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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
08-2-0204
July 21, 2008
Catalyst for Improving the Environment
Why We Did This Review
The U.S. Environmental
Protection Agency (EPA)
Office of Inspector General
conducted reviews of
earmarked grants known as
Special Appropriation Act
Projects issued to local and
tribal governments. We
selected the Village of
Wellsville, Ohio, for one of
these reviews.
Background
The Village of Wellsville
received an EPA Special
Appropriation Act Project
grant, XP97582801. The
purpose of the grant was to
provide federal assistance of
$2,419,665 to improve and
upgrade the wastewater
treatment plant and the
combined sewer collection
system. The Village of
Wellsville was required to
provide local matching funds
equal to 45 percent of all
eligible project costs.
Village of Wellsville, Ohio - Ineligible Costs
Claimed Under EPA Grant XP97582801
What We Found
The Village of Wellsville (grantee) did not meet the Title 40 Code of Federal
Regulations Part 31 requirements for financial management. In particular, the
grantee did not have support for required matching costs and received grant funds
it never expended. As a result, EPA will need to recover $1,241,591 under Grant
XP97582801. The grantee also made two improper procurements for engineering
services, and did not maintain acceptable procurement or contract administration
systems. Further, the grantee did not conform to the terms and conditions of its
grant. Therefore, EPA should classify the Village of Wellsville as a high risk
grantee.
What We Recommend
We recommend that the Regional Administrator, EPA Region 5:
1.	Recover the $1,241,591 in questioned costs.
2.	Require the grantee to re-bid both engineering contracts with Dallis Dawson
and Associates in accordance with federal regulations.
3.	Require the grantee to strengthen its accounting and procurement systems to
meet the requirements of Title 40 Code of Federal Regulations Part 31.
4.	Classify the Village of Wellsville as a high risk grantee, and apply special
conditions to this and future awards until improvements are made to the
accounting and procurement systems.
For further information,
contact our Office of
Congressional and Public
Liaison at (202) 566-2391.
To view the full report,
click on the following link:
www.epa.qov/oiq/reports/2008/
20080721-08-2-0204.pdf

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