The Energy Department’s inspector general has warned that the agency has not taken sufficient steps to control the travel costs of its contractors, which account for 85 percent of the $360 million the department spent on travel over the past six years.
Contractors have taken more than 90,000 international trips during that period,according to the audit, which comes as federal agencies have been under orders to cut back on all government travel. Department managers acknowledged to auditors they did not seek to limit contractor travel and generally let contractors decide which trips were justified for their work.
The cost and number of department trips rose each year since 2007 until this year, when travel costs dropped 10 percent.
Inspector General Gregory H. Friedman sent Energy Secretary Steven Chu a management alert on Friday warning him about the auditors’ findings and recommending the agency scrutinize the large travel budget.
“Despite the sizable expenditure of Federal funds, the Department has not made a concerted effort to reduce contractor international travel costs,” Friedman wrote. He added, “we concluded that contractor foreign travel costs are of such a magnitude to warrant inclusion in any Department strategy to reduce contractor costs.”
Last year, President Obama began ordering steep cuts in federal agency travel expenses. At the time, the Department of Energy estimated it could save $15.7 million in travel costs for 2012 by imposing stricter cost-saving rules for federal employee travel.
“At a time when families have had to cut back, have had to make some tough decisions about getting rid of things that they don’t need in order to make the investments that they do, we thought that it was entirely appropriate for our governments and our agencies to try to root out waste, large and small, in a systematic way,” Obama said in November 2011.
But the cost-savings orders were not universally applied to contractors, the audit found. The department has a federal staff of 16,000 employees and 100,000 contractors in various department-funded labs, research centers and offices.
The administration’s attention to federal agency spending was prompted by a public outcry over a 2010 General Services Administration conference outside Las Vegas that cost $823,000. That training conference, which featured a $31,208 catered reception and in-room parties at an opulent resort hotel, embarrassed the Obama administration, violated numerous government conference rules and led to the resignation of GSA Administrator Martha Johnson.
Friedman’s report raises a red flag about the number of trips and people traveling to the same events. This July, for example, the Energy Department paid an estimated bill of $100,000 to $150,000 for 45 federal contract employees to attend a conference on engine combustion in Warsaw. Twenty-seven of the attendees worked at the same Energy Department-funded laboratory. One department contractor lab helped host and chair the symposium.
The conference featured lecturers and presentations on combustion research, which the department says is critical for improving fuel efficiency in vehicles. The six-day Warsaw event also offered a “gala dinner,” Chopin concert and tours of Warsaw sights, the Polish royal castle and a day trip to the city of Krakow.
The Energy Department responded to Friedman’s findings in writing, generally agreeing that it should work to reduce travel costs and reporting that the chief financial officer “will perform an in-depth analysis of contractor foreign travel” for potential savings.
The department stressed it has cut travel costs this year — from $69 million to $62 million. But it added that some of its contractor travel is critical to reducing nuclear threats to national security, including $4.5 million it spent sending contractors to help in the wake of the Fukushima nuclear reactor disaster in Japan.
“The Department is committed to identifying and reducing travel expenses in a manner that balances our responsibility to protect our Nation’s security with our commitment to be good stewards of taxpayer money,” wrote Ingrid Kolb, director of the department’s management office.
The Department of Energy’s travel budget is large compared to some agencies, such as GSA, which estimates it spent $9 million on employee travel in four years. But its figure is dwarfed compared to the departments of Defense, State and others.
In the wake of the GSA scandal, President Obama announced even steeper cuts in agency travel this May, with a goal of reducing 2013 travel expenses by 30 percent from the 2010 figures. The Office of Management and Budget also said it would prohibit spending more than $500,000 on a government conference unless approved by a department secretary.
The Energy Department’s Office of Inspector General flagged high figures in a 2007 audit that scrutinized travel at some department-funded laboratories. In that case, auditors reported that contractors’ domestic and foreign travel in 2006 combined cost $154 million.