Department of Energy's Use of Contracts for Moving and Storage Services

A recent review of the Department of Energy's (DOE) use of contracts for moving and storage services revealed that many problems exist pertaining to the DOE use of these contracts. That DOE did not adhere to Federal regulations or sound procurement practices and did not provide adequate contract management and controls to protect the Government's interests indicated a high degree of irresponsibility on the part of DOE officials. Current Federal Property Management Regulations provide that the General Services Administration (GSA) will award term moving contracts for use by Government agencies when moves are estimated to cost $5,000 or less. DOE used a term moving contract for large moves exceeding the $5,000-limitation provision of the contract. Contractor personnel were used for services unrelated to moving. Poor contract administration was evident in the lack of DOE control over the amount of services billed by the contractor. DOE officials relied solely on contractor-maintained time sheets as support for services furnished. DOE used three contractors for storing office furniture. It estimated the value of this furniture to be between $2.5 million and $4 million. GAO estimated its value at about $1 million, but the lack of independent DOE inventory controls and records made it impossible to determine precisely what was stored. Again, it was noted that there was a lack of concern for the Government's interests. At one location where DOE had no formal contract, more than $180,000 in DOE furniture was destroyed in a fire. Two of the three contractors used by DOE for storage and transportation were subsidiaries of the same parent company. An apparent conflict-of-interest situation existed because much of the new furniture delivered to these warehouses was delivered by the parent contractor. Some time after the GAO review began, DOE took steps to provide surveillance and establish some inventory controls.