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Ruppersberger faces MBNA balancing act Maintaining distance between personal interest, public policy

THE BALTIMORE SUN

The proposed move to Maryland of MBNA Corp.'s regional headquarters, hailed as a major economic boost to the Baltimore area economy, may put Baltimore County Executive C. A. Dutch Ruppersberger in the delicate position of balancing his public duty and his private business interests.

Rupp and Associates Inc., a debt collection company owned by Ruppersberger, does business with Delaware-based MBNA, according to Ruppersberger. The county executive also has had a friendship of about 20 years with Charles M. Cawley, MBNA's president.

Throughout the region, business leaders and government officials have applauded Ruppersberger's efforts in persuading MBNA to relocate here. His persuasive lobbying, based on years of working with Cawley and others in MBNA, they say, is precisely what county executives should be doing in stimulating economic development and growth in their home counties. The 2,500 professional, white-collar jobs and the presence of the $39 billion credit card giant would be the largest private-sector relocation in the Baltimore area over the past 25 years.

However, assuming that MBNA decides to relocate in Baltimore County, ethics experts -- both in Maryland and elsewhere -- say that it is very important that Ruppersberger distance himself from the many routine government decisions that will have to be made as MBNA plans and implements its move. The reason for this, they say, is to avoid any appearance that his business relationship with MBNA could affect how the company is treated in Baltimore County.

Speaking generally about cases in which a government executive has both a business interest and public responsibilities, Ed Seladones, former executive director of the Pennsylvania State Ethics Commission, said there are two sides: "The super Mr. Clean side is, 'If it might benefit me financially, then I probably shouldn't get involved.'

"The other side of it is, 'If it's going to be a great benefit to the county and the people I represent, shouldn't I be doing something that would help the people I represent?' "

Other independent authorities said that it is important for Ruppersberger to distance himself from the decisions on issues like building permits, zoning and environmental regulations as they pertain to MBNA. There would be a conflict "if he's in the process of receiving benefits while at the same time making policy decisions," said William I. Weston, former senior fellow at the University of Baltimore's Hoffberger Center for Professional Ethics. Weston is now the associate dean at Florida Coastal School of Law.

In interviews, Ruppersberger and his aides said that MBNA had been treated like other companies considering a move to Baltimore County. Michael H. Davis, Ruppersberger's spokesman, says that there is no conflict in this case and that when it comes to making decisions, "It wouldn't usually come down to a decision where Dutch says, 'Do this. Do that.' " County department heads -- not Ruppersberger -- will be signing off on MBNA's development proposals, he said.

Davis said that all sizable corporations being recruited for relocation in the county are treated well and that "politics" are not "involved with the development process in Baltimore County."

The county's ethics code does not prohibit the county executive and other public officials from having outside business interests such as real estate, securities or an ownership in privately held companies. The code also says that a county official "may not participate in any matter" involving "any business entity in which he has a direct financial interest."

MBNA spokesman Peter Frank said there is no connection between the move and Ruppersberger's business. MBNA, he said, is not getting any "economic benefit in terms of abatements or credits. What we're really concentrating on is bringing jobs to Baltimore. Beyond that, it's just not relevant."

Ruppersberger's relationship with MBNA and its executives dates to the 1970s when Ruppersberger, then a private attorney, began handling legal work for MBNA, which was based in Baltimore.

Rupp and Associates was established Dec. 1, 1994, shortly after Ruppersberger was elected county executive. Ruppersberger said he closed his law practice after winning the election but retained the debt collection business.

"I wasn't going to build my business since 1972 and throw it away," Ruppersberger said. "I gave up my entire law practice but kept that one facet and incorporated that," he said.

One of the main reasons for keeping the business, Ruppersberger said, was to make certain that he could be financially independent while serving as a public official. "I don't want anyone to own me," said Ruppersberger. "I want to maintain other sources of revenue, so I don't need this job."

Ruppersberger owns all 1,000 shares of Rupp and Associates stock, his financial disclosure statement shows. The statement says the value of the company is "undetermined" for 1995 and 1996.

Ruppersberger is not a salaried employee of Rupp and Associates, but he does earn income from Rupp; he says his brother is president of the company. He declined to disclose the amount of Rupp's revenue from MBNA.

According to Ruppersberger's public disclosure forms, he also has an interest in two other companies:

International Marketing Network Inc., in which Ruppersberger is listed owning all 58,000 shares. He lists the value as "Undetermined. Minimal value at this time."

Antaeus Group Inc., in which Ruppersberger bought 1,500 shares Dec. 22, 1995, according to the forms. The company, now in Hunt Valley, was formed in 1989 as "a marketing company for infectious waste equipment."

Local executives and Ruppersberger say the location of a credit card company would have little bearing on revenue of collection agencies. "The physical location of the company itself has no bearing on where the collection work goes," said Dino Marroney, owner of ICS Financial Services in Harford County. "We do a lot of work for companies in California, Texas and Florida. No one is knocking on doors anymore. They're going to make a phone call."

MBNA intends to establish its mid-Atlantic regional headquarters by the end of the decade. It is scouting 16 possible sites, and has been working in recent weeks with Baltimore County's Department of Economic Development on possible locations. Ruppersberger and business and political leaders believe the company is likely to choose Baltimore County -- and possibly Towson, the former home of MBNA's Cawley.

Pub Date: 2/04/97

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