Three of the seven directors of the federally funded Synthetic Fuels Corp. have called for the dismissal of its president, Victor A. Schroeder, who is the subject of allegations of mismanagement and improprieties in office.
One agency official testified at a Senate hearing last month that Schroeder offered another director help for his private business in return for the director's support for a Schroeder plan to reorganize the public corporation.
Investigators for the Senate Governmental Affairs subcommittee also found that Schroeder has awarded 51 consulting contracts without competitive bidding, some of them to his former business associates.
And an internal Synthetic Fuels Corp. audit report concluded that Schroeder improperly charged the corporation more than $25,000 for payments on his Alexandria home.
Schroeder, 62, a former Atlanta developer who is paid $135,000 a year as Synthetic Fuels Corp. president, strongly denied any wrongdoing. He said in an interview that his actions have been "twisted" by "duplicitous" people opposed to his stewardship of the 3-year-old corporation.
The latest controversy began last March when Schroeder sought and received support from board member Milton M. Masson Jr. for a plan to reorganize the corporation, which was created to provide financing for development of alternative sources of energy.
During the same conversation, Schroeder said, he agreed to contact a friend at Mobil Land Development Corp. to find out whether the oil company subsidiary had any business that might be performed by Masson's engineering design firm.
Schroeder insisted at the Senate hearing last month that there was no connection between his lobbying to reshape the synthetic fuels agency and his offer to help Masson's private business.
But a witness to the late-night conversation, corporation executive Donald Thibeau, told subcommittee Chairman William S. Cohen (R-Maine) that it was was clear that Schroeder and Masson "came to an understanding" on the two matters.
Schroeder said yesterday that he was "a little bit disgusted" with the allegations. "I've been in the business world for 35 years and I've never resorted to any such tactic," he added. "People talk to their friends in business every day."
The conflict among the corporation's directors comes at a time when many on Capitol Hill are increasingly dissatisfied with its performance. Although Congress has given the corporation $15 billion to invest in new energy technology, it approved the first project only last month.
Schroeder and other corporation officials blamed the lack of progress on a combination of high interest rates, falling oil prices and delays in organizing their staff. They now expect to finance production of less than one-third the equivalent of 500,000 barrels of oil a day that Congress has mandated for 1987.
The corporation was exempted from Civil Service rules in an effort to attract top-flight businessmen, but its high standard of living has attracted considerable attention. The agency pays 10 officials more than $69,000 a year, provides fringe benefits that far exceed those at federal agencies and rents expensive offices at 2121 K St. NW in a building that contains a sauna and racquetball court.
Schroeder was chosen by the corporation's chairman, Edward E. Noble, who was appointed by President Reagan and who has been a longtime friend and sometime business associate of Schroeder. Schroeder's wife, Kathryne, has long worked for Noble and is now his $32,000-a-year secretary.
Noble has declined to comment on the letter he received from three corporation directors--Robert A.G. Monks, C. Howard Wilkins Jr. and John B. Carter Jr.--urging that Schroeder be replaced.
Schroeder testified last month that he met privately with Masson in a New York hotel room last March 23, the night before the board was scheduled to vote on Schroeder's plan for a sweeping corporate reorganization. Schroeder said Masson agreed to support the plan after Schroeder "lobbied" him.
Masson then "asked me if I knew anybody with Mobil Land and I told him that I did . . . ," Schroeder said. "He asked me if I could find out if they had any work in his area of the country that he could bid on, and I told him that I would . . . ."
Schroeder said he later called the Mobil Land official and was told that the company had no pending work in Arizona, where Masson is based, but would keep Masson's name in its files for future consideration.
Although it is possible that the land company's parent firm, Mobil Oil Corp., might seek funding from his agency in the future, Schroeder said, he did not see a potential conflict with his call to the Mobil Land official.
"It is so far disconnected that it makes no sense to me at all to connect it," Schroeder told Sen. Carl Levin (D-Mich.). "You are reaching out into space, in my opinion, for the connection."
The subcommittee subpoenaed Thibeau, Noble's executive assistant, who was in the hotel room during the conversation. Asked by Cohen whether "a deal had been struck or made between the two men," Thibeau said: "Senator, it was my impression that Mr. Schroeder and Mr. Masson came to an understanding."
"In your judgment, the understanding was that Mr. Masson would support Mr. Schroeder's proposal the next day, and, in return, Mr. Schroeder was going to make a phone call or calls on behalf of Mr. Masson . . . ?"
"Yes, senator," Thibeau replied. He said that "anyone in the room would have come to that conclusion."
Masson supported Schroeder's plan the next day, but the board deferred action on it.
Masson, who could not be reached for additional comment, testified that he never followed up on the Mobil Land matter because "it was not, quite frankly, gentlemen, high priority on my list, certainly not high enough to make a deal or to deal my vote." He said it was "harmful to my integrity to even insinuate I would do something like that."
Wilkins said he considered the private discussions "an irregular activity in a public corporation. We all have misgivings about it."
Wilkins said Schroeder rarely consults with other board members about policy. "It's being run as a family corporation with one stockholder, and we don't think that's consistent with the way the Synfuels Corp. was set up," he said. "They need to start telling us what's going on."
Wilkins also expressed concern about an internal audit report that questioned Schroeder's expenses under a program that pays employes for part of the cost of relocating in Washington. Schroeder charged the agency $19,500 for what the auditors said was an unallowable commission to a real estate broker for the purchase of his Alexandria home, which raised the price from $305,500 to $325,000.
Schroeder also received more than $4,500 from a fund that compensates employes for buying a house at higher interest rates than their old one. The auditors challenged the payment because Schroeder never sold his house in Atlanta.
Schroeder said there was "nothing irregular" in these payments, but he voluntarily has repaid the $19,500 broker's fee.
Schroeder acknowledged that all 51 individual consulting contracts he has awarded since last year have been made without bidding. Among the recipients are two Atlanta men who Schroeder said have done work for him in the past: Eugene Rawls, who was paid $103,000 to redecorate the corporation's offices, and John Carbonell, who received $21,000 for a six-page communications study.
"It makes no sense to put up personal services for competitive bid," Schroeder said. "Where else are you going to find people to do work the way you need it done, other than people that you know or that someone knows?"