An inspector general is investigating Housing and Urban Development Secretary Alphonso Jackson's comments to a business group that he rejected an advertising contract because the contractor had criticized President Bush.

"We have received a number of complaints from the public as well as from members of Congress," Michael Zerega, spokesman for HUD's inspector general, said Friday. "We are reviewing this matter and will look to the facts and any applicable law or requirements."

Jackson issued an apology Wednesday, saying he made up the story. He won Bush's support Friday.

"Alphonso Jackson has admitted that what he said earlier was improper, that it was a mistake and the president accepts that and still supports a man with whom he's had a long and close relationship," White House press secretary Tony Snow said.

Meanwhile, the Congressional Research Service issued a memorandum saying it would violate federal law — and perhaps the Constitution — to deny a contract to someone because of his or her political affiliation. The memo was released Friday by Sen. Frank Lautenberg, D-N.J., who had requested the opinion.

"Contracts may not be awarded on the basis of personal or political favoritism, and all potential contractors should be treated with complete impartiality and with preferential treatment for none," said the memo, signed by John Luckey, a lawyer with the nonpartisan research service.

Jackson told a Dallas business group April 28 about a minority contractor who finally had landed an advertising contract with HUD after trying for 10 years, according to an article in the Dallas Business Journal.

Jackson said that when the man approached him to thank him for the contract, the contractor said he didn't like Bush.

"He didn't get the contract," Jackson told the group, according to the newspaper. "Why should I reward someone who doesn't like the president, so they can use funds to try to campaign against the president? Logic says they don't get the contract. That's the way I believe."

HUD spokesman Jerry Brown said Jackson would cooperate with the investigation.

Zerega said there was no timetable for the investigation. The inspector general, Kenneth Donohue, who does not report to Jackson, has several options if he finds wrongdoing. He could simply issue a report, or he could work with the U.S. attorney's office to seek a criminal indictment.

Several Democrats in Congress had called for the inquiry.

"Secretary Jackson was bragging not only about violating contracting law, but also about violating someone's Constitutional rights," Lautenberg said in a statement. "This is a serious matter and it deserves a serious response from the President."

Christopher Yukins, co-director of the Government Procurement Law Program at George Washington University, said politics is not supposed to play a part in awarding government contracts.

"The basic rule is that procurement decisions have to be based upon reasonable criteria, they have to be based upon reasonable factors," Yukins said. "A purely political decision would not be considered a reasonable factor in awarding a federal contract and it would be simple for the contractor to challenge this as an unreasonable, irrational decision."

Jackson joined the Bush administration in 2001 as HUD's deputy secretary and chief operating officer. He became HUD secretary in 2004.

Before arriving in Washington, Jackson was president of American Electric Power-TEXAS in Austin. Before that, he had been president and chief executive of the Dallas Housing Authority.