Federal Reports

The In-Office Cost System (IOCS) is the U.S. Postal Service’s primary probability sampling system used for estimating the cost of processing mail and parcels. The data collected from IOCS enables the Postal Service to allocate the labor costs from the handling of mail, parcels, and related activities performed by clerks, mail handlers, city carriers, and supervisors to all mail classes and rate categories. The Postal Service uses the data collected from IOCS to allocate about $21 billion per year in costs to mail products. The Postal Service uses the allocated costs to each mail category collected from IOCS to determine prices. Therefore, collecting consistent, accurate data is essential.

This semiannual report informs Congress of the Peace Corps Office of Inspector General's work from October1, 2024, through March 31, 2025.

As part of our annual audit plan, we performed an audit of costs billed to the Tennessee Valley Authority (TVA) by Terracon Consultants, Inc. (Terracon) for geotechnical and hydrogeological site investigations and groundwater quality monitoring services under Contract No. 15087.  Our audit objective was to determine if costs were billed in compliance with the contract’s terms.  Our audit scope included $9.93 million in costs paid from January 3, 2022, through October 21, 2024.

In summary, we determined Terracon overbilled TVA an estimated $387,879, including (1) an estimated $304,431 in overbilled labor costs (of which TVA has recovered $3,164), (2) $81,898 in ineligible subcontractor markups, and (3) $1,550 in overbilled travel costs.  In addition, we identified instances where meals and incidental costs associated with travel were not billed in accordance with the contract, resulting in a net immaterial overbilling.  We also found TVA did not include a pricing schedule containing the time and material billing rates until March 28, 2024, although the contract was effective July 13, 2020.