Johnson: 'I deeply regret this'

April 17, 2012 | By Molly Bernhart Walker

A widening investigation into General Services Administration conference practices now includes allegations of bribes and kickbacks, GSA Inspector General Brian Miller told a April 16 House panel.

During the hearing, convened by the House Oversight and Government Reform Committee, former GSA administrator Martha Johnson also said she apologizes to the American people for the excessive spending at a highly-publicized 2010 GSA Western Region Conference.

The spending, which was uncovered in a recent inspector general report, led Johnson to resign April 2.

"As the head of the agency I am responsible. I deeply regret this. I will mourn for the rest of my life the loss of my appointment," Johnson said.

There was no apology, however, from the person largely believed to have directly overseen more than $800,000 in spending for the lavish GSA conference.

Jeff Neely, regional commissioner of the Public Buildings Service Pacific Rim region for GSA, declined to testify April 16 and repeatedly cited his Fifth Amendment right during questioning. He was excused from the hearing.

Miller described a very "hostile environment" under Neely, where workers feared Neely would retaliate if they blew the whistle on conference spending. "When someone spoke up they were, quote according to a witness, 'squashed like a bug,'" said Miller.

The chief GSA auditor didn't elaborate on his remarks about possible bribes and kickbacks being accepted by members of the agency's Public Buildings Service. GSA acts as the federal government's chief landlord, collecting rent from federal agencies. A former GSA official said on condition of anonymity that because the service's budget doesn't come direct from congressional appropriations, some employees there have taken to seeing the rent as "their" money, not subject to the same cost-consciousness that funds explicitly from taxpayers engenders.

Johnson awarded Neely a bonus of $9,000, even after the inspector general raised red flags in preliminary findings of its investigation into the conference spending. Johnson told the committee that she wanted to see the final report before she did anything.

"As we received that interim communication, it was very clear that it was very serious and I did not want to move until I had a formal, official, complete, conclusive report," said Johnson.

In the interim she said she put a regional administrator into Region 9, establishing an immediate supervisor for Neely. He did not have a direct supervisor in the region before that. She said she also appointed new general counsel in the region and put in place some new management controls.

"But it was very important to me not to in any way interfere in a way that would upset the investigation that the inspector general was doing. Now, you have to understand, I did not think it would take nine more months to complete" the full report, said Johnson.

Johnson said many of the problems that contributed to the Region 9 scandal were due to poor leadership before she took the post.

"The leadership aspect is a pretty important part of this story," said Johnson.

There was no confirmed administrator for almost 2 years before she began as administrator, estimated Johnson. In her written testimony (.pdf), Johnson says when she took the position in February 2010, "a quarter of executive positions were empty, strategy was non-existent…governmentwide policy lacked focus and the more expensive leasing portfolio had ballooned."

She later adds that the Western Region Conference had "evolved into a raucous, extravagant, arrogant, self-congratulatory event that ultimately belittled federal workers." Johnson suggested she may not have had a clear picture of just how poor GSA oversight had become during her time away from GSA. Johnson served at GSA for 5 years under the Clinton administration.

There was a clear breakdown in the organization around oversight, she said. "Where I trusted, I needed to confront the fact that I had trusted, and I yielded this. And I resigned as a result."

"The regions had a lot of power and autonomy, and I know that Mr. Tangherlini is taking steps to have the deputy administrator take more active control and management of the regions," said Miller.

David Perera contributed to this article.

For more:
- go to the hearing page (includes prepared testimony and forthcoming archived webcast)