On June 5, 2025, Governor Wes Moore signed into law Maryland’s Fiscal Year 2026 budget and the Procurement Reform Act of 2025 during the final bill signing ceremony of the session. The $67.3 billion budget closes a multibillion-dollar structural deficit without increasing broad-based taxes and prioritizes investments in education, infrastructure, and public safety. The Procurement Reform Act, passed earlier in the week, modernizes how the state does business, focusing on efficiency, equity, and economic development.

The new law brings significant benefits to small and disadvantaged businesses. It doubles the threshold for procurements reserved for small businesses and mandates that the state pay small business vendors within 15 days instead of 30. The master contract method is also revised, raising the thresholds for task order solicitations and requiring agencies to rotate solicitations among smaller groups of master contractors. These changes expand opportunity, reduce delays, and create a more dynamic vendor pool.

Several provisions directly impact how vendors compete. The law now requires oral presentations for contracts over $10 million for construction, $5 million for IT or professional services, and $2 million for architecture/engineering. It also allows Minority Business Enterprise (MBE) participation goals to be modified even after a contract is awarded. Vendors must submit workforce or supplier diversity plans, and proposals will now be scored on Good Labor Practices, reinforcing Maryland’s commitment to inclusive and ethical contracting.

Finally, the law expands the authority of the Chief Procurement Officer and establishes a new technical procurement team within the Department of Information Technology to improve cost-effective sourcing. Oversight of transportation-related procurement, including IT, is consolidated under the Maryland Department of Transportation and Maryland Transportation Authority. The law also requires a study on the economic impacts of in-state vendor preference, with findings due by December 1, 2025. The state will require the use of interns or registered apprentices on certain contracts, linking procurement to workforce development.

More information on Maryland’s FY 2026 Budget and Legislation can be found, here.

More information on Maryland’s Procurement Reform Act of 2025 can be found, here.