June 10, 1977, Friday, Final Edition

SECTION: First Section; A1

LENGTH: 1282 words

HEADLINE: Acting Gov. Lee Declares End to Md. Scandal Era

BYLINE: By Felicity Barringer, Washington Post Staff Writer

DATELINE: ANNAPOLIS, June 9, 1977

BODY:
As opening arguments began today in the political corruption retrial of Maryland's governor, the state's acting governor stepped behind a lectern in the State House and declared that the state's era of political scandals has ended.

"As far as I'm concerned, that is over," Acting Gov. Blair Lee III declared in reference to what he called a "series of scandals" in Maryland state government. Hammering out his words, Lee added, "There's not going to be any more."

Lee combined his rhetorical flourish with a firm commitment to bar politically influential contractor Victor Frenkil from obtaining a lucrative contract to supervise construction of the Baltimore subway.

In so doing, Lee attempted to draw a firm line between himself and the pervasive taint of corruption that has infected state politics for more than a decade.

Left on the other side of this line was Gov. Marvin Mandel, Lee's political benefactor and working partner for the last decade, who is currently standing trial in Baltimore on charges of corruptly influencing legislation to hes friend's advantage.

"We have a rather serious problem in this state. We've had a series of scandals of one sort or another and the state's name and reputation have suffered," Lee said.

The dramatic pledge and candid analyses by Lee - who also figures as a major Democratic contender in the 1978 gubernatorial race - came in the midst of a press conference he had called to announce the appointment of a key Republican political strategist as the state's Secretary of Transportation.

Hermann K. Intemann, 69, will be taking over the post left vacant by the abrupt resignation two weeks ago of Harry R. Hughes - a resignation made to protest the alleged abuse of meticulous state contracting procedures by Frenkil.

The contracting prize that prompted the "tampering" alleged by Hughes was the $25 million contract for a construction manager to oversee the building of Baltimore's $721 million subway system.

Frenkil, the contractor Hughes accused of tampering with the procedure is head of Baltimore Contractors, Inc. Baltimore Contractor's original bid for the management job was turned down in the early selection stages. Frenkil later allegedly tried to muscle one of the finalists in the bidding contest into including Frenkel's firm as a subcontractor.

If Frenkil's company were not included as a major subcontractor, Frenkil allegedly told an official of the California-based Ralph M. Parsons Co., Parsons' company would not get the job, even though they had been recommended for it by the state's Department of Transportation.

At the same time as he announced Intemann's appointment yesterday, Lee said that Frenkil "was no longer on our eligible list" for the contract.

Although he added that Frenkil "is not an evil man," Lee said that "he does come from the old school of hard-driving contractors who do anything they can to get a contract."

Yesterday's press conference was doubly important to Lee, who is hopping to succeed Mandel as the next governor of Maryland. For one thing, Lee is currently trying to establish his own identity as governor. For another, conferences such as the one today enable Lee to assert his independence from the Mandel administration, which was plagued by scandal allegations.

The question of whether any of the five remaining competing firms will win the $25 million contract has been left hanging since last Friday. Then Lee declared that it was the intention of the Board of Public Works to set up a unit in the state's Mass Transit Administration to manage the project.

That intention was called into question Wednesday by state transportation officials, including acting secretary James J. O'Donnell, who expressed doubts about feasibility of the idea and the potential cost of this plan at a state legislative hearing.

Lee reiterated today that the Board of Public Works, which has authority over all contracts let by the state and of which he is a member, still wants to set up the state unit to supervise the subway construction.

He added, "It's also our desire to find out what the rules and regulations inhibiting that course of action might be . . . If they are not fatal that is doubtless the direction we will take."

Transportation officials have indicated that state personnel rules are the greatest barrier at the moment to the formation of the unit, which would include highly paid engineers who would probably have to be hired outside the state's merit system.

"We are not going to be foolish about it or pig-headed about it," Lee added, after reaffirming his support of the board's preference.

It was not immediately clear yesterday what effect Intemann's appointment would have on this issue. His predecessor, Hughes had long opposed as impractical any in-house management of the subway construction, and Lee said today that Intemann had warned him that the competent engineers that such a management group would need are expensive and "not too easy to come by."

Intemann, an engineer himself and a former vice president of the Union Carbide Corp., has devoted most of his energies in recent years to state Republican politics. He was a major behind-the-scenes figure in former President Ford's Maryland campaign, and is a key supporter of Anne Arundel County Executive Robert A. Pascal, a Republican gubernatorial hopeful.

One Republican politician characterized Intemann as "an extremely hoest man," and added, "There's very little possibility of his placing an embarassing situation around Lee's neck."

Lee, who has spent most of his first week as the state's acting governor trying to sidestep any embarrasing fallout from Hughes' resignation or the subway contract contraversy, took full advantage of today's press conference to forcefully set himself apart from the state's entire recent history of corruption.

Some politicians and some of the media, he said, "are trying to make a scandal" of the Baltimore subway controversy. "It is not a scandal now and it is not going to become a scandal."

In an appareant reference to the contractors involved in the bidding for the management contract, Lee added, "I personally respond well to rational arguments. I'm a good listener. I do not respond well to arm-twisting and the sooner they all realize this, the better.

"I'm up to here with pressure," Lee declared, thrusting his palm under his chin.

Then, in a long recitation of the state's recent history of political corruption, Lee referred to French history to draw out a quote from one of Louis XIV's aides. "Heaven save me from my friends."

"Looking back on what has happened in this state," Lee said, "the people who've gotten in trouble have been victims of their friends. Not enemies. Friends.

"I think (former Vice President) Agnew was brought down by his friends. (Former Baltimore County Executive Dale) Anderson was brought down by his friends. (Former Anne Arundel County Executive Joseph W.) Alton was brought down by his friends," Lee said.

It was then that Lee added, "I am not going to be brought down by my friends or enemies. We're going to handle this (the subway construction contracts) in the best interests of the state of Maryland."

Lee, the scion of a family whose political prominence in the state and the nation dates back to before the Revolutionary War, has spent the last 10 years out of the spotlight in the capital, first as secretary of state, then as lieutenant governor.

In 1974, at the height of the political scandals that preoccupied both Maryland and the country. Lee told a reporter that if the public was beginning to perceive all politicians as crooks, "I want the hell out."

GRAPHIC: Picture 1, LT. GOV. BLAIR LEE III . . . "There's not going to be any more."; Picture 2, New Maryland Secretary of Transportation Herman Intem ann, is introduced to reporters by acting Gov. Blair Lee. AP