Scandal-plagued Americorps loses inspector general funding

Matthew Boyle Investigative Reporter
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The inspector general for the Corporation for National and Community Service (CNCS) got hit with a nearly 50 percent budget cut for 2012, a move that, unless immediately remedied, will stifle the office’s ability to investigate a controversial branch of the Obama administration.

CNCS, and specifically its Americorps division, has been plagued with scandals. Americorps is a federally-funded community service program.

The previous CNCS inspector general, Gerald Walpin, was fired after investigating Sacramento, Calif. Mayor Kevin Johnson — a former NBA star and a Democrat with ties to Obama — over allegations that he misused an $850,000 grant Americorps gave his community group, St. Hope.

Johnson was accused of inappropriately touching young girls, and is alleged to have offered at least one of them $1,000 per month to stay quiet about it and stay at St. Hope.

Other allegations Johnson faced, according to a 2009 congressional report prepared by now House Oversight Committee Chairman Rep. Darrell Issa and Sen. Chuck Grassley, include Americorps volunteers running errands for Johnson, washing his car and conducting political activities all while on the clock — meaning taxpayers paid the bill.

Walpin also found about $80 million of wasted taxpayer funding through Americorps to the City University of New York, the Washington Times reported. That funding was apparently for a teaching fellowship.

Issa’s and Grassley’s report found that White House officials had moved to fire Walpin without conducting a fair investigation. According to Issa and Grassley, administration officials argued that Walpin was “no longer fit for his job” based on a complaint CNCS Chairman Alan Solomont — a prominent Demcoratic fundraiser — delivered in person to Obama administration lawyer Norm Eisen in the White House parking lot.

The White House had said that it conducted a “thorough” investigation of Walpin’s ability to continue serving as CNCS’s inspector general, but Issa and Grassley found that the White House only interviewed two of CNCS’s nine board members and that the White House took “substantive input from only three people: Chairman Solomont, a prominent Democrat fundraiser; acting CEO [Nicola] Goren and General Counsel [Frank] Trinity.”

Trinity and Goren were subjects of Walpin’s investigation as well. Issa and Grassley cast doubt on the White House’s ability to conduct a fair investigation when the only people they took seriously during their decision to fire Walpin were his “adversaries.”

After the Obama administration fired him, Walpin was supposed to be replaced by Jonathan Andrew Hatfield, a then-deputy inspector general at the Federal Election Commission. But, in April, during a news dump in the middle of the first 2011 budget battle between Republicans and President Barack Obama, the White House rescinded Hatfield’s nomination. That has left the CNCS without an inspector general for even longer than it was supposed to not have one.

Then, during budget discussions on Capitol Hill later in 2011, 48 percent of the CNCS inspector general office budget was cut for fiscal year 2012.

Now, the appropriations bill is law, and CNCS inspector general leadership has informed Republican Sens. Mike Enzi, Susan Collins and Chuck Grassley that the cut will lead to downsizing of 75 percent of the office’s staff in the next several days, unless the problem is fixed by mid-January.

“With this reduction in funding, my ability to conduct oversight activities of the Corporation will be severely limited for the remainder of [fiscal year] 2012,” the agency’s current deputy inspector general, Kenneth Bach, wrote in a letter to Congress that was obtained exclusively by The Daily Caller. “And, for the first time in my experience, I believe that my independence may now be perceived as diminished due to my need to rely on the Corporation’s assistance in funding certain administrative needs and financial obligations that I can no longer fulfill.”

“Under these circumstances, I have no choice but to initiate procedures for Reduction in Force (RIF) of my staff under federal personnel rules beginning mid-January,” Bach wrote. “I expect to reduce my staff by at least 75 percent to conform to remaining FY 2012 obligations and requirements and avoid a violation of the Anti-Deficiency Act. This RIF will include investigators, auditors and mission support staff.”

Those staffers are people who are supposed to investigate and audit the Obama administration’s actions with CNCS. Without those staffers, that arm of the administration could commit questionable and corrupt activities without any check from the inspector general office.

The inspector general office cut totals approximately $4 million, while CNCS as a whole received a budget cut of just about 3 percent. CNCS is still appropriated about $752 million for operating expenses and $83 million for salaries of its workers and other expenses. Enzi, Collins and Grassley have asked Iowa Democratic Sen. Tom Harkin — the Senate appropriator responsible for CNCS funding — to allow for funds to be transferred from the CNCS main budget to its inspector general office quickly to prevent harming the watchdog arm of the agency.

“We believe that $4 million could be transferred to the Office of the Inspector General without harming the Corporation’s overall mission,” the three GOP senators wrote to Harking in an urgent request letter on Wednesday.

It’s unclear if Harkin will take up the initiative and push for the funding to be re-appropriated from CNCS’s main budget. His spokesperson didn’t immediately return a request for comment.

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