Air Force Leaders Under Fire for $50 Million Contract

WASHINGTON – A $50 million contract to promote the Thunderbirds aerial stunt team was tainted by improper influence and preferential treatment, a Pentagon investigation found.

In response, Air Force Secretary Michael Wynne took administrative action against Maj. Gen. Stephen M. Goldfein, who was the commander responsible for the Thunderbirds at the time, as well as two others, and referred action on two additional personnel to their commanders, the service said Thursday.

The Defense Department's Inspector General found no criminal conduct, but laid out a trail of communications from Air Force leaders — including from its top officer Gen. Michael Moseley — that eventually influenced the 2005 contract award.

"I am deeply disappointed that our high standards were not adhered to in this case," Wynne said. "This is not how the Air Force does business, and we are taking steps to ensure this doesn't happen again." He wrote to senior leaders telling them they must be scrupulous in avoiding the appearance of favoring contractors.

The report is the latest in a string of problems for Air Force leaders, who have faced questions about the service's handling of nuclear and nuclear-related materials, challenges to a recent $35 billion tanker contract award and anger over their efforts to get more money for the F-22 Raptor.

The report did not find that Moseley, Air Force chief of staff, was personally involved in the contract decision. Instead, criticisms focused on numerous friendly e-mails he exchanged with the eventual winning bidders — communications that may have influenced the decision of the contract team.

The most senior officer reprimanded by Wynne was Goldfein, who commanded the Air Warfare Center at Nellis Air Force Base, Nev., and was responsible for the Thunderbirds. Goldfein receives the bulk of the criticism, for his efforts to get a vote on the contract by the team reviewing the bids.

Goldfein, now vice director of the Joint Staff, also spoke favorably about the winning company, Strategic Message Solutions, to those on the review team. He declined to comment on the report.

"Goldfein's activities displayed a pattern of behavior that gave an advantage to SMS in competing for this contract and so constituted preferential treatment," the report says.

The four others cited in the report were members of the team reviewing the bids. They were the top two contracting officers as well as the commander and narrator for the Thunderbirds at the time. They were not identified.

The Air Force said the assistant U.S. attorney in Nevada declined to pursue criminal prosecution.

The report pointed to irregularities in several other contracts awarded by Air Force officials at the Nellis base.

Wynne ordered a review of contracting processes and a training program to correct problems raised by the investigation.

The investigation began in 2005 with allegations that Moseley and other Air Force officers tried to give the work to Strategic Message Solutions and its president Edward Shipley without going out for bids.

Later, after bids were sought, the company was awarded the five-year, $49.9 million contract. Two losing bidders complained that the company had an unfair advantage, including its decision to make retired Gen. Hal M. Hornburg a partner.

Shipley and Hornburg were among the people who communicated with Moseley.

The Air Force canceled the contract in February 2006 and Wynne directed the Pentagon's inspector general to investigate.

Shipley unsuccessfully sued to reinstate the contract, which was to provide "audio, visual and concert quality sound production presentation" on the Thunderbirds.