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Report Sheds More Light on Misconduct by Nuclear Contractor

Sandia National Laboratories sign
(Photo: Sandia Labs / Flickr)

A newly revealed version of a Department of Energy Inspector General report provides details of how Sandia National Laboratories, under the management of Sandia Corporation, used federal money to lobby government officials for a no-bid extension of the contract worth $2.4 billion a year. This use of taxpayer dollars for this purpose is not only unethical, but also violates United States Code, Federal Acquisition Regulations, Sandia Corporation’s internal policies, and their contract with the National Nuclear Security Administration (NNSA).

The contract for management of Sandia National Laboratories will end in May 2017. The NNSA, an agency within the Department of Energy, is opening the contract for competitive bid.

Currently, the Lab is managed by the Sandia Corporation, a wholly owned subsidiary of Lockheed Martin Corporation—which is ranked first in POGO’s Federal Contractor Misconduct Database. Due to the breach of contract and violation of federal laws when Sandia Corporation misused taxpayer dollars, Lockheed Martin should not be allowed to compete for the contract to manage the Lab in 2017.

The Project On Government Oversight wrote about this issue before, but new information recently came to light. Through the Freedom of Information Act, The Center for Public Integrity acquired  a version of the Department of Energy Inspector General’s report on its “Special Inquiry” into Sandia Corporation’s lobbying that included more information than the report released to the public in November 2014.

The previously unreleased version reveals more about the lobbying done by the Lab—namely, that it acted intentionally with awareness of the illegality of the lobbying.

The Inspector General’s report quotes an email from within the Lab: “this smack[s] squarely into the definition of lobbying congressional members.”

The Lab labeled this plan a “capture strategy,” and hired investigators to execute it. According to the report, the Lab’s intended use of the consultants and the strategy was to educate officials about the contractor’s self-defined successful performance, not influence them. For a goal of “education,” the Lab spent almost half a million dollars. One consultant was former New Mexico Representative Heather Wilson, who began her work for the Lab the day after she left office. Not only did the Lab misuse federal funds, there was no assurance that Wilson actually provided any services.

The report quotes Wilson’s firm, Heather Wilson LLC, advising the Lab to “aggressively lobby, but keep a low profile.” If the Lab’s actions and intentions were ethical and legal, a low profile should not be necessary.

Sandia Corporation paid the consultants with taxpayer dollars, violating their contract and federal laws. In the report, Sandia Corporation justifies this by saying that they used operating costs in the same way to secure extensions in 1998 and 2003. So not only have they broken the law, they’ve done it three times. And the DOE continues to renew their contract and grant their award fees.

Although the Lab repaid the federal money they spent on lobbying in the most recent instance, the Lab’s statements and actions reflect values that do not respect the law or the taxpayers of this country. A company that violates federal laws and their contract with the government should not be allowed to continue receiving multi-million dollar contracts or be trusted to manage nuclear weapons facilities.

By: Katie Cooney
Intern, POGO

katie-cooney Katie Cooney is an intern at the Project On Government Oversight.

Topics: Contract Oversight

Related Content: Contractor Accountability, Nuclear Power, Nuclear Security, Contractor Misconduct

Authors: Katie Cooney

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