Trouble brewing over final stimulus oversight language

A single word buried on Page 465 of the stimulus conference report has at least one Republican senator up in arms and some independent-government overseers scratching their heads.

Senate Finance Committee ranking member Charles Grassley, R-Iowa, is objecting to language in a heavily amended oversight section of the bill that would permit a yet-to-be named Recovery Act Accountability and Transparency Board to order any federal inspector general to "conduct or refrain from conducting an investigation or audit" into an alleged case of waste, fraud or abuse stemming from the disbursement of stimulus funds.

In the midst of late-night negotiations over the stimulus bill last week, Grassley calls the board's authority to halt investigations "dangerous," and accused Democrats of compromising the independence of agency watchdogs for political purposes.

Grassley's objections come despite an 11th-hour addition to the bill meant to underscore the autonomy of inspectors general from the board, which will be composed of at least 10 IGs and chaired by a presidential appointee.

The House-passed bill would have allowed an inspector general to protest the board's guidance regarding investigations by submitting a written dissent to the board and Congress within 30 days. The conference report added a closing line - penned by Sen. Claire McCaskill, D-Mo. -- to emphasize that "the inspector general's decision shall be final." McCaskill was unavailable for comment. Grassley called the addition as "a lot of red tape for an independent watchdog to go about doing their job."

Aides on both sides of the aisle say the White House's original structure for the accountability board, written into the House-passed bill, required a last-minute overhaul during conference negotiations after it drew broad criticism from the tight-knit IG community. In its first incarnation, the board would have been led by the government's chief performance officer, a post created by President Obama. This official would be appointed by the president and serve as a nonstatutory executive not subject to Senate confirmation. When Senate negotiators objected, one Democratic aide recalled, "There was a backroom scramble to craft language to make it workable." Subsequent versions ensured that the chairmanship would instead be held by an officer approved by Congress.

Spokesmen for several IGs said it was too early to say if the final language in the stimulus bill would tie their hands, as Grassley has alleged. Some expressed concern that the hastily amended requirements for the board provide more questions than answers. A group of IGs whose agencies are slated to receive stimulus funds are expected to meet Thursday to review the stimulus language line by line. "The independence of IGs is sacrosanct, and anything that would have a chilling effect, real or perceived, is something to be concerned about," said J. Russell George, the Treasury Department's inspector general for tax administration.