons of distilled liquor and containers of beer confiscated represent an increase of more than 100 percent from FY 2016.

In addition to alcohol and tobacco violations, FED inspectors issued 120 motor fuel and International Fuel Tax Agreement (IFTA) violations, a decrease from the previous fiscal year which speaks to the integrity of the motor fuel retailers throughout the state and the Agency’s reputation for being a strict regulator. In addition, more than $217,000 of delinquent sales and use tax was collected by FED agents, all of which goes to the state’s general fund.

Contraband alcohol and tobacco products are retained by the Comptroller’s Office as evidence against a defendant until the pending case is adjudicated. The Comptroller’s Office is required by state law to destroy or sell the product, with the exception of beer which must be destroyed due to its short shelf life. Only licensed Maryland retailers or wholesalers can bid on seized alcohol or tobacco lots sold. All money collected from these sales is deposited in the general fund.

“My office remains committed to ensuring a level playing field for all Maryland businesses. We will continue to work with law enforcement officials on the local, state and federal levels to keep contraband alcohol and tobacco products out of Maryland communities,” Franchot said.

Media Contacts: Joseph Shapiro, 410-260-7305 (office), 443-871-2244 (cell)
Alan Brody, 410-6346 (office), 443-924-1473 (cell)

Comptroller Branch Office in Upper Marlboro Closed for Remainder of Monday, August 21

ANNAPOLIS, Md. (August 21, 2017) – The Comptroller’s Office branch location in the Prince George’s County Courthouse in Upper Marlboro will be closed for the remainder of today due to the lack of air conditioning in the building. Taxpayers may visit Comptroller offices in Greenbelt and in Annapolis at the Revenue Administration Center, which are open with regular hours from 8:30 a.m. to 4:30 p.m. daily. Taxpayers in need of free state tax assistance can continue to call the taxpayer services line from 8:30 a.m. to 4:30 p.m. at 1-800-MD TAXES, or 410-260-7980.

MEDIA CONTACT: Vicki Fisher – 410-260-7816 (office), 443-534-6259 (cell)