GOP report: Deal with Sacramento mayor was rushed

AP News
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Posted: Nov 20, 2009 9:35 PM

Two congressional Republicans say federal prosecutors rushed into a settlement with a nonprofit operated by Sacramento Mayor Kevin Johnson that had been accused of misspending government grants.

Rep. Darrell Issa of California and Sen. Chuck Grassley of Iowa released a report Friday concluding that a settlement in which Johnson and his foundation agreed to repay $424,000 whitewashed a government investigation into the matter.

Issa is the ranking member of the House Oversight and Government Reform Committee, and Grassley is the ranking member of the Senate Committee on Finance.

Nearly $850,000 in grants came to Johnson's St. HOPE Foundation in Sacramento through the federal AmeriCorps program. The national service agency's inspector general, Gerald Walpin, criticized the settlement, which was reached in April, and was fired by the White House shortly thereafter.

Issa and Grassley said the White House illegally fired Walpin. But they said they could not conclude he was fired for political reasons because the White House withheld crucial documents.

"There is simply insufficient evidence to conclusively reject the notion that the removal may have been motivated by a desire to exert greater control ... without interference from an aggressive, independent IG," the report said.

The White House said it followed all laws in firing Walpin, citing poor performance.

"There is nothing new in today's report, which ignores the multiple bases for Mr. Walpin's removal and doesn't provide a shred of evidence that suggests he was removed for any reason other than performance issues," White House spokesman Ben LaBolt said.

Johnson, a former NBA star, started St. HOPE in 1989 to revive the inner-city neighborhood where he grew up. St. HOPE has since grown from a modest after-school program to include charter schools, art and community development programs, and an urban peace corps program called Hood Corps.

Johnson and his St. HOPE Foundation were suspended from receiving federal funding last year after allegations that AmeriCorps money went to workers who ran personal errands for Johnson, such as washing his car and driving him to events, and sometimes engaged in politics. Johnson was elected mayor in November 2008.

Johnson was also accused of inappropriately touching three teenage students at St. HOPE's school, although no charges were filed.

The report released Friday contains new details about those allegations, including a claim by one student that Johnson offered to pay her $1,000 a month for the rest of the program if she agreed to keep quiet about her claims about Johnson.

She told federal investigators that Johnson came to her apartment around midnight one night to go over some work, then climbed into her bed and suggested they work there. She said he laid down behind her and cupped his body around her. Later, she said, Johnson's attorney approached her and "basically asked me to keep quiet."

Steve Maviglio, a spokesman for Johnson, said the mayor is caught in a political fight between right-wing Republicans in Congress and the administration of President Barack Obama. Johnson, a Democrat, has campaigned on behalf of Obama and says he is a friend of the president.

"It's politics, plain and simple," Maviglio said. "The allegations are meritless. They've been investigated by the Sacramento police, the U.S. Attorney, AmeriCorps, professional prosecutors and the FBI. None of them have found any merit in it."

The allegations of improper relationships with teenage girls surfaced during Johnson's mayoral campaign, but Sacramento police and sheriff's officials found no evidence of illegal behavior and declined to file charges.

The Republicans' report says the U.S. attorney overlooked the inspector general's findings and cut him out of settlement talks in order to quickly reach a deal with Johnson.

The U.S. Attorney's Office for the Eastern District of Northern California, which reached the settlement with St. HOPE, did not return a call seeking comment Friday.

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Associated Press Writers Kevin Freking and Ann Sanner in Washington, D.C., also contributed to this report.