The Department of Energy failed to keep track of millions of dollars worth of government-owned equipment being used by federal contractors, an internal report by the agency has disclosed.

The report by the Inspector General's Office of DOE doesn't accuse contractors of walking off with the equipment -- in fact, contractors' records appear to be better kept than the government's.

But Inspector General J. K. Mansfield called the findings "disquieting" and "extremely troubling." The report noted that because of sloppy record-keeping. "Contractors are afforded obvious opportunities to misuse or keep property belonging not to them but to the government."

In a review of records covering approximately $350 million worth of government property, Mansfield's office found that the DOE didn't have records of $47 million worth of federal property that contractors reported they had on hand.

For another $8 million worth of equipment, DOE records said the property was being held by off-site contractors but the equipment didn't show up in the contractors' records.

"Of the $47 million of contractor-reported property for which DOE did not have any record, we found that the supervising DOE offices were not aware that 54 contractors who reported holding government property valued at $16.3 million even had any government property in their possession," the report noted.

Although the report credited DOE procurement officials with taking steps to improve property management, it noted that the task "was apparently a low-priority item in DOE headquarters" and that inadequate staffing contributed to the problem. "Only one procurement office employe was assigned to monitor government property which may be held under approximately 2,600 contracts," the report observed.

DOE officials who reviewed a draft of the report noted that they already were taking steps -- including some recommended in the report -- to improve the DOE's property management.