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Panel seeks study on shifting Maryland PTV to nonprofit
While auditor says agency bent state contracting rules

Originally published in Current, Dec. 15, 2003
By Karen Everhart

A state panel that proposed privatizing Maryland Public Television took half a step back, advising Republican Gov. Robert Ehrlich to hire an independent firm to study the idea.

The Mandel Commission, which looked for streamlining opportunities across the state government, presented its final report to Ehrlich Dec. 8 [2003]. Its recommendations on MPT were among only a few that commissioners changed from a draft report issued in November.

The decision to explore a license transfer now rests with the governor, who has not commented on the recommendation. “He plans to review the report and go forward from there,” said Henry Fawell, press secretary.

The commission’s move to depoliticize the proposed license transfer took some heat off MPT, which also came under fire this month for bending state rules in awarding contracts. It was not clear whether the audit results would have any effect on the privatization question.

But the scrutiny of MPT’s internal controls highlighted a key finding of the Mandel Commission: Though the state provides less than 30 percent of MPT’s operating budget, it imposes “needlessly cumbersome” operating procedures that add to costs.

Former Maryland Gov. Marvin Mandel chaired the 25-member commission, officially dubbed the Governor’s Commission on Structure and Efficiency of State Govern-ment. Ehrlich established the commission in August and gave it a fast-track mandate to evaluate ways to cut costs and streamline the state government.

Its preliminary report recommended transferring MPT’s license to a nonprofit entity, such as the network’s fundraising arm, the Maryland Public Broadcasting Foundation. But Louise Hayman, the commissioner who drafted the MPT recommendations, decided in the last month to revise the proposal. “I was convinced by MPT that they needed more than just the average state look-into-something,” she explained, and “that professionals within the broadcasting industry and familiar with public broadcasting should look into it.”

The commission’s other recommendations, unchanged from the draft report, were to:

One prominent MPT supporter endorsed the proposed license transfer. Zelig Robinson, a Baltimore attorney and former chairman of the Maryland Public Broadcasting Commission, said that MPT’s state funding has declined from nearly 90 percent of its budget in the late 1980s to 30 percent today. As member contributions, underwriting and foundation support broadened support for MPT, he came to believe that other constituencies ought to be represented in its governance.

“It made sense for the license to be transferred to a nonprofit,” Robinson added. “I frankly thought that, in the long run, the system could better serve the constituencies that supported it with that structure and governance.”

Inside a contracting issue

While the state has given MPT some flexibility to hire television talent and creative artists outside state procurement rules, auditors for the General Assembly’s Office of Legislative Services released a report Dec. 2 criticizing MPT for using its exemption to award $2.2 million contracts for web production services.

The auditors found a conflict of interest in a $54,000 contract awarded to a web producer who is the longtime boyfriend of MPT's former v.p. for interactive. Auditors deemed the contract improper because it was not awarded through competitive bidding and the couple lived together. Auditors shared their findings with the Federal Bureau of Investigation, said Jerry Mertz, director of fiscal compliance for Maryland’s Department of Legislative Services.

The Baltimore Sun reported in September that the contract was under investigation, but neither Beverly Bricker, the web chief who supervised the contract, nor Bean Creative, the web design firm that subcontracted to Bricker’s boyfriend, have been contacted by investigators. A spokesman in the Baltimore FBI office would not comment on whether the bureau was involved.

Although the findings came out of a routine audit of MPT for the state legislature, the findings prompted a Dec. 3 hearing before the General Assembly’s audit committee. A legislative policy analyst said that the joint House-Senate committee holds hearings for audits that turn up "more egregious findings."

Auditors and MPT President Robert Shuman appeared before the committee and responded to lawmakers’ questions, according to several sources. After such hearings, auditors typically follow up through an exchange of letters, explained the policy analyst, and continuing problems can result in conflict at budget time.

MPT wants to avoid such an outcome. “We agreed with the bulk of the recommendations and that we would be making changes to bring [MPT internal controls] into compliance,” said Larry Unger, executive v.p. The network’s own auditor has developed a new policy for awarding contracts, and the Maryland Public Broadcasting Commission, MPT’s license holder, will review it next month.

MPT also agreed to follow state procurement rules in contracts for web production, rather than using the television artists’ exemption that gave them flexibility to hire talent quickly, he said.

Contractual issues raised by the auditors were “not terribly different” from what other state-funded networks must deal with, Unger said. “State contracting in general is not set up for broadcasting. It’s set up for road construction.”
Of the spending that auditors questioned, “not a nickel was lost or misdirected,” Unger said. “All the services were delivered in a timely manner.”

Hiring “to get things done”

The innuendo over web contracting troubled Bricker, whose job at MPT was her first in the public sector. Questions about the contract came up after she left the network early this year.

Bricker recalled consulting with execs at MPT and Bean Creative about hiring her boyfriend after the producer who had been slated for the job didn’t work out.

“There was not anything we were trying to hide,” she said. “I followed what I understood to be standard operating practice to get things done.”

Marc Montefusco, with whom she has lived and often worked professionally for 15 years, is a “veteran multimedia producer” who produced the CPB-funded site Plastic Fork Diaries as a subcontractor to Bean Creative. “It’s not like I was just putting people I knew on the project,” she said. “These are award-winning people in my circle of professionals that I look to on these types of projects.”

“Probably the most important thing that this whole issue has driven home for me is that a lot of people don’t understand the importance of working with people you know are competent,” said Layla Masri, project director at Bean Creative. To her, she said, “there was nothing to take issue with.”

She runs Bean Creative with her husband, and said web workers tend to hire people they’ve worked with before.
“What’s disappointing for us is that a site that really succeeded by everyone’s standards — ours, MPT’s, CPB’s — the accolades have been drowned by questions about who worked on it,” Masri added.

Web page posted Jan. 9, 2004
Current: the newspaper about public TV and radio
in the United States
Current Publishing Committee, Takoma Park, Md.

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OUTSIDE LINKS

Final report of the Governor's Commission on the Structure and Efficiency of State Government (see page 115 of PDF file). Executive order creating the commission. Commission membership.

Maryland Public Television.

Contracting issues arose around MPT's website Plastic Fork Diaries.

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