Proposed Plan of DOE for the Distribution of Overcharge Refunds

GAO was asked to review its supplemental opinion concerning the legality of a proposed plan of the Department of Energy (DOE) for the distribution of overcharge refunds obtained as a result of a settlement. GAO was asked to consider the legality of the denial of the DOE Office of Hearing and Appeals (OHA) of several petitions by enforcement officials to utilize regulation procedures; the solicitation of public comments on the manner in which consent order funds should be distributed by DOE; the proposed use by OHA of overcharge funds, including interest, to cover its administrative costs; the discretionary authority granted to OHA to distribute consent order funds either to the Department of the Treasury on in any other manner specified; and the distribution by the former Special Counsel of $1 million to each of four charitable institutions from an escrow account established pursuant to an earlier settlement. GAO was also asked to provide an indication of the actions that should be taken to correct the situation, as well as an analysis of the obligations of the Special Counsel. GAO concluded that: (1) OHA may not lawfully deny petitions; (2) OHA may solicit public comments only as a means of identifying and locating those who are entitled to refunds; (3) OHA may not use any portion of the funds to pay its own administrative expenses; (4) OHA may not distribute surplus refunds except to effect restitution to those hurt by the overcharges in question, or for deposit in the Treasury; and (5) the Special Counsel had no authority and acted unlawfully in distributing overcharge refunds to charitable institutions. DOE should attempt to collect from the charitable organizations and the former Special Counsel the funds he improperly ordered to be disbursed. The matter is being referred to the Justice Department for its consideration in connection with any further action required.