The MES Summer Sizzler…What? By Craig Fuller

Local news organizations have handed us a series of muckraking stories involving the Maryland Environmental Service, its former director, the state legislature and the governor. Seems pretty exciting. Also, might be all wrong.

Stories would have us believe that an individual – someone I have known for a long while –received a payment as he left one high-level position in State Government for the Maryland Governor’s office. The Governor and his staff seemed shocked…never heard of it…never approved it. Then we learn that the Board of the entity granting the post-employment payment did so because they thought the Governor approved of it.

Some story, right?

Well, consider this…the Maryland Environmental Service Act from the 1990s set up a “corporate” “instrumentality” of the state in order “to assist with the preservation, improvement, and management of the quality of air, land, water, and natural resources, and to promote the health and welfare of the citizens of the State…”

In every sense, about three decades ago, the State of Maryland decided to contract out to a corporation established by the state a broad range of environmental services. The Act specifically states: “The Service (MES) has all powers necessary for carrying out the purposes of this subtitle, including the following rights and powers set forth in this section…to have perpetual existence as a corporation.”

Anyone can find a very lengthy description of this in the Maryland Code, Natural Resources 3-102 through 3-130.

The Act separates the Maryland Environmental Service from state personnel systems and calls for it to establish its own. The Act even specifies methods by which people in state government will move into the new entity. The Act grants full authority to MES to set its budget, asking it to send a copy to the state Budget Office for information. The MES is to design its own strategic plan. Additionally, MES was granted authority to borrow money through bonds for projects making it clear these and other financial obligations were the responsibility of MES.

Indeed, the State of Maryland wisely decided that a more private sector approach to the large scale environmental services needed throughout the region would be better than allowing the functions to be part of a state agency.

Turns out, when Governor Hogan appointed Roy McGrath as the director of MES, the new director took his role, responsibility and independence seriously. During his tenure, the functions contracted for by the State of Maryland were performed and then MES successfully won contracts from other jurisdictions who chose to “contract out” for MES services.

Growth was fairly dramatic and the capabilities of MES expanded to better address the needs of entities throughout the region, including the State of Maryland.

Had Maryland decide to contract with a private corporation serving the region and then had the head of the organization been selected to go into the Governor’s office, few would have chosen to examine how the company compensated an outgoing leader.

Somehow, the current state officials who do not to understand the Maryland Environmental Service Act want to treat MES like the state agency it was specifically designed not to be by the Act.

Why then, the drama.

Well, most boards today would reward a very successful leader with a post-employment package. And, most corporate entities would not release the terms of such a package. For some reason, MES elected to do so. However, in doing so, they have allowed for comparisons with other organizations employing over 1,000 people with hundreds of millions of dollars in revenues. Such a comparison could fairly suggest the director of MES is underpaid in the marketplace not overpaid.

Then there is the question of the Governor’s role. Honestly, he doesn’t have one beyond the power to appoint certain people. MES exists as independent from his authority. The MES board sets and determines compensation matters. If the Governor has a view, he is certainly entitled to it, of course.

Lastly we come to the intent of the outgoing director. I have not discussed my commentary with him; however, based upon the facts, he would be just in exploring a payment recognizing his success as the head of a multimillion dollar enterprise that has successfully pursued its mission during his tenure. And, knowing that the decision by the MES board to grant a post-employment payment had or would be made, the incoming chief of staff would be faulted for not advising the Governor of the fact.

Our saga could end here but for the fact some key decision makers elected to ignore their authorities and those of the Governor.

Reportedly, MES board members sought to know if the Governor “approved” of the payment before they made a decision.

Asked to confirm the Governor’s approval, the former MES director and current Chief of Staff indicated the Governor was aware and that this action was “anticipated.”

So, the MES board sought something that should not have been given (i.e. the Governor’s approval of a post-employment package) and when told he was aware mistakenly took that for approval.

As for the Governor, there have been three phases: first, no comment; second, there was no approval or knowledge prior to the MES Board’s action; and, three, I knew nothing.

Well, the Governor could be excused for not knowing the timing of the Board’s action, but text messages recovered seem to suggest “knowing nothing” is not a good place to hang one’s hat.

What has been missed in the breathless reporting of this story is the very sound reason for setting up the Maryland Environmental Service as the state legislature did in the 1990s. Also missed is that the structure demands much of the top leader of the organization to balance environmental challenges with financial challenges and considerable public needs. To find someone who actually flourishes in such an environment is without a doubt exactly what the sponsors of the Maryland Environmental Service Act must have hoped for with the Act’s passage.

So, the Summer Sizzler is more a Shakespearean tragedy where a high price is being paid by the one individual who did the most to advance the mission of the Maryland Environmental Service.

I surely will be asked why I took the time to look into this. Yes, in no small part because Roy McGrath is my friend. But, also because if we allow people who engage in important work on behalf of citizens to bear the brunt of criticism and judgements from those who elect not to understand the facts, then we will have a difficult time recruiting people with a record of experience and good ethical judgement to these roles.

What we need is less bureaucratic agency think and more executive leadership. In this battle, executive leadership is not winning.

Craig Fuller served four years in the White House as assistant to President Reagan for Cabinet Affairs, followed by four years as chief of staff to Vice President George H.W. Bush. Having been engaged in five presidential campaigns and run public affairs firms and associations in Washington, D.C., he now resides on the Eastern Shore.