Hearing offers little clarity to campaign disclosure proposal

By Jason Miller
Executive Editor
Federal News Radio

The White House put Dan Gordon in the unenviable position yesterday of trying not to answer questions about the draft Executive Order that has members on both sides of the aisle and vendors riled up.

Gordon, the administrator in the Office of Federal Procurement Policy, was the sacrificial lamb coming before concerned and sometimes frustrated lawmakers of the House Oversight and Government Reform and Small Business committees, who had many questions, but received few new details, about the draft Executive Order. The proposal, made public last month, would require contractors to publicly disclose political contributions to candidates or third parties they made over the past two years.

The proposal also would require vendors and their employees to report contributions that total more than $5,000 in any one given year. The draft order also would require all of this data to be published on Data.gov in a machine readable format.

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The draft order would put a section of the Disclose Act into regulations. The House passed the bill last session, but the Senate rejected it.

“There is now bipartisan alarm on Capitol Hill that the proposed Executive Order runs afoul of the government’s responsibility to keep federal procurement and contracting fair and unbiased,” said Oversight and Government Reform Committee Chairman Darrell Issa (R-Calif.). “If the President’s proposed Executive Order is authorized, political donation information would be readily available to political appointees who are immediately involved in the contracting process. That risk is unacceptable.”

Gordon made it clear from the beginning of the hearing he would not answer any questions about the draft order because it still was going through the normal review process. Throughout the hearing, Gordon said dozens of times he was not in the position to discuss the Executive Order or was not qualified to answer specific legal questions.

This led several Republican committee members to wonder why the White House even bothered to send him to testify before the committee.

Issa had requested Jacob Lew, the director of the Office of Management and Budget. Lew refused and Issa threatened a subpoena.

The committee and White House compromised on Gordon.

Gordon stuck close to his expertise, federal procurement.

While he didn’t offer too many new details into the status of the draft Executive Order, he did provide some insight into the administration’s thinking.

He said the administration has focused on integrity, accountability and transparency in the federal acquisition process, and this draft order was no different.

“Every procurement system, ours, the states’, the local governments’ and foreign ones are constantly facing a risk that the public will view their system as tainted,” he said. “Because the fact is enormous numbers of dollars of taxpayers’ funds are at risk in the procurement system and in order to instill confidence in the public, you want to have as much transparency as you can.”

He added that a recent international peer review by the Organisation for Economic Cooperation and Development found the federal government’s acquisition system received high marks from other countries for its integrity and competition.

Committee members didn’t disagree with the need for transparency, but the unintended consequences of adding politics to the procurement process was a bigger concern.

“Submitting this information ahead of the fact that you said yourself is information you don’t need to make determinations on a contract, what purpose does it serve?” asked Rep. Sam Graves (R-Mo.), Small Business Committee chairman. “How does knowing ahead of time who gave to what and how much they gave, how does that help in terms of transparency?”

Graves and others pointed out that campaign spending information already is available through the Federal Election Commission and other places.

Gordon said the government already requires vendors to disclose information to get contracts, including lobbying activities and the salaries of their top five highest paid executives and this requirement would be no different.

“We have a whole series of things which frankly can be quite burdensome for private companies and we are always looking for a balance,” he said. “These are often driven by statute. There are others that are not driven by statute. For example, organization conflict of interest is the requirement for disclosure is driven by regulation.”

Issa and Rep.Tim Walberg (R-Mich.) pressed Gordon on why it appears that unions are exempt from the draft order.

Gordon said the draft order would apply to any organization that receives a contract from the government so there are no specific exemptions.

Reps. Elijah Cummings (D-Md.) and Nydia Velazquez (D-N.Y.), ranking members of the Oversight and Government Reform and Small Business committees, respectively, drummed up support for the White House’s proposal.

Cumming said the arguments against the Executive Order don’t hold water. He said because companies and their executives already disclose campaign contributions, agency contracting officers could review that information at any time.

He also pointed out that the Supreme Court ruled that campaign disclosure rules don’t violate the First Amendment and have not had a “chilling effect” so far.

Cummings also said 30 open government groups and others wrote letters supporting the White House draft order.

But other Democrats, such as Rep. Gerry Connolly (Va.), said the draft order could result in unintended consequences.

He said disclosure of campaign contributions after or before the award of a contract could result in the perception there is a relationship between the agency and vendor when there is not.

Gordon said he understands the concern and doesn’t want transparency “rebounding against the intended goal.”

Issa’s frustration with Gordon’s lack of desire or ability to answer questions prompted him to ask whether the White House should even be treading into this area.

“You’ve basically said ‘You’re not comfortable, you don’t know, you’re not an expert’ repeatedly,” Issa said. “Isn’t that the best reason your part of government shouldn’t be reviewing or doing this? That in fact the Federal Election Commission which is charged with campaign disclosure and which is charged by congress is the appropriate way to handle this?”

Gordon said there may be others in the White House who are more knowledgeable about the specifics of the draft Executive Order.

That didn’t sit well with Issa.

“We asked for the person who was most knowledgeable in an agreement when the OMB director wasn’t available,” Issa said. “They sent you. We will undoubtedly have to ask for additional people who are more knowledgeable. It does appear as though in the questions of procurement, the only thing we decided today, it’s not necessary to do your job, your people will not look at it, but in fact we can see the draft order circumvents IRS laws that protect disclosure for non-profits and other groups that would fall under this.”

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