SB 641
Department of Legislative Services
Maryland General Assembly
2021 Session
FISCAL AND POLICY NOTE
Third Reader
Senate Bill 641 (Senator Elfreth)(Chair, Joint Committee on Pensions)
Budget and Taxation Appropriations
State Retirement and Pension System - Fiduciary Insurance
This bill authorizes the State to satisfy a statutory requirement that it purchase a bond for
each fiduciary of the State Retirement and Pension System (SRPS) by instead purchasing
an insurance policy. The Treasurer, in consultation with the SRPS Board of Trustees, must
determine the type and amount of coverage provided by the insurance policy. The bill
takes effect June 1, 2021.
Fiscal Summary
State Effect: None. The bill conforms statute to current practice.
Local Effect: None.
Small Business Effect: None.
Analysis
Current Law: The State must purchase a bond for each fiduciary of SRPS, which is
required for a fiduciary to exercise custody or control of any SRPS assets. A fiduciary may
not allow another fiduciary to act in violation of the bonding requirement.
The Maryland State Employees Surety Bond Committee – which consists of the State
Treasurer, State Comptroller, and the Attorney General or their designees – is authorized
to periodically set the type and amount of the bonds for each State officer and employee
who is required to be bonded by statute, as specified.
Background: The State Retirement Agency (SRA) notified the Joint Committee on
Pensions (JCP) that the statutory language regarding bonding of system fiduciaries was
largely obsolete due to the system maintaining a $1 million employee theft insurance policy
that covers direct loss or damage to money, securities, or other property caused by theft or
forgery committed by an SRA employee or member of the Board of Trustees. JCP agreed
to sponsor legislation to conform statute to current practice. The Governor’s proposed
fiscal 2022 budget includes $203,700 for the insurance policy premium.
Additional Information
Prior Introductions: None.
Designated Cross File: HB 844 (Delegate Lierman)(Chair, Joint Committee on Pensions)
- Appropriations.
Information Source(s): Maryland State Treasurer’s Office; State Retirement Agency;
Department of Legislative Services
Fiscal Note History: First Reader - February 8, 2021
an/vlg Third Reader - March 3, 2021
Analysis by: Michael C. Rubenstein Direct Inquiries to:
(410) 946-5510
(301) 970-5510
SB 641/ Page 2


Statutes affected:
Text - First - State Retirement and Pension System - Fiduciary Insurance: 21-210 State Personnel and Pensions
Text - Third - State Retirement and Pension System - Fiduciary Insurance: 21-210 State Personnel and Pensions