Friday, November 14, 2014

DOE Blames SNL Management

In a Summary Report by the Department Of Eenergy-Office of the Inspector General (DOE-OIG) dated 7 November 2014, the OIG describes findings obtained from an investigation of charges that Sandia National Laboratory (SNL) managers did illegally attempt to interfere with Sandia Corp's ongoing contract negotiations with the DOE's National Nuclear Security Administartion (NNSA,) by means of actively lobbying the DOE, as well as the US Congress, for a non-competitive contract extension. As a part of this illegal lobbying effort, Sandia Corp hired outside consultants, one of which was Heather Wilson, LLC. Sandia Corp is the for-profit management entity that manages SNL for the NNSA.

 It is clear in the US Code that the lobbying of US goverment agencies, such as the DOE or the US Congress, by contractors to the US government, such as Sandia Corp, is illegal, when conducted for the purpose of affecting contract negotiations.

 Nevertheless, Sandia Corp managers actively engaged in such lobbying efforts, which began in March, 2009 and have been ongoing until very recently.

 In its Summary Report, which is available to the general public, the OIG does not assign blame to individuals, beyond noting that, pursuant to the effort by Sandia Corp to influence ongoing contract negotiations with the NNSA:

1) a Contract Strategy Team was formed at SNL by Sandia Corp managers;

1) a consultant, Heather Wilson LLC, was hired by Sandia Corp;

2) altogether, three consultants were hired by Sandia Corp.

 Also, in its Summary Report, the OIG asserts that consultant fees, as well as other costs related to the illegal lobbying effort, which had been charged to the DOE by Sandia Corp, are to be reimbursed to the DOE.

 As a part of Sandia Corp's management response to these charges, as described in an Attachment to the Summary Report, Sandia Corp management said: "The Sandia Field Office conducted a review of fees paid to a consultant named in this report and, as a result, Sandia Corp reimbursed NNSA $226,378 in April 2013."

 Sandia Corp also said: "The Sandia Field Office will evaluate the outcome of the reviews conducted to determine allowability of salaries and/or fees paid by Sandia Corp for activities of the SNL Contract Strategy Team to determine if any adjustment to performance fees is warranted ... The estimated completion date for this action is March 2, 2015."

 It would be of interest to the general public to know the depth of involvement in this illegal lobbying effort by Sandia Corp individual senior managers; i.e., especially as might pertain to the Sandia Corp Director, and the Sandia Corp Associate Directors. This group of individuals takes home lucrative salaries and bonuses every year, and it would be in their particular interest to perpetuate the highly remunerative arrangement that Sandia Corp has with the DOE; e.g., to the tune of $2.4 billion per year, as mentioned in the Summary Report. In fact, the Sandia Corp Director alone recieves an annual total compensation package in excess of $2 million.

 Sandia Corp is a wholly owned subsidiary of Martin Marietta, merged since 1995 with the Lockheed Corp to form the Lockheed Martin Corp.

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