Tag Archives: Andrew Kleine

End of the Line for Kleine

By Adam Pagnucco.

Chief Administrative Officer Andrew Kleine, who admitted to two ethics violations and attempted to cure them through a $5,000 payment and other remedies, has resigned. County Executive Marc Elrich has announced that former State Senator and current budget director Rich Madaleno will succeed him subject to confirmation by the county council.

Originally, Kleine was set to remain in his position. Bethesda Beat reported this on July 7:

County Executive Marc Elrich, in a statement to Bethesda Beat on Monday, wrote that Kleine is a “committed public servant” and that the CAO’s agreement with the Ethics Commission “resolves the matter.”

“Andrew has acknowledged that his actions were an error in judgment and has accepted responsibility for his actions,” he wrote. “I appreciate that Andrew has cooperated with the Ethics Commission’s investigation from the very beginning to resolve this situation.”

But the matter was far from resolved. On July 28, the county council discussed the ethics report and erupted with fury. Multiple council members vowed to obtain more information about the issue, guaranteeing that it would not die as long as Kleine remained. That forced Elrich’s hand and resulted in today’s announcement, the first resignation of a MoCo Chief Administrative Officer due to ethics issues that anyone can remember.

Elrich’s press release appears below. If there is a severance package, the release does not mention it.

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County Executive Marc Elrich Nominates Budget Director Rich Madaleno to Serve as New Chief Administrative Officer Following Andrew Kleine’s Resignation
For Immediate Release: Wednesday, Aug. 12, 2020

County Executive Marc Elrich today announced that he will nominate Richard Madaleno as the Chief Administrative Officer (CAO) for Montgomery County. Madaleno’s nomination follows the resignation of Andrew Kleine, who has served a CAO for the first 20 months of the Elrich Administration. Madaleno will begin serving as acting CAO on Aug. 16.

County Executive Elrich expressed appreciation for Kleine’s many contributions to the County Government. “During his time as CAO, Andrew Kleine led the County Government’s effort to reorganize services ranging from public safety to technology services,” said Elrich. “He championed a Turn the Curve initiative to empower County employees to rethink and improve the delivery of services to our million-plus residents. Over the past five months, he has played a critical role in our community’s response to the coronavirus pandemic. I thank him for his many contributions and wish him well in future endeavors.”

Madaleno, who is serving as the Director of the Office of Management and Budget, is a lifelong Montgomery County resident. He has spent his career serving the people of the County in leadership roles at the County and the State levels and had a long career as an elected representative for Montgomery County in the Maryland General Assembly. He served from 2003-2007 in the Maryland House of Delegates and from 2007 to 2019 as a State Senator representing District 18. While in the Senate, Madaleno was the Vice Chair of the Senate Budget and Taxation Committee where he was known for his ability to find solutions to some of the most challenging budget problems facing the state. He was a leader in education reform serving on the Kirwan Commission. Madaleno also worked in the County’s Office of Intergovernmental Relations from 1995 to 2002.

“Rich is trusted by community groups and policymakers throughout the County and State for his leadership skills and budgeting acumen, which will serve the County well as we face the most significant challenges of our generation,” said Elrich. “I am confident that his experience and expertise will help my administration deliver on my promise to build a healthy, well-functioning, innovative, equitable and inclusive community for all of our residents.”

The County Executive’s CAO nomination must be approved by the Montgomery County Council. Councilmembers are scheduled to return from their summer recess in Sept.

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Top Seventh State Stories, July 2020

By Adam Pagnucco.

These were the top stories on Seventh State in July ranked by page views.

1. Restaurant: My Staff Will Not Wear Face Masks
2. MCEA: MCPS Reopening Plan “Wholly Inadequate” to Protect Students and Staff
3. Volcano in Rockville
4. The Upcounty Doesn’t Vote and Nobody Seems to Care
5. Distance Learning May be Plan C, but it is the Best Option Right Now
6. MoCo’s Book Club
7. Elrich on Hot Mic: “Can I Say the Council is Fact Proof?”
8. MCEA President Responds to MCPS Video
9. Kleine on the Line Again
10. MCPS Releases “Just the Facts” Video

The post about a restaurant not requiring face masks was one of the top five most-read stories in the history of this blog. (That puts some perspective on the relative importance of politics!) Marilyn Balcombe and Sunil Dasgupta deserve congratulations for their excellent and widely read guest posts. Aside from those, the top posts generally reflect the top two stories of the month: MCPS’s reopening decision and the county’s ethics-challenged Chief Administrative Officer Andrew Kleine.

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MoCo Finally Bans Tax Dollars for Kleine’s Book

By Adam Pagnucco.

Roughly a year after the Montgomery County Ethics Commission began receiving complaints about Chief Administrative Officer Andrew Kleine’s promotion of his book, the county has finally banned the use of tax dollars to purchase it.

The ethics commission’s report states that county employees began complaining about Kleine “during the summer of 2019.” The commission requested that the county’s inspector general begin investigating Kleine on September 4, 2019. The inspector general completed the investigation and sent a report to the ethics commission on December 12, 2019. At some point thereafter, Kleine offered a proposal to “cure” the issue which the ethics commission accepted and signed on July 1, 2020.

The ethics commission’s report states that the county bought 89 copies of Kleine’s book from October 1, 2018 through September 30, 2019 for a total of approximately $3,000. It contains no information about book purchases since then.

On July 20, 2020, Deputy Chief Administrative Officer Fariba Kassiri – who reports directly to Kleine – sent out the email below to county managers advising them that county funds cannot be used to purchase Kleine’s book so long as he remains a county employee. The amount of county money spent on the book between September 30, 2019 and July 20, 2020 has not yet been reported.

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From: Kassiri, Fariba Fariba.Kassiri@montgomerycountymd.gov
Sent: Monday, July 20, 2020
To: #MCG.Department & Office Directors MCG.DepartmentOfficeDirectors@montgomerycountymd.gov
Subject: Restricted Book Purchase

Department and Office Directors,

In accordance with the CAO’s Proposal to Cure certain violations of the Ethics Law and the Ethics Commission’s subsequent acceptance of the proposal on July 1, 2020, I am advising you that your Department/Office should not purchase any copies of City On The Line by Andrew Kleine, so long as Andrew remains County employee. This means no purchases can be paid for through the Oracle system, by P-Card or by reimbursing employees for the purchase of this book.

Please share this information with your appropriate staff and let me know if you have any questions or need additional information.

Thank you,

Fariba Kassiri
Deputy Chief Administrative Officer
Montgomery County, Maryland
Offices of the County Executive

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Volcano in Rockville

By Adam Pagnucco.

When the county council met yesterday to consider the case of admitted ethics violator and Chief Administrative Officer (CAO) Andrew Kleine, one word alone can describe what happened: Eruption. Rockville was covered by a black cloud of ash and lava sprayed through the streets as the council held very little back. Montgomery County Government has never seen anything quite like it.

The basics are simple: last year, executive branch county employees (all of whom work under Kleine) complained to the ethics commission about his book marketing and his relationship with contractors with whom he had done private business and then had gone on to help obtain county contracts. After an investigation by the county’s inspector general, Kleine proposed a “cure” which involved the payment of $5,000 and his abstention from outside employment. The ethics commission accepted the cure and the county executive has allowed Kleine to remain as CAO. Seventh State has previously published columns on the issue on July 2, July 7, July 9 and July 27.

Kleine was not present at the council’s meeting, leaving ethics commission chair Rahul Goel and ethics commission staff director Robert Cobb to brief the council on Kleine’s ethics case. Before elaborating on the situation with Kleine, Goel and Cobb suggested a need for mandatory ethics training for all county employees, including elected officials. No one disagreed with that. But the council did not buy that ethics training alone would have prevented Kleine’s actions. What followed was a remarkable and unprecedented display by the council members in which some walked right up to the line of calling for the CAO’s resignation without actually crossing it. Consider these quotes from the briefing.

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Council Member Nancy Navarro

Training is important but how would that have avoided this situation? And it’s one thing for an employee to have done something like this but when it’s the Chief Administrative Officer, that raises for me some concerns because the employees, the county government employees obviously are under the Chief Administrative Officer and it is very difficult with a straight face to say to our employees “you’re going to have to go to mandatory training” when the Chief Administrative Officer himself didn’t seem to understand the basics of ethics and conflicts of interest…

I personally still have some concerns regarding the ability of Mr. Kleine to be the Chief Administrative Officer of our county government when there was such a lapse in judgment regarding something like this.

Council Member Gabe Albornoz

I’m troubled that Mr. Kleine was not put on administrative leave during the course of the investigation and continued in his role as the head of procurement for our entire county through this investigation. I’m concerned that the county executive has not reached out to my colleagues and I to express how his administration has taken this matter extraordinarily seriously, how there has been, I believe, a statement from the county executive but not much more than that in terms of his comments on this particular matter.

Because the ripple effect of a situation like this is profound. What do we say to department heads who are also found guilty of similar violations? That you get one strike? You get a pass the first time around and yes, there is a cure, but the cure for the payment of $5,000 and the retainment of employment is significant in light of what we have seen. And I appreciate those recommendations and I also appreciate the recommendation of additional training.

But the broader question here is trust. And I worked in an executive branch for twelve years and know how important that trust is among colleagues. And I don’t believe enough has been done beyond this cure to repair the damage from the messaging that this sends to all the county government, that this sends to people that deal in their business with county government. And I don’t think quite frankly that this matter has been taken seriously enough by this administration. And that’s a concern.

Council Member Hans Riemer

This whole incident reinforces a concern that I have had about – and I think many people in the county government have had about the chief administrator’s work. The county executive has allowed him to really apply his personal business theory, his personal business practice, “turn the curve,” to his management of the county government. The county executive has required all of our departments to participate in something that really often feels like a demonstration project for a consulting practice. And it often feels like it substitutes jargon for real management initiatives. And that has been weighing on me for a lot of time. And I think that this report just raises some real questions about the continuing of the consulting business and really whether the intended – whether the chief administrator’s success is the county’s success. And I think that that is weighing on a lot of people and department heads and managers. And I think we do have an issue. We need to restore the confidence of this county government in the leadership of the executive branch.

Council Member Craig Rice

At the end of the day, this falls on the county executive. The county executive wants to continue to have the number two person in charge be a person who has committed serious ethics violations, that’s a choice he’s going to have to justify, that’s a choice that he’s going to have to stand up and say this is why he feels as though it’s comfortable to have this person still in charge in a leadership position.

Council Member Andrew Friedson

Public trust is the only currency that we have in public life. It’s all we have in terms of our ability to govern, and to me, this speaks directly to public trust. And it’s why I share many of the comments of colleagues of how disturbed and disappointed I am by the contents of the ethics report because that’s what this speaks to. And it’s not a member of the county government, it is not some county employee, it is the top county employee, the person who is in charge of running the government. And I speak similarly to comments that were made about – the comments about training. This is not a training issue. Let’s not obscure what happened here. This is specifically a clear violation of ethics and of public trust. That’s what it is. It is a massive, massive failure of judgment in the highest position in county government…

When we talk about this as being a cure, it’s kind of a euphemism. What this really is effectively is a plea agreement.

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Volcanic eruptions can be hard to survive due to their pollution of the atmosphere, the danger of lava flows and the potential for subsequent discharges. In this case, the repeat discharge potential is real with multiple council members asking whether Kleine received special treatment (a subject for another time!) and requesting more information. Lava, like water, can drip drip drip.

With the council’s eruption threatening to bury the executive branch in a blanket of burning ash, the big question now is: why has the county executive allowed Kleine to stay? And will that continue?

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Kleine on the Line Again

By Adam Pagnucco.

Nearly a year ago, I wrote a column called “Kleine on the Line” about the county’s embattled Chief Administrative Officer (CAO), Andrew Kleine. Back then, I wrote:

Andrew Kleine is a smart guy with interesting ideas and a lot to offer. But we are now at a big moment. The chief administrative officer is the single most critical non-elected employee of county government. He or she must be beyond reproach and in total alignment with the county executive’s priorities.

The controversy over Kleine’s former business partner and his book sales, as well as the scathing letter from the unions, calls into question whether this is the case with Kleine. [County Executive Marc] Elrich must resolve these issues one way or another or his administration will pay the price.

A year later, Elrich has paid a price in the form of a searing report by the ethics commission and the inspector general detailing how Kleine steered county contracts to his business partners and converted county government into a book club. Now Kleine really is on the line as the county council is due to discuss his ethics problems in an open meeting tomorrow.

The ethics commission report by itself would generate harsh consequences in any other administration. But it is not the only issue with regard to the CAO’s record. Kleine described implementing Elrich’s campaign-era “90 Days Financial To-Do List” as one of his top priorities in November 2018, but numerous promises in that list have gone unfulfilled or under-fulfilled. The list included a ten-year financial plan (not done as of the FY21 budget), a “structural review of all departments in partnership with the county’s unions” (where is it?), an innovation fund (cut back from a $2 million request last year to one $71,545 software project) and a promise to “introduce or strengthen mechanisms that hold county leaders accountable to both other employees and to the public.” That last one reeks with irony.

There is more. Restructuring in cooperation with the unions was a major Elrich campaign promise, but since the unions have put their objections to Kleine in writing, whether this can be completed with Kleine having any part in it remains in doubt. The CAO’s office would normally have a role in approving department head nominees and the nominations of Vennard Wright (technology services) and Tonya Chapman (police department) were both train wrecks due to lack of vetting. The administration’s two-year budgeting initiative, with which Kleine was directly involved, was resisted by the county council and made no appearance in the FY21 budget. And it’s unclear whether Kleine was directly involved with the $10 million “magic asterisk,” the illegal negative appropriation in the executive’s recommended budget intended to account for phantom savings from “cost efficiencies.” But if he did have a role in it, add that to the above list.

The CAO preaches “outcome budgeting” in his book and elsewhere, but given the above record, what has been done that has yielded a positive, documented and significant financial benefit for the county?

Now let’s put all this into context. At the time of Kleine’s arrival in county government towards the end of 2018, two other events were occurring. First, Kleine’s predecessor – 12-year CAO Tim Firestine – was leaving. Unlike Kleine, who had never worked in MoCo government before, Firestine had been with the county for nearly 40 years. Before he was CAO, he was the county’s highly regarded finance director for 15 years. He was well known and well respected in both the executive and legislative branches. Firestine wasn’t warm and cuddly, but no one disputed that he was honest, competent and totally uninterested in self-promotion. He left very big shoes to fill.

The other huge event was the revelation that former economic development official Peter Bang had stolen $7 million from county government. The news was arguably the biggest scandal in county history and shocked people who had worked with Bang, who cultivated a reputation as a sharp dressing, no-nonsense professional. In the aftermath of Bang’s arrest, ethics became an even higher priority in a government that prided itself on avoiding the municipal corruption that so often plagues other jurisdictions in the region.

Into this arena descended Kleine, who immediately set out to direct county contracts to his private business partners and began promoting his book throughout county government and beyond. Bear in mind that 99% of county employees knew little or nothing of Kleine when he arrived. This was the first impression he was making on them. Say what you will about MoCo government, but it is full of professional, experienced and dedicated people – both managers and rank-and-file – who would never think of going anywhere near a conflict of interest. How did they see Kleine’s behavior? We don’t know how all of them saw it, but we do know from the ethics report that employees from two different county departments went to the ethics commission to complain. If these employees are still in county government, they are still working for Kleine even after he admitted to violating two sections of ethics law.

There has been no allegation of criminal activity by Kleine but he is guilty of extremely bad judgment that went on for months. How can he remain in his current role? He is the administrative head of county government. The next time he appears before the county council (in person or virtually), he has to know that all nine of them will be thinking about his ethics violations. The same goes for his own employees. Is there a senior manager anywhere in county government who has not read the ethics report? How can Kleine command the respect and good will any CAO needs to run the government?

The other question here is: where was Elrich? In the spring of 2019, rumors were everywhere about Kleine’s book promotion and his contractors. Was Elrich completely unaware of what was happening or was he aware and saw nothing wrong with it? Neither scenario is appealing. Kleine is the most senior non-elected person in the administration and reports to only one person – Elrich. If Kleine remains CAO after a slap on the wrist, it’s an open question as to whether Elrich is capable of firing anyone – or even disciplining them – for misconduct. What impact will that have on the culture of the executive branch?

That brings us to the county council, which is due to discuss Kleine at an open meeting tomorrow. The council can’t discipline Kleine directly – that is the prerogative of Elrich alone. But the council’s views on Kleine relate to a major theme of this term: the council’s lack of respect for the Elrich administration. The council has voted down Elrich’s labor agreements, rejected his approach to fixing the county’s balky public safety communications system, rejected his tax hike proposal (on the very day he offered it), rewritten his second budget, rejected his first nominee for police chief, passed its own set of health regulations in protest of his performance on COVID testing and regularly ignores his input on legislation. Then came Elrich’s hot mic joke that the council is allegedly “fact proof,” which drew harsh responses from Council Members Nancy Navarro and Gabe Albornoz. It’s hard to imagine the council having an even worse opinion of the administration, but if it comes to believe that Elrich tolerates unethical conduct, his influence will dwindle to zero. That’s obviously bad for Elrich. It’s also not so great for the daily function of county government.

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MoCo’s Book Club

By Adam Pagnucco.

You might think of Montgomery County Government as an entity that finances schools, deploys police and fire fighters, maintains roads, administers social services, operates libraries and more. Yes, it is all of those things. But under the Elrich administration, it became one more thing:

A book club.

Imagine that you write a book. You think it’s a great book. It’s all about how to run a local government. And then you get a dream job actually running a local government. And it’s not just any local government – it’s a very prestigious one, with more than 8,000 employees who will now be working for you. You think this government is doing OK, but it could do a lot better if it was run in accordance with what your book says. So what are you going to do?

Encourage as many of your employees to read that book as possible.

That is one of the biggest themes pervading the bombshell report written by the ethics commission and the inspector general (IG) about Chief Administrative Officer (CAO) Andrew Kleine, the top manager in county government. Ethics complaints made by county employees last year resulted in Kleine admitting to breaking two provisions of county ethics law over issues related to his book, City on the Line, and his participation in getting two of his private business partners county contracts.

Kleine is not the star of the report. His book is. Over and over, it’s about the book.

The IG noted many details about the promotion of Kleine’s book inside county government. Consider the following excerpts from the report.

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Multiple County employees reported to the IG that Mr. Kleine often spoke about his book to County employees and that they felt they needed to read it. OMB [the Office of Management and Budget] referred to City on the Line in its budget training sessions, after which County employees from various departments emailed that they needed a copy.

On December 10, 2018, Mr. Kleine retweeted a tweet from the program director of the political science program at UMBC at Shady Grove that stated, “#MoCo agency bosses are reading/having staff read incoming Chief Administrative Officer’s @awkleine’s book City on the Line. You should too. Available at Amazon for $35 http://a.co./d/hf7xUtV @UMBCpolisci @MarcElrich”

On December 18, 2018, a County Department Director emailed that City on the Line was “assigned to him as mandatory reading.” The CAO supervises County department directors and would be the person who could require certain work assignments from Department Directors.

On April 29, 2019, the Director of OMB emailed staff, “To help the office plan for outcome budgeting and the Turn the Curve initiative, we have five copies of the books City on the Line and Trying Hard is Not Good Enough. Please see me or Darlene if you want to borrow one. I also have coupons if you want to purchase your own copy of City.”

On June 6, 2019, an OMB employee emailed a telework plan that included reading City on the Line.

On July 1, 2019, the Director of OMB emailed his staff a compilation of takeaways from City on the Line.

On August 6, 2019, an OMB employee asked an OMB staff member and a Recreation Department budget specialist to draft a presentation for the Training Implementation Workgroup. “You can use City on the Line, Chapter 3… as a reference.”

A speaker note on the OMB & Training Implementation Workgroup September 2019 presentation, “Outcome Based Budgeting FY21 Operating Budget” stated that, “We can use the example – from City on the Line Pg 58/59.”

On August 14, 2019, an OMB employee emailed other staff, “As a suggestion, it may be advantageous to read the following materials to gain a better understanding of Outcome Based Budgeting and Turn the Curve thinking: City on the Line and Trying Hard is Not Good Enough.”

On August 19, 2019, a Recreation Department emailed, “Could you please order me a copy of City on the Line… we are discussing it in our work sessions and I am the only person in the group who does not have a copy. Plus we are receiving work assignments related to the information in the book.”

On August 19, 2019, a Department of Permitting Services employee emailed a request for City on the Line via 2-day shipping from Amazon and wrote, “I normally wouldn’t pay this, but we need this book to reference for outcome budgeting, which is a new way of budgeting this year.”

On August 23, 2019, a Department of Police employee emailed, “In the budget meetings I am going to they keep referring to a book ‘City on the Line.’”

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And so the book was integrated into the operations of county government. Employees were being encouraged to read it and some felt left in the dark if they didn’t. That means books had to be acquired and someone had to pay for them. According to the report, the county spent approximately $3,000 to buy 89 copies of Kleine’s book. Kleine earned total royalties from all purchases of $3,157 on the book through the end of 2018. Royalties paid in 2019 and 2020 are not mentioned in the IG report.

Even this guy thinks all this book stuff is getting out of hand.

Kleine also promoted the book at events outside the county government while on work time. The screen shot below from the IG’s report details how 80 hours of Kleine’s official work time – charged to taxpayers – included book promotion.

Did Kleine’s activities create an appearance of improper influence? Here is what the IG’s report had to say about that:

Redactions like the ones above are made to protect witnesses. Because Kleine is still the CAO, these witnesses presumably remain Kleine’s subordinates if they are still employed by the county.

What should we make of all this?

Throughout the report, Kleine comes across as a man who wants to be a celebrity, a public management guru, who preaches things like “Turn the Curve” to build his brand, sell books, make speeches and get consultant contracts. There’s nothing inherently wrong with that but that’s not why taxpayers are paying him $280,000 a year. We need a nuts-and-bolts operations manager in this role, someone who makes the trains run on time and works on behalf of the taxpayers with no other agenda at play.

It’s incredible that this needs to be said, but the CAO should be running county government, not converting it into a royalty-generating book club.

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Council Puts Elrich on the Spot Over Kleine

By Adam Pagnucco.

The Montgomery County Council has issued the statement below about Chief Administrative Officer (CAO) Andrew Kleine. Kleine, who is the highest ranking manager in county government and is answerable only to County Executive Marc Elrich, has admitted to two ethics violations related to promoting his book and helping two of his business partners get county contracts. The council says that it is “disappointed and troubled by the actions” of Kleine and intends to hold an “oversight meeting” on the matter. That said, only Elrich can decide what happens to Kleine.

The council’s statement appears below.

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Montgomery County Council statement on July 1 Ethics Commission agreement with Chief Administrative Officer Kleine

ROCKVILLE, Md., July 7, 2020–Council President Sidney Katz made the following statement on behalf of the Montgomery County Council about the July 1 Ethics Commission agreement with Chief Administrative Officer Andrew Kleine.

Our system of representative government depends on the people maintaining the highest trust in their elected officials and government employees. All Montgomery County residents expect and deserve public employees who are impartial and use independent and sound judgment when making decisions that impact more than one million community members.

The Council is disappointed and troubled by the actions of Chief Administrative Officer Kleine. We greatly appreciate the Montgomery County Ethics Commission and the Office of the Inspector General for investigating Mr. Kleine’s actions and bringing these issues to light. Montgomery County’s ethics law applies to all County government employees and elected officials and has standards in place to guard against conflicts of interest and improper influence and includes comprehensive ethical standards for conducting County business.

The Montgomery County Charter provides that Mr. Kleine serves at the pleasure of County Executive Elrich. As one of the highest-ranking employees in Montgomery County, Mr. Kleine has a heightened responsibility to instill trust among the public, employees and government leaders. While we acknowledge that Mr. Kleine has taken responsibility for his actions, we also encourage him to do everything in his power to work on rebuilding the community’s trust. Moreover, the Council will conduct an oversight meeting on this matter in July.

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County’s Top Manager Admits Violating Ethics Law

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.

Balancing Act

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.

Book Promotion

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.

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