Salazar buries the RIK program
September 16th, 2009 | Agencies Interior | Posted by Gregg Carlstrom
The Interior Department will phase out its controversial royalty-in-kind program, Interior Secretary Ken Salazar announced at a hearing this morning.
Interior’s Minerals Management Service is responsible for collecting revenue from oil and natural gas projects on federal lands. The RIK program collects those royalties as oil or gas instead of cash; the government then sells the minerals and sends the revenue to the Treasury.
But the program has been plagued for years by ethical problems and accounting difficulties. The program puts MMS managers — federal employees — in the odd position of acting like oil or gas salesman. Managers often don’t know whether they’re collecting the correct amount of oil or gas, or selling it at the appropriate price. The non-profit Project on Government Oversight exhaustively documented the problems with the RIK program in a report last year. And a GAO report released this week (pdf) found serious auditing problems with MMS’ natural gas RIK program.
Salazar said today that a replacement program will be phased in. We’ll have more details this afternoon.
Tags: MMS, oil royalties
The more things change…
August 26th, 2009 | Facilities Interior Procurement | Posted by Elise Castelli
This weekend I took a trip to Ellis Island, which is operated by the National Park Service, in New York City.
While I expected to discover quite a bit about the conditions my ancestors endured when they passed through there in the early 1900s, I did not expect to discover a government contracting story that seems to prove the adage “the more things change, the more they stay the same.â€
According to an exhibit at the history of the immigration station, after the original complex of wooden buildings burned to the ground in 1897, the Treasury Department ran a competition for a “fireproof†(masonry) building. With the contract awarded to the firm Boring and Tilton, Ellis Island became the first federal facility to be designed under the competitive procedures prescribed by the Tarnsey Act. The act allowed private contractors to design federally owned structures.
The exhibit also highlighted a couple of contracting problems that persist in government contracting to this day. Specifically, Ellis Island came in behind schedule and didn’t meet the needs of the workers there.
Construction began in September 1898 and was supposed to take 12 months, but, according to the exhibit:
Strikes, contract disputes, and a lack of skilled workmen delayed the opening of Ellis Island’s new buildings until December 17, 1900.â€
In addition:
Officials working on Ellis Island complained about the building’s design and construction…Designed to meet the needs of 500,000 immigrants each year, Ellis Island actually had to accommodate hundreds of thousands more. Over the next quarter century, the island’s facilities, despite periodic additions, were sorely taxed by the growing surge of immigration.â€
Clock runs out on another midnight regulation
April 27th, 2009 | Interior Regulation | Posted by Gregg Carlstrom
We’ve been reporting for months on the Bush administration’s “midnight regulations,” the flurry of often controversial last-minute rules approved in November and December.
The president already announced plans to undo the “conscience rule,” one of most controversial regulations.
And today another rule met its end: Interior Secretary Ken Salazar announced that he’s seeking the end of the “mountaintop mining” rule that allowed coal companies to dump the “fill” — the leftover rocks from mining — in streams.
“We’re cleaning up a major misstep from the previous administration,” Salazar said today at a press conference. “This was bad public policy… it simply doesn’t pass muster.”
Technically, the rule isn’t gone yet. Interior asked the Justice Department to file a pleading in the U.S. District Court; the suit will claim that the regulation has serious legal deficiencies, Salazar said. The courts could then formally strike down the rule.
That verdict would mean coal companies will once again be governed under a 1983 rule, approved during the Reagan administration, which prohibits dumping within 100 feet of streams.
Salazar said the move was largely symbolic, because many states are still using the 1983 rule (coal mining is regulated at the state level). Only Tennessee decided to adopt last year’s regulation.
Tags: mining, regulations
WH announces VA nominees
April 1st, 2009 | Agencies Congress Defense Environmental Protection Agency Interior Transition Veterans Affairs White House | Posted by Rebecca Neal
The White House announced six more political appointees Tuesday, including three for the Veterans Affairs Department.
- Roger Baker, nominee for assistant secretary for information and technology, Veterans Affairs. Baker is the former president and chief executive office of Dataline, a technology company in Norfolk, Va. He also is a former chief information officer of the Commerce Department and served on President Barack Obama’s Technology, Media and Telecommunications policy group during his 2008 presidential campaign.
- William Gunn, nominee for general counsel, VA. He represents military members and veterans in his Northern Virginia law practice. He retired in 2005 from the Air Force, where he was a colonel in the JAG corps.
- John U. Sepúlveda, nominee for assistant secretary of human resources, VA. He is a former deputy director of the Office of Personnel Management, appointed in 1998 by then-President Bill Clinton.
- Anne Castle, nominee for assistant secretary for water and science, Interior Department. She is a partner at Holland & Hart in Denver, where she practices water rights and water quality law.
- Mathy Stanislaus, nominee for assistant administrator for the Office of Solid Waste and Emergency Response, Environmental Protection Agency. He is an environmental lawyer and chemical engineer and champions revelopment of brownfield sites.
- Jo-Ellen Darcy, nominee for assistant secretary of the Army (Civil Works), Defense Department. She is the senior environmental adviser for the Senate Finance Committee.
Tags: Congress, Transition, VA
2010 Budget: Program cuts
February 26th, 2009 | 2010 Budget Agency Management Agriculture Education Interior Procurement | Posted by Tim Kauffman
During a news briefing this morning at the Old Executive Office Building to roll out his 2010 budget, President Obama provided a little more detail about some of the nearly $2 trillion in proposed cuts he mentioned during his joint session to Congress on Tuesday.
The highlights — or lowlights, depending on your view:
- Nearly $200 million at the Interior Department by cutting programs to clean up abandoned coal mines that have already been cleaned up.
- Nearly $20 million by modernizing programs and streamlining bureaucracy at the Agriculture Department.
- Tens of millions of dollars by cutting an Education Department student mentoring program whose mission is being carrried out by 100 other programs in 13 other agencies.
- Nearly $50 billion by cutting out benefits to citizens who aren’t entitled to them and closing tax loopholes to businesses.
Additionally, Obama said the budget would save billions by ending no-bid contracts in Iraq, ending tax breaks for corporations that ship jobs overseas and rolling back tax cuts for the wealthiest Americans.
The $2 trillion is just what has been identified during the first 30 days that the administration has been in office, Obama said. Further cuts will be proposed as part of the full budget Obama said will be released this Spring.
Tags: President Barack Obama
Earl Devaney, SIGSTIM
February 23rd, 2009 | Economic Stimulus Interior | Posted by Gregg Carlstrom
A couple of tidbits about stimulus oversight.
First, the president just announced Earl Devaney as the inspector general for the stimulus program. The name might sound familiar: Devaney has been the Interior Department’s IG since 1999, and he led some big investigations — the Jack Abramoff scandal and the MMS scandal, to name a couple. He’ll undoubtedly have his hands full with the new job (can we call him the SIGSTIM?).
Second, the Interior Department will announce its own “stimulus czar” this week. Interior Secretary Ken Salazar told reporters the yet-to-be-named official is someone with lots of oversight experience. The department stands to collect about $3 billion under the economic stimulus package.
Tags: Earl Devaney, stimulus
It's a crime, but everyone does it
February 3rd, 2009 | Interior | Posted by Gregg Carlstrom
This one is slightly unbelievable.
You may remember Milton Dial from last year’s Minerals Management Service scandals. He pleaded guilty in September to violating federal conflict-of-interest law. And today, he was sentenced by a federal judge, Robert C. Jones.
What was Dial’s punishment?
“I apologize to you, sir,” U.S. District Court Judge Robert C. Jones as he imposed a minimum sentence on Milton Dial, a former deputy associate director in the Lakewood, Colo., office that handled billions of dollars of oil and natural gas contracts.
The judge said he felt Dial, who retired from the agency in 2004 after 33 years and opened a consulting business in Las Vegas six months later, had been “selected out for prosecution” on a conflict charge that “high executives in our government violate all the time.”
Yes — the judge apologized to Dial, said he was breaking the same laws as countless other “high executives,” and gave him the lightest possible sentence.
Tags: Jimmy Mayberry, Lucy Denett, Milton Dial, Minerals Management Service
Salazar will focus on two ex-MMS employees
February 3rd, 2009 | Interior | Posted by Gregg Carlstrom
We reported last week that Interior Secretary Ken Salazar wants the Justice Department to reopen its investigations into the scandals at the Minerals Management Service.
A quick update: According to several sources at the department, Salazar is specifically interested in Gregory Smith and Lucy Denett. They’re both former high-ranking Interior officials; Justice declined to prosecute either one.
Smith is a former director of the controversial royalty-in-kind program at MMS. He took tens of thousands of dollars in consulting fees from a company that wanted to do business with oil and gas companies, and accepted gifts and trips from the industry. Denett ran the Minerals Revenue Management agency, part of MMS, and steered more than $1 million in contracts to a friend.
Interior’s IG, Earl Devaney, referred both cases to Justice’s public integrity division, which decided not to investigate either one; many observers said that was a surprising decision. And it’s why Salazar wants to reopen the investigations, according to my sources. But he’s not interested in reviewing cases that Justice has already investigated.
Tags: Gregory Smith, Ken Salazar, Lucy Denett
Salazar: Reopen criminal investigation at MMS
January 29th, 2009 | Interior | Posted by Gregg Carlstrom
Interior Secretary Ken Salazar is asking the Justice Department to review ethical scandals at the department and considering an overhaul of the Minerals Management Service’s royalty program.
Salazar made the announcement after a meeting with MMS employees at the agency’s offices in Lakewood, Colo. The agency was the subject of scandal in September: A report from the department’s inspector general highlighted illegal drug use by employees and a cozy relationship with the energy companies MMS regulates.
MMS is responsible for collecting royalties from oil and gas projects on federal lands.
Justice decided not to prosecute two high-ranking employees cited in the report, and they couldn’t be punished internally because they had already left the agency. Salazar is asking the Justice Department to review that decision; he also wants Interior to review the personnel actions it took against employees who still work for MMS.
Salazar to visit MMS
January 28th, 2009 | Interior | Posted by Gregg Carlstrom
Ethics seemed in short supply at the Interior Department’s Minerals Management Service last year; we reported on revelations of illicit sex with oil company executives, major conflicts of interest, and concerns that the agency’s royalty program wasn’t getting the best value for taxpayers.
To that end: President Obama’s new Secretary of the Interior, Ken Salazar, will visit the agency’s Colorado offices tomorrow and announce the first steps in his ethics reform plan. He’s holding a press conference after his meeting with MMS employees; we’ll have more details tomorrow afternoon.
Salazar made a quick appearance at today’s White House briefing, and told reporters he might re-open investigations closed by the Bush administration. He didn’t provide any details.