October 2010                                     Issue #5

Contractors break the law, still get contracts

Join the call for public access to violations database

Federal contractors repeatedly violate laws on labor standards and workplace safety – and continue to win lucrative government contracts – a new GAO study found.

At the same time, major contractors have managed to stall public release of a database on their misconduct and illegal actions.  Congress has created a centralized, government-wide database on contractor responsibility, but the public and even most members of Congress can't access it.  

Letters are needed to support the call for public disclosure of the Federal Awardee Performance and Integrity Information System (FAPIIS).

Contractors have delayed the planned Internet posting of FAPIIS by arguing "that data on criminal or civil proceedings for contract violations … could give their competitors an unfair advantage," the Boston Globe reported. The Project on Government Oversight (POGO) and 14 other public interest organizations argue there's nothing unfair about denying contracts to law-breaking companies.

"We hand out over $500 billion a year to federal contractors, many of which have well-established histories of systemic illegal, fraudulent, and incompetent behavior," said Sen. Bernie Sanders of Vermont. "We cannot let these corporations continue to rip off American taxpayers."

The newest report from the Government Accountability Office (GAO) documents contractor violations of laws that ensure fair wages, workplace safety and the right to join unions. In a 2009 study, the GAO reported that many contractors continue to get lucrative contracts despite "egregious offenses" ranging from tax fraud to sabotaging a military aircraft carrier.

POGO has its own Federal Contractor Misconduct Database, which served as a model for the much-larger federal database. The nonprofit continues to advocate for expanding the scope of the project to include more kinds of misconduct and to go back farther than five years

Letters supporting public disclosure and expansion of the FAPIIS database can be sent to the following addresses:

The Honorable Martha N. Johnson
Administrator
General Services Administration
1800 F Street, NW
Washington, DC 20405
martha.johnson@gsa.gov

The Honorable Daniel I. Gordon
Administrator
Office of Federal Procurement Policy
1650 Pennsylvania Avenue, Room 412A
Washington, DC 20503
Daniel_Gordon@omb.eop.gov

Public tax-filing services in California survive assault by software companies

by Jean Ross, Executive Director, the California Budget Project

In one of the few bright spots in California’s recently enacted budget, attempts  to eliminate the state’s free tax-filing programs – CalFile and ReadyReturn – were defeated. Thanks for all of your help. This was a case where a little sunshine went a long ways toward preventing dark-of-night dirty deeds.

This battle, however, is far from over. Privatization proponents are already gearing up for next year. So we’ll be back on this before long. But for now, all is well.

Note: The last issue of In the Public Interest discussed the huge lobbying effort by companies that make tax-filing software to close down the state's free, online tax-filing services.

Recent Research

Analysis of Pittsburgh's Parking Assets
Finance Scholars Group, September 24, 2010. This report was prepared for the Pittsburgh City Council and The Parking Study Taskforce in order to consider the pros and cons of privatizing parking meters in the City of Pittsburgh. The report uses other cases of privatized parking meters to illustrate the benefits and costs, and provides an economic analysis for the consideration of privatization parking assets.

A Closer Look: Veolia Environnement
Food and Water Watch, September 2010. Veolia Water North America is the top private water services contractor in the United States. This fact sheet provides an overview of privatization failures from some of its largest contracts in Indianapolis, New Orleans, and Puerto Rico.

Control State Politics: Big Alcohol's Attempt to Dismantle Regulation State by State
Marin Institute, September 2010. This report discusses concerns raised by the privatization of the sale of alcohol and presents findings that it is more beneficial to keep the sale of alcohol as a state-regulated service.

Visit InThePublicInterest.org for more research, news, resources and case studies.