Emergency Management Budget Highlights Heavy Federal Dependence and an $86 million Documentation Gap

Department of Legislative Services analyst Yashoda Rai presented the Maryland Department of Emergency Management's (MDEM) fiscal 2027 analysis on Feb. 20, warning that the department's budget is heavily driven by pass‑through federal grants and that recent federal policy shifts have made FEMA funding less predictable.

DLS said the fiscal 2027 allowance increases by about $65.6 million (7.5%) after contingent reductions and noted that approximately 73% of the allowance relates to pass‑through federal grants for presidentially declared disasters. The analysis highlighted two buffer provisions under consideration that would expand allowable uses of the Strategic Energy Investment Fund (SIF/CIF) and the 9‑1‑1 trust fund; one proposed swap would reduce federal funds by $3.2 million and replace them with 9‑1‑1 trust fund special funds, raising a potential federal compliance issue.

Rai also described an Office of Legislative Audit repeat finding that MDEM could not document a total of $86,000,000 in accrued federal fund revenue entries dating back to 2020, much of it expenditures made on behalf of other state agencies for which federal reimbursement requests had not been submitted as of the audit deadline. DLS recommended a committee narrative requiring MDEM to report on federal fund sources, contingency plans, and status of reimbursement recoveries.

Secretary Russell Strickland told lawmakers that MDEM has worked with OAG on litigation that restored a federal mitigation grant program (BRIC) and prevented added federal terms that would have been difficult to meet; he said the department is adjusting to a changed federal landscape in which meeting prior damage thresholds may no longer guarantee federal disaster assistance. Strickland said MDEM's operational budget is heavily federal—about 80%—and urged maintenance of state disaster funds such as the catastrophic event account and state disaster recovery fund in view of uncertain federal support.

Committee members pressed for further detail on the $86 million in unapproved reimbursement requests, the status of awards for resiliency revolving loan projects, and the legal exposure of proposed fund swaps. MDEM and DBM were asked to provide follow‑up information about contingency plans if federal funds cannot be used as currently assumed.