Defense Contract Award Protested
By Walter F. Roche Jr.
The Los Angeles Times

Friday 26 October 2007

Washington - A Defense Department medical services contract worth up to $790 million was awarded last month to a Wisconsin-based company three months after it hired a former Bush administration appointee who had supervised military health programs at the Pentagon for the last six years.

William Winkenwerder Jr., assistant secretary of Defense for health affairs from 2001 until April, joined Logistics Health Inc. as a director and consultant in June. The firm beat out two other bidders with proposals that ranged from $80 million to $100 million less, records show. Under the new contract, Logistics Health will provide immunizations and physical and dental exams for reservists and National Guard members.

Logistics Health of LaCrosse, Wis., is headed by another ex-official of the Bush administration - former Secretary of Health and Human Services Tommy Thompson.

"They stacked the deck," said Fran Lessans, president of Passport Health, one of the losing bidders. Her Baltimore-based firm lost despite a bid projected over five years to cost nearly $100 million less than Logistics Health's winning proposal.

"It was wired. There is no doubt in my mind," Lessans said of the Defense procurement process.

Two other firms involved in the bidding have filed formal protests with the Government Accountability Office. A draft copy of one protest letter, reviewed by The Times, cited Winkenwerder's role and complained that the winning bidder may have "gained unequal access to information not available to other competitors" by hiring the former Pentagon official.

"This creates an organizational conflict of interest and potentially constitutes prohibited contact," the draft letter said.

Winkenwerder called such allegations inaccurate and untruthful. In e-mail responses to The Times, he said he had nothing to do with the procurement process or the selection of Logistics Health. He also said he had not begun contacts with Logistics officials about the directorship and consulting job until after he had resigned his Defense Department post.

His role at Logistics Health is to provide advice, he said, "on a variety of issues that are of concern and priority to the company. Government rules do not prohibit such advice in any way."

The rules bar him from contacting his former Pentagon colleagues on Logistics' behalf, "and I have followed those rules scrupulously. Further I support such rules and place a high importance on strict ethical behavior in all of my conduct."

Diana Henry, a spokeswoman for Logistics Health, said in a written statement that the company "conducts all of its business activities in a highly ethical and professional manner."

The contract, awarded in September, supports the Defense Department's Reserve Health Readiness Program. In prepared remarks for a subcommittee of the House Armed Services Committee two years ago, Winkenwerder said the program's goal was "to identify and proactively assist service members in getting needed support for deployment-related concerns." Besides routine exams, the program will provide full medical assessments to reservists and Guard members returning from Iraq and Afghanistan.

Logistics Health will be paid an estimated $151 million for the first year of a contract that can be renewed annually and extended up to five years at a total cost of about $790 million.

In other letters of protest filed with the GAO, officials of rival firms also charged that Logistics won the pact despite questions raised about its performance under a previous agreement with the Department of Health and Human Services. That pact, originally awarded in 2001, only applied to the Army, while the new one includes the Navy, Air Force and Marines.

Kenneth Moskowitz, an attorney for the Pennsylvania-based United States Military Dental Corp., said in an Oct. 12 letter that Logistics' prior performance and practices under the Health and Human Services contract "put reservists and National Guardsmen at possible undue risk."

He told the GAO that "no one was assigned to specifically monitor the level of care" received by military personnel and that the company operated with "a built-in incentive to lower provider cost for added profit." The Pennsylvania company was a subcontractor for Comprehensive Health Services of Florida, one of the failed bidders.

A spokesman for the Defense Department, citing the pending protests, declined to respond to a series of detailed questions about the contract and the selection process.

Records reviewed by The Times show that the Logistics Health bid also survived a major last-minute change when partner QTC Management abruptly withdrew days before the contract was awarded.

QTC Chairman Anthony J. Principi, another former Bush appointee, was secretary of Veterans Affairs.

The GAO has until early January to act on the protests.

The Defense Department gave initial notice of its intent to put the newly expanded program out to bid in October 2006.

Winkenwerder resigned from his Pentagon post April 16, and his appointment to the Logistics board was announced May 31. It became effective the next day. In announcing Winkenwerder's appointment, Thompson said: "He brings with him a wealth of knowledge and also shares LHI's commitment of helping military members receive the healthcare and support they deserve. He is a tremendous addition to our board of directors."

The formal notice of the bidding process was issued June 12. Bids were due July 26. On Sept. 10, QTC formally withdrew from the Logistics proposal. And on Sept. 25, the contract was awarded to Logistics.

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Security Chief Shows Whistleblower Support

Lawmaker Admonishes Top TSA Administrator

Wednesday, October 17, 2007
BY RON MARSICO
Star-Ledger Staff

WASHINGTON -- Under intense grilling from a member of Congress, the head of the U.S. Transportation Security Administration yesterday said agency employees who disclose security problems at the nation's airports should be protected from retaliation by their bosses.

TSA Administrator Kip Hawley insisted his agency encourages its employees to come forward about problems, despite sharp skepticism from Rep. William Pascrell (D-8th Dist.), who said a history of TSA retaliation against its employees showed a need for stronger protections.

The congressman questioned Hawley at a hearing of the House Homeland Security Committee's subcommittee on transportation security, citing cases outlined this weekend in The Sunday Star-Ledger.

Hawley stopped short of endorsing pending legislation that would extend protections under the federal Whistleblower Protection Act to the nation's 43,000 checkpoint and baggage screeners. Currently, they have only limited protections.

"We need to be open and transparent with our work force about our vulnerabilities," said Hawley, who has headed TSA since mid-2005. "Workplace intimidation ... is a sickness, a vulnerability that has to be stopped."

But Pascrell chided Hawley, growing frustrated as the TSA chief pronounced himself unfamiliar with the details of specific cases Pascrell asked about, including a Las Vegas air marshal fired in 2006 for alerting the media to a cost-saving directive that would have reduced the number of marshals on cross-country flights.

"Get familiar with these cases and get back to us. ... This is unacceptable," Pascrell said. "You're supposed to know these things."

Although Pascrell peppered the TSA chief, other members of the committee failed to jump in.

Pascrell also said he was unhappy the agency sent internal affairs agents to Newark Liberty International Airport in October 2006 in an unsuccessful effort to determine the sources of a story that screeners there missed 20 of 22 covert tests.

"The public needs to know, has a right to know what's going on in any airport in this country," Pascrell said. "Don't you agree with that?"

Hawley said he agreed on policy issues, but not test results that could show vulnerabilities at specific airports. He said that is "classified information" that brings the agency's response "into a different realm."

Asked by a reporter after the hearing whether he would seek a review of the cases listed by Pascrell, Hawley responded, "Of course." Pressed about what such a review would entail and how long it might take, Hawley did not respond and walked away.

Pascrell also asked Hawley about legislation by Rep. Henry Waxman (D-Calif.) to cover TSA's 43,000 baggage and checkpoint screeners under the federal Whistleblower Protection Act, while also strengthening limitations in the act itself.

TSA administrative staff, high-level officials and air marshals are covered by the act, while screeners have only limited protection through the U.S. Office of Special Counsel.

"Don't you think they should be protected?" Pascrell asked Hawley, referring to the screeners.

"Yes, no question. We have those protections today," Hawley said.

In an interview during a break prior to Pascrell's questioning, Hawley said TSA has made efforts to let its employees know they can disclose agency shortcomings, noting there are listings on its Web sites about how and to whom official reports may be made.

"You can't do this job if the work force is not trusting of the leadership team," Hawley said. "Chasing after leaks is not a productive activity."

But he said it was important to keep test results like those revealed at Newark Liberty secret. Each day, he said, some 2,500 covert tests are conducted at the nation's airports.

"It would indicate some vulnerability" to terrorists if the results become public, he said. "Our job is to attack the vulnerability before they do and close it."

Ron Marsico may be reached at rmarsico@starledger.com or (973) 392-7860.)
© 2007 The Star Ledger

From The Boeing Company, Press Release

Andrew K. Ellis Joins The Boeing Company in Washington, D.C.
ARLINGTON, Va., Feb. 02, 2000 -- Andrew K. Ellis will join The Boeing Company's Government Relations office in Washington, D.C., as vice president, Aircraft & Missiles Programs.

Ellis, 40, will be responsible for leading the development and execution of government relations strategies for Boeing programs and issues related to the Department of Defense and in support of the company's Aircraft & Missiles business unit headquartered in St. Louis, Missouri. Boeing's Aircraft & Missiles Group manages numerous Air Force, Army, Navy and Marine Corps programs as well as Aerospace Support programs and the Joint Strike Fighter program. He will be the principal focal point between the Aircraft & Missiles Group and the Government Relations office.

Ellis comes to Boeing from the U.S. House of Representatives Committee on Armed Services, where he has served for the past 13 years, most recently as staff director. Previously he was legislative assistant for National Security Affairs for Rep. Duncan Hunter (R-CA).
We are proud to have a true professional with such proven leadership skills and extensive experience in Washington, D.C.," said Chris Hansen, senior vice president, Boeing Government Relations. "As we strive to become more customer-focused, Andy's vast knowledge of the defense department's programs and policies will serve us well."
Ellis holds a bachelor's degree from the University of Vermont and master's and doctorate degrees in International Relations from the University of Southern California.

I found these fascinating little blurbs this evening on TPM Muckraker. I was really wondering what would happen to Bill Allen, former CEO of VECO, when the involvement with Sen. Stevens and the rest of the Alaska bunch hit the fan. There are a few other interesting notes here as well. The sheer breadth and depth of corruption is astounding. I was reading the piece earlier this afternoon that was discussing the signs of a nation’s decline in health and welfare. (See quote and web address)

“All great nations throughout history have peaked and declined. Common among the indications of deterioration were blatant corruption at the political and corporate levels, a descent in morality bordering on outright debauchery and the use of paid mercenaries to defend the country’s interests.”

(http://viewfromthemeadow.com/bushsecretarmy.html)

A brief stroll though whistleblower complaints posted and discussed in blogs on the Internet, as well as in mainstream and alternative news media sources brings about for the thoughtful reader, recognition of a troubling picture.
-GFS

Robert Fromm, former Defense Department official and employee of Michael Wade's infamous contracting company MZM, has pleaded guilty to one count of violating a lifetime employment ban. Fromm has expressed his willingness to talk with officials about ongoing investigations. He is scheduled for sentencing in January. (Charlottesville Daily Progress)

Earning reports for Washington lobbying firms were very strong in the first half of 2007. According to CQ.com, a half-dozen midsize firms “at least double[d] their average six-month take during the 109th Congress.” Jim Turner, a former Democratic representative from Texas (top Democrat on Homeland Security Committee) had to sit out last season because of revolving door rules, but this year he is credited with tripling; the income of Arnold & Porter. (CQ)
Federal authorities have raided the home of disgraced fundraiser Norman Hsu. They seized all the fun stuff, including his wine collection (valued over $100,000) and a saxophone signed by Bill Clinton. (AP)

Former Veco CEO Bill Allen has pleaded guilty to crimes including bribing public officials. Executives at his former firm have pleaded guilty to “crimes including making conduit contributions to politicians -- basically giving employees money to make contributions to politicians.” Nonetheless, few people who have received Veco cash have felt compelled to return it. Much of it can be found in the coffers of campaign funds of members of the Senate appropriations committee. (American Public Media)

Yesterday we reported that the Environmental Protection Agency had settled a huge case that would require $5 billion in cleanup for American Electric Power. Despite the case being opened under the Clinton administration, Bush fans were calling the case vindication for the administration's choice to focus the EPA on a handful of particularly large cases (which would explain the noticeable paucity in investigations over the past six years). But that talking point has already been put to rest, as Bush's EPA has announced that it no longer intends to prosecute or enforce similar cases. (Washington Post)

The Army has had better success in the past few months of meeting its recruitment targets, but at a certain price. In order to meet quota, the Army has been accepting more soldiers who do not have a high school degree. And, since the start of the war in 2003, the Army has doubled the percentage of new recruits with criminal records. (Chicago Tribune)

In the "Where Are They Now?" file, former Congressional aide-cum-lobbyist-cum-aide again Jeffrey Shockey has made the quiet transition to soccer dad, at least according to his charitable giving. Shocker was a former aide to Rep. Jerry Lewis (R-CA) who later demonstrated an "insider's talent" for securing funds from Lewis' committees. Seven of Shocker's lobbyist clients have already been subpoenaed in federal investigations. (Harper's)

From TPM Muckraker
By Peter Sheehy and Will Thomas - October 11, 2007, 9:47AM

I ran across the little note about Andrew Ellis, in an online Alumni publication. It appears he is another government employee moving directly from government employ to a high position at a defense contractor. This kind of activity is already against government personnel policy, but seems to be rarely enforced these days. I wonder how many more we could list here? Please send in more examples as you come across them. I will add them to the list. Thanks! VM

Andrew Ellis left his job in the U.S. Congress after 15 years to become vice president of the Washington, D.C., office of the Boeing Company. Class of 1981: University of Vermont Online News http://www.uvm.edu/~uvmpr/vq/VQSummer02/CN70-80.html

Carol Haave was a former President of Sullivan/Haave Associates, a business she founded with her husband, Terry Sullivan. She later became the Deputy Undersecretary of Defense C3I, and her company subsequently was awarded lucrative Iraqi contracts while she remained in her government position.

Greg Gwash, Deputy Director, Industrial Security, Defense Security Service moved directly from that government position with oversight of The Boeing Company to Director, Security and Fire Protection and Facility Security Officer, Boeing- Seattle in 1997.