23-05-2025
Moore allows payday loan bill, other measures to become law without his signature
Gov. Wes Moore (D) will allow a handful of bills to become law without his signature rather than issue vetoes. (File photo by Bryan P. Sears/Maryland Matters)
A bill meant to regulate so-called 'earned wage access' loans for the first time in Maryland will become law without the governor's signature and over the objections of a coalition that strongly opposed it.
House Bill 1294 is one of a handful of bills that Gov. Wes Moore (D) will allow to become law without his signature, including a measure to clarify provisions of a clean-energy building standard and other to increase oversight of the Department of Information Technology. Moore cited beneficial elements for each bill, but also pointed to provisions that were potentially troublesome, leading him to withhold his signature.
The bills are the last gasp of a month in which the governor signed almost 800 bills from the 2025 General Assembly into law and they come a week after he announced vetoes of 23 measures, including his controversial veto of a bill to create a commission to study possible reparations. Lawmakers are expected to override that veto, if not others.
In Maryland, there is no pocket veto for the governor, who must veto a bill to reject it. Of the left-over bills, the most contentious may have been HB1294, which aims to regulate 'earned wage access' programs that advance workers money they have earned but have not yet received, then requires them to pay it back with interest.
Critics say the bill as drafted exempts app-based lenders from state laws that 'prohibit lending that is discriminatory, is deceptive, or carries extremely high interest rates.' The Center for Responsible Lending said in a statement that the new law makes it easier for Marylanders to be sucked into 'financial quicksand' because of payday loan apps.
'The bill becoming law but without the governor's signature is indicative of serious, widespread concerns about these payday loan apps, including from the governor's administration,' said Whitney Barkley, deputy director of state policy and senior policy counsel for the Center for Responsible Lending.
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The center was part of a coalition of more than three dozen advocates, including the NAACP Maryland State Conference, that had urged Moore to veto the bill.
Earned wage access programs typically come in two versions – one offered by employers to their employees and another offered by private companies directly to workers. The loan is typically paid back through automatic deductions, usually with a fee or 'tip.'
Opponents said the tips are finance charges. Often those charges exceed 300% interest, higher than the state's 33% limit. They said the new law 'removes the best defense against predatory lending' in Maryland.
In a letter explaining his decision, the governor said early access to earned wages can 'provide a tangible benefit to workers' with unexpected expenses such as flat tires, medical copays and veterinarian bills.
While he commended lawmakers, including House Economic Matters Chair Del. C.T. Wilson (D-Charles), for 'advancing a path on regulating these products,' Moore also acknowledged concerns with the bill.
Roughly 345,000 residents used wage access apps more than 11 million times between 2019 and 2024, in transactions totaling about $108 million. Nearly one in four accessed the service every two weeks, 'suggesting habitual use,' Moore wrote. About half pay 'expedited fees.'
Those who default on the loans tend to be 65 or older, earning less than $50,000 a year and users tend to live 'in the lowest income communities in the state,' Moore wrote, adding that 'protections are warranted.'
He called for a cap on amounts that can be borrowed from a single or multiple lenders, and said the law should not exempt lenders from existing commercial financial protection laws. Finally, soliciting a tip for a loan 'is inappropriate,' Moore wrote.
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The governor also took a pass on House Bill 49, which would help clarify key provisions of the Building Energy Performance Standards. Some building owners could receive credits, including for generating renewable energy on-site.
The bill was requested by the Department of the Environment, Moore withheld his signature over changes made by the legislature. In a letter explaining his decision, Moore cited 'constrained (budget) resources' and 'significant operational challenges' for the department, which must implement the law.
'And overall, this bill, as amended by the General Assembly, undermines the Department's regulatory flexibility to meet the climate goals set out in the Climate Solutions Now Act,' Moore wrote.
The bill, as requested by the department, was intended to provide flexibility to building owners who must comply with electrification requirements and reach net-zero greenhouse gas emissions by 2040. Failure to do so will result in fees — some as much as $600,000 for poor performing buildings — levied by the Maryland Department of the Environment.
But lawmakers amended the bill to exempt hospitals and some manufacturing facilities. Also exempted are emissions associated with steam sterilization and back-up generators at medical facilities, nursing homes and laboratories.
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Moore said he is also 'concerned with the study requirement included in the bill,' which calls on the department to analyze other potential changes to the BEPS program. The governor said the amended bill 'introduces uncertainty into an already complex regulatory effort … It is not clear that the expectations of this study can be met by the department, given the fiscal constraints and timeline challenges the law has put in place.'
Moore will also allow House Bill 738 and Senate Bill 705 to become law without his signature.
The identical bills — sponsored by Del. Anne Kaiser (D-Montgomery) and Sens. Sens. Katie Fry Hester (D-Howard and Montgomery) and Stephen S. Hershey Jr. (R-Upper Shore) — aim to refocus the Department of Information Technology on major projects and ensure compliance with auditors' recommendations.
The law imposes new oversight and reporting requirements on a department who has come under fire from lawmakers and the Office of Legislative Audits. One top lawmaker characterized the agency as a money pit.
A key part of the bill expands and defines the responsibilities of the department secretary on oversight of major IT projects, and it bars the department from contracting for IT services or products that are not consistent with its master plan. The law also requires the department secretary to meet quarterly with the chief information officer of agencies or departments with planned or ongoing IT projects.
It also sets up an expert panel to advise the legislature on IT issues and requires the Senate Budget and Taxation and House Health and Government Operations committees to convene a work group to evaluate the bill and other potential changes. The work group will determine if other actions are needed to resolve issues raised by the auditor.
Moore, in a three-page letter, said he agreed that changes needed to be made to how major information technology projects are overseen. But while the bills are 'well-intended,' he said 'many of its provisions recycle ineffective policies from the past, mirror reforms that are already underway or are overly prescriptive.'
