VA brass defends demoted Phila. director

Top officials at the U.S. Veterans Affairs Department praised the beleaguered director of its Philadelphia benefits office on Wednesday, describing her as one of the agency's finest employees and questioning claims that she improperly schemed to land an easier job at the same pay.

Testifying before an administrative law judge in Philadelphia, Acting Under Secretary for Benefits Danny Pummill said Diana Rubens, a career VA manager, was the perfect choice to help clean up the problem-plagued Germantown office in 2014.

But Rubens "was extremely conflicted" about the transfer, Pummill said, despite being exhausted after seven years in a demanding senior VA job in Washington. By taking the Philadelphia assignment, "she felt she was letting the agency down," Pummill said.

His testimony came on the first day of a hearing at which Rubens has asked a Merit Systems Protection Board judge to overturn what she contends was unfair disciplinary action stemming from her transfer: a demotion, pay cut and re-assignment to Houston.

After remaining publicly silent for months, Rubens is expected to testify Thursday. Judge William Boulden must issue a decision by Monday.

After a months-long investigation, the VA's Office of Inspector General issued a report in September alleging that Rubens played an active role in encouraging the 2014 transfer of the director of the Philadelphia benefits office. Then, the inspectors said, she arranged her own re-assignment to the position, a job with less responsibilities but the same pay, so she could be closer to family in Delaware.

The report also questioned whether the $274,000 in relocation expenses spent to sell her Virginia home and move her to Havertown amounted to misuse of government funds. Federal prosecutors looked at but declined to take on the case. Still, members of Congress have called for her to be fired.

In their testimony Wednesday, Rubens' current and former supervisors offered accounts of her transfer that contrasted sharply with the ones painted by her critics in recent months. Several described her transfer to Philadelphia as a win-win.

The agency was able to put one of its most adept leaders in one of its most troubled offices, said Gen. Allison Hickey, the agency's Under Secretary for Benefits at the time Rubens was moved. And Rubens was moved to a post she wanted for personal reasons, meaning that she'd perform better than someone who was forced against their wishes, Hickey said.

Hickey, who resigned shortly after the Inspector General's report was released, testified that she was overjoyed when Rubens told her she was willing to go to the under-performing Philadelphia office.

"I went cha-ching, cha-ching," Hickey said. "That works! That works! That works!"

Hickey gave an animated defense of Rubens, explaining that she comes from a military family, is the daughter of a Pearl Harbor survivor, and "cares about veterans."

Rubens, stone-faced during most of the hearing, took off her glasses, picked up a tissue and wiped away tears.

Deputy VA Secretary Sloan Gibson, who meted out the punishment for Rubens, also described her as one of the agency's best employees. But he defended his disciplinary decision, saying Rubens showed "an error in judgment, a serious error in judgment" by remaining involved in the reassignment of her predecessor.

Officially, he charged Rubens with a "failure to exercise sound judgment." Gibson said the demotion - resulting in a $57,000 pay cut, to $123,775 - was an appropriate penalty.

He said he had weighed firing Rubens but did not because he found no evidence that she intentionally manipulated agency employees for her own benefit.

Rubens' lawyers argued that Gibson based his decision on a biased and flawed report from the Inspector General and mounting pressure from members of Congress. Attorney Debra Roth questioned why Gibson, after deciding to discipline Rubens, notified Rep. Jeff Miller (R., Fla.), chairman of the House VA Committee.

"Why do you have to tell Mr. Miller every personnel decision you're taking?" Roth asked.

Gibson said any decisions affecting high-ranking officials are shared with Congress. Outside pressures, he said, had no bearing on his decision.

"I gave them no weight," he said. "We are constantly under fire. Being criticized. Misinformation. Innuendo. If we reacted to every single one of these, all we would be doing is reacting day in and day out."

As for the Inspector General's report, Gibson said he had concerns that the investigation was biased and did not let the findings - that Rubens might have broken the law - impact his decision.

Rules passed by Congress in 2014 ensure that Rubens will quickly get a ruling on her case. Regardless of the judge's decision, she cannot appeal.

In a parallel case, a Chicago merit board judge on Wednesday reversed the VA's attempt to demote and reassign Kimberly Graves, a senior employee also accused of orchestrating her own reassignment.

tnadolny@phillynews.com

215-854-2730 @TriciaNadolny