The system was meant to fix what the Maryland State Department of Education itself has described as an antiquated platform that made it hard to track payments to childcare providers and staff. The project began in 2022 with a target completion date of January 2026. But in November 2025, the department paused the work to reassess its scope, business rules and system requirements, according to the Fiscal Year 2027 Maryland Executive Budget analysis.

The Canton Group, a Baltimore-based vendor, received tens of millions of dollars under the contract to modernize the online system, records show.

The disclosure lands as the state's childcare scholarship program has grown rapidly. The program, which provides cash assistance to income-eligible families with children under 13, or under 19 with a qualifying disability, received $560 million in taxpayer funding in 2026 — more than a 300% increase from 2022.

As funding surged, the education department lacked adequate information systems to track the money, resulting in at least $10.7 million paid out in error, State Board of Education President Joshua Michael acknowledged. Internal state audits from 2023 to 2025 identified $66.5 million in overpayments to childcare providers statewide, and the state has said it will not recoup the $10.7 million.

In response to questions, the education department blamed "previous leadership" for the stalled modernization, saying the new system "was built on the same shaky foundation that caused the original problems." The department said its focus now is on "correcting the underlying problems."

Much of the $44 million was spent while current State Superintendent of Schools Carey Wright has led the department. Wright took the post in 2023, and development of the updated system was halted in 2025.

Chris Peusch, of the Maryland State Child Care Association, a nonprofit that supports providers, said the failures are a drag on an industry that is otherwise trying to do right by families.

"This is not a good system," Peusch said. "It wasn't prepared well. It wasn't executed well."

Peusch said the state's flawed online systems make it difficult even to determine the true scale of errors and what payments should be recovered. Asked whether Maryland should have ensured a working system was in place before pouring hundreds of millions of dollars into the program, Peusch said, "Sure. That would seem logical."

She added that the problems "hurt the rest of the industry that is doing the best they can and trying to do what's right."

Combined with the unrecouped overpayments, the state now appears to have misspent nearly $55 million in taxpayer money — $10.7 million in erroneous payments and $44 million for a system that was never implemented.

The episode raises questions for Maryland families and taxpayers about how the state oversees a program that now distributes more than half a billion dollars a year, and whether the department can account for that money without the modern tools it was funded to build.