On a financial disclosure form, Pugh listed a $100,000 profit for one year from selling 20,000 copies of her self-published children’s book series “Healthy Holly” to the University of Maryland health system, which runs 13 hospitals including the state’s trauma unit in Baltimore and has connections with the state’s dental and medical schools.
Hogan described the financial contracts, which are worth hundreds of thousands of dollars, as “appalling” and “unseemly.” Senate President Thomas V. Mike Miller Jr. (D-Calvert) called them “self-dealing” and “a huge disaster.”
House Speaker Michael E. Busch (D-Anne Arundel), who has been on the board for 16 years, said the unfolding scandal was the worst he’s seen in Maryland politics. He said he, Hogan, Miller and high-level staff from the hospital system will meet in Annapolis on Wednesday.
The deals were first disclosed last week by the Baltimore Sun, which reported that Pugh’s deals with the hospital board totaled $500,000 over several years, and were not fully listed on disclosure forms when Pugh represented Baltimore in the state Senate.
Other board members who had lucrative deals included former state senator Francis X. Kelly, who owns an insurance company and reported $1.6 million in revenue from deals with the hospital system.
Officials at the hospital system have said their contracts are legal. Legislation pending in the General Assembly would ban such arrangements.
In a statement put out Monday explaining her resignation, Pugh, who has served on the board since 2001, said she had “other pressing concerns that require my full attention, energy and efforts.” The Sun reported Friday that she had amended her state disclosure forms from her time in the Senate.
The system’s board members are appointed by the governor and the General Assembly’s presiding officers.
Hogan said Pugh’s resignation was “a step in the right direction. ” Last week, he called on board members with contracts with the health system to step down.
“We’re going to push for major reforms to make sure people either terminate their financial relationship or terminate them from the board,” Hogan said Monday. “One way or another, [we’ll] make sure that things like this don’t happen in the future.”
In a statement, Stephen A. Burch, chairman of the UMMS, said he had accepted Pugh’s resignation and was “grateful to Mayor Pugh for her years of dedicated service.”
Miller said he met with Burch on Monday and expected more resignations later this week. “It’s a very unfortunate chapter in all our lives, and we need to learn from it,” he said.
Pugh’s spokesman James E. Bentley II said the mayor is leaving the board to deal with pressing issues in Baltimore.
“We have a new police commissioner,” he said. “We’re trying to fund city schools. The mayor is focused on neighborhood revitalization and running the city.”
Erin Cox contributed to this report.