OFFICE OF INSPECTOR GENERAL
Catalyst for Improving the Environment
Early Warning Report
Making Better Use of
Superfund Special Account
Funds for Thermo Chem
Report No. 2007-S-00002
August 20, 2007
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
OFFICE OF
INSPECTOR GENERAL
MEMORANDUM
SUBJECT:
FROM:
TO:
August 20, 2007
Making Better Use of Superfund Special Account Funds for Thermo Chem
Report No. 2007-S-00002
Wade T. Najjum * /
Assistant Inspector General
Office of Program Evaluation
Mary Gade
Region Administrator
EPA Region 5
This memorandum is to inform you of Office of Inspector General (OIG) findings that require
immediate action regarding Region 5's special account management of the Thermo Chem
Superfund site.
The OIG is conducting a review of (1) U.S. Environmental Protection Agency (EPA) regions'
utilization of special account funds for a sample of accounts with high available balances, and
(2) EPA regions' utilization of special account funds for accounts that are 10 years or older.
During our review of selected Region 5 accounts that were at least 10 years old, we found:
• Region 5 has not reclassified approximately $2.8 million from the Thermo Chem special
account, as recommended in the Region's April 12, 2004, Cost Recovery Closeout
Action memorandum for the site. This is inconsistent with EPA guidance (OSWER #
9275.1-03) on managing Superfund special accounts. When these funds are reclassified,
they can fund other Region 5 response activities.
• Reclassification did not occur because the site managers were unaware that action was
needed or required. In addition, while EPA's guidance states that "Regions" are
responsible for identifying special accounts having balances that are more than
anticipated future site needs, it does not specify the title of the regional official
responsible for doing so or responsible for processing the reclassification. Our review of
the Thermo Chem special account caused Region 5 to recognize the need to timely
reclassify.
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• Region 5 could have used the $2.8 million (approximately) to begin construction at other
sites in the Region. For example, according to EPA's Web site, in Fiscal Year 2005,
EPA stated that the Ottawa Radiation (Areas 1, 4, 9, & 11, and Illinois Power) site did
not receive new construction funding. Region 5 could have used the reclassified funds to
begin construction at this site in Fiscal Year 2005.
• The Thermo Chem special account was established in 1995 and has approximately
$6 million available, as of May 31, 2007.l However, no funds have been disbursed from
the account as of this date. Recently, Region 5 updated future planned uses for the
account funds. Approximately $524,000 of the account funds are not planned for future
use.
• On July 17, 2007, the Remedial Project Manager for the Thermo Chem site stated that
Region 5's Superfund Division will take steps to reclassify approximately $2.8 million
from Thermo Chem's special account and take other actions to better account for site-
related charges that should be funded from the Thermo Chem special account.
Additional costs have accrued since the Cost Recovery Closeout Action memorandum
was issued in 2004; thus, additional costs could be reclassified.
We recommend that the Region 5 Administrator:
1) Reclassify approximately $2.8 million (plus additional accrued costs) of the Thermo
Chem special account to fund other priority response activities.
2) Reclassify, or transfer to the Trust Fund (as appropriate), approximately $524,000 of the
Thermo Chem special account that has no planned future use.
Please provide a written response to the findings and recommendations within 15 days from the
date of this memorandum. Your response should include milestones for each of the
recommendations. Please email an electronic version of your response that complies with
section 508 of the Rehabilitation Act to Carolyn Copper at copper. carolyn@epa. gov.
Our final report will include other OIG findings related to Superfund special account
management improvements in Region 5, and other Regions, as appropriate. We will include
your final response to the issues identified in this memorandum. If there are questions, I can be
reached at (202) 566-0827 or najjum.wade@epa.gov, or Carolyn Copper can be reached at
(202) 566-0829 or copper.carolyn@epa.gov.
1 On 8/7/07, we obtained a "checkbook" report from ORBIT for this account as of 8/7/07. However, the date of the
most recent entry is May 31, 2007.
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Status of Recommendations and
Potential Monetary Benefits
POTENTIAL MONETARY
RECOMMENDATIONS BENEFITS (in $OOOs)
Planned
Rec. Page Completion Claimed Agreed To
No. No. Subject Status1 Action Official Date Amount Amount
2 Reclassify approximately $2.8 million (plus 0 Region 5 Administrator $2,800
additional accrued costs) of the Thermo Chem
special account to fund other priority response
activities.
2 Reclassify, or transfer to the Trust Fund (as 0 Region 5 Administrator $524
appropriate), approximately $524,000 of the
Thermo Chem special account that has no
planned future use.
0 = recommendation is open with agreed-to corrective actions pending;
C = recommendation is closed with all agreed-to actions completed;
U = recommendation is undecided with resolution efforts in progress
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Appendix A
Distribution
Regional Administrator, Region 5
Assistant Administrator, Office of Enforcement and Compliance Assurance
Assistant Administrator, Office of Solid Waste and Emergency Response
Chief Financial Officer
Principal Deputy Assistant Administrator, Office of Solid Waste and Emergency Response
Principal Deputy Assistant Administrator, Office of Enforcement and Compliance Assurance
Deputy Assistant Administrator, Office of Enforcement and Compliance Assurance
Superfund Division Director, Region 5
Audit Liaison, Region 5
Enforcement Coordinator, Region 5
Resource Management Division, Region 5
Remedial Project Manager, SFD, Region 5
Office of Regional Counsel, Region 5
Director, Office of Site Remediation and Technology Innovation
Director, Office of Site Remediation Enforcement
Agency Followup Official (the CFO)
Agency Followup Coordinator
Associate Administrator for Congressional and Intergovernmental Relations
Associate Administrator for Public Affairs
Acting Inspector General
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