Hiring practices by a Department of Energy division put veterans and other applicants at a disadvantage and penalized whistleblowers, according to a report by the department's inspector general.

“There was a massive breakdown in procedures, processes and management attentiveness at several levels of Bonneville's operation,” the report said. The report is a follow-up to a management alert that was released in July.

The Bonneville Power Administration, a division of the DOE that markets power generated by federally owned hydroelectricity projects in the Northwest, ignored federal requirements that veterans receive preferential treatment in at least 117 cases.

The human resources mismanagement will likely cost more than $3 million to fix, which will be passed on to Bonneville's ratepayers, according to the inspector general.

In one case, a hiring official closed and reopened a vacancy with stricter qualifications to avoid hiring a veteran. A staff attorney for Bonneville provided advice on these modifications, which “appeared to target the particular veteran," the IG said.

“The case highlighted here may reflect a more extensive problem,” the report said. “Bonneville misused overly restrictive qualifications to improperly eliminate qualified applicants.”

Employees who reported Bonneville's practices or cooperated in the IG’s investigation faced retaliation, including suspension or firing.

In one instance, an employee was let go despite orders from the DOE’s deputy secretary not to retaliate against whistleblowers.

“The impact of Bonneville’s improper hiring practices is widespread,” and “has exposed the DOE to a variety of legal challenges,” the IG report said.

The energy department ignored "obvious early warning signs," didn't ensure that Bonneville officials implemented corrections required by a 2010 audit, and didn't act when they failed to submit mandatory self-audits.

Bonneville officials also sent case files by hard copy, rather than electronic files, which the IG said were intentionally manipulated by the division.

“Clearly, more aggressive actions on the department's part could have aided in preventing, or at least detecting and remediating these problems at Bonneville,” the report said.

Read the full report here.