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USDA Official Transferred After Audit Finds Misuse of Research Funds

February 8, 1995

WASHINGTON (AP) _ The head of an Agriculture Department agency was removed from his job after auditors found that he misused $1.8 million by steering research contracts to friends and illegally using government money to lobby Congress, documents show.

The alleged abuses were outlined in an inspector general’s report, obtained by The Associated Press under the Freedom of Information Act, on operations of the Cooperative State Research Service, headed since 1983 by John Patrick Jordan.

Jordan, 60, a biochemist, was transferred in December to run the department’s Southern Regional Research Center in New Orleans.

At the time of the transfer, Jordan’s agency was being merged with another as part of a department reorganization. A letter that is part of the inspector general’s report, however, said that ``removing the administrator from his position will largely solve our problems.″

The allegations come to light as many fiscal conservatives are pressing for cuts in the department’s research budget, arguing that projects duplicate private or other government research.

The research service dispenses more than $400 million a year, mostly to state universities, for agricultural research and building projects. Most is awarded under competitive bidding for long-term agreements or through formulas set by law.

But a fraction of the money may be awarded without bidding when special, short-term funding is needed.

According to the internal USDA report, grants worth $22 million were made between 1987 and 1992 through 319 agreements under that special authority. The agreements created a mound of paperwork _ nearly 2,800 documents _ that received hardly any scrutiny, the report said.

The auditors reviewed 12 cases involving $7.8 million. They said Jordan awarded agreements in six cases worth $1.8 million to benefit his friends, pay for lobbying activities to increase research funding, or both.

``We identified three cases in which activities performed and paid for under noncompetitive agreements included lobbying for program funds,″ the report said. ``Here again, the administrator directed the duties of the individuals carrying out these agreements.″

Using federal money to lobby Congress has been forbidden since 1948. A 1989 law specified that grant money cannot be used to seek additional grants; regulations in 1992 clarified the law.

Regulations also prohibit gifts from people with business before the government and using government offices for personal gain.

In a telephone interview, Jordan denied any improper use of money, saying the investigators’ report was exaggerated. ``They always make it sound like you’ve been to hell and back,″ he said.

In one case cited by inspectors, a Jordan friend formed a company six months after Jordan had become agency chief. The company then received $640,000 worth of agreements from Jordan.

In another, Jordan arranged a job transfer of a department employee so he could retire in California. Upon retiring, the man received $149,200 worth of agreements.

Another friend received $622,570 worth of agreements from 1987-1993 to establish research priorities. Auditors said there was no evidence anyone had used the friend’s work in any research planning.

In one case, according to the report, a grant recipient helped Jordan write Encyclopaedia Britannica articles for which Jordan was paid. In another, Jordan received family portraits painted by the spouse of a friend after the couple had received money under agreements.

Nancy Bartel, spokesperson for the Office of Inspector General, said the agency was forbidden from commenting on whether Jordan was being investigated for possible criminal violations. She said, however, that steps had been taken to prevent future problems.

Jordan said he requested a new assignment last August because his old job was being written out of existence as part of a reorganization plan.

But a Sept. 6, 1994, letter from Jordan’s superior at the time, R.D. Plowman, to the inspectors said: ``We are also convinced that most of the problems identified in this audit were caused by a very aggressive and forceful administrator who influenced directly or indirectly the awarding of noncompetitive grants and agreements. We are also convinced that removing the administrator from his position will largely solve our problems.″

The department’s personnel office confirmed that Jordan was transferred Dec. 11.

Gene Spory, a department official and friend of Jordan’s who reviewed the agreements and prepared an agency response to the auditors, said he disagreed with the report.

``The bottom line was that corrective actions were taken and Dr. Jordan was reassigned to another function not based on the audit,″ he said, calling the findings of improper lobbying ``a matter of interpretation.″

Because of the complexity of agreements, with the same employees getting state and federal funds, determining whether federal money is used for lobbying is nearly impossible, he said.

The portraits of Jordan and his wife were given in 1993, six years after an agreement, when Jordan’s wife was dying of cancer, Spory said. ``It was an act of compassion and friendship,″ he said.

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