McCaskill Investigates GSA Bonuses

FOR IMMEDIATE RELEASE

APRIL 10, 2012

Contact:

John LaBombard: 202-228-6502, 202-384-4132 (c)

Anamarie Rebori: 202-228-6253, 202-631-3310 (c)

Following GSA Firings, McCaskill Targets Bonuses at the Agency

Senator demands information on bonuses awarded during investigation

 

WASHINGTON – Following an Inspector General report detailing shocking abuse of taxpayer money by the Government Services Administration (GSA), U.S. Senator Claire McCaskill—a former Missouri State Auditor—is targeting bonuses given to officials while they were under investigation at the agency.

McCaskill, who began investigating GSA in 2010, today requested the names of agency officials who have received bonuses while under investigations by the Inspector General or while they were subjects of audits, as well as the size of those bonuses.

“Although I am encouraged by the actions taken to date to hold the agency’s senior leadership accountable, I have concerns about whether your agency has sufficiently addressed what appears to be a pervasive culture of rewarding officials for misconduct relating to the expenditure of taxpayer dollars,” wrote McCaskill, Chairman of the Senate Subcommittee on Contracting Oversight. “I recently learned that many of the individuals named in the Inspector General’s reports received substantial cash bonuses for their performance in 2010 and 2011.  According to information received by the Subcommittee, members of the planning team for the Western Regions Conference, who spent more than $100,000 just to plan the conference, including six planning meetings at the Las Vegas resort where the conference was held, received bonuses ranging from $500 to $1,500 for each  individual “in recognition” of their contribution to the conference. The Subcommittee has also learned that the Regional Commissioner for Region 9 received approximately $9,000 for his performance in 2011.”

McCaskill’s request, in a letter to new Acting Administrator Daniel Tangherlini, comes a week after the Obama Administration announced that GSA Administrator Martha Johnson has resigned and that Bob Peck, GSA Public Buildings Service Commissioner, has been fired.

The personnel changes were the result of an Inspector General report into a GSA conference held in Las Vegas and followed an earlier hearing which McCaskill chaired in 2011 into waste, fraud, and abuse of taxpayer dollars through GSA contracts. Region 9 staff were responsible for planning the conference in question.

At a March 2011 hearing, McCaskill questioned Martha Johnson and Bob Peck regarding GSA's decision to award a no-bid public relations contract and the failure of senior Administration officials to adequately review and justify the contract price.  The GSA IG released a report earlier this year finding that “some of the information provided by GSA officials during the hearing contained misstatements of fact” and that a supplemental letter provided by the then-Administrator Martha Johnson contained “incorrect” information and failed to correct the earlier errors. In today’s letter, McCaskill noted that the individual found to have made misstatements of fact to the Subcommittee also received a bonus.

McCaskill is an outspoken advocate for accountability in government. Last year, a top official at the U.S. Department of Labor resigned after an Inspector General investigation, requested by McCaskill, found that the official, Assistant Secretary of Labor for Veterans’ Employment and Training Services (VETS) Raymond Jefferson, circumvented rules and regulations to secure government contracts for friends and colleagues.

McCaskill’s letter is available on her website, HERE, and appears below.

April 10, 2012

Daniel M. Tangherlini

Acting Administrator

United States General Services Administration

1800 F Street NW

Washington, DC 20405

Dear Mr. Tangherlini:

Last week, the General Services Administration (GSA) Inspector General released two reports finding serious problems with the management and oversight of contracts by GSA’s Public Buildings Service.  Although I am encouraged by the actions taken to date to hold the agency’s senior leadership accountable, I have concerns about whether your agency has sufficiently addressed what appears to be a pervasive culture of rewarding officials for misconduct relating to the expenditure of taxpayer dollars.

On April 2, 2012, the GSA Inspector General issued a report which found that the agency spent more than $822,000 to plan and hold a conference for approximately 300 GSA employees in Las Vegas, Nevada.   The Inspector General found that GSA’s spending was “excessive and wasteful” and that GSA failed to follow contract regulations in many of the procurements associated with the conference.   On April 6, 2012, the Inspector General publicly released a report which found that the GSA used government purchase cards to acquire more than $430,000 on iPods, digital cameras, and gift cards for employees as part of the “Hat’s Off” employee incentive program, in violation of contracting regulations.   The two reports contain multiple instances of misconduct by GSA officials at many levels and in several regions. 

Although the Inspector General’s reports were made public only last week, the Subcommittee has learned that GSA has been aware of the reports’ findings for nearly a year.  The Inspector General provided an interim report on the Western Regions Conference to the agency on May 3, 2011.   GSA first received a report into the investigation of the “Hat’s Off” program on June 28, 2011.   Both reports named employees who had engaged in illegal or improper behavior. 

I recently learned that many of the individuals named in the Inspector General’s reports received substantial cash bonuses for their performance in 2010 and 2011.  According to information received by the Subcommittee, members of the planning team for the Western Regions Conference, who spent more than $100,000 just to plan the conference, including six planning meetings at the Las Vegas resort where the conference was held, received bonuses ranging from $500 to $1,500 for each  individual “in recognition” of their contribution to the conference.  

The Subcommittee has also learned that the Regional Commissioner for Region 9 received approximately $9,000 for his performance in 2011.  Although the Senior Executive Service bonus review committee, which was aware of the Inspector General’s findings, recommended that he should not receive any bonus for the year, their recommendation was overruled by senior GSA leadership, including former GSA Public Buildings Service Commissioner Robert Peck.

I have previously raised concerns regarding GSA’s award of bonuses.  At the Subcommittee’s March 1, 2011 hearing into GSA’s award and management of contracts for public relations services, I noted that the Regional Commissioner for Region 6 had received a bonus despite adverse findings regarding her conduct by the Inspector General.   I subsequently learned that the Regional Commissioner received a bonus for 2011, despite an ongoing Inspector General investigation which ultimately found that some of her testimony before the Subcommittee contained misstatements of fact.

I welcome the steps taken to date to hold agency leadership accountable.  However, I have concerns regarding whether these steps are sufficient to address GSA’s culture of providing cash bonuses and “incentives” to officials who are the subjects and/or targets of ongoing investigations by the Inspector General.  

As a result, I request that you provide a briefing for Subcommittee staff on these issues, including the amount of bonuses received by all GSA officials who are mentioned or who have subsequently been removed or placed on administrative leave in connection with Inspector General interim or final reports from January 1, 2008 through the present.  I request that you provide the information and briefing on or before April 27, 2012.

The jurisdiction of the Subcommittee on Contracting Oversight is set forth in Senate Rule XXV clause 1(k); Senate Resolution 445 section 101 (108th Congress); and Senate Resolution 73 (111th Congress).  An attachment to this letter provides additional information about how to respond to the Subcommittee’s request.

Please have your staff contact Margaret Daum at (202) 224-4462 with any questions.  Please send any official correspondence relating to this request to kelsey_stroud@hsgac.senate.gov.

Sincerely,

(s)

Claire McCaskill

Chairman

Subcommittee on Contracting Oversight

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