DLS analysis recommends diverting Program Open Space funds; DNR, stakeholders warn of broad program cuts

The Department of Legislative Services (DLS) presented a fiscal 2026 review of the Department of Natural Resources (DNR) budget during the House Appropriations Committee Transportation and the Environment Subcommittee hearing, recommending the diversion of Program Open Space (POS) transfer‑tax receipts to the state general fund to help address near‑term fiscal stress. DLS analyst Andrew Gray said the overall DNR operating allowance “increases $26,100,000 or 6.4% to $435,600,000 in fiscal 20 26.”

The recommendation to shift POS and related special‑fund resources would, DLS explained, reduce funding flowing to local POS accounts by half, suspend funding for the Maryland Agricultural Land Preservation Foundation (MALPF) and the Rural Legacy program for fiscal 2026 through 2029, and expand use of the Chesapeake and Atlantic Coastal Bays 2010 Trust Fund as a possible source for general‑fund relief. Gray later clarified the budget reconciliation proposal as approximately $48.8 million in fiscal 2026 rising to about $115.8 million in fiscal 2029 as part of the fiscal‑stability package presented to the subcommittee.

DNR Secretary Josh Kurtz and agency staff told the committee the DLS recommendations would have widespread effects beyond DNR programs. “If these fund reductions were adopted,” Kurtz said, the state would not meet several statutory or policy goals and core programs — including the Whole Watershed Act implementation, cover‑crop support, and local non‑point‑source pollution projects supported through the trust fund — would be directly affected. Kurtz said the department had placed a $10.5 million operating request from the Chesapeake and Atlantic Coastal Bays trust fund into the BRFAA (budget reconciliation) submission to help cover Maryland Park Service operations.

Why it matters: Program Open Space and the Chesapeake/Atlantic Coastal Bays trust fund support land acquisition, agricultural easements, park development and non‑point‑source pollution projects across every county. Witnesses from land trusts and conservation groups told lawmakers that diverting these funds would disrupt long pipelines of projects — including easements, park acquisitions and local resilience work — and would reduce leverage of federal and nonprofit matching funds.

What was said and shown - DLS analyst Andrew Gray outlined DNR program trends, noting declines in some recreational licensing and concerns about fisheries indicators. He framed the transfer proposals as discretionary options for the committee in a difficult budget year and listed specific programs that would be affected if POS and trust fund balances were tapped for general fund purposes. - Gray: “the revenues being about $64 60 5 million dollars per year,” (as presented in the analysis) and later stated the BRFAA transfer estimates as “$48,800,000 or so in fiscal 20 26, growing to around $115,800,000 in fiscal 20 29.” - Secretary Josh Kurtz described specific program impacts: Maryland Department of Agriculture (MDA) would lose an estimated $23.1 million from the trust fund; MALPF would lose $21.6 million annually from POS; Maryland Department of the Environment (MDE) would lose $1.09 million that supports matching for the Whole Watershed Act. Kurtz noted the trust fund closing balance for the current fiscal year as about $33,960,000 and projected the balance would drop in FY26 if proposed projects are funded. - Local impact: DLS and DNR staff said POS local payments total about $25,400,000 in the current fiscal year; under the DLS recommendation local jurisdictions could receive roughly half of their usual POS local allocation.

Stakeholder testimony and committee concerns Conservation and local‑land stakeholders delivered consistent testimony opposing the DLS diversion proposal: - Kristen Kirkwood, executive director of Harford Land Trust and board chair…