Selection for ‘seamless’ transition lasts 11 weeks

Tracing McGrath’s path from MES to State House

Coronavirus cases were peaking. Hundreds of thousands of Marylanders were out of work and struggling to get state benefits from a balky online system. Then, a Minneapolis police officer killed George Floyd, reigniting the Black Lives Matter movement with widespread demonstrations.

If there ever is a good time to lose a chief of staff, for Maryland Gov. Larry Hogan, it wouldn’t have been this May.

Chief of Staff Matthew A. Clark, who dated back to Hogan’s first term, had been key in overseeing the many moving parts of the state’s pandemic response. But he had accepted a position at the University of Maryland Medical System in Baltimore, and his last day was May 29.

With so many pressing issues, there was no pause button for a leisurely search for a replacement. Hogan selected someone familiar and within reach, and who could start June 1: a former aide who had left to run a little-known branch of state government, but recently returned on loan to help Hogan’s team with the

Roy McGrath was the director of the Maryland Environmental Service before he replaced Matthew A. Clark as the governor’s chief of staff on June 1. He resigned Aug. 17.

public health crisis.

Today, Roy McGrath and that agency, Maryland Environmental Service, are decidedly less obscure. The Baltimore Sun reported Aug. 13 that McGrath had secured a more than $238,000 severance from his previous job, as well as assorted and questionable perks.

Four days later, he resigned, even as details continued to emerge and form a puzzling portrait: After spending much of his life in or adjacent to politics and governing and reaching the top administrative position in the State House, how did it slip from his grasp?

The developments that tumbled out into public view in the past two weeks also have raised questions about what the governor knew and when he knew it — and spurred an inquiry by state lawmakers.

From interviews and documents obtained to re-create McGrath’s path, it appears he viewed himself as transitioning from private enterprise and into public service. He successfully sought an exit package commonly granted to corporate executives before settling into his new governmental post.

But the Maryland Environmental Service gets 95% of its revenue from contracts with local governments and state agencies to carry out environmental and public works projects. The governor appoints the executive director and most of the members of the board of directors, subject to state Senate approval.

However, as an independent state agency, MES isn’t bound by the laws that govern employees of other state departments and has its own personnel and compensation system.

“It’s normal practice that every director that has ever left there has gotten a year’s severance,” Hogan said McGrath told him several days before the newspaper’s first report.

“‘It was, you know, it was what I was entitled to,’ ” Hogan quoted McGrath as saying. “‘It’s what they’ve always done.’ ”

But if that was routine in what Hogan called the “strange creature” that is MES, the agency’s generosity to McGrath ultimately did not fly on the second floor of the State House — the governor’s version of the White House’s West Wing.

Hogan appeared to accept McGrath’s explanation at first, but more issues about his tenure at MES arose. Hogan’s staff learned McGrath received bonuses and $55,000 in expense reimbursements on his way out the door.

“As soon as further concerning things came out, he resigned immediately ... Within 20 minutes, he decided to resign,” Hogan said.

It was a rapid-fire conclusion to a long professional relationship between McGrath, 51, and Hogan.

In 1992, while a student at the University of Maryland, College Park, McGrath worked on Hogan’s unsuccessful campaign to represent the 5th District in Congress.

A lifelong Marylander with roots in Charles County, McGrath spent 18 years at the National Association of Chain Drug Stores, a trade group based in Virginia.

McGrath, according to his official state biography, returned to Hogan’s orbit in 2014, working on the governor’s first statewide campaign and, after the surprise victory, joining the transition team.

McGrath became a senior adviser to the new governor, then a deputy chief of staff. Among his responsibilities was handling matters before the Board of Public Works, which approves state spending contracts.

At the end of 2016, Hogan sent McGrath to Millersville to run MES, though the governor has acknowledged he doesn’t pay much attention to the agency.

“I don’t know much about what goes on over there, but we hadn’t heard a single complaint ever in three years,” he said.

Hogan pulled McGrath back to the State House in March, to join an all-hands-ondeck response to the coronavirus. The governor has said he leaned on McGrath’s expertise in procurement to help buy masks, gowns and test kits. McGrath spoke at a State House news conference April 15, noting he was one of the state’s “public servants” with “transferable skills” that were tapped for the coronavirus response.

On April 20, as Hogan announced a previously secret undertaking to buy 500,000 test kits from South Korea, and fly them to Maryland, he thanked McGrath as the team member who “spearheaded our efforts.”

In an email to The Sun, McGrath estimated he worked 100 hours a week between his regular job running the environmental service and his role helping the governor’s team.

By May, Hogan had begun the delicate task of reopening previously shuttered businesses and venues. Each step along the way drew pushback, whether it was medical experts saying it was too soon or still-closed businesses agitating to be allowed to open their doors.

It wasn’t the ideal time to cast a wide net for a new chief of staff, or to be without one for an extended period.

On May 26, Hogan publicly announced Clark’s departure and McGrath’s appointment. He described McGrath in a statement as “an experienced public and private sector leader with a proven track record of managing at every level of government and a passionate commitment to public service.”

Hogan touted McGrath’s “key role” in the state’s coronavirus response and assured there would be a “seamless” transition as a result.

McGrath sent an email to Maryland Environmental Service board members that day, letting them know he’d be leaving.

“We have accomplished a great deal together in recent years,” McGrath wrote. “I proudly leave MES in its strongest financial position ever and with a solid leadership team and an able board to guide it forward.”

McGrath pivoted to securing a severance payout, according to documents and testimony provided to a General Assembly committee investigating the matter.

McGrath asked the board’s human resources committee for a payment equal to a year’s salary of about $233,000. He also asked for tuition reimbursement of $5,250 and to keep his work-issued cellphone and laptop.

Some board members have since said they had reservations about McGrath’s request. But they felt compelled to say yes, given McGrath’s relationship with the governor and assurances from him that Hogan knew what he was requesting.

“It’s pretty simple,” board member William B.C. Addison Jr. told lawmakers at an oversight hearing. “You’ve got somebody who is going to a position working for the governor that really is going to control a lot of what the state does. It’s a very powerful position that’s going to have an impact on MES.”

McGrath’s deputy director, Beth Wojton, told McGrath in a text message May 27 that board members didn’t want to approve the severance without the governor’s OK.

“They are worried about the optics and don’t want to do anything to make the Governor look bad,” Wojton wrote. “I told them that I thought that the governor was aware and was OK with it. Correct?” McGrath’s reply: “It’s anticipated.” Hogan has disavowed any involvement in the deal.

On May 28, the full board voted in a private video meeting to approve McGrath’s severance package.

On June 1, McGrath joined Hogan’s staff, although he was wrapping up business at MES. He submitted more than $55,000 worth of expense reimbursement requests on June 4, some of which dated to January 2019. The reimbursement covered several trips, including one to a water conference in Israel, scores of lunches and dinners, and two years of Costco memberships.

The requests were quickly approved, even though the MES finance director has since acknowledged McGrath violated a policy that requires expenses to be submitted within five days after they’re incurred.

It was in August that the governor’s counsel got wind of McGrath’s parting rewards and told the governor, according to a timeline laid out by Hogan. Several days later, The Sun published its first report on Aug. 13.

Publicly, Hogan remained quiet, and the governor’s office declined to make McGrath available for interviews. But McGrath mounted his own defense. On Aug. 14, he texted the new director of the Maryland Environmental Service, Charles Glass.

“Hi Charles. Can you talk?” McGrath wrote. “Time sensitive. Thanks.”

Glass told lawmakers that McGrath asked him to have the agency draw up a news release defending the payout.

At Tuesday’s hearing, he said the Aug. 15 document was written by the MES communications staff and Nevins & Associates, a public relations and advertising firm under contract with MES. The release defended the severance as “customary” and “a long-established practice.” Jim Harkins, who led MES from 2005 until 2016, for example, received one year’s pay of $256,746 when he retired, the release noted.

A lawmaker at the hearing asked Glass if McGrath “possibly” provided some of the language for the press release. Glass responded: “Yes, sir. Possibly.”

MES spokesman Dan Faoro would not directly say whether McGrath helped write the press release. He said Saturday in an email that the agency was pulling together documents related to the press release to provide to the legislative committee, which had requested them.

McGrath, reached by email, declined to answer questions about the press release. And David Nevins, CEO of Nevins & Associates, said Saturday that his staff only reviewed the press release after it was already drafted.

Looking back, Glass said the news release was a mistake, even though he gave final approval. “I do not believe it was appropriate to put this much information related to a decision that was before my tenure (and) that was inappropriate,” he told lawmakers.

McGrath also took to another venue to make his case: Facebook. While the governor’s office officially remained silent, McGrath in a pair of weekend posts criticized what he called The Sun’s “rush-to-judgement news story” and said he would not be drawn into “toxic partisan politics.”

McGrath stuck with that message when he resigned two days later.

“For me, this entire topic is simply the sad politics of personal destruction,” he said in a statement distributed by the governor’s office. He added that he was leaving so that he would no longer be a distraction to Hogan’s work.

McGrath later sent a letter to The Sun, expanding on his defense that MES is not really a state agency and the financial rewards were all earned.

McGrath hasn’t accepted interview requests and wrote in an email Saturday: “I don’t have anything further to add” beyond previous statements and an op-ed essay he wrote that was published in The Sun.

State lawmakers want to hear from him. McGrath was invited but didn’t appear at Tuesday’s meeting of the Joint Committee on Fair Practices and State Personnel Oversight. The committee has invited him to a meeting set for Wednesday as it weighs whether MES requires more oversight.

If McGrath’s departure indeed ends an unwanted distraction, the pandemic continues to demand much of the governor’s attention. Hogan picked Keiffer Mitchell Jr., an adviser since 2015, to replace McGrath on an acting basis. As he took over, Mitchell said the governor’s team “is working around the clock at such a critical moment in our history.”