Dear Representatives Obey and Lewis, and Senators Byrd and Cochran:

As two organizations which have been critical of earmark abuses, we write to urge you to suspend earmarks to companies currently under federal investigation in the course of the conference proceedings of the 2008 Defense Appropriations Bill. In particular, we are concerned about earmarks directed to ProLogic, Inc. and BAE Systems, two companies which have been reported to be under federal investigations and that are named as earmark recipients in pending House or Senate defense spending bills.

Research by Taxpayers for Common Sense has identified approximately $13 million in six earmarks in the Fiscal Year 2008 House Defense Appropriations bill benefiting ProLogic. Also, BAE Systems has received at least seven earmarks for $21 million in the House version of the legislation and at least three earmarks worth $25 million in the Senate. Since the Senate has not disclosed earmark beneficiaries like the House, we are unable to determine if there are also ProLogic earmarks in the Senate bill.

We are sure you are aware of the recent press coverage relating to these companies. Yesterday, The Wall Street Journal ran a front-page story, “Murtha, Inc: How Lawmaker Rebuilt Hometown on Earmarks; Johnstown Gets Billions With Power Broker’s Aid; FBI Questions a Contract.” The article cited ProLogic, Inc. as under federal investigation for reportedly “diverting public funds to develop commercial software.” ProLogic has at least five facilities located in the districts of members of the House Committee on Appropriations. Last Saturday, in the Lexington Herald-Leader, concerns were raised about three Senate earmarks worth $25 million to BAE Systems, a British defense firm under investigation by the Department of Justice for bribery. The earmarks for ProLogic and BAE are particularly troubling both because of the pending federal investigations, and because the companies both stand to benefit from tens of millions of dollars in earmarks that the Pentagon did not request. In the example of ProLogic, the fact that the CEO’s family owns some of the facilities that the company rents, at a higher than market rate, adds to the concerns of waste, fraud and abuse in its federal contracts.

Public confidence in Congress continues to wane, and wasteful spending and corruption continue to be primary causes of public concern. Suspending these earmarks in the conference process would be an important step in restoring public faith in Congress. By contrast, if these issues are not addressed, the committee will be sending the message that the way to success in getting taxpayers’ money is to put your facilities in key Congressional districts, give campaign donations to those Congressmen, and hope the Congress rewards you despite an ongoing federal investigation regarding possible defrauding of the government and accusations of bribery.

Thanks for your attention on this important matter,

Ryan Alexander, President
Taxpayers for Common Sense

Ken Boehm, Chairman
National Legal and Policy Center