Tennessee Valley Authority:

Special Air Transportation Services Provided to Manager of Nuclear Power

GGD-89-117BR: Published: Sep 25, 1989. Publicly Released: Nov 27, 1989.

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Pursuant to a congressional request, GAO reviewed the Tennessee Valley Authority's (TVA) provision of special air transportation services to its manager of nuclear power.

GAO found that TVA: (1) contracted for the manager's services in January 1986, in response to growing concerns over and problems with its nuclear power program; (2) continued the contractual arrangement, since a June 1986 GAO determination that the contract exceeded statutory ceilings on compensation was not legally binding; (3) reimbursed the manager for out-of-pocket expenses he incurred in commuting between his home in Charlottesville, Virginia, and his office in Chatanooga, Tennessee, until October 1987, when it amended the management services contract to provide air transportation services; (4) provided $172,700 in air transportation services to the manager, including three trips with his wife, between October 2, 1987 and September 30, 1988; (5) provided the transportation through use of a contractor, agency, and commercial aircraft; (6) provided the transportation as an incentive after becoming concerned that the manager's absence from his residence would adversely affect his continued availability to TVA; and (7) did not routinely provide special air transportation services to its employees or contractor employees. GAO also found that: (1) only the Internal Revenue Service could determine whether the fair market value of the transportation services TVA provided should be considered taxable income; and (2) it did not know how the manager, his wife, or his personal services firm treated the services for federal income tax purposes.

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