Prince George's County Executive Lawrence Hogan agreed yesterday to allow the county Board of Ethics to study a controversial business loan he approved for a firm represented by his lawyer wife.
Hogan's agreement to submit the issue to the ethics panel came on the same day that County Couuncil members, clearly upset by disclosures of Hogan's relationship to the loan-seeking company, District Moving and Storage Inc., began questioning other firms requesting loans about their possible ties to the Hogan law firm.
The council also gave its approval to a state-backed loan for the Garfinckel's department store chain, which is seeking money to build a warehouse in the county. That loan had been rejected earlier by Hogan and a Garfinckel's executive said he was told when Hogan was considering the loan that the county executive might approve it if the company contributed $80,000 to a county-endorsed charity.
The unusual action by member of the council's Fiscal and Planning committee were prompted by publicity surrounding the proposals by District Moving and Garfinckel's to build warehouse facilities in Prince George's with low-interest loans sponsored by the Maryland Idustrial Financing Authority.
Council members said they were troubled because hogan had consistently opposed the Garfinckel's development -- saying that he opposed more warehouses in the county -- yet had approved District Moving's application.
Council member Parris N. Clendening said Hogan's failure to disclose the attorney-client relationship between District Moving and his firm of Hogan and Hogan when he supported the company's loan application had cast the loan program 'in a very bad light."
Hogan, who has maintained that he acted in the county7s best interest on both loan applications, yesterday submitted a memo to the council explaining why he rejected the Garfinckels application.
Hogan said that Garfinckel's had proposed "nothing more than a typical warehouse operation" and had refused, unlike District Moving, to locate its headquaters in the county.
He said he would be willing to reconsider the Garfinckel's application if the firm moved its headquaters and audit and credit operations to Prince George's and considered building more retail stores in the county.
At the same time, Hogan agreed to a request made by the council last Thursday that he allow the county Ethics Board that served under former executive Winfield M. Kelly Jr. to study the District Moving loan.
Only three days ago, Hogan's press aide, Jim Threatte, said Hogan could not submit the case to the ethics board because the terms of the panel's members had expired with Hogan's inauguration.
The usual county policy, however, has been that members of boards served until their replacements are appointed and confirmed.
Threatte said yesterday that he had not spoken to Hogan when he made the earlier statement and that Hogan had decided to comply with the council's request.
In its deliberations yesterday, the council's fiscal committee quizzed two firms that were seeking county-endorsed MIDFA loans -- Garfinckel's and Peake Printers. Both firms were asked whether they had ever had any dealings with Hogan and Hogan. Both said they had not. Council members said that in the past they had never asked such detailed questions about the legal relationships of loan-seeking firms, but felt compelled to do so now because of the recent controversy.
Glendening said that the council would try to reach "an understanding" with Hogan on the Garfinckel's loan before submitting it to the state for approval. However, Glendening said that if Hogan does not agree to support the proposal, the council would unilaterally forward the loan application to state officials.