Audit finds DOE made excessive payouts to some contractor workers

The Department of Energy has paid excessive amounts to some contractor workers who temporarily are assigned to provide expertise in Washington, D.C., according to a DOE Office of Inspector General audit report released Monday.

The audit looked at five national laboratories, including Pacific Northwest National Laboratory in Richland, which together had 96 employees temporarily assigned to the Washington, D.C., area in fiscal 2011. It also looked at the costs of assignments in fiscal 2012, which was more than $37 million, all of which was reimbursed by DOE.

Workers could receive coverage of certain living expenses, or per diem, and also relocation expenses.

In about a third of the cases reviewed, workers temporarily assigned to Washington, D.C., were paid at least $230,000 in relocation expenses in addition to extended per diem allowances, according to the report. Relocation expenses included shipment of household goods, travel of family members, temporary storage of property and property management services.

Such allowances appeared excessive, the audit said, although DOE clarified its policy guidance while the audit was being conducted.

Per diem varied widely, the audit found. PNNL was at the low end of the scale, authorizing up to $59,556 per individual, while Sandia National Laboratories in New Mexico authorized up to $81,215, a difference of more than $21,000, the audit found.

The five national labs differed on what percentage of lodging, meals and incidental expenses were paid and whether payments were made to offset taxes applied to the payments, according to the report. For instance, PNNL paid its employees 85 percent of lodging, while Sandia compensated 55 percent of lodging, meals and incidental expenses, plus it offset taxes.

In 25 cases, employees were paid about $27,000 to travel back to their national lab while at the same time receiving per diem for their temporary assignment in Washington, D.C., the report said. In 14 cases, totaling about $61,000, workers were paid per diem allowances that exceeded their labs' per diem limits.

DOE programs were required to conduct cost comparisons and show that critical expertise is not already available and that bringing a worker temporarily to Washington, D.C., would be done at a reasonable cost. In most cases the audit found only vague justifications or a failure to document information. In addition, costs were not reviewed to ensure they were reasonable and in line with original estimates.

"As a result, the department lacked assurance that the cost of technical and program support provided by the facility contractor personnel assigned to Washington was both reasonable and necessary and that this approach was the most efficient, least expensive means of obtaining needed skills," the audit said.

The audit was a follow up to a 2005 audit report that raised concerns about the management of contractor workers assigned to DOE offices in Washington, D.C. While some improvement was identified, the average annual cost per worker assigned to Washington, D.C., in fiscal 2011 was about $306,000, which was about $59,000 more than the cost identified in the 2005 report.

Costs of the individual cases considered in the audit could have been reduced by almost $500,000 if payments had been limited to amounts allowed in a National Nuclear Security Administration directive and a DOE letter issued while the audit was being conducted.

Among changes are limiting employees to temporary relocation payments or extended per diem, but not both. Employees receiving temporary relocation expenses cannot be paid for personal trips to their permanent home.

Among the audit's recommendations are improving the accuracy and capability to track the length and cost of assignments and improving cost comparisons. DOE generally agreed with the recommendations.

-- Annette Cary: 582-1533; acary@tricityherald.com; Twitter: @HanfordNews