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BPA Investigation finds Hiring Violations, Retaliation and Bad Management by Ted Sickinger The Oregonian, October 8, 2014

Ratepayers will Pay for Fix

The U.S. Department of Energy's inspector general issued a blistering report Tuesday that detailed Bonneville Power Administration's discriminatory hiring practices and the management culture that investigators say allowed the practices to take root and persist even after they were brought to light.

The long-awaited report concluded that the Portland-based power marketing agency consistently manipulated applicant rankings between 2010 and 2012, that it failed to disclose inappropriate hiring practices that discriminated against veterans and other applicants, and that it did not initiate corrective actions to remedy the problems.

Those actions will cost ratepayers at least $3 million just to identify the scope of the problem and design corrective actions -- and likely far more to actually remedy them.

Many of the findings in the report were consistent with those in the management alert that the DOE Inspector General issued in mid July. Since then, the Department of Energy and U.S. Office of Personnel Management have issued separate audits critical of BPA's hiring practices. While different in tone and substance, those audits touched on many of the same themes.

What was different about Tuesday's report -- and many observers in the region say it reflects DOE's long-standing desire to re-establish firm operational control over BPA -- was its indictment of BPA's management team and their role in creating and sustaining prohibited personnel practices.

The report said BPA's practice of deflecting oversight by the Department of Energy was baked into its culture and that agency officials spent considerable effort to distance themselves from DOE procedures and processes that they considered an unnecessary administrative burden. BPA's reluctance to seek any external advice on policy matters, the report said, "reflected a level of hubris that appears to be the underlying cause of the current crisis."

Operationally, the report said management exercised inadequate oversight over personnel and recruitment functions, failed to ensure adequate human resources training, relied on informal, undocumented practices, and failed to follow though on established accountability safeguards such as quarterly audits.

It went on to say that Bonneville's management team tolerated, or failed to address, a culture of intimidation and mistrust in the human resources operation. Employees reported that they were compelled to take actions they didn't agree with or face retaliation. Performance reviews were used to force conformity from staff.

The IG said its investigation turned up numerous instances where adverse personnel actions were instituted against whistleblowers. BPA tried to fire the two employees who were primarily responsible for bringing its manipulation of applicant rankings to the attention of investigators, the report said. The IG suspended those actions and others.

The report did not mention by name BPA Administrator Bill Drummond or Chief Operating Officer Anita Decker. Both were suspended in July after the IG's office received "credible" allegations of retaliation against whistleblowers, and a BPA spokesman said Tuesday that their status remains unchanged.

However, the report did refer to the involvement of a "senior executive" in discussions of disciplinary actions against an employee who was instrumental in bringing the human resources problems to light. The senior executive avoided a request from the employee in question to discuss concerns and ignored advice from a manager that they consider going slow on the disciplinary action because of the possible optics of removing a whistleblower. The executive decided not to intervene in their firing because they believed the removal was justified for performance reasons. The request to remove the employee was signed by different executive, Roy Fox the director of BPA's human resources operation, on the day he retired.

The IG said many of the factors cited were clearly trivial and classified the removal as retaliation.

The report also indirectly referred to statements that Decker made during congressional hearings in August. Decker told members of the House Committee on Oversight and Government Reform that while the agency had made mistakes in hiring, managers were acting on internal policy advice that their manipulation of applicant rankings was acceptable under federal rules. She also said members of her family were veterans and that she would never knowingly do anything that discriminated against them.

The report said statements to that effect were not credible:

"The widespread and pervasive practice of manipulating the candidate rating process did precisely that ... It strains credulity to believe that HCM staff and Bonneville's management chain failed to recognize that veterans were being treated unfairly. We found Bonneville's insensitivity in these matters to be disturbing."

BPA issued a statement attributed to Acting Administrator Elliot Mainzer: "The findings in the Department of Energy Inspector General's report are deeply troubling to all of us at BPA. The Department and BPA are fully committed to addressing the problems with our human capital management program and providing recourse to the many individuals, including veterans, who were impacted by our flawed hiring practices. I also want to reiterate my commitment to a workplace free of retaliation.

Discriminating against veterans and retaliating against whistleblowers appears to have put Bonneville in the too-hot-to-handle basket for the Northwest's congressional delegation. The delegation typically intervenes when the DOE or members of Congress from outside the region undermine BPA's autonomy or interfere with its mission of serving regional, rather than national needs.

But both Washington and Oregon's lawmakers have been silent aside from statements condemning BPA's dysfunction.

Sen. Ron Wyden, D-Ore. and chair of the Senate energy committee, issued a statement Tuesday: "The Inspector General report confirms that Bonneville repeatedly and systematically violated federal rules giving hiring preference to veterans. Veterans were treated inappropriately in at least 117 cases between November 2010 to June 2012. This is simply unacceptable."

Randy Hardy, an energy consultant and former BPA Administrator, contends the Northwest delegation needs to get over BPA's political toxicity and look after the region's interests before DOE control migrates into policy issues affecting ratepayers.

He says DOE has been itching to regain control ever since many of BPA's statutory authorities were delegated from the DOE in the mid-90s. He said Bonneville's personnel mistakes -- egregious, though solvable -- provided the golden opportunity to wrest that control back to Washington, D.C., and turn BPA into a typical federal bureaucracy rather than an autonomous utility serving Northwest interests, he said.

"That's the way this thing is going and will continue to go until someone on the delegation stands up and says this is enough," Hardy said.

BPA sells power to 140 public utilities in the region. And customer groups are already worried about the cost of resolving the crisis.

The IG's investigation touched on those costs. It said the immediate costs for identifying the extent of the problem and designing corrective actions will likely exceed $3 million. That doesn't include the cost of the independent personnel system -- up to $16 million -- that Bonneville insisted it needed in place of the platform that DOE offered and was being used by its 17 other human resources offices at significantly lower cost. It also doesn't include the actual costs needed to remedy the erroneous appointments and discriminatory practices.

Those could be significant. Bonneville's preliminary review identified over 30 veterans who lost employment consideration because of its ranking manipulations. Changes to the scoring schemes also resulted in at least 20 erroneous appointments. BPA's files are incomplete and inaccurate, the report said. Final determinations will require reconstruction of at least 1,200 promotion and hiring case files representing approximately 22,000 applicants.

According to federal rules, illegal hires must be removed. And BPA is reportedly going to be offering jobs not just to top candidates who were discriminated against, but everyone who was affected by the manipulated rankings.

"We need to make sure that if hiring practices are broken, they're fixed in a way that doesn't create unduly costly results," said Scott Corwin, executive director of the Public Power Council, which represents BPA's public utility customers. "This is a key agency in the region, and it still needs to run efficiently."

Related Pages:
Energy Department Ousts 2 Top Officials of Bonneville Power Administration by Steven Mufson, Washington Post, 7/16/13
Hydro BiOp At Half-Way Point; Agencies Report on Progress by Bill Rudolph, NW Fishletter, 7/18/13
DOE Appoints Elliot Mainzer Interim Leader of BPA; Bill Drummond's Fate Unclear by Ted Sickinger, The Oregonian, 7/15/13
New Leader Appointed to Bonneville Power Administration by Staff, Statesman Journal, 1/27/14
Doc Hastings to Retire from Congress by Abby Livingston, Roll Call, 2/13/14

Jeff Stier, Senior Policy Advisor at BPA by Jeff Stier, LinkedIn.com, 3/14
bluefish surreptitiously attends a Oregon Trail Electric Cooperative meeting and poses two questions, Answered by Steve Wright, 3/29/11