The MACPA’s 2016 legislative efforts are off to an impressive start.
House Bill 171, which would lower the appeal bond cap for small businesses (those with 250 or fewer employees) to $5 million, has earned a unanimous 138-0 vote from Maryland’s full House of Delegates.
The issue is still being considered by the Senate in the form of Senate Bill 231.
Here’s why the measure is important: Due to the increasing complexity of business today, it is not unusual to see lawsuits with extraordinarily high damages and a high possibility of questionable verdicts in lower courts. This puts Maryland CPAs in an awkward position of having to post a bond that could bankrupt or financially harm a firm or business in order to pursue the matter further in the appellate process.
Last year, the MACPA backed a bill that changed Maryland’s appeal bond law by adding a $100 million cap on such bonds. The bill provided some important liability protection for Maryland’s largest CPA firms. The MACPA had sought an additional cap of $1 million for small businesses last year, but that provision was removed from the final version of the bills.
This year, we are supporting a move to lower the appeal bond cap for small businesses to $5 million, a move we believe is critical to provide small businesses with access to the appeal bond system.
Additionally, lowering the appeal bond cap applicable to small businesses from the $100 million level – a level that would be catastrophic for many small businesses, including CPA firms and other businesses — will strengthen Maryland’s business climate.