Synthetic Fuels Corporation's Use of an Expert Panel and a Staff Assistance Agreement

Congressional concern has been expressed over the propriety of: (1) the Synthetic Fuels Corporation's (SFC) establishment of an outside expert advisory group, referred to as a study panel; and (2) an SFC agreement with the Environmental Protection Agency (EPA). These activities are two of the efforts SFC has undertaken since its establishment in 1980 by the Energy Security Act to assist in the development of U.S. synthetic fuels industry. GAO reviewed these efforts to determine the origins and evolution of the study panel and the EPA agreement activities.

GAO found nothing to indicate that either the use of the panel or the EPA agreement was unauthorized under the Energy Security Act. However, GAO believes that an earlier announcement of the panel activity to the entire Board of Directors and, at a minimum, to other senior SFC executives would have been more prudent. In addition, SFC should have advised the panel members earlier of the intended scope of the panel. GAO also found contrasting opinions on the panel's purpose and on the political and technical balance of the original group of experts who were scheduled for a January meeting that was canceled. With respect to the EPA agreement, little activity has occurred and none is presently planned. EPA and SFC completed a memorandum of understanding (MOU) which provides for temporary assignment of EPA employees to SFC. Nevertheless, with the exception of the Presidential management intern who worked at SFC in the spring of 1981 prior to the MOU, no EPA employees have been assigned to SFC. Furthermore, neither SFC nor EPA currently anticipates a need for the temporary assignment of EPA employees to SFC because SFC has established and begun staffing its own environmental office.