In July 1980, when thousands of dollars were reported missing from personal bank accounts of residents at the city's Forest Haven institution for the mentally retarded, Human Services department director James A. Buford quickly pledged to return the money.

Since then, former DHS accounting officer Lemuel L. Taylor has been indicted, tried and finally convicted last September of misappropriation and theft. In all, $70,000 was discovered missing from at least 52 residents, including three who were dead and whose bank accounts were emptied.

Yet 11 months after the conviction, the city still has not reimbursed the residents of the institution in Laurel.

"This is outrageous," said Charles Inlander, the court-appointed monitor of Forest Haven's current program to move residents into the community.

Inlander, who reviews operations at Forest Haven under a 1978 U.S. District Court decree, said the department made little effort to recover the money quickly and offered him conflicting explanations for the delay. The retarded, he said, "are supposedly protected by the government. The government can't be responsible for all the misdeeds, but restitution is something that should have been responded to right away."

Buford said yesterday that the reimbursements have been delayed because it took five months after Taylor's conviction before DHS received from the U.S. Attorney's office in Baltimore a list of the residents and the amounts stolen. Then, he said, it took another six months before DHS could determine the proper budget account to use for reimbursing stolen monies.

"We didn't know which fund to take it from," Buford said.

Buford said, however, that $40,000 of the missing $70,000 will be returned to the accounts as early as next week. Because only $40,000 has been attributed to Taylor's actions, Buford said DHS is waiting for word from the U.S. Attorney's office before moving to return the remaining $30,000.

He said his department has not been lax in handling the matter, adding that DHS' six-month search for a proper account "is not a long time." Buford said he did not know when DHS first asked the U.S. Attorney for a list of the victims and amounts.

In private financial institutions, employes who handle money generally are bonded, and in cases of theft the bonding company is obligated to promptly reimburse the account.

Forest Haven's 630 residents, ranging from children to the elderly, have a total of more than $1.5 million in personal funds accumulated from past savings, family gifts, inheritances, trust funds, and in some cases, from current jobs. As wards of the city, the residents have their bank accounts administered by city officials, who make withdrawals when residents want money for such personal items as radios, television sets, gifts, field trips or items purchased at the Forest Haven canteen.

Inlander said that the accounts, some containing $30,000 or more, represent the life savings of the residents.

Buford said that all the living victims of the theft still had money remaining in their accounts. "This has not caused any resident a problem, to my knowledge," Buford said.

At Forest Haven, the mother of a long-institutionalized female resident said yesterday: "People are definitely upset that the money hasn't been returned." The mother, who asked that her name not be used, said however that she did not know of any cases in which residents were deprived of the ability to make purchases.

She also said families often complain that even under normal circumstances they are unable to determine how much is in the accounts. "I have tried to find out how much is in my daughter's account but it took a lot of phone calls," she said.

Taylor, the acting chief of Forest Haven's accounting office and one of four persons authorized to handle withdrawals from patients' accounts, was convicted last Sept. 17 in U.S. District Court in Baltimore of misappropriation and theft of $40,462 that was taken between February 1979 and May 1980.

Taylor, who resigned his job and faces a sentence of up to 15 years' imprisonment, has appealed the case to the U.S. Court of Appeals.