Tom Fedor/The Gazette WSSC Commissioner Juanita D. Miller outlines her complaints about how the water and sewer utility awards contracts and treats its black employees at a commission meeting in Laurel on Thursday. Flanking Miller are Marita B. Brown (left) and Chairman Manuel R. Geraldo.

The charges come even as the bi-county agency is being rocked internally by dissension and externally by federal regulators seeking environmental compliance.

Commissioner Juanita D. Miller, who is ending her term and is running for state Senate, sent a letter Monday to a Justice Department antitrust lawyer, asking him to investigate suspected bid rigging. Kevin P. Maloney, a Montgomery County representative on the commission, separately called for an independent investigation of the contracting practices during a contentious meeting Wednesday in Laurel.

Their complaints follow a report confidentially commissioned by the Montgomery County Council in April. That report found that several commissioners misused public money to buy newspaper advertisements or contribute to nonprofit groups.

Based on the report, Montgomery County Council President Steven A. Silverman (D-At large) of Silver Spring sent the WSSC a strongly worded letter last month, seeking reforms in auditing, ethics and spending guidelines and procedures and demanded a reply by Thursday.

Montgomery and Prince George's counties jointly oversee the agency, setting its budget and appointing commissioners.

The controversy comes just months after the agency dismissed a contractor and an employee following an internal audit found the pair defrauded the utility of more than $200,000.

WSSC, with headquarters in Laurel, provides drinking water and sewer services to 1.6 million residents in Montgomery and Prince George's counties.

Miller and Maloney, normally bitter rivals, have joined forces this time to accuse the utility of mismanagement.

In her July 15 letter to the Justice Department, obtained by The Gazette, Miller said she has documentation about "what appeared to be bid rigging and collusion in the architecture/engineering and construction areas."

She refused to give documentation of her claims to The Gazette, saying lawyers advised her against doing so.

The Justice Department lawyer that Miller contacted, Peter H. Goldberg, had given seminars at WSSC General Manager John R. Griffin's request in the past few months about antitrust issues such as bid rigging. Justice officials did not return phone calls about Miller's allegations on Thursday.

Miller also accused managers of "targeting" African-Americans and women workers for harassment. She said managers ordered WSSC security to follow black employees suspected of improperly using the utility's vehicles. She also made numerous other allegations.

"The WSSC is definitely back to business as usual," she said. "Ratepayers' money is being used to harass."

Griffin vehemently denied Miller's and Maloney's claims. He said blacks have not been targeted, but he did acknowledge that some employees were followed after complaints were made about abuses.

Miller, who expects to be replaced on the commission by Prince George's County Executive Wayne K. Curry (D) at the end of the month, is challenging Senate President Thomas V. Mike Miller Jr. (D-Dist. 27) of Chesapeake Beach.

Maloney said the utility has been grossly mismanaged, costing it millions and distracting it from its core mission. He was the only member of the commission to vote against a three-year contract extension given to Griffin in February.

But Griffin received high marks for his performance heading the agency last year when Maloney was the commission's chairman.

"He voted for and signed a performance evaluation that gave me the highest rating. Have I gone to hell in a handbasket in six months?" Griffin asked.

Both Maloney and Miller said they have long had concerns about the contracting process and the bid rigging. But they differ on who is benefiting. Miller said an old-boys network exists that results in contracts going to a favored few contractors. Maloney said he believes contracts have been steered to minority firms that are not qualified.

Miller is black; Maloney is white.

Both also claim that employee morale has plummeted recently.

The three other commissioners at Wednesday's meeting expressed confidence in the utility's management and said major progress has been made in diversity of the workforce and efficiency of operations in the past several years.

The three, led by Chairman Manuel R. Geraldo, said the issues raised by Miller and Maloney should not be discussed in public. He said he plans to schedule a six-hour closed-door session to discuss Miller's and Maloney's charges.

Geraldo also chastised Maloney, saying that he had been complaining for months without providing any evidence of his charges. Maloney said that was not true, but Geraldo cut Maloney off.

"I'm through with you," Maloney said.

County investigates WSSC

In March, Maloney met with County Council members Isiah Leggett (D-At large) of Burtonsville and Marilyn J. Praisner (D-Dist. 4) of Silver Spring -- both of whom represent the council on the WSSC leadership group -- to complain about procurement practices and unauthorized expenditures by commissioners among other charges.

Maloney said some WSSC commissioners have spent money from their "travel account" for items not allowed under WSSC's travel policy. Not all commissioners have used money inappropriately, he said.

WSSC's internal process to oversee travel account expenditure is not working well, Maloney claimed. The agency's former internal audit manager/corporate secretary, Mel Schwartz, was authorized to question any spending request by a commissioner.

But Schwartz was not encouraged or supported when he raised questions, Maloney charged.

Based on Maloney's allegations, Silverman ordered the council's Office of Legislative Oversight on April 18 to investigate.

Following the investigation, Silverman sent a letter to WSSC last month outlining specific changes, including strengthening WSSC's internal auditing, having the auditor report annually to both county councils and executives, developing clear rules for commissioners' travel account and requiring commissioners to disclose any contact about pending procurements.

The Gazette obtained a copy of the Office of Legislative Oversight's 82-page report that outlined auditing, spending and ethical deficiencies.

The report includes a September letter from Schwartz to Maloney that alleges that Miller accused Schwartz of "retaliation" for questioning her travel expenses to attend a "Blacks in Government" conference to Los Angeles in August. Six days later, she sent her travel reimbursement request to the WSSC's chief financial officer, stating in her letter that Schwartz refused to process her requests.

In a letter to the council's investigators, Griffin said Maloney misspent his travel account money by using WSSC managers' official credit cards to avoid showing that he had gone over his annual travel limit. Griffin cited two instances, including a trip Maloney took to the American Water Works Association's annual conference in Denver in June 2000 where $1,187 in hotel and dining expenses was charged to a senior manager's WSSC credit card and $309 to the auditor's credit card.

"Shortly after I became General Manager, I was advised by several commissioners and other veteran managers that 'broad latitude' has been given for many years to Commissioners on these expenditures," Griffin wrote.

The OLO found that some commissioners did spend money from their travel accounts for items not allowed under WSSC policy and that such expenditure was not a new practice at the agency.

OLO listed other "inappropriate" expenditures, including:

*Purchasing tables at events such as the Boys and Girls Club Annual Snow Ball ($500 by Commissioner W. Gregory Wims).

*Donating to the Portuguese Heritage Scholarship Foundation Gala ($125 by Geraldo).

*Advertising in publications and newspapers such as Montgomery County's Churchill High School PTSA directory ($120 by Commissioner Jinhee Kim Wilde, a candidate for the House of Delegates), Korea Times ($750 by Wilde), Chosun Daily ($500 by Wilde).

*Buying personal membership in various organizations such as Boys and Girls Club of Greater Washington ­ Montgomery County ($260 by Wims).

*Paying membership dues for groups such as the Franklyn Bourne Bar Association ($100 by Geraldo).

Maloney also said that individual contractors have told him that they were "advised" by WSSC personnel to submit contract bids that included specific Minority Business Enterprise subcontractors and that WSSC's legal staff are not routinely involved in approving procurement/contracting procedures and awards.

The OLO found no documentation of any procurement and contracting irregularities in its initial investigation, but said it is inherently difficult to find such evidence.

Maloney also said Griffin had used WSSC money to pay for a six-day training conference in June 2001 to Halifax, Nova Scotia, organized by the Shambala Institute, a Buddhist group. Attending that conference had no connection to Griffin's job, Maloney charged.

Griffin countered that the conference was a management course and the Buddhist connection was incidental.

"I think he could use some meditation," he said about Maloney.

WSSC: Better or worse?

The WSSC has not raised rates for five years and has cut more than 600 workers from its payroll. It has about 1,500 employees, and further job cuts are planned.

Geraldo said the utility's track record of not raising rates shows good management. But Maloney disputed that, saying mismanagement ultimately will result in higher costs and rate increases.

Griffin said that while higher rates are inevitable, any increase would be modest and steady.

Griffin, former secretary of the state Department of Natural Resources, defended the agency as doing more with less. He said Miller brought up many of these issues only after she was told that Curry would not reappoint her to another term.

Miller told The Gazette that because Wednesday's meeting was likely her last as a commissioner, she did not want to let the opportunity to air her concerns go by.

"This was my swan song," she said.

There has been a breakdown of trust in the organization, Miller said.

"People fear arbitrary targeting and loss of their jobs," she said. "There is targeting here, and there is targeting among African Americans and females."

She complained that the information technology department, which is headed by a black man, had its budget slashed, while another department, headed by a white manager, did not face similar cuts.

"There is a potential class action suit against this organization for the targeting, for the racial discrimination," Miller said.

This is not the first time Miller has accused WSSC management of racism. In 1997, she complained that contracts were steered to white-owned firms. Then General Manager Cortez White, who is black, accused her of using McCarthyite tactics.

Miller said that since she voted to extend Griffin's contract in February, she has been disappointed by his performance.

Prince George's County Council Chairman Peter A. Shapiro (D-Dist. 2) of Mount Rainier praised the utility's management Thursday.

"The leadership of the WSSC should be commended for what they have done to improve the agency," Shapiro said, adding that it is normal to have turmoil and disgruntled people when overhauling an agency. "The Prince George's leadership is recognizing the wonderful work that they have done to keep rates down without compromising service, without compromising water quality. They run a very successful agency.

"In an election year, sometimes people use what they can to make noise," Shapiro said.

Despite the brouhaha, Silverman said, he does not see any need for further investigation, which he said would be a "fishing expedition."

Staff Writers David Abrams and Eric Kelderman contributed to this report.