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  •   Agriculture Secretary Espy Resigns

    By Ann Devroy and Susan Schmidt
    Washington Post Staff Writers
    Tuesday, October 4, 1994; Page A01

    Agriculture Secretary Mike Espy, under investigation for improper acceptance of gifts, resigned yesterday under pressure from the White House. He cited his need to "overcome the challenge to my good name."

    Administration officials said the precipitating factor in the resignation, after months of questions over Espy's use of government perks and acceptance of small gifts, was the White House discovery last week that a foundation run by Tyson Foods Inc., the giant Arkansas agribusiness, had given a $1,200 scholarship to Espy's girlfriend, Patricia Dempsey.

    A senior official said Espy and his lawyer informed the White House at midweek of the scholarship as a potential problem but denied that Espy had been aware of it when the money was awarded late last year. On Friday, officials said, Espy and his lawyer "clarified" the issue by informing the White House that Espy and Dempsey had discussed the scholarship before it was awarded, that he had suggested she not accept it but that she went ahead anyway.

    Espy's lawyer Reid Weingarten bristled at the suggestion that his client had been less than straightforward. "Mike Espy has never misrepresented anything to the White House," Weingarten said last night.

    A senior official said the scholarship, which covered classes for Dempsey at the University of Maryland, raises the issue of a company regulated by the Agriculture Department attempting to "curry favor" with Espy. Dempsey, who works for a Washington consulting firm, has since returned the money to Tyson at Espy's urging, officials said.

    Clinton, in a written statement, praised Espy's tenure but said he was "troubled by the appearance of some ... incidents" under investigation. He called the resignation, which is effective Dec. 31, "appropriate" and said Espy would recuse himself from meat and poultry inspection issues.

    In a news conference at the Agriculture Department, Espy portrayed his resignation as his decision, saying he needed time to defend himself in both the White House and government office of ethics investigations and in a separate inquiry being conducted by a special counsel. A delay in his departure, he said, would allow for an "orderly transition."

    But White House officials who had been conducting a review of Espy's personal and office records said they showed a "pattern of problems" associated with "an insensitivity to the appearance of propriety." The conclusion that he should resign was "mutually agreed on" by Espy and White House Chief of Staff Leon E. Panetta, the officials said.

    Over the past few months, Espy has reimbursed the department and outside companies more than $7,500 for questionable expenses and gifts. The largest repayment, $6,200, was to cover the cost a leased Jeep Cherokee that Espy had the department maintain at the Jackson, Miss., airport. He sometimes used it for personal transportation on his frequent trips home.

    A senior official said that Espy and his lawyer met Friday with Panetta and White House counsel Abner J. Mikva to hear of "the very serious concerns" over the issues. Espy was told by Panetta -- with Clinton's approval -- "to think about these matters over the weekend." Sources said Panetta told Espy, in effect, that he could not survive revelation of the scholarship and questions over the use of the Jeep and should seriously considered resigning quickly.

    On Sunday, in a classic sign of Washington message-sending, Panetta declined to offer a public vote of confidence in Espy when asked about him on CBS's "Face the Nation." Yesterday, Espy and his lawyer came to the White House for a meeting with Panetta and Mikva and agreed, under some prompting that officials said continued for an hour, to resign but asked to hold his job until Dec. 31.

    Officials said the search for a new secretary would begin in earnest after the November midterm elections and if a successor is found, Espy may leave sooner than the end of the year.

    Espy, whose performance was held in high regard by the White House until the allegations surfaced, becomes the second member of the Clinton Cabinet to resign under fire. Defense Secretary Les Aspin was forced out of his post last December.

    At a news conference, Espy admitted sloppiness but not venality. The former Mississippi congressman said he had been "careless with some of the details" of his personal business but had violated no laws or ethics rules. He portrayed his resignation as a chance to give Clinton a "full-time" agriculture secretary and himself time to fight the allegations, most of them charges of accepting small gifts such as football tickets or lodging,

    Conceding only that he had been "careless" in managing some details of his personal life, Espy said he was resigning to devote himself to answering "untrue and unfounded" charges that have been made against him.

    "Frankly, I've been fighting these charges since February of this year, and it's seemed as if, you know, I was just twisting in the wind. And as these allegations continued the twisting continued, and the bow finally broke in my mind. I need more time to defend myself from these charges," he said.

    Espy added: "I have failed myself, and for that I apologize to the president and to the loyal people who have served so well."

    Espy's downfall was the steady dribble of revelations about questionable trips billed to the government and his acceptance of gifts from farming interests. Questions also were raised about whether he gave clients of the consulting firm that employs Dempsey preferential treatment or greater access within the department.

    In addition to the White House review of his conduct, independent counsel Donald C. Smalz is investigating whether Espy broke the law by accepting gratuities from companies regulated by his department.

    Travel records released under the Freedom of Information Act last month show that nearly one-quarter of Espy's 89 domestic trips as secretary have been to Mississippi, where his children live.

    The inspector general also investigating the actions of Ronald Blackley, a congressional aide to Espy who served as his chief of staff until February, when he was demoted. Blackley, a part-time employee in Espy's Mississippi district office, also worked as a consultant and helped some farmers obtain higher USDA subsidies.

    Espy, who lobbied hard for a place in the Clinton Cabinet, was the first black agriculture secretary and the first from the Deep South. Officials suggested yesterday that while several names have been mentioned recently as replacements if Espy left, the president would not be prepared to make a choice until the results of the midterm elections reveal whether some elected members of Congress, as one aide put it, "become available."

    Democrats appear likely to follow the historic pattern and lose seats in both the House and Senate and defeated incumbents often seek employment in the executive branch.

    © Copyright 1994 The Washington Post Company

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