By Edward T. Pound, National Journal
© National Journal Group Inc.
Monday, March 17, 2008

Rep. James Clyburn, the Democratic majority whip whose name has emerged in the controversy over contracting practices in New Orleans by the federal Housing and Urban Development Department, said in an interview that he played no role whatsoever in the decision to give lucrative work to contractor William Hairston, his longtime friend.

	Clyburn said it was possible that Hairston, like others, had benefited from the congressman's conversations with Jackson in which he had pushed for more minority-hiring on the Gulf Coast.

Hairston is a central figure in the federal criminal investigation of HUD Secretary Alphonso Jackson. Last year, Hairston told National Journal he understood that Clyburn, of South Carolina, had recommended him to Jackson for a contracting job at the Housing Authority of New Orleans, or HANO; the troubled New Orleans agency has been under HUD's control since February 2002.

Hairston, who lives in Hilton Head, S.C., and is a sometimes golfing buddy of both Jackson and Clyburn, was paid more than $485,000 for working at HANO during an 18-month period. The work was not competitively bid.

In the interview with National Journal, Clyburn said that he had long been a strong proponent of affirmative action and had pressed Jackson and other federal executive branch officials to hire more African-Americans and women.

But when asked if he had interceded on Hairston's behalf with Jackson, Clyburn declared, "No, I did not recommend William Hairston to Jackson." He said it was possible that Hairston, like others, had benefited from his conversations with Jackson in which Clyburn had pushed for more minority-hiring on the Gulf Coast, including New Orleans, after the catastrophic Hurricane Katrina.

But he continued, "All I am saying to you is that I never, ever wrote a letter, never made a phone call, never spoke to Alphonso Jackson about any one specific person."

Clyburn said that he and Hairston have been friends for more than 15 years, and that he often saw Hairston on visits to Hilton Head. Clyburn, Jackson and their wives were guests at a holiday party given in December 2006 at the home of Hairston and his wife, Starletta.

Jackson's ties to contracting at HANO are a major focus of the criminal investigation, which is being directed by Justice Department prosecutors and includes agents from the FBI and the HUD Office of Inspector General. Evidence is being collected by a federal grand jury in Washington.

Jackson's congressional testimony is one area under close review -- specifically statements he made in May 2007 to the Senate Appropriations Subcommittee on Transportation, Housing and Urban Development, and Related Agencies. Jackson said flatly: "I don't touch contracts."

Investigators, however, are reviewing his actions in the Hairston case; what role, if any, he played in the awarding of a $127 million project to redevelop the St. Bernard public housing project in New Orleans to a company that owes him more than $250,000; and whether he helped line up a lucrative contract for another friend, Atlanta attorney Michael Hollis, at the Virgin Islands Housing Authority.

Separately, HUD's management of HANO has become a big issue to some on Capitol Hill. HUD Inspector General Kenneth Donahue has directed auditors to begin a review of HUD's management practices at HANO. Donahue's decision to conduct the audit became public after Sens. Christopher Dodd, D-Conn., the chairman of the banking committee, and Mary Landrieu, D-La., asked for the review in a letter to Donahue last week.

The two senators expressed concerns over how well HUD had managed the New Orleans agency and said it was imperative that housing conditions in New Orleans be improved. They added:

"In the wake of Hurricane Katrina, the increased need for affordable housing in the area also highlights the need for public review of HUD progress in improving HANO management and finances. For example, HANO has received almost $500 million in federal funds to demolish 4,500 apartments in the four biggest public housing developments in the city. Given the enormous federal investment in the region, it is essential to ensure HANO has sufficient staffing, financial controls, and management in place to sufficiently oversee the use of these funds."

In a separate letter to Jackson, Landrieu made it clear that she wants to know who is benefiting from contract awards in New Orleans: "Please provide a list of all contractors currently engaged by HUD/HANO, details on what particular function they are performing for HANO, and copies of all contracts approved by the HANO Board of Directors."