Audit Report: IG-0690

The Department of Energy (Department), including the National
Requirements Nuclear Security Administration (NNSA), was inconsistent in its
reimbursement for contractor post-retirement health benefit costs.
Further, as a result of these inconsistencies, contractors were
reimbursed for unreasonable costs. Specifically, while NNSA
reimbursed BWXT Y-12, LLC (BWXT Y-12) for the
post-retirement health benefits of corporate transferees, the Oak
Ridge Operations Office (Operations Office) disallowed similar
costs from the Bechtel Jacobs Company, LLC (Bechtel Jacobs)
contract for the East Tennessee Technology Park and denied a
request from UT-Battelle, LLC (UT-Battelle), to provide similar
benefits for the employees of the Oak Ridge National Laboratory.
BWXT Y-12 employees are able to use their corporate years-ofservice
credits when eligibility for post-retirement health benefits
is determined. According to the BWXT Y-12 contract,
"…employees transferring directly from a Bechtel or BWXT
affiliated company will retain the continuous or credited service
date recognized by the affiliated company from which they transfer
for the purpose of vacation eligibility, and savings plan, pension
plan, retiree medical plan vesting, and eligibility for early
retirement."