GSA Defends Administrator in Hill Inquiry

The budget dispute drew a questioning letter on Oct. 20 from Sen. Charles E. Grassley (R-Iowa), then chairman of the Senate Finance Committee. He urged Doan to maintain the inspector general's independence. He said money used to fund contract audits had "saved the taxpayers more than $1 billion over the past two years." Grassley sent a letter yesterday to the Senate Appropriations Committee requesting that money to fund contract audits become a permanent part of the inspector general's budget.

The GSA released a statement yesterday: "The Administrator has only opposed unaccountable and undisciplined spending, not increased oversight. Any characterization of pre-decisional budget discussions that suggests otherwise is simply inaccurate."

After the Post story about the diversity study, Waxman sent Doan a letter requesting further information about possible "procurement irregularities." In its response to Waxman, the GSA said The Post's article was "characterized by inaccuracy and prejudice" and a "mischaracterization of the facts."

A lawyer hired by Doan, John J. Walsh, said in a Feb. 5 letter to The Post that Doan has been a victim of a "push back" by the inspector general's office against her attempt to "reduce wasteful spending throughout the agency, including the OIG."

The GSA called Fraser "the recognized leader" in the diversity field and said Doan reached out to Fraser about the "need for a very short and inexpensive report." Doan said in the interview that she authorized the report to promote GSA's diversity initiatives at the request of Felipe Mendoza, who runs the agency's Office of Small Business Utilization.

The GSA's response said that Doan signed a service order to authorize the work but that no contract was "ever executed."

Walsh said Doan was not "sidestepping" procurement rules but instead had submitted the no-bid order "into the contracting process."

Doan told The Post: "I handed this off, and then that was the last that I worried about it."

GSA staff, including legal counsel, determined that the arrangement did not comply with federal contracting rules.

On Aug. 4, GSA contracting officer Donna C. Hughes wrote to Fraser: "The U.S. General Services Administration (GSA) hereby notifies you that the contract, evidenced by the enclosed Confirmation of Service Order Prepared for GSA, signed and dated July 25, 2006, is terminated in its entirety."

Fraser is president and chief executive of Public Affairs Group Inc., the umbrella company of Business Women's Network and Diversity Best Practices, the division that was to have written the report. At the time of the proposal, Public Affairs Group was owned by iVillage Inc., a subsidiary of NBC Universal Inc.

The GSA response said Doan has a "close professional relationship" but "no personal contractual arrangement with Edie Fraser or Diversity Best Practices of any kind."