Federal Reports

This report was submitted to the Comptroller General in accordance with Section 5 of the Government Accountability Office Act of 2008. The report summarizes the activities of the Office of Inspector General (OIG) for the first reporting period of fiscal year 2018. During this reporting period, OIG issued two audit reports, and continued fieldwork on three audits. We also closed 3 investigations and opened 10 new investigations. In addition, we processed 60 hotline complaints, which generally did not involve GAO’s programs and operations. Our heightened focus on key management challenges in such areas as human capital management, and information technology and security continues. Other continuing priorities include contract management operations and strengthening controls for ensuring the quality and reliability of GAO’s DATA Act submissions. We remained active in the GAO and OIG communities by briefing new GAO employees on our audit and investigative missions, and participating on Council of Inspectors General on Integrity and Efficiency committees and working groups. Details of these activities and other OIG accomplishments are provided in the report.

PHILADELPHIA – A former Amtrak employee pleaded guilty to one count of federal program bribery April 19, 2018, in U.S. District Court.According to court documents, Timothy Miller—a former Lead Contract Administrator with Amtrak responsible for procuring equipment and services and managing the account for diesel and locomotive seat-cushion vendors—steered four fleet maintenance contracts worth more than $7.6 million to a single vendor in exchange for approximately $20,000 in bribes, trips, and other items of value.

Connect for Health Colorado (Colorado marketplace), the health insurance exchange established by the State of Colorado under the provisions of the Patient Protection and Affordable Care Act, did not always comply with Federal requirements when expending Federal establishment grant funds allocated for the Shared Eligibility System (SES) costs. (This audit focused on the allocation of SES costs to the Colorado marketplace by the Colorado Department of Health Care Policy and Financing (HCPF), the State Medicaid agency, for the development and implementation of the SES, which is an automated system modified from HCPF’s existing Medicaid eligibility system.) Specifically, the Colorado marketplace allowed (1) SES costs to be allocated to it on the basis of an arbitrary, 50/50 cost allocation ratio, contrary to Federal requirements and to Centers for Medicare & Medicaid Services (CMS) supplemental guidance that the methodology for allocation be based on expected transactions and expected program population and not be arbitrary; and (2) SES costs totaling $2.1 million that were incurred, either entirely or in part, during the initial Cost Allocation Plan (CAP) period to be improperly allocated to it because the marketplace used the cost allocation ratio in effect for the revised CAP period.

To view additional materials related to this report, including a press release, video, and Congressional testimony, please click the link below.

At the time of our audit, Federal Emergency Management Agency (FEMA) estimated that the City of Waterloo, Iowa (City), sustained approximately $1.9 million in damages from severe storms and flooding from September 21 through October 3, 2016. The City did not provide all requested information and explanations necessary to perform our review; therefore, we were unable to assess whether the City’s policies, procedures, and business practices were adequate to account for FEMA Public Assistance grant funds properly. The City’s failure to cooperate with a Federal audit put approximately $1.9 million dollars in potential FEMA grant funding at risk of being deobligated or not funded.