Spendthrift charge hurled again at chief US 'buyer'
Three years after a major scandal rocked the General Services Administration (GSA), that giant federal agency is charged with continuing to waste millions of dollars in tax money.
"I don't see any significant improvement," charged Howard Davia, assistant GSA inspector general for audits. The agency often ignores auditors' reports and even promotes officials who have been cited for mismanaging funds, he told a House subcommittee this week.
"The enormity of some of the so-called discrepancies suggest organized crime [involvement] is a definite possibility," he said.
The GSA is the chief procuring arm of the US government. It oversees thousands of federal buildings and buys supplies and furniture. This year it will cost taxpayers some $5 billion.
Among the new charges leveled against it:
* The GSA recently gave a $1 million-a-year rent increase to the owner fo the building that houses the Department of Transportation headquarters in Washington. The landlord, a Boston company, had asked for a total of $5 million over five years under an "escalator clause" in the rental contract. A lower-level GSA official agreed to pay the increase.
According to government auditors, GSA should have paid only a $1.7 million increase, but the GSA official failed to consult with the auditors. As a result Uncle Sam will be paying $3.3 million too much for the building.
* GSA sponsored a conference in Texas despite the fact that about half of those attending would have to travel from Washington. Among the listed expenses was $1,000 for "rented equipment." Actually, that money was spent on alcoholic beverages.
* The office of inspector general for audits double checks only about one-third of the 450 major GSA contracts a year, and this year alone it found $ 100 million in overcharges.
"There is general footdragging" in the GSA when auditors recommend reforms, said Mr. Davia. He cited a case of a regional office in New York that was criticized for overspending for construction. The regional officials shot back a two-volume response justifying the expenses and even included a poem, "The Truth or Lies" (author unknown), which implied that the auditors were not telling the truth.
Among the most common abuses, private companies frequently charge the federal government far more than they would commercial customers. When auditors examine price lists, they find that prices have been inflated. One equipment company was found to have 16 different price lists. Despite the fact that it promised that only a handful of customers paid lower prices than the government, an inspection found 1,000 customers paid less.
Davia said that former administrator Jay Solomon had made "significant efforts to correct the situation" at GSA but that he met resistance at the lower ranks (he was later replaced).
Davia told the House Subcommittee on Government Activities and Transportation April 13 that his auditing staff would have to be more than doubled before it could keep close watch on the GSA. But he added that the auditors retrieve $48 to $49 in overpayments for every $1 they cost in expenses.
Rep. John L. Burton (D) of California, who called the hearing, said he is proposing a law that would help deter contract abuse by setting a penalty for overcharging the government. Under current law contractors only must r eturn the money.