HUD Secretary's Comments Cause Mini Ad Scandal

Reportedly Denied Contract to Anti-Bush Vendor

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WASHINGTON (AdAge.com) -- A media report that U.S. Housing and Urban Development Secretary Alphonso Jackson canceled a government ad contract for a minority vendor because the contractor's chief didn't support President George W. Bush is drawing anger from Democrats.

Mr. Jackson made the controversial comments during a speech April 28 to the Real Estate Executive Council in Dallas and they were reported in the Dallas Business Journal May 5. In the speech, Mr. Jackson, a former president-CEO of the Dallas Housing Authority, said HUD had greatly improved the number of contracts it was awarding to minority businesses and closed his speech with a warning to exercise caution in dealing with government agencies, citing one contractor he dealt with.

"He had made every effort to get a contract with HUD for 10 years," Mr. Jackson said. "He made a heck of a proposal and was on the [General Services Administration schedules] list, so we selected him. He came to see me and thank me for selecting him. Then he said something ... he said, 'I have a problem with your president.' I said, 'What do you mean?' He said, 'I don't like President Bush.' I thought to myself, 'Brother, you have a disconnect -- the president is elected, I was selected. You wouldn't be getting the contract unless I was sitting here. If you have a problem with the president, don't tell the secretary.'"

"He didn't get the contract," the paper quoted Mr. Jackson as saying. "Why should I reward someone who doesn't like the president, so they can use funds to try to campaign against the president? Logic says they don't get the contract. That's the way I believe."

Hypothetical story
An aide to Mr. Jackson said that the secretary turned what was meant to be an "anecdotal, hypothetical story" about Washington ways that didn't really happen into a first-person account. The HUD official confirmed the quote's accuracy, but said Mr. Jackson was not describing a real incident, and instead meant to suggest the importance of caution in dealing with Washington. She added that Mr. Johnson has no role in HUD contracting process and that Ebony and Jet, which aren't the biggest supporters of the president, have HUD contracts.

Democrats, however, lost no time jumping on the wording of the speech. U.S. Rep. Henry Waxman, D-Calif., the ranking Democrat on the House Committee on Government Reform, and Barney Frank, D-Mass., the ranking Democrat on the House Committee on Financial Services, wrote Mr. Jackson to say that rejecting an ad contract because of politics "would be contrary to federal procurement law and an abuse of the public trust." The Democratic National Committee issued a statement saying Mr. Jackson's comments "exposes the culture of corruption" at HUD.

"The Bush Administration has a track record of rewarding its friends and ignoring the rules," Mr. Waxman said in a statement. "The government has no right to blatantly withhold contracts simply because an American citizen dislikes the president. This raises new questions about the integrity and judgment of the Bush Administration."

Mr. Frank said that if the report is accurate, "then President Bush must repudiate these comments, reverse HUD's course and assure the American people that politics plays no role in the government contracting process. I simply find these comments to be outrageous and unconstitutional."

The Democratic National Committee called Mr. Johnson's comments unbelievable. "It is absolutely astounding that the Secretary of Housing and Urban Development would brag about denying a federal contract based on the contractor's opinion of the president," the statement said.
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