Maryland’s troubled state agency for foster children inked more than a billion dollars’ worth of contracts Wednesday with private providers to expand capacity in hopes of reducing reliance on controversial hospital or hotel stays.

The contracts will provide care for hundreds of children and are “an important step forward,” said Gloria Brown Burnett, the interim secretary of the state Department of Human Services.

For years, the department has put some children in hospitals and hotels rather than in foster homes or appropriate treatment centers. The problem burst into public view last fall, when 16-year-old Kanaiyah Ward died by suicide in a Baltimore hotel where she was supposed to receive one-on-one supervision.

After Ward’s death, the Department of Human Services issued a policy prohibiting housing foster children in hotels — though the policy has been violated at least once.

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There are currently 3,768 children in foster care in Maryland, including eight who are staying in hospitals, according to the state.

One challenge in caring for children with complex needs is the state’s lack of appropriate placement options, Brown Burnett said at a state Board of Public Works meeting.

The board signed off on a massive set of contracts for nearly three dozen providers to care for 637 children, up from 600.

Over three years, the contracts will cost nearly $744 million. A two-year renewal option worth $496 million could bring the total five-year cost to $1.24 billion.

Comptroller Brooke Lierman, a Democrat and member of the public works board, pressed Brown Burnett on whether the state would end “hoteling” of children and hospital overstays.

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While Brown Burnett said the state had “absolutely” ended the use of hotels, she could not say when they would stop keeping children in hospitals when not medically necessary.

“It would be irresponsible to stand here and give you a date ... The hospital overstays obviously are a byproduct of not having enough resources in the state and, as a last resort, out of state,“ Brown Burnett said. The contracts move the state closer to ending hospital stays, she said.

The Department of Human Services is also setting statewide standards for providers delivering one-on-one care for children with complex needs.

State lawmakers, meanwhile, are considering legislation named for Ward that would ban the state from placing foster children in unlicensed settings, require background checks for all adults in a home where a child is placed and create a child welfare ombudsman’s office.

Brown Burnett said her team is working closely with lawmakers.

“We’ll be in alignment with whatever is passed,” she said.