A pair of new, just-released documents show that Amtrak, America’s federally subsidized rail network, wanted to fire its independent Inspector General, who was effectively forced to resign several weeks ago. One of the documents, a June 2009 draft letter was to be signed by Amtrak chairman, Thomas C. Carper. The language in the letter is blunt. Addressed to Vice-President Biden—in his capacity as President of the Senate—and to House Speaker Nancy Pelosi, the letter was to inform Congress—as required by law—of Amtrak’s plan to dismiss Inspector General Fred E. Weiderhold, Jr. Citing a long list of alleged lapses, shortcomings and failures, Amtrak’s chairman wrote that Weiderhold, "is no longer the effective Inspector General that our Company needs" and that he "will be removed from his position."
The letter was never sent. Instead, Amtrak’s management apparently threatened to give it to Congress last month as a none-too-subtle inducement for Weiderhold to step aside, retiring from his role as one of Washington’s longest-serving inspectors general. In a subsequent separation deal with Amtrak, Weiderhold agreed not to disclose details of his retirement, involving a package worth more than $310,000 that included compensation for unused vacation, severance, health care and outplacement assistance.
In a recent interview, which did not mention the draft firing letter, Weiderhold told Politico that his departure arrangements were typical for Amtrak executives, adding that he had been planning to leave his job anyway.
But the draft firing letter reveals deep and bitter conflicts between Amtrak management and their Inspector General. Included in Carper’s reasons for firing his IG are allegations that Weiderhold:
- "… failed to keep the Chairman and the Board fully and currently informed concerning fraud, waste, abuse and other deficiencies within the Company."
- "…has not properly managed the investigations function within the Office of Inspector General to the quality standards required."
- "… is excessively involved in the daily management of the Company to the detriment of his obligation to focus on his fundamental duties."
- "… cannot and does not discharge his duties with the independence and objectivity required of the position."
Weiderhold declined to
respond publicly. Sources tell POGO that the former Inspector General had
grown weary after months of what he viewed as opposition from Amtrak’s
management and board. Confronting
pressing family issues, and the prospect of more battles with Amtrak, he
decided it was time to go.
On the same day Weiderhold opted to retire, June 18, the law firm of Willkie Farr & Gallagher, LLP completed a "Report on Matters Impairing the Effectiveness and Independence of the Office of Inspector General." That report, now public, alleges serious and persistent interference by Amtrak management with its Inspector General in violation of the law. Amtrak earlier released a statement saying there was “no relationship” between the report and Weiderhold’s retirement.
Tensions between Amtrak management and the IG grew heated in 2006, after a joint investigation by Weiderhold and the Inspector General of the Dept. of Transportation found that Amtrak had spent more than $100 million in mismanaged fees to outside lawyers over a five year period, allegedly violating Amtrak billing rules.
More recently, congressional sources received documents showing Amtrak has spent nearly $75 million on outside lawyers in 2007, 2008, and the first half of 2009. That finding, if confirmed, and the accelerating rate of spending on outside counsel—a significant portion of which was spent on battling its own IG—is sure to raise hackles about Amtrak’s government-subsidized expenditures, as well as the conduct of its top lawyer, Eleanor Acheson, who has been the company’s general counsel since 2007, and is Hillary Clinton’s former roommate at Wellesley College.
A second document just made public shows how Amtrak’s chairman and management struggled to get rid of Weiderhold. It is a letter dated July 30 and signed by Charles Grassley, ranking member of the Senate Finance Committee, and Rep. Darrell Issa, ranking member of the Committee on Oversight and Government Reform in the House. Addressed to Jeffrey Zients, Deputy Director of the Office of Management and Budget, the pair describe tactics apparently designed to force Weiderhold to leave his job without a public fuss.
According to Grassley and Issa, Amtrak presented Weiderhold with a separation agreement on June 17, "indicating that if he did not sign it by June 19, the Chairman of the Board (Carper) would send a 30-day notice to Congress to begin the process of removing him as Inspector General." But that proved unnecessary. Instead, the letter says that, on June 18, Weiderhold agreed to leave Amtrak.
In their letter, Grassley and Issa point out that the law requires Congress to receive prior notice when inspectors general are replaced, a provision that Amtrak did not comply with in the Weiderhold case.
The revelations surrounding Weiderhold’s departure are likely to stir controversy, given a string of inspector general firings earlier this year that have drawn Congressional attention.
Amtrak is run as a private company, but is owned and heavily subsidized by the federal government (originally set to receive $2 billion in 2009, it obtained an additional $1.3 billion in stimulus funds). Amtrak’s board appoints the Inspector General. In Weiderhold’s case, he was appointed in 1989, and is the only Inspector General his agency has ever had, a role that has brought him into frequent conflict with both Amtrak’s board and the office of its top lawyer, or general counsel.
Reached by POGO, an Amtrak spokesman said the company stood by its handling of the Weiderhold departure, and emphasized it was working with Congress to resolve questions about the matter. In an earlier statement, Amtrak said its board “is committed to having an OIG that operates under best practices consistent with the Inspector General Act. The Board has been concerned for some time about whether best practices are currently in use in the OIG.”
-- Adam Zagorin