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VA's HR chief resigns amid conference scandal

Oct. 1, 2012 - 03:03PM   |   Last Updated: Oct. 1, 2012 - 03:03PM  |  
FTN: VA Orlando HR Conference Videos
FTN: VA Orlando HR Conference Videos: "Patton" videos shown at two VA conferences held last year in Orlando, Florida. Obtained by the House Committee on Veterans' Affairs.
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John Sepulveda is assistant secretary for human resources at Veterans Affairs. (Army Times)

Two multimillion-dollar conferences for Veterans Affairs Department human resources officials have resulted in the resignation of the agency's top personnel official, as an internal investigation found excessive spending and evidence that some of those planning the events had improperly accepted gifts from potential vendors.

The report, released Monday by the VA's Office of Inspector General, found $6.1 million spent on two weeklong conferences at the Orlando Marriott World Center Golf and Spa Resort, held in July and August 2011, with about $762,00 being on "unauthorized," "unnecessary" or "wasteful" expenses, according to the report.

The report is especially hard on John Sepulveda, the VA assistant secretary for human resources, who "abdicated his responsibilities when he failed to provide proper guidance and oversight to his senior executives," the report says. Sepulveda has resigned.

Eleven VA employees responsible for conferences, including site selection and other planning, "improperly accepted gifts from contractors seeking to do business or already doing business with VA," the report says. The names of the employees are omitted from the public report, but VA officials said some could face disciplinary action.

Improper gifts included massages, meals, limos, helicopter rides, gift baskets and Rockettes tickets, according to the IG report. In only one case, referred for possible criminal prosecution, the VA employee solicited the gift, IG officials said. The gifts did not seem to influence decisions on the location of the conference or on which vendors received businesses, IG officials said.

In a reaction to the report, the VA issued a statement promising stronger controls.

"Misuse of taxpayer dollars is completely unacceptable," the statement says. "The actions cited in the report represent serious lapses in oversight, judgment, and stewardship."

VA Secretary Eric Shinseki, who did not attend the conferences, "has taken immediate action to address the issues outlined in the IG report," the statement says.

Shinseki will "appoint senior officials to review evidence of wrongdoing and to recommend appropriate administrative action," the statement says. Two employees have been placed on paid administrative leave pending their review.

The $6.1 million in total expenses and $762,000 of waste may not be a full accounting, the IG report says, noting "many conference costs were not sufficiently documented, which made them difficult to clearly justify, or identify whether they were accurate, appropriate, necessary or even reasonably priced."

While faulting expenditures and cost controls, the IG report says the two conferences did serve a "valid training need" for VA human resources workforce.

The conferences had gained attention because planners spent almost $50,000 for an actor who portrayed Gen. George Patton in videos and personal appearances, but the report said the Patton performance was just a small sample of larger excesses.

It found $280,000 in excess costs for food, beverages, catering and miscellaneous expenses; $154,000 in contractor travel where expenses were unsupported by documents; and $97,000 in "unnecessary" promotional items for those attending, including pedometers, exercise bands, USB hubs, notebooks, water bottles and duffel bags.

The VA employee who signed off on the nearly $50,000 Patton parody did not have authority to commit government expenses, a problem investigators said they also found when reviewing other expenses.

Sepulveda resigned Sunday, telling the newspaper Federal Times he was quitting because he "did not want to be a distraction for the administration." He also had the title of chief human capital officer at VA.

He was not the most senior official to attend the two conferences. Deputy VA Secretary Scott Gould and Steve L. Muro, VA undersecretary for memorial affairs, also attended the events, although both made only brief appearances, according to detailed schedules of events and speakers.

The findings, which had been expected by Congress since word of the expensive conferences spread earlier this year, were still disappointing for lawmakers.

"I am deeply dismayed," said Sen. Patty Murray, D-Wash., chairwoman of the Senate Veterans' Affairs Committee. "The blatant waste of taxpayer dollars and government employees improperly accepting gifts cannot and will not be tolerated," she said.

The wasteful spending is a huge amount, said Rep. Jeff Miller, R-Fla., House Veterans Affairs Committee chairman. Governmentwide cuts on conferences were ordered last year after attention was called to a General Services Administration event in Las Vegas where the total cost was $823,000, Miller said.

The VA conferences show "a clear lack of leadership and accountability" by senior VA leaders, he said. "It is blatantly clear the VA does not know how much it spends on conferences."

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