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  • VA adds safeguard on confict of interest

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    VA adds safeguard on confict of interest

    By JEFF TESTERMAN, Times Staff Writer
    © St. Petersburg Times
    published January 11, 2002

    ST. PETERSBURG -- In the wake of the federal investigation into the involvement of former U.S. Department of Veterans Affairs official Chester M. Luney with a Tampa homeless shelter, the VA has instituted new conflict-of-interest procedures nationwide.

    Luney, an $80,279-a-year VA psychologist, wrote grants that funneled federal tax money to a homeless veterans shelter run by the Tampa-Hillsborough Action Plan, a nonprofit that at the same time paid Luney $78,000 a year. Luney also acted as VA liaison for the homeless shelter, making inspections that helped ensure continued federal funding for THAP.

    Wednesday, VA Deputy Secretary Leo S. Mackay Jr. said VA liaisons will now be required to file forms annually to disclose any interest they have in a program they oversee. The change was in direct response to stories in the St. Petersburg Times revealing that Luney held dual roles at the VA and THAP.

    "We have strengthened an already robust system of accountability," Mackay said. "When you discover a problem with safeguarding tax dollars, a good organization admits its error, makes changes and moves on."

    Mackay's comments came in a meeting with the Times editorial board. The deputy secretary, a recent Bush appointee, was in St. Petersburg to present a $949,215 check to the Society of St. Vincent de Paul South Pinellas to establish a 40-bed homeless vets facility at 401 15th St. N.

    Luney abruptly resigned his post at the VA in early October after the Times sought federal records on VA grants to THAP. A week later, the VA's Office of the Inspector General opened an investigation into Luney.

    Later, a surprise inspection of THAP's Veterans Village homeless shelter by the VA turned up numerous deficiencies. The inspection report was in stark contrast to a glowing inspection by Luney a year earlier that claimed transitional services, vocational training and counseling were all being provided.

    The new VA report found no evidence of such programs and noted other problems as well. Vets were supposed to receive meals and live rent-free but actually got no food and were forced to make $150 rent payments to the THAP manager each month.

    Pete Dougherty, the director of the Homeless Grants Program for the VA, said Wednesday that VA liaisons will no longer be permitted to make annual inspections alone, as Luney did. Instead, to improve monitoring, liaisons will be joined by other VA staffers who have no connection to the homeless program.

    THAP's board ousted Luney in December and promised reforms. But the VA continues to withhold $1.2-million in grant money awarded to the nonprofit until the inspector general's investigation is complete.

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