Official: Stripes channeled money to DOD program
October 25, 2007
ARLINGTON, Va. — Stars and Stripes served as a conduit for money to promote America Supports You, but the newspaper did not spend any of its own funds on the program, a Stripes official confirmed on Tuesday.
In May, The New York Times reported that the Defense Department Inspector General’s Office was looking into whether America Supports You had moved money improperly.
The review has prompted two audits, one of which is looking at Stripes’ expenditures for America Supports You.
On Oct. 19, Stars and Stripes obtained documents showing the paper had awarded a $499,000 delivery order to the public relations firm Susan Davis International to promote America Supports You.
On Tuesday, the Stripes official said that money came from funds allocated by Congress, known as appropriated funds, which were transferred to Stars and Stripes and then deposited in the newspaper’s bank account for money not appropriated by Congress, known as nonappropriated funds.
For Stripes, nonappropriated funds include advertising and sales revenue.
Asked why appropriated funds were funneled through Stars and Stripes, the official explained that the procurement process can be “laborious” and the newspaper already had an agreement with Susan Davis International that could be expanded to include America Supports You.
The conversion of appropriated funds to nonappropriated funds as described above is allowed by public law, the official said.
However, a Defense Department policy on nonappropriated funds says that such monies “will not replace or supplement appropriations for public affairs” and other programs that are outside the nonappropriated funds entity’s purpose.
Asked about the policy, the official said he did not believe America Supports You is a public relations program, so the policy is not applicable.
Founded in 2004, America Supports You gives publicity to nonprofit groups that support U.S. troops.
The official also said he has not heard any concerns over the last two years that Stripes’ relationship with America Supports You might pose a conflict of interest, explaining the paper has business relationships with other government entities, such as the Army and Air Force Exchange Service.
The official stressed that many people, including Stripes’ editorial directors, knew of the paper’s relationship with America Supports You.
But Managing Editor Doug Clawson said Wednesday he was unaware of the extent of the relationship prior to Stripes’ reporting on the Inspector General’s review of America Supports You.
“Readers need to know that the newspaper they trust to provide them independent, accurate, credible news is not in any way operating in a compromised position,” Clawson said in an e-mailed response to questions.
“If, in fact, Stripes was helping handle public relations work on behalf of a political appointee it doesn’t look good, and could taint the editorial department, and thereby the readers’ perceptions of this newspaper’s mission.”
Former Stars and Stripes Editorial Director Dave Mazzarella said Wednesday that he was aware that the newspaper’s business side helped America Supports You with some events and promotional items, but he did not know the newspaper had awarded a purchase agreement for Susan Davis to promote the program, nor did he know how it was paid for.
Tom Davis, vice president at Susan Davis, deferred questions on the relationship between Stars and Stripes and America Supports You to the Defense Department.
Stars and Stripes’ relationship with America Supports You goes beyond the agreement with Susan Davis International.
Since October 2005, the newspaper has sold America Supports You merchandise on its online store, said Meg Irish, marketing director for the newspaper.