New Inspector General Finds NSF Resistant To Oversight

A conflict-of-interest case demonstrates that she lacks the power to enforce guidelines on post-employment contact WASHINGTON - Last year the National Science Foundation broke its own rule that bars former employees from discussing a potential grant or contract with foundation officials for at least one year. But when NSF's new inspector general blew the whistle on the infringement, agency officials in effect shrugged their shoulders and promised to do better the next time around. The case of Stanley Presser, a sociologist at the University of Maryland and a former program director within NSF's division of social and economic sciences, suggests that the relationship between the new office and the foundation can get a little rocky at times. The inspector general's office, created by legislation passed in 1988, is supposed to watch over the $2 billion foundation. But the investigations conducted by IG Linda Sundro and her staff into alleged financial or ethical improprieties by grantees, contractors, and agency staff are still a new experience for an agency previously scrutinized only by an in-house auditing department. Presser came to the foundation in September 1985 from the University of Michigan, and left in September 1988 to take his current position at Maryland. Several months later NSF officials decided to conduct a survey of employee attitudes toward the foundation, and they thought that Presser's expertise in designing and conducting such surveys and his knowledge of the foundation made him the perfect candidate to bid on a contract. That's when the trouble started. "I was contacted by someone at NSF about an upcoming request for proposals, and I said that I didn't think I could bid on it because of the [post-employment] rule," recalls Presser. "So I called the general counsel's office, and the conflicts officer told me that it wouldn't be a problem as long as I submitted it under my own name." That advice was incorrect, according to the inspector general's office. "NSF's one-year post-employment restriction has been violated," wrote James Zwolenik, assistant inspector general for oversight, in a March 23 report. Zwolenik says he thinks that lots of people should have known better, noting that "a number of internal controls intended to enforce the conflict-of-interest regulations did not function." In their absence, Presser was awarded an $18,945 contract. The actual violation hinges on a technicality, says Charles Herz, NSF's general counsel. The rule does not bar former employees from receiving grants or contracts. Rather, it prohibits them from talking with NSF officials about such awards. In Presser's case, that meant four conversations covering the proposal itself and negotiations on a higher budget (to purchase a $450 piece of software that NSF needed to analyze the data). The rule exists to prevent a former employee from gaining an advantage over another applicant in the competition for NSF funds. "You don't want someone who knows NSF to use his inside contacts and influence to get a grant," explains Herz. "The point is to avoid a cozy insider deal in which somebody leaves the foundation and the next day calls his former colleagues to propose an idea that he's uniquely qualified to carry out." Nobody has accused Presser of any such impropriety. The inspector general's report notes that "there was no indication that [Presser] at any time attempted to conceal his former NSF employment." Neither did Presser try to cash in on inside information. "This had nothing to do with the people that I had worked with," Presser says. "It wasn't even in the same directorate." In fact, says Herz, the fact the contract originated in the division of personnel, and not a research directorate, was part of the problem. "It was a comedy of errors," admits Herz. "It was a contract, not a grant, and not everyone knew that the rule also applies to contracts. It came from an outfit that doesn't normally handle contracts, so they weren't as familiar with the rules as they should have been. And the Division of Contracts and Grants didn't stop it because he [Presser] didn't have a previous record as a principal investigator, and so didn't have a folder on him that was flagged as someone who had once worked at NSF." The system has since been revised, Herz says, and now contains an entry for every former employee since 1987. But Sundro believes that ignorance is hardly an excuse. "These are fairly intelligent people, after all," she says. "They receive the manual that explains the rules, and they hear about it again during their exit interview. He [Presser] was right to question whether he could submit a proposal, but the foundation just dropped the ball." Sundro's office recommended that NSF, to correct its mistake, should terminate the contract and hold a new competition. Such a step, the report notes, would eliminate a situation in which "the other bidders and members of the general public might easily conclude that improper activity had occurred." That recommendation was rejected by NSF officials, however. Their reasons reflect the inherent conflict between the watchdog and the researcher. As general counsel Herz explains, "there was a feeling that the IG was taking too long to resolve this matter, that it was a fairly small contract, and that the work was nearly complete. There was also the question of whether this was a big enough deal to put a stop to." In the end, the foundation suspended Presser's contract for a short time while the investigation was under way. (The results of the four-page survey of all 1,200 employees are due out next month, Presser says.) And it agreed "to reaffirm its commitment" to the post-employment ban. The inspector general's office was less than pleased with that outcome, however. Although a March 30 addendum to the report notes that "we have deferred" to the agency, it adds that "we remain concerned that the appearance of impropriety is not overcome by an action less than the termination of the award." The case may not have improved the relationship between the inspector general's office and the foundation, but it did suggest where each side stands. Says Herz, "The IG can afford to be tougher than anybody in the foundation, and I think that's good." For her part, Sundro says her office will continue to perform its job of investigating alleged errors and improprieties. "We need to tell them when they step over the line," she says.

New Inspector General Finds NSF Resistant To Oversight

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