through on your public trust. this committee will support you and encourage to you clean house at the gsa. and before i yield to my friend and colleague, let me put into the record an addendum that the inspector general brian miller gave us both sides of the aisle today, but he didn't have the time to get it into his testimony. it goes through the various steps that he believes should be taken at the gsa. the first one is centralizing the program and budget management. the second is centralizing agency information management. the third is what he calls getting back to basics. gsa feeds to refocus on its core mission, procurement and building operations. he said he found that many agency contracting personnel didn't understand fiscal law or the federal travel regulations or were unaware of the existence of agency policies that directly govern their daily work. this is unacceptable, he writes, and i would agree.

then he said get out of the matrix as the former gsa administrator testified, gsa employee supervision is not presently linear. it is a matrix because many high level personnel report to two supervisors. each supervisor can deflect supervisory responsibility on to the other, or claim to. and he says the matrix is really a sieve. and then he talks about requiring procurement accountability. and he goes into the fact that the agency needs to make sure that everything that is done has accountability attached to it. and i would just want to thank the ig for this. it just shows what i think is so important about this hearing when senator inhofe asked me to hold it, what i was concerned about that we would only do a look back. we need to do a look back and have justice served but we need to look forward.

so i'm very happy we have this opportunity to have you here so that we can talk about, a, how we hold people accountable and get to the bottom of the mess over there, but b, how we move forward to make sure that we don't have a repeat of this nightmare that has now occurred over so many decades and so many administrations. and i want to thank the two of you very much for being here today. and is susan here, susan brita? could you stand? i just wanted to say, i'm personally going to ask you to stand. i want to thank you so much that you had the courage to step out in what was a very difficult situation. thank you. senator inhofe? >> well, thank you, madame chairman. you had mentioned a comment made by senator reid and let me just elaborate a little bit more on that. i was surprised when i say the fact that it was held in las vegas would have something to do with it. we're dealing with corrupt

people here, madame chairman and what happened in las vegas would just as likely happen if it had been held in chicago or new york or anyplace else. >> right. >> so i think it's totally unfair for people to somehow draw a line there. i do thank you for holding the hearing. i've had a long history with this committee. before i came to the senate in '94, i spent eight years on the committee over in the house, and it happened that we were a minority but i was the ranking member on the gsa subcommittee and when you look at the overwhelming stuff they deal with, it is, if there's anyone who has a propensity to do something dishonest, that's where they ought to be. they deal with huge numbers and i've always been concerned about that, and they have a long history of this happen aing. but the -- i think this serious waste and abuse of the taxpayers' money as well as possible fraud and i understand the office of the inspector general and i applaud the work that brian miller has done on this. it hasn't been easy. i know it's taken an awful lot

of time. and after the release of the ig report on april 3rd, i sent a letter to the chairman boxer requesting the committee hold a hearing, look at the ig's findings. i also requested that both ig brian miller testify along with the acting administrator. so the i want to thank you madame chairman for doing that. in a way, this is not going to be if there is any media here looking for what they saw yesterday. it ain't going to happen here. we got the two the good guys here. >> right. >> we're not going to be accusing anybody. we're just wanting to find out where we can go from here. i think it was articulated well by the chairman. of course, mr. tangherlini, you're kind of in a position where you're going to have to do some pretty uncomfortable things, but i know a little bit about you and i think they've got the right guy doing them. the report describes a number of disturbing findings from the investigation, some of the highlights were the gsa spending

on the conference planning was excessive, wasteful, and in some cases impermissible. travel expenses for the conference totalling over $100,000 just not believable. catering costs $30,000. the gsa failed to follow contracting regulations of the procurement associated with the wrc. and wasted taxpayers' dollars. the gsa encouraged excessive and expenses for food, $146,000 on catered food. $5,600 on semi private catered in-room parties. it goes on and on. i think that i do want to have the whole statement. this has already been aired throughout the media. it's kind of interesting this morning, madame chairman, i was on the 7:00 cnn. it was supposed to be on this subject. and we went through about a 12-minute interview. they never even mentioned this. so i think people are getting a little tired of it already.

nonetheless, it's real, it's a problem. we're going to have to deal with it. since the release of the report, the gsa administrator martha jackson has resigned and head of the public building service and the administrator's top adviser were fired. further, there are ten career employees have been placed on administrative leave. these dismissals highlight the seriousness of the findings of the ig report. i want to thank our counterparts in the house for their own responsible oversight and again, thank the chair for getting our own oversight. and by the way, on the oversight, a lot of people -- somebody was asking this morning on a thing that some radio show or something, why are you doing this? it's our constitutional duty. we have oversight responsibility and there's a reason that both the house and the senate do because the house and the senate are often coming from different poles, and it's something that we have to do. there's just not a choice. i say beginning because i believe that this goes beyond our one-time event. i'm concerned that this type of

waste has become an embedded part of the culture of the gsa. the conference occurred during a recession and after the president's executive order for an, quote, efficient, effective and accountable government, and calls for the elimination of waste. one can only wonder what kind of wasteful spending would have occurred in a better economy. as a committee with oversight responsibilities over the gsa, i a and the public building service today, i hope we can find out how this happened and examine the safeguards the gsa has put in place to prevent this from happening again. it would be prudent to continue oversight hearings in the future to ensure this culture of wasteful spending has come to an end. we have an opportunity to restore the public's trust. and i think -- this goes beyond this. i can remember when we were a majority. the republicans were a majority and i happened to be the carom the chairman of the subcommittee on nuclear. they had not had an oversight hearing in 12 years. and they actually welcomed it.

i don't think that any bureaucracy should go without oversight hearings. i'm going to recommend that we expand the number. i have not made a request for them, but i think this will perhaps put us in a position where we will do that.d lo forw hearing from our excellent witnesses. >> thank you very much. senator cardin followed by senator johanns. senator baucus. each will have seven minutes. >> thank you very much for holding this hearing. i thank the ranking member. this is very important. we all were shocked by the inspector general's report revealing the shocking and shameful extravagant spending that the gsa western regional service division engaged in in 2010. i think it's important to understand that this event is indicative of a culture of this agency that goes back many years. the inspector general miller and the deputy administrator that brought this problem to his

attention should be commended for investigating this event, bringing this problem into the public eye, and calling for reforms within the agency. what's most important now is that congress work with the agency to advance smart and thoughtful reforms. the fact is, gsa is vitally important to the function of the federal government. gsa makes sure that federal government pays its rent on time, keeps the lights on in public buildings, manages federal priorities, makes sure federal workers like the scientists as the fda and social workers at va working hard for the public good have the tools and resources they need to get the job done. that said, i often do not agree with gsa's approach to its business. in april of last year, i held a gsa oversight hearing, the first gsa oversight hearing this committee had had in years to examine gsa's management service of federal courthouses. i've been in meetings with gsa public officials to discuss

prospectus locations for federal facilities where gsa unabashedly refers to the agency in which they are seeking space for as the client, and they view themselves as the broker. much the way a private real estate firm hired to find office space for a private sector company would. this private sector perception pervades this public sector agency, and i think it may have had its roots in gsa's problems. many colleagues often call for the government to run more like a business. gsa takes pride in the incorporation of private sector sensibilities and practices into its work. and there are some cues government can take from the private sector in its operations. and management that are valuable. i would argue that gsa is part because of its function as a real estate and fleet manager and contracting agent is so similar to businesses in the private sector has led to the total blurring of the line between what actions are

appropriate for a public sector agency to engage in. reforms that return productivity and accountability to gsa are in order. gsa's clients are the american people, not the social security administration or the fda or the national science foundation. and the american people are not shareholders, they're taxpayers. the extent of the wastefulness of taxpayers' dollars on the western regional conference is shocking. perhaps it's reflective of an agency tied so closely to the real estate and property management industry having hired many business professionals along with their business practices from the private sector that the agency thinks it's perfectly acceptable to hold a convention similar to those in the private sector. susie kim, an economist policy reporter for "the washington post" published an interesting commentary piece for the post on

april 14th, and mr. chairman, i'll submit the entire article for the record, but let me just quote one sentence from her article. "the real aim of contracting services is ultimately neither to make money nor to spend it. but to achieve a greater good." i hope this hearing will advance that greater good for our nation and for our taxpayers. >> thank you, senator. senator johanns. >> madame chair, thank you very much. let me thank the ranking member and the chair for holding this hearing and i appreciate the attendance of the witnesses today. i'm going to be very, very brief. i'm looking at the clock and i have an ag members meeting in about a half hour so i'm hoping to be here long enough to hear your testimony and if i have questions following that, i'll probably submit those questions

in written form for the record, but let me offer just a couple of thoughts. first of all, to the people are -- who have been involved if bringing this to light, we thank you for that. i have to imagine if this happened at this conference, there's other issues out there. i can't imagine that this was just an isolated incident. my experience with federal employees is the vast, vast majority of federal employees are there working hard. they want to do the right thing. they want to follow the rules. they don't want to get themselves into the kind of problems we see today. that's the vast majority of federal employees. but unfortunately, circumstances like this really cast things in a very, very poor light. and i might add appropriately so the. these expenses and what you see here in the record is really amazing. i mean really astounding.

my interest is going to be today and going forward the question of, what are you putting in place to change the structure and the culture of how gsa operates. often times, gsa is the piece of the federal government that interfaces with the public. they're out there working to negotiate contracts and that sort of thing doing the work that they're empowered to do. so it's just critically important that whatever happens from here forward, we have something put in place that puts this agency on the right path. gives them the right direction, sets the right course, changes the culture so some senate member is not back here five or ten or 15 or 20 years going through the same things again. so i'm so anxious today to hear from the witnesses. i have not had time to study the

addendum, but i appreciate the fact that you're putting out ideas on how we can deal with this in the future. and my hope is that following this hearing, there might even be an opportunity to do some individual visits with senators to say this is what we're thinking about, this is the direction we think this agency needs to go forward. with that, again, madame chair, thanks for having the hearing. >> thank you so much, senator. senator baucus followed by senator barrasso. >> thank you, madame chair woman. thomas jefferson once said when a man assumes a public trust, he should consider himself public property. what galls me about this is this waste, this extravagance in contrast with a lot of people i

met at a home in my state during this last recess who are struggling to make ends meet. for example, in eastern montana, there's something called a bakken formation. it's heavily impacted by oil and gas development. the police force is stretched so thin they can't begin to deal with all the issues. and police officers start at $40,000. their salary is $40,000 a year and they see $800,000 spent, what's going on here. there's a little town of culbertson i visited. they're scratching to try to get money for a sewage system, trying to piece it together here and there. when they see this waste, they go what? we could use that $800,000 for a sewage system in our little town. otherwise, we can't afford it, we can't finance it. after that, the little town of ingmar, montana. it's very small. population about two hands. trying to save their post office. the rent is $700 per month for

that post office and they see $130,000 for eight preconference trips to las vegas. you know, it's just galling. it's absolutely galling when you see what the dollars could otherwise be spent for just for legitimate purposes. where people are really struggling. and i just tell you that i think senator cardin touched on it, senator johannes, i agree with him. there is something rotten in denmark. something's not quite right here. it's not just this. there's got to be a lot more. and i very much credit you, mr. tangherlini for taking over here. i have a lot of trust in you. i think you're the kind of guy who is going to straighten all this out, but it's going to take a lot of work, a lot of work. it can't be something we can just deal with not only not -- just got to do the it moderately, can't do that, you've got to go to the core and get the culture problem rooted out at gsa.

and i just thank you so much, madam chair, for this hearing. i urge and demand of you almost as a person working for one million people that this is what they want. this is what my employers want. you know, i work for all those folks. you work for all those folks i talked about. everybody at gsa does. that's the public trust that we have to honor. >> thank you very much, senator. and now we're going to turn to senator barrasso. >> thank you very much, madame chairman thank you also senator inhofe for holding this hearing. i want to thank the inspector general and special agents involved in the investigation. i agree with what senator baucus has said and heard from senator johanns. this investigation, it has exposed the waste, fraud and abuse at that time american people really resent so much. this hearing isn't about where this wasteful conference took place. it's really about arrogance and

abuse of power. you look at the mission of the gsa's public building service to provide superior value it says, superior value to the american taxpayer. the gsa western region conference was a blatant disregard for the hard working taxpayer of this country. there was a systemic failure to follow the law and abide by the procedures to spend taxpayer dollars appropriately. these events did not occur as a result of a lack of controls. these actions occurred because of a culture, a culture of excess within the gsa and a lack of respect for the rules and the regulations and the needs of the taxpayers of this country, a country with $15 trillion in debt. i mean, you run through the list of $6300 for coins in velvet boxes, $9,000 conference year book, 58,000 audio visual services, and 136,000 preconference scouting trips. plus a clown, a mind reader.

the gsa employees involved in this incident have broken whatever small amount of trust that the american people may still have had with this government. and it is not just the excesses that has angered so many. it's also the way in which gsa has conducted business. it's deceived -- it's used deceptive tactics to hide the true costs of the conferences. you found the inspector general's found the gsa provided contracts to vendors that undercut competition by disclosing other bids. the gsa violated the contracting rules by awarding source contracts to vendors. the contracts in some cases violated set asides for small business. you can go on and on and on. administrators resigned, two senior gsa officials have been fired. ten individuals have been put on administrative leave. but that's not enough. the taxpayers demand more. a few ceremonial terminations and shuffling employees into new positions or departments are not enough. i understand jeff neely at the center of this investigation is

on administrative leave and is still getting paid. mr. neely and those who planned the conference knowingly defrauded the american people so they could throw a party on someone else's credit card. this is unacceptable. we demand that those individuals -- we must demand that those individuals be held accountable for their actions. this i believe is just the tip of the iceberg, and i hope the committee conducts additional oversight hearings on the excessive gsa spending. madam chairman, thank you so very much for holding the hearing. i look forward to hearing from the witnesses and more from them in the future. >> thank you so much, senator. senator boozman. >> in the interests of time, i'd just like to associate myself with the remarks of my colleagues. i appreciate your leadership and senator inhofe's leadership. we have our differences in the committee, but i think this is something that we're all united on and going forward and finding out exactly what's happened and you know, punish those that were

at fault, and also put in the safeguards so importantly so that this won't happen in the future. with that, i yield back. >> thank you so much. both senator inhofe and i appreciate that. now we're going to turn to the inspector general first. is that all right with you, mr. tangherlini? all right. >> good morning, chairman boxer, ranking member inhofe, members of the committee. good morning, thank you for the opportunity to be here today. while my report details what went wrong at gsa in connection with the western region's conference, i would like to take a moment to focus on what went right. the system worked. the excesses of the conference were reported by my office. were reported to my office by a high-ranking political appointee and our investigation ensued. no one prevented us from conducting that investigation or obstructed what turned out to be a lengthy investigation.

as each layer of evidence was peeled back, we discovered that there was more to look into and so our investigation continued. while some have suggested that the investigation took too long to produce the final report, anyone familiar with law enforcement investigations understands that when you turn over one stone, you often find more stones that need to be turned over as a well. and most people understand the need to be careful and certain before making public allegations such as those contained in the report. because careers and reputations are on the line. and my office does not take that lightly. moreover, the gsa administrator ultimately had control over the date on which this report was released. because it was the administrator's response to the final report that triggered its public release.

the system also worked in that people responsible for the conduct detailed in my report are being held accountable. it is my understanding that after the white house received the final report, the administration took swift action. a new acting administrator was appointed. senior officials were fired, and one resigned. finally, the system has been strengthened by the release of the report. the public attention it received in the media and from both houses of congress and the strong commitment to our efforts demonstrated by the acting administrator dan tangherlini while not one of many career employees and political appointees who were involved in the western region's conference ever came forward and reported the waste and abuse that occurred, perhaps for fear of reprisal, gsa's honest, hard-working employees now have been empowered to bring issues to our attention and they are

doing so. we have more work than ever. i look forward to answering all of your questions. thank you. >> thank you so much, mr. miller. mr. tangherlini. >> good morning, chairman boxer, ranking member inhofe, members of the committee. my name is daniel tangherlini, and i'm the acting administrator of the u.s. general services administration. i appreciate the opportunity to come before the committee today. first and foremost, i want to state that the waste and abuse outlined in the inspector general's report is an outrage and completely antithetical to the goals of the administration. the report details violations of travel rules, acquisition rules, and good conduct. just as importantly, those responsible violated rules of common sense, the spirit of public service, and the trust america's taxpayers have placed in us. i speak for the overwhelming majority of gsa when i say that we are shocked, appalled and deeply disappointed by these

indefensible actions as you are. we've taken strong action against those officials who are responsible and will continue to do so where appropriate. i intend to uphold the highest ethical standards at this agency including referring any criminal activity to the appropriate law enforcement officials and taking any action that is necessary and appropriate if we find irregularities. i also immediately engaged gsa's inspector general. as indicated in the joint letter that inspector general brian miller and i sent to all gsa staff, we expect an employee who sees waste, fraud, or abuse to report it. we want to build a partnership with the ig while insuring their independence to ensure nothing like this will happen again. there will be no tolerance for employees who violate or in any way disregard these rules. i believe this is critical not only because we owe it to the american taxpayers but also because we owe it to the many gsa employees who work hard,

follow the rules, and deserve to be proud of the agency for which they work. we will have also taken steps to improve internal controls and oversight to ensure this never happens again. already, i have canceled all western regions conferences. i've also canceled 35 previously planned conferences saving nearly a million dollars in taxpayers expense. i've suspended the hats off stores and i've already demanded reimbursement from mr. peck, mr. robert shepherd, and mr. neely for private in-room parties. i've canceled most travel through the end of the fiscal year agency wide and centralizing budget authority and have already authorized procurement oversight for regional offices to make them more directly accountable. i look forward to working in partnership with this committee to ensure there's full accountability for these activities so that we can begin to restore the trust of the american people. i hope that in so doing, gsa can refocus on its core mission saving taxpayers money by efficiently procuring supplies,

services and real estate and effectively disposing of unneeded government property. we believe that there has seldom been a time of greater need for these services and the savings they bring to the government and the taxpayer. there is a powerful value proposition to a single agency dedicate odd this work, especially in these austere fiscal times. we need to insure we get back to the basics, conduct this work better than ever. at gsa, our commitment is our service, our duty and our nation, not to conferences, awards or parties. the unacceptable inappropriate and possibly illegal activities at the western regions conference stand in direct contradiction to the express goals of this agency and the administration. and i'm committed to ensuring that we take whatever steps are necessary to hold responsible parties accountable and to make sure that this never happens again. we need to refocus this agency and get back to the basics, streamlining the administrative work of the federal government to save taxpayers money.

i look forwarded to working with committee, moving forward and i welcome the opportunity to take any questions at this time. thank you. >> thank you both very much. as senator inhofe said, you are the good guys in all of this, and susan is a good gal. susan brita who came forward as a political appointee to blow the whistle and it resulted in the president's administrator resigning as she should have and two people being fired. again, i say to miss brita thank you for your courage. this is not easy. i've done a lot of work on whistleblower protection and i know, you got to move the clock here, and i note how hard it is. and the scorn that is oftentimes heaped on those who have the courage to step forward. and you did it for your country. and we appreciate it at this committee. you know, as i researched this and i realized how many scandals there have been involving gsa,