By Adam Pagnucco.
Andrew Kleine, the county’s Chief Administrative Officer and the highest-ranking non-elected employee of the county, has admitted to violating two provisions of the county’s ethics law and has offered to cure those violations in part through a $5,000 payment to the county. Bethesda Beat reported that Kleine was the subject of an ethics investigation in September 2019.
The document released today by the county’s Ethics Commission contains a summary of the violations and other related matters, the content of Kleine’s proposal to cure the violations, and a redacted investigatory report by the county’s inspector general with more detail.
The issues with Kleine involve two private companies – Healthy Outcomes Inc. (aka Balancing Act) and Clear Impact LLC. Kleine worked with the two companies when he was Baltimore City’s budget director. When Kleine left his position at Baltimore City, he formed his own company (Andrew Kleine Consulting LLC) and wrote a book. Kleine’s company entered into formal contracts with Balancing Act and had an “informal, mutually beneficial arrangement” with Clear Impact before he joined the county government. Kleine subsequently was appointed by County Executive Marc Elrich and confirmed by the county council as the county’s Chief Administrative Officer, the top manager in county government, in December 2018.
Kleine’s contracts with Balancing Act, which allowed the company to claim some of his book revenues, were terminated on January 24, 2019. Neither side derived any revenues from the book. Kleine “was involved in establishing the relationship between the County and Balancing Act” which led to a one-year county contract with the company for $9,880 on 12/21/18, while Kleine’s own contracts with Balancing Act were in effect. The commission wrote:
Mr. Kleine understands that the ethics law prohibits him from participating in any matter with a business that he has a contract with, if the contract could reasonably result in a conflict between private interests and public duties. (19A-11(a)(2)(E)). Although Mr. Kleine never received any funds from Balancing Act, Mr. Kleine acknowledges that he violated this provision of the Ethics Law.
In May 2019, Balancing Act – now a county contractor but no longer in a contractual relationship with Kleine – sponsored a signing for Kleine’s book which earned him $42 in royalties for 20 books. The commission wrote, “While having the book signing was Balancing Act’s idea and the gain was very small, Mr. Kleine further realizes there has to be a complete severance of his private business activities and his official duties.”
Clear Impact LLC
Clear Impact paid $5,000 to Kleine for book promotion expenses on July 1, 2018 in return for having its logo printed on the back of Kleine’s book. The commission wrote, “At Mr. Kleine’s request, the Leggett administration engaged Clear Impact in a $10,000 non-competitive contract to facilitate the work of the Elrich Transition Team, starting the day after the election.” In May of 2019, Clear Impact won a $99,000 competitively bid contract to which Kleine remained at arm’s length.
The commission wrote, “As of September 30, 2019, the County and its employees had purchased 89 copies of the Book, although Mr. Kleine was unaware at the time that County funds were used to buy those books.” The commission went on:
Mr. Kleine was invited on a few occasions to discuss the Book and his strategy for budgeting while he was at conferences or meetings he was attending in connection with his County work. Where these activities required use of County resources or of Mr. Kleine’s title, or otherwise appeared to be conducted as part of Mr. Kleine’s official duties, Mr. Kleine recognizes such activities constituted a misuse of County resources and/or a misuse of the prestige of Mr. Kleine’s office.
The commission noted that Kleine did not seek advice from the County Attorney or the Ethics Commission on the ethics implications of his relationships with Balancing Act and Clear Impact or his book promotion.
Outside Employment Approval
The commission wrote:
Mr. Kleine did seek outside employment approval from the Ethics Commission in late April of 2019 to engage in consulting and promotion of the Book through the Company [ed. – Kleine’s own company]. While the Commission approved the request on June 6, 2019, the Commission had not been informed of the relationships between Mr. Kleine, the Company, and Balancing Act, of Mr. Kleine and Clear Impact, the Book’s relevance to the budget strategy being implemented in Montgomery County, and the lack of separation between promotional activities associated with the Book and Mr. Kleine’s official position. In addition, Mr. Kleine recognizes that he should not have been engaged in any activity resulting in earned income (no matter how minimal) prior to receiving outside employment approval in accordance with requirements in the ethics law. Mr. Kleine acknowledges that his doing so violated 19A-12 of the Ethics Law.
Kleine’s Proposed Cure
Kleine had already terminated his contracts with Balancing Act and removed references to Balancing Act and Clear Impact from his professional website. Kleine proposed to cure the ethics violations through the following additional measures.
Forfeit his approval of outside employment.
Stop promoting the book to county employees and others.
Remove references to his occupation and to Clear Impact from the book’s website.
Not be involved with any matters concerning Balancing Act or Clear Impact without obtaining advice or a waiver from the Ethics Commission.
Direct the county’s chief procurement officer to ensure that no further county funds are spent purchasing his book.
Pay the county $5,000 within 30 days of his proposal to cure the violations.
The commission’s website indicates that it has accepted Kleine’s proposed cure, thereby making its report a public document.