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73–825 PDF 2012

GSA’S SQUANDERING OF TAXPAYER 

DOLLARS: A PATTERN OF 

MISMANAGEMENT, EXCESS, AND WASTE 

(112–81) 

HEARING 

BEFORE THE

SUBCOMMITTEE ON 

ECONOMIC DEVELOPMENT, PUBLIC BUILDINGS, AND 

EMERGENCY MANAGEMENT 

OF THE

COMMITTEE ON 

TRANSPORTATION AND 

INFRASTRUCTURE 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED TWELFTH CONGRESS 

SECOND SESSION 

APRIL 17, 2012 

Printed for the use of the 

Committee on Transportation and Infrastructure 

( 

Available online at: http://www.gpo.gov/fdsys/browse/ 

committee.action?chamber=house&committee=transportation 

(II) 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE 

JOHN L. MICA, Florida, Chairman 

DON YOUNG, Alaska 

THOMAS E. PETRI, Wisconsin 

HOWARD COBLE, North Carolina 

JOHN J. DUNCAN, JR., Tennessee 

FRANK A. LOBIONDO, New Jersey 

GARY G. MILLER, California 

TIMOTHY V. JOHNSON, Illinois 

SAM GRAVES, Missouri 

BILL SHUSTER, Pennsylvania 

SHELLEY MOORE CAPITO, West Virginia 

JEAN SCHMIDT, Ohio 

CANDICE S. MILLER, Michigan 

DUNCAN HUNTER, California 

ANDY HARRIS, Maryland 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas 

JAIME HERRERA BEUTLER, Washington 

FRANK C. GUINTA, New Hampshire 

RANDY HULTGREN, Illinois 

LOU BARLETTA, Pennsylvania 

CHIP CRAVAACK, Minnesota 

BLAKE FARENTHOLD, Texas 

LARRY BUCSHON, Indiana 

BILLY LONG, Missouri 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

JEFFREY M. LANDRY, Louisiana 

STEVE SOUTHERLAND II, Florida 

JEFF DENHAM, California 

JAMES LANKFORD, Oklahoma 

REID J. RIBBLE, Wisconsin 

CHARLES J. ‘‘CHUCK’’ FLEISCHMANN, 

Tennessee 

NICK J. RAHALL II, West Virginia 

PETER A. DEFAZIO, Oregon 

JERRY F. COSTELLO, Illinois 

ELEANOR HOLMES NORTON, District of 

Columbia 

JERROLD NADLER, New York 

CORRINE BROWN, Florida 

BOB FILNER, California 

EDDIE BERNICE JOHNSON, Texas 

ELIJAH E. CUMMINGS, Maryland 

LEONARD L. BOSWELL, Iowa 

TIM HOLDEN, Pennsylvania 

RICK LARSEN, Washington 

MICHAEL E. CAPUANO, Massachusetts 

TIMOTHY H. BISHOP, New York 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

GRACE F. NAPOLITANO, California 

DANIEL LIPINSKI, Illinois 

MAZIE K. HIRONO, Hawaii 

JASON ALTMIRE, Pennsylvania 

TIMOTHY J. WALZ, Minnesota 

HEATH SHULER, North Carolina 

STEVE COHEN, Tennessee 

LAURA RICHARDSON, California 

ALBIO SIRES, New Jersey 

DONNA F. EDWARDS, Maryland 

SUBCOMMITTEE ON ECONOMIC DEVELOPMENT, PUBLIC BUILDINGS, AND EMERGENCY

MANAGEMENT

JEFF DENHAM, California, Chairman 

TIMOTHY V. JOHNSON, Illinois 

ERIC A. ‘‘RICK’’ CRAWFORD, Arkansas, 

Vice Chair 

RANDY HULTGREN, Illinois 

LOU BARLETTA, Pennsylvania 

BOB GIBBS, Ohio 

PATRICK MEEHAN, Pennsylvania 

RICHARD L. HANNA, New York 

CHARLES J. ‘‘CHUCK’’ FLEISCHMANN, 

Tennessee 

JOHN L. MICA, Florida (Ex Officio) 

ELEANOR HOLMES NORTON, District of 

Columbia 

HEATH SHULER, North Carolina 

MICHAEL H. MICHAUD, Maine 

RUSS CARNAHAN, Missouri 

TIMOTHY J. WALZ, Minnesota 

DONNA F. EDWARDS, Maryland 

BOB FILNER, California 

NICK J. RAHALL II, West Virginia 

(Ex Officio) 

(III) 

CONTENTS Page 

Summary of Subject Matter .................................................................................... iv 

TESTIMONY 

PANEL ONE

Hon. Brian D. Miller, Inspector General, U.S. General Services Administration ........................................................................................................................ 9 

Susan Brita, Deputy Administrator, U.S. General Services Administration ..... 9 

Alison L. Doone, Chief Financial Officer, U.S. General Services Administration ........................................................................................................................ 9 

Robert A. Peck, Former Public Buildings Service (PBS) Commissioner, U.S. 

General Services Administration ........................................................................ 9 

Lisa Daniels, Event Planner, Public Buildings Service, U.S. General Services 

Administration ..................................................................................................... 9 

PANEL TWO

Hon. Brian D. Miller, Inspector General, U.S. General Services Administration ........................................................................................................................ 82

Hon. Daniel Tangherlini, Acting Administrator, U.S. General Services Administration ................................................................................................................. 82 

Martha N. Johnson, Former Administrator, U.S. General Services Administration ................................................................................................................... 82 

David Foley, Public Buildings Service Deputy Commissioner, U.S. General 

Services Administration ...................................................................................... 82 

PREPARED STATEMENTS SUBMITTED BY MEMBERS OF CONGRESS 

Hon Elijah E. Cummings, of Maryland ................................................................. 117 

PREPARED STATEMENTS SUBMITTED BY WITNESSES 

Hon. Brian D. Miller ............................................................................................... 119 

Susan Brita .............................................................................................................. 123 

Alison L. Doone ........................................................................................................ 125 

Robert A. Peck ......................................................................................................... 127 

Lisa Daniels 1 ...........................................................................................................

Hon. Daniel Tangherlini ......................................................................................... 132 

Martha N. Johnson .................................................................................................. 141 

David Foley 1 ............................................................................................................

SUBMISSIONS FOR THE RECORD 

Hon. John L. Mica, a Representative in Congress from the State of Florida, 

request to submit list entitled, ‘‘Timeline of Investigation and Ongoing 

Travel Abuses’’ ..................................................................................................... 6 

Hon. Brian D. Miller, Inspector General, U.S. General Services Administration, request to submit report entitled, ‘‘Management Deficiency Report: 

General Services Administration Public Buildings Service 2010 Western 

Regions Conference,’’ Office of Investigations, Office of Inspector General, 

U.S. General Services Administration, April 2, 2012 ....................................... 10 

Hon. Daniel Tangherlini, Acting Administrator, U.S. General Services Administration, responses to questions from Hon. Patrick Meehan, a Representative in Congress from the State of Pennsylvania .............................................. 137 

1Lisa Daniels and David Foley did not submit written statements. 

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(1) 

GSA’S SQUANDERING OF TAXPAYER 

DOLLARS: A PATTERN OF 

MISMANAGEMENT, EXCESS, AND WASTE 

TUESDAY, APRIL 17, 2012 

HOUSE OF REPRESENTATIVES, 

SUBCOMMITTEE ON ECONOMIC DEVELOPMENT, 

PUBLIC BUILDINGS, AND EMERGENCY MANAGEMENT, 

COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE, 

Washington, DC. 

The subcommittee met, pursuant to call, at 8:35 a.m., in Room 

2167, Rayburn House Office Building, Hon. Jeff Denham (Chairman of the subcommittee) presiding. 

Mr. DENHAM. The subcommittee will come to order. At the request of the Administration, we are going to change things up a little bit this morning. We are going to have two panels today. The 

first will include the Honorable Brian Miller, GSA inspector general; Ms. Alison Doone, GSA chief financial officer. 

At this time, we are going to clear the panel during opening 

statements. Also, at this time, I ask unanimous consent that members of the Committee on Transportation and Infrastructure who 

are not on the Subcommittee on Economic Development, Public 

Buildings, and Emergency Management be permitted to sit with 

the subcommittee at today’s hearing, offer testimony, and ask questions. Without objection, so ordered. 

If you will just grab your name tags and sit in the audience for 

now, we are going to go through opening testimonies and then we 

are going to swear everybody in in a different fashion this morning, 

and then bring you up to testify yourselves. 

Two weeks ago the inspector general released a scathing report 

on a GSA conference that cost taxpayers nearly a million dollars. 

We have seen a lot of reports about the Las Vegas lavish vacation, 

the spending, and I appreciate Mr. Cummings, Ranking Member 

Cummings on the Government Oversight Committee, as well as 

Chairman Issa for discussing in great detail those lavish expenditures and the wrongdoing that happened with the Las Vegas vacation. 

The purpose of this committee is to talk about the systemic problem, how deep it goes; the corruption, the fraud, the waste. It is 

not just within the Western Region, but within GSA as a whole, 

and possibly within other agencies. 

This committee is going to lay out a timeline of how many trips, 

how many people, how much money. We are going to talk about 

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2 

tion it goes. Now, you heard yesterday the testimony of Mr. Robertson, the Chief of Staff, who is also the White House liaison, and 

was on Senator Obama’s personal staff. 

We are going to hear today from Mr. Peck, who for the last yearand-a-half I have asked, I have requested, on a bipartisan level, 

with Ms. Norton, we have sent emails, memos, held hearings, and 

asked for a budget that is outside of Congress’ purview. We have 

been held up for far too long. And I am here to tell you the buck 

stops here. We are not going to hold up any longer. The American 

public demands to see the budget on the public buildings fund, the 

Federal buildings fund, and how that money has been spent. This 

slush fund is no longer going to be used for personal uses. When 

Federal buildings, when other agencies pay rent into this personnel 

building fund, it is meant to redevelop. It is meant to sell off, which 

we have been attempting to do for the last year-and-a-half, sell off 

the properties that are unused, underutilized and redevelop, put 

people back to work where we can by utilizing these funds. 

The public has a right to know how much money is in this fund, 

where it has been used, a full accountability of the past and, most 

importantly, what is going to happen in the future. We are going 

to hear from the new administrator, Mr. Tangherlini, this morning 

about what has been done to reprimand those that have been involved. 

But again, this goes much deeper than what has already happened; those that have been fired, those that have been put on administrative leave, those that have resigned. The American public 

deserves to have money paid back. And where crimes have been 

committed, people will go to jail. And if we have to have future 

hearings on this topic, you bet we will. This is about the distrust 

of the American public in its Government. This is about the waste 

of taxpayer dollars. And if you can sense my anger and frustration, 

you should see it at home, where we have got double-digit unemployment, the highest foreclosure rate in the Nation, people out of 

work, twice the national average. And to see these types of expenditures, to see the stonewalling by this agency for the last year-anda-half hiding from the public the expenditures that have been 

made, and what has happened with this public buildings fund. 

You bet it is an outrage. And I am looking forward to full testimony this morning to get to the bottom of it. 

I am angered not only at the waste of money, but the fact that 

there would be people that the systemic issue here is that you 

would actually go out and brag about it; that you would insult the 

ranking member and former chair of this committee, who chaired 

the committee while you will were having this vacation; that you 

would laugh about our Commander in Chief and laugh about how 

you would spend this money. This goes down from the interns to 

those at the top, and it is a culture that we are going to get to the 

bottom of, and let me just issue a warning. If this continues to go 

on, if we continue to not only see this type of spending, we will continue to audit. If we continue to see that you are not giving us the 

information on a bipartisan level to show us how these expenditures are happening, I am prepared to systematically pull apart 

GSA to the point where we will make it a question to the American 

3 

public on whether GSA is needed at all. But the wasteful spending 

is going to stop, and the transparency is going to begin. 

I would now like to recognize the ranking member, Ms. Norton, 

for any opening statements she may have. 

Ms. NORTON. Thank you, Mr. Chairman. Our subcommittee has 

just returned from a scheduled recess, but we are obligated to turn 

at once to the General Services Administration inspector general 

and others today for testimony about the 2010 Western Regional 

Conference, a conference run amuck near Las Vegas, Nevada. 

The final IG report found that expenditures related to the conference were, and here I am quoting, ‘‘excessive, and wasteful, and 

that in many instances GSA followed neither Federal procurement 

laws nor its own policy in conferences.’’ End quote. 

Some who planned the conference appeared to have deliberately 

set out to have a boondoggle of a conference, and explicitly to go 

‘‘over the top’’; in the words of one conference planner, hiring mind 

readers and clowns and having dinner and a talent show in the 

desert at taxpayers’ expense. The expensive partying at a four-star 

casino resort occurred before the recovery began to take hold and 

as millions of Americans were living hand to mouth, struggling 

under debts, and the worst recession since the Great Depression. 

The emerging evidence shows that the conference had been 

building in extravagance for years, but in the last 10 years had escalated considerably. Only now is the full extent of the spending 

coming to light. Moreover, coupled with the conference scandal are 

reports by the IG of a Federal employee awards program in the 

same region with little or no controls, resulting in yet more excessive spending. 

The awards program, apparently helped feed the exorbitant conference in Nevada, providing iPods and other desirable technology 

to employees for non-work related matters. I am perhaps more 

shocked and saddened than most because I have sat on this subcommittee for more than 20 years and, by and large, have found 

GSA appointed officials and civil servants alike, including some of 

those named in the IG report, to be among the most dedicated and 

professional Federal employees. It is particularly disappointing 

that the actions of a few officials have cast a shadow over the hard 

work and professionalism of the great majority of GSA employees. 

I am grateful to the President for asking immediately to take out 

the top officials and bring in Daniel Tangherlini, a professional of 

proven management skill and impeccable ethics. 

Further, it was a political appointee of the administration who 

first alerted the IG when she saw signs of possibly excessive expenditures and employee misconduct in connection with the 2010 

conference. The result was the investigation which outlined the 

wasteful spending that is the subject of today’s hearing. 

The GSA administrator resigned, two top political appointees 

that were overseeing the Public Buildings Service were discharged, 

and the civil servants who were responsible for planning the conference were placed on administrative leave pending disciplinary 

proceedings as required by law. 

The underlying behavior was indefensible, but the system that 

was designed to identify and punish that behavior works. Work remains that may involve considerable reform and even restructuring 

4 

of the agency. I look forward to hearing from GSA officials about 

the steps they themselves believe must be taken. 

Thank you, Mr. Chairman. 

Mr. DENHAM. At this time, I would like to recognize the chairman of the full committee, Mr. Mica. 

Mr. MICA. Well, first of all, I have to thank you, Mr. Denham, 

for your leadership and for not just on this—not just on this issue 

and the outrageous matter that is before us, but from the very beginning when I had to select someone to chair this subcommittee 

that oversees public buildings, I think the country was fortunate to 

have you and your experience and leadership, and I think when we 

met our first assignment was to pick up what we had discussed we 

would do before you got here in the minority and we published this 

report. 

This report basically was October, ironically, of 2010, the same 

time that they were spending money on their GSA lavish convention. But this report is entitled ‘‘Federal Government Must Stop 

Sitting on Its Assets.’’ It is online, and I hope you all get a chance 

to read it. The first part starts right out with GSA and the abuse 

of not just millions of dollars in a convention junket, but billions 

of dollars in waste. 

This was our primer, and I couldn’t have had a better partner 

than Mr. Denham. One of the very first hearings this committee 

did, and I asked him to help lead, was in the vacant annex building 

next to the post office, vacant for almost 15 years, between that 

and the Old Post Office, losing $6 million a year. Put this in perspective. Here again, I reference this document. So this isn’t the 

Johnny-come-lately hearing or attempt to get an agency under control. 

We held the first hearing in that empty building. It was 32 degrees outside, 38 degrees inside. The picture you can see here are 

the GSA bureaucrats with their coats on because we brought them 

down to the empty building to try to get a $6 million-a-year loss, 

again two blocks from the White House, a Federal building. There 

is the empty building that we held the hearing in, and get it turned 

around, and make it a productive property. 

The Federal General Services Administration is our Government’s landlord. It is appalling to see the wasteful spending, of 

course, on this conference that Mr. Denham will outline, not just 

this conference. He is going to talk about trips to Hawaii, Atlanta, 

junkets to the South Pacific, California, Atlanta, Hawaii, Guam, 

Saipan, all at taxpayers’ expense. But that is just the tip of the iceberg. The billions that are lost, again, by having the Federal Government’s primary landlord agency out of control and not operating 

as it should and making these assets perform for the public is what 

is outrageous. 

You know, we smelled a rat, and we asked for data, because if 

you look at the budget, and the expenditures for the public buildings commissioner, they went from $2.9 million in 2007 to $9 million. That is what, 200- or 300-percent increase? So we started asking for data. We got stonewalled time and time again. Mr. Denham 

asked at almost every hearing, you heard him say, we requested 

information and data. 

5 

What we got instead, this is what we got instead, folks, just a 

few pages of the top numbers. Anyone can see now why they didn’t 

want to disclose what was going on. Ms. Norton said, and I agree, 

we have thousands of people who work for the Federal Government 

who work day in and day out and do a good job. This is not an example of the average performance of our Federal employees. We 

have some incredible men and women. 

We are going to hear from one of them today, Susan Brita. She 

worked on this committee. When you see the timeline of what took 

place, you see a timeline of coverup, a timeline of deceit, a timeline 

of keeping Congress in the dark on what was going on, you see one 

woman who stood up. This conference was held in, what, October 

10th in Las Vegas. In November she requested the IG, the Office 

of Inspector General, to look into this matter. You see yesterday, 

and our committee has legislative oversight responsibility for public hearings, and we coordinated this very well with Mr. Issa because he has broader jurisdiction over the White House and others 

that we don’t have. And you saw yesterday and in the timeline that 

the White House knew about this in June of 2011. That is great 

for the President and others to condemn the action in the last week 

or two. They have known for nearly a year of what was going on. 

And again, our former staffer not only went to the IG on this, but 

other matters, and that is detailed and I will submit this list for 

the record, Mr. Chairman, without objection. 

Mr. DENHAM. Without objection. 

[The information follows.] 

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Mr. MICA. You know, it is kind of upsetting in a way, and it 

should be upsetting to the American people that this has all been 

revealed, and maybe it wouldn’t have been revealed. It probably 

could have all been swept under the table but for one person who 

stood up, and I want to hear from her today. I hope they haven’t 

intimidated her. I hope that she feels secure, and I hope that she 

realizes that we recognize her patriotism in stepping forward and, 

again, revealing what was going on. Because otherwise, we might 

not have known. We have would been handed one sheet and said 

don’t pay attention. 

When I announced I was going to do hearings on this, I was pretty saddened by the comments of the majority leader of the U.S. 

Senate. He said Mica needs to get a life. Well, I want to tell him 

and others that I have a life, and that is dedicated to uncovering 

waste and inefficiency in Federal Government and bringing business-type commonsense practices to whether it is GSA or other 

Federal agencies. 

So we were stonewalled. We were delayed. We were not given information, but the American people need to know that this is just 

the tip of the iceberg and they will hear much more about what is 

going on and what needs to be done to reform this agency, or to 

replace it. Mr. Denham and I had a discussion last night. Maybe 

it is time to look at a total replacement. 

How many of you out there, how many of you out there, if you 

have property, would turn it over to the Federal Government to 

manage for you? I ask you that question. Not very many of you. 

And as you see the wasteful overhead and cost and what takes 

place when you are on the taxpayers’ dime, it is even more offensive. 

So with that, again, I thank Ms. Norton for her cooperation, Mr. 

Denham for his leadership, and other Members for being with us 

today. 

Mr. DENHAM. In deference to the Administration’s request, we 

will swear in those that have been fired, put on administrative 

leave, or resigned together at this time. I would like to request Ms. 

Johnson, Mr. Peck, Mr. Foley, and Ms. Daniels to please rise. 

Stand and raise your right hand and be sworn in under oath. 

[Witnesses Johnson, Peck, Foley, and Daniels sworn.] 

Mr. DENHAM. We will have two panels today. The first panel includes, and I invite you back to the table, the Honorable Brian Miller, GSA inspector general. 

Mr. MICA. Mr. Denham, Chairman Denham, I would just like to 

insert at this point in the record this comment, and note for the 

record, that Mr. Neely is not with us today. We had requested that 

he be with us. And he has, I guess, taken the Fifth in another committee and is not appearing today against one of the requests that 

at least I made for him to be with us. I guess the only way we will 

get to see him is on a video in the hot tub, so, but I want to make 

certain that it is noted in the record that he did not appear. 

Mr. DENHAM. Mr. Miller; Ms. Susan Brita, GSA deputy administrator; Ms. Alison Doone, GSA chief financial officer; Mr. Robert 

Peck, former Public Buildings Services commissioner; Mr. Neely 

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ney, has refused to appear this morning; and Ms. Lisa Daniels, the 

event planner for Public Buildings Service. 

Would you join us at the table up front. I ask unanimous consent 

that our witnesses’ full statements be included in the record. Without objection, so ordered. Since your written testimony has been 

made part of the record, the subcommittee would request that you 

limit your oral testimony to 5 minutes. And as far as this committee today, we will be going by the strict 5-minute rule. We have 

a lot of questions.This is going to be a very long hearing. We want 

to make sure that we have as many opportunities to go through 

Members’ requests as possible. 

Mr. Miller, you may proceed. 

TESTIMONY OF THE HONORABLE BRIAN D. MILLER, INSPECTOR GENERAL, U.S. GENERAL SERVICES ADMINISTRATION; 

SUSAN BRITA, DEPUTY ADMINISTRATOR, U.S. GENERAL 

SERVICES ADMINISTRATION; ALISON L. DOONE, CHIEF FINANCIAL OFFICER, U.S. GENERAL SERVICES ADMINISTRATION; ROBERT A. PECK, FORMER PUBLIC BUILDINGS SERVICE (PBS) COMMISSIONER, U.S. GENERAL SERVICES ADMINISTRATION; AND LISA DANIELS, EVENT PLANNER, PUBLIC 

BUILDINGS SERVICE, U.S. GENERAL SERVICES ADMINISTRATION 

Mr. MILLER. Good morning, Chairman Denham, Chairman Mica, 

Ranking Member Norton. Thank you for inviting me here this 

morning to testify about our report. I think everyone is familiar 

with the facts of our report. OK, and so I would simply ask that 

my written statement and the report itself be included in the 

record. I would be happy to answer any questions. Thank you. 

[The report follows. Please see the table of contents for the section entitled, ‘‘Prepared Statements Submitted by Witnesses’’ for 

Mr. Miller’s statement.] 

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Mr. DENHAM. Without objection, so ordered. Ms. Brita, you may 

proceed. 

Ms. BRITA. Good morning, Chairman Mica, Chairman Denham, 

Ranking Member Norton, thank you for inviting me to testify here 

this morning. 

Mr. DENHAM. Pull the microphone up. 

Ms. BRITA. Can you hear me now? How about this? Better? It is 

hard being on this side of the dais. As you all know, I spent 18 

years on this committee working with all of you in a bipartisan 

manner to conduct oversight on a variety of general Government 

management issues, but with an emphasis on the operations of the 

General Services Administration. 

On February 2nd, 2010, I had the honor of being appointed by 

President Obama to the position of deputy administrator at the 

General Services Administration. During my 18 years with this 

committee there were many serious issues that this committee addressed, but none rises to the level of the wasteful spending and 

lack of management associated with the Western Regions Conference. As deputy administrator, as a civil servant, and as a taxpayer, I share your anger and disappointment in GSA’s conduct. 

When I first became aware of the excessive spending related to the 

Western Regions Conference, I requested that the GSA’s Office of 

Inspector General conduct a review of these allegations. I am grateful to Mr. Miller and his office for the work that they did in uncovering and reporting these abuses. I believe the inspector general’s 

report warranted immediate corrective action within GSA, and I 

advocated for such action. I am committed to working with acting 

administrator, Mr. Tangherlini, to restore faith in the agency, not 

only to members of this committee, but also to colleagues and other 

Government agencies and more importantly to the American taxpayer. 

I look forward to answering any questions you may have. 

Ms. DOONE. Good morning, Chairman Denham, Chairman Mica, 

Ranking Member Norton, and members of the subcommittee. My 

name is Alison Doone, and I am the chief financial officer of the 

General Services Administration. I appreciate the opportunity to 

come before the committee today. 

I have served as the GSA’s CFO since September 27th, 2010. Before arriving at GSA, I served at the Internal Revenue Service for 

5 years as a CFO and deputy CFO where I oversaw the financial 

management and accounting operations for a $12 billion budget 

and $2.3 trillion in tax revenue. I also have held executive positions as deputy staff director and CFO of the Federal Election 

Commission and deputy assistant administrator at the Office of Finance at the Drug Enforcement Administration. 

Until the acting administrator’s recent action to centralize oversight financial management, GSA’s financial management operations were decentralized and were managed by autonomous regional CFOs with no oversight or control by my office. The budget 

and all costs for the Western Regions Conference were approved by 

employees in the Pacific Rim Region, including those in the regional budget and financial management division, commonly referred to as the region’s ‘‘CFO,’’ and not by anyone in the GSA office of the CFO. This decentralized organizational structure of GSA 

34 

financial operations increased the risk of these types of abuses at 

the regional conference and in the Hats Off Program. 

In my experience at IRS, and other Federal agencies, the agency 

CFO had far more oversight and control. To correct these issues, 

the acting administrator has already taken strong action by realigning all Public Buildings Service regional budget and financial 

management operations under the direct authority of GSA’s CFO. 

In addition to this strengthening of the internal control environment, the acting administrator is reviewing employee relocations, 

will require all future relocations to be approved by both the chief 

people officer and the CFO, and has closed the Pacific Region Rim 

Hats Off Store, as well as all similar programs. 

In addition to the actions taken by the acting administrator, I 

added two controls to CFO processes. First, CFO is now performing 

an additional review of selected approved invoices before payment 

to verify appropriateness of the expenditures. The second control is 

the addition of a monthly review of obligated amounts compared to 

budgeted amounts to ensure expenditures are within budget. These 

additional controls, together with centralization of budget and financial management operations, will greatly improve our ability to 

prevent the abuses described in the IG report. I welcome the opportunity to answer questions. 

Thank you. 

Mr. DENHAM. Thank you. Mr. Peck. 

Mr. PECK. Good morning, Chairman Denham, Chairman Mica, 

Ranking Member Norton, and members of the subcommittee. My 

name is Robert A. Peck. Until earlier this month, I served as the 

national commissioner of the Public Buildings Service of the GSA, 

having served in that role previously from 1995 to 2001. 

I am deeply troubled and disappointed about what I have learned 

about the costs associated with the GSA Western Regions Conference held in October of 2010. There were excessive and inappropriate costs that should never have been incurred. Those planning 

it made fundamental errors of judgment. It is also troubling that 

procurement policies, travel policies, and other agency procedures 

appear not to have been followed. 

While I was not personally involved in planning, conducting, or 

approving the conference, and the unacceptable conference expenditures described in the IG report, they took place within the PBS 

on my watch. I am not here to shirk that responsibility. 

I am deeply disappointed by what the IG reported. I have been 

removed from the job I loved, and I offer my personal apology that 

some people within the GSA acted as they did. The taxpayers deserve better than this. The actions of those responsible for the expenditures outlined in the IG report failed to meet the obligation 

we all owe the American people. Those actions failed to meet the 

standards I expected from those employed in PBS headquarters 

and throughout the regions, and those actions dishonored the thousands of hard working and dedicated Federal employees I have 

worked with over the years. 

At the GSA, and at other agencies, the Federal employees and 

managers with whom I have worked in my times both inside and 

outside the Government, have overwhelmingly been concerned with 

35 

carrying out their missions within the Government’s rules at the 

lowest costs possible. 

As PBS commissioner, I was not involved in planning conferences. As a political appointee I had a policy to not be involved 

in the selection of contractors or vendors. In the case of 2010 Western Regions Conference, it was a regionally organized event, and 

while I was invited to address the conference, I had nothing to do 

with its planning, nor was I involved in approving any part of its 

spending or program in advance. I was present for only a portion 

of the conference before returning to DC. 

As is the case with most large Federal agencies, the GSA holds 

training conferences for its employees. In my many years at the 

GSA, I attended a number of conferences. From what I personally 

saw, the conferences I attended were not extravagant. The 2010 

Western Regions Conference described in the IG’s report was a serious aberration. 

When I arrived the first afternoon of the conference I was shown 

to a very large suite. I questioned the organizers as to the cost. 

They told me that all of the rooms were within the Government 

rate, including this room, and that my suite was included at the 

basic room rate as part of the conference’s package of rooms. 

My first morning at the conference, I made a PowerPoint presentation to the entire group about national PBS goals and priorities. 

I attended presentations from the four western regions about their 

projects and performance and another about the GSA’s sustainability goals. 

That afternoon, I asked the conference organizers to invite a 

number of employees of their choosing to my room. My intention 

was to have a meet and greet with a group of regional employees 

attending the conference. This pre-dinner reception went from 

about 6:00 p.m. to 7:30 p.m. Since this was my initiative, rather 

than an event on the organizers’ agenda, I said I would pay personally for beer, wine, and chips. I was told that food would be made 

available without additional cost under the conference contract 

with the hotel. The beer and wine were purchased separately and 

upon returning to DC, I wrote a check for that cost. Only within 

the past few weeks did I learn from the GSA inspector general that 

the food for this reception was apparently invoiced at $1,960. 

It is not unusual for an IG to issue a report and Federal managers count on that as part of our internal oversight. In the normal 

course of events the IG will issue a draft report, then the agency 

will respond, and ultimately the IG will issue a final report with 

its recommendations. The IG’s recommendations, including those 

calling for any disciplinary action, are ordinarily implemented following the release of a final report. In this case, the IG issued a 

very preliminary report last May, and at that time, I understood 

that the IG cautioned the GSA not to take personnel actions until 

the final report was complete. That final report which contained 

the IG’s recommendations was just published 2 weeks ago. 

Until the IG’s draft report last year, I was not aware that there 

had been numerous planning trips incurred in connection with this 

conference. Nor was I aware until I was recently informed by the 

IG that there were questions about the competitive contracting procedures used to find the conference hotel. As I have indicated, it 

36 

is now clear that much of the expense at the hotel was excessive 

and unacceptable. Therefore, even before having the benefit of the 

final IG report, I took measures to try to ensure that something 

like this would not happen again. 

In fiscal 2011, in response to this conference, and as part of my 

focus on overhead expenses, I canceled a number of nationally controlled PBS conferences, instituted a review of PBS outside conference attendance, and took steps to reduce spending on travel. 

Further, when I was first interviewed about the conference by 

the IG last month, I invited the IG to audit other travel and conferences that PBS had conducted under my tenure. 

I deeply regret the behavior of the GSA employees involved in 

this incident and the damage that this caused. I look forward to 

answering any questions you may have. 

Mr. DENHAM. As the chairman mentioned, Mr. Neely is not with 

us today. He has used his Constitutional right to plead the Fifth 

Amendment and has hired a lawyer, nor did he testify yesterday. 

Ms. Daniels, you are next to testify. Do you have a lawyer? 

Ms. DANIELS. I do not. 

Mr. DENHAM. Can you pull the microphone, please? 

Ms. DANIELS. I do not have a lawyer. 

Mr. DENHAM. I would just issue you a word of caution. I read 

your testimony, and there is a great deal of troubling information 

on there. I would certainly issue caution today as you testify. 

Ms. Daniels, you may proceed. 

Ms. DANIELS. Good morning. This is my first time at a hearing. 

I am not—I did not prepare testimony because I was placed on administrative leave last Wednesday. All of my files were confiscated. 

I was directed to turn in all of my Government equipment and cell 

phone to the Director of HR in Fort Worth on Thursday morning. 

And on Thursday evening, my supervisor called me late in the 

evening and said that I would be receiving a letter from the House 

of Representatives requesting my testimony. As you know, I did not 

provide 100 copies by close of business. I received my letter at 

10:30 on Friday morning, and I am not clear what testimony you 

are referring to unless you are referring to interviews that I held 

with the IG, of which I didn’t sign anything, other than the Garrity 

warning, and without my files or anything—and I was not even 

sure since the title of this hearing was: ‘‘A Pattern of Mismanagement, Excess, and Waste’’—I didn’t feel comfortable without my 

computer or files to be able to even provide testimony to that subject. 

I will be happy to answer any questions. 

Mr. DENHAM. Ms. Daniels, if you don’t have prepared testimony, 

we will allow up to 5 minutes, but I was referring to your transcripts and the investigative report that the IG did. That is what 

we have gone through. We got emails as late as last night and certainly there is a great deal of concern with your transcripts. So you 

are not obligated to have an opening statement, or obligated to go 

any further than you already have, but we certainly afford you that 

right to up to 5 minutes. 

Ms. DANIELS. I will decline to provide testimony, but happy to 

answer any questions that I can. 

37 

Mr. DENHAM. Thank you. I will now recognize each Member for 

an additional 5 minutes. We will start the first round of questioning. 

Mr. Miller, I want to first start by better understanding how you 

get around rules; how you get around Executive orders; how when 

the President issues an Executive order, how members of an agency may disregard those Executive orders and figure out a way to 

get around it. 

So as my staff has put together an outline here for me, basically, 

if you get a large number of people together, in this case, Western 

Regional Conference, 300 people, it gives you a reason to have an 

offsite meeting. Now, certainly you could have a meeting in Des 

Moines, Iowa, or Modesto, California, but the whole purpose of having these lavish conferences is to go to places like Hawaii, Las 

Vegas, Palm Springs, Napa, New Orleans. That is going to be a 

good question on why the Western Regional Conference would need 

to go to New Orleans, which is not even a Western Regional Conference. 

So you get a lot of people together. It gives you a reason to have 

a conference, and then you go to a luxury resort. How much per 

diem are you supposed to get on a trip? 

Mr. MILLER. Per diem varies from place to place. And it is listed 

on the GSA Web site as to how much per diem per day individuals 

would get. For example, in Las Vegas, the per diem for breakfast 

is $12. And it is stated, there is a chart on per diem. If your question is, why did they have the conference, they—the Western Regions Conference this year, they said that they wanted to showcase 

GSA talent. 

Mr. DENHAM. Is the per diem cumulative, meaning if you pay 

your own way for the entire week you get a check at the end of 

the week? And is it you get a lunch, a breakfast, a lunch and a dinner per diem? 

Mr. MILLER. Well, you have to put a voucher in, and you would get repaid the money. It is $71 for the whole day in Las Vegas. 

That is for everything, meals and everything. The hotel room was 

$93. So a traveler would come back and submit a voucher, and that 

would be paid back to the traveler. 

Mr. DENHAM. So if you got a free room or a comp room, you could then apply for that $93 at the end of the day? 

Mr. MILLER. If you received a free room, you should not submit 

that in the voucher. If you received a free meal that the conference 

provided, you should not submit that in the voucher. 

Mr. DENHAM. And how about appetizers? 

Mr. MILLER. Well, we don’t think the appetizers were appropriate at all. We think that the appetizers were impermissible expenses. 

Mr. DENHAM. And how do you get around that rule to have appetizers? 

Mr. MILLER. There is a rule that says that if you have an awards 

ceremony and food is necessary for the performance of the awards 

ceremony, you may have food as part of the awards ceremony. That 

was routinely skirted by Region 9. 

Mr. DENHAM. How often are awards given at these conferences? 

Mr. MILLER. I would guess fairly often. They gave out—— 

38 

Mr. DENHAM. Once a conference? 

Mr. MILLER. At least. 

Mr. DENHAM. Every day of a conference? 

Mr. MILLER. I am not sure if they received an award every day. 

They had—— 

Mr. DENHAM. What type of awards? 

Mr. MILLER. Well, they received a number of things. They received souvenir coins. Everyone in the region received—— 

Mr. DENHAM. To write off a meal, to write off, to have the expense of appetizers or a full meal, whether it is sushi or a long list 

of different types of appetizers we have here, what types of awards 

would be given? 

Mr. MILLER. Well, I am not sure that any of those things would 

be appropriate at an awards ceremony. And the rule is these—food 

has to be necessary for the awards ceremony, not the other way 

around. You don’t get the food. You don’t give out an award in 

order to get the food. You are giving an award and you have a ceremony, and if incidental food is necessary for that awards ceremony, 

then it is permissible under the rules. It became kind of a running 

joke. 

Mr. DENHAM. That is how they felt it was justified. 

Mr. MILLER. Yes. 

Mr. DENHAM. To get around the Administration’s rule of not having food, they got around it by having an awards ceremony at every 

conference, or every day of a conference. 

Mr. MILLER. Many times, in Region 9, witnesses told us that it 

became a running joke with the Region 9 regional commissioner, 

that even at staff meetings, he would say we are going to have a 

meeting in another location and we are going to have food, so we 

have to do what? Senior staff is said to have said, give out awards. 

And so according to witnesses that we have interviewed, it was a 

running joke in Region 9 that in order to get food, you had to give 

out awards. And many of these awards were silly awards. One of 

our witnesses characterized them as I guess fake awards and jackass awards, and things of that nature. 

Now, getting back to the Western Regions Conference, they gave 

out awards for theatrical performances. We do not consider that a 

proper award. The award has to be for contributions to the work 

of the agency. 

Mr. DENHAM. How might they also get around the lodging per 

diem limits? How would you get a 2200-square-foot suite or several 

2200-square-foot suites? How would you get a suite at every conference? How would multiple suites be given when it is only $93? 

Mr. MILLER. Well, suites are provided by the hotel. Sometimes as 

part of the negotiation a hotel will provide an upgraded room or 

suites as part of the negotiation. They will throw in what they call 

comped rooms, if they have a number of rooms paid for by the Government, by the conference. 

Mr. DENHAM. What type of negotiation? How would you justify 

a 2200-square—how in this case would you justify two 2200- 

square-foot luxury suites? It must be some large contract. How do 

you get a contract that large? 

Mr. MILLER. Well, GSA apparently had a very large contract 

with the hotel. And the large contract with the hotel would—— 

39 

Mr. DENHAM. I am sorry, Mr. Miller, proceed. 

Mr. MILLER. With the large contract with the hotel, the hotel 

would throw in a room. And—— 

Mr. DENHAM. So how do you build up a large contract? 

Mr. MILLER. Well, GSA had a number of rooms that they were 

renting from that hotel. And—— 

Mr. DENHAM. Rooms alone would allow you to get those large 

luxury suites. 

Mr. MILLER. Well, they had catering as well. They had food. 

Mr. DENHAM. How much catering? 

Mr. MILLER. It is detailed in the report. They had receptions. 

They had light refreshments. By the way, light refreshments are 

allowed in between sessions at a conference according to the rules. 

The report identifies food expenditures. On page 9 of the report, we 

have identified $146,527 of expenditures on food and beverage catering. 

Mr. DENHAM. Let me move on. We are short on time here and 

we are going to try to stick to the 5-minute rule. If you have luxury 

suites, how would you bring your entire family and friends? How 

would you have a 21-year-old birthday party for your daughter? 

How would you have all of these various friends and family gatherings, extended stays on these different trips? 

Mr. MILLER. Well, they would have to be a gift from the hotel. 

The hotel would provide an upgraded room, or a suite, and if you 

are in the middle of negotiating a contract with the hotel, that 

might be conceived as a gift from the hotel. 

Mr. DENHAM. So let me ask you. If you set up a contract and said our per diem rate is $93, that is how much we can spend on lodging. We would like to have 5 days at $93 but we are going to spend 

several hundred thousand dollars on appetizers. We would like to 

extend our stay on the front-end and the back-end and create a 9- 

day trip out of that. And by the way, we would like 2200-squarefoot rooms so that we can bring our family and friends and throw 

a party there on the weekend. Is that possible? 

Mr. MILLER. Not under the regulations. Not under the rules. 

Mr. DENHAM. Is it possible under what you have seen in your investigation? 

Mr. MILLER. Yes. Yes. In fact, I think that does describe what 

happened. What you are talking about is essentially inappropriate 

relationships with vendors. And an inappropriate relationship with 

the hotel would be to go to the hotel and ask for favors that benefit 

the individuals personally. And all of that is improper. It is appropriate to negotiate a good rate for the food, appropriate food under 

the rules, but it is inappropriate to negotiate with vendors for personal benefits. That would—you are not allowed to use your office 

for personal gain. 

Mr. DENHAM. Nor can you accept—— 

Mr. MILLER. Correct. 

Mr. DENHAM. Many other perks were accepted here. I am out of 

time. I want to definitely go back to this a little bit deeper, but at 

this time I recognize ranking member, Ms. Norton, for 5 minutes. 

Ms. NORTON. Thank you very much, Mr. Chairman. Mr. Miller, 

what the chairman has just described, if someone in Region 9 

wanted to know whether or not what they were doing was within 

40 

the rules under the present structure, would they turn to—who 

would they turn to in Region 9? 

Mr. MILLER. Is that directed towards me? 

Ms. NORTON. Yes. Or to you or Ms. Brita. In Region 9, if what 

the chairman described, if someone wanted to know, is this within 

the rules, who would they go to to find out in Region 9? 

Mr. MILLER. They have regional counsel in Region 9, and regional counsel was consulted at least once about the possession of 

the—— 

Ms. NORTON. And what did regional counsel say? 

Mr. MILLER. I believe that regional counsel provided an opinion 

that the regional commissioner requested was not in writing, and 

if you can hold on a minute—they provided an unwritten opinion 

about bicycles, when the charity—— 

Ms. NORTON. Because there was an inquiry about the bicycles, 

but not about other things. 

Mr. MILLER. Well, the regional commissioner asked about the bicycles—— 

Ms. NORTON. Yes. 

Mr. MILLER [continuing]. Because it would involve disposal of 

Federal property. 

Ms. NORTON. Yes. Mr. Neely is not here. Did he have the final 

authority on the matters, for example, just described by the chairman, or was there someone above him who had some authority and 

to whom he reported on matters of the kind that have just been 

described? 

Mr. MILLER. Well, at the time of—— 

Mr. DENHAM. Can I clarify Ms. Norton’s point. They asked for 

legal opinion on the bicycles, correct? 

Ms. NORTON. Only. 

Mr. MILLER. Yes, they did. 

Mr. DENHAM. And what was the legal opinion? 

Mr. MILLER. The legal opinion was that if the charity maintained 

the bicycles it would not be disposal of Federal property. 

Mr. DENHAM. And was that in writing? 

Mr. MILLER. No, it was not in writing. 

Mr. DENHAM. Is it normally in writing? 

Mr. MILLER. Yes, it is. The regional commissioner requested that 

it not be in writing to avoid any obligation under FOIA. 

Mr. DENHAM. Is that in writing? 

Mr. MILLER. I believe we have—we have some evidence of that. 

I am not sure if it is a direct writing or not. But we do have evidence of that. 

Mr. DENHAM. Tried to cover it up after they made the request? 

Mr. MILLER. Well, he requested that it not be in writing. 

Mr. DENHAM. Thank you. I am sorry. 

Ms. NORTON. So the counsel himself didn’t want his opinion in 

writing? What I am trying to establish, who was the operating officer who was in charge of this conference, and whether he, in fact, 

had to report what happened in the conference, or had to ask for 

any permission, or whether he was an island unto himself who had 

control in Region 9 over the matters that we have just heard 

about? 

41 

Mr. MILLER. What we found in our investigation was that the regional commissioner essentially controlled everything, and that he 

was the final say-so. He was acting regional administrator at the 

time. There was little oversight or supervision by central office and, 

you know, as a practical matter, the regional commissioner decided—— 

Ms. NORTON. Yes, well, I am going to have—I am going to have 

questions for Mr. Tangherlini and Ms. Johnson about the structure 

of GSA, which is very troubling in this regard. I would like to ask 

Mr. Peck a question. 

Mr. Peck, there are many who have come to your defense. I have 

known you in this administration, or prior administration. And so 

it is unusual for people to publicly speak well of someone who has 

had—has encountered what you have and been discharged by the 

President. Do you understand why the President took out the top 

of the agency and do you believe that that was the right thing to 

do and the fair thing to do? 

Mr. PECK. I understand why he did it. And as I said in my testimony, I was—it was on my watch. I was brought up in a military 

family. I was an Army officer and I subscribed to the axiom that 

someone in charge is responsible for everything their organization 

does or fails to do. 

Ms. NORTON. I just want that on the record. The way in which— 

normally in this country, it doesn’t operate the way it does in parliamentary democracies, where the top resigns. Somehow in our 

country, often only people who have hands on but not direct authority are the ones held culpable. So I can understand the feelings 

for you, but in light of how structures should be structured in this 

country, I understand your response. 

There is a question, Mr. Peck, about the letter of reprimand for 

Mr. Neely. We just heard that Mr. Neely was essentially an island 

unto himself. You didn’t know anything about him. But when it became known, you believed he deserved only a letter of reprimand. 

I mean, he may be facing termination now. He may be facing criminal charges. What made you believe that what is one of the lightest 

forms of penalty, given his large responsibility, regional administrator, and commissioner, that a letter of reprimand was all that 

should take place here, especially when you say you understand 

why the President would fire you and other top officials because of 

the responsibility that the top must have for what goes on and 

those charged to him? 

Mr. DENHAM. Mr. Peck, I would allow you to answer, but I would 

ask you to be brief. 

Mr. PECK. Yes, sir. I believed it was the appropriate response at 

that time. The IG investigation was ongoing. It was my impression, 

and I think I have seen documentation since, that the IG was asking us not to take disciplinary action against anyone involved in 

this until the IG—— 

Ms. NORTON. Well, I thought it said do not take any personnel 

action, and that is a personnel action, isn’t it? 

Mr. PECK. The letter? 

Ms. NORTON. Yeah. 

42 

Mr. PECK. Well, I am not sure the letter was actually sent. There 

was a great deal of conversation about what we could and could not 

do at that time given what we knew about Mr. Neely. 

The other thing I will just note is that a lot more facts have come 

out since about what happened at that conference. But we certainly—— 

Ms. NORTON. So you still believe he deserved only a letter of reprimand? 

Mr. PECK. Oh, no. Not based on what I know now, no. 

Ms. NORTON. No, at the time, what you knew about the conference, you think he deserved no more than a letter of reprimand? 

Mr. PECK. No. At the time, we took it into account in—I took it 

into account in his rating. I spoke to him, I spoke to the other regional commissioners about conferences, I took other actions. At 

that time, given what we knew about what had happened at the 

conference, particularly with respect to him—and we didn’t know 

a lot of other things about his travel expenditures and other 

things—we thought that that was an appropriate response at that 

time. It was kind of like a shot across the bow rather than a final 

action. 

Mr. DENHAM. Thank you, Mr. Peck. 

Chairman Mica? 

And before we do, in consulting with Democrats in a bipartisan 

fashion, we have made a determination that, Ms. Daniels, after receiving a transcript over the last 48 hours, it is in our judgment 

on a bipartisan level that we will excuse you at this time. I would 

advise you, as chairman of this committee, you ought to seek legal 

counsel. You are dismissed. 

Chairman Mica? 

Mr. MICA. I thank you. 

First of all, Ms. Doone, an expenditure that rises about 300 percent for the public buildings commissioner’s expenditures, from 

$2.9 million to $9 million, does that raise any flags to you, a 300- 

percent increase? Actually, it is in about 2 years because it was 

about $3.2 million in 2009. 

Ms. DOONE. I am not sure what number you are referring to. 

Mr. MICA. The expenditures for the public building commissioner’s operations, its administrative and personnel costs. Does 

that raise any flags? 

Are you aware of a request that I have had in, our committee has 

had in, we sent it to David Foley on December 7th, 2011, to give 

us a breakdown of administrative costs? 

Ms. DOONE. I was not aware of that request, and I only became 

aware of it as the Public Buildings Service came close to finalizing 

its response. 

Mr. MICA. We have been trying to get this information since last 

year. So you are the chief financial officer. And, of course, in my 

opening statement, I described what was sent to us, and we see 

why there wasn’t much detail sent to us now. 

Mr. Miller—well, first of all, Susan Brita, you asked that—this 

conference took place in October 2010. In November, shortly thereafter, you asked for a review, IG review; is that correct? 

Ms. BRITA. Correct. 

43 

Mr. MICA. And it looks like a preliminary briefing was not done 

until May of 2011. 

All this was not made public until a few weeks ago, Mr. Miller. 

What took so long between briefing Administrator Johnson and Ms. 

Brita in May 2011? 

Mr. MILLER. Chairman Mica, we investigated a number of individuals. We interviewed individuals. We turned over every stone, 

and every time we turned over a stone we found 50 more, with all 

sorts of things crawling out from under—— 

Mr. MICA. But you never published a report. 

But in June, after providing that briefing to Ms. Brita and Administrator Johnson, somehow the GSA chief, Michael Robertson, 

yesterday who was before OGR Committee, informed Kimberly 

Harris, a White House counsel, about the investigation going on. 

Were you aware of that? 

Mr. MILLER. I was not aware of that. 

Mr. MICA. You were not aware of it. 

It was interesting that, back in May, you advised Administrator 

Johnson to get a handle on the Regional Commissioner Neely’s— 

this is May of 2011—on RC’s travel, Regional Commissioner 

Neely’s travel. Is that correct? 

Mr. MILLER. Chairman Mica, I did brief Administrator Johnson 

on the interim report—— 

Mr. MICA. But did you tell them to get a handle on his travel 

expenditures? 

Mr. MILLER. I told the regional administrator to get a handle on 

his travel in August of 2011. 

Mr. MICA. So you told him? 

Mr. MILLER. I told her. It is Ruth Cox. 

Mr. MICA. OK, Ruth Cox. OK. And then we have a trip to Hawaii, we have another trip by Neely to Hawaii in October, another 

trip to Atlanta, another—Susan Brita warned, I guess, you about 

an upcoming 17-day South Pacific junket headed by Neely? 

Mr. MILLER. Well, actually, Chairman Mica, we were so concerned about it, we contacted Ms. Brita, the deputy administrator—— 

Mr. MICA. You contacted her. 

Mr. MILLER [continuing]. And said, ‘‘Do you know that this travel 

is going on?’’ 

Mr. MICA. And, Ms. Brita, you notified the regional administrator, Ruth Cox, about the upcoming junket and expressed concern, right? 

Ms. BRITA. I did. 

Mr. MICA. Yeah. And what happened? 

Ms. BRITA. I expressed concern and asked her to review the 

plans and make sure the—— 

Mr. MICA. And that called it off, didn’t it? No. 

So they went on that junket; then another one to Dana Point, 

California; the Hawaii-Guam-Saipan trip with staff; another trip to 

Atlanta; a 4-day site visit to Hawaii. And then I guess one—where 

is Napa, this offsite trip to Napa? Is that California? You have to 

go to the wine region. 

Well, I see why Mr. Neely is not with us today and the only pictures I can get of him are in his hot-tub suite. But I thank you, 

44 

Ms. Brita, for your coming forward and for your trying to be a good 

steward of taxpayer dollars. 

I yield back. 

Mr. DENHAM. Thank you, Chairman Mica. 

Mr. Michaud? 

Mr. MICHAUD. Thank you very much, Mr. Chairman and Ranking Member, for having this very important hearing today. 

Needless to say, I was appalled when I first heard about some 

of the things that the GSA administration had charged to the taxpayers for their conference. This Congress has had its share of disagreements over the past on how to reduce the Federal spending 

and how to address the deficit issue; however, I think that we all 

can agree on that there is no place for this type of an abuse of taxpayers’ funds. 

The employees that put together this conference forgot that the 

Federal Government is supposed to work on behalf of the taxpayers. Families and small businesses throughout Maine should 

not have to pay for employees of GSA to take lavish vacations in 

Las Vegas or anywhere else throughout the country. And I hope 

that we can get the information that we need here today to make 

sure that this does not happen again. 

And, additionally, I plan to offer an amendment to the financial 

service and general Government appropriation bill to prevent GSA 

from holding this type of conference in the future. But this is just 

extremely disturbing. 

I do want to commend Ms. Brita for what you have done and are 

going to do, hopefully, with the agency. 

I guess my question is for the inspector general and Ms. Brita 

both. Since this has been brought to light in the public’s attention, 

what has been done or will be done in the future to make sure that 

this does not happen again? 

And for the inspector general, Mr. Miller, has the IG looked at 

other agencies that you are aware of for similar type of abuse that 

might have occurred or is occurring? 

Mr. MILLER. We are currently looking at all the conferences in 

Region 9. And we are looking at conferences in general. 

Mr. MICHAUD. Just Region 9? 

Mr. MILLER. No. Well, we are focusing on Region 9 right now, 

but we are generally looking at conferences. We are receiving a 

number of hotlines, as you can imagine, about other conferences 

throughout the country. 

Ms. BRITA. Mr. Michaud, Acting Administrator Tangherlini has 

committed to do a complete, top-to-bottom review of the agency, 

management structure, reporting lines, centralization versus decentralization, and with an eye, of course, to improving the management and overall service delivery of the agency. 

Mr. MICHAUD. Is the acting director also looking at making sure 

that the Federal Government is reimbursed? 

Ms. BRITA. Yes, sir. He has already taken action in that regard. 

Three letters were sent out, and additional letters will be forthcoming. Yes. 

Mr. MICHAUD. And, Mr. Miller, what do you expect or what 

should Congress do to make sure that this doesn’t happen again, 

45 

not only with GSA but other agencies, when you look at these type 

of conferences? 

Mr. MILLER. I think supporting IGs is something that helps. We 

have to investigate these frauds and abuses and waste. Unfortunately, you cannot legislate good judgment, you can’t legislate good 

management. And so I think one of the things you can do is 

strengthen inspectors general in all the agencies. 

Mr. MICHAUD. OK. Now, as far as GSA, are you understaffed in 

the inspector general’s office for GSA? And how many vacancies do 

you currently have? 

Mr. MILLER. I will leave that to the judgment of the appropriators. 

We currently have 70 special agents. They are the ones that actually interview witnesses. And I think you have read some transcripts with our special agents. We have forensic auditors that are 

trying to find all of the funds that are charged to purchase cards 

as part of this conference, charged to building operations funds, 

just trying to trace the money. So we do have forensic auditors. We 

have auditors currently who are under our FTE level and not hiring due to appropriations problems. 

Mr. MICHAUD. Could you submit to the committee the number of 

vacancies you currently have? 

Mr. MILLER. I would be happy to. 

Mr. MICHAUD. Thank you. 

I see I have run out of time. Thank you very much, Mr. Chairman. 

Mr. DENHAM. Thank you very much, Mr. Michaud. 

The vice chair of the committee, Mr. Crawford. 

Mr. CRAWFORD. Thank you, Mr. Chairman. 

Mr. Peck, what were your impressions of the $30,000 pool-party 

award ceremony where you were given an award for your work on 

the stimulus program? 

Mr. PECK. Mr. Crawford, there was a reception, I think, the 

afternoon I got there. It was outdoors at the hotel. I wasn’t aware 

of what it cost. Until reminded by the investigator, I didn’t remember what the food was because I don’t think I ate very much of it. 

Nor was I aware that there might have been an award ceremony 

there to justify food expenses. That is not something I would have 

thought of, not a rule I believe I was familiar with. 

I thought as part of a hotel package I had seen both in public 

and private sectors before that those kinds of receptions were provided as part of a hotel package. So I thought, at the end of the 

day, not knowing the expense, I didn’t think it was out of the ordinary. 

May I say one thing about the awards? 

Mr. CRAWFORD. Sure. 

Mr. PECK. If I have an opportunity, I would like to say something 

about coins. 

When I left the Government in 2001, Federal agencies did not 

give out coins. When I came back in 2009, this fad had apparently 

evolved from the military where civilian agencies had coins. Everywhere I went, somebody gave me a coin from their agency. 

There had been a coin minted for the commissioner’s office of the 

Public Buildings Service. When I was told that they were running 

46 

out and that we needed to order more, I asked how much they cost. 

They told me about $10 apiece. And I said, we don’t need coins; if 

I want to give someone an atta-boy, I can give them a handshake 

or a paper certificate. 

So that was my view. I was concerned when I saw the coins, I 

will say that. 

Mr. CRAWFORD. OK. We will get back to that in a minute. 

I am going to ask that they put up a slide of your suite. When 

you arrived at your two-story, 2,400-square-foot suite, what was 

your impression? 

Mr. PECK. That it was ludicrously large and kind of like you 

would see in Las Vegas. And I also, as I noted in my testimony, 

immediately asked what the charge was for this suite and whether 

there was an extra charge for it. 

Mr. CRAWFORD. OK. I have an email here. It is dated October 

28th. It is from you to Jeff Neely. And it states, ‘‘Jeff, that conference is unbelievable, awesome, a terrific lesson to all our folks 

about what preparation, professionalism, and a sense of perspective 

and humor can do. I just sent a rave review to Martha Johnson. 

Thanks for inviting me.’’ 

Do you want to comment on that? 

Mr. PECK. Yes, sir. At that time, I was—remember, I had arrived 

on Monday afternoon or late Monday morning. What I had seen 

were, during the presentations that I saw the 1 day I was there, 

a number of presentations that were all substantive about the work 

of the Public Buildings Service. I thought that the presentations 

prepared by the four regions were good. The conversations that I 

saw during the sessions were about the work of PBS and how we 

could get work done better. I thought that was professional, and 

that is what I was referring to. 

Mr. CRAWFORD. OK. When you decided to throw a party in your 

suite, who ended up paying for the food and alcohol, which was 

about a $2,000 bill for the food? You indicated in your testimony, 

in your written testimony as well as your oral testimony, that you 

actually paid for the alcohol. Is that correct? 

Mr. PECK. Yes, sir. Well—— 

Mr. CRAWFORD. You had bartenders and staff there for the 

party? 

Mr. PECK. No, sir. 

Mr. CRAWFORD. No? 

Mr. PECK. Not to the best of my recollection, but I don’t recall 

the—— 

Mr. CRAWFORD. OK, why would it be OK—there were no awards 

at this party. Why would it be OK to bill the taxpayers for $2,000 

worth of food at your party? 

Mr. PECK. It would not. 

Mr. CRAWFORD. So it is not OK to do that? 

Mr. PECK. No, sir. And, as I said, I specifically said, because it 

was not an award ceremony, it was not part of an official function—I had a practice when I went to meetings, whether they were 

in regional office buildings or somewhere else, of trying to meet the 

GSA employees and mostly talk shop. This thing was a pre-dinner 

thing. I thought it was a nice thing to do. And I specifically said 

47 

it was not a part of the conference program, I would pay for it myself. 

By the way, I was not prepared to pay for fancy food, and that 

is why I said, let’s do beer, wine, and chips. And then this other 

food arrived, and I said, how did that happen, and they said, well, 

it is covered in the existing conference contract. And I believe I 

said something to the effect of, so no additional cost? That is what 

I was told. I did not know that it had been charged additionally 

or separately until I was interviewed by an IG agent about, I 

guess, 4 weeks ago now when I asked him when he told me about 

the money whether that was an additional amount or was it covered by the contract. 

In any event, Mr. Crawford, I totally agree with you. I had no 

intention of charging it to the taxpayer, did not believe it was a legitimate taxpayer expense. And I yesterday sent a letter to the inspector general saying if that, in fact, was an additional cost, I am 

prepared to pay it back. 

Mr. CRAWFORD. OK, I have one quick question for Mr. Miller. 

These OIG reports are a great window into how well or poorly an 

agency is being run. Do you believe the public would be better 

served by having a central location where any citizen could access 

all the OIG reports from across the Government and be provided 

with an opportunity to learn what the OIG does, how to read the 

reports, and why they are important? 

Mr. MILLER. I think that would help. We have a Web site where 

you can access our public reports, and every IG does. There is also 

a Web site called IGnet.gov that will give you the list of all the IG 

Web sites. 

Mr. CRAWFORD. All right, thank you. 

I yield back. 

Mr. DENHAM. Thank you, Mr. Crawford. 

Mr. Walz? 

Mr. WALZ. Well, thank you, Chairman Denham and Ranking 

Member Norton. 

I would like to thank the chairman, too, for his unwavering commitment to transparency. And I have had the opportunity, along 

with Congressman Michaud, to work with Mr. Denham on the VA 

side. 

And I bring that up for a reason. Every adjective has been used 

on this, from deeply disappointed, furious, and so forth. None, to 

me, get to the heart of the matter, and I think the folks sitting 

here recognize this. It is always healthy in a democracy to be skeptical—be skeptical about Government, be skeptical about large institutions. But it is this type of behavior that moves into cynicism, 

and cynicism is cancerous. 

The American public is cynical, if you look at some of the polling, 

at rates never before seen. They don’t trust large financial institutions. They watched Wall Street go broke. They watched their taxpayer dollars bail them out. And they watched bonuses paid to 

those very people who caused the problem in the first place. And 

then the very people they expect to oversee things being done do 

this very same thing. 

And I think, as Mr. Denham said, this attack on trust is so frustrating at a time when, yes, we are all being asked to provide effiVerDate Aug 31 2005 13:48 Jul 26, 2012 Jkt 000000 PO 00000 Frm 00057 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\ED\4-17-1~1\73825.TXT JEAN
48 

ciencies and get things out of this. But I think to put this into perspective, to understand the choices that were made here, for you 

to understand, the folks who made those choices, exactly what this 

means, I would like to just talk a little bit about what it means, 

the choices we have too. 

We have an unprecedented number of veterans trying to seek 

service. And in my Sunday paper in Minneapolis this weekend, it 

talked about this. One-point-two-five million veterans were treated 

for especially mental health care. And when interviewed by this, 70 

percent of these providers said that they do not have adequate resources or space. We are asking them to do more for less on the 

very basic principle of providing mental health care for our warriors when they return. And somebody had the audacity to do this. 

It goes beyond public trust. It goes beyond a thought that how 

can we get to a point of that type of selfishness when others are 

being asked to do more with less. And it is so frustrating to me 

that this becomes—and I thank the inspector general. 

And I want to be very clear, Mr. Miller, I am an unabashed, huge 

fan of inspector generals. They return $12 for every $1 we spend 

on them. I fought for years to make sure in the VA—one of the 

most important jobs we do sitting up here is to provide oversight 

in the checks and balances. 

And amongst this whole thing, I think you brought up a very 

good point: You can’t legislate some of these poor choices that were 

made. But you know what we can do? We can put in redundancies 

and safeguards. That is the way you protect against bad judgment. 

That is the way you protect against a rogue employee or whatever 

it might be. 

I am just baffled here that the redundancies fell through. At 

some point in time, somebody is looking at this—and, Mr. Peck, 

you know this. There is no free lunch. If it is part of the contract, 

the price was jacked up. They don’t give you something free in Las 

Vegas. You could have a big suite, they know you are going to 

spend the money elsewhere. That money was spent elsewhere. 

They are not going to give that away. 

And I appreciate your attention to detail in trying to look at this. 

But at some point in time, somebody just had to recognize that, 

that it had to be. 

And your coin issue is exactly right. Members of Congress have 

to use their own money or campaign money, which is private 

money, not taxpayer money, if they are going to use coins. So I 

think you bring up a point on that. 

But how does it just get passed beyond those redundancies? So, 

Mr. Miller, I am going to come back to you for just a second. How, 

when they knew this was being done on, you know—and I don’t— 

we can pick out the things, sushi or whatever makes the highlight 

tonight or whatever, but 44 bucks for breakfast? I am a big man, 

I can’t spend 44 bucks for breakfast. Somebody had to say that. Are 

you kidding me? 

And then what it does is the American public believes every single employee and every single agency is corrupt and not doing what 

they are supposed to. And I watch those providers, those mentalhealth providers out at those CBOCs in southern Minnesota doing 

49 

the best they can with a crowded waiting room, and it is simply 

unacceptable. 

So, Mr. Miller, I think what needs to come out of this is, yes, 

somebody needs to be held accountable and, yes, ensuring it doesn’t 

happen again and that the safeguards are put into place. So how 

do we do that? How do we strengthen that? What are your suggestions going to be, if I can ask? 

Mr. MILLER. Sir, I think that we need to have stronger central 

control. I believe the new Acting Administrator Tangherlini has already instituted more centralized control of the finances so that 

each budget is not controlled by a regional commissioner or a regional administrator. I think he is working on having control over 

their IT systems, as well. 

But, as you said, redundancies, controls, checks and balances, 

those are all things that can help check the excesses, the bad judgment, the criminal activities of others. And we always rely on people to tell us when they see something wrong. And that is why Acting Administrator Tangherlini and I reminded all GSA employees 

recently to call our office if they see anything wrong, because we 

do rely on people telling us about this. And I, too, commend Susan 

Brita for bringing this to our attention. 

Mr. WALZ. Would you have caught it without her help, if I can 

end on that? Would the IG have been able to figure this out, with 

the things that are in place, without her coming forward? 

Mr. MILLER. That is a difficult question. We are told by witnesses that the culture in Region 9 was a culture that put down 

anyone that complained. Witnesses said that the regional commissioner would put people down, and the witness said, ‘‘And he knew 

how to put people down.’’ One witness said there was somebody 

who tried to raise an objection and the witness said, quote, ‘‘He 

squashed her like a bug,’’ unquote. And with that kind of an atmosphere—— 

Mr. WALZ. That is some of the most disturbing things I have 

heard, because the culture of an organization is where all of this 

starts. And if it is in there, it will continue forward. That is the 

piece that has to be changed. 

Mr. Chairman, thank you for the extra time. I yield back. 

Mr. DENHAM. Thank you, Mr. Walz. 

Mr. Barletta? 

Mr. BARLETTA. Thank you. 

I have gone through this report here, and to be honest with you, 

I don’t know where to start. I mean, we could probably spend 

weeks talking about all the abuse and the different items of abuse. 

And to be honest with you, it actually makes me sick to my stomach. So I don’t want to go there, because I think the public will 

eventually see what has happened. 

I think there is a bigger problem here. I think there is a much 

bigger problem here. Because, you see, the people back home in my 

district in Pennsylvania, they may not be able to go on one vacation this year, not one, because of the price of gas. They are hardworking, blue-collar Americans. And to look at reports where the 

GSA spent $136,000 on a scouting trip before the conference is 

more than upsetting. 

50 

And I am just fortunate that I have the opportunity to be here 

today to get some of this off my chest, but most Americans don’t 

have that chance. They won’t be able to stand here and get it off 

their chest, what they feel. In my 1 year here, I will tell you, I have 

seen more waste, fraud, and abuse in this Government, and it is 

absolutely frightening. It is frightening, the way our Federal Government works and how we treat the hardworking taxpayers’ dollars and laugh. And those videos literally make me sick. 

Mr. Peck, you said that you told someone that the food—someone 

told you that the food at your party in your suite was covered. Who 

did you tell? 

Mr. PECK. I don’t recall exactly, Mr. Barletta, but I asked—— 

Mr. BARLETTA. OK. Well, who told you that it was covered? 

Mr. PECK. One of the conference organizers. 

Mr. BARLETTA. Who was it? 

Mr. PECK. I don’t recall who it was. It may have been—— 

Mr. BARLETTA. You don’t recall who it was—— 

Mr. PECK. It may have been—excuse me—— 

Mr. BARLETTA [continuing]. You don’t recall who you told. 

Mr. PECK [continuing]. It may have been Ms. Daniels. 

Mr. BARLETTA. OK. Let’s move on. Let’s move on. Who did you 

ask about the cost of the room? 

Mr. PECK. I asked Mr. Neely. I asked at least one of the other 

people who worked on the conference. 

Mr. BARLETTA. And they told you that there was nothing wrong 

with it. Who was the other person? 

Mr. PECK. It is either Ms. Daniels or one of the other people who 

had worked on the conference. 

Mr. BARLETTA. Is this the only time that you have witnessed any 

type of abuse in the GSA? Was this conference, was this the only 

example that we could talk about today? Or were there other times 

other than this? 

Mr. PECK. As I said in my testimony, Mr. Barletta, this is the 

only conference that I am aware of in which this kind of expense, 

including pre-conference planning and all that, was out of control. 

Most of the GSA meetings and conferences I attended were focused 

on the business of the General Services Administration and trying 

to do a better job getting real estate for the Government. 

Mr. BARLETTA. This happened—and this is where I am going, 

about the bigger problem—this happened in 2010, and here we are 

in 2012 talking about it. But it didn’t end there. That wasn’t just 

a one-time deal here. Just this year, just this year, on February 

4th, the regional commissioner spent 17 days in Guam—17 days, 

this year. Who does that in the private sector? Who does that? Who 

leaves their job for 17 days? That is not the way the private sector 

works, that is not the way real people work, real companies work. 

Oh, it didn’t end there either. March 12th, there was a meeting in Napa, offsite, $40,000 for that offsite meeting. Why do we have 

to meet in Napa? 

Mr. PECK. Mr. Barletta, that is—I believe you are talking about 

the same regional commissioner. I don’t know. I was not aware of 

the meeting. 

I can tell you the senior management meetings that I held were 

mostly in regional cities, many of them held in Federal building 

51 

conference rooms. We brought in boxed lunches. When people went 

to dinner, they paid their own way. Those are the kinds of meetings, when necessary, that I believe are the right kinds of meetings 

to have. 

Mr. BARLETTA. And who reports to who? I mean, we can sit here 

and pound on Mr. Neely, as well he should be pounded on. But who 

reports to who? Who oversees who? 

I ran a company, I ran a business. And I could tell you, this 

would not have been going on. And it wouldn’t be 2 years later that 

we would just be sitting here talking about it. 

Who reports to who? Who oversees whom? Who is responsible for 

whom? And who did you report to? At what point do you blow the 

whistle, like Ms. Brita finally did? At what point do other employees in the GSA say, ‘‘This is wrong, and something needs to be 

done’’? Why are we here now trying to drag information out of people when most Americans are barely making it. 

Let me just finish this. Here is the bigger problem, and here is 

a news release. Big Government doesn’t work. It just doesn’t work. 

This is not the way the private sector works. And I think what we 

need to be talking about is, what do we do instead of the GSA? Because there is lots of abuse in the GSA, and there is lots of abuse 

in other Government agencies throughout this Government. And I 

believe the $822,000 spent in Las Vegas by the GSA should be a 

farewell party. 

Thank you. 

Mr. DENHAM. Thank you, Mr. Barletta. 

Mr. Cummings? 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. 

I want to thank you and the ranking member for your decision 

with regard to allowing the witness, Ms. Daniels, to be excused. I 

thought that was the appropriate thing to do. As a lawyer practicing for many, many years, I think it was the appropriate thing. 

I want to follow up a little bit on some of the questions that Mr. 

Walz was asking. And, Mr. Miller, we have heard these—you just 

restated something that you said yesterday before the Oversight 

and Government Reform Committee about Mr. Neely saying to one 

witness that you interviewed that she would be squashed like a 

bug. 

Let me read her entire—the statement that she made. And I 

quote, ‘‘She has been’’—this is a quote. ‘‘She has been trying to 

bring this stuff up at the board of directors meeting, and she would 

promptly get squashed like a bug when she brought up any kind 

of things concerning the conferences and the extravagances and the 

suites and, you know, the hotel suites. Because typically at a conference—I mean, the WRC was not a one-time thing where certain 

people got these very extravagant accommodations.’’ 

Does that sound familiar at all? 

Mr. MILLER. Yes, sir, it does. 

Mr. CUMMINGS. And the witness also said that, and I quote, ‘‘The 

intimidation factor is pretty large,’’ end of quote. 

Mr. Peck, let me return to you. Were you aware that Mr. Neely 

intimidated employees who reported to him? 

Mr. PECK. Mr. Cummings, I didn’t know that he intimidated employees, but I did, in fact, on more than one occasion, tell him that 

52 

I had heard that in his headquarters, as opposed to some of his 

field offices, there were people who might be reluctant to give him 

bad news because he wouldn’t take it well. 

Mr. CUMMINGS. What did you mean by that? 

Mr. PECK. I meant that I—this was hearsay. It is the kind of 

thing that, as a manager, I think you want to pick up. And I reflected it in his performance evaluation that I meant that I had 

heard there were some managers who, when people sit in a meeting and say, ‘‘Gee, I don’t think that is the way we ought to be operating.’’ 

Now, to be honest, I thought that we were talking about policy 

issues. I didn’t know we were talking about issues of real Government waste and integrity. But I—— 

Mr. CUMMINGS. OK. 

Mr. PECK [continuing]. Had heard this enough to talk about it. 

Mr. CUMMINGS. I only have a limited amount of time. I want to 

ask you some other questions. 

Did any GSA employee ever raise with you concern about Mr. 

Neely’s conduct in terms of lavish or excessive spending? 

Mr. PECK. Not that I recall, sir, no. 

Mr. CUMMINGS. Did any GSA employee ever raise with you concerns about Mr. Neely’s retaliatory actions, whether through negative performance reviews, threatening to relocate them, or other 

similar actions? 

Mr. PECK. No, sir, not to my recollection. And I am sure if I had, 

I would have taken action on it. 

Mr. CUMMINGS. This GSA employee who was squashed like a bug 

was clearly right about all the lavish spending. What does this 

mean to you if it was not retaliation? 

Mr. PECK. That—— 

Mr. CUMMINGS. In other words, somebody who felt that they had 

been squashed like a bug. 

Mr. PECK. Mr. Cummings, I am not going to—I wouldn’t split 

hairs over that. That is an intimidating atmosphere. 

Mr. CUMMINGS. And if somebody had said that to you, you would 

have taken some type of action? 

Mr. PECK. Yes, sir. 

Mr. CUMMINGS. According to the inspector general’s office, Mr. 

Neely may have spent a quarter of a million dollars on travel over 

5 years. Mr. Peck, as the head of the Public Buildings Service, did 

you track the travel expenditures of regional administrators or 

commissioners? 

Mr. PECK. Mr. Cummings, thank you for asking that. The way 

we tried to maintain managerial controls was by benchmarking the 

travel, training, information technology expenses, and other overhead expenses of one region against the others, balancing them for 

the amount of workload they had, their geographic dispersion. 

And that is what at least the PBS assistant commissioner for financial management was supposed to be tracking. I am not able 

to access the information anymore; I don’t know how it is that that 

kind of travel might have happened without showing up in that 

kind of a review. 

Mr. CUMMINGS. Well, you stated that Mr. Neely did, quote, ‘‘a 

great job for GSA over the years,’’ end of quote. You argued that 

53 

Mr. Neely should receive a positive performance rating, and you 

basically defended him. So I am having great difficulty understanding your position. 

Mr. PECK. OK. 

Mr. CUMMINGS. Let me finish. Maybe you were not aware of 

what Mr. Neely was doing or maybe you did not fully appreciate 

the level of abuse. And I agree with Mr. Walz, this is abusing people. We are better than that, we are a better country than that, 

and this is a better agency than that. 

But there is no question that Mr. Neely’s actions were inappropriate and they should have been halted. And you were his supervisor, were you not? Yes or no? 

Mr. PECK. No, sir. But I don’t want to—again, the way the GSA 

structure works, the regional commissioners do not report directly 

to the national commissioner. However, there is a very strong dotted-line authority to the PBS national commissioner. So there is 

certainly—I could exert control when I felt it necessary. 

Mr. CUMMINGS. And you were head of Public Buildings, were you 

not? 

Mr. PECK. Yes, sir. Yes, sir. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. 

Mr. DENHAM. Thank you, Mr. Cummings. 

Mr. Hultgren? 

Mr. HULTGREN. Thank you, Mr. Chairman. 

Mr. Miller, please tell me what you know about the 2010 intern 

conference in Palm Springs. I wonder if you could tell me—we have 

heard about luxury suites and catered award ceremonies. I wonder 

you can tell us a little bit about that. 

Mr. MILLER. We are currently investigating that. The intern conference occurred between May 10 and May 14, 2010, in Palm 

Springs, California. 

Mr. HULTGREN. And what do you know about it so far? 

Mr. MILLER. Well, there were 150 attendees, and we are currently in the process of investigating it. There appears to be food 

served, as well. Food is also served at that conference, and we are 

looking into the propriety of that as well as other allegations. 

Mr. HULTGREN. And, Mr. Peck, I wondered, how is it after your 

briefing by the IG in May of last year that you continue to allow 

lavish conferences to continue? 

Mr. PECK. As I testified, in fact, when I came back, after that, 

I cancelled a number of conferences. Before that even, we had 

eliminated funding for the next Western Regions Conference. I cancelled a number of other national conferences, which, by the way, 

I do not believe would have been lavish but which we still felt, 

given the budget environment, that there was not enough benefit 

given the expense that they were going to make us have. 

Mr. HULTGREN. Mr. Miller, I wonder if you could tell us a little 

bit about some of the offsite meetings in Region 9. I wonder how 

often were they having those site meetings, where would they go, 

and how much would they cost. 

Mr. MILLER. Well, the offsite meetings appeared to be fairly regular. There was an offsite meeting at Napa, I believe, at the end 

of March of 2012—that is March of this year—a PBS Region 9 offVerDate Aug 31 2005 13:48 Jul 26, 2012 Jkt 000000 PO 00000 Frm 00063 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\ED\4-17-1~1\73825.TXT JEAN
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site leadership meeting in Napa. Food is reported to be about 

$40,000 for that particular offsite. 

We are also looking into allegations regarding other offsites and 

tours, like a Jeep tour and that sort of thing, charged to the Federal Government. 

Mr. HULTGREN. Now, that one in Napa, that was just recently, 

wasn’t it? 

Mr. MILLER. In March, yes, of this year. 

Mr. HULTGREN. Thank you. 

Mr. Miller, I wonder also if the investigation that you have been 

overseeing with your Hats Off investigation revealed that more 

than $400,000 was spent in Region 9 alone for that awards program. I know you found evidence of employees exchanging awards 

with one another and supervisors getting awards from subordinates. What controls, if any, were in place to prevent this? 

Mr. MILLER. Well, the problem with Hats Off was there were 

very little controls. GSA had a policy about all of these so-called 

reward stores, and they were not being followed in Region 9. 

We did our report, we gave a draft report in May of 2011, along 

with the interim Western Regions report. Our Hats Off report became final. And in terms of providing discipline or adverse personnel action, the agency could always have taken adverse personnel action against the Region 9 regional commissioner based on 

the Hats Off award and based on other issues. And we always said, 

even with the interim Western Regions Conference report, that the 

agency should take steps to prevent further waste. They could restrict his travel, they could restrict conferences, but they didn’t. 

The only thing we said was, with respect to Western Regions, we 

were still investigating and that a technical adverse personnel action that would end up in litigation would not be a wise thing. But 

everything else was permissible, and adverse personnel action 

based on Hats Off was permissible. 

Mr. HULTGREN. I know you began your investigation largely because of a report of some stolen items. I wonder if you can tell us 

a little bit more. Were you able to locate those? What happened to 

some of those stolen items? Where and how did you find them? 

Mr. MILLER. Originally, I think around 40 items were reported 

stolen. We began the investigation. We subpoenaed Apple. We 

found that there were about 115 iPods missing. Apple provided us 

with some of the addresses where iTunes were being downloaded, 

and one of the iPods was located in Mr. Neely’s personal possession. The subpoena from Apple told us that his daughter had been 

downloading iTunes and that sort of thing. 

Ultimately, there were just so few controls and so little restrictions preventing people from even going into the store and taking 

things out that we could not tell for sure who stole what from that 

store. 

Mr. HULTGREN. My time has expired. I yield back. Thank you, 

Mr. Chairman. 

Mr. DENHAM. Thank you, Mr. Hultgren. 

Mr. Peck, my anger and frustration have finally gotten to a boiling point. February 10th, my first committee hearing. I became 

chair—was sworn into office January 5th of last year, had concerns 

about this agency. Held our first hearing February 10th, where I 

55 

first requested information from you. March 10th, 2011, requested 

it again at a hearing. May 12th, requested it a third time. October 

21st, we sent a letter, a bipartisan letter, from the committee on 

behalf of myself and Ranking Member Norton. November 4th, we 

held a hearing on the LA courthouse where we again requested the 

budget. December 7th, written request once again on the administrative costs. February 9th, we held another hearing and requested 

the PBS administrative cost information once again. March 20th, 

another written followup letter to the December 7th request. March 

20th, again we went over the administrative cost information received from the GSA and let you know how lacking that very top 

line one page was. March 22nd, had another hearing where again 

we asked for the administrative costs. And March 30th of this year, 

we had a staff meeting on the administrative costs. April 13th, we 

have now sent a letter to the new GSA director, Mr. Tangherlini. 

It has been a year-and-a-half. We have requested, we have sent 

a letter from the committee, we have demanded. Why are you hiding the information from this committee and from the American 

public? 

Mr. PECK. Mr. Chairman, I don’t—— 

Mr. DENHAM. You are not hiding it? Do you not have the information? 

Mr. PECK. Mr. Chairman, I don’t have access anymore to either 

your letters demanding information or our response. 

What I recall is that, in December, this past December, the committee asked for detailed information about overhead costs of the 

PBS nationally, the PBS headquarters in Washington, and the 

commissioner’s office. I believe we responded to that in February 

or March. There were a number of conversations, I know, that were 

had amongst my staff and the committee staff—— 

Mr. DENHAM. Were there details of these conferences? 

Mr. PECK. Sir, I don’t believe that—you know, again, not having 

access to what you requested, I don’t know if that was covered. I 

believe that the requests were for spending on things like travel 

and training—— 

Mr. DENHAM. Did you give us any information on travel and 

training? 

Mr. PECK. As I said, Mr. Chairman, I no longer have access to 

what we gave you or not, but I do—— 

Mr. DENHAM. Look—— 

Mr. PECK [continuing]. Believe we gave you an answer to the 

best of our ability on—— 

Mr. DENHAM. I don’t have the data in front of me either right 

now, but I can tell you for the last year-and-a-half I have been requesting the information. Do you not remember any of these requests? I can name them off again. I mean, but it is over a dozen 

times that I have requested and you and I have had the conversation. 

You and I had several conversations on cell phone where we have 

discussed this issue. And I have asked you, what is it going to 

take? Do you have to have a letter from the committee? Do we have 

to pass a bill, a legislation, demanding that we actually have a 

budget in place? 

56 

Mr. PECK. Mr. Chairman, I am fairly certain the agency provided 

you with information about the PBS budget we provided to the 

committees as a matter of course. I don’t know what exact demands for information you are talking about. 

Mr. DENHAM. We asked for one page. Obviously there was no information on there on this Las Vegas scandal or any of the other 

trips that were planned. And we are going to go through all of 

those trips, but several dozen trips across the Nation, lavish expenses. This is just the tip of the iceberg, but none of that information was in there. 

So the question is, if it wasn’t in there, why are you hiding it 

from us? 

Mr. PECK. Mr. Chairman—— 

Mr. DENHAM. Do you not have it? Do you not have that information? 

Mr. PECK. Mr. Chairman, I don’t have access to any information 

from GSA anymore. 

Mr. DENHAM. Anymore. Did you have information—you were the 

top guy. Did you have information that would show you the budget 

for Mr. Neely for Region 9, for the Western Regional Conference or 

all of the conferences? 

Mr. PECK. Mr. Chairman, are you referring to a specific request 

that the committee gave for information about conferences? 

Mr. DENHAM. I am trying to figure out, if you are the top guy 

at GSA, how did you not know that this was going on in the Western Region or all of the regions? 

Mr. PECK. Mr. Chairman, the allegations that I have heard so far 

today have been limited to Region 9. And we have discussed when 

and how I became aware of the expenses of the Western Regions 

Conference in October of 2010. With respect to other—— 

Mr. DENHAM. So you did not know? 

Mr. PECK. With respect to other conference spending and travel 

spending in general, we were always taking a look at what expenses were across the various regions. I was working at a level 

where I was looking at large numbers across the Nation, not at 

specific conferences. 

Except to the extent that nationally planned conferences I did 

put under review in my office, partly in response to budget restrictions and partly in response to what we learned in May of 2011 

about the Western Regions Conference. 

Mr. DENHAM. Well, you have managed to filibuster long enough 

to get through my entire time here. But let me reiterate one more 

time exactly what this committee has requested and then demanded. 

First of all, we asked for the number of employees of PBS as well 

as the number of authorized FTEs; the amount of administrative 

costs with a breakdown of how much relates to the personnel costs; 

to the extent additional staff were hired for the purposes of the 

stimulus bill, how many staff were hired, and costs associated with 

additional personnel; a breakdown of GSA-occupied space for administrative purposes, including square footage and to the extent 

space is leased and the annual lease cost; and an explanation of 

which account the employee and administrative costs are coming 

from. 

57 

We wanted a detailed budget for the last 5 years, not just about 

the Obama administration but the Bush administration as well, 5 

years of a budget. How much money has been spent, in what areas, 

in what regions—transparency for the American public. This is not 

a Republican or a Democrat issue; this is about an American issue 

of knowing what their Government is doing. 

You have certainly went through my time here, but we have 

plenty of time today. 

Mr. PECK. Mr.—— 

Mr. DENHAM. I hope you had a good breakfast, because we are 

going to have a long time to go through these. 

Mr. PECK. Mr.—— 

Mr. DENHAM. You can take as long as you want on these questions, but we are going to continue to go through them. 

Ms. Norton? 

Ms. NORTON. Mr. Miller, I think it would be important for the 

committee to know, as far as you know or perhaps Ms. Brita or 

anyone at the table may know, whether or not what we find in Region 9 has metastasized to other parts of the agency. I think it is 

fair to say that there was building up over time something of an 

abusive culture or a region apart. But we need to know whether 

this culture has spread to other parts of the GSA or whether you 

believe that it is essentially a Region 9 issue. 

Ms. BRITA. Ms. Norton, that is precisely why the acting administrator has decided, and informed this committee, to doing a top-tobottom review, so that we will be able to answer that question 

rather than just intuitively come up with an answer or speculate. 

One of the purposes for doing the top-to-bottom review will be to 

answer that question: Is this an isolated Region 9 issue or do we 

have a larger issue agencywide? And we believe that the review, 

where we are looking at all facets of GSA, will be able to answer 

that question as we move forward—— 

Ms. NORTON. Well, Mr. Miller, have you seen any evidence outside Region 9? And in light of what you see in Region 9, are you 

looking at other parts of the GSA at this time? 

Mr. MILLER. We have continuing investigations into other conferences in other districts. We are looking at at least one other conference in another district. But Region 9 employees say that spending was part of the culture in Region 9. So we do have plenty of 

evidence regarding Region 9. 

Ms. NORTON. Are you doing continuing investigations in Region 

9? 

Mr. MILLER. Yes, yes, we are, into many issues in Region 9, other 

conferences. And we are looking at other conferences outside of Region 9, as well. 

Ms. NORTON. Ms. Doone, now, your title is chief financial officer 

of the General Services Administration. The CFO for Region 9 apparently did speak up about the excessive spending. Did any of his 

concerns—I don’t know if it is a he or a she—reach your office? 

Ms. DOONE. No, they did not. 

Ms. NORTON. Well, how could you be called the CFO for the 

GSA? I don’t understand what your function is then. 

58 

Ms. DOONE. The regional CFOs in the Public Buildings Service 

report up through the regional commissioners of the Service and do 

not report to the agency chief financial officer. 

Ms. NORTON. So you never know anything about the financial 

matters in the regions? Who does know then? 

Ms. DOONE. The Public Buildings Service has a central budget 

and financial management division in their headquarters office. 

And that is the office that allocates the funds out to the various 

regions. 

Ms. NORTON. You can see the difficulty I am having—— 

Ms. DOONE. Yes. 

Ms. NORTON [continuing]. With an agency whose hierarchy, 

whose structure is very difficult to understand. Do you think that 

that is—do you believe that you were the CFO for the entire agency? What were you the CFO of? 

Ms. DOONE. Well, I believe that I was the CFO of the entire 

agency, but, unfortunately, with a decentralized financial management structure in place, it was very difficult to have the visibility 

into the financial operations—— 

Ms. NORTON. When did that happen? Has that always been the 

case, that—— 

Ms. DOONE. It has been that way for a number of years. I joined 

GSA in September of 2010, and it is my understanding that it has 

been decentralized for at least a number of years. And that is 

why—— 

Ms. NORTON. Is there a CFO at the Public Buildings Service 

then? 

Ms. DOONE. There was a position in the Public Buildings Service 

that had carried the title of CFO. And I was very concerned, actually, about this decentralization because it caused a number of 

issues when one is trying to oversee the financial operations of the 

agency. And this is one of the reasons that Acting Administrator 

Tangherlini has taken the step very quickly to recognize—— 

Ms. NORTON. This issue, Mr. Chairman, of how this agency is 

structured, it seems to me, is a major factor if we are going to look 

at how to prevent this in the future. And I have to asked Ms. Brita, 

who, apparently, the moment she understood—it must be the moment, because the conference was held in October and in early November Ms. Brita asked for a report. 

Do you think, Ms. Brita, that there would have been any way for 

you to have known or for the agency to have taken preventative action? The agency worked well with your IG when it came to action 

to penalize what had taken place, and the penalties are still rolling 

out. But, of course, the taxpayers are going to want to know, isn’t 

there anything that could have been done to prevent this problem 

in the first place? 

Ms. BRITA. As Alison said, under the decentralized structure, it 

would have been very difficult for people in central office to have 

found out. But—— 

Ms. NORTON. You then think that the—— 

Mr. DENHAM. Ms. Norton, your time is expired. 

Ms. NORTON. All right. 

You then think that the structure should be more centralized? 

59 

Ms. BRITA. Yes, I do. And the acting administrator has taken 

steps to do that already. 

Mr. DENHAM. Mr. Barletta? 

Mr. BARLETTA. Mr. Miller, you had said earlier that you thought 

that there was inappropriate behavior with vendors by employees 

of the GSA. Would ‘‘inappropriate behavior’’ mean possible criminal 

behavior? 

Mr. MILLER. Congressman, I do not want to talk about criminal 

charges. We do have a referral at the Department of Justice, and 

so I would decline to answer. 

Mr. BARLETTA. Thank you. 

Do you also believe—I mean, we are talking about this conference, and I know you said you are looking at other conferences 

around the country. But this would send a red flag that this abuse 

could be more than just conferences. Are we also looking throughout the entire agency? 

Mr. MILLER. My office does look throughout the entire agency. 

And we have had a number of important criminal prosecutions over 

the last couple of years. We sent some individuals making counterfeit goods, selling counterfeit IT products to the United States, we 

sent them to Federal prison. There was a Chief of Staff that lied 

to our agents in the FBI. We have had a number of property managers receiving bribes and kickbacks. About 11 of them were sentenced recently. 

So we have a number of criminal prosecutions. And to answer 

Congressman Walz’s question more precisely, the ultimate deterrent to this kind of behavior is criminal prosecution. 

Mr. BARLETTA. Thank you. 

I yield back, Mr. Chairman. 

Mr. DENHAM. Thank you, Mr. Barletta. 

Mr. Walz? 

Mr. WALZ. Well, thank you, Mr. Chairman. 

And I am going to come back and go on this. I am a cultural 

studies teacher by trade, so this idea of culture, all the learned and 

shared values, beliefs, and customs of a group of people, I think we 

would be very naive to not see this in other regions. 

I am deeply concerned of this decentralized accounting, which 

seems to me to go back to the heart of the lack of transparency, 

the lack of oversight, the lack of direct accountability back to it, 

which makes it much more difficult. And this culture—and just like 

the private sector, there can be healthy and unhealthy business 

practices, there can be healthy and unhealthy agencies. This one 

I am getting very concerned about. 

And I am going to segue here because—which region is Kansas 

City in? 

Mr. PECK. Six. 

Mr. WALZ. So it is a different region here. So an IG report that 

dates back to 2010, and I think I quote here, ‘‘The inspector general first accused Regional Commissioner Mary Ruwwe’s office of 

providing misleading information and doing damage to GSA’s credibility in an audit of health and safety conditions.’’ There is a concern there. And are some of you aware of what is being reported 

there? And it was again last night here on WUSA about the health 

risks that are being reported by GSA members. 

60 

And it troubles me deeply that—were they squashed like bugs, 

too, when they brought this concern forward? Because apparently 

this was a big enough concern for the commissioner there that she 

spent $234,000 of taxpayer money to get a PR firm to, I quote, ‘‘respond to questions regarding toxic substance exposure’’ instead of 

dealing with that. 

Mr. Miller, can you tell me about this? Is this out of your realm 

of responsibility? Or how familiar are you with this? 

Mr. MILLER. Sir, we wrote the report. And we did a report of the 

Bannister Federal Building in Kansas City, Missouri, at the request of Senator Bond and other Senators, Senator McCaskill, and 

Congressman Cleaver. And we did a report; we found that GSA did 

not manage the environmental risks at that facility well over the 

last 10 years. In the last year, they were taking steps to manage 

the environmental risk, but historically they did not. 

Mr. WALZ. The risks or the risks of bad PR? Because it seems 

to me they spent more money on the risks of bad PR than the environmental risks. 

Mr. MILLER. Well, that is a fair statement. Our audit report was 

on the environmental risks. 

Now, as soon as we announced our audit, they entered into a PR 

contract within 24 hours to handle PR, even though they had a PR 

staff there—— 

Mr. WALZ. Is that legal to do that? 

Mr. MILLER. In our opinion, they violated just about all the procurement rules in hiring this PR firm. 

Mr. WALZ. How long did it take them to get that contract? Because it has taken me 18 months to get the contract on the community-based outpatient clinic for southern Minnesota for our veterans. 

Mr. MILLER. They had it done within 24 hours. The CO was 

starting to do a competition, a bid, and the CO was directed not 

to do that bid. 

Mr. WALZ. So we have basically a no-bid contract for 

$234,000—— 

Mr. MILLER. Correct. 

Mr. WALZ [continuing]. To cover up—I won’t use that term; we 

will let the courts decide on that—at least to not address the issues 

that were being brought up by employees there who were trying to 

do a job—again, these are good civil servants trying to do a job who 

were exposed to toxic substance, in their opinion. 

Mr. MILLER. Well, we didn’t get into the exact—how much toxic 

substances were there. We only looked at how GSA managed the 

risk, what did GSA do when they got notice of a problem. So we 

didn’t—we are not scientists, we didn’t get into the environmental—— 

Mr. WALZ. Did you get into how, for lack of a better term, the 

whistleblowers or the affected people were treated? Were they 

squashed out? It appears to me like they were not taken seriously 

in this. 

The reason I bring this up is, I think, you know, being the cultural studies teacher, not the lawyer, it doesn’t take a great leap 

of imagination here to see this is not just Western Region. Now I 

61 

have another region that we brought in with a very similar cultural 

disinterest in their employees and a desire to have PR trump—— 

Mr. MILLER. Right. As an IG, before I make a general statement, 

I need to have facts supporting it. 

Mr. WALZ. Right. 

Mr. MILLER. We have facts in Region 9, but we do have this incident in Kansas City. We did the report. They hired the PR. There 

were hearings before Senator McCaskill’s Subcommittee on Contracting, and Senator McCaskill tried to hold them accountable. We 

noticed a number of misstatements. We informed the committee of 

that, the misstatements by GSA officials in the context of that 

hearing. 

Mr. WALZ. That is just deeply troubling again. We move at a 

snail’s pace until it is something with PR in an agency and we 

were able to issue a contract. Again, it goes back to this. We have 

crossed between healthy skepticism to cancerous cynicism and that 

doesn’t make it any better. 

So Mr. Chairman, I yield back. 

Mr. DENHAM. Thank you, Mr. Walz. I want to get down to the 

point of who reported to who, and who is accountable on these 

budgets. Ms. Brita, who did Neely report to? Everything is getting 

blamed on Neely because he has pleaded the Fifth. I want to know 

who he reported to. 

Ms. BRITA. Jeff Neely had two reporting streams. One was to the 

regional administrator, and then a separate reporting requirement 

to commissioner of the Public Buildings Service. So he had two people that he reported to. 

Mr. DENHAM. And there was no regional administrator, correct? 

Ms. BRITA. Well, Jeff Neely, at that time, Jeff Neely was acting 

in both capacities, regional administrator and as the head of the 

Public Buildings Service. 

Mr. DENHAM. So in that position who did he report to? He reported to himself on one hand and as administrator he reported to 

somebody? 

Ms. BRITA. And as acting regional administrator, he also reported to Steve Leeds, who was a senior counsel to the administrator who handled all of the regional administrators. So he had— 

Jeff reported to Bob, and then he reported to Steve Leeds. Once 

Ruth Cox was appointed as a regional administrator, he then reported to her and stopped reporting to Steve Leeds. 

Mr. DENHAM. Did you agree with that, Mr. Peck? Yes or no. 

Mr. PECK. Yes, sir. 

Mr. DENHAM. So he was a direct report? 

Mr. PECK. There is not—there is not a—in GSA’s organizational 

chart there is not a direct report between the regional commissioners to the PBS commissioner, but as I said, for all intents and 

purposes the Public Buildings Service commissioner has a lot of 

command and control over—— 

Mr. DENHAM. You signed his letter of reprimand. 

Mr. PECK. Yes, sir. 

Mr. DENHAM. And Miss Brita, you did not feel that that letter 

of reprimand went far enough? 

Ms. BRITA. That’s correct. 

62 

Mr. DENHAM. And what did you think should be done at the 

time? 

Ms. BRITA. At the time, we had not decided what would—what 

we were going to do. It was still in draft. I felt the letter was too 

weak, given what we knew already about Western Regional, as 

well as the Hats Off Program. 

Mr. DENHAM. Let me read your email. ‘‘You were not there and 

you are not in a position to judge the entirety of the conference. 

We will not be sending two separate letters if I have anything to 

do with it.’’ That was Bob Peck’s email to you. 

Ms. BRITA. That’s correct. 

Mr. DENHAM. And though he didn’t—you are saying he did not 

officially report to you, and even though you sent a letter of reprimand to him, you still recommended him to be upgraded so that 

he could receive a bonus. 

Mr. PECK. Well, I recommended—— 

Mr. DENHAM. You are under oath. And I do have the email in 

front of me. 

Mr. PECK. Yes, sir. I don’t—I don’t know what you mean by upgraded, but I did recommend a rating of 4 for his performance for 

the year, most of which was based on the performance of his region 

on business metrics that we had in place. 

Mr. DENHAM. What did the Performance Review Board recommend? 

Mr. PECK. I don’t—I thought the Performance Review Board recommended a 4 as well, but I don’t have access to that information 

anymore. 

Mr. DENHAM. Do you not chair that board? 

Ms. BRITA. Yes, Mr. Chairman. 

Mr. DENHAM. What did you recommend? 

Ms. BRITA. The rating that was reported out of the board, we recommended that his rating be held as a 3. He came in as a 3. We 

recommended that he be held as a 3. 

Mr. DENHAM. Well, let me read a separate email from Martha 

Johnson. ‘‘I spoke to Bob yesterday after the session. He is recommending a 4. Yes, on a bonus. He was also the acting RA forever 

and a day. Martha Johnson.’’ Should he have received a bonus? 

Ms. BRITA. The board did not recommend that he get a bonus. 

Mr. DENHAM. Should he have received a bonus, Mr. Peck? You 

are the one who upgraded him. 

Mr. PECK. In retrospect, no, sir. 

Mr. DENHAM. What has changed your mind today? What do you 

know now that you didn’t know a year ago when you were recommending him for a bonus? 

Mr. PECK. That principally that there were contracting irregularities in the Western Regions Conference, and a pattern of conduct 

that Mr. Neely apparently engaged in that I did not know about 

at the time. 

Mr. DENHAM. You didn’t know about it at the time. You were at 

the conference. 

Mr. PECK. No, sir. I didn’t know about the pattern of the other 

trips, the travel, the other conferences that were held in the Region 

9. That’s—that’s the difference. 

63 

Mr. DENHAM. You are the Public Buildings commissioner. When 

it comes to public buildings you are the top person. The regional— 

each of these different 11 regions report to you. You are supposed 

to be overseeing the budgets and doing an authorization—let me 

ask. I know you are going to give me a long-winded question. I only 

have so much time. Miss Doone, do you not see all of these budgets? 

Ms. DOONE. No, my office does not see those budgets for the regional commissioners. 

Mr. DENHAM. Should Mr. Peck be able to see all of those budgets? 

Ms. DOONE. Yes, he should. 

Mr. DENHAM. Is there any reason that those budgets would have 

been hidden from him? 

Ms. DOONE. I don’t know. 

Mr. DENHAM. Is there any reason that Mr. Peck should be hiding 

those budgets from this committee after requesting them over a 

dozen times? 

Ms. DOONE. Not that I know of. 

Mr. DENHAM. Is there any reason that this issue should not have 

come to light a year-and-a-half ago when the IG released his initial 

report? 

Ms. DOONE. I don’t know. 

Mr. DENHAM. I’m out of time. Mr. Cummings. 

Mr. CUMMINGS. Thank you very much, Mr. Chairman. I just 

want to follow up on the chairman’s questions. Mr. Brita—I mean, 

Mr. Peck, what is up with this? I mean, what’s happening with the 

budget? I mean, why can’t you get that information to us? And I 

know—don’t tell me that you don’t have it now. I’m talking about 

when you did have access to it. 

Mr. PECK. Mr. Cummings, the—as to the detailed questions that 

Mr.—that Chairman Denham mentioned about personnel employment and those kinds of things, I believe that we submitted that— 

that we first got a request in that detail from the committee, to my 

memory, my memory last December, and I believe we submitted it 

in late February or early March, and it had to go through—we had 

to dig out the information, get it reviewed and approved, and then 

sent it up here. I believe that was delivered. 

Mr. CUMMINGS. Now, let me go back to the questions I was asking you a few minutes ago with regard to your supervisory role 

over Mr. Neely. I think you said that you had heard some complaints about him, is that right? 

Mr. PECK. Yes, sir. 

Mr. CUMMINGS. And tell me what the nature of those complaints 

were again. 

Mr. PECK. Well, it was general and not specific, but I had heard 

that Mr. Neely in his headquarters at least was regarded as someone who you didn’t—he didn’t take well if people debated with him 

on his decisions. 

Mr. CUMMINGS. And did that concern you? 

Mr. PECK. Yes, sir, and I discussed it with Mr. Neely on more 

than one occasion. 

Mr. CUMMINGS. And so did you hear about this on more than one 

occasion? 

64 

Mr. PECK. Yes, sir. 

Mr. CUMMINGS. And did you hear about it from a number of employees, one, two, three? 

Mr. PECK. I actually heard about it more from senior management peers of Mr. Neely, than I did from employees in the region 

itself. 

Mr. CUMMINGS. And so, you know, I guess what’s bothering me 

about your role, and I have listened to your testimony very carefully, it seems as if you play down your role in all of this, but as 

the immediate supervisor, and you can call it whatever you want 

to call it, when you have got a man who has got two supervisors 

and one is himself and the other is you, as far as I’m concerned, 

you are his supervisor. It seems as if you, you know, would have 

had more hands on Mr. Neely. And I just—and you know, my 

mother used to—who was a former sharecropper, used to say, son, 

you can have motion, commotion, and emotion, and no results. And 

I don’t want these hearings to be, you know, very emotional, and 

then we don’t get results. And so I’m trying to get to what happened here. I’m wondering if somebody, the structure was one 

which the person in your position should have had more authority 

and should have had access to more information, or whether you 

didn’t do your job; whether you failed to overlook Mr. Neely. Then 

I wondered, too, whether you felt intimidated by Mr. Neely. Because obviously, he had a reign of threats going on around him, 

and so I just—help me with this. I mean, if you had to restructure 

that relationship, that is, the Neely position and your position, I 

mean, how would you restructure that? Because Mr. Tangherlini is 

trying to make sense of this, and I know he is going to do a great 

job. So—but help him. He is watching you. So tell him what—give 

him your suggestions. 

Mr. PECK. Mr. Cummings, before I left the agency I was discussing with Miss Doone and with former Administrator Johnson 

doing what Mr. Tangherlini is doing, which is providing more direct control from the central office over the financial operations of 

the regions. That’s one. Two, I would have the regional commissioners unequivocally report directly to the PBS national commissioner. I was focused a lot on the business metrics for each of the 

regions, including how much space the Government was occupying, 

how much we were spending on leasing, and we were working very 

hard to get those numbers down because they are in the billions 

of dollars, and they can exercise real savings—— 

Mr. CUMMINGS. So as far as these conferences were concerned, 

you would have it so that you had absolutely nothing to say about 

that, a person in your position? 

Mr. PECK. Unless someone brought something to my attention 

and I thought that there was something out of line, I would not 

generally be supervising where and when regional conferences 

were happening. 

Mr. CUMMINGS. Very well. I mean, as I listen to you, I think that 

you made it sound like you played a very lightweight role in this, 

and sir, I must tell you, I think that you played a major role and 

I am sure we will get to the bottom of it at some point. 

With that I yield back. 

65 

Mr. DENHAM. Thank you, Mr. Cummings. Mr. Peck I’m going to 

remind you not only that you are under oath, but that this has already been referred to the Department of Justice. There are criminal issues at hand here. And to play this lightly, that everything 

is Mr. Neely’s fault, certainly I think has this entire committee 

puzzled. I want to just bring back those emails that I was talking 

about. The emails from you to Miss Brita, July of last year, the 

whole bonus, November 5th of last year, an IG report, which came 

out in May of last year. This is an internal report. The conference 

happened in 2010. Miss Brita very bravely stepped forward and 

brought this attention to the IG. The IG did a preliminary report, 

issued that report back to Mr. Miller. 

Who did you submit this report to? 

Mr. MILLER. Administrator Johnson. 

Mr. DENHAM. And who did the administrator give it to? 

Mr. MILLER. Well, Miss Brita as well, and I’m not sure who she 

gave it to. I don’t know the exact nature of the list, but I believe 

she gave it to Mr. Peck and—— 

Mr. DENHAM. Mr. Peck, did you receive a copy of this? 

Mr. PECK. I’m sorry. Could you say again what it is? 

Mr. DENHAM. Did you receive a copy of the Western Regions Conference ‘‘OIG Interim Alert Report on Investigation Into Potential 

Fraud, Waste, and Abuse.’’ 

Mr. PECK. I did, yes, sir. 

Mr. DENHAM. And did you receive it in a timely fashion, somewhere around May of last year? 

Mr. PECK. Yes, sir. 

Mr. DENHAM. This gets to a bigger question of the culture in 

GSA. If somebody stepped forward, a whistleblower stepped forward and alerted the IG to an issue, and the IG came back and 

issued a report on investigation into potential fraud, waste, and 

abuse, why then would you have a dispute with Miss Brita and 

Martha Johnson and recommend somebody to get a bonus at the 

end of the year? 

Mr. PECK. Mr. Chairman, as I described, the bonus system is 

based on a number of performance metrics. And I was looking at 

the performance of the region with respect to its major real estate 

responsibilities as well as Mr. Neely’s problems with the conference. But I will say again, as I said in my testimony—— 

Mr. DENHAM. This is 20 pages long with quite a bit of detail. And 

you told Susan Brita, ‘‘You were not there. You are not in a position to judge the entirety of the conference. We will not be sending 

two separate letters if I have anything to do with it.’’ 

She sits on the committee. She recommended a 3, no bonus. You 

came back, and sent an email to Martha Johnson, or Martha Johnson sent an email to Susan Brita. ‘‘I spoke to Bob yesterday after 

the session. He is recommending a 4. Yes on a bonus. He was also 

the acting RA forever and a day.’’ 

There are criminal issues at stake here. This is all in this report 

that you had a copy of a year ago, that you read, that Mr. Neely 

had a copy of and he read, and still continued to take many other 

trips, which we are going to get into greater detail here shortly, 

many other trips with other criminal issues involved, and you felt 

66 

that it was important to go against committee staff and upgrade 

him and give him a bonus. 

That is a culture within an agency that shows no matter what 

investigative report is going on, no matter what information or details we have, we are going to operate business as usual. So I don’t 

think that you can sit here and blame everything on Mr. Neely 

when you are the one who recommended him for a raise after giving him a letter of reprimand. 

Do you have a response? 

Mr. PECK. Mr. Chairman, as I said, I take responsibility for everything that happened on my watch. As I said, I was focused on 

performance among the regions on a lot of the metrics, things that 

you and I discussed about reducing the amount of space the Government occupies, trying to do a better job, getting real estate—— 

Mr. DENHAM. In this report. 

Mr. PECK. Excuse me, sir, and but I understand—what I knew 

at the time in that report, I believe it deserved him being graded 

down to a 4 because on performance metrics alone he might have 

got—he would have gotten a higher number, so we were grading 

him down to a number and then we had a conversation about 

whether it should be a 3 or a 4, yes, sir. 

Mr. DENHAM. In this report, I’m going to go through one page of 

it before I turn this back over to Ms. Norton. The preplanning 

meetings, the dry runs. Again, this goes to the overall culture of 

these expensive trips. Back in 2009, March 9th through 11th, was 

the first planning trip with free stays at Caesars Palace for several 

attendees. March 30th through 31st, 2009, 13 attendees at the 

Ritz-Carlton and M Resort. August 17th through the 19th, 2009, 

other attendees, $6,000 cost. November 4th through 6th, the M Resort, 65 attendees. March 8th through 12th, 15 attendees, back at 

the M Resort. June 30th through July 2nd, 8 attendees. And August 17th through 19th, 20 attendees. And on several of these trips 

Mr. Neely not only approved, approved all of them, but on several 

of these trips Mr. Neely went and brought his family and friends 

as well. 

Many of these trips I should verify—I don’t know if all of these 

trips included suites, the very large 2200-square-foot room that you 

and Mr. Neely, separate hotel rooms, but you and Mr. Neely both 

enjoyed. And then October 12th through 15th, 31 attendees, including Mr. Neely. Nine trips before this lavish conference. This is part 

of this that was in this report that you saw; that you shared with 

Mr. Neely. You gave a copy to Mr. Neely, this official inside document, showed him what he did. You knew of it, and then you still 

went against Ms. Brita’s recommendation—the Commission’s recommendation and gave him a bonus and upgraded him from to 3 

to a 4. How can you blame all of this on Mr. Neely when you were 

the one who approved it? 

Mr. PECK. Mr. Chairman, I’m not saying that—as I made clear, 

I thought that Mr. Neely’s actions were wrong. I thought the conference went—was clearly excessive. 

Mr. DENHAM. I am not going to continue to beat up on the conference. I think that Mr. Cummings and Mr. Issa did a very good 

job talking about the Las Vegas conference yesterday. This is about 

67 

the overall culture and you were the man that was in charge of the 

public buildings area which allowed all of these different trips. 

Now, we are going to go into many other trips that GSA has gone 

through, but the Public Buildings Fund has been used not only on 

these nine trips, but the lavish Las Vegas vacation and Napa and 

everything else that was on your watch that not only the Western 

Region did, but every other region. 

Miss Norton. 

Ms. NORTON. This question is not only for Mr. Peck. I have to 

ask all of you sitting at the table, because you all live with this system. This puzzled us yesterday at the Government Reform hearing. 

I sit on that committee as well. This notion about performance and 

conduct sounds very, very bureaucratic, but I can tell you one 

thing, that nobody in the real world, I don’t think in the private 

sector even, would separate out conduct and performance so that 

one could, in fact, be seen as an excellent performer or a good performer while engaged in conduct that the agency frowned on. 

So you have to make me understand where the system comes 

from, if it is peculiar to GSA, and whether you think it is defensible. I would like to go right across the board. Do you think it is 

a defensible system to bifurcate performance and conduct? 

Mr. PECK. No. And I think some of—some of the ways in which 

there are impediments to—in personnel management and in conducting discipline—have something to do with this, by which I 

mean this: That there are on the one hand, as every civil servant 

should have, the right to fair play, the right to due process in disciplinary action. But it is sometimes a very cumbersome practice, 

and what one is able to do and not to do is not clear, and I think 

that that gets in the way of mixing the two. 

Ms. NORTON. Well, I have got to ask Mr. Miller. Mr. Miller, you 

are an inspector general. Is this system found across the Government where performance and conduct are on two separate tracks? 

Mr. MILLER. No, I don’t—I don’t believe—well, first of all, I’m not 

an expert in personnel law, but I don’t believe that that distinction 

makes sense. If someone brought in a lot of leases, but they did it 

through stealing, that is still a bad performance. You can’t separate 

out the two. And you know, the fact of the matter is that Mr. Neely 

got a performance award of $9,000, and he got a special act award. 

Ms. NORTON. It does seem to me that civil service, which is supposed to keep favoritism out of the picture, this almost encourages 

favoritism because you can always say, and I’m not assuming that 

that happened here, you can say well, this is based on one factor 

or the other. And of course, it runs counter to everything you teach 

a child. It runs counter to how the President handled this situation. Mr. Peck and Miss Johnson have extraordinary performance 

records in the Federal Government, but the conduct of the employees under them was laid to them, and so the President decided, it 

seemed to me appropriately, that he could not bifurcate even their 

years of excellent performance. 

Now, Ms. Brita, you have been in the Government a long time. 

You were I think Chief of Staff, or very high in the General Services Administration before your record there brought you to the 

Congress. You have been brought back as a political appointee. Did 

you see this in the agency when you were there before? Mr. Miller 

68 

didn’t know of any such bifurcation elsewhere, and given your— 

given your time in the agency, I would like your view of the performance versus conduct way of viewing one’s employees, and 

where it came from. 

Ms. BRITA. Well, Miss Norton, I can tell you what we did on our 

performance board, not only most recently, but certainly in the 

mid-1980s, when I was there. Performance and conduct were always considered—— 

Ms. NORTON. There were no separate tracks in the 1980s. 

Ms. BRITA. Performance is a bedrock. Everyone has to perform, 

so that is a—you must consider performance, but overlaying that 

is always the overall conduct. 

Ms. NORTON. So you don’t know when this bifurcation took place. 

Ms. BRITA. No, but when you are evaluating the SES conduct as 

well as performance has to be a part of the overall evaluation. 

Ms. NORTON. If one is looking for one way, one remedy, it would 

certainly be that. 

Could I ask you, Mr. Miller, in light of what you testified about 

the aura of retaliation, and the rest, whether you found that there 

was any obstruction to your own investigation. 

Mr. MILLER. We are looking into all sorts of leads. We currently—we did not find any outright obstruction yet. 

Ms. NORTON. In fact, you were able to put quite a bit on the 

record, it does seem to me. 

Mr. MILLER. Yeah, well, we were able to investigate and write 

this report and publish it without obstruction. 

Ms. NORTON. Thank you very much. And thank you, Mr. Chairman. 

Mr. DENHAM. Let’s go to slide 13. Mr. Miller, we talked about the 

17-day trip to the South Pacific in February 2012; this February, 

a couple of months ago. So in the last couple of years, Mr. Neely 

has taken many trips to Napa, several trips on the planning missions to Las Vegas. It all came out in your IG report of May last 

year. Miss Brita downgraded him on her committee. Mr. Peck went 

ahead and gave him a bonus anyways. And then your new report 

came out, which I have got to hand it to you, this report was pretty 

detailed. This would have been several, I think, committee hearings just in having your initial report a year ago. So your new report comes out. Now it is all hands on deck. 

Mr. MILLER. Yes. 

Mr. DENHAM. Everybody in GSA knows, apparently, because we 

have handed this report out. We have seen Members hand this report out to many people beyond Martha Johnson. The Administration is now aware of it. And then several other trips happened, including this trip, a 17-day trip to the South Pacific, to Hawaii, 

Honolulu, Guam, Saipan, in an internal email trying to justify it. 

But here is the personal email at the bottom where his wife asks 

about the schedule. He tells her it is going to be a birthday present 

for her. They are excited about the party. What can you tell us 

about this trip? Was it justified? 

Mr. MILLER. Well, we were concerned about the trip. That’s why 

we brought it up with the deputy administrator, Susan Brita. She 

then brought it up with the regional administrator. 

69 

Mr. DENHAM. Miss Brita, did you bring that up to the regional 

administrator? 

Ms. BRITA. Yes, sir, I did. 

Mr. DENHAM. Which was who? 

Ms. BRITA. Ruth Cox. She is the regional administrator. 

Mr. DENHAM. Mr. Peck know about it? 

Ms. BRITA. I don’t know if Ruth called Bob or not. I know I spoke 

directly to her. 

Mr. DENHAM. Martha Johnson know about it? 

Ms. BRITA. I don’t believe I mentioned it to Martha. I think I just 

called Ruth directly. 

Mr. DENHAM. OK, so you had concern about this. Obviously, this 

has gone on for well over a year-and-a-half. We have got two IG 

reports out now. Still at this point nobody has been fired. Nobody 

has been put on administrative leave. Nobody has resigned. 

A year-and-a-half more of lavish spending, lavish trips. This trips 

happens. You once again are put in a position where—and you 

have already been a whistleblower. I mean, I think you did your 

job. I think you did your job by going to the IG in the first place 

to say hold on a second, I think we have a problem here. Now, I 

mean, I congratulate you on that. I think most people would have 

stopped there. And then this continued to go on for the next yearand-a-half, and you brought it to a number of different people’s attention, that this trip shouldn’t go on. 

And Mr. Miller, you also made a recommendation. What was 

your recommendation? 

Mr. MILLER. Well, we were concerned that this was an unnecessary trip and a waste of money. You saw the email. He says it is 

a birthday gift for his wife. They quote the song, it is your party, 

we are going to party like your party—you have read the emails. 

We were very concerned about this. We were concerned about the 

performance award that was given, $9,000. There was a special act 

award of $3,000. 

Mr. DENHAM. And have you investigated this trip and the expenses associated with this trip? 

Mr. MILLER. We are currently investigating them, yes. 

Mr. DENHAM. And you have not provided any of that investigation to this committee yet, have you, other than the emails that directly correspond to it? 

Mr. MILLER. We provided the emails, yes. 

Mr. DENHAM. You don’t have the expenses associated with that 

trip? 

Mr. MILLER. I’m not sure that we provided that yet. We are still 

working on all of the expenses and working in conjunction with the 

Department of Justice. 

Mr. DENHAM. Did Mrs. Neely or Mr. Neely pay for the expense 

of a spouse travel? 

Mr. MILLER. If you hold on, I will check with staff. 

1We have no evidence at this time that the Government paid for 

Mrs. Neely. 

Mr. DENHAM. How often does this happen that you can take a 

family, you can throw a 21st birthday party for your kids in these 

suites? How often does it happen that you have family travel, you 

70 

have friends travel, you have these expensive suites on the taxpayers’ dime? 

Mr. MILLER. It seems like they have it backwards. They have to 

have a legitimate business reason. If it is necessary to travel to accomplish your goals—— 

Mr. DENHAM. Would a 1-hour ribbon cutting justify a 7- to 9-day 

trip? 

Mr. MILLER. Not in my opinion. 

Mr. DENHAM. But in some opinion in the GSA it happens. 

Mr. MILLER. Well, apparently it happened. I can’t see how anyone can condone that, but—— 

Mr. DENHAM. Thank you. Mr. Walz. 

Mr. WALZ. I yield back my time to you, Mr. Chairman. 

Mr. MILLER. They have it backwards. If you have to travel, it is 

permissible if a family member stays in your hotel room and you 

pay for that family member’s travel apart from that. That’s OK. 

But to plan travel for a birthday is totally impermissible. 

Mr. DENHAM. In one of these lavish suites, one of these 2200- 

square-foot rooms that Mr. Peck and Mr. Neely each had, there 

was a 21st birthday party thrown for family and friends. Can you 

discuss what you found in that issue? 

Mr. MILLER. As I recall, there was a 21st birthday of a family 

member of one of the event planners for PBS. And the Location 

Solvers, I believe, according to testimony, the Location Solvers 

found a hotel in Las Vegas for that family member and the party, 

and kind of helped arrange the party, and that they had a party 

in Las Vegas and they got special room rates arranged by the Location Solvers. Is that the event you were referring to? 

Mr. DENHAM. Yes. 

Mr. MILLER. OK. 

Mr. DENHAM. That was one of the nine trips prior to the Las 

Vegas vacation. 

Mr. MILLER. That was a separate trip. There were nine trips, 

and I guess planning for the Western Regions Conference. And 

there were—maybe you are thinking of—they stayed on an extra 

day and tried to get the special Government rate that was not 

available for the loft suite, and they tried to get that special rate. 

Ultimately, they could not get the special rate, and they charged 

the balance to the Federal Government. 

Mr. DENHAM. That was the $1,000, roughly $1,000. 

Mr. MILLER. Yes, roughly that. 

Mr. DENHAM. So the Government paid for the room? 

Mr. MILLER. Yes. 

Mr. DENHAM. GSA is the landlord of all of our public buildings. 

Is there any reason that GSA, all agencies of Government, is there 

any lack of space that we have right now that would not allow all 

agencies of Government to hold some type of conference in a public 

building? 

Mr. MILLER. I think there is plenty of space in public buildings 

to have conferences. This particular conference was to showcase 

talent, theatrical talent as well as other talent of the GSA employees. You can draw your own opinion as to whether it was necessary 

in the first place. 

71 

Mr. DENHAM. Miss Doone, we have been asking for the financial 

information and administrative cost data since last year. Obviously, you can see my frustration. It does seem like GSA has been 

stonewalling us for quite some time. Why has it taken so long to 

get this basic information? 

Ms. DOONE. I can’t answer that, but I can tell you that we have 

your most recent request, your most recent letter that you sent to 

Acting Administrator Tangherlini, and my office is working on that 

answer. 

Mr. DENHAM. Is there a reason that we have a 200-percent increase in the PBS commissioner’s budget. 

Ms. DOONE. I can’t answer that question because I don’t have the 

numbers that you are referring to. 

Mr. DENHAM. Has there been an increase in the PBS budget? 

Ms. DOONE. Yes, there has been. 

Mr. DENHAM. How big, in your estimation? 

Ms. DOONE. It has gone up—it has gone up over the past several 

years, and as a result of an increase in FTE, as well as cost in utilities and fuels in the administrative cost area that you are referring 

to. 

Mr. DENHAM. Traveling conference budget gone up? 

Ms. DOONE. I do not know. 

Mr. DENHAM. How do you not know? 

Ms. DOONE. Because that information is managed at the level— 

at the Public Buildings Service level. 

Mr. DENHAM. It is not managed. Mr. Peck is unaware of it as 

well. Does GSA have the authority to remove funds from the Federal Buildings Fund? 

Ms. DOONE. The money stays within the Federal Buildings Fund. 

Mr. DENHAM. Does GSA have the authority to move money from 

the Public Buildings Fund? 

Ms. DOONE. Not that I’m aware of. 

Mr. DENHAM.What is your relationship with the regional CFOs 

and how are you ensuring that their authority is not undermined 

at the regional level? 

Ms. DOONE. I had no authority with the regional CFOs until Acting Administrator Tangherlini realigned that relationship. 

Mr. DENHAM. You have been there for a while though. Did you 

not have a relationship before? 

Ms. DOONE. No. 

Mr. DENHAM. So this is a new procedure that is being put in 

place—— 

Ms. DOONE. Yes, that is correct. 

Mr. DENHAM. Mr. Miller, did you learn from your investigation 

how a regional office can go so far over budget without anyone 

holding them accountable? 

Mr. MILLER. Yes, I think Region 9 is a good example of that. And 

if I could just correct something for the record. The special act 

award to Mr. Neely was $2,000 this year, not 3 that I said. And 

the performance award was $9,000. 

Mr. DENHAM. Thank you. Miss Norton. 

Ms. NORTON. I have been—Mr. Neely apparently figures as a 

central character in this drama. I have been trying to figure out 

how he became so powerful, if I may use that word. 

72 

Mr. Neely is not a political appointee, is that correct? Is Mr. 

Neely a political appointee? 

Mr. MILLER. No, he is career SES. 

Ms. NORTON. So this is a career civil servant, not a political appointee who was acting regional administrator for a very long time. 

I believe 30 months. Could I ask you, Mr. Miller, you, Miss Brita, 

in playing the role of regional administrator for all intents and purposes and PBS commissioner, in effect was Mr. Neely reporting 

from one level as himself to another level as himself with no reporting above him? 

Mr. MILLER. When he was acting regional administrator, he, as 

regional commissioner of PBS in one sense would report to himself 

as acting regional administrator. Theoretically, the PBS regional 

commissioner would report to the central office PBS commissioner, 

and to the deputy administrator and the administrator. 

Ms. NORTON. So he was reporting in his commissioner roll up 

through a something of a chain of command to Mr. Peck? 

Mr. MILLER. Yes. 

Ms. NORTON. In his acting regional administration role, he was 

doing what? 

Ms. BRITA. He was reporting to Steve Leeds, who was the senior 

counsel to the administrator. He—— 

Ms. NORTON. Which is like reporting to the administrator? 

Ms. BRITA. Well, he was directly reporting to Steve Leeds, 

and—— 

Ms. NORTON. No, I am trying to establish whether he had a 

chain of command. 

Ms. BRITA. And Steve reported to the administrator, correct, yes. 

Ms. NORTON. What did that lead to? Were there reports up to 

whoever Steve Leeds is to the—to headquarters from—in his role 

as acting administrator? 

Ms. BRITA. When Jeff reported to Steve Leeds? 

Ms. NORTON. Yes. 

Ms. BRITA. Whatever conversations he had with Steve Leeds, 

Steve reported to Martha. I was not part of that reporting chain. 

Ms. NORTON. I’m simply trying to understand whether or not Mr. 

Neely was an island unto himself when he held these two roles, or 

whether there was any coherent reporting authority who was in 

charge here. 

Ms. BRITA. Well, certainly on paper there was a chain of command and a coherent reporting. 

Ms. NORTON. And what paperwork would that have been, Miss 

Brita? 

Ms. BRITA. It would have been—as RA he was reporting himself 

to Steve, and then Steve—Steve Leeds reported to the administrator. In his role as commissioner, he reported through the RA 

and he reported directly into headquarters to the commissioner of 

Public Buildings Service. 

Ms. NORTON. Is this true of all of the regional administrators, 

they have this dual reporting—— 

Ms. BRITA. Yes. 

Ms. NORTON. And how does that work at GSA? 

Ms. BRITA. It has been something—we are looking at that. It is 

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73 

fully. There are obviously things that need to be streamlined, but 

we are looking at that as part of our top-to-bottom review. 

Ms. NORTON. One wonders if the—two, this is one agency. The 

two functions are of course quite distinctly different. And I can understand the difficulty we have here. It does seem to me, though, 

that other agencies with very distinctively different parts end up 

where somebody at the top is in charge of the whole, and I don’t 

know if this is what happened with the Western Region. I do not 

know whether this is what happened with Mr. Neely. But Mr. Peck 

said, in essence, he knew nothing about the conference. So whatever you do down there, if you hold conferences, it apparently never 

gets to headquarters. Miss Doone knew nothing about the cost, and 

her title is CFO of the entire agency. This is an agency whose 

structure makes no sense. I don’t know if it grew like Topsy over 

time, so that you just kind of fill in the the triangles, but I do not 

understand how, allowing each level to not know what the other is 

doing with a level of decentralization that comes without accountability. Certainly you have got accountability at the top. 

So I am very, very concerned about the structure of the agency. 

I don’t know the origin of this structure. At this point it seems simple minded, and it—and I do want to—I do want to make clear that 

as a person who ran a complicated Federal agency myself, I certainly believe in decentralized management control. I mean, if you 

run Federal agencies like it is the Army, you are really going to 

get in trouble, and by the way, even in the Army there is very decentralized control that you have got. For example, and this is not 

quite the Army, but in the Selective Service or the Secret Service 

matter, you notice that when that scandal broke this week that 

they took the whole unit out? And ultimately, they are going to the 

supervisors and they are going, it seems to me, up a chain of command. As long as we know who reports to who, so that each one 

can hold the other accountable, then the decentralization is good. 

Otherwise, you lose all sense of innovation. People have to ask the 

layer above them, and then the layer above it what should be done. 

Mr. Miller, I don’t know if you will be involved because you now 

know more about at least what went wrong, when the new administrator considers whether there are structural issues. So could I 

ask you, generally is the IG consulted on such matters as to whether or not there are structural issues that should be remedied when 

an agency like this one has to consider what its conceivable remedies are? 

Mr. MILLER. In the past we have not been, but I would suspect 

that Dan Tangherlini, the new acting administrator, will consult 

with us. And I did want—— 

Ms. NORTON. You would have some recommendations, I take it. 

Do you think—— 

Mr. MILLER. We will have some recommendations. Generally, 

this is an agency function, how to manage itself. It has spilled over 

into all sorts of problems that we have observed. So—— 

Mr. DENHAM. Your time has expired. We are going to get deeper 

into those recommendations in the second panel. We are going to 

invite you backup for the second panel as well. 

Miss Brita, going in a slightly different direction. Do you think 

the L.A. Courthouse should be built? 

74 

Ms. BRITA. The agency has made a decision to move forward with 

the L.A. Courthouse, Mr. Chairman. 

Mr. DENHAM. Do you think it should be built? 

Ms. BRITA. As a member of the agency, that is a decision of the 

agency, and I abide by the decision. 

Mr. DENHAM. We have emails. Do you think—we have email. Do 

you think that it should be built? 

Ms. BRITA. I am a member of the agency, and as of now, I believe 

the L.A. Courthouse, that is the decision the agency made, and I 

abide by it. 

Mr. DENHAM. Have you changed your mind? 

Ms. BRITA. I personally will not change my mind about Los Angeles, but as a member of the—— 

Mr. DENHAM. OK, I will not push any further in this direction. 

Ms. BRITA. Thank you, Mr. Chairman. 

Mr. DENHAM. The reason I bring up the L.A. Courthouse, this is 

something that was authorized a decade ago. We have less judges 

than we had a decade ago. We have empty office space in the Roybal Building, a courthouse that is adjacent to the old courthouse 

that is there now. The old courthouse has eight vacant buildings. 

We have vacant courthouses across the Nation. 

Why I bring this issue up, it is estimated $400 million that we 

are going to spend that exceed authorized amounts. This committee 

in a bipartisan fashion has asked for a new prospectus, regardless 

of GSA’s position, regardless of L.A., or California’s position, or the 

Western Region’s position. This is a decade-old prospectus. The 

building has changed significantly. Expenditures are grossly going 

to exceed the amounts that have been authorized and there is 

going to be less space than what was originally authorized a decade 

ago. 

I mean, to me, this seems like we are going to build this at any 

cost. Why this is relevant, not only has the GSA not come back 

with a prospectus and ignored this committee, but we have a separate letter from Martha Johnson on the very topic. We are going 

to be bringing that up again at the next panel as well. 

To me it smells like an inside deal. Why would you move forward 

on this? Let me back up. I don’t think that it is a question of why 

wouldn’t you move forward. Because GSA may have its reasons. 

L.A. may have a way to justify it. There may be a number of different issues and questions out there. But a project that has 

changed significantly from what it originally was, an expenditure 

that is going to far exceed what was originally allocated, and a congressional committee that has not said stop the project, not give 

the money back; just said, give us a new prospectus. Show us how 

you are going to spend the money. If it is justified, show us that 

it is justified. 

Is there any reason why we would not do a new prospectus on 

this building? 

Ms. BRITA. Mr. Chairman, we have, in Region 9, a new regional 

commissioner for the Public Buildings Service. We have a new commissioner here at headquarters, and we have a new acting administrator. I believe that this project will get a thorough review. We 

will work very closely with the subcommittee to answer as many 

questions—in fact, all of your questions and we will come to a joint 

75 

resolution about the Los Angeles courthouse project. It is one of the 

projects that the acting administrator has asked about in his first 

few days. We are preparing that briefing. We will get it ready, and 

we will work with the committee to reach resolution on Los Angeles. 

Mr. DENHAM. Thank you. Mr. Walz. 

Mr. WALZ. I yield back to you. 

Mr. DENHAM. Thank you. I want to go through a separate 

timeline, Mr. Miller. May of 2010. Intern conference in Palm 

Springs. You are doing an investigation on that property, or 

that—— 

Mr. MILLER. Yes. 

Mr. DENHAM [continuing]. That conference? 

Mr. MILLER. Yes, sir, we are. 

Mr. DENHAM. Is that customary to have interns do a conference? 

Are interns employees, or are they like our interns that are—— 

Mr. MILLER. They are employees. They are hired under an intern 

program, where they are probationary employees for, I believe, 2 

years, hired right out of college. So they are full employees, but on 

probationary status. 

Mr. DENHAM. Probationary employees right out of college, interns. Any reason why we would have an intern conference in Palm 

Springs, Riviera Resort. Excluding travel and per diem the conference itself spent $150,000. Is there any reason we should be 

spending that on interns? 

Mr. MILLER. I see no reason. 

Mr. DENHAM. Does it happen in other agencies that you know of? 

Mr. MILLER. I don’t know that it happens in other agencies. I 

don’t believe it happens throughout GSA, but I will check on that. 

Mr. DENHAM. OK, and that IG report you are conducting currently? 

Mr. MILLER. Correct. 

Mr. DENHAM. OK, October 2010. This is the Western Regional Conference that we have heard so much about, almost $1 million 

spent, nine different preplanning parties where we had friends, 

family, all join in on those. Out of all of those different preplanning 

events, how many is customary? I mean, do you always—do you 

have preplanning events for each of these different conferences 

across the United States, around the world? 

Mr. MILLER. It varies, but nine is clearly excessive. And they had 

representatives from the region and a central office representative 

involved in the preplanning. 

Mr. DENHAM. What is customary? In your work as an IG, what 

is customary in GSA? What is customary in other agencies? 

Mr. MILLER. To have a preplanning conference—in terms of offsite at the actual location, I am not sure there is anything that is 

customary. I can’t imagine having, you know, just from my own 

perspective, having any more than one, if that, at the location. 

Mr. DENHAM. I have just never seen it from the business standpoint where you have businesses, corporations that would send not 

only—I wouldn’t think a corporation would send anybody for a 

preplanning conference, but if you did you would send, I don’t 

know, one or two people. Is there any reason why—let’s just assume for a second that there was a need for a preplanning trip. 

76 

How many people do you think should go on a trip like that if you 

were planning? 

Mr. MILLER. I don’t plan conferences. I am not an expert in this 

area. I don’t know that—how many they should send or not. I think 

what they would say is that they would need to hook up the audiovisual and make sure it all worked right and that sort of thing. 

Mr. DENHAM. Wait. I thought that that was the planning—private company that we paid to do that. 

Mr. MILLER. They did hire a private company for that. 

Mr. DENHAM. So they hired a private company and they took 

nine preplanning trips. 

Mr. MILLER. Indeed, indeed. 

Mr. DENHAM. To check out audio-visual. 

Mr. MILLER. In my opinion, the preplanning trips were not justified. 

Mr. DENHAM. Shortly after that, Deputy Administrator Brita, we 

talked about her involvement in this. What is customary when you 

have an IG investigation? I assume that when a whistleblower 

comes forward, you talk to the top administrator, which would 

have been Martha Johnson. Is that—walk us through. How—what 

happens when you get contacted by a whistleblower? What starts 

the investigation, and who do you contact? 

Mr. MILLER. Well, our office of investigations will assign a special agent to the allegation. We will check it out. We will interview 

people. We will get documents. We will find out is there anything 

to this? Is this a meritorious complaint? And as we look at it, we— 

and we may find more allegations. We may find more suspicious 

activity, which happened in this case. As I mentioned, you know, 

we are turning over the—every proverbial rock, every proverbial 

stone, we found 50 more. And so this is how it would work. The 

whistleblower comes to us. We assign agents. We may assign auditors. We may assign forensic auditors. In this case, we also assigned attorneys. I would not necessarily communicate with the administrator. I chose to do so on this particular one, in May of 2011, 

because it was so egregious. We wanted to stop the spending. We 

wanted to stop the waste. 

Mr. DENHAM. How many trips took place between October or November when the whistleblower contacted you and the investigation that you turned over in May of 2011? 

Mr. MILLER. The trips by the Region 9 commissioner that’s separate from the Western Regions Conference report and investigation. 

As we looked at the Western Regions Conference issue, we discovered these additional trips by the regional commissioner, and we 

were quite concerned about that. 

Mr. DENHAM. Ongoing investigation on those trips? 

Mr. MILLER. Yes, we do. And—— 

Mr. DENHAM. All of the various trips prior to the October 2010 

Vegas trip, and after, subsequent to the Vegas trip you are doing 

an investigation on. 

Mr. MILLER. We are investigating the trips we know of. They include some trips prior to that. 

Mr. DENHAM. OK, I am not going to dive too much into that. I 

have seen some of the emails already, but we will come back to 

that. May 2011, you came up with your report. You gave that to 

77 

Administrator Johnson, and at that time you wanted to get a handle on the regional conference’s travel. 

Mr. MILLER. We briefed the—Administrator Johnson in May 

about the WRC. We went through the PowerPoint. The idea was 

to stop more spending, for her to get control of the conferences. I 

personally met with the regional—— 

Mr. DENHAM. I am out of time, but did it stop? 

Mr. MILLER. Not that—not that I could tell. 

Mr. DENHAM. Thank you. Miss Norton. 

Ms. NORTON. I would just like some clarification on the L.A. 

Courthouse. I mean, it goes back to my first days in the Congress. 

Why was—I think it was $400 million. Why was the L.A. Courthouse not built then? I mean, it should not have lived to be an 

issue today since it wasn’t built. Miss Brita. 

Ms. BRITA. Ms. Norton, the L.A. Courthouse, there was always 

an ongoing discussion between the judges, between the Administrative Office of the Courts and GSA itself, PBS itself, about what 

would be built out in Los Angeles; the number of courtrooms, the 

size of the buildings. It was back and forth and back and forth. It 

spanned commissioners. It spanned administrations. Even the 

Bush administration, the Clinton administration. It went back and 

forth. And it was very difficult for the agency to reach resolution 

with the judges about what exactly to build out there. 

Ms. NORTON. So here we have judges who may know something 

about the law having a considerable role in what the GSA builds 

and even—even deeply enough so that they can stop a building 

from being done simply by objecting to the number of rooms, even 

how big it is. This is one of the reasons why, of course, we got a 

GAO report on shared courthouses, and while the judges have been 

the bane of at least my existence ever since I have been in the Congress, and the committee of course now has a policy which is very 

clear about who makes decisions about the size of courthouses and 

who should be involved. I will say it again, the judges have been 

a major factor in courthouse waste, and the L.A. Courthouse which 

was bandied about by them in GSA, and I am going to say GSA 

paying disproportionate attention to them, now leaves us in the position where you have some appropriators wanting the courthouse 

because the money is out there. 

Let me ask you, Mr. Peck. Will any additional funds be necessary—this was at least, what it is 15 years ago, Miss Brita, that 

this money was appropriated? How is anybody even going to build 

a courthouse at all, or are you expecting that you will begin to 

build and you will come back and say, we need some more money 

for the L.A. Courthouse, which of course this committee thinks we 

don’t need in the first place. 

Mr. PECK. Ms. Norton, the appropriations I think for this were 

made in 2001 and then again in 2004 or 2005. 

Ms. NORTON. I am sorry, what was made in 2000? 

Mr. PECK. The appropriations for the courthouse. 

Ms. NORTON. You mean they keep reappropriating the same 

money? 

Mr. PECK. No, ma’am. I am just saying there were two tranches. 

There was an appropriation I believe for site and design in 2001 

and then appropriation for construction in 2004. 

78 

Ms. NORTON. Well, is the total cost $400 million? 

Mr. PECK. The total cost is $399 million. 

Ms. NORTON. So in 2000, a dozen years ago, it was believed that 

the courthouse should cost $400 million. Could a courthouse be 

built in L.A. for $400 million today? 

Mr. PECK. Today the construction budget, if I recall correctly, is 

about $335 million. It can be built. It is much reduced in scope 

from what the judges wanted. And if GSA manages—— 

Ms. NORTON. So it is half of your—— 

Mr. PECK. I would have to go back and look at how many. It is 

many fewer courtrooms than were proposed back in 2001 or 2004. 

Ms. NORTON. Do you think this courthouse should be built at all 

now that you are free of the post that you held at GSA? If you had 

your—if you had the ability to make an independent judgment, Mr. 

Peck, would you believe that there are other ways to accommodate 

the needs in L.A. than building even a scaled down courthouse? 

Mr. PECK. I did take a look at alternatives for providing the kind 

of security and space that the courts need. I was convinced that the 

best thing to do was, in fact, to build a new courthouse, to fill up 

the other building, the Roybal Building, and with respect to the 

historic courthouse, either retain it in the GSA inventory and move 

a lot of expensive lease space in Los Angeles into that building or 

sell off the historic courthouse. 

Ms. NORTON. Is that what the agency is going to do? 

Mr. PECK. Well, that was when I left, those two alternatives for 

the use of the historic courthouse was what were being considered. 

Ms. NORTON. Could any additional Federal building funds be 

used if there were any shortfall in building, assuming it precedes 

the L.A. Courthouse, or does the agency feel constrained by whatever funds have already been appropriated? 

Mr. PECK. Well, when I left I said that we would, GSA would 

never come back for more money for the Los Angeles courthouse if 

the contract were in fact awarded, but that was my direction. 

Ms. NORTON. Has construction begun on a new courthouse in 

L.A.? 

Mr. PECK. No, ma’am. It is, as I understand it, there is a solicitation on the street for a design-build contract to design and build 

a courthouse for $335 or so million. 

Ms. NORTON. Thank you, Mr. Chairman. 

Mr. DENHAM. Ms. Doone, when was Mr. Peck fired? 

Ms. DOONE. I don’t know the specific date. 

Mr. DENHAM. Do you have a specific date, Ms. Brita? 

Ms. BRITA. I don’t. I am sorry, Mr. Chairman. It was the beginning. 

Mr. DENHAM. Do you recall, Mr. Peck? 

Mr. PECK. Yes, sir. 

Mr. DENHAM. Mr. Miller. 

Mr. PECK. April 2nd. 

Mr. MILLER. April 2nd. 

Mr. DENHAM. April 2. Mr. Leeds the same day? 

Mr. MILLER. Correct. 

Mr. DENHAM. And administrative leave for Mr. Neely? 

Mr. MILLER. I believe it was around the same time. 

79 

Mr. PECK. Mr. Chairman, I believe it was a week or two in advance of that. 

Mr. DENHAM. And who else has been put on administrative 

leave? 

Ms. BRITA. Mr. Chairman, there are four other people who are 

on administrative leave, the RCs of the various regions and one 

person at headquarters. 

Mr. DENHAM. So which regions? 

Ms. BRITA. 7, 8 and 10. 

Mr. DENHAM. And 9 is Mr. Neely? 

Ms. BRITA. That is correct. 

Mr. DENHAM. All four regions have been put on administrative 

leave? 

Ms. BRITA. That is correct. 

Mr. DENHAM. None of them have been fired? And then one person at headquarters? 

Ms. BRITA. And one person at headquarters. 

Mr. DENHAM. How about Ms. Daniels? 

Ms. BRITA. I think Ms. Daniels was put on administrative leave 

just recently. I think she mentioned she got her letter. 

Mr. DENHAM. And when did Martha Johnson retire, resign? 

Ms. BRITA. The 3rd. 

Mr. DENHAM. Mr. Miller, when did you make this committee 

aware of the IG report? 

Mr. MILLER. I believe it was on April 2nd. 

Mr. DENHAM. I would agree. I want to go back to this timeline. 

November 2010, Ms. Brita requests the IG report. May 2011, you 

finalize the first draft of this. You have now determined there is 

some fraud, there is some waste, there is some wrongdoing here. 

And while you have not completed the report at this point you have 

said stop, we have a problem here. 

Mr. MILLER. Yes, sir. 

Mr. DENHAM. You took that all the way to the top to Ms. Johnson? 

Mr. MILLER. Yes. 

Mr. DENHAM. June 2011, GSA Chief of Staff Michael Robertson 

informs Kimberly Harris, a White House counsel, about an active 

IG investigation regarding fraud and wasteful spending related to 

the Western Regions Conference. In June, you would agree with 

that timeline, Mr. Miller? 

Mr. MILLER. I don’t know what was said to the White House. 

Mr. DENHAM. August 2011, GSA appoints Ruth Cox regional administrator for Region 9, GSA OIG briefs Ms. Cox and advises her 

to get a handle on Regional Commissioner Neely and his travel. 

Mr. MILLER. Correct. 

Mr. DENHAM. October 2011, you have already said let’s get a 

handle on this, you have made it clear, crystal clear to the Administrator Martha Johnson. 

Mr. MILLER. Correct. 

Mr. DENHAM. She has done what she has, at least partially what 

she is supposed to do and let the White House Chief of Staff or 

GSA Chief of Staff, liaison to the White House, know that there is 

a problem. The GSA Chief of Staff, liaison to the White House, 

alerts Kimberly Harris, a White House counsel. Then a new adminVerDate Aug 31 2005 13:48 Jul 26, 2012 Jkt 000000 PO 00000 Frm 00089 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\ED\4-17-1~1\73825.TXT JEAN
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istrator or a new regional administrator comes in. Is Ms. Cox still 

employed? 

Mr. MILLER. Yes, she is. 

Mr. DENHAM. OK. So you had a recommendation, the White 

House is alerted, we have a new regional administrator and then 

Mr. Neely continues to go on a number of different trips: October 

2011, a 9-day trip to Hawaii for this road show that we already 

threw up the email on the party with his wife; November 2011, a 

5-day trip to Atlanta to attend a nontraining conference; December 

2011, Ms. Brita, deputy administrator, warns of the 17 South Pacific junket that Mr. Neely is about to take in December; several 

other trips here, Dana Point, Napa, a number of other ones that 

I know you are going through on your investigation. But February 

of this year, the 17-day trip goes on. This is after you have told 

Martha Johnson we had a problem the previous May, we put a new 

administrator in charge, the White House has been alerted, Ms. 

Brita has come back and said this trip is not a good idea, you said 

this trip is not a good idea, and Mr. Neely continues to go on this 

trip with his wife for her birthday and a party. 

Mr. MILLER. Right. 

Mr. DENHAM. Did it stop there, did he take any more trips after 

that? February of this year, was that his last trip? 

Mr. MILLER. I believe they had a Napa Valley conference. 

Mr. DENHAM. Just one was that? 

Mr. MILLER. Yeah, I believe just one. 

Mr. DENHAM. How about the March trip, the 4-day visit to Hawaii? 

Mr. MILLER. The March trip, March of this year, I think that was 

the last one we have knowledge of. 

Mr. DENHAM. In March of 2012, I have got a 4-day site visit to 

Hawaii for Mr. Neely, also in March 2012 a 4-day offsite trip to 

Napa for the executive team meeting, $40,000 for that conference 

not including travel expenses. 

Mr. MILLER. He had four trips after the Saipan 3-week trip. 

Mr. DENHAM. I have been asking for information about this 

budget since day 1. We have requested as a bipartisan fashion to 

get a handle on this budget. An IG report comes out, internal recommendations, the White House is alerted. We go so far as to replace Neely. You recommend no more trips, Ms. Brita recommends 

no more trips. Martha Johnson is aware of all of these trips and 

they continue to go on for the next several months. We are talking 

a year-and-a-half now. Was anybody fired during that year-and-ahalf that you know of? Was anybody put on administrative leave? 

Mr. MILLER. Not that I know of. 

Mr. DENHAM. Anybody resign? 

Mr. MILLER. Not that I know of. 

Mr. DENHAM. So on April 2nd, we still don’t have a budget, a 

year-and-a-half later we still don’t have all of the expenses that 

have been spent out of this fund. There is no justification for the 

amount of money that continues to increase every single year, a 

budget that is outside of Congress because it uses all the rent 

money from all of the public buildings, and then not until April 3rd 

does anybody get fired, does anybody resign or is anybody put on 

administrative leave and held accountable. 

81 

I think the American public can see why this committee is so 

frustrated. I hope the administration, I hope the new GSA administration is seeing how frustrated the American public is. A lot has 

been talked about in the media about this lavish expense of Las 

Vegas, and it is inexcusable. But this culture of fraud, waste, corruption, coverups, while we can’t prove it yet there certainly has 

the perception that there is an inside deal on some of these things. 

We certainly are going to investigate more into the L.A. Courthouse and other issues like it. But this certainly is not only a dark 

day for GSA but it is a dark day for the United States Government. 

We wonder why there is so much distrust in Government. 

Mr. Walz. 

Mr. WALZ. Well, I would—I think the chairman’s frustration, Ms. 

Norton’s frustration and all the Members’ is apparent. Again, I 

would like to thank the IG’s office for continuing to do the work 

that is necessary and to prove that there are checks and balances. 

This hearing is one of those. And I would echo what Mr. Cummings 

said, the emotions and frustrations need to translate into changes, 

systemic changes to make sure it doesn’t happen again. That is the 

real goal. So this is probably only the beginning. And again I don’t 

think words adequately describe our frustration, because as I said, 

this is money that could have been targeted towards veterans, targeted towards Head Start, targeted towards limited resources, and 

it wasn’t. 

So with that I yield back, Mr. Chairman. 

Mr. DENHAM. Ms. Norton. 

Ms. NORTON. Just one final comment. Mr. Chairman, when the 

chairman goes through all the trips made after a new administrator was appointed and suggests that there may have been nefarious dealings here, I go back to whether appointing a regional administrator makes any difference in the structure you have. It 

seems to me that if these trips were going on, the only line, 

straight line I see is to the commissioner in Washington because 

these were, he was then a PBS commissioner only. As the commissioner in Washington says, he wasn’t the one who was supposed to 

keep track of these trips even after these issues had become known 

inside the agency. So I am not sure whether one needed to do anything nefarious if you have—if you appoint a regional administrator and it really doesn’t make any difference. Because it looks 

like her control is either so bifurcated or so attenuated that it 

doesn’t matter unless she is a very strong person, and remember 

she is only at the regional level. 

So I have great problems with how this could have continued. I 

think that appearance problems are raised. I see no evidence that 

there was any corruption going on. I think all you had to do was 

take a trip. And since no one was in charge when you were acting 

administrator of your trips or when you were PBS and acting administrator of your trips, when you went back to being PBS nobody 

was in charge, because this agency apparently is structured so that 

people in Washington don’t have accountability even though the 

line runs straight up to them. 

That is very, very troubling. I do want to say for the record that 

the employees who were put on administrative leave, even people 

who carried the title of commissioner, were civil servants. And in 

82 

our law and in Federal regulations you cannot simply fire them 

without some due process. So I think that is going on now. What 

has happened at the top of the agency is that all of the political 

appointees, so far as I can tell, have in fact been taken out of the 

agency. That is not going to cure the problems, as testimony here 

I think today makes clear. And the chairman and I have an obligation to proceed to see just what is going to happen. It is going to 

be a new regime, but it is going to involve some of the same actors 

who are at the table this afternoon, and I want to thank you for 

your testimony. 

Mr. DENHAM. We are going to move into the second panel. I 

would ask Mr. Peck, Ms. Doone, and Ms. Brita to remain within 

the committee room. There may be further questions that we have 

for you as the second panel comes on. Mr. Miller, we invite you to 

stay here on the panel. The second panel of witnesses will not only 

include Mr. Miller but the Honorable Daniel Tangherlini, acting 

administrator, U.S. GSA, the Honorable Martha Johnson, former 

GSA administrator, and Mr. David Foley, Public Buildings Service 

deputy commissioner. 

Mr. Tangherlini, you are the new guy? 

Mr. TANGHERLINI. Yes, sir. 

Mr. DENHAM. I see no reason that you will not tell us the truth, 

therefore we will forego the swearing in. 

I would ask unanimous consent that our witnesses’ full statement be included in the record. Without objection, so ordered. Since 

your written testimony has been made part of the record, the subcommittee would request that you limit your oral testimony to 5 

minutes. Mr. Miller, since we have already received your statement, unless you have anything further you would like to add at 

this time, we will ask Mr. Tangherlini to begin. 

Mr. Tangherlini. 

TESTIMONY OF THE HONORABLE BRIAN D. MILLER, INSPECTOR GENERAL, U.S. GENERAL SERVICES ADMINISTRATION; 

THE HONORABLE DANIEL TANGHERLINI, ACTING ADMINISTRATOR, U.S. GENERAL SERVICES ADMINISTRATION; MARTHA N. JOHNSON, FORMER ADMINISTRATOR, U.S. GENERAL 

SERVICES ADMINISTRATION; AND DAVID FOLEY, PUBLIC 

BUILDINGS SERVICE DEPUTY COMMISSIONER, U.S. GENERAL SERVICES ADMINISTRATION 

Mr. TANGHERLINI. Good morning, Chairman Denham, Ranking 

Member Norton, members of the subcommittee. My name is Dan 

Tangherlini, and I am the acting administrator of the U.S. General 

Services Administration. I appreciate the opportunity to come before the committee today. 

First and foremost, I want to state that the waste and abuse outlined in the inspector general’s report is an outrage and completely 

antithetical to the goals of the Administration. The report details 

violations of travel rules, acquisition rules, and good conduct. Just 

as importantly, those responsible violated rules of common sense, 

the spirit of public service and the trust that America’s taxpayers 

have placed in us. I speak for the overwhelming majority of GSA 

staff when I say that we are as shocked, appalled and deeply disappointed by these indefensible actions as you are. 

83 

We have taken strong action against those officials who are responsible and will continue to do so where appropriate. I intend to 

uphold the highest ethical standards at this agency, including referring any criminal activity to appropriate law enforcement officials and taking any action that is necessary and appropriate. If we 

find any irregularities, I will immediately engage the GSA’s inspector general. As indicated in the joint letter that Inspector General 

Brian Miller and I sent to all GSA staff, we expect any employee 

who sees waste, fraud or abuse to report it. We want to build a 

partnership with the IG while respecting their independence that 

will ensure that nothing like this ever happens again. There will 

be no tolerance for employees who violate or in any way disregard 

these rules. I believe this is critical not only because we owe it to 

the American taxpayers, but also because we owe it to the many 

GSA employees that work hard, follow the rules and deserve to be 

proud of the agency for which they work. 

We have also taken steps to improve internal controls and oversight to ensure this never happens again. Already I have canceled 

all future Western Regions Conferences. I have also canceled 35 

previously planned conferences, saving nearly $1 million. I have 

suspended the Hats Off stores and have already demanded reimbursement from Mr. Peck, Mr. Shepard and Mr. Neely for private 

in-room parties. I have canceled most travel through the end of the 

fiscal year agencywide, and I am centralizing budget authority and 

have already centralized procurement oversight for regional offices 

to make them more directly accountable. 

I look forward to working in partnership with this committee to 

ensure that there is full accountability for these activities so that 

we can begin to restore the trust of the American people. I hope 

that in so doing GSA can refocus on its core mission, saving taxpayers’ money by efficiently procuring supplies, services and real 

estate, as well as effectively disposing of unneeded Government 

property. We believe that there is a great need for these services 

and the savings they bring to the Government and the taxpayer. 

There is a powerful value proposition to a single agency dedicated to this work, especially in these austere fiscal times. We need 

to ensure we get back to basics and conduct this work better than 

ever. At GSA our commitment is to our service, our duty and our 

Nation and not to conferences, awards or parties. 

The unacceptable, inappropriate and possibly illegal activities at 

the Western Regions Conference stand in direct contradiction to 

the express goals of this agency and the Administration, and I am 

committed to ensuring that we take whatever steps are necessary 

to hold responsible parties accountable and to make sure that this 

never happens again. We need to focus this agency on the basics, 

streamlining the administrative work of the Federal Government to 

save taxpayers’ money. 

I look forward to working with the committee moving forward, 

and I welcome the opportunity to take any questions. Thank you. 

Mr. DENHAM. Thank you. Ms. Johnson. 

Ms. JOHNSON. Chairman Denham, Ranking Member Norton, and 

members of the committee, on April 2, 2012, I resigned as administrator of the General Services Administration and left my cherished career as a public servant. I stepped aside to allow a new 

84 

team to rebuild GSA from the major missteps of the Western Regions Conference in October 2010. 

I previously served GSA in the Clinton administration, leaving in 

2001. At that time the leadership team was strong, the schedules, 

design excellence and other programs were producing much value 

for their customers. 

When I returned to GSA in 2010, the agency was not the same. 

A quarter of the executive positions were empty, customers viewed 

our partnership askance, labor relations were acrimonious, the 

leasing portfolio had ballooned and more. Nearly 2 years had 

elapsed without a confirmed administrator. My confirmation was 

delayed 9 months. By the time I was sworn in, a sequence of four 

acting administrators had overseen the agency. 

I did not know there was yet another problem. The Western Regions Conference had evolved into a raucous, extravagant, self-congratulatory event that ultimately belittled Federal workers. The expense of planning for the conference was well underway when I entered GSA and I was unaware of the scope. 

Thus, I began my tenure as administrator. I take this opportunity to thank the overwhelming majority of GSA’s 13,000 employees who rose to the task of renewal. Their record is extraordinary. 

Energy efficient buildings, competent management of the fleet, IT 

acquisition, the innovative challenges .gov Web site and much 

more. 

For my part I set about reconstituting GSA’s executive team 

after much work. Customers now praise GSA publicly, the labor 

partnership is fruitful, GSA has email in the cloud and GSA will 

relinquish leases and save millions with its renovated headquarters. 

However, GSA’s performance tragically does not compensate for 

the mistakes of the Western Regions Conference. I greeted the IG 

report of the conference without hesitation agreeing with all the 

recommendations. I am extremely aggrieved by the gall of a handful of people to misuse Federal tax dollars, twist contracting rules, 

and defile the great name of GSA. 

This is how that chapter unfolded. Deputy Administrator Susan 

Brita requested an investigation into the conference. The IG subsequently shared with us a PowerPoint deck in May 2011. I realized 

this was a very serious matter. We needed all the facts, all of them, 

however painful and disruptive. While the investigation continued 

we appointed a regional administrator for Region 9, relieving Mr. 

Neely of that role, established a chief administrative services office 

reporting to me with responsibility for GSA’s acquisition, oversight 

of travel and conferences and the like, continued streamlining and 

shortening Government training conferences. We also catalogued 

our own conferences, and Ms. Brita reviewed expenditures until 

she was satisfied that controls were in place. Upon receiving the 

IG’s draft report in February 2012, we began disciplinary action, 

revised internal controls and adjusted budgets to penalize regions 

for the wasted money. 

The egregious and coarse nature of the evidence and the waste 

of resources assured a loss of confidence in GSA leadership. Therefore, I terminated two appointees in the chain of command and 

submitted my own resignation. I personally apologize to the AmerVerDate Aug 31 2005 13:48 Jul 26, 2012 Jkt 000000 PO 00000 Frm 00094 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\ED\4-17-1~1\73825.TXT JEAN
85 

ican people. As the agency head, I am responsible. I will mourn for 

the rest of my life the loss of my appointment. 

Mr. DENHAM. Mr. Foley 

Mr. FOLEY. Thank you. Chairman Denham, Ranking Member 

Norton, members of the subcommittee, thank you for inviting me 

here to testify today. My name is David Foley, and I am the deputy 

commissioner for the Public Buildings Service. 

I sincerely apologize for my remarks at the awards ceremony for 

the Western Regions Conference. At the time of my remarks I was 

not aware of the significant spending irregularities. I did not intend to condone any wasteful spending or minimize the role of congressional oversight. As I said yesterday, I especially want to apologize to this committee in particular and Congresswoman Norton. I 

have the utmost respect for her and this committee. You have always been strong advocates for GSA and its programs while holding us accountable as an agency. 

I did not mean to belittle you or your role in any way. I attempted to make a joke in the context of a talent celebration that 

I perceived as being similar to a comedic roast. As the deputy commissioner, I should have taken the stage to stress that we have a 

serious job and responsibility as stewards of taxpayer funds. I realize I missed a real opportunity to address the nearly 300 people in 

my organization and stress the importance of the work we do. 

During my presentation at the award ceremony I told the award 

recipient I was making his dreams come true by making him commissioner for the day. Obviously that was a joke. I was not seriously delegating any authority to the awardee. I also joked about 

some of the obligations of being commissioner. My understanding 

at the time was that the commissioner was paying for the charges 

associated with the after-hours party on Tuesday evening, so I 

tried to use that in a humorous way and suggested the awardee 

would have to pay for the party and the hotel. 

Finally, I said the acting commissioner would have to answer for 

his proposed pay increases in the video. My intent was to point out 

the commissioner has a lot of responsibilities and has to answer to 

a lot of people in the Administration and Congress, not to mock the 

various oversight roles. My remarks were wrong and I take full responsibility for what I said. 

I understand the outrage about this conference, my comments 

and how they have inflamed all of the issues surrounding this 

event. 

I preface the rest of my statement by saying I have only seen a 

draft of the IG report that appears to be the same as what has 

been released publicly. I have not seen any of the supporting documents and was not questioned or briefed by the IG during the investigation so I do not know all of the details. This represents my 

understanding based upon what I remember from almost 2 years 

ago. 

Concerning my role in the Western Regions Conference, again I 

want to start by personally apologizing. While I was not directly involved in the planning for the conference or any of the financial 

and contracting irregularities identified in the inspector general’s 

report, I did attend 21⁄2 days of the conference. There were things 

86 

that seemed over the top, but I believed they were not being paid 

for with Government funds. 

In past conferences items like the tuxedos and the after-hour 

parties were paid for by individuals, not the taxpayer. Had I known 

what has since been revealed I would have been concerned and reported it. Because of the regional reporting structure in our agency 

I did not have supervisory control or authority over how the regional budget was spent, procurement activities or any of the employees in the Western regions. The regional commissioners and 

their staff reported directly to their regional administrators with 

input from the commissioner who report in turn to the administrator’s office. My primary role as the deputy commissioner is dealing 

with the Office of Management and Budget, Congress and other 

Federal agencies on critical projects and policy issues. I am not a 

contracting officer, and I do not have a warrant to approve expenditures. 

I have spent the last 15 years of my career working for GSA, and 

I believe strongly in the agency’s mission and the value it provides 

to other agencies and our country. I am truly sorry for my comments and apologize to this committee, the Administration, my fellow GSA employees and, most importantly, the American taxpayers. 

At this point I am willing to take any questions you may have. 

Mr. DENHAM. Thank you. Let me start with Mr. Tangherlini. I 

know there is going to be a number of questions about what you 

are implementing today and the reassurances you can give to the 

American public that you have put the safeguards in place to address this. 

I want to just touch on before we get started with the questions 

what is being done on transparency. You have heard—I have been 

asking, this committee has been asking for quite some time for a 

budget for the last 5 years. I assume that that is something that 

you have readily available today. How long will it take you to get 

that to this committee? 

Mr. TANGHERLINI. I have your letter of April 13th. You have 

given us an April 25th deadline. I intend to meet that deadline. 

Mr. DENHAM. Five-year budget, full details, full disclosure? 

Mr. TANGHERLINI. We will provide you all the information that 

we can get. As you heard today, there are serious concerns about 

the way the data has been managed within the regional structure, 

but I will get you everything I can. 

Mr. DENHAM. You are also doing an internal audit right now. 

The IG is still doing an audit or an investigation. What will the 

audit, what do you anticipate, what are you looking for in the audit 

that you are not going to get for me in the IG report? 

Mr. TANGHERLINI. Well, I want to do a top-to-bottom review of 

the organization, how it is set up, how it spends its money. I want 

to see what I get out of that. I want to see if there are issues of 

how we can better structure it. Already we have taken a move to 

bring the financial offices, the regional financial offices, and the 

service financial officers under our CFO. We have done—taken 

some action to centralize oversight of procurement authority. And 

that is just the start. 

Mr. DENHAM. When do you expect to be done with the audit? 

87 

Mr. TANGHERLINI. Well, I want to take as much time as necessary to get a great picture of the status of the organization. That 

having been said, if there are ideas that come out of our review, 

we are going to implement them immediately. 

Mr. DENHAM. Will the audit take months, weeks, years? 

Mr. TANGHERLINI. We would like to do it as part of the budget 

development process, which culminates in submitting the 2014 

budget in September. That having been said, if there is anything 

that needs to be changed immediately we are going to change it. 

Mr. DENHAM. Well, this committee would request not only the 

immediate changes that are being done in detail but we would also 

request a copy of that audit. Do you think it will take as long as 

September to receive a copy of the audit? 

Mr. TANGHERLINI. I would call it more of a top-to-bottom review 

than an audit. An audit is a very specific activity. But that having 

been said, any details that we develop we will be happy to share 

with the committee. 

Mr. DENHAM. Thank you. 

Mr. Miller, you have referred a number of things to the Department of Justice, criminal action, some sweetheart deals. Can you— 

what can you share with this committee on the reference to DOJ? 

Mr. MILLER. Very little, unfortunately. I can state that we made 

the referral and that is about it. 

Mr. DENHAM. Ms. Johnson, the timeline that I went through— 

well, first of all, let me start with the first timeline that I discussed 

with Mr. Peck. Ultimately I hold him accountable for not sharing 

or ignoring or stonewalling this committee on the budget. Obviously there was a great deal to hide. But in over a dozen requests 

to have a copy of that budget over the last year-and-a-half, we also 

requested and submitted a letter to you, is there any reason why 

you failed to permit us or failed to give us a copy of the budget? 

Ms. JOHNSON. I am sorry if there was a request in to me to supply you information that I did not acknowledge or respond to. I do 

not have a memory of this at this time. 

Mr. DENHAM. Thank you. Let me go into the timeline of the different travels we have seen here. I would assume that when we see 

the further investigation that it is going to result in a number of 

other trips. I think this committee, I think the American public at 

this point is probably prepared for the worst after seeing what we 

have. But nevertheless let me start with May of 2010, where we 

had the nine trips for the preplanning. A lot has been talked about 

Las Vegas. You endured a lot of that yesterday with $1 million 

being spent on the Vegas trip. My concern is the pattern here and 

what happened after the fact. 

Ms. Brita went to the IG in November. In May the IG came back 

with the recommendation to you, advised you to get a handle on 

the regional conference’s travel. This is May of last year. In June, 

the Chief of Staff, your Chief of Staff Michael Robertson informed 

the White House, he was formerly the liaison to the White House, 

he let Kimberly Harris, a White House counsel, know about an active IG investigation regarding fraud and wasteful spending related 

to the Western Regions Conference. In August you felt it was important enough to put Ruth Cox, regional administrator for Region 

88 

9—let me stop there. Did you put Ruth Cox in as the new regional 

administrator? 

Ms. JOHNSON. Yes, we appointed Ruth Cox as the regional administrator. 

Mr. DENHAM. Why? 

Ms. JOHNSON. We needed to fill the administrator, the regional 

administrator’s position. It had been double filled by Jeff Neely for 

quite a while. While I had been working hard to get regional administrators in all the regions, this is the one that was still outstanding and I was eager to get it filled. For a number of reasons, 

not the least of which is that the regional administrator is an important person in the line of, in the chain of command, in the line 

of authority over the regions and I am the administrator of the 

whole organization, the regional administrators are in the regions, 

and it is important to have that presence there. 

Mr. DENHAM. You advised the new regional administrator, Ruth 

Cox, to get a handle on the Regional Commissioner Neely’s travel? 

Ms. JOHNSON. I did not personally advise her to get a handle on 

his regional travel. 

Mr. DENHAM. Thank you. My time is expired. I will come back 

to that. 

Ms. Norton. 

Ms. NORTON. Thank you very much. Mr. Foley, I heard your testimony yesterday as I was of course in the cloakroom, and as I said 

yesterday, even members of the Oversight Committee know the difference between a joke and corruption. So I recognize that that was 

a joke. The problem with the joke is that what nobody knew at the 

time was that there was some honest to goodness, perhaps not as 

the joke had indicated, but some honest to goodness nefarious dealings that have come out since. And as I reported to you, unless you 

feel that I took umbrage at the joke, I took just the opposite since 

the joke had you, or somebody had me already on the phone with 

a conference call questioning some of the excesses. That really 

wasn’t the problem. The problem was that it turned out that this 

whole affair was no joke. 

I must say I don’t understand your title. You have the title of 

deputy Public Buildings Service commissioner. 

Mr. FOLEY. Deputy commissioner, yes. 

Ms. NORTON. Does—do the commissioners report, in the regions 

do the commissioners, the building service commissioners report to 

you? 

Mr. FOLEY. No. 

Ms. NORTON. So what is your function? 

Mr. FOLEY. As I said in my opening statement, my primary function is dealing with the Office of Management and Budget, congressional committees and other agencies on critical projects, policy 

issues and initiatives. 

Ms. NORTON. So you are basically a policy person, not a person 

in the line, in the chain of command for the public service commissioners? 

Mr. FOLEY. Correct. I have one direct report. 

Ms. NORTON. Why did you go to Nevada? 

Mr. FOLEY. I gave a presentation on the afternoon of my arrival 

on Tuesday on our performance results, key initiatives, and outlook 

89 

on the capital budget for fiscal year 2011. I also stayed until the 

end for the award ceremony. 

Ms. NORTON. Mr. Miller, the notion of Hats Off will have no 

meaning to the general public, has no meaning to me. As I understand it, it is supposed to reward employees for meritorious work. 

Would you please describe the Hats Off program? 

Mr. MILLER. The Hats Off program was one of many programs 

at GSA. Each program had a different name. In Region 9 it was 

known as Hats Off. 

Ms. NORTON. Was it only in Region 9? 

Mr. MILLER. No, it was in other regions except for Region 2. All 

the other regions had a similar program. The idea was if an employee performed well they would get a certain number of points. 

Ms. NORTON. Well, who would give the points, Mr. Miller? 

Mr. MILLER. They could be given by a coworker, they could be 

given by a supervisor. 

Ms. NORTON. Mr. Miller, just a second. They could be given by 

a coworker? 

Mr. MILLER. Correct. So one coworker could give points to another coworker and the other coworker could give them back. 

Ms. NORTON. Based on what, Mr. Miller? Is Hats Off for the purpose of awarding something at the end after a number of points 

have been reached? 

Mr. MILLER. Yes. You collect the points and you can trade the 

points in for a prize. Under GSA regulation the prizes could not exceed $99. In Region 9 they did exceed $99. They included iPods, 

digital cameras, and similar electronic items. 

Ms. NORTON. Mr. Miller, what is to keep—I don’t understand the 

point system. I have a friend, I need some points. How does one 

have to justify giving points if you are a coworker or for that matter if you are a supervisor? 

Mr. MILLER. We found a rampant abuse of the point system and 

of the program, and we recommended shutting it down. So I believe 

that Administrator Johnson had a review by the CFO Alison 

Doone, who was on the first panel. She did a review of all the programs across the country. We were told that in September of 2011 

that Region 9 was shutting down its Hats Off program. 

Ms. NORTON. I am going to have to come back to this, but I have 

got to understand how a coworker could help you get points, but 

go ahead. 

Mr. MILLER. Well, that is part of the problem that we identified. 

Ms. NORTON. Because it is supposed to be for work related matters? 

Mr. MILLER. Correct. 

Ms. NORTON. And normally work is judged by a supervisor of 

some kind? 

Mr. MILLER. Correct. And supervisors technically were not supposed to receive rewards on the basis of this. 

Ms. NORTON. Supervisors themselves could not receive? 

Mr. MILLER. Correct. But in Region 9 I believe there were some 

supervisors receiving some awards. 

Ms. NORTON. Thank you, Mr. Chairman. 

Mr. DENHAM. Ms. Johnson, what restrictions were on the regions 

to confine their spending to approved budget levels? 

90 

Ms. JOHNSON. Restrictions by the regions. The regions are made 

up of the two divisions, the Federal Acquisition Service and the 

Federal—the Public Buildings Service. The Public Buildings Service budgets were allocated out of the central Public Buildings Service office to the regions, and so that portion of the regional budget 

was managed by the region and reported back up into the Federal, 

the central office of the Public Buildings Service. The Federal Acquisition Service has a different process. They have a different fund 

that they work from and their reporting structures are highly centralized and—are highly centralized. 

Mr. DENHAM. So how do you approve the budgets? 

Ms. JOHNSON. I approved the budgets. I met with the commissioners weekly and on a quarterly basis we reviewed their financial 

performance. In terms of approving their budgets as we went 

through the budget cycle every year thinking about what was— 

well, in the Public Buildings Service what was going to be a budget 

request. All of that was related to me and we met and discussed 

it. On the acquisition side it was a different kind of conversation 

because it was based on the acquisition fund that yielded their essential revenue and then how they spent it. They reviewed that 

with me quite carefully. 

Mr. DENHAM. So how did the budget triple, PBS commissioner’s 

budget triple from 2009 to 2011? 

Ms. JOHNSON. Congressman, I am sorry, I don’t know about 

those numbers and I am not able to research them. 

Mr. DENHAM. How did it go up by $50 million for the PBS headquarters? 

Ms. JOHNSON. I don’t understand that and I don’t know. 

Mr. DENHAM. How did it go up by $80 million, $83 million for 

the regional offices? 

Ms. JOHNSON. I don’t understand that and I have no knowledge 

about that that is useful right now. 

Mr. DENHAM. So then you certainly wouldn’t know how a budget for these conferences would balloon from $250,000 if they had it 

budgeted to more than $800,000, almost $1 million? 

Ms. JOHNSON. Congressman, when I received the final report 

from the IG delineating these expenses and these abuses, I was appalled and I pulled the disciplinary levers that I could pull immediately. I then removed the two senior officials in the chain of command and I resigned. 

Mr. DENHAM. I want to come back to that. But let me finish with 

this understanding of how your operation worked. 

Ms. JOHNSON. OK. 

Mr. DENHAM. Mr. Neely and the other Public Buildings Service 

regional commissioners, who are they accountable to? Was it Mr. 

Peck? 

Ms. JOHNSON. GSA is a matrix organization. I know Congresswoman Norton is also concerned with this. It is a matrix organization in that the regional commissioners, both the FAS acquisition 

service and PBS service, reported in two ways. They reported to 

their regional administrator who was the immediate representative 

of me in the region, and then they reported functionally to the central office commissioners because that is where they received their 

budgets and their strategic direction. It is a matrix, like a corporaVerDate Aug 31 2005 13:48 Jul 26, 2012 Jkt 000000 PO 00000 Frm 00100 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\ED\4-17-1~1\73825.TXT JEAN
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tion, it is not an easy one. It is not command and control like military services, it is a matrix. And so—— 

Mr. DENHAM. Mr. Tangherlini, I assume you think that is a problem? 

Ms. JOHNSON. It was difficult to manage, it is always difficult to 

manage a matrix. 

Mr. DENHAM. Or changing the matrix, Mr. Tangherlini? 

Mr. TANGHERLINI. We are going to look at the matrix. Clearly 

this form of structure created some issues associated with this conference and we are concerned about what it could create going forward. 

Mr. DENHAM. Ms. Johnson, you were briefed by the IG last May. 

Why did you allow Mr. Neely and others to continue their trips and 

offsite meetings up until just a couple of weeks ago? 

Ms. JOHNSON. Congressman, the conversation that we had with 

the IG in May alerted me to how serious this investigation was. I 

have a lot of respect for the IG and what an investigation entails. 

I immediately began some activities with respect to the controls 

and the immediate leadership in the region. But I have to say I respected the investigation and I did not want to act on inconclusive 

material. It was not the final report. And until I got the completed 

final report I did not feel I would be doing anything but interrupting what was an investigation, which my deputy had requested. So the fact that it took an additional 9 months was not 

what I was expecting at that point. That was a wrinkle in this 

problem that was very difficult to manage around. I did—— 

Mr. DENHAM. The IG—an investigation is a very serious thing, 

is it not? 

Ms. JOHNSON. It is a very serious thing. And the initial report 

indicated a number of things that were very concerning. It was an 

inconclusive report. It was not—— 

Mr. DENHAM. Yeah, inconclusive. But you have the inspector 

general here. Mr. Miller, did you inform Ms. Johnson about this potential fraud, waste and abuse and did you tell her to get a handle 

on Mr. Neely’s travel, on the entire regional conference’s travel? 

Mr. MILLER. We went through the PowerPoint very clearly. 

Mr. DENHAM. Did you tell her to get a handle on it? We went 

through a lot of this already. I just wanted to know whether you 

told her to get a handle on it or not? 

Mr. MILLER. I told the regional administrator in August to get 

a handle on Mr. Neely’s travel. When I talked to Administrator 

Johnson, I told her directly that I thought that Mr. Neely needed 

to be candid with our special agents because in the interview he 

said some things that we thought were less than candid and I 

thought that was not appropriate for a Senior Executive Service official. 

Mr. DENHAM. Ms. Johnson, you said you took immediate action. 

You took immediate action 2 days ago. This is a pretty scary report. 

Ms. JOHNSON. I agree. 

Mr. DENHAM. I mean yes, certainly you want to see the overall findings. But to see that they spent $1 million in Las Vegas is right 

here. To see what they spent it on, to see the pictures of the 2200- 

square-foot rooms, to see that they went well over their budget. We 

92 

have a completely separate investigation going on now because you 

failed to take action. It has in here in this initial report of May of 

last year that they had nine different trips. It certainly has, while 

inconclusive, at least the initial appearance that laws have been 

broken, criminal acts have been committed. I guess the very simple 

question is if you took this serious why did you not act, why didn’t 

you stop all travel, why didn’t you make serious adjustments, why 

didn’t you make the budget—bring the budget out then and allow 

this committee at the very minimum to see what was happening 

in the budget? 

Ms. JOHNSON. At the time, as I said, I highly respected that the 

IG was undertaking a very serious investigation. To preclude what 

would be the conclusions of that investigation I was concerned 

would in some way taint the ability we would have to discipline. 

I took it very seriously, Congressman. I can only say that I took 

it so seriously I gave up my public service career. 

Mr. DENHAM. A year-and-a-half later. And during this time nobody was fired, nobody was put on administrative leave. You had 

a report back last May that showed all of these trips, that showed 

how much over budget they went. Now, you may not have very 

good controls over your budget, which I find appalling, but that report last May shows you the numbers. So if you didn’t have control 

over your own budget, the inspector general is now telling you 

what is in your budget, how much over budget they went, some of 

the egregious acts and some of the criminal action, and you took 

no action during that time. 

Ms. JOHNSON. I did take some action. 

Mr. DENHAM. Was anybody fired? 

Ms. JOHNSON. I appointed a regional administrator, I set up a 

centralized office to oversee GSA travel, conferences and procurement, and we continued what had been a very strenuous effort 

around disciplining and streamlining conferences that I can go into 

detail about. 

Mr. DENHAM. Ms. Norton. 

Ms. NORTON. I want to make sure we draw a line between what 

might have been mixed in the chairman’s questions. On the one 

hand he talks about people fired and administrative leave, on the 

other hand he raises a serious question about expenditures and 

what could have been done. Now, the reason I raise that is because 

of an email I have from Mr. Miller’s deputy which—this is on May 

3, 2011—I am sorry, on July 25, 2011, indicating that the May 3rd 

report was an interim report and, and I am quoting the email, our 

purpose in issuing the interim report was to alert GSA to potential 

waste and abuse so GSA could take steps to avoid future issues. 

So that speaks to the first part of the chairman’s question about 

reining in spending. The second part warns, please be advised that 

the investigation is ongoing and no personnel action should be 

taken until you have received the final report. I view that to read 

that you could not have put people on administrative leave and you 

could not have fired people until the final report. 

Is that true, Mr. Miller? 

Mr. MILLER. I think the point of the last part is adverse personnel action and that is firing someone. If they wanted to restrict 

travel that was fine, if they wanted to restrict conference planning 

93 

that was fine. They also had the final Hats Off report that implicated misconduct on the part of the regional commissioner. If they 

wanted to take action on that report that was fine; if they wanted 

to fire or put on administrative leave, all that would have been 

fine. 

Ms. NORTON. So I think the chairman’s question, if we can leave 

aside what Mr. Miller’s deputy had warned you about, which is 

taking personnel actions, and that would have meant putting people on administrative leave, that would have been firing people, the 

deputy does seem to say, indeed almost seems to encourage, because he uses the word ‘‘alert,’’ alert GSA to potential waste and 

abuse so GSA could take steps to avoid future issues. That is why 

I want to give you every opportunity to outline whether or not you 

took that as a warning that you should move ahead on the spending and expenditure issues even though you could not take the action you ultimately took with respect to administrative leave and 

discharging employees? 

Ms. JOHNSON. I believed upon hearing the report and knowing 

about the Hats Off situation that we had a number of issues 

around—— 

Ms. NORTON. Did you do anything about the Hats Off at that 

point? 

Ms. JOHNSON. Deputy Administrator Susan Brita and Steve 

Leeds were briefing me on it. I do believe, the best of my remembrance, and again I do not have any of my material, so bear with 

me on that and I can try to check it out if I need to, but they were 

updating me on the status of the Hats Off investigation. The CFO 

was doing a report about the various regional—— 

Ms. NORTON. Did you ultimately—before you left did you ultimately eliminate Hats Off in that region? 

Ms. JOHNSON. I understood that we had, yes. The—— 

Ms. NORTON. You understood that we had. I mean, whose job 

was it? 

Ms. JOHNSON. I was being briefed by Steve Leeds and Susan 

Brita, my deputy administrator and my senior counsel, both who 

had been in those activities and both of whom had met more often 

with the IG than I was able to meet. Susan, Ms. Brita, was the 

deputy administrator and she was the chief operating officer, and 

we have processes by which we are formally interacting with the 

IG. 

Ms. NORTON. Ms. Johnson, in retrospect if you had to do it all 

over again, would you have taken more affirmative steps to rein in 

the spending and to get a foothold on the excesses in spending and 

in conduct that were reported that you might have done something 

about? 

Ms. JOHNSON. Hindsight is always much better than current vision. I believe I was working from the best understanding I could 

make of what my—of what the situation was. There were a number 

of levers that I was pulling, putting leadership into the region. As 

I believe Alison Doone mentioned, she and—or maybe it was Bob 

Peck—she and Bob Peck and I had met—— 

Ms. NORTON. You don’t believe other actions, given what you 

knew at the time, should have been taken? 

94 

Ms. JOHNSON. I believe action should have been taken. I believe 

that—I believe other actions were being taken. I was—I dealt—I 

tasked my commissioners and my senior staff with various issues 

and responsibilities. I assumed that they were managing accordingly. They were part of this. My deputy, my senior staff, my senior 

counsel, and the commissioner and I were hearing that things were 

moving. So I was assuming it was going on. I did not review in a 

line item way all of these things with each one of them all the 

time. 

I do want to go to the point about the financial controls. The 

CFO, Bob Peck, and I had met and were beginning to move in the 

direction of consolidating the financial reporting structure that you 

asked about earlier. And I am heartily in agreement with the need 

to pull much more, much more of that reporting structure into the 

central office of the Public Buildings Service. 

Ms. NORTON. Thank you, Mr. Chairman. 

Mr. DENHAM. We will get back to this timeline here in a minute, 

but you are an administrative appointee. You are appointed by the 

President. 

Ms. JOHNSON. Yes, I was and approved by the Senate, uh-huh. 

Mr. DENHAM. You were approved by the Senate when? 

Ms. JOHNSON. I think in February—— 

Mr. DENHAM. When did your confirmation—— 

Ms. JOHNSON. In February 2010. 

Mr. DENHAM. The Commander in Chief appoints you to a position. I assume that you follow his directive? 

Ms. JOHNSON. I certainly tried to. 

Mr. DENHAM. December 22nd, 2010, Executive Order 13561, Adjustment of Certain Rates of Pay. The Executive order was given 

by the President in December of 2010, prior to you being confirmed 

as an appointee. Why would you not follow that directive by the 

President? 

Ms. JOHNSON. I am not sure I can speak to that substantively. 

I assumed that directives from the President about salaries and so 

on flowed through OPM and we received them in our human resources office and responded. 

Mr. DENHAM. Were you giving raises? 

Ms. JOHNSON. I believe that there are—I believe the raises that 

were allowed were within a grade. But I don’t have a lot of detailed 

knowledge about that nor substantive memory of it right now. 

Mr. DENHAM. Did you give bonuses? 

Ms. JOHNSON. We did give bonuses to the senior executives, yes. 

Mr. DENHAM. Did you give a bonus to Mr. Neely? 

Ms. JOHNSON. We did give a bonus to Mr. Neely. 

Mr. DENHAM. Why? 

Ms. JOHNSON. The recommendation from the Performance Review Board chaired by Ms. Brita was to give him a 3. I asked Ms. 

Brita if they had discussed in the review the IG report and where 

it was. She said there was virtually no mention of it in the meeting. I can’t remember her exact words, but she said that they did 

not consider that in their deliberations of recommending a 3. 

The buildings commissioner recommended a 4. He said that 

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folio, was the strongest across the country, and that fit with a 4 

recommendation. 

I appreciate the issues between conduct and performance, but 

both recommendations given to me were based on these performance measures, and I accepted the commissioner’s recommendation. 

Mr. DENHAM. You have a report that has been issued by the IG. 

I got to say, if the IG called my office, I think everybody in our office would snap to attention. I mean, the FBI comes into your business? You bet people pay attention. Now, if the FBI came back to 

a business and issued a preliminary report, do you think that—let 

me back up. 

Mr. Miller, when you go into somebody’s office and you issue a 

preliminary report, what happens? 

Mr. MILLER. People pay attention to the report. They read it. 

They try and—— 

Mr. DENHAM. They pay attention. They take the recommendations you give serious? 

Mr. MILLER. Yes. 

Mr. DENHAM. OK. And you gave some recommendations in this 

case? 

Mr. MILLER. Well, it was an interim report. So we went through 

the interim report, and—— 

Mr. DENHAM. You gave the top execs a heads-up? 

Mr. MILLER. Yes. 

Mr. DENHAM. ‘‘There is a problem here. We have identified there 

is a problem. I just want to let you know that we are going to dig 

deeper.’’ 

Mr. MILLER. Yes. And there is a big problem. 

Mr. DENHAM. Mr. Neely is mentioned several times by name all 

over this report. 

Mr. MILLER. Yes, sir. 

Mr. DENHAM. Ms. Brita comes back and says that—part of this 

commission—he should not be approved for a bonus. The President 

issues an Executive order on December 22nd of 2010. 

So between the President’s Executive order to his appointed secretary and Ms. Brita coming back and saying he should not be recommended for a bonus, and your IG report that shows, at a minimum, egregious behavior, but probably some criminal action—obviously, the DOJ—we are not going to name names, but the DOJ 

has been alerted to criminal action. We have dismissed people from 

this committee because of that. 

Mr. MILLER. Yes. And she also had a final Hats Off report that 

identified bad behavior on the part of the regional commissioner. 

Mr. DENHAM. So if you are taking the Commander in Chief, the 

President who appointed you serious, and you follow his direction, 

and he issued an Executive order, and your own committee staff 

said that this is not a good idea, why did you move forward? 

Ms. JOHNSON. The President—the Performance Review Board 

was recommending bonuses. I don’t believe they were covered by 

the President’s Executive order. We were encouraged to and we 

were reducing the amount of the bonuses substantially. 

The Performance Review Board made a recommendation to me 

of a 3, which could have carried a bonus. They recommended the 

3, the commissioner recommended a 4, and I accepted the 4. 

96 

Mr. DENHAM. If the FBI came to my business and said that they 

were investigating several individuals, I can tell you, those individuals would not be traveling, those individuals would not be getting 

raises or bonuses. And you had the equivalent of that, the inspector 

general coming to you and saying that there is an issue. Not only 

saying that there is an issue, ‘‘Heads-up, we have an investigation 

going on,’’ but they gave you documentation back that you then 

shared with other people in your agency. 

Is that customary, to share that information? 

Ms. JOHNSON. I did not share that information with anyone else. 

Mr. DENHAM. You didn’t give it to anybody? 

Ms. JOHNSON. No, I did not. 

Mr. DENHAM. How did Bob Peck get it? How did Mr. Neely get 

it? 

Ms. JOHNSON. Ms. Brita and Mr. Leeds and Bob Peck and Michael Robertson and I discussed the entire matter together in a 

meeting. It was a meeting in which we reviewed what was happening. We agreed it was egregious, it was of high concern. And 

we—— 

Mr. DENHAM. Who was at the meeting? 

Ms. JOHNSON. The deputy administrator, the Chief of Staff, the 

commissioner, the senior counselor, and myself. 

Mr. DENHAM. Mr. Robertson, Mr. Peck, Ms. Brita—— 

Ms. JOHNSON. Mr. Leeds and myself. And we discussed this report, and we agreed it was egregious. And we were eager—we were 

eager to get the final report so we could act. It took 9 months before we were able to receive a final report. I will say that, had I 

had that report earlier, I felt I could have moved much more 

strongly with respect to—— 

Mr. DENHAM. We will come in deeper into those details. 

Mr. Walz? 

Mr. WALZ. Well, thank you, Mr. Chairman. 

And, Ms. Johnson, I want to make sure I avoid gross generalizations, and due process. And I, myself, and I know this committee 

as a whole, the interest is not for grandstanding. And while the 

loss of your career is personally tragic to you, I will have to tell 

you, if you will excuse me, my concern lies with the taxpayers 

today. And regardless of what happened here, I don’t doubt your 

sincerity that you are sorry this happened, but I hope you recognize the magnitude of how far this reaches. 

And it is just incredibly difficult for me to imagine that this happened, having worked in different organizations and seen it. I 

think your analysis was very honest about the organizational, your 

matrix design, or whatever. But, I mean, first-year graduate students can do a GAAP analysis and see there were problems here. 

And it doesn’t appear like that was done. And waiting for—I am 

not going to pass judgment other than what we have seen here. 

There are certainly some problems. 

I want to turn here a little bit here, Mr. Tangherlini, to you. How 

did you get this job? 

Mr. TANGHERLINI. I was asked by the White House to step in. 

Mr. WALZ. What were you doing prior to this? 

97 

Mr. TANGHERLINI. I was the assistant secretary for management 

and chief financial officer of the United States Department of 

Treasury. 

Mr. WALZ. And do things at Treasury work the same as you see 

working at GSA? 

Mr. TANGHERLINI. Based on what I have seen just through this 

report and the little I have seen, no, they do not. 

Mr. WALZ. I have a question on this. Now, you came in, you 

made a command decision, you canceled 34 conferences. What was 

your criteria to determine that those were wasteful? 

The reason I ask this is, professional development and conferences for personnel and for professional employees isn’t necessarily a bad thing if they are done correctly. And that internal 

personnel development—I see it in myself as a teacher. The professional development communities we put together, while we didn’t 

go offsite and while we had coffee that someone made in the back 

room, that gathering together was certainly valuable. And I would 

make, in the long run, our outcomes for student achievement were 

improved by those. 

How did you determine these 34 weren’t going to live up to the 

standards of professional development? 

Mr. TANGHERLINI. We cancelled those actions pending the outcome of people providing us with some explanation as to the value 

of those. There was no centralized program by which people would 

explain in detail the value of the activity they are undertaking. 

And I am not saying that there isn’t value to these activities—— 

Mr. WALZ. There was no outcome-based approach to this that 

said this is what it was. We had standards that said this is what 

our professional learning community was going to do during the 9- 

month school year. Here was our July meeting, our August meeting, these outcomes. And then they were measurable by performance reviews and outcomes that were metrics. 

Were any of those available for these professional developments? 

Mr. TANGHERLINI. I am not sure about these in particular, but 

I will tell you, there is a combination of both conferencing and the 

formal training. The formal training actually does have those kind 

of metrics, and we are doing whatever we can to preserve those 

trainings. However, we are also asking the employees of the agency 

to see if there are non-travel-based approaches that we can use to 

get that training, to get that activity. 

Mr. WALZ. I would assume in-house that your trainers are following best practices and all that. That is why I am still amazed 

by this. There had to be professional trainers at this thing. What 

a waste of time. 

It is like pulling teeth to get money for professional development 

in any organization, let alone governmental organizations. Didn’t 

somebody say, this is going to kill our opportunity? Because you 

know this, Ms. Johnson. When is the next time we are going to get 

meaningful professional development conferences in GSA? Not in 

our lifetime. That is the destructive outcome of this, and that is 

going to be detrimental for the services that need to be provided. 

So I ask you, Mr. Tangherlini, the SES folks, this Mr. Neely, I 

wish he was here today, too, because I am kind of like Ms. Norton. 

This guy set up a fiefdom. Not since Jack Abramoff has anybody 

98 

walked in with such swagger and ability as what it appears like 

this guy was able to do. 

Here is what I would tell you. These SES folks, I have seen some 

of the most dedicated professional public servants that I have ever 

come across in both private and public sector in my life, and I have 

also seen some of the worst obstructionists. How are you going to 

deal with SES? 

These folks simply—many of them have an attitude that they 

will outlive you. The next President will come, and you will be 

gone, and they will continue. Apparently, that is what Mr. Neely 

did. This guy has been around forever. He outlasted Ms. Johnson. 

Whether he outlasts you or not will be seen what comes out of this. 

How are you going to address that with SES? 

Mr. TANGHERLINI. I think that is a great question, Congressman, 

and I think that that is part of what we have to look at in our topto-bottom review, is what kind of performance system do we have 

in the General Services Administration? How do we create a system that measures conduct as well as performance? And then, how 

do we hold people accountable to it? So I am committed to doing 

that, and I look forward to working with you on that. 

Mr. WALZ. Because there is the taxpayer in this, the services we 

could be providing. But, you know, there are comparable people out 

there that serve in the position that Mr. Neely did, and I would assume some of them are performing absolutely admirably. Could 

probably take their talents and go into the private sector and make 

more money; they have chosen not to because they are trying to 

serve. Every one of those is painted with the same brush now. 

We have to, and what the chairman has been asking for is, is I 

just encourage you, Mr. Tangherlini, in this, is transparency and 

sunshine is the best disinfectant for everything. Err on the side of 

over-giving, just as my advice. 

And I yield back. 

Mr. TANGHERLINI. Thank you. 

Mr. DENHAM. I want to go back to this timeline. So this big, extravagant trip takes place in October 2010. There have already 

been nine different trips, pre-planning trips, associated with it. Ms. 

Brita gets hired; she blows the whistle in November. The IG comes 

in. IG alerts you he is coming in. IG comes back with an initial document, says, ‘‘We have a problem here.’’ He advises you to get a 

handle on the travel. 

Then your Chief of Staff goes to the White House, let’s them 

know there is an IG investigation going on regarding fraud and 

wasteful spending related to the Western Regions Conference. Then 

we have a new appointee, Ruth Cox, regional administrator for Region 9. She is advised, ‘‘Get a handle on the regional commissioner.’’ 

Then in October of last year—and there are a number of other 

trips. I have looked at all the different trips that he has taken. And 

we are going to continue to investigate that as a separate issue because you didn’t take care of it. But in October, a 9-day trip to Hawaii. In November, a 5-day trip to Atlanta for a non-training conference. 

In December, Ms. Brita is alerted to this 17-day junket to the 

South Pacific. She alerts Mr. Miller, and Mr. Miller alerts you. And 

99 

yet he is still allowed to go on it? And his wife? Their birthday trip? 

You don’t see a pattern here? A pattern that you have been aware 

of for the last year-and-a-half. But you took immediate action. That 

doesn’t sound like immediate action to me. They went on a 17-day 

trip to Hawaii, Guam, Saipan. 

And then in March, this year, last month, a 4-day visit to Hawaii 

again, 4-day offsite trip to Napa for an executive team meeting, 

$40,000, excluding travel expenses. 

You took immediate action? You got a recommendation from the 

IG, ‘‘Get a handle on it.’’ You got a new administrator, ‘‘Get a handle on it.’’ What immediate action did you take? 

Ms. JOHNSON. First of all, Congressman, I did not know about 

those trips. I knew that the IG, as he has said—— 

Mr. DENHAM. You knew about the nine pre-planning trips and 

the Vegas trip, did you not? 

Ms. JOHNSON. I learned about those last May, yes. 

Mr. DENHAM. You heard—no, no, no. You are under oath. You 

heard about them when? 

Ms. JOHNSON. I learned about the Vegas trip in—well, I learned 

about the Vegas conference in September 2010 when I understood 

that my senior counselor was going to attend a conference in the 

Western Regions. That is when I learned about the conference. 

Mr. DENHAM. So you knew about the conference and the preplanning trips before the IG came in. The IG came in—— 

Ms. JOHNSON. No, I did not. No, I did not. I did not know about 

the pre-planning conferences. The IG informed me of the pre-planning conferences. It was through the IG’s office and our investigation, which my deputy requested, that we learned the extent of the 

expenditures, the frivolity, the contracting violations. 

Mr. DENHAM. On May 3rd of last year, you were made aware. 

And you had a meeting with Mr. Peck, Ms. Brita, several other 

people—— 

Ms. JOHNSON. Yes, my senior staff. 

Mr. DENHAM [continuing]. To discuss this. 

Ms. JOHNSON. We discussed this. 

Mr. DENHAM. And the immediate action that you say you took 

was what? 

Ms. JOHNSON. The—— 

Mr. DENHAM. Did Mr. Neely go on any more trips? 

Ms. JOHNSON. I do not know about Mr. Neely’s travel. 

Mr. DENHAM. Yes, he did, a lot. You didn’t know about any of 

his travel? 

Ms. JOHNSON. I did not know—I did not track his travel, no. 

Mr. DENHAM. Did you know about any of his travel? Did anybody 

ever tell you he had upcoming trips? 

Ms. JOHNSON. I believe that summer, in August, there was a 

meeting of all of the regional commissioners in Austin. I believe he 

was there, so I knew he had traveled to Austin. I was not monitoring his trips personally. I had had—— 

Mr. DENHAM. The IG said, get a handle on it. Why wouldn’t 

you—— 

Ms. JOHNSON. He gave that instruction to the regional administrator. 

100 

Mr. DENHAM. The President had an Executive order. We are cutting Government. 

Ms. JOHNSON. Right. 

Mr. DENHAM. We are seeing cuts to the military, to veterans. The 

President sure sees it is a big issue. There are seniors being cut. 

And the inspector general comes to you—— 

Ms. JOHNSON. To the regional administrator. He said that—he 

said that himself. In August, he informed the regional administrator she needed to get a handle on his travel. I had just put her 

into office. 

Mr. DENHAM. ‘‘OIG also advised Administrator Johnson to get a 

handle on the RC’s travel.’’ Did the IG get it wrong? 

Mr. MILLER. If I could clarify, I did speak to the regional administrator in August of 2011, and I told her to get a handle, to get 

control of Mr. Neely’s travel, and to perhaps get her CFO to look 

at his travel. 

In May, when I met with Administrator Johnson, I went through 

the interim report that has the eight pre-planning trips to Las 

Vegas and exactly who was at these trips, which includes Mr. 

Neely at many of them. 

Mr. DENHAM. I will ask you one last time. What was the immediate action you took when you received this report from the IG? 

Ms. JOHNSON. There were a number of things I did. One is I appointed Ruth Cox into the regional administrator’s office, the job in 

Region 9. I also began the process of creating a centralized office 

with chief administrative services offices pulling in a lot of the 

oversight across the agency for travel conferences, FOIA, a number 

of other things. 

And we continued to work on an agenda that we had had undergoing to streamline and shorten conferences GSA runs, and we 

were quite focused on reducing their size and their scope. I can give 

you more detail on that if you would like. 

Mr. DENHAM. Ms. Norton? 

Ms. NORTON. Ms. Johnson, you are very experienced in Government. This is why the President appointed you to be administrator 

of GSA. In fact, that was, if anything, a promotion, because you 

had been at GSA before, had done such an incredible job. And I 

think everyone recognizes that, up until this point, you had had a 

very distinguished career. 

One thing that those of us who have been in the Federal Government are used to are GAO reports. I am not here talking about IG 

reports. The GAO reports can be particularly deadly. And what 

agency heads and supervisors do when they see the GAO on the 

job is to rush to get in front of the GAO report so that, by the time 

it comes out, they are able to say, we have already done XYZ. It 

is almost a given if you run an agency. Here you had virtually run 

an agency before, and now you ran an agency, which is why I think 

you are getting these questions. You are not a novice. You had a 

storied career. And it is hard to understand why you would not 

have treated—and let me go to the bonus. 

The bonus, much like I treat someone or I am sure most people 

do, when you were asked to do a recommendation to someone, the 

first thing I think about is, ‘‘Wait a minute, this is on me now. If 

I recommend that person and that person messes up, my reputaVerDate Aug 31 2005 13:48 Jul 26, 2012 Jkt 000000 PO 00000 Frm 00110 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\ED\4-17-1~1\73825.TXT JEAN
101 

tion is attached to that person.’’ That is what has happened to you 

with the bonus. 

You had a specific recommendation after the interim report, after 

the report, that Mr. Peck—or no, Neely—excuse me—was to receive 

a 3. Apparently, Mr. Peck lobbied and he got a 4. I understand Mr. 

Peck can be persuasive. Your own committee, though, had looked 

at all of the circumstances and come out with a 3. And you had 

knowledge of, you knew, or, as it goes in the law, you knew or 

should have known about the interim report and that much of that 

involved a commissioner, a PBS commissioner. 

It is hard to understand why you didn’t understand that you 

would be implicated, personally, after you knew the interim report 

was out and what it said, if you actually raised this man beyond 

what your own committee had said. That is why it is difficult to 

understand how you, in light of your knowledge of the interim report, would have felt it necessary to give Mr. Neely a bonus. That 

is what it is, a bonus, and a bonus recommended by you, overruling 

your own committee. 

And I wish you would—I wish you would make us understand. 

Was it that Mr. Peck offered factors that overcame the committee, 

overcame the interim report? Make us understand why you would 

have raised that from a 3 to a 4. 

Ms. JOHNSON. Congresswoman, there are two responses I can 

give. 

The first is, as I have said, I treated the interim report as inconclusive. It was not the final report. Had I had—— 

Ms. NORTON. In other words, you thought that the—— 

Ms. JOHNSON [continuing]. The final IG report—— 

Ms. NORTON. Well, wait a minute. 

Mr. Miller, weren’t the allegations in the interim report substantiated? And wasn’t the point of the interim report to say that there 

were other things that were going to come out, not that what was 

in the interim report should not be given value? In fact, didn’t your 

deputies say, ‘‘You should give it value’’? 

Mr. MILLER. Right. 

Ms. NORTON. ‘‘That is why we are bringing it to your attention.’’ 

Mr. MILLER. Right. What is in the interim report is that there 

is a problem. We may not have the precise numbers, you know, we 

may adjust the numbers from the interim report to the final, but 

this was basically it. 

She also had the final Hats Off report that was final at the end 

of June. And she also had my—— 

Ms. NORTON. Now, Hats Off was under Mr. Neely? 

Mr. MILLER. Correct. 

Ms. NORTON. And there were accusations that went to Neely’s 

conduct. 

Mr. MILLER. Conduct, yes, identified in that report. When I 

briefed Administrator Johnson, I also mentioned that he was less 

than candid, in our opinion, to our special agents when interviewed. 

Ms. JOHNSON. Congresswoman, if it was just short of a final report, why did it take 9 months to get it to me? As the time went 

on—— 

102 

Ms. NORTON. Just a moment, Ms. Johnson. Are you criticizing—— 

Ms. JOHNSON [continuing]. I was concerned—— 

Ms. NORTON [continuing]. The IG for not having rushed through 

to the report? He provides you with an interim report, knowing full 

well that it is taking him longer than he expected. He was finding 

far more problems than he expected. So he says, why don’t I do 

something here to alert the top people so that they know to proceed 

now before my final report. 

So how can you criticize Mr. Miller in this for not having gone 

faster? I am glad he didn’t go faster because he uncovered—— 

Ms. JOHNSON. Yes. 

Ms. NORTON [continuing]. Much by not going faster. And, by the 

way, he is still at it. 

Ms. JOHNSON. Yes. And I am—and we asked for the investigation, and it was clearly quite serious because it was taking the kind 

of time and attention it did. 

And so I was—were I to have had the final report when I made 

the bonus decision, I would not be here explaining about a bonus. 

I would not have made that bonus decision. 

Mr. DENHAM. This is a good point for us to transition back to me 

again and follow up on that same question. 

Let me go through what you did know. You knew that they spent 

four times what they were budgeted, because it says that right 

here. You had this report, you discussed it with your staff, you discussed it with Mr. Peck. You knew that they had 300 people that 

went to Las Vegas. You knew that they had spent $250,000 on a 

variety of different trinkets. You knew about the Hats Off Program 

and all of the money that they spent there. You knew about the 

pre-planning meetings and the dry run, meetings where 31 people 

went to a planning conference, 20 people, 8, 15, 65. Nine different 

planning trips. You knew about the comped rooms in Caesars Palace. You new about the comped rooms at the Ritz Carlton. You 

knew that there were many different individuals that were taking 

these trips. You knew about the vendors and the possibility of improprieties and kickbacks. 

You knew about the team-building exercise. You knew about the 

clowns. You knew about the videos. You knew about the $75,000 

for the bicycles. You knew that there was a legal question that was 

brought up and then swept under the table because they didn’t 

want it in writing. You knew about the coins that were printed up 

for this, the $6,000 stimulus coins. You knew about the spending, 

nearly $3,000 per attendee just for the one conference in Vegas 

alone. You knew that they didn’t follow legal requirements. Again, 

several laws being broken. 

You knew that this went well beyond Neely. But I think that 

Neely provides the best example of why this goes to the level of 

fraud, waste, corruption. And had he been here today, we would 

have a lot more questions for him as well. But he has a good reason to have a lawyer. 

I have looked at both this original, a year-and-a-half ago, as well 

as the final draft. But I can tell you one thing that is very clear 

to me, one thing that I think is very clear to Ms. Norton and the 

entire committee. I mean, it doesn’t take a whole lot to take a look 

103 

at all of these various picture, parties, see the birthday parties, see 

the families and friends that are traveling—and understand that 

there is an IG—the first IG investigation going on. 

May of last year, you had all of this information that I am holding in my hand right now that I just went through on a top line. 

I can tell you, I wouldn’t have had anybody traveling. I can tell 

you, I wouldn’t have given anybody bonuses, especially when the 

President that appointed you had a directive. 

And your Chief of Staff, Michael Robertson, lets the White House 

know last June. And you still allowed Neely to take all these trips 

and you knew about it? How is that immediate action? I am surprised that the administration, that the President didn’t take immediate action. I am assuming that somebody in the White House, 

somebody in the administration said, ‘‘Hey, how is that IG report 

coming? That investigator come up with anything else? We saw a 

copy of this; it is pretty bad.’’ 

If he is giving you regular meetings, I would assume the White 

House would have somebody going, ‘‘Oh, boy, this is really going to 

look bad. Maybe we ought to get some regular meetings too. And 

if Martha Johnson is not doing something about it, maybe we need 

to replace her. And if Bob Peck is not doing something about it, 

maybe we need to replace him. Maybe we need to put Mr. Neely 

on administrative leave in May of last year rather than waiting 

until the American public finds out about it.’’ 

Nothing happened for a year? And you allowed all of these trips 

to continue on? Multiple conferences? I mean, I can appreciate Mr. 

Tangherlini coming in and suspending the 35 conferences that are 

scheduled. How were they even scheduled? How didn’t you stop 

those conferences? I am amazed that, with the recommendation 

from Mr. Miller, that more wasn’t done to stop this over the last 

year. 

Mr. Miller, I want to go back to something you said. You are 

going to be exhausted by the end of this week. In fact, I assume 

all of you will be. I don’t know that—you know, I am a freshman, 

I have only been here for a year-and-a-half, but I have not seen 

four committee hearings on any topic yet. 

But in yesterday’s testimony, Mr. Cummings, Congressman 

Cummings, asked you a question. It took 9 months to investigate. 

Ms. Johnson indicated that she was surprised it took that long. 

Were you communicating with her regularly about the progress in 

the investigation, and you replied back, ‘‘Yes, we provided information. The briefing—and I asked her to get a handle on the RC’s 

travel.’’ You testified to that yesterday. Did you misspeak yesterday? Are you misspeaking today? 

Mr. MILLER. Well, I must have misspoken yesterday. I specifically told the regional administrator in Region 9 to get ahold of his 

travel in August of 2011. I did brief Administrator Johnson in May 

of 2011 on the interim report. And we went through the interim 

report. She saw the pre-planning travel. I did tell her about the 

less-than-candid comments. And, of course, we also had the Hats 

Off report that she was fully briefed on. 

Mr. DENHAM. How often were you meeting with Ms. Johnson? 

Mr. MILLER. We met in May, May 17th I think. And then we met 

again in August. I don’t think we met before that. 

104 

Mr. DENHAM. I can’t imagine that you had any of these meetings 

where you didn’t say, ‘‘We have a big issue here.’’ 

Mr. MILLER. Yeah. We met in August, I think maybe twice in 

August. 

Mr. DENHAM. And during that same period of time, were you also 

meeting with other people that worked within GSA? 

Mr. MILLER. Indeed. And my senior staff is in constant touch 

with senior staff throughout GSA. And—— 

Mr. DENHAM. How often do you think you communicated, whether it is between staff to staff or you with Ms. Johnson? No matter 

what level, how often is it? 

Mr. MILLER. Oh, I think we communicate several times a week 

between our staff and staff at GSA. And I know that my deputy 

communicates regularly with the deputy administrator, and I believe they did so about this investigation. And I communicated with 

Steve Leeds, as well, about this investigation. 

Mr. DENHAM. Did anybody from the administration ever contact 

you? 

Mr. MILLER. No one from the White House has ever contacted 

me. I have never spoken to them about this report. 

Mr. DENHAM. So several times a week the OIG contacted GSA 

and let them know—— 

Mr. MILLER. Well, we contacted—— 

Mr. DENHAM. As you found new stuff, did you let them know? 

Mr. MILLER. No, because it is an investigation, and we need to 

keep the investigation confidential in order to do the investigation. 

And when we contact people throughout GSA, it is about many 

matters. We are involved in audits, we are involved in many 

things. So the contacts between my office and GSA are on many 

topics. 

Regarding this—— 

Mr. DENHAM. Let me understand the OIG’s—you know what? My 

time has expired. I will come back to this. 

Ms. Norton? 

Ms. NORTON. Thank you, Mr. Chairman. 

Now, occasionally, the distress of the committee comes out. I 

think one of the Members said, you know, we ought to just get rid 

of—perhaps we ought to just get rid of GSA. Well, it is precisely 

because GSA serves an indispensable function in the Government 

that this is such a serious matter. So we have to do it the hard 

way. 

And I am looking—I am trying to be as remedy-oriented as I can. 

On the one hand, there are issues of misconduct. Either the law enforcement system, our hearings will bring out some, or the system 

within GSA now under Mr. Tangherlini are going to ferret those 

out. 

But we are still going to be left with the existing structure. I believe in good personnel, but I don’t believe that the Government or 

any other agency or private business can always assure that there 

will be precisely the people in charge who will keep things going. 

So I am therefore looking very carefully at the structure. 

And, Ms. Johnson, the structure you found in place had been put 

in place by an acting GSA administrator. He is now on administrative leave because he was in real life a PBS commissioner. His 

105 

name is Paul Prouty, I understand it. He is apparently responsible 

for the present structure of the region at GSA. 

Now, the regional administrator is a political appointee. But 

under Mr. Prouty, that administrator apparently was made no 

more than a figurehead. You say you appointed Ms.—I forget her 

name. 

Ms. JOHNSON. Ruth Cox. 

Ms. NORTON. Yes, the new administrator. But as it appears from 

his organization of the GSA, before his organization, or shall I say 

reorganization, the regional administrator apparently had direct 

control over the two commissioners—the PBS commissioner, the 

FAS commissioner. 

Under his reorganization, that was no longer the case, and you 

have the reporting straight up that we have talked about today. It 

looks as though this person you appointed was something like a figurehead, just the way the CFO, also called the GSA CFO, was a 

figurehead. And yet, you kept this structure, this structure put in 

place by an acting GSA administrator, when you could have looked 

at it and seen, it seems to me, that your own, it seems to me, your 

own position had been weakened. 

Remember, he is a PBS commissioner. He makes sure that these 

people report around the regional administrator and straight up to 

the commissioners, the respective commissioners. That means, if I 

am coming in, that I am looking at less authority for me, because 

my own person there no longer has the authority that she had before. 

Why did you accept this organization, this form of organization 

that was not put in by a Presidential appointee but was put in by 

someone who acted for a very long period of time when there was 

no Presidential appointee—in fact, he may have gone over into two 

administrations—and left in place this structure that we have now 

with a series of figureheads, including at the regional level, where 

Mr. Neely was able to do his work when he was both regional administrator, of course—and PBS commissioner didn’t much matter, 

because Prouty, before him, had reorganized the place so that the 

regional administrator wasn’t left with much authority anyway. 

And now Prouty is on administrative leave because he is implicated 

in what happened in Region 9. 

Could you tell us whether you were satisfied with the structure 

you found in place and why you left it in place? 

Ms. JOHNSON. The structure that I found in place was one in 

which the regional administrators did the performance reviews of 

the regional commissioners. So, in that sense, they were not toothless. They were not—I can’t remember the word you used. They 

weren’t just figureheads. 

Ms. NORTON. They did the what? I am sorry. 

Ms. JOHNSON. They gave performance reviews to the regional 

commissioners. The regional administrator had to review the regional commissioners. They signed off on it. They got input from 

the commissioners, but they signed off—— 

Ms. NORTON. So what did they have to do with budget? What did 

they have to do with function? You know, this is where you understand line authority. 

106 

Ms. JOHNSON. This is the matrix, yes, this is a matrix, because 

they would receive their budgets from their commissioners, but 

their performance review would come from their regional administrators, who had the ultimate signoff with input from the commissioners. 

And the shift, as I understand it, the shift that happened was 

that the contracting authority, the head of contracting authority 

was moved from the RA to the regional commissioners, and that 

was the change under Paul Prouty. 

Should I have changed that back? I believe it is something we 

should have reviewed thoroughly. It had been in place for a couple 

of years. Frankly, there were so many other things that we were 

undertaking, it wasn’t at the top of my list. Perhaps it should have 

been. 

Ms. NORTON. Look what Mr. Prouty did. As acting administrator, 

he changed the agency so that he went back to his old position as 

PBS commissioner in the region with enhanced authority that he 

himself had made, and your regional administrator had diminished 

authority, and you, yourself, therefore, had diminished authority 

because of it. I have to say, Ms. Johnson, I think you were 

snookered by your own PBS commissioner. 

Ms. JOHNSON. There is one piece to that that makes it a little 

bit difficult. I believe that the way to think about that contracting 

authority is either it came up to me through the regional administrator or it came up through the commissioner. It was still coming 

to me. So I don’t know if it is six, one-half dozen, or seven to five, 

but it was a shift, and it still devolved up to me in terms of contracting authority. 

Ms. NORTON. Mr. Chairman? 

Mr. DENHAM. It was still coming up to you, but you were doing 

nothing about it. That is the issue here. That is why we continue 

to come back around on this issue. 

Mr. Miller, when you do an investigation and you come back with 

this preliminary report, what normally happens? 

Mr. MILLER. Well, this was an unusual report. We did the interim report so that we could stop some of the waste in the future. 

So it is unusual. Usually when we do an investigation, we will complete the investigation, make a referral to the Department of Justice, and there is a criminal prosecution or perhaps a civil case that 

is brought. 

Mr. DENHAM. So, as of May 3rd, you did a preliminary report, 

ongoing investigation, a couple of investigations now, but you did 

a preliminary report—— 

Mr. MILLER. Correct. 

Mr. DENHAM [continuing]. So that you could stop the abuses 

right there. 

Mr. MILLER. Correct. 

Mr. DENHAM. And so, after May 3rd, you started having multiple 

conversations per week with GSA, either through you or through 

your staff, from everybody from Ms. Johnson to Ms. Cox when she 

was appointed. 

Mr. MILLER. Well—— 

Mr. DENHAM. How was it that the spending did not stop? How 

was it that the trips did not stop? 

107 

Mr. MILLER. I do want to clarify that when I said we have multiple contacts, and we have contacts throughout my office, my senior staff contacts senior staff throughout GSA, it is on many different issues. On this particular issue, because it is an investigation and because of the nature of it, we wouldn’t be going out of 

our way to tell GSA people about this, because it is an investigation. 

Mr. DENHAM. But you went out of your way in this case. 

Mr. MILLER. Well, we went out of—— 

Mr. DENHAM. You gave them a heads-up. You let them know that 

there was a big problem here. 

Mr. MILLER. Yes. 

Mr. DENHAM. And you told them to get a handle on RC’s travel. 

Mr. MILLER. I told the regional administrator that in August. 

And we did the preliminary—the interim report in May to alert the 

administrator. 

Mr. DENHAM. You came back in December of last year. Ms. Brita 

alerted you to Mr. Neely’s 17-day trip which he was taking his wife 

on. You got the emails of the party that they were going to have 

and the—— 

Mr. MILLER. It is the other way around. 

Mr. DENHAM [continuing]. The different places they were going 

to travel to. 

Mr. MILLER. It is the other way around. We contacted Ms. Brita, 

the deputy administrator, about the travel and said, ‘‘Do you know 

about this travel? Is it really necessary?’’ And Ms. Brita contacted 

the regional administrator, and—— 

Mr. DENHAM. Ms. Cox. 

Mr. MILLER. Yes. And I believe—— 

Mr. DENHAM. Did Ms. Cox let you know that this 17-day trip was 

going to happen? 

Ms. JOHNSON. I did not know about the trip from either Ms. 

Brita or the inspector general or Ms. Cox. 

Mr. DENHAM. Has Ms. Cox been fired? 

Ms. JOHNSON. I did not fire her. 

Mr. DENHAM. Has she been put on administrative leave? 

Ms. JOHNSON. I do not know. I am not at the agency anymore. 

Mr. DENHAM. Has she resigned? 

Ms. JOHNSON. I do not know. 

Mr. DENHAM. Mr. Tangherlini, Ms. Cox, who was aware of this 

17-day trip, who was made aware of the ongoing OIG investigation, 

has she been fired? 

Mr. TANGHERLINI. No, she has not. 

Mr. DENHAM. Put on administrative leave? 

Mr. TANGHERLINI. No, she has not. 

Mr. DENHAM. She hasn’t resigned? 

Mr. TANGHERLINI. No, she hasn’t. 

Mr. DENHAM. Any reason to believe that she was not aware of 

the May 3rd report? 

Mr. TANGHERLINI. I am still reviewing all of the outcomes of the 

analysis of the inspector general, all of the outcomes of this hearing, and we are still conducting—still undertaking personnel actions. 

108 

Mr. DENHAM. Do you dispute whether Ms. Brita alerted Ms. Cox 

to this 17-day trip that was coming up? 

Mr. TANGHERLINI. I have no reason to dispute that. 

Mr. DENHAM. Is she irreplaceable? 

Mr. TANGHERLINI. I haven’t been there long enough to know who 

on the staff is replaceable or irreplaceable, so that is part of the 

review I want to do—understand who we have, what role they play, 

and how they can continue to serve. 

Mr. DENHAM. Ms. Johnson testifies that she took immediate action. April 3rd, Mr. Peck is fired. April 3rd, Steve Leeds is fired. 

Mr. Neely and four others that represent the different regions are 

put on administrative leave on the 3rd. And I believe that is the 

same day that you resigned, Ms. Johnson. 

This committee gets the information on April 2nd—or we called 

our hearing on April 2nd. And it wasn’t until we called a hearing 

and prepared subpoenas before any action was taken. A year-anda-half prior to that was when you had the May 3rd report. What 

immediate action was taken? 

Ms. JOHNSON. When we received the final draft of the report 

from the IG, we spent some—we absorbed it, we met with the IG 

further to deepen our understanding of the background evidence. I 

called Ruth Cox in to begin some disciplinary activities. I placed 

the regional commissioners—I placed Jeff Neely on administrative 

leave. I placed the regional commissioners on—all four regional 

commissioners on administrative leave, ultimately. I had gone—— 

Mr. DENHAM. Were you directed to do so? 

Ms. JOHNSON. No. No. These were my decisions. 

Mr. DENHAM. Why didn’t you make the decision on Ms. Cox? 

What was different with her? 

Ms. JOHNSON. I admonished all of the regional administrators. I 

then removed the two people in the chain of command who were 

the political appointees. Ruth Cox reported to Steve Leeds. I removed Steve Leeds, and I resigned. So I took out the senior people. 

Mr. DENHAM. Ms. Norton? 

Ms. NORTON. Mr. Chairman, I only have one more question. 

I do want to welcome the seniors from Cardozo High School who 

have come into the room. It is rare for visitors to see a hearing in 

progress. I can’t say this has much to do with the District of Columbia, but Mr. Tangherlini is here. 

And I do want to say for the record that the President took action without hesitation. And the action was not simply to discharge 

some or indeed all of the high officers of the agency. The President 

also brought in Dan Tangherlini. And I can say from my own personal experience that it was an appointment made for this situation. Mr. Tangherlini has been the administrator of the District of 

Columbia, a very big and complicated city; done the same thing at 

Metro. So here as an administrator not only with impeccable management skills but also impeccable ethics. 

But you see what you have laid out for you to do. 

I have one question about these conferences. In one of my other 

committees, we are focusing on teleworking, and we are having, finally, some progress in getting teleworking. I don’t know about 

teleconferencing. And I do want to say this also for the record: As 

somebody who manages people right now in the Congress and manVerDate Aug 31 2005 13:48 Jul 26, 2012 Jkt 000000 PO 00000 Frm 00118 Fmt 6633 Sfmt 6633 P:\HEARINGS\112\ED\4-17-1~1\73825.TXT JEAN
109 

aged much more people in prior positions in my life, I value what 

face-to-face meetings can do. My own staff is in the same city. But 

the district office staff—and there are two district offices—and the 

congressional office staff don’t have face-to-face meetings that 

often, but they have telephone meetings—now, of course, it is a 

much smaller staff than you would have in an agency—they have 

telephone meetings every Monday morning. 

I would like to ask, because I don’t know enough about the value 

of these face-to-face conferences, but I would like to ask you, Mr. 

Tangherlini, since the conference is the vortex of this problem, 

what criteria you will use—I know you don’t know what you are 

going to do now—in determining whether these face-to-face conferences serve a legitimate need. And how much of the work that 

is now being done in face-to-face conferences do you think, in light 

of the priority the Federal Government and the administration is 

putting on teleworking, could be done with more teleconferencing? 

Mr. TANGHERLINI. Well, I have to say that GSA is already a leader in teleconferencing, telepresence, moving out on ideas such as 

webinars. That is one of the things we are asking ourselves to be, 

is more like GSA for GSA, and ask ourselves, can we challenge ourselves to use some of the technology we have developed, challenge 

ourselves to use some of the innovations that have come out of GSA 

over the last several years and use this to overcome the costs associated with some of the travel for conferences and training. 

I will say that we believe that there is huge value in high-quality 

training, interaction between Federal employees who are working 

on the same areas and ideas. When you are dealing with things 

like the Federal acquisition system, you need to have skilled, 

trained people managing those resources, because literally billions 

of dollars go through those folks. And so we want to make sure 

that they have the highest quality training. 

So our chief administrative officer office, which has been set up 

under the former administrator, we have given extra powers to 

oversee these conferences, to oversee the training, to oversee the 

travel. And, in fact, I issued on April 15th guidelines on conferences and travel that ask those questions first: Does this have 

to happen by actually having people come together? Can we use 

Federal facilities instead of renting a conference facility to do this 

kind of training? And what is the value we are going to get out of 

these activities? 

Ms. NORTON. Thank you very much, Mr. Chairman. 

Ms. JOHNSON. Mr. Chairman, could I correct a couple of dates 

here? I just want to be really clear about the record. 

We put Mr. Neely on administrative leave on March 19th. I removed Steve Leeds and Bob Peck and resigned on April 2nd. I just 

wanted to be sure that is in the record correctly. 

Mr. DENHAM. Thank you. 

In June of last year, your Chief of Staff—Michael Robertson is 

your Chief of Staff, correct? 

Ms. JOHNSON. He was my Chief of Staff, yes. 

Mr. DENHAM. He was the liaison to the White House prior to 

that? 

110 

Ms. JOHNSON. Before that he was—well, he was in the policy 

shop for a while, and before that he was the White House liaison, 

yes. 

Mr. DENHAM. He did work on Senator Obama’s staff before Senator Obama became President Obama? 

Ms. JOHNSON. Yes. 

Mr. DENHAM. In June of last year, he informed Kimberly Harris, 

White House counsel, about this report. Did you ever have subsequent meetings with the administration? 

Ms. JOHNSON. First of all, I learned that yesterday in the testimony. I did not realize he had informed anyone at the White 

House. 

Mr. DENHAM. Did you ever inform anybody at the White House? 

Ms. JOHNSON. We held meetings with the White House after we 

received the draft report in—— 

Mr. DENHAM. After May 3rd? 

Ms. JOHNSON. After—sorry? 

Mr. DENHAM. After May 3rd, when the draft—when the report 

came out last year. 

Ms. JOHNSON. No. I did not talk to the White House until after 

the final draft report was delivered to us in late February. 

Mr. DENHAM. Which was when? 

Ms. JOHNSON. When the—— 

Mr. DENHAM. The final. 

Ms. JOHNSON. The draft report came to us at the end of February. February—I don’t have—— 

Mr. MILLER. In terms of terminology, Mr. Chairman, we termed 

the May 3rd report the interim report. 

Mr. DENHAM. Uh-huh. 

Mr. MILLER. And our practice, when we have a final report, we 

give the agency 30 days to respond. At the end of 30 days, we will 

publish everything. We technically call that a draft. And that draft 

report was delivered on February 17th with the 30-day notice, 

which Administrator Johnson asked us to extend it by another 30 

days, which we did. 

Ms. JOHNSON. So after that draft report was delivered to me, I 

was in some discussions with the White House, but not before. 

Mr. DENHAM. You had no discussions with the White House last 

year. 

Ms. JOHNSON. No, I did not. 

Mr. DENHAM. Anybody in the administration above you? I am 

just trying to figure out what the pattern here is and how deep this 

goes. 

Ms. JOHNSON. I did not talk to the White House. I understand 

from yesterday’s hearing that my Chief of Staff spoke to someone 

in June. 

Mr. DENHAM. March 17th you received the draft. 

Ms. JOHNSON. February. 

Mr. DENHAM. I am sorry, February 17th you received the draft? 

Ms. JOHNSON. Right. 

Mr. DENHAM. So what we have up here is the May 3rd preliminary? 

Mr. MILLER. Interim report. 

111 

Mr. DENHAM. Interim report. I want to make sure I use the correct terminology. So almost a year passes by. Nine months passes 

by. You continue your report, you finalize your investigation, you 

put that in a nice package, you give that over to Ms. Johnson on 

February 17th, that is the draft? 

Mr. MILLER. Correct. 

Mr. DENHAM. Your immediate action was what? 

Ms. JOHNSON. We reviewed the report. He gives us the draft report so that we can review it and respond to him, and then he will 

publish the final report with our response. We immediately realized that we agreed with all the recommendations in the report. I 

then contacted our chief human resources officer and our general 

counsel so that I could begin to frame up the disciplinary actions 

that we needed to take. We did that work. We met more with the 

IG. We put Jeff Neely on administrative leave. 

Mr. DENHAM. Wait a minute. You put Jeff Neely on administrative leave March 19th? 

Ms. JOHNSON. Yes. 

Mr. DENHAM. You received the draft report on February 17th. 

You said you took immediate action? 

Ms. JOHNSON. Yes. I received the report. As I said, I consulted 

with our HR staff, with our general counsel. 

Mr. DENHAM. Before you went back to Mr. Miller and requested 

an additional 30 days did you think—did you find some things in 

the report that you thought that were false? 

Ms. JOHNSON. That were false? No, I had no reason to think that 

anything was false. 

Mr. DENHAM. Anything misleading? 

Ms. JOHNSON. No. As I said, I accepted the entire report. 

Mr. DENHAM. So you accepted—you didn’t have any concerns 

about the report itself when you received it on February 17th. You 

asked for an additional 30 days. Why did you ask for an additional 

30 days if you didn’t have any problem with the report? 

Ms. JOHNSON. The amount of material that the IG had as underlying evidence which he had gathered over something like 15 

months was fairly substantial. Our human resource officer and 

general counsel needed to dig into some of that to be sure to be 

able to frame up the letters that we needed to be sending in order 

to put people on various, on the various disciplinary actions that 

we were beginning to take. It was a phenomenal amount of material. And so we—— 

Mr. DENHAM. A lot of material. But did you have any reason to 

believe that Mr. Neely did or did not go on these trips? Did you 

believe that all the trips that were detailed in this report were factual? 

Ms. JOHNSON. Yes, I accepted the report. 

Mr. DENHAM. OK. So if you accepted the report and you didn’t 

put Mr. Neely on administrative leave until March 19th, why 

would you let him go on a 17-day trip that you have got emails on 

that show that it is a party for he and his wife? That happened 

in February. And then in March another trip to Hawaii and then 

another trip to Napa. So the immediate action—I understand. I 

don’t agree with you on why it took so long to put Mr. Neely on 

administrative leave. I think it is absurd. I think it is a disjustice 

112 

to the taxpayer. But how did it go on for 2 more months after you 

had the report, the final report? Decisions should have been made 

easily May 3rd of last year, but February 17th of this year you said 

you received the report, you agreed with the report and then you 

took immediate action, yet Mr. Neely still went on a 17-day trip 

which he took his wife on, which they had a party and a birthday 

present. You have the emails to that. And then he went on another 

trip to Hawaii for 4 days and another trip to Napa where the entire 

executive team went and spent over $40,000 without even the travel expenses on there. 

Do you see how I have a hard time understanding how you took 

immediate action. 

Ms. JOHNSON. Congressman, upon receiving the report, I recognized that although I had tasked senior leaders with various responsibilities and oversight, clearly management controls had been 

breached. I fired the two people most immediately in the chain of 

command and I resigned. 

Mr. DENHAM. On February 17th you received a report, you had 

no problems with the report, you knew that it was factual. Did you 

meet with the White House then? 

Ms. JOHNSON. Not immediately. 

Mr. DENHAM. Have you ever met with the President over this 

topic? 

Ms. JOHNSON. No. 

Mr. DENHAM. Any other administrative—anybody else within the 

administration over the last 45 days? 

Ms. JOHNSON. We briefed people in the White House, yes. 

Mr. DENHAM. At what point? 

Ms. JOHNSON. I can dig out my calendar to help me remember. 

It was in the week of—as we were putting—it was in the week of, 

I believe, and I don’t have access to my schedule anymore so this 

is as well as I can recollect, the week of March 18th and the week 

of March 25th. They were information meetings. We needed them 

to know what we were doing. 

Mr. DENHAM. And who did you meet with? 

Ms. JOHNSON. I met with people in the White House counsel’s office, people at the Office of Management and Budget, I met with 

people in the communications staff. These are people in the meetings I held in the White House counsel’s office. I also met with people in the Chief of Staff’s office. Oh, and Presidential Personnel, 

since we were taking action on political appointees. 

Mr. DENHAM. Who within general counsel did you meet with? 

Ms. JOHNSON. I met with—hang on a sec. To the best of my 

memory we met with the general counsel, the White House counsel, Kathy Ruemmler. 

Mr. DENHAM. Anybody else within counsel? 

Ms. JOHNSON. There might have been one or two more staff there 

but I didn’t—I don’t remember and I don’t know their names. 

Mr. DENHAM. How about within budget? 

Ms. JOHNSON. We—in one of the meetings Jeff Zients came 

through, stopped in briefly. He is the head of Office of Management 

and Budget. And also met with Danny Werfel, Dana Hyde and 

Boris Bershteyn, who is at OMB. Those meetings were about policy. We wanted to talk with them about possible conference policy, 

113 

travel policy because they are clearly interested in how we can 

move forward from this kind of event and create ever better policies to try to prevent this thing, the same question—— 

Mr. DENHAM. Who did you meet within communications? 

Ms. JOHNSON. I was in a meeting in the general—in the White 

House counsel’s office. There were communications people there. 

Jennifer Palmieri I believe was there. And I think there might 

have been others, but I didn’t know their names. She might have 

been the only one. 

Mr. DENHAM. Chief of Staff’s office? 

Ms. JOHNSON. I met with—in the meetings there was representation from the Chief of Staff’s office. I believe Mark Childress is in 

the Chief of Staff’s office and Alyssa Mastromonaco. She was there 

briefly. Ultimately I met with Jack Lew as well. 

Mr. DENHAM. And in Personnel? 

Ms. JOHNSON. Nancy Hogan, the head of Presidential Personnel. 

Mr. DENHAM. Just the two of you? 

Ms. JOHNSON. No. She was in one of the other meetings. 

Mr. DENHAM. So you had meetings the week of March 18th, you 

made the decision to put Mr. Neely on administrative leave on the 

19th? 

Ms. JOHNSON. To the best of my recollection, that is the right 

date, yes. 

Mr. DENHAM. You went back to the White House or the administration March 25th. Why did it take all the way up until April 3rd 

or April 2nd to fire Mr. Peck, to fire Mr. Leeds and to put all of 

the other administrators on leave? 

Ms. JOHNSON. Well, there are—— 

Mr. DENHAM. I am trying to understand what you found out between those. 

Ms. JOHNSON. What we were doing was we were working, I was 

working particularly with our HR senior executive and a person 

from the general—senior executive in the general counsel’s office to 

understand what were the particular, what was the particular evidence that the IG had uncovered and how we could fit that into letters of admonishment and what kind of disciplinary actions they fit 

against. This required some understanding because it needed to be 

documented and we needed to create documents in order to execute 

those activities. 

Mr. DENHAM. You had all those documents. 

Ms. JOHNSON. No. We had to write letters, we had to create— 

and there are two officials involved in a dismissal so you need to 

get the person in, get them to go through the evidence and have 

them understand it and so on. It is not—it is not something you 

get done quickly. There is a process, there is a due process here 

that we needed to follow. 

Mr. DENHAM. Each of those different meetings, I assume you met 

with White House general counsel to let them know that you were 

going to be firing people and putting people on administrative 

leave, so you were seeking counsel from them. 

Ms. JOHNSON. No, I was informing them. And the meetings were 

about helping them understand what Ms. Norton is so concerned 

about, helping them understand the structure, who the people were 

in the reports, what was going on. They don’t know the internal 

114 

workings of GSA. So I needed to explain who and where and how, 

how this all sorted out. And I also needed to explain to them the 

various disciplinary options that we had and that we were working 

through them, yes. 

Mr. DENHAM. And budget, the reason to meet with them? 

Ms. JOHNSON. I met with them predominantly to talk about policy. They were eager to understand what we might suggest around 

the kinds of policies they could create so that this wouldn’t happen 

again. 

Mr. DENHAM. Communications? 

Ms. JOHNSON. She attended the meeting in the White House 

counsel’s office. Basically it was largely a meeting with the White 

House counsel and she was there in the room. 

Mr. DENHAM. Dan Pfeiffer was not in any of those meetings? 

Ms. JOHNSON. Who? 

Mr. DENHAM. Dan Pfeiffer. 

Ms. JOHNSON. Dan Pfeiffer. Not that I am aware of. 

Mr. DENHAM. Jack Lew. 

Ms. JOHNSON. I met with Jack Lew in a separate meeting, yes. 

Mr. DENHAM. Which? In the Chief of Staff’s meeting? 

Ms. JOHNSON. I met with him in his office with Nancy Hogan of 

Presidential Personnel. 

Mr. DENHAM. That was the week of March 18th? 

Ms. JOHNSON. I think that was the next week. 

Mr. DENHAM. So the purpose of all of these various meetings 

with all of these different individuals within the administration 

was to inform them what had come out of the IG’s report. Did you 

give them each a copy of the IG report? Did the IG—did you give 

them—— 

Ms. JOHNSON. I did not. I believe—I did not. 

Mr. MILLER. I had no contact with the White House about this 

report. 

Ms. JOHNSON. However—right, I did not either. 

Mr. DENHAM. Mr. Tangherlini, when did you get a copy of this 

report? 

Mr. TANGHERLINI. I got a copy of this report on Monday, April 

2nd. 

Mr. DENHAM. So the purpose of all these different meetings with 

the White House was to let them know the decisions that you were 

about to make over the next couple of weeks? 

Ms. JOHNSON. Including my resignation. 

Mr. DENHAM. When did you let them know that you were planning on resigning? 

Ms. JOHNSON. I had that meeting with Jack Lew the Friday before, so it must have been March 31st—30th, March 30th, in which 

we discussed that I was planning on resigning and I was planning 

on terminating, removing the other two political appointees. 

Mr. DENHAM. Ongoing investigation. We are still going to follow 

up with you, Mr. Tangherlini, on finding out how deep this goes. 

I appreciate the fact that you are doing an internal audit and going 

to share that with this committee. And I assume over the next couple of days or the next couple of hearings, especially with this investigation going on, when somebody does get fired I am sure that 

115 

we will hear about it. I would like to hear about it from you before 

I hear about it from the media. 

I assume that when somebody goes to jail that will come through 

the DOJ. We will probably hear that from the press before we hear 

it from you. And I think a bigger issue here is what gets paid back, 

what do the taxpayers own? I would like to know who you are 

going after and what you are asking them to pay, and when they 

actually pay the money I would like to know that, too. 

Mr. Tangherlini, we are drafting legislation to require GSA to obtain approval specifically for its administrative budget each year. 

We want to ensure that there is transparency. We should have had 

this information a long time ago. But there is no reason the taxpayers should not know where these expenditures are going forward. I know you haven’t seen that legislation yet, but at least the 

idea, the concept of this do you support? 

Mr. TANGHERLINI. I would be happy to work with the committee 

on any such language. 

Mr. DENHAM. Do you have any issue with providing greater 

transparency to this committee? 

Mr. TANGHERLINI. We have no issue with providing greater 

transparency. 

Mr. DENHAM. Do you have any issue sharing the annual budget 

with the Public Buildings Fund with this committee? 

Mr. TANGHERLINI. I can’t see why we would have any problem 

with that. 

Mr. DENHAM. Thank you. As we talked about here—well, let me 

just confirm, the Hats Off program is done? 

Mr. TANGHERLINI. Yes, it is. 

Mr. DENHAM. We talked about the L.A. Courthouse. We have 

great concern as a committee on that issue. Not only that it is moving forward but that a new prospectus wasn’t done. Are you planning on doing a new prospectus on that project? 

Mr. TANGHERLINI. Mr. Chairman, at this time I don’t know 

enough about that project to be able to do that. 

Mr. DENHAM. I would request that you take a look at that issue 

and provide this committee with your recommendation on how you 

plan on proceeding forward on that issue. 

A much smaller issue. I am also planning on putting through a 

bill on banning all coins. It sounds like Mr. Walz will be more than 

happy to cosponsor that issue with me. Any reason in the future 

why we need to be spending taxpayer dollars on coins, commemorative coins? 

Mr. TANGHERLINI. I can’t think of any reason as it pertains to 

GSA, but again I don’t know enough to know how these have been 

used. 

Mr. DENHAM. Do you—you don’t know of any reason why we 

would need to? 

Mr. TANGHERLINI. I can’t think of any reason, no. 

Mr. DENHAM. To say I am disappointed would be an understatement. I have been outraged in my district, angry. Mr. Walz knows 

that because we work on a lot of veterans issues together, and 

what we see our veterans going through is very personal. To see 

this type of abuse is, it goes beyond irresponsible. 

116 

I have had a good relationship with Mr. Peck, we really have. As 

a freshman coming in I had a lot to learn. We have communicated 

quite often on cell phone and discussed how we could get the Civilian Property Realignment Act, how we can change the way of doing 

business here. I am disappointed that a lot more of this didn’t come 

into light during those conversations. I would just say I hope that 

you and I have a better relationship so that you feel comfortable 

that we can have an off-the-record conversation if something does 

arise, whether it is in this investigation or whether future investigations need to happen. 

I am very proud of the fact that this committee most often works 

as a bipartisan committee. I mean, I think Republicans and Democrats probably agree on this committee more than most here in 

Washington. So it is really disheartening when we see things being 

hidden from the taxpayer, that there aren’t better decisions being 

made. 

So in closing, I would just say I look forward to having a better 

relationship, a more open relationship, that we can share some of 

this information and work together not only in a bipartisan level 

but on a bicameral level and making sure that we can address this 

stuff together. 

I would like to thank each of our witnesses for their testimony 

today, some of their very frank and difficult testimony. And if there 

are no further questions, I ask unanimous consent that the record 

of today’s hearing remain open until such time as our witnesses 

have provided answers to any questions that may be submitted to 

them in writing, and unanimous consent that during such time as 

the record remains open for additional comments offered. Without 

objection, so ordered. 

I would also like to thank our witnesses again for their testimony, and again if no other questions, this committee stands adjourned. 

[Whereupon, at 1:55 p.m., the subcommittee was adjourned.] 

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Æ 


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