BBG Watch Commentary

Audit of the Broadcasting Board of Governors Administration and Oversight of Acquisition FunctionsBBG Watch reposts a commentary by AFGE Local 1812. It deals with employment of private contractors by officials of the Broadcasting Board of Governors (BBG). The Office of Inspector General (OIG) determined that executives, who were and some of whom are still in charge of the International Broadcasting Bureau (IBB), the Voice of America (VOA), and the Office of Cuba Broadcasting (OCB), had hired 663 contractors, 600+ above the statutory authorized number in an alleged violation of the Anti-Deficiency Act (ADA). This problem affects only the federal part of the agency. Non-federal BBG grantees — Radio Free Europe / Radio Liberty (RFE/RL), Radio Free Asia (RFA), and the Middle East Broadcasting Networks (MBN) — are better managed and have the proper authority to hire contract employees.

Some of the federal BBG/IBB/VOA/OCB executives are no longer with the agency, but others have found a way to continue essentially the same practice by proposing to hire contractors through two outside private firms instead of hiring them directly. This will further weaken already extremely weak supervision of the hiring process and of the knowledge of the programs being produced while continuing shameful exploitation of contract employees by denying them decent pay, benefits, and employment protections. This move will further undermine record low employee morale (as measured by OPM, the Office of Personnel Management for federal employees) for both federal employees and contract employees (OPM does not measure employee morale among contractors).

Federal Acquisition Regulation (FAR) 37.104(b) prohibits the use of personal services contracts if a federal agency does not have an explicit statutory authority, which IBB did not have above the 60 contracts limit.

OIG found that among some 660 contracts identified as possibly done for personal services, a little over 40 were classified as personal services contracts while more than 600 may have been inappropriately described as non-personal services contracts or not defined by IBB officials in any way. OIG alleges that many of these inappropriately described or non-defined IBB contracts may be identical to those described as personal services contracts.

It is no secret that at this important U.S. government agency, officials no longer know who is doing news reporting and program production deemed critical for U.S. national interests and security. Recent examples include posting a map on the Voice of America (VOA) website showing Crimea to be part of Russia and producing a VOA promo video for Pakistan showing a blood thirsty zombie dressed as Uncle Sam attacking a Pakistani.

U.S. diplomats who represent the country abroad are carefully tested and screened and their work is closely watched and evaluated. The State Department also employs private contractors, but they are not assigned critical tasks and do not act as direct representatives of the United States. Contractors working at the Voice of America report news and act directly on behalf of the United States everyday. They are for all practical purposes U.S. government employees doing highly critical and highly sensitive work. VOA and IBB executives, who spent most of their time writing memos, sending out emails, attending meetings, writing self-glorifying press releases and taking long lunches and coffee breaks, often have no idea who does this work and what is being produced.

It is also no secret that the hiring of a large number of contractors has allowed the IBB, VOA, and OCB bureaucracy to expand while programs and programming positions were being cut. IBB will fight to keep its bloated bureaucracy even as Congress and Andy Lack, a respected media executive and journalist chosen by the BBG to be the agency’s new CEO, may have other ideas. The latest move by the bureaucracy was no doubt designed to prevent the CEO from making his own evaluation and making his own decision on the issue of contractors once he assumes his position, which may not be for several weeks.

AFGE Local 1812

AFGE Local 1812 Quoted in Government Executive Article

A staff-wide memo from IBB, released on September 30, announced that the BBG, in a supposed need to “change our business culture to better reflect the importance” of the 600+ illegally-hired contractors at VOA, had hired two firms to “directly employ or subcontract with the contractors fulfilling technical and broadcast services for the BBG”.

That memo was the subject of an article published in Government Executive on October 8 in which AFGE Local 1812 was quoted extensively. In addition, Government Executive cited a July 2014 article posted on the AFGE Local 1812 website entitled “Are VOA Contractors Really Employees?”, in which the Local traced the history of contracting-out at the Agency, discussed the damning OIG report conducted in 2012-2013 regarding the Agency’s contract procedures and the Union’s contention that contracting-out was a back-door to de-federalization of the Agency.


Government Executive approached the Union for comments on the September IBB outsourcing memo and a Union spokesperson responded. The article states: “Asked recently to comment on the new outsourcing plan, an AFGE Local 1812 spokesman said the BBG ‘has been forced into changing its policy regarding individual contractors as a direct result of investigations by the Internal Revenue Service and the Office of the Inspector General, both of which uncovered improper contracting practices’.”

Further, the article said: “The union views the past use of individual contractors, as well as moving a large number of contractors under the umbrella of the two selected firms, as continuing an improper conversion of federal employee functions to the private sector, continuing with the statement that individual contractors have been, and will be, performing much the same services as federal employees at the agency; the contractors’ work has been supervised in parallel fashion to federal employees.”

Over the past decade, contractors have contacted AFGE Local 1812 for help with their situation although the Union does not represent any current BBG contractors and could not take action. Contractors also appealed to BBG board member Victor Ashe, who has since retired. We do not know whether or not contractors also appealed to the Congress about their situation.

AFGE Local 1812 was further quoted in the Government Executive article: “The best resolution to this improper use of contractors at the BBG and the end of this scandal would be for the agency to admit wrongdoing and do what should have been done in the first place, hire the employee-paralleling contractors into the Federal Civil Service.”

None of this is any surprise as the Local has been fighting the contracting-out debacle for many years. The Agency consistently rebuffed the Union on even the actual number of contractors employed by the Agency. Only in September 2013, in the preliminary OIG report did the Union find out that the actual number was 663 contractors, 600+ above the statutory authorized number.

The Union takes issue with what seems to be a disingenuous explanation offered by the Agency spokeswoman regarding the timeline on the resolution of this contracting-out fiasco. OIG conducted its investigation and audit in 2012-13. A preliminary report of the contracting-out irregularities and violations was submitted in September 2013.

Although the Agency had this report, it essentially did nothing to confront the monumental problems. Silence reigned. Then, IBB Director, Richard Lobo, announced his retirement in November 2013 followed by the retirement of the Director of Contracts in December 2013. Months went by. In April 2014, the contracting-out issue was spotlighted in the Findings and Declarations section of HR 4490, the broadcasting reform legislation passed unanimously by the House Committee on Foreign Affairs and when it went to the floor, was passed unanimously by the full House. After input from the Agency, the final OIG report on contracting-out at the BBG was published in June 2014.


The Agency’s quick-fix Band-Aid “solution” to the serious contracting-out problems, including violations of IRS rules on classification of workers (Agency management has apparently not addressed how they plan to rectify the problem with the IRS), multiple violations of the Anti-Deficiency Act and the Federal Acquisition regulations, is unsatisfactory. Curiously, there does not seem to be any real punishment for those who initiated and continued this shocking waste, fraud and abuse.

The Agency’s “solution” — hire contractors, albeit with a buffer of several outside firms — only complicates the problem. Of course, the Union’s solution — to provide a pathway for contractors to become full-time employees with benefits including sick and annual leave and retirement benefits — is considered to be much too radical, when, in fact, it is the best solution of all.

To see the full Government Executive article, click below: