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Arundel chief hires friend on handshake Neall is asked to study prison privatization without a contract; 'Kind of a verbal thing'; County officials say $7,600 deal violates standard practices


Without a written proposal or signed contract, former County Executive Robert R. Neall billed Anne Arundel for $7,600 in consulting work in the spring after a handshake agreement with close friend and successor, John G. Gary.

An invoice from Neall's Annapolis consulting firm and a canceled county check represent the only evidence of the unusual way Gary hired Neall in December. Gary paid his predecessor to study whether Anne Arundel would save money by hiring a private company to run the new $29.7 million Glen Burnie jail.

"He asked me to do it, and I did it," said Neall, who gained a reputation for fiscal expertise as Republican county executive from 1990 to 1994. "I don't think there's anyone who knows more about the county detention center than I do."

Neall, who has known Gary for 25 years, was hired in what county officials say was a verbal agreement. At the time, Gary, also a Republican, owed Neall's campaign committee almost $7,500 from a 1994 campaign loan, which has yet to be paid. Gary also received $5,750 in donations from the Neall campaign committee in 1994.

Neall did not submit a written proposal for the study or outline the work he planned to do, county officials said, adding that no other companies were invited to bid on the project. His consulting firm, Robert R. Neall & Associates, produced a three-page memo in March recommending that Anne Arundel operate the detention center on Ordnance Road when it opens next year.

County rules allow contracts of less than $10,000 to be awarded without competitive bidding. But current and former government officials, including a member of the Gary administration, said that hiring a consultant without a contract or work order is unusual.

"If you don't need a contract to do consulting work, then that is news to me," said E. Hilton Wade, Anne Arundel's personnel officer. "I have never hired anyone without a contract."

Said Richard F. Mayer, personnel officer during the O. James Lighthizer administration: "I don't recall any situation in which we had work done where there wasn't a contract outlining it."

The county paid Neall $7,600 on April 12. According to an invoice, Neall billed the county for 57 hours of work at a rate of $200 an hour. He included a 33 percent discount that saved the county $3,800.

"It was kind of a verbal thing," said James F. Ryan, the county's purchasing officer. "There's no contract. It was pretty straightforward. It was based on his unique expertise in this area."

Anne Arundel paid Neall by "direct payment," a method used to settle about 1,500 county bills a month, primarily for goods, rather than services.

Said Councilman James E. DeGrange, a Glen Burnie Democrat: "If they want to do personal business on a handshake, that's one thing. But this isn't their money. It's taxpayers' money."

In his 1994 campaign, Gary promised to carry on Neall's brand of "plain vanilla" government based on fiscal restraint. One of his first tasks in office was to decide whether the county could save money by having a private firm run the jail being built on Ordnance Road.

The county's penal budget will increase 23 percent next year when the 400-bed detention center opens, climbing from $14.8 million to $18 million.

Gary asked Richard Baker, who runs the Office of Detention Services, to study the issue.

The county executive traveled to Texas to look at other privatized prisons and solicited bids from three companies in the corrections field.

Baker's report said small projected financial savings would not justify the county's loss of day-to-day control over a potentially volatile aspect of government.

"That flew in the face of what he [Gary] had been told by private companies and by what he had seen for himself," said Lisa Ritter, Gary's spokeswoman.

Gary hired Neall and John E. Harms, Jr. & Associates, a Pasadena engineering firm, to study the issue. Neall focused on the operations side, and Harms on the construction side.

Harms, which has an open-ended contract with Anne Arundel to provide a variety of services, submitted an 11-page report in February. The county paid $16,565 for the work. Neall submitted his memo a month later. Both reports supported Baker's conclusion that, at least for a year, the county should manage the 400-bed jail. Gary announced his decision in March.

The Gary administration said Neall's selection was based on his experience planning for the new jail and his success privatizing several county agencies.

"He [Neall] had done a great deal in-house on privatization -- period," Ritter said.

Pub Date: 9/26/96

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