A FEMA Contractor Was Paid Through a DOGE Staffer's Company. Her Deposition Is Now Public.

The rule against using contracts for inherently governmental functions is one of the least discussed protections in the federal workplace, and a newly public deposition in the FEMA litigation is about to put it in front of a judge. The witness is the outside contractor CNN described as FEMA’s “shadow administrator.” Her testimony, taken under oath and filed in the union’s case before Judge Illston, describes how she was paid, who briefed her, and what she says she was and was not doing there.

Federal employees who lived through last year’s reductions at FEMA have been asking who was actually making the decisions. This deposition is the first sworn account from inside that answer.

What the Deposition Says About the Money

According to the deposition testimony, the arrangement changed in October 2025, when her special government employee status ran out. She testified that she then formed a company — in her words, “an LLC that I formed for this purpose.”

That company subcontracted to AnchorCode Technologies. Asked who owned AnchorCode, she identified Kyle Schutt. Asked whether Schutt was DOGE, she testified: “he was with DOGE. That’s my understanding, yes.”

She testified that she billed $325 an hour, tracked her time on an Excel spreadsheet, and emailed her timesheets to Schutt. Asked who at DHS approved that arrangement, she testified: “I do not know.”

Her title throughout that period was senior advisor to the Secretary of Homeland Security.

Where the FEMA Information Came From

The second thread in the testimony is informational rather than financial. She had never worked for the federal government and had no disaster background. Asked how she came to understand FEMA, she testified that she recalled “Kyle Schutt having provided most of the information from things they had collected from DOGE.”

What she described receiving was not general background. It was financial statements and organizational charts — how the agency was built, and where its people were.

She also testified that she was not a subcontractor to DOGE and was not brought in to downsize anything.

Contracts Cannot Perform Inherently Governmental Functions

The Federal Acquisition Regulation states the principle plainly. Under FAR 7.503(a), “Contracts shall not be used for the performance of inherently governmental functions.” The illustrative list at FAR 7.503(c) includes, at subsection (c)(7), “The direction and control of Federal employees.”

That is the legal frame this testimony will be measured against. It is worth being precise about what has and has not happened: no court has ruled that this arrangement crossed that line. That question belongs to Judge Illston, briefing is complete, and argument is set for September 1. Everything above is what a witness said under oath, not a finding.

What This Means if You Are a FEMA CORE Employee

If you are a FEMA CORE employee whose appointment was not renewed, this litigation may develop facts that matter to you — but your own file is the thing you control right now.

• Save your non-renewal notice. Keep the original document, not a summary of it.
• Save the date. The date you received the notice starts clocks that do not restart later.
• Save the emails on either side of it. What came before and after a non-renewal is often more probative than the notice itself.

There is an important distinction in how these cases get framed. A non-renewal challenged purely as a term-expiration dispute is one legal route. A non-renewal that followed your report of something — a safety problem, a legal violation, waste or fraud — is a different route entirely, with different elements and different deadlines. Which door you are standing in front of depends on facts you may be the only person holding.

Practical Takeaway

Two things are true at once. The public record here is genuinely significant, and it is also not a ruling. The most useful thing most federal employees can do with a story like this is not to wait on the court — it is to make sure their own documentation is complete while the events are still recent and the people involved are still reachable.

If your separation or non-renewal is connected to the FEMA restructuring, or if you reported something and a personnel action followed, the federal employee lawyers at Southworth PC offer free consultations and can help you sort out which route actually fits your facts.

Legal Disclaimer: This content is for general informational purposes only and does not constitute legal advice. Federal employment situations are fact-specific and time-sensitive. Please consult a qualified federal employment attorney about your specific situation.