Federal Reports

We inspected whether the Bureau of Land Management’s (BLM’s) implementation of its 2012 Idle Well Review and Data Entry policy reduced its number of idle wells in accordance with policy. Specifically, we assessed whether BLM: (1). maintained an accurate inventory of idle wells; (2) developed a clear strategy for reviewing idle wells; (3) ensured required idle well reviews, approvals, and tests were performed; and (4) maintained reliable idle well data.Based on data received from BLM, we determined the Bureau did not reduce the number of idle wells from 2013 through August 2016. The number of reported idle wells in BLM’s inventory at the end of FY2013 was 4,546 and, as of August 2016, it was 4,618. These numbers, however, are hardly reliable because of BLM’s deficient implementation of IM 2012-181.We found various program management issues that have contributed to BLM’s inability to reduce the number of its idle wells. Specifically, BLM has not applied the correct definition of an idle well, which makes it unable to maintain an accurate inventory of its idle wells. BLM also does not have a clear strategy for conducting idle well reviews, and has an ineffective process for monitoring the required well reviews and approvals. Further, BLM has not established all the guidance needed to manage its idle wells. Finally, BLM monitors its idle wells using a database that is unreliable due to inaccurate well status and absence of necessary data fields.We made 11 recommendations to help BLM better determine, manage, and reduce its idle well inventory, thus reducing the potential liability.

We conducted a review of the Bureau of Reclamation’s (USBR’s) administration of transfers and conveyances of water. Our objective was to determine whether the transfers and conveyances facilitated by the USBR were done in accordance with applicable laws, regulations, and policies.We could not make a determination because a legal opinion on application of the Warren Act of 1911, which governs conveyance of non-project water through Federal facilities, is needed. In a review of water data for California’s Central Valley Project (CVP) for 2012 to 2015, we found that contractors charged other contractors more than they paid the USBR for water conveyance. Specifically, we found that contractors potentially generated revenue between $192 million and $1 billion on water conveyed under the Warren Act.We found no formal legal opinion on whether the USBR is entitled to revenue generated through water conveyance under the Warren Act, but the language of a subsequent law says that “all moneys or profits . . . derived from the sale or rental of surplus water under the Warren Act . . . shall be credited to the project.” Thus the USBR may have the opportunity to recoup millions of dollars that could be applied toward repayment of the Federal investment in water projects such as the CVP.We recommend that the USBR obtain a legal opinion from the Department’s Office of the Solicitor to determine whether (1) contractors are allowed to collect revenue in excess of costs and make a profit on the conveyance of non-project water through Federal facilities, and (2) any moneys or profits derived from such conveyances must be credited to the project or division of the project to which the construction cost has been charged or to the U.S. Treasury.

OIG investigated allegations of theft from the Seminole Nation of Oklahoma (SNO) through counterfeit checks associated with an account that may have contained Federal funds.Our investigation determined that multiple individuals from the Wichita, KS area cashed counterfeit checks totaling more than $20,000. The checks were made to look like they had been issued by legitimate Wichita businesses, however, the routing and bank account information printed on the checks resulted in the funds being withdrawn from an SNO bank account.The U.S. Attorney’s Office, Eastern District of Oklahoma, declined prosecution. We forwarded our report of investigation to the Wichita Police Department, Financial Crimes Section and closed our investigation.

The OIG investigated whether National Park Service (NPS) management appropriately handled sexual misconduct complaints at a National Recreation Area (NRA) in Texas. The initial complainant reported that an employee at the NRA exposed himself to her and sexually assaulted her on multiple occasions between 2012 and 2014. The complainant alleged she reported the incidents to NPS management when they occurred, but they failed to take any action.Our investigation did not find any evidence that the complainant reported the incidents to her supervisor as she reported in her complaint. We determined that once management learned of the allegations in 2016, they took swift action to address the issues and handled the complaint appropriately.During our investigation, another employee reported that she had also been a victim of sexual misconduct by the same NRA employee. She acknowledged that she did not report the incident to management when it occurred. Again, we determined that management took decisive and immediate action as soon as they learned of this additional allegation.We also found that NPS management had received three additional allegations of sexual misconduct at the NRA in previous years that were unrelated to this employee. Our review concluded that those previous incidents were reported and appropriately handled.A criminal investigation into the actions of the NRA employee is ongoing by the NPS.

During the audit, our independent public accounting firm, CliftonLarsonAllen LLP, identified certain matters related to PBGC’s internal controls and operations that while significant are not of sufficient magnitude to impact the financial statement opinion and were not included in the report on internal controls dated November 17, 2017 (AUD-2018-6/FA-17-119-3). This management letter summarizes CliftonLarsonAllen's findings and recommendations regarding these matters and includes the status of prior years' management letter recommendations. PBGC management agreed with the new recommendations and provided planned corrective actions and estimated completion dates.

For the Medicare Advantage (MA) program, CMS contracts with private insurance companies, known as MA organizations (MAOs), to provide Medicare coverage for 18.6 million beneficiaries. In fiscal year 2016, MA expenses reached $200 billion. In 2012, CMS began collecting detailed information from MAOs regarding each service provided to MA beneficiaries. This information is known as MA encounter data. These data must be accurate for CMS to review the medical care that beneficiaries are receiving and use the data to increase payments to MAOs for beneficiaries in poorer health. Ensuring the completeness, validity, and timeliness of the MA encounter data is also critical to safeguard program integrity and to ensure that MA beneficiaries receive needed medical care.