Panel demands better oversight of DHS contractors

Senior members of the House Homeland Security Committee on Thursday called on the Homeland Security Department to increase oversight of its contractors -- and said they are expanding their investigation into whether the department improperly awarded contracts to a limousine service that is under federal investigation for possibly providing prostitutes to public officials.

At a hearing Thursday, Republicans and Democrats alike lashed out at department officials over the five-year, $21.2 million contact awarded last year to Shirlington Limousine and Transportation Inc. of Arlington, Va., to drive senior Homeland Security employees and officials around Washington. The company had previously received a $3.8 million contact from the department in 2004.

The FBI is investigating whether military contractors linked to former Rep. Randy (Duke) Cunningham, R-Calif., arranged for the company to provide prostitutes for him and other lawmakers. Cunningham pleaded guilty last fall to taking $2.4 million in bribes from military contractors.

House Homeland Security Management Subcommittee Chairman Mike Rogers, R-Ala., questioned the department's process for doing background checks on contractors, saying the owner of Shirlington, Christopher Baker, is a felon. Rogers suggested that the department should investigate the backgrounds of executive officers and board directors of small companies before contracts are made.

Rogers added that his subcommittee plans to hold another hearing to examine the contract to Shirlington in early June.

House Homeland Security Chairman Peter King, R-N.Y., said proper background checks of Shirlington drivers are especially important because they have access to senior department officials and can overhear their conversations. King said the department should raise its standards for doing background checks on contractors. "To me, this is something that should be looked at. I wouldn't trivialize it," he said.

Rep. Bill Pascrell, D-N.J., said the department's chief procurement officer, Elaine Duke, told the committee in response to a letter that four companies originally applied to compete for the contract awarded in 2004. Three companies were disqualified because they did not meet criteria of the Historically Underutilized Business Zone program, leaving only Shirlington as a qualified bidder, Duke said.

But Pascrell questioned why the department did not re-bid the contract. "I would say this is very suspicious, which indicates to me that it was politically precipitated," he said. He added: "It's completely bewildering to me that anyone who has this kind of a rap sheet could ever get a penny from the Department of Homeland Security."

Dwight Williams, chief of the department's Office of Security, said background checks were run on all Shirlington employees who had access to department officials. He said the department does not usually run background checks on company owners if they do not have such access.

Duke added in her letter that Shirlington's designation as a HUBZone business was challenged by one of the losing bidders. She said the Small Business Administration reviewed the matter and determined that Shirlington met all of the requirements for a HUBZone business.