The White House Property Review Board has asked the General Services Administration to consider using a particular real estate broker to help sell a valuable piece of Philadelphia property -- a move that has worried ethics-conscious officials at the once-beleaguered and scandal-torn GSA.
GSA is looking to increase the use of real estate agents to help market federal properties, but federal regulations require that competitive bidding prevail to avoid favoritism. Theoretically, everyone is supposed to have an equal chance to bid or help sell a government property under federal law and regulations.
Joshua A. Muss, executive director of the White House-level Property Review Board, wrote a one-paragraph note to GSA Administrator Gerald P. Carmen Feb. 22 suggesting that an old friend, Joseph Straus, Jr., of Strouse Greenberg and Co., may be helpful in selling the old Frankford Arsenal in Philadelphia.
Muss, who said in his note that he knew Straus "for many years," wrote that, "In my opinion, Strouse Greenberg would be one of the firms qualified to assist you."
Although Carmen apparently never saw the Feb. 22 letter, his staff asked for an opinion from ethics counsel Saul Katz. The verdict, according to Katz, is that there was "nothing legally wrong with it, but it wasn't very prudent."
"That is the way something is done in the private sector, but it is not the way something is done in government," Katz said. "I would suggest that if he had to do it again, he would simply pass on the gentleman's request to be considered without comment."
The assistant commissioner for real property, Earl E. Jones, said he did not consider Muss' note "a justifiable request."
"Our response . . . was nothing more than a stock reply," Jones said.
Deputy GSA Administrator Ray Kline said in a March 11 letter to Straus that GSA was trying to sell the property to the City of Philadelphia but, if the deal fell through, "We would undertake alternate methods of disposal. In this regard, your interest in performing marketing services for GSA has been noted and made part of the record."
Muss said the flap was a lot of nothing: "We routinely get letters from brokers and we routinely send them over" to GSA, he said.
But Jones said this was the first time the board had sent a letter indicating that a specific broker be considered.