Baltimore’s spending panel is set to vote this week on ending a longstanding agreement with a city contractor whose CEO was accused of improperly funding former Mayor Catherine Pugh’s campaign, payments that came under scrutiny during the federal investigation into the “Healthy Holly” scandal.
The Board of Estimates is scheduled Wednesday to consider revoking contracts with Grant Capital Management. The company has an agreement with the city, called a “master lease,” to help it pay for large contracts.
Company founder and CEO J.P. Grant could not be reached for comment Monday, when the board’s agenda was posted.
“The Department of Finance believes it is in the best interest of the City” to rescind the agreement, the agenda states.
Federal prosecutors said Grant wrote Pugh, a Democrat, checks totaling $170,000 despite knowing that she was illegally funneling the funds into her political campaign and toward buying a larger house. This included a $100,000 check to Healthy Holly LLC, with “book donation” in the memo line, referring to Pugh’s self-published children’s books.
Grant has not been charged with a crime.
The master lease with the city dates to 2003. The Board of Estimates renewed it in 2018, under Pugh’s leadership.
The city’s inspector general’s office concluded in a September report that the company should not have been considered for the renewal.
The company failed to comply with the terms of the city’s solicitation, submitting a false affidavit along with its bid, the report by Inspector General Isabel Mercedes Cumming found. Cumming also concluded the payments appeared to have been made in an attempt "to buy political influence and/or in direct exchange for political influence.”
In response to the inspector general report, City Solicitor Dana Moore said she would recommend that Grant Capital Management’s contract be revoked.
The master lease agreement allows the city to tap the company to provide money upfront for capital projects. The city repays the company with interest. As of December, the city had financed about $135 million in purchases through the arrangement, officials have said.
Pugh is serving a three-year federal sentence after pleading guilty to fraud and tax evasion charges.