Bureau of Indian Affairs' Participation in a Proposed Hydroelectric Facility at Kootenai Falls, MT

RCED-84-126: Published: Jul 11, 1984. Publicly Released: Aug 9, 1984.

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The Department of the Interior's Bureau of Indian Affairs (BIA) has an agreement with a group of electric cooperatives to pay up to 10.5 percent of the costs of determining the feasibility of, and obtaining a license for, constructing and operating a hydroelectric power generating facility at Kootenai Falls, Montana. Within BIA, the Flathead Indian Reservation Irrigation and Power Project has responsibility for administering the agreement. Pursuant to a congressional request, GAO reviewed BIA participation in the venture to determine whether federal funds were properly spent.

GAO found that, while BIA partially paid for its share of the feasibility study and license application costs with reprogramed funds, the reprogramming of these funds was not reported to Congress. In addition, GAO found that BIA improperly used revenues from the Flathead Project to help pay its share of the costs of the Kootenai Falls venture. GAO also found that internal controls for the Flathead Project were inadequate in that: (1) the financial staff for the Flathead Project was not sufficiently trained or experienced in the financial management of such a complex project; and (2) since the Flathead Project's administrative officer position became vacant, project engineers have had responsibility for reviewing, approving, and certifying all financial transactions, in addition to authorizing project expenditures. As a result of financial management problems and tribal opposition to the Kootenai Falls venture, BIA has suspended its participation in the venture pending a determination by Interior's Solicitor as to the appropriateness of BIA participation. In addition, the staff and an administrative law judge of the Federal Energy Regulatory Commission have recommended that the Federal license for construction and operation of the Kootenai Falls facility be denied, but GAO believes that litigation could delay a final decision on the license for several years.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: If Interior's Solicitor determines that it is in the government's and the Flathead Indian Reservation's best interests for BIA to continue its participation in the Kootenai Falls venture, the Secretary of the Interior should direct the Assistant Secretary for Indian Affairs to develop and present to Congress funding proposals for continued BIA participation.

    Agency Affected: Department of the Interior

  2. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Interior should direct the Assistant Secretary for Indian Affairs to reimburse the Flathead power project revenues from an available appropriation account or seek a deficiency appropriation from Congress for that purpose.

    Agency Affected: Department of the Interior

  3. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Interior should direct the Assistant Secretary for Indian Affairs to terminate the use of Flathead power system revenues for Kootenai Falls feasibility study and license application costs.

    Agency Affected: Department of the Interior

  4. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Interior should direct the Assistant Secretary for Indian Affairs to report to congressional appropriations committees all reprogramming actions and the total funds made available for funding the BIA share of Kootenai Falls feasibility study and license application costs.

    Agency Affected: Department of the Interior

  5. Status: Closed - Implemented

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Interior should direct the Assistant Secretary for Indian Affairs to ensure that the financial management system at the Flathead Indian Reservation Irrigation and Power Project complies with the Comptroller General's internal control standard requiring adequately trained and experienced personnel.

    Agency Affected: Department of the Interior

 

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