Thursday, May 29, 2003 | 11:06 a.m.
Officials from Nevada counties said they disagree with a new audit that questions how they spent $3.3 million of federal oversight funds for the Yucca Mountain nuclear waste repository project.
The audit said Clark, Nye and Lincoln counties spent the funds to hire lobbyists and attorneys unrelated to project oversight, sponsored events and rallies in protest of the repository and bought supplies and services unrelated to Yucca Mountain.
The Department of Energy's Inspector General's Office released the audit Wednesday.
The inspector general tracked a total of $12 million in 2001 and 2002 given to three of 10 local governments for oversight of the federal government's proposed high-level nuclear waste repository at Yucca Mountain.
The amounts in question total $132,296 in expenses for Clark County, $1.1 million for Lincoln and $2 million for Nye.
Margaret Chu, DOE's national nuclear waste program director, said the agency plans to either recover the funds or deduct funds from future grants and monitor future county spending.
Inspector General Gregory Friedman said Wednesday that the federal money should have been used by the counties to review Yucca Mountain's impact on local economies, public health and safety and the environment.
Other valid uses of the money can include covering requests for assistance for project impact studies and provision of information to Nevada residents and Energy Secretary Spencer Abraham on project activities as well as monitoring, testing or evaluation of the Energy Department's scientific program.
But the audit indicated that not all of the money was being used for those purposes.
"Overall, the audit findings suggest that this program is not fully achieving its intended results of assisting local governments in providing oversight of the Yucca Mountain project," Friedman said.
The audit also faulted the Energy Department for failing to monitor county work on the project.
The DOE funds the counties based on plans for the project drawn up by local government officials.
Irene Navis, Clark County Nuclear Waste Division director, said the county could account for the concerns in the report.
"We are going to respond. We disagree with the findings," Navis said.
For example, the audit said that Clark County hired a law firm for $10,000 to research legal impacts from shipping nuclear waste through Nevada. Instead, the attorneys reported on how to challenge and attack the DOE's environmental impact statement, Friedman said.
Navis said that the county hired a Phoenix firm with expertise in environmental impacts to examine the county's list of concerns about nuclear waste transport.
"We hired them to keep us out of trouble," she said.
As for lobby activities, Navis said former Clark County Commissioner Dario Herrera and current commission Chairwoman Mary Kincaid Chauncey had both visited congressional offices in Washington D.C.
"That's just introducing the county policy perspective firsthand," Navis said.
DOE and Clark County officials have already met and are starting to resolve the issues, the audit said.
A Lincoln County consulting firm received reimbursements for research associated with lawsuits filed against the Yucca Mountain project, the audit said.
In Lincoln County a consultant hired to work on computer programs related to Yucca performed work for the district attorney's office and the grants administration office.
Lincoln County consultants also were paid from the nuclear waste funds for economic development, a local hospital assessment and community development unrelated to the repository, the audit said.
Lincoln officials also hired a consultant for $82,496 to help develop land for a master-planned community, the audit said.
Lincoln officials also transferred $15,000 of oversight funds to the county's Regional Development Authority, the audit said.
Lincoln County Commission Chairman Spencer Hafen was not immediately available for comment.
Lincoln County resident Louis Benezet said the audit should be a wake-up call to county officials.
"Percentage-wise, Lincoln County was high on the list for expenditures," said Benezet, who opposes the repository.
Nye County consultants helping to develop a community protection plan in case the repository is built also lobbied to fund a research and development center, tried to change a section of the Nuclear Waste Policy Act and transferred federal land for other projects.
Nye County Commission Chairman Henry Neth said that the inspector general and local officials interpret financial reports differently.
"The bottom line is, there is no waste and no fraud," Neth said. "It's just a difference in interpretation by the county and the inspector general. We are preparing a response."
The audit also said that the counties kept interest earned from the nuclear waste funds, which should have been returned to the fund.
Clark County has nearly $1.6 million in interest earned on nuclear waste funds as of August 2002, the audit said. Over the past 11 years, Southern Nevada has a total cash balance from the fund of $4.6 million.
Lincoln County had $370,000 on hand, including $35,000 in interest and Nye County had $1.5 million with $141,7000 in interest.
Sens. Harry Reid, D-Nev., and John Ensign, R-Nev., said they had not had time to review the audit. They said they learned about it before a field hearing in Las Vegas Wednesday on scientific quality issues at Yucca Mountain.
The recent audit is similar to three others, two performed by the General Accounting Office in 1990 and 1996 and an independent audit of Nye County in 2001.
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