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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
16-P-0320
September 21, 2016
Why We Did This Audit
The U.S. Environmental
Protection Agency (EPA)
Region 9 requested assistance
from the Office of Inspector
General (OIG) to address
concerns related to two
questionable cash draws made
under grants awarded to the
Manchester Band of Porno
Indians in California. Region 9
was also concerned that grant
objectives were not being met.
The OIG conducted this audit
to address the region's
concerns and to determine
whether the costs claimed
under the grants were
reasonable, allowable,
allocable and properly
supported, in accordance with
federal regulations and the
grant terms and conditions.
This report addresses the
following EPA goals or
cross-agency strategies:
•	Protecting America's
waters.
•	Cleaning up communities
and advancing sustainable
development.
•	Working to make a visible
difference in communities.
Send all inquiries to our public
affairs office at (202) 566-2391
or visit www.epa.gov/oia.
Listing of OIG reports.
Manchester Band of Pomo Indians Needs to
Improve Its Financial Management System and
Demonstrate Completion of Grant Work
What We Found
The Manchester Band of Pomo Indians'
financial management system did not meet
certain federal standards under the Code of
Federal Regulations (CFR) in 40 CFR § 31.20
(now in 2 CFR § 200.302). Manchester did not
have adequate controls to make sure costs
claimed were allowable under federal cost
principles, allocable to EPA grants, and
adequately supported. Also, Manchester's cash
draw procedures did not comply with federal cash management
requirements, including for the two cash draws questioned by EPA
Region 9. As a result, we questioned $350,721, or 93 percent, of the
$378,679 claimed.
Manchester also could not provide evidence of completion for a significant
portion of tasks specified in its EPA grant work plans. Therefore,
Manchester did not fully meet its grant objectives. As a result, we
questioned all remaining costs, or $27,959, claimed under the grants.
Recommendations
We recommend that the EPA Regional Administrator, Region 9, disallow all
costs claimed, totaling $378,679, and recover the federal share of $372,716,
unless the Manchester Band of Pomo Indians can support that the costs are
allowable and the grant tasks are completed. In addition, we recommend
that the region designate Manchester as a high-risk grantee, in accordance
with federal regulations, and place appropriate special conditions upon any
future awards until Manchester implements sufficient policies and
procedures. We also recommend that the region implement special grant
conditions for future awards that require completion of grant tasks before
payments are made.
Documents summarizing the costs questioned and outlining our audit
findings and recommendations were provided to Manchester and EPA
Region 9 on June 3, 2016, and discussed with EPA officials on June 6,
2016. However, Manchester did not respond to EPA and OIG requests for
discussion of the documents. Consequently the EPA supported the OIG's
decision to issue the final report without Manchester's response.
The Manchester Band
of Pomo Indians'
inadequate financial
management system,
and shortfalls in
completing grant tasks,
resulted in all costs
claimed being
questioned.

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