GSA scandal puts Las Vegas in bind as hearings begin

WASHINGTON -- Revelations about a 2010 federal conference in the Las Vegas area that cost taxpayers $823,000 and featured a mind reader and government workers joking about parties and deserving raises captured headlines over the past two weeks.

As the story widened, the General Services Administration's gathering at the M Resort in Henderson seemed to be eclipsed by reports of other abuses, such as a similar gathering for interns in Palm Springs, Calif., and possible thefts and credit card fraud within an employee recognition program.

Now, with Congress returning from a two-week recess, Nevada officials are hoping a series of Capitol Hill inquiries this week will have enough to talk about without focusing undue -- and they say unfair -- attention on Las Vegas.

"The focus of any hearing should be on the fiscal responsibility within the General Services Administration and by no means on Las Vegas," Mayor Carolyn Goodman said. "To do otherwise uses Las Vegas as a scapegoat and distracts from the real issue at hand."

Three congressional panels have scheduled hearings this week -- starting today -- on the "over the top" Western Regions Conference that was the focus of a blockbuster April 2 report by GSA Inspector General Brian Miller.

Miller has been invited to testify at all three hearings.

Miller's yearlong investigation of the biennial Western Regions Conference prompted Martha Johnson to resign as administrator after dismissing her top two assistants.

A handful of other GSA officials were put on administrative leave.

Daniel Tangherlini, who took over as GSA administrator, has launched a review and already canceled several previously scheduled conferences, including a one-day trade show at the Hampton Inn Tropicana this month and a two-day session in September that would have marked a GSA return to the M Resort.

House Oversight Committee Chairman Darrell Issa, R-Calif., is holding a hearing this afternoon. House Transportation Committee Chairman John Mica, R-Fla., is holding a hearing on Tuesday. Senate Environment & Public Works Chairman Barbara Boxer, D-Calif, has a hearing scheduled Wednesday.

Issa and Mica also have had their staffs scour related documents requested from GSA officials and the inspector general to uncover further abuses. And, on a near daily basis, they have expressed dismay at further findings associated with the extravagant conference in Henderson.

Goodman is urging lawmakers to "leave Las Vegas out of the dialogue" as they conduct their investigations. At stake, she said, are 370,000 jobs associated with Southern Nevada's hospitality industry.

Sens. Harry Reid, D-Nev., and Dean Heller, R-Nev., echo that view.

Reid has cautioned Boxer about the tone of her hearing, according to aides. Heller sent a letter to Mica urging him to focus on the "misjudgments of the GSA without unfairly targeting" Nevada's accommodations and convention services.

Both senators plan to submit testimony or letters to Boxer's committee that will likely stress the same point. They also plan to monitor the hearings closely.

"I hope the hearings focus on the irresponsible actions of these employees rather than unfairly targeting Las Vegas. Las Vegas is the best place in the world to hold a convention, and it should not be used as a scapegoat by House Republicans since this convention could have been held anywhere in the country," Reid said.

Heller said: "Taxpayers' dollars should be spent responsibly, and those responsible for any misuse should be held accountable. However, it should be noted that it was not the location that caused the misuse of taxpayer funds. The convention services our state offers are the best in the world and no town or city in Nevada should be singled out due to poor judgment by the GSA."

Boxer has invited only two witnesses to appear at her hearing: Miller to discuss his report and Tangherlini with the Obama administration's response.

The two House committees have invited Miller and Tangherlini. But, they have also invited current and former GSA officials responsible for the 2010 Western Regions Conference.

Jeffrey Neely, the senior government executive at the center of the spending scandal has been subpoenaed but is expected to invoke his Fifth Amendment right not to incriminate himself before the House Oversight Committee, according to The Washington Post.

Neely, who organized the conference in Henderson, told investigators that he believed it was OK not to get bids from competitors because he was paying for quality.

He also didn't get legal advice in writing on a contract for the conference that has become Washington's latest symbol of waste because it would slow down business and be "discoverable" in lawsuits, according to transcripts of interviews conducted by the agency's inspector general and reviewed by the Post.

Neely also told investigators that a private party he threw in his Las Vegas hotel suite for $2,717 was an employee-awards event.

Ali Ahmad, a spokesman for the House Oversight Committee, said the focus of its hearing is on the "culture of wasteful spending" at GSA and not on a specific location. "It's quite clear that administration officials and bureaucrats are at fault and not Las Vegas itself," Ahmad said.

Richard Hanley, director of the graduate program in journalism at Quinnipiac University in Connecticut, said it is no surprise why Congress would clamor so publicly over an example of government waste.

Hanley said it is "pure theater" aimed at grabbing further headlines.

"A Las Vegas government junket is perfect fodder for those who want to limit government spending," he said.

But the hearings may be coming too late for politicians looking to score election year points.

"The GSA scandal has already washed through the news cycle. The hearings may give it some more traction, but the real punch of this story has already been exhausted," Hanley said.

Washington Post reporters Lisa Rein and Timothy R. Smith contributed to this report. Contact Stephens Washington Bureau reporter Peter Urban at purban@stephensmedia.com or at 202-783-1760.