Questions arise over GSA chief and contracting irregularities

The head of the General Services Administration found herself embroiled in a new controversy Friday in the wake of a report that she attempted to award a no-bid $20,000 contract to a longtime friend.

A front page Washington Post story Friday reported that GSA Administrator Lurita Doan sidestepped federal laws and regulations in an effort to award a friend's public relations firm a contract to produce a 24-page report "promoting GSA's use of minority- and woman-owned businesses."

Speaking on condition of anonymity, several federal officials in GSA and other agencies said the article would damage Doan's credibility, but that the actions described would not necessarily lead to her dismissal.

A senior GSA official said Doan's attempts to issue the no-bid contact were "just stupid and boneheaded." The contract never left the agency, though, meaning no laws were broken and the action was simply "irregular," the official said.

"There are people who would like to see her go because she is rocking the boat," the official added. "The president would have to fire her and I cannot imagine that the president would fire her over these gaffes. Someone might call her in and say, 'You have to calm down a little bit.' "

Asked whether Doan's job is in jeopardy, Office of Management and Budget Deputy Director for Management Clay Johnson said, "I support Lurita Doan's efforts to make GSA more effective and efficient." He did not comment on the actions detailed in the Post story, but said "no government official is above the law, and everyone must abide by the established procurement rules and regulations."

"Those rules and regulations are constantly being reviewed to ensure they help the administration maintain the highest ethical standards," Johnson said.

According to several sources, Doan has been called in by Johnson twice to discuss the negative publicity that GSA has received recently. But several officials within GSA said the White House has more important matters to deal with and does not care enough about GSA to take the time to respond.

In letters Friday, House Oversight and Government Reform Committee Chairman Henry Waxman, D-Calif., asked Doan and two other people to produce documents and records of communications described in the Post story. The others were Edie Fraser of the Public Affairs Group Inc., the Washington public relations firm to which Doan allegedly tried to award the no-bid contract, and Alan R. Swendiman, director of the White House's Office of Administration and former GSA general counsel.

According to the Post story, Swendiman advised Doan to terminate the contract in question.

GSA said in a statement Friday that Doan has received Waxman's letter and has spoken with him. "As always, GSA will fully cooperate with Congress," the statement said.

A separate GSA statement also released Friday said Doan "takes seriously the GSA's leadership role as the premier contracting and service provider. As the longtime career attorney who reviewed this matter explained to the Washington Post, this incident has already been reviewed and no improprieties have been found."

In a statement, Senate Homeland Security and Governmental Affairs Committee Chairman Joseph Lieberman, I-Conn., said, assuming the Post's report is accurate, he would "expect the head of the agency in charge of government procurement not only to follow federal procurement regulations but to possess better judgment than she has shown."

Kevin M. Briscoe, vice president of communications for the Public Affairs Group, said the company did not exert "undue influence" in an effort to obtain the contract and was trying to highlight Doan's efforts to support women- and minority-owned businesses. "No money ever changed hands," Briscoe said. "I understand that there may have been a violation. That is out of our hands and we had no role in creating that."

Briscoe said GSA contracting officials issued a stop work order and informed company officials that they were not targets of any investigation.

The Post article Friday also referred to another controversy that sprouted in early December after reports that Doan referred to investigators at GSA's inspector general office as terrorists during a meeting and failed to support the full budget increase requested by the IG office.

An OMB official said once Doan upset her IG office, she antagonized IGs across government. "You don't go after the IGs in your own backyard without the entire community doing something about it," the official said.

Stan Soloway, president of the Professional Services Council, an Arlington, Va., contractor association, said it is unfortunate that these issues "are getting tried out in the press. There are facts in the story and a whole bunch of other facts that we do not know yet. I don't believe in a rush to judgment. We should let the process play out."

But a different GSA official said there is more to the story than has been reported, and that Doan was repeatedly warned not to sign the contract by the agency's legal counsel. "The administration doesn't need this," the official said. "You would think that they certainly have plenty of grounds to dismiss her now."

Angela Styles, a former head of procurement policy at the Office of Management and Budget who now works in the government contracting practice of the Washington law firm Miller & Chevalier, said the situation "does not look good" for Doan.

"I don't think it is ever good to have a political appointee writing contracts. Obviously, it was sole-sourced and there wasn't a justification for it," Styles said. "You can't just sign out government money to your friends."

Styles said it is not entirely clear whether Doan broke any laws. Styles said she does not think the legal issue of whether the head of an agency has procurement authority has been resolved.