Mayor Marion Barry recently has been trying out on audiences what sounds suspiciously like a reelection campaign theme: that regardless of what the media may say about Barry's personal style, he has done much to bring efficiency and integrity to government.
But revelations last week of widespread incompetence and wrongdoing and possible criminality within Barry's administration have put a serious crimp in his campaign strategy. Ironically, the mayor and his top aides volunteered or were forced to disclose much of this information. For example: Barry released an extraordinary report prepared by his legal counsel, Herbert O. Reid Sr., which concluded that the D.C. Department of Administrative Services' handling of lucrative contracts and leases was rife with corruption and irregularities.
The report largely blamed Jose Gutierrez, the former agency head who has openly criticized the administration. Barry fired Gutierrez May 20, and Gutierrez responded by filing suit in U.S. District Court, claiming he was the victim of a smear and seeking $3 million in damages and reinstatement in his job.
Gutierrez contends that the real culprits are Barry and City Administrator Thomas Downs. He claims that on numerous occasions he was pressured to award contracts to the mayor's political cronies. Assistant D.C. Treasurer Fred Williams admitted under oath last Friday to backdating a memorandum he submitted to the City Council. The memo was designed to justify the city's decision last December to begin investing with a New Jersey-based securities firm that later went bankrupt.
Williams may have lied when he told the City Council earlier this month that he had personally contacted four references provided by the firm, Bevill, Bresler and Schulman Inc., before recommending that the city go ahead with the investments. Two of those references have denied ever speaking with Williams. Deputy Mayor Alphonse G. Hill and other high-ranking financial officers acknowledged in testimony before the City Council last Friday that there had been major gaps in the city's review of BB&S Inc. before the firm was added to the city's list of preferred investment institutions.
For instance, nobody from the city bothered to examine the records of the federal Securities and Exchange Commission. If they had, they would have learned that in 1980 the SEC censured and barred BB&S from trading in certain mortgage-backed securities for 60 days because of fraudulent activities. Hill, D.C. Controller Anthony Calhoun and Williams told the council that the city has repeatedly violated key provisions of the D.C. Depository Act during the past four years because, they said, the law is difficult to enforce.
By law, the administration is required every three years to assess local banks that are used as depositories for D.C. funds to determine whether they are setting aside a portion of their loans for low-income residents and small businesses and whether they are employing minorities. Banks that do not do well in the rankings would lose out on future deposits.
"The effect of the ranking would literally cause us to discontinue doing business with the major financial institutions in the city," Williams told council members in explaining why the city declined to publish rankings in 1981 and again in 1984.
Council member Betty Ann Kane (D-At Large) said during the weekend that much that has surfaced in recent weeks -- particularly charges of wrongdoing in the awarding of city contracts -- has confirmed what she and other critics of the administration have long suspected. "All the pieces are starting to come together," she said.
Council member John A. Wilson (D-Ward 2), who spearheaded the investigation of the city's involvement with BB&S Inc., said the council hearings have confirmed that the administration failed to do "any sensible kind of analysis" before investing nearly $100 million of the city's funds. Wilson, chairman of the Finance and Revenue Committee, said the hearings also confirmed that the administration sought to deceive the City Council and that it has ignored important provisions of the D.C. law regulating the handling of the city's cash.
"What annoys me more than anything else is that we spend hours on the council passing bills, and nobody listens to them," Wilson said. "Whether they're cumbersome or not, the law is the law."