§ 4–504
Statutes in effect as of October 1, 2026.
Md. Code Ann., Pub. Util. § 4-504 (2026)
Title 4. Rate Regulation
Subtitle 5. Prohibitions
§ 4–504LinkCopy Citation
(a)
(1)
In this section the following words have the meanings indicated.
(2)
(i)
“Bonus” means a form of direct or indirect payment, consideration, or compensation that is paid or conveyed to an employee of a public service company in addition to the employee’s base pay.
(ii)
“Bonus” includes:
(1)
compensation that the public service company does not formally label as a bonus payment;
(2)
any form of incentive compensation the fact and amount of which is under the discretion of the public service company until a time close to the end of the period for which the incentive payment is paid; and
(3)
payments given in addition to base pay that are contingent on the occurrence of one or more events or conditions.
(3)
(i)
“Compensation” means a form of payment or consideration conveyed to or for the benefit of an employee of a public service company, the parent company of a public service company, or any other affiliate of a public service company in connection with the employee’s work for a public service company.
(ii)
“Compensation” includes:
(1)
direct and indirect methods of conferring benefits;
(2)
cash and noncash benefits;
(3)
salary, bonuses, period payments, and severance pay; and
(4)
the value of a perquisite, compensatory or paid leave, or other benefit not excluded under subparagraph (iii) of this paragraph.
(iii)
“Compensation” does not include any expenditure of a public service company for health, medical, dental, vision, or life insurance or disability pay.
(4)
“Supervisor” means an employee of a public service company, the parent company of a public service company, or any other affiliate of a public service company who:
(i)
using the employee’s independent judgment:
(1)
is authorized by the employee’s employer to hire, transfer, suspend, lay off, recall, promote, discharge, assign, reward, or discipline other employees;
(2)
is responsible for directing the work performance of other employees; and
(3)
is responsible for responding to employee complaints; or
(ii)
is employed in a bona fide executive capacity under the federal Fair Labor Standards Act.
(b)
This section applies only to a public service company that is an investor–owned electric company, gas company, or combination gas and electric company.
(c)
A public service company may not recover through rates any costs associated with:
(1)
membership, dues, sponsorships, or contributions to an industry trade association, group, or related entity exempt from taxation under § 501(c)(6) of the Internal Revenue Code;
(2)
the acquisition, use, or allocation of costs associated with a private plane that is owned or leased by the public service company or its holding company; or
(3)
compensation for a supervisor that exceeds 110% of the maximum annual salary payable to the chair of the Commission for the same calendar year.
(d)
(1)
The board of directors of each public service company shall adopt a company–wide policy placing reasonable cost limitations on expenditures that the public service company intends to recover through rates for:
(i)
entertainment and events;
(ii)
office and facility renovations;
(iii)
transportation services, including aviation;
(iv)
staff development activities or events;
(v)
performance incentives; and
(vi)
other activities outside the scope of the normal course of business operations.
(2)
Each public service company shall send a copy of the policy adopted under paragraph (1) of this subsection to the Commission:
(i)
as soon as practicable; and
(ii)
each time the policy is updated, but not less than once every 5 years.
(3)
The Commission may review in a base rate proceeding the reasonableness of the cost limitations in a policy adopted under paragraph (1) of this subsection.