GSA chief resigns, employees fired for costly conference

The head of the General Services Administration (GSA) resigned Monday and two deputies were fired after an internal report revealed excessive spending at a conference. 

GSA Administrator Martha Johnson stepped down after more than two years on the job. Public Buildings Service chief Robert Peck and Stephen Leeds, an adviser to Johnson, were fired Monday. 

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Four other employees involved in organizing an October GSA conference to Las Vegas — an event that cost $822,851 and included a clown and mind reader — were put on administrative leave.

Expenses for trips to scout the Las Vegas site totaled more than $100,000 for travel and $30,000 for catering, according to an inspector general (IG) report, and the remainder of the more than $686,000 was spent on the conference.

"I take this action with great sorrow." Johnson said in her resignation letter, which was accepted by President Obama. She said she needed to step aside "so that the Agency can move forward at this time with a fresh leadership team."

While Johnson said she felt the agency has taken steps to affect government operations, in this case, there was "a significant misstep."

"Reports of an internal conference in which taxpayer dollars were squandered led me to launch internal reviews, take disciplinary personnel action and institute tough new controls to ensure this incident is not repeated," she said.

The agency spent $146,527 on catered food and beverages for the conference, including $5,600 for three semi-private catered in-room parties and a networking reception with petit beef wellington, monte cristo sandwiches, 1,000 sushi rolls, cheese plates and pasta stations, according to the IG report.

Also during that reception, GSA paid $525 for two hours of bartender service fees for a cash bar. The total cost of the reception was $31,208. 

Commemorative coins were also presented to employees at that event. 

"We do not believe this expense can be justified as either an award ceremony or light refreshments, based either on the nature of the event or the amount spent, over $100 per person," the IG report said. 

At the closing-night dinner, all participants received a yearbook containing pictures of all those attending the conference, taken when they checked into the hotel. GSA also printed souvenir books for the regional ambassadors, totaling more than $8,130.

GSA purchased numerous other items for distribution to conference participants, paying $2,781 for canteens and carabiners and $3,749 for shirts for all conference participants for a team-building activity. 

Obama was told about the expenses shortly before leaving for his trip to South Korea last week. 

"He was outraged by the excessive spending, questionable dealings with contractors and disregard for taxpayer dollars," said White House Chief of Staff Jacob Lew. 

"He called for all those responsible to be held fully accountable given that these actions were irresponsible and entirely inconsistent with the expectations that he has set as president," Lew said. 

House Oversight and Government Reform Committee Chairman Darrell Issa (R-Calif.) blasted the GSA's spending spree.

“After President Obama lectured the private sector about not wasting funds on Las Vegas conventions, it’s hypocritical that such a large agency with critical management responsibilities across government would hold this luxurious conference at the height of the recession and even spend thousands on custom made coins touting the stimulus," Issa said in a statement.

Johnson was confirmed by the Senate in February 2010 after a nearly 10-month delay caused by former Sen. Kit Bond (R-Mo.) who was trying to pressure GSA administrators to approve a $175 million federal building project in Kansas City.
 
"The president respects Administrator Johnson’s decision, and believes as stewards of the taxpayer dollars, these episodes are not acceptable," Lew said.

Johnson will be replaced by Dan Tangherlini, an assistant secretary in the Treasury Department.

The Washington Post first reported the news of the GSA conference. 

— This story was last updated at 6:51 p.m.