Harry Reid’s Pay To Play? Helping Himself Get Re-Elected By Rewarding Contracts To Big Dem Donor Arcata Associates

September 20, 2010 11:26

It appears that Senate Majority Leader Harry Reid plans to reward Arcata Associates, a big Democratic donor, a huge no-bid contract on the heels of two separate $10,000 (maximum) donation to the Nevada Democrat party.

Harry Reid’s Pay To Play? Helping Himself Get Re-Elected By Rewarding Contracts To Big Dem Donor Arcata Associates

Posted by Melissa Clouthier on Sep 20 2010

It appears that Senate Majority Leader Harry Reid plans to reward Arcata Associates, a big Democratic donor, a huge no-bid contract on the heels of two separate $10,000 (maximum) donation to the Nevada Democrat party.

Senator Harry Reid, along with his House cohort Nancy Pelosi, promised to drain the swamp when they took full control of Congress. Their behavior since taking office would indicate the exact opposite has happened.

In fiscal year 2010, Arcata won a 1.36 million dollar contract for the Continuous Threat Alert Sensing System (CTASS) according to OpenSecrets.org after spending $50,000 to lobby the Senate. What the site fails to mention are the multitude of Arcata donations to Harry Reid and the Nevada Democrat Party. In addition, Arcata stands to gain another two million dollars in 2011, also a no-bid earmark directed by Senator Reid. The requests for these earmarks can be found here and here.

The Wong family, owners of Arcata Associations, have a long history of donating generously to Harry Reid. Their donations are over $130,000. Here is a PDF of all the donations.

In fact, the very existence of Acata Associates can be linked to a questionable Defense Department contract awarded back in 1981 by the Small Business Administration. From Associated Press Writer Mike Feinsilber on April 8, 1981:

A program designed to help disadvantaged small businesses climb the economic ladder is being abused by some companies which farm out government contracts awarded without competitive bidding and then keep the profits, government investigators say.

In one case, a congressman charges, a small California firm was given a contract, over protests of the Army, to test sophisticated new weapons systems, although it was clear the firm was not up to the job. The company subcontracted with a more experienced outfit.

“This guy comes in and gets a $44 million contract and everybody knows he cannot do it,” said Rep. Jack Brooks, D-Texas, chairman of the House Government Operations Committee, complaining to officials of the Small Business Administration.

The 12-year-old SBA program has awarded $5.5 billion in contracts to 4,600 “socially and economically disadvantaged” companies, but only 4 percent of the businesses have managed to cut their government ties and become competitively self-sufficient.

Brooks focused on how Arcata Associates, Inc. of Burlingame, Calif., with less than $1 million a year in sales and 87 employees, landed a five-year, $44 million contract to test the Army’s most sophisticated new weapons and tactical concepts.

Arcata’s president, Buck Wong, previously ran a company that had the hot dog and beer concessions at Stanford University football games.

When it landed the weapons contract, Arcata was chiefly in the business of advising minority-owned firms on how to win government contracts, according to investigators for the House committee.

The General Accounting Office, the investigative arm of Congress, said Arcata subcontracted 67 percent of the professional work to Planning Research Corp. of McLean, Va., a high-technology firm with $270 million in sales and a staff of 6,450 employees.

A spokesman for Arcata, asking not to be identified, said the work subcontracted to PRC amounted to only 38 percent of the contract’s value.

So a company with no defense testing expertise was “made” by the SBA and continues to exist by receiving multiple no-bid government contracts via earmarks after donating to Democrats, specifically the Nevada Democratic Party and Senator Harry Reid.

The most recent donations indicates a possible quid pro quo relationship between Arcata and Senator Reid. Arcata executives gave the Nevada Democratic Party $20,000 on June 5, 2009.

To understand why the timing of this large donation raises eyebrows, one must understand the timing of the congressional earmark process. For an organization to obtain an earmark, the organization must submit a request to Sen.Reid’s by their appropriations request deadline. In 2009, Sen. Reid’s deadline was at the end of February.

After receiving submissions, Reid would go through the many submission and some of them to submit to the Appropriations Committee for consideration. Thee committee’s deadline for submissions is sometime between April and June (the deadlines vary from year-to-year; this would most likely happen in mid-May). Between then and when the bill is released, Reid would prioritize the list of requests he submitted. Members typically submit many requests to the committee, but only some of these are funded. For example, in Fiscal Year [FY] 2010, Reid submitted 58requests to the committee, of which 31 were funded.

Taking into account these priorities, the committee releases its bill with the list of earmarks. In 2009 (the FY 2010 bill), the committee released the bill on September 10, 2009. The FY 2011 bill was released on September 14, 2010.

On or about June 5, 2009, Tim Wong and his wife Shari each gave the Democratic Party of Nevada $10,000—the maximum about allowed by law. Note that June 5 is in between the date when requests were submitted to the Appropriations Committee and when the committee releases their list of earmarks.

On or about April 20, 2010, Buck and Aurora Wong each donated $2,200 to Harry Reid—nearly the maximum of $2400. Again, the timing here raises questions.

All this to demonstrate that Democrats, especially their Senate Leader Harry Reid are hypocritical at best, and criminal at worst when it comes to how they use money to buy power.

This particular nefarious politics-as-usual act can be stopped, however. The Senate votes Tuesday on the Appropriations Bill in question. Will Senator Reid strip this no-bid earmark from the bill? He should.

Also, don’t forget, this is the same bill that Senator Reid tacked on the highly controversial DREAM Act.

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