Monday, January 30, 2006

GRAND JURY INDICTS DOYLE OFFICIAL ON TRAVELGATE


WED., JAN 25, 2006 - 12:00 AM
Employee indicted in state travel deal
PHIL BRINKMAN pbrinkman@madison.com

A federal grand jury indicted a state employee Tuesday, charging her with manipulating the process of awarding a state travel contract to ensure it went to a company whose officials gave heavily to Democratic Gov. Jim Doyle's election campaign.
Georgia Thompson, 55, was charged in Milwaukee with the misapplication of state funds and fraud for her role in the state's hiring of Adelman Travel Group of Milwaukee, which prosecutors said was intended "to cause political advantage for her supervisors" and "help her job security."

One of those supervisors, former Administration Secretary Marc Marotta, called the allegations "completely puzzling."

"I don't know what political advantage any of her supervisors could have," Marotta said. "It was a very standard, small procurement that was done to the advantage of taxpayers."

In a statement late Tuesday, Marotta's successor, Steve Bablitch, said, "The Doyle administration has zero tolerance for ethical lapses, but we certainly hope that saving money for taxpayers doesn't become a crime in Wisconsin. We also hope that the career of a civil servant doesn't become a political football."

Among other things, U.S. Attorney Steven Biskupic said Thompson intentionally inflated the score she gave Adelman as part of the seven- member committee evaluating proposals by companies to provide travel services for state employees, student-athletes and study-abroad programs.

Six of the seven members of that committee opted to award the largest contract, covering about 40 percent of state travel, to Omega World Travel of Fairfax, Va. But Thompson's high score for Adelman created a virtual tie, prompting the department to call for a "best and final" offer from the two companies.

With its revised bid, Adelman came in about $27,000 cheaper than Omega.

To sweeten the pot, Biskupic said, Thompson told members of the committee she inflated her scores for another travel agency - favored by some members of the group - when they were voting on a separate contract for athletic travel. The indictment says Thompson hoped to use that as a "negotiating tool" to get the group to back Adelman's bid for the larger state employee contract.

Neither Thompson nor her attorney, Steve Hurley, could be reached late Tuesday after the charges were announced. Thompson has previously denied any wrongdoing in the contract award. If convicted, Thompson could face up to 20 years in prison.

The case is being investigated jointly with state Attorney General Peg Lautenschlager, Dane County District Attorney Brian Blanchard and U.S. Attorney Steve Sinnott in Madison.

Federal authorities were involved in part because much of the money the state spends on travel comes from the U.S. government.

The indictment doesn't say which supervisors Thompson was allegedly seeking to help or whether she was pressured from above to favor Adelman, and Biskupic's office declined comment.
Adelman's chief executive, Craig Adelman, and a board member, Mitchell Fromstein, each gave Doyle's campaign a total of $10,000 - the maximum allowed - in the months before and after the contract was announced in March.

Thompson, who was hired under former GOP Gov. Scott McCallum, is a section chief within the DOA's Division of Enterprise Operations, which helps state agencies procure goods and services, including the state's vehicle fleet.

The division is headed by Patrick Farley, a former assistant Milwaukee County district attorney and labor lawyer for the Wisconsin Education Assocation Council, the state's largest teachers union. Efforts to reach Farley on Tuesday were unsuccessful.

Farley reports to the secretary, who is considered the right hand of the governor. At the time, that was Marotta, who left last fall to head Doyle's re-election campaign. But Marotta said the contract was "very, very small" and never registered on the radar of anyone in upper management.

"Nobody at that level would have ever thought about it," Marotta said.

Bablitch, who took over in October, said as far as he could determine, the contract was awarded to the lowest bidder "and all appropriate procedures were followed," although at least one committee member publicly questioned reopening the bids.

Bablitch noted Adelman didn't win three of the four contracts it bid on, including a contract for booking travel online, which administration officials say could prove to be the most lucrative.

Under the contract Adelman received, the company gets a fee for each ticket it books but is not guaranteed a total amount. Officials have estimated the contract could earn the company $750,000 over three years if past travel is any indication. To date, the company has earned $36,000, Bablitch said.

Bablitch said Thompson will be assigned to different duties until the matter is resolved.

"We hope that this matter will get a swift and fair resolution, free from partisan politics," he said.

But Republicans were quick to pounce on the governor, who was visiting troops in Iraq on Tuesday and limited his remarks in a conference call with reporters earlier in the day to comments about that trip. Doyle has said in the past that he played no part in the contract award.
U.S. Rep. Mark Green, R- Green Bay, a Republican gubernatorial candidate, used the indictment to reiterate his reform plan, which includes banning contributions from individuals associated with companies bidding on state contracts.

His GOP rival, Milwaukee County Executive Scott Walker, said Doyle should return contributions from such donors.

Potentially adding more fuel to the fire, the state Ethics Board is expected to announce today the outcome of its investigation into a Doyle campaign fundraiser, held by the Department of Transportation's No. 2 official, to which bidders on state engineering contracts were invited.

State and federal authorities are also looking into that event, as well as possible links between campaign donations to Doyle and state regulators' approval of the sale of a nuclear power plant.

Travel contract probe summary : Georgia Thompson, an official within the Department of Administration's procurement bureau and member of a committee that evaluated bids for a state employee travel contract, was indicted on charges of misapplication of funds and fraud related to the contract selection process.

INDICTMENT

ALLEGATION: Thompson is accused of inflating her score for Adelman Travel Group, which ultimately caused the contract worth up to $750,000 to be awarded to that company.

CAMPAIGN CONTRIBUTIONS: Two Adelman officials each gave Gov. Jim Doyle's campaign $10,000 in the months before and after the contract was announced.

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