Department of Veterans Affairs a “Culture of Reckless Spending”

[DoD photo]

At a hearing on Wednesday on lavish conference spending at the Department of Veterans Affairs, John Sepulveda, former Assistant Secretary for Human Resources and Administration at the Department, asserted his fifth amendment privilege and refused to testify about two conferences held by the Department of Veterans Affairs in July 2011 and August 2011 in Orlando, Florida.

These two conferences, which were purportedly organized to train human resources professionals, cost taxpayers approximately $6.1 million.

Committee Chairman Darrell Issa, R-Calif., outlined the importance of Mr. Sepulveda’s testimony to the Committee’s year-long investigation into the conference.

“Mr. Sepulveda, today’s hearing will address the planning and execution of two Department of Veterans Affairs Conferences, held in Orlando, Florida in 2011. As the Assistant Secretary of Human Resources and Administration during the period in question you played a lead role in the conference planning process. You are uniquely qualified to assist the Committee in the investigation into the waste that may have occurred at this event,” said Chairman Issa. “Your name appears more than 80 times in the Inspector General’s report on the conference.”

Mr. Sepulveda refused to answer any question, including his current employment or retirement status. Accordingly, Chairman Issa dismissed him from the hearing.

The Committee also today released a staff report on the conferences, entitled “U.S. Department of Veterans Affairs 2011 Human Resources Conferences: A Culture of Reckless Spending.” The report is a product of the Committee’s year-long investigation of two conferences held by the Department of Veterans Affairs in July 2011 and August 2011 in Orlando, Florida.

“The Committee’s investigation has revealed that this massive price tag was the direct result of spending mismanagement, unethical behavior by federal employees, and irresponsible leadership,” the report states.

“The Department of Veterans Affairs core mission is to serve the nation’s veterans and their families. Congress considers the Department’s mission so important that we exempted it from sequestration and provided it an additional $300 million in the most recent spending bill,” said Committee Chairman Darrell Issa, R-Calif. “Despite this, the Department wasted millions on these conferences while wounded veterans have waited months to receive the help they deserve for their service to our Nation.”

The number of pending veteran benefit claims currently stands at 700,000, with more than half of veterans backlogged- meaning they are waiting over 125 days for their case to be resolved.

The Committee’s hearing, entitled “A Culture of Mismanagement and Wasteful Conference Spending at the Department of Veterans Affairs,” will take place today at 9:30 a.m. You can watch the live video of the hearing here.

Key Findings

· Department conference planners failed to create or maintain a budget for the HR conferences. They failed to create any mechanisms to restrain rapidly increasing expenditures.

· When the conference planners began to express concern about the source of funding for the conferences, one of [Dean of Veterans Affairs Learning University] Alice Muellerweiss’s deputies reassured the conference planners that they “don’t have a thing to worry about.”

· When pricing products and services for the conferences, the Department did not provide the vendors with price ranges, even when the vendors requested them.

· The Department never conducted a final accounting of costs for its conferences. In fact, the VA was even unable to provide a cost estimate 19 months after the conferences had ended.

· The Department actually provided a cap for the marketing budget, but it was a staggering $450,000. E-mails show that conference planners quickly lost sight of the objective of purchasing promotional items relating to employee training because of the large budget.

· The conference planners spent a lot of time and energy planning the kick-off event—often referred to as the “pep rally’’—for the conferences. In fact, as the scope of the kick-off event increased, some VA employees became worried that they no longer had sufficient time to handle their regular workloads in addition to conference planning duties.

· E-mails demonstrate that the VA conference planners treated the site visits to Dallas, Nashville, and Orlando more as vacations than work trips. They enjoyed helicopter rides and other perks from the hotels.

· The Department conference planners focused their energy on entertainment activities—such as DJ and karaoke nights and game nights—rather than employee training. Some of these planners then rewarded their own efforts during the conferences with massages, manicures and pedicures at the hotel spa, while getting paid.

· Some Department employees believed they should receive rewards for saving the Department money even though the budget for the VA conferences had spiraled out of control. Ultimately, the Department awarded over $43,000 in cash and time-off awards to the conference planners for a job “well done.”

· After critical articles in the Washington Post about federal agency conferences, the Department went on the defensive and developed talking points to protect its image.

· Although conference planners believed the Washington Post’s criticism was unfounded, the Department attempted to hide photos that took place of extracurricular activities at the VA conferences.

· Just a couple of months before the conferences were held, senior Department officials were surprised to learn that the conferences had become so expensive. Nevertheless, they made virtually no effort to curb costs.

· Despite Secretary Shinseki’s personal commitment to Chairman Issa, the Department has failed to cooperate with the Committee’s investigation. The Department missed a series of deadlines and only began producing many of the requested documents after the Chairman issued a subpoena.


  1. OK, What good are all these investigations and subpoena’s that are issued when there is no consequence for taking the 5th or even ignoring them. This administration has been the best one at stonewalling in all of US history. They have no shame nor conscience. Some need to be put in jail until they cooperate.

  2. ..and wounded and otherwise disabled veterans go without claims being settled, back payments being made, etc. etc. etc.

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