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OIG: NASA Has 15,000 Unclosed Expired Awards

By Keith Cowing
NASA Watch
February 12, 2014
Filed under ,

NASA OIG: Final Report – IG-14-014 – NASA’s Award Closeout Process, NASA OIG
“As of October 2013, NASA had more than 15,000 award instruments that had expired but were not yet closed. NASA contracts with a private company to assist with the closeout process. The OIG found that although NASA has slowed the growth of its backlog of instruments awaiting closeout, the Agency needs to make further improvements to its closeout process.”

NASA Watch founder, Explorers Club Fellow, ex-NASA, Away Teams, Journalist, Space & Astrobiology, Lapsed climber.

3 responses to “OIG: NASA Has 15,000 Unclosed Expired Awards”

  1. dogstar29 says:
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    This report suggests to me that the OIG really does not understand, or even attempt to understand, the realities of either performing or funding NASA research. To get a grant the researcher has to struggle for months or years. Often the money won’t even actually transferred until the period of performance is half over. You were required to say exactly what earth-shattering discovery you were going to make and the day you were going to be completely finished. Unless the research is completely trivial, it often takes more time than expected to finish, and there is no way of predicting when you will get another grant. If the money runs out first you will have to fire your graduate students or research contractors who have finally, after six or eight months, become somewhat proficient and capable of actually getting useful work done for NASA. But when the end of the funding period arrives (less than one year because of delays in getting the money) you have to splurge and get rid of all the money before COB on Friday. No, it doesn’t matter if you waste it all as long as you can justify it on paper, and yes, if you try to save the government money by not spending it until you can use it productively, the money will be taken back and you will reduce your chances for another grant.

    So the NASA Research Funding Handbook suggests that a no-cost extension be granted. Why not? It isn’t costing the government anything if you keep the money in the bank until you actually need it, and it lets you keep your research team together and working instead of spending all your time writing proposals and trying to start over from nothing.

    But what OIG is saying is that if you don’t waste all the remaining funds on the day the period of performance ends and immediately fire everyone, including yourself, the money goes back to the US treasury to be used building bridges to nowhere. The problem with this is that it guarantees that most of the money will be wasted. Also, the suggestion that a large part of the NASA budget is spent on research grants to educational institutions is deceptive. The total funds involved are trivial compared to what is spent on SLS.

    Note that in the paragraph below the OIG is not talking about $6B or even $6M. They are talking about a total of six THOUSAND dollars in added service fees in all the contracts they looked at.

    “Second, although we found that NASA generally deobligates unused funds in a timely manner, we identified $2.7 million in funds not timely
    deobligated. Based on this finding, we estimated that Agency-wide, NASA has more than 4,000 instruments with $61 million in funds that were not deobligated in a timely manner. Third, the Agency incurred $6,699 in unnecessary service fees associated with grant accounts that remained open past the period of expiration.”

    “A Grant Research Assistant at NASA assigned to this award received approval from the Technical Officer to extend the grant. The Research Assistant stated that the funds would have expired if they deobligated the money so it was in NASA’s best interest to approve the request. In our view, given the late receipt of multiple requests for extension and the substantial change of scope in the proposal, the original grant should have been closed and the remaining funds deobligated. If new work was determined to be necessary by the Center, a new grant should have been awarded.”

    Do they have any idea how hard it is for a center to get new funds for new work? How much it costs in the time of all the people involved? What really scares me is that instead of telling the contracting officers and contractors to work things out, they have hired a new contractor to “close out” all the extended contracts. They won’t say how much their contractor is getting paid, but they do say they want to “incentivize” the contract closing contractor to shut all these contracts down and deobligate the money. Whether the contracts are doing useful work does not seem to be worth discussing.

    • Steve Whitfield says:
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      When you take OIG out of the picture and replace it with a cost accounting department/manager, then you can see most of what you’ve described in non-government operations as well.

      Any department manager knows that if you don’t spend all of this year’s budget by the fiscal year end you won’t get as much money next year. So everybody rushes out in the 12th month to buy whatever they can possibly justify, whether it’s currently needed or not, so as to spend the entire budget.

      And it’s always nice to have a list of things that you “need” but didn’t have the money for this year.

      The thing that has always bugged me is that anybody who’s been around for any time at all knows that this is what’s happening, and that it’s working against the company or agency, and therefore against the people involved, yet it goes on year after year. And still we have the gull to call ourselves an intelligent species.

    • gelbstoff says:
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      Well summarized. I may add that accountant tend to equate spending with project progress – a ridiculous notion in a research environment.
      G.