Purchasing study finds no fraud

January 15, 1994|By John W. Frece | John W. Frece,Staff Writer

General Assembly leaders completed a four-month review of state purchasing practices yesterday by concluding there is nothing wrong with Maryland's procurement law that cannot be fixed with some modest revisions.

"I don't believe there were any serious surprises," said Sen. John A. Cade, an Anne Arundel County Republican who chaired a joint Senate-House task force that reviewed a series of controversial state contracts awarded over the last several years.

What they found, Mr. Cade said, was that the 1981 law governing how the state solicits and evaluates bids, then awards contracts is showing signs of age.

Enforcement has been given second-rate status by many executive agencies; aggressive lobbyists have found ways to poke loopholes in the law; and no one, it seems, is keeping track of what the state as a whole is buying or monitoring how well it's following the law.

"All administrative procedures get a little loose over time, and need to be tightened up," Mr. Cade said. "But we didn't find any fraud, waste or abuse -- no blatant violations of the law."

Senate President Thomas V. Mike Miller Jr., a Prince George's County Democrat who set up the task force last August, said the panel found no evidence of criminal wrongdoing.

"But, we were certainly made aware of favoritism," Mr. Miller said, though he offered no examples.

From the outset, Schaefer administration officials defended their record, predicting the task force would uncover nothing illegal. Some complained the exercise was a charade designed to embarrass the governor and make the General Assembly look good in an election year.

Yesterday, Paul E. Schurick, the governor's chief of staff, said, "The task force came up with a number of solutions, but I believe it is still searching for the problems.

"I want the evidence," he continued. "I've been waiting for several months for any evidence of wrongdoing, or cases where the procurement code has been violated. Because if there are any weaknesses or gaps, as we've said all along, we want to work to tighten it up."

When the task force was announced, there was a hint that some scandal was about to be uncovered. Senator Miller said citizens had lost confidence in the state's ability to buy goods and services without interference from lobbyists, legislators or other

special interests. To demonstrate his interest in a thorough probe, he appointed the entire Senate leadership as members.

In September, House leaders agreed to join the inquiry. Over the next few months, the panel heard testimony about a number of controversial contracts, including the purchase of lottery equipment and home-detention devices, the hiring of a firm to run the state's auto emissions testing program, and a nonbid plan to hook up high schools in a "distance learning" network.

Mr. Miller at the time suggested the task force might consider creating a separate office of inspector general to enforce the procurement law.

But the group's final recommendations, which were approved yesterday, were far less sweeping.

It backed away from a proposal to create an "independent counsel" with broad powers to enforce the law.

Instead, it recommended creation of a "procurement adviser" who would review proposed purchases of goods and services by state agencies and advise the Board of Public Works whether to approve them. The board, made up of the governor, comptroller and state treasurer, has authority over all state contracts worth more than $100,000.

Currently the board gets such advice from the attorney general's office. Legislators said they were concerned that that arrangement creates the appearance of conflict of interest because other lawyers in the attorney general's office work for state agencies seeking the contracts.

The task force also recommended that:

* Members of state advisory boards and commissions be made subject to conflict-of-interest provisions in the ethics law. That would require them to disclose affiliations they or relatives have that may be related to their work for the state.

* Lobbyists who attempt to influence the executive branch on contracts would have to register with the state. They would have to report how much they are paid by, or spend on behalf of, their clients -- just as legislative lobbyists must do. Like their legislative counterparts, they also would be prohibited from accepting contingency fees for their work.

The theory is that a contingency fee is a powerful temptation for a lobbyist to do something illegal or unethical in order to be paid.

* Bidders who file successful protests against the state in which procurement laws or regulations were violated could recoup money spent on preparing and pursuing the protest, except for attorneys' fees.

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