U.S. ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF INSPECTOR GENERAL
Semiannual Report to Congress
April 1, 2012-September 30, 2012
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EPA-350-R-12-003
November 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)(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)
Section 5(a)(14)
Abbreviations
CIGIE
CSB
DCAA
EPA
FY
OEI
OIG
Subject
Review of legislation and regulations
Significant problems, abuses, and deficiencies
Significant recommendations for corrective action
Reports with corrective action not completed
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
Peer reviews conducted
Council of the Inspectors General on Integrity and Efficiency
U.S. Chemical Safety and Hazard Investigation Board
Defense Contract Audit Agency
U.S. Environmental Protection Agency
Fiscal Year
Office of Environmental Information
Office of Inspector General
Pages
30-32
2-28, 33-34
2-24, 33-34
56
25-28, 35, 39
None
40-47
2-24, 33-34
35-37, 40-47
35-37, 40-47
36-37, 48-55
None
None
57
Cover photos:
Clockwise, from top left: a view of work being done with Recovery Act funds at the
Gilt Edge Mine Superfund site in Lawrence County, South Dakota (EPA OIG photo);
examples of pharmaceuticals that may pose disposal problems (EPA photo); and
students in a Richmond, California, Environmental Job Training program (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
April 1, 2012—September 30, 2012
Message to Congress
Arthur A. Elkins, Jr.
During this semiannual period, we issued reports designed to help
the U.S. Environmental Protection Agency (EPA) in its efforts to
improve human health and the environment. One example is our
audit of EPA's activities concerning the disposal of pharmaceutical
waste. Since 1980, EPA has not used its authority to determine
whether pharmaceuticals may qualify as hazardous waste. The
improper disposal of pharmaceutical waste in water bodies around
the country has raised serious concerns. We recommended that EPA
establish a process to review pharmaceuticals for regulation as
hazardous waste and develop an outreach and compliance assistance
plan for health care facilities managing such waste. In another
report, we noted that although EPA stated that its economic analysis
for its 2008 Lead Rule underwent extensive intra-Agency review
and was approved by the Office of Management and Budget prior to
publication, EPA used limited data to develop the rule's cost and
benefit estimates. We recommended that EPA reexamine the costs and benefits of the 2008 Lead
Rule and a 2010 amendment to determine whether the rule should be modified, streamlined,
expanded, or repealed.
Regarding Agency business practices and accountability, we found that EPA did not have
effective oversight of contractor-held property, and overstated such property by $34.6 million in
the fiscal year 2010 financial statements. In another report, we noted that EPA did not recover
$ 11 million in indirect costs on reimbursable interagency agreements for which EPA had
provided goods or services to another agency. An audit of a grant found that the grantee did not
comply with applicable financial management regulations and we recommended that EPA should
recover about $1.2 million in questioned costs. These recovered funds could be used for other
essential environmental protection activities.
On September 30, 2012, funding under the American Recovery and Reinvestment Act of 2009
expired. The Office of Inspector General (OIG) received $20 million to oversee the expenditure
of the $7.2 billion EPA received under the Recovery Act. We spent $18.6 million of the funds
we received, and I am pleased to report that our audit, evaluation, and investigative work resulted
in $28.3 million in monetary benefits. During the most recent semiannual reporting period, we
found that an Oregon firm did not provide support to show that $9 million in Recovery Act funds
drawn were reasonable, allocable, and allowable, and we recommended that EPA should disallow
and recover that amount. We also questioned whether some materials used for Recovery Act
projects in South Dakota and Indiana met the Recovery Act's Buy American requirement. Our
work related to the Recovery Act also included conducting outreach both with the Agency and
those receiving funds from EPA. We conducted 175 such awareness briefings and outreach
sessions, and they played an important part in the OIG's efforts to help deter fraud, waste, and
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Semiannual Report to Congress April 1, 2012—September 30, 2012
abuse. Although our Recovery Act funding has expired, we will continue to review the Agency's
expenditure of Recovery Act funds as part of our regular oversight activities.
During this reporting period, we issued several reports related to homeland security. Our review
of EPA's implementation of its Radiation Network system, which monitors environmental
radioactivity in the United States, disclosed weaknesses involving broken monitors, late filter
changes, monitors that have not been installed, and unresolved contracting issues. Our review of
EPA's National Security Information program found that the Agency can create, receive, handle,
and store classified material needed to fulfill its responsibilities related to homeland security,
although we noted some areas for potential improvement.
Our investigative work also produced significant results. A Maryland man was convicted at a trial
of selling more than $9 million in phony bio-diesel credits. The government is seeking forfeiture
of property and bank accounts already seized by the government, as well as any other proceeds
traceable to the offense, in order to satisfy a money judgment of $9 million. In another case,
several telemarketers for a Florida company were sentenced to home detention and/or supervised
release on charges related to their falsely claiming a relationship between their product and EPA.
Also, a South Dakota woman was sentenced to prison for embezzling funds from a tribal
organization.
I am very proud to announce that, for their work concerning the Deepwater Horizon oil spill, a
multi-disciplinary team of our auditors, evaluators, and attorneys received the prestigious
Alexander Hamilton Award from the Council of the Inspectors General on Integrity and
Efficiency. This award is the highest honor bestowed by the Council and recognizes
achievements in improving the integrity, efficiency, or effectiveness of Executive Branch agency
operations.
Our work would not be possible without support from Agency leadership and Congress. With
our renewed focus on ensuring that the Agency and the OIG are responsible stewards of taxpayer
dollars, our work will continue to add value and assist the Agency in accomplishing its mission of
safeguarding the health of the American people and protecting the environment.
Arthur A. Elkins, Jr.
Inspector General
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Semiannual Report to Congress April 1, 2012—September 30, 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
Key Topics 2
Recovery Act 2
Homeland and Cyber Security 6
Other Significant OIG Activity 10
Human Health and the Environment 10
Agency Business Practices and Accountability 15
Investigations 25
Other Activities 29
U.S. Chemical Safety and Hazard Investigation Board 33
Statistical Data 35
Profile of Activities and Results 35
Audit, Inspection, and Evaluation Report Resolution 36
Hotline Activity 38
Summary of Investigative Results 39
Appendices 40
Appendix 1—Reports Issued 40
Appendix 2—Reports Issued Without Management Decisions 48
Appendix 3—Reports With Corrective Action Not Completed 56
Appendix 4—Peer Reviews Conducted 57
Appendix 5—OIG Mailing Addresses and Telephone Numbers 58
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Semiannual Report to Congress
April 1, 2012—September 30, 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 was $8.4 billion.
EPA Office of Inspector General
The Office of Inspector General (OIG), established by the Inspector General Act of 1978,
as amended, 5 U.S.C. App. 3, 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. OIG staff are 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 $51.9 million 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). Our vision, mission, and goals are as follows:
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.
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
April 1, 2012—September 30, 2012
Key Topics
Recovery Act
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RECOVERY.GOV
The American Recovery and Reinvestment Act of 2009
(Recovery Act) provided EPA OIG $20 million for oversight
activities. The OIG conducted 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 through September 30, 2012, when our
Recovery Act funding expired, the OIG expended $18.6 million of the $20 million in
Recovery Act funds it had received, or 93 percent. Our audit, evaluation, and
investigative work resulted in $28.3 million in monetary benefits (such as questioned
costs and savings), or a 152 percent return on investment. The OIG produced 49 audit
and evaluation reports. We had received 91 complaints related to EPA Recovery Act
funds. We had conducted 175 Recovery Act awareness briefings and outreach sessions.
Investigative efforts have resulted in 5 indictments/convictions, 3 civil actions, and
24 administrative actions taken (such as suspensions, debarments, and disciplinary
actions). Although the OIG's Recovery Act funding has expired, we are continuing to
review how EPA Recovery Act funding was spent.
Details on OIG Recovery Act efforts during the semiannual reporting period ending
September 30, 2012, follow.
Cooperative Agreement Funding of $9 Million Questioned
Cascade Sierra Solutions, Eugene, Oregon, did not provide support to show that
$9 million in Recovery Act funds drawn under a cooperative agreement were
reasonable, allocable, and allowable in accordance with applicable laws,
regulations, and cooperative agreement terms and conditions.
EPA provided $9 million to Cascade Sierra Solutions under a cooperative agreement to
create a revolving loan program for heavy duty diesel trucks to save fuel and reduce
emissions. We noted financial management system issues pertaining to cash draws,
revolving fund accounting, project costs, and progress reporting. Also, procurements did
not meet competition or cost-price analysis requirements. Further, reporting of the
number of jobs created or retained with Recovery Act funds did not comply with
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
guidance. As a result, we questioned the
agreement as unallowable costs.
million drawn under the cooperative
We recommended that EPA disallow and recover the $9 million and consider suspension
and debarment of Cascade Sierra Solutions. EPA generally agreed with the
recommendations and said it initiated corrective actions, but Cascade Sierra Solutions
generally did not agree.
(Report No. 12-R-0749, Examination of Costs Claimed Under EPA Cooperative
Agreement 2A-83440701 Awarded Under the Recovery Act to Cascade Sierra Solutions,
Eugene, Oregon, September 4, 2012)
Site Visits Note Issues Regarding Buy American Requirements
As a result of site visits, we questioned whether two Recovery Act funding
recipients were meeting the Recovery Act's Buy American requirements.
EPA provided $2,935,228 in Recovery Act funding for Pacific Western Technologies.
Part of the funding went to a subcontractor to perform the drilling and grouting portion of
diversion ditch repair at the Gilt Edge Mine Superfund site project in Lawrence County,
South Dakota. Pacific Western Technologies did not have adequate controls to ensure
that its subcontractors and vendors complied with the Buy
American and Davis-Bacon Act provisions of the Recovery
Act. Non-American-made steel grouting pipes were used in the
project. As a result, we questioned $349,635 in costs incurred,
consisting of ineligible pipe costs of $88,712 and unsupported
field inspection costs of $260,923. Also, Pacific Western
Technologies did not verify whether subcontract vendor
employees who worked at the site were paid according to
Davis-Bacon Act requirements. We recommended that EPA
advise the contracting officer to designate the grouting pipe
cost of $88,712 as ineligible costs. We also recommended that
EPA disallow and recover field inspection costs. Pacific
Western Technologies indicated it is working with the
contracting officer to deobligate $88,712. The contactor proposed, and EPA accepted,
$2,551 as the amount of ineligible field supervision costs. (Report No. 12-R-0601,
American Recovery and Reinvestment Act Site Visit of the Division Ditch Repair Project
at the Gilt Edge Mine Superfund Site, Lawrence County, South Dakota, July 25, 2012)
The City of Nappanee, Indiana, received a $4,875,000 loan from the Indiana Finance
Authority, including $1,769,000 in Recovery Act funds. The city used these funds to
rehabilitate and improve its wastewater treatment plant. We noted in our draft report 7 of
32 instances where the city could not demonstrate compliance with Buy American
Grouting pipes for the Gilt Edge Mine
Superfund site project labeled
Made in Korea. (EPA OIG photo)
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Label on a Kaeser blower indicating
product was made in Germany.
(EPA OIG photo)
requirements. In response, the city provided
documentation and agreed to take corrective actions
to replace two items with products that meet Buy
American requirements. We agree that six of the
seven items now comply with the requirements.
For the one remaining item, the city could not
demonstrate that it was manufactured in the United
States as required. As a result, the project is not
eligible for the $1,769,000 of Recovery Act funds
authorized by the state unless EPA exercises a
regulatory option. We recommended that EPA
employ appropriate procedures to ensure
compliance with the Buy American requirements. Neither EPA nor the recipient agreed
with our conclusions. (Report No. 12-R-0789, American Recovery and Reinvestment Act
Site Visit of Wastewater Treatment Plant Improvements Project, City ofNappanee,
Indiana, September 12, 2012)
Dollars Leveraged Not Always Verified for Brownfields Efforts
EPA project officers verified grant recipient reported outputs and outcomes for
Recovery Act brownfields assessments completed, acres ready for reuse, and
cleanups completed, but did not always verify dollars leveraged.
EPA awarded $87.3 million in Recovery Act brownfields assessment, cleanup, and
revolving loan fund grants to state agencies, tribes, non-profits, local communities and
commissions, and other entities. Dollars leveraged are additional non-EPA resources
invested in the project as a result of the use of grant funds. EPA anticipated leveraging
$450-$600 million for brownfields work by 2012.
EPA guidance includes requirements for grant recipients to report, and for EPA project
officers to review, grant output and outcome information in the online Assessment,
Cleanup and Redevelopment Exchange System. However, the guidance does not specify
the documentation needed to support dollars leveraged. Recipients were unclear as to
what could be counted as dollars leveraged, and some project officers were not aware of
the requirement to verify reported dollars leveraged. As a result, EPA's Office of
Brownfields and Land Revitalization and others may not be able to rely on the dollars
leveraged data in the online system, which is reported to Congress and the public. Dollars
leveraged may not be realized until after grants are completed, and EPA has to rely on
recipients to report this information after their grants are completed, which may be as late
as the end of 2014.
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Semiannual Report to Congress April 1, 2012—September 30, 2012
We recommended that EPA create a checklist for grant recipients and project officers that
defines dollars leveraged and identifies specific types of supporting documents needed.
EPA agreed with our recommendations and provided intended corrective actions.
(Report No. 12-R-0898, EPA Can Improve Its Reporting of Dollars Leveraged From the
American Recovery and Reinvestment Act Brownfields Program, September 27, 2012)
Task Force Investigates Potential Recovery Act Fraud, Waste, and
Abuse
A task force created by EPA OIG's Office of Investigations reviewed numerous
Recovery Act projects during the semiannual reporting period and worked on
allegations related to fraud, noncompliance with Recovery Act provisions, and
employment of illegal workers.
The EPA OIG created the task force to expand upon the Office of Investigation's initial
three-pronged strategy involving (1) stakeholder education; (2) outreach; and
(3) identification and investigation of potential instances of fraud, waste, and abuse in
EPA programs funded by the Recovery Act. The task force included 33 EPA OIG special
agents who were hired as temporary employees with Recovery Act funding. Task force
members sought to determine whether Recovery Act funding recipients were complying
with Buy American provisions; the Davis-Bacon Act (involving wage requirements);
and, if applicable, rules governing surety bonds.
During the approximately 9 months of its existence, the task force visited all 51
Superfund sites that received Recovery Act funding. In addition, the task force reviewed
approximately 250 other projects that received Recovery Act funds involving Clean
Water and Drinking Water State Revolving Fund activities. The task force members
interviewed hundreds of people.
The task force worked with Assistant U.S. Attorneys and the U.S. Department of Justice
to prosecute individuals who committed fraud or failed to comply with Recovery Act
provisions. The team also worked with U.S. Immigration and Customs Enforcement
related to actions to remove illegal workers from the United States.
The efforts started by the task force are being continued by permanent OIG special agents
following the September 30, 2012, expiration of Recovery Act funding.
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Homeland and Cyber Security
The OIG conducts reviews to help EPA prevent and deal with terrorist attacks and other
threats, including threats to its information technology systems and resources.
Management Weaknesses of Radiation Network System Need Attention
Our review of EPA's implementation of its Radiation Network system disclosed
weaknesses involving broken monitors, late filter changes, monitors that had not
been installed, and unresolved contracting issues.
The Radiation Network system monitors environmental radioactivity in the United States
and provides data for assessing public exposure and environmental impacts during
nuclear emergencies and routine conditions. The Radiation Network system played a
critical role in monitoring radiation levels in the United States during the March 2011
Japan nuclear incident.
Broken Radiation Network monitors and late filter changes impaired this critical
infrastructure asset. During the Japan nuclear incident, 25 of the 124 installed Radiation
Network monitors were out of service for an average of 130 days. Additionally, 6 of the
12 monitors sampled had gone over 8 weeks without a filter change. Parts shortages and
insufficient contract oversight contributed to repair delays. Out-of-service monitors and
unchanged filters may reduce the
quality and availability of critical
data needed to assess radioactive
threats. EPA remains behind
schedule for installing Radiation
Network monitors and did not fully
resolve contracting issues
identified in a 2009 OIG report.
We recommended that EPA
improve planning and management
of parts availability, filter
replacement, and installation of the
remaining Radiation Network
monitors. We also recommended
that EPA require contracting
officers and their representatives to
formally evaluate Radiation
Network contractors annually and
Location of Radiation Network monitors nationwide (April 2011)
Source: EPA Japan Nuclear Emergency: Radiation Monitoring website,
http://www.epa.aov/iapan2011/rert/radnet-data-map.html/.
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Semiannual Report to Congress April 1, 2012—September 30, 2012
ensure that the Agency's Management Audit Tracking System is accurate and current.
The Agency concurred with the recommendations except for developing metrics for
evaluating frequency of filter changes and completing contractor performance
evaluations, both of which are considered unresolved.
(Report No. 12-P-0417, Weaknesses in EPA 's Management of the Radiation Network
System Demand Attention, April 19, 2012)
EPA Generally Meeting National Security Information Requirements
Through its National Security Information program, EPA can create, receive,
handle, and store classified material needed to fulfill its responsibilities related to
its homeland security, emergency response, and continuity missions.
Nonetheless, we noted some areas for potential improvement.
Executive Order 13526, Classified National Security Information, prescribes a uniform
system for classifying, safeguarding, and declassifying national security information. We
performed this review on EPA's National Security Information infrastructure as required by
the Reducing Over-Classification Act. Under its classified National Security Information
program, EPA has assigned responsibilities and provided guidance, training, and oversight.
EPA program offices provide secure equipment and space, following specifications. EPA
has procedures in place to enable employees to obtain security clearances and classify
information. Annual reports are prepared on the status of the program.
We found that EPA's National Security Information program needs improved internal
controls to address deficiencies. These deficiencies involved the storage of signed
nondisclosure agreements in employees' Official Personnel Folders; ensuring the
completion of annual refresher training; the prompt withdrawal of a clearance when a
cleared employee leaves EPA; and updating EPA's regulation, policies, and guidance for
the program. We recommended that EPA issue a directive to establish needed controls
and the Agency agreed to take appropriate alternate corrective actions.
(Report No. 12-P-0543, EPA's National Security Information Program Could Be
Improved, June 18, 2012)
EPA Needs to Improve Network Security Monitoring Program
EPA's deployment of a Security Incident and Event Management tool for network
security monitoring did not comply with EPA's system life cycle management
procedures.
Continuously monitoring network threats through intrusion detection and prevention
systems is essential. Establishing clear procedures for assessing the current and potential
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Semiannual Report to Congress April 1, 2012—September 30, 2012
business impact of incidents is critical, as is implementing effective methods of
collecting, analyzing, and reporting data.
EPA did not develop a comprehensive deployment strategy for the Security Incident and
Event Management tool to incorporate all of EPA's offices or a formal training program
on how to use the tool. When EPA staff are not able to use an information technology
investment, the investment has limited value. Also, EPA does not have a computer
security log management policy consistent with federal requirements, which can result in
logged data not being available when needed and security controls not being
implemented. Further, EPA did not follow up with staff to confirm whether corrective
actions were taken to address known information security weaknesses.
We recommended that EPA develop and implement a strategy to incorporate EPA's
headquarters program office within the Security Incident and Event Management
environment, develop formal training for using the tool, develop or revise policy as
needed for audit logging, and require that the Senior Agency Information Security
Officer be addressed on all Office of Environmental Information security reports and
reviews. EPA agreed to take the recommended corrective actions.
(Report No. 12-P-0899, Improvements Needed in EPA 's Network Security Monitoring
Program, September 27, 2012)
EPA Should Improve Security Controls for Its Network Directory
Service System
EPA is not managing key facets of its network directory service system, inhibiting
EPA's compliance with key risk management practices and placing EPA's
information and systems at risk.
A directory service provides a centralized location to store information about the users,
computers, and other equipment on a network and provides integrated services that are
used to manage network users, services, and devices. EPA uses a commercial product for
its directory service system. EPA implements this system using multiple servers in
various locations on its network to provide authentication and authorization.
We found that EPA's Office of Environmental Information does not manage key system
management documentation, system administration functions, the granting and
monitoring of privileged accounts, and the application of environmental and physical
security controls associated with its directory service system. The office is not keeping
key management documentation associated with the system current and complete and
does not have an oversight process to ensure regions and program offices are managing
their delegated responsibilities in accordance with Agency and federal requirements.
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Semiannual Report to Congress April 1, 2012—September 30, 2012
We recommended that EPA undertake a number of corrective actions to address specific
deficiencies and improve its management of the Agency's network directory service
system. EPA agreed with most of the recommendations and took steps to correct several
of the identified weaknesses. However, two recommendations, regarding environmental
and physical security controls, remain unresolved.
(Report No. 12-P-0836, EPA Should Improve Management Practices and Security
Controls for Its Network Directory Service System and Related Servers, September 20,
2012)
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Other Significant OIG Activity
Human Health and the Environment
EPA Procedures for Hazardous Waste Pharmaceuticals Need
Improvement
Since 1980, EPA has not used its authority to determine whether
pharmaceuticals may qualify as hazardous waste. EPA also has not established
a process for the regular identification and review of pharmaceuticals that may
qualify for regulation as hazardous waste.
EPA has the authority under the Resource Conservation and Recovery Act to regulate
hazardous waste pharmaceuticals to ensure safe management and disposal practices, but
EPA has not been using this authority. We identified eight chemicals found in
pharmaceuticals that meet EPA's criteria for regulation as acute hazardous waste, but
wastes containing these chemicals are not regulated
as such. There are over 100 drugs that federal
occupational safety organizations have identified as
hazardous but may not have been reviewed by EPA
to determine whether they may qualify as hazardous
waste. Also, some health care facilities, such as
hospitals, may be unaware of federal hazardous
waste regulations.
o m
Examples of pharmaceuticals. (EPA photo)
In 2008, EPA proposed an amendment to the
Universal Waste Rule to address pharmaceutical
wastes. However, no action on the rule has occurred
since the close of the public comment period in 2009. During our review, EPA staff
informed us that the Agency has decided to develop another proposal, and EPA
anticipates the proposal will be available for public comment in spring 2013.
We recommended that EPA establish a process to review pharmaceuticals for regulation
as hazardous waste and develop an outreach and compliance assistance plan for health
care facilities managing hazardous waste pharmaceuticals. The Agency agreed with all
recommendations and is implementing corrective actions to address them.
(Report No. 12-P-0508, EPA Inaction in Identifying Hazardous Waste Pharmaceuticals
May Result in Unsafe Disposal, May 25, 2012)
10
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Semiannual Report to Congress April 1, 2012—September 30, 2012
EPA's Economic Analysis for Lead Rule Used Some Limited Data
Although EPA stated that its economic analysis for its 2008 Lead; Renovation,
Repair, and Painting Rule (Lead Rule) underwent extensive intra-Agency review
and was approved by the Office of Management Budget prior to publication,
EPA used limited data to develop the rule's cost and benefit estimates.
The purpose of the Lead Rule was to address lead-based paint hazards created by
renovation, repair, and painting activities that disturb lead-based paint in target housing.
Federal agencies are required to analyze the costs and benefits of significant regulatory
actions. A hotline complaint questioned aspects of the rule.
We did not conclude that EPA violated policies or failed to follow requirements in
conducting its analysis. Rather, EPA conducted its economic analysis under time
pressures and subsequently used its discretion to complete its analysis using some limited
data and approaches. EPA's economic analyses were limited in that:
• The estimated cleaning and containment work practice costs to comply with the
rule were not based on a statistically valid survey.
• EPA did not quantitatively analyze or include some of the costs outlined in
Agency guidance.
• EPA did not include the cost to renovation businesses of securing additional
liability insurance.
• EPA recommended additional work practices in a training program that, while
not required by the rule, would likely result in additional cost because the
regulated community would view these practices as required.
Further, an EPA science advisory committee reported that limitations in the Agency's
data for estimating intelligence quotient changes in children exposed to lead dust during
renovations would not adequately support a rigorous cost-benefit analysis.
We recommended that EPA reexamine the costs and benefits of the 2008 Lead Rule and
a 2010 amendment to determine whether the rule should be modified, streamlined,
expanded, or repealed. We also recommend that EPA add a disclaimer to its training
program materials to communicate the differences between required and recommended
work practices. In its response to the report, EPA disagreed with the first
recommendation but agreed with the second.
(Report No. 12-P-0600, Review of Hotline Complaint Concerning Cost and Benefit
Estimates for EPA 's Lead-Based Paint Rule, July 25, 2012)
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
EPA Could Improve Verification for SmartWay Transport Program
Recent studies corroborate EPA's claims that its SmartWay Transport
Partnership program helps remove marketplace barriers in order to deploy fuel
efficient technologies faster. However, to calculate SmartWay program emission
reductions, EPA relies on self-reported industry data. EPA performs some
checks of data provided by industry, but there is no independent direct
verification of EPA data submitted by SmartWay participants and EPA could
improve the process.
EPA established the SmartWay Transport Partnership in 2004. It is a voluntary
collaboration between EPA and the freight industry (carriers, shippers, logistics
companies, etc.) to improve fuel efficiency and reduce environmental impacts from
freight transport. According to EPA, there are almost 2,900 SmartWay partners that
employ about 650,000 trucks.
There is an incentive for carriers to obtain and maintain
high scores. Carrier performance scores are listed on
EPA's SmartWay website. The carriers that receive
the highest scores are more likely to be selected by
shippers. As more shippers join SmartWay, the
economic incentives for carriers to achieve higher
scores on EPA's website may increase, which could
also increase the potential that a carrier would submit
data that overstate its scores. In our view, the
SmartWay Transport Partnership program may lose
its value if EPA does not protect the integrity of its
program by implementing some form of direct
verification or other measures to deter companies
from submitting data that result in overstated scores.
An example of an EPA-certified
SmartWay tractor. (EPA photo)
We recommended that EPA develop and implement direct verification or other measures
to verify the accuracy of a sample of the self-reported industry data for the SmartWay
Transport Partnership. EPA agreed with the OIG on the importance of ensuring the
integrity of program results and proposed a five-step process to better ensure the accuracy
of partner data.
(Report No. 12-P-0747, EPA Could Improve the SmartWay Transport Partnership
Program by Implementing a Direct Data Verification Process, August 30, 2012)
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Semiannual Report to Congress April 1, 2012—September 30, 2012
EPA's Review of Applications for Research Grant Did Not Follow All
Procedures and Lacked Transparency
EPA's National Center for Environmental Research did not follow all applicable
policies and procedures in reviewing applications submitted under a water
research grant, and did not communicate with grant applicants in a transparent,
appropriate, accurate, and timely manner.
Based on a request from EPA's Assistant Administrator for Research and Development,
which stemmed from concerns raised by a grant applicant, we examined EPA's review
process for "Science to Achieve Results" grant Request for Applications EPA-G2009-
STAR-F1, "Advancing Public Health Protection through Water Infrastructure
Sustainability." For this request, EPA had voided the results of a December 2009 peer
review panel due to concerns over expertise and innovativeness, and completed a second
peer review in June 2010.
We found that the National Center for Environmental Research did not follow the review
process required by the Code of Federal Regulations. Also, although EPA subsequently
issued a class exception, it did not make this known to the public. Also, for more than
half of the 72 applications reviewed during each peer review, at least 1 of the 3 assigned
peer reviewers did not provide written comments addressing each evaluation criterion as
required. Further, the National Center for Environmental Research did not have a clearly
defined "firewall" policy for its peer review process. The process used to select reviewers
for the June 2010 review, in our view, was inconsistent with descriptions of the National
Center for Environmental Research's firewall practice published in prior National
Academies reports. The issues noted stemmed from a lack of program procedures and
management controls, resulting in delays and additional costs for EPA.
The National Center for Environmental Research was not transparent in communicating
its decision to conduct a second review. Declination letters did not sufficiently explain
why applicants were not selected or note the option to request a debriefing. Such
ineffective communications with grant applicants can potentially damage the reputation
of the Science to Achieve Results grant program.
We recommended that EPA ensure that the National Center for Environmental Research
makes the public aware of its class exception from the Code of Federal Regulations and
establishes and adheres to improved procedures and management controls for its firewall
and communication with applicants. EPA agreed with the intent of our recommendations.
(Report No. 12-P-0864, EPA's Review of Applications for a Water Research Grant Did
Not Follow All Review Procedures and Lacked Transparency, September 25, 2012)
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Semiannual Report to Congress April 1, 2012—September 30, 2012
Limited Public Comment Obtained on EPA's Regulatory Flexibility
Act Reviews
An essential aspect of Regulatory Flexibility Act Section 610 reviews is obtaining
public comment on the impact of regulations, but we found that EPA receives
little to no public comment when Section 610 review notices are published in the
Federal Register.
Under Section 610, agencies are required to review rules which have or will have a
significant economic impact on a substantial number of small entities anytime within
10 years of promulgation, to determine whether such regulations should be continued as
written or should be amended or rescinded.
EPA's ability to conduct effective retrospective reviews is dependent on feedback
from the public and the regulated community. We found that the shortage of
comments may be the result of the following reasons:
• If small business concerns are identified, the Agency is mandated to address
these during the initial rulemaking process, which could result in concerns being
addressed at the outset.
• EPA is required by a number of other statutes to conduct retrospective reviews
so the Agency may have already reviewed and modified regulations before the
10-year mark.
• Waiting 10 years after a rule is finalized may not be the optimal time to seek
feedback; some rules may benefit from a review closer to issuance.
• Some of the stakeholders in the regulated community that we contacted were
unaware of the purpose or execution of the Section 610 reviews.
We recommended that EPA coordinate the Section 610 reviews with other required
retrospective reviews, and implement additional public outreach efforts to increase
awareness of the Section 610 purpose and process. The Agency indicated that it is
committed to coordinating Section 610 reviews with other required reviews when
appropriate, and it agreed to implement additional public outreach.
(Report No. 12-P-0579, Limited Public Comment on EPA 's Regulatory Flexibility Act
Section 610 Reviews, July 20, 2012)
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Agency Business Practices and Accountability
EPA Should Improve Controls for Managing Contractor-Held Property
EPA did not have effective oversight of contractor-held property. EPA did not
fully implement corrective actions from an FY 2006 OIG audit report on
contractor-held property, and overstated contractor-held property by $34.6 million
in FY 2010 financial statements.
Accurate contractor-held property records help the Agency safeguard property and report
property in financial statements. However, we found that EPA does not have effective
oversight of contractor-held property and did not fully implement actions from the
FY 2006 report. EPA overstated contractor-held property by $34.6 million in its FY 2010
financial statements because the property was listed in the wrong funding appropriation.
We recommended that EPA quantify the universe of contractor-held property and assign
more resources to the property administration function. We also recommended that EPA
designate contactor-held property as a significant deficiency, develop and implement
policies and procedures for property staff as well as internal controls for financial staff,
and train property staff and contracting officers on current and new responsibilities over
contracts with government property. In addition, we recommended that EPA revise or
update the corrective action plan for the 2006 audit report. EPA agreed with the
recommendations and proposed acceptable corrective action plans to address them.
(Report No. 12-P-0388, EPA Should Improve Controls for Managing Contractor-Held
Property, April 3, 2012)
EPA Could Recover More Indirect Costs Under Reimbursable
Interagency Agreements
EPA did not recover $11 million in indirect costs on reimbursable interagency
agreements through which EPA had provided goods or services to another
agency and was to be reimbursed for its expenses.
Federal entities are required to recognize the full cost of goods and services provided
among federal entities (full cost includes both direct and indirect costs). For 54 of 59
reimbursable interagency agreements reviewed, EPA did not bill other federal agencies
the full amount of indirect costs. This occurred because EPA interpreted policies as
excluding indirect costs and exempted itself from recovering indirect costs under
19 statutory authorities, did not include indirect costs on awards prior to implementation
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Semiannual Report to Congress April 1, 2012—September 30, 2012
of the policy, and did not use current indirect cost rates. Also, calculating and billing
errors occurred.
We estimated that EPA could have recovered $11 million in indirect costs based on rates
for FYs 2010 and 2011. Based on amounts remaining in open agreements, we calculated
that an additional $2.5 million could be billed during the remaining project periods. The
additional indirect costs recovered could be used to pay for other environmental
activities. We recommended that EPA revise its policies, and correct about $584,000 in
billing errors noted. EPA agreed, and has begun updating its policies and correcting
billing errors.
(Report No. 12-P-0835, EPA Could Recover More Indirect Costs Under Reimbursable
Interagency Agreements, September 19, 2012)
Costs Claimed by a North Carolina Grant Recipient Questioned
The North Carolina Rural Economic Development Center, Inc., did not comply
with regulatory requirements for a grant. Therefore, EPA should recover
$1,192,500 in questioned costs from the grantee.
EPA Region 4 initially provided the grantee $994,100 to help fund a $1,046,421 project
under Section 104 of the Clean Water Act. The grant was amended, bringing the total
award to $ 1,192,5 00. We found that the grantee did not properly allocate direct costs
between state and federal funding sources. Therefore, EPA should recover $1,192,500 in
costs questioned under the grant. The grantee failed to properly allocate costs because
EPA provided incorrect guidance and monitoring of the grant.
We recommended that EPA disallow all costs paid under the grant and recover
$1,192,500. EPA and the grantee disagreed with our findings and recommendation.
Region 4 provided a corrective action plan indicating that the grantee will submit a
plan outlining full accounting for the allocation of costs between state and federal
funding sources for the project. With the grantee's plan, the region can determine the
reasonableness, allocability, and allowability of costs. We consider the corrective
actions taken to be incomplete because the grantee has not demonstrated it has
properly accounted for the reimbursement of subcontract costs in its accounting and
billing systems.
(Report No. 12-4-0499, Costs Claimed by the North Carolina Rural Economic
Development Center, Inc., Under EPA Grant No. X96418405, May 23, 2012)
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Semiannual Report to Congress April 1, 2012—September 30, 2012
Office of Environmental Information Should Strengthen
Controls Over Mobile Devices
EPA's Office of Environmental Information (OEI) has no organization-wide
standard operating procedures that explain responsibilities for OEI employees
and contractors regarding mobile devices.
OEI provides technology services for EPA including telecommunications. Executive
Order 13589 requires agencies to assess device usage and establish controls on unused or
underutilized equipment or services. The EPA OIG had received a hotline complaint
regarding misuse of mobile devices within OEI.
OEI does not have effective controls for the five areas of concern noted in the hotline
complaint: issuance, disconnection, multiple devices, inappropriate use, and tracking and
recovery. There is no guidance on determining the need for or frequency of mobile
device upgrades. OEI has not established controls to determine when to disconnect
devices. Over a 6-month period, 68 OEI employees had zero usage of their mobile
devices, incurring costs of about $29,360. Additionally, eBusiness, a Web application for
obtaining devices and monitoring usage, does not correctly reflect the number of devices
issued to employees. As a result, EPA may be paying for service on mobile devices when
the devices were not used. We also found that one OEI employee and one contractor
made costly personal international phone calls.
We recommended that OEI implement standard operating procedures to cover all aspects
of issuance, disconnection, multiple devices, inappropriate use, and tracking and
recovery. We also recommended that OEI take appropriate action on unauthorized calls
identified, and that OEI finalize Agency-wide procedures. OEI concurred with the
majority of our recommendations and described planned corrective actions.
(Report No. 12-P-0427, Office of Environmental Information Should Strengthen Controls
Over Mobile Devices, April 25, 2012)
Costs for Preparing Bay Journal Questioned
A cooperative agreements recipient—the Alliance for the Chesapeake Bay,
Inc.—achieved the intended result of producing the Bay Journal, but did not
comply with requirements regarding procurement and financial management.
EPA awarded the recipient five cooperative agreements between August 2005 and July
2010, with atotal approved project cost of $3.6 million, to promote public education,
outreach, and participation in the restoration of the Chesapeake Bay. One of the tasks
under the cooperative agreements was to produce and publish the Bay Journal. An
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
anonymous hotline complaint had expressed concerns associated with the publication of
the Bay Journal.
The recipient did not prepare and document a cost or price analysis, nor evaluate the
performance of its Bay Journal contractor. Also, its federal financial reports were not
supported by its accounting records. We questioned project costs totaling $1,357,035.
The recipient's written policies and procedures do not include necessary guidance to
ensure compliance with the Code of Federal Regulations. When recipients do not
complete the required cost or price analysis, we have no assurance that costs are fair and
reasonable.
We recommended that EPA disallow the total questioned project costs of $1,357,035 and
recover $1,189,864 of federal funds paid under the cooperative agreements. We also
recommended that EPA require the recipient to improve its procurement internal controls
and ensure that future federal financial reports are supported by accounting system data.
We recommended that certain special conditions be included for all active and future
EPA awards to the recipient until the region determines that the recipient has met all
applicable federal financial and procurement requirements. Both EPA and the recipient
disagreed with our recommendations.
(Report No. 12-4-0720, Examination of Costs Claimed Under EPA Cooperative
Agreements CB-97324701 Through CB-97 3 247 05 Awarded to Alliance for the
Chesapeake Bay, Inc., August 22, 2012)
Great Lakes National Program Needs to Improve Internal Controls
Although Great Lakes Legacy Act of 2002 program funding has increased five-
fold in the last 7 years, the program has not established needed internal controls
to ensure effective operations.
EPA's Great Lakes National Program Office performs sediment remediation using
partnerships with nonfederal sponsors to accomplish the work. The nonfederal sponsor is
required to provide a minimum of 35 percent of the effort in cash or in-kind contributions
to the project.
The Great Lakes National Program Office was not
timely in forwarding project agreements to the EPA
finance center, did not track and record actual in-kind
contributions, and did not perform final accounting
timely. Additionally, the office did not always include
exact due dates and amounts for payments in its project
agreements from nonfederal sponsors and did not verify
a nonfederal sponsor's financial capability.
Equipment cleaning sediment at Kinnickinnic River
site, Wisconsin. (EPA photo)
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
We recommended that EPA develop and implement policies and procedures for the Great
Lakes National Program Office that address the establishment of accounts receivable,
recording of in-kind contributions, completion of final accounting, and reviews of the
financial capability of nonfederal sponsors. EPA took action to address our
recommendations or provided an action plan for recommendations.
(Report No. 12-P-0407, Great Lakes National Program Should Improve Internal
Controls to Ensure Effective Legacy Act Operations, April 9, 2012)
Environmental Job Training Program Needs Controls to Prevent
Duplication
EPA effectively established and adhered to competitive criteria for its
Environmental Job Training program. However, we noted that EPA does not
have internal controls to identify and prevent duplication with other EPA job
training programs.
EPA's Environmental Job Training program recruits and teaches individuals from solid
and hazardous waste-impacted communities the skills needed to secure employment in
the environmental field. Recruitment focuses on low-income, minority, unemployed, and
under-employed people. In FY 2011, EPA awarded 22 job-training grants collectively
valued at over $6.5 million.
We found that EPA did not have internal controls to
identify and prevent duplication with other EPA job
training programs. Consequently, there is some risk of
duplication. Other EPA programs that could possibly
duplicate Environmental Job Training activities include
the Superfund Job Training Initiative; Environmental
Justice Small Grant Program; and the Surveys, Studies,
Investigations and Special Purpose Activities Relating to
Environmental Justice grant program.
Students in Richmond, California's, job training
program. (EPA photo)
We recommended that EPA establish internal controls for coordination with other EPA-
funded job training programs to prevent duplication of effort and spending. The Agency
agreed with the recommendation and committed to improve internal controls.
(Report No. 12-P-0843, EnvironmentalJob Training Program Implemented Well, But
Focus Needed on Possible Duplication With Other EPA Programs, September 21, 2012)
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Semiannual Report to Congress April 1, 2012—September 30, 2012
EPA Did Not Properly Migrate General Ledger Balances to Compass
EPA did not properly migrate general ledger balances to the Compass Financial
system from the Integrated Financial Management System.
In October 2011, EPA's Office of the Chief Financial Officer replaced the Integrated
Financial Management System with Compass. All relevant reference and general ledger
data were to be migrated to Compass from the old system.
In a quick reaction review, we found differences in certain FY 2012 beginning balances,
abnormal balances, and Agency adjustments to beginning balances. The errors we found
are indicators of internal control and oversight weaknesses in the migration of balances.
The Agency stated that the differences were due to the mapping for vendor code
information, trading partner designations, and corrections to budget entries. These errors
occurred because EPA did not properly review and populate vendor-type information and
ensure proper oversight of the migration plan. Because of the general ledger account
differences and lack of supporting details, EPA cannot ensure the reliability of the
FY 2012 balances used to generate the financial statements.
We recommended that EPA determine whether the supporting data elements in the
beginning balances of the general ledger account and treasury symbol were properly
migrated to Compass, adjust the accounts with abnormal balances, and correct the general
ledger crosswalk. The Agency stated it has taken corrective actions and will provide
supporting documentation.
(Report No. 12-P-0559, EPA Did Not Properly Migrate General Ledger Balances to
Compass From the Integrated Financial Management System, July 9, 2012)
EPA Data Standards Plan Completed But Additional Steps Needed
Although EPA completed the steps listed in its 2005 corrective action plan to
close out the Agency-level weakness on data standards, the actions taken were
either incomplete or lacked steps to help management determine the overall
effectiveness of the Agency's implementation of data standards.
In FY 2005, EPA recognized data standards as an Agency-level weakness and OEI
developed a corrective action plan to address this weakness. EPA's corrective action plan
was based on completing three concurrent courses of action: (1) communicating with EPA
program offices on the need to implement data standards more fully, (2) tracking program
implementation of data standards, and (3) verifying progress in implementing data
standards. We determined that EPA:
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Semiannual Report to Congress April 1, 2012—September 30, 2012
• Developed a data standards training program, but took no steps to identify who
needed the training or track whether the appropriate personnel took the training.
• Created data standards report cards, but these report cards were inaccurate
because EPA offices did not update the system used to create the report cards.
• Completed two conformance reviews to determine system compliance with the
data standards, but management made no plans to conduct additional reviews.
We made various recommendations to correct the conditions noted, and the Agency
concurred with the recommendations.
(Report No. 12-P-0519, EPA Data Standards Plan Completed But Additional Steps Are
Needed, June 5, 2012)
Technical Network Vulnerability Assessed at Various Locations
The OIG conducted testing at three locations to identify network vulnerabilities.
If not resolved, these vulnerabilities can expose EPA's assets to unauthorized
access and potentially harm the Agency's networks.
This testing, done in conjunction with our annual audit of EPA's information security
program as required by the Federal Information Security Management Act, found
physical security control weaknesses and vulnerabilities on networked resources at the
sites visited. These include the following:
• The Region 1 facility review identified Internet Protocol addresses with
potentially 18 high-risk and 166 medium-risk vulnerabilities. (Report No.
12 P-0518, Results of Technical Network Vulnerability Assessment:
EPA Region 1, June 5, 2012)
• The Region 6 facility review identified Internet Protocol addresses with
potentially 35 critical risk, 217 high-risk, and 878 medium-risk vulnerabilities.
Additionally, our server room assessments revealed a lack of adequate
monitoring of environmental controls and a lack of controls over granting access
to the server room. (Report No. 12-P-0659, Results of Technical Network
Vulnerability Assessment: EPA Region 6, August 10, 2012)
• The review at EPA's National Vehicle and Fuel Emissions Laboratory in
Ann Arbor, Michigan, identified Internet Protocol addresses with potentially
9 critical-risk, 70 high-risk, and 297 medium-risk vulnerabilities.
(Report No. 12-P-0900, Results of Technical Network Vulnerability Assessment:
EPA 's National Vehicle and Fuel Emissions Laboratory, September 27, 2012)
EPA information security personnel acknowledged the existence of the identified
potential security weaknesses and began immediate remediation of the issues.
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Semiannual Report to Congress April 1, 2012—September 30, 2012
Reviews Disclose Need for Improved Computer Room Security
Controls
Two separate reviews of the security posture and in-place environmental controls
of computer rooms at several locations disclosed the need for improved controls.
• Our review at the Radiation and Indoor Environments National Laboratory,
Las Vegas, Nevada, disclosed a number of security and environmental control
deficiencies. These control deficiencies hinder the safeguarding of critical
information technology assets and associated data. We made various
recommendations for remediating the deficiencies, and EPA agreed to take
sufficient corrective actions. (Report No. 12-P-0847, EPA 's Radiation and
Indoor Environments National Laboratory Should Improve Its Computer Room
Security Controls, September 21, 2012)
• Our review at the Ariel Rios building, Washington, DC, and the Potomac Yard
building, Arlington, Virginia, disclosed numerous security and environmental
control deficiencies. These control deficiencies greatly reduce the ability of OEI
to safeguard critical information technology assets and associated data from the
risk of damage and/or loss. We made various recommendations for remediating
the deficiencies. The Agency agreed with some of the recommendations but
questioned others, and those questioned recommendations remain unresolved.
(Report No. 12-P-0879, EPA 's Office of Environmental Information Should
Improve Ariel Rios and Potomac Yard Computer Room Security Controls,
September 26, 2012)
Pesticide Funds Earn Unqualified Opinions
We rendered unqualified, or clean, opinions on the FYs 2011 and 2010 financial
statements for two funds EPA uses to collect fees related to pesticides.
The Pesticide Registration Improvement Act authorized EPA to assess and collect
pesticide registration fees to expedite registering certain pesticides; the fees are deposited
into the Pesticide Registration Fund. In our opinion, the financial statements for the funds
were fairly presented and free of material misstatement. We noted one material weakness
in internal controls. EPA materially understated the payroll and benefits payable and
related payroll expenses included in FY 2011 gross costs. The Agency's practice of
transferring employees and expenses and liabilities from the Pesticide Registration Fund
to the Environmental Programs and Management Fund for cash flow reasons led to the
understatement. The transfer removed the base upon which the leave accrual and benefits
payable amounts are calculated. The FY 2010 accruals for the Pesticide Registration
Fund were $239,000 while the FY 2011 accruals were $8,000. We also noted one
significant deficiency in internal controls. EPA did not record accounts receivable for a
Pesticide Registration Fund fee until the payments were 18 months overdue. The Agency
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Semiannual Report to Congress April 1, 2012—September 30, 2012
agreed with our findings and recommendations and initiated corrective actions.
(Report No. 12-1-0522, Fiscal Years 2011 and 2010 Financial Statements for the
Pesticide Registration Fund, June 6, 2012)
To expedite reregistering older pesticides and assessing them against modern health and
environmental testing standards, Congress authorized EPA to collect fees from pesticide
manufacturers; the fees are deposited into the Pesticides Reregistration and Expedited
Processing Fund. In our opinion, the financial statements for the funds were fairly
presented and free of material misstatement. We noted one material weakness in internal
controls. In FY 2011, EPA materially understated the fund's payroll and benefits payable,
and related payroll expenses included in gross costs. The Agency's practice of transferring
employees and expenses and liabilities from the Pesticides Reregistration and Expedited
Processing Fund to the Environmental Programs and Management Fund for cash flow
reasons led to the understatement. The transfer removed the base upon which the leave
accrual and benefits payable amounts are calculated. As a result, payroll and benefits
payable were materially understated. The FY 2010 accruals for the Pesticides
Reregistration and Expedited Processing Fund were $2,269,000 while the FY 2011
accruals were $17,000. The Agency agreed with our findings and recommendations and
initiated corrective actions. (Report No. 12-1-0521, Fiscal Years 2011 and 2010 Financial
Statements for the Pesticides Reregistration and Expedited Processing Fund, June 6, 2012)
No Misuse of Tribal Clean Water Act Section 106 Funds Found in
EPA Region 8
During a review conducted in response to a hotline compliant, we found that EPA
Region 8 used funds as intended under the Clean Water Act Section 106.
Section 106 authorizes EPA to provide federal assistance to Indian tribes to establish and
implement water pollution control programs. A hotline complaint alleged that Region 8
withheld funds meant for tribal programs, provided funds to the U.S. Geological Survey
that did not benefit tribes, and provided ineffective tribal support by separating decision
making between two offices. We found that Region 8:
• Funded tribal Section 106 programs based on the region's review of tribal work
plans and did not inappropriately withhold funds. Region 8 determined that tribal
work plans did not warrant the level of funds requested and thus did not award all
program funds to the tribes.
• Proved that the funds provided to the U.S. Geological Survey benefitted the
tribes. However, Region 8 does not have an effective method for gaining tribal
approval for special projects/associated program support costs.
• Properly followed Agency guidance by housing regional program managers
separately from the regional grants management office, but there were
opportunities for improvement.
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Semiannual Report to Congress April 1, 2012—September 30, 2012
We recommended that the Office of Water and Region 8 develop additional guidance on
the use of Section 106 tribal grants funds, and that Region 8 evaluate the effectiveness of
its team approach to tribal technical assistance. Both the Office of Water and Region 8
concurred with our recommendations.
(Report No. 12-P-0453, Alleged Misuse of Tribal Clean Water Act Section 106 Funds in
EPA Region 8, May 4, 2012)
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Semiannual Report to Congress April 1, 2012—September 30, 2012
Investigations
Telemarketers for Florida Company Convicted and Sentenced
A number of former telemarketers for a Florida company were sentenced to
home detention and/or supervised release on charges related to their falsely
claiming a relationship between their product and EPA.
An investigation of FBK Products, LLC, and its employees began after numerous
complaints were received that FBK had engaged in a telemarketing scam by claiming a
fraudulent relationship between EPA and their product, Septic Remedy. During sales
calls, the FBK telemarketers falsely associated their product with EPA and/or
governmental actions.
On April 25, 2012, two former telemarketers from FBK were convicted and sentenced in
the U.S. District Court, Southern District of Florida, West Palm Beach Division. Laura
Janey was convicted on one count of making false statements and sentenced to 12 months
of supervised release. Cheryl Stephenson was convicted on two counts of wire fraud and
sentenced to 24 months of supervised release and ordered to pay $626 in restitution.
On September 13, 2012, three additional former FBK employees were convicted and
sentenced. Richard Chiat and Mitchell Friedman, both former managers, were convicted
of conspiracy to commit wire fraud and sentenced to 8 months home detention plus
1 year of supervised release. They were also ordered to pay $5,323 in restitution and a
$100 special assessment. Gregory Weiss, a former general manager/partner, was also
convicted of one count of conspiracy to commit wire fraud and received the same
sentence.
In February 2012, four other former telemarketers from the company—Mary Ann Moore,
Joseph Nouerand, Christopher Lincoln, and Mohamed Plaisir —had each been convicted
and sentenced to 24 months of supervised release.
Woman Sentenced to Prison for Embezzling From Tribal Organization
A South Dakota woman was sentenced to prison for embezzling funds from a
tribal organization.
On May 25, 2012, in the U.S. District Court for the District of South Dakota, Western
Division, Rhonda Azure was sentenced to 12 months and 1 day of imprisonment to be
followed by 3 years of supervised release. She was also ordered to pay $75,000 in
restitution and a $100 assessment to the Victim Assistance Fund. Azure pleaded guilty to
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Semiannual Report to Congress April 1, 2012—September 30, 2012
conspiracy to commit theft in February 2012. Azure, along with three other people.
embezzled funds from the Mni Sose Intertribal Water Rights Coalition, an organization
that received federal assistance from EPA, by cashing Mni Sose checks and keeping the
money for their own use.
This case was investigated by the EPA OIG and the U.S. Department of the Interior.
Man Convicted for Selling Phony Bio-Diesel Fuel Credits
A Perry Hall, Maryland, man was convicted of selling more than $9 million in
phony bio-diesel fuel credits.
On June 25, 2012, after a week-long trial in the U.S. District Court for the District of
Maryland, Northern Division, Rodney Hailey was convicted of selling phony bio-diesel
fuel credits. Hailey's company, Clean Green Fuel, made more than $9 million selling fake
bio-diesel fuel credits to oil companies, brokers, and producers. Hailey used the money to
charter private jets, buy jewelry, and purchase more than a dozen luxury cars.
Companies that make or import gasoline or diesel are required to use a certain amount of
renewable fuel. To meet their mandate, companies can buy credits that represent
renewable fuel that another company has produced. Between March 2009 and December
2010, Hailey sold more than 35 million credits, called renewable identification
numbers—or RINs—representing more than 23 million gallons of fuel. EPA was unable
to verify whether the production plant even existed.
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.
Man Convicted for Wire Fraud
A Spring, Texas, man was sentenced to 3 years probation, including 4 months of
home detention, on one count of wire fraud related to his inappropriately using
funds provided for travel and moving expenses for a position he accepted in the
Commonwealth of the Northern Mariana Islands.
On August 13, 2012, David P. Preston pleaded guilty and was sentenced on one count of
wire fraud in U.S. District Court, Southern District of Texas. In addition to the probation,
he was ordered to pay $28,000 in restitution and a $100 special assessment. In August
2010, Preston applied for a position at the Commonwealth of the Northern Mariana
Islands Commonwealth Utility Corporation, an agency receiving EPA funds. After being
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Semiannual Report to Congress April 1, 2012—September 30, 2012
hired for the position of drinking water/wastewater manager, he requested an advance of
funds for the shipment of his household goods and for the purchase of airline tickets for
his family to relocate to the islands. The utility corporation provided the funds to Preston
for travel and moving expenses, but he converted those funds for personal benefit while
continuing to reside in Texas. Preston had never moved to the Commonwealth or
reported for work.
Woman Sentenced for Theft of Law Enforcement Items
A Chester, Maryland, woman was sentenced to probation in connection with the
disappearance of an EPA special agent's bag and credentials.
On June 6, 2012, Victoria Lynn Tillbery pleaded guilty to one count of theft in District
Court for Queen Anne's County, Maryland. Tillbery was sentenced to 12 months of
probation, ordered to pay a former EPA OIG special agent $1,195 in restitution, and
complete 40 hours of community service.
In March 2012, an EPA OIG special agent mistakenly left his bag behind after leaving a
restaurant. The bag contained the special agent's credentials and badge, a government-
issued credit card and cellular phone, and other items. When the agent returned to retrieve
the bag, Tillbery, a waitress at the restaurant, stated that someone else had taken the bag.
The investigation determined that Tillbery had in fact removed the agent's bag. The
property was not recovered.
OIG Employee Sentenced for Theft of Laptop Computer
On September 19, 2012, an EPA OIG information technology specialist was convicted
for the theft of a government laptop computer. The employee was convicted in U.S.
District Court, District of Maryland, of one count of theft. The employee was sentenced
to 1 year probation, and ordered to perform 50 hours of community service and pay a
$25 special assessment. OIG management plans to take appropriate administrative action.
Upon notification that a new laptop computer was missing from OIG headquarters, OIG
special agents and others used the anti-theft software installed on the computer and other
investigative techniques to determine the stolen laptop was located in a Maryland
residence. The residence, belonging to the OIG information technology specialist, was
searched and numerous computer-related items were seized, including the stolen laptop.
EPA Employee Demoted for Role in Telephone Calling Scheme
In April 2012, an EPA employee was demoted from a GS-12 to a GS-9 pay grade and
reassigned due to involvement in a telephone calling scheme. The scheme involved using
government telephone lines that gave inmates at a prison in Illinois access to EPA
27
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Semiannual Report to Congress April 1, 2012—September 30, 2012
telephone lines in order to make personal telephone calls from prison. The employee
reportedly received compensation for performing this act.
EPA Employee Retires While Under Investigation
In May 2012, an EPA employee retired while under investigation. It was alleged that the
employee committed time and attendance fraud, conducted personal business on
government-issued computer equipment, and violated the Hatch Act. When interviewed,
the employee admitted to conducting personal business on government time.
28
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Semiannual Report to Congress April 1, 2012—September 30, 2012
Other Activities
FY 2012 Management Challenges Presented to Agency
On July 5, 2012, the EPA OIG provided to EPA Administrator Lisa P. Jackson a list of
management challenges confronting EPA. According to the Government Performance
and Results Act Modernization Act of 2010, major management challenges are programs
or management functions that have greater vulnerability to waste, fraud, abuse, and
mismanagement, and a failure to perform well could seriously affect the ability of the
agency of the federal government to achieve its mission or goals. The FY 2012
challenges were based primarily on our audit, evaluation, and investigative work.
Those challenges are:
• Oversight of delegations to states. EPA may authorize states to implement
environmental laws and regulations, and it relies heavily on authorized states to
do so. However, EPA does not abrogate its oversight responsibility and, while
EPA has renewed its attention to oversight of programs delegated to states, more
work remains.
• Safe reuse of contaminated sites. EPA has increasingly emphasized the reuse of
contaminated or once-contaminated properties, but continues to face challenges
in this area. EPA needs new strategies that take the Agency beyond merely
encouraging accountable parties to fulfill requirements, and focus on providing
the information, resources, and authorities needed.
• Limited capability to respond to cyber security attacks. As technology
continues to advance and EPA increases its automated systems to further
integrate EPA data and services with the Internet, having a strong information
technology infrastructure that addresses security is critical to protecting the
Agency against cyber-attacks.
• EPA's framework for assessing and managing chemical risks. Given the
vast number of chemicals for which EPA needs to perform risk assessments and
management, we continue to identify challenges to EPA's ability to manage
chemical risks.
• Workforce planning. EPA has not developed sufficient analytical methods,
nor does it collect the data needed, to sufficiently measure its workload and the
corresponding workforce levels needed to carry out that workload.
29
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Semiannual Report to Congress April 1, 2012—September 30, 2012
OIG Reviews Its Own Policies and Procedures, as Well as
Independent Referencing
On June 4, 2012, the EPA OIG issued Report No. 12-N-0516, Analysis of Office of
Inspector General Policies and Procedures Addressing the CIGIE Quality Standards.
This review analyzed whether the EPA OIG's policies and procedures complied with the
Council of the Inspectors General on Integrity and Efficiency's (CIGIE's) Quality
Standards for Federal Offices of Inspector General (known as the "Silver Book"), along
with the EPA OIG's own internal standards. The review found that the EPA OIG has
policies and procedures or other guidance to satisfy the Silver Book requirements in all
except one area. The one area involved the lack of guidance on training for the auditors
and evaluators and the responsibility of key managers to ensure their staff members have
the skills necessary to match the OIG's needs. In response, on June 28, 2012, the OIG
issued an Inspector General Statement, Guidelines for Meeting and Recording OIG Staff
Training Requirements in Compliance with Generally Accepted Government Auditing
Standards. The report also noted that 21 of the 28 policies and procedures reviewed were
past the required review date prescribed by the EPA OIG, and the OIG initiated actions to
update the policies and procedures.
On April 19, 2012, the EPA OIG issued Report No. 12-N-0416, Quality Assurance
Report: Assessing the Quality of the Independent Referencing Process During Fiscal
Year 2011. To assess the process, the review surveyed EPA OIG managers regarding
consistency among the OIG's Quality Assurance staff, timeliness of the reviews, best
practices, and areas for improvement. Overall, the majority of the managers who
responded to the survey believed that the independent referencing process was effective
and efficient, and that the referencers were consistent and timely once reviews began.
However, concern was expressed that the wait time for referencing to start once a project
was submitted for referencing was too long. Various areas for improvement were
identified and eight recommendations were issued to improve consistency of reviews and
timeliness. The OIG has initiated actions on these recommendations.
Legislation, Regulations, and Policies 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
Office of Management and Budget 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 CIGIE participation. During the reporting period, we reviewed 65 proposed changes
to legislation, regulations, policy, procedures, and other documents that could affect EPA
and/or the Inspector General, and provided comments on 9. Details on two significant
items follow.
30
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Semiannual Report to Congress April 1, 2012—September 30, 2012
Proposed Update to EPA Manual 2750, Audit Management Procedures. EPA's Office
of the Chief Financial Officer proposed numerous revisions to update EPA Manual 2750,
Audit Management Procedures, which had last been issued in 1998. The revised manual
provides the Agency with a more comprehensive "one stop shop" for audit management
guidance that ensures consistent procedures throughout the audit management and
resolution process. Additionally, the updated guidance refines roles, responsibilities, and
terminology for carrying out the Agency's responsibilities under the Inspector General
Act Amendments of 1988 and Office of Management and Budget Circular A-50. We
provided a number of comments to help strengthen and clarify the manual and more
clearly define the roles, responsibilities, terminology and authorities of both the Agency
and the OIG. One comment included stating that nothing in the manual shall be construed
to conflict with or limit in any way the obligations or the authority of the OIG pursuant to
the Inspector General Act of 1978 as amended, or any other statute, nor the OIG's
exercise of its discretion in carrying out its obligations and authority. The Agency agreed
with the majority of our comments or proposed acceptable alternative language to address
our comments. The revision of EPA Manual 2750 was initiated by an OIG
recommendation for the Office of the Chief Financial Officer to update and revise the
guidance, as well as expedite the resolution process. The obsolete audit resolution process
and the outdated EPA Manual 2750 were included among the Agency Internal Control
Weaknesses reported by the OIG for several years. The revised EPA Manual 2750 was
issued on September 28, 2012.
Proposed Revision to EPA Order 4850, National Security Information, and
Establishment of EPA Manual 4850, National Security Information. EPA's Office of
Administration and Resources Management, Security Management Division, proposed
the establishment of EPA Manual 4850 to formalize the program's policies and
procedures for EPA employees and non-federal personnel who have access to classified
National Security Information; and a revision to EPA Order 4850 to provide more clarity
to roles and responsibilities, and to update the content of the order based upon recently
issued federal guidance. A section of the order and manual provide that the Agency shall
make the determination as to whether:
• EPA personnel requesting Sensitive Compartmented Information access have a
requirement and a valid need to know;
• A program office or region has a valid need for the build-out of a Sensitive
Compartmented Information facility or secure facility; and
• A program office or region has a requirement for installation of the Joint
Worldwide Intelligence Communications System, the Homeland Secure Data
Network, or Secure Video Teleconference Systems.
We raised concerns that these sections encroach upon the Inspector General's
independence. If the Agency is to be the determination office regarding the need for OIG
31
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Semiannual Report to Congress April 1, 2012—September 30, 2012
investigators, auditors, and evaluators to have access to Sensitive Compartmented
Information, that role would conflict with an important provision of the Inspector General
Act. The Agency's determination role may impede the OIG's ability to pursue
investigations, audits, and evaluations and thus may potentially impede the OIG in
carrying out its statutory responsibilities. As of September 30, 2012, we were working
with the Agency to address our concerns.
Small Business Innovative Research Activities Reported to Congress
The OIG is required by Section 5143 of the National Defense Authorization Act of 2012,
(Public Law No. 112-81) to report on reducing vulnerability to fraud, waste, and abuse in
the Small Business Innovative Research program. EPA OIG has worked with EPA's
Small Business Innovative Research program staff to reduce vulnerabilities to fraud,
waste, and abuse. For the period October 1, 2011, to September 1, 2012, EPA did not
refer any cases involving Small Business Innovative Research to the OIG.
32
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Semiannual Report to Congress
April 1, 2012—September 30, 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 available at http://www.csb.gov/service.default.aspx.
CSB Should Improve Its Recommendations Process
CSB did not consistently achieve its goals and standards, as outlined in its
current strategic plan, for timely implementation of its safety recommendations.
CSB issues recommendation reports to government agencies, companies, trade
associations, labor unions, and other groups. The reports contain specific, measurable
safety recommendations designed to prevent future accidents. However, these
recommendations are only suggestions for actions; CSB does not have the authority to
enforce its safety recommendations. In 2004, CSB created the Office of
Recommendations to work with recipients to pursue closure of safety recommendations
by recipients' taking acceptable actions.
As of December 2010, CSB had issued 588 safety recommendations, of which 218
(37 percent) were open while actions were in progress to resolve them. Of the 218 open
recommendations, 54 (nearly 25 percent) were open for more than 5 years. However, as
noted, CSB does not have enforcement authority and implementation of some of its
recommendations may face lengthy regulatory processes. Nonetheless, CSB can establish
better internal controls and processes for safety recommendations to increase the
likelihood that recipients will implement CSB safety recommendations.
We recommended that the CSB Chairperson update board orders that establish policies
for the Recommendation Program, timeliness of board votes, and coordination between
CSB offices. We also recommended that the Chairperson make full use of CSB's Total
Records and Information Management system and implement a formal advocacy
program for safety recommendation implementation. CSB concurred with all our
33
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Semiannual Report to Congress April 1, 2012—September 30, 2012
recommendations except one involving implementing guidelines that define the length
of time notation items can be calendared before a vote must be taken. We consider that
recommendation unresolved but we are working toward a resolution. CSB has redrafted
Board Order 022 to improve the data quality of its recommendation information. CSB
plans to update Board Order 040 to enhance collaboration between investigations and
recommendations personnel.
(Report No. 12-P-0724, U.S. Chemical Safety and Hazard Investigation Board Should
Improve Its Recommendations Process to Further Its Goal of Chemical Accident
Prevention, August 22, 2012)
FY 2012 Management Challenges Presented to CSB
On September 19, 2012, the EPA OIG provided the following two management
challenges to CSB:
• Clarifying CSB's statutory mandate. CSB has an investigative gap between the
number of accidents that it investigates and the number of accidents that fall
under its statutory responsibility to investigate. CSB believes it is operating
according to its statutory mandate and cites a lack of resources to investigate the
additional accidents cited. In a letter dated November 5, 2009, CSB requested
that Congress clarify CSB's statutory mandate as it relates to investigating
chemical accidents. To date, there has been no response from Congress. CSB
needs to follow up with the relevant congressional committees on the status and
resolution of this issue.
• Promulgating a chemical incident reporting regulation. CSB has not
published a chemical incident reporting regulation as envisioned in the Clean Air
Act Amendments. In 2008, the U.S. Government Accountability Office
recommended that CSB publish a regulation requiring facilities to report all
chemical accidents. In 2009, CSB notified the public of a proposed reporting
regulation. Public stakeholder comments to the proposed reporting regulation
indicated it was no longer necessary. The comments stated that Internet search
engines and alerts that notify CSB in almost real time of incidents did not exist
when the requirement for the regulation was established in the 1980s. CSB
should submit a preliminary plan to OMB noting its determination that such a
rule should be repealed to make the organization's regulatory program more
effective, streamlined, and less burdensome in achieving its objectives.
34
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Statistical Data
Profile of Activities and Results
Audit and evaluation operations
Office of Inspector General reviews
($ in millions)
April 1,2012, to
September 30, 2012
Questioned costs * $13.3
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) **
$6.0
$0
$13.0
46
520
FY
2012
$24.9
$378
$0.0
$52.0
71
887
FY
2012
Audit and evaluation operations
Reviews performed by Single Audit Act auditors
($ in millions)
April 1,2012, to
September 30, 2012
Questioned costs * $12.9
Recommended efficiencies *
Costs disallowed to be recovered
Costs disallowed as cost efficiency
Single Audit Act reviews
Agency recoveries
Recoveries from audit and
evaluation resolutions of current
and prior periods (cash collections
or offsets to future payments) ***
$0.0
$0.0
$0
474
$2.7
$15.8
$0.0
$0.0
$0
816
$2.7
Investigative operations
($ in millions)
April 1,201 2, to
September 30, 2012
Total fines and recoveries **** $0.29
Cost savings
Cost avoidances
Civil settlements
Cases open during period
Cases closed during period
Indictments/informations of persons
or firms
Convictions of persons or firms
Civil judgments/settlements/filings
$0
$0
$0
94
88
13
11
0
FY
2012
$3.99
$0
$0
$0.2
168
125
31
18
1
Questioned costs and recommended efficiencies are
subject to change pending further review in the audit
resolution process.
Reports resolved are subject to change pending
further review.
Information on recoveries from audit resolutions is
provided by EPA's Office of Financial Management
and is unaudited.
Fines and recoveries resulting from joint
investigations.
35
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Audit, Inspection, and Evaluation Report Resolution
Status report on perpetual inventory of reports in resolution process
for semiannual period ending September 30, 2012
Report category
A. For which no management
decision was made by
April 1,2012*
B. Which were issued during the
reporting period
C. Which were issued during the
reporting period that required
no resolution
Subtotals (A + B - C)
D. For which a management
decision was made during the
reporting period
E. For which no management
decision was made by
September 30, 2012
F. Reports for which no
management decision was
made within 6 months of
issuance
No. of
reports
122
505
375
252
472
159
69
Report issuance
($ in thousands)
Questioned
costs
$24,738
$26,279
$0
$51,017
$8,051
$42,966
$14,019
Recommended
efficiencies
$0
$3,839
$0
$3,839
$13,701
$0
$0
Report resolution costs
sustained
($ in thousands)
To be
recovered
$1,220
$96
$0
$1,316
$1,145
$0
$0
As
efficiencies
$0
$2,546
$0
$2,546
$13,022
$0
$0
Any difference in number of reports and amounts of questioned costs or recommended efficiencies between this
report and our previous semiannual report results from corrections made to data in our audit tracking system.
Status of management decisions on OIG reports
This section presents additional statistical information that is required by the Inspector General Act of
1978, as amended, on the status of EPA management decisions on reports issued by the OIG involving
monetary recommendations. Tables 1 and 2 cannot be used to assess results of reviews performed or
controlled by the OIG. Many of the reports were prepared by other federal auditors or independent public
accountants. EPA OIG staff do not manage or control such assignments. Auditees frequently provide
additional documentation to support the allowability of such costs subsequent to report issuance.
36
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Table 1: Inspector general-issued reports with questioned costs for semiannual period ending
September 30, 2012 ($ in thousands)
Report category
A. For which no management decision was made by
April 1,2012**
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
September 30, 2012
Reports for which no management decision was made
within 6 months of issuance
No. of
reports
26
19
45
21
21
0
23
4
Questioned
costs *
$24,738
$26,279
$51,017
$8,051
$1,316
$6,418
$42,966
$14,958
Unsupported
costs
$21,444
$14,325
$35,769
$5,004
$2,729
$2,275
$30,445
$14,788
Questioned costs include unsupported costs.
Any difference in number of reports and amounts of questioned costs between this report and our previous
semiannual report results from corrections made to data in our audit, inspection, and evaluation tracking system.
Table 2: Inspector general-issued reports with recommendations that funds be put to better use
for semiannual period ending September 30, 2012 ($ in thousands)
Report Category
A. For which no management decision was made by April 1, 2012 *
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 September 30, 2012
Reports for which no management decision was made
within 6 months of issuance
No. of
reports
0
5
5
0
0
0
0
0
0
Dollar
value
$0
$6,079
$6,079
$0
$0
$0
$0
$0
$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 September 30, 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
38
11
0
21
2
72
Percentage
53
15
0
29
3
100
37
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Semiannual Report to Congress
April 1, 2012—September 30, 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 and for the annual period ending
September 30, 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
Issues referred to others
OIG offices
EPA program offices
Other federal agencies
State/local agencies
Semiannual period
(April 1,2012 -
September 30, 2012)
100
114
102
112
80
25
6
3
Annual period
(October 1,2011 -
September 30, 2012)
118
225
231
112
148
60
7
10
38
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Summary of Investigative Results
Summary of investigative activity during reporting period
Cases open as of April 1, 2012
Cases opened during period
Cases closed during period
Cases pending as of September 30, 2012
248
94
88
254
Investigations pending by type as of September 30, 2012
Contract fraud
Assistance
agreement fraud
Employee integrity
Program integrity
Computer crimes
Threat
Retaliation
Other
Total
Superfund
6
1
4
2
0
0
0
4
17
Management
11
22
37
12
5
1
0
10
98
Split
funded
8
10
34
7
17
3
1
10
90
Recovery
Act
16
21
0
7
0
0
0
4
48
Chemical
Safety Board
0
0
1
0
0
0
0
0
1
Total
41
54
76
28
22
4
1
28
254
Results of prosecutive actions
Criminal indictments/informations/complaints
Convictions
Civil judgments/settlements/filings
Deportations
Fines and recoveries (including civil)
Prison time
Prison time suspended
Home detention
Probation
Community service
EPA OIG only
11
8
0
1
$19,070
24 months
24 months
18 months
156 months
90 hours
Joint*
2
3
0
0
$103,200
12 months
0 months
4 months
72 months
0 hours
Total
13
11
0
1
$122,270
36 months
24 months
22 months
228 months
90 hours
'' With another federal agency.
Administrative actions
Suspensions
Debarments
Other administrative actions
Total
Administrative recoveries
Cost avoidance
EPA OIG only
3
3
30
36
$169,574
$0
Joint*
0
12
2
14
$0
$0
Total
3
15
32
50
$169,574
$0
* With another federal agency.
39
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Appendices
The Inspector General Act of 1978, as amended (IG Act), 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 IG 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
Federal
Report no.
Report title
Date
Ineligible
costs
Unsupported Unreasonable recommended
costs costs efficiencies
PERFORMANCE REPORTS
12-P-0388 EPA Should Improve Controls for Managing Contractor-Held Property Apr. 03 2012
12-P-0407 Great Lakes National Program Should Improve Controls for Legacy Act Operations Apr. 10, 2012
12-P-0417 Weaknesses in EPAs Management of Radiation Network System Demand Attention Apr. 19,2012
12-P-0427 Office of Environmental Information Should Strengthen Controls Over Mobile Devices Apr. 25, 2012
12-P-0453 Hotline-Use of Tribal 106 Funds May 04, 2012
12-P-0508 EPA Inaction in Identifying Hazardous Waste Pharmaceuticals May Impact Disposal May 25, 2012
12-P-0518 Results of Technical Network Vulnerability Assessment: EPA's Region 1 Jun. 05, 2012
12-P-0519 EPA Data Standards Plan Completed but Additional Steps Are Needed Jun. 05, 2012
12-P-0543 EPA's National Security Information Program Could Be Improved Jun. 18, 2012
12-P-0559 EPA Did Not Properly Migrate General Ledger Balances to Compass Jul. 09, 2012
12-P-0579 Limited Public Comment on EPA's Regulatory Flexibility Act Section 610 Reviews Jul. 19, 2012
12-P-0600 Hotline Complaint on Cost and Benefit Estimates for EPA's Lead-Based Paint Rule Jul. 25, 2012
12-P-0659 Results of Technical Network Vulnerability Assessment: EPA's Region 6 Aug. 10,2012
12-P-0747 EPA Could Improve SmartWay Transport Partnership Program Data Verification Aug. 30, 2012
12-P-0835 Indirect Costs on Interagency Agreements Sep. 19, 2012
12-P-0836 EPA Should Improve Controls for Network Directory Service System and Servers Sep. 20, 2012
12-P-0843 Job Training Program Implemented Well, But Focus Possible Duplication Needed Sep. 21, 2012
12-P-0847 Radiation and Indoor Environments National Lab Computer Room Security Controls Sep. 21, 2012
12-P-0864 EPA's Review of Applications for Water Research Grant Did Not Follow All Procedures Sep. 25, 2012
12-P-0879 Ariel Rios and Potomac Yard Computer Room Security Controls Sep. 26, 2012
12-P-0899 Improvements Needed in EPA's Network Security Monitoring Program Sep. 27, 2012
12-P-0900 Vulnerability Assessment of EPA's National Vehicle and Fuel Emissions Laboratory Sep. 27, 2012
TOTAL PERFORMANCE REPORTS = 22
SINGLE AUDIT REPORTS
12-3-0382 Marinette, Wisconsin, City of-FY 2010 Apr. 02, 2012
12-3-0384 Superior, Wisconsin, City of-FY 2010 Apr. 02,2012
12-3-0385 Two Rivers, Wisconsin, City of-FY 2010 Apr. 02, 2012
12-3-0386 Whitehall, Wisconsin, City of-FY 2010 Apr. 02,2012
12-3-0389 Owatonna, Minnesota, City of-FY 2010 Apr. 03, 2012
12-3-0390 New Prague, Minnesota, City of- FY 2010 Apr. 03, 2012
12-3-0391 Moose Lake, Minnesota, City of- FY 2010 Apr. 03, 2012
12-3-0392 Minneota, Minnesota, City of-FY 2010 Apr. 03, 2012
12-3-0393 Medford, Minnesota, City of-FY 2010 Apr. 03, 2012
12-3-0394 Western Michigan Strategic Alliance, Michigan - FY 2009 Apr. 03, 2012
12-3-0395 Salem, New Jersey, City of - FY 2010 Apr. 03, 2012
12-3-0396 Newcomb, New York, Town of-FY 2010 Apr. 03, 2012
12-3-0397 Sublette County School District No. 9, Wyoming Apr. 04, 2012
12-3-0398 St. Louis Junior College District of Missouri - FY 2011 Apr. 04, 2012
12-3-0399 Buckeye, Arizona, Town of - FY 2011 Apr. 05, 2012
12-3-0400 Astoria, Oregon, City of - FY 2011 Apr. 05, 2012
12-3-0401 Osceola County, Michigan - FY 2011 Apr. 05, 2012
12-3-0402 Lenoir, North Carolina, City of-FY 2011 Apr. 05, 2012
12-3-0403 Munich, North Dakota, City of-FY 2010 Apr. 06, 2012
12-3-0404 Northwood, North Dakota, City of - FY 2010 Apr. 06, 2012
12-3-0405 Custer Health Organization, North Dakota - FY 2010 Apr. 06, 2012
12-3-0406 Rhinelander, Wisconsin, City of-FY 2010 Apr. 06, 2012
12-3-0418 Jette Meadows Water and Sewer District Montana - FY 2010 Apr. 24, 2012
12-3-0419 Lavale Sanitary Commission, Maryland - FY 2011 Apr. 24, 2012
12-3-0420 Pennsboro, West Virginia, City of-FY 2011 Apr. 24, 2012
12-3-0421 Prentiss County, Mississippi - FY 2009 Apr. 24, 2012
12-3-0422 Crossville, Tennessee, City of-FY 2011 Apr. 24, 2012
12-3-0423 Putnam Public Service District-Wastewater Fund, West Virginia - FY 2011 Apr. 24, 2012
12-3-0424 Putnam Public Service District-Water Fund, West Virginia - FY 2011 Apr. 24, 2012
12-3-0425 Smyth, Virginia, County of - FY 2011 Apr. 24, 2012
12-3-0426 Waushara County, Wisconsin - FY 2010 Apr. 24, 2012
12-3-0428 Allegan, Michigan, City of - FY 2011 Apr. 25, 2012
12-3-0429 Star Valley Ranch, Wyoming-FY 2011 Apr.26,2012
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
29,360
0
0
0
0
0
0
0
0
0
0
3,108,000
0
0
0
0
0
0
0
$3,137,360
40
-------
Semiannual Report to Congress
April 1, 2012—September 30, 2012
Questioned Costs
Federal
Report no.
12-3-0430
12-3-0431
12-3-0432
12-3-0433
12-3-0435
12-3-0436
12-3-0437
12-3-0438
12-3-0439
12-3-0440
12-3-0441
12-3-0442
12-3-0443
12-3-0444
12-3-0445
12-3-0446
12-3-0447
12-3-0448
12-3-0449
12-3-0450
12-3-0451
12-3-0452
12-3-0454
12-3-0455
12-3-0456
12-3-0457
12-3-0458
12-3-0459
12-3-0460
12-3-0461
12-3-0462
12-3-0463
12-3-0464
12-3-0465
12-3-0466
12-3-0467
12-3-0468
12-3-0469
12-3-0470
12-3-0471
12-3-0472
12-3-0473
12-3-0474
12-3-0475
12-3-0476
12-3-0477
12-3-0478
12-3-0479
12-3-0480
12-3-0481
12-3-0482
12-3-0483
12-3-0484
12-3-0485
12-3-0486
12-3-0487
12-3-0488
12-3-0489
12-3-0491
12-3-0492
12-3-0493
12-3-0494
12-3-0495
12-3-0496
12-3-0497
12-3-0498
12-3-0500
12-3-0501
12-3-0502
12-3-0503
12-3-0504
12-3-0505
12-3-0506
12-3-0507
12-3-0509
Report title
Dillingham, Alaska, City of- FY 2011
Madison School District, Michigan - FY 201 1
Lawton, Michigan, Village of - FY 201 1
Mitchell County, North Carolina - FY 201 1
Lancaster, New Hampshire, Town of - FY 2009
Andrews, North Carolina, Town of - FY 201 1
Tilton Northfield Water District, New Hampshire - FY 201 1
R&T Water Supply, North Dakota - FY 2010
Lower Big Blue Natural Resources District, Nebraska - FY 201 1
Henderson County .Tennessee - FY2011
McMinnville, Tennessee, City of - FY 201 1
Frederick County, Maryland - FY 201 1
Bluefield Sanitary District, West Virginia - FY 201 1
New Jersey, State of - FY 20 11
Pennsylvania, Commonwealth of - FY 201 1
Montour County, Pennsylvania - FY 2010
Independence-Cross Creek Joint Sewer Authority, Pennsylvania - FY 201 0
Foxburg Area Water & Sewer Authority, Pennsylvania - FY 2010
Ironton, Ohio, City of - FY 2010
Lester Prairie, Minnesota, City of - FY 201 1
Murray City, Ohio, Village of - FY 2010
Pittsfield, Illinois, City of- FY 2011
Dayton, Ohio, City of - FY 2010
Rhinelander, Wisconsin, City of- FY 2010
Brookneal, Virginia, Town of - FY 201 1
Loyalsock Township, Pennsylvania - FY 2010
Brooke County Public Service District, West Virginia - FY 201 1
Clean Fuels Ohio, Ohio - FY 201 1
Chicago Metropolitan Agency for Planning, Illinois - FY 201 1
Aiken County, South Carolina - FY 201 1
Cape Fear Public Utility Authority, North Carolina - FY 201 1
Carolina Beach, North Carolina, Town of - FY 201 1
Orangeburg, South Carolina, City of - FY 201 1
Robbinsville, North Carolina, Town of - FY2011
Wisconsin Rapids, Wisconsin, City of - FY 2010
Knox County, Tennessee, West Knox Utility District of - FY 201 1
Benton Harbor, Michigan, City of - FY 2010
Butler, Ohio, County of - FY 2010
Buffalo Island Regional Water District, Arkansas - FY 201 1
Gardner Community Water Association Inc., Louisiana- FY2011
Shoshone Joint School District #312, Idaho - FY 201 1
Union Grove, Wisconsin, Village of - FY 2010
Richland, New York, Town of - FY 2009
Brandon, South Dakota, City of - FY 2010
Ocean Shore, Washington, City of - FY 2010
Eagle Nest, New Mexico, Village - FY 201 1
Elephant Butte, New Mexico, City of - FY 201 1
Hammond, Louisiana, City of - FY 201 1
Oakdale, Louisiana, City of - FY 2011
Ville Platte, Louisiana, City of - FY 201 1
Youngsville, Louisiana, City of - FY 201 1
Ulen, Minnesota, City of - FY 201 1
Port Byron, Illinois, Village of- FY 2011
Tulsa, Oklahoma City, of- FY 2011
Pinedale, Wyoming, Town of - FY 201 0
Orono-Veazie Water District, Maine - FY 2010
Southern Maine Regional Planning Commission, Maine - FY 201 1
New Hampshire, State of- FY 2011
New Berlin Municipal Authority, Pennsylvania - FY 2010
Greene, North Carolina, County of - FY 2011
High Point, North Carolina, City of - FY 201 1
Montgomery, Pennsylvania, Redevelopment Authority of the County of- FY2010
Florida, State of- FY 2011
Tennessee, State of- FY 2011
Zuni, New Mexico, Pueblo - FY2010
North Carolina, State of- FY 2011
Madison Lake, Minnesota, City of - FY 2010
Norwich Township, Pennsylvania - FY2010
Charles City, Iowa, City of - FY 201 1
Granville, New York, Village of - FY 2010
Claywood Park Public Service District, West Virginia - FY 201 1
Beckley, West Virginia, City of - FY 201 1
Enid, Oklahoma, City of- FY 2010
Lower Platte North Natural Resources District, Nebraska - FY 201 1
Hinsdale, New Hampshire, City of - FY 2010
Date
Apr. 26, 2012
Apr. 26, 2012
Apr. 26, 2012
Apr. 26, 2012
Apr. 30, 2012
Apr. 30, 2012
Apr. 30, 2012
Apr. 30, 2012
Apr. 30, 2012
Apr. 30, 2012
Apr. 30, 2012
May 02, 2012
May 02, 2012
May 03, 2012
May 03, 2012
May 03, 2012
May 03, 2012
May 03, 2012
May 03, 2012
May 03, 2012
May 03, 2012
May 03, 2012
May 04, 2012
May 04, 2012
May 06, 2012
May 07, 2012
May 09, 2012
May 09, 2012
May 09, 2012
May 14, 2012
May 14, 2012
May 14, 2012
May 14, 2012
May 14, 2012
May 14, 2012
May 16, 2012
May 16, 2012
May 16, 2012
May 17, 2012
May 16, 2012
May 16, 2012
May 16, 2012
May 16, 2012
May 16, 2012
May 16, 2012
May 16, 2012
May 16, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 17, 2012
May 21, 201 2
May 21, 201 2
May 21, 201 2
May 21, 201 2
May 21, 201 2
May 22, 2012
May 22, 2012
May 22, 2012
May 22, 2012
May 23, 2012
May 23, 2012
May 23, 2012
May 23, 2012
May 23, 2012
May 23, 2012
May 24, 2012
May 24, 2012
May 30, 2012
Ineligible
costs
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Unsupported Unreasonable
costs costs
0 0
0 0
0 0
0 0
99,257 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
226,693 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
recommended
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
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
41
-------
Semiannual Report to Congress
April 1, 2012—September 30, 2012
Questioned Costs
Federal
Report no.
12-3-0510
12-3-0511
12-3-0512
12-3-0513
12-3-0514
12-3-0517
12-3-0520
12-3-0523
12-3-0524
12-3-0525
12-3-0526
12-3-0527
12-3-0528
12-3-0529
12-3-0530
12-3-0531
12-3-0532
12-3-0533
12-3-0534
12-3-0535
12-3-0536
12-3-0537
12-3-0538
12-3-0539
12-3-0540
12-3-0541
12-3-0542
12-3-0544
12-3-0545
12-3-0546
12-3-0547
12-3-0549
12-3-0550
12-3-0551
12-3-0552
12-3-0553
12-3-0554
12-3-0555
12-3-0556
12-3-0557
12-3-0558
12-3-0561
12-3-0562
12-3-0563
12-3-0564
12-3-0565
12-3-0566
12-3-0568
12-3-0569
12-3-0570
12-3-0571
12-3-0572
12-3-0573
12-3-0574
12-3-0575
12-3-0576
12-3-0577
12-3-0578
12-3-0580
12-3-0581
12-3-0582
12-3-0583
12-3-0584
12-3-0585
12-3-0586
12-3-0587
12-3-0588
12-3-0589
12-3-0590
12-3-0591
12-3-0592
12-3-0593
12-3-0594
12-3-0595
12-3-0596
Report title
New Castle Conservation District, Delaware - FY 201 1
Southern New Hampshire Planning Commission, New Hampshire - FY 201 1
Windsor, Vermont, Town of - FY 201 1
Allenstown, New Hampshire, Town of - FY 2010
Upper Blackstone Water Pollution Abatement District, Massachusetts - FY 201 1
Bath, West Virginia, Municipality of - FY 201 1
Wilmington, Delaware, City of - FY 201 1
Union Grove, Wisconsin, Village of -FY 2010
Ocean Shores, Washington, City of - FY 2010
Cape Charles, Virginia, Municipal Corporation of - FY 201 1
Bristol, Rhode Island, Town of - FY 201 1
Armstrong Conservation District, Pennsylvania - FY 2010
Harrisburg, Illinois, City of -FY 2011
Ipava, Illinois, Village of- FY 2011
Payson, Illinois, Village of- FY 2011
Saginaw, Michigan, City of - FY 201 1
Millsboro, Delaware, Town of - FY 201 1
Southern Maryland Maryland, College of - FY 2011
Highlands, North Carolina, Town of - FY 201 1
LaBarge, Wyoming, Town of - FY 201 1
Pinedale, Wyoming, Town of - FY 2010
Washakie County School District #1 , Wyoming - FY 201 1
Tuckaseigee Water & Sewer Authority, North Carolina - FY 201 1
Warsaw, North Carolina, Town of - FY 201 1
Ypsilanti, Michigan, City of -FY 2011
Delaware Center for Inland Bays Inc., Delaware - FY 201 1
Marlin, Texas City, of -FY 20 10
White Sulphur Springs, West Virginia, City of - FY 201 1
Lansing, Michigan, City of- FY 2011
Seabrook, New Hampshire, Town of - FY2010
North Providence, Rhode Island, Town of - FY 201 1
Ludlow, Massachusetts, Town of - FY 2010
Jay, Vermont, Town of - FY 201 1
Hardwick, Vermont, Town of - FY 201 1
Rutland Regional Planning Commission, Vermont - FY 201 1
Springfield, Vermont, Town of - FY 201 1
Grantsville, West Virginia, Town of - FY 201 1
Pedro Bay Village Council, Alaska - FY 2010
Marmet, West Virginia, Municipality of - FY 201 1
Pound, Virginia, Town of - FY 201 1
Salem, West Virginia, Municipality of - FY 201 1
Davis, West Virginia, Municipality of - FY 201 1
East Franklin Township, Pennsylvania
Nitro Regional Wastewater Utility, West Virginia
Hinton, West Virginia, Municipality of - FY 201 1
Gratz Borough Municipal Authority, Pennsylvania
Petersburg, West Virginia, Municipality of - FY 201 1
Brattleboro, Vermont, Town of - FY 201 1
Rutland, Vermont, City of- FY 2011
St. Albans, Vermont, City of - FY 201 1
Republic City of Washington - FY 2010
Water Environment Federation and Subsidiary - FY 201 1
Grand Isle Town of Louisiana - FY 201 1
Tulsa University of Oklahoma - FY 201 1
Wardensville, West Virginia, Town of - FY 201 1
Seattle, City of, Washington - FY2010
Machias, Maine, Town of - FY 201 1
Mount Union, Pennsylvania, Borough of - FY 2010
East Providence, Rhode Island, City of - FY 201 1
Grafton City of Illinois -FY 2011
Athabascan, Council of Tribal Governments, Alaska - FY 201 1
Bay-Lake Regional Planning Commission, Wisconsin - FY2011
Children's Hospital of Philadelphia, PA, Foundation and Controlled Affiliates - FY 201 1
Schuylkill River Development Corporation, Pennsylvania - FY2009
Constructors Association of Western Pennsylvania, Pennsylvania - FY2010
Pine Creek Municipal Authority, Pennsylvania - FY 201 1
Broad Top City Water Authority, Pennsylvania - FY 201 0
Walton/Okaloosa/Santa Rosa Regional Utility Authority, Florida - FY 2010
Washington Town of Louisiana - FY 2010
National Center for Manufacturing Sciences and Subsidiaries - FY 201 1
Havre de Grace, Maryland, City of - FY 201 1
Moultrie, Georgia, City of - FY 201 1
Niles, Michigan, City of - FY 2011
Amarillo, Texas, City of - FY 201 1
Morristown, Tennessee, Town of
Date
May 30, 2012
May 30, 2012
May 30, 2012
May 31, 2012
May 31, 2012
Jun. 04, 2012
Jun. 05, 2012
Jun. 06, 2012
Jun. 06, 2012
Jun. 06, 2012
Jun. 06, 2012
Jun. 07, 2012
Jun. 07, 2012
Jun. 07, 2012
Jun. 08, 2012
Jun. 08, 2012
Jun. 08, 2012
Jun. 11,2012
Jun. 12,2012
Jun. 12,2012
Jun. 12,2012
Jun. 12,2012
Jun. 12,2012
Jun. 13,2012
Jun. 13,2012
Jun. 13,2012
Jun. 14,2012
Jun. 18,2012
Jun. 18,2012
Jun. 19,2012
Jun. 19,2012
Jun. 19,2012
Jun. 19,2012
Jun. 19,2012
Jun. 19,2012
Jun. 19,2012
Jun. 22, 2012
Jun. 27, 2012
Jun. 28, 2012
Jun. 28, 2012
Jun. 28, 2012
Jul. 12,2012
Jul. 12,2012
Jul. 12,2012
Jul. 12,2012
Jul. 12,2012
Jul. 12,2012
Jul. 16,2012
Jul. 16,2012
Jul. 16,2012
Jul. 18,2012
Jul. 18,2012
Jul. 18,2012
Jul. 18,2012
Jul. 18,2012
Jul. 18,2012
Jul. 18,2012
Jul. 18, 2012
Jul. 19, 2012
Jul. 19, 2012
Jul. 19, 2012
Jul. 19, 2012
Jul. 20, 2012
Jul. 20, 2012
Jul. 20, 2012
Jul. 20, 2012
Jul. 20, 2012
Jul. 20, 2012
Jul. 20, 2012
Jul. 20, 2012
Jul. 23, 2012
Jul. 23, 2012
Jul. 23, 2012
Jul. 23, 2012
Jul. 24, 2012
Ineligible
costs
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
13,686
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
4,532
0
0
0
0
0
0
0
0
0
0
0
0
0
0
Unsupported Unreasonable
costs costs
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
413,381 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
0 0
recommended
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
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
42
-------
Semiannual Report to Congress
April 1, 2012—September 30, 2012
Questioned Costs
Federal
Report no.
12-3-0597
12-3-0598
12-3-0599
12-3-0602
12-3-0603
12-3-0604
12-3-0605
12-3-0606
12-3-0607
12-3-0608
12-3-0609
12-3-0610
12-3-0611
12-3-0612
12-3-0613
12-3-0614
12-3-0615
12-3-0616
12-3-0617
12-3-0618
12-3-0619
12-3-0620
12-3-0621
12-3-0622
12-3-0623
12-3-0624
12-3-0625
12-3-0626
12-3-0627
12-3-0628
12-3-0629
12-3-0630
12-3-0631
12-3-0632
12-3-0633
12-3-0634
12-3-0635
12-3-0636
12-3-0637
12-3-0638
12-3-0639
12-3-0640
12-3-0641
12-3-0642
12-3-0643
12-3-0644
12-3-0645
12-3-0646
12-3-0647
12-3-0648
12-3-0649
12-3-0650
12-3-0651
12-3-0652
12-3-0653
12-3-0654
12-3-0655
12-3-0656
12-3-0657
12-3-0658
12-3-0660
12-3-0661
12-3-0662
12-3-0663
12-3-0664
12-3-0665
12-3-0666
12-3-0667
12-3-0668
12-3-0669
12-3-0670
12-3-0671
12-3-0672
12-3-0673
Report title
Charleston, Arkansas, City of - FY 201 1
Alvarado, Texas, City of - FY 201 1
Belen, New Mexico, City of - FY 201 1
Richmond, Vermont, Town of - FY 201 1
North Miami Beach, Florida, City of - FY 201 1
Marlborough, Massachusetts, City of - FY 201 1
St. Augustine Beach, Florida, City of - FY 201 1
Hedrick, Iowa, City of- FY 2011
Port Allen, Louisiana, City of - FY 201 1
Cozad, Nebraska, City of- FY 2011
LaPlata, Maryland, Town of - FY 201 1
Warsaw, Kentucky, City of - FY 201 1
Miami-Dade Water and Sewer Department, Florida - FY 201 1
Benton Harbor, Michigan, City of - FY 201 1
New York, State of- FY 2011
Tredyffrin Township, Pennsylvania - FY 2010
Dubuque, Iowa, City of- FY 2011
Idaho, State of- FY 2011
Lehigh County Authority, Pennsylvania - FY 201 1
Mansfield, Louisiana, City of - FY 201 0
Monroe, Louisiana, City of - FY 201 1
Pawnee, Oklahoma, City of - FY 201 1
Shawnee, Oklahoma, City of - FY 2011
Martinville, Louisiana, City of - FY 201 1
Bloomingdale Utility District of Sullivan County, Tennessee - FY 201 1
Windham Regional Commission, Vermont - FY 201 1
Alton, Wyoming, Town of - FY 201 1
Meeteetse, Wyoming, Town of - FY 201 1
Franklin City of LA -FY 20 11
Washtenaw County, Ml - FY 201 1
Yucaipa Valley Water District, CA - FY 201 1
Santee Sioux Nation, NE, Organizational Unit - FY 201 1
South Lyons Township Sanitary District, Illinois- FY2011
Riverton, Wyoming, City of - FY 201 1
Scappoose, Oregon, City of - FY 201 1
Tigard, Oregon, City of - FY 201 1
Chilhowee, Missouri, City of - FY 201 1
Potlatch, Idaho, City of- FY 2010
Taos, New Mexico, Town of - FY 201 1
Rio Rancho, New Mexico, City of - FY 201 1
San Miguel County, New Mexico- FY2011
Opelousas, Louisiana, City of - FY 201 1
Perkins, Oklahoma, City of - FY 20 11
Questa, New Mexico, Village of - FY 201 1
Westlake, Louisiana, City of - FY 201 1
Iron River, Michigan, City of - FY 201 1
Northlake, Illinois, City of- FY 2011
Spring Creek Joint Sewer Authority, Pennsylvania - FY 2010
Winchester, New Hampshire, Town of - FY 201 1
Orbisonia-Rockhill Joint Municipal Authority, Pennsylvania - FY 2010
Pleasantville Borough, Pennsylvania - FY 2010
Williamsport Sanitary Authority, Pennsylvania - FY 201 1
Upper Pottsgrove Township, Pennsylvania- FY 2010
College Park, Georgia, City of - FY 201 1
Gloucester City, New Jersey, City of - FY 201 0
West Milford Municipal Utilities Authority, New Jersey - FY 201 1
Albany County, New York - FY 201 0
Camden, New Jersey, City of - FY 2010
Bridgeport, Nebraska, City of - FY 201 1
Chesapeake Research Consortium Inc., Maryland - FY2011
Grosse Point Woods, Michigan, City of - FY 201 1
Ottawa, Illinois, City of- FY 2011
Three Rivers, Michigan, City of -FY 2011
Northern Mariana Islands, Commonwealth of - FY 2010
Edgewater, Florida, City of - FY 201 1
Plum Borough Municipal Authority, Pennsylvania - FY 2010
Sheridan, Wyoming, City of - FY 201 1
Fremont County, Wyoming - FY 201 1
Wyoming, University of - FY 201 1
Puerto Rico Aqueduct and Sewer Authority - FY 201 1
Richfield Springs, New York, Village of - FY 201 1
Lonsdale, Minnesota, City of - FY 201 1
Litchfield, Minnesota, City of - FY 201 1
Community Action Duluth Inc., Minnesota -FY 2011
Date
Jul. 24, 2012
Jul. 24, 2012
Jul. 24, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 26, 2012
Jul. 27, 2012
Jul. 27, 2012
Jul. 27, 2012
Jul. 27, 2012
Jul. 27, 2012
Jul. 27, 2012
Jul. 30, 2012
Jul. 31,2012
Jul. 31,2012
Jul. 31,2012
Aug. 01,2012
Aug. 01,2012
Aug. 01,2012
Aug. 01,2012
Aug. 03, 2012
Aug. 03, 2012
Aug. 06, 2012
Aug. 06, 2012
Aug. 06, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 08, 2012
Aug. 09, 2012
Aug. 09, 2012
Aug. 09, 2012
Aug. 09, 2012
Aug. 09, 2012
Aug. 09, 2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 10,2012
Aug. 15,2012
Aug. 15,2012
Aug. 15,2012
Ineligible Unsupported Unreasonable
costs costs costs
0 0 0
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
258,247 0 0
000
0 0 0
000
000
0 0 0
0 0 0
0 0 0
0 0 0
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
129,940.0 0 0
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
000
recommended
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
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
43
-------
Semiannual Report to Congress
April 1, 2012—September 30, 2012
Questioned Costs
Federal
Report no.
12-3-0674
12-3-0675
12-3-0676
12-3-0677
12-3-0678
12-3-0679
12-3-0680
12-3-0681
12-3-0682
12-3-0683
12-3-0684
12-3-0685
12-3-0686
12-3-0687
12-3-0688
12-3-0689
12-3-0690
12-3-0691
12-3-0692
12-3-0693
12-3-0694
12-3-0695
12-3-0696
12-3-0697
12-3-0698
12-3-0699
12-3-0700
12-3-0701
12-3-0702
12-3-0703
12-3-0704
12-3-0705
12-3-0706
12-3-0707
12-3-0708
12-3-0709
12-3-0710
12-3-0711
12-3-0712
12-3-0713
12-3-0714
12-3-0715
12-3-0716
12-3-0717
12-3-0718
12-3-0719
12-3-0721
12-3-0722
12-3-0723
12-3-0725
12-3-0726
12-3-0727
12-3-0728
12-3-0729
12-3-0730
12-3-0731
12-3-0732
12-3-0733
12-3-0734
12-3-0735
12-3-0736
12-3-0737
12-3-0738
12-3-0739
12-3-0740
12-3-0741
12-3-0742
12-3-0744
12-3-0745
12-3-0746
12-3-0748
12-3-0750
12-3-0751
12-3-0752
12-3-0753
Report title
Galeton Area School District, Pennsylvania - FY 201 1
Lake Michigan Air Directors Consortium, Illinois - FY2011
Wyoming, State of- FY 2011
Macatawa Area Coordinating Council, Michigan- FY 201 1
New Mexico, Environment Department - FY 201 1
Mercedes, Texas, City of - FY 201 1
Economic Development and Industrial Corporation of Boston, Massachusetts - FY 201 1
Newport, Oregon, Port of - FY 201 1
Onondaga County, New York - FY2010
St. Johns, Arizona, City of - FY 201 1
Ely, Nevada, City of- FY 20 11
Florence, Oregon, City of - FY 201 1
Bogalusa, Louisiana, City of - FY 201 1
Dallas, Texas, City of - FY 2011
Alamo, Texas, City of- FY 2011
Southwest Research Institute Inc., Texas - FY 201 1
Hawaii, Hawaii, County of - FY 201 1
Keokuk, Iowa, City of- FY 2011
Knoxville, Iowa, City of- FY 2011
Cuba, New York, Town of - FY 2010
Erwin, New York, Town of - FY 2010
Colorado, State of- FY 2011
Passaic Valley Sewerage Commissioners, New Jersey - FY 2010
Goodlettsville, Tennessee, City of - FY 201 1
Helen, Georgia, City of- FY 2011
Paintsville, Kentucky, City of - FY 201 1
Sacramento, Kentucky, City of - FY 201 1
Montevallo, Alabama, Waterworks and Sewer Board of the City of - FY 201 1
Spartanburg County, South Carolina - FY 201 1
Caswell Beach, North Carolina, Town of - FY 201 1
Adrian, Missouri, City of - FY 201 1
Ronda, North Carolina, Town of - FY 201 1
Waleska, Georgia, City of - FY 201 1
Holly Springs, North Carolina, Town of - FY 201 1
Watertown School District No. 14-4, South Dakota - FY 201 1
Bliss, Idaho, City of- FY 2011
St. Helens, Oregon, City of - FY 201 1
Millersburg, Oregon, City of - FY 2011
Wickiup Water District, Oregon - FY 2010
Asbury Park, New Jersey, City of - FY 2010
Daniel, Utah, Town of- FY 2011
Encampment, Wyoming, Town of - FY 201 1
Lennox, South Dakota, City of - FY 2010
Pine Haven, Wyoming, Town of - FY 201 1
Ava, Missouri, City of- FY 2011
Wisconsin, State of- FY 2011
Canastota, New York, Village of - FY 201 1
Iberville Parish Waterworks District No. 2, St. Gabriel, Louisiana - FY2011
Bonham, Texas, City of - FY 201 1
Puerto Rico, Environmental Quality Board, Government of -FY 2010
Charleston Sanitary District, Oregon - FY 201 1
Houston, Missouri, City of -FY 2010
Kansas City, Missouri, City of FY 201 1
American Falls, Idaho, City of - FY 20 11
Grace, Idaho, City of- FY 2011
Bayou Descannes Water System Inc., Basile, Lousiana- FY2011
Belmond, Iowa, City of - FY 2011
Leon, Iowa, City of- FY 2011
Onondaga Environmental Institute Inc., New York- FY2010
Stratford, Iowa, City of- FY 2011
Main South Community Development Corporation, Massachusetts - FY2011
Kearney, Nebraska, City of - FY 201 1
Treasure Coast Regional Planning Council, Florida - FY2011
Wise County, Virginia - FY 201 1
Uinta County School District 6, Lyman, Wyoming - FY 201 1
Puerto Rico Water Pollution Control Revolving Fund - FY 201 1
Grass Valley, California, City of - FY 201 1
Sun Valley Public Service District, West Virginia - FY 201 1
Louisiana, State of- FY 2011
Kansas, State of- FY 2011
Delaware, State of- FY 2011
Wayne, Nebraska, City of - FY 201 1
California, State of- FY 2011
Nevada, State of- FY 2011
Washington, State of -FY 2011
Date
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 16, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 17, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 20, 2012
Aug. 21,2012
Aug. 21,2012
Aug. 21,2012
Aug. 21,2012
Aug. 21,2012
Aug. 21,2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 22, 2012
Aug. 23, 2012
Aug. 23, 2012
Aug. 23, 2012
Aug. 23, 2012
Aug. 23, 2012
Aug. 23, 2012
Aug. 23, 2012
Aug. 23, 2012
Aug. 27, 2012
Aug. 27, 2012
Aug. 29, 2012
Aug. 29, 2012
Aug. 29, 2012
Aug. 31,2012
Sep. 04, 2012
Sep. 04, 2012
Sep. 04, 2012
Sep. 04, 2012
Ineligible Unsupported Unreasonable
costs costs costs
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
000
0 0 0
0 0 0
000
000
0 0 0
0 9,208,356 0
000
000
0 0 0
0 0 0
000
0 0 0
0 0 0
000
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
0 67,068 0
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
000
0 0 0
0 0 0
000
0 0 0
0 0 0
0 1,280 0
000
43,600 0 0
0 0 0
000
recommended
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
0
0
0
0
0
0
0
0
0
0
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
-------
Semiannual Report to Congress
April 1, 2012—September 30, 2012
Questioned Costs
Federal
Report no.
12-3-0754
12-3-0755
12-3-0756
12-3-0757
12-3-0758
12-3-0759
12-3-0760
12-3-0761
12-3-0762
12-3-0763
12-3-0764
12-3-0765
12-3-0766
12-3-0767
12-3-0768
12-3-0769
12-3-0770
12-3-0771
12-3-0772
12-3-0773
12-3-0774
12-3-0775
12-3-0776
12-3-0777
12-3-0778
12-3-0779
12-3-0780
12-3-0781
12-3-0782
12-3-0783
12-3-0784
12-3-0785
12-3-0786
12-3-0787
12-3-0788
12-3-0790
12-3-0791
12-3-0792
12-3-0793
12-3-0794
12-3-0795
12-3-0796
12-3-0797
12-3-0798
12-3-0799
12-3-0800
12-3-0801
12-3-0802
12-3-0803
12-3-0804
12-3-0805
12-3-0806
12-3-0807
12-3-0808
12-3-0809
12-3-0810
12-3-0811
12-3-0812
12-3-0813
12-3-0814
12-3-0815
12-3-0816
12-3-0817
12-3-0818
12-3-0819
12-3-0820
12-3-0821
12-3-0822
12-3-0823
12-3-0824
12-3-0825
12-3-0826
12-3-0827
12-3-0828
12-3-0829
12-3-0830
Report title
Texas, State of- FY 2011
Barnesville, Minnesota, City of - FY 201 1
Mecosta County, Michigan - FY 201 1
Howard Lake, Minnesota, City of - FY 201 1
Austin, Texas, City of - FY 2011
Berlin, New Hampshire, City of - FY 201 1
Pilot Grove, Missouri, City of - FY 201 1
Sergreant Bluff, Iowa, City of - FY 201 1
Miles, Montana, City of- FY 2011
Michigan Department of Environmental Quality - FY 2010 and 201 1
Selby, South Dakota, City of - FY 2010
Southeast Water Users District North Dakota -FY 201 1
Shelby, Montana, City of- FY 2011
Boston Redevelopment Authority, Massachusetts - FY 201 1
Sioux Falls, South Dakota, City of - FY 201 1
East Berlin Area Joint Authority, Pennsylvania - FY 201 1
Narragansett, Rhode Island, Town of - FY 201 1
Apaclachicola, Florida, City of - FY 201 1
Louisville, Georgia, City of- FY 2011
Arcadia, Florida, City of - FY 201 1
Graceville, Florida, City of- FY 2011
Indian Township Tribal Government, Maine - FY 201 1
Neosho, Missouri, City of - FY 201 1
South Sioux City, Nebraska, City of - FY 201 1
Newburg, Missouri, City of - FY 201 1
Alexandria, Minnesota, City of - FY 201 1
Hampton Roads Clean Cities Corporation, Virginia - FY 201 1
Hollywood, Florida, City of - FY 201 1
Hennepin County, Minnesota - FY 201 1
Johnsonburg Municipal Authority, Pennsylvania - FY 201 1
Benson, Minnesota, City of - FY 201 1
Darlington, Indiana, Town of - FY 201 1
Tipton, Missouri, City of - FY 201 1
Stuart, Iowa, City of -FY 2011
Lead, South Dakota, City of - FY 201 1
Pittsboro, North Carolina, Town of - FY 201 1
Sharpsville, Pennsylvania, Borough of -FY 20 11
Poison, Montana, City of - FY 2010
Ray, North Dakota, City of - FY 201 1
First Tennessee Development District, Tennessee - FY 201 1
Natchez Water Works, Mississippi - FY 201 1
Lula, Georgia, City of- FY 2011
Butte-Silver Bow Montana City and County - FY 201 1
Baggs, Wyoming, Town of- FY2011
Sunbury, Pennsylvania City of - FY 2010
Prince's Lake Indiana, Town of - FY 201 1
Flushing, Ohio, Village of- FY 2011
Clinton Elementary School District #32, Montana
Metropolitan Sewer Subdistrict, South Carolina - FY 201 1
North Hudson Sewerage Authority, New Jersey - FY 201 1
Lake County, Michigan - FY2011
Pendleton, South Carolina, Town of - FY 201 1
Red Bay, Alabama, City of - FY 201 1
Russellville, Kentucky, City of - FY 201 1
Watauga River Regional Authority of Carter County, Tennessee - FY 201 1
Tioga County Soil and Water Conservation District, New York - FY 201 1
SRC Inc., New York -FY 2011
Augusta, Georgia, City of - FY 201 1
Upper-Lower River Road, County Water and Sewer District, Montana - FY 2012
Sheridan, Montana, Town of - FY 201 1
Superior, Montana, Town of - FY 201 1
Big Bear Lake, California, City of - FY 201 1
Ute Mountain Ute Tribe, Colorado - FY 201 1
Elko County, Nevada - FY 201 1
Santa Cruz County Resources Conservation District, California - FY 201 1
Hermosa Beach, California, City of - FY 201 1
Hughson California, City of - FY 201 1
Lemoore, California, City of - FY 201 1
Titusville, Florida, City of- FY 2011
Brodhead Creek Regional Authority, Pennsylvania - FY 201 1
Canistota, South Dakota, Municipality - FY 2010-201 1
Newell, South Dakota, Municipality of - FY 2010
Partners Health Care System inc. and Affiliates, Massachusetts
Roslyn, South Dakota, Municipality of - FY 2011
Ogden City Corporation, Utah - FY2011
Chicago, Illinois, City of- FY 2011
Date
Sep. 04, 2012
Sep. 05, 2012
Sep. 05, 2012
Sep. 05, 2012
Sep. 05, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 06, 2012
Sep. 07, 2012
Sep. 07, 2012
Sep. 07, 2012
Sep. 07, 2012
Sep. 07, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 10, 2012
Sep. 11,2012
Sep. 11,2012
Sep. 11,2012
Sep. 11,2012
Sep. 12, 2012
Sep. 12, 2012
Sep. 12, 2012
Sep. 12, 2012
Sep. 12, 2012
Sep. 12, 2012
Sep. 12, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 13, 2012
Sep. 14, 2012
Sep. 14, 2012
Sep. 14, 2012
Sep. 14, 2012
Sep. 14, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 17, 2012
Sep. 18, 2012
Sep. 18, 2012
Sep. 18, 2012
Sep. 18, 2012
Sep. 18, 2012
Sep. 18, 2012
Sep. 19, 2012
Ineligible Unsupported Unreasonable
costs costs costs
33,007 2,375,619 0
0 - 0
0 - 0
0 - 0
0 - 0
0 - 0
0 - 0
0 - 0
0 - 0
50 18,937 0
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
000
0 0 0
0 0 0
000
0 0 0
0 0 0
000
recommended
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
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
45
-------
Semiannual Report to Congress
April 1, 2012—September 30, 2012
Questioned Costs
Federal
Report no.
12-3-0831
12-3-0832
12-3-0833
12-3-0834
12-3-0837
12-3-0838
12-3-0839
12-3-0840
12-3-0841
12-3-0842
12-3-0844
12-3-0845
12-3-0846
12-3-0848
12-3-0849
12-3-0850
12-3-0851
12-3-0852
12-3-0853
12-3-0854
12-3-0855
12-3-0856
12-3-0857
12-3-0858
12-3-0859
12-3-0860
12-3-0861
12-3-0862
12-3-0863
12-3-0865
12-3-0866
12-3-0867
12-3-0868
12-3-0869
12-3-0870
12-3-0871
12-3-0872
12-3-0873
12-3-0874
12-3-0875
12-3-0876
12-3-0877
12-3-0878
12-3-0880
12-3-0881
12-3-0882
12-3-0883
12-3-0884
12-3-0885
12-3-0886
12-3-0887
12-3-0888
12-3-0889
12-3-0890
12-3-0891
12-3-0892
12-3-0893
12-3-0894
12-3-0895
12-3-0896
12-3-0897
12-3-0901
12-3-0902
12-3-0903
12-3-0904
12-3-0905
Report title
Maui County, Hawaii -FY 2011
Walton, Indiana, Town of - FY 201 1
Placer County, California -FY 2011
RioDell, California, City of- FY 2011
Allegan, Michigan, County of -FY 2011
Carrabelle, Florida, City of - FY 201 1
BDW Water System Association, North Dakota - FY 201 1
Mosinee, Wisconsin, City of - FY 201 1
Saint Peter, Minnesota, City of - FY 201 1
Nibbing, Minnesota, City of - FY 201 1
Durham, New Hampshire, Town of- FY2011
Payson, Arizona, Town of - FY 201 1
Inland Empire Utilities Agency, California
Ripley, Tennessee, City of - FY 201 1
Central New York Regional Planning and Development Board, New York - FY 201 1
Alliance for the Chesapeake Bay Inc., Maryland - FY 201 1
Woodburn, Oregon, City of - FY 201 1
Elgin, Oregon, City of- FY 2011
Durand, Illinois, Village of- FY 2011
University of California, California - FY 201 1
L'anse, Michigan, City of - FY 201 1
Keokuk, Iowa, City of- FY 2011
Churchill County, Nevada - FY2011
Eastern Municipal Water District, California - FY 201 1
Woodland California, City of - FY 201 1
Commonwealth Utilities Corporation, MP - FY 201 1
Miami, Arizona, Town of -FY 2010
Aurora, South Dakota, City of - FY 2010
Hawaii Department of Health - FY 201 1
Valdosta, Georgia, City of- FY 2011
Tampa, Florida, City of - FY 2011
Pell City, Alabama, City of - FY 201 1
Forsyth County, Georgia - FY 201 1
Cameron, Missouri, City of - FY 201 1
Coachella Valley Water District, California - FY 2010
North Bay Village, Florida, City of -FY 2011
Fargo, North Dakota, City of - FY 201 1
Richmond Hill, Georgia, City of - FY 2011
Duquense, Missouri, City of - FY 201 1
Dixie County, Florida -FY 2011
Boone County Regional Sewer District, Missouri - FY 201 1
Springfield, Missouri, City of -FY 201 1
Bonifay, Florida, City of -FY 2011
Upton, Wyoming, Town of -FY 201 1
Duluth, Minnesota, City of -FY 2011
Madison County Industrial Development and Building Authority, Georgia - FY 201 1
Pinedale, Wyoming, Town of - FY 201 1
Milbank, South Dakota, City of - FY 201 1
Minneapolis, Minnesota, City of- FY2011
Minong, Wisconsin, Village of - FY 201 1
Illinois, State of- FY 2011
Stevens Point, Wisconsin, City of - FY 201 1
Waldo, Wisconsin, Village of - FY 201 1
Iva, South Carolina, Town of - FY 2010
Park County, Wyoming - FY 201 1
Dassel, Minnesota, City of - FY 2009
Jonesboro, Louisiana, Town of - FY 201 1
Nebraska, State of- FY 2011
Council Bluff, Iowa, City of- FY 2011
Ohio, State of- FY 2011
Fort Madison, Iowa- FY 2011
Iowa, State of- FY 2011
Faribault, Minnesota, City of - FY 201 1
Truckee Meadows Water Authority, Nevada - FY 201 1
Angels, California, City of - FY 201 1
West Florida Regional Planning Council, Florida - FY 201 1
TOTAL SINGLE AUDIT REPORTS = 474
Date
Sep. 19, 2012
Sep. 19, 2012
Sep. 19, 2012
Sep. 19, 2012
Sep. 20, 2012
Sep. 20, 2012
Sep. 20, 2012
Sep. 20, 2012
Sep. 20, 2012
Sep. 20, 2012
Sep. 21,2012
Sep. 21,2012
Sep. 21,2012
Sep. 21,2012
Sep. 21,2012
Sep. 21,2012
Sep. 21,2012
Sep. 20, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 24, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 25, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 26, 2012
Sep. 27, 2012
Sep. 27, 2012
Sep. 28, 2012
Sep. 28, 2012
Sep. 28, 2012
Ineligible
costs
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$483,062
Unsupported
costs
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
44,000
0
0
0
0
0
0
0
0
$12,454,591
Unreasonable
costs
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$0
recommended
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
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
0
$0
ATTESTATION REPORTS
12-4-0490
12-4-0499
12-4-0515
12-4-0548
12-4-0720
Costs Proposed by Industrial Economics, Inc., EPA Solicitation No. SOL-HQ-12-00003
Costs Claimed by the North Carolina Rural Economic Center, Inc., Grant No. X96418405
Option Period 2 Cost Proposal, Contract EP-S9-11-01, by SFS Chemical Safety, Inc.,
Option Period 1 Cost Proposal, Contract EP-S9-1 1-01, by SFS Chemical Safety, Inc.,
Costs Claimed, EPA Cooperative Agreements, for Alliance for the Chesapeake Bay, Inc.
TOTAL ATTESTATION REPORTS = 5
May 21, 2012
May 23, 2012
Jun. 4, 2012
Jun.19, 2012
Aug. 22, 2012
$0
1,192,500
0
0
1,187,277
$2,379,777
$0
0
0
0
101,907
$101,907
$0
0
0
0
0
$0
$0
0
327633
374235
0
$701,868
46
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Questioned Costs
Federal
Report no.
Report title
Date
Ineligible
costs
Unsupported
costs
Unreasonable
costs
recommended
efficiencies
AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 REPORTS
12-R-0601 Site Visit at the Gilt Edge Mine Superfund Site, Lawrence County, South Dakota Jul. 25, 2012 $91,263 $0
12-R-0749 Costs Claimed Under Cooperative Agreement Awarded to Cascade Sierra Solutions Sep. 4, 2012 9,000,000 0
12-R-0789 Site Visit of Wastewater Treatment Plant Improvements Project, Nappanee, Indiana Sep. 12, 2012 0 1,769,000
12-R-0898 EPA Can Improve Its Reporting of Dollars Leveraged From Brownfields Program Sep. 27, 2012 0 0
TOTAL AMERICAN RECOVERY AND REINVESTMENT ACT OF 2009 REPORTS = 4 $ 9,091,263 1,769,000
0
0
0
$0
0
0
0
$0
FINANCIAL STATEMENT REPORTS
12-1-0521 FYs 2011 and 2010 Pesticides Reregistration and Expedited Processing Fund
12-1-0522 FYs 2011 and 2010 Pesticide Registration Fund
FINANCIAL STATEMENT REPORTS = 2
Jun. 06, 2012
Jun. 06, 2012
0
$0
0
$0
0
$0
0
$0
NON-AUDIT REPORTS
12-N-0416 Assessing the Quality of the Independent Referencing Process During Fiscal Year 2011 Apr. 19, 2012
12-N-0434 OIG Compendium of Unimplemented Recommendations as of March 31, 2012 Apr. 30, 2012
12-N-0516 Analysis of OIG Policies and Procedures Addressing CIGIE Quality Standards Jun. 04, 2012
TOTAL NON-AUDIT REPORTS = 3
0
0
$0
0
0
$0
0
0
$0
0
0
$0
U.S. CHEMICAL SAFETY AND HAZARD INVESTIGATION BOARD REPORTS
12-P-0724 CSB Should Improve Its Recommendations Process
TOTAL U.S. CHEMICAL SAFETY AND HAZARD INVESTIGATION BOARD
REPORTS = 1
Aug. 22, 2012
$0
$0
$0
$0
TOTAL REPORTS ISSUED = 511
$11,954,102 $14,325,498
$3,839,228
47
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Appendix 2—Reports Issued Without Management Decisions
For Reporting Period Ended September 30, 2012
The Inspector General Act of 1978, 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 September 30, 2012.
Office of the Administrator
Report No. 12-P-0113, EPA Must Improve Oversight of State Enforcement, December 9, 2011
Summary: The OIG found that EPA does not administer a consistent national enforcement program. Despite efforts
by the Office of Enforcement and Compliance Assurance and the EPA regions to improve state enforcement
performance, state enforcement programs frequently do not meet national goals and states do not always take
necessary enforcement actions. The OIG recommended that EPA establish clear national lines of authority for
enforcement that include centralized authority over resources to establish a consistent national enforcement
program. The OIG also recommended that EPA cancel outdated guidance and policies, and consolidate and clarify
remaining enforcement policies, so that state governments and the regulated community have a clear
understanding of national enforcement expectations. In addition, the OIG recommended that EPA establish clear
benchmarks for state performance and a clear policy describing when and how EPA will intervene in states. Finally,
the OIG recommended that EPA establish procedures to move resources to intervene decisively, when appropriate,
under its escalation policy.
Agency Explanation: Resolution for this audit is being handled by the Office of Enforcement and Compliance
Assurance. That office and the OIG met in August 2012 to discuss unresolved corrective actions and are still working
to resolve agreed-upon actions and due dates.
OIG Follow-Up Status: Incomplete response.
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 Pathways Program regulations were finalized and effective
July 10, 2012. EPA has drafted its Pathways Programs Bulletin and submitted it for comments. Completion is
expected by October 31, 2012.
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
48
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Semiannual Report to Congress April 1, 2012—September 30, 2012
candidates, and data quality and recruitment action processes need improvement. OIG recommendations included
making changes to EPA Order 1110.8A5, EPA Reorganization Policy.
Agency Explanation: The Office of Human Resources met with the OIG on September 26, 2012. The Office of Human
Resources proposed a modification to the Reorganization Form to address recommendation 3(2-3). The OIG is
considering the language and will provide feedback to the Office of Human Resources.
OIG Follow-Up Status: Proposed response received in review process.
Report No. 11-P-0722, EPA Should Prepare and Distribute Security Classification Guides, September 29, 2011
Summary: This report evaluated the scope and nature of 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. OIG recommended that the Administrator ensure the preparation, review,
and approval of appropriate security classification guides that conform to the requirements of Executive Order 13526,
Classified National Security Information, and EPA's national security information handbook. We also recommend 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 subject areas. The Office of Administration and Resources Management,
which responded on behalf of the Agency, did not agree with the report's conclusions and the recommendations are
unresolved.
Agency Explanation: This audit is designated by the OIG as "resolution on hold - beyond Agency control." Therefore
an expected resolution date cannot be determined at this time.
OIG Follow-Up Status: Resolution on hold - beyond Agency control.
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: Meetings were held with subject matter experts and local (Research Triangle Park) OIG staff in
April/May 2012 to develop a mutually acceptable approach for closing the remaining two open corrective actions.
The OIG briefed Office of Air Radiation senior staff on June 27, 2012, about proposed revised approach to closing
two open corrective actions; briefed local OIG staff on July 26, 2012. Anticipated completion date is December 31,
2015.
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
49
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Semiannual Report to Congress April 1, 2012—September 30, 2012
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: The program spoke with the OIG recently regarding a new time frame. The program is writing a
new Quality Assurance Project Plan and is reanalyzing the data based on that Quality Assurance Project Plan to
ensure compliance with EPA's quality assurance requirements. The analysis and accompanying memorandum to the
OIG should be completed by their next progress check after September 2012.
OIG Follow-Up Status: Incomplete response.
Office of Grants and Debarment
Report No. 12-3-0007, Cascade Sierra Solutions, Oregon - FY 2010, October 11, 2011
Summary: This review found that internal controls over project /customer file documentation are deficient. It was
difficult for the recipient to timely substantiate evidence of compliance for installation of verified technologies for EPA
and U.S. Department of Energy grants. The review also found that personnel had limited knowledge of generally
accepted accounting principles, specifically as they relate to accounting for financial receivables, loan fees, and
allowance for losses. Due to the internal control findings reported by the single auditor, and the inability of the
recipient's accounting system to ensure that federal costs are allowable under its grants, we questioned $2,767,077
in reported EPA federal expenditures.
Agency Explanation: The OIG suspended and the Office of Grants and Debarment deferred action on this single audit
review so that Cascade Sierra Solutions could respond to OIG draft report OA-FY11-A-0062 on grant 2A-83440701
for the SmartWays project.
OIG Follow-Up Status: Report reactivated - waiting for response.
Report No. 12-4-0224, Examination of Costs Claimed Under Cooperative Agreement X7-83325501 Awarded to
Kathleen S. Hill, January 23, 2012
Summary: We found that the recipient did not have a financial management system that met federal standards. The
recipient did not have adequate controls to ensure that costs claimed were in accordance with Code of Federal
Regulations requirements. The recipient's cash draws did not comply with 40 Part 30 requirements or the terms and
conditions of the cooperative agreement. As a result, we questioned $80,721 of the $726,587 claimed under the
cooperative agreement.
Agency Explanation: The recipient has provided some documentation to support costs. The Office of Grants and
Debarment reviewer is currently evaluating the submitted documents and requested clarification on some issues.
Office of Grants and Debarment hopes to issue a management decision for the audit by November 30, 2012.
OIG Follow-Up Status: No 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 the Defense Contract Audit Agency's (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.
50
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Semiannual Report to Congress April 1, 2012—September 30, 2012
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.
O/G 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.
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. 08-1-0114, 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
51
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Semiannual Report to Congress April 1, 2012—September 30, 2012
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. 08-1-0130, 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.
O/G Follow-Up Status: Resolution pending receipt of additional information.
Report No. 08-1-0131, 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.
Report No. 09-1-0034, 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 Enforcement and Compliance Assurance
Report No. 12-P-0113, EPA Must Improve Oversight of State Enforcement, December9, 2011
Summary: The OIG found that EPA does not administer a consistent national enforcement program. Despite efforts
by the Office of Enforcement and Compliance Assurance and the EPA regions to improve state enforcement
performance, state enforcement programs frequently do not meet national goals and states do not always take
necessary enforcement actions. The OIG recommended that EPA establish clear national lines of authority for
enforcement that include centralized authority over resources to establish a consistent national enforcement
program. The OIG also recommended that EPA cancel outdated guidance and policies, and consolidate and clarify
remaining enforcement policies, so that state governments and the regulated community have a clear
understanding of national enforcement expectations. In addition, the OIG recommended that EPA establish clear
benchmarks for state performance and a clear policy describing when and how EPA will intervene in states. Finally,
the OIG recommended that EPA establish procedures to move resources to intervene decisively, when appropriate,
under its escalation policy.
Agency Explanation: The Office of Enforcement and Compliance Assurance and the OIG met in August 2012 to
discuss unresolved corrective actions and are still to working to resolve agreed-upon actions and due dates.
O/G Follow-Up Status: Incomplete response.
52
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Region 1—Regional Administrator
Report No. 12-3-0056, Indian Township, Maine, Tribal Government- FY2010, November?, 2011
Summary: This review found that the tribe had various funding issues related to EPA grants, including closed grants
with unexpended balances, active grants with variances between funds available and funds to expend, and grants
with over expended funds. The review also found that the tribe did not maintain a comprehensive schedule of general
capital assets with supporting detail. The tribe did not have an adequate segregation of duties over cash
management and their procurement policy did not comply with current regulatory requirements, including provisions
for suspension and debarment.
Agency Explanation: The tribe sent an e-mail on September 19, 2012, stating that it has been working on the new
policies and has requested to be put on the agenda of the tribal council to present the new policies. The tribe indicated
it hopes to present them at the next meeting.
OIG Follow-Up Status: No response.
Region 2—Regional,
Report No. 12-3-0198, Onondaga Environmental Institute New York - FY 2009, January 2012
Summary: This review found that the organization lacks sufficient internal controls over the financial records and the
preparation of the financial statements to prevent or detect errors in the financial data, including those which may be
material in relation to the financial statements. Assets and liabilities, along with related revenue and expense
accounts, were materially misstated and, in some instances, adequate supporting documentation was not available.
The review also found that the organization lacks adequate professional expertise and technical skill to maintain
complete and accurate financial records, along with adequate supporting documentation.
Agency Explanation: The grantee's corrective action plan is not fully satisfactory to Region 2. We continue to have
dialogue with the grantee, and will be reviewing this situation shortly. We expect to close this single audit by March 31,
2013.
O/G Follow-Up Status: No response.
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: Region 4 submitted a memorandum to the OIG updating the corrective actions and supporting
their completion. The OIG's status is "proposed acceptable response - awaiting final determination." The projected
completion is October 30, 2012.
O/G Follow-Up Status: Proposed acceptable response - awaiting final determination.
53
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Semiannual Report to Congress
April 1, 2012—September 30, 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 does not agree with the Agency's final determination - this audit is in dispute.
OIG Follow-Up Status: Resolution under negotiation in headquarters.
Report No. 12-R-0377, American Recovery and Reinvestment Act Site Visit of Wastewater Treatment Plant,
Village of Itasca, Illinois, March 30, 2012
Summary: This review found that the Village of Itasca 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.
Agency Explanation: The OIG does not agree with the Agency's final determination - this audit is in dispute.
OIG Follow-Up Status: Proposed response received in review process.
Report No. 12-3-0322, Great Bend, Kansas, City of- FY 2012, March 8, 2012
Summary: This review found that the City of Great Bend incurred $36,000 in excess contract costs that were not
supported by change orders and approved by the city council. Instead, city engineers approved the contract costs.
In addition, city personnel did not have the necessary skills and expertise needed to record the financial transactions
and prepare the financial statements. Further, city personnel did not have the necessary skills and knowledge to
identify all federal awards received and expended and to prepare the appropriate financial statements required under
Office of Management and Budget Circular A-133.
Agency Explanation: Awaiting additional response from the City of Great Bend. This report should be closed before
the next semiannual reporting period, or by February 28, 2013.
OIG Follow-Up Status: No response.
Report No. 12-3-0346, Linn, Missouri, City of-FY 2011, March 13,2012
Summary: This review found that the city lacked proper segregation of duties, and that personnel lacked expertise to
prepare financial statements.
Agency Explanation: Awaiting additional response from the City of Linn. This report should be closed before the next
semiannual reporting period, or by February 28, 2013.
O/G 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
54
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Semiannual Report to Congress April 1, 2012—September 30, 2012
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: The Region 8 Grants Office has completed an analysis of over $2 million in costs questioned by
the OIG. Region 8 has determined that only $15,000 should have been questioned and so the region submitted a
request for deviation in order to move forward from EPA's Office of Grants and Debarment. Based on the Office of
Grants and Debarment's guidance, the region is working on an alternate approach, which is to retract the decision to
disallow the costs, since the region review indicated that the amount not documented adequately is not material. The
region will need to revise its documentation and work with the OIG to get concurrence on this approach. This process
will not be completed by September 30, 2012. The region plans to engage the OIG in October 2012 and get
resolution within a few months after that.
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: Resolution on hold beyond Agency control.
Total reports issued before reporting period for which
no management decision had been made as of September 30, 2012 = 23
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Appendix 3—Reports With Corrective Action Not Completed
In compliance with reporting requirements of Section 5(a)(3) of the Inspector General Act of 1978, 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/2013/20121031 -13-N-00035.pdf) is produced semiannually for Agency
leadership and Congress based on Agency reports on the status of actions taken on OIG
recommendations and OIG selective verification of that reported status.
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Appendix 4—Peer Reviews Conducted
Peer Review Conducted of This OIG
Report on the External Quality Control Review of the Audit Organization of the
U.S. Environmental Protection Agency, Office of Inspector General
(Report No. A-07-12-01109, issued May 1, 2012)
On May 1, 2012, the U.S. Department of Health and Human Services OIG provided the EPA OIG with the
final peer review report on the EPA OIG's audit organization. The review, covering the period October 1,
2008, through September 30, 2011, was conducted in accordance with CIGIE guidelines and
Government Auditing Standards. The peer review found that the EPA OIG's system of quality control
"was suitably designed and complied with to provide EPA OIG with reasonable assurance of performing
and reporting in conformity with applicable professional standards in all material respects." EPA OIG
received a peer review rating of pass, with no deficiencies cited.
Peer Reviews Conducted by This OIG
On May 9, 2012, the EPA OIG issued a quality assessment review report on the investigative operations
of the U.S. Department of Energy OIG. We reviewed the system of internal safeguards and management
procedures in effect for the period May 1, 2010, through April 30, 2011. Our review was conducted in
conformity with the Quality Standards for Investigations and the Quality Assessment Review Guidelines
established by CIGIE, and the Attorney General's Guidelines for Office of Inspectors General with
Statutory Law Enforcement Authority, as applicable. In our opinion, the system of internal safeguards and
management procedures for the investigative function were in compliance with the established quality
standards and the applicable Attorney General guidelines. These safeguards and procedures provide
reasonable assurance of conforming with professional standards in the planning, executing, and reporting
of investigations.
Also during the semiannual reporting period, the EPA OIG conducted an external peer review of the
system of quality control for the audit organization of the U.S. Department of Agriculture OIG. Our review
covers the period April 1, 2009, through March 31, 2012. This review has been conducted in accordance
with guidelines established by CIGIE and Government Auditing Standards. The entrance conference for
the U.S. Department of Agriculture OIG was held April 5, 2012. Issuance of the final report is anticipated
during the next semiannual reporting period.
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Semiannual Report to Congress
April 1, 2012—September 30, 2012
Appendix 5—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: (703) 347-8740
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
11201 Renner Boulevard
Lenexa, KS66219
Audit/Evaluation: (913) 551-7878
Investigations: (312) 353-2507
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) 814-2367
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) 947-8711
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
Washington
U.S. Environmental Protection Agency
Office of Inspector General
Potomac Yard
2733 Crystal Drive
Arlington, VA 22202
Investigations: (703) 347-8740
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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