Ethics Commission Should Investigate Gov. Hogan's Apparent Financial Conflicts of Interest Related to New Interchange And Other Improvements

The Maryland State Ethics Commission should investigate whether Gov. Larry Hogan has conflicts of interest related to his public office and private business interests that could violate state ethics laws, Public Citizen said today in an ethics complaint to the commission.

Hogan founded and served as president and CEO of The Hogan Companies (now HOGAN), a Maryland real estate firm; after he took office, his brother became president of HOGAN. Nonetheless, Hogan maintains a financial stake in the company. Hogan's income from his business interests has far exceeded his gubernatorial salary. He has earned more than $2 million from these investments during just the first three years of being governor - more money than any other sitting governor has earned in the history of the state. These business stakes have led to concerns that Hogan may be making official decisions in public office concerning transportation, the environment, affordable housing and other development projects that have enriched himself and his family.

Hogan appears to have directly participated in making a major change to the 2015-2020 Capital Transportation Program and related 2015 transportation budget. His decision to expedite the construction of, and designate $58 million for, a new highway interchange in Brandywine, Md., enhanced the development value of several parcels of land HOGAN acquired during the state construction project. Hogan reportedly did not inform the Maryland General Assembly of his financial interests while seeking funding for the state project, which he is required to do under state law.

In addition to the Brandywine interchange, his administration has advanced other improvements in the same area, including the construction of embankments, exit ramps and median piers, a new park-and-ride lot and a bridge.

State public ethics law says that "an official or employee may not participate in a matter if ... the official or employee or a qualifying relative of the official or employee has an interest in the matter."

Meanwhile, other properties owned by HOGAN also have benefited from other transportation and land development projects begun during his administration, such as projects near HOGAN's the Villas at Severn Crest and a townhouse development project at Queens Chapel Road.

Hogan attempted to address some conflicts of interest by placing his properties into a trust. However, the trust is managed by the governor's business partners, and the company remains under the control of the Hogan family, leaving Hogan's trust falling short of a genuine blind trust sufficient to avoid conflicts of interest.

"It's as if Hogan is taking his ethics cues directly from President Donald Trump," said Craig Holman, government affairs lobbyist for Public Citizen. "Maryland has a good conflict of interest statute on the books. The state ethics commission should enforce it."

Public Citizen requests that the commission investigate these allegations and impose appropriate sanctions if it determines that Hogan's conduct violates the law. Public Citizen also asks the commission to ensure that any future efforts to avoid conflicts of interest by Hogan, such as establishing a blind trust, be done in a proper and effective manner.

The complaint is available here.