Audit Report: DOE-OIG-17-03

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December 29, 2016

Bonneville Power Administration’s Contractor Workforce

The Bonneville Power Administration (Bonneville) markets wholesale electrical power produced primarily from Federal hydro projects in the Pacific Northwest.  In 2015, Bonneville’s workforce consisted of approximately 3,000 Federal employees and approximately 3,100 contract workers.  Bonneville acquires its contractor workforce through service contracts that directly engage the time and effort of a contractor whose primary purpose is to perform a task rather than furnish a product.  In March 2015, the Office of Inspector General received a hotline complaint alleging contract, labor, and management irregularities at Bonneville, including the establishment of prohibited personal services contracts.  

We found that Bonneville had not always effectively and efficiently managed its contractor workforce.  Specifically, based on the results of our judgmental sample of 20 of the 3,117 contract workers, review of documentation related to Bonneville’s procurement of contract workers, and interviews with key personnel, we found that Bonneville had created prohibited personal services contracts by establishing improper employer/employee relationships with supplemental labor workers, one category of its contractor workforce.  Further, a risk that contract workers were inappropriately performing inherently governmental and critical work that should be reserved for Federal employees existed.  We also found weaknesses in Bonneville’s acquisition and administration of services contracts.  

In addition, our conclusions concerning personal services contracts substantiated one of the allegations included in the hotline complaint.  However, we were not able or did not substantiate the other allegations included in the complaint.

The issues we identified occurred, in part, because of problems with the manner in which Bonneville managed and implemented its supplemental labor category of contract workers, lack of a strategic workforce plan, insufficient management and oversight of its contractor workforce, and an inadequate procurement control environment.

Topic: Management & Administration