The dismissed director of the Maryland State Games used state and federal grants to finance a trip to Germany, rent Ocean City condominiums, write checks to himself and set up a fencing academy that immediately hired his wife, legislative auditors have determined.
In a report released yesterday, the auditors accused James E. Narron of a litany of "questionable, extravagant and unsubstantiated expenditures."
They said Mr. Narron used government funds to try to launch a sports clothing business. They found that he continued to pay state salaries to a man in jail and to another worker -- Mr. Narron's brother-in-law -- who was enrolled at a state university at the time.
They said Mr. Narron appears to have used federal alcohol- and drug-abuse prevention funds for a variety of improper activities, including parties where liquor was served. And they concluded that relatives of John Staubitz, a deputy health secretary who was dismissed last week along with Mr. Narron, directly benefited from Mr. Narron's spending.
The audit, which is sharply critical of Mr. Narron's superiors at the state Department of Health and Mental Hygiene, was launched in September after legislative investigators learned that the state agency had awarded more than $400,000 in grants to a private foundation headed by Mr. Narron.
Mr. Narron created Maryland State Games Foundation Inc. in 1985 to raise money to pay for an annual amateur athletics competition called the Maryland State Games. The health department decided in 1987 to make Mr. Narron a state employee, and diverted money from other programs to create a state office from which he was to promote amateur athletic activities.
Even though it then had a state office for that purpose, the health department awarded during the past two years more than $400,000 in funds to Mr. Narron's private foundation -- a funding arrangement that allowed Mr. Narron to spend the money without scrutiny. The auditors noted that he was the only person who could write checks from the foundation's account.
The auditors looked at the finances of the state program and the foundation -- each was headquar tered in the same office at Springfield State Hospital -- and found problems with both.
They said that in his state capacity, Mr. Narron continued to pay a salary to an employee who spent 11 workdays incarcerated in the Baltimore City Jail. Sources have identified the worker as Bryant M. McGuirk, a son of Harry J. McGuirk, who is an aide to Gov. William Donald Schaefer and a former state senator. The report does not say why Bryant McGuirk was in jail.
They also found that from January through May of this year, Mr. Narron's brother-in-law, Christopher Hillman, was paid for working on days that he was registered for classes at an unnamed state university. The report quotes Mr. Narron as saying that Mr. Hillman worked at night to make up for those hours.
In looking at the foundation's financial records, the auditors questioned several payments made with private funds to relatives of then-Deputy Health Secretary Staubitz. They said the foundation spent roughly $53,000 this year to buy two new cars and a new sport van from Mr. Staubitz's father, who is a salesman at a local dealership. The auditors did not challenge the price paid for the vehicles, but said no records could be found to show why they were needed or how they were used.
A review by The Sun of state Motor Vehicle Administration records show that only two of those vehicles are registered in the foundation's name. It could not be determined to whom the third vehicle is registered.
The foundation also spent roughly $3,000 on a scholarship for a niece of Mr. Staubitz. Mr. Narron said the scholarship was a reward to her for volunteer work, according to the audit.
The report also noted that while the foundation's books show it received roughly $90,000 in fees paid by athletes competing in the State Games, it does not have records proving that all of those fees were deposited. The foundation similarly cannot prove that state workers who were sent to Ocean City to sell souvenirs in fact turned in the money they received.
Responding to the audit's findings, state Health Secretary Adele A. Wilzack said last night that she was "very hurt and angry" that top employees had apparently abused her trust. But she defended her decision to award state grants to Mr. Narron's foundation, since it had always operated the State Games.
"It existed, and it seemed to be an appropriate group to carry it out," she said.
Ms. Wilzack said she had not been aware of the extravagant spending, the hiring of relatives and other problems cited in the audit report, but said she accepted responsibility for them.
"I am troubled for my department and the citizens of Maryland. I have to take responsibility for what happened here," she said.