BALTIMORE MAYOR Catherine E. Pugh’s resignation Thursday was a fitting capstone to the pay-to-play scandal that left a stain on her city and prompted emergency legislation in Maryland’s General Assembly. The Democratic mayor’s conduct — selling her “Healthy Holly” children’s books to companies over which she exercised influence — was ethically bankrupt.
But what of those companies? They share a measure of responsibility for acquiescing in the mayor’s scheme, but it is unclear whether they have drawn (or been taught) that lesson.
The most egregious offender was the University of Maryland Medical System, a health-care behemoth with 25,000 employees that runs 13 state hospitals. It paid $500,000 to Ms. Pugh for her books, many of which wound up in a warehouse, at the same time that she sat on the UMMS board and, as a state senator, on a legislative committee in Annapolis that oversaw funding for the organization.
As it turned out, Ms. Pugh was not the only such offender on the board — a third of its members also worked at firms that had contracts with UMMS. The fallout from those revelations was swift: UMMS’s chief executive resigned; board members also stepped down, though they are entitled to reapply; and emergency state legislation was enacted to bar future insider deals by UMMS board members.
Among other entities that were ensnared in Ms. Pugh’s web, willingly or less willingly, reform remains an open question. One example is Kaiser Permanente, which paid Ms. Pugh’s company $114,000 even as it sought a $48 million contract to provide health insurance to Baltimore city workers — a contract over whose approval Ms. Pugh exercised sway as mayor and as a member of the city’s spending board.
In a statement issued when the Baltimore Sun reported the payments last month, Kaiser said its 30-year record as an insurance provider in Baltimore, and past book purchases in communities it serves, proved that the payments to Ms. Pugh’s company for the “Healthy Holly” books had “absolutely no connection to the government contract renewal.”
In fact, it strains credulity to believe that the timing and price paid for the “Healthy Holly” purchases were in line with past business practices — to say nothing of the fact of the influence over city contracting decisions exercised by the seller, Ms. Pugh. Kaiser had every reason to understand Ms. Pugh’s conflict of interest along with the glaring optical and ethical questions its own purchases raised. The company says it is reviewing its selection and procurement process for books; it should do so for other purchases where elected or unelected officials with influence over its business or contracts would be the beneficiaries.
So should CareFirst, another insurance provider in Baltimore, which made contributions of more than $14,000 through a local nonprofit, Associated Black Charities, to purchase Ms. Pugh’s books — part of some $87,000 that ABC collected from various entities for that purpose. CareFirst’s contributions were made before Ms. Pugh was mayor but while she was a powerful state lawmaker representing the city.
In this unseemly story, Ms. Pugh is the chief culprit. But those who grease the palms of public officials have as much to answer for as the greasy-palmed officials themselves.