GAO

United States General Accounting Office

Report to Congressional Requesters

July 2000 CHEMICAL SAFETY

BOARD

Improved Policies and

Additional Oversight

Are Needed

GAO/RCED-00-192

Page 1 GAO/RCED-00-192 Chemical Safety Board

Contents

Letter 3

Appendixes Appendix I: Comments From the Chemical Safety and Hazard

Investigation Board 34

Tables Table 1: The Board’s Current and Projected Staffing Levels, by

Functional Office, as of June 15, 2000 10

Abbreviations

CEO Chief Executive Officer

DOE Department of Energy

DOT Department of Transportation

EPA Environmental Protection Agency

GSA General Services Administration

NRC Nuclear Regulatory Commission

NTSB National Transportation Safety Board

OPM Office of Personnel Management

OSHA Occupational Safety and Health Administration
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United States General Accounting Office

Washington, D.C. 20548

Resources, Community, and

Economic Development Division

B-285501 Letr

July 11, 2000

The Honorable Christopher S. Bond

Chairman, Subcommittee on VA, HUD,

and Independent Agencies

Committee on Appropriations

United States Senate

The Honorable Frank R. Lautenberg

United States Senate

The Chemical Safety and Hazard Investigation Board (the Board) is an

independent agency currently in its third year of operation. The Board’s

mission is to enhance the health and safety of the public, workers, and the

environment by investigating the causes of accidental chemical releases

and using these findings to promote preventive actions by the private and

public sectors. The authorizing statute provides for five Board members,

including a chairperson, all appointed by the President. In 1999, the

Chairman and the other members of the Board disagreed over their

respective roles and responsibilities for managing the agency. The existing

Chairman resigned his position as chair in January 2000 but remained a

Board member. As of June 30, 2000, there were four Board members and

the position of chairperson was vacant.

Concerned about the Board’s management problems, you asked us to

review the effectiveness of the Board in carrying out its mission. As agreed

with your offices, our report addresses (1) the current status of the Board’s

organization and operations; (2) the Board’s efforts to update and develop

plans, policies, and procedures for accomplishing the Board’s mission,

including those aimed at ensuring the objectivity of its investigative

activities; and (3) whether the Board would benefit from the independent

oversight of an inspector general. In conjunction with the Subcommittee’s

appropriation hearings, we provided an interim statement for the record in

April 2000, which presented the results of our work as of that date.1

1

Chemical Safety Board: Realigned Management Faces Serious Challenges (GAO/T-RCED147, Apr. 12, 2000).
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Results in Brief Since January 2000, the Board has been operating under a new

organizational structure based on shared decision-making, which was not

in effect during most of its first 2 years of operation. Continuing

disagreements between three of the Board members and the former

Chairman raise questions concerning the Board’s future productivity and

effectiveness. In terms of operations, the Board has made only limited

progress in addressing the investigative backlog that developed after its

first year, and it has not initiated a new investigation since March 1999.

However, the realigned Board established eight priorities for the balance of

fiscal year 2000 that support its primary investigative mission, including the

completion of three investigative reports.

The Board has made some progress in developing needed plans, policies,

and procedures to guide its activities. For example, the Board issued

formal written procedures for awarding and managing contracts in

December 1999. However, these policies were not in place when most of

the Board’s larger contracts ($100,000 or more) were executed, and Board

officials have identified a number of contracting activities that appear to

have provided limited benefit to the agency. Furthermore, the Board is

revising its interim criteria for selecting incidents to investigate as well as

its investigative protocol and is developing a strategic plan to both meet

statutory requirements and update its business plan. The Board plans to

have these plans and guides completed by September 2000. The Board’s

interim investigative protocol does not include needed policies and

procedures that would help ensure objectivity and balance in its

investigative work, such as those covering conflicts of interest. We are

recommending that the Board adopt clear policies and procedures on

potential conflicts of interest and consider other policies and procedures

used by some other investigative agencies that also promote investigative

impartiality and thoroughness.

The operational problems that the Board has experienced in its 2-1/2 years

of existence—including governance and management conflicts,

contracting expenditures of limited value, and the lack of basic operating

policies and procedures—suggest that ongoing institutional oversight

would be beneficial. While the Board could develop an in-house audit

function or contract out for evaluations, we believe an option that offers

the best potential for effective oversight would be for the Board to obtain

the services of an existing office of inspector general. We are therefore

recommending that the Board develop an agreement with an existing office
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of inspector general that would provide for ongoing institutional oversight

of the Board.

Background Chemical incidents—accidental releases of toxic and hazardous

chemicals—occur frequently and often have serious consequences.

However, according to Board officials, reliable national statistics on the

number of accidents, injuries, and deaths do not exist.2 The Board is an

independent agency created in 1990 under amendments to the Clean Air

Act.3 The act directs the Board to (1) investigate and report on the

circumstances and the probable causes of chemical incidents resulting in a

fatality, serious injury, or substantial property damages; (2) recommend

measures to reduce the likelihood or the consequences of such accidents

and propose corrective measures; and (3) establish regulations for

reporting accidental releases.

The Board has no enforcement authority and a very limited regulatory role.

According to a relevant legislative committee report, the Board is modeled

after the National Transportation Safety Board (NTSB), which retained the

lead role in investigating transportation-related chemical incidents. The

Board is to consist of five members, including a chairperson, appointed by

the President and confirmed by the Senate. The chairperson is the Chief

Executive Officer (CEO) of the Board. The staff includes a chief operating

officer, investigators, attorneys, and program analysts. The President’s

budget requested $8 million for the Board in fiscal year 2001, the same

funding level provided in fiscal year 2000.

To accomplish its primary mission, the Board has conducted both full-scale

investigations of chemical accidents as well as limited investigations,

called reviews. In April 1999, we reported that the Board had a backlog of

incomplete investigations and had not developed a plan to address the

backlog.4 We also reported that it had not put into place formal, written

2

In 1999, the Board compiled statistics from five federal databases; these statistics indicated

that about 60,000 chemical incidents occur each year, resulting in about 2,300 injuries and

more than 100 deaths. However, the Board recognizes that these statistics have serious

limitations and is developing a plan to determine a more reliable estimate.

3

The Board did not become operational until 1998 because of funding constraints.

4

Chemical Safety Board: Status of Implementation Efforts (GAO/T-RCED-99-167, Apr. 29,

1999).
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procedures for its staff to follow in awarding and managing contracts.

Finally, we determined that significant portions of the Board’s actual and

planned resources were dedicated to activities, such as external relations,

that did not directly support the conduct of its investigations.

Status of the Board’s

Organization and

Operations

In December 1999, after almost 2 years of operations, the Board changed its

management responsibilities and functional alignment to address, among

other things, conflicts that had arisen over the roles and responsibilities of

the Board members. Specifically, in December 1999 and January 2000, the

Board developed interim solutions to important organizational issues

regarding the roles and the management responsibilities of the Board

members. The Board has also increased the proportion of staffing

resources to be allocated to its primary mission of conducting

investigations and established eight priority actions for the balance of fiscal

year 2000, including the hiring of investigations and safety staff. In terms of

operations, since March 1999, the Board has made limited progress in

addressing the investigative backlog that had developed after its first year,

and it has not initiated a new investigation since that time. However, the

Board plans to complete three investigative reports and initiate one

investigation in fiscal year 2000. The more limited review program was

terminated because of problems with both its design and implementation.

The Board plans to initiate a new program addressing safety problems that

are beyond the scope of any one particular incident under review and has

initiated action to complete an agreement with NTSB, as required by the

Clean Air Act, addressing their respective roles and responsibilities in

investigating transportation incidents involving chemicals. Finally,

contracting activities have primarily supported information technology and

investigations, but, according to Board officials, the agency has received

limited benefits for some of its contracts.
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Conflicts Arose Over the

Roles and the

Responsibilities of Board

Members

In 1999, the Chairman and the other members of the Board disagreed over

their respective roles and responsibilities for managing the agency. In

essence, the Chairman asserted that he had sole control over many

significant agency decisions, while the other Board members believed that

making these decisions was the collective responsibility of the Board.

Consequently, the Board members did not necessarily support the actions

taken by the Chairman. For example, they were concerned about the initial

fiscal year 2001 budget request the Chairman had sent to the appropriations

committees in October 1999; this request would have doubled the Board’s

funding to $16 million.5 In addition, according to a Board directive, both

the Chairman and the Board’s Chief Operating Officer did not comply with

requests from the other Board members for contracting documents that

they wanted to review in order to identify the goods and services that had

been provided under the contracts.6

The Board members asked the agency’s General Counsel to provide a legal

opinion on the roles and the responsibilities of Board members. In an

August 1999 memorandum, the agency’s General Counsel concluded that,

for a number of important agency functions, there should be at least some

amount of shared responsibility between the Chairman and the other Board

members. For example, the memorandum concluded that while the

Chairman and his staff were responsible for preparing the agency’s budget

request, it must be approved by the full Board before being transmitted to

the Congress and the Office of Management and Budget. Similarly, the

memorandum stated that while the use and the distribution of the agency’s

funds for contracting purposes falls within the scope of the Chairman’s

administrative functions, the exercise of this authority is subject to the

oversight of the other Board members.

5

On November 16, 1999, the Board members sent a letter to the appropriations committees

to state their reservations about the budget request and ask that the Chairman’s request be

disregarded.

6

The former Chairman told us that he did not agree with the Board members’ assertion that

they were denied access to contracting files.
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In October 1999, the Board members accepted the General Counsel’s

opinion, but the Chairman requested further legal clarification before

implementing the opinion. The Chairman interpreted the Board’s

authorizing statute as giving him authority, as CEO, over a number of

agency functions, including all budget and contracting issues, subject to

review only by the President and the Congress. In November 1999, the

Board members requested an opinion from the Department of Justice’s

Office of Legal Counsel on the legal accuracy of the General Counsel’s

memorandum and agreed to be bound by the opinion.7 In addition, on

December 1, 1999, the Chairman also requested that the Office of Legal

Counsel review the Board’s authorizing statute to determine the precise

roles and responsibilities of the chairperson and the Board, and he agreed

to be bound by the Office’s conclusion. Also on December 1, 1999, the

Chairman and the Board members developed an agreement specifying the

interim measures to be taken until the Department of Justice provided its

legal opinion.8 This agreement expanded the roles and the responsibilities

of the Board members. On June 26, 2000, the Department of Justice’s

Office of Legal Counsel concluded that the day-to-day administration of

agency matters is the responsibility of the chairman but is subject to

oversight by the Board as a whole, and that the Board’s decisions would

generally be controlling in disputes over the allocation of authority in

specific instances.

The Board’s disagreement about its governance became a matter of public

record, reported in newspapers and periodicals. In January 2000, the

Chairman submitted his resignation as Chairman and CEO, effective

January 12, 2000, but retained his position as a Board member. The

President has not appointed a new chairperson, and the Board is currently

operating without a chairperson and CEO.

On January 14, 2000, the Board members established and implemented

interim operating procedures that delineate their roles and responsibilities

whenever the position of chairperson is vacant. The procedures delegate

7

The former Chairman told us that prior to the November 1999 letter, he sought assistance

from White House officials to help resolve the matter. The officials referred him to Justice’s

Office of Legal Counsel.

8

On December 1, 1999, Senator Lautenberg sent a letter to the Board stating that his

understanding of the statute creating the Board was that it intended the Board as a whole to

direct and approve the executive and administrative functions performed by the

chairperson.
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specific responsibilities, such as personnel matters and allocating

resources, to individual Board members. In addition, the procedures

identify the specific responsibilities, including developing budgets and

awarding contracts exceeding $10,000, that require a majority vote of the

Board members for approval.

The procedures are in place, and the Board is operating and making

decisions by majority vote. However, disagreements between three of the

Board members and the former Chairman about the management of the

Board continue to be aired in publications and raised with Members of

Congress. A Board member acknowledged that the productivity and

effectiveness of the Board is impaired by this on-going conflict to the

extent that it requires the expenditure of time and effort to resolving the

conflict rather than to managing the agency. In May 2000, the three Board

members petitioned the President to remove the former Chairman from his

position as a Board member, alleging malfeasance, inefficiency, and neglect

of duty.

Realigned Board Has

Established Priorities

After delineating their roles and responsibilities, in March 2000 the Board

members established eight priority actions for the balance of fiscal year

2000 to better support the Board’s primary investigative mission. The eight

priorities are hiring investigations and safety staff, developing a staff

training program, completing three investigative reports, revising the

investigation protocol, revising the incident selection criteria, and initiating

new investigations. In addition, during this fiscal year, the Board is

committed to developing a strategic plan and personnel policies and

procedures.

Current Functional

Alignment Emphasizes

Investigations, but Many

Positions Are Vacant

During fiscal year 1999 and the early part of fiscal year 2000, the Board

made organizational changes to better carry out its mission. Among other

things, the Board increased the proportion of staffing resources to be

allocated to its investigative function. However, because of difficulties in

recruiting qualified staff, many vacancies exist in the Office of

Investigations and Safety Programs. The Board also shifted several key

personnel. The former Chief Operating Officer has been assigned to an

interim position of special assistant to a Board member, and the General

Counsel has assumed the position of Chief Operating Officer in addition to

his legal responsibilities. Also, on February 2, 2000, the Board named a

staff member to the position of Director of the Office of Investigations and

Safety Programs.
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Increased Resources Allocated

for Investigations and Safety

Currently, the Board has 27 staff, including the 4 Board members. The

Board expects to grow to a staff of 40 by the end of fiscal year 2000, with

almost all of the growth in the areas of investigations and safety. Table 1

identifies the Board’s offices and staffing allocations, both current and

planned.

Table 1: The Board’s Current and Projected Staffing Levels, by Functional Office, as

of June 15, 2000

a

Currently, the Board’s office includes the four Board members, one special assistant, and

one program analyst. Projected staffing includes the fifth Board member, as provided by the

Board’s authorizing statute.

b

The head of the Office of General Counsel also serves as the Chief Operating Officer. This

individual is included only in the staffing allocated to the Office of General Counsel.

c

The Office of Administration includes two positions that were formerly in the Office of

Information Technology.

The projected staffing differs markedly from the staffing associated with

the Board’s budget request for fiscal year 2000. Specifically, in February

1999, the Board expected to grow to a staff level of 60 by the end of fiscal

year 2000, compared with current plans to grow to 40 staff.9 In addition,

last year a greater proportion of staff was planned for organizational units

that did not directly support the Board’s investigative mission. For

example, last year 33 percent of the Board’s projected staffing resources at

the end of fiscal year 2000 was allocated to investigations and safety

Office Current staffing

Projected staffing

by the end of fiscal

year 2000

Board members and staff 6 7a

Chief Operating Officer 1b 2

Investigations and Safety Programs 8 18

General Counsel 3b 3

External Relations 2 2

Administrationc 7 8

Total 27 40

9

The Board’s budget request for fiscal year 2000 was $12.5 million. However, the Congress

provided $8 million. This amount does not support the planned staffing growth to 60 staff.
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programs, compared with the current projections of 45 percent. Currently,

the Board plans to allocate two staff to the Office of External Relations

compared with the planned allocation of nine staff a year ago.

Vacancies Exist in the

Investigations Area

As shown in table 1, as of June 15, 2000, 10 of the18 positions planned for

the Office of Investigations and Safety Programs were vacant, and 6 of

these were investigative positions. However, according to a Board official,

two investigators accepted job offers during the week of June 19, 2000. As

a result, two of the six investigative vacancies are expected to be filled in

July and August 2000. The other vacancies are for one program analyst,

one technical writer, one library/researcher, and one administrative

assistant. Board officials told us that the vacancies exist because of

recruitment difficulties and the loss of two investigators. According to the

Board, potential recruits with the requisite chemical safety skills—

primarily from the oil and chemical process industries—are highly paid and

typically located in areas far from Washington, D.C. Board officials said

that it has been difficult to get prospective staff to relocate. In addition, the

Board has found that it takes 6 months or longer to recruit and hire staff.

This time frame for hiring staff is longer than the Board anticipated.

Moreover, according to Board officials, one investigator resigned and

another was terminated. In addition, another investigator has announced

his intention to resign.10

The newly constituted Board is focusing on personnel management issues

in fiscal year 2000. As reflected in its identified priorities for the fiscal year,

the Board will concentrate on hiring and training qualified professional

staff and retaining and retraining current staff. First, the Board obtained

approval from the Office of Personnel Management (OPM) in March 2000

to reinstate through December 2000 special hiring authority (termed

Schedule A) that the Board had been granted previously. According to

Board officials, this special hiring authority, which it had until December

31, 1999, is typically granted to new federal agencies for a limited time

period and expedites the hiring process.

In its letter to OPM requesting special hiring authority, the Board stated

that it had an urgent need to expedite the hiring of investigative and safety

personnel to complete its work backlog. The Board’s letter stated that with

some of its investigations more than 2 years old, it is under pressure from

10The position that will become available when this investigator resigns is not included as

one of the six vacancies discussed above.
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the Congress, stakeholders, and the public to complete the eight

outstanding investigations as soon as possible. The letter acknowledged

that the Board could face serious consequences, including the possible loss

of funding, if it does not hire the additional staff needed to make

substantive progress on its investigative backlog.

In addition to using the special hiring authority, the Board has developed

and is implementing a new hiring plan that allows it to offer several

financial incentives to better recruit qualified staff, such as paying travel

and relocation expenses of new professional staff and providing a

recruitment bonus plan. Board officials said progress in filling key

technical positions is being made as a result of the new hiring plan. In

addition to the two investigators who accepted job offers in June, the

Board has recently hired a chemical safety recommendation specialist and

a special assistant with an extensive background in chemistry. As of June

15, 2000, the Board was continuing to actively recruit investigators. A

Board member had said previously that the Board’s ability to complete its

priority tasks would be jeopardized if new investigators were not on board

by June 30, 2000.

In addition, the realigned Board has determined that it must develop

personnel policies and procedures for its staff. The Board plans to develop

needed policies on leave, office hours, and employee conduct and

discipline, among others. The Board also plans to revise and implement a

performance appraisal program. In most cases, according to Board

officials, employees have not received performance appraisals, although

the Board has employed most of them for more than 1 year.
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Progress Has Been Slow in

Initiating and Completing

Investigations

The Board investigates accidental chemical releases resulting in a fatality,

serious injury, or substantial property damage. These investigations often

involve extensive site visits, evidence collection, and analytical work. The

Board started five full-scale investigations in 1998 and six in 1999, although

none have been initiated since March 1999. Of the 11 investigations, 3

started in 1998 have been completed. However, only one report has been

completed since March 1999. Nevertheless, a number of its

recommendations from the three completed reports have been

implemented.11

Draft reports are in process for three investigations. Completion of these

reports by September 30, 2000, represents three of the Board’s eight

priorities for fiscal year 2000. The Board has not decided what it will do

about the other five outstanding investigations. Alternatives include

developing investigative reports, issuing summary reports, or concluding

the investigations without reports. In addition to the personnel issues

discussed above, the Board believes one of the causes of the investigations

backlog was an overreliance on contractors to investigate accidents.

According to the Board, this overreliance on contractors resulted in some

poor investigations and draft reports because of insufficient Board staff or

inadequate procedures for monitoring the contractors’ personnel to ensure

their activities met the Board’s investigative needs. In terms of future

investigations, the Board plans to initiate one investigation during fiscal

year 2000 and four or five investigations each year beginning in fiscal year

2001.

Review Program Has Been

Terminated

The more limited review program was developed to provide information to

prevent future incidents by using an approach that was less resourceintensive than full investigations. The protocol for these reviews provided

for a limited, office-based review of investigative reports prepared by the

organizations that responded to the incident. The Board initiated a total of

23 reviews in 1998 and 1999. However, Board officials told us that they

terminated the program in 1999 because it conflicted with the Board’s

independence by having the Board rely on the work of other agencies.

11To date, the Board has made 28 recommendations aimed primarily at encouraging industry

and government agencies to upgrade safety procedures, training, and the communication of

hazards. Fourteen of the recommendations have been agreed to and/or implemented; 10 are

no longer applicable because they are directed to a company that did not resume

manufacturing operations following the accident; and 4 remain open.
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According to these officials, the Board cannot adopt the work of other

organizations whose missions and mandates differ from its own because it

cannot control or ensure the quality of the products prepared by others.

Other problems identified with the program included the longer-thananticipated time spent in collecting the information and drafting the reports

as well as the possibility of duplicating the work done by other agencies. In

July 1999, the Board decided to add the factual data about these reviews to

an existing incident database it maintains.

Safety Studies Are Planned Although not among the Board’s eight identified priorities for fiscal year

2000, the Board plans to establish a program—modeled after an NTSB

program—to develop safety studies to better understand the nature and

causes of specific safety problems that are beyond the scope of any one

incident under investigation. The Board plans to initiate one safety study

during fiscal year 2000. As of June 2000, the Board had not selected the

study to be initiated, but officials said it would likely evolve from one of the

three investigations to be completed in fiscal year 2000. Board officials

said that the safety studies selected would likely stem from the research

needs identified in recommendations the Board develops in its

investigative reports. They indicated they would receive, at a minimum,

iput from other parties to ensure the studies are useful.
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Required Agreement With

NTSB Has Not Been

Completed

Other federal agencies, including the Occupational Safety and Health

Administration (OSHA), NTSB, and the Environmental Protection Agency

(EPA), have responsibilities for responding to and/or investigating

chemical incidents. The Board is required by its authorizing statute to

coordinate its activities with these agencies. Furthermore, the Clean Air

Act requires the Board to enter into an agreement, called a memorandum of

understanding, with NTSB to ensure the coordination of functions and to

limit the duplication of activities.12 The agreement must designate NTSB as

the lead agency for investigating accidents that are transportation-related.

The Clean Air Act also requires the Board to enter into an agreement with

OSHA to limit the duplication of investigation activities. The Board

developed an agreement with OSHA in 1998 that establishes policy and

general procedures for cooperation and coordination and for minimizing

duplication so that each agency can carry out its specific statutory

requirements in an efficient and effective manner.13

However, the mandated agreement between NTSB and the Board has not

been completed. Board officials told us the agreement was not made final

last year, in part because NTSB did not follow through with its stated plan

to return a final version of the draft agreement to the Board by the end of

August 1999. After we discussed this issue with Board officials, the Board

sent a letter to the Chairman of NTSB on June 6, 2000, discussing, among

other things, the need to complete the draft agreement.

1242 U.S.C. 7412(r)(6).

13Although the Clean Air Act does not mandate the Board to enter into a similar agreement

with EPA, the Board did so in 1999.
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Board officials told us that the Board would generally not be involved in

transportation-related accidents and believe it is very unlikely that the

Board and NTSB would investigate the same incident. The officials said

that because NTSB has primary jurisdiction for transportation incidents,

and because of the Board’s limited resources, the Board is appropriately

directing its attention to accidents at fixed facilities. However, they

indicated that the Board could not rule out being involved in an

extraordinary transportation incident. We note that while Board officials

have said that it is unlikely they would investigate a transportation

accident, one of the incidents that the Board chose to analyze under its

review program was a pipeline accident, a transportation area for which

NTSB has primary investigative responsibility.14

Some Contracting Activities

Have Provided Limited

Benefits

Since it began operations in January 1998, the Board has obligated about

$4.7 million to 13 contracts, purchase orders, and agreements of $100,000

or more.15 A significant portion of these contracting obligations—$2.4

million—have supported information technology, such as the creation of

data systems and databases, compared with $1.4 million for investigative

support. These activities were contracted before the management

realignments in December 1999 and January 2000 and the establishment of

contracting policies and procedures in December 1999. Prior to the

management realignments, contracting actions were the responsibility of

the former Chairman and the former Chief Operating Officer, and the other

Board members did not have a role in reviewing or approving contracts. In

addition, these contracts were made prior to being directed—in the House

conference committee report accompanying the Board’s fiscal year 2000

appropriations bill—to spend the preponderance of its resources, including

contract resources, on investigations and safety instead of on information

technology or external affairs.

14Board officials said that they determined that NTSB was not going to investigate this

accident before they undertook the review.

15Information as of March 2000. Contracts for office space or telephone charges are not

included.
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According to Board officials, the agency has received limited benefits for

some of its contracting activities. For example, the Board is not currently

using—and may never use—the $636,000 Incident and Investigation

Information System developed by Oak Ridge National Laboratory in 1999

that would catalog information from the Board’s accident investigations.16

The officials said that the investigation and safety program staff who would

use this system had limited input into its design. According to Board

officials, the system is overly complex and an off-the-shelf database may

better meet the Board’s needs. While the Board plans to formally evaluate

the system to determine its value to the Board, this evaluation is on

indefinite hold because of higher priority work for fiscal year 2000.

In addition, the realigned Board has been reviewing its information

technology projects and has determined, among other things, that it has

overcapacity in information technology. As a result, in June 2000, the

Board decided to reduce its information technology budget for fiscal year

2000 by $1.3 million—more than 15 percent of its total annual

appropriation—either by not funding or by reducing funding to various

contracts.

Similarly, Board officials also acknowledged that other contracting

activities may be of limited value to the Board, such as the following:

• Baseline of chemical accidents. The Board spent more than $450,000

under two contracts to develop a 10-year baseline of chemical accidents.

However, the Board believes these statistics have serious data quality

limitations and is developing a plan to determine a more reliable

estimate of the universe of chemical accidents.

• Pressure relief systems. The Board paid about $326,000 for

information on pressure relief systems that are used in chemical

processing operations. Board officials said that the information from

the study appears to be of limited use to them. A Board member stated

that while the agreement was designed to assist the Board’s

investigators and safety staff in their work, the work proposal was not

reviewed by the Board members or the safety and investigations staff

for design, purpose, and outcomes. As a result, the product is of lesser

value than could have been attained if input from the users and the

16This information system was developed by the Department of Energy’s Oak Ridge National

Laboratory under an interagency acquisition agreement between the Board and the

Department.
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Board members had been obtained. The Board member said that the

other pressing priorities have precluded the Board from completing its

review of the information provided under the agreement. He said,

however, that the agency needs to develop procedures for the internal

technical review of goods and services provided to the Board under

contracts and agreements.

• Use of contractors to investigate incidents. As discussed earlier,

Board officials also believe that the agency relied too heavily on

contractors to investigate accidents, resulting in some poor

investigations and draft reports. They attribute this primarily to

insufficient Board staff or inadequate procedures to monitor the

contractors’ personnel to ensure their activities met the Board’s

investigative needs.

In addition, given its limited productivity and workload changes, we

questioned the Board about its use of funds to develop an informational

video demonstrating the Board’s purpose and activities. As of March 2000,

the Board had paid $80,000 of the $160,000 obligated in 1998 for the video.

One Board member told us that he did not believe it was appropriate to

develop a video at this time. In response to our questions about the views

of the other Board members on the need for a video, he said he would raise

this issue at the next meeting of the Board. In April 2000, the Board

decided it was not appropriate to develop a video. According to Board

officials, the contractor is entitled to recover incurred costs and profit on

the work already completed because the contract is being terminated for

the convenience of the government. The Board is currently determining

what this amount should be.

In January 2000, to ensure that future contracting activities contribute to its

overall goals, the Board approved interim operating procedures that

require contracts exceeding $10,000 be approved by a majority vote of the

Board members. In addition, one Board member is assigned the

responsibility for supervising the use and expenditure of funds, including

authorizing contracts between $2,500 and $10,000. A Board member said

that this new policy will provide greater transparency of proposed

contracting actions and avoid contracting for work of limited utility to the

Board. In addition, the Board is changing the way it uses contracting

support for its investigations. Rather than retaining contractors to perform

the investigations, the Board is contracting for specific expertise or tests

needed for investigations that are led by Board investigators.
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Status of the Board’s

Efforts to Update and

Develop Plans,

Policies, and

Procedures

In April 1999, we reported on two concerns about the Board’s actions.17

One concern related to the backlog of investigations and the fact that the

Board had not updated its initial business plan to reflect the backlog and

examine how to address this problem by, for example, reallocating existing

and planned resources. The second concern stemmed from the problems

with contracting that developed shortly after the Board began operations.

We indicated the need for formal procedures for its staff to follow in

awarding and managing contracts. As discussed earlier, the House

conference committee report accompanying the Board’s fiscal year 2000

appropriations act directed the Board to spend the preponderance of its

resources, including contract resources, on investigations and safety

instead of on external affairs or information technology. This report also

directed the Board to complete, by December 31, 1999, an updated

business plan, formal policies and procedures for awarding and managing

contracts, and formal procedures for selecting and performing

investigations.

The Board has made some progress in complying with these directives.

Specifically, on December 27, 1999, the Board issued formal written

procedures for awarding and managing contracts. Also, as discussed

above, in January 2000, the Board approved procedures that include

requiring contracts exceeding $10,000 to be approved by a majority vote of

the Board members. However, the procedures do not include guidance the

Board recognizes is needed for its staff on the technical review of goods

and services provided to it under contracts.

In addition, the Board requested an extension of time in developing an

update to its business plan because of the former Chairman’s announced

resignation from that position and the related governance issues. This

update will be accomplished by the development of strategic and

performance plans required by the Government Performance and Results

Act. On February 7, 2000, the Board provided a performance plan for fiscal

year 2001 along with its budget request for fiscal year 2001. The Board

plans to obtain feedback from stakeholders from industry, public interest

groups, government agencies, and labor unions on the strategic plan in July

2000 and complete it by September 2000.

17Chemical Safety Board: Status of Implementation Efforts (GAO/T-RCED-99-167, Apr. 29,

1999).
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On December 27, 1999, the Board also issued interim procedures for

selecting incidents to investigate. As of June 2000, the interim selection

criteria were being reviewed and thus were not ready to be used in

selecting incidents to investigate. Revising the selection criteria is one of

the Board’s eight priority actions for fiscal year 2000. The Board is revising

the process for selecting incidents to investigate and plans to meet with

stakeholders on the revised draft selection criteria in July 2000. One issue

that the Board did not clarify in the interim selection criteria is the

circumstances in which it would investigate a transportation-related

accident. The Board receives numerous daily notifications of chemical

accidents from the National Response Center, which include, at the Board’s

request, information on certain transportation accidents involving

chemicals, including pipeline and highway accidents.18

EPA and stakeholders such as the Chemical Manufacturers Association and

the American Petroleum Institute have also said that the Board should

clarify its primary mission and clearly define the Board’s role, if any, in

transportation accidents. The Board’s agreements with EPA and OSHA and

its interim investigative protocol indicate the Board may conduct

investigations of transportation accidents, but these documents do not

provide guidance on the overall focus of Board investigations (fixed

facilities versus transportation), nor do they indicate the circumstances in

which the Board would consider investigating a transportation accident.

Finally, on December 27, 1999, the Board issued an interim investigative

protocol that sets forth guidelines and procedures for the Board and the

staff to follow in conducting and reporting on investigations. The protocol

describes the activities necessary to conduct incident investigations from

inception through publication and includes two companion documents: a

set of detailed investigation procedures and a set of related investigation

forms and references. The protocol was issued as “interim” because the

Board recognized that it needed further development.19 Revising the

18The National Response Center serves as the sole national point of contact for reporting all

oil, chemical, radiological, biological, and etiological discharges into the environment

anywhere in the United States and its territories. It also maintains agreements with a variety

of federal entities to make additional notifications regarding incidents meeting established

trigger criteria.

19As noted earlier, a House conference committee report directed the Board to complete its

investigative protocol by December 31, 1999.
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investigative protocol is one of the Board’s eight priority actions for fiscal

year 2000.

The Board acknowledges that parts of the protocol require policy decisions

by the Board and that some of the policies and procedures need to be more

fully developed. For example, the Board needs to decide when its

investigators are to conduct interviews with accident witnesses alone and

when joint interviews with other agencies may be appropriate. Currently,

there is a conflict between the Board’s interim procedures and its

agreement with EPA. That is, the Board’s interim procedures state both

that it is the Board’s policy to conduct interviews alone and that the Board

prefers to interview witnesses separately. However, the Board’s agreement

with EPA states that interviews of witnesses will be conducted jointly with

EPA as often as possible to avoid duplicative efforts.

Also, a Board official said that the Board must decide such issues as

whether outside attorneys can be present when Board investigators are

interviewing witnesses and what type of confidentiality assurances the

Board can extend to interviewees. The Board plans to contract for expert

assistance to improve the investigative protocol. A Board official told us

that the focus of these improvements would be primarily on the procedures

for conducting investigations.
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Procedures Lack Specificity

to Ensure the Objectivity of

Investigations

The Board does not have regulatory or enforcement powers and must

maintain a reputation for impartiality and thoroughness in order to

convince its wide range of stakeholders—including chemical companies,

labor unions, scientific organizations, and other agencies—to implement its

recommendations. We found that the Board’s investigative protocol lacks

specificity in some areas that would help ensure objectivity and balance in

investigative work. Specifically, the Board’s interim investigative protocol

either does not address or partially addresses (1) a potential for conflicts of

interest, (2) the reporting of substantive disagreements among

investigative team members, (3) the reporting of minority views of Board

members in investigative reports and the handling of requests for

reevaluations of investigations, and (4) a clear external peer review policy.

Policies and procedures on these topics—which are included in the

investigative policies and procedures of some other investigative

agencies—promote objectivity by formalizing and standardizing agency

practices that are aimed at eliminating the potential for bias on the part of

investigators and board members and ensuring that the investigation

consider all relevant findings and analyses.20

Conflicts of Interest Conflicts of interest, or the appearance of conflicts of interest, could

seriously hamper the Board’s efforts to convince stakeholders to

implement its safety recommendations. Conflicts of interest may include,

but are not limited to, Board employees and contractors having a financial

interest associated with the facility being investigated or having been

previously employed or a consultant with the facility. Several protocols of

other federal agencies and boards inform members of the investigative

team about potential conflicts of interest by including statements or

sections on how to help prevent them from occurring. For example, the

Department of Energy’s (DOE) investigative protocol states that each

board member, adviser, and consultant must certify that he or she has no

conflicts of interest. In addition, the protocol states who to contact for

advice if there are concerns about potential conflicts of interest.

According to the Board’s General Counsel, the Board has reviewed

potential conflicts of interest at the Board. For example, he said that the

Office of General Counsel evaluated the potential for conflict of interest for

a Board member assigned as the primary overseer of an accident

20We reviewed the investigative protocols of the National Transportation Safety Board, the

Department of Energy, and the Nuclear Regulatory Commission and a draft Environmental

Protection Agency/Occupational Safety and Health Administration investigative guide.
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investigation at a company owned by the Board member’s former

employer. In addition, according to a Board official, the Board reviews the

terms of work included in contracts to determine if the contractors may

have any conflicts of interest. Board employees are also required to

receive annual ethics training and complete the standard annual financial

disclosure reports required of federal employees. The Office of General

Counsel reviews the financial disclosure reports.

However, the Board does not have formal, written policies on conflicts of

interest that would guide the reviews of potential conflicts by the Office of

General Counsel. Written guidance would help ensure the consistency and

thoroughness of conflict-of-interest reviews and would provide clear and

consistent guidance to the staff and Board members on actual or perceived

conflicts of interest, including actions required to mitigate potential

conflicts. Because the Board has recently determined that it will focus its

recruitment efforts on individuals with experience in the oil and chemical

process industries—ones that it will likely be investigating—it will be

increasingly important for the Board to have clear, consistent conflict-ofinterest guidance.

Staff Disagreements on

Investigations

During an investigation, disagreement between staff members and/or

management may occur on the facts or analysis of the case. According to

Board officials, divergent opinions of team members on investigations are

expected and welcome during the investigation. However, the goal is for

team members to come to an agreement before the draft report is sent

forward for approval. If no agreement can be reached at the team level, the

current investigative protocol states that the matter should be first taken to

the Director of Investigations and Safety and if not resolved at that level,

then taken to the Chief Operating Officer for resolution. However, the

protocol does not indicate that the inclusion of a record of such

disagreements can be made part of the official investigative file.

A systematic process for resolving professional differences of opinion can

help avoid the perception that an investigator’s findings are inappropriately

discounted. The Board has had to address an allegation by a former Board

investigator that investigators were in some cases being pressured to

change findings or recommendations inappropriately. In this case, the

Board investigated this allegation and concluded on the basis of, among

other things, statements from its investigative staff, that it was not

substantiated.
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We believe a process, such as one used by the Nuclear Regulatory

Commission (NRC), regarding professional differences of opinion would

be helpful to the Board both in ensuring that objectivity is maintained and

in responding to any similar allegations in the future. Specifically, NRC’s

investigation protocol requires each team member’s concurrence on

investigative reports, signifying that each team member has reviewed the

report and that any differences of opinion have either been resolved or are

documented in an appendix. This policy appropriately places a

responsibility on team members to disclose any outstanding differences of

opinion before the report is issued, allowing the decisionmakers to

evaluate these views. The policy establishes accountability for issues and

can protect NRC from allegations that known, relevant information was not

appropriately considered.

Minority Views of Board

Members and Requests for

Reevaluations

The NTSB investigative manual identifies the procedures to be followed if

all its board members do not concur on a report, including the option for

publishing the minority opinions in the final report. In contrast, Board

officials told us that they do not believe the minority views, if any, of its

Board members on investigative reports should be published in final

investigative reports because doing so would seriously hamper the Board’s

ability to have recommendations accepted and acted upon. Thus, the

investigative protocol does not provide for publishing dissenting opinions

of Board members in investigative reports. We found, however, that Board

officials have not discussed with NTSB officials their experience in

publishing minority views in investigative reports, including how this

practice affects their ability to convince stakeholders to implement

recommendations. Such discussions may help the Board clarify the pros

and cons of this policy, which offers the potential to enhance its reputation

for objectivity, thoroughness, and openness. In response to our questions,

a Board member acknowledged that such a discussion would be useful.

Another NTSB procedure that may be relevant to the Board provides that

all parties involved with the investigation or other interested persons may

petition for reconsideration of all or part of the analysis, conclusions, or

probable cause(s) identified in a published report. NTSB reviews such

petitions following established criteria to determine whether to grant them

in entirety or in part or to deny them. In contrast, the Board’s investigative

protocol does not address the circumstances in which the Board would

reconsider a published report.

Peer Review Peer review—the critical evaluation of scientific and technical work

products by independent experts—is an important mechanism for
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enhancing the quality, credibility, and acceptability of scientific and

technical reports. While the Board utilizes independent expert assistance

and peer review, its investigative protocol does not provide a clear policy

statement on its use of independent review. A section of the protocol

(separate from the investigative procedures) states only that the Board may

contract for technical review by recognized outside experts. Furthermore,

the tasks currently specified in the Board’s investigative procedures under

the topic “legal review and vetting of the report” do not address the use of

outside experts. This section states that the factual content portion of

reports will be provided to the “appropriate parties” to help ensure

accuracy. This guidance is implemented by providing copies to the affected

company, the employee’s union, and, in some cases, to other government

agencies involved in the incident investigation, for reviews for factual

accuracy and confidential business information. Finally, we found that the

Board’s issued reports do not identify the expert reviews that were

obtained.

We recognize that there are different peer review approaches the Board

could adopt. For example, a comprehensive peer review approach is

incorporated in a draft EPA/OSHA investigative protocol that requires

independent review of draft investigative reports before final reports are

issued. Alternatively, peer review can be obtained on specific investigative

issues. Nonetheless, the Board’s peer review approach is not clearly

defined in its investigative protocol. That is, the protocol does not indicate

whether expert technical reviews are generally required and whether the

technical reviews are to encompass the investigative report as a whole or

are to be limited to discrete technical elements. In addition, the protocol

does not address the disclosure in the relevant investigative reports of the

expert reviews obtained.

Institutional Oversight

of the Board’s

Operations and

Programs

Although the Board’s history suggests the need for ongoing oversight, the

Board is not subject to institutional oversight of its operations and

programs. To obtain the benefits of oversight, the Board could establish an

in-house audit and investigations unit, contract out for evaluations of its

operations and programs, or obtain the services of an existing office of

inspector general. We believe obtaining the services of an established

office of inspector general offers important advantages over the first two

options by, for example, offering the potential for the greatest degree of

audit independence. However, this approach could also have serious

limitations if it is not structured to give the inspector general the authority,

among other things, to initiate audits. For example, NTSB has obtained
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inspector general assistance using voluntary agreements that did not

permit the inspectors general to initiate audits. While this approach has

helped NTSB to some extent, the experience suggests that broader

inspector general oversight—enabling an inspector general to initiate

investigations as well as to perform audits in response to agency requests

and providing a hotline for agency employees—could be more effective in

helping to prevent fraud, waste, and abuse.

Board’s History

Demonstrates a

Vulnerability to Waste and

Mismanagement and a Need

for Oversight

The Board’s experience to date suggests the need for ongoing, institutional

oversight of its operations and programs. Specifically, the Board’s short

history is dominated by management conflicts, failures, and inefficiencies

that have resulted in the Board’s applying its scarce staffing and funding

resources to programs and activities that have provided little benefit while

its primary investigative mission has faltered. In the short term,

institutional oversight could assist the Board in developing sound policies

and procedures and in ensuring they are developed and implemented in a

timely fashion. Such assistance could help address a serious

shortcoming—the lack of a basic administrative infrastructure, including

policies and procedures to guide staff—that has contributed to the Board’s

problems and which still remains. In the longer term, ongoing institutional

oversight could help ensure that the Board’s policies and procedures are

being implemented and that the Board’s operations are efficient and

effective. In addition, with institutional oversight, the Board could obtain

guidance and assistance on sensitive matters, such as those that have

arisen from its governance conflicts.
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For example, the Board sought inspector general assistance on its own

initiative, in part because it recognized that an investigation into alleged

irregularities relating to an interagency acquisition agreement accepted by

the former Chairman and the former Chief Operating Officer needed to be

independent in both appearance and fact.21 Specifically, in December 1999,

the Board requested assistance from DOE’s Inspector General to resolve

problems it was experiencing with DOE for work to be performed by DOE’s

Oak Ridge National Laboratory under an interagency acquisition. The

issues included billing discrepancies and the potentially inappropriate use

of an interagency agreement to acquire goods and services.22 However, the

DOE Inspector General declined to conduct an investigation to address the

Board’s allegations, primarily because the agency’s officials determined

that the Board’s allegations did not indicate wrongdoing or fraud on the

part of DOE or its contractors. Rather, the DOE Inspector General believed

that the Board’s allegations indicated poor project management oversight

of the contractor and potentially the inappropriate use of an interagency

acquisition—problems stemming from the Board’s actions rather than from

DOE or its contractors.

Several Options Exist for

Institutional Oversight

To provide on-going, institutional oversight of its operations and programs,

the Board could adopt one of several approaches. For example, the Board

could establish an in-house audit and investigations unit, contract out for

evaluations of its operations and programs, or obtain the services of an

existing office of inspector general. While the first two options may be

appropriate in some cases, we do not believe either is appropriate for the

Board for several reasons.

An in-house unit does not appear practical because of, among other things,

the continuing management conflicts at the Board that could hamper the

effectiveness of this unit and the limited staffing that would reasonably be

allocated to this function at an agency of this size. While a very small unit

could potentially provide needed oversight of the Board, we believe

benefits would be better ensured with a larger staff of varied expertise.

Such benefits could also be achieved by contracting out the audit and

investigative function. However, considering the Board’s past contracting

21Board officials also told us they did not have the resources internally to pursue the matter.

22As of June 2000, $2.3 million has been obligated under this agreement, referred to as a

work-for-others agreement, entered into in fiscal year 1998.
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problems, the numerous priorities the Board is trying to accomplish to

demonstrate it is a viable agency, and the limitations of contracting both in

terms of audit independence and the potentially limited duration of the

contracting relationship, we do not believe this approach offers the optimal

way for the Board to obtain institutional oversight.

Obtaining the services of an established office of inspector general offers

several important advantages over in-house or contracted audit and

investigative support, provided that the arrangement is appropriately

structured. First, of the three options, this approach offers the potential for

the greatest degree of audit independence from the Board. In addition, this

approach would allow the Board to benefit from the varied expertise of

staff at an existing office of inspector general. While maintaining objective

independence, such staff are to accomplish the mission of these offices by

(1) conducting and supervising audits and investigations of programs and

operations and (2) providing leadership and coordination and

recommending policies to promote economy, efficiency, and effectiveness

and to prevent and detect fraud and abuse. In addition, offices of inspector

general offer a continuity of oversight over time, and they are required to

keep agency heads and the Congress informed about problems and

deficiencies existing at the agencies—important aspects that contracting

may not provide.

We recognize that the Board would likely have to allocate funding to

reimburse an office of inspector general for oversight services. Given the

problems that have arisen in the Board’s 2-1/2 years of operation, however,

we believe that such funding is appropriate. Funding may be available

from the information technology savings the Board has identified, and the

Board can include an allocation for inspector general oversight in its

budget requests.

NTSB’s Experiences

Provide Insights for an

Effective Inspector General

Model

While we believe the use of an existing office of inspector general offers the

best potential for effective institutional oversight, we recognize that this

approach could also have serious limitations if it is not structured, for

example, to give the inspector general the authority to initiate audits. In

this regard, the Board can benefit from the experience of NTSB—the

agency that provided the organizational model for the Board. Like the

Board, NTSB does not have a designated inspector general to provide

institutional oversight. However, NTSB has had agreements with the Office

of the Inspector General of both the General Services Administration

(GSA) and Department of Transportation (DOT) to provide oversight
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assistance. According to the DOT Inspector General, these agreements

allowed NTSB to request specific assistance from these offices but did not

allow the Inspector General to initiate work, follow up on agency

responses to its reports, or provide a hotline for agency staff to report

allegations of fraud, waste, or abuse.

The DOT Inspector General has indicated that these limitations in

inspector general oversight may have contributed to recent cases in which

NTSB employees forged records and embezzled funds. For example, NTSB

employees had raised concerns to the Chief Financial Officer that users of

a financial system were not complying with internal controls, but the Chief

Financial Officer did not take appropriate steps to address the problems

they had identified. If NTSB had had an institutional oversight

organization, the employees who reported irregularities to the Chief

Financial Officer would have had an in-house channel (a hotline) to pursue.

In addition, a prior GSA Inspector General report had identified internal

control weaknesses that, had they been corrected, could have prevented

the embezzlement. However, NTSB did not implement them. According to

the DOT Inspector General, the likelihood of NTSB taking effective

corrective action would have been greater if the GSA Inspector General

had been in a position to follow up on its audit results.

A House bill (H.R. 2910) passed in September 1999 contains a provision

addressing institutional oversight of NTSB.23 Specifically, it would give the

DOT Inspector General the authority to oversee the financial management

and business operations of NTSB, including internal accounting and

administrative control systems, to determine compliance with federal laws,

rules, and regulations. Under the bill, NTSB would reimburse the inspector

general for the costs associated with carrying out these activities. In

testimony before the Congress, NTSB stated that it strongly favors having

the ability to resort to independent, expert assistance as a means of quality

assurance and improved performance, and the DOT Inspector General

agreed that institutional oversight of the NTSB is appropriate.

23The related Senate bill, S. 2412, was reported out of the Committee on Commerce, Science

and Transportation in June 2000 with a similar provision.
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Given the small size of the Board and the fact that it could benefit from

timely and ongoing institutional oversight, an approach similar to the one

being considered for NTSB appears to be appropriate for the Board as well.

That is, an existing office of inspector general could provide the Board with

timely and necessary oversight, rather than a separate office of inspector

general for the Board, which would have to be created.24 Furthermore,

benefiting from the NTSB experiences, the designated office of inspector

general could be structured to provide the inspector general with the

authority to initiate audits and investigations; provide a hotline for

reporting fraud, waste or abuse; follow up on agency responses to its

recommendations; and report to the agency head and the Congress on

existing problems and deficiencies at the Board.

In terms of possible offices of inspector general to assume this role, one

option would be the Department of the Treasury’s Office of the Inspector

General because the Board currently is contracting with Treasury’s Bureau

of the Public Debt for various support services. According to Board

officials, however, the Department of the Treasury’s Office of Inspector

General has told the Board that it was not interested in providing hotline

services to the Board. Other options include, but are not limited to, the

Offices of Inspector General at the Federal Emergency Management

Agency, EPA, and DOT.

Conclusions The Board’s initial steps since the management realignments in December

1999 and January 2000 appear to be appropriately targeted to addressing

the problems that we identified in April 1999. The priorities the Board has

established for fiscal year 2000, including the hiring of six qualified

investigators and the completion of three investigative reports, are critical

ones that the Board must accomplish to demonstrate that it is a viable

agency capable of accomplishing its important safety mission in an

efficient and effective manner. The Board’s unique chemical safety mission

must be accomplished by persuasion rather than through regulatory or

legal powers. It is therefore incumbent upon the Board to develop and

consistently use policies and procedures that can help ensure objectivity

and thoroughness. If the Board is perceived as being either biased or

incomplete in its investigative work, its effectiveness will be diminished or

24The Congress has created separate offices of inspector general for some small agencies

and boards, including the Federal Housing Finance Board, the Federal Labor Relations

Authority, and the Federal Maritime Commission.
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even lost. The Board could better ensure objectivity if it had clear policies

and procedures addressing issues such as potential conflicts of interest,

substantive disagreements among investigation team members, the

minority views of Board members, requests for reconsidering aspects of

issued reports, and the nature and extent of external peer review that is to

be obtained and the identification of such reviews in its investigative

reports.

On-going, institutional oversight by an existing inspector general could

enhance the Board’s ability to carry out its mission and better protect the

government’s financial interests. The Board is clearly at risk for fraud,

waste, and abuse, as evidenced by its contracting expenditures of limited

value, lack of basic policies and procedures, poor productivity, and

governance and management conflicts. NTSB’s experience suggests that

such oversight would be most effective if a designated inspector general for

the Board had the authority to initiate investigations, follow up on them,

and provide a hotline to report any allegations of suspected fraud, waste, or

abuse.

Recommendations We recommend that the Board develop and implement clear policies and

procedures on potential conflicts of interest and consider other policies

and procedures that would further promote investigative impartiality and

thoroughness, such as ensuring substantive disagreements among

investigative team members are appropriately identified and addressed, the

reporting of minority views of Board members in investigative reports, the

handling of requests for reconsideration of aspects of issued reports, and

external peer review.

To provide the Board with the benefits of independent institutional

oversight and to protect the government’s financial interests, we

recommend that the Board develop an agreement with an existing office of

inspector general, giving that office the authority to investigate the Board’s

operations and programs, monitor agency responses to its

recommendations, report to the Board and the Congress about weaknesses

and deficiencies, and provide a hotline to report instances of suspected

fraud, waste, or abuse. We further recommend that the Board notify the

Congress in the event that it is unable to negotiate an agreement for these

services with an existing inspector general.
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Scope and

Methodology

To review the status of the Board’s efforts to carry out its mission, we

reviewed documents supplied by the Board related to its organization,

planning, and budgeting; policies and procedures; programs; personnel

data; and contract files. We also interviewed Board employees, including

Board members, attorneys, investigators; and officials from stakeholder

organizations, including the Chemical Manufacturers Association, the

American Petroleum Institute, and the Center for Chemical Process Safety.

To report on the Board’s procedures aimed at ensuring the objectivity of its

investigative activities, we reviewed the Board’s interim investigative

protocol and held discussions with Board members and the investigative

staff. We also reviewed the investigative policies and procedures of other

agencies that conduct similar investigations, including the National

Transportation Safety Board, the Nuclear Regulatory Commission, the

Department of Energy, and the Environmental Protection Agency.

Our examination of whether the Board would benefit from independent

oversight of an inspector general relies, to a great extent, on the results of

this review of the Board as well as our earlier review in 1999. We also

examined the experience of NTSB in obtaining institutional oversight.

We conducted our work from January through June 2000 in accordance

with generally accepted government auditing standards.

Agency Comments We provided a draft copy of this report to the Board for its review and

comment. In commenting on the report, Board officials agreed with both

of our recommendations, stating that the observations and

recommendations in the report will help to strengthen the Board’s

operations. However, the Board believed it needed to clarify that the

problems cited in the report were the result of the prior Chairman’s tenure

and that the decisions and actions were made under his sole authority. The

report clearly identifies the relevant dates or time periods associated with

the operational activities discussed in the report and with the Board’s

organizational changes, including the former Chairman’s resignation as

Chair. For example, we point out that prior to the management

realignments in December 1999 and January 2000 and the establishment of

contracting policies and procedures in December 1999, contracting actions

were the responsibility of the former Chairman and the former Chief

Operating Officer, and the other Board members did not have a role in

reviewing or approving contracts. Accordingly, we believe our report’s

discussion of these matters was fair and complete.
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In addition, the Board stated that there is no on-going “governance”

disagreement because the governance structure—based on majority

voting—that has been in place since January 2000 is in compliance with the

statutory interpretations of both its General Counsel and of the Justice

Department. The opinion of the Justice Department was issued on June 26,

2000, after we had provided our draft report to the Board. We have revised

our report to reflect this Justice Department opinion and to distinguish

between governance conflicts and ongoing disagreements between three of

the Board members and the former Chairman about the management of the

Board. The Board’s comments are provided in appendix I.

We are providing copies of this report to interested congressional

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Issues
Page 34 GAO/RCED-00-192 Chemical Safety Board

Appendix I

Comments From the Chemical Safety and Apendxies

Hazard Investigation Board ApendxiI
Appendix I

Comments From the Chemical Safety and

Hazard Investigation Board

Page 35 GAO/RCED-00-192 Chemical Safety Board
Appendix I

Comments From the Chemical Safety and

Hazard Investigation Board

(160511) Letr Page 36 GAO/RCED-00-192 Chemical Safety Board
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