Federal Reports

As required by the Accountability of Tax Dollars Act of 2002, the Peace Corps prepared its financial statements and subjected them to audit in accordance with the Office of Management and Budget (OMB) Circular No. A-136, Financial Reporting Requirements. Peace Corps OIG contracted with Williams, Adley & Company-DC LLP, an independent certified public accounting firm, to audit the Peace Corps’ financial statements as of September 30, 2023. The audit was conducted in accordance with auditing standards generally accepted in the United States of America; the standards applicable to financial audits contained in Generally Accepted Accounting Principles, issued by the Comptroller General of the United States; and OMB Bulletin No. 24-01, Audit Requirements for Federal Financial Statements.

In accordance with the Reports Consolidation Act of 2000, the OIG reports annually on the most serious management and performance challenges the Department faces. For FY 2024, we identified seven management challenges for the Department: (1) Implementing pandemic relief laws for elementary and secondary education; (2) Implementing pandemic relief laws for higher education; (3) Oversight and monitoring of student financial assistance programs; (4) Oversight and monitoring of grantees; (5) Data quality and reporting; (6) Improper payments, and (7) Information technology security. The report includes a summary of each challenge, a brief assessment of the Department’s progress in addressing each challenge, and shares information on further actions that, if properly implemented, could enhance the effectiveness of the Department’s programs and operations.

Section 26a of the Tennessee Valley Authority (TVA) Act requires TVA's approval prior to construction, operation, or maintenance of any dam, appurtenant works, or other obstruction affecting navigation, flood control, or public lands or reservations across, along, or in the Tennessee River and its tributaries. Title 18, Code of Federal Regulations (CFR), Part 1304.1 1304.412, Approval of Construction in the Tennessee River System and Regulation of Structures and Other Alterations (18 CFR §§ 1304.1 1304.412) contains regulations related to the application process and information on what is allowable under a Section 26a permit. Additionally, 18 CFR §§ 1310.1–1310.3, Administrative Cost Recovery requires applicants pay TVA fees for its review of Section 26a permit applications. TVA’s Natural Resources group has also established a series of stewardship guidelines to provide guidance for effective, consistent management of TVA reservoir land and natural resources that includes the Section 26a permit process. Due to a concern identified in public comments prior to a TVA Board of Directors meeting, as well as concerns reported to the Office of the Inspector General EmPowerline®, we performed an evaluation to determine if Section 26a permits were being effectively managed. We determined Section 26a permits were not being managed effectively by TVA. Specifically, we found: • TVA is not complying with requirements to recover all the associated cost of permits in accordance with 18 CFR § 1310.3. When costs associated with processing Section 26a permits are not recovered from applicants, TVA’s ratepayers are effectively subsidizing the Section 26a permitting process.• TVA’s oversight of the Section 26a permit process is inadequate. The oversight concerns are related to TVA: (1) performing minimal compliance oversight, (2) not providing oversight to ensure violations and encroachments are addressed in a timely or consistent manner, and (3) inconsistently documenting permit noncompliances as violations and encroachments. • Instances of noncompliance with 18 CFR §§ 1304.1–1304.412 related to permit application requirements and multiple instances of poor recordkeeping. TVA is responsible for managing the Tennessee River system. An important part of that responsibility is to ensure obstructions affecting navigation, flood control, or public lands across, along, or in the Tennessee River and its tributaries are built and maintained to protect the safety of all river users and the environment. TVA manages these responsibilities through the Section 26a permit process. However, based on the issues identified during our review, TVA’s oversight is not adequate to ensure the Section 26a permit process is effective.