A federal agency’s second highest-ranking official draws a $174,000 salary for his job on K Street in Washington, yet he insists he is an Iowa resident for state tax purposes.
An inspector general earlier this month referred the tax situation of Scot Beckenbaugh, who has been deputy director and acting director of the Federal Mediation and Conciliation Service in recent years, to the IRS and District of Columbia tax officials.
A FMCS employee described Beckenbaugh’s situation to an agency lawyer and was told that he “should not raise these issues … as it would open a can of worms that can’t be put back in the can,” according to an IG’s sworn interview of the employee.
“Beckenbaugh changed his address from Iowa to D.C. and so the system changed his withholding. And he got mad about that and made them change it back to Iowa,” the employee said.
Beckenbaugh lives in a tony building in one of Washington’s most expensive neighborhoods, where one-bedroom apartments rent for nearly $4,000 a month.
As reported by the Washington Examiner, FMCS officials agreed to allow the IG for the Architect of the Capitol to independently investigate complaints brought by the employee, but Beckenbaugh abruptly ordered the probe terminated when the IG requested records detailing top managers’ activities.
FMCS is an obscure 230-employee agency with a $50 million annual budget that provides voluntary mediation services between unions and private businesses in labor disputes. The agency has no inspector general and its director reports only to the president.
John Arnold, an FMCS spokesman, told the Examiner that “federal employees are responsible for determining and meeting their own tax obligations. The agency does not make tax decisions on behalf of individual employees.”
Arnold also said “such individual tax issues are protected by federal privacy laws, and for a current or former official to divulge such information could constitute a violation of the Privacy Act.”
It is not illegal for individuals to blow the whistle and provide information about lawbreaking to investigators, even if it may otherwise be covered by privacy laws. FMCS has repeatedly been accused of retaliating against whistleblowers.
Beckenbaugh was routinely reimbursed by the federal government for him to visit his wife, who lives in a house they own in Des Moines.
“They do some cost comparison. They’ll pick the most expensive fare to the place that is duty-related … then they said, ‘Oh, well, it’s equal to or less than that, so he can fly home and then he can fly from there to the next place,’ ” the complaining employee said.
The employee’s account is consistent with hundreds of pages of FMCS records obtained by the Examiner under the Freedom of Information Act.
“Traveled to NYC from residence but returned to duty station. Airfare [from Iowa to New York] was cheaper than cost of train ticket from DC to NYC, so amount charged is what was paid,” reads a typical expense report explanation.
Beckenbaugh justified charging the government for his flight to Pittsburgh from a friend’s house in Florida by claiming that a fare from Washington to Pittsburgh would have cost $1,110, so it was a better deal to pay for his flight back from vacation.
In fact, many flights from Washington to Pittsburgh cost less than $100.
When he had business in Harrisburg, Penn., Beckenbaugh had FMCS pay for him to travel there from the District, and then to Des Moines, paying out of pocket for what he said was the difference between a flight from Harrisburg to Des Moines and a train to D.C.
But when his connecting flight to Des Moines was canceled because of foul weather, Beckenbaugh billed FMCS for his layover at a hotel in Chicago, where he would never have been if he had been on the train to Washington.
His expense reports also show him routinely returning to certain cities where he would spend days of “personal time” after having the agency foot the bill for the flights for an FMCS meeting.
There are, for example, a disproportionate number of Beckenbaugh trips to Kansas City (where he has friends and which is a few hours from Des Moines) and to Florida, where he often vacationed.
“The flight from Kansas City to NYC was $992.80. If he had been in D.C. (at his duty station) a train to NYC would have been about $250,” an assistant protested when reviewing his report, referring to a case where he was on vacation near Kansas City and flew to a business meeting in New York. She was instructed to reimburse him the full cost of his flight.
The records also show the sheer magnitude of the costs Beckenbaugh incurred in the course of representing FMCS, and how apparently nothing was too small to be billed to the government.
On that same trip to New York, Beckenbaugh racked up a $2,253.80 hotel bill at the Manhattan East Hilton from Dec. 30, 2012, to Jan. 6, 2013.
A note to his assistant attached to a receipt for a $4.50 airplane Wi-Fi bill said, “I want to start claiming these on my voucher.”
The majority of his travel reports include stops in Des Moines as part of a complicated itinerary.
In October 2013, for example, he went to New York, Oakland, Calif., Toronto and Boston for work, and also made four trips home to Iowa.
The former employee said some of the trips weren’t necessary but were a pretext for Beckenbaugh to get the government to pay for most of his travel to Iowa.
“He tries to tack on some work-related trip on the end of it,” the employee told investigators.
Federal law doesn’t permit government employees to be reimbursed for personal expenses.
Last month, Jeff Neely, the former General Services Administration regional administrator who organized an infamously opulent employee conference in Las Vegas, was indicted by a federal grant jury on five counts of fraud for which he could face prison time.
Prosecutors said he “fraudulently sought reimbursement for personal travel and expenses,” a government statement said.
