Gov. Martin O'Malley and legislators said yesterday that stronger oversight and new management are needed at the Maryland Stadium Authority, but officials at the agency said reports of hundreds of thousands of dollars in severance packages paid to former employees without proper oversight were "salacious" and overblown.
General Assembly auditors presented a report to legislators yesterday showing the authority had paid $42,000 to a former executive director for less than an hour of work and $282,000 in severance packages without any guidelines for how they would be awarded or any oversight by the agency's board.
FOR THE RECORD - An article on Page 1A yesterday and an accompanying graphic incorrectly reported details of Otis Rolley III's appointment to the Maryland Stadium Authority board. Rolley was nominated by Baltimore Mayor Sheila Dixon to replace Samuel J. Lloyd as the mayor's sole appointment to the board.
The Sun regrets the error.
Although authority Chairman Robert L. McKinney defended the arrangements as "the cost of doing business," legislative leaders said they will likely take a much stronger hand in managing the state agency.
O'Malley said the audit will be the basis for a change in leadership at the authority, which is governed by a board dominated by appointees of Gov. Robert L. Ehrlich Jr.
Last week, O'Malley nominated Fred Puddester, a former head of the state budget department, as chairman.
"The audit gives us an opportunity to stir things up on the Stadium Authority and put in new leadership," O'Malley said. "I can tell you we're aware that there are problems at the Stadium Authority, which is why I put someone of Fred Puddester's caliber and ability there."
The auditors also found that the agency did not try aggressively enough to collect $1.7 million the authority believes it is owed by one of its principal tenants, the Orioles.
Ehrlich had a close relationship with Orioles principal owner Peter G. Angelos, who is a major Democratic donor but supported the Republican governor in his re-election bid against O'Malley.
McKinney, appearing before an Appropriations subcommittee hearing, said that the problems identified by the audit largely occurred under a previous chairman and executive director and that the severance packages were necessary in some cases to guard against lawsuits.
"The Maryland Stadium Authority, despite the press reports, is being very well managed, very well run," McKinney said. "The auditors' report, unfortunately, has been made salacious in the press reports."
Del. John L. Bohanan Jr., a St. Mary's County Democrat who chairs the subcommittee that held yesterday's hearing, said the Stadium Authority can't explain away the auditors' report as bad press.
"That's what happens when you issue $282,000 in severance payments without any oversight by the board," Bohanan said.
Puddester sat in the back of the room during the audit presentation yesterday and said he takes the report seriously, though he said in an interview that it is too early to say how he will address its findings.
The Stadium Authority was created 20 years ago to construct and manage two sports stadiums in Baltimore. It built Oriole Park at Camden Yards and M&T Bank Stadium. Since, it has gone on to construct other projects, including the Comcast Center at the University of Maryland, College Park and the redevelopment of the Hippodrome Theatre in Baltimore.
The authority is governed by a seven-member board and has an annual budget of $76 million. O'Malley has nominated Puddester to replace McKinney and Otis Rolley III, Baltimore Mayor Sheila Dixon's chief of staff, to replace former Prince George's County Executive Wayne K. Curry on the authority board.
One member, attorney Samuel J. Lloyd, is the mayor's designee to the board, and the terms of the other four board members, all Ehrlich apointees, have not expired.
McKinney said the authority awarded a $42,000 contract for Richard W. Slosson after he was fired because he had been involved in managing the Hippodrome renovations, which were then under way. McKinney said they wanted to retain his services during a transition period as "an insurance policy."
The auditors found that Slosson was paid the $42,000 but essentially did no work. McKinney said that was their hope - Slosson had been fired for a reason, and the authority board hoped not to involve him further in its projects, though it was reluctant to completely sever ties in case his expertise was needed.
Lawmakers said that sounded like a payoff to avoid a lawsuit.
"Basically what you're saying is, this was part of a settlement for his departure, not a contract for service," said Del. Galen R. Clagett, a Frederick Democrat who sat in on the hearing. "Did it protect you in writing from litigation?"
McKinney said he was "reasonably sure" it did.
The auditors also found that the authority had awarded $282,000 in severance pay without a formal policy or oversight by the board. One executive who left was given $104,000 after 15 months of service, while a maintenance worker was given $1,100 after having worked there for eight years.