Under the American Recovery and Reinvestment Act of 2009 (Recovery Act), the Department of Energy (Department) awarded a $1 billion cooperative agreement to the FutureGen Industrial Alliance (Alliance) for the FutureGen 2.0 Project (Project). The Project was intended to create the world’s first near-zero emissions, commercial-scale, coal-fueled power plant. As of March 2015, the Department had expended more than $180 million for the Project.
OIG received a complaint alleging that a Project subrecipient had misused funds in excess of $10 million. Specifically, the complainant alleged the subrecipient (1) directed employees to mischarge labor to the Project without producing work, (2) spent funds during a period when it was known that there could be no beneficial work performed, (3) improperly billed for labor expenses, and (4) inflated overhead expenditures. OIG was unable to substantiate the first two allegations.