The Daily Caller: Political pressure tainted error-ridden GAO report

The Daily Caller

By Jonathan Strong

A smoking gun document about an error-ridden GAO report puts the murder weapon in a top Democratic senator’s hands.

GAO issued a slew of corrections in November to an undercover investigation into for-profit colleges requested by Sen. Tom Harkin, Iowa Democrat, who had unveiled the report at a hearing highly critical of the schools Aug. 4.

A internal GAO email obtained by The Daily Caller, a self-evaluation on what went wrong from a member of the team that wrote the report, suggests GAO was under the gun.

The email says GAO was put under “extreme short time frames” by Harkin to issue the report and “congressional staffers” demanded the inclusion of numerous details as it was being finalized.

“It certainly discredits the report, doesn’t it?” said Rep. Rob Andrews, New Jersey Democrat and long-time advocate for the for-profit schools, “The fact that they felt pressure to finish this on time is disquieting.”

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Sources close to the issue have long said Harkin’s influence on the report was key, but the official GAO report on what happened apparently whitewashed the issue. That report was not released to the public.

The report was “an anomaly due to its extreme short time frames,” the email says, adding that the deadline for the report was “not flexible.”

“The team’s unwillingness to say no to the additional insertion of details at the end of a job created some of our most obvious inaccuracies,” the email says, citing pressure internally at GAO for the inclusion of these “details” as well as from “stakeholders” and “congressional staffers.”

The report was crucial because it helped the push for strict new regulations at the Department of Education on the for-profit colleges. The most controversial part of the regulations, called gainful employment, is pending at the White House Office of Management and Budget.

Suggestions of political influence on the error-ridden report are important because unlike budget scores by the Congressional Budget Office, which lawmakers have learned to game, GAO is known for being scrupulous and its reports are trusted on Capitol Hill.

The email maintains the “message” of the report is “accurate” and GAO spokesman Chuck Young said “we continue to stand by the report.”

Harkin, asked if he or his staff had any role in the errors in the GAO report said, “That was a GAO product, I didn’t have anything to do with it.” When informed The Daily Caller had reviewed an internal evaluation of what went wrong, he said, “I’ll have to go back and look at the time frames and stuff like that, I can’t remember that. I can’t remember the time frames. No, I don’t recall that being an issue at all.”
Justine Sessions, Harkin’s spokeswoman, said GAO agreed to present its report for the Aug. 4 hearing and “never requested an extension.”

The internal evaluation email says one specific “detail” demand in particular drove “most of our corrections.”
The detail was a summary of how many schools made deceptive claims about graduation rates and accreditation questions in the form of “X of 15 schools,” the email says.

“We then went back and stretched whatever we could find to come up with a number for the testimony. This was done in haste and is where most of our corrections came from,” the email says.

One source said Harkin’s office requested this summary, but Harkin spokeswoman Sessions denied that, saying, “HELP Committee staff gave GAO no instructions on how to conduct the investigation, and did not request that graduation rates or accreditation information be addressed.”

Summarizing how the demand for “details” caused errors in the report, the email says “to prevent this in the future, we must educate ourselves and external stakeholders that we cannot insert an infinite amount of new detail without adding additional time to the job.”

The email was written by an unknown team member to Gregory Kutz, the GAO official who testified about the report at Harkin’s Aug. 4 hearing. TheDC did not learn the author of the email but did confirm its authenticity.

In early March, GAO replaced Kutz with Rick Hillman, a career GAO employee, as head of the watchdog organization’s undercover sting operations.

The for-profit report, corrected Nov. 30, has been a major stain on GAO’s normally unimpeachable reputation.

For the report, GAO conducted a sting operation, posing as potential students for the for-profit schools. The investigation found numerous instances where admissions representatives made deceptive or misleading statements.

However, a red-line version of the report, highlighting all of the corrections, shows almost all of the significant errors made the for-profit schools look worse than what really happened.

Generally speaking, the corrections underscore how the undercover “students” pushed the for-profit college representatives towards dishonesty.

For instance, one for-profit representative estimated whether a undercover agent would be eligible for federal aid if he falsified his financial aid form. The corrected report says the representative made the estimate “upon request by the applicant.”

Sleazy, yes. But the fraud was the undercover agent’s idea in the first place.

Many of the corrections change the report from saying admissions representatives “told” the undercover agents they “should” do something to saying admissions representatives “indicated” the undercover agents “could” do something.

Andrews, the New Jersey Democrat who has been fighting the “gainful employment” regulation vigorously, said the errors were out of the ordinary for GAO.

“I have a lot of faith in the GAO,” he said. “They’re the most straight down the middle organization I’ve ever worked with. I’m not surprised that congressional staffers tried to pull them and push them in one direction or the other.

“I think that happens pretty frequently, frankly. But I think they’re pretty good at resisting it,” Andrews said.
But in this case, the internal evaluation says GAO’s “unwillingness to say no to the insertion of additional details” drove the “most obvious” errors.

“That’s pretty clear,” Andrews said, “it’s a rare exception to their objectivity.”

The Coalition for Educational Success, a trade association representing the for-profit schools, is suing the government over the report, saying it “blatantly misrepresented the actual exchanges between the GAO’s undercover investigators and the representatives of certain for-profit colleges.”

But Harkin argued, “None of the errors got to the essence of what they were finding — The fact that people were mislead” by representatives of the for-profit colleges.

“The essence is 25 percent of Pell Grants now go to for-profit colleges and only 10 percent of the students go there. Many of these for-profit schools are engaging in high-pressure tactics to get low income and poor students to go there. These students are dropping out at a huge rate with massive amounts of debt,” Harkin said.

The internal evaluation email says future GAO reports also face risk of errors.
“Given the short time frames of the job and the volume of undercover work performed, this engagement was at a higher risk from its initiation. This is not necessarily a systemic issue, but will likely be a problem we face again in the future,” the email says.

“Because staff were forced to do writeups of tests [undercover stings] on the road while preparing for the next test, some of the written summaries were not 100 percent accurate. That error was compounded by the limited time that Heather and I had to review documents. I take responsibility for not listening to all 60 hours of audio and checking those files with what was summarized in writeups,” the email says.

“In the end, the products produced were accurate on a macro level and accurately portrayed the results of our tests. However, if [GAO] wants to continue to produce products with numerous small details inserted late in the process, we will have to extend job timelines. If, as with the for-profit schools job, timeframes are not flexible, we have to understand that there will be some unavoidable risks,” the email says.

The email also says undercover agents should be instructed not to make “off color jokes” while the tape is rolling.

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