Loophole let county chief hire friend Arundel law allows several exceptions to contract rules

'You want flexibility'

Neall's work at least 3rd case of allies getting no-bid projects

September 29, 1996|By Scott Wilson | Scott Wilson,SUN STAFF

By hiring friend and predecessor Robert R. Neall for consulting work with a handshake, County Executive John G. Gary stepped through a loophole in county contracting regulations that are among the loosest in the metropolitan region.

Anne Arundel rules do not require the administration to announce major contracts awarded without competitive bids, which is law in Baltimore County. Nor must the County Council approve no-bid contracts -- as the panels in Howard and Baltimore counties do -- except in cases requiring money from future budgets.

County rules say only that work costing more than $10,000 must be advertised for public bidding. But the rules make one major exception: A contract exceeding $10,000 is not subject to competitive bidding when an individual or company is deemed most qualified for the job.

That determination is left to top administration officials, who make the decision without written criteria or review.

"It's subjective," said Deborah Povich, executive director of Common Cause Maryland, a public-interest watchdog group. "A competitive bid will assure that a patronage system is not established to funnel public money to private friends. For expediency, it is appropriate to have no-bid contracts in limited circumstances. But that should be clearly spelled out."

At least three times since June 1995, Gary and Cabinet members have decided that former colleagues and friends were the most qualified to perform work for the county. The agreements were worth more than $50,000 and would have been advertised for bidding or required council approval in neighboring counties.

County officials argue that the less-restrictive rules provide flexibility to hire the best people -- even if it means spending more.

"There are two goals to purchasing regulations," said Lisa Ritter, Gary's spokeswoman. "One, you want flexibility so you have managers and employees working in an efficient, businesslike manner. Two, you have them to ensure safeguards. We have to be careful on both sides."

Last year, Gary hired Neall, a government finance expert, with an unusual oral agreement. His task, never outlined on paper, was to determine whether Anne Arundel should privatize the Glen Burnie jail when it opens next year.

"I can't imagine anyone who would be more objective and qualified for the work than Bob Neall," said James F. Ryan, the county's purchasing officer.

At the time, Gary, a Republican, owed Neall's campaign committee almost $7,500 on a 1994 campaign loan, which has not been repaid. Gary also received $5,750 from the fund during his campaign. Gary said he hired Neall, also a Republican, based on his work planning the jail and privatizing several agencies while running the county from 1990 to 1994.

In April, Neall billed the county $7,600 after giving Gary a three-page memo advising him not to privatize the jail.

In August 1995, Tom Brewster, a former top Montgomery County personnel official, received a no-bid contract from Anne Arundel's personnel office to study the county's pay system.

The bidding process was not required, according to administration officials, because Brewster was uniquely qualified to conduct the "reclassification" study.

Brewster has received $33,000, according to county purchasing records, more than three times the no-bid limit. Last month, he was hired as a merit employee by Anne Arundel's personnel officer, E. Hilton Wade, who worked with Brewster in Montgomery County. Said Wade: "There is no question in my mind" that he is the most qualified for this work.

But administration critics disagree with these exceptions to the contract process. "We have these bidding procedures for a reason and they should be followed," said Councilman James E. DeGrange, a Glen Burnie Democrat.

In June 1995, Gary quietly hired a private investigator and Annapolis attorney, John R. Greiber Jr., a Republican who lost a bid for Anne Arundel state's attorney two years ago, to investigate allegations of criminal conspiracy in O. James Lighthizer's administration. The work was not bid; no contract was signed.

In December, the county received a bill from Greiber's law firm for $10,620 -- again above the $10,000 no-bid threshold. County financial officer John R. Hammond requested the bill be paid.

Povich said the county should consider strengthening its laws by requiring council approval of big contracts.

Pub Date: 9/29/96

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