The Department of Energy‘s three loan programs have made over $30 billion in loans and loan guarantees in support of renewable or innovative energy technologies, but it needs to fully develop its loan monitoring function, the department’s IG told a House Energy and Commerce panel recently.
It said the department has not fully developed or consistently adhered to loan monitoring policies for its loan programs.
For example, policies for some activities such as evaluating and mitigating program-wide risk remain incomplete or outdated, and in some cases DoE did not adhere to policy requiring it to evaluate the effectiveness of its loan monitoring, according to GAO’s testimony, GAO-14-645T.
It said the department did not consistently adhere to policies because the Loan Programs Office was still developing its organizational structure, including its staffing, management and reporting software, and procedures for implementing policies. As a result from 2009 – 2013 it was making loans and disbursing funds during a period of significant program events (including five borrower defaults) without a fully developed loan monitoring function.
Energy generally agreed with recommendations to fully develop its loan monitoring function by evaluating loan monitoring effectiveness, staffing key positions, updating management and reporting software, and completing policies and procedures for loan monitoring.
