# Natural Resources (GNR)

## Title 8. Waters

### Subtitle 2A. Chesapeake and Atlantic Coastal Bays 2010 Trust Fund

#### Section 8-2A-01

(a) In this subtitle the following words have the meanings indicated.

(b) "Aggregator" means a person that facilitates or coordinates the establishment of practices or projects that:

  (1) Are implemented by the person or by others;

  (2) Produce a quantifiable environmental outcome;

  (3) Are registered by the person; and

  (4) Are made available for purchase by the State.

(c) "BayStat Program" means the program established under Sec. 8-2A-03 of this subtitle.

(d) "Environmental outcome" means a commodity that is modeled or directly measured as a single, quantifiable, and certified unit of improvement to the environment, including a nutrient or carbon benefit.

(e) "Evaluator" means a person other than an aggregator that determines whether environmental outcomes have been achieved based on defined performance measures.

(f)

  (1) "Nonpoint source pollution control project" means a project to improve water quality by a reduction of nitrogen, phosphorus, or sediment pollution.

  (2) "Nonpoint source pollution control project" includes:

    (i) An agricultural best management implementation practice, including cover crops, riparian forested buffer, manure processing, grassed waterways, animal waste storage structures, and livestock fencing;

    (ii) An urban or suburban stormwater practice;

    (iii) A sustainable forest management practice, including a forest stewardship plan or a nonornamental urban and suburban tree planting project;

    (iv) Stream and wetland restoration;

    (v) Riparian buffer planting;

    (vi) A project that demonstrates the effectiveness of an innovative nonpoint source pollution reduction measure provided that the measure is capable of integration into existing nonpoint source pollution programs;

    (vii) Technical assistance necessary to implement a nonpoint source pollution control project;

    (viii) Improvement of a municipal park located on or adjacent to a waterway, provided that the improvement is limited to state-of-the-art and sustainable nonpoint source pollution control measures that demonstrably improve water quality by reducing nitrogen, phosphorus, and sediment pollution; and

    (ix) Strategic monitoring of water quality improvements from nonpoint source pollution control projects that have been funded, in whole or in part, with grants from the Trust Fund.

(g) "Quantification plan" means a plan in which an aggregator describes:

  (1) The method that will be used to measure or model environmental outcomes and co-benefits;

  (2) The compliance monitoring that will occur to ensure that the proposed actions are taken and maintained over the life of the project;

  (3) Verification steps that will be carried out by the State or an evaluator to confirm model results or accurate measurement of environmental outcomes; and

  (4) The timeline for proposed payments under a contract with the State.

(h) "Trust Fund" means the Chesapeake and Atlantic Coastal Bays 2010 Trust Fund.

(i) "Watershed implementation plan" means a plan to achieve the nutrient and sediment limits required under the Chesapeake Bay total maximum daily load.

#### Section 8-2A-02

(a) There is a Chesapeake and Atlantic Coastal Bays 2010 Trust Fund.

(b) The purpose of the Trust Fund is to provide financial assistance necessary to advance Maryland's progress in meeting the goals established in the 2014 Chesapeake Bay Watershed Agreement for the restoration of the Chesapeake Bay and its tributaries, including the Patuxent River, and to restore the health of the Atlantic Coastal Bays and their tributaries, by focusing limited financial resources on nonpoint source pollution control projects in all regions of the State.

(c) The Secretary shall administer the Trust Fund.

(d)

  (1) The Trust Fund is a special, nonlapsing fund that is not subject to Sec. 7-302 of the State Finance and Procurement Article.

  (2) The Treasurer shall hold the Trust Fund separately, and the Comptroller shall account for the Trust Fund.

(e) The Trust Fund consists of:

  (1) Money appropriated in the State budget for the Trust Fund;

  (2) Money distributed to the Trust Fund under Sec.Sec. 2-1104 and 2-1302.1 of the Tax - General Article; and

  (3) Any other money from any other source accepted for the benefit of the Trust Fund.

(f)

  (1) The Trust Fund may be used only for the implementation of nonpoint source pollution control projects to:

    (i) Support State and local watershed implementation plans by targeting limited financial resources on the most effective nonpoint source pollution control projects; and

    (ii) Improve the health of the Atlantic Coastal Bays and their tributaries.

  (2) It is the intent of the General Assembly that, when possible, money in the Trust Fund shall be granted to local governments and other political subdivisions for agricultural, forestry, stream and wetland restoration, and urban and suburban stormwater nonpoint source pollution control projects, including up to 25% in matching funds to local governments and other political subdivisions that have enacted a stormwater remediation fee under Sec. 4-202.1 of the Environment Article.

  (3)

    (i) In each fiscal year from 2023 through 2031, inclusive, $1,250,000 from the Trust Fund shall be used to fund:

      (1) The 5 Million Tree Program Coordinator position in the Department of the Environment; and

      (2) Subject to subparagraph (ii) of this paragraph, 13 contractor positions in the Forest Service of the Department to provide technical assistance, planning, and coordination related to tree plantings, tree buffer management, and forest management, including invasive vine removal, on public, private, and agricultural lands and in "underserved areas" as defined in Sec. 8-1911 of this title.

    (ii) The Department shall make reasonable efforts to ensure that contractors hired under subparagraph (i)2 of this paragraph reflect the geographic and demographic diversity of the State.

  (4)

    (i) In each fiscal year from 2024 through 2031, inclusive, $2,500,000 from the Trust Fund shall be used, subject to the requirements of subparagraph (ii) of this paragraph, for tree plantings on public and private land.

    (ii) The money appropriated under this paragraph:

      (1) May be distributed in accordance with Sec. 8-2A-04(c)(2) of this subtitle;

      (2) May be used to cover the costs of:

      (A) Site preparation, labor, and materials for tree-planting projects;

      (B) Maintaining trees following a tree-planting project; and

      (C) Landowner incentive payments or signing bonuses of up to $1,000 per acre of trees planted;

      (3) May not be used to plant trees intended for timber harvest; and

      (4) May be used only for tree plantings on private land if the landowner enters into a binding legal agreement to maintain the planted area in tree cover for at least 15 years.

    (iii) Money appropriated under this paragraph is supplemental to and may not take the place of funding that otherwise would be appropriated for tree plantings on public and private land.

  (5) In each fiscal year from 2026 through 2030, inclusive, up to $100,000 from the Trust Fund shall be used to fund the operations grants under Sec. 8-2B-02(g)(3) of this title at a rate of $20,000 per project sponsor each fiscal year.

  (6) Notwithstanding any other provision of law, the Governor may include in the annual budget bill an appropriation of up to $10,500,000 from the Trust Fund to support operating expenses of the Department.

(g)

  (1) The Treasurer shall invest the money of the Trust Fund in the same manner as other State money may be invested.

  (2) Any investment earnings of the Trust Fund shall be retained to the credit of the Trust Fund.

(h) Money expended from the Trust Fund for the restoration of the Chesapeake and Atlantic Coastal Bays and their tributaries, including the Patuxent River, is supplemental to and is not intended to take the place of funding that otherwise would be appropriated for bay restoration.

#### Section 8-2A-03

(a)

  (1) There is a BayStat Program to:

    (i) Measure and evaluate efforts to restore the Chesapeake and Atlantic Coastal Bays; and

    (ii) Administer the Trust Fund.

  (2) The BayStat Subcabinet shall oversee the administration of the BayStat Program.

  (3) The BayStat Subcabinet is composed of:

    (i) The Secretary of Natural Resources;

    (ii) The Secretary of the Environment;

    (iii) The Secretary of Planning;

    (iv) The Secretary of Agriculture;

    (v) The President of the University of Maryland Center for Environmental Science;

    (vi) The Dean of the College of Agriculture and Natural Resources at the University of Maryland, College Park Campus; and

    (vii) The chair of the Critical Area Commission for the Chesapeake and Atlantic Coastal Bays.

(b) The BayStat Program shall:

  (1) Provide accurate and timely data to policymakers and the public about the efficacy and cost-effectiveness of local, State, and federal programs to restore the Chesapeake and Atlantic Coastal Bays;

  (2) Track and assess the progress of State and federal programs to improve the health of the Chesapeake and Atlantic Coastal Bays;

  (3) Assess the effectiveness of enforcement programs in curbing pollution and achieving Chesapeake and Atlantic Coastal Bays restoration goals and institute actions to improve the effectiveness of enforcement programs;

  (4) Adopt measurable goals for Chesapeake and Atlantic Coastal Bays restoration;

  (5) Identify new threats to the health of the Chesapeake and Atlantic Coastal Bays;

  (6) Increase public awareness of, and participation in, efforts to restore the vitality of the Chesapeake and Atlantic Coastal Bays; and

  (7) Direct the administration of the Trust Fund.

(c) The BayStat Subcabinet shall:

  (1) Report annually to the public regarding:

    (i) The health of the Chesapeake Bay tributary basin;

    (ii) The health of the Atlantic Coastal Bays and their tributaries;

    (iii) The status of local, State, and federal programs to restore the Chesapeake and Atlantic Coastal Bays; and

    (iv) Estimated nutrient reductions achieved through projects financed by the Trust Fund; and

  (2)

    (i) Develop an annual work plan that identifies the planned work to be funded with money from the Trust Fund for the next fiscal year, including annual nutrient and sediment reduction targets, performance measures, and accountability criteria; and

    (ii) Develop an annual expenditure plan that identifies planned expenditures for the work plan and includes an accounting of all money distributed from the Trust Fund in the previous fiscal year.

(d) The Governor shall submit the annual work and expenditure plans to the General Assembly as part of the annual budget submission.

(e)

  (1) On an annual basis the BayStat Subcabinet shall prepare a final work and expenditure plan based on the budget approved by the General Assembly.

  (2) Beginning with the plan prepared for fiscal year 2024, the plan shall be informed by the analysis carried out by the BayStat Program Scientific Advisory Panel under Sec. 8-2A-04(g)(4)(vii) of this subtitle.

#### Section 8-2A-04

(a) The BayStat Program shall direct the administration of the Trust Fund in accordance with this section.

(b)

  (1) The BayStat Program shall implement nonpoint source pollution reduction measures to:

    (i) Support State and local watershed implementation plans by targeting limited financial resources on the most effective nonpoint source pollution control projects; and

    (ii) Improve the health of the Atlantic Coastal Bays and their tributaries by targeting funds, geographically and by practice, to proven, scientifically based projects that provide the most cost-effective and measurable water quality benefits to the Atlantic Coastal Bays and their tributaries.

  (2) To the maximum extent practicable, the BayStat Program shall distribute the Trust Fund money on a competitive basis.

(c)

  (1) The BayStat Program shall distribute funds from the Trust Fund to the BayStat Subcabinet agencies in accordance with the final work and expenditure plans.

  (2) The BayStat Subcabinet agencies shall administer the funds in accordance with the final work and expenditure plans, including the distribution of funds:

    (i) Through grants to:

      (1) Counties;

      (2) Bicounty agencies;

      (3) Municipalities;

      (4) Forest conservancy district boards;

      (5) Soil conservation districts;

      (6) Academic institutions; and

      (7) Nonprofit organizations having a demonstrated ability to implement nonpoint source pollution control projects;

    (ii) To the Chesapeake and Atlantic Coastal Bays Nonpoint Source Fund established under Sec. 9-1605.3 of the Environment Article;

    (iii) To the Maryland Agricultural Cost-Share Program established under Title 8, Subtitle 7 of the Agriculture Article for nonpoint source pollution control projects;

    (iv) To the Green Shores Program established under Sec. 5-429 of this article;

    (v) To the Mel Noland Woodland Incentives Fund established under Sec. 5-307 of this article; and

    (vi) Subject to paragraph (4) of this subsection, through the procurement of nutrient- or sediment-related environmental outcomes under a pay-for-success contract or any other procurement method authorized under Division II of the State Finance and Procurement Article.

  (3) The BayStat Program shall:

    (i) Develop solicitations, guidelines, and applications for Trust Fund grants and contracts that shall include consideration of the extent to which a proposed project, both geographically and by practice, will deliver the greatest, most cost-effective, and measurable nonpoint source pollution reduction per Trust Fund dollar; and

    (ii) In evaluating Trust Fund applications, encourage and consider:

      (1) Multi-year, multi-partner proposals, local match or cost-share agreements, or similar actions proposed by an applicant;

      (2) Projects that, in addition to providing cost-effective and measurable nonpoint source pollution reductions, provide co-benefits including:

      (A) The restoration of aquatic resources, such as seagrass beds or oyster reefs;

      (B) Climate resilience;

      (C) Carbon sequestration;

      (D) Creation of wildlife habitat;

      (E) Local employment opportunities;

      (F) The improvement or provision of recreational opportunities; or

      (G) Environmental justice benefits; and

      (3) Subject to paragraph (5) of this subsection, multi-year agreements whereby an aggregator proposes to:

      (A) Combine funding from the Trust Fund with revolving loan funds authorized under Sec.Sec. 9-1605 and 9-1605.1 of the Environment Article, Federal Emergency Management Agency hazard mitigation support, or private sources of funding; and

      (B) Use the combined sources to fund and administer the implementation of multiple projects or pay for environmental outcomes from multiple completed projects.

  (4)

    (i) Funds from the Trust Fund may not be used to procure environmental outcomes achieved before January 1, 2021.

    (ii) Payment under a pay-for-success contract may be made only after an evaluator has certified to the contracting agency that the environmental outcomes have been measured or modeled consistent with an approved quantification plan.

  (5) A BayStat Subcabinet agency may use funding from the Trust Fund for a multi-year agreement specified under paragraph (3)(ii)3 of this subsection only if the agency determines that the agreement will:

    (i) Provide cost-effective nutrient and sediment reductions in a manner consistent with the cost-effectiveness of other projects supported through the Trust Fund;

    (ii) Deliver benefits consistent with those required by revolving loan funds authorized under Sec.Sec. 9-1605 and 9-1605.2 of the Environment Article;

    (iii) Require not more than 20% of total resources in the Trust Fund; and

    (iv) Deliver co-benefits as described in paragraph (3)(ii)2 of this subsection.

(d) Any grant or contract agreement regarding funds from the Trust Fund shall:

  (1) Specify the use of the funds provided under the grant, accountability measures, and performance requirements;

  (2) Take into account the need for efficient, multi-year funding and administration; and

  (3) Include provisions for verification that practices are being implemented.

(e)

  (1) A recipient of funds from the Trust Fund in any fiscal year shall submit an annual report to the BayStat Program by November 1 of the next fiscal year.

  (2) The report required under paragraph (1) of this subsection shall include:

    (i) For agencies receiving money from the Trust Fund:

      (1) A description of how the funds were allocated, including:

      (A) The number and amounts of grant awards; and

      (B) Direct expenditures by the agency;

      (2) How funding was leveraged; and

      (3) Estimated or calculated nutrient reductions associated with Trust Fund expenditures.

    (ii) For recipients of competitive grants or pay-for-success contracts from the Trust Fund, a description of funded projects, including:

      (1) Project location;

      (2) Description of practices implemented;

      (3) Timeframes for project completion;

      (4) Estimated or calculated nutrient reductions; and

      (5) Provisions for long-term maintenance of practices.

(f) Funds from the Trust Fund may not be used to enable an individual cited for noncompliance with a nonpoint source pollution control law or regulation to achieve compliance.

(g)

  (1) There is a BayStat Program Scientific Advisory Panel.

  (2) The Governor shall appoint the chair and members of the BayStat Program Scientific Advisory Panel.

  (3) The BayStat Program Scientific Advisory Panel shall include scientists and other technical experts with demonstrated expertise in the disciplines related to protection and restoration of the Chesapeake and Atlantic Coastal Bays.

  (4) The BayStat Program Scientific Advisory Panel shall:

    (i) On or before August 1, annually provide recommendations to the BayStat Subcabinet on the use of funds of the Trust Fund for the following fiscal year;

    (ii) Monitor the distribution of funds from the Trust Fund;

    (iii) Review the categories of grants and contracts made in the previous year to assess nutrient loading reduction estimates and cost efficiencies and the effectiveness of any innovative nonpoint source pollution reduction measure;

    (iv) Review the proposed annual work plan and advise the BayStat Subcabinet of any recommended changes;

    (v) On request by the BayStat Subcabinet, review individual funding applications;

    (vi) Annually review any Trust Fund money that is not distributed on a competitive basis to assess whether that money may be distributed on a competitive basis; and

    (vii) On or before January 31, 2023:

      (1) Analyze and compare the fund distributions through the competitive program and by each BayStat Subcabinet agency for fiscal years 2012 through 2023 and the strategies supported by those distributions;

      (2) Quantify the relative effectiveness of each distribution and strategy per dollar of State funding; and

      (3) Report to the BayStat Subcabinet, the Governor, and, in accordance with Sec. 2-1257 of the State Government Article, the General Assembly on the results of the analyses required under items 1 and 2 of this item.

(h) The BayStat Subcabinet agencies may:

  (1) Distribute to an administrative cost account the amount that is necessary to administer grant programs, not to exceed 1.5% of the allocations to the BayStat Subcabinet agencies; and

  (2) Maintain an amount, not to exceed 2% of the total in competitive grants and contracts administered by the BayStat Subcabinet agencies, for the purpose of meeting additional project needs, including:

    (i) The adaptive management, maintenance, or catastrophe-induced repair needs of projects funded by the grants or contracts; and

    (ii) Paying for quantified and verified water quality-related environmental outcomes that exceed the quantity of environmental outcomes anticipated under particular grants or contracts.

#### Section 8-2A-05

(a) As part of the Department's Chesapeake Bay Mainstem and Tidal Water Quality Monitoring Program, the Department shall conduct long-term sample collection in tributaries located on the lower Eastern Shore.

(b) At a minimum, the Department shall regularly collect samples from each of the following locations:

  (1) Stations TRQ0088 and TRQ0146, located in the Transquaking River;

  (2) Station CCM0069, located in the Chicamacomico River;

  (3) Station XDJ9007, located in the Nanticoke River;

  (4) Station XCI4078, located in the Wicomico River;

  (5) Stations BXK0031 and MNK0146, located in the Manokin River; and

  (6) Stations POK0087 and XAK7810, located in the Pocomoke River.

(c) To the extent practicable, water quality monitoring carried out under this section shall be done in locations where water quality monitoring was conducted prior to December 1, 2013, in order to allow the Department and the public to assess long-term water quality trends.

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Md. Code Ann., Nat. Res. (as displayed at mgaleg.maryland.gov, October 16, 2026)