Special federal investigators recommended yesterday that a high-ranking Small Business Administration official be fired and fined $1,000 for allegedly considering the political affiliations of SBA employes in implementing a nationwide transfer plan.

The disciplinary recommendation is the first of its kind by the special counsel's office of the U.S. Merit Systems Protection Board, which investigates alledgedly improper personnel practices within the federal civil service.

In addition to the public disciplinary action against the official, associate deputy administrator Paul D. Sullivan, the investigative panel also found that in the same transfer plan, the SBA itself had violated several federal rules and regulations prohibiting politically oriented job transfers. The SBA has 30 days to respond to those findings.

Sullivan is one of the top five officials at SBA and reports directly to SBA Administrator A. Vernon Weaver. He has been at the SBA for two years, and was previously executive director of the Democratic National Committee.

Sullivan said last night he was "absolutely distressed" by the allegations against him and that he "categorically denies" that political affiliation played any part in the rotation plan. He said the allegations against him omitted major portions of his testimony to the panel, and that the charges took his remarks to the panel "out of context."

In the course of its investigation, the panel concluded that Phillip J. Wise Jr., President Carter's appointments secretary, was among those apparently aware of the job transfer plan and discussed it with Sullivan.

No action is contemplated against Wise, investigators added. The panel did recommend, however, that in addition to being dismissed and fined, Sullivan be prevented from holding any federal job for the next five years.

Sullivan, who was head of support services for the SBA, was in charge of an SBA plan implemented last year to rotate various SBA district directors, the complaint said. There are 63 district directors, and 14 of them ultimately were ordered shifted to jobs in other locations.

Seven of those shifted retired or accepted other jobs rather than be transferred, according to the complaint.

Before Sullivan began implementing the plan, he was specifically told by other SBA officials that job transfers should not be used to force resignations or get rid of "politically undesirable" employes, the complaint said.

"Transfer, like other government action affecting an employe's status, may not be based on an arbitrary decision to achieve predetermined result," Sullivan was told in the SBA policy memorandum.

Sullivan then interviewed various SBA regional administrators to discuss the job rotation plan, and later assigned other members of his office to draw up the plan.

According to notes of those conversations, Sullivaan "provided his staff with the names of specific directors targeted for rotation together with information on the nature and degree of those directors' political affiliations," the complaint said.

"The notes reveal that political affiliations as well as other partisan political considerations were factors in Sullivan's targeting of specific directors for rotation and his strategy for implementing the rotation policy," according to the complaint.

The notes said the directors were identified by a code that included the designations "R-Republicans who we do not move," Democrats that we do move and "R that we want to move and we do move and upgrade." Other notations were "R-want and we want," "R-don't and we want," "R-don't and we do not," and "D-want and we want," according to the complaint.

Despite those classifications, an official memorandum issued later that profiled the district directors targeted for rotation omitted any mention of party affiliation, but instead used "cooperativeness" as the major factor affecting job placement. Fifteen of 16 Republican directors originally targeted for rotation were described as "lelss than cooperative," "particularly uncooperative," or "less than fully cooperative," the complaint said.

Sullivan said last night that the memo being discussed contained other paragraphs that more fully explained his view on the transfers, and that those paragraphs were omitted in the complaint against him.

He said the memo also stated that "it should be noted that on the political side, some of these moves will create objections by both Republican and Democrat members of Congress," and that, "We will be catching heat coming and going." He said the political affiliations were discussed only because of these possible ramifications in Congress.

According to the complaint, during the course of the job transfer program Sullivan was contacted by White House aide Wise, who asked him to find a job for Russell Davis, a former mayor of Jackson, Miss. Sullivan said in an affidavit to the investigative panel that Davis was "causing us a great amount of embarrassment" at the time by telling people in Jackson he was going to get the job.

The then-Jackson district director was subsequenetly ordered reassigned, the complaint said, and was told it was because "the administration desires a change."

Sullivan said in an interview last night that the exchange with Wise was taken out of context. He said Davis ultimately was found to be legitimately qualified for the position by the Office of Personnel Management, and still was rejected.

Acting Special Counsel Mary Eastwood informed SBA Administrator Weaver in a letter yesterday that the agency job transfer plan had violated several provisions of the Civil Service Reform Act of 1978. Among them are statutes that prohibit discrimination against federal employes on the basis of political affiliation, preferential advantage not authorized by law for particular persons, and creating vacancies by forcing retirements or resignations.

The complaint against Sullivan now goes to the three-member Merit System Protection Board for further proceedings. That board can accept, reject or alter the special counsel's recommendation of disciplinary action against him.

Sullivan, a former businessman from Hawaii, went to the SBA as assistant administrator for congressional affairs. He orchestrated the 1976 Carter campaign in Illinois.