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State lawmakers subpoena 2 more in Maryland Environmental Service investigation

State lawmakers will subpoena two more Maryland Environmental Service employees in their ongoing investigation into spending at the independent agency.

The investigation was prompted by The Baltimore Sun’s reporting that Roy McGrath, the service’s former executive director, received a six-figure payout last summer when he left voluntarily to become Gov. Larry Hogan’s chief of staff. McGrath resigned as Hogan’s top aide four days after The Sun’s report.

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The General Assembly’s Legislative Policy Committee voted Monday to issue subpoenas to require Michael Harris, the former MES finance director, and Dan Faoro, the communications director, to testify by March 18.

“These two individuals are pretty critical to the issues that we are investigating, including questionable reimbursements, procurement practices and communications with the legislature and with the executive branch,” said Del. Erek Barron, a Prince George’s County Democrat who co-chairs an oversight committee investigating the environmental service.

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Harris left the agency after McGrath’s payout became public. He could not be reached Tuesday for comment.

Faoro joined the environmental service in early 2020. He declined to comment Tuesday.

From late 2016 through mid-2020, McGrath oversaw the environmental service, which performs environmental and public work projects, such as operating landfills and dredging waterways, largely for local and state government agencies. Ninety-five percent of its revenue comes from other government agencies.

McGrath adopted the title “CEO and chairman,” traveled extensively in the U.S. and overseas, racked up significant expenses and negotiated the exit payment of more than $238,000. It represented a year’s salary and $5,250 toward tuition, according to documents and public testimony. He described the payout as “severance,” even though he left his position voluntarily to work for the Republican governor.

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Initially, McGrath defended many of his practices as routine at an agency that he said operates much like a private business. When he testified before lawmakers in December in response to a subpoena, he invoked his Fifth Amendment right against self-incrimination more than 170 times over four hours.

A former deputy director of MES and three board members have said they felt pressured to approve the payout because McGrath indicated Hogan approved of it.

Hogan has said he was not involved and only was generally aware that McGrath was working out financial issues with MES before joining his team.

One of McGrath’s subordinates at MES, Matthew Sherring, also testified before the legislative committee after being subpoenaed. Like McGrath, he invoked his Fifth Amendment rights more often than he answered questions.

Since the payout and financial practices have come to light, several top employees have left MES and the board of directors adopted rules limiting overseas travel.

Hogan ordered a review of independent agencies such as MES, and lawmakers are weighing a bill that would make significant changes to MES, including reconstituting the board and banning severance payouts.

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