A Corps of Engineers official had called Halliburton's no-bid contract
'blatant and improper' during congressional testimony.
By T. Christian
Miller Times Staff Writer
August 30, 2005
WASHINGTON —
Congressional Democrats demanded an investigation Monday into the demotion of a
senior U.S. military contracting official who publicly criticized a
controversial no-bid contract awarded to Halliburton Corp. for work in Iraq.
With more than 20 years' experience in government procurement, Bunnatine
Greenhouse had been the Army Corps of Engineers' top contracting officer until
she was demoted Saturday to a lower-level position. A military report indicated
that she was demoted for poor job performance.
Greenhouse had repeatedly
challenged the corps' commanding officers on their decision in 2003 to give a
contract worth up to $7 billion to repair oil infrastructure to Halliburton, the
Houston-based oil services company once run by Vice President Dick
Cheney.
"They went after her to destroy her," said Michael Kohn, her
attorney, who added that the demotion was "absolutely" in retaliation for her
complaints about the Halliburton contract.
Democrats, who had invited
Greenhouse to testify about her concerns at a June hearing, asked Defense
Secretary Donald H. Rumsfeld in a letter Monday to investigate and to reinstate
her in the meantime.
At that June hearing, Greenhouse called the
Halliburton case "the most blatant and improper contract abuse I have witnessed
during the course of my professional career." Three weeks later, the secretary
of the Army approved the Corps of Engineers' decision to demote her. It took
effect over the weekend.
"Retaliation against employees for providing
information to Congress is illegal and entirely unacceptable," said the letter,
which was signed by Rep. Henry A. Waxman (D-Los Angeles) and Sens. Byron L.
Dorgan (D-N.D.) and Frank R. Lautenberg (D-N.J.). "Ms. Greenhouse has given
Congress important information essential to our oversight of waste, fraud, and
abuse."
Greenhouse also angered insurance companies with a proposal
intended to save hundreds of millions of dollars by offering cheaper workers'
compensation-style insurance to federal contractors. Her initiative drew sharp
resistance from some of the country's most powerful insurance companies, which
could lose business under the proposal.
The corps was scheduled to make
an announcement on the cost-savings program as early as September. It was
unclear Monday whether Greenhouse's demotion would affect the program, which
would have awarded the insurance to a single carrier through competitive
bidding. "This was her baby. She's the one who fought for this thing. And she
made some people upset," said one insurance industry official who has monitored
the program.
The Army general who hired Greenhouse, who is black, said
her race and sex also played a role in her demotion. Known for her insistence on
following rules, she clashed repeatedly with a mostly white "old boy" network at
the Corps of Engineers, according to Lt. Gen. Joe Ballard.
"Greenhouse's
race and gender ruffled a lot of feathers in the Corps command and also
contributed to the disparate and highly critical treatment she has received,"
Ballard wrote as part of a deposition given during an internal process to appeal
her demotion. Ballard, who is also black, said he had received "similar
treatment" even as a commander.
Both the corps and the Department of the
Army declined comment, citing privacy restrictions surrounding personnel issues.
But a Corps of Engineers report provided by Kohn showed that top officials
criticized Greenhouse for not being a team player.
The report said
Greenhouse's poor performance ratings were due to "Ms. Greenhouse's insistence
on restricting her role as the Corps senior contracting official to merely
passing judgment on matters presented to her, instead of personally engaging in
a collaborative process with other Corps leaders."
Greenhouse had also
been criticized for writing notes by hand on official corps contracting
documents, according to the report.
Greenhouse's demotion is the latest
twist in a drama that began more than two years ago, when she raised concerns
about giving Halliburton's subsidiary, KBR, the oil contract in Iraq for five
years. She thought that the contract should have been for a shorter period to
allow competitive bidding to take place sooner.
In December 2003, she
accused the corps of deliberately bypassing her to excuse Halliburton from
having to provide auditors with cost data to justify the price it had paid to
import fuel into Iraq. In the summer of 2004, she opposed the Corps of
Engineers' efforts to extend a Halliburton contract to feed and house U.S.
troops in the Balkans, arguing that it should have been competitively
awarded.
In October 2004, Lt. Gen. Carl Strock, the corps commander,
attempted to demote Greenhouse, citing a history of negative performance
reviews. Instead, she went public, and her complaints became an election-year
controversy because of Cheney's ties to Halliburton.
In response, the
Army promised to have the Pentagon'sinspector general
investigate Greenhouse's complaints of abuse and directed Strock to "suspend any
adverse personnel action so that Ms. Greenhouse remains in her current position
until a sufficient record is available to address the specific matter" raised by
her case.
In June, Strock sent a memo, with an unsigned, nine-page report
rebutting Greenhouse's accusations, to the Army's inspector general. Strock said
the report showed that Greenhouse's demotion "is based on her performance and
not in retaliation for any disclosures of alleged improprieties she may have
made."
Among other defenses, the report noted that the Government
Accountability Office had concluded that the oil contract had been properly
awarded. The report found problems elsewhere in the decision-making.
The
Pentagon inspector general's investigation into Greenhouse's accusations is
continuing, and investigators are working with the Department of Justice on
"potential prosecutions," according to the letter from the congressional
Democrats. Kohn said the inspector general also had promised to investigate
whether Greenhouse's demotion was an illegal retaliatory action.
The
Pentagon's inspector general did not return repeated calls for comment.
