Remarks in an article on the District's Historic Preservation Office in the May 28 Real Estate section were incorrectly attributed to Betty Kane. They should have been attributed to Betty King.

The National Park Service has lifted the suspension it imposed two months ago on the District of Columbia's historic preservation program, and Park Service officials indicate they expect soon to remove the restrictions on federal historic preservation grants to the city.

However, those actions come at the same time as the announcement of two investigations of D.C.'s Historic Preservation Office and also of strong expressions of concern about some of the nominations Mayor Barry has made for a new historic preservation review board.

The D.C. auditor, at the request of D.C. City Council member John Wilson, has begun a broad investigation of the preservation office. "It's not just a straightforward 'checkbook' financial audit," said City Auditor Otis Troupe earlier this week. "It also involves the operation of the office."

Wilson's request for an investigation came because of many questions that have been raised about the preservation program and the way it has been operated. "We've been hearing of problems in the preservation office," said Brigid Quinn, Wilson's executive assistant. "We want to pull it all together."

The city auditor will be investigating a number of questions about the operation of the preservation office, according to Quinn. Among these are questions about the small number of properties the office has nominated to the National Register of Historic Places, about whether required reports for other city agencies have been prepared in a timely fashion, and about recent shifts in staff work assignments within the office.

Preservationists familiar with the D.C. program have expressed strong praise for the office's professional staff members, however. "All of us have the highest regard for their professional competence," said Karen Gordon of Don't Tear It Down, a Washington preservation group. "We have a very high impression of them."

One junior and two senior members of the city auditor's staff are conducting that office's investigation. "The bulk of the work will be done in three to four weeks," Troupe estimated earlier this week.

The agency will prepare a draft report and send it to all the persons involved for their comments, which will be included in the final published form of the study, Troupe said.

A narrower investigation, of D.C.'s expenditures of federal historic preservation grant money between 1978 and 1980, was completed earlier this year by the National Park Service, according to federal officials.

The service sent its preliminary conclusions to the city in mid-April and is awaiting the local government's response before reaching conclusions, according to a Park Service representative.

A number of steps are being taken to correct past problems with the preservation office, Carol Thompson, the director of the recently established D.C. Department of Consumer and Regulatory Affairs, emphasized in a presentation she made last week to the Committee of the 100, a citizens group interested in Washington design and planning issues.

At the end of March, the preservation office was transferred from the D.C. Department of Housing and Community Development to Thompson's new agency. At that time, Thompson also took over as the District's historic preservation officer, a position previously held by the head of the department of housing.

The office's director, Lucy Franklin, characterized the Park Service investigation as dealing mainly with problems of accounting methodology, rather than ones of substance. The Department of Housing is now preparing a response which will be reviewed by Thompson before being sent to the Park Service, Franklin said Wednesday.

The National Park Service suspended the District of Columbia as an approved historic preservation program two months ago, barring it from receiving federal grant money for historic preservation activities, from nominating properties to the National Register of Historic Places, and from participating in the certification of District projects for historic rehabilitation tax incentives.

The federal agency took that action because of "long-standing budgetary and staffing problems" in the District program that "had not been resolved despite numerous phone calls, letters, and meetings with National Park Service Regional Philadelphia Office personnel," according to a March 31 letter from the NPA.

On May 12, the Park Service notified the District that it was lifting the suspension of the preservation program and would resume the flow of grant money to the District once the historic preservation office completed a proper submittal of budgetary materials for the last fiscal year.

Earlier this week, Park Service representatives said District officials have been working hard to prepare that documentation and they expected to receive it either this week or early next week.

The Park Service's removal of its sanctions followed Mayor Barry's nomination on May 9 of 11 persons to a new state board to oversee the city's historic preservation activities. That board will take over most of the responsibilities now carried out by the Joint Committee on Landmarks, a group sponsored by the mayor's office, the National Capital Planning Commission, and the Fine Arts Commission.

One of the reasons for the Park Service's suspension of the District as an approved program was the city's failure since 1981 to find a prehistoric archeologist to serve on the board, as is required by the Interior Department regulations governing all such state review boards. It was the mayor's responsibility to make committee nominations, which were subject to the approval of the other sponsors.

Some preservationists have expressed strong reservations about several of the mayor's nominees to the new review body.

Interior regulations require that a majority of the mayor's nominees be professionals in the fields of architecture, archaeology or architectural history.

Preservationists, however, have raised questions about the experience and dedication to preservation of some of the other, "citizen" nominees. "They're all fine people, but they have no background whatsoever in historic preservation," said Richard Wolf, an attorney and a member of the Capitol Hill Restoration Society.

Under federal regulations, nonprofessional citizen members with "demonstrated interest or competence in historic preservation" may be appointed to a review board, provided the majority of persons on it are professionals.

Barry aides have emphasized the need for "balance" on the board. "The nominees are good representatives of the community who have a familiarity with community concerns," said Betty Kane, the mayor's assistant for boards and commissions. "If the mayor put active preservationists on the board, he'd have to put on active developers.

"He'd have to balance that person a preservationist with a person who is anti-preservationist."

The City Council's Committee on Consumer and Regulatory Affairs, whose chairman is John Ray, held the first of two round table meetings on Wednesday to discuss the mayor's nominees to the new board. At that session, the 11 nominees, along with two supporters each, made brief presentations.

Next Friday, citizens will be allowed to present their views on the candidates. The council committee has sent notices of that meeting to a number of District groups concerned with preservation, inviting them to comment on the nominations, according to Margaret Gentry, a special assistant to Ray.