DOE Letter Indicates RCLC Not Yet Off The Hook For Up To $300,000 In Grant Monies Received From FY2015-FY2017



The Regional Coalition of LANL Communities has until July 31 to submit all source documentation for fiscal years 2015, 2016 and 2017 to the Department of Energy-Environmental Management to demonstrate that the RCLC properly segregated and allocated DOE funds and to confirm that funds were not spent on lobbying or other unallowable activities.

The deadline was set in a letter from DOE Environmental Management contracting officer Carin P. Boyd to Eric Vasquez, executive director of the RCLC that was obtained by the Los Alamos Reporter. If DOE does not receive documentation to demonstrate RCLC properly segregated, allocated and expended funds, the letter says the DOE will take action to request RCLC repay “the amount of funding not supported by adequate documentation, up to the total amount of DOE funding obligated” during fiscal years the years in question, which totaled $300,000.

Boyd’s letter states that its purpose is to set forth the terms to resolve the “cost allowability” issues raised in the Office of the State Auditor (OSA) special audit for the period of July 1, 2014 through June 30, 2018 and the DOE Office of the Inspector General Inspection Report No. DOE-OIG-19-53. It says DOE awarded a grant of $100,000 a year to the RCLC for a five-year period from July 1, 2015 to June 30, 2020 for a total of $500,000. It notes that RCLC’s budgeted expenditures for those three fiscal years were approximately $189,500.

Boyd says the OSA initiated an investigation of RCLC pursuant to the process set forth in the Audit Rule and that the OSA designated RCLC for a special audit of specific transactions for the period of July 1, 2014 through June 30, 2018.

“As part of its audit, OSA made specific findings regarding the actions of RCLC’s fiscal agent, Los Alamos County, noting that ‘the County pooled the RCLC funds in an account with Los Alamos County funds and certain funds were miscoded and paid by the wrong entity. The RCLC Board and Los Alamos County do not appear to have maintained full and adequate records of all expenditures’,” the letter states. “In addition to comingling DOE funds with funds from other sources, the special audit also found RCLC to be in violation of 18 USCS § 1913, Lobbying With Appropriated Moneys, and the grant terms and conditions.”

Although the RCLC is not prohibited from lobbying activities, Boyd states that it is expressly prohibited from using federal funds to engage in lobbying activities under the terms of the grant.

“As a result of the OSA and DOE IG findings, the DOE requested RCLC to provide documentation to show it properly segregated DOE-funding from non-DOE funding, that funds were properly allocated, and that funds were not spent on unallowable activities,” the letter states. “Upon receipt and review of the documentation, the DOE determined that the documentation was insufficient to demonstrate proper segregation and allocation, or that the expenditure of funds was proper.”

It notes that while DOE “strongly considered” the allowability of some portion of the obligated funding, there was no way to determine if or how much federal funding was used in violation of the anti-lobbying provisions of the grant as RCLC did not segregate DOE funds from non-DOE funds.

Questioned by RCLC board members in January, Vasquez said the DOE over the previous year conducted an internal investigation into the way they handled the grant and how the RCLC was expending the grant. He said that when the IG report came out in late September 2019, there was a recommendation that the RCLC account for $300,000 of grant funding.

“It was requested that we do so by a set date. We provided the documentation to the best of our ability at that time. Since then we have been in discussions with the grant officers about whether everything is kosher,” Vasquez said at that time. He said that moving on from there, after that is settled, the RCLC is “anticipating and hoping and talking with individuals about restarting the grant”.

Asked who he was communicating with concerning the grant, Vasquez said had had conversations with the office that oversees the grant and “individuals higher up when we’ve visited with DOE in the past” as well as members of the congressional delegation.

In February the RCLC executive voted to send letters to the congressional delegation asking for assistance in ensuring that the RCLC would continue to receive DOE support for “funding education and community outreach efforts”.  Although it noted the deficiencies uncovered spring of 2018 in the RCLC’s internal controls and spending policies and that “deliberate steps” were taken to ensure tighter controls around its spending and reimbursement, there was no mention in the letter of the possible requirement that up to $300,000 be reimbursed to DOE.

That issue was also not raised at the April 24 RCLC meeting when board members asked for meetings to be set up with the congressional delegation to again address the DOE grant. At that meeting, RCLC treasurer Los Alamos County Councilor David Izraelevitz raised the possibility that the RCLC may not be sustainable without the DOE grant.

The Los Alamos Reporter also obtained a copy of a letter received by Sen. Martin Heinrich in response to correspondence he had sent to DOE-EM on behalf of RCLC chair Santa Fe County Commissioner Henry Roybal. That letter, signed by William I. White, senior advisor for DOE-EM to the Under Secretary of Science, says that EM agrees the work of the RCLC does is important and should be funded “consistent with support provided to other communities neighboring DOE facilities”.

“As you noted, full funding for RCLC is included in the Department’s budget requests for fiscal years 2020 and 2021. Prior to providing additional funding, we are working to confirm that the RCLC internal controls and spending policies needed to address the DOE Inspector General (IG) investigation findings have been fully implemented. We will continue to work with the RCLC in resolution of the DOE IG recommendations, and the restoration of future funding as appropriate,” the letter to Senator Heinrich stated.

The grant status and the DOE correspondence are expected to be discussed at the May 15 RCLC board meeting. The IG report may be read at the link below.