Mattie Taylor, a Democratic candidate for mayor and a former District official in charge of the city's disability payments program, charged yesterday that a study of disability benefits performed for the city in 1984 by a Chicago firm was unnecessary.
Taylor, who in 1984 was in charge of the city's disability benefits program as a deputy director of the employment services department, said she strongly objected to the proposed study, but another city agency without seeking new bids changed the size and scope of an existing contract with the Chicago firm of Robert H. Carter III & Associates to enable it to do the disability study.
Carter, the head of the Chicago firm, has been subpoenaed to answer questions about his firms' District government contracts before a federal grand jury that is investigating whether D.C. Deputy Mayor Alphonse G. Hill received kickbacks or other financial incentives in awarding city contracts.
Hill, who has declined to comment on the ongoing investigation, previously strongly denied any wrongdoing.
Taylor, who has made corruption within Mayor Marion Barry's administration a focus of her campaign, said yesterday that Barry and his aides have wasted million of dollars in taxpayer money by awarding city contracts for unneeded studies or for services whose costs are inflated.
"It's a whole system of how to make money off the city government," Taylor said. "They the Barry administration spend thousands and millions of dollars, and nothing gets done."
The city's office of financial managment, which is under Hill's control, awarded a contract in 1983 to Carter's firm to study the city's life and health insurance programs. The contract orginally was for $69,000 but was expanded three times without new bids, and the final cost was $198,000, according to a senior city official.
The third time, the office of financial management changed Carter's contract, which took place in September 1984, the scope of the contract was expanded to include the disability benefits study for the Department of Employment Services. The additional work cost $45,000 and was ultimately paid for by the employment services department, according to the city official.
Another informed city official, who asked not to be identified, said the request to amend Carter's contract to include the disability study came from the employment services department, and not from Hill or any of his aides. The official said he assumed that officials of Carter's firm had sold the idea to employment services officials.
Fred Marshall, a former vice president of Carter's firm, said that before he joined Carter's company in the summer of 1984 he submitted a proposal to the employment services department to study the disbility benefits program, but the department turned him down.
Marshall, who left the firm in early 1985 after a falling out with Carter, said that some time after he joined Carter's company he learned that Carter's firm had been hired to do the disability study. Marshall said he did the work on the study for Carter's firm. He said he later learned that Carter's firm charged the city about $20,000 more than he had proposed.
Taylor said that in the summer of 1984 James George, then chief financial officer for the employment services department, urged her to approve the proposed study.
"I blew my top. I told him it was unnecessary," Taylor recalled. She said she was particularly angered when, in a meeting with George and Marshall, George showed her an already prepared outline of what the proposed study would do. She said she told George it was more important to reduce the backlog in disability payment claims than to have a study.
"Jim George, Al Hill and other top city fiancial officials . . . all are a little brotherhood," Taylor said.
George, reached by telephone yesterday, declined to comment.
George was placed on administrative leave last month by Barry after federal prosecutors said George violated the department's contracting and purchasing regulations in connection with city funds fraudulently obtained by former top Barry aide Ivanhoe Donaldson.
Donaldson is currently in federal prison serving a seven-year sentence for his corruption conviction.