This section does not apply to: an elected official; the head of a unit of a county or municipality who reports directly to: the chief administrative officer of the county or municipality; an elected executive; or the governing body of the county or municipality; or the chief administrative officer of the county or municipality. Except as provided in paragraph (2) of this subsection, a county or municipality may not require an employee to reside in the State, county, or municipality or within a specified distance of the State, county, or municipality as a condition of employment. A county or municipality may require an at–will supervisory employee to reside in the State, county, or municipality or within a specified distance of the State, county, or municipality as a condition of employment if the at–will supervisory employee reports directly to the head of a unit of the county or municipality. Subject to subsection (c) of this section, when making employment, promotion, demotion, layoff, and discharge decisions, a county or municipality may not discriminate based on an individual’s place of residence. A county or municipality may grant a resident of the State, county, or municipality additional points or credits in employment or promotion decisions if the points or credits are provided in accordance with a merit system established by the county or municipality by local law or ordinance. An agency created under State law that provides governmental services to more than one county or municipality may not require an employee, as a condition of employment, to reside in the State or a county or municipality or within a specified distance of the State, a county, or a municipality for which the agency provides governmental services.