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Inspector general Rehnquist resigns

WASHINGTON — Janet Rehnquist, inspector general of the Health and Human Services Department, resigned Tuesday night in the face of congressional opposition and a wide-ranging inquiry into her conduct.

Rehnquist, daughter of Chief Justice William H. Rehnquist, reluctantly bowed to pressure from Sen. Charles E. Grassley, R-Iowa, and Sen. Max Baucus, D-Mont., the chairman and the ranking member of the Finance Committee.

Rehnquist, whose responsibilities included rooting out fraud and waste in Medicaid and Medicare, came under lawmakers' scrutiny shortly after President Bush appointed her in August 2001.

Senators questioned numerous aspects of her conduct, including replacing a score of experienced managers, her unauthorized possession of a gun in her office and her request to delay a federal audit of the Florida state employees' pension fund, in possible deference to Gov. Jeb Bush of Florida.

At senators' behest, the General Accounting Office is reviewing her record, as well as concerns that her office improperly shredded documents that investigators sought.

In a letter to Bush on Tuesday night, Rehnquist said that she was stepping down "to spend more time" with her teenage daughters and to "pursue other professional opportunities."

Rehnquist, who supervised a staff of 1,600 in charge of $530 billion in federal spending, said her efforts had saved more than $21 billion in her first year in office.

"I am proud of the record of accomplishment during my tenure," Rehnquist wrote. "This was the best year ever for the office."

The secretary of department, Tommy G. Thompson, issued a statement that called Rehnquist "a dedicated, passionate and compassionate public servant."

But Rehnquist's poor standing in Congress had undermined her effectiveness, officials there said. In January, Baucus privately notified the White House that he would give Rehnquist two months to resign. Faced with her resistance, he had planned to issue a public call on Thursday, officials said.

Grassley never issued such an ultimatum, aides said, though he welcomed the outcome.

"This is the right step," he said in a statement. "The inspector general job wasn't a good fit for her abilities. It's very important that we get a bulldog for the taxpayers on the job."

Congressional officials said that Baucus and Grassley were troubled by Rehnquist's decision to dismiss or reassign 19 senior executives with broad experience in investigating fraud and waste.

The GAO is investigating whether Rehnquist acted under pressure when she interceded on behalf of a Pennsylvania hospital accused of filing false Medicare claims or when she delayed the pension fund audit that ensured that the review would not be completed before Jeb Bush had been re-elected.

Rehnquist's possession of a gun in her office also drew scrutiny. She was not authorized to have the weapon, which had no trigger lock. She kept a paper target on her wall.

Soon after it began its inquiry in November, the accounting office received reports that Rehnquist's office had improperly shredded documents. By the end of the month, Rehnquist's chief counsel had ordered employees to stop destroying all documents until further notice.

Jeff Nelligan, a spokesman for the accounting office, the congressional oversight agency, said he did not know whether the inquiry would continue.