Mayor Pugh seeks broad ethics exemption to raise private money to fund Baltimore programs

Baltimore Mayor Catherine E. Pugh is seeking a sweeping exemption from city ethics rules to allow her to personally raise private money to fund various community programs and events through City Hall’s charitable arm.

It’s a tactic Pugh has turned to frequently throughout her tenure, including the time she helped find funds to bus hundreds of young anti-gun protesters to Washington in March.

But it’s a strategy that ethics observers say can prove problematic and several cautioned Pugh against seeking the exemption.

Julian Lapides, a former state senator who served for 13 years on the Maryland ethics commission, encouraged Pugh to reconsider the idea — especially given “all the questions that seem to be occurring around city government these days.”

“It’s very much in her best interest to get prior approval,” Lapides said. “It would protect her from possible criticism if she gets prior approval. I wouldn’t want the mayor to get sandbagged by an unscrupulous corporation or group.”

Currently, the mayor and other government officials must obtain approvals from the Board of Ethics and the city’s spending board before they can solicit private funds. The rules exist to avoid potential conflicts of interest and the appearance of conflicts.

But City Solicitor Andre Davis has asked the ethics board to considering granting a waiver to the Democratic mayor so she does not have to make those requests each time she wants to encourage people and institutions to donate money to the government-controlled Baltimore City Foundation, which awards grants to fund various neighborhood programs and events.

“We want the mayor out there raising money in all kinds of ways,” Davis said. “We’re a poor city. Why would we put a constraint on the mayor’s ability to solicit assistance for the city?”

Davis said discussions with the ethics board are continuing and the five-member body has yet to make a decision.

Stephan Fogleman, a member of the ethics board, said he still has many questions about the mayor’s request and that the city needed to be especially careful about the way ethical questions are resolved.

“Since we’re one mayoral administration away from a mayor who was convicted of theft, I think the city could stand to be more forward in matters of transparency,” said Fogleman, referring to former Mayor Sheila Dixon’s previous theft conviction.

The four other ethics board members either could not be reached for comment or declined to talk.

Roger Hartley, the dean of the University of Baltimore's College of Public Affairs, said being able to raise private funds to supplement dwindling public resources “empowers a city to be a little more nimble in their dealings.”

But, Hartley added, “the big concern is transparency.”

“Is there still going to be transparency about who is donating and for what purpose?” he asked. “If you waive the notion that they don’t need to seek an opinion from the ethics board that could get the mayor entangled, maybe even unknowingly, in situations that would ethically compromise her and the city and the public.”

The city’s ethics rules are designed to ensure transparency around gifts and charitable support that officials receive from individuals and businesses that they may wield influence over in the course of their duties. In addition to seeking approval up front, officials are required to submit reports detailing fundraising activities.

Ethics experts say the concerns about government officials soliciting private money are twofold: The donors could seek special treatment from the government — in the form of a contract, for example — or the official could bully potential donors into giving money.

Pugh has spoken regularly about Baltimore needing private money to tackle problems from homelessness to violence. By relying on donations, Pugh has been able to stretch the city’s limited budget. But private-sector support makes it difficult for the public to know who is donating and how the money is being spent.

Private donors have provided money for a youth program called Roca, to purchase a mobile jobs van and to send students to the Washington gun control rally. In each case, the mayor’s office said she did not violate ethics rules because she didn’t solicit money.

At a meeting of the Greater Baltimore Committee last year, Pugh laid out her vision to the business group for bringing Roca, a renowned anti-violence program in Boston, to Baltimore. At the conclusion of the meeting, Pugh’s office said, three businesses and the Johns Hopkins University volunteered to donate the $6.5 million the city needed to get the program up and running.

But after Pugh said in March that private funds had been raised to cover the $100,000 cost of busing students to the rally, Davis said the mayor’s office started considering the idea of a broad waiver.

Davis said the details of how the waiver would be put into practice are still being worked out, but that the Baltimore City Foundation could report donations. Legally, though, the foundation is not required to disclose its donors and the mayor’s office has refused to say who contributed to fund the protest buses.

For the fiscal year that begins July 1, the city has planned to allocate $2.6 million to the Baltimore City Foundation to allow 1,200 young people to be served by youth programs, according to budget documents. During the current fiscal year, 924 young people have been served with foundation grants in 36 programs.

Davis said he hopes to convince the ethics board by highlighting how the mayor appears before various possible donors “day in and day out” to discuss the “desperate needs that the city has for support of any number of different programs.”

Not all fundraising for charitable causes or government programs is barred by the city’s ethics laws. Officials are only banned from soliciting money from people or businesses that might interact with the city in an official capacity, a group city law calls “controlled donors.”

Precisely who counts as such a donor varies by official. But Thaddeus Watulak, Baltimore’s deputy ethics director, said that in the case of the mayor it essentially includes anyone who does business with the city.

In March, the five-member Board of Estimates, which is controlled by Pugh, approved an ethics waiver for City Councilman Zeke Cohen. The councilman wanted to raise money for a summer jobs program and to help a scholarship fund for victims of violent crime.

Cohen said he decided that he should go through the formal ethics process because he wouldn’t know in advance if he would receive contributions from donors who might pose a conflict for him.

“Anytime you want to raise money for any nonprofit or basically anything, the correct way to do it is you have to go through the Board of Estimates and the Board of Ethics and get approval on both,” he said.

“If I’m making a blanket request for donations I feel it’s more prudent to go through the right process,” Cohen said. “I just try to be really careful about this stuff.”

Baltimore Sun reporter Doug Donovan contributed to this article.

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