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Having been rebuffed in their efforts to get Gov. Lawrence J. Hogan’s former chief of staff to testify voluntarily about a controversial severance payment, Maryland lawmakers have issued a subpoena to compel Roy McGrath to appear before them.
They also have subpoenaed Matthew Sherring, who served as director of operations at the Maryland Environmental Service when McGrath led the quasi-governmental agency.
The subpoenas are the first the General Assembly has issued in 15 years.
Faced with the need to find an outside lawyer to handle their investigation into the large severance payout McGrath received when he left MES to join the Hogan administration, lawmakers hired Ward B. Coe, a veteran Baltimore attorney who handled the last batch of subpoenas the legislature issued, part of an inquiry during Robert L. Ehrlich Jr.’s tenure as governor.
Hogan and Ehrlich are the only two Republicans to win the State House in the last 50 years.
“Marylanders need to be ensured that government employees are not treating the state as their personal slush funds, and I have faith that Mr. Coe, together with the members of the Joint Committee [on Fair Practices and State Personnel Oversight] will be able to determine the extent of this investigation,” said Senate President Bill Ferguson (D) in a statement.
The subpoena seeks McGrath’s testimony at a committee meeting that’s been scheduled for Oct. 29. The session will be the third meeting the panel has held since news broke that McGrath was paid a year’s salary from his former employer after he agreed to become Hogan’s chief of staff.
Members of the MES board have told the legislature that McGrath assured them that Hogan was aware of and “anticipated” the payment. Hogan has said he was unaware of the particulars, only that McGrath had some cleanup work to do regarding money.
Lawmakers believe one of the men is telling the truth but not both.
In addition to the severance, which was paid as the state was sliding into an economic slowdown triggered by the COVID-19 pandemic, McGrath was also reimbursed for months worth of expenses, executive training and global travel. Ice cream cones, popcorn, and at least one Annapolis lunch with a longtime Hogan aide were also covered by MES, records show.
MES is a 50-year-old state agency that provides environmental and infrastructure services to public and private entities, mostly local governments.. Nearly all of their revenue — 95%, board members have said — comes from municipal and county governments.
The subpoenas to McGrath and Sherring also seek a voluminous cache of records, among them:
- All documents and communications related to the nearly $234,000 severance payment McGrath received when he left MES in May.
- Communications he had with Hogan and any member of his staff concerning McGrath‘s departure from MES and his transition to his new position as chief of staff.
- All communications McGrath had with Hogan or any current or former member of his staff relating to Sherring’s salary or expense reimbursements.
- Emails and documents from MES board members regarding the compensation or expense reimbursements the two men received.
The committees are also seeking records relating to the MES severance policy and whether payouts were made to former directors
And they want emails or other documents that shed light on allegations MES hired a PR firm to handle the severance matter and the role McGrath may have played in shaping an MES press release even after he had left the agency.
The legislature is seeking to determine whether Beth Wojton, McGrath’s deputy at MES, was intentionally kept in the dark, by McGrath and Sherring, regarding expenses for the annual Maryland Environmental Business Leadership Conference, as she alleged during her testimony before the panel in September.
Attempts to reach McGrath’s attorney, Bruce Marcus, were unsuccessful on Thursday afternoon. Sherring did not reply to a request for comment, nor did Hogan’s office.
A partner at Gallagher Evelius & Jones, Coe will serve as lead independent counsel for the General Assembly in its investigation into personnel practices at Maryland Environmental Service.
In addition to serving as counsel to the General Assembly’s Joint Special Committee on State Employee Rights & Protections during the Ehrlich era, he served as deputy investigator of the Savings & Loan Crisis. He also currently serves as the chair of the Maryland Access to Justice Commission.
Coe has “conducted numerous internal investigations of publicly and privately held companies involving potential financial fraud, restatements and personnel matters,” according to a statement issued by Ferguson and House Speaker Adrienne A. Jones (D-Baltimore County).
“Having worked with Ward in this capacity before, I am confident in his ability to lead a thorough investigation and leave no stone unturned,” said Jones. “We have a responsibility to the taxpayers of this State to ensure that we know the facts, and recoup any inappropriate payments.”
Added Ferguson: “Mr. Coe has the unique background and experience to lead this inquiry. He understands the need to get to the facts of this situation, without allowing politics to dictate the way this investigation goes.”
In a statement, Coe said, “I am honored for the opportunity to work once again with the Maryland General Assembly.
“I appreciate the faith and opportunity from President Ferguson and Speaker Jones, and am confident our team will discover the facts of this inquiry,” he added.
“The more the Joint Committee has looked into this matter, the more questions have emerged, and we will make sure all Marylanders have confidence in this investigation being handled in a fair, and nonpartisan manner that seeks results.”