West Virginia Attorney General Darrell McGraw speaks Tuesday at the opening of a satellite office in Martinsburg, W.Va.
MARTINSBURG, W.Va. (Legal Newsline) - It took a $25 billion national settlement and not an act of the state legislature to finally give West Virginia Attorney General Darrell McGraw an office in the state's fastest-growing region.
Tuesday, McGraw christened a satellite office in Martinsburg, a city in the Eastern Panhandle located more than 300 miles from Charleston. By comparison, Martinsburg is less than 100 miles from both Washington, D.C., and Baltimore.
The office is funded for three years by a recent national settlement with five mortgage servicers worth $25 million. McGraw said at least $33.8 million will be available to West Virginia, and he has also set up workshops around the state to inform residents of the options provided them by the settlement.
"We hope the office will work efficiently and effectively, and we'll be able to keep it open," said Jill Miles, who heads McGraw's Consumer Protection Division. "These people felt isolated from the rest of the state."
The grand opening comes six months before McGraw might have to endure another close re-election effort. This time, he's facing an Eastern Panhandle resident in Republican Patrick Morrisey, an attorney who works in D.C. and lives in Harpers Ferry.
"No one objects to the opening of an office in the Eastern Panhandle, but McGraw has done it by co-opting the power of the Legislature to appropriate funds," Morrisey said Tuesday.
"The last time I checked the West Virginia Constitution, the Legislature possesses the power of the purse. McGraw seems oblivious to that fact."
McGraw also attempted to open an office in the Eastern Panhandle office in 2007, but the Legislature would not give him the funds he requested.
"We've wanted to do this, really, for a long time," McGraw said. "Like any issue in government, there's going to be some controversy, some resistance. But we expect that. It's part of our business."
West Virginia Citizens Against Lawsuit Abuse, a legal reform group often critical of McGraw, says the move is questionable from many perspectives.
"Even though the Legislature is supposed to have the 'power of the purse' to control state spending, McGraw has unilaterally decided, in an election year nonetheless, to use state lawsuit settlement funds to open a satellite office without legislative approval," said Richie Heath, CALA's executive director.
"These funds generally are intended to be for the benefit of West Virginia consumers and not, as it appears in this instance, to build McGraw's name-recognition in an election year."
McGraw has been the state's attorney general for 20 years, though his last two re-election wins each came by less than 1 percent of the vote.
In 2008's race against Dan Greear, McGraw took Jefferson County by more than 2,000 votes. That figure could change this year given that Jefferson County is where Morrisey calls home.
A swing in that county could be harmful to McGraw, who won the 2008 statewide race by 5,302 votes.
"When I went to school at West Virginia University -- where I got two degrees in political science -- I had a professor who taught us there that all acts of government are political," McGraw said.
McGraw was criticized for how he handled a 2004 settlement with a prescription drug maker worth $10 million. Rather than give the recovery to the state Legislature, the settlement allowed him to spend it as he saw fit. It was mostly used for day report centers for non-violent criminals, and $500,000 went to the University of Charleston for a pharmacy school.
Ultimately, the federal government successfully argued that it was owed millions from the settlement, causing a withhold in Medicaid funds appropriated to West Virginia from the feds.
Morrisey said the Legislature would not allocate funds to McGraw for the Martinsburg office in the past because McGraw has consistently abused the power of his office.
"Certainly, the Eastern Panhandle deserves representation, as do all parts of the state," Morrisey said. "An office in the Eastern Panhandle is a good idea. But you shouldn't be funding it through your own personal taxpayer-funded campaign kitty. That's what McGraw has done."
As for the day-to-day operations of the office, Miles said it will help the many Eastern Panhandle residents eligible for some measure of relief.
The office previously said there will be an immediate estimated payment of $2,000 for each state homeowner who lost their home to foreclosure between Jan. 1, 2008, and Dec. 31, 2011. Chief Deputy AG Fran Hughes later said those residents might even see more than $2,000 each.
More than $18 million will go to loan modifications and benefits to state homeowners currently in default or foreclosure, more than $5 million will go to free refinancing for "underwater" but current state homeowners and another $6 million will go to foreclosure and mortgage assistance and prevention programs in the state.
Two other areas of concern in the Eastern Panhandle are payday lending and title pawning, Miles said, because the area is so close to states in which those practices are legal.
From Legal Newsline: Reach John O'Brien by e-mail at email@example.com.