Federal Reports

The Office of Inspector General (OIG) conducted this audit to determine if VA adhered to program requirements in using more than $1 billion appropriated by Congress from fiscal year (FY) 2019 through FY 2021 to repair buildings with identified seismic deficiencies in zones prone to earthquakes. The OIG reviewed 92 projects funded during that period and determined 42 of the buildings (46 percent) were nonessential, as opposed to critical buildings that must remain operational during a seismic event. The cost to address deficiencies in these 42 ancillary buildings was around $616 million.According to data from the Seismic Program Office, seismic evaluations had not been performed on 135 buildings considered critical or essential by February 23, 2023. The program office’s approval of funding to address seismic deficiencies in ancillary buildings without first completing all required seismic evaluations in critical and essential buildings increases the risks to veteran and employee safety and impedes the ability to continue to provide lifesaving care during and after an earthquake.The OIG found that the seismic evaluations were not completed because the program office placed a low priority on them and did not assign a deadline for their completion, despite a 2015 OIG audit recommending this issue be addressed. The program office also lacked an effective process for identifying and tracking buildings needing evaluations. Moreover, seismic data in VA’s Capital Asset Inventory—the authoritative record of VA’s real property—were incomplete, outdated, and not accessible to most VA engineering officials.The OIG recommended VA ensure seismic evaluations are done for all critical and essential buildings, work to correct Capital Asset Inventory inaccuracies, and request that seismic designation information be available to facility officials for review as part of their annual certifications of the Capital Asset Inventory.

VA’s Denver Logistics Center (DLC) manages millions of dollars of supplies intended for Veterans Health Administration (VHA) facilities and patients. According to VA policy, VA staff who use, supervise, or control VA-owned goods are accountable for those goods from acquisition to disposition.The VA Office of Inspector General (OIG) audited to determine whether the DLC maintained accurate inventories of VA-owned goods and identified significant deficiencies in inventory management operations and systems. Specifically, the DLC’s inventory records did not align with on-hand supplies or include all goods, and the DLC lacked an effective internal control system. Inaccurate inventories, weak internal controls, and lack of reporting outside of the DLC created the risk of misleading financial reporting and increased costs to VHA. Further, supplies and veteran information kept at DLC warehouses were not physically secured.The audit also revealed the DLC did not have appropriate system controls to protect inventory data. The DLC’s inventory management system software has access and security vulnerabilities and lacked transparency. Like the VA-owned supplies on hand, the DLC system hardware was also vulnerable to physical access and security risks. Overall, the DLC’s inventory ordering system is becoming unsustainable.The DLC has largely operated under minimal oversight of its inventory operations, and the OIG found that oversight to be ineffective at ensuring VA policies were followed and VA-owned goods protected. The independent nature of DLC operations, along with the deficiencies identified in this audit, impedes the DLC from effectively fulfilling its mission and creates a heightened risk of fraud, waste, and abuse.VA concurred with the OIG’s 11 recommendations to improve the inventory management operations and oversight of the DLC and with another eight recommendations that address information system deficiencies.

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We found that a former BIA employee defrauded the Government through misuse of Government credit cards and other misconduct.

What We Looked AtSince 2014, the Federal Aviation Administration’s (FAA) Airport Improvement Program has obligated more than $3.18 billion to eligible airports each fiscal year for airport development and planning. At the direction of Congress, FAA published its Policy and Procedures Concerning the Use of Airport Revenue (Revenue Use Policy) to define airport revenue and identify permitted and prohibited uses of that revenue. FAA amended this policy in 2014 to address revenue use for aviation fuel taxes. Given the importance of promoting effective stewardship of taxpayer dollars used to support the Nation’s airports, we initiated this audit. Our objective was to assess whether FAA’s oversight policies and procedures are sufficient to prevent or detect airport revenue diversion. For this audit, we focused on FAA’s efforts to ensure compliance with FAA’s rules for collecting and using aviation fuel taxes. What We FoundSince amending its Revenue Use Policy, FAA has made progress confirming whether State and local Government laws comply with the amendments. However, the Agency has not yet tested or validated if the compliant jurisdictions use the proceeds from aviation fuel taxes according to the jurisdictions’ approved action plan. Without testing the jurisdictions’ approved action plan for using aviation fuel taxes, FAA cannot ensure that revenue is used for aviation‑related purposes as required by Federal regulations. In addition, the Agency has not taken enforcement actions against the five jurisdictions that are not yet in compliance with the amendments. According to Agency officials, the lack of testing, validation, and enforcement action is due to congressional guidance that encouraged the Agency to postpone enforcement. By potentially diverting aviation fuel tax revenue from airports for non‑aviation-related purposes, these jurisdictions increase the risk of hindering the airports’ ability to remain self‑sufficient and improve their infrastructure. Our RecommendationsWe made three recommendations to improve FAA’s oversight policies and procedures for preventing and detecting airport revenue diversion. FAA concurred with our recommendations and provided appropriate actions and completion dates. We consider all recommendations resolved but open pending completion of the planned actions.