The top-earning lobbyist in Annapolis represents a company that was awarded a lucrative Maryland marijuana-growing license after a state commission pulled it from the ranks of losers and gave it a winning slot.
As a result of the controversial switch, lobbyist Gerard E. Evans' son-in-law stands to make a lot of money.
State records show that Evans represents Holistic Industries LLC, which counts Evans' son-in-law Richard Polansky among its equity investors. Polansky is married to Evans' daughter and lobbying partner, Hayley Evans.
Holistic originally was ranked too low to receive one of 15 state growing licenses. But members of the state's Medical Cannabis Commission reconsidered an earlier vote and removed two companies from the winners' list on the grounds that it lacked "geographical diversity."
As a result, Holistic and another company were moved up into the top 15 that qualified for licenses. The two downgraded companies have since sued the state.
The commission has stressed that it used a "double-blind" process in which evaluators didn't know the identities of any of the applicants. Members decided to reverse their earlier decision without outside influence, commission spokeswoman Vanessa Lyon said.
But the watchdog group Common Cause is concerned about the appearance, especially because Hayley Evans, also a registered lobbyist for Holistic, could benefit from her husband's good fortune as a result of a government decision. Holistic also won a state license to process medical cannabis.
Maryland's ethics and disclosure laws prohibit lobbyists from getting paychecks contingent on their success. The head of the State Ethics Commission said the law does not require a lobbyist to disclose a spouse's stake in a business the lobbyist represents.
"The letter of the law may be limited to a very narrow definition of lobbyists' pay, but this is an example of a personal benefit that will accrue only if the lobbyist is successful," said Jennifer Bevan-Dangel, the group's executive director.
Gerard Evans told The Baltimore Sun that he has no financial stake in Holistic and had nothing to do with Polansky's investment.
"It was a great opportunity for him and he took it. He's a businessman on his own," Evans said.
Evans said he aided Holistic by monitoring legislation and helping to prepare the company's application. He said he did not lobby any of the commissioners or their staff. Hayley Evans registered as a Holistic lobbyist out of "an abundance of caution," her father said. He added that she ended up playing no role in the company's bid.
Polansky is a lawyer and owns an auto parts and scrap metal company in Cecil County. He could not be reached for comment. Hayley Evans did not respond to several requests for comments.
Lyon said lobbyists have no role in the ranking or approval process for applications. The commission hired the Regional Economic Studies Institute to review and rank the 146 applications to grow, 124 applications to process and 811 applications to dispense the drug. The process was done in a "double-blind" manner that redacted identifying information about the applicants.
Dr. Paul Davies, the commission chairman, issued a statement when asked whether any applicants or representatives of applicants had contacted any commissioners to advocate for inclusion in the winning list.
"It would be unacceptable for any commissioner to have ex parte discussions with anyone associated with a potential licensee, particularly discussions that could provide unfair guidance or an advantage. Safeguarding the objectivity of the Commission's application process is always a priority," Davies said.
Commissioners also signed a sworn affidavit, under penalty of perjury, that they would not discuss any material within the applications during their review.
Applicants chosen by the commission must prove they have the money and adequate facilities to carry out their plans before their preliminary licenses are made final.
Analysts say Maryland's medical marijuana market is particularly attractive to investors because of the limited number of licenses and the broad base of potential clients. Just 15 companies will be allowed to grow the drug, but it can be recommended by doctors, dentists, podiatrists and nurse practitioners for a broad range of ailments.
California-based research company ArcView Market Research estimates the legal cannabis market nationwide will reach $22 billion by 2020, which would exceed how much the National Football League expects to take in that year.
The lawsuit filed by a company that failed to secure a license, GTI Maryland, alleges the licenses are "by all accounts valued at tens of millions of dollars."
Holistic had initially been rated 20th among bidders by the Regional Economic Studies Institute — well out of the running for the 15 slots. On July 27, the growers subcommittee unanimously approved the 15 prospective growers ranked highest by RESI after a process in which the evaluators were not told the identities of the investors or their investors.
But two days later, at the bidding of the subcommittee's chairman, the panel took a new vote that took licenses away from the No. 8 and No. 12 bidders and gave them to Holistic and the bidder ranked No. 21.
The subcommittee chairman, Cheverly Police Chief Harry "Buddy" Robshaw, explained that the group reshuffled the order of bidders to achieve more "geographic diversity." He said the original top 15 did not include representation from Southern Maryland or the Lower Easten Shore.
Holistic, which plans to grow in Prince George's County, was promoted to the No. 14 slot to represent Southern Maryland. No. 21 Shore Natural, which plans to grow in Worcester County, moved up to No. 15 to represent the Lower Shore.
Reports filed with the State Ethics Commision show Gerard Evans billed Holistic $90,000 for his work from November 2015 through Apri 2016, while Hayley Evans reported no earnings from the company.
Most applicants for marijuana growing licenses did not report hiring a lobbyist.
Gerard Evans perennially tops the list of the top-earning lobbyists in Maryland. The former member of Senate President Thomas V. Mike Miller's staff reported billing his clients nearly $2 million during the six-month reporting period, which includes the General Assembly session.
Gerard Evans' success comes despite a 2000 federal conviction for mail and wire fraud as a result of a scheme under which he arranged for introduction of bills that threatened his clients' interest so that he could bill them for more services. He was sentenced to 21/2 years in prison.
Baltimore Sun reporter Erin Cox contributed to this article.