Dive Brief:
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The Department of Energy’s Office of Inspector General (OIG) released a report April 26 on alleged budget violations at the department's Office of Electricity Delivery and Energy Reliability (EDER).
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OIG said that while it is not within its authority to determine if such a budget violation occurred, its test work confirmed that the DOE obligated approximately $16 million more than was apportioned by Congress in fiscal year 2017 for direct funding in the EDER account.
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The OIG said that while the DOE’s deputy chief financial officer has given OIG conflicting reports about whether or not a review of the alleged violation has been completed, OIG is “unable to substantiate” if there was an attempt at a coverup. However, it did find that failures in training, communication, and high levels of staff turnover contributed to the error.
Dive Insight:
DOE budget discussions under the Trump administration have often been problematic or contentious. In April, DOE Secretary Rick Perry came under tough questioning when he testified before a House energy subcommittee on the agency’s proposed budget for fiscal year 2019.
The OIG report, however, highlights a different class of budget concerns on the secretary’s desk. While the report starts with budget issues, it goes beyond financial matters and touches upon management concerns.
The OIG report relates to Anti-Deficiency Act violations, specifically that EDER allegedly obligated more funds than permitted by existing Congressional apportionments. OIG said it “substantiated” the allegation that the DOE obligated $16 million more than was apportioned for the specific EDER account reviewed.
The OIG investigation determined that the office of the CFO made a clerical error on the EDER account, marking a request for $23 million as reimbursable work rather than direct funding, as intended. DOE officials continued to apportion funds to that account through the fiscal year until $214 million was obligated, an amount $16 million above the approved threshold.
The office of the CFO tried to correct the error by reapportioning funding between direct funds and reimbursable work, but the Office of Management and Budget (OMB) told the office of the CFO that it could not accept updated information because the accounting period was closed.
The office of the CFO was eventually able to correct the error by coordinating with EDER and National Energy Technology Laboratory officials to de-obligate four transactions, reducing the amount of funds in the EDER account below the approved apportionment threshold.
The OIG report said that, in accordance with DOE policy, the decision about whether an alleged Anti-Deficiency Act violation occurred rests with the office of the CFO and the general counsel.
The OIG report also focused on the processes in place within different offices at the DOE. OIG said its investigators received conflicting information from the office of the CFO on the status of their review of the overallocation. Staff in the office of the CFO told OIG investigators they were unaware of their responsibilities related to identifying and reporting the potential Anti-Deficiency Act violation.
The OIG determined that “weaknesses related to the Department’s internal control environment” contributed to the alleged violation and the inability to resolve the issue in a timely manner.
There were indications that officials within the office of the CFO were “not always adequately trained and/or had the necessary experience,” the OIG report said, raising concerns about the level of staff turnover and management’s receptiveness to feedback from employees. The report said that individuals within the office of the CFO indicated that “senior management did not value or want feedback from employees on potential weaknesses or process changes.”
Calls to the DOE for comment were not returned by press time.