Congressional hearing blues

Lehman’s Fuld called to Capitol Hill

The House Committee on Oversight and Government Reform has scheduled a hearing to examine the regulatory mistakes and financial excesses that led to the collapse of Lehman Brothers Holdings Inc.

There is a whole speciality within PR crisis communications that consists of preparing clients for congressional testimony. Unfortunately Presto Vivace does not offer this because these practitioners are going to earn a bundle in the next twelve months and very likely beyond.

Preserving Government Records

Panel would reform records storage

“Too often over the past several years, our investigations have revealed weaknesses in government preservation of e-mail that could leave substantial gaps as future historians examine White House and agency decision-making,” said Rep. Henry Waxman (D-Calif.), the committee's chairman and one of the bill’s sponsors, in announcing the legislation.

In a related development, preliminary findings from the Government Accountability Office released today summarized a survey of recordkeeping processes at four agencies. Although the agencies generally met NARA's statutory requirements, its policies were not always followed, GAO auditors said.

“The loss of documents and information through indifference should be viewed with as much alarm as their loss through a system breach,” said Patrice McDermott, director of OpenTheGovernment.org, in her opening statement for a hearing set for today by a subcommittee that deals with federal information policies and issues. After a series of votes delayed lawmakers, the session was postponed indefinitely.

Little progress has been made in electronic records management across the federal government, McDermott said, and “we repeatedly have to relearn the lesson, apparently, that servers and backup tapes are not appropriate records management systems.”

It is unclear whether we need to relearn that lesson or whether the Bush White House chose not to learn that lesson.

White house email and the Presidential Records Act

Where have all the e-mails gone?

Waxman's staff report notes that the Presidential Records Act requires the president to ensure that all "activities, deliberations, decisions, and policies that reflect the performance of his constitutional, statutory, or other official or ceremonial duties are adequately documented ... and maintained as presidential records" and charges that White House officials used their RNC e-mail accounts "in a manner that circumvented these requirements."

Using email accounts on the Republican National Committee server to conduct official government business could be judged as a evasion of the Presidential Records Act.

Hunt the slipper, email edition

United States House of Representatives Committee on Oversight and Government Reform

There are several next steps that should be pursued in the investigation into the use of RNC e-mail accounts by White House officials. First, the records of federal agencies should be examined to assess whether they may contain some of the White House e-mails that have been destroyed by the RNC. The Committee has already written to 25 federal agencies to inquire about the e-mail records they may have retained from White House officials who used RNC and Bush Cheney ’04 e-mail accounts. Preliminary responses from the agencies indicate that they may have preserved official communications that were destroyed by the RNC.

Imagine yourself the Chief Information Officer for a federal agency and you are presented with a inquiry from the Oversight and Government Reform Committee for any email you may have originating from the Republican National Committee. How would you know? Where would you look? This is a great content management story.

Sun Microsystems and the GSA

Changes Spurred Buying, Abuses

In February 2005, an auditor at the General Services Administration presented evidence to agency leaders that one of the government's top technology contractors was overcharging taxpayers.

GSA auditor James M. Corcoran reported that Sun Microsystems had billed the government millions more for computer software and technical support than it charged its commercial customers.

If true, the allegation was grounds to terminate the contract and launch a fraud investigation. Instead, senior GSA officials pressed last summer to renew the contract.

This is every federal contractor’s nightmare, a high profile congressional investigation complete with a front-page story in the Washington Post. This is also one of the differences between the private sector and government contracting. If a business thinks you are ripping them off they will simply change suppliers. The last thing they want is a series of articles about how they permitted themselves to be ripped off. Governments are led by politicians who make their careers by exposing fraud, real and imagined. Every detail of your contract could be subject to public scrutiny.

For the civil servants caught up in this, it is a fearsome thing. It is very difficult to defend yourself against an angry committee chairman. The best thing I can suggest is to contact your public affairs officer and get the facts before the public. That is what the news room section of your website is for. Work with the government contracting press, who don’t have to be brought up to speed on the finer points of GSA rules and procedures.

Sun needs to get its story out. There is nothing on their website. I would recommend a straight forward explanation of their side of the negotiations along with a timeline. It would also be useful to document any differences between what they offer their commercial customers, and what they do for their federal customers, in a way that would allow the general public to understand why the federal government is paying a higher price.

There is one point on which I would like clarification:

As it negotiated with the GSA, Sun hired the Washington Management Group, a consulting firm that employs former senior GSA officials, the Waxman memo said. The firm operates the Coalition for Government Procurement, an association of GSA contractors that includes Sun.

I have never heard of trade association that was operated as a division of a private company. I would like to know more about this.

It would be useful if we had a time line beginning with the laws that changed the rules of government contracting. What are those laws and when did they go into effect? Are they just laws or are executive orders also involved? When did the cut backs in personnel overseeing the contracts occur? What areas were affected? We need some charts to show the rise of both the number of contracts and the dollars expended.

Rise in expenditure is not, in and of itself, an indicator of wrong doing. During the period in question every single government agency launched its website. They also completely changed the way they manage documents. These were success stories and should not be treated as suspect.

Waxman hearings miscellany

FCW’s Buzz of the Week seems to have missed the point:

And the January lunch, although almost undeniably inappropriate, was not planned or approved by Doan and came months after one election and years before another.

If you think of Washington, DC as an ocean, then you must understand that the great political storms blow across the surface, while the civil service, their contractors, and the press which covers them, inhabit the abyssal sea, far below the storm.

If you want to use federal contracts to make politicians in marginal districts look good, you have to plan months in advance. You have to know which contractors are located in which districts, and of those, which have the best connections to the politicians in question. In order to have contracts in place to puff vulnerable politicians in time to affect the election, you have to plan months in advance. The same publication which has a detailed understanding of software life-cycle management, and why advanced planning is essential to good IT management, seems to have failed to understand why a political briefing for the GSA had to be held in January 2006 if it was to use government contracting to affect the 2008 election. It is simply impossible to come up with any other reason for such a meeting.

Matthew Weigelt has a good summary of the day’s proceedings, my favorite quote - “These meetings grew out of a recognized need to do team-building with GSA’s noncareer employees,” Doan said. As one of the committee members asked, what sort of team were you building?

G. Martin Wagner has a good article explaining why all this matters, highly recommended for those not familiar with federal contracting. Even if you never intend to sell to the federal government, this affects you as a citizen.

Sun Microsystems, Doan, and the Waxman Committee

The Washington Post

The five-hour hearing also focused on Doan's involvement last year in a contract dispute with Sun Microsystems, a technology firm that GSA auditors allege had overcharged the government.

Waxman's committee heard testimony from Sen. Charles E. Grassley (R-Iowa), who has also been examining the Sun deal.

Grassley testified that his investigators found evidence that Doan and her senior aides urged the agency's contracting staff to renew the contract, despite questions about alleged fraud and overcharging.

By August last year, three contracting officers had balked at renewing Sun's contract with the GSA.

Grassley said that despite "repeated warnings" to senior GSA officials in 2006 about the contract, GSA renewed the contract with Doan's blessing and "with no conditions, strings, or precautions regarding the alleged fraud."

Doan said she had an obligation to keep a close eye on the Sun contract and did nothing wrong. She said she did not "even know" the contract officials involved in negotiations. She said she urged a solution to a negotiation impasse with an important government contractor but did not intervene.

So far Sun Microsystems has issued no statement on the controversy. This is typical of federal contractors in these sorts of disputes, keep your head down and let the politicians slug it out. I think they are well advised, it may not be edifying, but it works.

Lurita Doan’s testimony to the Committee on Oversight and Government Reform

Government Executive has an excellent preview with links to the relevant documents. FCW has a summary of the morning’s testimony which is very sympathetic to Doan, mostly for what it leaves out.

Listening to the hearing on CSPAN, it seem to me to be a disaster for Doan. Her use of the selective memory defense was so disingenuous as to embarrassing. Waxman has wisely put the relevant documents on the committee website. I don’t see how anyone can look at the January 26 slide presentation and not conclude that is was an improper presentation for a government agency. Doan’s protestations, that while she attended the meeting she had no memory whatsoever of the presentation, and was unable to characterize it, insults our intelligence.

On the whole these hearings and investigations will be a good thing for government contractors.

Further coverage -
Federal Times: New memo details allegations against GSA administrator

GSA Administrator Doan to testify before the Waxman committee

GSA Chief Is Accused of Playing Politics

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. ...

I can think of no reason for such a presentation to the Government Services Administration.

..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. ...

This blog intends to cover this hearing.

... 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. ...

I knew Waxman was going to make Crisis Communications a growth industry.

Doan Denies 'Improper' Use of Agency for GOP

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.

I wonder who is going to prepare Fraser for her appearance before the Waxman committee. Crisis Communications is going to make a lot of money out of this Congress; but our industry is going to look bad, really bad.