Maryland Audit Finds $32.5M Paid For Failed State Procurement System

ANNAPOLIS, Md. — Maryland’s Office of State Procurement failed to properly oversee a major statewide purchasing system and did not recover tens of millions of dollars after the project collapsed, according to a legislative audit released Dec. 19, 2025.

The audit by the Maryland Office of Legislative Audits found that the Department of General Services’ Office of State Procurement paid $32.5 million for the eMaryland Marketplace Advantage system, even though the system did not function as intended and produced incomplete and inaccurate procurement records. Auditors said the state ultimately terminated the contract but did not attempt to recover damages or assess liquidated penalties allowed under the agreement.

The eMaryland Marketplace Advantage system was intended to modernize how state agencies solicit bids, manage contracts and process payments. Instead, auditors found that the system largely operated as a bid-posting platform and failed to properly integrate with the state’s Financial Management Information System, creating reconciliation problems and forcing the state to hire an outside accounting firm at a cost of $1.6 million to determine actual contract balances.

The audit also concluded that a senior procurement employee improperly used a Minority Business Enterprise subcontractor on the eMMA contract to route payments to other vendors, circumventing state procurement rules and MBE participation goals. Auditors said the arrangement resulted in excessive administrative fees, in some cases exceeding the cost of the underlying services. The employee was terminated and the matter referred to the Office of the Attorney General in December 2023.

Beyond the failed technology project, auditors identified long-standing weaknesses in procurement oversight. The report said the Office of State Procurement failed to establish procedures to ensure required administrative fees were included in contracts processed through eMMA, resulting in at least $2 million in uncollected fees from six contracts reviewed. Similar findings had appeared in multiple prior audits dating back to 2016.

Auditors also found that the office did not adequately monitor procurement authority delegated to state agencies, did not consistently publish contract awards within required timeframes, and could not document key records supporting some contract awards. In several cases, sole-source contracts were approved without required justification or Board of Public Works approval.

The audit further raised concerns about contracts intended to benefit individuals with disabilities. According to the report, eight contracts totaling $16.5 million had no hours worked by disabled individuals during fiscal year 2024, despite program requirements. Oversight failures related to these contracts had been cited repeatedly in audits dating back more than a decade.

In a written response included with the report, the Department of General Services said it generally agreed with the audit’s recommendations but disputed certain characterizations, including the conclusion that the eMMA system did not function as intended. Auditors responded that the system’s deficiencies and resulting costs supported their findings and said they reaffirmed the accuracy of the report after reviewing the agency’s comments.

The Office of Legislative Audits said it will continue to monitor corrective actions and advise lawmakers on any issues that remain unresolved.

Read the full audit report below:

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