[House Hearing, 110 Congress]
[From the U.S. Government Publishing Office]



 
             INSPECTORS GENERAL: INDEPENDENCE AND INTEGRITY

=======================================================================

                                HEARING

                               before the

                 SUBCOMMITTEE ON GOVERNMENT MANAGEMENT,
                     ORGANIZATION, AND PROCUREMENT

                                 of the

                         COMMITTEE ON OVERSIGHT
                         AND GOVERNMENT REFORM

                        HOUSE OF REPRESENTATIVES

                       ONE HUNDRED TENTH CONGRESS

                             FIRST SESSION

                               __________

                             JUNE 20, 2007

                               __________

                           Serial No. 110-48

                               __________

Printed for the use of the Committee on Oversight and Government Reform


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              COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM

                 HENRY A. WAXMAN, California, Chairman
TOM LANTOS, California               TOM DAVIS, Virginia
EDOLPHUS TOWNS, New York             DAN BURTON, Indiana
PAUL E. KANJORSKI, Pennsylvania      CHRISTOPHER SHAYS, Connecticut
CAROLYN B. MALONEY, New York         JOHN M. McHUGH, New York
ELIJAH E. CUMMINGS, Maryland         JOHN L. MICA, Florida
DENNIS J. KUCINICH, Ohio             MARK E. SOUDER, Indiana
DANNY K. DAVIS, Illinois             TODD RUSSELL PLATTS, Pennsylvania
JOHN F. TIERNEY, Massachusetts       CHRIS CANNON, Utah
WM. LACY CLAY, Missouri              JOHN J. DUNCAN, Jr., Tennessee
DIANE E. WATSON, California          MICHAEL R. TURNER, Ohio
STEPHEN F. LYNCH, Massachusetts      DARRELL E. ISSA, California
BRIAN HIGGINS, New York              KENNY MARCHANT, Texas
JOHN A. YARMUTH, Kentucky            LYNN A. WESTMORELAND, Georgia
BRUCE L. BRALEY, Iowa                PATRICK T. McHENRY, North Carolina
ELEANOR HOLMES NORTON, District of   VIRGINIA FOXX, North Carolina
    Columbia                         BRIAN P. BILBRAY, California
BETTY McCOLLUM, Minnesota            BILL SALI, Idaho
JIM COOPER, Tennessee                JIM JORDAN, Ohio
CHRIS VAN HOLLEN, Maryland
PAUL W. HODES, New Hampshire
CHRISTOPHER S. MURPHY, Connecticut
JOHN P. SARBANES, Maryland
PETER WELCH, Vermont

                     Phil Schiliro, Chief of Staff
                      Phil Barnett, Staff Director
                       Earley Green, Chief Clerk
                  David Marin, Minority Staff Director

  Subcommittee on Government Management, Organization, and Procurement

                   EDOLPHUS TOWNS, New York, Chairman
PAUL E. KANJORSKI, Pennsylvania      BRIAN P. BILBRAY, California
CHRISTOPHER S. MURPHY, Connecticut   TODD RUSSELL PLATTS, Pennsylvania,
PETER WELCH, Vermont                 JOHN J. DUNCAN, Jr., Tennessee
CAROLYN B. MALONEY, New York
                    Michael McCarthy, Staff Director


                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on June 20, 2007....................................     1
Statement of:
    Hill, Eleanor J., former Inspector General, U.S. Department 
      of Defense; Kenneth M. Mead, former Inspector General, U.S. 
      Department of Transportation; Nikki L. Tinsley, former 
      Inspector General, Environmental Protection Agency; Jeffrey 
      C. Steinhoff, Managing Director, Financial Management and 
      Assurance, Government Accountability Office; and Vanessa 
      Burrows, Legislative Attorney, Congressional Research 
      Service, accompanied by Fred M. Kaiser, Specialist in 
      American National Government, Congressional Research 
      Service....................................................    48
        Burrows, Vanessa, and Fred M. Kaiser.....................    97
        Hill, Eleanor J..........................................    48
        Mead, Kenneth M..........................................    62
        Steinhoff, Jeffrey C.....................................    76
        Tinsley, Nikki L.........................................    71
    Johnson, Clay, Deputy Director for Management, Office of 
      Management and Budget, Executive Office of the President, 
      and Chair, President's Council on Integrity and Efficiency 
      and Executive Council on Integrity and Efficiency; Phyllis 
      K. Fong, Inspector General, U.S. Department of Agriculture, 
      and Chair, Legislation Committee, President's Council on 
      Integrity and Efficiency; and Christine C. Boesz, Inspector 
      General, National Science Foundation, and Vice Chair, 
      Executive Council on Integrity and Efficiency..............    16
        Boesz, Christine C.......................................    30
        Fong, Phyllis K..........................................    22
        Johnson, Clay............................................    16
Letters, statements, etc., submitted for the record by:
    Boesz, Christine C., Inspector General, National Science 
      Foundation, and Vice Chair, Executive Council on Integrity 
      and Efficiency, prepared statement of......................    32
    Burrows, Vanessa, Legislative Attorney, Congressional 
      Research Service, and Fred M. Kaiser, Specialist in 
      American National Government, Congressional Research 
      Service, prepared statement of.............................    99
    Davis, Hon. Tom, a Representative in Congress from the State 
      of Virginia, prepared statement of.........................   121
    Fong, Phyllis K., Inspector General, U.S. Department of 
      Agriculture, and Chair, Legislation Committee, President's 
      Council on Integrity and Efficiency, prepared statement of.    23
    Hill, Eleanor J., former Inspector General, U.S. Department 
      of Defense, prepared statement of..........................    52
    Johnson, Clay, Deputy Director for Management, Office of 
      Management and Budget, Executive Office of the President, 
      and Chair, President's Council on Integrity and Efficiency 
      and Executive Council on Integrity and Efficiency, prepared 
      statement of...............................................    19
    Mead, Kenneth M., former Inspector General, U.S. Department 
      of Transportation, prepared statement of...................    65
    Miller, Hon. Brad, a Representative in Congress from the 
      State of North Carolina, prepared statement of.............     7
    Steinhoff, Jeffrey C., Managing Director, Financial 
      Management and Assurance, Government Accountability Office, 
      prepared statement of......................................    78
    Tinsley, Nikki L., former Inspector General, Environmental 
      Protection Agency, prepared statement of...................    73


             INSPECTORS GENERAL: INDEPENDENCE AND INTEGRITY

                              ----------                              


                        WEDNESDAY, JUNE 20, 2007

                  House of Representatives,
            Subcommittee on Government Management, 
                     Organization, and Procurement,
              Committee on Oversight and Government Reform,
                                                    Washington, DC.
    The subcommittee met, pursuant to notice, at 2:05 p.m., in 
room 2247, Rayburn House Office Building, Hon. Edolphus Towns 
(chairman of the subcommittee) presiding.
    Present: Representatives Towns, Maloney, Davis of Virginia, 
Duncan, and Bilbray.
    Also present: Representatives Cooper and Miller.
    Staff present: Michael McCarthy, staff director; Velvet 
Johnson, counsel; Cecelia Morton, clerk; Alex Cooper, minority 
professional staff member; Larry Brady, minority senior 
investigator and policy advisor; and Patrick Lyden, minority 
parliamentarian and member services coordinator.
    Mr. Towns. The subcommittee will come to order.
    Today's hearing is on the important role of the Inspector 
General in providing independent oversight within Federal 
agencies by investigating and reporting waste, fraud, and abuse 
to both agency leaders and to the Congress. Inspectors General 
play a critical role in maintaining checks and balances in the 
Federal Government. When Congress created the Inspector General 
nearly 30 years ago, the idea was that having an independent 
official inside the Federal agencies would help detect and 
prevent wasteful spending and mismanagement. This concept has 
been a tremendous success.
    Investigations by IGs have resulted in the recovery of 
billions of dollars from companies and individuals who 
defrauded the Federal Government. These investigations have led 
to thousands of criminal prosecutions, debarments, exclusions, 
and suspensions. In 2006, alone, audits by IG offices resulted 
in $9.9 billion in potential savings from audit recommendations 
and $6.8 billion in investigative recoveries.
    In sum, the IG work to ferret out criminal and abusive 
action in Government has gone a long way to create the clean 
and efficient Government the taxpaying public expects and 
deserves.
    Of course, even the best system needs some improvement from 
time to time, and that is why we are here today. To effectively 
carry out their mission, Inspectors General must be independent 
and objective, which requires that they be insulated from 
improper management and political pressure.
    To preserve the credibility of the office, Inspectors 
General must also perform their duties with integrity and apply 
the same standards of conduct and accountability to themselves 
as they apply to the agencies that they audit and investigate.
    In recent years there have been several episodes which 
raised questions about the independence and accountability of 
the IGs. We have compiled a report for the record that 
documents some of these episodes, many of which have been in 
the press recently. Today, we want to look at some of the 
common problems that these cases identify and how we can fix 
them.
    Does lack of input into budget decisions threaten the 
independence of IGs? Is there a consistent and credible process 
for investigating allegations of wrongdoing against IGs? What 
is the proper relationship between the head of a Federal agency 
and the Inspector General? These are the types of questions 
today's hearing will address.
    I believe there are legislative changes we can make that 
will improve the institutional standing of the Inspector 
General and better guarantee their independence and 
accountability. My colleague from Tennessee, Representative Jim 
Cooper--who came to Congress with me and then left and came 
back, is back with us again--has introduced H.R. 928, the 
Improving Government Accountability Office Act, to do just 
that. There is a bill in the Senate that fixes some of the pay 
disparities that career employees face if they are appointed as 
IGs. My friend from New York City, Mrs. Maloney, has introduced 
H.R. 2527, which would streamline IG operations at the IRS.
    I welcome all of these witnesses. We have assembled a group 
of current and former IGs and a senior administration leader on 
IG issues, and experts from GAO and the Library of Congress. 
The goal today is to get your input on these issues and these 
bills.
    I always say that we need good input in order to get great 
output. The output will be a strong bill that will help IGs 
maintain their role as honest brokers and continue the valuable 
work that they do for Congress and the taxpayers.
    I ask unanimous consent that the gentleman from Tennessee, 
Mr. Cooper, and the gentleman from North Carolina, Mr. Miller, 
participate in today's hearing. Mr. Cooper, of course, is a 
member of the full committee, but not this subcommittee. Mr. 
Miller is the Chair of the Science and Technology subcommittee 
that oversees NASA, and recently held a hearing on the 
Inspector General's office there.
    I also ask unanimous consent that all Members have 5 
legislative days to submit opening statements for the record. 
Without objection, so ordered.
    I recognize now the ranking member of this subcommittee 
from the great State of California, Mr. Bilbray, for his 
opening statement.
    Mr. Bilbray. Thank you, Mr. Chairman.
    I appreciate the chance to be able to discuss this subject. 
Let's face it, the IG in no little ways are sort of Congress' 
eye in the sky. Our ability to actually perceive what is going 
on or what is not going on properly is very important.
    I would just like to say to my colleague from Tennessee, 
like myself, a newly recycled Member of Congress, the fact is 
that this hearing will give us the ability to review 
opportunities and challenges, see how H.R. 928, as drafted, 
will help, maybe be able to find some ways that maybe it can be 
improved and we can move forward, but I think the real issue 
here is, regardless of your party affiliation, I think we have 
had concerns about the ability of the IG to do their work 
appropriately and effectively.
    I know that in the previous administration, during my other 
life in Congress, there were major concerns. I am sure that the 
same concerns exist today with the new administration. 
Hopefully with this hearing we will be able to identify exactly 
what needs to be done from a legislative point of view to get 
back on track with the intention that Congress move forward 
with the IG 30 years ago.
    I think outcome is what really matters here. In the 
reality, the standards that we set for the IG in either H.R. 
928 or in the other legislation we may do this year or next 
year will not be one that just affects a Republican 
administration. It will affect every administration for the 
next decade or two decades. I think that is the standard we 
really need to shoot for. Hopefully, we will be able to work 
together, understanding that this legislation and this 
oversight is a service to the American people, and that matters 
most.
    With that, Mr. Chairman, I yield back.
    Mr. Towns. Thank you very much.
    Any other opening statements?
    Mr. Cooper. Mr. Chairman.
    Mr. Towns. Mr. Cooper.
    Mr. Cooper. If I could just thank you for your kindness in 
holding this hearing, not only on these important issues, 
because IGs, as the gentlemen from New York and California have 
just stated, are one of the most important parts of Government, 
but also I appreciate your including my bill, H.R. 928. I look 
forward to the expert testimony from the witnesses.
    Thank you, Mr. Chairman.
    Mr. Towns. Thank you.
    Yes, Mr. Miller?
    Mr. Miller. I would like a chance to speak just briefly on 
the nature of my interest as chairman of the Investigations and 
Oversight Subcommittee of the Science and Technology Committee.
    Mr. Towns. The gentleman is recognized.
    Mr. Miller. I agree with Mr. Bilbray that Inspectors 
General play an important role for Congress in being our eyes 
and ears throughout the executive branch of Government so that 
we can perform our functions of oversight, we can know what is 
going on, whether there is misconduct or whether there is 
simply a way to run Government better. Inspectors General are 
an important part of that.
    The Inspector General Act of 1978 required that Inspectors 
General be selected without regard to political affiliation and 
solely on the basis of integrity and demonstrated ability in 
accounting, auditing, financial analysis, law, management, 
management analysis, public administration, and investigations. 
They are nominated by the President, they are confirmed by the 
Senate.
    The Inspectors General have sweeping powers to look at what 
is going on in agencies, and they are to report to us, to 
Congress, as well as to the agency head. They can be removed by 
the President, but in any removal the reasons for removal have 
to be reported to both houses of Congress. And, in practice, 
over the 30 years that we have had the Inspectors General Act, 
many Inspectors General are career IGs, they have served in 
several administrations, they often have served in more than 
one agency.
    We expect them to be impartial, objective, and, above all, 
independent. Any Inspector General worth his salt must be 
willing to make enemies of powerful people to do his job right. 
As a result, the efforts, as Mr. Bilbray pointed out, are very 
dedicated Inspectors General.
    We have held the executive branch of Government accountable 
to Congress and to the American people. Ideally, any 
administration should welcome the role of Inspector General in 
helping them manage the Federal Government, but we have seen an 
effort to resist any accountability, whether by Congress, the 
courts, or by Inspectors General. Unfortunately, the 
appointment of Inspectors General has been both politicized and 
dumbed down. The Inspectors General often have not met any 
professional standards and have not seen themselves as 
independent watchdogs, but they have seen themselves as part of 
the management team of the agency.
    Mr. Johnson, one of the witnesses today, will testify that 
Inspectors General are selected or fired or selected by the 
agency head. That is not how an independent Inspector General 
should operate, and the result has been Inspectors General just 
do not--or at least some--understand their proper role. It has 
created enormous turmoil in their offices with their 
professional staff who do know what the proper role is and are 
very frustrated to see appointed Inspectors General is more 
interested in protecting the agencies from embarrassment than 
they are in calling the agency out and holding them accountable 
when need be.
    We have specifically investigated the Inspector General of 
NASA, Moose Cobb. He was personally selected for the position 
by NASA's former administrator, Sean O'Keefe, who decided he 
did not like the previous Inspector General, the one that he 
inherited when he became the administrator of NASA. He had his 
chief of staff interview Mr. Cobb, who at that time was working 
in the White House Counsel's office reporting to Alberto 
Gonzales. Mr. Cobb had no apparent experience in auditing and 
financial management and public administration, accounting, 
investigations in aeronautics, or any other area that was 
pertinent to his service as Inspector General of NASA, nor had 
he ever managed an office.
    Once at NASA, he was everyone's worst nightmare of a boss. 
He was a tyrant to his own staff, and he was a sycophant to Mr. 
O'Keefe and to the top management at NASA. He was openly 
contemptuous of career NASA IG employees. He called them 
bureaons. That was his shorthand for bureaucratic morons.
    Mr. Chairman, I think most Americans, including me, have 
widely admired, have admired NASA's employees as the right 
stuff people. It was NASA's employees who put Americans on the 
moon. It was NASA's employees who got Apollo 13 crew safely 
back to Earth. But Mr. Cobb at NASA preferred the company of 
the political appointees over that of his own staff or other 
NASA employees. He frequently had lunch in the NASA cafeteria 
with Mr. O'Keefe, with Mr. O'Keefe's chief of staff, the NASA 
General Counsel--in other words, the political appointees. He 
played golf, he had drinks with them, he called Mr. O'Keefe his 
boss and worried that Mr. O'Keefe could fire him, as Mr. 
O'Keefe had, in fact, fired his predecessor.
    No NASA employee thinking of blowing the whistle on 
anything that they saw happening at NASA would feel confident 
that they could get to Mr. Cobb, tell him what was going on, 
and believe that he would respect their confidentiality and use 
the information that employee provided in the proper way.
    Mr. Cobb mistrusted and routinely berated his own staff. He 
discussed audits and investigations with Mr. O'Keefe and the 
other management at NASA. He halted or edited audit findings to 
suit NASA management. Experienced staff left in droves and 
productivity cratered.
    The President's Council on Integrity and Management 
initially ignored employee complaints, but by 2006 the 
complaints had reached a critical mass and they began an 
investigation that took several months, and the Council found 
that Mr. Cobb had abused his authority, that he had shown a 
lack of independence from NASA officials, and said that 
discipline up to and including removal should be imposed.
    But the decision on what to do about Mr. Cobb was turned 
over to the new administrator of NASA, creating another 
appearance of a lack of independence, and now, even after 
congressional hearings when it was very apparent that all of 
the congressional leadership with oversight of NASA, committees 
with oversight of NASA, have called upon the removal of Mr. 
Cobb, Mr. Cobb remains in position. We cannot turn to the NASA 
Inspector General to be our eyes and ears in that agency.
    Mr. Chairman, the Inspector General Act was intended to 
make our Government accountable to the American people. 
Instead, Mr. Cobb at NASA, and perhaps others, have used their 
positions as Inspectors General to shield the Bush 
administration from political embarrassment instead of being an 
independent watchdog, instead of holding that agency or other 
agencies accountable to Congress and to the American people.
    An Inspector General is not going to act as a tough, 
independent watchdog if they are hired, fired, and disciplined 
by the agency head, and Inspectors General have to be selected 
for their professional qualifications, not their political 
loyalty.
    In the early years of the Inspector General Act, a 
committee of Inspectors General reviewed the prospective 
Inspectors General for their qualifications. Mr. Cobb almost 
certainly would not have survived a review like that. Why 
should that practice not be instituted again?
    Something here has to give. I have some reservation about 
Mr. Cooper's bill, the legislation, but I certainly applaud him 
for raising this issue and beginning what I think needs to be a 
debate within Congress.
    I look forward to working, Mr. Chairman, with you and with 
your subcommittee and staff on legislation.
    Mr. Chairman, I will present later, if the Chair allows, a 
more detailed analysis of Mr. Cooper's proposed legislation.
    [The prepared statement of Hon. Brad Miller follows:]

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    Mr. Towns. Let me just thank all of you for your opening 
statements. I think that we do have one thing in common: we all 
feel that something needs to happen in a positive way in order 
to move forward. I think we all agree on that. As exactly what 
it is, we may not agree on that, but I think that is the reason 
why we have these hearings, that is the reason why we bring the 
experts in to talk to us, so that we can come up with a way and 
method to be able to try and resolve it.
    I want to thank you again for your opening statements.
    Let me say this: it is a longstanding policy of this 
committee that we swear our witnesses in.
    [Witnesses sworn.]
    Mr. Towns. Let the record reflect that they all answered in 
the affirmative.
    Let me introduce the panel.
    Clay Johnson is the Deputy Director for Management at the 
Office of Management and Budget. He served as Chair of the 
President's Executive Council on Integrity and Efficiency, the 
coordinating body for Federal Inspectors General.
    Phyllis Fong has served as the Inspector General for the 
Department of Agriculture since December 2002. Prior to that 
she was the IG at the Small Business Administration. Her career 
in Executive-level positions in the Federal Inspector General 
community spans 19 years. She looks young, but she has been 
around. Ms. Fong is Chair of the Legislation Committee of the 
PCIE.
    Christine Boesz assumed the duty of Inspector General of 
the National Science Foundation in January 2000. She represents 
agency-appointed IGs as the Vice Chair of the Executive Council 
for Integrity and Efficiency.
    Your entire statement is in the record, and I ask that each 
of you summarize within 5 minutes. The yellow light means your 
time is almost up, and the red light means your time is up.
    I would like to start with you, Mr. Johnson. Will you 
proceed?

  STATEMENTS OF CLAY JOHNSON, DEPUTY DIRECTOR FOR MANAGEMENT, 
   OFFICE OF MANAGEMENT AND BUDGET, EXECUTIVE OFFICE OF THE 
  PRESIDENT, AND CHAIR, PRESIDENT'S COUNCIL ON INTEGRITY AND 
 EFFICIENCY AND EXECUTIVE COUNCIL ON INTEGRITY AND EFFICIENCY; 
    PHYLLIS K. FONG, INSPECTOR GENERAL, U.S. DEPARTMENT OF 
  AGRICULTURE, AND CHAIR, LEGISLATION COMMITTEE, PRESIDENT'S 
 COUNCIL ON INTEGRITY AND EFFICIENCY; AND CHRISTINE C. BOESZ, 
INSPECTOR GENERAL, NATIONAL SCIENCE FOUNDATION, AND VICE CHAIR, 
         EXECUTIVE COUNCIL ON INTEGRITY AND EFFICIENCY

                   STATEMENT OF CLAY JOHNSON

    Mr. Johnson. Mr. Chairman, Ranking Member Bilbray, Mr. 
Cooper, and Mr. Miller, thank you for having me here.
    After those opening comments, I can tell this hearing is 
going to be a little bit more interesting than I thought, 
because, Mr. Miller, you have not only brought into question my 
oversight of the Inspector General community, you have brought 
into question my performance as the head of Presidential 
personnel for 2 years. I can tell you your assertion about how 
IGs, how any political appointee, is selected is totally wrong, 
so I look forward to the conversation here and whenever else 
you want to continue it.
    The comment was made that IGs are Congress' eye in the sky. 
More importantly, first of all, you have your own eye in the 
sky, GAO. More importantly, I believe, than your eye in the 
sky, the IGs are the executive branch's eye in the sky.
    Federal agency leadership wants their agencies to work 
really well. No head of any agency or department wants their 
agency to perform poorly, so IGs are critical in an agency 
head's ability for their agency to perform well. IGs identify 
things that need to be fixed. Oversight, transparency 
identifies things that need to be fixed. So IGs and agency 
heads share the same goal: they are to work together. It is not 
true, as some Members of Congress have suggested, that IGs are 
best when they are junkyard dogs and they are the avowed enemy 
of the agency head.
    I don't know of any highly functioning, effective IG in the 
Federal Government, past or present, who has that modus 
operandi that is an effective IG. I have issued in my written 
remarks the one-page document that the IG leadership and I 
developed in 2004, which is our view of the proper relationship 
that an agency head and an IG ought to have. There is no 
junkyard dog or enemy component in that.
    I do not believe the assertion that the IGs have been 
dumbed down. I agree totally with Chairman Towns that the 
volume and the quality of the work done by IGs today is superb. 
It is outstanding, by any measure, and it is as high as it has 
ever been.
    I have heard, with all the assertions about how independent 
or dependent IGs are, I have never heard any reference to 
result to a quantification of their performance that suggests 
that the quality or quantity of the IG's work is any less than 
it has been or is anything short of what it can be.
    I believe that a lot of the assertions that the IG 
community needs to be fixed are based on philosophical 
sentiments as opposed to any kind of tangible evidence that 
there is a real problem to be fixed.
    I think it is very important to recognize that IGs and 
agency heads share the same goal. They want the agencies to 
work; therefore, they are to work together. They are not to 
work in opposition to cause their agencies to work effectively 
together. But it is also very important that IGs be very 
independent. What is supposed to be independent is their 
findings. Their findings are supposed to be based entirely on 
the facts, not on any kind of political persuasion.
    I think it is very important also to recognize that the 
proper relationship to be achieved by an agency head and an IG 
is something that needs to be worked at on a daily basis. It is 
not something that is legislated or created by fiat.
    I also believe it is important to recognize that IGs do 
need to be held accountable for the quantity and quality of 
their work. As a result of these feelings, I believe the 
following: I believe that setting terms for IGs and specific 
reasons for dismissal are bad ideas. It is measures such as 
these that work against an IG being held accountable for the 
quality and quantity of their work.
    I believe, as a result of what I just stated, I believe it 
is important that budget requests from an IG not be separate 
from the agency submission. I do believe it needs to be clear 
in the agency's submission what amount is being requested for 
the IG and how that compares to past performance, but I do not 
believe it needs to be separate, because it works against the 
agency head and the IG working together for the success of the 
agency.
    I believe it is very important to fix IG pay. There are 
parts about IG pay that do not work. In fact, a lot of them are 
SES, and SES can only get raises if they are evaluated, but who 
can evaluate an IG is a real problem.
    I am not sure that your bill, Mr. Cooper, is the answer. I 
don't know what it is, but I look forward to working with you 
on that and other aspects of it.
    Finally, I believe it is very important that the Integrity 
Committee process be reviewed. I think there are some rights 
that IGs have that they don't need and have that they don't 
have in that process, and we need to make sure that is the best 
investigation process that it can be, because is it a very 
important process.
    With those remarks, I look forward to your questions after 
the other opening remarks.
    Thank you.
    [The prepared statement of Mr. Johnson follows:]
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    Mr. Towns. Thank you very much, Mr. Johnson.
    Ms. Fong.

                  STATEMENT OF PHYLLIS K. FONG

    Ms. Fong. Thank you, Mr. Chairman, Ranking Member Bilbray, 
Mr. Cooper, and Mr. Miller. I am very, very pleased to be here 
today to talk about the issues of accountability, independence, 
and the Cooper bill.
    As you mentioned in your very kind introduction of me, I 
have been privileged to have received an appointment from both 
President Bush and President Clinton, and truly am what I 
consider to be a career IG employee.
    In addition to my service as an IG, as you mentioned, I am 
the Chair of the PCIE Legislation Committee, and I should just 
note that the committee's job is to serve as the community's 
liaison with Congress on issues dealing with legislation. What 
we try to do in the committee is to build consensus, to the 
extent that we can, on issues that affect the IG community, as 
a whole.
    Now, that is not always possible because different IGs have 
different experiences and situations, and so unanimity may not 
always be possible, but I will say that, with respect to the 
Cooper bill, there is widespread support in the community for 
many, many of the provisions in the bill, and we are very, very 
grateful to Mr. Cooper for working with us over these years to 
get this legislation developed.
    As you requested, my testimony today will focus on issues 
of independence and accountability. We believe several of the 
bill's provisions are very effective at addressing these 
issues. In particular, the provision in the bill that would 
codify a council of the IGs, we believe that would enhance 
independence and coordination within the community. It would 
also codify the workings of the Integrity Committee, which we 
believe to be a very important byproduct.
    In addition, the bill contains provisions regarding terms 
of office and removal for cause, which we believe strikes 
directly to the heart of independence of IGs, and also would 
deal with certain pay issues for the DFE IGs.
    So, in closing, on behalf of the Legislation Committee, I 
would like to express my very deep appreciation to all of you 
for your work on this, and we look forward to answering your 
questions.
    [The prepared statement of Ms. Fong follows:]
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    Mr. Towns. Thank you very much, Ms. Fong.
    Dr. Boesz.

                STATEMENT OF CHRISTINE C. BOESZ

    Ms. Boesz. Thank you, Mr. Chairman and Ranking Member 
Bilbray and Mr. Cooper and Mr. Miller. I am delighted to be 
here today.
    As you mentioned in my introduction, I not only am an IG 
but also serve as the Chair of the ECIE, and I wanted to be 
sure that you understand that this is a group of 33 agencies 
with very diverse missions and operations. Some have very high 
public profiles, and some are smaller but still very important 
agencies.
    Although I believe my views are shared by many of the ECIE 
IGs, today I will speak for myself and will indicate where I 
think there is broader support.
    My testimony focuses on the provisions of H.R. 928. I offer 
the following observations: First, H.R. 928 proposes to 
establish 7 year terms for all IGs and the specific causes that 
would lead for removal of an IG. It is unclear to me whether 
this proposal would enhance ID independence or instead produce 
unintended consequences. Because ECIE IGs are generally career 
Federal employees who serve in positions with Civil Service 
status and corresponding protections, one unintended 
consequence may be that strong candidates for IG positions 
would be dissuaded from exchanging a permanent position for a 
term appointment.
    ECIE IGs are also subject for removal for cause currently. 
The 10-year removal of any IG are sensitive matters, and any 
changes to the law need to be carefully considered to avoid 
impairing the current IG roles or making it undesirable for 
those who should serve as IGs.
    In short, on this matter the devil is in the details.
    The proposal to authorize IGs to submit budgets directly to 
OMB is needed. It removes the risk of an agency inappropriately 
influencing an IG and it provides transparency to the budget 
process. I and a majority of the ECIE IGs support this.
    The proposal for a unified IG council that has its own 
appropriation is also desirable. We support it because we 
believe it would help with our training.
    The proposal to require that IGs be classified for pay and 
other purposes at the same level as other senior staff 
reporting directly to the agency head is critical within the 
ECIE community. In a recent survey, we found that some ECIE IGs 
had a lower grade level than other direct report executives and 
are sometimes paid less. Not surprisingly, the ECIE IGs 
strongly support pay parity and equity for all IGs.
    H.R. 928 also would allow for ECIE IGs to apply to the 
Department of Justice for law enforcement authority, ending the 
inefficient process of reviewing such authority on a case-by-
case basis. I and the other ECIE IG strongly support this 
provision.
    Finally, I would mention that H.R. 928 would amend the 
Program Fraud Civil Remedy Act to include the ECIE IGs and 
agencies, thereby providing an effective tool to address claims 
with dollar amounts less than $150,000. This amendment has been 
a high priority for the ECIE agencies and IGs for many years 
now.
    I also want to note that within the ECIE we have three 
legislative branch IGs. Their circumstances are a little bit 
different, and they mentioned to me that they would like to 
speak directly to you about their specific issues.
    Mr. Chairman, this concludes my testimony. I again thank 
you and the members of the subcommittee for conducting this 
hearing and giving your time and attention to these very, very 
important matters.
    [The prepared statement of Ms. Boesz follows:]
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    Mr. Towns. Thank you very much.
    Let me thank all of you for your testimonies.
    Let me begin with you, Ms. Fong. What is it in the Cooper 
bill that you dislike?
    Ms. Fong. Well, we have looked at the bill. As I mentioned, 
it is not always easy to have a unanimous view in the IG 
community, and so on a number of provisions there are different 
views as to whether the provision is the best that it could be. 
Certainly, one of the issues that has come up has been a issue 
of IG pay. The Cooper bill is very good at addressing the DFE 
IG situation, does not address the PAS IG situation, so we 
would want to work with the committee on that provision.
    There may also be a few technical amendments that we would 
want to offer with respect to some of the language. I think Dr. 
Boesz has raised a very good issue about the legislative branch 
IGs, as well. That needs to be considered.
    Mr. Towns. Thank you. Thank you very much.
    Mr. Johnson, you know, there is criticism out there, the 
same as with the education system. They are saying that you 
have a principal of the school and a lot of bad things are 
going on in the school, and the principal will not report it 
because it makes him look like he is a bad principal. So when 
it comes to the IG, you know, and agency, many people are 
saying that is what is going on, that there is this cozy 
relationship, that the IG does not, you know, report everything 
because it also makes the agency, itself, look bad.
    What are your views? Is this accurate?
    Mr. Johnson. No, sir, I don't believe that it is accurate 
at all. I believe that, in fact, there is more transparency 
about what doesn't work in the Federal Government today than 
there ever has been before. First of all, the numbers produced 
by the IG efforts are as strong and as positive and as 
professionally done as has ever been the case. There is more 
information now prompted by and developed by this 
administration, as long as we are talking about this 
administration, about what programs work and don't work in the 
Federal Government.
    There is more information about what Federal property we 
need and don't need. There is more information about where our 
payments are proper and improper and what we are doing to fix 
them. There is more information about what management practices 
we have in what agencies and where we are deficient in our 
ability to be good stewards of the taxpayers' money. So there 
is more information, there is more public declaration today 
than ever before, including as a result of the IGs work, on 
what doesn't work, what does work, and what we need to be doing 
to make everything work better.
    So I believe that there is no indication that there is any 
kind of pressure to hide what doesn't work. I think it is just 
the opposite. There has been more effort to declare what 
doesn't work so there can be more pressure, starting with 
Congress, more pressure exerted by Congress on the executive 
branch to cause things to work better.
    We have over 1,000 programs in the Federal Government, and 
yet there is very little pressure from Congress to cause those 
programs to work better. There is a tremendous amount of 
attention paid to what the policy ought to be and how much 
money ought to be spent, but there is very little attention--
and this is not only my opinion, this is the opinion of David 
Walker and former Chairman Dick Armey--that the executive 
branch is significantly more focused on program performance 
than the congressional branch, legislative branch.
    And so I think there is more attention than ever before on 
how things work and how to make it work better, and so I just 
don't agree with the premise at all that there is an effort to 
hide things that don't work. It is just the opposite.
    Mr. Towns. All right. Let me just go right down the line. 
How do you feel about performance evaluation in terms of tying 
pay to performance evaluations? Let me go right down the line, 
starting with you, Dr. Boesz, and come right down the line.
    Ms. Boesz. Tying performance of the IG?
    Mr. Towns. Yes.
    Ms. Boesz. Well, my situation, my performance, I do get a 
review based on the performance of the office, and it rolls up. 
We have a strategic plan, and it rolls up all the way from the 
auditors up through management to me to the National Science 
Board, who I work for, and so we are evaluated and expected to 
meet certain kinds of criteria. Now, we set them, but we also 
then meet them. So we don't think it is a bad concept.
    Mr. Towns. Ms. Fong.
    Ms. Fong. As a PAS IG we have a slightly different 
situation. In principle, I support performance-based pay. I 
think it is very important to hold people accountable, and 
certainly within our organization we hold our employees 
accountable for meeting their goals and objectives. When it 
comes to IGs, we get into a little more complex situation, 
because the question is who would make the decision as to 
whether an IG is doing a good job, and the issue of 
independence and potential conflicts of interest.
    If the agency head is the one who appraises the IG, there 
could be a challenge to whether that appraisal is impartial or 
justified. There could be charges that the IG either did or 
didn't do work in order to get a good rating or a bonus or 
whatever, and so that raises some very difficult issues for IGs 
who are Presidential appointees.
    At this stage of the game, as a PAS IG I am not rated or 
appraised. I am accountable for the performance of my office 
and ultimately accountable to the President.
    Mr. Towns. All right.
    Mr. Johnson.
    Mr. Johnson. I think there are two parts about performance 
evaluation. One, giving whoever is being reviewed feedback 
about how they are doing can be helpful to them to learn how to 
be better. I think it is very difficult to have that feedback 
come from the head of the agency, as has been suggested. But I 
would look forward to working with the IGs to figure out how 
they can get feedback from peers or some other means to help 
them continually improve their performance.
    I think, therefore, it makes it very hard for an SES to get 
pay increases based on performance evaluation, as is the case 
with SESers, because there is no one to do a performance 
evaluation without violating this independence issue, so we 
have to fix that.
    It has been suggested that the raises be the average of the 
raises given to everybody. I don't know what it is, but we need 
to fix that, because it is not fair, it is not right, and it is 
a big part of the issues raised by Mr. Cooper that I think need 
to be addressed in some piece of legislation.
    Mr. Towns. Right. Thank you very much.
    I yield to Mr. Cooper.
    Mr. Cooper. Thank you so much, Mr. Chairman. Again, I 
appreciate your holding this hearing. All we are trying to do 
is make Government work, regardless of the administration. 
There should be no politics in this bill. We are just trying to 
get value for taxpayer dollars.
    I appreciate the testimony of each of the witnesses. I 
don't want to dwell on the negative and I don't want to be 
simplistic and dwell on the positive, either, but one of the 
complaints has been that people are uncertain about dealing 
with a fixed term for the IG. That would be a new experience 
for many of the IGs, not all. How would that mesh with 
administrations? What term do you pick for a term of office? Of 
course, IGs could be reappointed and only removed under defined 
circumstances, but I think we all share the same goals. It is a 
question of the best way to reach that goal.
    An alternative proposal has been to not have a fixed term 
of office, but to have a 30 day advance notice to Congress in 
the event that an IG is dismissed. Of course, that gets tricky 
meshing with the congressional calendar. Is that 30 legislative 
days? Sometimes we are not here during August or major 
holidays. Every proposal has its own flaws, but I am curious. 
Would that sit better with OMB or with the two different 
varieties of IGs than a fixed term in office?
    Mr. Johnson. Yes. I, myself, I would recommend that the 
administration oppose a term. Of course, the President doesn't 
want any restrictions on his ability to appoint. That is just a 
generic statement. But I think a term and specific reasons 
limit the ability to hold an IG accountable.
    For instance, Mr. Miller, you were talking about Moose 
Cobb. None of the things that you have accused Moose of or 
Moose has been accused of are on this list, which is kind of an 
interesting, ironic thing. But I think some kind of a 
notification, I don't know whether it is 30 days, because 
Congress has a way of, if they are dissatisfied with that, 
letting that satisfaction be known to the executive branch, but 
something like that might be appropriate. But I am definitely 
opposed to and recommend that we oppose a term and specific 
reasons for dismissal.
    Mr. Cooper. But then you would be wholeheartedly in support 
of the bill, right?
    Mr. Johnson. I think some legislation is called for to deal 
with some of these things, but I think I am opposed to some of 
them.
    Mr. Cooper. Ms. Fong, Dr. Boesz, would you have a reaction 
to that?
    Ms. Fong. I think we are struggling with the very heart of 
the nature of the IG role, which is independence, and how to 
best ensure that. The sense that I have from my colleagues in 
the community is that it would be very helpful to have some 
kind of protection so that IGs, when they take a position, have 
the understanding that they will not be removed tomorrow for a 
reason that may not be apparent to them, and so, in trying to 
develop proposals, we looked at terms, we looked at removal for 
cause. I think your idea about advanced notice to Congress so 
that there would be an opportunity for oversight is also 
something that is worth exploring.
    The bottom line is that, as IGs, when we operate within our 
agencies we need the agency managers to see us and to say, that 
is the IG I am dealing with today, that is the IG that I expect 
to be dealing with tomorrow, regardless of whether they take on 
difficult issues. So how do we best protect that?
    Mr. Cooper. I agree with you.
    Dr. Boesz.
    Ms. Boesz. I would agree very much with that last 
statement. The IG needs some constant consistency throughout 
their tenure, whatever it may be.
    The 30 day advance notice to Congress, in my personal view, 
is a much better approach than a term limit; however, we still 
need to think through how that affects someone who is a Federal 
employee with specific rights, rather than a Presidential 
appointee.
    Mr. Cooper. I see my time is expiring. I want everyone to 
know I am very sensitive to your concerns, and I hope that we 
can address them. I am just thankful that finally legislation 
may be moving, because we have had this bill now for 4 or 5 
years. It has been a long wait, and it is about time that 
Congress responded to some of these problems.
    I want to pay particular tribute to Cicily Simpson, who is 
helping me with the bill now, and also to Ann Kim, her 
predecessor, because we couldn't have done this work without 
them.
    Thank you, Mr. Chairman.
    Mr. Johnson. May I make one comment? I am also not aware 
that you all feel that an IG has been removed unnecessarily. 
Aren't we talking about a possible problem, or is your feeling 
that, in fact, we have had instances of unwarranted removal?
    Mr. Cooper. The effort was for professionalization, and we 
have to anticipate all future circumstances. No, I am not 
blaming anyone. We just want IG's stature to be enhanced so 
that they can do an even better job of protecting taxpayers. 
That is all we are interested in.
    Mr. Towns. Congressman Duncan from Tennessee.
    Mr. Duncan. Well, thank you very much, Mr. Chairman. I 
won't have any questions, since I just got here. I will say 
that I commend my colleague from Tennessee, Mr. Cooper, for 
introducing this bill. In the 106th Congress I introduced a 
bill to make all of the Inspectors General Presidential 
appointees. At any rate, we later ended up passing a bill to 
make the Inspector General for TVA an independent.
    I do have some questions as to how these terms are going to 
be defined. The one that leaped out to me was inefficiency. I 
mean, we could remove half the people in the Federal Government 
if we are going to talk about inefficiency. But at any rate, 
there are some of these things that probably need to be defined 
in a little more detail, but I think that the goal of the 
legislation is good and I think it is something that I would 
try to support.
    Thank you very much.
    Mr. Towns. Thank you very much. That is another bill. That 
is another bill.
    Mr. Miller.
    Mr. Miller. Thank you, Mr. Chairman.
    Mr. Johnson, I want to pause and celebrate a point of 
agreement. I said in my opening statement that I applaud Mr. 
Cooper for raising the issue, but I do agree with you that the 
list of reasons for which Inspectors General can be removed is 
too narrow.
    Mr. Bilbray said in his opening remarks that the Inspector 
General was the eye in the sky, was his term, and you 
apparently disagreed in part with that and said that the GAO 
was really more the Congress' watchdog. Do you agree with this 
statement about the role of Inspectors General: ``Inspectors 
General report both to the head of their respective agencies 
and to the Congress. This dual reporting responsibility is the 
framework within which Inspectors General perform their 
functions. Unique in Government, dual reporting is the 
legislative safety net that protects the Inspectors General 
independence and objectivity.''
    Mr. Johnson. I agree with that. What I said, though, was 
that it is more than your Congress' eye in the sky, it is the 
executive branch's eye in the sky. You have your own----
    Mr. Miller. Right.
    Mr. Johnson [continuing]. And then you also have the IGs. 
You have two eyes in the sky. We have one, which is the IGs. 
And so it is not just an asset for Congress; it is a huge asset 
for agency heads and the executive branch.
    Mr. Miller. Right. This, of course, as I hope you know, 
comes from your own agency's standards.
    Mr. Johnson. Yes.
    Mr. Miller. You would agree, then, that it is a problem 
that Congress does not have confidence in the objectivity and 
independence of an Inspector General?
    Mr. Johnson. Yes, that would be a problem. Yes.
    Mr. Miller. OK. It would be a problem with his doing his 
role as contemplated by the statute and by the standards of 
conduct.
    Mr. Johnson. There are also opportunities for differences 
of opinion, obviously.
    Mr. Miller. OK. And that independence is not just a matter 
of whatever the reality is, but appearance matters, as well. 
Independence is a critical element of objectivity. Without 
independence both in fact and in appearance, objectivity is 
impaired. Do you agree that independence is important?
    Mr. Johnson. Yes. Right.
    Mr. Miller. With respect to Mr. Cobb, again, your own 
office's report said that he routinely had lunch weekly with 
Mr. O'Keefe, the chief of staff, the Council. It was usually in 
the NASA employees' cafeteria; that Mr. Cobb frequently, or 
occasionally, at least, played golf with Mr. O'Keefe, he went 
up to Mr. O'Keefe's office for drinks, he referred to Mr. 
O'Keefe as his boss. For an employee of NASA who wanted to blow 
the whistle or who saw something going on that he did not like 
and wanted to find someone to tell about it, would that 
employee have confidence in Mr. Cobb that Mr. Cobb will handle 
the information in the proper way and would protect the 
confidentiality of that employee's reporting it?
    Mr. Johnson. I don't know what would affect that employee's 
feelings about Mr. Cobb's independence. Let me address this a 
little bit indirectly. I know two very senior IGs, very senior 
IGs. One would think nothing of going to the agency head's 
Christmas dinner at the agency head's house. The other one 
wouldn't do it with a gun held to his head. They are both 
outstanding IGs. They have very different views about what 
appearance is proper and what is improper.
    I would suggest to you in a very small way that says there 
is no correlation. I defy anybody to demonstrate any 
correlation between whether somebody has lunch with the agency 
head and the quality of the IG's work. I have never heard you 
say and I never heard the Integrity Committee say that the 
quantification of the NASA IG's work is in question.
    Mr. Miller. Actually, Mr. Johnson, it is. The evidence is 
that the number of audits produced by Mr. Cobb's office has 
fallen to half what it was under his predecessors, so yes, the 
quantity----
    Mr. Johnson. Is the dollar value of them halved?
    Mr. Miller. Well, I didn't come prepared to cross-examine 
you on the facts.
    Mr. Johnson. It is a good thing, because I don't know the 
facts, either, but I just heard you specify that number, which 
we are in the dollar business, not the number of audit 
business.
    Mr. Miller. My understanding is it has fallen to half.
    Ms. Fong, you are in Inspector General. What is your view 
of that kind of level of a visible relationship to employees 
between the Inspector General and the top political leadership 
of the department? Does that create a problem in your mind?
    Ms. Fong. It is probably one of the most difficult issues 
that IGs face, exactly what is the proper kind of relationship 
with an agency head. I think each IG has to work it out for 
himself or herself.
    I can speak to you about my own personal experience. 
Personally, I am most comfortable when I have an arm's length 
relationship with my agency head. It is not to say it is not 
cordial, that we don't have a very good, constructive working 
relationship and I can brief him at any time on issues, but for 
me an arm's length relationship ensures that anything that 
comes up that I need to look at, I am able to look at without a 
sense of my independence being on the table.
    Mr. Miller. OK. And how about the importance of the 
appearance to others, either employees or to Congress?
    Ms. Fong. We certainly are always very aware of 
appearances. At any time any of us can have allegations filed 
about our conduct, and so I think we are all very sensitive to 
the fact that we need to appear impartial and, of course, 
actually be impartial, as well.
    Mr. Miller. OK.
    Mr. Johnson. One thing, we are talking about Mr. Cobb, this 
and that, the Integrity Committee, which is the official 
investigating entity that produced the report, which is made up 
of an FBI senior person, the head of the Office of Government 
Ethics, Office of Special Counsel, Office of Government Ethics, 
and three IGs found Mr. Cobb was--there was the appearance of 
lack of independence, appearance, but no suggestion that 
anything about his findings were anything but independent, and 
that there was abuse of authority.
    There were 27-odd other allegations that were made, some of 
which you referenced, in terms of his behavior, which he was 
found not to be ``guilty'' of. And I think Administrator 
Griffin, as he has indicated, is in the process of addressing 
that. There has been no accusation that he's the problem with 
dependence, lack of appearance of independence from Mr. 
Griffin.
    So he remains in the office there, because the feeling of 
the administration, and in consultation with Mr. Griffin, is 
that he can do a very good job as the Inspector General at 
NASA.
    Mr. Miller. Mr. Chairman, I don't want to abuse your 
generosity, but I would like to pursue that point for just a 
minute more, if I could.
    Mr. Towns. You can.
    Mr. Miller. Mr. Johnson, the PCIE report said, among other 
things, concluded that Mr. Johnson would confer with the top 
management--I am sorry, Mr. Cobb would confer with the top 
management at NASA in the design of audits, and then would send 
to them draft copies of findings of audit reports before it was 
issued for their reaction and audit it, and sat on some 
findings in response to their concerns. That strikes me as more 
than an appearance. That strikes me as the reality of a lack of 
independence. Does that not strike you as something more 
troubling than unseemly appearance?
    Mr. Johnson. It doesn't. I am not an IG. Dr. Boesz and Ms. 
Fong are IGs. It is standard practice before a report is issued 
that they be sent to agency leadership for official comment, 
and then it is issued with agency's comment. I don't know if 
what you are referring to is that process or something other 
than that process.
    Mr. Miller. Actually, I think I did not speak correctly. It 
was before they were even a draft. It was before the audits.
    Mr. Johnson. Three IGs, the Criminal Investigation at FBI, 
Government Ethics, Special Counsel looked at that and found 
that not to be problematic, so I just--you ought to ask them 
that question.
    Mr. Towns. I want to followup, Mr. Johnson.
    I understand there is a process in place for investigating 
complaints against IGs.
    Mr. Johnson. Yes.
    Mr. Towns. The Integrity Committee of the PCIE----
    Mr. Johnson. Yes.
    Mr. Towns [continuing]. Works with another IG's office to 
conduct an investigation. My question is this: what happens 
after the Integrity Committee reports back? They send a report 
to the Chair of the PCIE, Mr. Johnson, and what happens after 
it lands on your desk?
    Mr. Johnson. I have had some opportunity to understand the 
answer to this question in the last couple of months. Here is 
my understanding of the answer to that question: they do their 
report. It comes to me as the Chair of the PCIE.
    Mr. Towns. Right.
    Mr. Johnson. Because these are with the PCIE, they are 
Presidential appointees. If the identified behavior appears to 
warrant consideration by the White House for dismissal, I would 
bring that up with the White House.
    Mr. Towns. Do they vote on it? At PCIE do you vote on it?
    Mr. Johnson. No. PCIE is not involved in this.
    Mr. Towns. All right.
    Mr. Johnson. There is an Integrity Committee. We were 
talking about the report by the PCIE. There is an Integrity 
Committee that is under the umbrella of the PCIE. The people 
that produce the report are, the chairman is somebody 
designated by the Director of FBI, the Office of Special 
Counsel, the Office of Government Ethics, and three IGs, so it 
is a group of six. They produce a report.
    Mr. Towns. But is there any voting on this, or is it the 
President's decision?
    Mr. Johnson. I don't know how it works. The six of them 
produce this report.
    Mr. Towns. Yes.
    Mr. Johnson. With findings. They say, here's all the 
allegations, here's what we found to be of substance. It comes 
to me. If there is suggestion that this ought to go straight to 
the White House, I take it straight to the White House. If not, 
it would go to the head of the agency for review and 
consideration. Then the head of the agency determines whether 
they have confidence in the IG, whether they want to recommend 
to the President that the IG be removed, whether there be 
sanctions, there be some change in the organization, but it 
goes to the agency head.
    That then goes back to the Integrity Committee through me. 
I get it from one, I hand it to the other. It goes back to the 
Integrity Committee. Then the Integrity Committee gets it, 
finds out what the head of the agency wants to do, and if they 
agree that is it. If they want to comment on it, think it is 
too much or too little, they issue another report that says 
whatever they want to say, and then it is sent. So that is the 
basic process.
    Mr. Towns. Right. So it is up to you, if you want to move 
it on, you move it on; if you don't----
    Mr. Johnson. No.
    Mr. Towns. No?
    Mr. Johnson. No. It comes to me from the Integrity 
Committee.
    Mr. Towns. Yes.
    Mr. Johnson. If the behavior is found to be egregious 
enough that I think possible dismissal, removal by the 
President ought to be the only question, then I would take it 
directly to the White House. If it is, in my estimation, less 
than that, then it would go to the agency head. This is per an 
Executive order that President Clinton signed in 1994 or 1997 
or something.
    Mr. Towns. In other words, you have to send it somewhere?
    Mr. Johnson. I have to send it somewhere, yes. It goes to 
the agency head, and because they share the goal of the success 
of NASA, in Mr. Cobb's case, and so they decide whether he 
believes NASA can have a well-functioning IG operation, given 
this information, or not. And they would come back and go in 
writing and come back to the Integrity Committee through me 
with what their response to the findings of the Integrity 
Committee are.
    Mr. Towns. All right. Thank you.
    Mr. Johnson. If it sounds convoluted, it is because it is a 
little convoluted.
    Mr. Towns. Yes, I agree with that, but it seems like to me 
you have a lot of power, though. It seems to me you have a lot 
of power in the process. Yes.
    Mr. Johnson. I am more of a messenger. I really don't have 
any power in the Integrity Committee, itself, on purpose. It is 
set up that way. It is the Inspector General, the investigative 
community investigating its own.
    Mr. Towns. Yes. But I think the reason I say you have a lot 
of power, I heard the words ``pass on to the White House.''
    Mr. Johnson. That is if in my estimation the findings are 
such that----
    Mr. Towns. To me that is power.
    Mr. Johnson. Well, it is.
    Mr. Towns. I am not going to belabor the point here. But, 
anyway, you get the point.
    Dr. Boesz, does your evaluation affect your pay increase or 
your bonus?
    Ms. Boesz. The evaluation? I am an SES person, so yes, I am 
eligible for a bonus and for pay for performance under the way 
the agency works under the new Civil Service reform. It is set 
up so that, yes, if I don't perform, don't get an evaluation, I 
wouldn't get a raise.
    Mr. Towns. Doesn't that make it hard for you to be 
independent?
    Ms. Boesz. No, not at all, sir. Not at all, because it is 
all done on metrix. It is done on the performance of the 
office. It is not done on my personal performance. It doesn't 
bother. I don't feel at all conflicted there.
    I should point out that I work for the National Science 
Board. I don't work for the director of NSF. There is an arm's 
length between me and management. The Board has oversight 
responsibilities, and I think that metric makes a difference. 
Many of the ECIE IGs do work for either boards or commissions, 
and so we do have arm's length from management. I think that is 
the key why it doesn't affect the independence ability.
    Mr. Towns. All right. Thank you very much.
    Any other questions from Members?
    [No response.]
    Mr. Towns. Let me thank all three of you for your 
testimony. I am sure you will be hearing from us again. Thank 
you very much. It was a pleasure.
    I would like to welcome our second panel. As with the first 
panel, it is our committee policy that we swear our witnesses 
in.
    [Witnesses sworn.]
    Mr. Towns. Let the record reflect that they all responded 
in the affirmative.
    I will briefly introduce each witness.
    Eleanor Hill--welcome to the committee--was with the 
Department of Defense from 1995 to 1999. She was Staff Director 
of the 9/11 Commission and the Senate Permanent Subcommittee on 
Investigation, and is a former Federal prosecutor.
    Ken Mead was Inspector General of the Department of 
Transportation from 1997 to 2006. Prior to his service as an 
IG, he served for 22 years at the Government Accountability 
Office.
    Nikki Tinsley was Inspector General of the Environmental 
Protection Agency from 1998 to 2006. Prior to her appointment 
she served as an auditor for the EPA, Department of Interior, 
and Government Accountability Office.
    Jeffrey Steinhoff is Managing Director of the Financial 
Management and Assurance at the Government Accountability 
Office. He has 38 years of Federal service, more than half of 
them spent as a senior executive at GAO.
    Fred Kaiser and Vanessa Burrows are the experts on IG 
issues for the Congressional Research Service at Library of 
Congress. Mr. Kaiser is a specialist in American national 
government, and Ms. Burrows is a legislative attorney.
    Your entire statement, for all of you, will be in the 
record. I ask each witness to summarize their testimony within 
the time we have allotted, which is 5 minutes. The yellow light 
means your time is running down and the red light means your 
time has run out, so we will start with you, Ms. Hill, and then 
we will just go right down the line.

 STATEMENTS OF ELEANOR J. HILL, FORMER INSPECTOR GENERAL, U.S. 
   DEPARTMENT OF DEFENSE; KENNETH M. MEAD, FORMER INSPECTOR 
 GENERAL, U.S. DEPARTMENT OF TRANSPORTATION; NIKKI L. TINSLEY, 
  FORMER INSPECTOR GENERAL, ENVIRONMENTAL PROTECTION AGENCY; 
 JEFFREY C. STEINHOFF, MANAGING DIRECTOR, FINANCIAL MANAGEMENT 
 AND ASSURANCE, GOVERNMENT ACCOUNTABILITY OFFICE; AND VANESSA 
BURROWS, LEGISLATIVE ATTORNEY, CONGRESSIONAL RESEARCH SERVICE, 
ACCOMPANIED BY FRED M. KAISER, SPECIALIST IN AMERICAN NATIONAL 
           GOVERNMENT, CONGRESSIONAL RESEARCH SERVICE

                  STATEMENT OF ELEANOR J. HILL

    Ms. Hill. Thank you, Mr. Chairman. Good afternoon, Mr. 
Chairman and members of the subcommittee. Thank you for the 
opportunity to discuss with you this afternoon the role that 
IGs play in what I believe is the promotion of good Government 
in the Federal system.
    While I am now engaged in the private practice of law, I 
did, as the chairman mentioned, have the opportunity to serve 
as the IG for the Department of Defense. I also was extremely 
privileged to really spend the bulk of my career in public 
service, which also included serving as vice chair of the PCIE 
from 1998 through 1999.
    I am very happy to join both Ken Mead and Nikki Tinsley 
here this afternoon. They were both friends and former 
colleagues of mine during our years as IGs.
    Your focus on independence and accountability is absolutely 
on point, in my view, in terms of maintaining the credibility 
and the effectiveness of the IGs as a community in the Federal 
Government. Although the idea of Inspectors General has been 
around really since the 17th century Europe in terms of 
military Inspectors General, the idea of a truly independent IG 
as we know them today are a relatively modern phenomenon, and 
Congress gets credit for the idea with the IG Act of 1978. That 
act went far beyond the traditional military Inspector General, 
and the principal difference, in my view, is the whole concept 
of independence.
    I mentioned the military IGs, because during my term at 
Defense at the Pentagon I had the opportunity to work with many 
of them. Also, the DOD is unique. It is so large that it has a 
number of other what we call administrative IGs at the various 
Defense agencies. As the departmental Inspector General, I 
worked with all of them on numerous occasions, and my work with 
them really enforced for me the importance, the absolute 
critical importance of independence to the statutory IGs.
    I can tell you that on numerous occasions, for example, 
military Inspectors General in the Department of Defense would 
come to our office and ask us to conduct top-level, 
particularly sensitive investigations because they, the 
military IGs who did not have statutory independence and 
operated within the chain of command, believed that they did 
not have the independence needed to make their investigation 
both actually be objective and appear to be objective within 
the Department and to Congress and to the American public, for 
that matter.
    I also had numerous conversations with various 
administrative IGs within the Department of Defense. This would 
include Defense agencies like DIA, NSA, NRO. They served 
without the benefit of statutory independence. They serve at 
the pleasure of the directors of their agencies. And they also 
would ask us to take on those kinds of investigations. They 
recognized that in investigations of very senior officials or 
in audits of programs that are dear to an agency head, 
statutory independence was absolutely critical to both the 
integrity of the inquiry and to the credibility of the findings 
in the Department, on Capitol Hill, and with the American 
Public.
    I must tell you that I could not help but recall those 
conversations last year when I read reports that oversight of 
what is now termed the NSA terrorist surveillance program, 
which I am sure you are familiar with, had been handled not by 
the Department of Defense IG, who is independent, but rather by 
the NSA IG, who has limited resources and no statutory 
independence. In my view, that is exactly the kind of program 
where the oversight should have been conducted from the very 
beginning by the independent statutory IG.
    Independence, more than anything else, goes to the very 
heart of the IG missions. The statutory requirements--and you 
are familiar with them--and the 7-day letter requirement, the 
ban on Secretarial interference with IG work, etc., all taken 
together in my view make the IG the most independent and the 
most unfiltered voice in any Federal department under the 
Secretary.
    As an IG, I was very fortunate in that I never felt forced 
to sacrifice or compromise my independence. The provisions in 
the statute, however, are not foolproof, as one would expect. 
There are other factors that do impact independence. In my 
case, I would say there were several where I was very 
fortunate. I worked with two Secretaries of Defense, two 
Secretaries, Bill Cohen and Bill Perry, both of whom really 
understood, appreciated, and accepted the role that an IG can 
play in a constructive way in a Federal department.
    I also had the benefit of becoming an IG only after I had 
been schooled for many years in jobs where independent factor 
of an investigation was really the norm. That is what I knew as 
a professional. I had been a Federal prosecutor and I had been 
a congressional investigator for years in a committee where 
inquiries by investigators were very bipartisan.
    Clearly, IGS must be comfortable with their independence. 
They must fully understand its importance. They must be willing 
to exercise it and they must be prepared to defend it, if 
necessary.
    Independence also, in my view, beyond what is in the 
statute, depends on Congress. It depends on Congress remaining 
attentive to IG findings and remaining engaged in exercising 
its own oversight. For the concept to work, Congress has to be 
an active player. Congress has to insist on thorough and 
objective oversight from the IG, separate and apart from the 
views of any department and any administration. When that 
happens, the overwhelming incentive for any IG is to resist 
attempts at politicization from either side. The best way to 
succeed when answering to those two masters is to conduct 
independent, professional, and fact-driven investigations.
    H.R. 928, as you know, has several provisions, all of which 
would add to statutory independent protections that already 
exist. Because I believe so strongly in the need for 
independence, I do support all of those changes.
    I also want to say a few words about accountability. 
Independence gives IGs power. When they have that power, they 
have to expect to be held accountable and they have to be held 
accountable. While we hope that all IGs take the high road, the 
system has to be capable of addressing allegations of 
misconduct. The public must be assured that those who enforce 
high ethical standards on others are, themselves, held to the 
same standards. There must be a clear and convincing answer to 
the question: who is watching the watchdog?
    The IG community--and I remember this from my years with 
the PCIE--has wrestled for years with the idea and the question 
of how to ensure accountability but not sacrifice independence. 
The lack of clear legal authority, insufficient resources, and 
recordkeeping problems hampered early efforts by the PCIE to 
address the issue. Both IGs and OMB worked together to prompt a 
March 1996 issuance of the Executive order which confirmed the 
PCIE Integrity Committee's authority and process, which Mr. 
Johnson spoke of earlier.
    I can tell you there were still problems, in my memory, 
with implementation after that Executive order. I remember at 
least one occasion where I wanted an investigation where I had 
allegations of serious misconduct by senior IG employees. I 
went to the Integrity Committee, referred it to them. They 
actually sent it back to me. I had to go back again and insist 
on them taking the investigation, which they ultimately did. So 
there were some bumps along the way in getting it started.
    H.R. 928 certainly would codify the existence and the 
authority of the Integrity Committee. I support that, not only 
because it further clarifies the authority of the committee, 
but also because it sends a clear message to the American 
public and to the agencies and departments that the law will 
ensure that IGs are held accountable.
    In closing, I just would note that I have truthfully been 
very dismayed by the reports in recent years of less 
congressional oversight, coupled with reports of less 
independence and less professionalism in the IG community. As 
an investigator, I know better than to pre-judge the accuracy 
of those reports without access to all the facts, so I do not 
know to what extent those reports are true. But I can only tell 
you that, for the good of the country, in my view, I hope they 
are not.
    The rigorous but always objective and fair exercise of the 
congressional oversight power, bolstered by the work of the 
independent and professional IG community, is in my mind 
clearly the surest way to promote integrity, credibility, and 
effectiveness in Government. The American people deserve and 
quite rightly expect no less.
    Thank you for the opportunity. I look forward to your 
questions.
    [The prepared statement of Ms. Hill follows:]
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    Mr. Towns. Thank you very much.
    Mr. Mead.

                  STATEMENT OF KENNETH M. MEAD

    Mr. Mead. Thank you, Mr. Chairman. I am really thankful for 
the invitation to testify. I appreciate the opportunity to work 
with a number of you over the years, Mr. Cooper on various IG 
issues; Mr. Duncan, I always consider him a leader in the 
aviation world; Mr. Davis I remember well sitting in the Court 
of Appeals courtroom up in Boston on a big dig hearing he was 
chairing.
    I served under two Presidents, Clinton and Bush, and 
decided to step down after almost 9 years. That means I worked 
for both Secretary Slater and Secretary Mineta. I have absolute 
respect for them both. They had tremendous regard for IG 
independence.
    Before becoming IG, I worked in the GAO. I make note of 
that not really so much as a biographical point, but as a way 
of saying that I think GAO is an extraordinarily good source of 
candidates to be IG. I spent 22 years there. It was a great 
training ground. I think some of my core values were formed in 
that institution.
    I am also real proud of the DOT IG team for their 
dedication to duty and continuing accomplishments.
    Just on a personal note, I want to say something about the 
IG job. You know, it is a real difficult job and it is 
sometimes kind of lonely, but in my estimation it is among the 
greatest rewards and honors of public trust that the Government 
has to offer, just terrific opportunities to do good for the 
taxpayers.
    As far as the law is concerned, I believe that the bill, 
H.R. 928, recognizes this, as well. I don't think the law is in 
need of wholesale change. Just a couple context perspective 
points on that: The essential design of the IG job is, as a 
fellow named Paul Light, he worked for Senator Glenn. Some 
people think Senator Glenn was one of the fathers of the IGs. 
But Paul Light told me, when I was being vetted for the IG, he 
says, Don't forget this: the job of the IG is to speak truth to 
power. You won't find those words in the IG Act, but that is 
really, when you add it all up, what we are supposed to be 
doing. The IGs who use that principle as their compass will 
best serve the taxpayer, the Congress, and the taxpayers.
    You are going to have to do some painful and unpopular 
things as IGs. Sometimes people won't want to have lunch with 
you. But that just comes with the job.
    Relationships with the Congress and the Secretary--the act 
requires, as has already been pointed out, it has a dual 
reporting obligation. You have to keep the Congress and the 
Secretary fully and currently informed. That is not a 
discretionary duty; it is a mandate. It is a requirement of 
law. I think that single provision of law is the most important 
strength of the IG act. It is a duty for which we all ought to 
be held accountable.
    But there is the powerful reinforcing corollary to this 
that applies to both the Congress and the Secretary. For the 
Congress, that corollary is the regularity and depth of 
oversight of agency programs, the extent to which they pay 
attention to the IGs work. For the Secretary, it is the value 
that the Secretary attaches to oversight, regularity of access 
by the IG to the Secretary, and also that the agency heads--
like in our case FAA, Highway, NHTSA, and so forth and so on. 
There are ten of them, I think--they know that the Congress is 
watching and that the Secretary is watching, and that there is 
a demand for respect of the IG's findings.
    I think that is one of the reasons why the DOT's IG's 
office work is held in such high regard today. It is not just 
because that work is quality; it is because Congress pays 
attention to it and the Secretary does, too.
    A couple of points on relationship with the Secretary. I 
think it has to be one built on mutual respect and trust. I 
think the IG has to be independent, but you don't want the IG 
blind-siding the Secretary. When the Secretary hears about an 
IG finding on the nightly news or reads about it in the 
Washington Post for the first time, in my view the IG has 
probably dropped the ball. I don't believe that should be 
happening.
    Also, the IG can't just take the independence to an 
extreme. If you do, you are going to be marginalized. The IG 
needs to make recommendations, and workable recommendations, 
not just drop it in the Secretary's lap, walk away, and come 
back a couple years later and say, My god, the problems are 
still there. They may be there anyway.
    Term of office--I think it has already mentioned, 928 
establishes the renewable 7 year office for removal only for a 
specific cause. In my own case, I don't think the term of 
office or removal for cause would have enhanced my independence 
or affected us as IG. It would have detracted from it, either. 
But from what I have seen--and I used to have Phyllis Fong's 
position as legislative committee chair--in talking with 
colleagues, I think the idea of giving advance notice to the 
Congress in writing and a statement of reasons is a good idea. 
Mr. Duncan mentioned, though, I would be careful about 
enumerating all these things. You get into inefficiency, and 
inefficiency is not an intuitively self-defining term. So, on 
balance, I think that might be the best approach.
    I think also, for the IGs that are not appointed by the 
President, that would be a good approach, too.
    Budget? Submission of budget, I think Mr. Cooper's bill has 
it about right. The IG's original budget request ought to be 
submitted along with the President's final recommended budget. 
For example, when the budget outlays for advocacy or highways 
increase sharply, you should expect, the Secretary should 
expect, the taxpayer probably should expect that the IG is 
going to be expanding audit coverage. If the IG can't expand 
audit coverage because the President, for that matter, isn't 
going to recommend enough resources, there ought to be some 
memorialization of that and the Congress ought to be aware that 
is going to be one consequence.
    IG candidate pool and IG pay? I think it has been made 
pretty clear today that this is a problem. I don't believe that 
the IG Act's statement of qualifications needs agency change. I 
think the acid test is in the nomination and conformation 
process and learning a person's core values.
    But on the issue of pay, you have a problem. I am concerned 
about the adequacy of IG pay, particularly if you want the IG 
to stay on board for more than the average tenure of the Senior 
executive branch official. If Mr. Cooper's bill becomes law, 
you have a minimum of 7 years. That is a lot longer than the 
average executive branch senior legislation person.
    I am not going to belabor the very significant pay 
disparities, but I can tell you that I am the victim of it. At 
the 6 or 7 year point, a new law took effect. I was career SES, 
and all of the sudden my pay was essentially frozen. My entire 
senior staff was getting paid substantially more than me and, 
while I don't think bonuses are appropriate for IGs, I do think 
you have to do something about this.
    The problem exists also with the people that weren't career 
SES. You expect IGs to come in and spend 7 years on the job, 
executive level four with no possibility of promotion. That is 
just one step from the bottom. This goes from, I think, 
executive level one through five.
    Codification of the IG Council, I think H.R. 928 has it 
about right here, too. I would encourage you, though, before 
just reenacting the Integrity Committee provisions and carrying 
them forward, I think you would do everybody a service if you 
reviewed the due process procedures established by the IC, the 
consistency of their application, and why it takes so long to 
conduct some of these investigations. That is important to do 
not only because of accountability, but in fairness to the 
Inspectors General who end up getting investigated. And I think 
it would bring greater transparency to the IC process.
    A going forward step there might be for you to off-the-
record invite some of these prior IGs in. I don't know if they 
would be open to that, but that concludes my statement.
    [The prepared statement of Mr. Mead follows:]
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    Mr. Towns. Thank you very much. Let me just say to the 
witnesses there is a red light there. I just don't want you 
completely ignore that light, OK? Thank you.
    Ms. Tinsley.

                 STATEMENT OF NIKKI L. TINSLEY

    Ms. Tinsley. Good afternoon, Mr. Chairman, members of the 
subcommittee. I appreciate your giving me the opportunity to be 
here today to discuss independence, accountability, and other 
issues affecting the Inspector General community. I believe 
that Inspectors General play a vital role in improving 
Government operations, and that, working together with the 
Councils on Integrity and Efficiency, they are uniquely 
positioned to contribute to Government reform.
    Knowing that I was going to be on a panel with Mr. Mead and 
Ms. Hill, I knew they would do a good job of addressing the 
provisions of the legislation. I am going to limit my oral 
statement to an issue that I am passionate about. I am going to 
belabor the salary issue, even though Ken did not.
    This is about pay disparities and the negative financial 
impact that accepting a position as Inspector General has on 
career Federal employees.
    The first step in ensuring that Inspectors General would be 
at high quality takes place in the selection process. Congress 
intended that Inspectors General be nonpartisan, independent, 
objective, and of the highest integrity. Career civil servants 
provide an excellent pool of candidates for Inspector General 
due to their experience in Government and the nonpartisan 
nature of their positions. Unfortunately, because of pay 
disparities, many qualified career employees are no longer 
willing to accept appointments as Inspector General. This is 
because virtually all Inspectors General appointed by the 
President, subject to Senate confirmation, receive 
significantly less pay than their subordinates, the senior 
managers who report directly to them, and significantly less 
pay then their peers, other career civil servants who accept 
appointments.
    Past career civil servants appointed as Inspectors General 
were members of the Senior Executive Service and were often 
affiliated with the agencies where they were appointed IG. They 
brought an invaluable and welcomed level of knowledge and 
experience to the IG position. They were routinely rated and 
recognized as outstanding SES performers and received the 
maximum pay for SES members at the time of their Presidential 
appointments.
    The Civil Service Reform Act of 1975 codified in Title 5 of 
the U.S. Code allows members of the SES who are appointed by 
the President to a position which is not in the SES to elect to 
retain their SES pay and benefits as if they had remained in 
the SES position from which they were appointed. The 
legislative history for this provision reveals that it was 
intended to make it possible for career employees to serve in 
top-level policy jobs outside the competitive service without 
losing their status as career employees.
    OPM says that this provision is used to encourage career 
executives to serve at the highest levels of the Government and 
to broaden the pool the President can use to choose top 
managers. Title 5 allowed SES members to accept appointments as 
Inspectors General to retain their SES pay until the 2004 
Defense Authorization Act ended pay equity for SES Inspectors 
General. The 2004 act made the SES members' annual pay 
increases dependent on performance evaluations. Because of the 
unique position Inspectors General occupy within the Federal 
Government, there is no superior within the agency or 
department that can evaluate their performance without creating 
the appearance of a conflict of interest, and bringing the 
Inspector General's objectivity into question.
    In addition, beginning in 1994, the administration asked 
Presidentially appointed Inspectors General drawn from the 
ranks of the Senior Executive Service to waive their rights to 
compete for annual bonuses. These awards commonly range from 5 
to 20 percent of the employee's annual salary.
    In addition, SES Inspector Generals are not considered for 
Presidential rank awards ranging from 20 to 35 percent of 
salary, awards that their colleagues are eligible to receive 
and their peers in the paths frequently do receive.
    Since implementation of the 2004 act, Inspectors General 
who retained their SES continued to be paid at their 2003 
salary level, around $142,500. Other members of the Senior 
Executive Service in other paths who retained their SES status 
can receive salaries up to $168,000. The financial impact of 
the restriction on pay plus the elimination of award 
eligibility can amount to $80,000 annually. It lowers not only 
the Inspector General's standing when compared to other 
executives, but also his or her retirement annuity.
    The 2004 act plus the elimination of awards creates a 
disincentive for current SES members to accept a position as 
Inspector General. It inadvertently created the precise 
situation the Civil Service Reform Act sought to avoid with its 
explicit allowance for Presidential appointees to retain their 
SES status to ensure that the President had the broadest 
possible pool of candidates to select from when filling these 
important positions.
    My testimony has some options. There are a lot of people 
who have ideas on options to address the salary and bonus 
issue. I will say that I think that the one way to solve the 
salary problem is to pay career SES members who accept 
positions as Inspector General at the ceiling rate of the SES 
pay scale. I think they deserve that because of their unique 
positions working for the administration and the Congress and 
spanning administrations.
    Thank you.
    [The prepared statement of Ms. Tinsley follows:]
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    Mr. Towns. Thank you for your testimony.
    Mr. Steinhoff.

               STATEMENT OF JEFFREY C. STEINHOFF

    Mr. Steinhoff. Mr. Chairman, members of the subcommittee, I 
am most pleased to be here today to discuss H.R. 928 and 
applaud the efforts of Representative Cooper and this 
subcommittee to work to enhance IG independence and 
effectiveness.
    Before providing my perspectives on the bill, I would like 
to briefly highlight the concept of auditor independence which 
is at the heart of the IG Act and to the range of issues the 
bill addresses.
    Independence is the cornerstone of professional auditing. 
Government auditing standards state, ``In all manners relating 
to the audit work, the audit organization and the individual 
auditor, whether Government or public, must be free from 
personal, external, and organizational impairments to 
independence, and must avoid the appearance of such impairments 
to independence. Audit organizations must maintain independence 
so that their opinions, findings, conclusions, judgments, and 
recommendations will be impartial and viewed as impartial by 
objective third parties with knowledge of relevant 
information.''
    In a nutshell, this is what auditing is all about, and the 
principal reason Congress can place value and reliance on the 
work of GAO and IGs as an independent set of eyes and ears. 
Without independence, there is very little left and you really 
have no more than a consultant, or someone's view.
    With this concept in mind, I would now like to discuss some 
of the specific provisions of the bill.
    In May of last year, at the request of Congress, the 
Comptroller General convened a panel of recognized leaders, 
people from Federal audit investigative community, the 
Congress, and others highly knowledgeable in IG matters. We 
issued a report in September. I have provided that for the 
record for you all. We had a very wide range and a very 
experienced group to address the issues that are basically the 
issues in Representative Cooper's bill.
    I would just like to provide a couple of perspectives of 
several of these areas.
    First, while some did favor a term of office and removal 
for cause, the majority did not. However, across the board 
people, for the most part, favored advanced notification to 
Congress. So my answer to the question, Representative Cooper, 
you asked Clay Johnson earlier is yes. I think that is a 
plausible solution.
    I will add that an IG to be effective must adroitly 
straddle two worlds. Mr. Mead I think hit it very, very well. 
They have to work in a very constructive, positive way within 
the agency they are serving, and they must further have strong 
relationships to the Congress. Whereas terms of office and 
removal conditions may or may not be important to independence, 
what I think at the end of the day is perhaps the most 
important is the selection and confirmation process and then 
the regular oversight by Congress, is Congress bringing the IG 
up, is Congress asking the IG for something. I know that the 
IGs that are most successful are the ones that do have those 
relationships.
    Second, the provisions in the bill that deal with the 
budgets. The views of the panel were very, very mixed. I would 
say that most believe that the separate budgets for 
Presidential IGs, that process works and that process should be 
extended to the DFEs, the non-Presidential IGs.
    I would add a broader perspective here. I think it is very 
important, because I don't think there is an IG or GAO that 
would say that we didn't need more money; that as Congress 
looks at the appropriation request for an IG, that they 
consider the return on investment. That would be a very 
important factor in determining whether these are being 
sufficiently staffed or not.
    The chairman talked about, I think it was $9.9 billion in 
his opening. I think GAO's savings last year were over $50 
billion. But I am not sure the budgets of either party are 
looked at fully in terms of what is the return on investment, 
so that is something you might want to look at.
    Third, the GAO has long held and called for a combined IG 
Council in statute, together with a separate appropriation 
account to fund the council. We are supportive of that. Our 
panel had mixed views as to whether this should be established 
in statute, but they did favor dedicated funding for the 
existing councils.
    With respect to whether the IG Integrity Committee should 
be in law, our panel was not asked to address that perspective, 
but I will enthusiastically endorse that. This is a very 
important mechanism. It has been a mechanism there for many 
years. While certainly someone might want to fine-tune parts of 
it, as Mr. Mead mentioned, it is something that is very, very 
key, and having it in law would provide, I think, some 
permanence here.
    With respect to pay, we will endorse what others have said. 
Our panel strongly believed that is something that must be 
addressed sooner than later. I will say there are options to 
what is in the current bill, which we think might be kind of 
difficult, and options can be authorities through OPM for some 
of the garden variety things that IGs wish to do, and then, I 
think as was proposed, a real look at whether you tie IG pay 
into SES pay.
    Finally, our panelists overwhelmingly supported the 
provisions relating to investigative and law enforcement 
authorities.
    In closing, since the passage of the landmark act almost 
three decades ago, the IGs have continued to play an essential 
role in improving Government accountability by providing 
objective and independent audits, investigations, covering the 
full range of programs and operations. Independence in both 
fact and appearance has been a critical element to this 
success, and it is essential to the continuing success of the 
IG concept.
    We support overall what Representative Cooper is trying to 
do here and look forward to working with this subcommittee, as 
well as Representative Cooper, as these matters are looked at 
further.
    Thanks again for inviting me.
    [The prepared statement of Mr. Steinhoff follows:]
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    Mr. Towns. Thank you very much, Mr. Steinhoff.
    Ms. Burrows.

        STATEMENT OF VANESSA BURROWS AND FRED M. KAISER

    Mr. Kaiser. Mr. Chairman, may I interrupt for just a second 
to thank, first of all, the subcommittee and you for inviting 
us to testify on behalf of this legislation. I am Fred Kaiser. 
Ms. Burrows and I are sharing responsibility for our prepared 
statement, as well as our oral statement. I must say I have 
been asked to go first, if you don't mind.
    Mr. Towns. We will accept that.
    Mr. Kaiser. OK. Fine.
    The Inspector General Act, as has been noted here, 
celebrates its 30th anniversary next year, and indeed last year 
was the 30th anniversary of the first of the contemporary 
statutory IGs that were created. Several of us at CRS had an 
opportunity to work on that legislation, both with L.H. 
Fountain, one of your predecessors, as well as members of the 
House Government Operations Committee, as it was known at the 
time.
    That legislation and succeeding legislation has had 
bipartisan and bicameral support here on the Hill, and in 
combatting waste, fraud, and abuse IGs have been granted a 
substantial amount of independence, authority, and resources, 
and in combination these assets are probably greater than held 
by any similar internal auditing and investigating office at 
any level of government, here or abroad, now or in the past.
    Nonetheless, H.R. 928 attempts to address recent and in 
some cases longstanding congressional concerns regarding the 
Offices of Inspector General. Given the time we have available, 
however, we will only look at a few of them.
    One we have heard so much about is the fixed term of 
office, 7 years with the possibility of reappointment. The 
grant of a fixed term of office does not run contrary to 
precedent and has been viewed as providing the incumbent with a 
chance to gain expertise as well as independence. However, only 
one Inspector General has a fixed term of office, and that is a 
7-year term which can be renewed in the U.S. Postal Service. 
The Peace Corps IG also has a limited term, but that is only 
indirect because all Peace Corps personnel are limited to 5 
years with a possibility of an extension as far as 8\1/2\ 
years. Nonetheless, only the IG in the Postal Service has that 
specific provision.
    Questions might arise, however, whether 7 years is 
sufficient, since it does not extend across a two-term 
Presidency. In addition, allowing for reappointment, which 
would extend, of course, an incumbent's tenure, might impinge 
on the IG's independence. He or she would be reappointed by an 
official who or whose political allies might be subject to an 
IG investigation at the time.
    Also, a term limit, even if renewable, might still offer a 
lame duck Inspector General if it becomes evident that he or 
she will not be reappointed. Some have, therefore, suggested as 
an alternative that there be a single longer term, 10 or 15 
years, without the possibility of reappointment, as currently 
applied to the Comptroller General.
    Second, the IG budgets and appropriations, again, we have 
heard comments about that. H.R. 928 would require reporting of 
the IG's initial estimates directly to the agency head, Office 
of Management and Budget, and, of course, appropriate 
committees of Congress. This would ensure that all three units 
were aware of the initial estimate, and thus enable each to 
calculate any decrease or adjustment made afterwards by agency 
officials or by OMB.
    In addition to finding any such alterations, the change in 
budget reporting could also contribute to congressional 
oversight of the IG offices and their projected spending, but 
also as well as to OMB and agency leadership. So it enhances 
congressional oversight in a very meaningful way, it would 
appear.
    My colleague, Ms. Burrows, who is an attorney at CRS, would 
like to comment, if she may, on the removal for cause 
provision.
    Ms. Burrows. H.R. 928 proposes a change in the removal 
provision for IGs by requiring that removal by the President or 
the agency head must be for cause on specified grounds such as 
neglect of duty, inefficiency, or malfeasance of office. 
Currently, IGs have limited protection with respect to removal 
from office. IGs can be removed from office for any reason by 
the President or the agency head.
    The Supreme Court has held that Congress has the authority 
to limit removal of individuals by the President, and that 
Congress can determine for which reasons the individuals should 
be removed. In Humphrey's Executor v. The United States, the 
court determined that appointed officers other than officers 
performing purely executive functions could not be removed 
during their terms of office except for the causes listed in 
the statute.
    According to the court, congressional restraints on the 
President's power of removal fall within the principle of 
separation of powers. In Morrison v. Olson, the Supreme Court 
expanded Congress' authority as established in Humphrey's 
Executor. The court held that now Congress has the authority to 
provide for-cause removal protection to any advice and consent 
officer.
    In sum, the addition of the restriction of removal only for 
cause would protect IGs from being removed by the President or 
an agency head based on policy reasons, alone. H.R. 928 
specifies particular grounds for removal, and thus makes clear 
that those reasons are the only ones the President or the 
agency head can remove an IG.
    Thank you.
    [The prepared statement of Ms. Burrows and Mr. Kaiser 
follows:]
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    Mr. Towns. Thank you very much.
    Let me thank all of you for your testimony, and let me 
begin by first--you know, Ms. Hill, you indicated that you 
commented about more oversight from Congress. Could you expound 
on that?
    Ms. Hill. Well, my comments partly reflect my time as IG. 
They also reflect the years I spent doing congressional 
oversight and investigations, which is, if you count 9/11, 
almost 16 or 17 years.
    I just firmly believe that congressional oversight is part 
and parcel of the equation that drives IG independence. Because 
the beauty of the statute, of the IG Act, is that the IGs, if 
they have an engaged Congress and they have, on the other hand, 
an engaged department, which they usually do, since they are in 
the department and they are talking about department 
operations, if both of them are looking closely at what the IG 
does, and normally most of the time Congress and the Department 
may take a slightly different view of what is going on, that 
tension between the views of Congress and the agency almost 
forces those IGs to stick to the facts, to be objective, and to 
do, in my view, professional oversight.
    They cannot go too far over the line each way because 
either the department is going to be on them and call them, if 
they are skewing it to the Congress' side. If they skew it to 
the department side, Congress will be after them. But to make 
that work Congress has to be paying attention, they have to 
look carefully at what the IGs are doing.
    I recall years ago, when I worked on the Senate 
Governmental Affairs Committee and the Subcommittee on 
Investigations, and that full committee was one of the 
committees that was heavily engaged in the drafting and the 
passage of the original IG Act, Senator Glenn and others on 
that committee. They were very familiar with the IGs, and they 
had a process in place that they were constantly, every time an 
IG semi-annual report came out, some staff person on that 
committee was responsible for reviewing each and every--they 
had different agencies' reports. They looked at those reports. 
They looked at what was in there.
    Nowadays there is even more to look at because the IGs, 
they used to just list summaries of cases; now they actually 
identify most of them, what the biggest problems at these 
agencies and departments are.
    If Congress uses that as a tool for their own oversight, 
they can engage the IGs and they can be interested and 
attentive to what is going on, and it will force the IGs to do, 
in my view, more professional work, more thorough work, and 
remain objective, because Congress is going to look at it 
slightly different than the Department does. The Department 
obviously is trying to, in their natural course of things, is 
going to try and protect the department's interest. Congress 
tends to have a bigger and broader view of oversight for the 
Federal Government as a whole. I think you need both of those 
viewpoints, and the IGs to be independent need to have Congress 
engaged enough to insist that they are allowed to do the job 
they are supposed to be doing.
    Mr. Towns. Thank you very much.
    Starting with you, Mr. Steinhoff, and going this way, do 
you support a term of office, set date and time?
    Mr. Kaiser. I think there are pros and cons to it. The 
panel that we had generally did not support it. I agree with 
Mr. Mead that it would not hurt, but there are certainly other 
ways for an IG to be fully independent, and there are, I think, 
some operational issues with terms of office for that many 
people and the process that would, in fact, go through.
    One of the issues that the panel that GAO raised was that 
the provisions of the bill didn't really deal with whether the 
IG was incumbent or not. Did they have the basic competence to 
do the job? Were they doing a bad job? They felt there were 
other mechanisms to deal with the removal issues.
    I think the provision to provide for advanced notice, let's 
say 30 days in advance, whatever the timeframe you wanted to 
select, would, in fact, provide that protection.
    Mr. Towns. Ms. Tinsley.
    Ms. Tinsley. Well, I was part of the GAO panel, actually, 
and pretty much agree with what Jeff said. I don't like the 
idea of term limits, although I could argue term limits. You 
can argue. It is easy to argue both sides of that. It is hard 
to decide what the right answer is. Obviously, you shouldn't 
ask an IG to leave for the wrong reason; at the same time, if 
the administration asks you to leave, I think it might be 
difficult for an IG to be effective, because it is all about 
convincing the agency to make improvements to its programs and 
operations, and if that agency does not have faith in you it is 
going to be hard to be effective. So I think 30 day notice 
might be a better approach.
    Mr. Towns. But we are talking about independence. How do we 
get there? I mean, if he knows or she knows that the agency 
could just sort of move them on, or they have no really--you 
know, I am looking at the whole thing in terms of the fact that 
you can't be too comfortable if you know that they can just 
move you out. So a certain amount of time would sort of give 
you a certain amount of protection and independence, wouldn't 
it?
    Ms. Tinsley. You know, like Ken, I served for two 
administrations, and there have been a number of Administrators 
at the Environmental Protection Agency, particularly during 
this administration. I believe that our office issued some very 
hard-hitting reports while I was the Inspector General, and I 
did not--and even though I said things to the Administrator 
that were not popular, I did not ever have a problem with being 
concerned that I was going to be asked to leave because I was 
writing hard-hitting reports. So I think it is, in part, an 
issue with perhaps the integrity of the agency head, in 
addition to the IG, and I think that if you pick someone for 
the job who isn't well vetted and who turns out to not be an 
IG, there needs to be a way to ask that person to leave.
    Mr. Towns. Yes.
    Mr. Mead.
    Mr. Mead. If you fix the pay, you might be able to go, I 
think, the 7-year or 9 year term. I don't think it would hurt. 
If you are not going to fix the pay, I don't know the type of 
people that can stay in those jobs for seven or 9 years at the 
current pay. Anyway, I won't go further on that.
    I think the most important thing is, though, as Ms. Tinsley 
and others have said, the IG needs some protection that if you 
are coming out with a very unpopular, painful finding and 
recommendation, you don't want to be in peril of losing your 
position over that.
    Another thing on the term limits, sir, is when you come up 
toward the end, if it is renewable term, I don't want to see 
situations where the IG has to feel he is on good behavior for 
3 years, so I am not really a big fan or renewable terms.
    On the other hand, I am not a fan of the Comptroller 
General's term. It seems like a very long time to me. Mr. 
Walker, Mr. Ballard sure wouldn't go that far, but 15 years is 
a big chunk of time for one particular job.
    Mr. Steinhoff. For the record, I am supportive of that. 
[Laughter.]
    Mr. Towns. Ms. Hill.
    Ms. Hill. Yes, I do support the term limits. The classic 
example--and it is a little closer to the 7-years. The 
Comptroller is 15--is the Director of the FBI. That seems to 
have worked reasonably well over the years. You don't hear a 
lot of complaints, maybe some but not too many, about the 
politicization of the FBI any more.
    My problem with the 30 day notice idea is that if you tell 
Congress, what is Congress going to do about this in 30 days. 
It is not always easy for Congress to react. That is also an 
issue with the provisions on the cause. I think I support that. 
I think it is a good idea to have cause for removal, but you 
have to anticipate down the line what happens once that 
happens.
    Say the President decides he is going to remove somebody 
for what he thinks meets one of those terms. He notifies 
Congress. Congress may disagree that it is the same. They may 
not view the definition in the same way. Then what do you do? 
Does Congress have the right to cut that off somehow? If so, 
how? Does the individual have the right to bring a cause of 
action in a court to stop the termination?
    So I think, as far as the act goes, as far as the bill 
goes, it is a good idea, but as a practical matter, if that 
ever happens you are going to have issues raised about now 
what. What do we do? And the same thing I think would happen 
with this 30 day to the Hill, because what would Congress do to 
prevent that. If they wanted to stop it, then what?
    That is why I would support the term limit.
    Mr. Towns. Right. Thank you very much.
    I yield to the ranking member, Mr. Bilbray.
    Mr. Bilbray. Thank you, Mr. Chairman.
    Mr. Chairman, last year marked my 30th year in government, 
in management of government. Going through the steps, being a 
mayor at 27 and administering a county of over 3 million 6 
years later, there has been a lot of oversight and a lot of 
this kind of auditing going on, and so some of these things are 
sort of interesting.
    Mr. Kaiser, you were talking about a how many year term? 
One year term, no renewal?
    Mr. Kaiser. Seven year term as it was provided here, with 
reappointment possible. The Comptroller General has the 15 year 
term that is non-renewable. FBI Director is 10 years, non-
renewable.
    Mr. Bilbray. You know, as somebody who spends a lot of time 
in Mexico, I see what term limits have done there. My question 
is: doesn't that make the lame duck syndrome, immediately makes 
it a 7-year lame duck rather than maybe a shorter period?
    Mr. Kaiser. It would in the sense that, especially as you 
get closer to the end of that term, once a person enters the 
office at 7 or 10 or 15 years they have longevity ahead of 
them; however, when you get close to the end, that person's 
influence probably wanes at that point, yes.
    Mr. Bilbray. And the eyes may wander, shopping for the next 
step. And I only have to say, Mr. Chairman, I want to clarify 
that my comments are not in any way in opposition or reflecting 
support or opposition of H.R. 928. I think that it is a good 
framework to start discussing changes.
    Ms. Hill, you used a reference to the FBI Director. Now 
let's be very frank. It is a lot different. The FBI Director, 
wouldn't you agree, is an apex, is really a culmination of a 
career, law enforcement career, to be something that you would 
shoot for and know that this was the golden ring that you were 
grabbing for, and thus knowing that when you took this job that 
would probably be the end of most of your aggressive 
professional life?
    Ms. Hill. Well, that is true, but I still think it helps 
the independence a little bit. I mean, you know, in the IGs, 
you know, there is a great variety in the type of people who 
become IGs. There is the statutory requirements, and there are 
certain career professionals, there are people with auditing 
experience, investigation experience, etc., so you have a wider 
range of types.
    I am not a big, big fan of term limits, but I think in the 
idea of the IG's situation you do need as much protection and 
independence as you can get, as long as you maintain your 
accountability, because that is such a unique job. It really is 
a unique job in the Federal Government.
    Mr. Bilbray. My concern, though, is when you hit this what 
some of us may not say is top management and put term limits 
there, you get two types of candidates: one, those who 
basically are looking for a way to basically close out their 
career, and the other is a hotshot young candidate----
    Ms. Hill. Right.
    Mr. Bilbray [continuing]. Who may be looking at this to 
create a name and jump to another post. But that jump may be 
reflecting a certain industry over here or a certain agency 
over there, and may effect the proficiency. So I think there is 
a flip side here, wouldn't you agree, that you need to look at 
this seriously. This may have unintended----
    Ms. Hill. I agree you should definitely look at it 
seriously. I mean, one option would be consider maybe a 
slightly lesser term and stagger it. I mean, the issue now is 
the terms. To the effect there are imaginary terms, it goes 
with the administration, and maybe stagger it so that you get 
some--you know, keep some independence there.
    Mr. Bilbray. I think, obviously, with the legislation posed 
it is going to end up having some staggering.
    Ms. Hill. Right.
    Mr. Bilbray. I think in reality, from experience, we know 
that even political appointments are staggered because 
administrations coming in don't get around to it. I mean, in 
fact, many appointments are not really addressed until almost 
the second part of the term.
    Ms. Hill. Right. And the IGs, that has been a problem with 
IG appointments, because, at least years ago, I think they were 
not always the first ones to get appointed, and there were some 
IG positions, including the one at Defense, that were vacant 
for a long period of time or had acting people in them, which 
is not a good thing, either, because my view of that is that 
decreases the amount of practical independence they have. It is 
not an appointed----
    Mr. Bilbray. Thank you, Ms. Hill. I think the point is that 
if we stagger it, we stagger it in between, in reality it 
probably will not only help to keep the continuity, but I think 
also will help the administration sort of concentrate on those 
appointments that they might be able to get appointed in time 
and on schedule.
    Ms. Tinsley, first of all let me warn you I was raised by 
an accountant and I married an accountant. That is probably why 
I am so disorganized. No, actually, I married her because I was 
so disorganized.
    You were an accountant when you were selected for your 
position to IG. Do you see that as being a critical talent when 
reviewing the EPA, or do you see it as a beneficial one? How 
would you judge that in there? And do you think that credential 
is very important at agencies like EPA, or would other 
credentials do you think would be more effective?
    Ms. Tinsley. I think that the talent that a person should 
have would analytical ability. You don't have to be a CPA to 
have analytical ability. In fact, many would say that most of 
them don't. But I also think that you need to have management 
and leadership skills. I think that is key, regardless of your 
background, although the career fields that the IG Act 
specifies equate to the kind of work Offices of Inspector 
General do, and it makes sense to me to bring someone into that 
position that understands the kind of work they are going to be 
doing, because they are leading an organization that is going 
to be making important recommendations.
    Mr. Bilbray. Thank you.
    Let me for the record point out that both my mother and my 
wife agree that I will never balance the budget because I can't 
even balance my own checkbook. [Laughter.]
    I yield back, Mr. Chairman.
    Mr. Towns. Thank you very much.
    I yield to Mr. Cooper.
    Mr. Cooper. Thank you very much, Mr. Chairman.
    I think, as my colleagues can see, we have tried to come to 
a reasonable compromise between differing points of view, but 
it is hard to please everyone. In fact, sometimes it is 
impossible. But I think, as my colleagues will realize, when a 
Presidentially appointed IG can be removed for any reason, an 
agency appointed IG can be removed for any reason, that really 
gives you slender comfort. Here on this panel we have some of 
the more successful IGs. You have had good relationships with 
multiple administrations.
    Our job is to legislate for all circumstances, and that is 
why I think many of us on this side of the table, being elected 
to terms, we are accustomed to terms, and that gives us some 
comfort. Many IGs have never known that comfort, and there are 
pros and cons on anything.
    But I share Ms. Hill's concern. What will Congress do with 
the information of 30 day advance notice? It seems like, at a 
bare minimum, we have to put some sort of for-cause in there to 
protect IGs' independence.
    We always want accountability, but we are trying to find 
that right balance. Perhaps someone will deliver the magic 
formula that will make everyone happy, but my goal is to move 
reasonable legislation, because, as I noted earlier, it has 
been 4 or 5 years. That is 4 or 5 years that IGs have lacked 
the pay equity and the independence and the protections that I 
think we can all agree on, so let's not let the best be the 
enemy of the good here.
    I know our colleagues on the other side of the aisle will 
have useful suggestions to make. The key is to protect the IGs 
out there who are catching the bad guys, who are saving the 
taxpayer dollars.
    It is really a marvelous, good news story. There are so few 
good news stories about Government sometimes, but I think it is 
very important that we focus on the productive work that IGs 
are doing and thank goodness that they are, and hopefully we 
can attract even, you know, more qualified IGs and protect them 
so that they can do that good work.
    That is my goal, and I appreciate hearing so much expert 
testimony on this, including the constitutional provisions that 
we need to be aware of so that we make sure that we stay within 
our constitutional bounds, because no one can predict which 
party will control which branch. We need this law to work for 
all circumstances.
    I thank you, Mr. Chairman, for holding this hearing.
    Mr. Towns. Thank you very much. And I thank you for the 
work that you are doing on it. I think it is so important that 
you talk to as many people as you possibly can before moving 
forward what you are doing.
    Mr. Miller.
    Mr. Miller. Thank you, Mr. Chairman.
    Ms. Hill said that Congress should be more involved in the 
oversight of Inspectors General, not just using the Inspectors 
General work as a tool for oversight of the entire Federal 
Government, but actually involved in the oversight of 
Inspectors General.
    Ms. Hill. What I mean is that they should be attentive to 
what IGs are doing. They should not hesitate if there are 
issues in those departments that they think the IG should be 
looking at, to request the IGs to look at them and to look at 
what they are finding, so that, you know, that the IGs, when 
they are doing an inquiry, they know that not only is the head 
of the department going to be paying attention to it, but the 
Congress is going to be paying attention to it, and therefore 
they are going to do their best to make that an objective, 
fact-based inquiry.
    Mr. Miller. Well, in the spirit of Congress providing 
oversight of the Inspectors General, when I asked a question to 
Mr. Johnson earlier he said that it was not true that Mr. 
O'Keefe had picked Mr. Cobb to be the Inspector General of 
NASA, but that came from the interviews conducted by the 
Integrity Committee, itself, and specifically from the 
interview of Courtney Alexander Stadd, S-T-A-D-D, who was the 
chief of staff to Sean O'Keefe at NASA and the White House 
liaison there.
    According to a memorandum of the interview of PCIE staff, 
which I guess was a HUD Inspector General that conducted the 
report, staff said that O'Keefe had wanted to replace Roberta 
Gross, the previous IG, from the outset, and staff advised that 
O'Keefe interacted with Cobb when Cobb was working at the White 
House and O'Keefe was at Office of Management and Budget. That 
was how they got to know each other, as Cobb handled the ethics 
evaluation for political appointees when he was at the White 
House. O'Keefe asked Stadd to contact Cobb and inquire if he 
was interested in the IG's position at NASA. This was when the 
position was not yet vacant, was still filled by Roberta Gross.
    Stadd contacted Cobb. Cobb seemed interested. Stadd 
indicated ``he thought it was unusual that O'Keefe had a say in 
who the next IG would be.'' Stadd did not know the procedure 
for Cobb to apply for a position not yet vacant.
    Does that also strike you as an unusual way to pick an IG?
    Ms. Hill. Well, again, I don't know the facts of that case, 
so I can't really comment on an individual case.
    Mr. Miller. For an agency head to pick the replacement--
first of all, decide that the IG needs to be replaced, and then 
pick the replacement, Mr. Mead, how does that affect the 
independence of the IG?
    Mr. Mead. Well, I imagine there was multiple input. I am 
not familiar with the facts of this case, so I am not going to 
opine on that, but it strikes me that the selection process for 
IGs, that it is in your interest, I think it is in the interest 
of the executive branch for the President to have a pool of 
candidates. I pointed out I think GAO is a good source of 
candidates. I don't think it is unusual at all for an agency 
head to be asked their thoughts about whether they have a 
particular candidate in mind.
    I am really only aware of my own case and how I got to be 
IG. I didn't know the Secretary. I think my name was dropped in 
a hat by somebody from GAO that knew somebody in White House 
personnel. Beyond that, though, I really can't get into it.
    Mr. Miller. Ms. Tinsley, do you have anything to say on 
this point? You don't have to if you don't want to.
    [No response.]
    Mr. Miller. Also from the PCIE report--and I talked about 
this earlier--the report of investigation found that Cobb 
frequently joined O'Keefe in lunches intended for senior staff 
at NASA headquarters, played golf on at least two occasions 
with Administrator O'Keefe, joined O'Keefe on the NASA aircraft 
for official travel on several occasions. Our committee has 
gotten tips from NASA employees that they believe that Mr. 
O'Keefe flew in the NASA plane when regulations of how the 
plane could be used would have required that he fly 
commercially.
    Those tips apparently didn't go to the Inspector General of 
NASA, they came to us, the Oversight Committee, perhaps because 
Mr. Cobb was on the plane with him. He referred to Mr. O'Keefe 
as his boss, sought guidance from the Administrator on the 
audit design for at least two audits, sought O'Keefe's review 
of draft OIG opinion regarding the independence of the Columbia 
Accident Investigation Board. That was the shuttle that was 
destroyed on re-entry. He advised O'Keefe about search warrants 
to be issued and the significant criminal investigation before 
those warrants were executed.
    The PCIE report concluded that none of these instances 
standing alone is sufficient to create an appearance problem, 
but it is the responsibility of the IG to consider how the 
combined effect of this interaction with the agency head might 
cloud or be perceived to cloud his independence.
    Then the report goes on to talk about two specific 
instances where Mr. Cobb had prevented NASA from reporting 
apparent criminal conduct to law enforcement agencies and found 
that those two agencies created further the appearance of a 
lack of independence.
    What is your own view as from the experience of the 
Inspector General of the propriety of this combined, this 
cumulative effect of an appearance, Ms. Hill?
    Ms. Hill. Again, I am a stickler for detail and fact, and I 
am very reluctant to comment on facts where I haven't read all 
the reports and know all of the----
    Mr. Miller. What is your opinion?
    Ms. Hill. But I will tell you that, you know, IGs live in 
glass houses. I have always thought that. And you have to be 
very careful about appearance, so I would just say that, you 
know, I can only--as Ken said, I can only speak for my own 
personal experience, and I always tried to be very careful and 
keep not just the legal line but the appearance issue in mind, 
because people do look at you and you have to, you know, do 
what you think is best and effective in the agency, but also 
keep in mind that you are supposed to be independent.
    That probably is not really answering your question, but, 
again, you know, I feel very uncomfortable commenting on facts 
that I do not really--I haven't seen the reports. I haven't 
read the material. I don't know what happened, what didn't 
happen in that case.
    Mr. Towns. Thank you very much, Mr. Miller.
    I would like to put the opening statement from Congressman 
Davis into the record. Without objection, so moved.
    Let me thank all of you for your testimony. I think that 
you have been extremely helpful. As you can see, this is an 
issue that we really, really want your input on, because we 
think that something needs to be done, and, of course, 
Congressman Cooper is moving in the right direction. I think 
that his openness to soliciting to get additional information, 
input coming from both the Members and from you and others as 
witnesses, I think indicates how serious he is about doing 
something about the problem.
    Of course, I agree with you. I think the appearance is 
something that we have to address. I mean, we just cannot 
ignore that. Of course, the salary, I think that is an issue 
and I think these are all the kind of things that we hope to be 
able to address before the end.
    Thank you very much for your testimony, again. We look 
forward to working with you.
    Thank you.
    [Whereupon, at 4:18 p.m., the subcommittee was adjourned.]
    [The prepared statement of Hon. Tom Davis and additional 
information submitted for the hearing record follow:]
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