Washington Post Staff
GSA Chief Is Accused of Playing Politics
Mon Mar 26, 2007 11:22
 

General Services Administration improperly used for Karl Rove's Partisan Electioneering Republican politics

http://www.washingtonpost.com/wp-dyn/content/article/2007/03/25/AR2007032501048.html

GSA Chief Is Accused of Playing Politics

Doan Denies 'Improper' Use of Agency for GOP

By Scott Higham and Robert O'Harrow Jr.Washington Post Staff Writers

Research editor Alice Crites contributed to this report.


Monday, March 26, 2007; Page A01

Witnesses have told congressional investigators that the chief of the General Services Administration and a deputy in Karl Rove's political affairs office at the White House joined in a videoconference earlier this year with top GSA political appointees, who discussed ways to help Republican candidates.

With GSA Administrator Lurita Alexis Doan and up to 40 regional administrators on hand, J. Scott Jennings, the White House's deputy director of political affairs, gave a PowerPoint presentation on Jan. 26 of polling data about the 2006 elections.

When Jennings concluded his presentation to the GSA political appointees, Doan allegedly asked them how they could "help 'our candidates' in the next elections," according to a March 6 letter to Doan from Rep. Henry A. Waxman (D-Calif.), chairman of the House Oversight and Government Reform Committee. Waxman said in the letter that one method suggested was using "targeted public events, such as the opening of federal facilities around the country."

On Wednesday, Doan is scheduled to appear before Waxman's committee to answer questions about the videoconference and other issues. The committee is investigating whether remarks made during the videoconference violated the Hatch Act, a federal law that restricts executive-branch employees from using their positions for political purposes. Those found in violation of the act do not face criminal penalties but can be removed from their jobs.

Waxman said in the letter that the remarks made during the videoconference have been confirmed by "multiple sources." Congressional investigators have taken statements from GSA employees and others in recent weeks.

The planned hearing is part of an expanding examination by Waxman's committee of Doan's tumultuous 10-month tenure as administrator of the GSA. The government's leading procurement agency annually handles about $56 billion worth of federal contracts.

The committee is also expected to question Doan about her attempt to give a no-bid job to a friend and professional associate last summer. In addition, the committee plans to look at Waxman's charge that Doan "intervened" in a troubled technology contract with Sun Microsystems that could cost taxpayers millions more than necessary.

In the Senate, Doan is facing a similar line of questioning in letters from Sen. Charles E. Grassley (R-Iowa). Also examining Doan are the GSA's Office of Inspector General and the independent federal Office of Special Counsel, which investigates allegations of Hatch Act violations.

In several recent statements, Doan has said she did nothing wrong. She said her troubles are the result of retaliation by the inspector general over her efforts to rein in spending and balance the GSA budget. Doan, a wealthy former government contractor who sold her company before taking over the GSA last May, has hired three law firms and two media relations companies at her own expense to handle inquiries from the federal investigators and the news media.

"Ever since I made the decision to restore fiscal discipline to all divisions within GSA, I have had to face a series of personal attacks and charges," Doan said in a March 7 statement.

Doan did not respond to questions for this article. She said in the statement that she looks forward to facing the oversight committee.

"I am eager to have the chance to set the record straight and provide a full and complete record to Congressman Waxman and the Committee and refute these allegations," Doan said.

Waxman's investigation began in response to a Jan. 19 story in The Washington Post about a no-bid job Doan tried to give to firms run by Edie Fraser, a veteran Washington public relations executive who had served as a paid consultant to Doan. Waxman's investigators concluded that the two women had "a long-standing business relationship" that was not "previously disclosed," according to Waxman's letter.

Between 2003 and 2005, Fraser billed Doan as much as $20,000 a month in consulting fees to "generally promote attributes" of Doan and her company, New Technology Management Inc., according to invoices obtained by The Post. In all, Doan paid at least $417,500 to companies affiliated with Fraser before Doan took over the GSA, according to Waxman's investigators.

Last year, Fraser helped prepare Doan for her GSA confirmation and lined up political support for her, according to interviews and e-mails obtained by The Post.

On July 25, two months after Doan took office, she took the unusual step of personally signing the no-bid arrangement with Diversity Best Practices and Business Women's Network, firms then run by Fraser, to produce a report about GSA's use of businesses owned by minorities or women. The GSA's general counsel at the time, Alan R. Swendiman, told Waxman's investigators he was "alarmed" that the project was not competitively bid.

Last month, in a letter to Waxman's committee, a senior GSA official called the no-bid arrangement a "procedural mistake." Doan told The Post that she submitted a service order for the work through normal GSA contracting channels and did not focus on it afterward.

But Swendiman, now a special assistant to President Bush, told Waxman's investigators that he "immediately and repeatedly" advised Doan to terminate the arrangement. When he was unable to persuade her, Swendiman directed a GSA contracting officer to terminate the arrangement. The investigators found evidence indicating that Doan continued to try to find ways to award the project to her friend.

The committee's examination of the Jan. 26 videoconference could raise questions about the role of Jennings, the White House official who works for Rove.

Jennings's name has recently surfaced in investigations of the firing of eight U.S. attorneys around the country. He communicated with Justice Department officials concerning the appointment of Tim Griffin, a former Rove aide, as U.S. attorney in Little Rock, according to e-mails released this month. For that exchange, Jennings, although working at the White House, used an e-mail account registered to the Republican National Committee, where Griffin had worked as a political opposition researcher.

Jennings is a longtime political operative from Kentucky. He served as political director for Sen. Mitch McConnell (R-Ky.) in 2002 before joining the White House.

After Jennings and Doan spoke during the videoconference, one regional GSA administrator offered the suggestion that House Speaker Nancy Pelosi (D-Calif.) could be excluded from the opening of an environmentally efficient federal courthouse in San Francisco, which Pelosi represents, according to Waxman's letter. GSA manages the nation's federal courthouses.

The letter cited evidence that Doan then raised questions about "the upcoming opening of a courthouse in Florida," based on statements from participants in the videoconference. Doan noted that President Bill Clinton had suggested he might attend, and she "stated that an effort should be made to get Senator Mel Martinez, the General Chairman of the Republican National Committee, to attend," Waxman said in his letter to Doan.

"It would be an obvious abuse if you suggested to agency officials that the activities of the agency be manipulated to provide political advantages to Republican candidates," Waxman told her in the letter.

In a March 13 letter to Waxman, Doan wrote that "there were no improper political actions that occurred during or as a result of the January 26 teleconference."

Jennings declined to comment Friday and referred questions to the White House media affairs office. White House spokesman Scott Stanzel said Jennings did not ask GSA officials to help Republican candidates and described Jennings's presentation as "a factual assessment of the political landscape."

Waxman's committee also plans to question Doan about her alleged involvement last year in a technology contract with Sun Microsystems. The GSA, which collects a small percentage of the value of the contracts it handles, was at risk of losing substantial fees from the Sun contract if it was not renewed.

Two GSA contracting officers had balked at renewing the deal, citing findings by the GSA's inspector general that Sun was allegedly overcharging taxpayers, not giving discounts to the government that were made available to private companies.

Waxman's letter alleged that Doan "intervened" in the matter and that she suggested one of the contracting officers was too "stressed" and might be replaced. Days later, the agency brought in a new contracting officer, who approved the deal within two weeks.

That officer was later granted a previously denied transfer to an agency field office in Denver.

In a statement, Sun Microsystems said it cooperated with the audit.

"We are honored to be a government contractor, and our current contracts with GSA represent the culmination of over two years of very active negotiations," the statement said. "Any suggestion that GSA gave Sun special treatment during the negotiation process simply does not fit the facts."

Grassley, the senator questioning Doan, said in a statement Friday that Doan and her subordinates should have heeded warnings by the agency inspector general's office that problems with the Sun contract had been discussed with Justice Department officials.

"The allegations alone should have been a showstopper, but they instead chose to turn a blind eye, failed to take corrective action, and allowed a bad contract to move forward that will cost taxpayers millions of dollars," Grassley said. "It's unacceptable."

Doan has told Grassley and Waxman that she did nothing improper.

"There was no undue influence in the award of the Sun Microsystems renewal contract," she wrote to Waxman. "I had no role whatsoever in any personnel actions involving anyone involved in those contract negotiations."


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