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Obama’s Americorps scandal — and the First Lady’s meddling

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By Michelle Malkin  •  June 12, 2009 09:43 AM

President Obama is hoping you won’t notice his abrupt change of inspectors general over at Americorps, the government-run, taxpayer-subsidized “community service” boondoggle (which Republicans helped expand as part of the $6 billion GIVE/SERVE Act in March despite its wasteful track record. Thanks, Republicans).

With intervention from Michelle Obama, the Americorps inspector general was given the boot and replaced — for doing his job too well, it seems, and uncovering squandering of funds by favored contributors, educational institutions, and left-wing groups.

This Associated Press article only scratches the surface:

President Barack Obama plans to fire the inspector general who investigates AmeriCorps and other national service programs amid a controversy between the IG and Sacramento Mayor Kevin Johnson, who is an Obama supporter and former NBA basketball star.

The IG, Gerald Walpin, was criticized by the U.S. attorney in Sacramento for the way he handled an investigation of Johnson and his nonprofit group, St. HOPE Academy, which received hundreds of thousands of dollars in federal grants from the Corporation for National Community Service. The corporation runs the AmeriCorps program.

On Thursday, Obama said in a letter to Congress that he had lost confidence in Walpin. Neither the president nor deputy White House press secretary Josh Earnest would give details. The president must give Congress 30 days’ notice before removing Walpin, who is being suspended with pay for the 30 days. Earnest said, “The president will appoint a replacement in whom he has full confidence as the corporation carries out its important mission.”

Sen. Chuck Grassley, R-Iowa, in a letter to Obama, pointed to a law requiring that Congress be given the reasons an IG is fired. He cited a Senate report saying the requirement is designed to ensure that inspectors general are not removed for political reasons. Grassley said Walpin had identified millions of dollars in AmeriCorps funds that were wasted or misspent and “it appears he has been doing a good job.”

In fact, there’s much more.

This little-noticed story in Youth Today yesterday points to another example of Walpin blowing the whistle on fraud:

The inspector general (IG) of the Corporation for National and Community Service is being removed by President Barack Obama, a week after the IG questioned the eligibility of the largest and most expensive AmeriCorps program, and while the IG was contesting the “propriety” of a settlement made with a mayor for alleged misuse of AmeriCorps funds.

Funding for the largest AmeriCorps program – the Teaching Fellows Program, run by the Research Foundation of the City University of New York – is in abeyance pending resolution of widespread problems identified in a recent audit. Although Walpin recommended that funding be curtailed and that previous funds (perhaps as much as $75 million) be repaid to the corporation, the corporation has said it will take no action on that matter.

Walpin concluded that nothing was being gained by the grants to CUNY and that the money was simply being used to subsidize an existing and funded program.

I highly recommend that you head over to the Americorps’ inspector general’s report site here. You can find the entire CUNY report here. Let me repeat what the IG found: Waste, duplication, ineffective spending, criminal background check lapses, and repeated violations of the grant rules. And they’re not doing anything about it. Just a snippet from the executive summary:

The Office of Inspector General (OIG), Corporation for National and Community Service (Corporation), contracted with Cotton & Company LLP to perform agreed-upon procedures to assist the OIG in grant cost and compliance testing of Corporation-funded Federal assistance provided to The Research Foundation of the City University of New York (RFCUNY). The Corporation awarded two Education Award Program grants to RFCUNY that were categorized as Professional Model grants.

SUMMARY OF RESULTS

As a result of applying our procedures, we questioned education awards of $16,152,414 and draw downs of $773,254. In general, we questioned the education awards for members whose eligibility was not established in accordance with grant requirements for criminal background checks. Draw downs were questioned mostly for fixed fees related to members whose eligibility we questioned and also for drawing down in excess of fees earned. In addition, our compliance findings when taken as a whole indicate pervasive problems of eligibility, timekeeping, and documentation. A questioned cost is an alleged violation of a provision of law, regulation, contract, grant, cooperative agreement, or other agreement or document governing the expenditure of funds or a finding that, at the time of testing,
includes costs not supported by adequate documentation.

…Participants who successfully complete terms of service under AmeriCorps grants are eligible for education awards and, in some cases, accrued interest awards funded by the Corporation’s National Service Trust. These award amounts are not funded by Corporation grants and thus are not included in claimed grant costs. But at the time that a grant is awarded, and due to the grant award, these amounts become immediate obligations of the National Service Trust. Therefore, as part of our agreed-upon procedures, and using the same criteria used for the grantee’s claimed costs, we determined the effect of our findings on AmeriCorps members’ entitlement to education and accrued interest awards.

The following is a summary of grant compliance testing results…

1. RFCUNY drew down more funds than it was due.

2. RFCUNY did not follow certain AmeriCorps Provisions.

3. The supervisory signature on members’ timesheets was not the members’ supervisor, or that of someone with direct knowledge of hours served by the members.

4. Members did not always record actual service hours on their timesheets.

5. Some members’ timesheet hours were not accurately recorded in the Corporation’s Web-Based Reporting System.

6. RFCUNY did not require its members to timely submit their member contracts, forms, and timesheets.

7. RFCUNY used preprinted member documentation and did not ensure that all member documentation was completed, signed, and dated.

8. RFCUNY did not maintain documentation to demonstrate that each member’s evaluation complied with AmeriCorps Regulations and the Member Agreement.

9. RFCUNY did not maintain documentation to demonstrate that members received criminal background checks and that any background checks conducted complied with AmeriCorps Provisions.

10. RFCUNY entered incorrect member start dates in Corporation systems and in member contracts.

11. Some members worked beyond their contract-end date.

Another recent IG report on Americorps waste by open-borders lobbying group, La Raza (“The Race”) spotlighted its failure to complete background checks and institute secure financial controls. And on and on and on.

And guess who’s meddling in these affairs? Yep, First Lady Michelle Obama:

Some decisions about CNCS are being made by First Lady Michelle Obama, according to service advocates (who asked not to be named). Last week, Mrs. Obama announced that her chief of staff, Jackie Norris, would move to CNCS as a senior adviser. Officials said yesterday that Norris is scheduled to arrive on June 22.

Who’s looking out for you now? Cronies, that’s who.

More on the First Lady’s role in installing Norris and intervening to help pick the next Americorps CEO:

First Lady Michelle Obama’s chief of staff, Jackie Norris, is being sent to the Corporation for National and Community Service (CNCS) in what is both a White House shake-up and an indication of the first lady’s sway over the corporation that oversees AmeriCorps, Serve and Learn and the Senior Corps.

Observers believe Norris, whom Obama came to know early in the Iowa caucus campaign, was forced out of the White House so that long-time Obama friend Susan Sher could take over. But those same observers see her appointment as senior adviser to the corporation as an overall win for CNCS, believing that Norris still will have a straight line to the White House.

CNCS remains without a CEO after the withdrawal last month of Nike vice president Maria Eitel, even before her nomination went to the Senate. Although the corporation’s CEO must be nominated by the president and confirmed by the Senate, Michelle Obama reportedly has taken the lead in selecting the nominee.

This stinks. Shades of Travelgate, anyone?

The more things Change…

***

Ed Morrissey: “Will Congress stand up to the executive branch and protect the Inspectors General? Or will they roll over and allow Obama to accrue even more power to protect his buddies and to allow corruption to run rampant?”

***

Flashback on the Americorps/ACORN fraud history, circa 2004:

Although ACORN’s projects run a wide gamut, the group claims as its purpose helping low- and middle-income Americans — through initiatives ranging from improving urban public schools, to providing counseling on how to avoid “predatory lending,” to increasing the availability of “affordable housing.” Most of these programs are conducted locally, by state-level ACORN organizations — which are often set up as 501(c)3 nonprofit entities distinct from the national ACORN umbrella, a 501(c)4 lobbying organization. Sounds benign enough — except that, according to Bob Huberty, executive vice president of the Capital Research Center, these tax-exempt 501(c)3s “have no reason for existence other than to get grants from the government and foundations.” They are, essentially, an ACORN front for asking Uncle Sam to subsidize political activity.

Ask ACORN does — and it definitely receives. Take, for example, the most recent tax information from one of ACORN’s subsidiary nonprofits: the ACORN Housing Corporation, Inc., based out of the organization’s national headquarters in New Orleans. For the tax year beginning July 1, 2002, and ending June 30, 2003, ACORN Housing Corp.’s 990 Form shows a total of $1,710,203 received in government grants (the year before, the total was $1,977,306).

The nominal purpose of those millions is to “provide low rent housing & loan counseling services to low income individuals.” But if the government is funding the actual, legitimate work of ACORN at the local 501(c)3 level, it means that the national lobbying organization can dedicate more of its unrestricted resources to electioneering. Furthermore, explains Craig Garthwaite, director of research at the Employment Policies Institute, “The funding is not only fungible in that if they receive money for X, they can spend more on Y.” He cites one particular example of money-rerouting malfeasance: the crooked dealings surrounding an AmeriCorps grant in 1996. According to an EPI study, when the ACORN Housing Corp. applied for the grant, they denied any connections to the main ACORN lobbying group (the grant is not for political advocacy). But the AmeriCorps inspector general discovered that “not only was AHC created by ACORN, engaged in numerous transactions with one another, and sharing staff and office space — but it utilized the AmeriCorps grant to increase ACORN membership, a violation of federal guidelines.” (ACORN charges membership dues, much as labor unions do; thus, by exploiting AmeriCorps funding to inflate its membership rolls, ACORN used government resources to bring in even more money — money with no restrictions on its political use.)

***

And another relevant flashback on Michelle Obama’s interest in government-directed “service,” via IBD last fall:

Barack Obama was a founding member of the board of Public Allies in 1992, resigning before his wife became executive director of the Chicago chapter of Public Allies in 1993. Obama plans to use the nonprofit group, which he features on his campaign Web site, as the model for a national service corps. He calls his Orwellian program, “Universal Voluntary Public Service.”

Big Brother had nothing on the Obamas. They plan to herd American youth into government-funded reeducation camps where they’ll be brainwashed into thinking America is a racist, oppressive place in need of “social change.”

The pitch Public Allies makes on its Web site doesn’t seem all that radical. It promises to place young adults (18-30) in paid one-year “community leadership” positions with nonprofit or government agencies. They’ll also be required to attend weekly training workshops and three retreats.

In exchange, they’ll get a monthly stipend of up to $1,800, plus paid health and child care. They also get a post-service education award of $4,725 that can be used to pay off past student loans or fund future education.

But its real mission is to radicalize American youth and use them to bring about “social change” through threats, pressure, tension and confrontation — the tactics used by the father of community organizing, Saul “The Red” Alinsky…

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