Audit Report 

U.S. Department of Energy 

Office of Inspector General 

Office of Audit Services 

Resolution of Significant Finding 

Investigation Recommendations 

DOE/IG- November 2002 

Use of Oversight Funds by the 

State of Nevada and Affected 

Units of Local Government 

DOE/IG-0696 July 2005 



REPORT ON USE OF OVERSIGHT FUNDS BY THE STATE OF 

NEVADA AND AFFECTED UNITS OF LOCAL GOVERNMENT 

TABLE OF 

CONTENTS 

Use of Oversight Funds

Details of Finding.......................................................................................1 

Recommendations and Comments .............................................................5 

Appendices

1. Objective, Scope, and Methodology .....................................................6 

2. Prior Audit Reports ...............................................................................8 

3. Management Comments........................................................................9 
USE OF OVERSIGHT FUNDS 

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Page 1 Details of Finding 

Fund Use Nye, Lincoln, and Clark Counties and the State of Nevada 

(Nevada) used oversight funds for activities unrelated to 

acceptable activities described in the Nuclear Waste Policy 

Act (Act). Oversight funds were expended for specifically 

prohibited activities, such as influencing legislative matters 

and litigation expenses. In some cases, funds were used for 

activities that were not clearly related to oversight 

according to the available documentation. For the period 

under review, we identified $1.2 million in questionable 

costs. (Detailed information on all questioned costs was 

provided under separate cover to the Office of Civilian 

Radioactive Waste Management (OCRWM), the affected 

units of local government, and the State of Nevada.)1

 

OCRWM also had not fully implemented recommendations 

made in prior audit reports. 

Nye County

During Fiscal Years (FY) 2003 and 2004, Nye County 

improperly charged the oversight fund for a number of 

activities unrelated to the Yucca Mountain Project, 

including economic development activities, salaries, 

supplies, and services for costs that should have been 

charged to the Independent Scientific Investigations 

Program (ISIP) grant. The ISIP grant provides funds for 

Nye County to evaluate site characterization, repository 

design, and performance issues affecting human health, 

safety, and the environment. For example, a number of 

individuals worked on activities related to both oversight 

and the ISIP grant; however, the entire cost of salaries, 

supplies, and services was charged to the oversight fund. 

After our previous audit, Nye County determined that the 

salaries for half of these employees had not been correctly 

allocated between oversight and other grant activities. In 

March 2003, Nye County started allocating employee costs 

to other accounts but did not reimburse the oversight fund 

the $224,000 for incorrect allocations made between July 

2002 and February 2003. 

In another example, Nye County paid contractors nearly 

$485,000 of oversight funds for economic development 

activities, grants, and other unrelated activities. Nye 

County also spent about $12,000 for travel costs, including 

 

1

 We questioned the entire amount of those invoices that lacked sufficient detail to allow us to correctly 

separate oversight expenditures from expenditures for unrelated activities.