TD194.6
.£627
1988 United States Office of the Inspector General September 1988
Environmental Protection 401 M St, SW
EPA's Office of the
Inspector General
Annual
Superfund Report
to the Congress
for Fiscal 1987
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FOREWORD
This is our first Annual Superfund Report to the Congress, covering fiscal 1987 activities. The
Superfund Amendments and Reauthorization Act of 1986 requires the Office of Inspector General to
annually audit the Superfund program and to provide an annual report to Congress on these required
audits. We intend to expedite our annual Trust Fund audit in future years so that this report may be
issued earlier.
The advent of the Superfund program created new and unique cost accounting requirements.
EPA over the past several years has responded to these new requirements by significantly improving its
ability to accurately account for and document Superfund costs. However, we found that the Agency
still needs to take corrective action for fiscal 1987 in the areas of (1) accounting for and controlling
personal property, (2) allocating general support services costs; (3) monitoring letter of credit reports;
and (4) recording accounts receivable.
We concluded that work under the $136.3 million of Superfund cooperative agreements was not
effectively performed by the recipients, or adequately monitored by the Regions. Performance goals
and objectives of the agreements were often not attained. In priority areas, such as remedial
investigation/feasibility studies, work was substantially behind schedule. Similarly, priority preremedial
activities related to preliminary assessments, site inspections, and hazard ranking scores frequently
were not completed in a timely and effective manner. Also, our audits disclosed deficiencies related to
recipients': (i) procurement systems; (ii) accounting systems being inadequate to form a basis for cost
recovery under the Superfund program; (iii) letter of credit activities not meeting requirements; and
(iv) personal property and equipment systems not being properly managed to project Superfund
acquired items. The Agency has taken a number of actions to correct the problems we found in our
cooperative agreement audits.
In addition to reviewing Agency performance, we also take a proactive role assisting EPA
management to prevent future problems. This includes review of draft documents and participation in
EPA work group meetings. Superfund program areas with a particularly high level of OIG proactive
work during fiscal 1987 included the removal program, technical assistance grants to citizens' groups
and cooperative agreements with States.
Our Superfund resources have not kept pace with the increasing size and complexity of the
program and the new mandatory requirements imposed upon us by SARA. We have had to defer
audit coverage of many significant aspects of EPA management of Superfund in order to fulfill
statutory requirements and provide audit support for burgeoning Superfund procurement. Superfund
is particularly sensitive to fraud, waste and abuse, requiring a substantial investment in training and the
development of new audit and investigative approaches.
We will continue to assist Agency management to deliver the most effective and efficient
Superfund program through a comprehensive program of audits, investigations and fraud prevention.
U.S. Environmental Protection Agency £\ C -
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TABLE OF CONTENTS
Eaga
Purpose 1
Background 3
Hazardous Substance Superfund 5
Response Claims 12
Cooperative Agreements 14
Other Internal and Management Audits 24
Financial and Compliance Audits 30
Assistance to EPA Management 32
OIG Superfund Resources 34
Exhibit I - Hazardous Substance Superfund
Schedule of Obligations 37
Exhibit II - Hazardous Substance Superfund
Schedule of Disbursements 41
Exhibit III - Matrix of Cooperative Agreement
Audit Reports Reviewed and
Deficiencies Noted 44
Exhibit IV - OIG Superfund FTE's as a
Percentage of EPA 46
Exhibit V - Superfund Audit Reports Issued
During Fiscal 1987 47
Appendix A - Acronyms and Abbreviations 52
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PURPOSE
This report is provided pursuant to section lll(k) of the Comprehensive
Environmental Response, Compensation, and Liability Act (CERCLA) of 1980, as
amended. The Superfund Amendments and Reauthorization Act (SARA) of 1986
amended that section of CERCLA to add several annual requirements for the
Inspector General of each Federal agency carrying out CERCLA authorities. These
requirements include four audit areas and an annual report to Congress regarding
the required audit work. This report covers fiscal 1987 audits of Superfund
activities. The required four audit areas are discussed below.
This report contains a chapter on three of the four mandated areas where we
performed reviews. In addition, we are summarizing other Superfund audit work
and assistance to EPA management which we performed during fiscal 1987. In
addition to fulfilling the statutory requirements, the objectives of this report include
providing the Congress with significant results of all of our Superfund audit work
and a better understanding of how the Office of Inspector General is carrying out its
purposes with respect to the Superfund program.
Trust Fund
CERCLA requires"... an annual audit of all payments, obligations,
reimbursements, or other uses of the Fund in the prior fiscal year " We call this
our Trust Fund audit and it constitutes a financial and compliance audit of EPA
obligations and disbursements from the Hazardous Substance Superfund during the
fiscal year.
Claims
CERCLA requires an annual audit to assure"... that claims are being
appropriately and expeditiously considered " Since SARA did not include
natural resource damage claims as allowable Fund expenditures, the only claims
provided in CERCLA, as amended, are response claims and indemnity claims from
response action contractors. No claims were submitted during fiscal 1987. In future
years, we will audit claims which are of sufficient size to be considered material. We
initiated a survey of the claims preauthorization process in fiscal 1987.
Cooperative Agreements
CERCLA requires audits"... of a sample of agreements with States (in
accordance with the provisions of the Single Audit Act) carrying out response
actions under this title ...." We perform financial and compliance audits of
cooperative agreements with States. In some instances, our audits also review
program performance. In addition, we sometimes review EPA regional
management of the cooperative agreement program. Because we have issued a
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"capping report" summarizing the results of all such audits in fiscal 1985,1986 and
1987, this year's report covers three years of audits instead of just one. In future
reports, we will summarize audit reports in this area issued during the prior fiscal
year.
Remedial Investigations/Feasibility Studies (RI/FS)
CERCLA requires our"... examination of remedial investigations and
feasibility studies prepared for remedial actions " Our RI/FS examinations will
provide a technical review of the adequacy of the studies to provide a sound
technical basis for remedial action decisions. These examinations may be done as
part of audits of EPA management or as special reviews by our technical staff. At
the time SARA was enacted, we had not performed any such examinations and our
available technical resources for this purpose were limited. We did not issue any
reports to EPA management on RI/FS examinations during fiscal 1987. However,
we did initiate several such examinations as components of broader management
audits. These reports were completed in fiscal 1988, and will be included in our
fiscal 1988 Superfund annual report.
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BACKGROUND
The "Superfund" program was established by the Comprehensive
Environmental Response, Compensation, and Liability Act of 1980 (CERCLA),
Public Law 96-510, enacted on December 11,1980. The Superfund program was
created to protect public health and the environment from release, or threat of
release, of hazardous substances from abandoned hazardous waste sites and other
sources where response was not required by other Federal laws. A Trust Fund was
established by CERCLA to provide funding for responses ranging from control of
emergency situations to permanent remedies at uncontrolled sites. CERCLA
authorized a $1.6 billion program financed by a five-year environmental tax on
industry and some general revenues. CERCLA requires that response, or payment
for response, be sought from those responsible for the problem, including property
owners, generators, and transporters.
CERCLA was revised and expanded by the Superfund Amendments and
Reauthorization Act of 1986 (SARA), Public Law 99-499, enacted October 17,
1986. SARA reinstituted the environmental tax and expanded the taxing
mechanism available for a five-year period. It authorized an $8.5 billion program for
the 1987-1991 period. The Trust Fund was renamed the Hazardous Substance
Superfund.
The basic regulatory blueprint for the Superfund program is the National Oil
and Hazardous Substances Contingency Plan (NCP), 40 CFR Part 300. The NCP
was first published in 1968 as part of the Federal Water Pollution Control Plan, and
has been substantially revised to meet CERCLA requirements. The NCP lays out
two broad categories of response: removals and remedial response. Removals are
relatively short-term responses and modify an earlier program under the Clean
Water Act. Remedial response is long-term planning and action to provide
permanent remedies for serious abandoned or uncontrolled hazardous waste sites.
CERCLA recognized that the Federal Government can only assume
responsibility for remedial response at a limited number of sites representing the
greatest public threat. Therefore, EPA must maintain a National Priorities List
(NPL), which must be updated at least annually. The NPL is composed primarily of
sites which have been ranked on the basis of a standard scoring system, which
evaluates their potential threat to public health. In addition, each State was allowed
to designate its highest priority site, without regard to the ranking system.
CERCLA section 104(c)(3) provides that no remedial actions shall be taken
unless the State in which the release occurs enters into a contract or cooperative
agreement with EPA to provide certain assurances, including cost sharing. At most
sites, the State must pay 10 percent of the costs of remedial action. Preremedial
activities (preliminary assessments, site inspections), remedial planning (remedial
investigations, feasibility studies, remedial designs), and removals may be funded at
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100 percent by EPA. For facilities operated by a State or political subdivision at the
time of disposal of hazardous substances, the State must pay 50 percent of all
response costs, including removals and remedial planning previously conducted.
CERCLA 104(d)(l) provides that if a State or political subdivision is
determined to have the capability to respond to the issues addressed in the Act, they
may be authorized to respond by use of a contract or cooperative agreement. As a
result, most States have participated in some part of the Superfund program.
CERCLA 104(d)(2) provides a remedy to the Federal Government for failure of a
State or political subdivision to perform satisfactorily.
The use of cooperative agreements is authorized by sections 104(c)(3) and
104(d) of CERCLA. Cooperative agreements allow a State or political subdivision
to take, or to participate in any necessary actions provided under CERCLA, given
that the State or political subdivision possess the necessary skills and capabilities to
do so. These actions are normally addressed in the cooperative agreement as
performance goals and objectives. The agreement is also used to delineate EPA and
State responsibilities for actions to be taken at the site, to obtain required
assurances, and as a commitment of Federal funding. EPA uses the cooperative
agreement as a means of encouraging State participation in Superfund activities such
as the preremedial programs, State management assistance on EPA lead activities,
and State lead sites.
Procedures for managing the cooperative agreements are discussed in the
publications entitled State Participation on the Superfund Remedial Program, and
the Superfund State-Lead Remedial Project Management Handbook. These
publications provide guidance to both the EPA Regional and State staffs in the
cleanup of Superfund remedial projects at NPL sites.
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HAZARDOUS SUBSTANCE SUPERFUND
SCOPE AND OBJECTIVES
We contracted with an independent public accounting (IPA) firm to perform
an audit of EPA's portion of the Hazardous Substance Superfund (Trust Fund) for
the fiscal year ended September 30,1987. This audit included tests of the
accounting records at EPA's 10 regional offices, 3 major laboratory facilities and
Headquarters. The IPA also evaluated the internal accounting controls for
Superfund at those locations and the National Enforcement Investigations Center,
including a review of electronic data processing (EDP) controls; and performed
other auditing procedures that were considered necessary in the circumstances. The
IPA did not analyze program results. Additionally, they reviewed the status of
findings and recommendations included in the prior audit report covering the fiscal
year ended September 30,1986. Contract, grant, and interagency agreement costs
were accepted to the extent valid obligation and disbursement records were
maintained. Audits of contracts, grants, and interagency agreements performed at a
later date may disclose questioned costs.
As part of the audit, the IPA selectively tested (using statistical samples)
transactions which obligated and disbursed funds for Superfund activities. The
objectives of this audit were to determine:
(1) The accuracy and fairness of the Schedule of Obligations and
Schedule of Disbursements in accordance with applicable laws, regulations,
and guidelines;
(2) Compliance with laws, regulations and guidance which, if not
followed, might have a material effect upon the Schedule of Obligations
and the Schedule of Disbursements; and
(3) The adequacy of internal controls to ensure the reliability of applicable
accounting and management records.
It was not within the scope of this audit to determine the allowability and
allocability of the general support services cost pools that were accumulated and
allocated to Superfund or to verify the bases for these allocations. Audit procedures
for cost allocations were limited to reviewing methodologies, testing the
mathematical accuracy, and verifying that the allocations were made in a timely
manner.
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SUMMARY OF FINDINGS
The advent of the Superfund program created new and unique cost
accounting requirements which previously were not necessary. EPA's accounting
system, like those of most government agencies, was geared to account for costs on
an organizational basis. Therefore, EPA needed to enhance its existing accounting
system to provide for job-costing capability. EPA over the past several years has
responded to these new requirements by significantly improving its ability to
accurately account for and document Superfund costs.
In response to a prior audit report, which covered fiscal 1986 financial
transactions, the Agency indicated that corrective action would be taken in the areas
cited in that report. However, the corrective actions described were not scheduled
to take place until after fiscal 1987. The IPA found that the Agency still needs to
take corrective actions for fiscal 1987 in the areas of (1) accounting for and
controlling personal property; (2) allocating general support services costs; (3)
monitoring letter of credit reports; and (4) recording accounts receivable.
FINDINGS
1. FINANCIAL RESULTS OF AUDIT
During fiscal 1987, EPA obligated over $1 billion and disbursed
over $529 million. The IPA questioned and set-aside costs based upon
projections of errors from statistical samples, and this was due primarily
to missing documentation and a lack of written justification that the
expenditures provided a benefit to the Superfund program. In addition,
they questioned costs for general support services improperly
allocated to the Trust Fund. The financial results of this audit are
summarized below and detailed in exhibits I and II.
Total Accepted Questioned*
FY1987 $1,015,497,148 $1,014,501,781 $ 995,367
Obligations
FY1987 $ 529,833,100 $ 528,927,615 $ 905,485
Disbursements
* Questioned costs are costs that are unallowable under the provisions of
applicable laws, regulations, policies, or program guidelines.
The IPA recommended that Agency management review and
resolve the previously provided questioned sample transactions, which
resulted in the projected questioned costs.
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2. ACCOUNTING FOR AND CONTROLLING PERSONAL PROPERTY
EPA needs to improve its accounting for and control over
personal property. The audit disclosed the Superfund interest in the
property was not properly protected since: (i) the amounts recorded for
property were not always accurate; (ii) items were not always recorded in
EPA's management records; (iii) some items could not be located; and
(iv) annual physical inventories were not taken at all locations.
The IPA identified 30 items of personal property, totaling $2.1
million, that were incorrectly recorded in EPA's Personal Property
Accounting System (PPAS). This resulted in an overstatement of
Superfund property. Also, the IPA found breakdowns in the flow of
documentation and problems with entering data into the system. For
example, the documents used by EPA's property accountable officers
(PAO) to record property items in PPAS often were the receiving copies
of purchase requisitions, which did not reflect actual disbursement data.
Therefore, the amounts entered in the property records did not include
adjustments for price changes, freight or discounts. An example of
entering incorrect data in the PPAS was a computer costing $2,097 which
was entered as $2,097,029. As a result, the value of Superfund property
was significantly overstated. In this case, the PAO attempted to correct
the error, but an incorrect code caused the adjustment to be rejected. If
the Agency had policies and procedures requiring the reconciliation of
property purchases in the accounting system with items entered
into the PPAS; this reconciliation would have identified the above types
of errors for timely adjustments by EPA management.
The IPA identified 333 items of personal property that should have
been included in PPAS, but were not. The cost of this property exceeded
$2.5 million. There were various reasons why EPA property purchases
were not recorded in the property records. In some cases, receiving
documents were not sent by contracting offices or custodial officers to
the PAOs when property was ordered or received. For example,
the IPA found that Superfund property valued at $904,954 purchased by
one location for another location had not been recorded in PPAS because
documents were not forwarded to the PAOs.
The IPA also discovered EPA could not locate 72 items of
personal property selected for physical inspection. These items were
valued at $320,153. No complete annual physical inventories or
reconciliations were performed for fiscal 1987 at Headquarters or at
Regions 2,4, 5, 8 and 10. Such physical inventories were required by
Agency directives, and would have identified missing property.
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In their response to the draft audit report, the Agency stated it has
taken or will take action to correct many of the deficiencies cited above.
In the instances where response was not considered adequate, the IPA
recommended corrective action.
The IPA recommended that Agency management:
improve policies and procedures, including a
reconciliation of the property and accounting records,
to ensure that the property records are reliable; and
obtain certifications from Property Accountable Officers
that corrective actions have been taken to correct the
remaining errors and omissions from the PPAS.
3. ALLOCATION OF GENERAL SUPPORT SERVICES COSTS
EPA needs to improve and implement clear and concise
procedures for allocating general support services costs to ensure costs
charged to Superfund represent actual benefits received. The IPA found
that Superfund was overcharged $895,862 for its share of general support
costs.
This was due in part to the Agency's policy for allocating support
costs, which allowed allocations to be used based upon authorized
(budgeted) data. EPA Headquarters allocated general support costs to
Superfund using a combination of both budgeted/authorized full-time
equivalent's (FTE's) and actual Fib's depending on the type of expenses
being allocated. The IPA believes that allocations of all general support
services costs should be based upon actual FTEs to achieve an equitable
allocation. Based upon these calculations, Headquarters use of budgeted
ratios resulted in an over-allocation of general support costs to Superfund
by $760,571. Also, two regions made errors in their calculations of
support services costs to Superfund amounting to $135,291.
In their response to the draft report, the Agency stated that action
to correct the regions' errors in allocating support services costs has been
taken. However, Agency management does not agree that the allocation
should be based only on actual FTE ratios.
The IPA recommended that Agency management:
change the policy to require cost allocations for
general support services to be based on actual FTE
ratios; and
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recalculate general support cost allocations for
Headquarters based on actual FTE ratios and make the
appropriate adjustments to Superfund.
4. MONITORING LETTERS OF CREDIT
EPA needs to strengthen procedures for the monitoring of
letters of credit to ensure that: (1) recipients file Federal Cash
Transactions Reports promptly; (2) recipients do not have excess cash on
hand; and (3) cash drawdowns reported by recipients are reconciled with
the Agency's accounting records. At four of the ten EPA regions, the IPA
found that recipients did not submit Federal Cash Transaction Reports
within the 15-day period as required. Also, the IPA found that two
recipients had excess cash on hand, totaling $235,000. The IPA reviewed
the Federal Cash Transaction Reports to verify that drawdowns as
reported by the recipients reconciled to the EPA's accounting records.
The IPA noted discrepancies in these reconciliations at two regions,
amounting to $625,816.
The IPA reviewed the filing dates on recipients' Cash Transaction
Reports to determine if they were filed within 15 working days after the
end of the calendar quarter. Since these reports are necessary for the
reconciliation process, the 15-day requirement helps ensure that
discrepancies will be discovered in a timely manner and that immediate
corrective action can be taken. They found that 35 of 55 reports tested
(64 percent) for these four regions were filed an average of 6 to 36 days
late. This means that any descrepancies or excess cash on hand would not
be corrected in a timely manner.
The review of these reports revealed excess cash on hand for two
recipients of letters of credit, totaling $235,000, as of September 30,1987.
The timing of drawdowns by recipients has substantial impact on the
Treasury Department's management of the public debt and financing
costs. Excess cash held by one recipient could have been used by other
recipients without the Government incurring interest costs for additional
funds. Premature drawdowns result in unnecessary interest costs
incurred by the Government.
Additionally, the IPA reviewed the Cash Transaction Reports to
verify that drawdowns reported by recipients were reconciled to EPA's
accounting records. In one instance a recipient's award amount recorded
in the accounting system did not agree with the letter of credit history by
$2,742,948, and the unpaid obligations differed by $1,122,070.
Reconciling the Cash Transaction Reports to EPA's accounting records is
an integral process of monitoring letters of credit. Failure to perform
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such reconciliations could result in inaccurate information in EPA's
financial records.
The cause of the conditions cited above can be partly attributed to a
lack of Headquarters guidance regarding reconciliation of the reports to
the accounting records. Also, some regions indicated that they did not
have sufficient staff to followup late filings and excess cash on hand
balances.
In response to the draft report the Agency has taken necessary
action concerning reconciling recipients' drawdown amounts and
following up on late filers of the Federal Cash Transaction Reports.
However, they do not agree that additional guidance is needed.
The IPA recommended that Agency management issue additional
guidance requiring that followup action taken on a recipient's
noncompliance with filing requirements be documented.
5. ACCOUNTS RECEIVABLE
A review of Superfund accounts receivable indicated that
improvements were needed to ensure that: (i) all receivables are
recorded in a timely manner; (ii) interest is correctly computed and
recorded; and (iii) aggressive action is taken to collect delinquent debts.
For the purposes of this report, accounts receivable are defined as
moneys due EPA, such as refunds for overpayments of cooperative
agreements or grants, repayment of travel advances, fines and penalties
resulting from litigation and cost recovery. A judgmental sample of 11
collections, totaling $12,563,841, out of a total collection universe of
$20,577,273, disclosed that 10, totaling $11,940,785, were not recorded as
receivables until after a check in payment was received. Although this
problem had been reported in two prior Superfund audits, and FMD had
agreed to take corrective action to improve the situation, the problem
still persists.
The Agency did not always correctly compute and record
interest for receivables that were delinquent. The Debt Collection Act of
1982 or the Federal Claims Collection Standards generally allow the
Agency to collect interest. An evaluation of accounts receivable at two of
the ten regions disclosed that nine receivables from a total of 18 were
outstanding for more than 30 days and that no interest was assessed on
these overdue accounts. Due to the omission of the interest, the balances
of accounts receivable were understated. The IPA estimated that the
understatement of interest accrued was $7,243. They identified two
primary reasons for the Agency not recording interest: interest charges
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were not included in the payment terms on the bill sent to the debtor; or
Agency personnel were unfamiliar with Agency directives.
Collection action was needed to ensure that debtors pay the Agency
in a timely manner. The IPA noted that one Region and Headquarters
were generally not collecting receivables as aggressively as Agency
directives require. The total balance of accounts receivable due over 120
days in Headquarters was over $6 million as of the end of fiscal 1987.
Deficiencies in collection activities were in most cases, closely related to
monitoring and management of delinquent accounts receivable. The IPA
found Headquarters did not conduct sufficient periodic management
reviews of its Superfund accounts receivable balances during fiscal 1987,
to determine whether accounts were valid and collectible, or were invalid
and delinquent, uncollectible, subject to deferred payment arrangements,
or in need of special efforts.
We issued an audit report (No. E1A67-11-0029-80779, dated March
17,1988) covering a review of EPA's accounts receivable activities. This
report identified similar findings and made appropriate recommend-
ations. Consequently, we made no further recommendations in
anticipation that the Agency will respond and take the needed corrective
action.
Action Taken
The final audit report was issued on September 21,1988, Audit Report
Number P5EH8-11-0030-81917. The Assistant Administrator for Administration
and Resources Management has 90 days to act on the recommendations made in the
report and to report to us on the status of these actions.
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RESPONSE CLAIMS
BACKGROUND
An important part of the Superfund program is to encourage voluntary
cleanup by private industries and individuals when they are responsible for releases.
Section 111 of CERCLA, as amended by the Superfund Amendments and
Reauthorization Act of 1986, authorizes persons (other than the U.S. Government,
State and local governments, or Indian Tribes) to seek reimbursement for response
costs incurred in carrying out the NCP.
Section 300.25(d) of the NCP states in part that such claims "may only be
reimbursed if such person notifies the Administrator of the Environmental
Protection Agency or his/her designee prior to taking such action and receives prior
approval to take such action." If response claims have not been preauthorized in
advance, EPA returns them without any determination of their merits.
Preauthorization has four important objectives. First, it enables the Agency to
fulfill its role as Superfund manager by helping to ensure appropriate uses of the
Trust Fund. Second, preauthorization of response actions reduces the likelihood
that responses themselves will create environmental hazards. Third,
preauthorization helps to ensure that a claimant will carry out a response action in a
manner consistent with applicable, or relevant and appropriate, environmental and
public health laws and implementing regulations. Fourth, preauthorization gives the
claimant an assurance that if the response is conducted in accordance with EPA's
approval and the costs are reasonable and necessary, the claimant will receive
monies from the Fund.
SCOPE AND OBJECTIVES
There were no claims filed in fiscal 1987 to audit. However, the Agency had
established a claims process and considered during the year five claims
preauthorization requests as part of agreements with potential responsible parties
(PRPs). We conducted a survey of the claims process from its inception. Our survey
covered Headquarters, which has approval authority for claims preauthorizations,
and Region 3 (Philadelphia), which was responsible for two of the three approved
mixed funding agreements.
The objectives of the survey were to determine if: (1) the Agency met all
statutory requirements in the preauthorization process; (2) internal controls were
effective in preventing excessive claims against the Fund; and (3) the Agency
handled the requests for preauthorization of claims against the Fund consistently
and timely.
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RESULTS OF SURVEY
Overall, we did not identify any potentially significant problems with the
process which would warrant further audit work at this time. Regarding our specific
objectives, we found the language in the Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA) to be brief and unspecific. In fact, it is
so unspecific that at the time of our survey, the State of Ohio, United Technologies
Company and others had filed a lawsuit which claimed that the preauthorization
process is illegal. Since the court's decision was pending, further audit work to
determine if the Agency met all statutory requirements was not beneficial. (On
February 12,1988, the D.C. Court of Appeals upheld EPA's position on
preauthorization. The Agency may continue to use the preauthorization process to
manage the Fund.) Second, we found no apparent internal control weaknesses in
the preauthorization process. However, we cannot conclusively determine that
there are no internal control weaknesses in the process because no claims against
the Fund had been filed or paid at the time of our review. Finally, Headquarters
handled preauthorization requests consistently and timely. The processing time
continues to improve as the procedures are refined and experience is gained.
We did have two concerns which we reported to management. The first was
that EPA Headquarters relied totally on one person for everything in the
preauthorization area. We suggested that EPA designate a backup employee and
provide the necessary cross-training.
Our second concern was that some EPA regions did not plan to use
preauthorization. We suggested that EPA decide on a national policy on response
claims and issue appropriate instructions to the regions so that PRPs receive
consistent treatment throughout all of the regions.
EPA management concurred with both of our concerns. The Agency
indicated that appropriate action would be taken in accordance with our
suggestions.
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SUPERFUND COOPERATIVE AGREEMENTS
SCOPE AND OBJECTIVES
We prepared a "capping" report (Audit Report No. E5eE8-09-0018-80838,
dated March 29,1988) summarizing the EPA audit reports issued on Super-fund
cooperative agreements awarded under the Comprehensive Environmental
Response, Compensation, and Liability Act of 1980. The report provides an
overview of the findings contained in the Office of Audit's (OA) Superfund
cooperative agreement audits issued during fiscal years 1985,1986, and 1987. The
purpose of this report was to inform senior EPA management officials of the
recurring problems identified in our cooperative agreement audits, and to
recommend actions or policy changes to alleviate the problems.
The report represented a summarization of the audit deficiencies noted in 33
audit reports issued by the EPA, OA on Superfund cooperative agreements. The
audit reports covered cooperative agreement activities in 9 EPA regions and 20
States. The total value of the cooperative agreements reviewed was $136,323,064.
The reports included 7 audits directed at the regions' administration of cooperative
agreements, and 26 audits of individual cooperative agreements. Twenty-four audits
.were performed by the EPA Office of Inspector General (OIG) staff and 9 by
independent public accountants who were under contract to the OIG.
It should be noted that the 33 audits were performed with varying scopes of
audit. In this regard, 24 of the audits were limited to a review of financial and
compliance areas, while the audit scope for 9 audits incorporated a review of
program performance. A list of the 33 audit reports reviewed and the major
deficiencies noted is included in exhibit III.
SUMMARY OF FINDINGS
We concluded that work under the $136.3 million of Superfund cooperative
agreements was not effectively performed by the recipients, or adequately
monitored by the regions. Since the activities addressed in these cooperative
agreements were directed to some of the most serious and potentially serious
hazardous waste conditions in the regions and affected States, increased EPA
Headquarters and regional attention needed to be directed to the cooperative
agreement area. The audits disclosed that performance goals and objectives of the
agreements were often not attained. In priority areas, such as remedial
investigation/feasibility studies, work was substantially behind schedule. Similarly,
priority preremedial actions related to preliminary assessments, site inspections, and
hazard ranking scores frequently were not performed in a timely and effective
manner. These conditions occurred, in part, because Remedial Project Managers
had not effectively performed their recipient oversight responsibilities. The audit
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also disclosed deficiencies related to recipients': (1) procurement systems frequently
not being in compliance with the regulatory requirements contained in 40 CFR Part
33; (ii) accounting systems being inadequate to form a basis for cost recovery under
the Superfund program; (iii) letter of credit activities not meeting requirements; and
(iv) personal property and equipment systems not being properly managed to
protect Superfund acquired items. Further, the audits noted that cooperative
agreement special conditions and reporting requirements were not always met by
recipients, or adequately monitored by the regions.
FINDINGS
1. UNSATISFACTORY PROGRAM PERFORMANCE UNDER
COOPERATIVE AGREEMENTS
Recipients had not effectively performed their cooperative
agreement goals and objectives, or were substantially behind schedule in
their completion. As a result, the planned improvements to the
environment were not achieved. In this respect, we found that: (i) EPA
was not provided the information necessary to determine if additional
hazardous waste sites should be listed on the National Priorities List
(NPL); (ii) the accelerated cleanup of hazardous waste sites had not been
attained; (iii) the performance of the preremedial and the remedial
planning requirements was substantially delayed; (iv) the levels of
community involvement provided for in the cooperative agreements were
not attained; and (v) the sampling and testing programs utilized by the
recipients needed improvement. Since many of the Superfund sites
addressed in the cooperative agreements were experiencing problems
with respect to groundwater and drinking water contamination, it is
important that additional emphasis be placed on the recipients attaining
their goals and objectives.
Several factors contributed to these conditions, including
premature awards to some recipients that had not met the financial,
technical, and experience requirements for an award. In addition, some
regions and recipients developed a complacent or passive attitude
towards achievement of cooperative agreement objectives. We also
noted that some regional offices and recipients failed to establish
effective lines of communication and working relationships with each
other. Finally, the regions had not always maintained accurate
management information systems to reflect the status of the existing and
proposed NPL sites within their geographical boundaries.
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2. PROBLEMS WITH PERFORMANCE OF REMEDIAL
INVESTIGATIONS AND FEASIBILITY STUDIES
Cooperative agreement recipients were experiencing significant
problems completing remedial investigations and feasibility studies
(RI/FS). The problems included untimely and ineffective performance
on all RI/FS actions which were reviewed in our cooperative agreement
audit reports issued between fiscal 1985 and 1987. Only 5 of the 37 RI/FS
actions reviewed, or 14 percent, had been completed, and only one of
the five was completed in less than 2 years. The remaining RI/FS actions
have been in progress for as long as 5 years without being completed. In
one region, work on eight RI/FSs had not begun, although more than $6
million had been obligated for this work. The lack of timely action
delayed completion of the RI/FS process and the ultimate cleanup of the
Superfund sites. All of the incomplete RI/FS actions pertained to
sites with significant environmental hazards, which require priority
attention to assure that remedial action is initiated in a timely manner.
Some of the sites with the delayed RI/FS reports were experiencing
environmental hazards such as: (i) arsenic in drinking water supplies; (ii)
copper, barium, lead, and zinc in groundwater; (iii) wind-blown tailings
contaminating groundwater; (iv) contaminated resident wells, and (v)
hazardous wastes in ground and surface waters.
The following example illustrates one State's ineffective
management practices on a site. In this case, the township first became
aware of a problem with hazardous waste in 1953. Over the years some
initial cleanup steps were performed, such as the installation of filters to
prevent contaminants from reaching a nearby stream. In 1982, the site
was placed on the NPL. Subsequent inspections indicated that the filters
had not been maintained and that contaminants were entering the stream.
Although the State selected a contractor to perform the RI/FS in January
1986, to determine the final cleanup options, the formal contract had
not been signed at the time of the audit, one year later. This condition was
particularly bad, since the State had promised the public, as early as 1984,
that the RI/FSs were about to start. The latest date for beginning the
RI/FS work was estimated as June 1987. It is entirely possible that the
RI/FS could have been completed or substantially completed by that date
if the State had effectively performed its procurement responsibilities.
In view of the substantial problem which exists in the RI/FS area,
we believe that a significant improvement in the cooperative agreement
recipients' RI/FS procedures, and in EPA's monitoring efforts will be
required if this condition is to be corrected.
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3. MONITORING OF PREREMEDIAL FUNCTIONS IS INADEQUATE
Monitoring the preremedial functions specified in the cooperative
agreements needed to be strengthened to assure that they were
performed in a timely and effective manner. Our audits of the
preremedial functions found that: (i) preliminary assessments (PAs) were
not completed within established schedules; (ii) site inspections (Sis)
were not always accomplished in accordance with EPA requirements; and
(iii) the Hazard Ranking System (HRS) process had not been
consistently followed.
One audit report indicated that the SI reports were not prepared in
a timely or quality manner. A total of 20 Sis were selected for review
during the audit. However, eleven of the SI files were not reviewed
because the files could not be readily located. The nine files which were
available for review disclosed that periods of up to two years were
required to finalize the results of the State's one day SI field visit. For
example, the SI for the Voortman Farm site took over 18 months to
finalize. The SI for the Hebelka site required about 2 years to complete.
There was also a problem with the quality of the work performed at the
East Mount Zion site. The recipient's sampling at this site showed that a
serious hazardous waste contamination problem existed. This led to the
eventual inclusion of the site on the NPL. However, an independent
sampling performed by an EPA contractor did not disclose any
contamination problem. Because the sampling efforts were not
coordinated, there was no opportunity to reconcile the differences before
the site was listed on the NPL. Duplicate sampling by the Region and the
recipient is a costly and wasteful practice, which could be avoided by the
development of a site-specific sampling plan early in the SI process.
In addition, the audits disclosed that some States failed to perform
any of the required PA and SI work. In addition, the Regions have not
utilized the HRS process in a manner which would assure the
identification of the most serious hazardous waste sites. These conditions
precluded timely and effective determinations as to the degree of
severity of the hazardous waste problems and whether the sites should be
included on the NPL. These problems have also delayed the initiation of
subsequent cleanup actions on these sites. We believe preremedial
activities may become a more critical area under the requirements of the
Superfund Amendments and Reauthorization Act of 1986, which
establishes strict deadlines for the completion of PAs, Sis, and HRS
scoring packages.
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4. REGIONAL OVERSIGHT ACTIVITIES NEED IMPROVEMENT
The Regions were not effectively performing their oversight
responsibilities under the Superfund cooperative agreements. This
condition contributed to delays in performing cooperative agreements
and may adversely affect cost recovery efforts against Potentially
Responsible Parties. These shortcomings have resulted primarily from
(i) a lack of sufficient training and guidance to assist Remedial Project
Managers (RPM) to perform their Superfund responsibilities, (ii) the
Regions' failure to always take an aggressive role in assuring the
completion of the required cooperative agreement work, (iii) poor
communication of Superfund requirements to the cooperative agreement
recipients, and (iv) inadequate documentation of Superfund cooperative
agreement files. Improvements in each of the above areas are essential to
assure that Superfund cooperative agreement requirements are
successfully performed.
5. PROCUREMENT SYSTEM DEFICIENCIES
The Superfund cooperative agreement audits disclosed widespread
noncompliance with procurement requirements contained in 40 CFR Part
33. The extent of procurement deficiencies is of particular concern since
the value of the cooperative agreements included in this review exceeded
$136 million. As the majority of work is conducted by contractors, the
ultimate success of EPA's Superfund program is, to a large measure,
based on its ability to obtain quality contractors and subcontractors in a
timely and cost effective manner. As a means of accomplishing this
objective, we believe that the effectiveness of the procurement actions
made under the cooperative agreement process must be improved.
Procurement problems noted in the audits included: (i) the failure
to provide for free and open competition; (ii) the absence of effective
affirmative action plans; (iii) a lack of adequate documentation
supporting the procurement awards; (iv) the use of prohibited forms of
contracting; (v) an absence of adequate cost and price considerations;
(vi) the failure to give adequate public notice on competitive
procurements; (vii) the lack of required EPA standard clauses in the
subagreements; and (viii) the omission of references to the applicable
Federal cost principles in the subagreements. Since many of the
cooperative agreement recipients had previously certified that their
procurement systems met the regulatory requirements, the extent of the
noncompliance demonstrated that little reliance can be placed on these
certifications.
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Some examples of the various procurement deficiencies disclosed
during our audits are summarized below.
Under the Purity cooperative agreement, a $749,500 fixed price
subagreement was awarded without adequate cost and price
considerations. This condition was compounded by the fact: (i)
the firm receiving the award was not the most qualified overall
offerer; (ii) the fixed price award amount was $461,300 more
than the most qualified offerer's price of $288,200; and (iii)
there was no evidence that an attempt was made to negotiate a
reduction in the proposed price. We considered the price
difference to be excessive, and informed the Region that any
payments in excess of the most qualified offerer's price would
represent a waste of Federal funds. The Region supported the
audit position, and has limited Federal reimbursements to the
$288,200 amount.
Another report disclosed that a State had awarded four
prohibited cost-plus-percentage of cost subagreements, with a
total value of $543,907. We concluded that EPA should
participate in the costs of these subagreements only on the basis
of a fair and reasonable value for the services provided.
We also found that one State's procurement techniques did not
always provide for maximum open and free competition. The
audit disclosed problems with competitive bidding in 5 of the 11
contracts reviewed. Competitive bidding techniques were not
utilized during the two occasions that the State amended its
emergency hauling contracts under the Stringfellow cooperative
agreement. In one of these occasions, competition was
restricted due to the contractor's elimination of competition by
underbidding the cost of the liquid waste disposal portion of the
hauling work.
Several of the deficiencies noted in our audits were previously
discussed in EPA Headquarters' reviews of some recipients' cooperative
agreements. However, timely corrective actions on the EPA
Headquarters' recommendations were not always made.
6. FINANCIAL MANAGEMENT OVERSIGHT FUNCTIONS
REQUIRE IMPROVEMENT
The Regions had not developed monitoring procedures to assure
that adequate financial management systems were established and
maintained by cooperative agreement recipients. The extent of the
deficiencies noted casts doubt on the recipients' ability to account for the
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approximately $136.3 million of Superfund site specific costs expected
to be incurred under the cooperative agreements included in this report.
Since the NCP requires that adequate documentation be maintained to
form a basis for cost recovery under the Superfund program,
improvements in the financial management area are necessary.
Specifically, our audits disclosed that recipients had unacceptable
timekeeping and labor charging practices, and failed to maintain their
accounting systems in accordance with EPA regulations. A lack of
Regional attention to the recipients' financial management systems was
considered a major cause of these conditions. We believe that the
accounting system deficiencies noted in the audits represent significant
internal control weaknesses, which affect the integrity of the accounting
system, and jeopardize the Federal government's ability to recover
Superfund costs from responsible parties. The audits also disclosed that
two EPA Regions had not deobligated approximately $11 million of
unneeded Superfund monies.
7. INADEQUATE LETTER OF CREDIT PROCEDURES
Recipients did not fully comply with the letter of credit (LOG)
requirements provided in their cooperative agreements and the LOC
Users Manual. As a result, the LOC was not effectively utilized as a
means of disbursing Federal funds under the cooperative agreements.
The audits noted that: (i) Federal Cash Transaction Reports (SF-272)
were not submitted within the required timeframes; (ii) staff in one
Region was changing the certified SF-272 reports without written
notification to the recipients; (iii) drawdown amounts were not calculated
properly; (iv) drawdowns were not made on a timely basis; and (v)
regional reviews of recipients' drawdown requests were not adequate.
The following examples illustrate some of the calculation problems
noted in our audits. The drawdown amounts calculated by two recipients
were incorrect. The amounts calculated included an advance of funds for
future anticipated expenses. EPA policy precludes including such
estimates in the calculation. The recipients overstated their drawdown
requests by $70,000 and $33,000, due to the inclusion of the anticipated
expenses. To ensure that recipients do not draw down excessive funds in
future periods, the recipients need to be instructed that drawdown
calculations must be based on incurred costs, and that anticipated
expenditures must be excluded from calculation. Another audit report
disclosed that the State improperly drew down funds from its Superfund
cooperative agreement to cover expenditures for its other EPA grant
programs which had no available funds. The audit report noted that
cooperative agreement funds of approximately $47,000 were utilized for
this purpose. Without prior written permission from the EPA award
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official, a recipient may not draw down from one program to pay
expenditures for another program.
These conditions were primarily attributable to a lack of regional
and recipient management attention to the requirements of the LOG
system, including a lack of written LOG operating procedures for the
recipients. While some LOG guidance was included in various user
manuals, it was also apparent that this material was either not available or
not used by the recipients. We believe that compliance with LOG
procedures would be improved if LOG information were condensed
and presented in a written summary for use by recipient personnel
8. MORE EFFECTIVE REPORTING PROCEDURES ARE NECESSARY
Superfund cooperative agreement reporting procedures were not
complied with by recipients or adequately monitored by the Regions.
The required reports, which included Financial Status Reports and
Quarterly Progress Reports, were necessary to keep management
apprised of the financial and technical aspects of the project. We
attributed the reporting problems to: (i) the recipients' failure to
implement the procedures necessary to comply with the requirements of
their cooperative agreements; and (ii) a failure to give priority to the
reporting requirements.
9. LACK OF COMPLIANCE WITH COOPERATIVE AGREEMENT
SPECIAL CONDITIONS
Regional procedures required improvement to assure that
recipients complied with the cooperative agreement special
conditions. Our audits disclosed that many recipients had not complied
with one or more of their cooperative agreement special conditions,
including those applicable to: (i) progress reporting; (ii) use of the letter
of credit; (iii) Federal procurement standards; (iv) conflict of interest
statements; (v) site safety plans; (vi) National Contingency Plan; and (vii)
timekeeping systems. To ensure that the objectives of the cooperative
agreements are satisfied, it is important that all special conditions be met.
As a result of noncompliance with site safety plans, we found
instances where EPA could not adequately assure that the health and
safety of the public would be adequately safeguarded. In one instance the
State had conducted two site investigations and four preliminary
assessments without a safety plan in effect at these sites. The audit report
concluded that the lack of State action precluded EPA from assuring that
the health and safety of the public would be adequately safeguarded
before the assessments and investigations were conducted. We also
found that hazardous waste samples were not analyzed as required by the
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NCP. Instead, the samples were stored in a 40-foot trailer at the
hazardous waste site. Other samples collected by EPA were stored in
unsealed barrels adjacent to the sample storage trailer. According to
State staff members, the samples stored in the trailer could collectively
present a health and environmental risk if vandalism or a fire were to
occur.
10. MANAGEMENT OF SUPERFUND PERSONAL PROPERTY
NEEDS TO BE STRENGTHENED
Management of personal property and equipment purchased
under Superfund cooperative agreements was not in accordance with the
requirements of the Federal property regulations. Our audits disclosed
that (i) the Federal government's interest was not recorded; (ii) some
items could not be located by the recipient; and (iii) lost or stolen items
were not reported to EPA. Although property and equipment purchases
under the Superfund cooperative agreements have generally been
nominal to date, such purchases are expected to become more significant
as the program moves from the planning to remedial action stages.
Therefore, it is important that EPA emphasize the need to comply with
the applicable Federal property regulations to both its Regional
personnel and the cooperative agreement recipients.
PRIOR AGENCY ACTION
In response to Agency concerns and its analysis of the individual reports and
our draft "capping" report, the Agency had initiated or scheduled action fully
addressing most of our findings:
Management Assistance Program (MAP) reviews of State management
systems.
Preparation of a revised "Guide for Preparing and Reviewing Superfund
Cooperative Agreements" and development of a companion guide for State
use.
Development of training courses in Superfund procurement and
cooperative agreement administration.
Strengthening technical assistance to States by moving regional assistance
administration units into the lead in directing administrative oversight of
cooperative agreements, while remedial project managers focus on
compliance with the National Contingency Plan.
Development of a Superfund assistance regulation, to be effective
October 1,1988.
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Development of a Superfund administrative management system to
automate the tracking of corrective actions, cooperative agreement audits,
regional oversight reviews, and MAP reviews.
Development of EPA/State Superfund memorandums of agreement
clearly delineating roles and responsibilities of each agency for CERCLA
response activities.
Preparation and distribution of "State Superfund Financial Management
and Recordkeeping Guidance" and training of regional and State personnel
in this area.
Issuance of a Comptroller's policy announcement to re-emphasize letter of
credit requirements and implement additional reconciliation controls.
Review and provide guidance on reporting requirements.
Naming of contacts, at the time of cooperative agreement award, for
administrative management, finance, and technical program questions; and
establishment of systems for tracking compliance with special conditions.
Review of property management procedures leading to development of a
property management policy manual.
RECOMMENDATION AND FURTHER AGENCY ACTION
The Agency's actions were adequate for all findings except Finding No. 3. On
that finding we recommended that EPA review the HRS scoring quality assurance
process to ascertain what additional controls are necessary to improve the
consistency and accuracy of HRS scoring packages. In response, the Agency
indicated our recommendations were "well taken" and that the Agency intended to
continue to improve the quality control/quality assurance process.
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OTHER INTERNAL AND MANAGEMENT AUDITS
In addition to reviews required by CERCLA, as amended, we reviewed other
aspects of EPA's management of the Superfund program, as our resources
permitted. Such reviews completed in fiscal 1987 are summarized below.
A. SUPERFUND MANAGEMENT INFORMATION SYSTEM (CERCLIS)
SCOPE AND OBJECTIVES
We reviewed and evaluated the Office of Emergency and Remedial
Response's efforts to develop a comprehensive Superfund management
information system (MIS) to consolidate information contained in
various Agency management information systems. The purpose of the
audit was to evaluate whether the CERCLIS modification effort (1) was
developed in a cost-effective and efficient manner and (2) accomplished
the stated goals and objectives.
We conducted the audit field work from March 1986 through July
1986, with follow-up work conducted during November and December
1986 and April through June 1987. The audit was conducted at EPA
Headquarters and Regions 2,4,5,6, and 9.
Our audit period covered CERCLIS MIS activities starting in
December 1984 and ending in June 1987. We reviewed the current
processes used to collect, maintain, and communicate information from
original sources to ultimate users both in the regions and in
Headquarters. This included reviews of both automated and manual
processes, as well as formal and informal communication procedures.
Our audit work included interviews with regional and Headquarters
management and operational personnel.
FINDINGS
We found significant problems during the first stages of the audit.
We discussed these with EPA management, which made major
improvements during the course of the audit. However, some
deficiencies still remained which are discussed in the findings below.
1. OSWER Needs to Strengthen Its Monitoring Role
Life Cycle Management (LCM) is a common sense approach
for systematically planning and developing an effective and efficient
automated management information system in a cost effective
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manner. OERR did not properly follow OSWER'S LCM and
Configuration Management (CM) policies and procedures.
OERR did not develop a Mission Element Needs Statement
(MENS) until 9 months after initiating work on the CERCLIS
modification effort. The MENS, which documents the project's
purpose and feasibility, is the first phase of the LCM process. We also
found that the MENS, when finally developed, was inadequate for
decision making purposes because it did not adequately address key
elements such as the need for the modification, the purpose and
objectives of the modification, and the expected benefits to be
derived. Further, OERR did not provide an overall master plan for
the development of the automated system with major milestone dates
and estimated costs. As a result, the scope and extent of the
modification effort was missing.
Also, OERR did not evaluate various alternatives and perform
a cost/benefit analysis to ensure that the modification design chosen
was the most cost effective and efficient software application to meet
regional and Headquarters programmatic and operational user needs.
In addition, OERR had not adequately identified and evaluated the
existing quality assurance processes and controls (QA/QC) to
determine the need for additional controls within the regions and
Headquarters. Effective controls are needed to ensure data quality
and proper reporting by Superfund program offices. However, in
April 1987, OSWER identified the regional QA/QC functions and
allocated up to 28 full-time equivalent positions for these functions.
While these actions will help to alleviate the regional problems, we
believe additional controls are still needed such as system edit checks.
2. Budgeting Procedures Need to be Established
LCM procedures require establishing budgeting and accounting
procedures for the modification effort to ensure that the development
effort is conducted in a cost effective manner and stays within the
planned budget. These processes should account for all LCM costs.
OERR did not develop a cost estimate for the entire modification and
did not account for all the LCM costs incurred. Additionally, OERR
had not specifically budgeted for this effort in fiscal 1986 and
underestimated its fiscal 1987 requirements by $1.9 million.
Because OERR's MENS and System Decision Papers did not include
a cost estimate, we cannot assess whether the $1.9 million increase
was the result of changes in the project's scope or unplanned actions
and whether the increase was necessary.
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RECOMMENDATIONS
We recommended that EPA:
Require all modification and development work to comply
with OSWER policies and procedures;
Ensure all system development and modification efforts are
properly costed and fully budgeted prior to initiating work;
Establish financial procedures to track, document, and
account for all modifications costs;
Analyze the cost effectiveness and efficiency of single
versus multiple regional data entry and retrieval systems to
determine whether a standard regional system should be
established;
Establish quality assurance procedures and controls to
ensure data are reported properly, accurately, and timely;
and
Develop an Agencywide directive to establish mandatory
reporting of Superfund information.
AGENCY RESPONSE
OSWER has addressed many of the problems we identified during
our review either through immediate corrective actions or planned
actions. OSWER established a Board of Directors which has improved
coordination among offices involved in developing CERCLIS.
In response to our audit report, the Agency indicated it fully
supported our recommendations on Finding No. 1 and is in the process o
implementing them. It also indicated it generally supported and is
implementing our recommendations on Finding 2.
B. UNANNOUNCED ON-SITE REVIEWS OF REMOVAL ACTIONS
BACKGROUND
CERCLA authorizes removal actions at hazardous waste spills
and sites, whether or not they are on the National Priorities List
(NPL). In contrast to long-term remedial response, removals are
generally short-term time-critical actions needed to abate a threat.
They are not subject to the detailed planning process used for
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remedial actions, and the work is generally directed on a day-to-day basis
by a Federal official.
The on-scene coordinator (OSC) is the Federal official
designated to coordinate and direct Federal response at a site.
Implementation of removal actions is usually done under one of a
number of Emergency Response Cleanup Services (ERCS) contracts.
The OSC is normally assisted by a Technical Assistance Team (TAT)
contractor to monitor the response, develop the workplan and
document the cleanup costs.
The OIG has been performing unannounced on-site audits of
removal actions for several years. During fiscal 1987, we issued three
reports of such audits. The removals audited were at the Commercial Oil
Services site in Oregon, Ohio; the Delancy Street Trailer site in Newark,
New Jersey; and the Signo Trading Warehouse site in Mount Vernon,
New York.
SCOPE AND OBJECTIVES
Those reviews normally included a site visit of 1-3 days while a
removal is in progress. While at the site, auditors observe conditions,
review documentation and interview personnel. There is usually
follow-up work at the EPA regional office to review documentation that
is not at the site and to interview appropriate personnel.
The objectives of each review were to determine:
Adequacy of the OSC compliance with prescribed directives
and guidance governing removal actions;
Adequacy of the OSC's controls in monitoring the cleanup
work and on-site spending; and
Adequacy of the technical assistance provided by the TAT
contractor.
FINDINGS
In general, we found fewer deficiencies this year than we had in
such reviews in prior years. At Signo Trading Warehouse, the
deficiencies found were minor and we offered no formal
recommendations requiring response. At the other two sites, we found
that the matters reviewed were generally being adequately handled, with
a few deficiencies requiring corrective action.
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At Commercial Oil Services, we found that the OSCs spent an
average of only 6.5 hours per day on the site, while the removal action was
operated on a 24-hour basis, seven days a week. As a result certain
reports were not completed timely. Because the removal was properly
considered a routine action, overtime by the OSC was not required. The
failure to spend eight hours a day on-site was due to a long commuting
time. There was no clear regional policy regarding commuting time. We
also found excessive turnover in TAT staff, resulting in high travel costs,
and TAT assistance being provided by personnel inexperienced at the site.
At Delancy Street Trailer, security was inadequate. Security
guards were not always on duty, were sometimes unaware of the scope
of their duties and were located too far away from the trailer. The OSC
and TAT had previously noted security problems and the OSC had
disputed some of the charges for security services. We also found that the
logs maintained at the site were not adequate to verify all personnel costs
charged.
RECOMMENDATIONS
At Commercial Oil Services, we recommended that the Regional
Administrator (1) establish specific regional guidelines concerning the
time OSCs spend on removal sites, including whether commuting time is
included in the eight hour workday; and (2) review TAT staff rotation
practices to ensure that the rotations are economical and effective.
At Delancy Street Trailer, we recommended on the security finding
that the Regional Administrator (1) direct that future delivery orders
require contractors to more closely monitor security services; and (2)
direct an analysis of security problems during removal actions to
determine if some firms have a pattern of inadequate performance, and
not to give consent for utilization of any such firms. We also
recommended that the Regional Administrator (a) direct the OSC to
maintain more detailed information in the OSC log, and (b) re-evaluate
in future actions the necessity of paying the ERCS contractor for
employee travel time from the firm's office to the site.
AGENCY ACTION
In response to the Commerical Oil Services report, Region 5
issued a memorandum to all OSCs and their supervisors establishing
the regional guidelines. In addition, Region 5 brought the TAT staff
rotation issues to the attention of appropriate officials.
In response to the Delancy Street Trailer report, Region 2
implemented increased oversight of contractor security services at
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removal sites. In the event of a pattern of inadequate performance,
Region 2 will bring this to the attention of the contractor as a need for
improvement. If the needed improvement does not occur, the OSC
will not give consent to future use of the problem subcontractor.
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FINANCIAL AND COMPLIANCE AUDITS
The OIG is responsible for conducting and supervising independent and
objective audits relating to the programs and operations of Superfund. In order to
carry out this responsibility the OIG performs financial and compliance audits of
EPA contractors and assistance recipients. Each of the Public Laws authorizing
EPA to award assistance agreements and contracts provides that the Agency shall
have the authority to audit and examine the books and records of the recipients
receiving Federal funds. The provisions regarding audits are also clearly spelled out
in the general provisions of each EPA contract or agreement. Our primary audit
objectives are to determine (1) whether the controls exercised by the recipients
through their accounting, procurement, contract administration, and property
management systems are adequate to account for costs claimed; and (2) costs
claimed are reasonable, allowable, and allocable, in accordance with applicable laws
and regulations, to the sponsored project.
While the OIG is responsible for all audits of EPA contracts and assistance
agreements, we can elect to have the audits performed by in-house staff,
independent public accounting firms, or another Federal, State or local audit agency.
During fiscal 1987, our Superfund financial and compliance audits were performed
as follows:
Audits Performed by OIG Staff 57
Audits Performed by Independent Public Accountants 11
Audits Performed by another Federal Agency 24
A listing of all Superfund audit reports issued by the OIG during fiscal 1987 is
contained in Exhibit V.
During fiscal 1987, our audits of Superfund contracts and cooperative
agreements resulted in the following questioned and set-aside costs:
CONTRACTS
Total Costs Audited $ 355,097,324
Total Costs Accepted $ 252,829,356
Total Costs Questioned* $ 44,491,033
Total Costs Set-Aside** $ 57,776,926
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COOPERATIVE AGREEMENTS
Total Costs Audited $ 36,547,621
Federal Share Audited $ 34,657,489
Total Costs Accepted $ 25,756,711
Federal Share Accepted $ 24,258,341
Total Questioned* $ 1,952,621
Federal Share Questioned* $ 1,736,896
Total Set-Aside** $ 8,838,379
Federal Share Set-Aside** $ 8,662,252
* Questioned costs are costs that may be unallowable under the provisions of
applicable laws, regulations, or policies.
** Set-aside costs are costs that cannot be accepted without additional
information or evaluations and approvals by responsible Agency officials
Audits of contracts and assistance agreements have played a major role in not
only yielding financial benefits to the Agency, but also in improving Agency
management. With the increased size of the program and as more sites are actually
cleaned up, we expect to devote significant resources to auditing EPA contractors
and agreement recipients. These audits also play an integral part in supporting
EPA's cost recovery actions.
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ASSISTANCE TO EPA MANAGEMENT
In addition to performing audits and investigations, the Office of Inspector
General (OIG) responds to EPA management requests for OIG input in the
development of regulations, manuals, directives, guidance and procurements. These
are proactive efforts to prevent problems that would be reflected in later negative
audit findings or investigative results. The OIG reviews and comments on draft
documents prepared by Agency offices. In some instances, we designate an OIG
staff person to attend meetings of an EPA work group to provide input. Fiscal 1987
was an active year for OIG preventive assistance to EPA management in the
Superfund area.
Removals
EPA management frequently requested our assistance in preventing future
problems such as those found in audits of the procurement of removal contractors
and the management of removals. We reviewed a number of draft requests for
proposal for removal contracts. We also reviewed a draft revision of the ERCS
Contracts Users' Manual and worked with an Agency Work Group on Management
Support for Superfund's On-Scene Coordinators.
Technical Assistance Grants
The EPA Administrator requested that the OIG work closely with the
Superfund office in its efforts to develop the technical assistance grants program to
groups of persons affected by Superfund sites. Because these grants will be awarded
to small groups without grants experience or much administrative structure, the
Administrator recognized that this program presented special management
challenges. In response to this request, the OIG participated in work group
meetings and reviewed draft program documents, including the regulation itself.
This effort continued into fiscal 1988.
Cooperative Agreements
As the cooperative agreements section of this report indicates, we have been
conducting Superfund cooperative agreement audits for several years and have
frequently found significant deficiencies. For some time, Agency management has
involved the OIG in the development of guidance to improve management of
cooperative agreements. Fiscal 1987 was a particularly busy year in this area, due to
EPA implementation of SARA. The OIG provided a representative to the Agency's
State Issues Work Group and commented on numerous draft documents in this
area. These included the State involvement regulations required by SARA, which
are to be incorporated into the revised National Contingency Plan. We have also
been involved from the initial stages in the development of guidance on Superfund
Memorandums of Agreement and core program cooperative agreements.
32
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Other Assistance
In addition to the areas highlighted above, we have worked with EPA
management through work groups and reviews of draft documents on other
Superfund matters such as the management of Superfund property, internal
delegations of authority and development of the revised National Contingency Plan.
Our field offices also provide preventive assistance to EPA regional management,
generally through telephone conversations and meetings between managers.
Coordination with Other Agencies
Since EPA was given the responsibility of managing the Hazardous
Substance Superfund (Trust Fund), EPA's OIG took on the task of informing the
Federal OIG community (as well as appropriate audit organizations) of the
mandated audit requirements. The Superfund Amendments and Reauthorization
Act of 1986 requires"... the Inspector General of each department, agency or
instrumentality of the United States which is carrying out any authority..."
(emphasis added) under SARA to conduct an annual audit of uses of the Superfund.
As such, we formed an ad hoc work group comprised of representatives from a
number of OIGs or audit officials of those Federal departments or agencies which
have been given significant Fund-financed responsibilities by statute or Executive
Order 12580. The objectives of our work group are to:
- clarify the statutory requirement;
~ coordinate schedules and reports under the mandatory annual audit
requirement;
discuss funding mechanisms for the mandatory audit work; and
discuss program areas of concerns or audit findings.
These objectives are carried out through quarterly meetings of the full work
group and other individual contacts as needed.
In addition, we have worked with other IG's and audit officials to resolve
Superfund accounting and control problems. We coordinated these activities with
administrative and program offices at EPA to ensure that an effective audit product
would result. We participated in the review of guidance developed for use by the
other Federal agencies who receive Trust Fund monies. We provided the draft
guidance to the work group members for information and comment. Through these
activities we hoped to ensure consistent audit coverage as well as better
accountability and control over Trust Fund spending.
33
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OIG SUPERFUND RESOURCES
OIG Resources Have Not Kept Pace
Since the passage of the Superfund Amendments and Reauthorization Act of
1986 (SARA), audit needs in the Superfund area have increased substantially due to
two factors:
1. New mandatory requirements on the Inspector General included in
SARA; and
2. Increased size and complexity of the program.
CERCLA as originally enacted imposed no annual requirements upon the
Inspector General after the first two years of the Fund's operation. As amended by
SARA, CERCLA now requires annual audit efforts in four areas, an annual report
to Congress and review of an Agency annual report to Congress. The annual audit
efforts required resources beginning in fiscal 1987. The two reports were first
required to be submitted during fiscal 1988. The activities mandated by SARA will
require more than 25 FTE and $3 million in extramural resources each year.
SARA authorized a fund more than five times the size of that authorized in
CERCLA as originally enacted. It also provided for a number of new program
components, and established many additional requirements. The number and size
of contracts and assistance agreements requiring audit are increasing very rapidly.
At the same time, the number of program components which could benefit from
management audits has also increased substantially.
Exhibit IV shows that OIG Superfund FTEs have not increased
commensurate with the increase in the Agency's Superfund FTEs.
Questions Needing Audit Attention
OIG Superfund audit resources for fiscal 1989 are sufficient to fulfill the
statutory requirements and provide audit support to the contracting function.
However, we have deferred audit coverage of many significant aspects of EPA
management of Superfund until fiscal 1990 or later to provide resources for these
needs.
We have repeatedly found that the Agency's management of Superfund
needed improvement. Our findings and recommendations have led to management
improvements which save money, reduce delays in accomplishing the objectives of
the program and allow the Agency's efforts to produce greater environmental
34
-------
benefit. We believe these audits are a very productive investment reaping benefits
far in excess of their costs.
Many aspects of the Superfund program have not been reviewed by us, or have
changed substantially since they have been reviewed. If resources permit, audits can
address the kinds of questions listed below. This list is by no means exhaustive, but
is intended to indicate the kinds of reviews we should be undertaking.
Is the remedial contracting process resulting in economical and effective
responses?
Is EPA making full use of the new enforcement authorities provided under
SARA?
Are EPA accounting and administrative controls adequate to identify and
accumulate total site-specific costs chargeable to responsible parties?
Is the Agency's preremedial process resulting in the sites posing the
greatest threat, and only those sites, being placed on the National Priorities
List?
Are adequate administrative records being maintained consistent with the
requirements imposed by SARA?
Are States consistently providing the assurances required by CERCLA, as
amended?
Are remedial actions being conducted in a cost-effective, timely and
environmentally sound manner?
Is the research and development program provided by SARA producing
better cleanup options for use at Superfund sites?
Is EPA effectively managing the Federal facilities compliance program?
Are the data used in evaluating Superfund sites reliable?
Are the notification requirements of CERCLA being effectively enforced?
Is EPA meeting the schedules imposed by SARA?
Is the technical assistance grants program for community groups being
effectively implemented?
Do Records of Decision comply with Congressionally mandated cleanup
standards?
35
-------
Is EPA moving aggressively to recover Superfund costs from potentially
responsible parties (PRPs)?
Is EPA providing effective oversight of PRP responses to ensure that
their activities fulfill all statutory, regulatory and policy requirements?
The decentralized operation of the Superfund program affects the resources
needed to provide adequate audit coverage. In many respects, there are really ten
Superfund programsone in each EPA region. Approaches to implementing
Superfund vary enormously by region. In order to understand how an aspect of the
program is working, we must look at several regions in addition to Headquarters
directing the guidance. An effective audit of a program area often involves audits
in three regions, resulting in reports issued to the appropriate Regional
Administrators, and then a consolidated audit report to Headquarters on the overall
results.
Similarly, because of the Superfund's rapid growth, size, and complexity it is
particularly sensitive to fraud, waste, and abuse. It will require a substantial
investment in training and the development of new audit and investigative
approaches. By its nature, the Superfund requires the Agency to respond to
emergency situations with large amounts of cash under circumstances that are
difficult to control. We already have several Superfund related prosecutions and
more allegations of fraud involving contractors and project officers that we must
investigate.
36
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EXHIBTT I
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C.
HAZARDOUS SUBSTANCE RESPONSE TRUST FUND (SUPERFUND)
SCHEDULE OF OBLIGATIONS (NOTE 1)
FISCAL YEAR ENDED SEPTEMBER 30,1987
Description
Personnel Compensation
Personnel Benefits
Total Personnel Com -
pensation & Benefits
Travel and Transportation
of Persons
Transportation of Things
Rent, Communications,
and Utilities
Printing and Reproduction
Other Contractual
Service
Supplies and Materials
Equipment
Land and Structures
Grants, Subsidies, and
Contributions
Insurance Claims and
Indemnities
Total Non-Personnel
Compensation & Benefits
Grand Totals
Total
$ 73,792,675
11,211,892
85,004,567
7,281,678
546,242
14,351,736
682,107
719,323,565
2,568,509
19,527,982
784
166,207,910
2,068
Accepted
$ 73,792,675
11,211,892
85,004,567
7,281,678
539,852
13,821,828
686,098
719,025,767
2,536,043
19,396,139
679
166,207,065
2,065
Questioned
(NOTE 2)
$
-
_
6,390
529,908
(3,991)
297,798
32,466
131,843
105
845
3
930,492,581
$1,015,497,148
929,497,214
$1,014,501,781
995,367
$ 995,367
The accompanying notes are an integral part of this schedule.
37
-------
EXHIBIT T
(CONTTNTJFD)
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C.
HAZARDOUS SUBSTANCE SUPERFUND
NOTES TO SCHEDULE OF OBLIGATIONS
FISCAL YEAR ENDED SEPTEMBER 30,1987
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Schedule of Obligations was prepared by the EPA Financial
Management Division based on financial information contained in the Financial
Management System for the fiscal year ended September 30,1987. EPA's policy is
to prepare schedules in accordance with accounting policies and procedures that are
legislatively established and promulgated through various Federal and EPA policy
and procedural standards. This schedule is not intended to present either the
financial position or the financial results of operations in conformity with generally
accepted accounting principles.
Obligations - Nonpayroll
Obligations are amounts of orders placed, contracts awarded, services
received, travel performed, and similar transactions during a given period that will
require payments during the same or future periods. Such amounts include
disbursements for which obligations had not been previously recorded and reflect
adjustments for differences between obligations previously recorded and actual
disbursements to liquidate those obligations.
The term "obligation" includes both obligations that have matured (legal
liabilites) and those that are contingent upon some future performance, such as
providing services or furnishing materials. Obligations represent funds obligated
against the current fiscal year's appropriation, including carry-over authority for
appropriations from prior years. Obligations are recorded for budgetary purposes
by appropriation.
Obligations, as presented in this Exhibit, were reported by EPA's Financial
System Branch in a Special Superfund Audit Report from information contained in
the Financial Management System "Allotment File". The total obligations from this
report, amounting to $1,015,497,148, were reconciled with the totals reported by
EPA to the Office of Management and Budget for appropriations 68-20X8145 and
68-2068145 for the period ended September 30,1987.
38
-------
FXHTRTTT
(CONTINUED)
Obligations - Payroll
Payroll obligations are based upon actual personnel compensation and
benefits recorded monthly in the payroll subsystem plus accruals generated at
month-end. Personnel compensation and benefits obligations amounted to
$85,004,567, which, based on EPA policy, were recorded on an accrual basis for
obligation accounting.
NOTE 2. OBLIGATIONS QUESTIONED
Questioned obligations of $995,367 consist of $895,862 for general support
services costs improperly allocated to the Superfund appropriation, and $99,505 of
obligations, based on the projection of exceptions in the statistical samples.
a. General support services costs were questioned due to errors in cost
allocations as follows:
Description Region 4 Region 5 Headquarters
Transportation of Tilings $ 5,467 $ $ 923 $ 6,390
Rent, Communication and
Utilities 15,067 (2,915) 517,756 529,908
Printing and Reproduction 1,920 (6,003) 92 (3,991)
Other Contractual Services 56,238 23,977 217,583 297,798
Supplies and Materials 21,834 6,529 28,363
Equipment 19,706 16,735 36,441
Land and Structures 105 105
Grants, Subsidies and
Contributions 845 845
Insurance Claims and
Indemnities 3 3
Totals $120,232 $15,059 $760,571 $895,862
Additional detail relating to these cost allocation errors are contained in
Finding 2.
b. Questioned costs of $99,505 consists of the following:
Description Amount
Supplies and Materials $ 4,103 (i)
Equipment 95,402 (ii)
Total $99,505
39
-------
EXHIBIT T
(CONTINUED)
(i) Represents amounts questioned because of an excess allocation.
(ii) Represents amounts questioned because of a duplicate obligation of funds
and property that could not be located.
40
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EXHIBIT II
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, B.C.
HAZARDOUS SUBSTANCE RESPONSE TRUST FUND (SUPERFUND)
SCHEDULE OF DISBURSEMENTS (NOTE 1)
FISCAL YEAR ENDED SEPTEMBER 30, 1987
Description
Personnel Compensation
Personnel Benefits
Total Personnel Com -
pensation & Benefits
Total
$ 71,998,092
10,598,980
82,597,072
Accepted
$ 71,998,092
10,598,980
82,597,072
Questioned
(NOTE 2)
$
Travel and Transportation
of Persons
Transportation ofThings
Rent, Communications,
and Utilities
Printing and Reproduction
Other Contractual
Services
Supplies and Materials
Equipment
Land and Structures
Grants, Subsidies, and
Contributions
Insurance Claims and
Indemnities
Total Non-Personnel
Compensation & Benefits
Grand Totals
6,553,164
397,488
14,402,134
632,943
373,226,247
2,180,637
6,594,411
804
43,246,131
2,069
6,543,541
391,098
13,872,226
636,934
372,928,449
2,152,274
6,557,970
699
43,245,286
2,066
9,623
6,390
529,908
(3,991)
297,798
28,363
36,441
105
845
3
447,236,028
$ 529,833,100
446,330,543
$528,927,615
905,485
$ 905,485
The accompanying notes are an integral part of this schedule.
41
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EXHIBIT TT
(CONTINUED)
UNITED STATES
ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C.
HAZARDOUS SUBSTANCE SUPERFUND
NOTES TO SCHEDULE OF DISBURSEMENTS
FISCAL YEAR ENDED SEPTEMBER 30,1987
NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The Schedule of Disbursements was prepared by the EPA Financial
Management Division based on financial information contained in the Financial
Management System for the fiscal year ended September 30,1987. EPA's policy is
to prepare schedules in accordance with accounting policies and procedures that are
legislatively established and promulgated through various Federal and EPA policy
and procedural standards. This schedule is not intended to present either the
financial position or the financial results of operations in conformity with generally
accepted accounting principles.
Disbursements - Nonpayroll
Disbursements represent the amount of cash outlays made to liquidate
obligations. They represent funds disbursed during the current fiscal year against
either prior years' or current year's appropriations. Disbursements are recorded on
the cash basis of accounting hi EPA's general ledger by appropriation.
Disbursements, as presented in this Exhibit, were reported by EPA's Financial
Systems Branch in a Special Superfund Audit Report from information contained in
the Financial Management System "Allotment File." The total disbursements from
this report, amounting to $529,833,100 were reconciled with the totals reported by
EPA to the Office of Management and Budget for appropriations 68-20X8145 and
68-2068145 for the period ended September 30,1987.
Disbursements - Payroll
Personnel compensation and benefits disbursements amounted to
$82,597,072, which represented actual personnel compensation and benefits paid
during fiscal 1987 on a cash basis.
42
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FXHTBIT TT
(CONTINUED)
NOTE 2. DISBURSEMENTS QUESTIONED
Questioned disbursements of $905,485 consist of $895,862 for general support
services costs improperly allocated to the Superfund appropriation, and $9,623 of
disbursements based upon the projection of an exception from the statistical sample
transactions.
General support servicing costs were questioned due to errors in cost
allocations as follows:
Description
Transportation of Things
Rent, Communication and
Utilities
Printing and Reproduction
Other Contractual Services
Supplies and Materials
Equipment
Land and Structures
Grants, Subsidies and
Contributions
Insurance Claims and
Indemnities
Total
Reginn 4 Region 5 Headauarters
$ 5,467 $
15,067 (2,915)
1,920 (6,003)
56,238 23,977
21,834
19,706
$ 923
517,756
92
217,583
6,529
16,735
105
845
3
Total
$ 6,390
529,908
(3,991)
297,798
28,363
36,441
105
845
3
$120,232
$15,059
$760,571
$895,862
43
-------
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Exhibit IV
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46
-------
EXHIBIT V
lofS
SUPERFUND AUDIT REPORTS
ISSUED DURING FISCAL 1987
INTERNAL AND MANAGEMENT AUDITS
Final
Report
Number Auditee
71928 CA, S. BAY SUPERFUND, REGION 9
71911 CONSOLIDATED TRUST FUND REPORT
70474 REGION 3 TRUST FUND REPORT
71992 REGION 8 SUPERFUND CA
70807 REGION H-DELANCY STREET
70947 REGION HI COOPERATIVE AGREE
71997 SF INDIRECT FY 85&S6
71209 SIGNO TRADING WAREHOUSE, NY
71883 SITE REV COMMERCIAL OIL
71903 STATE REMEDIAL PROGRAMS
71904 STATE REMEDIAL PROGRAMS H
70901 SUPERFUND ICR FY 83 & 84
71991 SUPERFUND MIS (CERCLIS)
Audit
Control
Number
E5EH6090226
P5EH5110034
P5EH5110021
E5EH7080005
E5EH6020167
E5EH6030219
P5EH7110021
E5EH7020095
E5EH7050425
E5EH6030228
E5EH7030254
P5E16110020
E5E36110022
Date
Report
Issued
9/17/87
9/16/87
12/31/86
9/30/87
2/27/87
3/25/87
9/30/87
5/21/87
9/11/87
9/15/87
9/15/87
3/18/87
9/30/87
47
-------
EXHTBTTV
2 of 5
SUPERFUND AUDIT REPORTS
ISSUED DURING FISCAL 1987
COOPERATIVE AGREEMENTS AND OTHER GRANTS
Final
Report
71846
71311
70538
70869
70772
71762
71225
71159
71002
70902
71879
71483
70459
71190
70479
70767
70118
71312
71906
Auditee
AUDIT OF SUPERFUND UAG W/DOE
BIO ECOLOGY (TX WATER COMM)
COMMONWEALTH OF PENNSYLVANIA
DEPARTMENT OF ENERGY
FLORIDA DEPT. OF ENVIRO REG
HIGHLAND ACID PITS
ILLINOIS EPA SF COOP AGMT
LA DEPT OF ENVIRON QUALITY)
LOS ANGELES WATER AND POWER
MAINE SF COOPERATIVE AGREEMENT
MICHIGAN CREDIT CLAIM
MICHIGAN DNR SF COOP AGMT
MN PCA - ADM OF COOP AGMTS
NY DOEC ADM - SF COOP AGMTS
OKLAHOMA STATE DEPT OF HEALTH
SC DEPT HLTH COOP AGREEMENT
TOTAL CHEM SERVICES, INC
TRIANGLE CHEMICAL CO (TX WTR C
UTAH DEH COOP AGREEMENT UT
Audit
Control
Number
05BH71 10044
E5BG7060031
P5BH5 110056
05BH71 10028
P5BG6 110031
E5BG7060032
P5BG7050536
P5BG6 110032
E5AH7090049
P5BG61 10029
E5CG7050448
P5BG7050537
E5BH7050210
P5CG61 10030
E5BG7060030
E5CG4040100
P5CH61 10049
E5BG7060032
E5BG6080062
Date
Report
Issued
9/7/87
6/ 9/87
1/12/87
3/ 9/87
2/19/87
8/25/87
5/26/87
5/6/87
4/ 6/87
3/19/87
9/11/87
7/7/87
12/24/86
5/13/87
11 5/87
2/19/87
10/21/86
6/ 9/87
9/15/87
48
-------
EXHIBIT V
3 of 5
Final
Report
70234
79026
70777
71246
70123
71114
71113
70054
70317
70198
70303
70097
79000
71105
70397
71144
71677
70376
70758
70074
70484
71146
71017
70150
71615
70291
70212
70562
70264
70302
70844
71519
SUPERFUND AUDIT REPORTS
ISSUED DURING FISCAL 1987
CONTRACT AUDITS
Auditee
BELPAR CHEMICAL SERVICES INC
BBS ENVIRONMENTAL SPEC-PA
EVER ENVIRONMENTAL INC.
CH2M HILL INC. CORVALLIS OR
CH2M HILL, CORVALLIS, OR
CH2M HILL, INC., CORVALLIS, OR
CH2M HILL, INC., CORVALLIS, OR
CLEAN HARBOR, INC., MA
CLEAN HARBORS INC., MA
CMC INC NICHOLASVTLLE KY
CMC INC NICHOLASV1LLE KY
E. GILARDE CONSTRUCTION CO-PA
EARTH INDUSTRIAL WASTE MGT, TN
ENV SCIENCE & ENG FL
ENVIRON EMERGENCY SERVICES)
ENVIRONMENTAL EMERG. SERVICES
ENVIRONMENTAL EMERG. SERVICES
ENVIRONMENTAL EMERGENCY SER.
ENVIRONMENTAL SERV.
ENVIRONMENTAL TECH-NY
ENVTL MGMT CONTROL OH
ESPEY, HUSTON
FERGUSON HARBOR SERV. INC., TN
FERGUSON HARBOR SERVICE, TN.
GARD INC NILES IL
GSX SERVICESJNC NC
GUARDIAN CONSTRUCTION CO
GUARDIAN CONSTRUCTION CO. INC.
HAZTECH INC DECATUR GA - PEI
HAZTECH INC DECATUR GEORGIA
HAZTECH INC, DECATUR, GA
HAZTECH INC, DECATUR, GA
Audit
Control
Number
E9AT6030299
D9AT7050433
E9AT7030068
E9AT7100081
E9AT7100001
P9BT6100085
P9DT6 100072
E9AT6010241
E9AT6010214
E9AT6040306
E9AT7040051
E9AT6030298
D9AT6050312
D9AT7100075
E9CT6100051
E9CT6100083
E9CT7100011
E9CT6100017
E9CT6100097
D9AT6050315
D9AT7100030
E9DT7060106
E9AT7040119
E9AT6040304
D9AT7050669
E9AT6040322
E9AT6030292
E9AT7030067
E9AT6040305
E9AT7040052
E9AT7040099
P9AT7040208
Date
Report
Issued
11/6/86
7/16/87
2/20/87
5/29/87
10/22/86
4/29/87
4/29/87
10/10/86
11/20/86
10/31/86
11/19/86
10/17/86
10/27/86
4/27/87
12/12/86
5/4/87
8/10/87
2/9/86
2/18/87
10/15/86
11 5/87
5/4/87
4/8/87
10/27/86
7/30/87
11/17/86
11/4/86
1/15/87
11/12/86
11/19/86
3/ 9/87
7/15/87
49
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EXHIBIT V
4 of 5
SUPERFUND AUDIT REPORTS
ISSUED DURING FISCAL 1987
CONTRACT AUDITS
Final
Report
71018
70318
70828
70339
79001
71529
70786
70199
71019
70874
79015
70148
79017
71191
70468
79013
70057
70111
79006
79012
79002
70043
70058
79004
79007
70047
70138
70442
70476
71855
Auditee
HEMPHILL CONTRACT CO INC MO
INLAND POLLU. CONTROL, INC.,MA
INLAND POLLUTION CONTROL, MA
INLAND POLLUTION INC.
INLAND WATER POLL CONTROL MI
INLAND WATER POLL CONTROL-MI
rr CORPORATION CA
JET-LINE SERVICES, INC., MA
JOHN MATHES & ASSO INC MO
NEPCCO, CT
O. H. MATERIALS
OH MATERIALS
OH MATERIALS (AMBLER) OH
OH MATERIALS (DIOXIN RFP
OH MATERIALS (FY 84 ERCS)
OH MATERIALS (UNION CHEMICAL)
OH MATERIALS (ZONE 2)
OH MATERIALS (ZONE I)
OH MATERIALS IRON HORSE PARK
PEI (AMERICAN STEEL & DRUM),OH
PEI ASSOC (RASMUSSEN)
PEIASSOC(ZONE2)
PEI ASSOC ZONE 3
PEI ASSOCIATES (ENVIROCHEM)
PEI ASSOCIATES (MIDCO II) OH
PEI CINCINNATI OH CY 84
PETERSON MARITIME SERVICES
PRC ENVIRONMENTAL MGMT INC IL
PRC ENVIRONMENTAL MGMT INC IL
REXNORD INC EETC WI
Audit
Control
Number
D9AT7100069
E9AT6010216
E9AT7010054
E9AT6010215
D9AT6050318
D9AT7050380
D9AT7090107
E9AT6010217
D9AT7100070
E9AT7020058
E9CT6050147
E9AT6050319
E9CT6050146
E9AT7050343
E9BT7050011
E9CT6050143
E9AT6050277
E9AT6050279
E9CT5050117
E9CT5050317
E9CT5050219
E9AT6050278
E9AT6050280
E9CT5050316
E9CT6050273
E9DT5050218
E9AT6060216
D9AT7050131
D9AH7050209
D9AT7050774
Date
Report
Issued
4/9/87
11/20/86
3/4/87
11/26/86
10/27/86
7/16/87
2/24/87
10/31/86
4/ 9/87
3/12/87
2/18/87
10/24/86
2/20/87
5/14/87
12/30/86
21 5/87
10/10/86
10/21/86
1/12/87
1/23/87
11/3/86
10/7/86
10/10/86
1/5/87
1/13/87
10/ 8/86
10/23/86
12/22/86
1/2/87
9/ 9/87
50
-------
EXHTBTT V
5 of 5
SUPERFUND AUDIT REPORTS
ISSUED DURING FISCAL 1987
CONTRACT AUDITS
Final
Report
Number Auditee
Audit
Control
Number
70299 RIEDEL ENV. SERVICES, INC.
70398 RIEDEL ENVIRON SERVICES
70399 RIEDEL ENVIRON SERVICES
70871 RIEDEL ENVIRONMENTAL SERVICES
70390 ROLLINS ENVIRONMENTAL SVCS
70391 ROLLINS ENVIRONMENTAL SVCS
70145 SAMSEL SERVICES COMPANY
70048 SLC CONSULTANTS CONTRACTORS NY
71272 SLC CONSULTANTS NY
70477 SOUTHEAST ESTD CL SERV AL
71202 URS DALTON INC
70152 WILLMS CO INC, SC
E9AT6100087
E9CT6100040
E9DT6100059
E9AT7100039
D9AT6030295
D9AT6030296
D9AT7100010
D9AT6050317
D9AT7050434
D9AT6050313
D9AT7050519
D9AT6050311
Date
Report
Issued
11/18/86
12/12/86
12/12/86
3/11/87
12/11/86
12/11/86
10/24/86
10/8/86
6/3/87
1/2/87
5/19/87
10/27/86
51
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APPENDIX A
ACRONYMS AND ABBREVIATIONS
CERCLA Comprehensive Environmental Response,
Compensation, and Liability Act of 1980
CERCLIS Superfund Management Information System
CM Configuration Management
EDP Electronic Data Processing
EPA Environmental Protection Agency
ERCS Emergency Response Cleanup Services Contracts
FS Feasibility Studies
FTE's Full-time equivalents
HRS Hazardous Ranking System
LCM Life Cycle Management
LOG Letter of Credit
MAP Management Assistance Program
MENS Mission Element Needs Statement
MIS
National Contingency
Plan/or NCP
NPL
OA
OERR
OIG
Management Information System
National Oil and Hazardous Substances
Contingency Plan, 40 CFR Part 300
National Priorities List
EPA's Office of Audit
EPA's Office of Emergency and Remedial Response
EPA's Office of Inspector General
52
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OIRM EPA's Office of Information and Resources
Management
OSC On-Scene Coordinator
-------
OIRM
OSC
OSWER
OWPE
PA
PAO
PPAS
PRPs
QA/QC
RI/FS
RPM
SARA
SF-272
SI
TAT
Trust Fund
EPA's Office of Information and Resources
Management
On-Scene Coordinator
Office of Solid Waste and Emergency Response
Office of Waste Programs Enforcement
Preliminary Assessments
Property Accountable Officers
EPA's Personal Property Accounting System
Potential Responsible Parties
Quality Assurance/Quality Control
Remedial Investigations and Feasibility Studies
Remedial Project Managers
Superfund Amendments and Reauthorization Act
of 1986
Standard Form 272, Federal Cash Transaction
Report
Site Inspections
Technical Assistance Team Contractor
Hazardous Substance Superfund
53
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