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Examination Report: OAS-RA-13-04

November 8, 2012

The Department of Energy's American Recovery and Reinvestment Act Energy Efficiency and Conservation Block Grant Program – Efficiency Maine Trust

The American Recovery and Reinvestment Act of 2009 (Recovery Act) was enacted to promote economic prosperity through job creation and encourage investment in the Nation's energy future.  As part of the Recovery Act, the Energy Efficiency and Conservation Block Grant (EECBG) Program received about $3.2 billion to assist in implementing strategies to reduce fossil fuel emissions, decrease total energy use of local governments, improve energy efficiency and create jobs.  The State of Maine established the Efficiency Maine Trust (Trust) to take over responsibility for all non-transportation related energy efficiency programs and administer the State's EECBG Program, totaling about $9.6 million.  The Department of Energy's (Department) Office of Inspector General, contracted with Otis and Associates, PC, an independent public accounting firm to conduct an examination of the Trust's EECBG Program.  The examination found that the Trust lacked adequate records to support grant related expenditures by subgrantees.  Specifically, expenditures claimed by 9 of the 56 subgrantees reviewed in a sample were not supported with adequate documentation.  As a result, about $560,000 of expenditures claimed were questioned.  The lack of adequate documentation occurred because the Trust has not enforced the provisions in the award agreement that requires subgrantees to retain and provide documentation supporting expenditures.  In response to the finding, the Department concurred with the recommendations, and along with the Trust, proposed corrective actions to improve the administration of Recovery Act EECBG funds and to resolve questioned costs.

Topic: Financial Assistance