Smithsonian Termed 'Endangered'; Board's Structure Questioned

"We have clearly heard the concerns of Congress and the public," Sant said. "We sincerely regret the circumstances that have led to a loss of confidence in the spending practices and oversight at the Smithsonian."

A. Sprightley Ryan, the Smithsonian inspector general, painted a picture of a Board of Regents that was unaware of many pertinent details of compensation packages and was deliberately kept in the dark about the institution's problems. She testified that the regents were "not fully aware" of Small's employment agreement, especially his unusual housing allowance. "Without knowing these facts, the regents had no basis for monitoring or questioning the housing allowance payments."

The board is working to improve its management, oversight and communication, said regent Patricia Stonesifer, who chairs a new governance committee and is considering eliminating the secretary's housing allowance, which raised questions on Capitol Hill when The Post reported that Small had received $1.15 million in housing allotments for a $3 million mansion that didn't have a mortgage.

"It seems to me this is one of the areas where you got into trouble," said Bennett.

Included in the challenges facing the Smithsonian is its enormous maintenance backlog, said Mark Goldstein, a director at the GAO. Acting Secretary Cristián Samper said that more than half of the buildings are "past their normal, useful life spans."

Congress provides 70 percent of the Smithsonian's budget, with the funds going to salaries and benefits, as well as upkeep and some construction. Feinstein acknowledged that the president's proposed $44 million for repairs was not enough but criticized the Smithsonian for not raising private money for leaky roofs and cracking foundations. Feinstein told the panel she had no trouble getting corporations to chip in for cable car repairs when she was mayor of San Francisco.

Ryan said that Small "limited and polished" information about the operations of the institution. She said the regents were misled about a multimillion-dollar financial system that was substantially delayed and millions of dollars over budget until an inspector general's report. Ryan also said reports from the Office of Policy and Analysis "were edited to downplay criticism of senior leadership."

Feinstein asked if there was a conflict of interest for Small and Deputy Secretary Sheila P. Burke to hold highly paid seats on the Chubb Group board while the Smithsonian pays the company $500,000 annually for insurance. Samper said Small and Burke had "no direct involvement" in choosing the insurer and had followed procedures.

But Ryan said, "There certainly is an appearance of a conflict of interest to me and we would like to look into that."