Hogan criticizes Baltimore schools, would consider financial control board

Gov. Hogan criticized Baltimore schools for their money management amid a $130 million shortfall.

Gov. Larry Hogan criticized the Baltimore school system for its money management Thursday and suggested that additional financial oversight might be part of any deal to send more state aid to the city.

Speaking with a hoarse voice at a wide-ranging news conference in Annapolis, Hogan said he recently had a "good meeting" with Mayor Catherine Pugh and expected to sit down with her again to discuss the school system's $130 million budget shortfall.

However, the governor expressed dissatisfaction with the Baltimore school board — which he helps appoint — saying it kept "spending as if they thought they were going to get more money."

In response to a question, Hogan said creating a financial control board could be on the table.

"It will be part of the conversation," Hogan said. "So far we have had very preliminary discussions."

While the governor did not elaborate, a financial control board is generally understood to be a panel that oversees a government authority, such as a school board, and has veto power over its financial decisions.

Congress imposed such a board on the troubled District of Columbia government in 1995 as part of the price for a financial bailout. The board kept watch over the District's finances for six years. Two decades earlier, a similar board was created as part of a rescue plan for New York City.

Baltimore officials have pressed the Republican governor and members of the General Assembly to help close the schools' budget gap, which officials say could lead to more than 1,000 layoffs and larger class sizes.

Hogan expressed a willingness to work with the city but gave no indication that a resolution was near. "It's certainly not going to be a blank checkbook," he said.

The governor's comments came as Pugh and Baltimore schools CEO Sonja Santelises prepared to meet with city legislators in Annapolis on Friday morning. Del. Curt Anderson, a Democrat who chairs the city House delegation, said the officials are expected to lay out their plan to solve the school system's shortfall and explain what they hope the state will do to help.

Pugh wouldn't reveal details of what she plans to discuss, but said it would concern funding for city schools.

"We will provide assistance to the school system," the Democratic mayor said.

She said the governor's comments likely stem from their shared belief that there needs to be strict "fiduciary responsibility" of school system spending. The mayor said she believes the system needs to re-examine its structural costs, including funding for a large network of public charter schools.

During a school board meeting last week, Santelises — who has headed the school system since July 1 —dismissed any suggestion the district has mismanaged its money.

"Regardless of whatever narratives the community hears, this is not an issue of mismanagement. This is not an issue of lost money," she said.

Anderson said the system's financial woes were the result of events beyond its control. He rejected the notion of a control board.

"I don't think we're interested in reimposing any state controls over a local jurisdiction," he said.

Besides city schools, the governor covered a wide range of topics during a news conference called to announce that the state had received a $200 million federal grant to modernize the information technology systems it uses to deliver social services.

Hogan dealt with questions on repeal of the Affordable Care Act, government corruption and the state budget. The governor distanced himself from the health care plan offered by some congressional Republicans — and backed by Republican President Donald J. Trump — to repeal and replace Obamacare.

"It's not the GOP plan. It's a suggested plan by the House," said Hogan, who is under pressure from General Assembly Democrats to take a forceful stand in favor of the current law. Hogan called for a "bipartisan solution" and said the nation's governors, who met in Washington last weekend, were coming up with a plan that would "make more sense."

Hogan also teed off on the General Assembly following a series of alleged and admitted ethical lapses by sitting, past or prospective legislators.

They included the indictment this week of former Del. Michael L. Vaughn, a Prince George's County Democrat who was charged in a federal bribery investigation surrounding that county's liquor board. Former Del. William Campos, another Prince George's Democrat, pleaded guilty in January to bribery and conspiracy in the same case.

Hogan said the investigation could reach other lawmakers and Prince George's County officials, but did not provide specifics.

"I believe there's the potential for more indictments," Hogan said.

The governor also complained about the legislature's handling of legislation he has proposed to change the way the legislative and executive branch deal with ethical issues. The bills remain in committee, with uncertain prospects.

"How many people have to be indicted or accused of serious crimes?" Hogan said. "We think it's very important to clean up this mess in Annapolis."

Hogan used the lackluster revenue estimates released Thursday — which projected the state would get $33 million less revenue over two budget years than previously expected — as an occasion to renew his call for spending restraint.

"We just can't keep spending more than we take in," Hogan said. He criticized lawmakers for considering bills calling for mandated appropriations in future budgets, charging that they cumulatively called for a "ludicrous" $2 billion in spending increases.

The governor's comments came after he announced the launch of what his administration has named the MD THINK project, described as a "ground-breaking" technology platform to deliver human services.

Hogan said his current budget provided $14 million in seed money that helped attract the federal grant for the program, which he called "the first of its kind in the nation."

"This system will have a transformational effect on how our state does business," the governor said. He said it would integrate access to programs run by such departments as Human Resources, Health and Mental Hygiene, Juvenile Services, and Labor, Licensing and Regulation.

The system is expected to be used to provide services to such clients as children in foster care and families in need.

Hogan was joined at the announcement by several high-level administration officials, including chief of staff Sam Malhotra, described by the governor as "the visionary" behind the program.

Malhotra said the technology will allow the state to provide social services case workers with tablet devices they can use to provide services while in the field instead of having to wait until they are back in the office.

"To do that in real time is remarkable," Malhotra said. He described MD THINK as "nothing more than a large data repository in the Cloud" — keeping information stored on shared computer networks that minimize the need to own physical servers.

Baltimore Sun reporters Luke Broadwater and Tim Prudente contributed to this article.

mdresser@baltsun.com

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