She is the second Baltimore mayor in the past decade to be navigating a corruption scandal; Democrat Sheila Dixon resigned from office in 2010 after being convicted of embezzlement. Pugh narrowly defeated Dixon in the Democratic primary in 2016.
The Baltimore Sun reported two weeks ago that Pugh and eight other members of the hospital board had profited from UMMS contracts, which in some cases were worth millions of dollars.
“I sincerely want to say that I apologize that I have done something to upset the people of Baltimore,” Pugh said at the hastily scheduled appearance Thursday evening. “I never intended to do anything that could not stand up to scrutiny.”
The mayor, who stayed mostly out of public view after the book deal was revealed, resigned from the board last week and returned $100,000 for a final shipment of books she said was not completed. She was hospitalized with pneumonia Sunday night and discharged from the hospital Thursday.
Pugh told reporters that she was speaking to them “against my doctor’s orders.” She said she never had “any formal contract” with UMMS for the book sales, which began in 2011, when she was a state senator.
The Sun, which learned of the deal through financial disclosure forms, has reported that tens of thousands of the books are languishing in a warehouse for the Baltimore City Public Schools system or are unaccounted for.
Under the no-bid deal, the medical system bought a total of 100,000 books at $5 each, according to the Sun. Pugh did not report the earnings on annual General Assembly financial disclosure forms. She amended the forms after the deal was revealed.
Pugh, who is soft-spoken, sometimes mumbled as she addressed reporters and choked up toward the end of her remarks, which ran about 20 minutes. She did not take questions, saying her lawyers had advised her not to because the book deal is under investigation.
The Sun’s revelation of the UMMS contracts has sparked an uproar in Baltimore and in Annapolis, the state capital. House Speaker Michael E. Busch (D-Anne Arundel) has submitted emergency legislation that would dissolve the existing UMMS board, require an independent audit of the hospital system’s contracts and ban sole-source contracting for the hospital system.
Busch also sits on the 27-member board of the hospital system but has said he had no knowledge of the contracts awarded to other board members. The hospital system is privately run but receives substantial public funding.
UMMS president and chief executive Robert A. Chrencik, who has led the system since 2008, was placed on leave last week; several board members in addition to Pugh have resigned or taken leave.
Pugh is the only board member implicated in the scandal who currently holds elected office. Board member Francis X. Kelly served in the state Senate from 1979 to 1990; he disclosed that his insurance company made $2.8 million in deals with the hospital system last year and more than $1.6 million in 2017.
The mayor said Thursday that she published her first “Healthy Holly” book, which followed the adventures of a young African American girl, in 2010, three years after she became a state senator.
She said she shared the book with a colleague at UMMS, who thought it fit with the organization’s mission of helping children.
Pugh said she told the colleague, whom she did not name, that she wanted to distribute the book to students in Baltimore’s public school system. She said the initial agreement was that she would be paid $100,000 for 20,000 books, or $5 a book.
“It certainly seemed like an ideal way to combine focuses,” she said.
Pugh, who has sat on the UMMS board since 2001, produced a 2011 letter showing that UMMS gave the books to the school system as a donation and shipping labels showing their delivery.
The letter, to Baltimore schools chief executive Sonja Brookins Santelises, says the medical system “would like to continue this history of community outreach” by donating 20,000 copies of “Healthy Holly: Exercising is Fun!”
“This publication provides schoolchildren with positive messages about the benefits of healthy lifestyle choices,” wrote Jerry Wollman, senior vice president and chief administrative officer at UMMS.
Pugh also produced shipping manifests for three orders of her books and said the fourth order was delayed in its delivery and is in the process of completion. The fifth order was never completed, she said, because the designer “got very ill.”
Pugh said the “ ‘Healthy Holly’ initiative was not “about books. . . . It was about a lifestyle.”
She displayed bibs, jump ropes and a swaddling blanket that her company sells, which she described as part of her efforts to care for the children of Baltimore.
“My thought process was, ‘What else can we do to make sure our children live healthfully?’ ” the mayor said.