Veterans capital plans on hold after federal grant miss; secretary urges Burial Equity Act to restore eligibility

Yoshadar Arai, budget analyst for the Department of Legislative Services, presented the department’s fiscal 2026 capital analysis and told the Capital Budget Subcommittee that federal grant timing and eligibility are the main uncertainties for several veterans cemetery and facility projects.

Arai reported that fiscal 2026 includes $113,000 in general obligation (G.O.) geobonds for the Crownsville Veterans Cemetery expansion and improvement project to continue project design. The analyst said the federal Department of Veterans Affairs (VA) requires no state residency requirement for state cemetery grant eligibility, but Maryland law currently requires Maryland residency for burial at state veteran cemeteries. "Two departmental bills, House Bill 138 and Senate Bill 237 introduced this session aim to remove the state residency requirement making the state eligible for the federal grant program," Arai said.

Arai also reported the new state veterans home project is on hold because the state did not receive the anticipated federal grant award. The governor’s fiscal 2026 plan includes a proposed transfer of $62,900,000 from the Dedicated Purpose Account (DPA) for that project to the general fund; the fiscal 2025 federal appropriation of $47,900,000 is canceled. After the proposed transfer and cancellation, $2,500,000 would remain in the DPA to complete design work, and the project would have a prior appropriation balance of $6,700,000 for design (including $4,200,000 previously transferred in FY23). Arai said the state’s application currently ranks 80 out of 81 projects on the VA priority‑1 list; Arai described a large unfunded backlog at the federal level and said roughly $1.1 billion in projects would need funding before Maryland’s project becomes eligible for award.

Secretary Anthony Woods of the Department of Veterans and Military Families told the committee the department is moving forward with renovation work at Charlotte Hall Veterans Home and recently certified funds to begin design and engineering studies. "Just last week we signed our fund certification and we're working in collaboration with DGS to begin a part 1 and part 2 analysis or design and engineering study essentially of how we can move forward with renovating that space to bring it in line with the U.S. Department of Veterans Affairs new standards," Woods said. Woods said Charlotte Hall occupancy has declined from 403 residents in December 2019 to 271 in December 2024.

Arai summarized other project timing issues: the Crownsville design is scheduled to begin in March 2025 and is fully funded with state-authorized funds that would be reimbursed through a federal grant if the state becomes eligible; the Garrison Forest Veterans Cemetery expansion first received funding in FY24 but its FY26 funds have been deferred to FY27 because of the same residency-eligibility issue. Arai told the committee DLS recommended approving $113,000 in geobonds for Crownsville to continue design.

Committee members asked about alternative approaches to serving unhoused veterans and longer-term options if federal funding remains unavailable. Secretary Woods described the Maryland Veteran Trust Fund, which issues individual emergency financial grants and can help veterans avoid eviction or pay security deposits, and said the department is exploring "aging in place" options and other alternatives that can bridge gaps while the state pursues renovation and new-construction options. Woods also noted that one option would be to fund the entire new home with state dollars — a project the analyst estimated would cost about $200,000,000 — but that would mean waiting for federal reimbursements if a federal award later occurs.

DLS and the department highlighted quantitative findings in the analysis: the state’s veteran population estimate declined from 348,000 (fiscal 2023) to 340,000 (fiscal 2024); Charlotte Hall occupancy fell from 403 to 271 between December 2019 and December 2024; DLS reported the state needs roughly 1,100 veteran facility beds; and the department reported approximately 312 unhoused veterans in 2024 (101 in emergency shelters, 173 in transitional housing and about 38 unsheltered).

The presentation concluded with a DLS request that the department brief the committee on the federal ranking of both cemetery projects and the likelihood of receiving federal awards to begin construction in FY27. No formal vote was held during the hearing.