Nevada delegation seeking answers on DOE payments

Friday, May 22, 1998 | 9:54 a.m.

The U.S. Department of Energy, facing a three-day holiday, had not responded Thursday to concerned letters from members of Nevada's congressional delegation about the DOE paying discrimination settlements for contractors with tax dollars.

Sens. Harry Reid and Richard Bryan, both D-Nev., urged Energy Secretary Federico Pena to investigate using taxpayer dollars to cover the costs of discrimination suits against former Nevada Test Site contractors.

Bechtel Nevada now manages the Test Site, but Reid said he is concerned that the practice continues. He sits on the Senate Appropriations Committee and the energy subcommittee. "I am concerned that this practice from the past might still be operable today, and not just in Nevada," Reid wrote.

Bryan urged Pena to evaluate and explain the issues raised by local attorney Janet Pancoast. "I would seriously question the justification of the payment of such costs by the department as normal business expense," he wrote.

Of the $1.1 million total settlements paid since 1992, former contractors Raytheon and Reynolds Electrical Engineering Co. received most of the compensation.

DOE's Nevada Operations Office spokesman Darwin Morgan said paying discrimination settlements with tax dollars is allowed by standard federal regulations and the DOE's own rules.

In order for contractors to protect themselves from discrimination charges, they either insure themselves or come under the DOE's system, Morgan said.

Las Vegas attorney John Thorndal, who has represented the DOE and its contractors in various suits over the years, said he cannot recall defending any other federal contractor in a discrimination suit.

But Thorndal said if the taxpayer didn't pay for settlements and legal expenses, then the DOE would have to pay the contractors more money to defend themselves. Legal costs could skyrocket.

Pancoast discovered the DOE's practices and documented her complaint under a Freedom of Information Act request. She sent a letter to Pena last week, demanding the taxpayers be reimbursed and the practice be stopped.

"As a taxpayer, I find this practice outrageous," she wrote. "As an American, I find it revolting."

Pancoast said she believes it is a nationwide practice by the DOE and allows contractors to "discriminate with impunity."

As of Thursday afternoon, Pancoast said she had not heard from the DOE about her complaint.

Meanwhile, Rep. John Ensign, R-Nev., called the practice "very disturbing." He wrote a letter to Rep. Thomas Bliley Jr., R-Va., House Commerce Committee chairman, asking him to investigate.

If the practice is normal procedure for the DOE, Ensign said he will work to reform it, ensuring Americans are not held financially responsible for employment violations.

Late Thursday Ensign's press secretary Jack Finn said the congressman had not received a reply from Bliley. Congress is leaving for a 10-day Memorial Day recess.