UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
,, 'V OFFICE OF INSPECTOR GENERAL
NORTHERN DIVISION
10 W. JACKSON BLVD.. 4TH FLOOR
CHICAGO. ILLINOIS 6O6O4
OFFICE OF AUDIT
312/333*2486
OFFICE OF INVESTIGATION
312/333-2307
June 21, 1989
MEMORANDUM
SUBJECT:
Report Number E6FGG9-05-0272-9400033
Review of White House Referral-Oak Grove Sanitary
Landfill, Oak Grove, Minnesota
FROM:
TO:
Anthony C. Carrol lo
Divisional Inspector/General for Audits
Northern Division
Valdas V. Adamkus
Regional Administrator
Region 5
We have completed a special review of EPA Region 5, State of
Minnesota, and Anoka County actions affecting Oak Grove Sanitary
Landfill (OGSL). We performed this review in response to a March
20, 1989 referral from the White House Office's Director of
Agency Liaison, Presidential Correspondence. This referral
included a March 7, 1989 letter from Mr. Michael Egan, raising
several questions regarding actions taken by EPA, Minnesota and
Anoka County officials.
We accomplished our review by interviewing Regional, State, and
County officials and examining their records regarding actions
affecting OGSL. We also interviewed officials with International
Technology Corporation (IT), which performed studies and
conducted measuring and monitoring tests at OGSL for the
Minnesota Pollution Control Agency (MPCA). Finally, we discussed
the referral with members of the Egan family who own the property
on which OGSL is located.
The results of our review are discussed in this report. We
discussed our results, including recommendations, with Regional
officials who have responsibility for activity at OGSL. Their
comments and actions taken or planned are also discussed in this
report.
In addition, our review disclosed an internal control deficiency
regarding Region 5's procedures for sending letters to potential
responsible parties (PRP) demanding reimbursement for Agency
costs incurred in cleaning up Superfund sites. Regional Counsel
believed procedures for ensuring all PRPs receive the demand
letter could be strengthened by including a certified mail number
on each demand letter sent to PRPs. Regional Counsel explained
(990
MMQUMIEllSllMMir
WASHINGTON. D.C. 20460
-------
that this procedure would allow the Agency to more easily
determine the date that interest should start to accrue on
amounts in the demand letter. Regional Counsel also explained
that this procedure would allow EPA to more easily enter the
demand letter into evidence in a court of law.
We discussed this issue with a member of Region 5's Cost Recovery
Work Group. He stated this issue will be addressed in the next
meeting of the Work Group. We recommend the Regional
Administrator assure that the Work Group implements Regional
Counsel's suggestion.
In accordance with EPA Order 2750, the action official is
required to provide this office a written response to this report
within 90 days of the report date.
We have no objection to the further release of this report at
your discretion.
Background
OGSL occupies about 104 acres in Oak Grove Township, Anoka
County, Minnesota. The 1980 population census estimated that 249
people reside within one mile of the landfill and about 6,786
people reside within four miles. Minnesota environmental
officials estimate that the majority of houses in OGSL's vicinity
draw their water from wells or surface water sources.
OGSL began operations, in 1967, prior to Minnesota regulations
for maintaining and operating open dumps within the State. In
1971, Minnesota issued a permit to the Egan family to operate the
landfill. In 1976, a group of nine refuse haulers formed a
consortium to operate the landfill under the permit. EPA
estimated OGSL disposal operations received 200,000 to 300,000
cubic yards of waste per year. The consortium operated the
landfill until operations ceased in January 1984.
In May 1984, Minnesota environmental and health officials
initiated a surface and ground water monitoring program because
landfill monitoring installed by the owners and operators showed
the groundwater was contaminated with solvents, chemicals, and
metals. Minnesota officials also took the administrative steps
necessary-to place OGSL on EPA's National Priorities list (NPL).
OGSL qualified and in June 1986 was placed on the NPL which
represents the worst abandoned or uncontrolled hazardous waste
sites in the United States. Sites on the NPL are eligible under
the Comprehensive Environmental Response Compensation, and
Liability Act of 1980, commonly known as "Superfund", for long
-------
term remedial investigation and cleanup funds. Minnesota
environmental officials then entered into a cooperative agreement
with Region 5 to perform additional sampling at the site and
evaluate cleanup approaches.
Region 5 and the State of Minnesota approach to a cleanup
solution at OGSL resulted in two separate projects (operable
units): source control and mig-ation management. The first
operable unit addresses the source contamination by containing
on-site wastes and contaminated soils. The second operable unit
involves further study of the groundwater. Groundwater is an
important source of water in the area, and there are a number of
domestic wells in close proximity to the site.
On September 30, 1988, Region 5 issued a Record of Decision (ROD)
for the first operable unit which explains the Agency's decision
for addressing source contamination by containing the on-site
wastes and contaminated soils. This ROD requires a cover system
for the landfill with the purpose of containing site wastes and
contaminated soils. The estimated cost for this action is
between $5 and 10 million. The second operable unit is expected
to be issued in late 1989.
Distribution:
Inspector General
Regional Administrator, Region 5
Director, Office of Public Affairs (5PA)
-------
FINDING NO. 1 -
FINDINGS AND RECOMMENDATIONS
Region 5 Needs To Correct Demand For Payment
Letter To Potential ResponsibleParties.
Region 5 sent a "Demand of Payment of Site Costs" (demand letter)
to 13 potential responsible parties (PRPs) on February 7, 1989,
that contained errors due to the improper preparation and review
of the Region's Cumulative Cost Summary. As a result, Region 5
demanded the 13 PRPs pay $1,287,614.91 for response costs
incurred by EPA on OGSL through September 10, 1988 when actual
total costs incurred were $765,406.91. Unless the Region
maintains accurate accounting records, cost recovery actions
against PRPs could be impeded.
One of the Agency's primary goals in the Superfund program is to
maximize, through enforcement and administrative actions,
reimbursement of the Trust Fund for cleanup costs EPA has
incurred to cleanup hazardous waste sites. In order to pursue a
Superfund cost recovery action against a responsible party, the .
Agency's "Superfund Financial Management and Recordkeeping
Guidance For Federal Agencies" explains the government generally
must be able to show, from a cost documentation standpoint, that
the government:
1. Did work at the site to remedy or prevent a release of a
hazardous substance; and
2. Can accurately document the cost of the remedy or
prevention.
EPA pursues a cost recovery by sending demand letters to PRPs to
recover cleanup costs from owners and operators of sites and
generators and transporters who contributed hazardous substances
to sites. The demand letter advises the PRPs of the cleanup
costs incurred by EPA and requests payment be made to EPA's
Hazardous Substances Superfund which is administered by EPA.
In February 1989, Region 5 acted to compel PRPs to reimburse EPA
for cleanup costs at OGSL. The Region sent a demand letter for
$1,287,614.91 to 13 PRPs, including the owners and operators,
generators and transporters who contributed to the presence of
hazardous waste at OGSL. The $1,287,614.91 represented EPA
cleanup costs at OGSL through September 1988 and were compiled by
Region S's Superfund Accounting Section.
The error in Region S's demand letter to PRPs occurred because an
employee in Region 5's Superfund Accounting Section did not
correctly summarize payments to MPCA, under a cooperative
agreement, for a State lead remedial investigation/feasibility
study (RI/FS). Under the original cooperative agreement, Region
5 granted MPCA $165,200 to perform an RI/FS. According to
-------
Regional accounting officials, an accounting employee made a
typographical error and reported this grant to MPCA as $1,165,200
on OGSL's Cumulative Cost Summary which is used to prepare the
demand letter. Region 5's demand letter to PRPs subsequently
reflected this error.
In May 1989, based on our inquiry of this incident, accounting
employees reviewed OGSL's accounting records and found that
OGSL's Cumulative Cost Summary and demand letter did not include
other Region 5 payments to MPCA for additional site cleanup
costs. These payments, totalling $477,792, were also made under
a cooperative agreement with MPCA.
Regional accounting officials explained that the $477,792 in
other cleanup costs were not included in the Region's demand
letter because a Superfund accounting employee could not obtain
detail costs needed to prepare OGSL's Cumulative Cost Summary.
Although total costs for OGSL are included in the Region's
financial tracking system, the detail cost documents are in other
Regional files. At the time Regional accounting employees
prepared the Cumulative Cost Summary, the cost documents were not
available. A subsequent search of the files showed the necessary
documents were present. Consequently, the Region did not include
the $477,792 in the "Cumulative Cost Summary" and the amount was
omitted from the Region's February 7, 1989 demand letter.
As a result of this incident Regional accounting officials
reviewed 12 other demand letters issued since January 1989 for
other clerical errors. They advised us that this review did not
disclose any additional clerical errors in other demand letters.
Regional accounting officials explained that these types of
errors should not occur when the Region's cost documentation
tracking system is fully automated within the next several
months. The system will automate all portions of accounting for
site costs which should eliminate typographical errors. In
addition, there will be a reconciliation between the Region's
General Ledger and supporting ledgers which will help eliminate
inadvertent omission of cleanup costs. However, in instances
where the Region's accounting system indicates cost documentation
is not available, accounting officials have instructed employees
to review the appropriate cost documentation file to ensure the
accuracy of the tracking system.
Regional accounting officials and Superfund officials also acted
promptly to prepare a corrected demand letter to the 13 PRPs.
The corrected demand letter showing costs of $765,406.91 was
calculated as follow:
-------
Original Demand Letter
Less: Typographical error
Add: Other Cleanup Cost
not included in the
original demand letter
Corrected demand amount
Recommendation
$1,287,614.91
(1,000,000.00)
477,792.00
$765,406.91
At the conclusion of our review, we received a copy of the
corrected demand letter sent to the PRPs. No further action is
required.
-------
FINDING NO. 2 -
Quality Assurance Issues
Need Resolution
Minnesota's Pollution Control Agency (MPCA) has not resolved all
quality assurance issues from 1987 on a contractor's monitoring
and measurement data for OGSL because MPCA's contractor did not
deliver its data to MPCA timely for review. The contractor also
did not alert MPCA staff of problems encountered during its work
at OGSL. As a consequence, if data remains flawed, faulty
decisions addressing groundwater at OGSL can result, which can
harm public health, the environment and the economy.
We discussed this issue with Regional officials. They will take
steps to ensure MPCA timely resolves quality assurance issues
prior to their decision addressing groundwater contamination at
OGSL.
EPA policy requires a written quality assurance project plan
(QAPP) for projects having monitoring or measurement activity. A
QAPP ensures that monitoring and measurement data activities are •
conducted in a cost effective manner and properly characterizes
the extent of contamination at a hazardous waste site. A QAPP
describes the procedures for the collection of monitoring and
measurement data including quality assurance and quality control
activities necessary to achieve data quality goals. A QAPP helps
assure that Agency decisions are based on data that is precise,
accurate, complete, and representative of the conditions being
measured. Accordingly, Agency directives explain that if
Superfund employees have reason to suspect that sampling
activities are being conducted incorrectly, they should contact
EPA's quality assurance staff for support or consultation.
Region 5 has procedures to (1) assure that QAPPs are prepared for
specific projects and other continuing Regional operations and
(2) assess the precision and accuracy of monitoring and
measurement data. For example. Region 5's Waste Management
Division (WMD), responsible for Superfund activities, and the
Environmental Services Division, (ESD), responsible for
establishment and approval of quality assurance programs, have a
Memorandum of Agreement (MOA) regarding Superfund activities.
The MOA reiterates the Agency's policy that a QAPP shall be
approved prior to sample collection and analysis. Both divisions
are responsible for the technical content of a QAPP which will
ensure an accurate and cost effective remedial investigation.
At OGSL, MPCA has cleanup responsibility under a cooperative
agreement with Region 5. MPCA hired a contractor to prepare a
QAPP for OGSL, in accordance with Region 5's quality assurance
procedures. Region 5 approved the QAPP in October 1986. The
stated purpose of OGSL's QAPP was to help assure that monitoring
-------
and measurement activities at OGSL would properly characterize
the waste, geology, and hydrogeology in the vicinity of the
landfill and evaluate the impacts of the landfill on the
environment.
In October 1985, MPCA arranged with the contractor to perform a
remedial investigation and report for OGSL. The contractor,
however, did not adequately complete its activities, or prepare a
satisfactory report. In a September 3, 1987 letter to the
contractor, with a copy to Region 5, an MPCA Superfund official
stated:
MPCA staff does not believe the quality of the report
meets our expectations. This is due in part to the
fact that there has not been enough data collected but
we also believe that the analysis provided has not
demonstrated the sophistication or completeness we
should expect.... The draft RI does not adequately
discuss the procedures used while conducting the
remedial investigation, does not present complete data
sets, does not adequately discuss problems with the
data nor provide complete interpretations, comparisons,
and conclusions of the data.
At the time Region 5 issued its first ROD on September 30, 1988,
MPCA had not addressed the problems with the contractor's work
because the contractor delayed delivery of additional data to
MPCA until September 7, 1988. As a result, the MPCA quality
assurance officer's review of this data was delayed because he
had to postpone a joint MPCA/EPA review of the data and because
he had other project commitments.
Regional Superfund officials explained that the delay in
resolving problems with the contractor's work did not affect
their September 30, 1988 ROD which required a cover system to
contain site wastes and contaminated soils. The cover system met
the requirements in the Resource Conservation and Recovery Act
(RCRA) for closing municipal landfills containing mixed wastes.
Superfund requires that cleanup actions meet the requirements in
RCRA and other applicable, relevant and appropriate state and
federal regulations.
The MPCA quality assurance officer completed a review of the
contractor's data in January 1989. In a January 5, 1989 letter
to the MPCA project manager responsible for OGSL, the quality
assurance officer stated there had been substantial non-
conformance by the contractor on the project and expressed
continuing reservations regarding some of the data. These
reservations included:
-------
0 Failures by field or laboratory staff in field/laboratory
activities, apparent lack of effort by the contractor's
laboratory staff which may have affected the quality or
integrity of the data generated by the Rl, and the lack of
timely notification by the contractor's staff responsible
for notifying the MPCA of such non-conformances.
In addition, the letter raised concerns about the holding times
on the laboratory data. For example:
0 Thirteen cyanide samples were found to have been incorrectly
preserved, and sixteen mercury samples were not analyzed
within the prescribed holding time.
0 Fourteen water samples exceeded the seven day holding time
recommendations.
0 Five pesticide extracts were analyzed beyond specified
holding times.
We, discussed this issue with Region 5's Remedial Project Manager
(RPM) who has responsibility for OGSL. He advised us that he is
aware of the data deficiencies and that the data need refinement.
He explained that MPCA's contractor for the second operable unit
is to perform the sampling and analysis necessary to refine the
data which will determine the extent of groundwater
contamination. The RPM did not contact ESD because he believed
the data are not needed to support the ROD's actions addressing
source contamination.
EPA policy, implemented by Region 5 through its MOA between ESD
and WMD, states that issues over data quality can be more quickly
resolved by coordination between the two divisions. RPMs can
obtain technical support for overseeing field activities from
ESD. The directive cited that a common problem, which causes
project delays during field activities, is poor technical
performance by contractors.
We also discussed this incident with ESD officials. These
officials explained that had they been aware of the deficiencies
they would have initiated steps with WMD to assist MPCA in
resolving the issues concerning the quality of data for OGSL.
Regional Superfund officials recognize that resolving the quality
of data issues is important. The Summary of Remedial Selection
accompanying the September 30, 1988, ROD states that "...it
should be noted that the data and hydrogeological results
presented here are preliminary and will be subjected to further
refinement during the migration management operable unit RI/FS."
The ROD stated that some of the remaining tasks to be performed
include installation of additional monitoring wells, collection
and analysis of additional water samples and preparation of the
final remedial investigation report.
-------
We discussed this incident with MPCA, Regional Superfund and BSD
officials. MPCA officials advised us that they hired another
contractor to perform the remaining tasks. Regional Superfund
officials stated they will ensure MPCA prepares a quality
assurance report resolving these quality assurance issues. In
addition. Regional Superfund and BSD officials will, where
applicable, resolve deviations encountered in satisfying QAPP
requirements for OGSL's second operable unit. We agree with
these actions which should ensure that a decision on the
groundwater at OGSL is based on data that is precise, accurate
and complete.
Recommendation
We recommend the Regional Administrator ensure the actions
planned by Superfund and BSD officials are accomplished. We
request that he provide us the documentation necessary to show
quality assurance issues are resolved.
10
•v".<*.T;i KM-
------- |