NASA IG Faults NASA for Excluding JPL, Grants, from Improper Payments Scrutiny

NASA’s Office of Inspector General (OIG) issued a report today criticizing how NASA implements a law intended to discover improper payments by the government.  Among its complaints, the OIG faulted the agency for excluding payments to the Jet Propulsion Laboratory (JPL) and grants from its improper payments analysis.

JPL is a federally-funded research and development center operated for NASA by the California Institute of Technology (CalTech).   Many consider it to be one of NASA’s field centers, but in fact it is a contractor.  The OIG report said that NASA paid JPL $1.6 billion in FY2010, but NASA excluded it from a review required by the 2002 Improper Payments Information Act (IPIA) because the agency believed payments to JPL “are not at risk [for improper payments] and that payments made by JPL to its subcontractors are not subject to IPIA.” 

NASA also excluded the approximately $3 billion it awarded as grants from FY2006-FY2010 from its testing methodology for improper payments.    The OIG report said NASA made that decision because “prior results … indicated testing of first-line grant payments was not cost-effective…” and the Office of Management and Budget (OMB) did not provide sufficient guidance on “how to conduct testing beyond the primary recipient.”  NASA’s OIG disagreed, noting that other agencies do include grants in their testing, and by excluding them, NASA was omitting programs that the OIG “previously identified as having internal control weaknesses.”

The OIG make nine recommendations to NASA’s Chief Financial Officer (CFO) on how to improve its activities regarding implementation of IPIA and the CFO agreed with six of them.  The CFO, Beth Robinson, agreed to include grants and to include JPL.  However, she did not agree to include payments made by JPL to subcontractors.  The OIG disagreed with her position on that issue and called it “unresolved.”

The report is not about whether there actually were improper payments or not.  It only addresses NASA’s implementation of the law.