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Army Official Says Meese Meeting Crucial to Contract Award

February 1, 1988

WASHINGTON (AP) _ A 1982 meeting called by an aide to then-presidential counselor Edwin Meese III helped Wedtech Corp. get a no-bid contract the Army was unwilling to award, an Army procurement official testified today.

Assistant Army Secretary Jay Raymond Sculley, testifying at the illegal lobbying trial of former presidential aide Lyn Nofziger, said the May 19, 1982, meeting called by James E. Jenkins helped ″change the course″ of protracted contract negotiations.

″What changed really was the contributions of other federal agencies and the cost estimate from Welbilt,″ Sculley said, referring to Wedtech by its previous name, Welbilt Electronic Die Corp.

Wedtech reduced its price and found financing from other government agencies to bridge the cost gap, Sculley said.

Nofziger, the former White House political director, is charged with four counts of improperly lobbying former colleagues on Reagan’s staff in 1982 for Wedtech and two other clients.

His business partner, Mark A. Bragg, 42, is charged with aiding and abetting one of the contacts. Each charge carries a two-year sentences and a $10,000 fine.

At the meeting, Sculley said the Army was unwilling to pay Wedtech’s asking price of $39 million for the engines and had already decided to withdraw the procurement from a special program for minority businesses.

Sculley said he defended the Army’s cost estimate of $24 million.

Jenkins and others stressed that ″the placement of this contract in the South Bronx would provide livelihood to a large number of people and keep a campaign promise″ by President Reagan to help the economically devastated section of New York City, where Wedtech was located, Sculley said.

Afterward, Sculley said:

″I was somewhat skeptical whether or not Welbilt could come down from their nearly $39 million estimate. That seemed to be the biggest obstacle to an agreement.″

Wedtech did reduce its offer and was able to win the $32 million no-bid contract with financing from the Small Business Administration and other government agencies that helped the minority-owned business.

Sculley said the Army Secretary John O. Marsh Jr. and other top officials decided on March 29, 1982, to withdraw the engine contract from the SBA’s program for minority businesses because Wedtech’s price was too high.

That decision was reaffirmed at a meeting in mid-April, Sculley said, but was never formally implemented by Marsh.

Among the allegations against Nofziger is a charge that he improperly lobbied Meese, now attorney general, by sending him an April 8, 1982, memo urging that Wedtech get the contract.

The memo suggested that Meese could enlist Defense Secretary Caspar Weinberger and President Reagan in the effort to persuade Marsh to give the contract to Wedtech.

Prosecutors contend the contact violated the Ethics in Government Act’s post-employment lobbying restrictions because the memo was sent shortly after Nofziger resigned his White House job.

On Friday, a former Small Business Administration official testified that the agency would not have helped Wedtech finance the contract had it not been for Jenkins’ interest.

Donald R. Templeman, the SBA’s former deputy administrator, said the SBA ″had some serious doubts″ about giving Wedtech large amounts of business development funds to help finance the Army contract.

But Templeman said SBA officials put aside their concerns after the May 19, 1982, meeting.

″Frankly, we would not have gone along with the contract had it not been for Mr. Jenkins’ interest,″ Templeman testified.

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