Two months before Election Day, a high profile Democratic state senator gets indicted, and Bob Ehrlich strangely sits on his hands, just like he did last January when Baltimore’s Democratic mayor, Sheila Dixon, took a plea and resigned.
This is a striking contrast with his first gubernatorial race, when Mr. Ehrlich campaigned hard against what he called, "a culture of corruption," never mentioning that the principal culprits were two lobbyist friends of his. This year Mr. Ehrlich is too busy blaming Gov. O’Malley for the global recession caused by eight years of Republicans gone wild to talk about corruption, or for that matter, his record of raising taxes by $3 billion and proposing the largest annual spending increase in Maryland history.
But the real reason Bob Ehrlich will not dare to mention corruption this year is that he knows doing so will invite exposure of his own record, revealing that...
Bob Ehrlich was Maryland’s most corrupt governor since Spiro Agnew.
If that’s news to you, it’s because it’s not news. See, information, no matter how factual and interesting, isn’t news until there’s a hook, and news outlets only report information when it becomes news.
Some of this was reported when it happened, and I rehash it regularly here and on twitter, but Bob Ehrlich has thus far dodged exposure of his graft infested record since he announced his candidacy earlier this year. With 60 days until the election, however, it’s time for Maryland voters to take a fresh look at Bob Ehrlich’s sordid gubernatorial term.......
Influence Peddling – David Hamilton
When Mr. Ehrlich was governor, his longtime friend, Baltimore lawyer David Hamilton, unashamedly sold access to the governor, otherwise known as lobbying, while skirting lobbyist registration requirements so he could continue to shake down Maryland businesses for Mr. Ehrlich’s campaign. Mr. Hamilton made no apologies for selling access to his friend, then-Gov. Ehrlich, and delivering millions of dollars in state business to his clients....
"We didn’t have a government relations practice before he was elected," Mr. Hamilton told Matthew Mosk at the Washington Post, "but clients started coming to us and saying, ‘Can you help us?’ And it’s worked out pretty well."
Today Mr. Hamilton is the managing partner of Mr. Ehrlich’s lobbying law firm, Womble Carlyle-Baltimore, which is why Mr. Ehrlich owes Maryland voters a frank explanation of his own work for Womble over the past four years, and what boundaries he contemplates, in the unlikely event that he is elected, between the governor and his former law firm specializing in "government affairs" that paid him $2.5 million over the past three and a half years.
Bid Rigging – Alan Fabian
In 2007, on the day that Republican mega-donor and discredited Baltimore philanthropist Alan Fabian was indicted in a $32 million computer leasing scheme, former Ehrlich administration aide-cum-Womble Carlyle Baltimore lawyer J.P. Scholtes quietly filed a motion to seal monthly financial reports for CMAT International, the for-profit arm of a charitable organization that Mr. Fabian used in his fraud. Among other irregularities, Mr. Fabian collected an $850,000 salary from this supposed charity while selling phony accounts receivable to a factoring firm.
CMAT was one of the clients David Hamilton acquired during Mr. Ehrlich’s gubernatorial term that secured millions of dollars in state contracts from the Ehrlich administration. He and Mr. Ehrlich brought CMAT and other Fabian firms to Womble’s new Maryland offices when they opened with six former Ehrlich staffers in 2007. The motion to seal served CMAT’s interest, but it also shielded Mr. Ehrlich from embarrassment over a $55,000 fee from his felonious client with whom he had a political relationship when Mr. Ehrlich was governor.
In May 2006, the Ehrlich administration tripled a state computer contract awarded to Mr. Fabian’s CMAT from $700,000 to $2.2 million without competitive bidding. It was a peculiar action because Mr. Fabian had won the contract only 11 months earlier, in June 2005, by under-bidding three competitors that state evaluators determined to be better qualified to do the work. Five other competitors were eliminated because state evaluators determined they were not qualified to do the work, and a sixth withdrew.
Two of the qualified competitors pinned the cost of the job at just under $1 million and the third bid just over $1 million, but Alan Fabian’s company won the contract even though he was the least qualified because he offered to do the work for almost half that price, $589,000. Then, only eleven months later, without competitive bidding, the Ehrlich-Steele administration tripled Mr. Fabian’s contract to $2.2 million, which was double the price offered by the more qualified competitors he edged out the year before.
What Mr. Fabian lacked in qualifications he made up for in campaign contributions.
Federal and state disclosures show that Mr. Fabian was one of the Ehrlich-Steele administration’s top contributors, donating $285,000 to campaign committees benefiting the pair over their 4-year tenure in his own name, his wife’s name, and through various businesses he controlled. He bundled at least $100,000 more from employees and associates. Although a steady contributor, Mr. Fabian embarked on an unmatched giving frenzy in the weeks before and after the Ehrlich-Steele administration tripled his state contract, contributing $95,000 of his own money and bundling an additional $50,000 in contributions from friends and associates. He held a high profile fundraiser at his Cockeysville home for Mr. Steele on June 23, 2006, featuring a surprise guest, Karl Rove. The invitations were likely sent within days of the Board of Public Works action to triple Fabian’s state contract.
Flying Air Fabian
At the time, Mr. Fabian was also the finance chairman for Mr. Steele’s unsuccessful U.S. Senate campaign, which was critically important to Mr. Ehrlich’s dream to establish a political dynasty. Mr. Steele’s campaign disclosed 6 reimbursements to Mr. Fabian’s company for "travel," and the Republican Governors Association disclosed a $54,000 contribution from Mr. Fabian’s company labeled "In Kind Air Travel." Court records show that Mr. Fabian used some of the money from his lines of credit to pay for a private charter jet. A spreadsheet obtained through Maryland’s Public Information Act shows that Mr. Ehrlich and Mr. Steele made several trips to Republican events around the country by "Private Airplane" coinciding with the dates on the campaign disclosures.
Neither Mr. Steele nor Mr. Ehrlich listed any gifts of air travel on their personal financial disclosures during their tenure. While it may not have been illegal for Mr. Ehrlich or Mr. Steele to fly around the country in Mr. Fabian’s private charter jet while their administration was busy awarding him a contract under suspicious circumstances and then tripling it to $2.2 million without competitive bidding, it is certainly unethical and crying out for exposure.
Court documents include a letter to Mr. Hamilton from Mr. Fabian’s criminal lawyer in September 2006, revealing that while the Ehrlich administration was paying CMAT taxpayers’ money for "strategic budgeting services," Mr. Hamilton was aware of the federal probe that led to Mr. Fabian’s fraud indictment and guilty plea. A recent jailhouse appeal from Mr. Fabian included an email to Mr. Hamilton and Mr. Steele’s former campaign manager, Michael Leavitt, who is presently Mr. Steele’s chief of staff at the Republican National Committee, indicating that the federal probe may have been brought to Mr. Steele’s attention several weeks before the Ehrlich-Steele administration tripled Mr. Fabian’s state contract without competitive bidding.
Although this story has never been fully exposed beyond my blogging, Ehrlich spokesman Henry Fawell dismissed the parts that have been reported, claiming the contract was competitively bid and that nothing inappropriate was found in Mr. Fabian’s work for the state. That’s not even half-true; the contract was awarded under suspicious circumstances and after Mr. Fabian’s competitors were eliminated, it was tripled to $2.2 million, double the highest bid, without competitive bidding. The O’Malley administration, which has been recognized for innovation in quantitative tracking and management, politely commented that Mr. Fabian’s system was entry level off-the-shelf-software of no prospective value.
Embezzlement-Sandy Roberts
Last year, WBAL TV’s Jayne Miller reported that Bob Ehrlich and Michael Steele paid $417,000 of their donors’ money to a defunct commodities trading firm registered to Sandy Roberts, a friend of Mr. Steele who had never been in any kind of campaign services business. See the firm’s website as it appeared before and after Jayne Miller’s story broke and judge for yourself whether or not it is a legitimate enterprise.
The money was paid in 28 transactions in the final weeks of their 2006 campaign from four state and federal accounts Mr. Ehrlich and Mr. Steele controlled. Federal and state laws prohibit campaigns from concealing the true recipients of campaign funds by paying third party conduits, and of course campaigns can only use their donors’ money for legitimate campaign purposes.
If you think misuse of $417,000 that people donated to a campaign doesn’t matter, consider that Florida’s Republican party chairman was recently indicted for paying $120,000 of donors’ money from party coffers to a bogus company that allegedly didn’t do any work.
Mr. Ehrlich and Mr. Steele refused to answer Jayne Miller’s questions about the payments, and Mr. Ehrlich was not a candidate at the time, so the story died. Now that Mr. Ehrlich is running for re-election, and especially in light of the recent indictment, he and Mr. Steele need to fully explain why they paid $417,000 of their donors’ money to Allied Berton LLC, complete with invoices and receipts.
Cronyism-Sandy Roberts
The same Sandy Roberts secured a lucrative do-nothing concession at state-owned Baltimore Washington International Airport (BWI) during the Ehrlich administration. State auditors found that while Mr. Ehrlich and Mr. Steele were in office, their friend Mr. Roberts, who is black, posed as an independent airport retail business owner so that airport retail giant Hudson News could meet minority participation goals at Baltimore Washington International Airport.
Here’s what the Maryland Aviation Administration said about Olympic News, Mr. Roberts’s firm that claimed to independently operate six prime storefronts at BWI airport:
"This DBE firm was given an initial finding of noncompliance as it was determined to be operating in a manner that demonstrated that the DBE owner was not operating independently or managing and controlling its business ....
Although [Mr. Roberts] indicated that his company is operating independently and that he is in control of the company, the information and documentation provided during this review did not support that statement...."
What’s most troubling is Mr. Steele’s denial of any involvement, according to the Baltimore Sun:
Steele has said he was not involved in any airport deals, though he had worked to improve the prospects for minority businesses in the state.
and,
Hudson [News] said it recruited Roberts from a list of business people approved as disadvantaged businesses.
Does anyone believe Hudson News simply picked Mr. Roberts from a list and his selection had nothing to do with his ties to the then-governor and lieutenant governor of the state that owns the airport? Mr. Roberts reported no prior retail experience, and court records show Mr. Roberts’s small home-based on again/off again wholesale business accumulated a long list of judgments for failing to pay suppliers right up to the time he entered the relationship with Hudson News. His wife and business partner was under Chapter 13 bankruptcy protection (which was cured after their "lucrative" deal with Hudson News began to pay off).
Despite these deficiencies, the Ehrlich-Steele administration fast-tracked minority retail certification of Mr. Steele’s friend’s business so that he could enter the lucrative hands off partnership with Hudson News at the airport owned by the state they controlled. Hudson News could have partnered with many certified minority owned businesses with retail experience and without such baggage, but instead they claim they picked Mr. Steele’s friend "from a list."
We might believe Mr. Steele’s denial if Sandy Roberts was the only Ehrlich-Steele friend to gain state business during their tenure, but he was not:
Longtime GOP strategist Carol Hirschburg, pursuing a $110 million state computer contract, obtained fast-track minority certification during the Ehrlich-Steele administration that was later found to be improperly awarded and was withdrawn, as reported by the Baltimore Sun.
Joanne Vatz, the wife of Mr. Ehrlich’s close adviser, the commentator and Towson University Prof. Richard Vatz, started a computer business nine months after Mr. Ehrlich and Mr. Steele were sworn in, obtained minority certification, and landed several no-bid state contracts, as reported by the Baltimore City Paper. Although the timing of her decision to start a state contracting business—right after her husband’s friend Mr. Ehrlich got elected governor—is suspicious, Ms. Vatz’s company has been recognized for exceptional service during both the Ehrlich and O’Malley administrations.
Maryland GOP activist and Ehrlich-Steele campaign website designer Aaron Kazi similarly secured minority business certification soon after Mr. Ehrlich and Mr. Steele were inaugurated, leading to a number of state contracts and participation in the same $110 million deal with Ms. Hirschburg, according to the Baltimore Sun.
Alan Fabian has already been discussed.
Nepotism-Kendel Ehrlich
Mr. Ehrlich’s wife and business partner, Kendel Ehrlich, landed a job at Comcast after Mr. Ehrlich was assigned to a congressional committee regulating telecoms. During Mr. Ehrlich’s gubernatorial term, she returned to Comcast, drawing a $50,000 annual salary for playing the part of Maryland’s first lady on a series of half-hour PSAs that can best be described as never meant to be watched by anyone. Tellingly, the job disappeared as soon as her husband lost his re-election bid and was no longer of value to Comcast, and it was suspiciously omitted from her otherwise complete career history on the Ehrlichs’ campaign biography earlier this year.
When the Baltimore Sun and Washington Post questioned the propriety of Mrs. Ehrlich accepting a salary from a corporation dependent on Ehrlich administration decisions for doing very part-time work of poor quality, the Ehrlichs cried sexism. Well, Ms. Ehrlich had a distinguished career as a prosecutor and a public defender, and her skills as a career professional are well recognized. That didn’t stop Mr. & Mrs. Ehrlich from making a very poor ethical decision when she accepted the overpaid make-work position with Comcast while her husband’s administration held sway over Comcast’s tightly regulated industry.
Misuse of campaign funds-Bob Ehrlich
Bob Ehrlich isn’t bashful about exploiting loopholes and ethical shortcuts today (read; radio show and not-lobbying-lobbying) and he wasn’t in his last campaign when he used the Maryland Republican Party’s federal account to pay the salary of his state campaign spokeswoman, among other illegal payments, as John Fritze reported for the Baltimore Sun. Maryland law caps donors’ contributions at $4,000 to any single campaign and $10,000 total over a four-year election cycle. In 2006, Mr. Ehrlich’s maxed out donors began appearing as $10,000 donors to the Maryland Republican Party’s federal account, which they have a right to do, but Mr. Ehrlich did not have a right to bypass Maryland’s contribution caps by paying his state campaign expenses from his party’s federal account. He was rebuked by the State Board of Elections and required to reimburse the Maryland Republicans with untainted campaign money.
Dishonorable Mention-The Philadelphia Busing and Fake Ballot Ploy
In the most bizarre, dishonest, racially insulting and cruel political ploy in recent memory, on Election Day 2006, Mr. Ehrlich’s and Mr. Steele’s campaigns filled 6 buses with indigent men recruited from a Philadelphia program for ex-offenders on the promise of 3 square meals and $100 each, delivered them to Maryland where the governor’s wife and political partner, Kendel Ehrlich, gave them a pre-dawn pep talk and then sent into predominantly African American precincts to pose as campaign volunteers handing out flyers suggesting popular African American Democrats endorsed Mr. Steele and Mr. Ehrlich. Authority lines indicated both Mr. Steele and Mr. Ehrlich approved the flyers.
Of course the plan backfired, as many of the shanghaied men refused to hand out the flyers, the targeted voters were more bemused than angered at the stupidity of the ploy, and the prominent community leaders and elected officials referenced in the flyers denounced the whole affair.
In one singularly stupid act, Mr. Ehrlich, Mr. Steele, and their entire team shamelessly exploited indigent ex-convicts trying to put their lives back together, insulted their own constituents, and effectively stole endorsements from prominent Marylanders who opposed their election, at least one of whom warned them ahead of time not to use his name and likeness in this manner.
This act alone should disqualify Mr. Ehrlich and Mr. Steele from ever getting elected to anything again, because, after all, who in their right mind would vote for a politician capable of such stupidity.
- Steve Lebowitz, Annapolis
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