Maryland lawmakers were again frustrated with more questions than answers Wednesday, as the governor’s former chief of staff responded to a subpoena requiring him to testify but said little to shed light on a six-figure payout he received from his prior state job.
Members of a General Assembly oversight committee tried for months to get McGrath to answer their questions. While the subpoena compelled his appearance, he invoked his Fifth Amendment right against self-incrimination at least 170 times. In dozens of other responses, he said he couldn’t recall what legislators wanted to know.
Legislative leaders said it’s clear to them McGrath spent money lavishly and negotiated a significant payout despite transferring from one state position to another. They’ve reviewed hundreds of pages of documents and interviewed other witnesses, publicly and privately.
“We’ve had a lot of evidence about a large, unwarranted, unprecedented payout for a lateral move within state government,” said Del. Erek Barron, co-chair of the committee. “That evidence, I haven’t heard much, if any, opposition to.”
Barron, a Prince George’s County Democrat, also referenced “a lot of evidence about improper expenses or travel and not much, if any, explanation for those expenses.”
Sen. Clarence Lam, who co-chairs the Joint Committee on Fair Practices and State Personnel Oversight, said McGrath’s actions remain concerning.
“We have a duty to hold people accountable,” said Lam, who represents parts of Howard and Baltimore counties.
For the better part of four hours, Ward B. Coe, an attorney for the lawmakers, grilled McGrath via video. McGrath’s attorney, Bruce Marcus, appeared at his side.
Coe attempted to get McGrath to describe how he got the Maryland Environmental Service’s board of directors to approve the payout at the end of May, when he left to become Hogan’s chief of staff. It represented a year’s salary of $233,647, plus $5,250 in tuition reimbursement.
McGrath previously described the payment it as “severance,” even though he left voluntarily.
McGrath declined to answer questions about whether Hogan knew about or endorsed the payout.
A former deputy director and three members of the environmental service’s board have testified McGrath led them to believe Hogan supported the payment.
Hogan, meanwhile, has asserted that he didn’t approve the deal and only knew generally that McGrath was working out financial matters before moving to the State House.
“Somewhere in there is the truth and that’s what we’re trying to get at,” Lam said at the meeting.
McGrath also declined to answer Coe’s questions about his text messages to the governor, seeking help defending himself after the payment became public.
“On the advice of my counsel and pursuant to my legal rights, I respectfully decline to answer that question,” McGrath said repeatedly.
McGrath refused to say why he took so many trips and racked up significant expenses during his tenure leading the environmental service from December 2016 until May 31. Coe calculated the agency reimbursed McGrath more than $129,000 — far exceeding the expenses of other former MES directors.
More than $55,000 in expenses was paid to McGrath after he left the environmental service.
The expense reports document extensive U.S. and international travel. McGrath declined to explain why he took the trips and whether they resulted in new business for the environmental service.
He also would not explain why one of his employees, Matthew Sherring, accompanied him on many trips and shared many meals. Sherring testified last week and frequently cited his Fifth Amendment rights as he declined to answer questions.
The Maryland Environmental Service is an independent state agency that performs public works and environmental projects, such as operating landfills and dredging waterways, primarily for local and state government agencies. About 95% of its revenue comes from other government agencies.
It’s overseen by the board, which is appointed by the governor with confirmation by the state Senate. As an independent agency, it is not part of the state personnel and retirement systems and sets its own policies for pay and benefits.
McGrath didn’t follow those policies, according to an audit of his expenses the environmental service ordered this fall. Coe showed the audit’s conclusion during the hearing, which noted hundreds of violations, such as filing expenses past deadlines and exceeding allowed amounts. In several instances, McGrath approved his own expenses.
Coe’s questioning noted inconsistencies, such as McGrath and Sherring both putting in expenses for the same dinner during a conference. And he highlighted questionable hotel stays in Baltimore and Annapolis.
Coe also sought explanations for an online Harvard University leadership course that McGrath took in June. Sherring paid the $14,475 bill for the course and McGrath approved the expense, Coe noted, showing the relevant documents.
Coe showed where McGrath was listed as the approving manager. “That appears to be correct,” McGrath said.
When asked whether he engineered the report so he could approve it himself, McGrath declined to answer. McGrath also declined to say why the environmental service should pay for a course after McGrath moved to the governor’s team.
And while McGrath said he couldn’t recall whether he told anyone at the Maryland Environmental Service about the course, he said he did tell the governor.
“What I told Governor Hogan is that I had been scheduled to take this for five months and that timing happened to coincide with the transition to my new job,” McGrath said.
McGrath wouldn’t say, however, what he told Hogan or anyone else about who paid for the course.
The questioning of McGrath also ventured into the state’s problematic, multimillion purchase of coronavirus tests in April from Lab Genomics, a South Korean company. Hogan credited McGrath with “spearheading” the purchase during a news conference, in a press release and in his political memoir.
The state had to return the vast majority of the initial shipment of 500,000 tests and pay for replacements. All told, the state spent $11.5 million on the tests. Lawmakers questioned the tests for months and state auditors are reviewing the deals.
McGrath sought to downplay his involvement, saying he was more involved in the logistics of getting the tests to Maryland.
“I think Governor Hogan was very generous in his praise of me and the work that I did,” he said.
It’s not clear where the General Assembly committee goes next, having heard from key witnesses but without definitive answers to their questions.
Members have not indicated whether they would seek to have Hogan testify.
In a case like this where there are “serious allegations of misuse of an entire state agency,” Barron said that lawmakers have a responsibility “to take that as far as it goes.”
“Really, it’s about transparency and accountability and the truth,” Lam said.
Hogan, meanwhile, announced Wednesday the formation of a commission to review independent agencies, including the Maryland Environmental Service.
“We need to take a long and hard look at the way that our quasi-governmental agencies operate, and focus on making real and systemic reforms,” Hogan said in a statement.
Hogan tapped Andrew Serafini, a recently retired Republican state senator from Washington County, to chair the commission. The commission is required to submit a report by Dec. 1, 2021.
Hogan previously tasked his budget office with auditing the environmental service, a review that is ongoing.