Energy Dept. watchdog warns of ‘appearance of favoritism’ in loan program hiring

But the report could invite new criticism of the office that supports green energy companies, which has already faced strong GOP attacks over the collapse of the solar company Solyndra.

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According to the IG report, the unnamed loan program official acknowledged a “longstanding personal relationship” with an applicant but said the person’s hiring was based on merit. The IG agreed the person was qualified for the job.

The official also said another person had been hired for a similar position at the same time and that “full consideration was given to all applicants,” the report notes.

From the report:

The senior official pointed out, and we verified, that both of the individuals selected possessed the basic qualifications for the position as specified in the vacancy announcement and had been properly referred for consideration by human resources officials.

The report says the “circumstances” surrounding the hiring of the friend “may” have been influenced by the prior relationship. But the IG could not tell whether other qualified applicants were fully considered because no candidate evaluation records exist for the hiring.

Separately, the report does not find evidence to support an allegation that the loan program official directed a contractor to hire specific applicants. Under DOE guidelines, federal employees “generally” should not be involved in contractor personnel decisions, the report notes.

It does find that the official “actively forwarded resumes or referred names” of 10 people to a contractor, and they were all hired. But the report notes that “the contractor informed us that each applicant was competitively screened” and that the contractor did not feel pressure to hire the people.

The IG credits the Energy Department's loan office with taking steps to strengthen its hiring process, such as creating interview panels and limiting hiring power to a “select few” managers, excluding the official the report is about.

“In keeping with the public trust, the department is committed to a hiring process that is fair, transparent and based completely on the merits of the applicants,” a DOE official told The Hill.

But the report also recommends that the loan office improve training on hiring practices and “Determine whether the senior [Loan Programs Office] official violated the standards of ethical conduct or engaged in irregular hiring practices and take necessary action.”

Republicans have for years bashed the loan program because of Solyndra and a few other DOE-backed companies that sputtered or failed.

But defenders, including Energy Secretary Ernest Moniz, note that those failures represent a very small percentage of the green energy loan portfolio, and say that overall the program has been a success.

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