MD could have identified fraudulent lead inspections sooner, auditors say

A legislative audit released Thursday said deficiencies in Maryland’s inspection program for lead paint in rental homes made it easier for a string of fraudulent inspections to go undetected for several years.

The Maryland Department of the Environment fired back, arguing that auditors asked for closer scrutiny on inspections than the law currently requires. They noted that agency officials were the ones to identify the problematic inspector ultimately held responsible for about 1,500 falsified inspections.

But auditors said the problem could have been caught sooner if the state had more robust procedures to scrutinize inspections. The state later discovered that some children living in homes that were not properly inspected had elevated lead levels in their blood.

The audit of MDE also found delays and backlogs associated with other types of environmental inspections, on polluting facilities and medical X-ray machines. Several audit findings also focused on questionable spending decisions made by “senior management employees,” which auditors evaluated following a whistleblower complaint.

Auditors pointed to a poorly justified decision to give a senior executive’s assistant a 14% raise, and a decision to pay a $25,000 membership fee to a California-based nonprofit that named Environment Secretary Serena McIlwain to its advisory board.

They also highlighted a possible violation of state ethics law, because an agency employee was overseeing a contract with a state university where they also worked — alongside the very same researcher performing the job. That matter was referred to the Maryland State Ethics Commission.

While auditors found shortfalls with MDE spending procedures, they did not deem any of the behavior criminal — and did not make any referrals to the attorney general’s office as a result of their findings.

It’s the second damaging audit for MDE in a year. In July, auditors took issue with the lease deal signed for the agency’s headquarters, at a converted warehouse in Baltimore. The state signed an abnormally long 20-year lease, with cost escalations each year, in order to pay for $10 million of renovations to the privately held building — for new cubicles, solar panels and an updated office suite for the secretary.

State payments, oversight draw auditor’s attention

Auditors raised questions about a $25,000 payment to Veloz, a California nonprofit that engages in nationwide advocacy for electric vehicles — a nonprofit that named McIlwain to its public policy advisory board in 2023.

The February 2025 payment was to be a supporting member of Veloz. But MDE employees could not show auditors any documentation that showed the department analyzed benefits of the membership before sending the money. The audit does not name Veloz, but an invoice obtained by Maryland Matters show the MDE made a $25,000 payment to Veloz in February 2025, matching the audit’s description.

“The lack of this documentation combined with the management employee serving on the public policy board for the organization … raises concerns about the propriety of the payment,” auditors wrote.

Auditors were told the payment was for Maryland to be included in a national marketing campaign to promote the use of electric vehicles. But auditors noted that that “was not consistent with the invoice, which indicated the payment was to become a supporting member of the organization.”

In a written response to auditors, the agency argued that there is no set policy for memberships, but that it had developed a form for staffers to use in order to assess the benefits of joining, rejoining or exiting an organization.

Auditors also flagged a potential violation of state ethics law at the department, involving a management employee who oversaw a memorandum of understanding with a state university, valued at $189,600, while also working at that same university, as a research partner to the university employee performing the work.

Maryland ethics law bars state employees from having secondary employment that would impair their impartiality. Before the contract was signed in early 2023, state ethics officials warned that the MDE employee could not participate in matters involving coworkers at the university.

“Senior management personnel at the Commission advised us that the management employee’s secondary employment and participation in this MOU could potentially violate certain provisions of State ethics law,” auditors wrote.

State officials argued that they immediately conducted an internal review upon learning of the arrangement, and submitted an expedited request to the State Ethics Commission, seeking ethical guidance. The state also noted, in response to the audit findings, that the employee served in a “junior, non-decision-making capacity” when the MOU was approved.

Lead paint woes continue

During the audit, investigators found that the environmental agency had no “documented process to independently verify the lead-free inspections, even on a test basis.”

The agency does not require lead inspectors, who are chosen by individual property owners — not the department — to submit evidence along with their inspection results, only to retain that documentation for review upon request.

That lack of documentation made it difficult for MDE to quickly detect that one inspector, Rodney Barkley of Green Environmental LLC, had been falsifying reports from January 2017 to April 2024, auditors found. And after MDE discovered the investigators’ behavior, it did not notify property owners and tenants very expeditiously, according to the audit.

In response to the audit, MDE said that while it appreciates the recommendations “to review policies that could enhance its ability to verify third-party data, MDE currently operates in full alignment with existing statutes and regulations,” and received a positive review from the Environmental Protection Agency in fiscal 2025, which called its lead inspection program “one of the most robust in the country.”

MDE also stated that it “maintains multiple oversight mechanisms” to review inspectors’ performance, including random biweekly audits of inspection activity, and audits conducted when inspectors’ accreditation is renewed every two years.

Though MDE suspended the errant inspector’s license in April 2024, and referred the matter to the attorney general’s office, “virtually all” of the relevant property owners and renters didn’t receive a notification about the issue until February 2025, according to the audit.

The inspector ultimately pleaded guilty to falsifying the inspections in October 2025. In February he was sentenced to five years in prison, all suspended, and two years of supervised probation.

Last July, MDE notified all of the property owners that their homes would need to be reinspected by a state-accredited inspector within 30 days. But the agency didn’t ensure that those inspections took place. By December, only 299 of the roughly 1,500 properties had been reinspected.

That July 2025 notification also suggested that children be tested for elevated lead levels, but auditors found that MDE “did not attempt to follow up with the tenants to ensure they received the letter, or to help ensure children residing in these properties obtained the recommended lead blood-level test.”

“This is significant, because … children residing in these properties tested positive for high lead levels,” read the audit.

Delayed pollution and radiation inspections persist

In 2022, amid concerns about environmental permitting delays during Gov. Larry Hogan’s (R) administration, the Maryland General Assembly passed a law requiring the environmental agency to clear a permit backlog for polluting facilities, by issuing renewed permits to each facility by December 2026.

As of April 2025, the department still had a backlog of 120 permit applications from Maryland facilities that release polluted wastewater into the environment. While the applications sit in the queue, the facilities’ permits are “administratively continued,” and they are allowed to continue operating as normal. Environmentalists have nicknamed them “zombie permits.”

Of the 120 backlogged permits, more than half had been administratively continued for more than one year, and about 16% had been administratively continued for more than three years — and some up to nine years.

MDE argues that it “inherited a significant backlog” from Hogan’s administration, and that it is still on schedule to clear the queue by December. In the meantime, all of the facilities with so-called zombie permits are in compliance according to their monthly reports to the environmental agency, MDE said.

As of last April, the state environmental agency was also lagging behind on inspections of polluting facilities, according to the audit. Auditors found that inspections for 224 facilities were at least  seven months overdue. Some 39% of those inspections were five years overdue.

The department argued that it is on pace to eliminate inspection backlogs by the end of 2026 as well, and that since fiscal 2023, the department has increased inspections by 38% and filled key vacancies.

MDE is also in charge of inspecting radiation machines, such as X-ray machines in hospitals, dental offices and veterinary practices, and those inspections are backlogged as well, auditors argue. Auditors found more than 1,300 machines, mostly at dental offices, that were overdue for an inspection by seven months to four years.

“The lack of timely inspection could result in unnecessary radiation exposure for facility employees and patients,” auditors wrote.

Christine Condon reports for Maryland Matters.