Internal investigators say a contractor picked by the National Science Foundation to run a national ecological monitoring study has been wrongly spending millions in government funds, charging that taxpayer dollars may have been wasted on items that included a $25,000 Christmas party, booze for company executives and a nearly $1,000 a month coffee service.
"The NSF is out of touch and out of control," said Rep. Lamar Smith (R-TX), who will chair the hearing of the House Science Committee.
"Federal agencies must be held accountable for their waste and misuse of taxpayers’ hard-earned dollars," Smith added.
A report issued just before Thanksgiving by the Inspector General at the National Science Foundation raised questions about over $150 million in spending by the National Ecological Observatory Network (NEON), which is funded entirely by the NSF.
Investigators were so alarmed by their initial findings that they "contracted an accounting system audit," to dig more deeply into the spending of NEON, which is helping to build a network of towers around the U.S. to study climate change, all funded by NSF.
The details of the audit reinforced the concerns of the Inspector General, as it showed that NEON was using "management fees" from the National Science Foundation to pay for items that investigators say should not be covered by Uncle Sam.
Among the "normally unallowable costs" the government says were billed to taxpayers by NEON between late 2012 and mid 2013:
+ $25,000 for a Christmas party
+ $11,000 for coffee services for employees
+ $3,000 for Board of Director dinners (which included alcohol)
+ $3,000 for t-shirts and other apparel for Contractor employees
+ $83,000 for “business development”
+ $112,000 for lobbying"
You can read the memo here from NSF Inspector General's office.
In reviewing the funding agreement between NSF and NEON, investigators found that it provided for a flat "management fee" to be paid, which then allows the contractor to get around the usual restrictions on how federal dollars can be spent.
"Given the present lack of controls, there is virtually no accountability over the contingency funds, either at the expenditure phase or at the estimating phase," the IG's office wrote about NEON's use of federal dollars.
In an email, officials at the company denied that taxpayer dollars had been wrongly spent.
"NEON, Inc. has always spent all funding in strict compliance with our understanding both of the guidelines provided to the organization and the law," said NEON Board Chairman Jim Collins in a statement.
"We will be and have been responsive to requests for information."
What exactly is NEON? This is a video the company has on its website:
The House Science Committee describes the non-profit this way:
"NEON is a continental-scale ecological observation facility with 62 planned sites across the United States sponsored by the National Science Foundation to gather and synthesize data on the impacts of climate change, land use change and invasive species on natural resources and biodiversity over 30 years. NEON is the largest National Science Foundation Major Research Equipment and Facilities Construction (MREFC) project in its FY2015 budget request of $96 million."
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