An upset Gov. William Donald Schaefer defended how the Maryland State Lottery Agency awarded a $65 million computer contract but said he would appoint an "outside individual" this week to review the bidding process.
The governor assailed newspaper reports and an editorial that he said carried misleading "innuendoes" that some subcontractors to the firm that won the lottery contract -- including a man who has said he once ran an illegal numbers operation in Baltimore -- stand to benefit because they are his friends.
"There has been no scandal. There is no scandal now," Schaefer said in Annapolis minutes before the start of the weekly state Board of Public Works meeting.
The Board of Public Works awarded the five-year lottery contract April 17. The contract covers all the hardware, software, services and maintenance for the Maryland State Lottery Agency's machines.
The bid from GTECH Corp., the Rhode Island company that won the contract to provide new master computers and sales terminals for the lottery agency, was about $17 million less than that of the lottery's current computer company, Control Data Corp. of Minneapolis.
Newspapers in Baltimore and in Washington reported over the weekend that GTECH and lobbyists Bruce C. Bereano and former Gov. Marvin Mandel influenced the bidding by assembling a group of subcontractors that would be favored by Schaefer and Charles L. Benton, the governor's chief fiscal analyst.
Among the subcontractors is William L. "Little Willie" Adams, a Schaefer supporter who was prosecuted in the early 1950s for running an illegal numbers racket in Baltimore. Under the contract agreements, Adams is listed as treasurer of a printing firm that will handle about $1.2 million a year of the lottery agency's printing needs.
According to published reports, other subcontractors include Beverly A. Wyatt, wife of Maurice R. Wyatt, who served as Mandel's patronage chief; Otis Warren Jr., a leading Baltimore real estate businessman and Schaefer fund-raiser; and Jim McLean, husband of Baltimore council member Jacqueline F. McLean.
Yesterday Schaefer implied that unsuccessful contract bidders had given reporters misleading and slanted accounts of the contract process.
"This is big business and the loser can take any tactic he wants," the governor said.
Schaefer did not divulge specifically whom he will ask to look into the bidding process, but said he expects the review to exonerate the lottery agency's actions.
"I can assure you as far as I am able to ascertain," he said, "there is nothing wrong with the process."