Gary in debt to lobbyist for 1994 loan County executive owes $7,000 to Neall campaign committee

'Higher standard to meet'

Some GOP colleagues say money should have been repaid

September 15, 1996|By Scott Wilson | Scott Wilson,SUN STAFF

Because of a typesetting error, Sunday's Anne Arundel edition of the Sun about former County Executive Robert R. Beall's lobbying incorrectly stated the size of the proposed Dorchester residential development. The subdivision near Baltimore-Washington International Airport could have as many as 1,600 homes.

The Sun regrets the error.

Robert R. Neall, Anne Arundel's former county executive turned lobbyist, has parlayed a reputation for fiscal expertise, personal friendships and lavish campaign contributions into enviable access to the most powerful offices in county government.

Neall has turned his standing campaign committee, Bob Neall in '94, into a personal political action fund. Over the past three years, the committee has handed out more than $75,000 to state and local Republican candidates, including generous donations to the Republican County Council majority.

FOR THE RECORD - CORRECTION

A prime beneficiary has been his successor and close friend of more than two decades, County Executive John G. Gary, whose election committee owes Bob Neall in '94 almost $7,500 on a 1994 campaign loan.

"It raises questions when a prominent elected county official is indebted to a lobbyist for any reason," said Deborah Povich, executive director of Common Cause Maryland, a citizen watchdog group. "It sets up a whole unseemly appearance of insiders dealing with each other in a manner that skirts propriety. These loans get close to the line, if not cross it."

Gary dismissed the possibility of conflict of interest, saying, "Bobby Neall didn't have to loan me any money to have access to me. I will pay off my loan. My intention has always been to pay it off in thirds as I get the money."

But Neall's deep personal and financial ties to the county's Republican leadership may soon be used to transform more than 800 empty acres in the center of Anne Arundel into a $300 million development of homes and townhouses.

As soon as next month, the Gary administration plans to introduce legislation authorized by the General Assembly this year that would for the first time allow Anne Arundel to issue bonds on behalf of specific developers to help finance infrastructure. One company that stands to benefit is the Driggs Corp., a Prince George's County construction company that is one of Neall's most important clients.

If approved by the County Council, Anne Arundel could issue $15 million in bonds to help pay for roads, sewers and parks around Dorchester, a 600-home development that Driggs hopes to build near the Baltimore-Washington International Airport.

The bonds would be a low-interest loan to Driggs, which could save millions of dollars in interest payments. The money would be paid back over 30 years through a special tax district at no cost to the county.

"I am very circumspect about the causes I take on," Neall said. "I think Dorchester is going to be a wonderful project for what is going to be the future breadbasket of the county."

In the 1994 campaign, Gary presented himself as the heir to Neall's legacy of fiscal restraint. But the respect extended beyond politics. On a personal level, according to one administration official, "John would take a bullet for Bobby."

As the campaign wound down, Gary found himself in a tight race with Linthicum Democrat Theodore J. Sophocleus, who was claiming a commanding lead. Gary already had received a $5,750 contribution from Bob Neall in '94, close to the $6,000 limit set by state law.

Then, with less than two weeks before election day, Sophocleus received a cash infusion. Orioles owner Peter G. Angelos made a $15,000 personal loan to the Sophocleus campaign at a favorable interest rate, 1 percentage point below the prime rate.

Last-minute help

Gary needed help. On Nov. 3, five days before the election, Neall authorized his committee to lend Gary's campaign $12,000. The interest rate was 8 percent, a quarter of a percentage point above prime rate.

Puzzled by his opponent's claim of certain victory, Gary used the money to pay for a last-minute poll that showed he was still very much in the race.

"We needed to do it then," Gary said. "And we didn't have the money."

Most important, the poll revealed that pension reform was a hot issue among voters. Gary took the cue. He flogged Sophocleus in the campaign's final days for voting to increase his own pension as a council member.

Gary won with 53 percent of the vote.

Sophocleus, who is considering a run for office in 1998, has paid off the Angelos loan. Gary has chipped away at the principal of his loan, but his committee, which has a cash balance of $32,531, still owes $7,492, according to the most recent campaign disclosure reports.

Maryland law requires campaign loans to be paid off within four years.

Several of Gary's Republican colleagues said the outstanding loan between lobbyist and county executive, who has authority over land-use issues, presents at least the appearance of a conflict of interest.

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