Rep. Jeff Denham, R-Calif., says such 'blatant waste' should bring 'serious consequences.'

Rep. Jeff Denham, R-Calif., says such 'blatant waste' should bring 'serious consequences.' AP photo

Pricey awards program paraded as new example of GSA excess

Agency gave away $438,750 in iPods and other swag over four years, IG finds.

This story has been updated.

In addition to its over-the-top 2010 Las Vegas conference, the General Services Administration ran a “Hats Off Store” awards program that doled out hundreds of thousands of dollars in iPods, digital cameras and other expensive gifts to Public Buildings Service employees, according to an audit report obtained by House Republicans.

The Hats Off program spent $438,750 on awards from fiscal 2007 to fiscal 2010, a redacted version of the June 2011 GSA inspector general report released late Friday said. In fiscal 2009 alone, the average prize per Public Buildings Service employee was $328, well exceeding the $99 limit, the report said.

Leaders of the House Transportation and Infrastructure Committee learned of the awards program during briefings on GSA spending. On Thursday Reps. John Mica, R-Fla., chairman of the committee, and Jeff Denham, R-Calif., chairman of its Economic Development, Public Buildings and Emergency Management Subcommittee, wrote a letter to the GSA inspector general requesting more information and any reports on the awards program.

The GSA inspector general’s office declined to comment Friday, but a GSA spokesman said the agency has closed its regional Hats Off stores. “Operations have been suspended pending a continuing top-down review of all spending,” he said.

The IG report said the awards program began in 2001, with smaller trinkets such as mugs and mouse pads, but gradually expanded into much higher-end items. Even in the four years from fiscal 2007 through fiscal 2010, spending on the awards program -- run out of Public Buildings Service Region 9, the same region responsible for the Las Vegas conference -- jumped significantly, from less than $50,000 in both fiscal 2007 and fiscal 2008 to more than $100,000 in fiscal 2009 and fiscal 2010.

In addition to the high price-tag for the prizes, the lawmakers said they were concerned that program administrators were among the top award recipients, and that GSA failed to keep the swag secure. In fact, the IG started looking into the program because of stolen iPods and the IG noted broader flaws with GSA’s system for tracking the program’s inventory.

Furthermore, there were “award abuses, including patterns of employees exchanging awards with one another and supervisors accepting awards from subordinates,” the IG report stated.

Mica and Denham said the regional commissioner responsible for both the Hats Off program and the $820,000 Las Vegas conference received a bonus of $9,000, even after officials had received internal IG briefings on both issues. “Remember, this was at the time when President Obama announced a two-year federal employee pay freeze,” Mica noted in a statement Friday.

“The arrogance of [GSA] giving away a grab bag of free stuff to its employees instead of effectively managing our federal properties is a disgrace,” Denham said. “There must be serious consequences for this type of blatant waste of taxpayer dollars.”

Denham’s subcommittee has scheduled a hearing on GSA for April 19.

Charles S. Clark contributed to this report.