Nuclear Waste: Nevada's Use of Nuclear Waste Grant Funds

DOE contracted with an independent auditor to review GAO's findings. The auditors concluded that $198,252 in federal funds expended by Nevada were not spent in accordance with federal law and that there was insufficient documentation supporting the expenditure of another $493,583. Therefore, on June 11, 1998, DOE notified Nevada that it would not approve any withdrawals that would take the balance of grant funds below $691,835--the sum of the questioned amounts. After providing the state with an opportunity to provide additional support for the questioned expenditures, DOE, in a letter dated September 9, 1998, notified Nevada that it would reallocate the questioned funds as its means of recouping the funds.

DOE adopted an alternative strategy for ensuring that Nevada's internal controls over grant funds comply with federal standards. This should accomplish the objective of better ensuring that grant funds are adequately protected and that fund recipients comply with applicable laws and regulations. To ensure that there is a common understanding on the permissible uses of nuclear waste funds provided to Nevada, DOE is providing guidelines on the statutory restrictions applicable to expenditure of Nuclear Waste Fund monies to the state, counties in Nevada and California that receive Nuclear Waste Funds grant monies, and the agency designated under the Single Audit Act to audit the state's use of federal funds. DOE intends to provide the guidelines when Congress appropriates funds for the state's nuclear waste oversight function. DOE intends to request that the designated audit agency audit the state's and the counties' expenditures of future waste fund monies against those restrictions.