Breaking: The LMI Scandal Unfolds

MARAD-directed USMMA Culture Study contaminated by conflict of interest

(This new post fits in with the series we have been running on MARAD’s behind-the-scenes manipulation of Congress to attempt to force Congress to bail out the six state maritime schools by funding a $1.8 billion  fleet of new  training ships and MARAD’s abuse of USMMA’s sea year to aid that effort.  Part 1 described the surreptitious removal of language in a Senate bill that would have authorized “ship sharing” that would protect the state schools in the event one of their training ships was out of service. Part 2 detailed the state schools’  quest to get Congress to fund the $1.8 billion fleet and explained how the ship sharing language undermined the state schools’ efforts to create a crisis-like atmosphere to justify the appropriation and thus had to be removed.   This new information regarding LMI is important enough that it needed its own post. So we’ve expanded the series and this is part 3 of what we hope will be a 4 part series.)

An unexpected result of the impending change in Executive Branch leadership is that administration employees have begun to provide information on our confidential tip line.  This post results from such a tip.

Recall that we knew that MARAD’s “competitive” Request for Quote (“RFQ”) to conduct a “culture” study at USMMA was not competitive and instead was “wired” from the start. Before the bid period had even closed, sources told us that a company named LMI had been pre-selected to get the contract. We posted this information long before the bid was awarded and, unsurprisingly, our sources were right.

When the contract was awarded to LMI, we searched in vain for something that would suggest that LMI had a legitimate reason to get the contract award.  We found no evidence that LMI had any background in the U.S. maritime industry or USMMA. We also found that it had almost no experience dealing with the assessment of cultures for sexual assault/sexual harassment (“SA/SH”).  We scoured the biographies on the LMI website of the LMI management team — directors, officers and program directors — and we were unable to find a natural link between LMI and DOT/MARAD that would explain why LMI was wired for the culture study at USMMA.

So when a tipster wrote on Friday to tell us we should check out the connection between Marlise Streitmatter (Deputy Chief of Staff for former DOT Secretary Ray LaHood) and LMI, we were naturally curious. We were stunned to learn that she not only works for LMI, she is also involved in the USMMA culture study. This certainly suggests the explanation as to how LMI, an arguably unqualified vendor for the culture study, was wired to get the contract award from DOT/MARAD. In addition, Ms. Streitmatter’s involvement in the USMMA culture study is a conflict of interest that undermines the credibility of the study. Here’s why:

Ms. Streitmatter was then-Secretary LaHood’s Deputy Chief of Staff from at least 2009 until mid-2013. She was the number four person in the DOT during her tenure there and was tasked by LaHood to handle the many issues dealing with USMMA. To put this in perspective, Ms. Steitmatter was the Secretary’s point person for USMMA issues when DOT/MARAD:

• Removed RADM Philip Greene  as Superintendent of the Academy
• Closed the Global Maritime and Transportation School (“GMATS”) at the Academy
• Ordered that USMMA’s Melville Hall, Athletic Association and other non-appropriated funding instrumentalities be shutdown
• Hired Chip Jaenichen as Deputy Maritime Administrator
• Ordered the transfer of the T/V Kings Pointer to Texas Maritime, leaving USMMA without a training vessel
• Forced the resignation of MARAD’s Chief Counsel in 2011 for seeking an inspector general investigation into SA/SH at USMMA
• Hired James Helis to replace Greene as the Superintendent of the Academy
• Selected all new members of the Academy Advisory Board and made Sharon van Wyk the chair
• Evicted the USMMA Alumni Association and Foundation under false pretenses

Unfortunately, Ms. Streitmatter’s conflict of interest isn’t limited to just her involvement with MARAD and USMMA. She demonstrated antagonism towards USMMA and its stakeholders during her tenure that establishes that she is biased and cannot be relied upon to act in the best interests of the Academy.  For example, her reaction upon learning that a judge had denied the Alumni Association’s effort to avoid eviction from the Academy’s grounds was:  “Woo Hoo!!!!”

Before the eviction, but while things were still tense between MARAD and the Alumni Association over the removal of Greene, the closure of GMATS, etc., the Alumni Association proposed a meeting with Superintendent Helis for, among other purposes, showing Congress “that there are good working relationships between the AAF and the Academy.”  Showing unity to Congress — the source of funding for the Academy — would normally be considered a positive thing for the Academy.  Helis said that he planned to decline the meeting and Ms. Streitmatter’s response was telling:  “Yes, please decline.”

Another telling conflict of interest lies in the fact that as part of the culture study, LMI is contractually obligated to assess the performance of leadership at the Academy:

“C.1.4 Conduct an assessment of the role of USMMA leadership and management, both historically and currently, in addressing a climate in which sexual assault, sexual harassment, other forms of sex discrimination, retaliation, and related misconduct has persisted.”

See RFQ (emphasis added).

Ms. Streitmatter (and therefore LMI) cannot possibly provide an objective evaluation of leadership at the Academy.  She was intimately involved in the hiring of Helis as Superintendent. She was involved in the much-criticized rewriting of the position description for the Superintendent that eliminated the requirement that the Superintendent have a maritime background (and therefore opened the door for Helis to get the job). After the candidates for Superintendent were narrowed down from over 100 to 3, and after they had been interviewed by three separate panels, the three finalists were subject to one final interview. Ms. Streitmatter was one of the three members of that final interview panel.   The result of that final interview was that Helis got the job.  Thus, Helis’ documented failure to address SA/SH at the Academy is a direct reflection upon Ms. Streitmatter’s performance in evaluating the final candidates for the Superintendent position.

Ms. Streitmatter was on the steering committee for the strategic plan that was criticized throughout the final report of the Middle States Commission on Higher Education (“MSCHE”) accreditation team.  She was involved in the selection of Sharon van Wyk as chair of the Academy Advisory Board.  Van Wyk is the one who conducted an unprofessional, unscientific, and undocumented focus group of midshipmen that was then presented in an undocumented oral report to Secretary of Transportation Foxx that resulted in the standing down cancellation of sea year. Can we really expect LMI to come out with a report — as it should — that says van Wyk’s informal SA/SH study was unreliable and should be ignored, when Ms. Streitmatter was so involved in van Wyk’s selection to be the chair of the Academy Advisory Board?

Incredibly, Ms. Streitmatter was part of the senior leadership at DOT that forced out MARAD’s chief counsel in an effort to avoid an Inspector General investigation into SA/SH at USMMA in 2011.  Does anyone expect LMI to issue a report examining leadership’s role “in addressing a climate in which sexual assault, sexual harassment, other forms of sex discrimination, retaliation, and related misconduct has persisted” that recognizes Ms. Streitmatter’s DOT team’s failure of leadership by trying to cover up SA/SH at the Academy rather than investigate it?

By now, it should be pretty evident that one purpose of the LMI study is to cover up the failure of leadership to address SA/SH at the Academy and provide a counter to the Inspector General and MSCHE Accreditation Reports that criticize that failure.  But, it also seems likely, as we have previously predicted, that the primary purpose of the LMI study is pre-ordained to justify the administration’s sea year stand down cancellation and recommend that sea year on commercial ships be discontinued in favor of sea year on United States owned vessels only.  Regardless, whatever result is finally released, it cannot be relied upon. Ms. Streitmatter’s link between DOT and LMI completely undermines the validity of any conclusion reached by LMI.

Congress and the DOT Inspector General need to investigate every aspect of the circumstances that led to the awarding of the contract to LMI and the conflict of interest that is inherent in having Ms. Streitmatter involved in this culture study.

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As an aside, it is interesting that Ms. Streitmatter’s connection with LMI is difficult to uncover. LMI is not shy about announcing new employees in the news section of its website and one would expect that landing the former Number Four person in USDOT would be worthy of announcement. But there is no announcement to be found on the LMI website. The one blog post Streitmatter made on LMI’s blog has been scrubbed — it’s almost as if LMI wants to make it difficult for someone to find out that Ms. Streitmatter works for it.  But, Google remembers: