U.S. ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF INSPECTOR GENERAL
Semiannual Report to Congress
October 1, 2011-March 31, 2012
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EPA-350-R-12-002
May 2012
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Index of Reporting Requirements
Inspector General Act of 1978, as amended
Requirement
Section 4(a)(2)
Section 5(a)(1)
Section 5(a)(2)
Section 5(a)(3)
Section 5(a)(3)
Section 5(a)(4)
Section 5(a)(5)
Section 5(a)(6)
Section 5(a)(7)
Section 5(a)(8)
Section 5(a)(9)
Section 5(a)(10)
Section 5(a)(11)
Section 5(a)(12)
Abbreviations
CSB
DCAA
EPA
FY
LSI
OIG
OMB
ORD
Subject
Review of legislation and regulations
Significant problems, abuses, and deficiencies
Significant recommendations for corrective action
Reports with corrective action not completed
Peer reviews conducted
Matters referred to prosecutive authorities
Information or assistance refused
List of reports issued
Summaries of significant reports
Audit, inspection, and evaluation reports — questioned costs
Audit, inspection, and evaluation reports — funds to be put to better use
Prior audit, inspection, and evaluation reports unresolved
Significant revised management decisions
Significant management decisions with which OIG disagreed
U.S. Chemical Safety and Hazard Investigation Board
Defense Contract Audit Agency
U.S. Environmental Protection Agency
Fiscal Year
Laboratory for Scientific Interrogation, Inc.
Office of Inspector General
Office of Management and Budget
Office of Research and Development
Pages
34-35
3-31,37-38
3-27, 37-38
60
34
5,28-31, 39,43-44
None
45-50
3-27, 37-38
39-41,44-50
39-41,44-50
40-41, 51-59
None
None
Cover photos:
An assortment of images related to work done by the EPA Office of Inspector General
during the semiannual reporting period. Clockwise, from top left: mining activities at
the future Botanic Garden in Pennsylvania (EPA OIG photo); a mountainous
landscape in Central Appalachia before the mountaintop mine/valley fill process
(EPA photo); the same landscape after the mine/valley fill process (EPA photo); and
an EPA enforcement officer inspecting an underground storage tank (EPA photo).
Hotline
To report fraud, waste, or abuse, contact us through one of the following methods:
write:
e-mail: OIG Hotline@epa.gov
phone: 1-888-546-8740
fax: 202-566-2599
online: http://www.epa.gov/oig/hotline.htm
EPA Inspector General Hotline
1200 Pennsylvania Avenue NW
Mailcode2431T
Washington, DC 20460
Printed on 100% recycled paper (minimum 50% postconsumer)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Message to Congress
I am pleased to announce that the Office of Inspector General (OIG)
of the U.S. Environmental Protection Agency (EPA) has
implemented a strategic plan for fiscal years 2012-2016.1 believe a
strategic plan is a fundamental element for the success of any
organization, and one of my top priorities since becoming the EPA
Inspector General has been to update our plan. Developing the plan
involved an extensive process of assessing our internal and external
environment and engaging with our stakeholders to guide us as we
created a new vision for the OIG: "Be the best in public service and
oversight for a better environment tomorrow." We also refreshed our
mission statement and updated our goals. The strategic plan stresses
our core values of customer service, integrity, and accountability.
Arthur A. Elkins, Jr.
Being transparent is an important part of how we function, and
to improve our transparency our notification memorandums
announcing the start of new audits and evaluations are now available on our website. This way,
the public can know about audits and evaluations in process as well as access the results of
completed audits and evaluations.
During this semiannual reporting period covering October 1, 2011, through March 31, 2012, we
did extensive work related to EPA's disbursement of funds received from the American Recovery
and Reinvestment Act of 2009 (Recovery Act). For one project, we found that the Botanic
Garden of Western Pennsylvania used $1.3 million in Recovery Act funds to construct ponds that
are not being used for their stated purpose. Instead of being used for irrigation needs, the ponds
are being used to capture runoff for a mining reclamation operation. At two other sites, we
questioned whether Recovery Act fund recipients were meeting the Act's Buy American
requirements. Further, as a result of our investigation work, a California business owner was
sentenced for submitting counterfeit surety bonds to the City of Sacramento in connection with a
Recovery Act grant.
EPA addresses serious pollution problems through its enforcement actions. We found that EPA
does not administer a consistent national enforcement program, and states do not always take the
necessary enforcement actions. Despite EPA efforts to improve state enforcement programs,
states frequently do not meet national goals. Further, although EPA has taken steps to improve its
program to prevent oil spills into U.S. waters, the Agency remains largely unaware of the identity
and compliance status of the vast majority of regulated facilities.
In other reviews, we noted that EPA does not currently have sufficient information on processes
to effectively manage the human health and environmental risks of nanomaterials, which the
Agency defines as chemical substances controlled at the scale of approximately one-billionth of a
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Semiannual Report to Congress October 1, 2011—March 31, 2012
meter. Also, although EPA and the states use the Drinking Water State Revolving Fund to assist
communities in achieving or maintaining compliance with drinking water standards, some high-
priority systems were not aware of the program.
EPA complied with the 2010 Improper Payments Elimination and Recovery Act in that it
reported all required information on improper payments, but EPA can improve the accuracy and
completeness of that information. We also found that EPA did not comply with several key
revisions to the Federal Acquisition Regulation regarding the use of cost-reimbursement
contracts.
As a result of one of our investigations, a Georgia business owner was sentenced to 20 months in
jail for fabricating a story in which he claimed persons posing as EPA employees had fined him
for alleged environmental violations. A Tennessee man was sentenced to 6 months in jail for
falsifying monthly Clean Water Act discharge monitoring reports. Two tribal coalition employees
in South Dakota were sentenced for embezzling funds. A former EPA employee was sentenced to
5 years in jail for charges related to child pornography. Another former EPA employee was
sentenced to 5 months in jail for perjury and obstruction of justice.
The EPA Inspector General also serves as the Inspector General for the U.S. Chemical Safety and
Hazard Investigation Board (CSB). During this semiannual reporting period, we issued a report
noting that CSB was not fully compliant with the reporting requirements of the 2010 Improper
Payments Elimination and Recovery Act as it did not publish its Performance and Accountability
report on its website. Another review found that CSB has an information security program in
place that appears to be functioning as designed, although CSB could improve its vulnerability
scanning and patch management process.
I want to express my appreciation to the Agency and Congress for their support of the work of the
OIG. We have made great progress, and I believe we will continue to be a valuable partner for the
EPA in its work to safeguard the health of the American people and to protect the environment
today and for future generations.
Arthur A. Elkins, Jr.
Inspector General
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Table of Contents
About EPA and Its Office of Inspector General 1
U.S. Environmental Protection Agency 1
EPA Office of Inspector General 1
OIG Issues Strategic Plan for FYs 2012-2016 1
Key Topics 3
Recovery Act 3
Enforcement 7
Mountaintop Mining 10
Superfund 13
Other Significant OIG Activity 16
Human Health and the Environment 16
Agency Business Practices and Accountability 20
Investigations 28
Testimony 32
Other Activities 34
U.S. Chemical Safety and Hazard Investigation Board 37
Statistical Data 39
Profile of Activities and Results 39
Audit, Inspection, and Evaluation Report Resolution 40
Hotline Activity 42
Summary of Investigative Results 43
Scoreboard of Results 44
Appendices 45
Appendix 1—Reports Issued 45
Appendix 2—Reports Issued Without Management Decisions 51
Appendix 3—Reports With Corrective Action Not Completed 60
Appendix 4—OIG Mailing Addresses and Telephone Numbers 61
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
About EPA and Its
Office of Inspector General
U.S. Environmental Protection Agency
The mission of the U.S. Environmental Protection Agency (EPA, or Agency) is to protect
human health and the environment. As America's steward for the environment since
1970, EPA has endeavored to ensure that the public has air that is safe to breathe, water
that is clean and safe to drink, food that is free from dangerous pesticide residues, and
communities that are protected from toxic chemicals. EPA's fiscal year (FY) 2012
enacted budget is $8,449,385,000.
EPA Office of Inspector General
The Office of Inspector General (OIG) is an independent office of EPA that detects and
prevents fraud, waste, and abuse to help the Agency protect human health and the
environment more efficiently and cost effectively. Although we are part of EPA,
Congress provides us with a budget line item separate from the Agency's to ensure our
independence. The EPA OIG was created and is governed by the Inspector General Act
of 1978, as amended (5 U.S.C. App. 3). OIG staff are physically located at headquarters
in Washington, DC; at EPA's 10 regional offices; and at other EPA locations including
Research Triangle Park, North Carolina, and Cincinnati, Ohio. The OIG's enacted budget
for FY 2012 was $51,872,000 with 358 full-time equivalent positions. The EPA Inspector
General also serves as the Inspector General for the U.S. Chemical Safety and Hazard
Investigation Board (CSB).
OIG Issues Strategic Plan for FYs 2012-2016
As part of a new vision and revitalization for the EPA OIG, Inspector General Arthur A.
Elkins, Jr., issued the OIG's Strategic Plan for FYs 2012-2016. This strategic plan will
play an important part in guiding the OIG as it performs its work. Preparing the plan
involved soliciting input from the OIG's many stakeholders, including the entire OIG staff,
EPA leadership, congressional committees, state associations, the U.S. Government
Accountability Office, and the U.S. Office of Management and Budget (OMB). This plan
will be a living document that will provide a unified direction with clear expectations. The
plan is at htto://www.epa.gov/oig/reports/2012/EPA OIG Strategic Plan 2012-2016.pdf.
The OIG's new vision, mission, values, and goals are as follows:
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Be the best in public service and oversight for a better environment tomorrow.
Mission
Promote economy, efficiency, effectiveness, and prevent and detect fraud, waste,
and abuse through independent oversight of the programs and operations of the
EPA and CSB.
• Customer Service: Everyone deserves to be treated with fairness, respect, and
dignity.
• Integrity: Our people and products are trustworthy.
• Accountability: We are individually and collectively responsible for all we do.
1. Contribute to improved human health, safety, and environment.
2. Contribute to improved EPA and CSB business practices and accountability.
3. Be responsible stewards of taxpayer dollars.
4. Be the best in government service.
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Key Topics
Recovery Act
The American Recovery and Reinvestment Act of 2009
(Recovery Act), signed by President Obama on February 17,
2009, provides the EPA OIG $20 million for oversight activities
through September 30, 2012. The OIG is conducting audits,
evaluations, investigations, and other reviews to ensure
economy and efficiency, and to prevent and detect fraud, waste,
and abuse in EPA's disbursement of the $7.2 billion it received
under the Recovery Act. OIG assignments include reviews
based on concerns raised by the public. Since the inception of the Recovery Act in 2009,
the OIG has received 87 complaints related to EPA Recovery Act funds, and has
conducted 174 Recovery Act awareness briefings and outreach sessions. As of March 31,
2012, the OIG had expended $14,954,654 in Recovery Act funds. Individuals may report
any suspicion of fraud, waste, or abuse via the OIG hotline at
http://www.epa. gov/oig/hotline .htm. Details on OIG Recovery Act efforts during the
semiannual reporting period ending March 31, 2012, follow.
Recovery Act Funds Inappropriately Used to Support
Mining Reclamation Operation
The Botanic Garden of Western Pennsylvania used Recovery Act funds to
construct ponds that are not being used for their stated purpose. Instead of being
used for irrigation needs, the ponds are being used to capture runoff for a mining
reclamation operation.
The Botanic Garden, located near Pittsburgh,
Pennsylvania, used $1,368,894 in Recovery Act funds to
install three permanent irrigation ponds to collect, store,
and recycle water for future irrigation needs. However,
the ponds are being used as sediment ponds to capture
runoff from a mining reclamation operation. Therefore,
amounts claimed for building the ponds are not eligible
or allowable project costs under the Recovery Act and
the terms and conditions of the funding agreement.
Additionally, the Botanic Garden is operating, through a
contractor, a for-profit surface mining reclamation
operation that will generate revenue for the Botanic
Mining activities on the site of the future Botanic
Garden. (EPA OIG photo)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Garden. The revenue generated by the mining activity would be program income that
must be used to offset the Recovery Act-funded project costs.
We recommended that EPA recover the $1,368,894, and prevent the continued use of
Clean Water State Revolving Fund dollars for this project. EPA, the Botanic Garden, and
the Commonwealth of Pennsylvania did not agree with the findings and
recommendations in this report.
(ReportNo. 12-R-0321, American Recovery and Reinvestment Act Site Visit of the
Botanic Garden of Western Pennsylvania, March 8, 2012)
Site Visits Note Issues Regarding Buy American Requirements
As a result of site visits, we questioned whether two Recovery Act fund recipients
were meeting the Act's Buy American requirements.
The Village of Itasca, Illinois, received a $20 million loan from the State of Illinois
through the Water Pollution Control Loan Program. The loan included $10 million in
Recovery Act funds, which the village used to
construct a new wastewater treatment plant. The
village did not comply with the Buy American
requirements of the Recovery Act. Steel pipes
and fittings used in the project were
manufactured in foreign countries. We also
identified other manufactured goods that did not
comply with the Buy American requirements of
the Recovery Act. As a result, the project is not
eligible for the $10 million of Recovery Act
funds authorized by the state, unless EPA
exercises a regulatory option. We recommended that EPA require Illinois to withdraw the
Recovery Act funds unless the state can verify that Itasca has complied with Buy
American requirements. (ReportNo. 12-R-0377, American Recovery and Reinvestment
Act Site Visit of Wastewater Treatment Plant, Village of Itasca, Illinois, March 30, 2012)
Q'TY: 2 PCS
N.W: 319 Kgs
G.W: 320 Kgs
CINQ: 002
Steel pipe label at Itasca site. (EPA OIG
photo)
Well head at the Elizabeth City Well Field
Expansion Site. (EPA OIG photo)
Elizabeth City, North Carolina, received a $2,366,255
Recovery Act loan from North Carolina to expand its well
field with four new wells to meet the state's 12 hour/day
maximum pumping requirement. In the draft report, we
questioned whether three manufactured goods used on the
project met the Buy American requirements of Section 1605
of the Recovery Act, and whether engineering costs claimed
were allocable to the Recovery Act project. In response to
the draft report, the city provided additional information to
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Semiannual Report to Congress October 1, 2011—March 31, 2012
support Buy American compliance for one item. The city took corrective action and
added the two remaining items to the project's Buy American de minimis waiver list. We
concurred with the actions taken by the city. Further engineering support provided led us
to conclude that costs incurred prior to the Recovery Act were needed to make the project
shovel-ready and, therefore, were allocable to the project. (Report No. 12-R-0109,
American Recovery and Reinvestment Act Site Visit of the Elizabeth City Well Field
Expansion Project, Elizabeth City, North Carolina, December 8, 2011)
Business Owner Sentenced for Submitting False Surety Bonds
On March 20, 2012, Peter Scott, of Roseville, California, was sentenced in
U.S. District Court, Eastern District of California, to 60 months of probation,
including 3 months of home detention, for submitting false surety bonds in
connection with a Recovery Act grant. Scott was also ordered to pay a $500
fine and a $200 special assessment.
In 2009, the City of Sacramento received a Recovery Act grant from EPA to retrofit
water meters on city homes. Bidders for the water meter retrofit contracts were required
to have surety bonds to cover any losses that may result during the project. Scott,
President of Advantage Demolition and Engineering, was awarded two of these contracts
valued at $3.465 million. As part of those contracts, Scott submitted counterfeit surety
bonds purportedly issued by the Merchants Bonding Company.
Scott's firm began work on the water meter project in November 2009. However, in early
January 2010, City of Sacramento inspectors noticed problems with the firm's work. The
city subsequently determined that the surety bonds submitted by Advantage Demolition
and Engineering were fraudulent and issued a stop-work order.
This investigation was conducted with the Federal Bureau of Investigation.
Complaints Regarding Recovery Act Expenditures Reviewed
We completed two reviews of hotline complaints filed regarding EPA Recovery
Act spending.
For one complaint, we did not find any indication of misuse of the $20 million in
EPA Recovery Act or Clean Water State Revolving Fund dollars provided to the
Metropolitan Water Reclamation District of Greater Chicago by the State of Illinois.
The $20 million in Clean Water State Revolving Fund dollars included $10 million in
Recovery Act funds. A complaint alleged that the district may have used noncompetitive
practices when procuring bond underwriting contracts and also incurred excessive
expenses. However, the types of costs mentioned in the complaint were not included in
the amounts paid to the district through the Clean Water State Revolving Fund or
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Recovery Act funds. The EPA funding did not pay for questioned professional services
contracts or other administrative costs such as training, travel, entertainment, or
conference expenses. (Report No. 12-X-0090, Close-Out of Complaint on Metropolitan
Water Reclamation District of Greater Chicago Incurring Inappropriate Expenses on
Recovery Act Projects, November 22, 2011)
For another complaint, we found no evidence to support allegations regarding a
wastewater treatment facility project for the Perkins Public Works Authority, Perkins,
Oklahoma. Allegations claimed that the Recovery Act's Buy American and Wage Rate
requirements caused the lowest construction bid of $5.9 million to be almost 48 percent
higher than the design engineer's estimated construction costs. We were not able to
determine why the costs were so much higher than the engineer's estimates due to a lack
of comparative data. However, we found no evidence that Recovery Act requirements
caused the large increase. The Recovery Act's wage requirement had no effect because
the contractor paid its construction employees higher wages than those required. The
impact of the Buy American requirement was unknown because the contractor only
requested prices for American-made goods, as required by the Recovery Act.
(Report No. 12-X-0161, Close-Out of Hotline Complaint on Unreasonable Cost Increase
to the Wastewater Treatment Facility Improvements, Perkins, Oklahoma, December 29,
2011)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Enforcement
EPA, in partnership with state and tribal governments and other federal agencies.
enforces the nation's environmental laws, including the Clean Water Act and Clean Air
Act. EPA addresses serious pollution problems through its enforcement actions.
EPA Must Improve Oversight of State Enforcement
EPA does not administer a consistent national enforcement program, and states
do not always take necessary enforcement actions.
Despite efforts by EPA's Office of Enforcement and Compliance Assurance and EPA
regions to improve state enforcement performance, state enforcement programs
frequently do not meet national goals. State enforcement programs are
underperforming—EPA data indicate that noncompliance is high and the level of
enforcement is low. EPA does not consistently hold states accountable for meeting
enforcement standards, has not set clear and consistent national benchmarks, and does not
act effectively to curtail weak and inconsistent enforcement by states.
REGION 9:
244
REGION 8:
169
REGION?:
172
REGION 4:
356
REGION 1:
174
REGION 2:
267
REGION 3:
283
Average enforcement full-time equivalent
allocations, FYs 2000-2010. (Office of the
Chief Financial Officer data)
EPA has made efforts to improve state performance
and oversight consistency, but EPA does not manage
or allocate enforcement resources nationally to allow it
to intervene in states where practices result in
significantly unequal enforcement. As a result, state
performance remains inconsistent across the country,
providing unequal environmental benefits to the public
and an uneven playing field for regulated industries.
EPA could make more effective use of its $372 million
in regional enforcement full-time equivalents by
directing a single national workforce instead of
10 inconsistent regional enforcement programs.
We recommended that EPA establish clear national
lines of authority for enforcement that include
centralized authority over resources, address outdated guidance and policies, establish
clear benchmarks for state performance, and establish a clear policy describing when and
how EPA will intervene in states. All recommendations are unresolved pending receipt of
EPA's corrective action plan.
(Report No. 12-P-0113, EPA Must Improve Oversight of State Enforcement,
December 9, 2011)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
EPA Needs to Further Improve Management of Oil Pollution
Prevention Program
Although EPA has taken steps to improve its program to prevent oil spills into
U.S. waters, the Agency remains largely unaware of the identity and compliance
status of the vast majority of Clean Water Act Section 311 regulated facilities. We
performed this evaluation in response to a request from the House Committee on
Transportation and Infrastructure.
Clean Water Act Section 311 prohibits the discharge of oil or hazardous substances into
or upon U.S. navigable waters and adjoining shorelines in quantities that may be harmful.
In 1973, EPA issued the Spill Prevention, Control, and Countermeasure Rule to establish
procedures, methods, and equipment requirements to prevent oil discharges from
nontransportation-related facilities. The rule requires
facilities to prepare plans outlining their spill prevention
procedures and countermeasures to address the effects of an
oil spill.
EPA has taken a number of steps to improve the quality and
consistency of Spill Prevention, Control, and
Countermeasure Rule Plans and Facility Response Plans.
However, EPA still does not have sufficient knowledge on
most facilities it is responsible for regulating. In addition,
Agency data systems cannot exchange data with each other,
and lack consistent and sufficient codes to categorize
deficiencies and noncompliance. These data system limitations prevent EPA from
capturing the full details of a known violator's history or identifying trends in compliance
and enforcement. As a result, EPA cannot assess the success of steps it has taken to
improve the quality and consistency of plans or the oil pollution prevention program as a
whole.
An aboveground storage facility in Nenana,
Alaska. (EPA photo)
We recommended that EPA improve oversight of facilities regulated by EPA's oil
pollution prevention program. While the Agency recognized that it could improve the
program, it neither agreed nor disagreed with most of our recommendations. All
recommendations in this report are unresolved.
(Report No. 12-P-0253, EPA Needs to Further Improve How It Manages Its Oil Pollution
Prevention Program, February 6, 2012)
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Controls Over State Underground Storage Tank Inspections
Generally Effective
EPA regions have management controls to verify the quality of state
underground storage tank inspections.
There are nearly 600,000 underground storage tanks in the United States. EPA annually
provides $34.5 million in grants to states, tribes, and territories to implement
underground storage tank inspection and compliance programs.
The three regions where we conducted our review had annually
reviewed underground storage tank inspection programs to
verify compliance with requirements. Two of the three regions
conducted more extensive annual reviews and made
recommendations to the states to improve their programs.
While we did not find any major deficiencies, the memoranda
of agreement between EPA regions and the state programs
either do not exist or do not reflect changes required by the
An EPA enforcement officer inspecting an Energy Policy Act of 2005. We recommended that EPA and
underground storage tank. (EPA photo) , . . , IT-™* i -j
states enter into such agreements, and EPA agreed with our
recommendations.
(Report No. 12-P-0289, Controls Over State Underground Storage Tank Inspection
Programs in EPA Regions Generally Effective, February 15, 2012)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Mountaintop Mining
The United States produced 1.1 billion tons of coal in 2009, and Appalachian Basin states
account for 40 percent of all U.S. coal production. The U.S. Army Corps of Engineers
has indicated that, since 1982, surface coal mining activities in the Appalachian region
have become more prevalent. Consequently, there is increased concern regarding the
adverse effects of those activities on the environment, including streams and other
aquatic resources. The U.S. Army Corps of Engineers issues permits for surface coal
mining under Clean Water Act Section 404, although EPA assesses the environmental
and water quality impacts of the proposed permits.
A mountainous landscape in Central Appalachia before (top) and after (bottom) the mountaintop
mine/valley fill process. (EPA photos)
Congressionally Requested Information Provided on Permit
Applications
As a result of a request from the Ranking Member of the Senate Committee on
Environment and Public Works, we sought to determine (1) the status of a list of
237 mountaintop mining permit applications and the length of review for each
permit, (2) reasons for the length of review for each permit, and (3) the number of
permits EPA has processed according to "enhanced review" and "conductivity"
procedures and the average length of time to process a permit under these
procedures.
We found the following regarding the three issues:
(1) After reconciling discrepancies and vetting information, we identified 185
surface mining permit applications to review from the list of 237. We found that
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Semiannual Report to Congress October 1, 2011—March 31, 2012
over half of all permit activities—whether permitted, withdrawn, or pending—
had taken 1 year or longer, with approximately 40 percent exceeding 2 years.
(2) We found that several reasons account for the length of time, including complex
reviews based on new scientific evidence, applicant factors, involvement of EPA
headquarters, and a U.S. Army Corps of Engineers procedural change.
(3) EPA identified 79 permit applications for enhanced review and, as of the
issuance of our report, had issued 8 permits and 40 applications withdrawn
(In October 2011, the U.S. District Court for the District of Columbia held that
EPA operated beyond the scope of its authority under the Clean Water Act when
it instituted the enhanced coordination process, and the court ordered it to be set
aside.)
Our report did not make any recommendations.
(Report No. 12-P-0083, Congressionally Requested Information on the Status and Length
of Review for Appalachian Surface Mining Permit Applications, November 21, 2011)
EPA Should Strengthen Records Management for Mining Permits
During our review of surface coal mining permits as a result of a congressional
request (see above), we found that EPA staff in Regions 3, 4, and 5 should better
document their records of review activities on Clean Water Action Section 404
surface mining permit notifications.
EPA reviews permit notifications for water quality and provides the U.S. Army Corps of
Engineers with comment letters on some permit notifications. The Federal Records Act
states that records should include all documentary materials in connection with the
transaction of public business.
EPA regional staff believe that Agency comment letters are the only official records that
they should maintain related to notification reviews. Because of the limited
documentation, information we needed to complete our congressional review was not
available, and we could not discern whether EPA had reviewed some notifications.
Without knowledge of permit status and the resolution of comments, EPA may not be
able to determine whether its reviews have desired environmental impacts. Further, EPA
risks being out of compliance with the Federal Records Act.
EPA recently took actions that should improve documentation of the Agency's
Section 404 activities nationwide. EPA's Office of Water developed the Data on Aquatic
Resources Tracking for Effective Regulation system to alert staff of permit notifications
and to track information. However, EPA currently limits the system's implementation to
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Semiannual Report to Congress October 1, 2011—March 31, 2012
standard permits only, and the use of the system is not mandatory. We recommended that
EPA coordinate with headquarters and regions to identify the Data on Aquatic Resources
Tracking for Effective Regulation system as an official recordkeeping system and
develop a full implementation plan. EPA agreed with our recommendations.
(Report No. 12-P-0249, EPA Should Strengthen Records Management on Clean Water
Act Section 404 Permit Notification Reviews for Surface Coal Mining, February 2, 2012)
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Superfund
Superfund is the name given to the environmental program established to address
abandoned hazardous waste sites. It is also the name of the fund established by the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended. The Superfund Amendments and Reauthorization Act of 1986 requires the OIG
to annually audit the Superfund program and report the results to Congress.
One of the major entities included in EPA's financial statements is the Hazardous
Substance Superfund Trust Fund. Our audit of EPA financial statements for FY 2011 also
meets our Comprehensive Environmental Response, Compensation and Liability Act
requirement to annually audit the Superfund Trust Fund. EPA presented the financial
statements for FY 2011 in a consolidated format and did not include a separate
presentation on the Superfund Trust Fund. Details on the findings in the audit report of
the financial statements are on page 20 of this semiannual report.
EPA Should Improve Controls Over Superfund Site Five-Year
Reviews
Due to the lack of controls and procedures for EPA's review of Five-Year Review
reports for Superfund sites, EPA does not know the extent to which the regions
implemented recommendations and cannot be assured that its oversight is
effective.
Five-Year Review reports are required at Superfund sites that are not approved for
unlimited use and unrestricted exposure. These reports are intended to ensure that
protectiveness determinations are accurate, supported by available information, and
consistent in format nationwide. In 2007, EPA set a goal of reviewing at least 75 percent
of draft reports submitted by EPA regions and delegated that responsibility to the Office
of Superfund Remediation and Technology Innovation.
The Office of Superfund Remediation and Technology Innovation has not established
sufficient management controls to ensure that reports consistently meet quality standards
and adhere to guidance. Further, there is no formal process to resolve differences when
the office and the regions disagree on conclusions before final reports are released to the
public. Reviewers did not always follow up to determine whether the region implemented
recommendations, and regions sometimes disregarded valid comments.
We recommended that EPA establish a process to resolve disagreements with regions on
protectiveness determinations. We also recommended steps to improve the consistency,
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Semiannual Report to Congress October 1, 2011—March 31, 2012
thoroughness, and communication of Office of Superfund Remediation and Technology
Innovation reviews. The Agency agreed with the recommendations.
(Report No. 12-P-0251, Stronger Management Controls Will Improve EPA Five-Year
Reviews of Superfund Sites, February 6, 2012)
EPA Superfund Initiatives and Controls Reviewed as Required by
Congress
We conducted a congressionally required review on EPA's current efforts to
strengthen Superfund contracting controls to prevent waste, fraud, and abuse,
focusing on findings in 20 OIG reports.
EPA uses a variety of instruments, such as contracts and interagency agreements, to
clean up Superfund sites. In FY 2010, EPA obligated $413 million to contracts and
$244 million in interagency agreements to the U.S. Army Corps of Engineers.
We identified three EPA initiatives related to Superfund contracting controls:
(1) Contracts 2010 Strategy, (2) Office of Acquisition Management's Performance
Measurement and Management Program, and (3) Recovery Act Stewardship Plan.
In addition to those initiatives, EPA has other contract internal controls in place.
We identified 20 OIG audit reports issued to EPA since FY 2005 with recommendations
related to Superfund contracting controls. Corrective actions implemented as a result of
our recommendations included verifying the timeliness of contractor performance
evaluations, developing a process to ensure adjustment vouchers and monies owed to
EPA are tracked until receipt, and requiring that a cost-benefit analysis be conducted
prior to awarding a Cost-Plus-Award-Fee contract. We made no additional
recommendations.
(Report 12-P-0360, EPA Superfund Contract Initiatives and Controls to Reduce Fraud,
Waste, and Abuse, March 16, 2012)
EPA Has Completed Most Recommendations at Asheville
Superfund Site
EPA Region 4 took actions on all recommendations made in a 2010 EPA OIG
report regarding the CIS Superfund site in Asheville, North Carolina. The region
completed 8 of the 10 OIG recommendations and further actions are needed to
complete 2 recommendations.
In response to a congressional request, the OIG had issued Report No. 10-P-0130,
EPA Activities Provide Limited Assurance of the Extent of Contamination and Risk at a
North Carolina Hazardous Waste Site, on May 17, 2010. Trichloroethylene, a chemical
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
now known to be carcinogenic to humans, was used in manufacturing processes at the
site, and nearby springs and private drinking water wells have been found to be
contaminated with the chemical.
Regarding one recommendation, the region modified letters to residents communicating
well water sampling results by including a supplemental fact sheet in the letters.
However, the sheet does not conform to Region 4's 2010 standard operating procedure on
communicating environmental data to property owners
and tenants. For another recommendation, the region
revised the site's Community Involvement Plan but the
plan did not include a specific communication strategy
nor reflect the site's current National Priorities List
status and recent site activities. We also found that the
region did not have controls in place to ensure the site's
public informational repository is being kept up to date,
did not complete a report on a removal action pilot
study, and did not timely bill responsible parties
approximately $175,000 in federal government costs
incurred at the site. The billing lapse was an oversight
that has since been corrected.
.111 ill MM
This Water May Be Unsafe.
AVOID CONTACT.
DO NOT DRINK THE WATER.
For details contact the On-Scene Coordinator
for the Mills Gap Contamination Site at (404) 562-8705
Warning sign observed during OIG August 2011
site visit at the Asheville site. (EPA OIG photo)
We made recommendations to correct the issues noted, and Region 4 provided a
corrective action plan with milestone dates to address all of the recommendations.
(Report No. 12-P-0362, EPA Has Implemented Corrective Actions to Improve Conditions
at Asheville, North Carolina Superfiind Site, March 21, 2012)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Other Significant OIG Activity
Human Health and the Environment
EPA Should More Effectively Manage Nanomaterial Risks
EPA does not currently have sufficient information or processes to effectively
manage the human health and environmental risks of nanomaterials.
EPA has the authority to regulate nanomaterials, which the Agency defines as chemical
substances that are controlled at the scale of approximately one-billionth of a meter.
Nanomaterials are currently used in a wide variety of applications, including consumer
products, health care, transportation, energy, and agriculture.
x 1,000
DNA
Bacterium
ncn>rr
Large Raindrop
x 1 OO.OOO
Single-walled
Carbon Nanotube
Strand of Hair
House
lOmetm
Comparison of size and scale of nanomaterials. (National Nanotechnology Institute website)
EPA's management of the human health and environmental risks of nanomaterials is
limited by lack of risk information and reliance on industry-submitted data. After
minimal industry participation in a voluntary data collection program, the Agency has
proposed mandatory reporting rules for nanomaterials. However, even if mandatory
reporting rules are approved, the effectiveness of EPA's management of nanomaterials is
questionable. In addition, program offices do not have a formal process to manage the
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Semiannual Report to Congress October 1, 2011—March 31, 2012
potentially mandated information, and EPA is not communicating an overall message to
external stakeholders on policy changes and risks.
We recommended that EPA develop a process to assure effective dissemination and
coordination of nanomaterial information across relevant program offices. The Agency
agreed with our recommendation and provided a corrective action plan with milestone
dates.
(Report No. 12-P-0162, EPA Needs to Manage Nanomaterial Risks More Effectively,
December 29, 2011)
Use of Unapproved Asbestos Demolition Methods May Threaten
Public Health
In an early warning report issued to EPA Administrator Lisa P. Jackson, we noted
that EPA has authorized the use of unapproved methods to demolish buildings
containing asbestos, including at the Hanford Superfund Site near Richland,
Washington.
Asbestos is a human carcinogen that can lead to serious diseases. In 1973, EPA issued the
Asbestos National Emission Standards for Hazardous Air Pollutants to protect human
health by reducing exposure to asbestos during building demolitions and other activities.
Regulated asbestos-containing material must be removed by specially trained technicians
prior to demolition unless the building is structurally unsound and in danger of imminent
collapse.
Beginning in 1999, EPA considered alternative methods to augment the asbestos
standard, including the Alternative Asbestos Control Method, that leave some or all
regulated asbestos-containing material in place. Demolition equipment applies
mechanical forces that shred the asbestos-containing material, potentially releasing
asbestos fibers into the environment and endangering public health. Buildings are wetted
during demolition in an attempt to limit the release of asbestos fibers. However, EPA has
not approved or shown that these "wet" methods are protective of human health. In
July 2011, EPA's Office of Research and Development ended its research on the
Alternative Asbestos Control Method due to technical deficiencies. Nonetheless, our
preliminary research found that unapproved methods are currently being used, such as at
the Hanford Superfund Site, or are being considered at other sites. This use of
unapproved methods is counter to EPA regulations.
Our report stated that EPA should immediately communicate the Asbestos National
Emission Standards for Hazardous Air Pollutants requirements for the demolition of
asbestos-containing structures to regional, program, and field offices to prevent
potentially hazardous asbestos exposures. EPA should notify these offices that
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Semiannual Report to Congress October 1, 2011—March 31, 2012
unapproved methods are not to be used without obtaining appropriate waivers. Further,
EPA should identify all sites, such as Hanford, with work plans that contain EPA
authorization to use unapproved asbestos demolition methods and retract any such
approvals that deviate from the asbestos standard. In addition, EPA should assess whether
any authorizations resulted in potential asbestos exposure of workers or the public, and
notify them accordingly.
The initial Agency response indicated that EPA had already begun to investigate the
allegations of ongoing human-health threats from improper asbestos removal and
disposal, and the Agency will take whatever steps are necessary to protect the health of
anyone who might be exposed. If there have been past incidents of exposure, the Agency
stated it will take appropriate steps to identify them and to address any health threats.
(Report No. 12-P-0125, Early Warning Report: Use of Unapproved Asbestos Demolition
Methods May Threaten Public Health, December 14, 2011)
Clean Air Act Risk Management Program Inspections in
Certain States Should Not Be Conducted by Contractors
EPA has used contractors to perform Clean Air Act risk management program
inspections in three states in contravention of court decisions and an EPA policy
memo that incorporated the decisions.
Under the Clean Air Act Section 112(r) risk management program, stationary sources
that have more than the threshold quantity of regulated substances on-site in any one
process must implement a risk management program. All covered facilities must submit a
Risk Management Plan to EPA that describes and documents the facility's hazard
assessment and its prevention and response programs. Inspections of these programs are
to be conducted by authorized representatives of the EPA Administrator. Compliance
with risk management program requirements helps to prevent accidents and mitigate the
harm to human health and the environment from those that do occur.
Case law is split on the use of contractors to perform Clean Air Act Section 112(r)
inspections. The Sixth and Tenth Circuit Courts of Appeal have ruled that contractors may
not be designated by EPA as authorized representatives of the Administrator, while the
Ninth Circuit Court of Appeals has ruled that contractors can be so designated. In a
January 1984 decision the Supreme Court left unresolved the pre-existing split in the
circuit courts on the question of EPA's statutory authority to use contractors for Clean Air
Act inspections. Subsequently, EPA issued a policy memo, on February 22, 1984, stating
that contractors should not, absent express permission from headquarters, be designated as
representatives of EPA to conduct Clean Air Act inspections in states located in the Sixth
and Tenth Circuits. However, EPA used contractors in three states within the Sixth and
Tenth Circuits—Kansas, Kentucky, and Tennessee—to conduct such inspections.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
In an early warning report, we told EPA to immediately review the legality and
appropriateness of its practice of using contractors to perform Clean Air Act
Section 112(r) risk management program inspections in the states covered by the
Sixth and Tenth Circuit Courts of Appeal. If needed, based on the results of its review,
EPA should take immediate action to eliminate or revise its use of contractors to conduct
risk management program inspections.
(Report No. 12-P-0376, Early Warning Report: Use of Contractors to Conduct
Clean Air Act Risk Management Program Inspections in Certain States Goes Against
Court Decisions, March 28, 2012)
EPA Should Ensure Drinking Water State Revolving Funds Are
Helping Communities Most in Need
Although EPA and the states use the Drinking Water State Revolving Fund to
assist communities in achieving or maintaining compliance with drinking water
standards, some high-priority systems were not aware of the program.
The Drinking Water State Revolving Fund program provides states with the means to
establish a revolving fund to provide low-cost loans to public water systems, and other
funding through set-asides, to further public health protection. In FY 2010, EPA allotted
nearly $1.4 billion for state Drinking Water State Revolving Fund programs.
The program is not taking full advantage of the available data and tools, and is not
coordinating with enforcement programs, to identify systems that are not in compliance
with the Safe Drinking Water Act and may benefit from program funding. The Safe
Drinking Water Act requires that funding priority be given to systems most in need and
projects that address the most serious risk to human health. However, some noncompliant
community systems with the highest number of health-based violations were not applying
for state revolving funds but were resolving violations in other ways.
We recommended that EPA include in the annual regional review of states an assessment
of the coordination between state Drinking Water State Revolving Fund and enforcement
programs. We also recommended that EPA create a national intended use plan review
checklist that includes a requirement to assess coordination between state Drinking Water
State Revolving Fund and enforcement programs. EPA agreed with all of our
recommendations and provided milestone dates for each recommendation.
(Report No. 12-P-0102, Enhanced Coordination Needed to Ensure Drinking Water
State Revolving Funds Are Used to Help Communities Not Meeting Standards,
December 1, 2011)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Agency Business Practices and Accountability
EPA Earns Unqualified Opinion on Financial Statements
We rendered an unqualified opinion on EPA's Consolidated Financial Statements
for FYs 2011 and 2010, meaning that they were fairly presented and free of
material misstatement. However, we noted the following significant deficiencies:
• Regions and headquarters did not timely provide accounts receivable supporting
documentation.
• EPA did not timely bill other federal agencies for reimbursable costs.
• EPA did not properly close general ledger accounts in its cancelling Treasury
symbols.
• EPA double counted contractor-held property.
• EPA headquarters could not account for 1,284 personal property items.
• EPA needs to better secure marketable securities.
• EPA recorded earned revenue without recognizing corresponding expenses.
• EPA is withholding payments related to the BP Deepwater Horizon oil spill.
We also noted a noncompliance issue involving EPA's Oil Spill Response Account in
relation to the BP Deepwater Horizon oil spill response. EPA violated the Antideficiency
Act in November 2010 because it made expenditures in excess of funds available. Also,
to avoid a second potential Antideficiency Act violation, EPA delayed payments to
vendors, resulting in the Agency losing discount opportunities and being required to
make interest penalty payments to vendors as required by the Prompt Payment Act.
The Agency did not concur with our finding on cancelling Treasury symbols causing
inappropriate balances. The Agency believes that it is following Treasury instructions and
the balances are proper. While the amounts are not material to the financial statements,
by reversing the receivable, the Agency has understated FY 2011 income and bad debt
expense related to cancelling the Treasury symbol. The Agency agreed with our other
findings and recommendations.
(Report No. 12-1-0073, Audit of EPA's Fiscal 2011 and 2010 Consolidated Financial
Statements, November 15, 2011)
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Semiannual Report to Congress October 1, 2011—March 31, 2012
EPA Can Improve Reporting of Improper Payments
EPA complied with the 2010 Improper Payments Elimination and Recovery Act in
that it reported all required information on improper payments. However, EPA
can improve the accuracy and completeness of that information.
Each year, the federal government wastes taxpayer dollars on improper payments to
individuals, organizations, and contractors. The Improper Payments Elimination and
Recovery Act requires agencies to report on improper payments, and inspectors general
are required to determine whether agencies are in compliance with the Act.
EPA reported the results of its efforts to recapture improper payments, and is taking
actions to improve internal controls in preventing, reducing, and recapturing improper
payments. However, EPA did not report all improper payments identified in audits and
reviews of grants to tribes, state and local governments, and universities in the Fiscal
Year 2011 Agency Financial Report. As a result, EPA understated grant improper
payments by thousands of dollars. Also, EPA did not report discounts not taken as
improper payments, and did not correctly calculate improper payments reported.
We recommended that EPA issue guidance requiring that the results of all grant improper
payment determinations and recaptures, as well as discounts not taken as improper
payments, be reported. We also recommended that EPA issue guidance to program
offices to ensure the quality of reported information. EPA agreed with our
recommendations, except for the recommendation on including discounts not taken as
improper payments.
(Report No. 12-P-0311, EPA Can Improve Its Improper Payments Reporting,
March 1, 2012)
Grantee Labor Costs of $96,615 Questioned
Although labor costs claimed by the Summit Lake Paiute Tribe under EPA grants
were generally supported by timesheets, we questioned labor costs claimed of
$96,615.
The Summit Lake Paiute Tribe, Sparks, Nevada, receives financial assistance from EPA
under various programs. Although our transaction tests showed that labor costs claimed
by the tribe under the EPA grants were generally supported by timesheets, we found four
timekeeping issues that caused us to question $96,615 in labor costs. Also, additional
work remains to be done by the tribe in response to issues on deferred revenues and
updating policies and procedures that had been noted in single audit reports.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
We recommended that EPA disallow and recover the $96,615 and require the tribe to
implement certain internal controls. EPA agreed with our recommendations, but the tribe
disagreed with the recommendation to disallow the $96,615.
(Report No. 12-2-0072, Agreed-Upon Procedures Applied to EPA Grants Awarded to
Summit Lake Paiute Tribe, Sparks, Nevada, November 10, 2011)
Grantee Costs Claimed of $80,721 Questioned
Grant recipient Kathleen S. Hill did not have a financial management system that
met federal standards, and we questioned $80,721 claimed.
EPA competitively awarded Cooperative Agreement X7-83325501 on October 26, 2006,
to Hill, an individual, to support the creation and administration of a national tribal water
program council. EPA's contribution to the project was 100 percent of approved costs up
to $800,000.
The recipient did not have adequate controls to ensure that costs claimed were in
accordance with Code of Federal Regulations requirements. In addition, the recipient's
cash draws did not comply with Code of Federal Regulations requirements or the terms
and conditions of the cooperative agreement. As a result, of the $726,587 claimed under
the cooperative agreement, we questioned $80,721 of ineligible fringe benefit, travel and
per diem, supplies, and contractual costs.
We recommended that EPA disallow and recover $80,721 in questioned costs, verify that
the recipient has an adequate financial management system prior to any future award, and
verify that the recipient's final financial status report is properly supported. EPA
generally agreed with the findings with the exception of fringe benefits. The recipient
generally disagreed with the findings and recommendations.
(Report No. 12-4-0224, Examination of Costs Claimed Under Cooperative Agreement
X7-83325501 Awarded to Kathleen S. Hill, Chiloquin, Oregon, January 23, 2012)
EPA Should Ensure Effective Defense Contract Audit Agency
Audit Report Resolution
EPA should improve its policies and procedures to ensure the timely resolution of
Defense Contract Audit Agency (DCAA) reports. With timely resolution, EPA may
be able to deobligate funds that can be used for other priorities.
DCAA performs contract audit services for EPA. Through the end of 2008, the EPA OIG
requested, tracked, and reported DCAA audits until resolution, and EPA tracked the
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
corrective actions until implementation. On January 1, 2009, the OIG transferred its
requesting, tracking, and reporting responsibilities to EPA.
EPA's policies and procedures do not ensure timely and accurate tracking and reporting
of DCAA report resolution. EPA does not always report the status of unresolved DCAA
audits to the Administrator, accurately record the management decision dates, resolve
DCAA reports within 6 months when EPA is not the cognizant agency, or accurately
define when DCAA audits are resolved. Reasons for not resolving some audits within
1 year follow.
Reasons audits remained unresolved
Awaiting negotiations with cognizant agency (agency with
largest dollar amount of contracts)
Cognizant agency stated audit was resolved but was unable to
provide supporting documentation
Cognizant agency awaiting additional DCAA audit work
Cognizant agency unaware whether corrective action was taken
Number
6
4
4
2
Source: OIG analysis.
We recommended that EPA develop and/or revise and implement policies and procedures
to ensure that unresolved DCAA audit reports are reported on a semiannual basis to the
EPA Administrator, to record management decision and final action dates, and to define
the point of resolution for the various types of DCAA audits. EPA agreed with all of our
recommendations and provided milestone dates for each recommendation.
(Report No. 12-P-0071, EPA Should Improve Policies and Procedures to Ensure
Effective DCAA Audit Report Resolution, November 10, 2011)
Managing Cost-Reimbursement Contracts Can Be Improved
EPA did not comply with several key revisions to the Federal Acquisition
Regulation regarding the use of cost-reimbursement contracts.
The Duncan Hunter National Defense Authorization Act for FY 2009 required the
Federal Acquisition Regulations to be revised to address the use of cost-reimbursement
contracts. The Federal Acquisition Regulation was revised on March 16, 2011, by the
interim rule, Proper Use and Management of Cost Reimbursement Contracts.
Although EPA complied with several revisions, those tended to be areas where the new
rules expanded on requirements already in existence. We found that the contract files
reviewed generally did not have documentation of discussions on minimizing the use of
other than firm-fixed-price contracts on future acquisitions, consideration as to whether
portions of the contract could be established on a firm-fixed-price basis, and a written
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Semiannual Report to Congress October 1, 2011—March 31, 2012
acquisition plan. Also, EPA did not always nominate or appoint contracting officer's
representatives in writing.
We recommended that EPA develop a policy that provides a standardized approach for
preparing written acquisition plans. We also recommended that EPA update the
procurement initiation notice to include a copy of the contracting officer's representative
appointment memorandum. EPA concurred with our recommendations and provided
milestone dates.
(Report No. 12-P-0320, Policies Needed for Proper Use and Management of
Cost-Reimbursement Contracts Based on Duncan Hunter Act, March 6, 2012)
Managing Enforcement and Inspection Credentials Can Be Improved
Some internal controls over managing enforcement and inspection credentials for
EPA employees were not being implemented, and some safeguards could be
improved.
EPA's Office of Administration and Resources Management and Office of Enforcement
and Compliance Assurance manage credentialing of EPA and non-EPA compliance
employees in accordance with EPA Order 3510, "EPA Federal Credentials for
Inspections and Enforcement of Federal Environmental Statutes."
In Region 3, where we conducted an in-depth review, we initially found that the required
annual 10 percent inventory of credentials had not been completed for EPA personnel
and the inventory had not been documented for non-EPA personnel. As of February 15,
2012, EPA personnel informed us that all regions, with the exception of Region 5, have
completed their EPA employee credential inventory for 2011. Also, there is no timeline
requirement for EPA employees to report the loss/theft of a credential. The requiring of
only signatures and not printed names on credential justification forms can result in
illegible signatures, making identifying the parties on the form difficult. Further, EPA
Order 3510 does not identify what level of authority is required to approve a request for a
credential.
We recommended that EPA comply with the internal controls of EPA Order 3510 and
revise the order to include certain provisions that will improve enforcement and
inspection credentialing. EPA agreed with all our recommendations and provided
milestone dates.
(Report No. 12-P-0328, Improvement Required to Safeguard Enforcement and Inspection
Credentials, March 9, 2012)
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Training Contractor Not Promptly Paid
EPA did not pay the Laboratory for Scientific Interrogation, Inc. (LSI) for services
rendered in 2007 because EPA did not receive an invoice from the company until
after a July 2011 congressional inquiry.
In March 2007, EPA issued purchase order EP07H001074 to LSI, of Phoenix, Arizona,
for training seminars for the OIG. The price set in the purchase order was $4,000.
LSI presented separate 1-day seminars to OIG staff on May 9 and May 10, 2007.
EPA did not pay LSI for services rendered because it did not receive an invoice from LSI
until after the July 2011 congressional inquiry. Contrary to regulation, the EPA contracting
officer in the Office of Administration and Resources Management apparently did not
provide LSI with a copy of the purchase order for the training. Because LSI did not receive
a purchase order, it did not properly submit its invoice and did not know who to contact
when the invoice was not promptly paid. In June 2008, OIG staff realized that LSI had not
submitted an invoice, but no one in the OIG contacted LSI or the contracting officer. After
the congressional inquiry, the OIG obtained an invoice from LSI that exceeded the price in
the purchase order because it included $1,032 in instructor travel costs. EPA modified the
purchase order to include the travel costs, but we found no evidence that the travel was
authorized. In November 2011, EPA paid LSI $5,032.
We recommended that the Inspector General take actions to ensure that invoices are
obtained, reviewed, and paid within a reasonable period of time after receiving services.
We also recommended that the Office of Administration and Resources Management
require that contracting officers properly document contract actions in contract files.
The recommendation addressees agreed with the recommendations.
(Report No. 12-P-0160, Training Contractor Not Promptly Paid Under Purchase Order
EP07H001074, December 28, 2011)
EPA Should Revise Policy on Financing Local Reserves
EPA policy that allows states to use State Revolving Fund dollars to establish
local reserve accounts conflicts with other regulations and results in the funding
not being available for needed wastewater and drinking water projects.
The Clean Water Act and Safe Drinking Water Act authorize EPA to award grants to
states that have established Clean Water and Drinking Water State Revolving Fund
programs. States use these grants to capitalize revolving funds from which low-cost loans
and other types of assistance are provided to finance infrastructure projects. The EPA
policy that allows states to use State Revolving Funds to establish local reserve accounts
conflicts with other regulations. The financing of local reserve accounts does not
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Semiannual Report to Congress October 1, 2011—March 31, 2012
represent eligible incurred project costs, which is a requirement for cash draws from the
federal capitalization grants per the Code of Federal Regulations, and such financing
prevents the funds from being available for needed projects.
We recommended that EPA rescind its guidance allowing federal funds to be used to
finance local reserve accounts. The Agency agreed to issue a memorandum to the states
with instructions that only non-federal State Revolving Fund monies may be used to
finance local reserves.
(Report No. 12-P-0231, EPA Policy on Financing Local Reserves Needs Revision,
January 25, 2012)
EPA's Computer Security Program Should Be Improved
Our annual review of EPA's implementation of the Federal Information Security
Management Act, submitted to OMB, disclosed that security management for
several Agency programs should be improved.
The audit work performed during the review disclosed that the Agency needs to make
significant improvements in the following programs: Risk Management, Plans of Action
and Milestones, and Continuous Monitoring Management. In addition, audit work noted
significant weaknesses with several aspects of EPA's information security program.
(Report No. 12-P-0062, Fiscal Year 2011 Federal Information Security Management Act
Report: Status of EPA 's Computer Security Program, November 9, 2011)
Region 10 Security Vulnerabilities Increase Risk to EPA's Network
Review of physical and environmental controls of the Region 10 computer room
found that sufficient protections were not in place to safeguard critical information
technology assets and associated data from the risk of damage and/or loss.
This audit, conducted in support of our annual audit of EPA's compliance with the
Federal Information Security Management Act, sought to identify technical
vulnerabilities associated with the Agency's network devices in EPA's Region 10
headquarters building, and to assess the security posture of the Region 10 computer
room.
Technical vulnerability scans disclosed a multitude of high-risk and medium-risk
vulnerabilities on Region 10 servers, printers, and/or desktops. The exploitation of
unidentified and unremediated vulnerabilities could greatly impact the network security
posture of Region 10 headquarters and/or the entire EPA network by exposing Agency
data, information, and configurations to unauthorized access.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
We recommended that EPA Region 10 remediate the technical vulnerabilities as well as
physical and environmental control deficiencies.
(Report No. 12-P-0220, Region 10 Technical and Computer Room Security
Vulnerabilities Increase Risk to EPA 's Network, January 20, 2012)
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Investigations
Business Owner Sentenced to Jail for Making False Statements
On February 22, 2012, Charles Tomlin was sentenced in U.S. District Court,
Northern District of Georgia, to 20 months in jail to be followed by 36 months of
supervised release for making false statements. Tomlin was also ordered to pay
a $5,000 fine, $43,331 in restitution, and a $100 special assessment. Tomlin was
found guilty during a 2-day trial in December 2011 of fabricating a story in which
he claimed persons posing as EPA employees had assessed him $272,000 in
fines for alleged environmental violations on his business property.
Tomlin is the owner of Street Dreams, a vehicle repair and customizing business formerly
located in Gainesville, Georgia. In early November 2010, Tomlin alleged that two EPA
agents visited his business and assessed up to $2 million in fines based on debris,
including tires and batteries, which had contaminated soil and water. The EPA OIG
investigation began with the belief that Tomlin was a victim of people posing as EPA
agents and attempting to defraud him. However, as the investigation progressed, special
agents became suspicious of Tomlin after he failed to record phone conversations with
the alleged EPA agents and falsely claimed one of the alleged EPA agents pulled into an
abandoned car wash adjacent to the property during surveillance. After the investigation,
it was alleged that Tomlin falsified the claims to avoid paying rent on the business. The
investigation cost taxpayers more than $43,000, which the judge in the case awarded as
restitution to the EPA OIG.
Former Sewage Treatment Plant Operator Sentenced to Prison for
Falsifying Monitoring Reports
On February 6, 2012, Donald Jack Clark of Niota, Tennessee, was sentenced in
the U.S. District Court for the Eastern District of Tennessee to 6 months in prison
to be followed by 2 years of supervised release, including 6 months of home
detention following his release from prison, for falsifying Clean Water Act reports.
Clark was also ordered to perform 150 hours of community service and pay a
$1,200 special assessment.
The sentence was the result of a guilty plea to 12 counts of making false documents
required under the City of Niota's National Pollutant Discharge Elimination System
permit under the Clean Water Act. The indictment charged Clark with falsifying monthly
discharge monitoring reports and monthly operating reports from January 2008 through
December 2010. The falsifications were intended to cover up Clark's failure to properly
operate the sewage treatment plant's chlorination system, designed to disinfect waste
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Semiannual Report to Congress October 1, 2011—March 31, 2012
water prior to its discharge into a local waterway. Clark had been a licensed wastewater
treatment plant operator for over 14 years at the time of the incidents.
This investigation was conducted with the EPA Criminal Investigation Division.
Two Tribal Coalition Employees Sentenced for Embezzlement
On November 29, 2011, Shirley Rouillard and Gaylin Holy Rock, of Oglala, South
Dakota, were sentenced in U.S. District Court, District of South Dakota, Western
Division, for theft of federal and/or tribal funds. Rouillard and Holy Rock are
former employees of the Mni Sose Intertribal Water Rights Coalition (Mni Sose),
an entity funded almost entirely by federal grants.
Rouillard was sentenced to serve 18 months in prison, to be followed by 36 months of
probation. She was also ordered to make restitution of $88,734 to EPA and $66,000 to the
U.S. Bureau of Reclamation. Holy Rock was ordered to serve 24 months on probation
and make restitution of $1,009 to EPA and $1,009 to the U.S. Bureau of Reclamation.
Rouillard, Holy Rock, and others made an agreement to embezzle funds from the Mni
Sose by cashing checks drawn from Mni Sose funds and keeping the money for their own
personal gain. Checks were disguised as legitimate transactions for Mni Sose-related
work but the funds were not used for Mni Sose purposes. The conspiracy included
120 fraudulent transactions and resulted in the embezzlement of $156,753 from the
Mni Sose.
This investigation was conducted with the U.S. Department of Interior, Office of
Inspector General.
Former EPA Employee Sentenced to 5 Years for Child Pornography
On October 24, 2011, Jonathan Angier, a former EPA employee, was sentenced
in U.S. District Court, District of Maryland, to 5 years in prison followed by
supervised release for life for charges related to receipt of child pornography.
Angier, who must register as a sex offender, was also assessed a $1,000 fine
and ordered to pay a $100 special assessment.
Angier was identified by the U.S. Postal Inspection Service as having previously ordered
videos from a website that contained images of children engaged in sexually explicit
activity. Angier responded to an offer from another website and placed an order for similar
additional DVDs through a series of several e-mails. At least one of the e-mails was sent
through an Internet Protocol address that was identified as an address used by EPA.
This investigation was conducted with the U.S. Postal Inspection Service.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Former EPA Employee Sentenced to 5 Months for Perjury and
Obstruction of Justice
On March 28, 2012, Keith Phillips was sentenced to 5 months in jail, to be
followed by 24 months of probation (including 5 months of home detention),
stemming from charges related to perjury and obstruction of justice. Phillips was
also ordered to perform 200 hours of community service and pay an $8,000 fine
and a $200 special assessment.
Phillips, a former Special Agent with the EPA Criminal Investigation Division, lied under
oath to conceal an extramarital affair with a Federal Bureau of Investigation agent that
led to the malicious and wrongful federal indictment of an oil refinery. The refinery's
manager filed a civil suit against the federal government for malicious prosecution after
his criminal environmental charges were dismissed. It was during the civil trial that
Phillips lied in a deposition when he denied having a sexual relationship with his joint
investigator. Phillips was also dishonest when he testified before the grand jury that heard
the criminal case and handed down the indictment. The refinery manager was awarded
$1.6 million in damages for his malicious prosecution. Phillips was terminated from EPA
in July 2011.
Owner of Firm Charged in Scheme to Sell Over $9 Million in
Fraudulent Renewable Fuel Credits
On November 8, 2011, a criminal indictment was filed in U.S. District Court for
the District of Maryland charging Rodney R. Hailey, of Perry Hall, Maryland, with
wire fraud, money laundering, and a violation of the Clean Air Act. These charges
were made in connection with a scheme in which Hailey allegedly sold $9 million
in renewable fuel credits purportedly produced by his company, Clean Green
Fuel, LLC, when in fact the company did not produce any renewable fuel.
It is alleged that as the owner of Clean Green Fuel, LLC, Hailey specialized in producing
38-digit renewable identification numbers, each of which supposedly corresponded to the
production of two-thirds of a gallon of biodiesel fuel. Hailey allegedly sold more than
32 million renewable identification numbers, representing 22 million gallons of
bio-diesel fuel, for over $9 million. Oil companies bought renewable identification
numbers to comply with EPA regulations requiring them to support the production of
renewable fuel. However, it is alleged that Hailey did not produce any renewable fuel but
just made up renewable identification numbers. Hailey allegedly did not have a facility
capable of producing bio-diesel fuel and his business operation consisted solely of
generating false renewable identification numbers on his computer and marketing them to
brokers and oil companies. During the investigation, Hailey allegedly made numerous
false statements to EPA investigators, including that he manufactured the fuel from waste
vegetable oil collected from 2,700 restaurants.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Hailey allegedly used the proceeds of the wire fraud scheme to purchase luxury vehicles,
including BMWs, Mercedes Benz', a Rolls Royce Phantom, a Lamborghini, a Ferrari,
and a Maserati, as well as real estate and jewelry. To date, over $3 million in property
alleged to be the proceeds of the scheme has been seized.
This investigation was conducted as part the District of Maryland Asset
Forfeiture/Money Laundering Task Force, including the U.S. Marshals Service, the
Baltimore County Police Department, and the Internal Revenue Service-Criminal
Investigation; the EPA Criminal Investigation Division; the U.S. Postal Inspection
Service; and the EPA OIG.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Testimony
Fostering Quality Science at EPA Topic of Inspector General
Testimony
Inspector General Elkins appeared before the Subcommittee on Energy and
Environment, Committee on Science, Space and Technology, of the House of
Representatives, on November 17, 2011, to discuss OIG work related to EPA's
Office of Research and Development (ORD).
The Inspector General noted that the OIG made several recommendations in an April
2009 report to ORD to improve its peer review process. Peer review is a process for
enhancing a scientific or technical work product so that the decision or position taken by
EPA has a sound, credible basis. We noted issues with EPA guidance for peer review
panels relating to impartiality and conflict of interest. ORD agreed to act on all our
recommendations on peer reviews, and we certified that EPA completed corrective
actions.
Mr. Elkins noted that it is critical that EPA's scientific and technical activities be of the
highest quality and credibility, as EPA decision making relies on science. Since 2000, a
number of federal and EPA policies on ensuring the integrity of government science have
been issued. In July 2011, the OIG reported that ORD has internal controls that include
policies, procedures, training, and peer review, but ORD should improve how it evaluates
the effectiveness of its policies and procedures for scientific integrity and research
misconduct. ORD agreed with our recommendations.
In a February 2009 report, the Inspector General noted we looked at how well EPA
policies, procedures, and plans help ensure that its climate change research fulfills its role
in climate change. We found that EPA did not have an overall plan to ensure developing
consistent, compatible climate change strategies across the Agency. We surveyed EPA
regions and offices and found they needed more information on a variety of climate change
topics. The lack of an overall climate change policy can result in duplication, inconsistent
approaches, and wasted resources among EPA's regions and offices. We made several
recommendations to ORD to establish various management controls to ensure EPA fulfills
its emerging climate change role and related information needs. ORD agreed with our
recommendations and has certified that all corrective actions have been completed.
Inspector General Elkins concluded by noting that ORD has been receptive to many of
the OIG's recommendations on improving ORD's operations and activities so it can
better provide the solid underpinning of science and technology necessary for EPA
regulatory decision-making, and we will continue to identify areas for improvement.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Inspector General Testifies on How EPA Can Cut Spending
On October 12, 2011, Inspector General Elkins appeared before the
Subcommittee on Oversight and Investigations, Committee on Energy and
Commerce, of the House of Representatives, to discuss opportunities for cost
savings and greater efficiencies within EPA. His testimony focused on findings in
recent OIG reports.
With respect to workload and workforce management, Mr. Elkins informed the
subcommittee that EPA cannot demonstrate that it has the right number of resources to
accomplish its mission, and EPA leadership lacks reasonable assurance that it is using
personnel in an effective and efficient manner to achieve mission results. Further, other
OIG work has identified potential efficiencies related to EPA utilization of space and
facilities, as well as information technology.
Mr. Elkins noted EPA can also improve its management of unliquidated obligations.
Unliquidated obligations represent the unexpended balance remaining from the amount
of funds EPA obligates for a grant. During FY 2010, the OIG identified over
$14 million in several programs that could be deobligated. For example, we identified
over $6.1 million of unneeded funds that should have been deobligated for three grants
awarded by EPA to the District of Columbia. As a result of our audit work,
EPA deobligated the funds, thus freeing the money up for use on other projects.
EPA operates several programs where it assesses and collects fees and recovers its costs.
These fees and recoveries are used to offset some of the costs EPA incurs for managing
and overseeing the programs. The Inspector General noted OIG reviews of two
programs—the Motor Vehicle and Engine Compliance Program and the Superfund
program—indicate that EPA could improve how it recovers these costs.
Inspector General Elkins told the subcommittee that the OIG has been a positive agent of
change by making significant contributions toward helping EPA improve in all these
areas, and EPA will need to intensify its efforts to control costs and maximize the
benefits from the resources entrusted to it.
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Other Activities
Peer Reviews Conducted
The U.S. Department of Health and Human Services OIG is conducting an external
peer review of the EPA OIG covering the period October 1, 2008, through
September 30, 2011. The entrance conference was held on November 14, 2011, and
field work was underway as of the end of this semiannual reporting period. The
review is being conducted in accordance with Government Auditing Standards and
guidelines established by the Council of the Inspectors General on Integrity and
Efficiency. The most recent prior external peer review of the EPA OIG had been
conducted by the U.S. Department of Homeland Security OIG. That prior report,
issued July 10, 2009, contained no recommendations, and the EPA OIG received a
rating of pass.
The EPA OIG will be conducting an external peer review of the system of quality
control for the audit organization of the U.S. Department of Agriculture OIG. Our
review will cover the period April 1, 2009, through March 31, 2012. This review will
also be conducted in accordance with Government Auditing Standards and guidelines
established by the Council of the Inspectors General on Integrity and Efficiency. The
entrance conference for the U.S. Department of Agriculture OIG was scheduled for
April 2012. Our most recent completed external peer review of another agency was
conducted on the audit organization for the Treasury Inspector General for Tax
Administration. Our review of that organization covered the period April 1, 2006,
through March 31, 2009. Our report, issued February 3, 2010, provided the Treasury
Inspector General for Tax Administration a rating of pass.
Legislation and Regulations Reviewed
Section 4(a) of the Inspector General Act requires the Inspector General to review
existing and proposed legislation and regulations relating to the program and operation of
EPA and to make recommendations concerning their impact. We also reviewed drafts of
OMB circulars, memoranda, executive orders, program operations manuals, directives,
and reorganizations. The primary basis for our comments are the audit, evaluation,
investigation, and legislative experiences of the OIG, as well as our participation on the
Council of the Inspectors General on Integrity and Efficiency. During the reporting
period, we reviewed 69 proposed changes to legislation, regulations, policy, procedures,
and other documents that could affect EPA and/or the Inspector General, and provided
comments on 4. Details on two items follow.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
OMB's Proposed Executive Order, Promoting Efficient Spending. OMB's proposed
executive order would direct executive departments and agencies to take certain actions
to promote efficient spending. While we strongly support the executive order's intended
reductions in wasteful government expenditures on travel, printing, and other purchases,
we are concerned that certain provisions in the executive order give authority to agency
officials over OIG expenditures that could undermine inspector general independence.
The concern is that travel by OIG employees, particularly criminal investigators, would
be subject to scrutiny by the agency senior level official for a determination of whether
that travel complied with the "local first" requirement. Similarly, the agency senior level
official could make determinations as to whether agents can effectively perform their
function through video conferencing or teleconferencing rather than in-person interviews.
We believe these determinations should be made by inspectors general, not agency
officials.
Proposed New EPA Order 3221, Foreign Visitors and Assignments Program.
EPA's Office of Homeland Security proposed a new EPA Order 3221. The new order
establishes EPA's Office of Homeland Security as the lead for the implementation and
oversight for the documentation and review process of all foreign visitors who access
EPA facilities to safely promote the continuation of exchanging mutually beneficial
policy. We raised concerns that the draft order encroaches upon the inspector general's
independence because certain provisions appeared to require the inspector general to
report to agency officials and get clearance prior to contacting a foreign subject or
witness of an on-going investigation, audit, or evaluation.
Working Paper Software Champions and Trainers Program Initiated
In January 2012, the EPA OIG implemented a "Champions and Trainers" program to
address functional questions and provide training for OIG staff on the OIG's database
that contains, organizes, and displays OIG electronic working papers for audit and
program evaluations. EPA OIG expects this program to enhance the efficiency of
auditors and evaluators by enabling them to more easily accomplish tasks for
documenting the evidence supporting project results.
The champions answer questions from both new and existing staff, help resolve
functional problems, and share tips and lessons learned. Champions also participate in
OIG efforts to improve processes related to working papers. The trainers teach staff on
how to use software both one-on-one and through classroom courses as needed. A future
goal is to develop and provide Web-based courses and Internet help screens.
OIG Issues Tenth Annual Performance Report
The EPA OIG issued its tenth Annual Performance Report summarizing OIG activity,
performance, results, and challenges for FY 2011. The report provides a financial
35
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Semiannual Report to Congress October 1, 2011—March 31, 2012
accounting of resources for FY 2011 compared to our FY 2011 annual performance
targets. This report supplements, with greater quantitative and narrative detail, the OIG
summary performance results presented in the Agency's Fiscal Year 2011 Agency
Financial Report and Fiscal Year 2011 Annual Performance Report, in compliance with
the Government Performance and Results Act Modernization Act.
As described in the report, the OIG exceeded three of its four annual performance goal
targets during FY 2011, with two of the targets significantly exceeded. For the fourth, the
OIG achieved over 94 percent of the goal target. The OIG increased its focus on
identifying cost efficiencies through performance audits and program evaluations. As a
result, the OIG identified questioned costs, efficiencies, fines, settlements, and recoveries
totaling over $82.4 million, which is a more than 150 percent return on investment
compared to the OIG's FY 2011 budget. Additionally, EPA sustained over $54.7 million
in OIG monetary recommendations and savings from current and prior periods. Further,
during FY 2011, the OIG improved the overall quality and efficiency of its products by
reducing the production cycle time and resources required to perform OIG work. The
OIG also expanded its follow-up efforts, resulting in greater implementation of long-
outstanding recommendations.
The full report is at http://www.epa.gov/oig/reports/2012/AnnPerfReportFY2011 .pdf
OIG Issues Annual Plan for FY 2012
The EPA OIG issued its FY 2012 annual workplan of mandated and selected assignment
topics continuing from FY 2011 and scheduled to start in FY 2012. For this plan, OIG
work that is not mandated is selected through a rigorous process to develop a portfolio of
assignments that represent the best possible return on investment in addressing the needs,
risks, challenges, priorities, and opportunities of OIG customers, clients, and
stakeholders. We conducted considerable outreach to Agency leaders and stakeholders to
identify and assess environmental and management risks, challenges, and opportunities,
and invited our entire staff to provide assignment suggestions. The annual plan,
constructed to implement the OIG Strategic Plan, allows for unforeseen work and new
priorities that may be requested by hotline complaints, Agency leadership, and Congress.
The FY 2012 annual plan is at
htto://www.epa.gov/oig/reports/2012/EPA OIG FY2012 AnnualPlan.pdf
36
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
U.S. Chemical Safety and Hazard Investigation Board
The U.S. Chemical Safety and Hazard Investigation
Board (CSB) was created by the Clean Air Act
Amendments of 1990. CSB's mission is to investigate
accidental chemical releases at facilities, report to the
public on the root causes, and recommend measures to
prevent future occurrences.
In FY 2004, Congress designated the EPA Inspector General to serve as the Inspector
General for CSB. As a result, the EPA OIG has the responsibility to audit, evaluate,
inspect, and investigate CSB's programs, and to review proposed laws and regulations to
determine their potential impact on CSB's programs and operations. Details on our work
involving CSB are at http://www.csb.gov/service.default.aspx.
CSB Can Improve Reporting of Improper Payments
CSB was not fully compliant with the reporting requirements of the 2010
Improper Payments Elimination and Recovery Act regarding recovery audits.
Each year, the federal government wastes billions of taxpayer dollars on improper
payments to individuals, organizations, and contractors. The Improper Payments
Elimination and Recovery Act requires agencies to report on improper payments, and
inspectors general are required to determine whether agencies are in compliance with the
Act.
As required, CSB published its Performance and Accountability Report on its website.
Because CSB does not meet the minimum risk assessment threshold it is not required to
perform risk assessments. However, CSB had not determined the cost effectiveness of
performing recovery audits for each of its programs or activities that expend $1 million
or more annually. Consequently, CSB may be failing to identify and recover improper
payments that could be used to further its mission of chemical accident prevention.
Further, we were unable to evaluate the accuracy and completeness of the CSB's
reporting or CSB's performance in preventing, reducing, and recapturing improper
payments.
We recommended that CSB conduct an analysis to determine the cost effectiveness of
performing recovery audits on all activities with annual outlays exceeding $1 million, and
provide it to the Inspector General as required. CSB concurred with our recommendation
and has completed its analysis.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
(Report No. 12-P-0312, U.S. Chemical Safety and Hazard Investigation Board Should
Determine the Cost Effectiveness of Performing Improper Payment Recovery Audits,
March 1, 2012)
CSB Can Improve Information Security Practices
CSB has an information security program in place that appears to be functioning
as designed. CSB takes information security weaknesses seriously, as three of
the four prior-year recommendations were resolved. However, CSB needs to
improve its management processes associated with configuration management,
patch management, and management of its information technology assets
inventory.
EPA OIG contracted with a firm to perform the FY 2011 Federal Information Security
Management Act assessment for CSB. That assessment noted several challenges CSB
faces in securing its main information technology system. The assessment found
unpatched network devices, which elevated CSB's risk of system and data compromise
by unauthorized users. The contract firm provided detailed results of its assessment to
CSB officials. The firm also identified 199 excess information technology devices, out of
a total of 408, which could allow for misuse or loss of information technology devices or
data.
The report recommended that CSB review and implement patches for network devices as
required, develop and implement standard baseline configurations for network devices,
and review the information technology inventory and remove the excess inventory
devices through appropriate means. CSB agreed with the recommendations and provided
agreed-upon corrective actions.
(Report No. 12-P-0363, Evaluation of U.S. Chemical Safety and Hazard Investigation
Board's Compliance With the Federal Information Security Management Act
(Fiscal Year 2011), March 21, 2012)
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Statistical Data
Profile of Activities and Results
Audit and evaluation operations
Office of Inspector General reviews
October 1, 2011 -
March 31, 2012
($ in millions)
Questioned costs *
Recommended efficiencies *
Costs disallowed to be recovered
Costs disallowed as cost efficiency
Reports issued by DIG
Reports resolved
(Agreement by Agency officials
to take satisfactory corrective actions) **
$11.6
$372.4
$0.0
$372.0
34
376
Audit and evaluation operations
Reviews performed by Single Audit Act auditors
Questioned costs *
Recommended efficiencies *
Costs disallowed to be recovered
Costs disallowed as cost efficiency
Single Audit Act reviews
Agency recoveries
Recoveries from audit resolutions
of current and prior periods
(cash collections or offsets to
future payments) ***
October 1, 2011-
March 31, 2012
($ in millions)
$2.9
$0.0
$1.51
$0.0
342
$2.6
Investigative Operations
Total Fines and Recoveries ****
Cost Savings
Cases Opened During Period
Cases Closed During Period
Indictments/Informations of
Persons or Firms
Convictions of Persons or Firms
Civil Judgments/Settlements/Filings
October 1, 2011-
March 31, 2012
($ in millions)
$3.7
$0.0
74
37
18
7
$0.2
Questioned costs and recommended efficiencies are
subject to change pending further review in the audit
resolution process.
Reports resolved are subject to change pending
further review.
Information on recoveries from audit resolutions is
provided by EPA's Office of Financial Management
and is unaudited.
Fines and recoveries resulting from joint
investigations.
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Audit, Inspection, and Evaluation Report Resolution
Status report on perpetual inventory of reports in resolution process
for semiannual period ending March 31, 2012
Report category
A. For which no management
decision was made by
October 1, 2011*
B. Which were issued during the
reporting period
C. Which were issued during the
reporting period that required
no resolution
Subtotals (A + B - C)
D. For which a management
decision was made during the
reporting period
E. For which no management
decision was made by
March 31, 201 2
F. Reports for which no
management decision was
made within 6 months of
issuance
No. of
reports
125
366
280
211
372
120
66
Report issuance
($ in thousands)
Questioned
costs
$13,411
14,599
0
28,010
5,313
24,426
1,067
Recommended
efficiencies
$0
372,000
0
372,000
372,000
0
0
Report resolution costs
sustained
($ in thousands)
To be
recovered
$1,510
117,961
0
119,471
119,471
0
0
As
efficiencies
$0
372,000
0
372,000
372,000
0
0
Any difference in number of reports and amounts of questioned costs or recommended efficiencies between this
report and our previous semiannual report results from corrections made to data in our audit tracking system.
Status of management decisions on OIG reports
This section presents additional statistical information that is required by the Inspector General Act of
1978, as amended, on the status of EPA management decisions on reports issued by the OIG involving
monetary recommendations. Tables 1 and 2 cannot be used to assess results of reviews performed or
controlled by the OIG. Many of the reports were prepared by other federal auditors or independent public
accountants. EPA OIG staff do not manage or control such assignments. Auditees frequently provide
additional documentation to support the allowability of such costs subsequent to report issuance.
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Table 1: Inspector general-issued reports with questioned costs for semiannual period ending
March 31, 2012 ($ in thousands)
Report category
A. For which no management decision was made by
October 1 , 201 1 **
B. New reports issued during period
Subtotals (A + B)
C. For which a management decision was made during the
reporting period:
(i) Dollar value of disallowed costs
(ii) Dollar value of costs not disallowed
D. For which no management decision was made by
March 31, 201 2
Reports for which no management decision was made
within 6 months of issuance
No. of
reports
26
14
40
15
15
0
23
12
Questioned
costs *
$13,411
14,599
28,010
5,313
1,627
3,686
24,426
1,067
Unsupported
costs
$12,334
12,619
24,953
3,412
1,510
1,902
21,449
1,067
Questioned costs include unsupported costs.
Any difference in number of reports and amounts of questioned costs between this report and our previous
semiannual report results from corrections made to data in our audit, inspection, and evaluation tracking system.
Table 2: Inspector general-issued reports with recommendations that funds be put to better use
for semiannual period ending March 31, 2012 ($ in thousands)
Report Category
A. For which no management decision was made by October 1, 2011 *
B. Which were issued during the reporting period
Subtotals (A + B)
C. For which a management decision was made during the reporting period:
(i) Dollar value of recommendations from reports that were
agreed to by management
(ii) Dollar value of recommendations from reports that were
not agreed to by management
(iii) Dollar value of nonawards or unsuccessful bidders
D. For which no management decision was made by March 31 , 201 1
Reports for which no management decision was made
within 6 months of issuance
No. of
reports
0
1
1
0
0
0
0
1
0
Dollar
value
$0
372,000
372,000
0
0
0
0
372,000
0
Any difference in number of reports and amounts of funds put to better use between this report and our previous
semiannual report results from corrections made to data in our audit, inspection, and evaluation tracking system.
Audits, inspections, and evaluations with no final action as of March 31, 2012, over 365 days past
the date of the accepted management decision (including audits, inspections, and evaluations in appeal)
Audits, inspections, and evaluations
Program
Assistance agreements
Contract audits
Single audits
Financial statement audits
Total
Total
31
13
0
19
2
65
Percentage
48
20
0
29
3
100
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Hotline Activity
The following table shows EPA OIG hotline activity regarding complaints of fraud, waste, and abuse in
EPA programs and operations during the semiannual reporting period ending March 31, 2012.
Semiannual Period
(October 1,2011 -
March 31, 2012)
Issues open at the beginning of the period
Inquiries received during the period
Inquiries closed during the period
Inquiries pending at the end of the period
118
111
129
100
Issues referred to others
OIG offices
EPA program offices
Other federal agencies
State/local agencies/other
68
35
1
7
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Summary of Investigative Results
Summary of investigative activity during reporting period
Cases open as of October 1 , 201 1
Cases opened during period
Cases closed during period
Cases pending as of March 31, 2012
210
74
37
247
Results of prosecutive actions
Criminal charges (indictments/informations/complaints)
Criminal convictions
Total
18
7
Sentencings
Prison time
Home detention
Probation
Community service
Fines and restitution
Total
109 months
14 months
504 months
350 hours
$3,740,670
Civil actions
Civil orders
Civil seizure
Total
2
$206,917
Administrative actions
Suspensions
Debarments
Other administrative actions
Total
Total
17
8
9
34
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Scoreboard of Results
All results reported in FY 2012, from current and prior year's work, are as reported in OIG Performance Measurement
and Results System, Inspector General Operations Reporting System, and Inspector General Enterprise
Management System. These results are unaudited.
OIG FY 2012 Government Performance and
Results Act annual performance targets
compared to first half FY 2012 results
Supporting measures
Goal: Contribute to human health and environmental quality through improved business practices,
accountability, and integrity of program operations
Environmental improvements/actions/
changes/improvements in business/systems/
efficiency risks reduced or eliminated
Target: 334
Reported: 141 (42.22%)
5 Legislative/regulatory changes/decisions
41 Environmental or management policy, process,
practice, control change actions
0 Environmental/health improvements
30 Environmental/business risks/challenges eliminated
22 Certifications/validations/verifications/corrections
23 Actions taken or resolved prior to report issuance
(not otherwise reported)
20 Recommendations reported as implemented
previously identified unimplemented by OIG follow-up*
Environmental & business recommendations,
challenges, best practices, risks identified,
Recovery Act technical briefings
Target: 903
Reported: 1,109 (122.8%)
[316 net Single Audits (35%)]
276 Recommendations (for Agency/stakeholder action)
15 Critical congressional or public management concerns
addressed
6 Best practices identified
5 Referrals for Agency action
5 New environmental or management operational risks
or challenges identified
8 Unimplemented recommendations identified
793 Findings without controlled recommendations **
1 Awareness briefings/outreach sessions
Return on investment: Potential dollar return as
percentage (120%) of OIG budget $51.9 million
Target: $57.1 million
Reported: $442.4 million (852.3%)
($ in millions)
$14.6 Questioned costs (net EPA)
$372.0 Recommended efficiencies, costs saved (EPA)*
$3.9 Fines, recoveries, settlements
$51.8 Monetary actions taken/resolved prior to report
issuance
Criminal, civil, and administrative actions
reducing risk of loss/operational integrity
Target: 85
Reported: 63 (74.12%)
7 Criminal convictions
18 Indictments/informations/complaints
34 Administrative actions
2 Civil actions
2 Allegations disproved
Other (no targets established)
Sustained monetary recommendations and
savings achieved from current and prior
periods: $38.4 million
Sustained environmental and management
recommendations for resolution action
Total reports issued: 376
($ in millions)
$1.5 Questioned costs sustained
$36.9 Cost efficiencies sustained or realized
184 Sustained recommendations
34 OIG-produced reports
342 Reports by other audit entities with OIG oversight
Includes $3.95 million in savings from investigations
From Single Audits not produced by EPA OIG or for EPA action
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Appendices
The Inspector General Act, as amended, requires a listing, subdivided according to subject matter, of each report issued by
the OIG during the reporting period. For each report, where applicable, the Inspector General Act also requires a listing of the
dollar value of questioned costs and the dollar value of recommendations that funds be put to better use. This listing includes a
section for reports involving the American Recovery and Reinvestment Act of 2009.
Questioned costs
Report no.
Report title
Date
Ineligible
costs
Unsupported Unreasonable
costs costs
Federal
recommended
efficiencies
PERFORMANCE REPORTS
12-P-0062 FY 2011 Federal Information Security Management Act Report Nov. 09, 2011
12-P-0071 Effective Defense Contract Audit Agency Audit Report Resolution by EPA Nov. 10, 2011
12-P-0083 Mountain Top Mining Congressional Request Nov. 21,2011
12-P-0102 Drinking Water State Revolving Funds Helping Communities Meet Standards Dec. 01, 2011
12-P-0113 EPA Must Improve Oversight of State Enforcement Dec. 09, 2011
12-P-0125 Use of Unapproved Asbestos Demolition Methods May Threaten Public Health Dec. 14, 2011
12-P-0160 Training Contractor Not Promptly Paid Under Purchase Order EP07H001074 Dec. 28, 2011
12-P-0162 EPA Needs to Manage Nanomaterial Risks More Effectively Dec. 29, 2011
12-P-0220 Region 10 Technical and Computer Room Security Vulnerabilities Jan. 20, 2012
12-P-0231 EPA Policy on Financing Local Reserves Needs Revision Jan. 25, 2012
12-P-0249 Clean Water Act Section 404 Permit Notification Reviews, Surface Coal Mining Feb. 02, 2012
12-P-0251 Capping Report: Superfund Five-Year Reviews Feb. 06, 2012
12-P-0253 EPA Needs to Further Improve Managing Oil Pollution Prevention Program Feb. 06, 2012
12-P-0289 State Underground Storage Tank Inspection Programs in EPA Regions Feb. 15, 2012
12-P-0311 EPA Can Improve Its Improper Payments Reporting Mar. 01,2012
12-P-0320 Cost-Reimbursement Contracts Based on Duncan Hunter Act Mar. 06, 2012
12-P-0328 Improvement Required to Safeguard Enforcement and Inspection Credentials Mar. 09, 2012
12-P-0360 Superfund Contracting Congressional FY 2012 Mar. 16, 2012
12-P-0362 Corrective Actions at Asheville, North Carolina Superfund Site Mar. 21, 2012
12-P-0376 Early Warning Report Clean Air Act Risk Management Program Inspections Mar. 28, 2012
TOTAL PERFORMANCE REPORTS = 20
SINGLE AUDIT REPORTS
12-3-0001 DadeCity, Florida, City of-FY 2010 Oct. 05, 2011
12-3-0002 Graceville, Florida, City of-FY 2010 Oct. 05, 2011
12-3-0003 Pell, Alabama, City of-FY 2010 Oct. 05, 2011
12-3-0004 Smith Utility District of Smith County, Tennessee - FY 2010 Oct. 05, 2011
12-3-0005 Tioga Soil and Water Conservation District-FY 2010 Oct. 11,2011
12-3-0006 Huntingdon, Pennsylvania, Borough of - FY 2010 Oct. 11,2011
12-3-0007 Cascade Sierra Solutions, Oregon-FY 2010 Oct. 11,2011
12-3-0009 Nekoosa, Wisconsin, City of - FY 2010 Oct. 13, 2011
12-3-0010 Oregon, Illinois, City of-FY 2011 Oct. 13, 2011
12-3-0011 SRC, Inc.-FY2010 Oct. 13, 2011
12-3-0012 Puerto Rico, University of-FY 2010 Oct. 14,2011
12-3-0014 Grand Portage Reservation Tribal Council, Minnesota-FY 2010 Oct. 17,2011
12-3-0015 Hualapai Nation, Arizona-FY 2009 Oct. 17, 2011
12-3-0016 Stockbridge, Georgia, City of-FY 2010 Oct. 20, 2011
12-3-0017 Southwest Allen Parish Water District No. 2, Louisiana - FY2010 Oct. 20, 2011
12-3-0018 Harrisonville, Missouri, City of-FY 2010 Oct. 20, 2011
12-3-0019 Lenexa, Kansas, City of-FY 2010 Oct. 20, 2011
12-3-0020 Rathbun Regional Water Association, Inc., Iowa-FY 2010 Oct. 20, 2011
12-3-0021 Johnsonburg Municipal Authority, Pennsylvania - FY 2010 Oct. 21, 2011
12-3-0022 Mississippi Institutions of Higher Learning, Mississippi Oct. 21, 2011
12-3-0023 Missouri System, Missouri, University of-FY 2010 Oct. 21, 2011
12-3-0024 Lawton, Oklahoma, City of-FY 2010 Oct. 21,2011
12-3-0025 Junction City, Kansas, City of- FY 2010 Oct. 21,2011
12-3-0026 National Tribal Environmental Council, Inc., New Mexico - FY 2006 Oct. 21, 2011
12-3-0027 Clarkesville, Georgia, City of-FY 2010 Oct. 21,2011
12-3-0028 Illinois Institute of Technology-FY 2010 Oct. 28, 2011
12-3-0029 Leoni, Michigan, Township of-FY 2010 Oct. 28, 2011
12-3-0030 Port Clinton, Ohio, City of-FY 2010 Oct. 27, 2011
12-3-0031 Boston Public Health Commission, Massachusetts Oct. 28, 2011
12-3-0032 Rochester Borough Sewer Authority, Pennsylvania - FY 2010 Oct. 28, 2011
12-3-0033 Liberty, Missouri, City of-FY 2010 Oct. 28, 2011
12-3-0035 Auburn Board of Public Works, Nebraska-FY 2010 Oct. 31,2011
12-3-0036 Berrien, Michigan, County of-FY 2010 Oct. 31,2011
12-3-0037 Blue Earth, Minnesota, City of-FY 2010 Oct. 31,2011
12-3-0038 Deerfield, Wisconsin, Village of-FY 2010 Oct. 31,2011
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$0
0
0
0
0
0
2,064,472
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$0
0
0
0
372,000,000
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$372,000,000
45
-------
Semiannual Report to Congress
October 1, 2011—March 31, 2012
Questioned costs Federal
Report no.
12-3-0039
12-3-0040
12-3-0041
12-3-0042
12-3-0043
12-3-0044
12-3-0045
12-3-0046
12-3-0047
12-3-0048
12-3-0049
12-3-0050
12-3-0051
12-3-0052
12-3-0053
12-3-0054
12-3-0055
12-3-0056
12-3-0057
12-3-0058
12-3-0059
12-3-0060
12-3-0061
12-3-0063
12-3-0064
12-3-0065
12-3-0066
12-3-0067
12-3-0068
12-3-0069
12-3-0070
12-3-0074
12-3-0075
12-3-0076
12-3-0077
12-3-0078
12-3-0079
12-3-0080
12-3-0081
12-3-0082
12-3-0084
12-3-0085
12-3-0086
12-3-0087
12-3-0088
12-3-0089
12-3-0091
12-3-0092
12-3-0093
12-3-0094
12-3-0095
12-3-0096
12-3-0097
12-3-0098
12-3-0099
12-3-0100
12-3-0101
12-3-0103
12-3-0104
12-3-0105
12-3-0106
12-3-0107
12-3-0108
12-3-0110
12-3-0111
12-3-0112
12-3-0114
12-3-0115
12-3-0116
12-3-0117
12-3-0118
12-3-0119
12-3-0120
12-3-0121
12-3-0122
12-3-0123
Report title
Minnesota Environmental Initiative, Inc. - FY 2010
Elk Point, South Dakota, City of - FY 2010
Cahuilla Band of Indians, California - FY 2009
Corrales, New Mexico, Village of - FY 2010
Lakeville, Massachusetts, Town of - FY2010
Bristol, New Hampshire, Town of - FY 2010
Putnam Public Service District— Water Fund, West Virginia - FY 2010
Pueblo, Colorado, County of - FY 2010
Seibert, Colorado, Town of - FY 2010
Chamberlain, South Dakota, Municipality of - FY 2010
Rapid Valley Sanitary District, South Dakota - FY 2010
Hi-Land Acres Water and Sanitation District, Colorado - FY 2010
East Lyme, Connecticut, Town of - FY 201 0
Zephyrhills, Florida, City of - FY 2010
Haines, Florida, City of- FY 2009
Olympia, Washington, City of - FY 2010
South Fork Band Council, Nevada - FY 2008
Indian Township, Maine, Tribal Government - FY 2010
Moundville, Alabama, Town of - FY 2010
Decatur, Mississippi, Town of - FY 201 0
Ohio State University -FY 2010
Peterborough, New Hampshire, Town of - FY 2010
Pennsylvania, Commonwealth of- FY2010
Charleston, Arkansas, City of - FY 2010
Chemung County Library District, New York - FY 2010
Evergreen Rural Water Association of Washington - FY 2010
Galeton Borough Authority - FY 2010
Galveston, Texas, City of - FY 2010
Jefferson, Georgia, City of - FY 2010
Loudoun County Sanitation District, Virginia - FY2010
Meadville Area Water Authority, Pennsylvania - FY 2010
Sistemo Universitario Ana G Mendez, Puerto Rico - FY 2010
Sparks, Nevada, City of -FY 2010
Sundance, Wyoming, City of - FY 2010
Vale, Oregon, City of - FY 2010
Fort Independence Indian Reservation, California - FY2010
Kalispel Tribe of Indians, Washington - FY 2010
Tangirnaq Native Village, Alaska - FY 2010
Nanwalek IRA Council, Alaska - FY 2009
Sun'Aq Tribe of Kodiak, Alaska - FY 2010
Whitehall, Wisconsin, City of - FY 2010
Hudson, New York, City of - FY 2010
Laurel, Montana, City of - FY 2009
Red Lodge, Montana, City of - FY 2010
Upper-Lower River Road Co. Water & Sewer District, Montana - FY 2009
Willmar, Minnesota, City of -FY 2010
Grand Rapids Public Utilities Corporation, Minnesota - FY2010
Gary, Indiana, City of- FY 2009
Pocahontas, Iowa, County of - FY 2010
Pueblo, Colorado, City of- FY 20 10
Barnstable, Massachusetts, City of - FY 2010
Houston Authority of Harris County, Texas, Port of - FY 2010
Palatka, Florida, City of - FY 2010
Sleepy Eye, Minnesota, City of - FY 201 0
Consortium for Plant Biotechnology Research, Inc., Georgia - FY 2010
Miami-Dade County, Florida - FY 2010
Upper Sioux Community Federal and State Program Dept, Minnesota - FY 2010
Redwood Falls, Minnesota, City of - FY 201 0
Albuquerque, New Mexico, City of - FY 2010
Fontana-on-Geneva Lake, Wisconsin, Village of - FY 2010
Nevada Irrigation District, California - FY 2010
Owner-Operator Drivers Association Foundation, Inc., Missouri - FY 2010
Onondaga County Soil and Water Conservation District, New York - FY 2010
Turtle Mountain Band of Chippewa Indians, North Dakota - FY 2010
Washburn, North Dakota, City of - FY 2010
Tanana Native Village, Alaska - FY 2010
Akiak Native Community, Alaska - FY2010
Nooksack Indian Tribe, Washington - FY2010
Sherwood, Wisconsin, Village of- FY 2010
Chubbuck, Idaho, City of - FY 2010
Butternut, Wisconsin, Village of - FY 2010
Arcadia, Louisiana, Town of- FY2010
Melba, Idaho, City of -FY 2010
Presidio, Texas, City of- FY 2010
Kimberly, Idaho, City of- FY 2010
Bliss, Idaho, City of- FY 2010
Ineligible Unsupported Unreasonable recommended
Date costs costs costs efficiencies
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Oct. 31,2011
Nov. 01,2011
Nov. 01,2011
Nov. 01,2011
Nov. 01,2011
Nov. 01,2011
Nov. 07, 2011
Nov. 07, 2011
Nov. 07, 2011
Nov. 07, 2011
Nov. 07, 2011
Nov. 08, 2011
Nov. 09, 2011
Nov. 09, 2011
Nov. 09, 201 1
Nov. 09, 2011
Nov. 09, 2011
Nov. 09, 2011
Nov. 09, 2011
Nov. 09, 2011
Nov. 16, 2011
Nov. 16, 2011
Nov. 16, 2011
Nov. 17, 2011
Nov. 17, 2011
Nov. 17, 2011
Nov. 17, 2011
Nov. 18, 2011
Nov. 18, 2011
Nov. 21,2011
Nov. 21,2011
Nov. 21,2011
Nov. 21,2011
Nov. 21,2011
Nov. 21,2011
Nov. 22, 2011
Nov. 22, 2011
Nov. 22, 2011
Nov. 22, 2011
Nov. 22, 2011
Nov. 29, 2011
Nov. 29, 2011
Nov. 29, 2011
Nov. 29, 2011
Nov. 29, 2011
Nov. 29, 2011
Dec. 06, 2011
Dec. 06, 2011
Dec. 06, 2011
Dec. 07, 2011
Dec. 07, 2011
Dec. 07, 2011
Dec. 08, 2011
Dec. 08, 2011
Dec. 08, 2011
Dec. 09, 2011
Dec. 09, 2011
Dec. 09, 2011
Dec. 09, 2011
Dec. 09, 2011
Dec. 09, 2011
Dec. 09, 2011
Dec. 09, 2011
Dec. 12, 2011
Dec. 13, 2011
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
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0
0
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0 0
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0 0
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0 0
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0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
9,767 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
44,924 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
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0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
46
-------
Semiannual Report to Congress
October 1, 2011—March 31, 2012
Questioned costs Federal
Report no.
12-3-0124
12-3-0126
12-3-0127
12-3-0128
12-3-0129
12-3-0130
12-3-0131
12-3-0132
12-3-0133
12-3-0134
12-3-0135
12-3-0136
12-3-0137
12-3-0138
12-3-0139
12-3-0140
12-3-0141
12-3-0142
12-3-0143
12-3-0144
12-3-0145
12-3-0146
12-3-0147
12-3-0148
12-3-0149
12-3-0150
12-3-0151
12-3-0152
12-3-0153
12-3-0154
12-3-0155
12-3-0156
12-3-0157
12-3-0158
12-3-0159
12-3-0163
12-3-0164
12-3-0165
12-3-0166
12-3-0167
12-3-0168
12-3-0169
12-3-0170
12-3-0171
12-3-0172
12-3-0173
12-3-0174
12-3-0175
12-3-0176
12-3-0177
12-3-0178
12-3-0179
12-3-0180
12-3-0181
12-3-0182
12-3-0183
12-3-0184
12-3-0185
12-3-0186
12-3-0187
12-3-0188
12-3-0189
12-3-0190
12-3-0191
12-3-0192
12-3-0193
12-3-0194
12-3-0195
12-3-0196
12-3-0197
12-3-0198
12-3-0199
12-3-0200
12-3-0201
12-3-0202
12-3-0203
Report title
Anchorage, Alaska, Municipality of - FY 2010
Kuskokwim Native Association, Alaska - FY 2009
Ruidoso, New Mexico, Village of - FY 201 0
Dousman, Wisconsin, Village of - FY 2010
Fontana Walworth Pollution Control Commission, Wisconsin - FY 2010
Neenah, Wisconsin, City of - FY 2010
Stevens Point, Wisconsin, City of - FY 2010
Elkins, West Virginia, City of - FY 2010
Dorchester County Sanitation District, Maryland - FY 201 1
Rockford, Illinois, City of - FY 2010
Villa Park, Illinois, Village of- FY 2011
Alexandria, Louisiana, City of - FY 201 1
Munich, North Dakota, City of - FY 2010
Harrisburg, South Dakota, Municipality of - FY 2010
Bayfield, Colorado, Town of - FY 2010
Inkster, Minnesota, City of - FY 2009
Glenview, Illinois, Village of- FY 2010
Barry, Michigan, County of- FY2010
St. Paul, Nebraska, City of - FY 2009
East Berlin Area Joint Authority, Pennsylvania - FY2010
Allegheny, Pennsylvania, County of - FY 2010
Orbisonia-Rockhill Joint Municipal Authority, Pennsylvania - FY 2009
Clark County, Indiana -FY 2010
Darlington, Indiana, Town of - FY 2009
Oak Creek, Wisconsin, City of - FY 2010
Centertown, Kentucky, City of - FY 2010
Burkesville, Kentucky, City of - FY 2010
Falmouth, Kentucky, City of - FY 2009
Moss Point, Mississippi, City of - FY 2009
Carolina Beach, North Carolina, Town of - FY 2010
Orange Water and Sewer Authority, North Carolina - FY 2009
Maynardville, Tennessee, City of- FY 2010
Calhoun Falls, South Carolina, Town of - FY 2010
Bartlesville, Oklahoma, City of - FY 2010
Bonham, Texas, City of - FY 2009
Monson Utilities District, Maine - FY 2010
Canaan Fire District #2, Vermont
Milwaukee Metropolitan Sewerage District, Wisconsin - FY2010
Hammond, Indiana, City of - FY 2010
Mecosta County, Michigan - FY 2010
Te-Moak Tribe Western Shoshone Battle Mountain Band, Nevada - FY 2010
Yomba Shoshone Tribe, Nevada - FY 2009
Medford, New Jersey, Township of - FY 2010
Britton-Macon Area School, Michigan - FY 201 1
New Baden, Illinois, Village of - FY 201 1
Slatington Borough Authority, Pennsylvania - FY2011
Hickory, North Carolina, City of - FY 2009
Aberdeen, Maryland, City of - FY 201 1
Delhi, Louisiana, Town of - FY 2010
Canaan Fire District #2, Vermont - FY 2010
Monson Utilities District, Maine -FY 2010
Saugerties, New York, Town of - FY 2010
Bellmawr, New Jersey, Borough of - FY 2010
Urania, Louisiana, Town of - FY 2010
Westlake, Louisiana, City of - FY 2010
Windsor, Vermont, Town of - FY 2010
National Environmental Education Foundation, DC- FY2010
Alliance for the Chesapeake Bay, Inc., Maryland - FY 2010
Watauga River Regional Water Authority, Carter County, Tennessee - FY 2010
Boones Mill, Virginia, Town of - FY 2010
Municipal Authority of the Township of Washington, Pennsylvania - FY 2010
Hedrick, Iowa, City of - FY 20 10
Spencer, Iowa, City of - FY 2010
Albany, Georgia, City of - FY 2010
St. Charles, Iowa, City of - FY 2010
Chautauqua County Rural Water District No. 4, Kansas
Hualapai Nation, Arizona - FY 2010
Sergeant Bluff, Iowa, City of - FY 201 0
O'ahu Resource Conservation & Development Council, Hawaii - FY 2010
Ramona Band of Cahuilla, California - FY 2010
Onondaga Environmental Institute, New York - FY 2009
Rock Falls, Illinois, City of -FY 2011
Wiyot Tribe, California - FY2010
North American Association for Environmental Education, DC - FY 2010
Snoqualmie Indian Tribe, Washington - FY 2010
Berlin Water Works, New Hampshire - FY 2010
Date
Dec. 13, 2011
Dec. 16,2011
Dec. 16, 2011
Dec. 16, 2011
Dec. 16, 2011
Dec. 16, 2011
Dec. 16, 2011
Dec. 16, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 19, 2011
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 201 1
Dec. 20, 201 1
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 2011
Dec. 20, 2011
Jan. 04, 2012
Jan. 04, 2012
Jan. 05, 2012
Jan. 05, 2012
Jan. 06, 2012
Jan. 06, 2012
Jan. 06, 2012
Jan. 10, 2012
Jan. 10, 2012
Jan. 10, 2012
Jan. 10, 2012
Jan. 10, 2012
Jan. 10, 2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 11,2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Ineligible Unsupported Unreasonable recommended
costs costs costs efficiencies
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
150,000
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0 0
0 0
393,068 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
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0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
47
-------
Semiannual Report to Congress
October 1, 2011—March 31, 2012
Questioned costs Federal
Report no.
12-3-0204
12-3-0205
12-3-0206
12-3-0207
12-3-0208
12-3-0209
12-3-0210
12-3-0211
12-3-0212
12-3-0213
12-3-0214
12-3-0215
12-3-0216
12-3-0217
12-3-0218
12-3-0219
12-3-0221
12-3-0222
12-3-0223
12-3-0225
12-3-0226
12-3-0227
12-3-0228
12-3-0229
12-3-0230
12-3-0232
12-3-0233
12-3-0234
12-3-0235
12-3-0236
12-3-0237
12-3-0238
12-3-0239
12-3-0240
12-3-0241
12-3-0242
12-3-0243
12-3-0244
12-3-0245
12-3-0246
12-3-0247
12-3-0248
12-3-0250
12-3-0252
12-3-0254
12-3-0255
12-3-0256
12-3-0257
12-3-0258
12-3-0259
12-3-0260
12-3-0261
12-3-0262
12-3-0263
12-3-0264
12-3-0265
12-3-0266
12-3-0267
12-3-0268
12-3-0269
12-3-0270
12-3-0271
12-3-0272
12-3-0273
12-3-0274
12-3-0275
12-3-0276
12-3-0277
12-3-0278
12-3-0279
12-3-0280
12-3-0281
12-3-0282
12-3-0283
12-3-0285
12-3-0286
Report title
Villanova University, Pennsylvania - FY 2010
Wythe, Virginia, County of - FY 2010
Mineral, Nevada, County of- FY2010
Tesuque-Pueblo of New Mexico - FY 2010
Buchanan, Michigan, City of - FY 201 1
Dekalb Sanitary District, Illinois - FY 201 1
Grand Ledge, Michigan, City of - FY 201 1
Atka IRA Council, Alaska - FY 2010
Chambersburg, Pennsylvia, Borough of
Harris County Water Control and Improvement District No. 36, Texas - FY 201 1
Leeds Domestic Water Users Association, Utah - FY 2010
Broad Top Township, Pennsylvania - FY 2010
Chippewa Falls, Wisconsin, City of - FY 2009
Tonto Apache Tribe, Arizona - FY 2010
Columbus, Nebraska, City of - FY 2010
Ohio, State of, Interim Single Audit Review - FY 201 1
White Mountain Apache Tribe, Arizona - FY 2009
Fallon Paiute-Shoshone Tribe, Nevada - FY 201 1
Iliamna Village Council, Alaska - FY 2007
Branch, Michigan, County of - FY 2010
Baraboo, Wisconsin, City of -FY 2010
Bloomington, Illinois, City of- FY 2010
Bloomington, Indiana, City of - FY 2010
Calumet County, Wisconsin - FY 2010
Chicago, Illinois, City of- FY 2010
Atmautluak Traditional Council, Alaska - FY 2010
Atlantic States Rural Water and Wastewater Association, Maine - FY 2010
Blue Lake Rancheria, California - FY 2010
Clean Energy Coalition, Michigan - FY 2010
Vallejo, California, City of - FY 2010
Chippewa Falls, Wisconsin, City of - FY 2010
Chautauqua, New York, County of - FY 2010
Inter-Tribal Council of Arizona, Inc., Arizona - FY 2010
Trinidad Rancheria, California - FY2010
Thomaston, Georgia, City of - FY 2010
Sardis, Georgia, City of- FY 2010
Lake Champlain Basin Science Center, Inc., Vermont - FY2011
Cincinnati, University of, Ohio - FY 201 1
Kansas, University of, Center for Research, Inc. - FY2011
Bolivar County, Mississippi - FY2010
Torres Maritnez Desert Cahuilla Indians, California - FY 2010
Pickens County, Georgia - FY2010
Colorado Springs Utilities, Colorado - FY 2010
Yurok Tribe, California - FY 2010
Chesterfield, Indiana, Town of - FY 201 0
Alaska Rural Water Association, Alaska - FY 2010
Centerville, Indiana, Town of - FY2010
Plainfield, Indiana, Town of - FY2010
Pierce County, Wyoming - FY2010
Osage Municipal Utilities, Iowa - FY 2010
Iowa Regional Utilities Association, Iowa - FY 2010
South Holland, Illinois, Village of - FY 201 1
United States Virgin Islands - FY 2009
Will County, Illinois -FY 2010
Rend Lake Conservancy District, Illinois - FY 201 1
Winchester, City of -FY 2011
Sycamore, Illinois, City of - FY 201 1
Fort Bidwell Indian Community Council, California - FY 2010
Fort Mojave Indian Tribe, California - FY2010
Golden Beach, Florida, Town of - FY2010
Green River Valley Water District, Kentucky - FY 201 1
San Manuel Band of Mission Indians, California - FY 2010
Martinsville, Indiana, City of -FY 2010
An/in Community Services District, California - FY 2010
Alexandria, Indiana, City of - FY 2009
San Carlos Apache Tribe, Arizona - FY 2010
Ashland, Wisconsin, City of - FY 2010
Glencoe, Alabama, City of - FY 201 0
La Jolla Band of Luiseno Indians, California - FY 2010
Madera County, California - FY 2010
Fulton County, Illinois -FY 2010
Chadron, Nebraska, City of - FY 2010
Ohio County Regional Wastewater District, Inc., Kentucky - FY 2009
Manitou Springs, Colorado, City of - FY 201 0
Commonwealth Utilities Corporation MP - FY 2010
Canton, Illinois, City of- FY 2010
Date
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 12, 2012
Jan. 13, 2012
Jan. 13, 2012
Jan. 20, 2012
Jan. 20, 2012
Jan. 23, 2012
Jan. 24, 2012
Jan. 24, 2012
Jan. 24, 2012
Jan. 24, 2012
Jan. 24, 2012
Jan. 24, 2012
Jan. 26, 2012
Jan. 27, 2012
Jan. 27, 2012
Jan. 30, 2012
Jan. 30, 2012
Jan. 30, 2012
Jan. 30, 2012
Jan. 30, 2012
Jan. 31,2012
Jan. 31,2012
Jan. 31, 2012
Jan. 31,2012
Jan. 31, 2012
Jan. 31,2012
Jan. 31, 2012
Jan. 31, 2012
Jan. 31, 2012
Jan. 31,2012
Feb. 06, 2012
Feb. 06, 2012
Feb. 07, 2012
Feb. 07, 2012
Feb. 07, 2012
Feb. 07, 2012
Feb. 07, 2012
Feb. 08, 2012
Feb. 08, 2012
Feb. 08, 2012
Feb. 08, 2012
Feb. 08, 2012
Feb. 08, 2012
Feb. 09, 2012
Feb. 09, 2012
Feb. 09, 2012
Feb. 09, 2012
Feb. 09, 2012
Feb. 09, 2012
Feb. 10,2012
Feb. 10,2012
Feb. 13,2012
Feb. 13, 2012
Feb. 13, 2012
Feb. 13,2012
Feb. 13,2012
Feb. 13,2012
Feb. 13,2012
Feb. 13, 2012
Feb. 14, 2012
Feb. 14, 2012
Feb. 15,2012
Feb. 15,2012
Ineligible Unsupported Unreasonable recommended
costs costs costs efficiencies
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
247,830
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
59,665
0
0
0
0
0
0
0
0
0
0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
4,714 0
0 0
0 0
0 0
0 0
0 0
0 0
5,235 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
48
-------
Semiannual Report to Congress
October 1, 2011—March 31, 2012
Questioned costs Federal
Report no.
12-3-0287
12-3-0288
12-3-0290
12-3-0291
12-3-0292
12-3-0293
12-3-0294
12-3-0296
12-3-0297
12-3-0298
12-3-0299
12-3-0300
12-3-0301
12-3-0302
12-3-0303
12-3-0304
12-3-0305
12-3-0307
12-3-0308
12-3-0309
12-3-0310
12-3-0313
12-3-0314
12-3-0315
12-3-0316
12-3-0317
12-3-0318
12-3-0319
12-3-0322
12-3-0323
12-3-0324
12-3-0325
12-3-0326
12-3-0327
12-3-0329
12-3-0330
12-3-0331
12-3-0332
12-3-0333
12-3-0334
12-3-0335
12-3-0336
12-3-0337
12-3-0338
12-3-0339
12-3-0340
12-3-0341
12-3-0342
12-3-0343
12-3-0344
12-3-0345
12-3-0346
12-3-0347
12-3-0348
12-3-0349
12-3-0350
12-3-0351
12-3-0352
12-3-0353
12-3-0354
12-3-0355
12-3-0356
12-3-0357
12-3-0358
12-3-0359
12-3-0361
12-3-0364
12-3-0365
12-3-0366
12-3-0367
12-3-0368
12-3-0369
12-3-0370
12-3-0371
12-3-0372
12-3-0373
Report title
Saint Elmo, Illinois, City of- FY 2011
Wellington, Kansas, City of - FY 2010
Byron, Georgia, City of - FY 201 0
Cold Springs Rancheria of the Mono Indians, California - FY 201 0
Milwaukee Community Services Corp., Inc., Wisconsin - FY2010
Mooresville, Indiana, Town of - FY2010
Normal, Illinois, Town- FY 2011
Beaver Dam, Wisconsin, City of - FY 201 0
Lomira, Wisconsin, Village of - FY 2010
Crow Wing County, Minnesota - FY2010
Detroit Lakes, Minnesota, City of - FY 201 0
Rushford, Minnesota, City of - FY 2010
Saint Peter, Minnesota, City of - FY 2010
St. Cloud, Minnesota, City of - FY 2010
Wilmont, Minnesota, City of - FY 2010
Bedford Township Municipal Authority, Pennsylvania - FY 201 1
Hinckely, Illinois, Village of - FY 2011
Dawson Springs Municipal Waterworks and Sewer System, Kentucky - FY 201 1
Livingston County, Illinois - FY 2010
Logan County, Illinois- FY 20 10
New Market, Virginia, Town of - FY 201 1
Olney, Illinois, City of- FY 2011
Madison County Industrial Development & Building Authority, Georgia - FY 2010
Lake Lure, North Carolina, Town of - FY 201 1
Farmville, North Carolina, Town of - FY2011
Forest County, Wisconsin - FY 2010
Green Bay Metropolitan Sewerage District, Wisconsin - FY2010
Iron County, Wisconsin - FY 2010
Great Bend, Kansas, City of FY 2010
Assiniboine and Sioux Tribe of the Fort Peck Indian Reservation, Montana
Greenport New York Incorporated, Village of - FY 2010
Lowell, Massachusetts, City of - FY 201 1
Maine Rural Water Association - FY 201 0
New England, University of Maine - FY 201 1
Greater St. Albans Public District, West Virginia - FY 2010
California, Missouri, City of - FY 201 1
Greenville Sanitary District #1, Wisconsin - FY2010
Liberty, Missouri, City of - FY 2010
Menasha, Wisconsin, Town of- FY2010
Stetsonville, Wisconsin, Village of - FY 2010
Turtle Lake, Wisconsin, Village of - FY 2010
Walworth, Wisconsin, Village of - FY 2010
Peru, Illinois, City of- FY 2011
Pontiac, Michigan, City of - FY 2011
SaultSte. Marie, Michigan, City of -FY 2011
Taylor County, Wisconsin - FY2010
Tazewell County, Illinois - FY 2010
Valley City, North Dakota, City of - FY 2010
Waupaca County, Wisconsin - FY 2010
Woodford County, Illinois- FY 2010
Alpine, Wyoming, Town of- FY2011
Linn, Missouri, City of - FY 2011
Milwaukee Metropolitan Sewerage District, Wisconsin - FY 2010
West Baraboo, Wisconsin, Village of - FY 2010
Paris, Missouri, City of- FY 2011
Withee, Wisconsin, Village of - FY 2010
Lake Holcombe Sanitary District No. 1, Wisconsin - FY 2010
Langlade County, Wisconsin - FY 2010
Louisa, Kentucky, City of - FY 2010
Nevada, Missouri, City of- FY 2010
Jasper County, Missouri - FY 2010
Clinton Community Schools, Michigan - FY 2011
Nickerson, Kansas, City of - FY 2010
Johnstown, New York, City of - FY 2009
Apache Tribe of Oklahoma, Oklahoma - FY 2010
Manitowoc County, Wisconsin - FY2010
Cedar Bluffs, Nebraska, Village of - FY 201 1
El Dorado, Kansas, City of - FY 2010
Gamer, Iowa, City of- FY 2011
Nibbing, Minnesota, City of - FY 2010
Nibbing Public Utilities Commission, Minnesota - FY 2010
Howard Lake, Minnesota, City of - FY 201 0
Kemmerer-Diamondville Water/Wastewater Joint Powers, Wyoming - FY 201 1
Laurel, Montana, City of - FY 2010
Dalles, Oregon, City of- FY 2011
Mandan, North Dakota, City of - FY 2010
Ineligible Unsupported Unreasonable recommended
Date costs costs costs efficiencies
Feb. 15,2012
Feb. 15,2012
Feb. 16,2012
Feb. 23, 2012
Feb. 23, 2012
Feb. 24, 2012
Feb. 24, 2012
Feb. 27, 2012
Feb. 27, 2012
Feb. 28, 2012
Feb. 28, 2012
Feb. 28, 2012
Feb. 28, 2012
Feb. 28, 2012
Feb. 28, 2012
Feb. 29, 2012
Feb. 29, 2012
Feb. 29, 2012
Feb. 29, 2012
Feb. 29, 2012
Feb. 29, 2012
Mar. 01,2012
Mar. 01,2012
Mar. 05, 2012
Mar. 05, 2012
Mar. 05, 2012
Mar. 05, 2012
Mar. 05, 2012
Mar. 08, 2012
Mar. 08, 2012
Mar. 08, 2012
Mar. 08, 2012
Mar. 08, 2012
Mar. 08, 2012
Mar. 09, 2012
Mar. 09, 2012
Mar. 09, 2012
Mar. 09, 2012
Mar. 12,2012
Mar. 12, 2012
Mar. 12,2012
Mar. 12,2012
Mar. 13, 2012
Mar. 13,2012
Mar. 13,2012
Mar. 13,2012
Mar. 13,2012
Mar. 13,2012
Mar. 13,2012
Mar. 13,2012
Mar. 13,2012
Mar. 13,2012
Mar. 14,2012
Mar. 14,2012
Mar. 14,2012
Mar. 14, 2012
Mar. 14,2012
Mar. 14, 2012
Mar. 14, 2012
Mar. 14,2012
Mar. 14,2012
Mar. 14,2012
Mar. 15, 2012
Mar. 15, 2012
Mar. 15,2012
Mar. 19,2012
Mar. 21,2012
Mar. 21,2012
Mar. 21,2012
Mar. 21,2012
Mar. 21,2012
Mar. 21,2012
Mar. 21,2012
Mar. 21,2012
Mar. 22, 2012
Mar. 23, 2012
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
49
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Questioned costs
Report no.
Report title
Date
Ineligible
costs
Unsupported
costs
Unreasonable
costs
Federal
recommended
efficiencies
12-3-0374 Oconto Falls, Wisconsin, City of - FY 2010
12-3-0375 Reedsburg, Wisconsin, City of - FY 2010
TOTAL SINGLE AUDIT REPORTS = 342
Mar. 26, 2012
Mar. 26, 2012
0 0
0 0
$457,495 $2,522,180
0
0
$0
CONTRACT AND ASSISTANCE AGREEMENT REPORTS
12-4-0008 CERCLA Claim - Bofors Nobel Oct. 12,2011 $0 $0
12-2-0072 EPA Grants Awarded to Summit Lake Paiute Tribe, Sparks, Nevada Nov. 10,2011 0 96,615
12-4-0224 Cooperative Agreement X7-83325501 Awarded to Kathleen S. Hill Jan. 23, 2012 80,721 0
12-4-0284 H&S Environmental, Inc.'s Accounting System Feb. 14,2012 0 0
12-4-0295 Contract EP-S9-11-01 by SFS Chemical Safety, Inc., Emeryville, California Feb. 27, 2012 73,034 0
TOTAL CONTRACT AND ASSISTANCE AGREEMENT REPORTS = 5 $153,755 $96,615
AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 REPORTS
12-X-0090 Close-Out of Complaint, Metro. Water Reclamation District of Greater Chicago Nov. 22, 2011 $0 $0
12-R-0109 Site Visit of Elizabeth City Well Field Expansion Project, North Carolina Dec. 08, 2011 0 0
12-X-0161 Close-Out of Complaint, Wastewater Treatment Facility, Perkins, Oklahoma Dec.29,2011 0 0
12-R-0321 Site Visit of the Botanic Garden of Western Pennsylvania Mar. 08,2012 1,368,894 0
12-R-0377 Site Visit of Wastewater Treatment Plant, Village of Itasca, Illinois Mar. 30, 2012 0 10,000,000
TOTAL AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 $1,368,894 $10,000,000
REPORTS = 5
0
0
0
0
$0
0
0
0
0
$0
0
0
0
0
$0
0
0
0
0
$0
FINANCIAL STATEMENT REPORTS
12-1-0073 Audit of EPA's Fiscal 2011 and 2010 Consolidated Financial Statements
TOTAL FINANCIAL STATEMENT REPORTS = 1
Nov. 15, 2011
$0
$0
$0
U.S. CHEMICAL SAFETY AND HAZARD INVESTIGATION BOARD REPORTS
12-P-0312 CSB Improper Payment Recovery Audits
12-P-0363 CSB Compliance With Federal Information Security Management Act (FY 2011)
TOTAL U.S. CHEMICAL SAFETY AND HAZARD INVESTIGATION BOARD
REPORTS = 2
Mar. 01,2012
Mar. 21,2012
0
$0
0
$0
0
$0
OTHER REPORTS
12-N-0034 DIG Compendium of Unimplemented Recommendations as of 9/30/11
TOTAL OTHER REPORTS = 1
Oct. 31,2011
$0
$0
$0
$0
TOTAL REPORTS ISSUED = 376
$1,980,144 $12,618,795
$0 $372,000,000
50
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Appendix 2—Reports Issued Without Management Decisions
For Reporting Period Ended March 31, 2012
The Inspector General Act, as amended, requires a summary of each audit report issued before the commencement
of the reporting period for which no management decision had been made by the end of the reporting period, an
explanation of the reasons such management decision had not been made, and a statement concerning the desired
timetable for achieving a management decision on each such report. OMB Circular A-50 requires resolution within
6 months of a final report being issued. In this section, we report on audits with no management decision or resolution
within 6 months of final report issuance. In the summaries below, we note the Agency's explanation of the reasons a
management decision has not been made, the Agency's desired timetable for achieving a management decision, and
the OIG follow-up status as of March 31, 2012.
Office of the Administrator
Report No. 11-P-0722, EPA Should Prepare and Distribute Security Classification Guides, September 29, 2011
Summary: This report evaluated EPA's classified national security information infrastructure and its ability to
provide information to those who need it. OIG found that EPA has not established any official classification guides
even though EPA Administrators have taken original classification actions. EPA's National Security Information
Handbook requires that a classification guide be developed for each system, plan, program, or project that involves
classified information. The OIG recommended that the Administrator ensure the preparation, review, and approval
of appropriate security classification guides that conform to requirements. We also recommended that the
Administrator ensure the distribution of classification guides to users of EPA's originally classified information and
to program offices that work in related areas. The Office of Administration and Resources Management, which
responded for the Agency, did not agree with the report's conclusions, and the recommendations are unresolved.
Agency Explanation: The Administrator's office provided a follow-up response to the OIG on April 5, 2012. The OIG is
evaluating the response.
OIG Follow-Up Status: Incomplete response.
Office of Administration and Resources Management
Report No. 10-P-0112, Results of Hotline Complaint Review of EPA Region 9 Hiring under the Federal Career
Intern Program, April 26, 2010
Summary: The hotline allegations against EPA Region 9 were unsubstantiated. We identified that the region
engaged in a prohibited personnel practice. Neither the Office of Personnel Management nor EPA prohibits the use
of a job fair and registration code as recruiting and hiring methods. However, Region 9 engaged in a prohibited
personnel practice by giving four Federal Career Intern Program job fair participants improper advantages not
provided to others attending the job fair.
Agency Explanation: Office of Personnel Management is in the process of reviewing public comments submitted on
the proposed regulations for the Pathways Program. Until such time that the Office of Personnel Management has
published final implementing regulations for the Pathways Program, EPA cannot establish a corrective action plan,
if necessary, nor provide a projected completion date.
OIG Follow-Up Status: Incomplete response.
Report No. 10-P-0177, EPA's Revised Hiring Process Needs Additional Improvements, August 9, 2010
Summary: This report reviewed EPA's appointment process managed by its Office of Administration and Resources
Management to determine how the new process for filling vacancies can be more efficient and effective. The OIG
found that EPA had not implemented critical technology upgrades or obtained other resources necessary for the
service center concept to succeed. Also, service centers did not consistently provide program managers with the best
candidates, and data quality and recruitment action processes need improvement. OIG recommendations included
making changes to EPA Order 1110.8A5, EPA Reorganization Policy.
51
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Agency Explanation:. The OIG has accepted Office of Administration and Resources Management's Corrective
Action Plan with the exception of the recommendation on changing the EPA order. The Office of Administration and
Resources Management and the OIG continue to disagree on this recommendation; therefore, this audit has not
been closed. The Agency will continue to move forward on the remaining corrective actions
OIG Follow-Up Status: Proposed response received in review process.
Office of Air and Radiation
Report No. 04-P-00033, Effectiveness of Strategies to Reduce Ozone Precursors, September 29, 2004
Summary: Our analysis of EPA emissions data for "serious," "severe," and "extreme" ozone nonattainment areas
indicated that some major metropolitan areas may not have achieved the required 3 percent annual emission
reductions in ozone precursor emissions. While EPA air trend reports have emphasized that ozone levels are
declining nationally and regionally, only 5 of 25 nonattainment areas designated serious to extreme had substantial
downward trends. EPA provided an action plan to the OIG that provided a partial list of actions planned, and we
closed 8 of the 25 recommendations. We believed that we may have been able to close six recommendations once
the final Milestone Compliance Demonstration rule was promulgated. However, in May 2006, EPA told us it had
decided not to issue the rule; it instead planned to issue guidance that EPA regions could share with states. We did
not agree that guidance is an acceptable alternative. As of September 12, 2008, the Agency had not agreed with the
other recommendations and had not submitted a complete response that addresses all the recommendations in the
report. We will continue to follow up on the Agency's actions.
Agency Explanation: Office of Air Quality Planning and Standards will be meeting in mid April to discuss options for
developing a plan for Corrective Actions 3-1 and 3-3, and plans to meet with the OIG in late April to discuss plans for
moving forward.
OIG Follow-Up Status: Incomplete response.
Report No. 09-P-0151, EPA Does Not Provide Oversight of Radon Testing Accuracy and Reliability,
May 12, 2009
Summary: EPA does not perform oversight of radon testing device accuracy or reliability. The 1988 Indoor Radon
Abatement Act required that EPA establish proficiency programs for firms offering radon-related services, including
testing and mitigation. EPA established and operated proficiency programs until 1998, when it disinvested in these
programs. EPA asserts that it shares oversight responsibility with states and industry, including the two national
proficiency programs operating under private auspices. However, without oversight, EPA cannot assure that radon
testing devices provide accurate data on indoor radon risks or that radon testing laboratories accurately analyze and
report radon results. We recommended that EPA disclose that while radon testing is recommended, EPA cannot
provide assurance that commercially available radon testing devices or testing laboratories are accurate and reliable.
EPA generally agreed with this recommendation and stated that it will review and revise both its Web-based and
printed public materials, as appropriate. However, the Agency did not provide information on how it intends to
characterize the accuracy and reliability of radon testing in its public documents, and more information is needed.
Agency Explanation: Office of Air and Radiation sent a closeout memo to the OIG on February 13, 2012, and the OIG
has contacted Office of Radiation and Indoor Air program staff for follow-up questions. OIG and Office of Air and
Radiation staff met in March 2012 to discuss the Agency's response. Resolution is pending receipt of additional
information.
OIG Follow-Up Status: Incomplete response.
Report No. 11-P-0701, EPA Should Update Its Fees Rule to Recover More Motor Vehicle and Engine
Compliance Program Costs, September 23, 2011
Summary: OIG reviewed EPA's assessment and collection of vehicle emissions testing fees for its Motor Vehicle and
Engine Compliance Program. The OIG found that EPA is not recovering all reasonable costs of administering the
program. Our analysis, using the Agency's cost estimate for FY 2010, showed a $6.5 million difference between
estimated program costs of $24.9 million and fee collections of $18.4 million. EPA's final rule of May 2004 establishes
fees, but the rule does not allow fee increases to cover EPA's increasing costs. OIG recommended that the Assistant
Administrator for Air and Radiation update the 2004 fees rule to increase the amount of costs it can recover, and
conduct biennial reviews of the program's fee collections and the full cost of operating the program to determine
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Semiannual Report to Congress October 1, 2011—March 31, 2012
whether EPA is recovering its costs. EPA agreed with these recommendations but did not provide planned
completion dates. Therefore, we consider these recommendations unresolved with resolution efforts in progress.
Agency Explanation: On February 7, 2012, the Office of Air and Radiation submitted a request to the OIG that the
Office of the Chief Financial Officer rather than the Office of Air and Radiation conduct biennial user fees review. On
March 8, 2012, the OIG responded in agreement that the Office of the Chief Financial Officer will be responsible for
biennial review with consultation from Office of Air and Radiation technical staff. The OIG directed the Office of the
Chief Financial Officer to provide a corrective action plan with milestones by April 19, 2012.
OIG Follow-Up Status: Incomplete response.
Financial Analysis and Rate Negotiation Service Center
Report No. 06-4-00165, National Academy of Sciences—FY 2006 Indirect/Other Direct Costs System,
September 27, 2006
Summary: In DCAA's opinion, the contractor's service centers cost system and related internal control policies and
procedures were inadequate in part. DCAA's examination noted certain significant deficiencies in the design or
operation of the Indirect/Other Direct Costs system process.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
OIG Follow-Up Status: Resolution pending receipt of additional information.
Report No. 07-1-00061, Lockhead Martin Services Group—FY 12/31/2004 I/C, April 10, 2007
Summary: DCAA questioned $34,708,911 in claimed direct costs and proposed indirect costs. Further, DCAA did not
audit $338,864,655 in claimed direct and indirect costs for assist audits not yet received or for received assist audit
reports, the impact of which on the contractor's cost objectives has not yet been calculated. Additionally, DCAA
upwardly adjusted $48,224,805 in claimed base costs. EPA's share of the questioned costs totals $694,178. DCAA
did not provide any Cumulative Allowable Cost Work Sheet or Schedule of Allowable Costs by Cost Element by
Contract because the most current year with negotiated indirect rates is calendar year 1998. DCAA will issue a
supplemental audit report upon completion of its analysis of the assist audit results, and as the outstanding fiscal
years' indirect rates are negotiated, the requested Cumulative Allowable Cost Work Sheet and Schedule of Allowable
Costs by Cost Element by Contract will be provided.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
OIG Follow-Up Status: Resolution pending receipt of additional information.
Report No. 07-4-00058, Science Applications Intl. Corporation—Companies 1, 6, and 9—FY 2006 Floorchecks,
April 30, 2007
Summary: On September 25, 2006, DCAA determined that the floorchecks disclosed no significant deficiencies in the
contractor's timekeeping or labor system in FY 2005. On February 27, 2007, DCAA determined that certain labor
practices require corrective actions to improve the reliability of the contractor's labor accounting system. DCAA did
not express an opinion on the adequacy of the contractor's labor accounting system taken as a whole.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
OIG Follow-Up Status: Resolution pending receipt of additional information.
Report No. 07-1-00079, Science Applications Intl. Corporation—FYE 1/31/2005 I/C, July 18, 2007
Summary: DCAA submitted three audit reports under this assignment. DCAA accepted the claimed direct costs at
Companies 1 and 6 (there are no claimed direct costs at Company 9) and questioned proposed indirect costs and
rates at Companies 1, 6, and 9. DCAA questioned a total of $17,224,585 of Company 9's claimed indirect expenses
($9,938,874) and fringe benefit costs and rates ($7,285,711), of which $7,762,651 was allocated to other companies
that do not perform government work. Questioned indirect costs of $3,525,230 and $4,552,250 were allocated to and
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Semiannual Report to Congress October 1, 2011—March 31, 2012
questioned in the claimed general and administrative costs and rates of Companies 1 and 6, respectively. The
questioned fringe benefit rates in Company 9 resulted in questioned fringe benefit costs of $865,365 and $519,089
for Companies 1 and 6, respectively. DCAA questioned an additional $1,995,869 of Company 1 claimed indirect
expenses, and an additional $511,822 of Company 6 claimed indirect expenses. Total questioned costs in
Companies 1 and 6 are $11,969,625, of which $119,696 is applicable to EPA contracts.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
O/G Follow-Up Status: Resolution pending receipt of additional information.
Report No. 07-1-00080, Lockheed Martin Services, Inc.—FY 2005 Incurred Cost, August 6, 2007
Summary: DCAA questioned $595,792,539 in claimed direct costs and $10,982,460 in proposed indirect costs and
rates. None of the questioned direct costs are chargeable to any of the EPA contracts. A number of the EPA
contracts have indirect ceiling rates that are lower than the contractor's proposed indirect rates, and are not impacted
by the questioned indirect expenses and rates. However, there are EPA contract/subcontracts that do not have
indirect ceiling rates and are impacted by the questioned indirect rates. EPA's share of questioned indirect costs
totals $133,069.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
O/G Follow-Up Status: Resolution pending receipt of additional information.
Report No. 08-4-0002, Science Applications Intl. Corp—Company 1 Compensation Follow-Up, October 2, 2007
Summary: In DCAA's opinion, the contractor's compensation system and related internal control policies and
procedures are inadequate in part. DCAA's examination noted certain significant deficiencies in the design or
operation of the internal control structure that could adversely affect the contractor's ability to record, process,
summarize, and report compensation in a manner that is consistent with applicable government contract laws
and regulations.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
O/G Follow-Up Status: Resolution pending receipt of additional information.
Report No. 08-1-00114, Weston Solutions Inc.—FY 12/31/2004 Incurred Cost, March 24, 2008
Summary: DCAA determined that the contractor's claimed direct costs are acceptable; however, DCAA questioned
$2,082,837 in proposed indirect costs and rates. Further, DCAA applied penalties in accordance with Federal
Acquisition Regulation 42.709, and identified expressly unallowable costs subject to penalty that had been allocated
to various contracts specified in Federal Acquisition Regulation 42.709(b), including 11 EPA contracts. Of the
questioned costs, EPA's total share of questioned costs is $197,869, of which $164,163 is questioned overhead costs
and $33,706 is the questioned general and administrative costs.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
O/G Follow-Up Status: Resolution pending receipt of additional information.
Report No. 08-1-00131, Washington Group International, Inc.—FY 2001 Incurred Costs, April 15, 2008
Summary: DCAA questioned $2,208,686 of claimed direct costs and $13,757,945 of proposed indirect costs and
rates, a total of $15,966,631. EPA's share of the questioned costs is $44,648.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
O/G Follow-Up Status: Resolution pending receipt of additional information.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Report No. 08-1-0130, Morrison Knudsen Corporation—FY 1999 Incurred Costs, April 15, 2008
Summary: DCAA questioned $3,705,233 in claimed direct costs and $3,472,023 in proposed indirect costs and rates,
a total of $7,177,256 in questioned costs. EPA's share of questioned costs is $57,369.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
OIG Follow-Up Status: Resolution pending receipt of additional information.
Report No. 09-1-00034, Lockheed Martin Services Group—FY 2006 Incurred Cost, November 24, 2008
Summary: DCAA questioned $23,672,344 in claimed direct and proposed indirect costs and rates. Of this, $381,582
is claimed direct costs and $23,290,762 is proposed indirect costs and rates. DCAA also did not audit $159,778,286
in claimed subsidiary and subcontracts costs. EPA's share of the questioned costs is 3 percent, or $11,448 in claimed
direct costs and $698,722 in proposed indirect costs, a total of $710,170.
Agency Explanation: Resolution on hold. Resolution of audit results is not EPA's responsibility, but the responsibility
of the Department of Defense. Therefore, an expected resolution date cannot be determined at this time.
O/G Follow-Up Status: Resolution pending receipt of additional information.
Office of Chemical Safety and Pollution Prevention
Report No. 11-P-0215, EPA's Endocrine Disrupter Screening Program Should Establish Management
Controls to Ensure More Timely Results, May 3, 2011
Summary: In 1998, EPA established the Endocrine Disrupter Screening Program, which uses a two-tiered screening
and testing approach to assess endocrine effects. The program was expanded to include androgenic and thyroid
effects. The program has not developed a management plan laying out the program's goals and priorities or
established outcome performance measures to track program results. The program missed milestones for assay
validation and chemical selection established by a 2001 settlement agreement. The Endocrine Disrupter Screening
Program needs to develop and implement plans and performance measures to establish management control and
accountability. EPA plans to develop a management plan for the program but had not done so at the time of our review.
Agency Explanation: Office of Chemical Safety and Pollution Prevention and the OIG have been working to agree
upon appropriate corrective actions to implement the report's recommendations since it was issued. As of March 28,
2012, OIG has agreed to corrective actions for four of the six recommendations, and the Office of Chemical Safety
and Pollution Prevention is revising its corrective action plan to reflect an oral agreement reached on the remaining
recommendations. The projected resolution date was April 20, 2012.
OIG Follow-Up Status: Incomplete response.
Office of Enforcement and Compliance Assurance
Report No. 08-P-00278, Strategic Planning in Priority Enforcement Areas, September 25, 2008
Summary: The Office of Enforcement and Compliance Assurance has instituted a process for strategic planning in its
national enforcement priority areas. The FYs 2008-2010 strategic plans we reviewed—for air toxics, combined sewer
overflows, and mineral processing—contain an overall goal, a problem statement, and other key elements. However,
each of the plans is missing key elements to monitor progress and accomplishments and efficiently utilize Agency
resources. All three strategies lack a full range of measures to monitor progress and achievements. Two strategies
lack detailed exit plans. Additionally, the combined sewer overflow strategy does not address the states' key roles in
attaining the strategy's overall goal. The absence of these elements hinders Office of Enforcement and Compliance
Assurance from monitoring progress and achieving desired results in a timely and efficient manner.
Agency Explanation: The OIG issued a memorandum to the Office of Enforcement and Compliance Assurance on
January 20, 2010, that requested this office to change the designation of recommendation 2-2 in the Management
Audit Tracking System to "unresolved," and include it in the list of recommendations unresolved after a year. The OIG
also indicated that it would pursue this matter through the formal EPA audit resolution process.
OIG Follow-Up Status: Referred to Audit Resolution Board.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Region 4—Regional Administrator
Report No. 10-4-0001, Internal Control Weaknesses under EPA Grant Nos. I004802070 and BG96483308,
Awarded to the Eastern Band of Cherokee Indians, Cherokee, North Carolina, October 5, 2009
Summary: The OIG received a Hotline complaint regarding EPA assistance agreement nos. I004802070 and
BG96483308, awarded to the Eastern Band of Cherokee Indians, Cherokee, North Carolina. The grantee did not
have a conflict of interest, as alleged, and its Standard Form 272s were correct and prepared in compliance with
federal requirements, EPA policies, and grant terms and conditions. However, during the course of our examination,
we identified significant deficiencies in internal controls concerning equipment purchases and segregation of duties.
Some purchase authorizations were dated the same day equipment was delivered, three quotes were not always
obtained, and purchases were not always properly authorized. Also, one employee was authorized to write grant
proposals; solicit funding to carry out the program goals; prepare budgets; oversee the expenditure of funds; and
purchase, maintain, repair, and inventory all equipment. We recommended that EPA require the grantee to comply
with its internal control policies and establish additional internal controls as needed.
Agency Explanation: The region will revise its response to address the missing information as requested by the OIG.
The projected completion date is June 31, 2012.
OIG Follow-Up Status: No response.
Report No. 10-4-0003, Costs Claimed Under EPA Grant XP97424901 Awarded to West Rankin Utility
Authority, Flowood, Mississippi, October 13, 2009
Summary: The grantee did not meet the procurement and financial management requirements of Title 40 Code of
Federal Regulations Part 31. As a result, we questioned $1,745,457 in unsupported architectural and engineering
costs claimed. The grantee will need to repay $663,321 of grant funds. The grantee did not agree with those
questioned costs. Due to the noncompliances and internal control weaknesses noted, the grantee may not have the
capability to manage future grant awards.
Agency Explanation: The region is requesting a deviation from Title 40 Code of Federal Regulations Part 31.36 from
EPA headquarters. The projected completion date is May 31, 2012.
OIG Follow-Up Status: Incomplete response.
Report No.10-4-0013, Costs Claimed Under EPA Grant No. XP9468195 Awarded to the City of Flowood,
Mississippi, October 27, 2009
Summary: The grantee did not perform a cost analysis or negotiate a fair and reasonable profit as a separate element
of the contract price as required under Title 40 Code of Federal Regulations 31.36(f). As a result, we questioned
$1,755,157 in unsupported architectural and engineering costs claimed. The grantee will need to repay $896,224 of
grant funds. The grantee did not agree with those questioned costs.
Agency Explanation: The region is requesting a deviation from Title 40 Code of Federal Regulations Part 31.36 from
EPA headquarters. The projected completion date is May 31, 2012.
OIG Follow-Up Status: Incomplete response.
Report No. 11-3-0476, Aiken, South Carolina, County of, FY 2010, August 17, 2011
Summary: The county has historically relied on outside accounting firms to draft its annual financial statements. The
independent auditor found that the county did not have adequate internal controls to track, reconcile, and post cash
transactions properly. The independent auditor also found that the county did not have procedures in place to ensure
that the required reports for the Brownfields projects were submitted accurately and timely.
Agency Explanation: The grants specialist is working to resolve this finding. The grantee will be notified that written
confirmation is needed to verify that all proposed corrective actions are in place as stated in its October 31, 2011,
response. The projected completion date is May 31, 2012.
OIG Follow-Up Status: Resolution pending receipt of additional information.
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October 1, 2011—March 31, 2012
Region 5—Regional Administrator
Report No. 11-R-0700, American Recovery and Reinvestment Act Site Visit of Wastewater Treatment Plant—
Phase II Improvement Projects, City of Ottawa, Illinois, September 23, 2011
Summary: The city could not provide sufficient documentation to support that some manufactured goods used on the
project met the Buy American requirements of Section 1605 of the Recovery Act. The documentation did not
demonstrate clearly that items were either manufactured in the United States or substantially transformed in the
United States. As a result, the state's use of over $3.8 million of Recovery Act funds on the project is prohibited by
Section 1605 of the Recovery Act, unless a regulatory option is exercised. We recommended that the Regional
Administrator employ the procedures set out in Title 2 of the Code of Federal Regulations to resolve the
noncompliance on the Ottawa project.
Agency Explanation: The OIG response sent March 15, 2012, indicated disagreement with the regional management
decision. This disagreement is expected to be elevated to the dispute process. The OIG has asked the Office of
Water to revise its guidance and for Region 5 to review its decision using the new guidance. The OIG also sent this
information to the Chief Financial Officer.
OIG Follow-Up Status: Resolution under negotiation in headquarters.
Region 7—Regional Administrator
Report No. 11-3-0304, Nebraska, State of- FY 2010, June 29, 2011
Summary: The Nebraska Department of Environmental Quality had several issues regarding compliance with the
allowable costs/cost principles including: (1) expenditures that did not have adequate supporting documentation for
reimbursement of actual expenses incurred, and (2) seven expenditures that did not have contract language outlining
disposition of items purchased with Recovery Act funding. As such, we have questioned $113,972 in expenditures.
Agency Explanation: The final determination letter was signed on March 30, 2012. The letter was mailed and
e-mailed on March 30, 2012. OIG closeout will most likely occur in April 2012.
OIG Follow-Up Status: No response.
Report No. 11-3-0638, Colby, Kansas, City of- FY 2010, September 14, 2011
Summary: The city did not report all expenditures on its 2009 Schedule of Expenditures of Federal Awards. A similar
finding was noted in the prior year audit report. The city's procurement process did not comply with many requirements
in Title 40 Code of Federal Requirements Part 31, as required for a state or local government receiving EPA grant
funds. Because the city's procurement process was significantly flawed, the single auditor issued a qualified opinion on
major program compliance. According to Region 7, the majority of the expenses charged under this project are contract
related. Therefore, we have questioned all expenditures reported in FY 2010 as unsupported, totaling $711,650.
Agency Explanation: Awaiting approval or disapproval of a request for deviation from select procurement regulations
for the city. Draft final determination letter expected to be sent to the OIG by July 31, 2012.
OIG Follow-Up Status: No response.
Region 8—Regional Administrator
Report No. 2007-4-00078, Cheyenne River Sioux Tribe, September 24, 2007
Summary: The tribe did not comply with the financial and program management standards under Title 40 Code of
Federal Regulations Parts 31 and 35, and OMB Circular A-87. We questioned $3,101,827 of the $3,736,560 in
outlays reported. The tribe's internal controls were not sufficient to ensure that outlays reported complied with federal
cost principles, regulations, and grant conditions. In some instances, the tribe also was not able to demonstrate that it
had completed all work under the agreements and had achieved the intended results.
Agency Explanation: Projected completion date is July 15, 2012. An analysis has been completed and the region has
prepared a final determination letter pending a deviation being granted by EPA's Office of Grants and Debarment.
OIG Follow-Up Status: No response.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Report No. 08-3-0307, Oglala Sioux Tribe, FY 2004, September 30, 2008
Summary: The single auditor's findings indicate that the tribe may not be able to support the costs claimed under
EPA grants. As a result, we are questioning the costs claimed of $1,158,903.
Agency Explanation: A final determination letter has been drafted that will require OIG review and consultation due to
potential disallowed costs. Projected completion date is May 1, 2012.
OIG Follow-Up Status: Proposed response received and in review process.
Report No. 09-3-0252, Oglala Sioux Tribe, FY 2005, September 29, 2009
Summary: The single auditor's findings indicate that the tribe may not be able to support the costs claimed under
EPA grants. As a result, we are questioning the costs claimed during 2005 of $307,323 as being unsupported.
Agency Explanation: A final determination letter has been drafted that will require OIG review and consultation due to
potential disallowed costs. Projected completion date is May 1, 2012.
OIG Follow-Up Status: No response.
Report No. 09-3-0253, Oglala Sioux Tribe, FY 2006, September 30, 2009
Summary: The single auditor's findings indicate that the tribe may not be able to support the costs claimed under
EPA grants. As a result, we are questioning the costs claimed in 2006 of $530,042 as being unsupported.
Agency Explanation: A final determination letter has been drafted that will require OIG review and consultation due to
potential disallowed costs. Projected completion date is May 1, 2012.
OIG Follow-Up Status: No response.
Region 9—Regional Administrator
Report No. 10-P-0112, Results of Hotline Complaint Review of EPA Region 9 Hiring under the Federal Career
Intern Program, April 26, 2010
Summary: The hotline allegations against EPA Region 9 were unsubstantiated. We identified that the region
engaged in a prohibited personnel practice. Neither the Office of Personnel Management nor EPA prohibits the use
of a job fair and registration code as recruiting and hiring methods. However, Region 9 engaged in a prohibited
personnel practice by giving four Federal Career Intern Program job fair participants improper advantages not
provided to others attending the job fair.
Agency Explanation: The OIG had referred the subject audit to the Office of Special Counsel for resolution. The
status of the three recommendations listed in the final report is still undecided. Recommendation 1 is directed to
Region 9 and is pending for the Office of Special Counsel decision.
OIG Follow-Up Status: Incomplete response.
Report No. 11-3-0150, Summit Lake Paiute Tribe FY 2008, March 9, 2011
Summary: The OIG questioned as unsupported $291,097 in EPA expenditures. We found a lack of segregation of
duties over financial records, and interim financial status reports being filed late and not being reconciled to the
general ledger. Due to the severity of the findings and the going concern risk, we recommended that EPA consider
the recipient to be high-risk in accordance with Title 40 Code of Federal Regulations 31.12, and place appropriate
restrictions/grant conditions upon the recipient. Also, we recommended that EPA input these findings into the Grantee
Compliance Database and consider this information as a part of future pre-award decisions.
Agency Explanation: The tribe is concurrently working on three audits. This single audit was requested to be on hold
pending outcome of the agreed-upon procedures. Final determination letter for agreed-upon procedures was sent out
March 15, 2012. OIG reactivated the single audit on March 16, 2012, and is waiting for the request for funds letter
($96,615) to be sent to the tribe. Final determination letter is projected to be issued by the end of April 2012.
OIG Follow-Up Status: Resolution pending receipt of additional information.
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Semiannual Report to Congress October 1, 2011—March 31, 2012
Report No. 11-3-0151, Summit Lake Paiute Tribe FY 2008, March 9, 2011
Summary. The OIG questioned as unsupported $301,113 in EPA expenditures. We found a lack of segregation of
duties over financial records, interim financial status reports being filed late and not being reconciled to the general
ledger, and the tribe drawing down grant funds to cover deficits in other funds. As a result, the single auditor
questioned $1,070,651 in deferred revenue balance in excess of cash on hand. Due to the severity of the findings
and the going concern risk, we recommended that EPA consider the recipient to be high-risk in accordance with
Title 40 Code of Federal Regulations 31.12, and place appropriate restrictions/grant conditions upon the recipient.
Also, we recommended that EPA input these findings into the Grantee Compliance Database and consider this
information as a part of future pre-award decisions.
Agency Explanation: The tribe is concurrently working on three audits. This single audit was requested to be on hold
pending outcome of the agreed-upon procedures. Final determination letter for agreed-upon procedures was sent out
March 15, 2012. OIG reactivated the single audit on March 16, 2012, and is waiting for the request for funds letter
($96,615) to be sent to the tribe. Final determination letter is projected to be issued by the end of April 2012.
OIG Follow-Up Status: Report activated, awaiting response.
Total reports issued before reporting period for which
no management decision had been made as of March 31, 2012 = 32
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Appendix 3—Reports With Corrective Action Not Completed
In compliance with reporting requirements of Section 5(a)(3) of the Inspector General Act, as amended,
"Identification of Reports Containing Significant Recommendations Described in Previous Semiannual
Reports on Which Corrective Action Has Not Been Completed," and to help EPA managers gain greater
awareness of outstanding commitments for action, we developed a Compendium of Unimplemented
Recommendations. This separate document provides the information required in appendix 3 to this
Semiannual Report to Congress. This compendium (available upon request or at
http://www.epa.qov/oiq/reports/2012/20120430-12-N-0434.pdf) is produced semiannually for Agency
leadership and Congress based on Agency reports on the status of action taken on OIG
recommendations and OIG selective verification of that reported status.
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Semiannual Report to Congress
October 1, 2011—March 31, 2012
Appendix 4—OIG Mailing Addresses and Telephone Numbers
Headquarters
U.S. Environmental Protection Agency
Office of Inspector General
1200 Pennsylvania Ave., NW(2410T)
Washington, DC 20460
(202) 566-0847
Atlanta
U.S. Environmental Protection Agency
Office of Inspector General
61 Forsyth Street, SW
Atlanta, GA 30303
Audit/Evaluation: (404) 562-9830
Investigations: (404) 562-9857
Boston
U.S. Environmental Protection Agency
Office of Inspector General
5 Post Office Square, Suite 100 (OIG15-1)
Boston, MA 02109-3912
Audit/Evaluation: (617) 918-1470
Investigations: (617) 918-1466
Chicago
U.S. Environmental Protection Agency
Office of Inspector General
77 West Jackson Boulevard
13th Floor (IA-13J)
Chicago, IL 60604
Audit/Evaluation: (312) 353-2486
Investigations: (312) 353-2507
Cincinnati
U.S. Environmental Protection Agency
Office of Inspector General
26 West Martin Luther King Drive
Cincinnati, OH 45268-7001
Audit/Evaluation: (513) 487-2360
Investigations: (513) 487-2364
Dallas
U.S. Environmental Protection Agency
Office of Inspector General (6OIG)
1445 Ross Avenue, Suite 1200
Dallas, TX 75202-2733
Audit/Evaluation: (214) 665-6621
Investigations: (214) 665-2790
Offices
Denver
U.S. Environmental Protection Agency
Office of Inspector General
1595 Wynkoop Street, 4th Floor
Denver, CO 80202
Audit/Evaluation: (303) 312-6969
Investigations: (303) 312-6868
Kansas City
U.S. Environmental Protection Agency
Office of Inspector General
901 N. 5th Street
Kansas City, KS66101
Audit/Evaluation: (913) 551-7878
Investigations: (913) 551-7875
New York
U.S. Environmental Protection Agency
Office of Inspector General
290 Broadway, Room 1520
New York, NY 10007
Audit/Evaluation: (212) 637-3049
Investigations: (212) 637-3041
Philadelphia
U.S. Environmental Protection Agency
Office of Inspector General
1650 Arch Street, 3rd Floor
Philadelphia, PA 19103-2029
Audit/Evaluation: (215) 814-5800
Investigations: (215) 814-5820
Research Triangle Park
U.S. Environmental Protection Agency
Office of Inspector General
Mail Drop N283-01
Research Triangle Park, NC 27711
Audit/Evaluation: (919) 541-2204
Investigations: (919) 541-1027
San Francisco
U.S. Environmental Protection Agency
Office of Inspector General
75 Hawthorne Street (IGA-1)
7th Floor
San Francisco, CA 94105
Audit/Evaluation: (415) 947-4521
Investigations: (415) 947-4500
Seattle
U.S. Environmental Protection Agency
Office of Inspector General
12006th Avenue, 19th Floor
Suite 1920, M/SOIG-195
Seattle, WA 98101
Audit/Evaluation: (206) 553-6906
Investigations: (206) 553-1273
Winchester
U.S. Environmental Protection Agency
Office of Inspector General
200 S. Jefferson Street, Room 314
P.O. Box 497
Winchester, TN 37398
Investigations: (423) 240-7735
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Report fraud, waste or abuse
e-mail: OIG_Hotline@epa.gov
write: EPA Inspector General Hotline
1200 Pennsylvania Avenue NW
Mailcode2431T
Washington DC 20460
fax: 202-566-2599 • phone: 1-888-546-8740
www.epa.gov/oig/hotline.htm
It's your money
It's your environment
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