Google Inc (NASDAQ:GOOG) executives have saved as much as $5.3 million buying jet fuel at a government price that they weren’t entitled to, according to NASA’s inspector general Paul K. Martin. He says that while there doesn’t appear to have been any intentional misconduct, the company that manages Google’s fleet of jets “nevertheless received a monetary benefit to which it was not entitled” which has “engendered a sense of unfairness and a perception of favoritism,” reports Mark Maremont MarketWatch.
Google execs based jet fleet at NASA-run airfield
H211, the company that manages jets and helicopters for Google co-founders Sergey Brin and Larry Page along with Google Inc (NASDAQ:GOOG) Chairman Eric Schmidt, made a deal in 2007 to base the fleet at NASA-run Moffett Federal Airfield and buy jet fuel at government prices, which are below market prices thanks to subsidies, in exchange for letting NASA use the fleet free of charge for research purposes. If the deal sounds highly unusual, that’s because it is.
Now it seems that the Pentagon, which supplies the subsidized fuel, was under the impression that the discounted fuel was only being used for NASA flights and that H211 was paying market prices when using the jets in a private capacity. Also, the research activity that Google promised NASA is just a sliver of the fleet’s total flights according to Federal Aviation Administration records. The deal was ended on August 31.
Military unknowingly subsidized private flights by Google execs
The idea that part of the military budget was used to subsidize wealthy jet-setters has of course rankled plenty of people. Senator Charles Grassley (R-Iowa) said that the deal was a “corporate giveaway” and that the “obvious remedy would be for NASA to seek repayment for the taxpayers for the fuel benefit.”
H211 had a contract that it thought was legitimate, and so far there’s no reason to assume that Google Inc (NASDAQ:GOOG)’s founders even concerned themselves with the exact terms of the deal, but for a company whose motto is “Don’t be evil,” saving money on the taxpayers’ dime is in pretty poor taste. H211 exec Kevin Ambrose has said that the company is reviewing the situation, though it’s already had five months to come up with an appropriate response.
