The House Oversight and Government Reform Committee today kicked off the first of many hearings about spending practices at the General Services Administration, focusing on why a key official involved with planning a lavish Las Vegas conference was awarded a $9,000 bonus after the agency’s former administrator had been briefed about the practices.

“Thank God that this time, what happened in Vegas didn’t stay in Vegas,” Rep. Mike Kelly (R-Pa.) said.

Jeff Neely, the GSA official who helped organize the conference and was awarded the bonus, invoked his Fifth Amendment rights, declining to answer repeated questions from Oversight and Government Reform Chairman Darrell Issa (R-Calif.).  

Testimony at the hearing by GSA Inspector General Brian Miller revealed new allegations that Neely intimidated employees who tried to blow the whistle about the extravagant expenses.

GSA employees told Miller that those who spoke up about the abuses were, in their words, “squashed like a bug” by Neely or “put down, and not in a gentle way.”

Martha Johnson, who served as administrator until resigning April 2, when Miller’s report became public, said that morale and leadership at the agency had deteriorated between when she served there during the Clinton administration and when she went back early in the Obama administration.

“The agency was not the same. A quarter of the executive positions were empty, [and] strategy was nonexistent,” Johnson said.

“What I did not know until much later was that there was yet another problem. The Western Regions Conference, which had been an economical, straightforward set of training sessions in the late 1990s, had evolved into a raucous, extravagant, arrogant, self-congratulatory event that ultimately belittled federal workers and would stain the very work that other committed staff and I were preparing to do.”

Miller said he briefed Johnson on details about the almost $800,000 conference in May 2011. A PowerPoint presentation used for briefing top officials at a May 3
meeting includes details about Neely’s visits to Las Vegas numerous times ahead of the conference for “planning” purposes and that he “advocated” a $75,000 training exercise where teams of GSA employees constructed 25 bicycles.

In November 2011, Johnson personally approved a bonus for Neely.

Asked about why she would award Neely a bonus after she had been briefed about the conference, Johnson said the bonus was for the performance of the regional office Neely was overseeing as acting administrator, not for the ongoing investigation into his “conduct.”

“I asked for the investigation, and I wanted to hear the full context,” Johnson said, adding that she didn’t expect for Miller’s investigation to take so long to be finalized.

Rep. Jason Chaffetz (R-Utah) called Johnson’s explanation “outrageous.”

Under questioning by Rep. Joe Walsh (R-Ill.), Johnson apologized broadly for the Las Vegas conference but resisted saying she regretted awarding the bonus to Neely.

Chaffetz pressed Michael Robertson, the chief of staff at the GSA and an aide to President Barack Obama when he was a Senator, as to why Neely had not been fired.

Robertson said disciplinary actions had been initiated for several employees.

A statement from Dan Tangherlini, the acting director of GSA, indicated that additional employees had been disciplined, bringing to 13 the number of officials who resigned, were fired or have been placed on leave over the conference. Tangherlini, who came over this month from his position as the Treasury Department’s chief financial officer, also noted that “we have cancelled the 2012 Western Regions Conference as well as a number of other conferences that only or primarily involved staff. To date, I have cancelled 35 conferences, saving taxpayers $995,686.”

Rep. Michael Turner (R-Ohio) asked officials about gifts provided to attendees of the conference, including a blackjack dealer’s vest with a monogrammed conference logo, a participant yearbook, a coffee table book about Las Vegas personally signed by Neely and other assorted items.

Turner held up the vest, which cost taxpayers $100 each for a total of nearly $2,000, and noted that many of the items were made in China.

Many of the items have been displayed. Issa showed them on CNN earlier today in a segment that was taped during the weekend.

The hearing was the first of four this week. House Transportation and Infrastructure Chairman John Mica (R-Fla.) hosts a hearing Tuesday, and Senate Democrats will convene a hearing later this week.

The GSA Office of Inspector General initially revealed in an April 2 report that the agency spent about $823,000 on the October 2010 Las Vegas conference for about 300 people, along with a series of colorful expenses that drove up the cost.

After the revelation, Johnson resigned, two of her top aides were fired and four other managers were placed on leave.

According to documents obtained by Roll Call, GSA officials invented awards as an excuse to hold taxpayer-funded dinner events at conferences.

At one such event, the agency bestowed a “jackass award” on an employee, a GSA employee told the OIG, according to an interview transcript.

In the transcript, a GSA employee who attended the Las Vegas conference said officials routinely created awards to justify taxpayer reimbursement for dinner events.

Describing the award ceremonies as a “running joke,” the employee said supervisors explained that the awards were designed to justify dinner events at the conferences.