HARRISBURG -- House Republican leader Sam Smith is criticizing Gov. Ed Rendell for awarding a lucrative contract for turnpike commission legal services to a prominent Philadelphia law firm for which he used to work.

"At the minimum it has the appearance of a conflict of interest," Mr. Smith, R-Punxsutawney, said yesterday about a $1.75 million contract that the Pennsylvania Department of Transportation, part of the Rendell administration, gave to Ballard Spahr in May 2007.

Mr. Rendell, a Democrat, worked for the firm in 2001-02, after he finished eight years as Philadelphia mayor but before he became governor in January 2003.

"Obviously there are some close ties there" between Rendell officials and Ballard Spahr, Mr. Smith said.

Mr. Rendell's chief of staff in his first term, John Estey, has gone to work for Ballard Spahr, as has another former top administration official, Adrian King. Ken Jarin, another lawyer at Ballard Spahr, is married to Robin Wiessman, whom Mr. Rendell named as state treasurer.

Mr. Smith thinks the contract with Ballard Spahr "has the potential to fundamentally corrupt, or to taint, whatever proposal ends up coming out of the administration" about leasing the Pennsylvania Turnpike to a private bidder.

"I don't understand what that law firm is doing for that [$1.75 million] value, when you have another firm like Morgan Stanley" also working for the state on the turnpike lease, Mr. Smith said.

Rendell aide Chuck Ardo said the firm's Rick Ballard "is widely recognized as an expert on ... tax exempt bonds," expertise that PennDOT lawyers don't have.

Administration lawyers said Ballard Spahr "was best qualified to work on a complex, multibillion public financing deal" such as the turnpike lease, Mr. Ardo said.

He said that anyone who sees a conflict of interest in the matter "needs to have their vision tested." The fact that Mr. Rendell used to work for Ballard Spahr "didn't influence the decision [to hire the firm] in any way," he said.

From January 2003 to June 2007, Ballard Spahr was paid $8.4 million in outside legal fees. The new $1.75 million contract for the turnpike lease is in addition to that. Two other Philadelphia law firms were, however, paid more than Ballard Spahr from 2003 to 2007.

Mr. Rendell is hoping a turnpike lease could generate up to $1.5 billion a year, which the state would use to fix ailing roads, bridges and mass transit.

Revenue from Act 44 of 2007, enacted in July, will average only $946 million a year, for the first 10 years, for transportation improvements. But first, the federal government must permit the state to place first-time tolls on Interstate 80, a plan which faces opposition.

About 14 companies or consortiums have expressed interest in leasing the turnpike. Mr. Rendell had hoped to release the highest bid by the end of this month, but that deadline has been pushed back.

Mr. Smith said the Legislature must approve any bid to lease the turnpike, since that action would have a widespread effect on the driving public. He said the Legislature should be told about the top two or three turnpike lease bids, not just the highest bid.