Feds auditing LG Chem grant usage

HOLLAND, Mich. (WOOD) - A Target 8 report on LG Chem has led to a federal audit of the Holland plant -- and to a big change on how some of the plant's workers are spending their days.

The U.S. Department of Energy confirmed Tuesday that it has initiated an audit into how the plant is spending $151 million in federal funds.

The audit follows an October Target 8 investigation that found some workers, with little else to do, were spending hours playing cards and board games or watching movies on company time. Others had convinced management to let them spend their days working for area non-profits, also on the company's dime.

Federal officials said the Target 8 investigation's findings raised questions about how LG Chem was spending the DOE grant that was key to building the plant.

The plant started with great hope and a presidential groundbreaking in July 2010, with plans to produce lithium-ion battery cells for the Chevrolet Volt. But Volt sales have been a disappointment, and the plant hasn't produced a single cell for sale.

The Korean-based company has claimed that as many as 100 of its employees are paid for with those federal grant dollars.

Two sources in the plant say the DOE showed up in early November, interviewing some workers and checking paperwork, including time slips.

The auditor questioned them about how they're spending their time, including their work for the non-profits. The sources say the company in early November ordered an end to that non-profit work.

Some agencies who got the much-needed help, including the Critter Barn in Zeeland, were disappointed.

"I do feel elated for what they could do, blessed that they could come to our farm and sad that they had to be pulled out early before they could see the completion of some of the projects," said Mary Rottschafer of Critter Barn. "There's repairs, painting, new lunch room, things that we even would have never dreamed of doing that were accomplished through their volunteer work."

Workers, she said, are not to blame for spending their time outside the plant.

"For the employees who still haven't got enough work to do, they're bored, their morale is down, they're frustrated with their situation; they were very hopeful," said Rottschafer.

A DOE spokeswoman cautioned calling thee audit an investigation, saying "it's not criminal at this point." She said she doesn't know how long the audit will take.

LG Chem officials did not respond Tuesday to a request for comment.