Note: This is a transcript of questions asked by Senator Joseph Lieberman (D-CT) of Mr. Joe Allbaugh, nominee for director of the Federal Emergency Management Agency, about his involvement in an investigation of the SCI Corporation by the Texas Funeral Services Commission. Certain exclamations and pauses such as "uh" were omitted for clarity.

Sen. Lieberman: Mr. Allbaugh, I think you know there's a lawsuit in Texas which has raised some controversy and questions which some have directed toward your nomination. And I wanted to ask you some questions about it here. I know that the committee has asked you some before the hearing and I appreciate your cooperation in answering those but I think it's important to get some questions and answers on the record. For the record, as I'm sure you know a lawsuit is pending in Texas regarding an investigation by the Texas Funeral Services Commission into the activities of a major funeral home corporation called Service Corporation International -SCI. The lawsuit alleges that the executive director of the funeral commission Ms. Eliza May was wrongfully terminated because of her role in the investigation of SCI -the funeral corporation. Some of the allegations in this lawsuit involve incidents that occurred during meetings and conversations in which you were involved as Governor Bush's chief of staff. I want to ask you a few questions about that now and I'm going to be as, as direct as possible.

Did you ever try as is alleged to stop the Funeral Service Commission investigation of SCI and its related entities from going forward?

Mr. Allbaugh: No sir. I did not.

Sen. Lieberman: And if you want to add any more as we go on, I invite them. I'll go through the questions. Did you ever limit or try to limit the scope of the records or other materials that the Texas Funeral Services Commission was seeking from SCI or its related entities as part of this investigation?

Mr. Allbaugh: No sir I did not.

Sen. Lieberman: Did you ever speak to Ms. May about this investigation or related events in a threatening manner?

Mr. Allbaugh: No sir I did not. I invited her to my office as I did with a lot of executive directors as part of my role as chief of staff and we had a conversation-albeit a brief conversation-but I would not do any such thing.

Sen. Lieberman: Have your actions in this matter ever been the subject of any ethics, criminal or similar type of investigation?

Mr. Allbaugh: No sir they have not.

Sen. Lieberman: And I understand that though you are mentioned in the lawsuit you are not a named defendant in the lawsuit. Is that correct?

Mr. Allbaugh: That's my understanding as well

Sen. Lieberman: Let me ask you finally, having asked those specific questions, if you would now just for the record, to the best of your recollection, state the nature of your involvement in the situation in the case that, that is the basis for the lawsuit that I have mentioned.

Mr. Allbaugh: I was asked by a state senator from Houston to facilitate a meeting-actually attend a meeting he was having-and on a Friday I believe about three years ago. He had invited representatives from the Texas Funeral Commission and SCI to be in attendance. I told him I couldn't be in attendance. In another of the building I was due to do some things with Governor Bush and I couldn't leave. But I offered up my office as a place to host the meeting. Everyone congregated. I turned to Senator Whitmire who was the senator who asked for the meeting and I basically said, "Show's yours."

Sen. Lieberman: Let me interrupt just for a moment. Do I understand correctly Senator Whitmire asked for the meeting because he was concerned about the way in which the Funeral services commission was going after SCI.?

Mr. Allbaugh: The way he explained it to me was that there were numerous documents that the Texas Funeral Service Commission were after. And his constituents, SCI, were curious in trying to figure out exactly what documents the Texas funeral commission were after. That was the purpose of the meeting to try to bring some conclusion and finality as to what they were after. I saw my role quite frankly no more than a facilitator which is something I did with great regularity as the chief of staff when there were two parties that had differing opinions about things.

Sen. Lieberman: And what, what happened at the meeting?

Mr. Allbaugh: Probably ten, twelve, fifteen people showed up. It went on it seemed like forever. And I brought the meeting to closure by asking the chairman of the funeral services commission, who was present, Dick McNeil and his staff to ultimately provide a list of materials they were interested in obtaining from SCI. They agreed to do that. They provided that later in the afternoon after the meeting adjourned and that was the end of it.

Sen. Lieberman: Did you have any further contact with the matter after that?

Mr. Allbaugh: I called the executive director which was normal course of business for me to set up a meeting. I noticed in the larger meeting with everyone present she wasn't participating and that was a clear signal to me that there might be something that this office needed to know about-- the governor's office. So I set up a private meeting. She came over and there wasn't really anything she shared with me-that was the end of the meeting. And that was the last time I spoke with her.

Sen. Lieberman: And the tenor of the mood of that meeting was businesslike and …

Mr. Allbaugh: It was businesslike, short sweet to the point. Actually she was non-participatory in any questions that I asked except for she alluding to the fact that there were several death threats against members of the commission. And I suggested to her that we needed that information as quickly as possible to turn it over to the proper authorities -the Texas Public safety department and uh...

Sen. Lieberman:(inaudible)

Mr. Allbaugh: And the Texas Rangers… I beg your pardon?

Sen. Lieberman: And in her opinion the death threats were related to the investigation of SCI?

Mr. Allbaugh: That was her opinion. And I needed that information to turn over to the proper authorities-the Texas Rangers-for investigation.

Sen. Lieberman: Did she ever provide you with that information?

Mr. Allbaugh: No sir she did not.

Sen. Lieberman: After that meet…. And that was Ms. May I gather?

Mr. Allbaugh: Yes sir.

Sen. Lieberman: After that meeting did you have further involvement in that matter?

Mr. Allbaugh: Only one additional meeting. Chairman Dick McNeil dropped by at his request to bring me kind of an update as to the status of things. And that was my last involvement with this entire issue.

Sen. Lieberman: To the best of your recollection what was the nature of the investigation and how did it conclude?

Mr. Allbaugh: I believe there was a fine involved. And uh which has been appealed. And I really don't know that it's been brought to closure quite frankly.

Sen. Lieberman: But, but the basic nature of the investigation presumably was that there had been complaints against the, the funeral home or the …

Mr. Allbaugh: As I understand it there were complaints against SCI for some type of educational practices. I really don't know any more than that. And the basis for the investigation as I understand it by the Texas Funeral commission was to get at the core of those complaints.

Sen. Lieberman: Do you know … I gather…Is it a fact to the best of your knowledge that Ms. May was terminated as the executive director of the funeral services commission?

Mr. Allbaugh: That's my understanding. I read about it in the "Austin American Statesman."

Sen. Lieberman: Right. Was it.. I'm tempted to ask you if you believe everything you read in the "Austin American Statesman?"

Mr. Allbaugh: Parts… Parts… Parts…

Sen. Lieberman: Do you remember how soon after, generally speaking, after this series of events regarding SCI that Miss May was terminated?

Mr. Allbaugh: (sigh) I wanna say 5 or 6 months, I don't exactly know, …No my meeting with Ms. May was in August of '98 and I think she was terminated in early '99.

Sen. Lieberman: Did you have any involvement in the commission's decisions that led to her termination?

Mr. Allbaugh: None whatsoever.

Sen. Lieberman: So that what you are testifying today is the first time you heard about it to the best of your recollection was that …when you read about it in the newspaper

Mr. Allbaugh: That's exactly what I would say. The first time I ever heard about her dismissal was reading about it in the newspaper

Sen. Lieberman: Fine. Thank. Thanks, Mr. Allbaugh. I don't have any further questions about that. I believe some of my colleagues in some of the post hearing questions may.

Mr. Allbaugh: Sure