&EPA
United States
Environmental Protection
Agency
0«ice of
Soi«d Waste ana
Emergency Response
DIRECTIVE NUMBER.
9375.1-4-U
TITLE: STATE PARTICIPATION IN THE SUPERFUND PROGRAM,
- Volume 1, Appendix U: Cost Documentation
Requirements for Cooperative Agreements
September 11, 1986
September 11, 1986
OERR/HSCD/SRCB
APPROVAL DATE:
EFFECTIVE DATE:
ORIGINATING OFFICE:
>E FINAL
D DRAFT
STATUS:
REFERENCE (other documents):
9375.1-4 STATE PARTICIPATION IN THE SUPERFUND PROGRAM,
Volume 1
OSWER OSWER OSWER
VE DIRECTIVE DIRECTIVE Dl
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^ _ _
OtPA
United Stales Environmental Protection Agency
Washington, DC 20460
OSWER Directive Initiation Reauest
1. Directive Number
9375.1-04-
2. Originator Information
Name of Contact Person
Deborah Swichkow
Mail Code
WH-548-E
Office
OERR/HSCD/SRCB
Telephone Number
(202) 382 2453
3. Title
STATE PARTICIPATION IN THE SUPERFUND PROGRAM, Volume 1, Appendix U: Cost
Documentation Requirements for Superfund Cooperative Agreements
4. Summary of Directive (Include brief statement of purpose)
Provides guidance to Remedial Project Managers (RPM) and State Project Officers (SRO) in
their efforts to catalog, file, and maintain documentation of response costs incurred by
States during State-lead response.
5. Keywords Superfund, CERCLA, State participation, cooperative agreements, cost
documentation, cost recovery
6a. Does this Directive Supersede Previous Directive^)? _ | Yes |Xt No What directive (number, title)
b. Does It Supplement Previous Directive^)? 0 Yes Q No What Directive (number, title)
9375.1-4 State Participation in the Superfund Program, Volume 1
.. Draft Level
LJ A Signed by AA/DAA LJ B Signed by Office Director Lj C
For Review & Comment
LJ In
Development
'his Request Meets OSWER Directives System Format
8. Signature of Lead Office Directives Coordinator
-/?. <:
Date
1. Name and Title of Approving Official
Henry L. Longest II, Director, OERR
Date
9/11/86
OS WER OS WER OS WER
DIRECTIVE DIRECTIVE .
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
SB> I I 1986
OFFICE OF
SOLID WASTE AND EMERGENCY RESPONSE
MEMORANDUM
I !! III I
SUBJECT: Addendum to the Manual State Participation in the
Superfund Program: Appendix U, "Cost Documentation
Requirements for Superfund Cooperative Agreements"
FROM: Henry L. Longest II
Director
Office of Emergency and Remedial Respo
TO: Mailing List
Attached is Appendix U, "Cost Documentation Requirements for
Superfund Cooperative Agreements", to be added to the State
Participation manual as a new addendum. This Appendix provides
guidance to Regional and State personnel in their efforts to
catalog, file, and maintain documentation of response costs
incurred by the State during response. It is drawn from General
Regulation for Assistance Programs (40 CFR Part 30), Procurement
Under Assistance Agreements (40 CFR Part 33), and supplemented by
the EPA Grants Administration Division's (GAD) Assistance Admini-
stration Manual (December 1984).
Appendix U of the State Participation manual was developed
in consultation with EPA's Office of General Counsel (OGC), Grants
Administration Division (GAD), the Office of Waste Program
Enforcement (OWPE), and the Office of Enforcement and Compliance
Monitoring (OECM).
A draft was distributed for comment on March 12, 1986, to
Headquarters, Regional Offices, and to the Association of State
and Territorial Solid Waste Management Officials (ASTSWMO).
Comments on that dra-ft as well as program experiences to date are
reflected in this addendum. A discussion of the substantive
changes and clarifications to the draft follows.
Generally, the Superfund program does not differ in substance
from the Agency's requirements stipulated in 40 CFR 30 and 33.
It embraces current Agency requirements with the major addition
that accounting and record keeping conducted 'during Superfund
response are detailed on a site specific basis to ensure cost
recovery. For this reason, the text and the exhibits were struc-
tured in a manner that clearly presents both the application of
EPA requirements to Superfund and those requirements specific to
Superfund for cost documentation purposes.
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- 2 -
Most of the comments were relevant and were subsequently
incorporated in the document. One of the more problematic
references identified by the commentors in the text were
discrepancies in documenting pre-remedial activities on a site-
specific basis. Due to the number of comments on pre-remedial
cost accounting practices, a third section in the text was added
that defines Superfund pre-remedial requirements.
Respondents' comments also prompted clarification of State
record retention guidance, specifically pertaining to the 3-year
record retention requirements. In keeping with the 40 CFR 30
requirements, State records must be retained for 3 years beyond
the end of the project period, unless audit, litigation(ietc.,
is on-going. Under the latter condition, all records must be
retained for 3 years after conclusion of the audit, litigation,
(including Superfund enforcement actions), etc.
There were numerous concerns that the retention of documen-
tation in a centralized file by site could not be properly monitored
or accessed. This Appendix now suggests that all files for a
particular site be cataloged in the same manner to improve
accessibility/monitoring. It was suggested that a cross reference
directory identifying multiple files for the same site be developed
to further improve accessibility.
The text also underwent significant modifications responding
to commenters1 uncertainties concerning the use of microfilm in
the Superfund program. This section now states that the substitu-
tion of original documentation by microfilm is allowable. All
documents should be filmed and maintained according to EPA
specifications (EPA order 2160) and National Archives and Records
Administration (36 CFR 1230) requirements.
Appendix U reflects current Agency guidance pertaining to
cost documentation requirements under cooperative agreements. As
such, it should be considered a new addendum and be Integrated
into the State Participation manual.
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TABLE OF CONTENTS
9375.1-4
PAGE
LIST OF ACRONYMS AND ABBREVIATIONS a
I. INTRODUCTION 1-1
A. Purpose of the Manual 1-2
B. Background Key Terms 1-3
B.I Remedial Response 1-4
B.2 Remedial Response Agreements 1-4
B.3 State Assurances 1-5
B.3.a Cost-Sharing 1-5
B.3.D Off-Site Treatment, Storage, 1-6
or Disposal
B.3.c Operation and Maintenance (O&M) 1-7
B.4 State Credits 1-7
C. Overview of the Manual 1-7
II. CONCURRENT ADMINISTRATIVE EVENTS II-l
A. Initiation of Enforcement Activities II-2
B. Initiation of Forward Planning II-2
C. Development of Site-Specific Schedules II-5
D. Development of the Remedial II-5
Accomplishments Plan (RAP)
E. Development of the Action Memorandum II-5
F. Identification and Review of State . II-6
Credit Submissions
G. Intergovernmental Review II-7
III. DEVELOPMENT OF COOPERATIVE AGREEMENT III-l
APPLICATION PACKAGES
A. Completion of the Cooperative Agreement III-2
Application Form
DATE
12/10/84
12/10/84
Xlll
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9375.1-4
PAGE DATE
A.I Part IV - Project Narrative III-2
Statement
i
A.2 Part III - Project Budget III-3
A.2.a Allowable Costs III-4
A.2.b Enforcement Costs III-5
A.2.C Calculation of State Cost Share III-5
B. Development of Cooperative Agreement III-6
Provisions
B.I General Assistance Requirements III-6
B.2 Superfund Program Requirements III-7
B.2.a Provision of CERCLA III-8
Section 104(c)(3) Assurances
B.2.b The National Environmental III-9
Policy Act of 1969 (NEPA)
B.2.C Quality Assurance/Quality 111-10
Control (QA/QC)
B.2.d Site Safety Plan III-ll
B.2.e Expedited Procurement 111-12
C. Completion of the Procurement System 111-12
Certification Form
D. Other Submissions 111-13
D.I Community Relations Plan (CRP) 111-13
D.I.a Draft Community Relations 111-13
Plan
D.l.b Complete Community 111-14
Relations Plan
D.2 Certification Letter 111-15
D.3 Intergovernmental Review Comments 111-15
E. Deviation Requests to Permit the 111-15
Allowability of Pre-Award Costs
F. Multi-Site Cooperative Agreements 111-17 12/10/84
F.I Activities That May Be Included 111-18
in Multi-Site Cooperative
Agreements
F.2 Intergovernmental Review 111-19
F.3 Contents of a Multi-Site Cooperative 111-20
Agreement
xiv
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9375.1-4
IV.
F.3.a Cooperative Agreement
Application Form
F.3.b Multi-Site Cooperative
Agreement Application
Provisions
F.3.C Procurement System
Certification Form
F.3.d Certification and
Enforcement Letters
F.4 Accounting for Multi-Site
Cooperative Agreements
F.5 Administration of Multi-Site
Cooperative Agreements
F.5. a Project Management
F.S.b Project/Budget Periods
F.S.c Quarterly Reports
\
DEVELOPMENT OF EPA-LEAD REMEDIAL PLANNING
AGREEMENTS
A. The Scope of Work for Remedial Planning
B. Documentation of Terms and
Responsibilities
B.I EPA Responsibilities
B.2 State Responsibilities
B.3 General Terms ,
C. Other Submissions
C.I Community Relations Plan (CRP)
C.2 Intergovernmental Review Comments
D. Management Assistance Cooperative
Agreements
V. DEVELOPMENT OF SUPERFUND STATE CONTRACTS
A. Development of the Statement of Work (SOW)
B. Development of State Cost-Sharing Terms
B.I Calculation of the State's Cost Share
B.2 Negotiation of Payment Terms
C. Documentation of Other Terms and
Responsibilities
PAGE DATE
111-20
111-23
111-23
111-23
111-24
111-26
111-26
111-26
111-27
IV-1
IV-3
IV-3
IV-3
IV-4
IV-4
IV-5
IV-5
IV-6
IV-6 12/10/84
V-l
V-2
V-2
V-2
V-3
V-4
xv
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9375.1-4
C.I EPA Responsibilities
C.2 State Responsibilities
C.3 General Terms ,
D. Other Submissions
D.I Community Relations Plan (CRP)
D.2 Certification Letter
D.3 Intergovernmental Review Comments
E. Multi-Site Superfund State Contracts
PAGE DATE
V-4
V-5
V-6
V-7
V-7
V-8
V-8
V-8 12/10/84
VI. EXECUTION OF REMEDIAL AGREEMENTS VI-1
A. Review of the Draft Agreement VI-1
A.I Review of the Draft Cooperative VI-2
Agreement Application Package
A.2 Review of the Draft EPA-Lead VI-2
Submission
B. Final Regional Review and Preparation VI-2
of the Concurrence Package
C. Approval and Execution VI-4
VII. ADMINISTRATION OF REMEDIAL AGREEMENTS ' VII-1
A. Monitoring Financial Commitments VII-1
A.I State Drawdowns Under a Cooperative VII-2
Agreement
A.2 State Payment of Cost Share Under VII-3
a Superfund State Contract
B. Monitoring Technical Commitments VII-3
B.I Monitoring Site Activities VII-4
B.2 Monitoring State Assurances and VII-5
Compliance with Special Conditions
C. Coordinating EPA-Lead Remedial Agreements VII-5
with Performance Agreements
D. Documenting Remedial Activity VII-6
xvi
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9375.1-4
E.
D.I Regional Files
D.2 EPA Headquarters Files
D.3 State Files
Documenting Completion of Remedial
Implementation [RESERVED]
VIII. AGREEMENT MODIFICATIONS
A. Project Adjustments
A.I Adjustments to State-Lead Projects
A.2 Adjustments to EPA-Lead Projects
B. Initiation of Remedial Design and
Remedial Action
B.I Records of Decision (RODs)
B.2 Incorporating Remedial Design and
Remedial Action into an
Agreement Between EPA and the State
C. Initiation of Operation "and Maintenance
IX. AUDITS OF COOPERATIVE AGREEMENTS
A. Types of Audits
A.I Interim Audits
A.2 Final Audits
A.3 CERCLA Credit Audits
B. Scheduling the Audit and Preliminary
Activities
B.I Scheduling the Audit
B.2 Regional Preparation for the Audit
B.3 State Preparation for the Audit
C. Procedures for the Audit
C.I Entrance Conference
C.2 Audit Standards and Tasks
C.3 Draft Audit Report
C.4 Exit Conference
C.5 Final Audit Report
C.6 Findings and Recommendations Related
to EPA Administration
PAGE
VII-6
VII-6
VII-7
DATE
VIII-1
VIII-1
VIII-1
VIII-2
VIII-3
VIII-3
VIII-6
VIII-7
IX-1 3/20/86
IX-3
IX-3
IX-6
IX-7
IX-7
IX-8
IX-8
IX-10
IX-11
IX-11
IX-13
IX-15
IX-18
IX-19
IX-19
xv 11
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9375.1-4
D. Resolution of Audit Findings and Follow-up
Actions
t
D.I Review of Final Audit Report and
Resolution of State Disagreements
D.2 Resolution of DIGA Disagreements
and Disputes
D.3 Issuance of the Final Determination
Letter
D.4 Review for Adequacy
E. Implementation of Corrective Actions
APPENDICES
Introduction to the Appendices
Appendix A - PA/SI Guidance
Action Memorandum Guidance
PAGE
IX-20
IX-20
IX-21
IX-22
IX-23
IX-23
DATE
Appendix B -
Appendix C -
Appendix D -
Appendix E -
Appendix F -
Appendix G -
Appendix H -
Appendix I -
Appendix J -
Documenting CERCLA State Credits and
Advance Match
A-l
B-l
C-l
Procedures for Implementing Intergovern- D-l
mental Review
Model Statement of Work for State-lead E-l
Remedial Investigation/Feasibility Study
Projects
Sample Cooperative Agreement Application F-l
Provisions
Sample Cooperative Agreement Application G-l
Package
Sample Articles for Superfund State H-l
Contracts and Other EPA-Lead Remedial
Agreements
Sample Superfund State Contract 1-1
Sample Certification Letters J-l
9/17/85
12/20/85
5/2/86
9/17/85
12/20/85
7/22/86
12/10/84
xvi 11
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9375.1-4
Appendix K -
Appendix L -
Appendix M -
Appendix N -
Appendix 0 -
Appendix P -
Appendix Q -
Appendix R -
Appendix S -
Appendix T -
Kppendix U -
Sample Community Relations Plan Format
and Sample Plan (CRP)
Sample Quality Assurance/Quality Control
Plan
Sample Site Safety Plan
How to Obligate CERCLA Funds for State-
and Federal-lead Response
Record of Decision (ROD)/Enforcement
Decision Document (EDO) Guidance
Superfund Supplement Guidance
Glossary of Terms
List of References
Advance Match Procedures
Obtaining Equipment for Use Under
a CERCLA Cooperative Agreement
Cost Documentation Requirements for
Superfund Cooperative Agreements
K-l 3/24/86
L-l 1/31/86
M-l 12/20/85
N-l 8/22/86
0-1 1/17/86
P-l 3/5/86
Q-l
R-l
S-l 1/4/85
T-l 8/9/85
U-l 9/11/86
xix
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9375.1-4
LIST OF EXHIBITS
Exhibit
Number TITLE
-- i
1-1 Site Chronology
1-2 Document Outline
II-l Concurrent Administrative Events
II-2 Sample SOW for State-Lead Forward Planning
Activities
III-l Development of Cooperative Agreement Application
Packages
III-2 Cooperative Agreement Application Package
Checklist
111-17 Figures for Use in Estimating Total State-Lead
Remedial Action Costs
III-4 Object Class Categories for Use in Completing
the Cooperative Agreement Application.
III-5 Itemization of Object Class Categories:
Appropriate Level of Detail
III-6 State Cost-Share Calculations
III-7 Summary of Requirements for Procurement Under
Assistance Agreements (40 CFR 1717)
III-8 Summary of Superfund Program Provisions for
Cooperative Agreement Applications
III-9 Methods for Expediting Procurement
111-10 Examples of Options for Awarding and Managing
Multi-Site Cooperative Agreements
III-ll Sample MSCA Obligation Document
IV-1 Development of Memoranda of Understanding
V-l Development of Superfund State Contracts
xx
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9375.1-4
LIST OF EXHIBITS
Exhibit
Number TITLE
j
V-2 Figures for Use in Estimating Total EPA-Lead
Remedial Action Costs
V-17 State Cost-Share Calculations
VI-1 Execution of Remedial Agreements
VI-2 Agreement Review and Approval Process
VI-17 Suggested Format for the Decision Memorandum
VII-1 Administration of Remedial Agreements
VIII-1 Agreement Modifications
IX-1 Audits of Cooperative Agreements
IX-2 Listing of Offices of the Divisional Inspectors
General for Audits
Wx-3 Cooperative Agreement Audit Process
IX-4 Sample Cost Exhibit for Draft Audit Report
A-l Pre-Remedial Screening Process
A-2 CERCLA Information System (CERCLIS)
A-17 Application For Federal Assistance, Part III
Table 1 Sample Format for Pre-Remedial Program Report
Table 2 Sample Format for Work Hours Per Site (Pre-Remedial)
Table 17 Sample Format for Expense Report (Pre-Remedial)
Table 4 Sample Format for Site Additions and Substitutions
(Pre-Remedial)
Table 5 Revised Schedule of Pre-Remedial Accomplishments
C-l Application of Credit on Cooperative Agreement Application
Budget Sheets: Part III, Sections A and B Schedule A
xxi
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9375.1-4
LIST OF EXHIBITS
Exhibit
Number TITLE
C-2 Application of Credit on Cooperative Agreement Application
Budget Sheets: Part III, Section B Schedule B
C-3 Application of Credit on Cooperative Agreement Application
Budget Sheets: Part III, Sections C, D, E and F
C-4 Application of Advance Match on Cooperative Agreement
Application Budget Sheets: Part III, Sections A and B
Schedule B
C-5 Application of Advance Match on Cooperative Agreement
Application Budget Sheets: Part III, Section B Schedule B
N-l Superfund Accounting Example
N-2 Single-Site Award
N-3 MSCA Award
N-4 Single-site Transfer
N-5 MSCA Transfer
N-6 Advance Match Award
N-7 State Credit Award
T-l Sample Usage Charge Calculation
T-2 Accounting Example
U-l Summary of Cost Documentation Requirements
U-2 Account Requirements for Personnel, Travel, Equipment,
Supply, and Indirect Costs
U-3 General EPA Accounting Requirements/Procedures Applicable to
Superfund
U-4 Procedures for Documenting Purchase and Use of CERCLA-funded
Equipment
U-5 Financial Tracking and Recordkeeping Requirements for
State-lead Superfund Activities
xxii
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9375.1-4-u
APPENDIX U
COST DOCUMENTATION REQUIREMENTS FOR SUPERFUND
COOPERATIVE AGREEMENTS
PURPOSE
This apppendix provides guidance to Remedial Project
Managers (RPMs) and State Project Officers (SPOs) in their
efforts to catalog, file, and maintain documentation of
response costs incurred by States during State-lead
response.
BACKGROUND
EPA's current Agency wide assistance requirements are
found in two primary sources:
General Regulation for Assistance Programs (40
CFR Part 30), which codifies State responsibili-
ties for managing and administering EPA-assisted
projects
Procurement Under Assistance Agreements (40 CFR
Part 33), which codifies EPA's requirements for
State procurement under assistance agreements.
These regulations are supplemented by the EPA Assistance
Administration Manual (December 1984)*, which outlines
policies and procedures that States and EPA must use in
managing the administrative aspects of EPA financial
assistance programs. Both 40 CFR Parts 30 and 33 apply to
the Superfund State-lead program.
Superfund program requirements do not differ in sub-
stance from Agency regulations on cost documentation and
recordkeeping. They embrace current Agency requirements
found in 40 CFR Parts 30 and 33, with the major additional
requirement that accounting and recordkeeping conducted
Contact EPA's Grants Policy and Procedures Branch,
Grants Administration Division, or, if copies are de-
sired, the National Technical Information Service
(publication number TB-85-4903199).
U-l
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9375.1-4-u
during response be detailed on a site-specific basis.
States are not required to document costs on a site-
specific basis for pre-remedial work (preliminary assess-
ment (PA) and site inspection (SI) activities). Estimates
of pre-remedial personnel hour expenditures must be re-
ported to EPA on a site-specific basis. States must track
and report all other expenditures by object class cate-
gory, however, as required under 40 CFR Part 30 (see Ap-
pendix A) .
Superfund requirements include documentation and
recordkeeping measures instituted to protect the integrity
of site data to ensure effective cost recovery. States
that enter into Cooperative Agreements should maintain
documentation that responds to such questions as what work
was authorized, what work was completed, what charges were
incurred for the work, and what payments were made for the
work. States also should agree to provide documentation
to support cost recovery litigation. Guidance on develop-
ment of EPA cost-recovery cases, and the types of documen-
tation necessary for them, are found in the following
sources:
RCRA/CERCLA Case Management Handbook (August 1984)
Cost Recovery Procedures Under CERCLA (August 26,
1983)
Procedures for Documenting Costs for CERCLA Sec-
tion 107 Actions (January 30, 1985).
Other sources also may be appropriate.
APPENDIX SUMMARY
This appendix describes the general Agency require-
ments for cost documentation and, where necessary, addi-
tional Superfund-specific requirements or procedures for
documenting State expenditure of CERCLA funds during re-
sponse. The appendix is presented in five sections:
Cost Accounting of State Expenditures, which re-
views the requirements that a State accounting
system must fulfill
State Recordkeeping Requirements, which summar-
izes general file and record requirements, in-
cluding the key documents that a State should
retain
U-2
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9375. 1-4-u
State Record Retention and Access to State Files,
which discusses time requirements for record re-
tention, access to State records by EPA and the
U.S. Department of Justice (DOJ), and related
subjects
Internal Controls for State Accounting Systems,
which summarizes procedures that States must have
in place to oversee accounting
Contractor Files, which describes the general
recordkeeping requirements for State contractors,
including the key documents that they should
retain.
Most sections are divided into two major subsections: one
that discusses general EPA requirements, and one that ex-
plains any additional Superfund-specific procedures. In
addition, where necessary, a third section defines
Superfund-specific pre-remedial requirements. Section 4,
Internal Controls for State Accounting Systems, does not
follow this convention because there are no specific re-
quirements in this area imposed by the Superfund program.
To allow convenient reference to existing Agency re-
quirements, Exhibit U-l, on the following pages, summar-
izes the contents of this appendix.
U-3
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9375.1-4-u
General EPA Requirements
EXHIBIT U-l
SUMMARY OF COST DOCUMENTATION REQUIREMENTS
Corresponding
Agency Citations
Requirements
Unique to Superfund
1.
G
I
Cost Accounting of State
Expenditures
Document all costs, includ-
ing costs of all subagree-
ments, by EPA Assistance
Agreement Identification
Number
Document indirect cost rate,
negotiated with cognizant
Federal agency, and method-
ology used
Develop accounting system
in accordance with require-
ments of 40 CFR Part 30
- Complete records of fi-
nancial actions
- Records showing source
and application of all
project funds
- Control over all project
funds and property
- Comparison of actual vs.
budgeted costs
40 CFR 30.510 and .540
Assistance Administration
Manual (AAM), Chapter 20.
1. Cost Accounting of State Expendi-
tures
Document all remedial costs
by site number and activity
code, including:
- Costs incurred during each
budget period for each site-
specific activity
- Costs incurred by personnel
supporting litigation
- Equipment costs and use
For pre-remedial costs. State
must document by Superfund
Account Number
Centralize overall fiscal re-
sponsibility for project funds
in a designated office; re-
sponsibility for individual
projects and funds should re-
side elsewhere, depending on
project/activity
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9375.1-4-u
EXHIBIT U-l
SUMMARY OF COST DOCUMENTATION REQUIREMENTS
Corresponding Requirements
General EPA Requirements Agency Citations Unique to Superfund
- Prompt disbursement of
Federal funds
- Procedures to determine
allowable, allocable, and
reasonable costs
- Audits of the system and
procedures to resolve find-
inqs
Incorporate generally recog-
nized accounting procedures
into system
- Establish cost center
- Record all transactions
in a timely manner
- Prepare monthly financial reports
Maintain accountinq records to
support all financial transac-
tions
- Cash receipts reqister
- General ledqer
- Cost control ledqer
- Voucher journal
- Payroll records
- Property cecords.
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9375.1-4-u
General EPA Requirements
EXHIBIT U-l
SUMMARY OF COST DOCUMENTATION REQUIREMENTS
Corresponding
Agency Citations
Requirements
Unique to Superfund
General State Recordkeeping
Requirements
Maintain official records
for each EPA assistance
agreement and identify them
by EPA Assistance Agreement
Identification Number
- Amount, source, and dis-
position of all project
funds, including Federal
monies, by object class
category
- Program income
- Non-expendable personal
property purchased as a
direct cost under the CA
- Time records and other sup-
porting data
Maintain records on contrac-
tor, if one -is being used to
conduct a project under a CA
- Bid and proposal records
- Contract delivery/work
orders, invoices, and pay-
ment vouchers
40 CFR 30.500, .510, and
.531
AAM, Chapter 19,
paragraph 2
State Participation in the
Superfund Program (SPSP)
40 CFR Part 30, Subparts
H, I, and L.
2. General State Recordkeeping
Requirements
Maintain records for pre-
remedial activities in one
pre-remedial file
Maintain all remedial records
on a site-specific basis and
identify records by site number
and activity code
Record personnel hours for
remedial activities on as
site-specific basis
Document equipment costs by
Superfund account number and
EPA Assistance Agreement
Identification Number
Document correspondence relating
to NPL deletion, if applicable.
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9375.1-4-u
EXHIBIT U-l
SUMMARY OF COST DOCUMENTATION REQUIREMENTS
Corresponding Requirements
General EPA Requirements Agency Citations Unique to Superfund
- Change orders issued to
a contractor by the State
- Subagreement documents
- Contractor progress reports
- Negotiated procurements and
documentation of negotia-
tions
- Cost and price analysis
records
Document non-compliance or
disputes relating to a CA
- EPA stop-work orders
- Suspension/termination
notices
- Correspondence concerning
disputes and appeals
- Final determinations
Maintain records concerning
agreement closeout and proj-
ect audits.
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9375.1-4-u
General EPA Requirements
EXHIBIT U-l
SUMMARY OF COST DOCUMENTATION REQUIREMENTS
Corresponding
Agency Citations
Requirements
Unique to Superfund
3.
G
I
oo
State Record Retention and
Access to State Files
Retain records for three
years from end of project
unless audit, litigation, cost
recovery, and/or any dis-
putes are initiated before
the end of the three-year
retention period
All records are subject to
audit/inspection and
transfer/disclosure of
information
Allow EPA and any authorized
representatives access to all
records
Allow microfilm to be sub-
stituted for original hard
copy.
40 CFR 30.501 and .502
AAM, Chapter 19, paragraph 2
SPSP
3. State Record Retention and Ac-
cess to State Files
Retain records for three years
from the date of the final
Financial Status Report, or
until any audit, litigation,
cost recovery, and/or any
disputes initiated before the
end of the three-year retention
period are settled, whichever
is longer
Provide EPA/DOJ access to
specific project files
Provide EPA/DOJ with originals or
copies of specific documentation,
as requested
Microform copies may be substituted
for original EPA assistance-related
documents in active files without
EPA approval; all microform copying
must be done in accordance with
prescribed technical requirements
and subject to EPA quality assur-
ance/quality control
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9375.1-4-u
General EPA Requirements
EXHIBIT U-l
SUMMARY OF COST DOCUMENTATION REQUIREMENTS
Corresponding
Agency Citations
Requirements
Unique to Superfund
a
i
Internal Controls for State
Accounting Systems
Develop internal controls
- Staff training
- Methods of authorization,
recordkeeping, and trans-
action coding
- Procedures for expen-
diture control
- Property safeguards.
40 CFR 30.510 and
AAM, Chapter 20,
paragraph 3.
.531
Notify EPA and coordinate with
the State Attorney General when
third-party searches are
requested.
4. Internal Controls for State Ac-
counting Systems
No additions specific to Super-
fund.
5. Contractor Records
Contractors must retain all
records in accordance with
Agency procedures (40 CFR
Parts 30 and 33); must in-
clude:
- Bid records
- Contract delivery/work
orders, invoices, and
vouchers
- Change orders issued by
the State
40 CFR 30.500(b), 33.275,
33.290, and 33.1030-9
AAM, Chapter 19, paragraph
1-b, and Chapter 20, para-
graph 1-b.
Contractor Records
Contractors must maintain rec-
ords by site-specific project
for three years from closeout
of sub-agreement, unless audit,
litigation, cost recovery, and/
or any disputes are initiated
before the end of the three-
year retention period
Contractors must provide expert
testimony/witnesses and infor-
mation, upon request by EPA.
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9375.1-4-u
EXHIBIT U-l
SUMMARY OP COST DOCUMENTATION REQUIREMENTS
Corresponding Requirements
General EPA Requirements Agency Citations Unique to Superfund
- Progress reports
- Stop-work orders
- Documentation concerning
disputes/claims
Contractors must retain
similar records for all
subcontractors
- Accounting records in
accordance with gen-
erally accepted ac-
counting practices
Financial information and
data used in preparation or
support of cost submissions
required under 40 CFR 33.290.
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9375.1-4-u
1. COST ACCOUNTING OF STATE EXPENDITURES
EPA regulation (40 CFR 30.501) directs a State operat-
ing under an EPA assistance agreement to maintain an ac-
counting system that fulfills specific Agency require-
ments. This pertains to CERCLA Cooperative Agreements.
Requirements in 40 CFR Part 30 and in Chapters 19 and 20
of the Assistance Administration Manual that apply to
Superfund response agreements are reviewed in this sec-
tion; those specifically imposed by the Superfund program
also are discussed. For additional details, refer to
Chapter 20 of the Assistance Administration Manual.
A. General EPA Requirements
State accounting systems must document all costs, in-
cluding costs of subagreements, incurred on a project and
must identify these costs by the EPA Assistance Agreement
Identification Number. Costs entered into the system
should be classified by the standard object class categor-
ies used in the assistance agreement. Specific items in
each of these categories are shown in Exhibit U-2, on the
following page.
Requirements for State accounting systems and for op-
erational procedures are found in 40 CFR Part 30, Sub-
part E. The State must develop and implement procedures
to control the receipt, obligation, and disbursement of
funds, and must provide for system audits and internal
reporting of financial status on a monthly basis. If the
State is charging indirect costs, the methodology used and
the rate must be negotiated, approved, and periodically
audited. Both EPA accounting system requirements and pro-
cedures are summarized in Exhibit U-3, following Exhi-
bit U-2.
States must support all entries in their accounting
systems by maintaining appropriate source documentation
and records. Supporting documentation may originate from
either within or outside the State's offices, but must
include complete records that explain each transaction.
Such records should include at least the following:
Cash receipts register
General ledger
Cost control ledger
Voucher journal
Payroll records
Property records
Employee timesheets
Travel/per diem expenses.
U-ll
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9375. 1-4-u
EXHIBIT U-2
ACCOUNTING REQUIREMENTS FOR PERSONNEL, TRAVEL,
EQUIPMENT, SUPPLY AND INDIRECT COSTS*
COST CATEGORY INFORMATION TO BE DOCUMENTED
COST CATEGORY INFORMATION TO BE DOCUMENTED
Personnel
Fringe Benefits
G
I
Position tides of staff
Number of hours
Salary of staff (annual or hourly rate)
Personnel costs, by individual, supported by
payroll and time records
Basis (percentage or other) upon which fringe
benefits are calculated
Fringe benefit records and costs, by individual
Equipment" Number and type(s) of equipment purchased
Price of each piece
Justification for purchases over $10,000 (per unit)
Description of usage charge employed to allocate costs,
or leasing rate, and total cost with supporting records
Provision that Slate:
Properly allocates cost among site-specific remedial
projects*
Accurately documents the use of equipment on a
remedial site-specific basis
Fulfills EPA's disposal instructions
Travel
Purpose of each trip
Starting point and destination
Transportation method
Per diem/subsistence while on travel
Number and names of persons traveling
Cost per trip and supporting travel records
Materials and Supplies
Indirect Costs
Superfund remedial program-specific; see Appendix A for pre-remedial activities.
See Exhibit U-5which describes equipment procurement process; also see Appendix T.
Type(s) of materials and supplies furnished
Purchase requests and orders
Contracts
Receiving reports
Total prices and invoices
Methodology for determining rate
Rate approval
Rate audit (periodic)
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9375.1-4-u
EXHIBIT U-3
GENERAL EPA ACCOUNTING REQUIREMENTS/PROCEDURES
APPLICABLE TO SUPERFUND
ACCOUNTING REQUIREMENTS
Ledgers with accurate, current, and complete records of financial actions
Records, with supporting documents, showing the source and application of all project funds
Provision for control over, and accountability for, all project funds, property, and other assets
Records that compare actual costs with budgeted costs for each project
Procedures to ensure prompt disbursement of Federal funds
Procedures for determining allowable, allocable, and reasonable costs
Annual system audits performed by State
Files containing audit reports (interim/final), including correspondence related to audits,
resolution of audit findings, appeal documents, and final resolutions
Procedures for negotiation and approval of indirect cost methodology and rate
structure
Audits conducted periodically by the State to verify indirect costs.
ACCOUNTING PROCEDURES
Records that ensure that all transactions are reported in a timely and verifiable manner
Provision for designation of one person, other than the individual responsible for project
operations, to account for all project funds
Provision for preparation of internal monthly financial reports (these are the basis for State
quarterly progress reports to EPA and for Financial Status Reports).
U-13
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9375.1-4-u.
Additional documentation may be necessary, depending on
the transaction. For example, support for purchases of
materials would include purchase requests, requests for
proposals, purchase orders, invoices, contracts, and re-
ceiving reports.
B. Superfund Response "Requirements
Requirements for State-lead Superfund projects conduc-
ted under Cooperative Agreements include those cited
above, as well as the additional requirements for account-
ing detailed below.*
In addition to identifying records using the EPA As-
sistance Agreement Identification Number for fund-financed
remedial activities, the State must identify files and
records by site name and number, and the appropriate ac-
tivity code. For cost recovery purposes, the State must
centralize overall fiscal responsibility for project funds
in a designated office. Responsibility for individual
funds and projects, as well as the site files for those
projects, may reside elsewhere depending upon the specific
area of project activity (e.g., risk assessment, geologi-
cal services, quality assurance).
The State should pay special attention to costs that
may be specific to Superfund or that require special docu-
mentation in the CERCLA program; these may include costs
incurred by personnel supporting the site/activity or
costs of equipment purchase and use. If funding is pro-
vided for negotiation and litigation activities, States
will be required to document these costs. Each appro-
priate State office (e.g., the environmental program, At-
torney General's Office, etc.) must retain documentation
that supports the costs incurred under the Cooperative
Agreement. These costs will be tracked by site name and
number and activity code.
The Superfund program has developed specific proce-
dures for allocating and recording costs for equipment
Where upgrade of the State's existing accounting sys-
tem is necessary solely to satisfy EPA or Superfund
requirements, the State, with pre-approval by EPA, may
charge the necessary conversion expenses as direct
costs under to the Cooperative Agreement, provided
that this practice is consistent with the State's nor-
mal procedure to account for direct costs.
U-14
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9375.1-4-u
purchase and use. These are displayed graphically in Ex-
hibit U-4, on the following page, and are discussed in
further detail in Appendix T of this manual. When such
costs are involved, all funds initially are charged to a
non-site-specific account (9ZZ). Once the State develops
a usage charge rate and obtains approval from the EPA
Award Official, the funds are transferred to a site-
specific account and are filed by the Cooperative Agree-
ment and Superfund account numbers. The State ultimately
is responsible for documenting expenses and usage by the
activity/site-specific accounting system.
Superfund cost recovery requirements dictate that the
State commit itself to cooperate and coordinate with EPA
in cost recovery actions (see Appendix F). The State must
maintain detailed records sufficient to substantiate such
cost recovery actions. The State should include a provi-
sion on this subject in its Cooperative Agreement applica-
tion to demonstrate that it understands its responsibili-
ties. If additional information is needed, the State and
EPA should negotiate additional terms for the agreement.
C. Superfund Pre-remedial Response Requirements
Obligations of funds for pre-remedial activities with-
in a State are not charged to site-specific accounts, as
they are for remedial projects. Rather, the State obli-
gates all pre-remedial work against a single Superfund
activity account number. The State is not required to
track or record its pre-remedial expenditures by site.
EPA, however, does require the State to identify its pre-
remedial expenditures by the appropriate Superfund As-
sistance Agreement Identification Number and the Superfund
activity account number. States must track and report
such expenditures by object class (cost) category, as re-
quired under 40 CFR Part 30; see Exhibit U-2 for Superfund
object class accounting requirements. In addition, the
State must give EPA an estimate of personnel hours for
each pre-remedial activity on a site-specific basis, as
part of its quarterly report.
U-15
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9375.1-4-u
EXHIBIT U-4
PROCEDURES FOR
DOCUMENTING PURCHASE AND USE
OF
CERCLA-FUNDED EQUIPMENT *
EPA Obligates Funds
to "9ZZ" Account
(Non-site-specific)
State Purchases
Equipment
State Develops
Usage Charge Rate
I
EPA Reviews/
Approves Usage
Charge Rate
State and EPA Amend CA
to Transfer
Funds to Site-specific
Account
State Documents
Expenditures and
Usage
I
State Requests
Equipment Disposal
Instructions "
See Appendix T for additional information
See Chapter X, Closeout, for additional information.
U-16
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9375.1-4-u
2. STATE RECORDKEEPING REQUIREMENTS
Under EPA's General Regulation for Assistance Programs
(40 CFR 30.500), States must establish an official file
for each assistance agreement and must maintain evidence
to document activities conducted using Federal funds.
Superfund requirements include activity/site-specific
recordkeeping as well. These requirements are outlined
below.
A. General EPA Requirements
Official State response agreement files must be estab-
lished upon joint signature of the agreement by EPA and
the State. Files must be maintained by EPA Assistance
Agreement Identification Number and must contain agreement
records, accounting books, and other information that can
be used to trace all transactions for assisted activi-
ties. Due to the separation of responsibility between op-
erational units of State government, it may not be possi-
ble to maintain a central file for each site. Under these
circumstances, however, the State is required to catalog
all files for a particular site in the same manner to al-
low easy access and reference.
In general, State files must document the following:
Assistance agreement development, including
Letter of Credit drawdown records
The amount, source, and disposition of all funds
received for the project, including all Federal
monies
Program income; that is, receipts and expendi-
tures of income from charges generated by the
project (such as sale of a solid waste by-product)
Non-expendable personal property purchased as a
direct cost under the agreement
Time records and other supporting data, including
justification for use of force account work and
force account approval (40 CFR Part 30)
Compliance with applicable cross-cutting Federal
statutes and regulations (40 CFR Part 30 and 40
CFR 300.68).
U-17
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9375.1-4-u
The records kept must trace each site transaction. Files
should include records submitted to EPA and those gener-
ated internally by the State. Files minimally must con-
tain all project records that relate to financial transac-
tions (including Financial Status Reports and Letter of
Credit drawdowns), technical progress, and site visits.
Superfund recordkeeping'and financial tracking require-
ments are displayed graphically on Exhibit U-5, on the
following page.
The State may perform all or part of the work under
the agreement itself, using its own employees and
equipment "force account" (40 CFR 30.520) -- or may
procure a contractor(s) to do so. In the latter case, the
State must retain detailed records in its files to docu-
ment contractor actions; these include:
Bid and proposal records, including records re-
lating to bid protests
Negotiated procurements, change orders, and docu-
mentation of negotiations
Cost/price analysis records documenting the rea-
sonableness, allowability, and allocability of
subagreement costs
Contract/statement of work
Contract delivery/work orders, invoices, and pay-
ment vouchers
Change orders issued to the contractor by the
State
Contractor progress reports
Documentation concerning any claims, disputes, or
non-compliance actions on the part of the
contractor.
A similar level of detail should be maintained for all
force account work.
It is also necessary for State files to document any
audits conducted either during the project or at final
agreement closeout, and to contain any other records gen-
erated in closing out the agreement. The State file
should include detailed records on all aspects of the in-
terim and final auditing process, as well as all records
U-18
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EXHIBIT U-5
FINANCIAL TRACKING AND RECORDKEEPING REQUIREMENTS
FOR STATE-LEAD SUPERFUND ACTIVITIES
9375.1-
FINANCIAL
Kl TRACKING
By object class:
Personnel
Fringe ben.
Travel
etc.
QUARTERLY
REPORT
Financial Report
Site-by-site
hourly tracking
Other items
PRE-REMEDIAL
c:
i
CERCLA
MULTI-SHE CA
PRE-REMEDIAL
AND OTHER
STATE-LEAD
ACTIVITIES
OTHER
1 RI/FS
1 MA During
RLFS
2 ROs
I PRPOversigl
MRA
FINANCIAL TRACKING
KEY:
CA - Cooperative Agreement
PA - Prelimina/y Assessment
SI - Site Inspection
Rl - Remedial Investigation
FS - Feasibility Study
MA - Management Assistance
RD - Remedial Design
PRP - Potentially Responsible Party
RA - Remedial Action
QUARTERLY
REPORT
(BY SITE)
-------
9375.1-4-u
pertaining to those reports and resolution of audit find-
ings, appeal documents, and final disposition. Agreement
closeout records retained must include the final Financial
Status Report, termination notices, if applicable, and any
documents or correspondence relating to final deobligation
of funds.
j
B. Superfund Response Requirements
The State must maintain project files for response
activities on a site-specific basis, identifying them by
site name and number and the activity code, as well as by
EPA Assistance Agreement Identification Number. Other re-
porting of information is necessary to ensure the accuracy
and completeness of records for possible cost recovery ac-
tions, including costs incurred during each budget period,
by cost category, for each site-specific activity.
C. Superfund Pre-remedial Requirements
Pre-remedial recordkeeping and reporting procedures
are simpler than those required for site-specific remedial
activities. The major difference lies in the extent to
which records must be sorted and expenditures reported.
For the pre-remedial program all records generated using
funds drawn from the pre-remedial account may be main-
tained in a single pre-remedial file. All records main-
tained in this file merely must be identified by the ap-
propriate Superfund Assistance Agreement Identification
and Superfund account numbers (see Appendix F).
U-20
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9375.1-4-u
3. STATE RECORD RETENTION AND ACCESS TO STATE FILES
This section discusses several types of issues that
may be grouped generally under the category of record re-
tention and access.
t
A. General EPA Requirements
The State and its contractors must retain all finan-
cial records, supporting documentation, and other records
pertinent to each response agreement, and to any subagree-
ment with a change order over $10,000, for three years
after submission of the final Financial Status Report.
Exceptions to this three-year requirement are:
Cost Recovery Action, Litigation, Claim, Appeal,
or Audit - If any cost recovery action, litiga-
tion, claim, appeal, or audit is begun before the
end of the retention period, records must be kept
until these actions are completed and resolved,
or until the end of the prescribed retention
period, whichever is later.
Property Records - Records pertaining to the pro-
curement and use of real and non-expendable per-
sonal property acquired with assistance funds
must be retained for three years following the
final disposition of the property.
Terminated Agreements - Records for a terminated
award must be retained for three years from the
date performance expires, except that records of
property must be kept for three years after the
property is officially transferred or otherwise
disposed.
All State and contractor records pertinent to an EPA
assistance agreement are subject to inspection and audit.
Such records must be made accessible to EPA, including the
Comptroller General of the United States and the cognizant
single audit agency, or to any authorized representative
of these entities (40 CFR 30.502). Access to records by
these entities is not limited to the mandatory retention
period. States and contractors must make such records
available, upon request, at any reasonable time as long as
the records exist.
B. Superfund Response Requirements
As stated above, States are required to retain records
for at least three years after the end of a project. For
U-21
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9375.1-4-u
Superfund response actions, this three-year period begins
with the submission date of the final Financial Status Re-
port. Contractors on Superfund response projects are re-
quired to retain all records for three years after proj-
ect completion or until any litigation, claim, appeal, or
audit begun during the project has been resolved, which-
ever is longer. States' should ensure that such a clause
is included in each subagreement.
The State also should limit the release of information
to third parties. If the State receives an information
request from a third party, the SPO should consult with
EPA and/or the State Attorney General's Office before re-
leasing any information. This will ensure that current or
potential enforcement actions are not jeopardized and that
enforcement personnel are aware of and can coordinate the
release of information to potentially responsible parties
who may be defendents in current or future litigation.
The U.S. Department of Justice (DOJ) is EPA's author-
ized representative for fund-financed response litiga-
tion. EPA and DOJ jointly develop cost recovery cases.
Therefore, both entities must have access to original
State records and files on an ongoing basis and to con-
tractor files for which the State arranges access or of
which the State has obtained copies. In addition, in its
response agreement the State commits itself to cooperating
and coordinating with EPA in cost recovery efforts (see
Appendix F). To this end, the State must provide EPA and
DOJ with information on site-specific costs and with cop-
ies of substantiating documentation when requested to do
so. All records serving as proof of expenditures should
be properly signed. The State may be required to provide
expert witnesses to authenticate and explain State files
and subagreement records, thus enabling such records to
serve as trial exhibits. Such information will be re-
quired to help ensure successful cost recovery, should
such actions be initiated.
If the State complies with the provisions of 40 CFR
Part 30, the Assistance Administration Manual, and the
Superfund-specific procedures discussed in this appendix,
the following information should be easily accessible when
requested:
Employee hours and salary (timesheets)
Employee travel and per diem expenses
Receipts for materials, equipment, and supplies
U-22
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9375.1-4-u
Sample collection and analysis costs
Subagreement costs (acknowledgement of completion
of work, paid vouchers, payment schedules, copy
of subagreement)
i
State Cooperative Agreement (invoices, letter of
credit drawdown vouchers, etc.)
Any costs not included in the above categories
associated with site response.
The State should include a provision on this subject in
its Cooperative Agreement application. Suggested language
is as follows:
The State is responsible for maintaining all fi-
nancial records. To assist in cost recovery ac-
tions, the State agrees to provide EPA and DOJ,
and their representatives, ongoing access to the
files that are maintained for this Cooperative
Agreement and to instruct its contractors to do
likewise. The State also agrees to provide both
EPA and DOJ access to any additional documenta-
tion required in potential cost recovery actions
or other litigation. Should either EPA or DOJ
request information on site-specific costs or
copies of supporting documentation to use in
their cost recovery actions, the State agrees to
provide such information and/or copies of docu-
mentation to. EPA and/or DOJ within the time spec-
ified in such request. The State may request
amendment of this Agreement to provide funds to
cover expenses incurred in meeting these obliga-
tions. The State also agrees to provide wit-
nesses (or to require State contractors to pro-
vide witnesses) to authenticate and explain
records during litigation and negotiations.
This provision can be modified, as appropriate.
Substitution of original documentation by microform
records is generally allowable. Any microform copying
undertaken by the State or its contractors, however,
should be done in accordance with, or in a manner equiva-
lent to, the technical requirements for copying Federal
government records (36 CFR section 1230 et.seg.). All
reproduction must result in complete, legible, and accu-
rate copies. In addition, the original document must be
retained until the micrographic process has been completed
U-23
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9375.1-4-u
and the microform has been developed, copied, and approved
by EPA for quality assurance/quality control purposes.
The State must notify EPA in writing of any pending dis-
posal of original or microform records and files.. EPA
will either concur in the State's plan or will propose an
alternate disposition method.
The State should acknowledge this record retention
requirement in its Cooperative Agreement application; if
it is not acknowledged, EPA will add an appropriate
special condition to the award agreement. A suitable
provision is provided below:
In accordance with 40 CFR Parts 30 and 33, the
State will retain records generated under this
Cooperative Agreement for three years from the
date of submission of the final Financial Status
Report or until any litigation, audit, claim or
cost recovery actions begun during the project are
resolved, whichever is longer. The State will
contact the EPA Project Manager in advance of the
proposed disposition of any records from the file
developed for this project. No files or documents
concerning this Cooperative Agreement shall be
disposed of without notifying EPA in advance.
Upon notification, EPA may require that the docu-
ments be retained by the State for an additional
specified period. The State may request reim-
bursement for the cost of retention for the addi-
tional period. Alternatively, EPA may require
that the documents be transferred to EPA for re-
tention. State and State contractor files, and
any additional documentation for cost recovery
purposes, can be retained in microform, if the
documents are suitable for microform copying and
if the microform can be reproduced as an accurate
hard copy version of the original. The State or
its contractor will obtain EPA approval of the
process before copying or disposal of the original
documentation. Original documents must be re-
tained for those types of documents that are not
capable of being completely and accurately micro-
formed (such as large documents, photographs or
blue prints).
The State also will notify EPA of any notification of
document disposal received from a State contractor. EPA
will impose the same requirements for retention or dis-
posal of State contractor records as with State records.
U-24
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9375.1-4-u
4. INTERNAL CONTROLS FOR STATE ACCOUNTING SYSTEMS
A State accounting system must have internal control
procedures to ensure that all project funds, property, and
other assets are used solely for purposes authorized in
the response agreement. Internal control procedures must
provide effective financial and operational controls.
Specific requirements for internal controls include:
Appropriate staffing, with associated training
Adequate methods of authorization, recordkeeping,
and transaction coding
Expenditure controls to ensure that goods and
services are acquired at the lowest possible
price and conform with requirements outlined in
the subagreement
Property safeguards and inventories to prevent
misuse and loss
Monitoring of the subagreement to ensure that
contractor responsibilities are fulfilled.
An effective internal control operation provides a system
of checks and balances for all accounting and record-
keeping in the cost documentation process. Chapter 20 of
the Assistance Administration Manual provides additional
details on internal control requirements; these are
equally applicable to a State's accounting system for
Superfund.
U-25
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9375.1-4-u
5. CONTRACTOR FILES
EPA regulations require State contractors to maintain
financial and other records pertinent to a Federally
funded project. The requirements that apply to contractor
records under Superfund* Cooperative Agreements are similar
to those with which a State must comply. This section
discusses Agency wide and Superfund-specific contractor
obligations in this area.
A. General EPA Requirements
Agency guidance requires that all contractor records
comply with 40 CFR Parts 30 and 33. The Assistance Ad-
ministration Manual (Chapter 19, paragraph l.b) further
specifies that contractor records must reflect the level
of the contractor's participation in the project.
The records that a Superfund response contractor
should maintain are comparable to those for the State it-
self, identified in the previous sections. These include,
but are not limited to:
Bid records
Contract/statement of work
,
Contract delivery/work orders, invoices, and pay-
ment vouchers
Change orders issued by the State
Progress reports
Stop-work orders
Documentation concerning any claims or disputes
Accounting records in accordance with generally
accepted accounting practices
Financial information and data used in the prep-
aration or support of cost submissions required
under 40 CFR 33.290.
Contractor invoices should itemize expenses to the level
of detail shown in Exhibit U-2 and should include a break-
down of expenditures reflecting the activities performed
for each project. Contractors also must maintain similar
records for all subcontractors.
U-26
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9375.1-4-u
B. Superfund Requirements
There are several requirements that the Superfund pro-
gram imposes upon States and their contractors. States
are required to instruct their contractors to:
Maintain detai'led records by site and activity
Provide testimony/witnesses during cost recovery
actions or other information, when requested by
the State or EPA
Keep records for three years after project com-
pletion, or until any audit, litigation, claim,
cost recovery, and or any disputes initiated be-
fore the end of the three-year period are re-
solved, whichever is longer, and notify EPA
before disposing of files.
Contractors also may be required to provide documentation
that there is no conflict of interest that may affect
their work on a project (see Appendix F).
U-27
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