Government probes Katrina
aid charges
WASHINGTON — Federal employees helping Katrina victims charged
more than $39 million on government credit cards for disaster relief
items. Congressional investigators want to make sure the taxpayers
got a good deal.
And a senator, citing past abuse, wants to know whether anyone used
the cards for holiday shopping.
Many of the goods, which included $60,639 for sleeping bags and
$713 for four 27-inch televisions, were bought at retail rather
than cheaper volume prices following the Aug. 29 storm, according
to federal records.
The spending also included $150,000 worth of Jockey underwear, six
nail clippers and $3,200 for golf carts.
The Federal Emergency Management Agency says it needed some items
quickly — such as the underwear— for evacuees in temporary
shelters. Jockey International says the underwear sold at or below
the company’s cost.
Federal officials responding to Katrina “were not going to
spend days calling all across the country and haggling prices —
the initial purchases were about saving lives,” said Homeland
Security Department spokesman Larry Orluskie.
The lists of purchases provided by five government agencies show
nothing outrageous — bottles of water, hundreds of maps of
New Orleans and Texas, pizza dinners and lots of insect repellent.
The Homeland Security Department also bought 50 automatic heart
defibrillators for nearly $1.5 million for use at shelters.
The credit card bills, which are directly payable by Uncle Sam,
were vulnerable for abuse in the Katrina aftermath after agencies
were given the power to raise the credit limit from $15,000 to $250,000.
That authority was repealed on Oct. 3.
There is a history of credit card abuse by government employees,
including charges for $400 Coach briefcases, a dog and Victoria’s
Secret clothing.
Sen. Charles Grassley, chairman of the Finance Committee who successfully
pushed for the credit limits to be lowered back to $15,000, said
his office was going to make sure “hardworking Americans don’t
pay for government employees’ Christmas shopping.”
“When I began looking into this issue several years ago, we
uncovered hundreds of millions of dollars of taxpayer money that
was lost due to inadequate controls,” said Grassley, R-Iowa.
“When you’ve seen this kind of abuse, it’s hard
to justify increasing the limit on these cards.”
This time, the congressional audits — the first of which is
due out early next year — will not only focus on any abuse,
but on missed opportunities to get discounted rates for commonly
purchased items such as office supplies and clothing, according
to the Government Accountability Office, the investigative arm of
Congress.
Based on prior audits, at least 10 percent of the Katrina charges
— or about $4 million — might have been saved if the
government used its leveraging power to pay lower-than-retail cost,
said Greg Kutz, managing director of special investigations at GAO.
“It’s one way to look at it,” Kutz said, addressing
the rough estimate of 10 percent spending waste while at the same
time stressing the GAO’s review was far from complete. “There
are always some bad apples out there, trying to do things for personal
gain.”
Only a thorough review will tell whether spending went notably awry.
For example, was $11,078 worth of ice bought by the U.S. Forest
Service at retail stores really necessary, since the government
already had a $107.9 million pre-existing ice contract with IAP
Worldwide Services? Some senators have charged that poor planning
led to waste in the IAP contract, which is also being audited.
Danielle Brian, executive director of the watchdog group Project
on Government Oversight, expressed concern with many instances of
retail purchases, which included $66,632 worth of supplies from
Wal-Mart for items such as scissors, white bath towels and nail
clippers.
“Only time will tell where the money has been squandered which
should have gone to help Katrina victims,” Brian said.
In many instances, the government records showed anomalies. The
Transportation Department, for example, initially reported a purchase
of a $5,374 paper shredder; it later said the shredder, which was
apparently designed to meet security standards, was improperly designated
as a Katrina expense.
The U.S. Army Corps of Engineers lists repeated duplicate charges
— for example, the exact same charge of $1,461.42 each for
“1 IP90 portable printer,””1 Laserjet 2430TN printer,””1
wireless access point” and other miscellaneous items that
spokesman Scott Saunders later acknowledged were probably errors.
Auditors including Homeland Security inspector general Richard Skinner
have already cited the Red Cross and FEMA for similar data-reading
errors that they said reflected inadequate accounting procedures.
Robert Johnson, a spokesman for the Department of Transportation,
said most federal employees are seeking to do the right thing. His
agency’s expenses, totaling more than $400,000, included $5,728
for boots and T-shirts with DOT logos, many of them worn by the
auditors themselves in the Gulf Coast region.
“We think that people generally are doing what they think
is right to deal with the circumstances they’re facing at
the moment,” he said. “But we are committed to making
sure every dollar spent was spent for the right reason.”
(Associated Press)
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