On the agenda of the Maryland Senate today was the esoteric subject of motor vehicle auctioneering, a trade the legislature might have ignored if not for the efforts of one well-connected Prince George's County businessman and a state senator, Edward T. Conroy of Bowie.
Conroy's Senate Bill 662 on auctioneering levies no taxes, creates no new programs in state government and, in fact, seems to do so little of sifnificance that some of the legislators who unanimously voted it out of committee had trouble remembering it.
And yet, this proposal to require auctioneers of cars and other vehicles to get a state license is a textbook example of how one entrepreneur can use the General Assembly to his own advantage. In the parlance of Maryland politics, it is what is known as a "snake," a seemingly innocuous measure designed to help a special interest.
If the motor vehicle auctioneers measure is approved, it would significantly reduce the competition for ADB Auctions Systems, a Brandywine firm run by Walter Meinhardt, an influential friend of Conroy and other Prince George's politicians. Most of Meinhardt's competitors come from outside Maryland and would not be able to get licenses here under Conroy's proposal.
That windfall will come as no surprise to Meinhardt, a prominent Democrat who served as campaign treasurer for one of Conroy's colleagues and along with a brother contributed $500 to Conroy's own bid for the U.S. Senate last year.
"I asked Sen. Conroy to introduce the bill, and I'll be frank with you," Meinhardt says. "Naturally I'm trying to keep the competitioner down."
Conroy says he didn't know that Meinhardt proposed the bill in order to reduce his competition. He says he thought only that Meinhardt was proposing something that was needed. He says he agreed to support the bill only because state officials said the licensing of auctioneers was a good idea. o
But those officials really aren't so sure. In fact, they say that the only people who seem to think that the auctioneer's bill is needed are the principals of ADB, Meinhardt, his brother, and Larry Haskins.
Meinhardt, a wealthy Brandywine businessman who also owns an auto parts business and is president of a Brandywine bank, has good reason to support the legislation. For years, he and his partners have watched in irritation as up to 40 percent of the car-auctioneering business in the state has gone to large firms which roam the East Coast in search of such work.
It's not that ADB Auction Systems has been suffering. It normally auctions the used cars of companies like Pepco and C&P Telephone and government agencies such as the Washington Suburban Sanitary Commission, and in a average year will sell 30,000 cars for some $10 million. Only an estimated 100,000 cars are auctioned annually statewide, so ADB is far and away the state's leading company. "We may be the biggest in the nation," says Haskins.
They would like to grow even bigger. So Meinhardt decided to try to get the legislature to pass a bill that required auctioneer's firms to get state licenses and denied licenses to all companies that do not have a Maryland address. Such a change, by eliminating all out-of-state competition, would increase his company's gross income by 10 to 20 percent, Meinhardt figures, because there are no more than 10 motor vehicle auctioneering firms in the state.
"NATURALLY SINCE YADB is one of the biggest companies it will benefit the most," Meinhardt said.
Meinhardt first took his proposal last year to another Prince George's county senator, Thomas V. (Mike) Miller. Meinhardt is not only a close friend of Miller, but served as his campaign treasurer and sits on the board of the Bank of Brandywine with him. Meinhardt is also the past president of a prominent Democratic club in Miller's district.
Miller agreed to put in the bill for ADB, but later withdrew it before it could be studied by a committee. "I think I probably didn't understand the bill," Miller says now. "I think it's a (state) agency bill. I don't know any auctioneers.'
And so this year, Meinhardt decided to go to Conroy, the chairman of the Senate committee that reviews such legislation. "I have a hard time getting [Miller] to do anything anymore," Meinhardt noted. But Conroy quickly agreed to put in the bill.
"I talked to Meinhardt but I also talked to the state Motor Vehicle Administration," Conroy says. "That's the agency that is responsible for telling us whether a bill is fair or proper. And they endorsed it. They think it's a good bill."
Well, not really. "We shy away from not taking a position on a bill, so we tended to support it, but even so our stance is basically no position," explained Nance Stamboni, the MVA official who testified on Conroy's measure. ADBs Haskins, she noted, argued before Conroy's Constitutional and Public Law Committee that it was necessary to license auctioneering firms so that citizens would have recourse in cases of fraud.
"I told the committee that we had never had any reports of fraud, but that if they felt this was something they wanted to do, we had no problem with it," Stanboni said. "The bill is drawn very narrowly. It only affects a certain group of auctioneers.Apparently there's a problem that ADB is experiencing that the MVA isn't aware of -- or I assume there is, or they wouldn't be pushing this bill."
Apparently, not many others are aware of the problem, either. Aside from Stamboni, only three persons testified on Senate Bill 662 -- Haskins, the lobbyist for the auctioneer's trade association, and one small and disgruntled auctioneer who tried to persuade the committee to kill the bill.
But the committee members were impressed by Haskin's arguments that the measure was needed to prevent fraud by fly-by-night out-of-state firms and to "keep capital in Maryland." They approved the measure several days later by an 8-0 vote.
"No one testified that this bill was going to do anything but protect the citizens of Maryland," Conroy said. "I think it's a good bill."