Obama Removes AmeriCorps IG Who Clashed With Ally: Politicized Firing, Or Just Dessert?

June 12, 2009 11:40 a.m.

We weren’t sure what to make of the news that President Obama has decided to fire the inspector general of the Corporation for National and Community Service (CNCS). The IG, Gerald Walpin, had been investigating the misuse of federal AmeriCorps funds by a nonprofit group run by Kevin Johnson, a former NBA basketball player and Obama supporter who’s now the mayor of Sacramento.

But since we think of politicized firings as kind of our beat, we figured it was worth looking into. So here’s a quick rundown on how things got to where they are, based on reporting by the Sacramento Bee:– In April 2008, federal agents (meaning Walpin’s IG office, it seems, though the reporting is unclear) began investigating the use of federal grant money by the St. HOPE Academy, a Sacramento non-profit then run by Johnson.

– The following month, local law enforcement announced that no criminal case could be made against Johnson, but the federal probe continued.

– In June, Johnson beat the incumbent mayor, Heather Fargo, in the Democratic primary. But because he didn’t win 50 percent of the vote, he would have to face her again in a runoff in November.

– Later that month, the Bee reported that the federal investigation into St. HOPE had expanded to look at the possible misuse of $807,000 in AmeriCorps funds.

– In September, the federal probe was turned over to the U.S. attorney’s office in Sacramento.

– Later that month, Walpin, on behalf of CNCS, released the findings of the federal probe, which it appears he had led. Walpin found that St. HOPE had improperly used hundreds of thousands of dollars in grant money, by using AmeriCorps volunteers to run errands for Johnson, wash his car, and do political work relating to a local school board race. Saying he had found “potential criminal violations,” Walpin recommended that while the US attorney’s office’s investigation was ongoing, Johnson and another St. HOPE official be barred from receiving federal money. But as the Bee would later note in an editorial, “Walpin decided to act before any legal body determined whether irregularities in the administration of grants from 2004-2007 reflected inadvertent errors and ignorance of regulations or actual fraud.”

– Nonetheless, days later, a “debarment official” at CNCS followed up on Walpin’s recommendation, taking the rare step of issuing a letter suspending Johnson and the other official from receiving federal funds. Walpin touted the news in “huge red headlines” on his IG website, according to the Bee.

– The Bee would later find that, since its inception in 1994, the NCSC had suspended only two other organizations and three other people, and that the irregularities at St. HOPE were similar to those found at other nonprofits that were not suspended.

– Johnson’s camp called the findings “relatively minor issues,” and called Walpin, who was appointed to his post by President Bush, a “right-wing Republican.” Johnson’s campaign cited a 2005 incident in which Walpin had introduced Mitt Romney at a meeting of the conservative Federalist Society — on whose board Walpin sits — by saying that Romney served as governor of a state, Massachusetts, run by the “modern-day KKK … the Kennedy-Kerry Klan.”

– On November 4, Johnson won the mayor’s race 57-42 over Fargo.

– Two days later, US attorney McGregor Scott, a Bush appointee, announced that the investigation into the misuse of funds did not warrant criminal charges. Scott said he had asked Walpin’s office to go back and conduct a line-by-line audit to help determine whether civil charges should be filed, implying that Walpin’s probe had been insufficiently detailed.

– In March, 2009, a government consulting expert hired by the city of Sacramento concluded that Johnson’s continuing disbarment from receiving federal funds was likely to prevent the city from getting federal stimulus dollars — a finding Johnson quickly disputed.

– In April, the US Attorney’s office announced a settlement with Johnson, which would involve Johnson, St. HOPE, and the other official repaying over $400,000 in grants it received, and would allow him to again receive federal money.

– That same month, the new acting US attorney, Lawrence Brown wrote a letter to a federal oversight body for inspectors general, asking it to review Walpin’s work on the St. HOPE investigation. According to the AP, Brown wrote: “We also highlighted numerous questions and further investigation they needed to conduct, including the fact that they had not done an audit to establish how much AmeriCorps money was actually misspent.”

– Then in May, Walpin submitted a “Special Report to Congress” that called the settlement “a farce” and declared that claiming it was in the government’s interest “is an attempt to pull the wool over the public’s eyes.”

– And now we hear that Obama has decided to get rid of Walpin. In a letter to Sen. Charles Grassley (R-IA), White House Counsel Greg Craig referred to Brown’s letter criticizing Walpin, and wrote, according to the AP: “We are aware of the circumstances leading to that referral and of Mr. Walpin’s conduct throughout his tenure and can assure you that the president’s decision was carefully considered.”

So here’s what it sounds like: Johnson and his non-profit ran a very loose operation, which deserved some kind of sanction. But Walpin’s action — in publicly suggesting, without much apparent evidence, that Johnson might have committed a crime, and having Johnson barred from receiving federal funds, ultimately jeopardizing the fortunes of the city as a whole after Johnson became mayor — was out of all proportion to the wrongdoing. (That’s especially true given that it could have affected the outcome of a closely fought election — which is exactly why the FBI has specific policies forbidding public comments about ongoing investigations during political campaign season.) Then, even once the relevant authorities had determined that no crime had been committed and agreed on an appropriate remedy, Walpin worked to undermine that agreement by appealing to Congress.

The White House should probably offer some more specific details about its reasons for firing Walpin, beyond simply referring to Brown’s letter — a spokesman didn’t respond to our request for comment. That’s especially true given that Walpin had been skirmishing with an Obama ally, raising the specter of a politicized firing. But on its face, it seems like Obama may have had ample reason for making the decision he did.

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