Federal Reports

The Office of the Inspector General conducted a review of the Watts Bar Nuclear Plant (WBN) Site Security (SS) organization to identify factors that could impact WBN SS's organizational effectiveness. Our report identified strengths that positively affected WBN SS related to (1) organizational alignment, (2) positive interactions within WBN SS, (3) first-line management support, and (4) positive ethical culture. We also identified risks that could impact the effectiveness of WBN SS to achieve its responsibilities in support of the Nuclear vision and TVA mission. These risks included (1) communication deficiencies, (2) safety concerns, (3) perceptions of inadequate staffing, (4) reporting of performance data, and (5) ineffective relationships with support organizations.

Plant load agreements are special arrangements between the U.S. Postal Service and certain commercial mailers. Mailers interested in establishing a plant load agreement must already have a Postal Service-approved detached mail unit (DMU) at their mailer facility, wherein a Postal Service clerk is on-site performing mail verification, acceptance, dispatch, and other related functions. Mail is then transported from the DMU to a Postal Service facility for acceptance and processing. Our objective was to assess the effectiveness of plant load agreements in the Santa Ana District. We selected this district based on volume and revenue declines from fiscal year (FY) 2018 to FY 2019, totaling 190 million pieces (22 percent) and $37.5 million (18 percent).

During fiscal year (FY) 2019, we issued 32 audit reports related to financial controls at Postal Service retail units. We identified inconsistencies with Postal Service policies for performing financial transactions. The purpose of this report is to bring attention to these issues and make recommendations for corrective action. Our objective was to assess current refund and local purchases and payments policies for retail units and to determine if policies were consistent.

The United States has been grappling with the opioid crisis for several years. In 2018, nearly 47,000 opioid-related overdose deaths occurred in the United States. OIG has been tracking opioid use in Medicare Part D since 2016. In particular, OIG has identified beneficiaries at serious risk of opioid misuse or overdose and prescribers with questionable opioid prescribing for these beneficiaries.

We audited the U.S. Department of Housing and Urban Development’s (HUD) controls over employee benefits expensed at public housing agencies (PHA) due to a previous external review of the Waterbury, CT, Housing Authority, which determined that employee benefits expensed were unsustainable. Our audit objective was to determine whether HUD ensured that employee benefits expensed at PHAs were reasonable.Analysis of PHA data showed that generally, PHAs expensed employee benefit contributions reasonably; however, HUD could strengthen controls in this area. Federal regulations indicate that employee benefit contributions are allowable provided that the benefits are reasonable and are required by law. Further, the average percentage of employee benefits to total compensation for State and local government employees nationally was 31 percent and the PHA data we reviewed showed that employee benefits were generally within the national average. However, 69 of 3,755 PHAs expensed at least $100,000 in employee benefit contributions over 40 percent of total compensation, which may be unreasonable. In addition, PHAs did not always enter accurate financial data regarding employee benefits into the Financial Assessment Subsystem – Public Housing (FASS-PH) system. This condition occurred because HUD did not have specific controls over employee benefit contributions and generally did not review those costs as they were controlled mostly by State laws governing pension plans and negotiated labor union agreements. In addition, PHA financial data received by HUD were at a combined level, which prevented it from easily reviewing benefit costs without having the transaction-level detail required for a meaningful review. As a result, HUD did not have assurance that employee benefit contributions expensed at 69 PHAs were reasonable or that the data entered into FASS-PH were accurate.We recommend that HUD (1) evaluate the risk that employee benefit contributions expensed at PHAs may be unreasonable and (2) develop and implement additional guidance to ensure that PHAs enter accurate employee benefit data into FASS-PH.

The Federal Emergency Management Agency’s (FEMA) Individuals and Households Program (IHP) has no assurance of applicants’ eligibility for Small Business Administration (SBA) Dependent Other Needs Assistance (ONA) payments. According to OMB Circular A-123, Appendix C, when documentation or verification is non-existent to support eligibility payment decisions it must be considered improper. FEMA did not collect sufficient income and dependent documentation or verify self-reported information to determine whether applicants below the income threshold, known as Failed Income Test (FIT), were eligible for SBA Dependent ONA payments. FEMA believed requiring documentation or verification would delay the disbursement of assistance and relied on an honor system to make eligibility and payment decisions. We determined, according to FEMA-provided data, it has paid, and we are questioning, the more than $3.3 billion in improper payments to applicants deemed as FIT for SBA Dependent ONA since 2003. Additionally, FEMA has not evaluated the program risk associated with not collecting or verifying income information. Per Federal requirements, agencies must conduct risk assessments to determine whether programs are susceptible to improper payments. Rather, FEMA assessed IHP at the overall program level and did not specifically evaluate each IHP form of assistance, such as SBA Dependent ONA. These weaknesses have allowed applicants self-certifying income and dependent information to receive less oversight, despite posing the greatest risk for improper payments. FEMA cannot assure Congress and taxpayers it is a prudent steward of Federal resources, and adequately assesses the risks of improper payments. FEMA did not concur with all three report recommendations. Therefore, these recommendations are considered unresolved and open.