Maryland officials are pledging that people receiving food and cash benefits will get new, more secure cards with chip technology next summer, after a prolonged and messy process to hire a company to print and distribute the cards.

The new cards are necessary to prevent benefits from being stolen and fraudulently used — a problem that has left recipients without their needed aid and has cost the state more than $42 million over the past three years. The cards are used by Marylanders enrolled in the Supplemental Nutrition Assistance Program, Temporary Cash Assistance, and Temporary Disability Assistance Program.

The state’s spending board voted Wednesday to award a multiyear contract potentially worth up to $38 million to Fidelity Information Services of Milwaukee. Fidelity will start right away to transition from the current company that oversees benefits cards, with the goal of issuing new cards starting July 1.

The new cards “will make benefits access seamless and safer” for Marylanders, state Human Services Secretary Rafael López said in a statement. “In the face of unprecedented challenges, Maryland is taking action to secure and safeguard taxpayer dollars.”

About 943,000 Marylanders are enrolled in SNAP food benefits or cash assistance that are accessed through the cards.

For years, the theft of benefits has been a challenge, with the benefits cards themselves being part of the problem. The cards lack the security features of credit cards and bank cards, making them susceptible to card skimmers used by fraudsters to steal important information and sell the data online.

Though the federal government provides the money for the benefits, the state must use its own money to replace stolen benefits, to the tune of $42.6 million since March 2023.

The problem caught the attention of state lawmakers, who passed a law in 2023 requiring the state to transition to cards with chip technology.

But the process of hiring a company to make the cards has been the focus of a messy legal battle. The Department of Human Services initially awarded the new contract in 2024 to a New Jersey-based company called Conduent that had held the contract since 2007.

Conduent’s chief rival, Fidelity, lodged protests to the contract award and prevailed before a state contract appeals board and in Circuit Court. Amid those legal challenges, the Department of Human Services had to extend Conduent’s contract temporarily last December, earning a rebuke from members of the Board of Public Works.

López, the human services secretary, had a tense exchange with Comptroller Brooke Lierman at that meeting. He wasn’t present at Wednesday’s meeting, sending instead his chief of staff, Webster Ye.

Ye asked the Board of Public Works to approve Fidelity as the new contractor — even though Conduent is continuing to fight, with a case pending before the Appellate Court of Maryland.

“To be very clear, we made a mistake last year. We’re back before you today to course correct that,” Ye said.

Lierman responded: “I think in the words of my 7-year-old: I told you so.” She later apologized for being “a little bit glib.”

Given that the state is losing money and people are hurt by losing benefits, Lierman said it’s important for the card transition to get under way. “I want this to move as quickly as possible to get those chip cards deployed,” she said.

Lierman, Treasurer Dereck Davis and Gov. Wes Moore, the three Democrats who comprise the Board of Public Works, all voted for the new contract with Fidelity.

Fidelity will be paid $7.7 million for the next nine months during a transition period away from Conduent. Then they’ll be paid $16.7 million for a six-year base term, plus two options for two-year extensions at a cost of $7 million each — for a total maximum contract of about $38 million.