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VA, embroiled in scandal, looks to avoid fate of GSA

Aug. 19, 2012 - 12:54PM   |  
By STEPHEN LOSEY   |   Comments

The Veterans Affairs Department, rocked last week by a scandal concerning excessive conference spending, hopes to skirt the fate that befell the top leadership at the General Services Administration four months ago.

VA’s Office of Inspector General is investigating allegations of wasted money and improper gifts at two human resources training conferences last summer in Orlando, Fla., that cost a combined $5 million.

Rep. Jeff Miller, R-Fla., and other sources on Capitol Hill briefed on the IG’s preliminary findings said the alleged wasteful spending includes:

• $84,000 in promotional items distributed to the conferences’ 1,829 attendees, including pens and highlighters with VA’s logo.

• $13,000 for about a half-dozen employees’ scouting trips to at least three locations under consideration for the conferences.

• At least $100,000 more in other, unspecified waste, bringing the total amount of questionable spending to roughly $200,000.

Congressional sources also told Federal Times that VA employees who organized the conferences may have illegally accepted gifts from hotels they were scouting. Those alleged gifts may have included free rides in helicopters and a stretch limo, lodging, food, alcohol, concert tickets, spa treatments and gift baskets. The IG has not yet reached any conclusion on those allegations. It will likely release its report by the end of September, and lawmakers are expected to hold hearings soon after.

The setting and details are reminiscent of GSA’s infamous 2010 Western Regions Conference in Las Vegas. When details of that conference surfaced in April, GSA’s top leaders were ousted and replaced for failing to move fast enough to punish the officials behind that conference and for even rewarding some of them with thousands of dollars in bonuses.

In contrast, VA Secretary Eric Shinseki appears to be moving fast to contain the damage.

Shinseki spoke to Sen. Susan Collins, R-Maine, on Aug. 10, after IG staffers briefed Collins and other lawmakers on their preliminary findings. And on Aug. 13, VA issued a statement that called the alleged misconduct unacceptable and said the agency has stripped employees under investigation of their contracting authority.

Shinseki ordered an outside review of all training policies and procedures to be completed within 90 days. And VA ordered employees involved in recertifying, planning and executing training conferences to undergo ethics training.

“Secretary Shinseki ... will hold accountable any individuals who are found to have misused taxpayer dollars or violated our standards of conduct,” VA said.

Shinseki’s rapid response shows how definitively the GSA conference scandal has changed government attitudes toward conference spending, said Joe Newman, spokesman for the watchdog group Project on Government Oversight. But Newman said the mere existence of the VA conference scandal, so soon after GSA’s scandal, shows this kind of waste likely runs throughout the government.

“If the GSA scandal hadn’t broken, it would have been business as usual,” Newman said. “It’s not surprising these things happen. Maybe we should be [surprised], maybe that’s unfortunate that we’re not surprised. ... It points to a systemic problem in these agencies.”

Gifting especially concerning

Newman said the allegations involving improper gifts are most concerning, since those gifts may have undermined the procurement process.

Federal contracting officials — whether they’re procuring weapons systems, office supplies or a conference venue — are supposed to base their decision solely on what is the best deal for the government, Newman said. They are supposed to avoid even the appearance of being swayed by other factors, including gifts from potential contractors.

Newman said it’s too soon to tell whether the alleged gifts prompted the VA officials to select Orlando’s Marriott World Center over other locations but that the allegations are worrisome — and typical of contracting violations.

Government ethics rules prohibit federal employees from accepting most gifts from people or organizations that do business or are seeking to do business with their agency or are otherwise affected by the agency’s mission. Federal rules allow employees to accept gifts that are valued at no more than $20 — which allows them to accept small things such as snacks or pens.

But meals are forbidden, as are concert tickets. Stretch limousine rentals and helicopter rides can run more than $100 an hour — well over the $20 limit.

“People will try to get any advantage they can,” Newman said. “That’s why the rules are set up to avoid that situation.”

The Orlando Marriott declined to comment when reached by Federal Times.

‘Alarming’ allegations

Collins, in an Aug. 10 letter to Shinseki, called the allegations and preliminary findings “alarming.”

“Despite the legitimate purpose of training, there can be no excuse for excessive or wasteful spending of VA resources,” Collins said in the letter. “At a time when so many veterans of the wars in Afghanistan and Iraq are in need of care and assistance, the VA must make every effort to spend each dollar in support of its important mission.”

American Legion spokesman Marty Callaghan said his group is disappointed with VA’s “apparent mismanagement of funds.”

“Our country’s veterans must be able to trust VA [and] be sure it is making the right decisions in these times of fiscal restraint,” Callaghan said. “We need to ensure that the dollars allocated to the VA budget are going to the timely delivery of high-quality health care.”

VA’s IG began investigating allegations of wasteful spending and improper acceptance of gratuities in April after receiving a tip on its hotline. Collins’ office said that tip came in the wake of the GSA conference scandal.

The $5 million in VA conference spending is more than GSA’s $823,000 Western Regions Conference both in total dollars and in per-person costs. VA spent almost $2,734 per person at the two conferences. The Western Regions Conference — attended by 306 people — had a per-person cost of almost $2,689.

According to schedules posted online for the two conferences, attendees were provided complimentary shuttle services to the Walt Disney World resort, entertainment from a comedian, a poolside movie night, game nights, karaoke, and meditation, Pilates and water aerobics classes.

Miller said investigators should look into those recreational events.

“The key question is whether taxpayers funded what were ‘down time’ activities,” Miller said. “If that turns out to be the case, I see no excuse for it. That is not a function of government.”

The VA IG’s office said the conferences were for legitimate purposes, but would not provide more details on what investigators found.

POGO’s Newman said the revelations should remind federal employees about the importance of safeguarding taxpayer dollars, and that they can’t expect to get the same perks as private-sector employees.

“People in government have got to be more vigilant about not only how they spend money, but the appearance,” Newman said. “I think people are aware of what goes on at private industry conferences — and they’re all parties, there’s always going to be entertainment — but that’s not what we should be emulating when we’re stewards of public trust.”

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