Office of the Inspector General Semiannual Report to Congress (NUREG-1415, Vol. 12, No. 2)
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Manuscript Completed: April 2000
Date Published: April 2000
Reporting Period: April 1, 1999 - September 30, 1999
Office of Inspector General
U.S. Nuclear Regulatory Commission
Washington, DC 20555-0001
The following two sections highlight selected audits and investigations completed during this reporting period. More detailed summaries appear in subsequent sections of this report.
The Office of the Inspector General (OIG) initiated a review of the license fee development methodology used by the U.S. Nuclear Regulatory Commission (NRC). The NRC is required to recover 100 percent of its budget authority, less the Nuclear Waste Fund and General Fund appropriations, by collecting fees from its licensees. The OIG's review confirmed a previously reported noncompliance in the fee development process, and identified a potential noncompliance with the intent of the Omnibus Budget Reconciliation Act of 1990. The OIG also identified weaknesses in the methodology used to develop fees. Strengthening the management of the fee setting process would help to ensure that the fees developed by the NRC fully meet the intent of the applicable laws and regulations. The OIG's report made eight recommendations for corrective actions.
In 1998, the OIG surveyed the NRC staff's perception about the agency's safety culture and climate. Based in part on the survey results, the OIG performed a special evaluation of the role and structure of the NRC's Commission. The objective of this evaluation was to identify ways that the Commission could enhance its effectiveness. The evaluation identified that (1) from time to time, Commissioners interpret their roles and that of the Chairman differently, which can adversely affect the Commission's collegiality; (2) the Commission has not memorialized goals and objectives specific to its role and structure; (3) staff perceptions identified in the OIG survey that senior management lacks trust in their judgment and the agency lacks a clear sense of direction is influenced in some part by the large size of the Commissioners' and Chairman's staffs and the structure of the Executive Council; and, (4) new Commission members and their staffs do not receive a formal orientation. As a result, the OIG identified five matters that the Commission should consider to enhance its effectiveness.
In accordance with the Chief Financial Officers Act of 1990, the OIG contracted with an independent public accounting firm to audit the NRC's Principal Financial Statements for Fiscal Year (FY) 1999. The auditors issued an unqualified opinion regarding the Balance Sheet and the Statements of Changes in Net Position, Net Cost, Budgetary Resources, and Financing. However, the auditors concluded that management's assertion was not fairly stated, because management did not identify as material weaknesses the lack of (1) managerial cost accounting, (2) a program cost accounting system, and (3) management controls for license fee development. The auditors also identified seven new reportable conditions, and closed one prior-year reportable condition. In addition, with regard to the NRC's compliance with laws and regulations, the auditors carried over two noncompliances from the FY 1998 audit and newly identified a third. Two of the three are considered substantial noncompliances with the Federal Financial Management Improvement Act of 1996.
In 1994, the NRC began to integrate the support of the agency's numerous computer systems into a single contract through the Comprehensive Information Systems Support Consolidation (CISSCO) program. The NRC contracted with the General Services Administration (GSA) to procure and manage the services required under CISSCO. In June 1998, the OIG surveyed the program, and reviewed the agency's controls over CISSCO funding. These activities raised questions about the adequacy of related management controls. Subsequently, the OIG initiated a review of the quality, timeliness, and reasonableness of the costs for work performed under CISSCO. In general, the OIG found that, while improvements can be made, the agency has established an adequate process to ensure that quality products are delivered in a timely manner. In contrast, the OIG found that the NRC has not provided the same degree of assurance with regard to the cost of work performed under CISSCO. Additionally, the OIG found that the skills and experience levels of CISSCO Task Managers vary widely, and many do not feel that they are sufficiently trained to effectively manage information technology work. Finally, the OIG found that the agency had not formally evaluated the performance or effectiveness of GSA's involvement in the CISSCO program. In response to these issues, the NRC's Office of Administration formed a task group to develop guidance regarding the award and administration of the NRC's Interagency Agreements, such as that with GSA. The OIG's report made three recommendations to improve the CISSCO program.
The electric utility industry is experiencing complex new business arrangements, including sales, mergers, and early shutdowns of nuclear power reactors. In response to many concerns related to these events, the OIG initiated an audit of the NRC's decommissioning fund program. The objectives of this audit were to assess the adequacy of the NRC's (1) review of the licensees' decommissioning fund status reports, and (2) formulas for estimating total decommissioning costs. This assessment disclosed that management controls over the process need improvement. Specifically, existing controls failed to ensure data accuracy. As a result, the usefulness of the accumulated decommissioning data is limited. The OIG also believes that the NRC should reassess the reasonableness of its decommissioning formulas. Specifically, the agency should evaluate the relationship between the formula-based and site-specific estimates, and should consider using the site-specific data from the licensees to help reassess the reasonableness of the formulas. The OIG's report made four recommendations for improving the agency's decommissioning fund program.
The OIG conducted an inquiry into systemic problems discovered in applying travel procedures at the NRC's regional offices. This inquiry revealed that NRC travel personnel improperly interpreted the agency's temporary duty (TDY) policy when they authorized the use of privately owned automobiles (POAs) for government travel solely on the basis of a comparison of the costs of airfare and POA mileage. The OIG also learned that the NRC did not consider the availability and cost of a government contract rental vehicle as an alternative before authorizing or paying POA mileage and determining the maximum amount that would be paid to the traveler for POA mileage as required by the Federal Travel Regulations. In addition, the OIG found that the government would have realized savings if the NRC had used the cost of a government contract rental vehicle to determine the maximum amount of POA mileage to pay the traveler.
The OIG conducted an investigation into information that an NRC contractor, detailed to a region, submitted false time and attendance (T&A) documents to the contractor's corporate office for work performed on an NRC contract. In addition, the OIG looked into an allegation that the contractor's supervisor, an NRC regional employee, was aware of and condoned the submission of the false timecards. OIG's investigation determined that the NRC contractor submitted time sheets to the corporate office containing times and dates which the contractor did not work. The OIG also determined that the regional supervisor's responsibilities did not include reviewing or confirming the accuracy of the hours on the contractor employee's time sheets.
The OIG conducted an investigation regarding information that an NRC employee fraudulently charged work absences to a T&A leave category designated for authorized leave related to workers' compensation (continuation of pay). This investigation revealed that the employee had not submitted the required documentation and had not obtained Department of Labor approval of workers' compensation status for a medical condition associated with carpal tunnel syndrome. The OIG also found that the NRC supervisor, who also served as the employee's T&A certifying official, did not verify the accuracy of the employee's time records before signing them.
At the request of a member of Congress, the OIG conducted an investigation regarding an NRC response to questions that the Congressman posed to the former NRC Chairman. The Congressman was concerned that the NRC provided him with inaccurate or misleading information regarding the events surrounding the release of a draft Office of the Secretary of the Commission (SECY) paper on generic communications to the Nuclear Energy Institute (NEI). The OIG investigation revealed that the NRC's letter to the Congressman contained certain inaccurate and misleading information with respect to the timing of the NRC staff's release of the draft SECY document to the NEI and the public.
The OIG conducted an investigation into information that a former NRC regional division director may have engaged in post-employment negotiations with a consulting firm while still employed by the NRC. In addition, the information alleged that the former director may have participated in regulatory activities that may have had a direct effect on the financial interest of the consulting firm. OIG determined that the former NRC director engaged in post-employment discussions with the owner of the consulting firm while still employed by the NRC to perform contractual work for an NRC licensee. However, the OIG determined that the former NRC director did not render any advice or make any recommendations concerning the licensee subsequent to engaging in post-employment discussions with the consulting firm.