Senate Votes No 2010 Funding for ACORN; Access to Stimulus Funds in Crosshairs

Last night the Senate Banking committee voted by 87-3 to bar Federal funding to ACORN for 2010 under the appropriations bill that covers Treasury, Housing and Urban Development, and related agencies. The Senate's ACORN funding ban was proposed by Senator Richard Shelby (R.-Ala.), ranking Republican on the Senate Committee on Banking, Housing and Urban Affairs. Senator Christopher Dodd (D.-Conn.), chairman of the committee, supported Shelby's proposal.

In addition to initiating last night's ACORN Senate vote, Shelby called for an investigation of ACORN in the wake of reports that ACORN staff in Maryland, New York and the District of Columbia provided illegal advice to BigGovernment's James O'Keefe and a female compatriot when they posed as a prostitute and her boyfriend seeking to gain access to housing funds and avoid tax liabilities for a brothel that would employ underage girls. The Senate vote responded to videos posted on the internet revealing ACORN employees encouraging tax fraud and other questionable conduct.

ACORN Retains Access to Stimulus Funds Despite Senate Vote

ACORN remains eligible for millions of dollars of taxpayer funding under the stimulus legislation passed by Congress in 2008, according to a press release issued by Senator Richard Shelby. ACORN's access to previously appropriated funds is not affected by the ACORN Senate vote last night because that vote concerned a 2010 appropriations bill.

Shelby demanded that the HUD inspector general open an investigation into ACORN's activities.

What Can HUD's IG Do About ACORN's Ongoing Receipt of Federal Funds?

ACORN's access to stimulus funds can be prevented. To immediately protect public funds by curtailing ACORN's access to virtually all Federal funds, all that HUD's inspector general need do is open an investigation and make a referral with existing evidence to the official within HUD responsible for issuing government-wide suspension and debarment notices. Such a suspension would become effective upon the signing of a letter by the HUD suspending official to ACORN notifying it of its suspension.

Will HUD be able to sustain such an action? As a former Federal attorney who litigated such actions, I believe that HUD could easily sustain a government-wide suspension action against ACORN pending the outcome of a full investigation. The video evidence gathered by O'Keefe and BigGovernment, despite its potential inadmissibility in court, would likely satisfy the lower evidentiary threshold applicable to an administrative suspension proceeding.

All the government need show to prevail against ACORN is that there's adequate information to suspect that grounds for debarment exist and that a suspension is necessary to protect the government interest. Among the grounds for debarment, the easiest to prove would be a lack of business integrity by ACORN that seriously and directly affects its present responsibility.

Sources: http://www2.nbc13.com/vtm/news/local/article/u.s._senator_richard_shelby_wants_acorn_investigation/92206/; http://www.hud.gov/offices/adm/grants/ddfrule.pdf.