Gov. John G. Rowland's (search) former chief of staff has been put on notice to expect a federal indictment this summer, The Associated Press has learned.

Peter Ellef (search), who has been investigated as part of the corruption probe for more than a year, would be the highest ranking member of Rowland's inner circle to be indicted. Ellef oversaw construction projects the FBI has been scrutinizing.

Investigators notified Ellef's attorney, Hugh Keefe, of their plans last week, according to a source familiar with the timing of the investigation who spoke to the AP only on condition of anonymity.

Keefe would not confirm that conversation Tuesday, but said, "We've previously been informed that Mr. Ellef is a target of this investigation."

Rowland, a Republican in his third term, is being investigated for gifts he received from wealthy friends and businessmen who received millions of dollars in state contracts. A legislative impeachment committee is in its second week of public hearings on Rowland's conduct.

Ellef's subordinate, Lawrence Alibozek (search), has already pleaded guilty to steering contracts in exchange for money and gold. Alibozek is cooperating with federal investigators.

Rowland's personal attorney, William F. Dow III, said Ellef's indictment would not affect the governor.

A spokesman for the U.S. attorney's office had no comment.

Ellef has been under scrutiny for his relationship with principals of The Tomasso Group (search), a construction contractor that provided and coordinated free work at Rowland's summer cottage and accompanied Ellef on a state-funded trip that gave them an edge in the competition for a $57 million project.

A businessman told the legislative impeachment committee on Tuesday that Rowland assured bankers in 1997 that the state would provide a loan for the governor's friend Robert Matthews, who was buying a New Haven business.

That same year, Matthews bought the governor's Washington, D.C., condominium, using a straw buyer, at an inflated price, according to earlier testimony.

"The governor indicated not to worry about the state's part of it and (the bankers) should do their part," said Michael Santogatta, who served as president of Matthews' Fabricated Metal Products.

The committee also heard testimony that first lady Patricia Rowland received a $15,000 speaking fee from W.R. Berkley Corp. of Greenwich.

She appeared at a W.R. Berkley conference, and the company provided air travel, meals and accommodations at a resort in Key Largo, Fla., for her and the governor.

In a sworn statement, chief executive William R. Berkley said he believed the speaking fee would help the Rowlands financially. Rowland was earning $78,000 until last year, when his salary was raised to $150,000.

"On occasion, both Governor Rowland and his wife have told me about the financial difficulties they faced given the governor's salary," Berkley said.

Berkley said he believed he paid for the Rowlands to stay at the Florida resort in February 1997. A few months later, he said he spoke to Rowland about a contract that the state was planning to award to a competitor.

"To the best of my recollection, the governor said he would look into the matter," Berkley said. "Thereafter, a Connecticut subsidiary of the company (Berkley) did obtain that contract."

Committee officials, who estimated the contract was worth about $20 million for Berkley's company, said they did not find evidence of any pressure applied by the governor in connection with the contract.