GSA ordered to give job back to executive fired after Las Vegas conference scandal

March 13, 2013

The General Services Administration was ordered this week to reinstate a senior executive who lost his job last year amid revelations of lavish spending at a Las Vegas conference.

GSA officials had told Paul Prouty that he “knew or should have known about the questionable and excessive expenditures” that embarrassed the Obama administration when they were revealed last year. But the agency failed to prove that the career civil servant in charge of federal buildings in the Rocky Mountain region was guilty of misconduct, the Merit Systems Protection Board ruled.

The board also awarded Prouty, 64, 11 months of back pay. Administrative Judge Patricia Miller wrote in a 48-page ruling that because Prouty did not attend the four-day conference in 2010 and was not heavily involved in planning it, he should not have been fired.

“We are disappointed with the . . . ruling,” the GSA said in a statement. The agency “has taken strong action against those officials whom we believe were responsible and will continue to do so where appropriate.” Acting Administrator Dan Tangherlini, appointed by President Obama to clean up the agency, “has taken significant steps over the past year to improve internal controls and oversight,” the statement said.

Spokeswoman Betsaida Alcantara said the agency is reviewing whether to appeal the ruling.

Prouty’s attorney, William Bransford, said his client’s victory showed that the GSA overreached as the Obama administration sought to contain the scandal at a time when federal spending had come under scrutiny from both parties.

“Some of the people making decisions on discipline were responding to the fact that the conference had become a political issue,” Bransford said. “They needed as many scapegoats as they could find.”

While dozens of employees from Prouty’s staff in Region 8 attended the conference, and he “engaged in some of the planning,” Bransford said, “GSA was unable to provide any evidence of misconduct.”

He said Prouty plans to return to his job.

Prouty is one of 46 officials who were suspended, warned or reprimanded for their role in the Western Regions Conference. Eleven of them were fired. The GSA had also recommended the firing of conference organizer Jeffrey Neely, the Region 9 commissioner, but he was allowed to retire under civil service regulations.

The rest of the 300 employees who attended the event off the Las Vegas Strip were sent letters of admonishment, GSA officials said.

At least two other fired senior executives are awaiting rulings from the merit board on similar appeals.

The $823,000 conference was billed as a training event, but it quickly became an embarrassment for the Obama administration after GSA Inspector General Brian Miller revealed in a report last April on a four-day junket that had spun out of control.

Lodging at an opulent hotel, entertainment by a $3,200 mind reader, after-hours parties in 2,400-square-foot loft suites, a $7,000 sushi reception, a bicycle-building exercise — all took place at taxpayers’ expense. The planning included about six scouting trips, at a tab of $130,000.

Administrator Martha N. Johnson resigned under pressure and her top deputy, Public Building Service chief Robert Peck, was fired. Multiple congressional hearings revealed a casual spending culture at the GSA that made a mockery of the administration’s pledge to run a more efficient civil service.

Prouty was one of four regional chiefs who were fired or forced to resign. He had a 39-year career at the GSA, including a year as acting agency chief when Obama took office. He appealed his termination to the merit board last June.

In her ruling, Miller wrote that one of Prouty’s aides met with him a few times in 2010 about the conference but did not brief him on details of purchasing, contracting or procurement. Prouty told the judge he was not heavily involved in the planning and was unaware that the conference cost had ballooned. She said she believed him.

Because of a conflict, Prouty did not fly to Las Vegas. When the inspector general’s staff interviewed him during its investigation, they found little involvement in the conference details.

He was aware that attendees were given commemorative coins, but Prouty thought they were an appropriate way to recognize employees for their work carrying out the president’s stimulus plan.

Prouty attended one planning meeting for the conference in March 2010, but the judge said many details of what would become lavish expenses had not been worked out.

“The appellant’s testimony was unwavering, detailed, precise and forthright,” the judge wrote.

Correction: An earlier version of this story incorrectly stated that Jeffrey Neely was fired. Though GSA recommended he be fired, he was permitted to retire under civil service laws.

Lisa Rein covers the federal workforce and issues that concern the management of government.
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