The Project On Government Oversight (POGO) Blog

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The Project On Government Oversight is a small organization that strives to hold a very large federal government accountable to its citizens. Because POGO does not accept gifts from corporations, the government, or labor unions, donations at any level make a significant impact. In addition to foundation support, our important work is made possible through tax-deductible contributions from individual donors -- LIKE YOU.

For over 25 years, the Projec t On Government Oversight (POGO) has fought to defend the public interest against corruption and other misconduct.  We've proven that we can make a real impact on "business as usual" politics (click here to learn more about our recent accomplishments), and we will continue to work toward achieving a federal government that serves the interests of the American people.

The following are just a few examples of POGO’s plans for upcoming investigations:

• Strengthen congressional oversight by conducting monthly, bipartisan training seminars for congressional staff;
• Release an updated database on the misconduct of the government’s top 100 contractors, and publish a report with analysis and recommendations for improving taxpayer protections;
• Highlight the government’s excessive and unaccountable national security spending practices;
• Demonstrate how and why certain Inspector General offices have become weakened and politicized in recent years;
• Establish good government indicators at the state and local level by promoting a “Checklist for a Healthy Democracy;”
• Accelerate the removal of nuclear materials from Lawrence Livermore National Laboratory, which lies in the densely populated San Francisco Bay Area; and
• Expose the government’s refusal to audit multinational companies that extract oil and other precious resources from federal and Native American lands.

POGO’s investigations and reports reach millions, appearing regularly in such outlets as NBC, The New York Times, The Washington Post, Time, and National Public Radio (click here to learn more about POGO in the news). 

In order to preserve our independence, POGO does not accept any contributions from the federal government, corporations, unions, or anyone with a financial interest in the outcome of our investigations.  Because of this, individuals--like you--are the backbone of our organization, and we need your support to continue our important work.

Click here to make a tax-deductible donation to POGO. 

Thank you in advance for your support.

Contractors Expect Business As Usual If Dems Take White House

This week, Government Executive reports that the leading federal contractors are directing the bulk of their campaign contributions to the Democratic presidential contenders. Sen. Hillary Clinton currently leads the field, raising more money from the employees and political action committees of the 50 biggest federal contractors (most of which are featured in POGO’s Federal Contractor Misconduct Database) than any of the other Democratic and Republican candidates.

Now, as a reasonable person, you would think the contracting community would steer clear of a candidate who makes slashing up to half a million federal contracting positions a centerpiece of her campaign. Why, then, are contractors so keen on Hillary?

The Government Executive article quotes Stan Soloway, president of a federal contractor trade group called the Professional Services Council and longtime, ahem, friend of POGO, who dismisses her downsizing proposal as mere campaign rhetoric that doesn’t stand a chance of becoming a reality. Soloway has a point. After all, the contractors contributing to Clinton’s campaign are doing so for a multitude of reasons other than landing plum business deals with the government. Some are building on connections they established during her husband's administration. Soloway, for example, served as deputy undersecretary of Defense under Bill Clinton, whose “Reinventing Government” program was a tremendous boon for contractors. Perhaps these contractors are hopeful the other Clinton will prove equally beneficial.

-- Neil Gordon

Senate Passes Whistleblower Legislation

Last night, the Senate passed legislation by unanimous consent to strengthen the 1989 Whistleblower Protection Act. Sponsored by Sen. Akaka (D-HI), the legislation (S.274) expands protections for federal employees by removing restrictions on when and where they may disclose evidence of wrongdoing. It also helps safeguard whistleblowers’ security clearances from agency retaliation. This is especially important considering that a large number of federal jobs with historically weaker protections (e.g., the FBI and defense and intelligence agencies) require such clearances.

A similar bill (H.R. 985), sponsored by Rep. Waxman (D-CA), passed the House in March with a 331-94 vote. It’s unclear now whether the two pieces of legislation will be worked out in conference or informally. There’s a strong possibility that President Bush will veto the final bill, yet Congress could override it if votes remain the same.

-- John Pruett

Air Force CSAR-X "Rebuttal"

In response to POGO's recently issued report on the inappropriate change to a critical requirement in the combat search and rescue replacement (CSAR-X) program, the Air Force briefed members of the House Armed Services Committee on December 5, 2007.  POGO has obtained a copy of the Air Force's power point briefing (pdf) which is intended to rebut our report.

Yet even after a cursory analysis, numerous internal inconsistencies become apparent within the briefing and it confirms that the Air Force Requirements for Operational Capabilities Council (AFROCC) did not oversee the change and it never once addresses one of our primary arguments--that the requirements change was inappropriately categorized as "administrative" meaning there was a good chance it did not received the heightened attention it should have received.

For example of one of the problems with the Air Force presentation, the briefing seems to try to pin the change on Lockheed Martin, rather than Boeing.  On page 11, the Air Force quotes from a May 26, 2005, Lockheed letter to them, suggesting the 3 hour mission ready key performance parameter (KPP) be clarified to mean what the Air Force has called flight ready.

However, two things don't jibe here.  One, the Air Force admits in other slides that the KPP change occurred in the March-April 2005 or April-June 2005 time frame (depending on what slide you're on) making it appear that April is a key period not May when Lockheed sent its letter, and two, the Air Force says that "offerors"--not one offeror--requested the change for clarification.  This second point means that in addition to Lockheed either Boeing or Sikorsky said something too. 

The Air Force attempts to rule out Boeing by saying that "Boeing began discussions with the CSAR-X Program Office in June 05."  But Boeing has admitted to POGO that it was talking about its MH-47G helicopter (which the CSAR-X HH-47 is to be largely developed from) to both the Air Force Special Operations Command (AFSOC) in April 2005--responsible for the drafting of CSAR-X program requirements--and, within weeks, folks at Wright Patterson Air Force Base--the Air Force base in charge of most Air Force procurements.  AFSOC does not fly any MH-47Gs and the CSAR-X program was its only major helicopter acquisition program that would be looking at different helicopters at that time, Aviation Week's Michael Fabey reported today.  I've pasted Boeing's full email to me after the next two slides, it's after the jump--click on this link to go straight to it.

-- Nick Schwellenbach

Small Business Contracting is Vital, but Does the SBA Think So?

Small business contracting issues have been floating around Congress and many government agencies in 2007. For example, Alaska Native Corporations are under the gun about award fees paid on a non-competitive contract (pdf), which has Presidential-hopeful Senator Clinton upset. Small business contracting goals (the federal government is required to spend 23% of the total value of all prime contract dollars with legitimate small businesses) were nearly met in 2006 with $77.6 billion dollars (22.8%) (pdf) going to small contractors.  However, those numbers have been criticized for being inflated and engineered.

This week, many people are scratching their heads about the Small Business Administration’s (SBA) efforts to protect its constituents. A Federal Times story highlights possible SBA efforts “to hide the fact that large companies are getting billions of federal contracting dollars meant for small businesses.” The American Small Business League and Eagle Eye Publishing criticized SBA for removing the names of large contractors (Lockheed, SAIC, General Dynamics and many of their subsidiaries) that commonly appear on SBA’s annual “Top 100 Small Business Government Contractors” (pdf) list.  The critics argue that the agency is trying to cover up the fact that Fortune 500 companies receive a large chunk of small business contracting dollars. SBA claims that it isn’t hiding anything, but rather providing public access to small contracting data. It also asserts it can’t compare its data to data compiled by other entities because methodologies are different.

Congress is attempting (S. 2300, H.R. 1873, and H.R. 3867 [all in pdf]) to provide a level playing field for small businesses, which would likely increase competition and result in better deals for taxpayers. Those bills include anti-bundling provisions (provisions to eliminate super-sized contracts that only large contractors can bid on) as well as an annual re-certification measure that will prevent large contractors from receiving small business dollars. For example, annual re-certification (which is already required by the CCR – “You must renew your registration at least every 12 months from the date you previously registered.” [pdf, p. 6 of 22]) would provide SBA with better data and prevent the big boys from buying up a small business and receiving, for the indefinite future, the contracting benefits that are provided to that small company. Other initiatives have been discussed to prevent large contractors from miscoding goods and services to fit into specified small business categories (pdf).

Over the years, Presidential candidates and others running for political office have promoted the importance of small businesses to our economy and country. I think it’s time for someone to genuinely protect the interest of small businesses and Congress might have to lead that charge.

-- Scott Amey

OMB Launches New Spending Database

The Office of Management and Budget (OMB) today unveiled a new public database that provides a wealth of easily searchable information on federal spending in the private sector – i.e. contracts, grants, etc. The database, located at USASpending.gov, was created pursuant to the Federal Funding Accountability and Transparency Act of 2006 (31 USC 6101, PL 109-282) sponsored by Sens. Tom Coburn, Barack Obama, John McCain, and Tom Carper, and Reps. Roy Blunt and Tom Davis.

According to the 2006 Act, the free, online database must provide:

(A) the name of the entity receiving the award;

(B) the amount of the award;

(C) information on the award including transaction type, funding agency, the North American Industry Classification System code or Catalog of Federal Domestic Assistance number (where applicable), program source, and an award title descriptive of the purpose of each funding action;

(D) the location of the entity receiving the award and the primary location of performance under the award, including the city, State, congressional district, and country;

(E) a unique identifier of the entity receiving the award and of the parent entity of the recipient, should the entity be owned by another entity; and

(F) any other relevant information specified by the Office of Management and Budget.

Today, Senator Coburn lauded the OMB’s efforts to fulfill the legislation at an OMB press conference dedicated to the site’s launch. Commenting that “an informed public is a free public,” Sen. Coburn said that the site’s information would “put control of government back in the hands of the people” by providing transparency in how the government spends taxpayer dollars. Together with Sen. Coburn, Robert Shea, the OMB official in charge of creating the site, also touted the importance of bloggers in pushing for, publicizing, and making use of the OMB site’s data.

USASpending.gov was designed through a collaborative effort between the OMB and the non-profit organization OMB Watch. The latter launched a site last year, Fedspending.org, which served as the structural basis for the OMB database. An article in today’s Washington Post included the following comments from Mr. Shea and OMB Watch director Gary Bass:

They were very cooperative and supportive when they recognized we were trying to do the right thing -- even before I was paying them," Shea says of OMB Watch.

"Normally, we come to bury Caesar, not praise him," Bass says of Shea. "But they are doing something that's very cool, that's very innovative in government."

Compared to other government databases of federal spending such as the Federal Procurement Data System (FPDS), USASpending.gov provides information to the public in a more user-friendly format and will include new spending updates every 2 weeks. This is a great improvement considering that FPDS can be unwieldy at times, doesn’t include subsidiaries in company searches, and has often been slow to update information. Additionally, USASpending.gov allows users to submit recommendations for improving the site but doesn’t require users to create a login account to conduct searches.

-- John Pruett

Who's Preying on the Taxpayer?

The commentary is from a POGO friend on an Inside the Pentagon article today that leads with the following paragraph:

If the Air Force uses F-22A Raptor funding designated to shut down the production line to instead extend production past fiscal year 2009, the service would need $3.8 billion in FY-10 to fully fund a new 20-plane buy, a top service budget official tells Inside the Pentagon. 

The $3.8 billion needed to procure 20 F-22s in FY 2010 requires an additional $526 million in long-lead funding in FY 2009. That makes for a total of $4.326 billion to buy the 20 aircraft, resulting in an average unit procurement cost of $216.3 million. This compares to the $125 - 135 million average unit procurement costs alleged for the previous two lots of 20 F-22s. Am I missing something here? It’s bad enough to advocate buying a $200+ million fighter at any time but to go along with a 66% increase in unit cost in the space of one year is too much to bear. What are these guys smoking?

John Ashcroft Lands Lucrative Corporate Monitor Gig Courtesy of Former Employee

Are federal prosecutors using corporate crime prosecutions to reward cronies?

That seems to be the case in New Jersey, where U.S. Attorney Christopher Christie appointed his ex-boss, former Attorney General John Ashcroft, to be the corporate monitor of a company involved in a $311 million deferred prosecution agreement (pdf) with Christie’s office. The company in question, Zimmer Holdings, along with several other medical equipment manufacturers, was accused of paying kickbacks to get doctors to use their artificial hip and knee reconstruction and replacement products.

Ashcroft’s consulting firm, the Ashcroft Group LLC, will earn between $29 million and $52 million (paid by Zimmer Holdings) to serve as a corporate watchdog for 18 months. It will oversee Zimmer Holdings, making sure it does not engage in misconduct and helping it adopt corporate reforms. As head of the Department of Justice, Ashcroft was Christie’s boss from 2002 to 2005. Christie also served on an advisory panel that consulted regularly with the Attorney General.

Two members of the New Jersey Congressional delegation, Reps. Bill Pascrell, Jr. (D) and Frank Pallone, Jr. (D), have expressed concern over the deal and are seeking hearings on deferred prosecution agreements and the process by which corporate monitors are appointed. What particularly worries Reps. Pascrell and Pallone is the lack of transparency and oversight.

Deferred prosecution agreements (and a variant called non-prosecution agreements) are a new weapon gaining in popularity among federal prosecutors. They are starting to show up in POGO’s Federal Contractor Misconduct Database. Deferred prosecution agreements usually involve court involvement or oversight. However, the deal arranged in the Zimmer Holdings matter was crafted entirely at Christie’s discretion. The companies under investigation faced a difficult choice: either agree to Christie’s terms and pay the substantial fees charged by the monitors that he appointed, or face prosecution. Also, fee arrangements for corporate monitors are usually secret; Zimmer Holdings took the rare step of disclosing its compensation arrangement with Ashcroft in an SEC filing.

Christie said he had nothing to do with arranging Ashcroft’s fee, which he justified as a “real bargain” for taxpayers. However, Christie used the hefty monitoring fees the companies agreed to pay as an excuse not to impose any criminal fines. Is it really a “bargain” if, instead of paying back the government, companies who cheat the public are instead forced to enrich the lucky few who have connections to a U.S. Attorney?

-- Neil Gordon

NRC Sleeping on the Job?

Reposted from The Hill's Congress Blog with a few changes:

Heroes are hard to find these days. On TV, there are made-up ‘heroes’ whose deeds are wrapped up neatly before the last commercial. In real life, it never happens that way. [Ten] months ago, Kerry Beal saw something on his job site that disturbed him greatly. Beal is a security guard at the Peach Bottom Atomic Power Station in Pennsylvania. His fellow guards were sleeping on the job. He did the right thing by telling his supervisor about it.

He was told not to talk about it, shut up and be a team player. He sought the advice of a friend at church who had been a former Director of Security for Wackenhut. This friend agreed to write a letter asking the NRC to investigate the situation. Beal is a young guy with [four] children. He needed his job and simply wanted the management to do the right thing. [The NRC originally referred Mr. Beal’s allegations to Exelon, who assured the NRC everything was just fine.]

Kerry Beal knew better and so he put his family’s security at stake and video-taped 10 guards sleeping in the “ready room.” See, the plant’s security firm is Wackenhut and they allow work schedules that can run to sixty hours a week or more. Overtime is important to men who are not being paid executive-level salaries. The video became the centerpiece of a series produced by WCBS, a New York City affiliate of CBS News.

So what did the NRC and Exelon do to protect the public and institute new work rules? First, they suspended Kerry Beal and then refused to hire him back focusing on his alleged violations of procedures for videotaping the sleeping guards.

The obvious result is a good man takes the fall for irresponsible managers more concerned with their paychecks instead of a conscientious and dutiful employee and the safety of the nuclear power plant’s security. Oh, and by the way, new rules and regulations are being formulated and, according to the NRC, will be implemented in 16 months. We hope young Mr. Beal can find a job in the meantime.

-- Marthena Cowart

Webb-McCaskill Amendment Moving Forward

As of last Thursday evening, Congress appears to be taking the need for wartime contracting reform seriously. The latest House conference report for the 2008 National Defense Authorization Act (report 110-477 for HR 1585) now includes the Webb-McCaskill amendment) (Title VIII, subtitle D of the Act), which establishes an 8-member investigative commission to study contracting in Iraq and Afghanistan  and recommend changes. The amendment also expands the Special Inspector General for Iraq Reconstruction (SIGIR) and the Special Inspector General for Afghanistan Reconstruction's (SIGAR) purview to include security contracts.

In a press release issued on Friday, Senators Webb and McCaskill stated:

"I am pleased that Senator McCaskill, our freshman colleagues and I were able to move this legislation so quickly.  We've been able to create a commission that has teeth in it to bring accountability back into our wartime contracting system," said Senator Webb. "The waste, abuse and lack of oversight associated with some of these federal agency contracts are hitting the pocket-book of every American. Those of us in Congress have an obligation to the American taxpayer to be proper stewards of their tax dollars."

"We can do better, we must do better with war contracting," Senator McCaskill said. "This commission will make a difference. It will be bipartisan, it will be substantive, and it will be meaningful, and at the end of two years, we will have a very clear blueprint on how we move forward with contracting at the Department of Defense and within our military and the State Department.  As Harry Truman said during World War II, 'the men and women in the foxhole should never have to worry that people are profiting inappropriately off their sacrifice.'"

Their press release also includes an outline of the measures and a link to the audio of Friday's press conference.

The independent, bi-partisan commission would be the most substantial investigation of wartime contracting since the Truman Commission looked at spending during World War II. POGO has previously blogged on the Webb-McCaskill legislation and also sent a letter of support in September.

-- John Pruett

Rep. Wicker's Unmanned Aerial Pork

On March 22, 2007, Rep. Roger Wicker (R-MS) requested, in a letter to the chair and ranking member (pdf) of House Appropriations, an earmark for a little-known aerospace company to develop an unmanned aerial vehicle (UAV) project in his district. The company, Aurora Flight Sciences, has been growing rapidly and now looks set to expand further, in part a result of their cozy relationship with Rep. Wicker. The congressman himself may soon get a promotion as well. With the recent announcement of Sen. Trent Lott’s (R-MS) retirement at the end of the year, some speculate that Mississippi Governor Haley Barbour is likely to appoint Rep. Wicker to replace him until a special election is held next November.

The earmark in question ultimately appeared in the FY 2008 Defense Appropriations bill with support on the Senate side from Sen. Lott and Thad Cochran, according to data compiled by Taxpayers for Common Sense. Listed under Army Research, Development, Testing & Evaluation (RDT&E), it designated $6 million for Aurora’s Orion High Altitude Long Endurance UAV, which is currently under development in collaboration with Boeing’s Phantom Works office.

Additional research reveals that Rep. Wicker and Aurora have benefited each other for some time now. Aurora funded a plane flight (pdf) in 2005 for Rep. Wicker from their headquarters in Manassas, VA to Starkville, MS. Then during the 2006 elections, Aurora was the top contributor to Rep. Wicker’s campaign, giving a total of $13,000 according to Opensecrets.org. Last but not least, Rep. Wicker’s former chief-of-staff, John Keast, left the congressman’s office in 2006 to work for Cornerstone Government Affairs, where, as of August, he’s been paid $60,000 to lobby Congress on defense appropriations for Aurora.

Aurora’s Orion project began last year at Mississippi State University’s Raspet Flight Research Lab in Starkville, MS. At that time, the company also began construction of a new production facility for Orion UAVs at the Golden Triangle Regional Airport in nearby Columbus, MS. The production facility opened in May of this year and Reps. Wicker and Chip Pickering spoke at the ceremony.

Aurora has won three multi-million dollar federal contracts over the past six months, as pointed out by Rep. Wicker in an Aurora press release last month. At least two, and possibly all three, relate to the Orion project and were awarded by the Army’s Space and Missile Defense Command and the Air Force Research Laboratory.

In addition to the earmark, contracts, and production facility, Aurora has also recently expanded its high-level staff. In June of this year, Dan Brady joined the company as VP of Aerostructures. He formerly worked as a director at Vought Aircraft Industries, managing activities related to Bell and Boeing cargo aircraft (most likely the V-22 Osprey), and prior to that, Brady worked at Northrop Grumman. Last month, former Commander of US Special Operations Command (SOCOM) and Army General Bryan “Doug” Brown joined Aurora’s Board of Directors. General Brown had retired from SOCOM earlier this year.

Aurora Flight Sciences, headquartered in Manassas, VA, has facilities located in Virginia, West Virginia, Massachusetts, and Mississippi. According to their most recent contract filings with the Federal Procurement Data Service (FPDS), Aurora has 267 employees and annual revenues of $32,000,000.

-- John Pruett

Cookie Crumbles

While POGO also has “concerns regarding inherent structural and conceptual defects in the inspector general position” (though we have a sneaking suspicion our concerns may be very different) we are not weeping over Howard “Cookie” Krongard’s resignation announcement today as the Department of State’s Inspector General (IG), given the allegations raised about his leadership and conduct. 

Congressman Harry Waxman’s House Oversight and Government Reform Committee compiled a long list of examples from several current and former State Dept. IG employees about how Krongard blocked, white-washed, or repeatedly halted investigations.

Also, one would have little faith in an inspector general who claimed, under oath, in November to have no idea that his brother A.B. "Buzzy" Krongard was recently named to the Advisory Board of Blackwater Worldwide, a private security firm Krongard’s office was supposed to be investigating for human rights and contracting abuses in Iraq.

POGO has long emphasized the right balance of accountability and independence in the institution of IGs and believes in the old adage that they should be “as pure as Caesar’s wife.” Thus we find it rather odd that in his resignation letter to the White House, Krongard suggests that there is too much oversight, in that public servants such as himself are threatened by the level of “rancor and distrust” between political parties, the executive and legislative branch, the media and various interest groups.

-- Ingrid Drake