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Examination Report: OAS-RA-13-09

February 19, 2013

North Carolina State Energy Office − Energy Efficiency and Conservation Block Grant Program Funds Provided by the American Recovery and Reinvestment Act of 2009

As part of the American Recovery and Reinvestment Act of 2009 (Recovery Act), the Energy Efficiency and Conservation Block Grant (EECBG) Program received $3.2 billion to develop, promote, implement and manage energy efficiency and conservation projects and programs designed to reduce fossil fuel emissions, reduce total energy use of the eligible entities, and improve energy efficiency in the transportation, building and other appropriate sectors.  The North Carolina State Energy Office's (Agency) received a $20.9 million competitive grant award that was to be expended over an initial 3-year period from September 21, 2009 through September 20, 2012; however, the Agency requested and received an extension of its grant to March 2013.  The Department of Energy’s (Department) Office of Inspector General contracted with an independent certified public accounting firm, Lopez and Company, LLP (Lopez), to conduct an examination of the Agency’s EECBG Program.  The examination found that the Agency’s quarterly reports on jobs created and retained were incomplete.  Further, the months included in the reports were inconsistent with the periods required to be reported under the Recovery Act and guidance on job reporting provided by the EECBG project officer was not consistent with Program policies and procedures according to EECBG Program officials.  The issues identified occurred, in part, because the Agency did not have a formal process to record and track timely submissions of jobs data received from sub-recipients and lacked sufficient staffing resources to perform the necessary tracking and follow-up in a timely manner.  In response to the finding, the Department concurred with the recommendations and initiated corrective actions to improve the Agency’s administration of the EECBG Program.

Topic: Financial Assistance