Hogan padding his own nest

What kind of hubris does it take to do this and why has it gone on for so long with no national reporting on it

'Serious conflict of interest': GOP Senate candidate funneled millions to his firm as governor (msn.com)
On Thursday, TIME Magazine reported that Larry Hogan — the former two-term Republican governor of Maryland now running for Senate — helped steer almost 40% of all affordable housing contracts to clients of the company he refused to divest from during his eight-year tenure. The ex-governor's firm, HOGAN, which TIME described as a "multi-purpose real estate brokerage firm based in Annapolis," had no such success during his predecessor's time in office. In its report, TIME noted that HOGAN clients were awarded 0% and 30% of affordable housing contracts in the Old Line State in 2011 and 2012, respectively. But after he took office, his company became much more successful at winning development deals. In 2020, for example, HOGAN's clientele got $40 million in state funds and federal tax credits on 18 different projects.

As governor, Hogan sat on the three-member Board of Public Works, which votes on awarding development contracts. The Maryland Republican personally voted in favor of awards between $600,000 and $1.8 million worth of contracts to four different HOGAN clients during his first three years in office. And as Maryland's governor, Hogan signed off on transportation infrastructure projects that were a short distance away from his company's properties in Brandywine and Hyattsville, making them more valuable as a result.

HOGAN's success in securing affordable housing contracts for its clients may have translated to a lucrative payday for Hogan, dwarfing his $165,000 to $180,000 annual salary as governor. Financial disclosure forms filed ahead of his second gubernatorial campaign showed that he made $2.4 million during his first term — notably the first time in Maryland history a governor made millions of dollars. TIME pointed out that in a recent financial disclosure form as a senate candidate, Hogan's net worth ranged from $12.3 million to $35 million.

When he was elected governor, Hogan didn't put his wealth in a blind trust, but rather put his brother in charge of the company and had multiple meetings with both his brother and company trustees during his first three years in the governor's mansion. According to former George W. Bush administration ethics official Richard Painter, Hogan committed "a serious conflict of interest" by participating in the contract award process without fully divesting from his firm.

 

Exclusive: Hogan Approved Millions for Stepmother’s Property Development as Governor (msn.com)

On January 27, 2021, then Gov. Larry Hogan announced some good news for affordable housing in Maryland: nearly $40 million in competitive awards to spur construction of 18 low-income housing projects. “During our administration,” Hogan said, “The State of Maryland has provided financing and tax credits to create or preserve more than 20,000 affordable rental units across the state—an unprecedented level of production." But there was one detail Hogan didn’t mention: one of the projects was being developed on his own family’s property.

The bucolic land in Frederick County, roughly 50 miles north of Washington, D.C., had been in the Hogan family since the governor’s father, former Congressman Larry Hogan, Sr., and his second wife, Ilona Hogan, bought it in 1983 for $230,000. Now, three years after Hogan Sr. had passed away and six years into his son’s tenure as governor, Hogan's stepmother was converting the ten-acre property into an income-restricted housing facility. Ilona Hogan had transferred the property into a limited liability company (LLC) she owned, according to land records reviewed by TIME. Osprey Development, a listed client of Hogan’s real estate brokerage firm, HOGAN, had been engaged to helm the project. The $15 million in low-income housing tax credits over ten years and $1,035,000 in state funds that Hogan announced that day made Crestwood Manor, as the 60-unit affordable housing complex would become known, a reality. It also paved the way for the ultimate sale of the property. In November 2022, Ilona Hogan sold it to Osprey for $3.75 million.
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The Crestwood Manor project is the latest example of a potential conflict of interest between Hogan’s authority over Maryland housing dollars as governor and his family’s real estate businesses. Maryland law says that officials cannot knowingly participate in decisions in which they or a close relative have an interest. "Approving transactions which benefit you personally or your family or your affiliated interests is, I would say, at a minimum, unethical," says Warren Deschenaux, former director of Maryland’s nonpartisan Department of Legislative Services. "The governor is responsible for what happens under him."

TIME tried to contact Ilona Hogan for comment through Manchester Partners LLC, HOGAN, and former Governor Hogan, but she couldn’t be reached. Responding to questions from TIME, a Hogan spokesman, Michael Ricci, says the former governor had nothing to do with selecting the Crestwood Manor project. “Governor Hogan and his office played no role in the evaluation or selection process for these merit-based awards,” Ricci says. “All decisions are made by agency officials on a competitive basis as part of a rigorous application process held by the Department of Housing and Community Development (DHCD). These safeguards prevent any personal or political considerations from entering the process.”