ANNAPOLIS -- Maryland's title companies won Round One in a legislative fight that they said threatened to raise home settlement costs by imposing millions of dollars in taxes on the industry.
The victory came from Sen. Walter M. Baker, D-Cecil, the sponsor of a bill that would have required title companies to pay the state some of the interest they earn by holding client trust accounts.
Currently, law firms, which do many of the same real estate settlement services as title companies, must give up that earned interest to the non-profit Maryland Legal Services Corp., which funds legal programs for the poor.
Mr. Baker's bill would have pooled the law firm and title company interest in one state-controlled fund to finance legal services and housing services for the poor, among other things.
But Mr. Baker, who is chairman of the Judicial Proceedings Committee, announced at a committee hearing yesterday that he decided to change the bill to remove the title company requirement. That would leave a bill that still imposes state control on the legal services funds -- which amounted to about $5 million last year -- collected from law firms.
But the title industry still faces a threat to the interest from client trust accounts.
Another bill, sponsored by Clarence W. Blount, D-Baltimore, chairman of the Senate Economic and Environmental Affairs Committee, would set up a state low-income housing fund, financed by title company interest.