Almost every day for the past week, as the Maryland Senate convened, William Weaver has taken a seat in the gallery above the Senate floor, watching as two legislators clear away the final obstacles facing a bill that would produce millions of dollars in increased profits for the state's banking industry.
The bill's opponents already have conceded there is no way they can stop the measure raising interest rates on small bank, loans and credit card accounts from 12 to 18 percent. All they can do, they say, is stand in bitter awe at the wonders lobbyist Bill Weaver has worked in getting his measure packaged and stamped for approval by some of the most powerful politicians around here.
Weaver and the banking lobby, said one state senator, "have a very practiced plan of currying favor, which they've used over a long period of years."
Part of the process, which lawmakers are pointing to these days, was a three-day banking convention last May at the swank Boca Raton Hotel and Club on Florida's "gold coast" to which Weaver accompanied five Maryland legislators. The guests at that sunny session included the sponsor of the interest-rate measure, Sen. Jerome Connell Sr. (D-Anne Arundel) and Sen. Harry J. McGuirk (D-Baltimore), chairman of the committee that passed the measure two weeks ago.
Also on hand were three other legislative committee chairmen.Sen. Laurence Levitan (D-Montgomery), Sen. Edward T. Conroy (D-Prince George's) and Del. John R. Hargreaves, a Democrat from Caroline County on the Eastern Shore.
None of the legislators paid for their plane trips or their hotel stays.They did, however, participate in panel discussions.
None of the legislators involved feel the trip represented a conflict of interest -- as some of their colleagues have charged -- or that it has influenced their position on Weaver's pet bill.
"When I sponsor a piece of legislation, it's because I think it's good law, good for the banks and good for the consumers, or else I don't sponsor legislation," said an irate Connell, who once was a banking officer himself. "I could probably buy and sell you. I have enough money to go where I want to go when I want to go. I don't need any bribes from anybody."
Added Levitan: "When you set yourself up in a position that you don't go anywhere or see anyone, you set yourself up in an ivory tower. I think it's very important for legislators to get out and meet the business community, the banking community . . . Everyone's always trying to find something sinister about attending a convention."
As far as McGuirk is concerned, attending the Boca Raton conference "is no more evidence of undue influence than if I'm invited to Hunt Valley by the League of Women Voters or Bedford Springs (a resort in Pennsylvania's Pocono mountains) by the Chamber of Commerce.
"It's an educational process. I tell them about how committees work and I learn from them about their industry."
Whatever the impact of the Boca Raton venture, it was just one of many approaches Weaver has used in getting to know, and working his way on, the legislators who would vote on the interest rate bill. As Sen. John A. Bishop, a Baltimore County Republican who unsuccessfully attempted to modify the bill, put it: "A special interest bill doesn't go through as easily as this one this early in the session unless a lot of good work is done ahead of time."
Weaver's lobbying included long individual conferences with many of the Senate's 47 members long before the session started last month.
In one case, this lobbyist who wears a sober expression along with his three-piece suits, brought a lawmaker's home town banker with him when he made his plea. The banker, who manages the legislator's checking, savings and loan accounts, sat silently by as Weaver tried to win the senator's support.
Last year, Weaver spent more than $5,000 on his lobbying efforts in Annapolis, maintaining a neat brick office building two blocks from the State House and taking lawmakers out on the town. And, during the 1978 election campaign, the political action committee of the Maryland Bankers' Association gave nearly $5,000 in contributions to 28 current members of the state senate.
Lobbyist Weaver said yesterday that the bankers' conference, last year attended by more than 600 Maryland banking officials, "is an annual [event] where senior banking officers . . . have a chance to get together with speakers who have a state and a national reputation," and not a lobbying effort.
The interest rate measure introduced by Connell, he said, stands on its own merits: he argues that at a time when the prime interest rate nationally is 15 1/2 percent, it gives bankers the freedom to make loans they otherwise simply would refuse to make.
"The only product a bank has to sell is money and they have to pay to get it," he said. Would it make sense if they had to pay 12 percent or more to get money, and then had to lend it out at the same 12 percent?" Rather than do that, he said, banks would instead refuse to make loans.
Connell's bill, as amended in McGuirk's committee, would affect three types of consumer loans: the unpaid balances in their credit card accounts, the small installment loans they take out to buy such items as a car or a boat, and the "demand" loans taken out by consumers who need money quickly and are willing to let the bank call in their debt on demand.
If passed and signed into law, the measure would allow, the nine state banks that have issued nearly 1 million bank cards to charge 18 percent annual interest on unpaid balances of up to $700. Currently, this interest rate is allowable only on balances of $500 or less.
In the case of installment loans, the bill would allow banks to charge a flat 18 percent annual interest rate. Currently, any loan of more than $3,500 can carry an interest rate of no more than 12 percent. The same 18 percent ceiling would cover demand loans, for which state banks now may charge no more than 12 percent.
The profits of state banks, which increased steadily for four years before dipping from $16 million to $127 million between 1978 and 1979, are expected to rise to $171 million next year even if the connell bill fails, according to the legislature's fiscal services department.
Weaver argues that the current interest rate ceilings were enacted in 1966, when the prime interest rate nationally stood at 4 1/2 percent. In 40 states, including Virginia, he said, the interest rate for credit card holders already stands at 18 percent. The District of Columbia's restrictions, he added, parallel the existing Maryland laws.
But, said Sen. Bishop, "I've never seen that much of an increase [in interest rates] at one leap on these kinds of loans . . . There's no question that this bill would provide some help to lenders and there's no question the banks need some sort of increases. But why this much?"
"For consumers, this means a lot more that they're going to have to pay," said State Sen. Julian L. Lapides (D-Baltimore), another of the bill's opponents. "We've already heavily indebted our Marylanders and they're going to reach the breaking point soon."
Connel, still seething at the criticism of his trip to Florida, said he sponsored the interest rate measure because lobbyist Weaver "and a couple of local bankers asked me to put it in . . . When I put in this type of bill, I expect [sen.] Lapides and Bishop to do their thing. It makes them look good for you guys in the press . . . but his bill is good for banks and consumers."