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Audit Report: OAS-RA-11-13

August 23, 2011 

The Department of Energy's Weatherization Assistance Program Funded under the American Recovery and Reinvestment Act in the State of Indiana

Our review did not reveal material problems with the State of Indiana's management of the Weatherization Program and the three local agencies we visited - Hoosier Energy Rural Electric Cooperative, REAL Services, Inc., and Indiana Builders Association (IBA).  We did, however, identify opportunities for the State and IBA to improve the efficiency and effectiveness of their Weatherization Programs.  Specifically, we found that IBA had not always maintained documentation to support weatherization material costs reimbursed by the State, even though it was specifically required to do so.  For 22 of the 23 homes we sampled, we found that contractors had requested reimbursement for "special circumstance charges."  Such charges, totaling about $8,000 for the homes we reviewed, included reimbursement requests for custom sized doors, window sealing, electrical fittings, and related labor that were not included in IBA's established price list.  Payments were made without necessary supporting information because the State had not enforced policies and regulations that require adequate documentation to support contractor billings.  We also found that IBA had not always taken action to ensure that dwellings had been disqualified from receiving Recovery Act funded services because they had received weatherization services in the past.  The Recovery Act stipulates that Department funds may not be used on units that had been weatherized anytime after September 30, 1994.  The information needed to enforce this requirement was limited, since the State's database included only homes weatherized after 2000, and weatherization auditors employed by IBA did not take action to verify the source of any previous weatherization work performed on homes they assessed.  The Department of Energy concurred with the findings and recommendations contained in our audit report.  The State of Indiana and the IBA generally agreed with our observations and conclusions.  Planned actions are responsive to our recommendations. 

Topic: Financial Assistance