Department of Energy report reveals PPPL overpaid employees by $1.8 million

Following a Department of Energy report last week that revealed that four Princeton Plasma Physics Laboratory employees had been unreasonably overpaid by at least $1.8 million, the University has agreed to reimburse the DOE $1 million to avert further controversy. The DOE oversees the plasma science and fusion lab.

An audit by the DOE’s Inspector General Gregory Friedman found that the PPPL had issued per-diem payments such as lodging subsidies and “field service premiums” to employees traveling on extended assignments to other labs that began between five and 14 years ago. But long after these PPPL employees had permanently moved to the area and the assignments were no longer “temporary,” the report showed that these employees were still collecting the per-diem payments from the PPPL.

The longest assignment of the employees — 14 years at General Atomics in San Diego — cost the DOE $600,000 in per-diem payments; a nine-year assignment for a PPPL worker in San Diego cost taxpayers about $400,000. Another employee received over $400,000 in lodging reimbursements while working at Massachusetts Institute of Technology since 2002 and the fourth employee has received over $95,000 in lodging reimbursements at Oak Ridge National Laboratory in Tennessee. The report did not name the employees.

All employees also received a 12 percent “field service premium,” a bonus given to employees to compensate for the disruption of having to work far from their base lab.

Jen Stutsman, a spokesperson for the DOE, explained in an email that a 14-year-old department policy allowed the overpayments to continue almost indefinitely.

“A policy set in 1998 by the department’s Princeton site office unfortunately created a situation where what were supposed to be temporary assignments could be repeatedly extended without any time limits, making the costs to the government much higher than they should have been,” she said. “When the Inspector General alerted us to this situation, we took swift action to stop the reimbursements for these four individuals and ensure that this would not happen again.”

University Vice President and Secretary Robert Durkee ’69 said that the yearly approval of these extended contracts and the reimbursement amounts were consistent with both University and DOE policies at the time the Inspector General issued his report.

According to Durkee, the payments began in 1998 when the PPPL sent some of its senior scientists on one-year contracts to work at other major fusion sites off-campus. The Princeton lab wanted its employees to work full-time at these other labs while maintaining their ties to PPPL to facilitate collaboration between labs and to provide the University with information on the research at other labs.

The contracts were renewed every year, leading to the 14-, 10-, 9- and 5-year contracts noted in the Inspector General's report.

“It was always with the idea that this year when we review [the contracts], we may decide that we’ve achieved all the benefits we’re going to achieve from this program — now it’s time to come back,” Durkee said. “The program has been in place for 14 years. It was periodically reviewed; it was included in periodic audits,” he added.

Although Durkee said that the payments were not in violation of existing University or DOE policies, Friedman noted in his report that the University was required by contract to claim only costs “that are reasonable, allocable and allowable.”

“While existing laboratory policy permitted temporary assignments, the duration of these particular assignments appeared to be excessive and inconsistent with department policies that we used for benchmarking policies,” Friedman said.

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In particular, Friedman noted established DOE policies that limit per-diem payments for lodging to employees on extended assignments to 55 percent of the normal allowance for temporary lodging at the location. These payments are typically limited to two years.

Friedman noted that no such policy existed for Princeton — Princeton’s lodging per diem was the maximum 100 percent of the normal temporary duty lodging allowance.

“Neither Princeton nor the department’s Princeton Site Office had taken what we would consider to be appropriate action to protect taxpayer interests by controlling the costs of these extended assignments,” the report read.

Since the report’s release on May 17, the University has revised its policy to limit temporary assignment payments to three years and lodging per diems to 55 percent of the normal temporary duty lodging allowance.

“We understand that while this is fully in compliance with the rules at the time, it probably could’ve been done for less. Going forward it will be done for less,” Durkee said.

The DOE will also be changing in response to the overpayment. Stutsman said that the DOE had also revised its policy to prevent reimbursements for extended assignments beyond three years. The new DOE policy will also require a review of those extended assignments to ensure that taxpayers are getting the value they are expected, Stutsman explained.

In response to the Inspector General report, the University announced Monday that it would reimburse the DOE $1 million. Stutsman labeled the agreement “a show of good faith.”

While Durkee said that the University had not done anything wrong, he said he recognized that the length and degree of reimbursements for these four employees was questionable.

“We were willing to reimburse the $1 million so we could move forward instead of continuing to talk about what was done in the past, and I think the department appreciated that,” Durkee said.

Durkee said that the four workers will remain PPPL employees but will not continue to receive per-diem allowances in compliance with the new policy.

“I think the feeling of people who manage the lab and even people at the Department of Energy who oversee the program is that these particular individuals have done excellent work at these locations and there is benefit in having someone who is on the Princeton Plasma Physics Lab working at all these other sites,” Durkee said.

The PPPL works with other labs to develop fusion as an energy source and conducts research related to plasma science and technology. According to its website, it has received $86 million in funding for this fiscal year as of Feb. 1.