By Sam Wheeler
for the Mail Tribune
An Ashland-based research and development firm that has been under investigation since 2010 for allegedly misusing federal funds and bribing a government official was awarded a $370,000 federal contract in September.
In March, federal agents seized thousands of payroll, tax and personal finance documents, as well as digital data and other items from Sky Research Inc. and its owners, Sky and Anne Sky. Investigators are sifting through the evidence, according to motions granted Nov. 9 in U.S. District Court in Eugene by Judge Thomas Coffin.
The company specializes in aerial mapping, geophysical surveys and remote sensing, and develops equipment for detecting unexploded material. Those products are put to use in decommissioned military ranges and other areas that could harbor live munitions.
The new contract, awarded Sept. 18 by the U.S. Army Corps of Engineers office in Alexandria, Va., is for the development of aerial metallic-detection equipment.
A Corps spokesman, Eugene Pawlik, said it is not unusual for companies to continue to land government contracts while they are under investigation.
“Sky Research Inc. has not been excluded from receiving new contract awards. ” An investigation is not a conviction,” Pawlik said in an email. “The investigation is ongoing, results of the investigation are not complete. Many firms are investigated and continue to receive contract awards throughout the federal government.”
Sky Research was awarded about $160 million in federal contracts from 2004 to 2011, the timeframe in which alleged bribes were paid to a Corps contract program manager in Omaha, Neb., according to two 40-page affidavits filed in U.S. District Court in Eugene in support of search warrants.
No charges have been brought against the Skys or Jerry Hodgson, the Army Corps official with whom the couple allegedly dealt.
Sky was formerly known as William Henry Hovelman Jr., according to a 1989 Josephine County divorce record.
A confidential informant who contacted the U.S. Army Criminal Investigation Command (known as CID) in September 2010 sparked the investigation, according to the affidavits.
According to one of the affidavits, filed March 12 by former CID Special Agent Jason Loeffler, multiple Sky Research employees allegedly knew that Hodgson was fixing bids for the company and providing insider information about how much to bid.
Emails seized by federal agents allegedly show Hodgson and the Sky Research employees discussing, before a bid opens, how much money the company would like to receive to fulfill an upcoming contract in order to exaggerate the size of the project and increase its profits, according to the March affidavit.
According to an affidavit filed July 2 by CID Special Agent Derek Lindbom, an investigator on the case, about 99 percent of Sky Research’s contracts are with the U.S. government.
Hodgson maintained a close relationship with the Skys, who allegedly hired three personal assistants over a span of eight years to fulfill sexual favors for him, the affidavits state.
Hodgson’s alleged insider help on the bids was so well known within the company that some employees used the term “Jerry-ing it” when referring to an upcoming contract the company intended to fix, according to Loeffler’s affidavit.
Hodgson oversaw eight contracts totaling more than $159 million awarded to Sky Research, Lindbom’s affidavit states. Most of the projects are outstanding, but the federal government has paid the firm at least $21.9 million to date, it said.
In March, authorities seized property from Sky Research’s Ashland facility, at 445 Dead Indian Memorial Road, a hangar at the Ashland Municipal Airport and one of the company’s hangars in Englewood, Colo., as well as the Skys’ residence in Ashland, in the 1000 block of East Main Street.
The two affidavits cite bribery, false claims, conspiracy to defraud the United States, wire fraud and unlawful release of sensitive procurement information as suspected crimes.
Reach Ashland Daily Tidings reporter Sam Wheeler at 541-499-1470 or email@example.com.
This story originally appeared in Medford Mail Tribune.