The interim is when I get to step back and think about how to provide the best possible service as a nonpartisan analyst to the Maryland General Assembly. These are my personal reflections—not the views of the Department of Legislative Services—and an attempt to deepen my understanding of the process we support. Writing these reflections should also help me keep up my practice during the interim.
What Is a Fiscal and Policy Note?
In Maryland, a fiscal and policy note (most often referred to as a fiscal note) estimates the impact of proposed legislation on State and local revenues and expenditures for the year the bill takes effect and the following four fiscal years. They are prepared by the nonpartisan staff of the Department of Legislative Services (DLS).
Under State Government Article § 2-1505, a standing committee may not vote on a bill unless a fiscal note accompanies it. The only exception is when the committee chair certifies that prompt action is required. In that case, a hearing may proceed, and the fiscal note must be prepared as soon as possible afterward.
Though designed primarily for legislators and staff, fiscal notes must also be reasonably available for public inspection and retained for three years. DLS meets this requirement by posting them online through the Maryland General Assembly website. In practice, fiscal notes are frequently read by advocates, journalists, and members of the public—often more so than the bills themselves. Their structure and language are designed to be accessible, providing context that plain bill text may lack.
Despite popular belief, fiscal notes are not binding, but they are influential. They are trusted because they are developed by neutral, nonpartisan staff using the best available information at the time. A fiscal note can clarify the cost of a proposal, highlight technical drafting issues, and influence the success or failure of legislation. When a bill fails to advance, members or advocates sometimes say it “had a fiscal note,” shorthand for saying the estimated cost or uncertainty may have been too high.
DLS also produces revised fiscal notes when bills are amended or enrolled. These must be sent to committee chairs in both chambers (if applicable), the Secretary of the Senate or Chief Clerk of the House (if in custody), and the primary bill sponsor. Revised notes are posted to the website as soon as they are finalized.
Core Components of a Fiscal and Policy Note
1. Bill Summary
Fiscal notes contain two summaries:
- Short Summary (on page one): Conveys the core purpose of the bill, effective date (if not October 1), and any required reports. It aims for clarity and accuracy while avoiding legalese.
- Long Summary (in the body): Expands on details that didn’t fit in the short summary. This includes more nuanced provisions and often provides needed structure to understand complex bills.
2. Fiscal Summary
The fiscal summary includes a brief explanation of:
- State Effect
- Local Effect
- Small Business Effect
If there’s a quantifiable impact on State revenues or expenditures, a five-year fiscal table (“the box”) is included. State or local mandates are noted in bold.
3. Current Law
This section summarizes the relevant existing law. The summary should match the level of detail in the bill summary, neither overwhelming nor too sparse.
4. Background
Background sections appear in administration or departmental bills. These often include relevant statistics, policy history, or data that provide context for the bill’s purpose.
5. Fiscal Impact Sections
State Fiscal Impact
Details the bill’s projected fiscal effect by fund type and agency. Expenditures and revenues are generally discussed separately unless the issues are intertwined. Analysts describe:
- What changes drive the impact
- How estimates were calculated
- Any assumptions or unknowns
Under § 2-1505, agencies are required to promptly provide data upon request, but final estimates are made by DLS analysts. Sources are listed at the end of the note.
Local Fiscal Impact
This section mirrors the state fiscal impact, estimating changes to local revenues and expenditures. It is typically a separate section but may be combined when impacts cannot be cleanly separated.
Small Business Impact
Summarizes any material effects on small businesses, if applicable.
Additional Comments
Used sparingly, this section flags issues such as ambiguous drafting, conflicts with current law, or implementation barriers that don’t fall neatly into the fiscal analysis.
What Fiscal Notes Don’t Cover
Fiscal notes do not estimate the impact on individual residents or model secondary effects (like economic multipliers or indirect behavioral changes) unless those can be reasonably and directly linked to the bill.
Conclusion
Fiscal and policy notes are one of the most import tools in the legislative process. They serve as a neutral lens through which to assess the fiscal and policy consequences of proposed legislation. Their strength lies in their structure, clarity, and impartiality. When written well, they guide decisions, spark better questions, and provide a roadmap for implementation.
