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Index of Reporting Requirements
Inspector General Act of 1978, as amended
Section 4(a
Review of legislation and regulations
25
Section 5(a
Significant recommendations for corrective action
6-14, 20-21
Section 5(a
Matters referred to prosecutive authorities
15-19, 22, 33, 35-36, 69-77
Section 5(a
List of reports issued
37-40
Section 5(a
Audit, inspection and evaluation reports—questioned costs
2, 5, 33-34, 37-40
Section 5(a
Prior audit, inspection and evaluation reports unresolved
34, 41-68
Section 5(a
Significant management decisions with which OIG disagreed
None
Section 5(a
17-18) Statistics on investigative reports, referrals, prosecutions, indictments
35-36
Section 5(a
20)
Description of whistleblower retaliation
Section 5(a
22)
Closed audits, evaluations and investigations not disclosed to public
69-77
Section 5(a
Any establishment attempts to interfere with independence
Section 5(a
Audit, inspection and evaluation reports—funds to be put to better use
2, 5, 33-34, 37-40
Section 5(a
Significant revised management decisions
None
Section 5(a
14-16) Peer reviews conducted
Section 5(a
Summaries of significant reports
6-14, 20-21
Section 5(a
Reports with corrective action not completed
46-68
Section 5(a
Substantiated Investigations involving senior government employees
69-70
Section 5(a
Significant problems, abuses and deficiencies
6-22
Section 5(a
Information or assistance refused
Requirement
Subject
Pages
Abbreviations
CFR Code of Federal Regulations
CSB U.S. Chemical Safety and Hazard Investigation Board
DATA Act Digital Accountability and Transparency Act of 2014
EPA U.S. Environmental Protection Agency
FY Fiscal Year
DOJ U.S. Department of Justice
OIG Office of Inspector General
OMB Office of Management and Budget
Are you aware of fraud, waste or abuse in an
EPA program?
EPA Inspector General Hotline
1200 Pennsylvania Avenue, NW (2431T)
Washington, DC 20460
(888) 546-8740
(202) 566-2599 (fax)
OIG Hotline@epa.gov
Learn more about our OIG Hotline.
EPA Office of Inspector General
1200 Pennsylvania Avenue, NW (2410T)
Washington, DC 20460
(202) 566-2391
www.epa.gov/oiq
Subscribe to our Email Updates
Follow us on Twitter @EPAoig
Send us your Project Suggestions
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Message to Congress
During the semiannual period, the Office of Inspector General (OIG) issued
various audit and program evaluation reports with recommendations to help the
U.S. Environmental Protection Agency (EPA) improve efficiency in its
operations, as well as better protect people and the environment. We also
conducted numerous investigations that detected fraud, waste and abuse, and
threats against EPA personnel. The OIG s important mission becomes even
more imperative as the agency faces proposed budget cuts. This report
provides synopses of our work, some of which are highlighted below. It also
reflects new requirements established by the Inspector General Empowerment
Act of 2016.
Results Stemming from OIG Work
After the city of Flint, Michigan, switched its drinking water supply in Apnl 2014, inadequate treatment
exposed many of the city' s residents to lead. We found that EPA Region 5 had the authority and sufficient
information to issue a Safe Drinking Water Act Section 1431 emergency order to protect Flint residents as
early as June 2015, but did not do so. EPA Region 5 had concluded that state actions were ajurisdictional
bar preventing it from taking action. Ultimately, in January 2016, EPA headquarters issued an emergency
order. We issued a management alert report recommending that the agency update its guidance on
emergency authority to prevent delays from happening in the future; our evaluation of the Flint drinking
water crisis is ongoing and we expect to issue an additional report.
A congressional inquiry into whether the EPA preserves text messages as federal records prompted an
OIG audit. We did not find instances where the agency used text messages to intentionally circumvent the
Federal Records Act. However, we found that improvements can be made in records management and
Freedom of Information Act practices, such as for documenting actions and providing needed instruction.
In another audit report, we noted a lack of oversight regarding
the Compass Financials database, which houses Personally
Identifiable Information belonging to employees and vendors.
A security breach could cost the EPA as much as $3.5 million,
including expenses to detect, recover, investigate and manage an
incident response.
On the investigations front, the OIG's good work resulted in the
indictment of two men on charges related to a scheme to falsify
water samples during testing of new water lines in an Alabama
community; the samples included tests to determine whether
harmful bacteria were present in the water. In other cases, one
woman was charged with assault for attacking a security officer at
the EPA Region 4 building in Atlanta, Georgia, and another was
issued a bar notice prohibiting access to certain EPA buildings
Arthur A. Elkins Jr.
OIG Accomplishments
During Reporting Period
• More than $7.13 million in questioned
costs and recommended efficiencies.
• More than $3.59 million in monetary
actions taken or resolved prior to
report issuance.
• More than $5.81 million in total fines
and recoveries (including EPA only and
joint investigations).
• 165 reports issued (17 by EPA OIG and
148 by single auditors).
• 69 investigative cases closed.
• 92 administrative actions resulting
from investigative cases.
• 93 hotline inquiries closed.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
because she sent a threatening email to the EPA Administrator. We also uncovered instances of time-and-
attendance fraud.
OIG Mandatory Work
A substantial amount of worked performed by all federal OIGs, including the EPA OIG, is mandatory.
A congressional committee looking into this matter sent a letter to the 72 Inspectors General seeking
feedback "to ensure that OIGs are not bogged down by unnecessary, dated, or duplicative mandatory
reporting requirements," and we provided the committee with suggestions for work that can be eliminated
or reduced. As the government strives to become more efficient and provide taxpayers a better return on
dollars invested, we believe this initiative on the part of the congressional committee will be beneficial.
Indeed, the U.S. Government Accountability Office has just noted in a report (GAO-17-460) that it has
determined that, although mandatory, Digital Accountability and Transparency Act audits conducted by
Inspectors General are of only "limited use" to the Office of Management and Budget and the
U.S. Department of the Treasury—primary consumers of these audits—because the Office of
Management and Budget and the Treasury monitor agency progress "through other means."
New Reporting Requirements
The Inspector General Empowerment Act of 2016 became law in December, establishing new reporting
requirements for Semiannual Reports to Congress that have been implemented in this report. To some
extent, these new requirements codify congressional requests that the OIG community had been fulfilling
through other means. To address the new requirements, we have added the following features:
• A section addressing the status of whistleblower retaliation and interference with OIG
independence.
• A section addressing any audit, inspection and evaluation report issued where no agency
comment was returned within 60 days.
• Details on investigations involving senior government employees.
• A table providing a tally of investigative reports issued and criminal referrals made.
• An appendix on closed audits, evaluations, inspections and investigations not disclosed to the
On the inside front cover of this semiannual report, the last five entries under "Index of Reporting
Requirements" point to where new information is provided. We hope that this semiannual report provides
Congress, the EPA, U.S. Chemical Safety and Hazard Investigation Board, and the public with information
of value.
public.
Arthur A. Elkins Jr.
Inspector General
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Table of C
About EPA and Its Office of Inspector General 1
Scoreboard of Results 2
Furthering EPA's Goals and Strategies 3
Status of Whistleblower Retaliation and Interference With Independence 4
OIG Identifies Funds to Put to Better Use and
Health and Environmental Concerns 5
Significant OIG Activity 6
Congressional Activities 6
Human Health and Environmental Issues 7
Agency Business Practices and Accountability 11
Investigations 15
U.S. Chemical Safety and Hazard Investigation Board 20
Hotline Activities 22
Other Activities 25
Other Results of OIG Work 26
Follow-Up an Important Aspect of OIG Efforts 26
Single Audit Reporting Efforts Make Impact 28
Actions Taken on Reports Result in Improvements 30
Projects Generated by Earlier OIG Work 31
Agency Best Practices Noted 32
Statistical Data 33
Profile of Activities and Results 33
Audit, Inspection and Evaluation Report Resolution 34
Summary of Investigative Results 35
Appendices 37
Appendix 1—Reports Issued 37
Appendix 2—Reports Issued Without Management Decisions or Comment 41
Appendix 3—Reports With Corrective Action Not Completed 46
Appendix 4—Closed Projects Not Publicly Disclosed 69
Appendix 5—Peer Reviews Conducted 78
Appendix 6—OIG Mailing Addresses and Telephone Numbers 79
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
About EPA and Its
Office of Inspector General
U.S. Environmental Protection Agency
The mission of the U.S. Environmental Protection Agency (EPA) is to protect
human health and the environment. As America's steward for the environment since
1970, the 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 Office of Inspector General
EPA OIG Received Highest Rating
in Peer Review
The systems of quality control for the EPA
OIG are peer reviewed by another OIG on a
regular basis to ensure that the EPA OIG
satisfies professional standards. The last
external peer review of the EPA OIG's
audit and evaluation offices was
completed in June 2015, and the last
external peer review of the EPA OIG's
investigations office was completed in
December 2014. Both reviews gave the
EPA OIG the highest rating possible—pass.
Further details are in Appendix 5.
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 the 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, D.C.; at the
EPA's 10 regional offices; and at other EPA locations,
including Research Triangle Park, North Carolina, and
Cincinnati, Ohio. 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:
Vision
Be the best in public service and oversight for a better environment tomorrow.
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 the environment.
2. Contribute to improved EPA and CSB business practices and accountability.
3. Be responsible stewards of taxpayer dollars.
4. Be the best in public service.
1
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Scoreboard of Results
The information below shows the taxpayers" return on investment for the work performed by the EPA
OIG during the first half of fiscal year (FY) 2017 compared to FY 2017 annual performance goal targets.
Annual Performance Goal 1:
Environmental and business outcome actions taken or realized by the EPA (based on OIG recommendations)
Target: 274
Reported: 116
(42% of goal)
Supporting measures
105 Environmental, chemical safety or business policy, practice or process changes
made or decisions implemented
11 Environmental/health improvements realized or influenced by OIG work
0 Legislative or regulatory changes made
Annual Performance Goal 2:
OIG environmental and business output recommendations, awareness briefing or testimony (for agency action)
Target: 1,094
Reported: 426
(39% of goal)
Supporting measures
11 Certifications, verifications, validations (contributions to enhance actions and
public confidence that relates to agency information)
139 Recommendations for improvement (including risk identified)
0 Referrals for agency action
16 Unimplemented recommendations identified
18 Outreach activities with internal/external stakeholders to plan and promote OIG work
242 OIG-identified findings in external reports impacting EPA
Annual Performance Goal 3:
Monetary return on investment - potential monetary return on investment as percentage (220%) of budget
Target: 220% return on
investment
Reported: $16.63 million
(32% of goal)
Supporting measures (dollars in millions)
$0.07 Questioned costs
$7.06 Recommended efficiencies
$3.69 Monetary actions taken or resolved prior to report issuance
$5.43 Fines, penalties, settlements and restitutions resulting from joint investigations
between EPA OIG and other federal entities
$0.00 Cost avoidance savings
$0.38 Fines, penalties, settlements and restitutions resulting from EPA OIG
investigations
Annual Performance Goal 4:
Criminal, civil and administrative actions reducing risk or loss/operational integrity
Target: 145
Reported: 156
(107% of goal)
Supporting measures
3 Criminal convictions
8 Indictments, informations and complaints
7 Civil actions
56 Administrative actions (other than debarments or suspensions)
36 Suspension or debarment actions
25 Allegations disproved
21 Fraud briefings
Other (no targets established)
Savings and recommendations sustained from current and prior periods (dollars in millions):
• 128 sustained environmental or business recommendations (resolved or agreed-to) for action
• $0.58 sustained questioned costs
• $7.19 sustained efficiencies or adjustments
Reports Issued: 165 (17 issued by EPA OIG and 148 issued by single auditors)
Sources: OIG Performance Measurement and Results System, and the Inspector General Enterprise Management System.
2
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Furthering EPA's Goals and Strategies
When conducting our audit and evaluation work during the first half of FY 2017, we took into account the EPA's
five strategic goals and four cross-agency strategies in the agency's FYs 2014-2018 Strategic Plan. The table below
shows how our reports on the EPA aligned with the agency's goals/strategies.
OIG-lssued Reports — Linkage to EPA Goals and Strategies
OIG Report
Report
No.
Climate
Change/
Air
Quality
Protecting
America's
Waters
Cleaning
Communities/
Sustainable
Development
Safe
Chemicals/
Preventing
Pollution
Enforcing
Laws/
Ensuring
Compliance
Working
Toward
Sustainable
Future
Making
Difference in
Communities
State, Tribal,
Local and
International
Partnerships
Embracing
EPA as High-
Performing
Organization
EPA's Purchase Order Process Needs
to Improve and Achieve Better Value
17-P-0001
X
Management Alert: Drinking Water
Contamination in Flint, Michigan,
Demonstrates a Need to Clarify EPA
Authority to Issue Emergency Orders to
Protect the Public
17-P-0004
X
X
X
Acquisition Certifications Needed for
Managers Overseeing Development of
EPA's Electronic Manifest System
17-P-0029
X
Improvements Needed in EPA's
Information Security Program
17-P-0044
X
EPA's Fiscal Years 2016 and 2015
Consolidated Financial Statements
17-F-0046
X
Status of EPA's Implementation of the
DATA Act
17-P-0050
X
Additional Measures Can Be Taken to
Prevent Deaths and Serious Injuries
From Residential Fumigations
17-P-0053
X
X
Congressionally Requested Audit:
EPA Needs to Improve Processes for
Preserving Text Messages as Federal
Records
17-P-0062
X
Management Alert: Certain State, Local
and Tribal Data Processing Practices
Could Impact Suitability of Data for 8-
Hour Ozone Air Quality Determinations
17-P-0106
X
Risk for EPA's Fiscal Year 2016
Purchase Card and Convenience
Check Program Warrants an Audit
17-P-0113
X
Backlog of Leaking Underground
Storage Tank Cleanups in Indian
Country Has Been Reduced,
but EPA Needs to Demonstrate
Compliance With Requirements
17-P-0118
X
Fraud Controls for EPA's Contract
Laboratory Program Are Adequate, but
Can Be Strengthened With Formal Risk
Assessment and Investigative
Information Sharing
17-P-0119
X
X
EPA Has Adequate Controls to
Manage Advice From Science and
Research Federal Advisory
Committees, but Transparency
Could Be Improved
17-P-0124
X
EPA's 2014 Early-Out and Buyout
Activities Aided Workforce
Restructuring Goals, and Continued
Monitoring of Progress Can Show
Value of Restructuring
17-P-0140
X
3
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Status of Whistleblower Retaliation and
Interference With Independence
Whistleblower Retaliation
Section 5(a)(20) of the Inspector General Act of 1978, as amended, requires a detailed
description of any instances of whistleblower retaliation noted by the EPA OIG. This is
to include information about the official found to have engaged in retaliation, and the
consequences the agency imposed to hold the official accountable. There were no
whistleblower retaliation cases within the semiannual period ending March 31, 2017.
Interference With Independence
Section 5(a)(21) of the Inspector General Act of 1978, as amended, requires a detailed
description of any attempt by the establishment to interfere with the independence of the
EPA OIG. This is to include budget constraints designed to limit the OIG's capabilities,
and incidents where the establishment has resisted OIG oversight or delayed OIG access
to information. There were no instances of interference with independence within the
semiannual period ending March 31, 2017.
4
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
OIG Identifies Funds to Put to Better Use and
Health and Environmental Concerns
During the semiannual reporting period, we issued reports that noted instances of funds
that could potentially be put to better use. For example:
• We estimated that the agency could save approximately $1,184,000 for a 2-year
period ($592,000 annually) by using purchase cards instead of purchase orders.
By using purchase cards, the EPA can obtain refunds and point-of-sale discounts,
and can reduce administrative costs. (Report No. 17-P-0001)
• A breach of information in the Compass Financials database, which houses
Personally Identifiable Information belonging to employees and vendors, could
cost the EPA as much as $3.5 million. This would include the costs to detect,
recover, investigate and manage the incident response, along with costs that result
in after-the-fact activities and efforts to contain additional costs. Improving
controls for Compass Financials could prevent those costs. (Report No. 17-F-0046)
In addition, we found instances in which the EPA can better protect human health and the
environment. For example:
• We found that the EPA can better prevent deaths and serious injuries caused
during residential fumigations by amending sulfuryl fluoride labels and
monitoring compliance. We recommended that the EPA implement a process to
evaluate label changes for all three brands of sulfuryl fluoride to require secured
tenting and fumigation management plans. (Report No. 17-P-0053)
• We found that EPA Region 5 had the authority and sufficient information to
issue a Safe Drinking Water Act Section 1431 emergency order to protect Flint,
Michigan, residents from lead-contaminated water as early as June 2015—much
earlier than it had actually issued such an order. To avoid future public health
harm through drinking water contamination, we recommend that the EPA clarify
for its employees how its emergency authority can and should be used to
intervene in a public health threat. (Report No. 17-P-0004)
Details on these and other issues are in the "Significant OIG Activity" section.
5
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Semiannual Report to Congress
October '!, 2016—March 31, 2017
Sign ficant OIG Activity
Congressional Activities
Report
Congressionaliy Requested Audit: EPA Needs to Improve Processes for
Preserving Text Messages as Federal Records
Report No. 17-P-0Q62, issued December 21, 2016
101-250
Texts
7%
As a result of a congressional inquiry into whether the EPA
preserves text messages as federal records, we did not find
instances where the agency used text messages to intentionally
A podcast on the text
messages report is
available.
251 -500
Texts
4%
501 -1000
Texts
3%
Over 1000
Texts
3%
No Texts
38%
1 -100 Texts
45%
Volume of text messages for EPA employees using
government-issued mobile devices through the EPA's
Working Capital Fund during the first quarter of FY 2015.
(EPA OIG image)
circumvent the Federal Records Act. The EPA
implemented policies and procedures for
preserving text messages, and also took steps to
make employees aware of updated guidance.
However, EPA management still needs to
address the agency's records management and
Freedom of Information Act practices. In
particular, the agency needs to strengthen
controls over documenting procedures for
responding to congressional requests, provide
additional instructions to employees regarding
Freedom of Information Act requests, and
preserve non-transitory text message records
before mobile devices are replaced or messages
are deleted. The agency agreed to take needed
corrective actions.
Briefings
During this reporting period, the OIG provided more than 18 briefings to Congress on the
OIG's work. Specific OIG work receiving much congressional interest included our work
related to water contamination in Flint, Michigan; the Gold King Mine release in
Colorado; and recent employee integrity reports. Several briefings were scheduled to
introduce OIG staff and work to various committee staff of the 115th Congress. During
the reporting period, the OIG also received many congressional requests for specific data.
6
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Semiannual Report to Congress
October '!, 2016—March 31, 2017
Human Health and Environmental Issues
Management Alert: Drinking Water Contamination in Flint, Michigan,
Demonstrates a Need to Clarify EPA Authority to Issue Emergency Orders to
Protect the Public
Report No. 17-P-0004, issued October 20, 2016
A jpodcast and video
on the Flint report are
available.
After Flint switched its drinking water supply in April 2014,
inadequate treatment exposed many of the city's residents to
lead. We found that EPA Region 5 had the autiiority and
sufficient information to issue a Safe Drinking Water Act
Section 1431 emergency order to protect Flint residents as
early as June 2015. Although EPA Region 5 did not issue an
emergency order, because the region concluded that state
actions were a jurisdictional bar, EPA guidance allows the
EPA to take action if it deems state actions to be insufficient.
Ultimately, in January 2016, EPA headquarters issued an
emergency order to take specific actions on the public health
threat. We
Flint Water Plant, Flint, Michigan. issued this
(EPA OIG photo)
management
alert report to
prevent agency delays in the future.
We recommended that the agency update
guidance for its employees on emergency
authority to avoid harm to the public
through drinking water contamination.
The OIGs evaluation of the Flint Flint River in Flint, Michigan. (EPA OIG photo)
drinking water crisis is ongoing, and we
expect to issue an additional report.
IVIRONMENTAL iPRuTECTION AGENCY"
An EPA emergency response vehicle in Flint, Michigan. (EPA OIG photo)
7
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Semiannual Report to Congress
October '!, 2016—March 31, 2017
Additional Measures Can Be Taken to Prevent Deaths and Serious Injuries From
Residential Fumigations
Report No. 17-P-0053. issued December 12, 2016
The EPA can better prevent deaths and serious injuries caused
A pod cast on the
during residential fumigations by amending sulfuryl fluoride labels residential fumigations
— and monitoring compliance. Since report is available.
2002, at least 11 deaths and two
serious injuries occurred during residential fumigations in
California and Florida—the two U.S. states with the most
fumigation treatments. Compliance with current pesticide
use requirements does not always prevent adverse
impacts. We identified multiple factors that contributed to
these adverse impacts, such as not requiring secure
tenting around structures undergoing fumigation,
ineffective devices used to detect pesticide levels inside
A Florida residence is fumigated with sulfuryl fluoride of Structures, and pesticide applicators not attending
to combat drywood termites. (EPA OIG photo) mandatory training. The agency provided acceptable
corrective actions for all seven recommendations.
Backlog of Leaking Underground Storage Tank Cleanups in Indian Country Has
Been Reduced, but EPA Needs to Demonstrate Compliance With Requirements
Report No. 17-P-0118, issued March 6, 2017
The EPA was unable to demonstrate how it was complying with the requirements of the
Energy Policy Act of 2005 to give priority in Indian country to releases from leaking
underground storage tank sites that present the
greatest threats to human health or the environment.
The EPA had a prioritization process to make annual
funding decisions, but this process was minimally
documented, relied on inconsistent regional criteria,
and lacked transparency. As a result, we did not find
evidence that the EPA's process for selecting and
funding sites for cleanup actions prioritized those sites
presenting the greatest threat to human health or the
environment. Delays in cleanup at higher-risk sites
could result in prolonged exposure to hazardous
contaminants, such as gasoline leaks contaminating
groundwater. The agency agreed with the
recommendations, provided corrective actions, and
initiated improvements.
An underground storage tank being
removed. (EPA photo)
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Semiannual Report to Congress
October '!, 2016—March 31, 2017
Management Alert: Certain State, Local and Tribal Data Processing Practices
Could Impact Suitability of Data for 8-Hour Ozone Air Quality Determinations
Report No, 17-P-Q106, issued February 6, 2017
Air monitoring data on ozone that the EPA received from Georgia and South Carolina
were not always processed according to recommended practices. This processing
included making certain quality control adjustments to data before they were reported to
the EPA's Air Quality System, which is used to determine whether an area's air quality
meets the National Ambient Air Quality Standard for ozone. A nonattainment designation
means that an area's air contains unhealthy levels of pollution, and the state must develop
a plan to improve air quality. Generally, the EPA does not recommend adjusting raw data
before reporting them to the Air Quality System, but our analysis of 3 years of
nationwide data showed that about 26 percent of the hourly data reported were different
than the originally recorded values. Thus, there is a risk that other monitoring agencies
were improperly adjusting their data. We alerted the EPA to this risk. Designation
determinations can have significant implications for public health and an area's economy.
Pending completion of our ongoing work, we made no recommendations. The agency has
initiated actions to assess these risks.
8-Hour Ozone Nonattainment Areas (as of 9/22/2016)
8-hour Ozone Classification
I I Extreme
I I Severe 15
I I Serious
( | Moderate
I I Marginal
I Nonattainment areas are indicated by color. |
National map of the 8-hour ozone nonattainment areas (2008 standard), as of September 22,2016. (EPA image)
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Semiannual Report to Congress
October '!, 2016—March 31, 2017
EPA Has Adequate Controls to Manage Advice From Science and Research
Federal Advisory Committees, but Transparency Could Be Improved
Report No. 17-P-0124. issued March 13, 2017
We found that the EPA has an effective system of controls to address the advice and
recommendations from its eight science and research federal advisory committees. The
1972 Federal Advisory Committee Act and EPA guidance and policy establish
procedures by which the agency should manage these committees, including assigning
Designated Federal Officers as committee managers and making the committee process
transparent. To increase transparency, the EPA should directly respond to all federal
advisory committee products, and Designated Federal Officers should post all responses
online. Further, in addition to program offices, Designated Federal Officers should track
the status of recommendations. The agency agreed with all recommendations, and
corrective actions are pending or have been completed.
Science and research federal advisory committees at the EPA
1.
Board of Scientific Counselors
2.
Chemical Safety Advisory Committee
3.
Children's Health Protection Advisory Committee
4.
Clean Air Scientific Advisory Committee
5.
Environmental Laboratory Advisory Board
6.
Federal Insecticide, Fungicide, and Rodenticide Act Scientific Advisory Panel
7.
Human Studies Review Board
8.
Science Advisory Board
Source: OIG summary of information in individual committee charters.
Members of the Science Advisory Board, an EPA federal advisory committee, attend a meeting.
(EPA photo)
10
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Agency Business Practices and Accountability
EPA's 2014 Early-Out and Buyout Activities Aided Workforce Restructuring
Goals, and Continued Monitoring of Progress Can Show Value of Restructuring
Report No. 17-P-0140, issued March 23, 2017
The EPA used its voluntary early retirement and voluntary separation incentive payment
authorities in 2014 to buy out employees in certain targeted positions. The EPA paid
$11.3 million in incentives to get 456 employees to voluntarily leave the agency, plus
paid $4.9 million in annual leave payments to those employees, for total payments of
about $16.2 million. This action helped the agency accomplish certain restructuring
goals, including reducing the size of offices, reducing the number of highly graded
positions, and eliminating surplus positions. Although progress has been made in filling
positions designated for restructuring, not all restructuring goals had been achieved at the
time we concluded our review. We made various recommendations to help the agency
better monitor its restructuring efforts, and the agency agreed with our recommendations.
Annual leave
payments
$4.9 million
$16.2
million
Fraud Controls for EPA's Contract Laboratory Program Are Adequate, but Can Be
Strengthened With Formal Risk Assessment and Investigative Information Sharing
Report No. 17-P-0119, issued March 6, 2017
The EPA's Contract Laboratory Program has instituted four of five internal controls that
provide reasonable assurance that the potential for lab fraud is minimized. However, one
component—risk assessment—is carried out
informally, and the risk assessments and associated
controls to address those risks have not been formally
defined. Formal risk assessments would provide
assurance that program controls address risks, as well
as a clear picture of efforts to address lab performance
deficiencies. We recommended that the EPA conduct
and document a formal risk assessment of the Contract Laboratory Program. In addition,
we recommended that investigative units from both the agency and the EPA OIG share
information from lab fraud findings with EPA program and regional offices. The agency
Since the 1980 inception of the
Contract Laboratory Program, 180 labs
in the program have performed over
3.7 million analyses from more than
20,900 sites, at an expense of
approximately $431.5 million.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
agreed to take the corrective actions, while the OIG completed its corrective action of
sharing information.
EPA's Fiscal Years 2016 and 2015 Consolidated Financial Statements
Report No. 17-F-0046, issued November 15, 2016
We rendered an unmodified opinion on the EPA's consolidated financial statements for
FYs 2016 and 2015, meaning they were fairly presented and free of material
misstatement. However, we noted the following material weaknesses:
• The EPA's accounting for software continues to be a material weakness.
• The EPA incorrectly recorded unearned revenue for Superfund special accounts,
and did not reconcile unearned revenue for those accounts.
We also noted significant deficiencies involving the following issues:
• The EPA wrote off cash differences with
the U.S. Department of the Treasury
without adequate support.
• The EPA did not clear suspense
transactions timely.
• The EPA erroneously reclassified a real
property capital lease.
• The EPA did not have controls to monitor
direct access to the Compass database.
• The EPA did not have adequate
documentation for restoring application
controls at the National Computer Center.
• The EPA needs to improve off-site storage
of data backups.
The agency generally agreed with our findings and
recommendations.
EPA's Purchase Order Process Needs to Improve and Achieve Better Value
Report No. 17-P-0001, issued October 13, 2016
In FY 2015, up to 1,714 purchases at the EPA could have been made with purchase
cards, as opposed to purchase orders, to achieve cost savings as required by the Federal
Acquisition Regulation. In addition, the EPA's acquisition system did not always provide
descriptions for supplies and services purchased. These conditions occurred because of
inadequate policies, procedures and training. We recommended that the agency update its
EPA OIG Is One of Few OIGs to Perform
Financial Statement Audits With In-House Staff
Having qualified staff and being able to offer the
taxpayer significant savings, the EPA OIG is one of
few OIGs in the federal government that conducts
financial statement audits of its agency using
in-house staff. When the EPA OIG sought to contract
out its financial statement auditing in 2007 per
Office of Management and Budget (OMB) Circular A-
76, "Performance of Commercial Activities," the EPA
OIG submitted its own bid and came in more than
$1 million under the lowest acceptable bid from a
certified public accounting firm. The EPA OIG team
that audits financial statements is led by an
experienced certified public accountant, and many
of the team members are also certified public
accountants. In addition, the EPA OIG audits the
financial statements for EPA pesticide and
e-manifest funds.
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October '!, 2016—March 31, 2017
policies, procedures and checklists; require acquisition and program personnel to be
trained; and promote greater use of purchase cards. The agency provided planned
corrective action plans and completion dates for all 10 recommendations.
Risk for EPA's Fiscal Year 2016 Purchase and Convenience Check Program
Warrants an Audit
Report No. 17-P-0113, issued February 14, 2017
We assessed that the risk to the EPA's purchase card and convenience check program
was high enough to warrant an audit because of noncompliance with existing internal
controls. The Government Charge Card Abuse Prevention Act of 2012 requires each
Inspector General to conduct periodic assessments of its
agency's purchase card and convenience check program to
identify and analyze risks of illegal, improper or erroneous
purchases and payments. Our risk assessment noted that
none of the 18 transactions reviewed were in compliance
with all 14 of the internal controls tested. Because we
conducted a risk assessment, we did not issue
recommendations; however, due to the noncompliance
noted, we will conduct a full audit of the program in
FY 2017. The agency already initiated actions to address
the instances of noncompliance.
Status of EPA's Implementation of the DATA Act
Report No. 17-P-0050, issued December 2, 2016
The EPA has taken steps to implement the Digital Accountability and Transparency Act
of 2014, also known as the DATA Act. The act directs federal agencies to report financial
and payment information on a website accessible to taxpayers and policy makers. As
required, the EPA plans to go live with this website in May 2017, using partial data and a
phased-in approach. The agency has
completed the first three steps of the
eight-step process for implementing the
DATA Act, as established by OMB and
the U.S. Department of the Treasury
(see table). The EPA was implementing
Steps 4 and 5 at the time of our audit,
with plans to complete Steps 6 through 8
by May 2017. The agency has identified
potential mitigations to address risks to
DATA Act implementation.
| SmartPay 2 United States of America
Supporting your mission If misuse suspected, call (800) xxx-xxxx
U. S. Government Tax Exempt
V. 1
A sample government purchase card.
(U.S. General Services Administration)
DATA Act implementation plan for agencies
Steps for agencies
1
Organize team
2
Review elements
3
Inventory data
4
Design and strategize
5
Prepare data for submission to broker
6
Test broker implementation
7
Update systems
8
Submit data
Source: OMB's and Treasury's DATA Act
Implementation Playbook.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Improvements Needed in EPA's Information Security Program
Report No. 17-P-0044, issued November 14, 2016
The EPA needs to take additional steps to achieve managed and measurable information
security function areas to mitigate cybersecurity risks. A robust but agile information
security infrastructure is paramount to combat cybersecurity attacks, and we annually
review the EPA's cybersecurity per the Federal Information Security Modernization Act
of 2014. Our FY 2016 review found that the EPA's information security function areas—
Identify, Protect, Detect, Respond and Recover—as well as their corresponding metric
domains, did not meet the defined requirements to be considered effective. The EPA
agreed with our results, and we made no recommendations based on our analysis.
Security Protect Detect Respond Recover
Functions
Metric
Domains
Configuration
Management
Identity &
Access
Management
Security &
Privacy
Training
Information
Security
Continuous
Monitoring
Incident
Response
Contingency
Planning
Cybersecurity Framework Security Functions and corresponding FY 2016 Inspector General
Federal Information Security Modernization Act of 2014 metric domains. (EPA OIG graphic)
Acquisition Certifications Needed for Managers Overseeing Development of
EPA's Electronic Manifest System
Report No. 17-P-0029, issued November 7, 2016
We found that program and project managers responsible for overseeing the development
of the EPA's Electronic Manifest System (also known as the e-Manifest system) did not
obtain the required federal certification necessary to oversee a major acquisition. The
e-Manifest system is being designed to create a means to track off-site shipments from
hazardous waste generators. Ineffective oversight could cause
project delays that postpone the EPA's ability to provide
emergency responders with data about hazardous waste shipments.
The EPA agreed with our recommendations, completed corrective
actions for one recommendation, and provided planned corrective
action for the other.
The e-Manifest system is being
designed to create a means to track
off-site shipments of hazardous waste
from a generator's site to the site of
the receipt and disposition of the
hazardous waste.
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October 1, 2016—March 31, 2017
Investigations
Individual Sentenced for Defrauding EPA and Other Agencies
On December 1, 2016, Alexander Robert Xavier, of Jensen Beach, Florida, was
sentenced in the U.S. District Court for the Southern District of Florida to 12 Vi years in
prison related to a fraudulent surety bond scheme that impacted numerous federal
agencies and government contractors. Xavier also was ordered to pay more than
$4 million in restitution to 14 federal agencies—including the EPA—as well as
contractors. Also, effective October 26, 2016, Xavier and three of his companies were
suspended from participation in federal contracts and assistance programs pending the
resolution of legal proceedings. A jury previously found Xavier guilty of major fraud,
mail fraud and making a false statement to the U.S. Department of the Army in July
2016. The evidence at trial showed that Xavier issued a large number of worthless bonds
to various contractors performing work for various government agencies.
The $4 million restitution was joint and several with two other co-defendants—Kelly A.
Spillman and Brian J. Garrahan, both of Delray Beach, Florida—for their participation in
the fraudulent insurance bond scheme. On April 21, 2016, Spillman and Garrahan
pleaded guilty to conspiracy to commit mail and wire fraud. Effective March 6, 2017,
Garrahan, Quantum Partners (a company owned by Garrahan) and Spillman were
debarred for 5 years from participating in federal procurement and non-procurement
programs. Further, on March 22, 2017, an additional 22 entities related to Garrahan
and/or Spillman were similarly debarred for 5 years.
This investigation is ongoing and is being conducted jointly with the Criminal
Investigation Command of the U.S. Army: the Defense Criminal Investigative Service; the
U.S. General Services Administration; and the OIGs of the U.S. Departments of Veterans
Affairs, Defense, Energ\>, Housing and Urban Development, and State.
Construction Companies Violated Disadvantaged Business
Enterprise Program
On December 15, 2016, Wallace Construction Corp. and Rosciti Construction Inc., both
of Providence, Rhode Island, signed a civil settlement agreement with the
U.S. Department of Justice (DOJ) to pay the U.S. government $1 million to resolve civil
allegations that they violated the False Claims Act by submitting claims earmarked for
minority, women-owned or small businesses that they were not entitled to receive. Both
companies also entered into administrative agreements with the EPA's Office of
Suspension and Debarment. It was alleged that Wallace was not at the time a legitimate
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October 1, 2016—March 31, 2017
disadvantaged business enterprise and lacked the capacity to perform necessary work on
the projects.
This investigation was conducted jointly with the U.S. Attorney's Office for the District of
Rhode Island, and the OIGs of the U.S. Departments of Transportation and Education.
Man Convicted of Fraud in Scheme to Collect Stimulus Funds
On March 15, 2017, ajury convicted a Republic of Korea person on multiple fraud
charges for deceiving U.S. municipalities into spending federal stimulus money on his
company's foreign-made products. He was convicted on five counts of wire fraud and
three counts of fraudulent importation of goods into the United States. A sentencing date
has not yet been scheduled.
Heon Seok Lee had served as President of KTurbo Inc. in the Republic of Korea and
President of its subsidiary—KTurbo USA Inc.—with an office and warehouse in Illinois.
From January 2010 to February 2011, Lee directed others to procure contracts for
KTurbo to provide centrifugal turbo blowers to municipal wastewater treatment facilities
in the United States, receiving American Recovery and Reinvestment Act funds from the
EPA. Lee and others sent at least five email communications to U.S. municipal
wastewater treatment facilities falsely representing that KTurbo would manufacture and
deliver turbo blowers in compliance with the "Buy American" provision of the Recovery
Act. Lee had nine turbo blowers sent to the KTurbo facility in Illinois from Korea that
already were largely assembled in Korea but had "Assembled in USA" placards. Lee and
others did not intend to perform substantial transformation of the turbo blowers. In total,
Lee and others intended to fraudulently obtain over $1.3 million in Recovery Act funds.
This case is being conducted with Interpol the U.S. Department of Homeland Security,
and DO J.
Two Individuals and Company Indicted for Falsifying Water Samples
Two Florida men and a Florida company were indicted on charges related to a scheme to
falsify water samples during testing of new water lines. On December 15, 2016, in the
U.S. District Court for the Middle District of Alabama, Billy Ray Roberson Sr. of Milton,
and Darin Lewis of Crestview, as well as the company Roberson Excavation Inc.,
headquartered in Milton, were indicted and charged with conspiring to commit wire fraud.
Roberson was the owner and president of Roberson Excavation. According to court
documents, in 2014, the Dale County Water Authority in Alabama hired Roberson
Excavation to replace water lines in the Marley Mill neighborhood. The project was
valued at approximately $1 million and funded through the EPA's State Revolving Fund
program. By February 2015, Roberson Excavation was 3 months behind schedule on the
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
job and paying penalties of $500 for each day the project went incomplete. At that time,
Roberson allegedly instructed his site supervisor, Lewis, to falsify the testing required
before the lines went into operation, including tests used to determine whether harmful
bacteria were present in the water.
On February 16, 2017, Lewis pleaded guilty to one count of conspiring to commit wire
fraud related to the case. Roberson and Roberson Excavation are scheduled for trial on
June 5, 2017. Lewis is scheduled to be sentenced on June 29, 2017.
Effective on February 27, 2017, Roberson, Roberson Excavation, Roberson Underground
Utilities LLC (a company started by Roberson), Lewis, and A Southern Co. LLC (a
company owned by Lewis) were all suspended from participation in federal contracts and
assistance programs pending the resolution of these legal proceedings.
This investigation is ongoing and being conducted jointly with the EPA Criminal
Investigation Division.
State University Office Returns Clean Water Act Grant Funds
Between January and March 2017, a state university office of local government returned
$368,400 to the EPA after an investigation disclosed that the office did not spend EPA
Clean Water Act grant funds that the office had told the EPA it had expended. In total,
the investigation questioned approximately $486,709 in grant funds from calendars years
2012 to 2015. The investigation is ongoing.
Federal Security Officer Assaulted With Gun in EPA Region 4 Office
A woman was charged with assault for attacking a security officer at the EPA Region 4
building in Atlanta, Georgia, grabbing the officer's gun and then firing a shot. On
February 8, 2017, the woman allegedly entered the EPA Region 4 reception area asking
to use the EPA library, refused to provide identification, became belligerent, engaged in a
physical confrontation with a security officer, removed the security officer's weapon
from the holster, and fired a single round before being apprehended. No one was injured
by the shot. On February 22, 2017, an indictment was issued charging the woman with
one count of assaulting a federal officer.
This investigation is ongoing and is being conducted jointly with the U.S. Department of
Homeland Security's Federal Protective Service.
Bar Notices Issued After Threatening Emails Sent
On November 3, 2016, a bar notice was issued for an individual who sent a threatening
email to Gina McCarthy, the former EPA Administrator. In the email, the individual
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
mentioned the harmful use of glyphosate and provided personal contact information.
During an interview at the individual's home, an SKS assault rifle was found. The subject
advised during the interview of having a mental illness (paranoid schizophrenia), and
admitted to threatening McCarthy and other politicians for years via the internet. The
individual did not have a criminal history but was known by federal law enforcement
agencies for making prior threats to politicians. The bar notice prohibits the individual
from entering the EPA Region 6 and headquarters buildings. The case was declined for
prosecution by DO J.
Also on November 3, 2016, another bar notice was issued for a different citizen who sent a
threatening email to an EPA employee. The subject sent 18 additional emails to the
employee. The impetus for the emails appeared to be frustration over the National
Pollutant Discharge Elimination System permit process. The investigation found that the
individual had an extensive criminal history. The bar notice prohibits the citizen from
entering an EPA facility. The case was declined for prosecution by DOJ.
EPA Employee Removed for Payroll Fraud
On January 27, 2017, a GS-13 employee was terminated from the EPA for fraudulently
receiving payroll funds in excess of what was appropriate. The employee, who was
assigned to an EPA office in California, was authorized to telework full-time due to a
reasonable accommodation agreement. Management discovered that the employee had
moved out of state and was believed to have been teleworking from the new location for
several months while still receiving the higher locality pay associated with the California
office. The employee was overpaid approximately $12,000. The EPA is pursuing
collection of these funds.
EPA Employee Terminated for Personnel Violations
On December 9, 2016, a GS-12 employee was terminated from the EPA for violating a
warning letter and for not working days that the employee recorded as worked in the
official EPA timekeeping system. The employee had been issued a warning letter in 2014
after making false, malicious or unfounded statements against co-workers and
government officials. Evidence was found showing that the employee violated the
warning letter. Further, while the employee worked from home full-time under a
reasonable accommodation agreement for a medical condition, the investigation disclosed
that the employee was frequently absent from the approved telework location. In
addition, the person was found to be in violation of the medical telework agreement. The
employee was terminated from the EPA for conduct unbecoming a federal employee and
failure to follow instructions.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
EPA Employee Resigns From Agency, Pleads Guilty to Theft
On November 4, 2016, an EPA GS-8 employee resigned from federal service, and on
December 20, 2016, pleaded guilty to theft in state court stemming from theft from an
employee association. The EPA employee, who was a co-president of an EPA regional
employee association, confessed to stealing $424 in cash entrusted to the position and
using the funds for personal gain. The employee also confessed to shredding $488 in
checks associated with the same fundraiser instead of depositing them into the employee
association account. In September 2016, the employee was placed on indefinite
suspension without pay, pending the outcome of the criminal investigation and associated
judicial proceedings. The employee was sentenced by the district court to 6 months of
probation, a $250 fine, and $424 in restitution.
EPA Employee Retires After Time-and-Attendance Violations
On October 28, 2016, an EPA GS-9 employee retired from federal service while
administrative action was pending, due to investigative findings that the employee
falsified time-and-attendance records for a year and a half. The EPA had been in the
process of preparing a letter to the employee proposing a 30-day suspension, based on
177 hours of inaccurate reporting, including 115 hours of absences without leave and
37 instances of failing to follow leave procedures. The former employee was issued a
debt letter for overpayment of $6,822, and the EPA is pursuing collection of the funds.
EPA Employee Suspended for Lack of Disclosure
On December 2, 2016, an EPA GS-11 employee received a 3-day suspension for lack of
candor after it was found that the employee did not properly disclose a prior criminal
offense. As part of a background investigation, documentation showed that the employee
had been indicted in 2010 on two felony counts of witness tampering. In 2011, the
employee was convicted and sentenced to 2 years" confinement (suspended sentence) and
5 years" probation, and ordered to pay a $1,500 fine. The investigation determined that
the employee was not truthful in completing the SF-85P, Questionnaire for Public Trust
Positions, since prior indictment was not disclosed.
Former Employee Arrested for Violent Threats
On December 19, 2016, a former EPA employee was arrested in California for felony
threats (threatening to kidnap or injure a person). The former employee allegedly made
numerous threatening communications in the form of phone calls and emails to many
individuals within the EPA organization, including the then EPA Administrator
Gina McCarthy and her executive office staff. These communications allegedly included
threats of death and bodily harm for perceived wrongs that occurred during the former
employee's termination process. Charges against the individual are pending.
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October 1, 2016—March 31, 2017
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 the CSB's programs and operations. Details on our
work involving CSB are available on this OIG w ebpagc.
Audit Reports
CSB Has Effective "Identify" and "Recover" Information Security Functions,
but Attention Is Needed in Other Information Security Function Areas
Report No. 17-P-0045, issued November 14, 2016
CSB needs to take additional steps to achieve an overall managed and measurable
information security program that can effectively mitigate cybersecurity risks. The
Federal Information Security Modernization Act of 2014 requires the OIG to annually
evaluate CSB's information security program designed to protect CSB's operations and
assets. We found that two of the five information security function areas at CSB (Identify
and Recover) were effective. However, we found that improvements are needed for the
other three areas reviewed (Protect, Detect and Respond). We discussed specifics with
CSB, which agreed with our results.
Audit of the U.S. Chemical Safety and Hazard Investigation Board's
Fiscal Years 2016 and 2015 Financial Statements
Report No. 17-F-0047, issued November 15, 2016
The firm that audited CSB's financial statements for FYs 2016 and 2015 on behalf of the
EPA OIG found the statements to be fairly presented and free of material misstatements.
The firm noted no matters involving the internal control and the CSB operation that it
considered to be a material weakness. However, the firm identified a significant
deficiency in that CSB's internal controls over financial reporting were not sufficiently
designed to detect and correct material errors in the agency's financial statements.
Specifically, the firm found that CSB did not disclose in a note a $1 million material
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
difference on net outlays, did not prepare explanations for other material differences, did
not properly record calculated imputed costs, and did not record an accrual for all agency
liabilities. CSB corrected all errors noted, and concurred with recommendations to
improve policies and procedures.
CSB Complied With Improper Payment Legislation Requirements for
Fiscal Year 2016
Report No. 17-P-0123, issued March 9, 2017
CSB was fully compliant with legislation for improper payments during FY 2016.
Legislation requires agencies to report on, reduce and recapture improper payments.
Inspectors General are also required to determine whether the agencies for which they are
responsible comply with the legislation. We found that, as required, CSB published its
Performance and Accountability Report and posted that report and accompanying materials
on its website. Also, CSB conducted a risk assessment and did not identify any programs
and activities that are susceptible to significant improper payments. We did not make any
recommendations.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Hotline Activities
The purpose of the EPA OIG hotline is to receive complaints of fraud, waste or abuse in
EPA programs and operations, including mismanagement or violations of law, rules or
regulations by EPA employees or program participants. Examples of reportable violations
include contract, procurement and grant fraud; bribery and acceptance of gratuities;
significant mismanagement and waste of funds; conflict of interest; travel fraud; abuse of
authority; theft or abuse of government property; and computer crime. As a result of
hotline complaints, the OIG may conduct audits and evaluations, as well as investigations.
In addition to being responsible for the EPA hotline, we are responsible for the CSB
hotline. Details on investigations during the semiannual reporting period follow.
Significant Investigations of EPA
EPA Employee Resigns After Time-and-Attendance Violations
On March 15, 2017, an EPA GS-13 employee resigned from federal service after being
interviewed by the OIG in connection with a hotline complaint regarding time-and-
attendance violations. The investigation found that the employee submitted and attested
time-and-attendance records claiming to be in work status while the employee was, in
fact, on personal travel. It was determined that the employee took seven international
trips over a 6-year period, each time claiming regular and/or telework hours. The OIG
conducted a limited audit of the employee's time-and-attendance records to compare the
travel activity with the corresponding time-and-attendance records. Based on the audit,
the employee claimed 109.5 hours of work, valued at $5,707, while on personal travel.
An investigative report was provided to EPA management, but the employee resigned
before the agency could administratively adjudicate this matter.
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Semiannual Report to Congress
October '!, 2016—March 31, 2017
Hotline Statistics
The following table shows EPA OIG hotline activity regarding complaints of fraud,
waste and abuse in EPA programs and operations during the semiannual reporting period
ending March 31, 2017.
Semiannual period
(October 1,2016-
March 31, 2017)
Issues open at the beginning of the period
188
Inquiries received during the period
197
Inquiries closed during the period
93
inquiries pending at the end of the period
292
Issues referred to others
OIG offices
154
EPA program offices
35
Other federal, state and local agencies
8
Contacts to the EPA OIG Hotline
4,683
(telephone, voice mail, emails, website and correspondence)
The table below details the categories of inquiries the EPA OIG hotline receives that are
retained by the EPA OIG and are reviewed by investigation, audit or evaluation. For the
semiannual period, the hotline sent 154 out of the 197 inquiries received to the OIG for
review and action
154 REFERRALS TO EPA OIG
OCTOBER 1, 2016 - MARCH 31, 2017
Computer Crimes
Programmatic and Operations
Contracts
Grants
Employee Ethics
Employee Misconduct
Employee Time & Attendance
Threat & Workplace Violence
Laboratory Fraud
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
The EPA OIG hotline receives complaints pertaining to all of the EPA regions as well as
headquarters. The table below details the total number (197) of inquiries for the
semiannual period by headquarters and region.
HOTLINE REFERRALS
OCTOBER 1, 2016 - MARCH 31, 2017
GEOGRAPHIC BREAKDOWN
90
80
70 78
60
50
40
30
_
_
19
13
15
14
14
15
4
12
The hotline makes it easy to report allegations of fraud, waste, abuse, mismanagement or
misconduct in the programs and operations of the EPA. Employees—as well as
contractors, grantees, program participants and members of the general public—may
report allegations to the OIG. Complaints may be submitted to the hotline by phone, fax
or mail, or electronically by using email or the OIG's online complaint form. Individuals
who are concerned about the confidentiality or anonymity of electronic communication
may submit allegations by telephone or mail.
The Inspector General Act of 1978, as amended, and other laws protect those who make
hotline complaints. For example, the Whistleblower Protection Enhancement Act of 2012
provided protection to employees who disclose misconduct or misuse of government
resources.
Individuals who contact the hotline are not required to identify themselves and may
request confidentiality when submitting allegations. However, the OIG encourages those
who report allegations to identify themselves so that they can be contacted if the OIG has
additional questions. Pursuant to Section 7 of the Inspector General Act, if a hotline
complainant is an EPA employee, the OIG will not disclose the employee's identity
unless that employee consents or the Inspector General determines that such disclosure is
unavoidable during the course of the investigation, audit or evaluation. As a matter of
policy, the OIG will provide comparable protection to employees of contractors, grantees
and others who provide information to the OIG and request confidentiality.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Other Activities
Legislation and Regulations Reviewed
Section 4(a) of the Inspector General Act requires the Inspector General to review
existing and proposed legislation and regulations relating to the program and operation of
the EPA and to make recommendations concerning their impact. We also review drafts of
OMB circulars, memorandums, executive orders, program operations manuals, directives
and reorganizations. The primary basis for our comments is the audit, evaluation,
investigation and legislative experiences of the OIG, as well as our participation on the
Council of the Inspectors General on Integrity and Efficiency. During the reporting
period, we reviewed 28 proposed changes to legislation, regulations, policy, procedures
or other documents that could affect the EPA or the Inspector General, and provided
comments on two.
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Other Results of OIG Work
Follow-Up an Important Aspect of OIG Efforts
For audit and evaluation efforts to be effective, it is important for an OIG to follow up on
certain previously issued reports to ensure that appropriate and effective corrective actions
have been taken. For the reports listed below that were issued during the semiannual
reporting period ending March 31, 2017, our review included follow-up.
Report No.
Report Title
Date
17-P-0044
Improvements Needed in EPA's Information Security
Program
November 14, 2016
17-P-0045
CSB Has Effective "Identify" and "Recover"
Information Security Functions, but Attention Is
Needed in Other Information Security Function Areas
November 14, 2016
17-F-0046
EPA's Fiscal Years 2016 and 2015 Consolidated
Financial Statements
November 15, 2016
17-P-0062
Congressionally Requested Audit: EPA Needs to
Improve Processes for Preserving Text Messages as
Federal Records
December 21, 2016
17-P-0113
Risk for EPA's Fiscal Year 2016 Purchase Card and
Convenience Check Program Warrants an Audit
February 14, 2017
17-P-0123
CSB Complied With Improper Payment Legislation
Requirements for Fiscal Year 2016
March 9, 2017
Also, in compliance with reporting requirements of Section 5(a)(3) of the Inspector General
Act of 1978, as amended, we are to identify each significant recommendation described in
previous semiannual reports on which corrective action has not been completed. This
information is provided in detail in Appendix 3, "Reports With Corrective Actions Not
Completed." Two examples of why recommendations remained unimplemented follow:
• In a 2009 report evaluating the agency's financial statements, we recommended
that the agency ensure that all new financial management systems (including the
Integrated Financial Management System replacement system) and those
undergoing upgrades include a system requirement that the fielded system include
automated controls to enforce separation of duties. In addition to many corrective
actions that have already been completed, the Office of the Chief Financial
Officer's Office of Technology Solutions plans to modify Compass user profiles to
create specific security roles to allow Compass Security Officers to better manage
user access. It also plans to enhance the Access Request Form application to add
additional controls and automatic logic to check for approved waivers on file to
prevent users from submitting security options that violate the separation of duties
policy. The completion of these corrective actions have been extended to
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December 31, 2017, due to other, high priority projects. The Office of Technology
Solutions indicated it will seek additional resources to complete these tasks.
(Report No. 10-1-0029)
• In a 2012 report evaluating the EPA's steps to ensure the quality and consistency of
oil spill prevention and response plans and how the EPA tracks violators under the
Clean Water Act Section 311 program, we recommended that the agency improve
oversight of facilities regulated by the EPA's oil pollution prevention program by:
a. Developing procedures for updating and issuing new guidance to ensure
the regulated community has access to the most current guidance.
b. Implementing a risk-based strategy toward inspections that identifies
unknown facilities and directs inspection resources toward facilities where
the potential for spills poses the greatest risks.
c. Consistently interpreting regulations and the EPA's authority to enforce
regulations.
d. Producing a biennial public assessment of the quality and consistency of
Spill Prevention, Control and Countermeasure Plans and Facility Response
Plans based on inspected facilities.
While the agency has completed actions to address items "a" through ""c." for
item "d" it still plans to develop a summary of findings to help identify areas where
additional guidance and outreach are needed to improve the quality and consistency
of Spill Prevention, Control and Countermeasure Plans. The model is then to be
used to develop a review protocol for Facility Response Plans to examine Facility
Response Plan inspections conducted during the FY 2013 inspection cycle.
A summary of findings is to be developed to help identify areas where additional
guidance and external outreach are needed to improve the quality and consistency
of Facility Response Plans. Reduced resources and available personnel and other
priorities have delayed effort on this milestone for at least a year. In addition,
recent enactment of the Water Resources Reform and Development Act places
additional priority responsibilities on the Spill Prevention, Control and
Countermeasure program. Consequently, action on this corrective action is not
expected to begin until at least June 2017. (Report No. 12-P-0253)
27
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Single Audit Reporting Efforts Make Impact
In accordance with the Single Audit Act of 1984 and OMB guidance, nonfederal entities that
expend more than $750,000 in federal funds (usually in the form of grants) are required to
have a comprehensive annual audit of their financial statements and compliance with major
federal program requirements. The entities receiving the funds include states, local
governments, tribes and not-for-profit organizations. The act provides that grantees are subject
to one annual comprehensive audit of all their federal programs versus a separate audit of each
federal program, hence the term "single audit." The audits are usually performed by private
firms. Federal agencies rely upon the results of single audit reporting when performing their
grants management oversight of these entities.
The OIG provides an important customer service to the EPA by performing technical
reviews of single audit reports, and issues reports to the EPA for audit resolution and
corrective action. The OIG's reports recommend that EPA action officials confirm that the
corrective actions have been taken. If the corrective actions have not been implemented, the
EPA needs to obtain a corrective action plan, with milestone dates, for addressing the
findings in a single report. For example:
• The single audit report for the Maryland Coastal Bay Foundations Inc. for FY 2015
identified six findings related to the Comprehensive Estuarine Management
program. The foundation claimed unallowable costs related to excessive severance
pay to terminated employees, unsupported bonuses and unnecessary conference
travel costs under the EPA grant. EPA Region 3 substantially concurred with the
single audit report findings and required the foundation to repay $38,289.
• The single audit report for the Massachusetts Clean Water Trust for FY 2015
reported that the trust fund allowed loan payments to one borrower outside of the
loan period and significantly prior to the project start period. This finding raised
concerns regarding the allowability of such payments. We raised this matter with
Region 1, and the region worked with the recipient to determine the best course of
action. The recipient developed internal controls to help ensure such payments would
not take place in the future.
Summary of OIG single audit activity for the semiannual period ending
March 31, 2017
No. of
reports
issued
No. of findings
reported to
EPA
Reported
questioned
costs
Quality review
of single audit
reports
Deficiency
letters issued to
single auditors
148
328
$74,506
0
0
Source: OIG analysis.
28
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
The OIG also provides technical assistance and advice to the EPA, single auditors and others
as they relate to the single audit process. For example, the EPA OIG National Single Audit
Coordinator was invited to present at the American Institute of Certified Public Accountants"
National Training for Government and Non-Profit Entities. The coordinator presented
information on common single audit challenges that EPA grantees face, and fielded technical
questions from single auditors and grant recipients.
29
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Actions Taken on Reports Result in Improvements
The EPA has taken a number of corrective actions based on audit and evaluation reports
issued during the current and prior semiannual reporting periods. Examples follow.
• As a result of actions taken by the agency in response to EPA OIG
recommendations to improve scientific integrity training, the agency won a
prestigious 2016 bronze Telly Award (from more than 13,000 entries). In two
reports, the OIG noted weaknesses in staff awareness of scientific integrity policy,
and recommended that the Office of Research and Development work with EPA
offices to initiate both outreach on policy and mandatory training. The agency
agreed, completed development of the scientific integrity training, and
administered the training to all EPA staff (with an ongoing requirement for all new
staff). As part of this effort, EPA Scientific Integrity program staff worked with the
agency's Office of Multimedia to create whiteboard training videos on scientific
integrity. The introductory video, "Scientific Integrity at EPA," won the award.
(Report Nos. ll-P-0386 and 13-P-0364)
• The EPA took various actions as a result of our audit on text messaging practices to
improve processes and eliminate business risks. Actions included publishing a new
records policy, issuing instructions on text messages, issuing instructions on
managing social media, holding a records management day, holding records
training and implementing training for Freedom of Information Act professionals.
(Report No. 17-P-0062)
• As a result of our work, and before our management alert report was issued, the
EPA contacted air monitoring agencies to determine the extent that monitoring
agencies may be inappropriately adjusting data based on the results of certain
quality control tests. The agency also initiated a review to assess whether certain
adjustments to ozone monitoring data could impact the EPA's determinations as to
whether air quality meets national ozone standards. (Report No. 17-P-0106)
• We made two recommendations to the Assistant Administrator for Administration
and Resources Management to monitor voluntary early retirement and voluntary
incentive payment authority activities still underway and determine the value of
those activities as a workforce tool. The office concurred with both
recommendations and completed corrective actions. (Report No. 17-P-0140)
30
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Projects Generated by Earlier OIG Work
Much of the important work that we do not only results in recommendations, but spurs us
to do additional work in similar areas, resulting in further findings. For example:
• In 2016, we issued a report noting that the EPA needs better data, plans and tools to
manage insect resistance to genetically engineered corn. We subsequently initiated
another project to assess the EPA's management and oversight of resistance issues
related to herbicide-tolerant genetically engineered crops. Our objectives are to
determine (1) what processes and practices, including alternatives, the EPA has
provided to delay herbicide resistance; (2) what steps the EPA has taken to
determine and validate the risk to human health and the environment for approved
pesticides to be used to combat herbicide resistant weeds; and (3) whether the EPA
independently collects and assesses data on, and mitigates actual occurrences of,
herbicide resistance in the field.
• We assessed that the risk of illegal, improper and erroneous purchases for the
EPA's purchase card and convenience check program was high enough to warrant
an audit because of noncompliance with existing internal controls. OMB Circular
A-123, Appendix B, prescribes policies and procedures to maintain internal
controls to reduce the risk of fraud, waste and error in the government charge card
program. As a result of this assessment, we decided to conduct a full audit of the
program in FY 2017, and the agency already has initiated actions to address the
instances of noncompliance noted.
• The Hazardous Waste Electronic Manifest Establishment Act of 2012 requires the
EPA OIG to conduct an annual audit of the financial statements of the electronic
manifest (e-Manifest) fund. As part of the mandatory audit, the EPA OIG
conducted an additional audit to determine whether EPA management complied
with applicable laws, regulations and agency guidance in the development of the
e-Manifest system. We found that the program and project managers assigned to
the e-Manifest system development project lacked the required acquisition
certifications necessary to oversee a major acquisition and information technology
investment, such as the e-Manifest system.
31
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Agency Best Practices Noted
During the semiannual reporting period, several reports that we issued highlighted agency
"best practices" of value to other components in the agency. Examples follow.
• The EPA's Office of Land and Emergency Management developed an electronic
laboratory data validation package—the Electronic Data Exchange and Evaluation
System—that is being made available to other agency programs via pilot
implementations. A new version of system is in the works, which will incorporate
added controls based on a current Contract Laboratory Program lab fraud case.
This demonstrates Office of Land and Emergency Management's view of the
Electronic Data Exchange and Evaluation System as a dynamic system that will be
periodically updated to reflect changes in the program. (Report No. 17-P-0119)
• The EPA has taken steps to implement the DATA Act. The EPA plans to go live in
May 2017 using partial data and a phased-in approach to comply with the key
legislative milestone. The EPA is following the OMB's and the U.S. Department of
the Treasury's eight-step DATA Act implementation strategy. The EPA has made
the following progress on these steps: (1) established a DATA Act work group with
the right mix of personnel needed to oversee implementation of the act,
(2) performed a review of the data elements and determined where the data will be
extracted in the EPA's systems, and (3) documented an initial inventory of EPA
data elements and systems against data elements. (Report No. 17-P-0050)
• The EPA took action during our audit to improve the purchase order process. The
EPA implemented guidance to provide a complete description of supplies and
services used. Further, the agency agreed to provide, and started providing, training
to its divisions and the regions. The agency also stated that it would continue the
activities of an annual Independent Verification and Validation Review and peer
reviews to periodically check for accuracy and completeness of the description of
requirement fields. (Report No. 17-P-0001)
32
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Statistical Data
Profile of Activities and Results
Audit and evaluation operations
OIG reviews
October 1, 2016-
March 31, 2017
($ in millions)
Questioned costs *
$0.07
Recommended efficiencies *
$7.06
Cost savings
$0.00
Costs disallowed to be recovered
$0.28
Costs disallowed as cost efficiency
$0.00
Reports issued by OIG
17
Reports resolved
(Agreement by agency officials
to take satisfactory corrective actions) *
6
Audit and evaluation operations
Reviews performed by Single Audit Act auditors
October 1, 2016-
March 31, 2017
($ in millions)
Questioned costs *
$0,075
Recommended efficiencies *
$0,000
Cost savings
$0,000
Costs disallowed to be recovered
$0,052
Costs disallowed as cost efficiency
$0,000
Single Audit Act reviews
148
Agency recoveries
$11.45
Recoveries from audit resolutions
of current and prior periods (cash collections
or offsets to future payments) ***
Investigative operations
($ in millions)
October 1, 2016-
March 31,2017
EPA OIG
only
Joint
Total
Criminal fines and recoveries
$0,000
$4,416
$4,416
Cost savings
$0.0008
$0.0097
$0.0105
Civil settlements
$0.0038
$1.0096
$1.0134
Administrative recoveries
$0,375
$0,000
$0,375
Cases opened during period
63
12
75
Cases closed during period
51
18
69
Indictments/informations of persons
1
7
8
or companies
Convictions of persons or companies
1
2
3
Civil judgments/settlements/filings
1
6
7
* Questioned costs and recommended efficiencies are subject to change pending further review in the audit resolution process.
** Reports resolved are subject to change pending further review.
*** Information on recoveries from audit resolutions is provided by the EPA's Office of Financial Management and is unaudited.
33
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Audit, Inspection and Evaluation Report Resolution
Table 1: OIG-issued reports with questioned costs for semiannual period ending March 31, 2017
($ in thousands)
Report category
No. of
reports
Questioned
costs *
Unsupported
costs
A. For which no management decision was made by
October 1, 2016**
16
$21.96
$21.60
B. New reports issued during period
2
0.07
0.07
Subtotals (A + B)
18
22.03
21.67
C. For which a management decision was made during the
reporting period:
6
6.75
6.70
(i) Dollar value of disallowed costs
2
0.07
6.68
(ii) Dollar value of costs not disallowed
4
6.68
0.02
D. For which no management decision was made by
March 31, 2017
12
6.28
3.58
* Questioned costs include unsupported costs.
** Any difference in number of reports and amounts of questioned costs between this report and our previous
semiannual report results from corrections made to data in our audit, inspection and evaluation tracking system.
Table 2: OIG-issued reports with recommendations that funds be put to better use for semiannual period
ending March 31, 2017 ($ in thousands)
Report Category
No. of
reports
Dollar
Value
A. For which no management decision was made by October 1, 2016 *
9
$154.06
B. Which were issued during the reporting period
2
0.07
Subtotals (A + B)
11
154.13
C. For which a management decision was made during the reporting period:
8
121.95
(i) Dollar value of recommendations from reports that were
agreed to by management
4
121.73
(ii) Dollar value of recommendations from reports that were
not agreed to by management
4
0.22
D. For which no management decision was made by March 31, 2017
3
17.33
* Any difference in number of reports and amounts of funds put to better use between this report and our previous
semiannual report results from corrections made to data in our audit, inspection and evaluation tracking system.
Audits, inspections and evaluations with no final action as of March 31, 2017, over 365 days past the date
of the accepted management decision (including audits, inspections and evaluations in appeal)
Audits, inspections and evaluations
Total
Percentage
Program
52
65
Assistance agreements
8
10
Single audits
15
19
Financial statement audits
5
63
Total
80
100
34
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Summary of Investigative Results
Summary of investigative activity during reporting period
Cases open as of October 1, 2016 *
207
Cases opened during period
75
Cases closed during period
69
Cases pending as of March 31, 2017
213
Complaints open as of October 1, 2016
37
Complaints opened during period
49
Complaints closed during period
59
Complaints pending as of March 31, 2017
27
* Adjusted from prior period.
Investigations pending by type as of March 31, 2017
Superfund
Management
Split funded
Recovery Act
CSB
Total
Contract fraud
6
10
9
2
0
27
Grant fraud
0
17
13
7
0
37
Laboratory fraud
2
4
1
0
0
7
Employee integrity
2
32
49
0
0
83
Program integrity
1
5
5
0
0
11
Computer crimes
0
4
3
0
0
7
Threat
6
9
7
1
0
23
Other
1
10
6
1
0
18
Total
18
91
93
11
0
213
Results of prosecutive actions
EPA OIG only
Joint *
Total
Criminal indictments/informations/complaints **
1
7
8
Convictions
1
2
3
Civil judgments/settlements/filings
1
6
7
Criminal fines and recoveries
$683
$4,415,147
$4,415,830
Civil recoveries
$3,800
$1,009,564
$1,013,364
Prison time
18 months
150 months
168 months
Prison time suspended
0 months
0 months
0 months
Home detention
0 months
0 months
0 months
Probation
66 months
36 months
102 months
Community service
0 hours
0 hours
0 hours
*With another federal agency.
** Sealed indictments are not included in this category.
35
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Semiannual Report to Congress October 1, 2016—March 31, 2017
Administrative actions
EPA OIG only
Joint *
Total
Suspensions
0
9
9
Debarments
0
27
27
Other administrative actions
41
15
56
Total
41
51
92
Administrative recoveries
$374,983
$0
$374,983
Cost avoidance
$796
$9,745
$10,541
*With another federal agency.
Summary of investigative reports issued and referrals *
Number of investigative reports issued
11
Number of persons referred to DOJ for criminal prosecution
31
Number of persons referred to state and local authorities for criminal prosecution
3
Number of criminal indictments and informations resulting from any prior referrals to
prosecutive authorities
8
* "Investigative reports" are comprised of final reports of investigation, final summary reports, interim reports of
investigation, and supplemental reports of investigation. In calculating the number of referrals, corporate entities were
counted as "persons.
Employee integrity cases*
Political
appointees
SES
GS-14/15
GS-13 and
below
Misc.
Total
Pending 10/1/16
1
9
32
56
5
103
Opened*
2
2
39
35
7
85
Closed*
0
2
8
16
0
26
Pending 3/31/17**
3
9
63
78
13
166
* Integrity investigation cases involve allegations of criminal activity or serious misconduct by agency employees that
could threaten the credibility of the agency, the validity of executive decisions, the security of personnel or business
information entrusted to the agency, or financial loss to the agency (such as abuse of government bank cards or theft
of agency funds). Allegations against former employees are included under "Miscellaneous." The chart below provides
the breakdown by grade and number of employees who are the subject of employee integrity investigations.
** Pending amounts as of 3/31/17 may not add up due to investigative developments resulting in subjects being
added or changed.
Breakdown, by Grade and Number of Employees, of Employee Integrity Cases
Political Appointees
¦ 13 and below
36
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Appendices
Appendix 1—Reports Issued
The Inspector General Act of 1978, as amended, requires a listing, subdivided according to subject matter, of each report issued by
the OIG during the reporting period. For each report, where applicable, the Inspector General Act also requires a listing of the dollar
value of questioned costs and the dollar value of recommendations that funds be put to better use.
Questioned Costs
Federal
Report No.
Report
Date
Ineligible Unsupported Unreasonable Recommended
Costs Costs Costs Efficiencies
PERFORMANCE REPORTS
17-P-0001
17-P-0004
17-P-0029
17-P-0044
17-P-0045
17-P-0050
17-P-0053
17-P-0062
17-P-0106
17-P-0113
17-P-0118
17-P-0119
17-P-0123
17-P-0124
17-P-0140
EPA's Purchase Order Process Needs to Improve and Achieve
Better Value
Management Alert: Drinking Water Contamination in Flint,
Michigan, Demonstrates a Need to Clarify EPA Authority to Issue
Emergency Orders to Protect the Public
Acquisition Certifications Needed for Managers Overseeing
Development of EPA's Electronic Manifest System
Improvements Needed in EPA's Information Security Program
CSB Has Effective Identify" and "Recover" Information Security
Functions, but Attention Is Needed in Other Information Security
Function Areas
Status of EPA's Implementation of the DATA Act
Additional Measures Can Be Taken to Prevent Deaths and Serious
Injuries From Residential Fumigations
Congressionally Requested Audit: EPA Needs to Improve
Processes for Preserving Text Messages as Federal Records
Management Alert: State, Local and Tribal Data Processing
Practices Could Impact Suitability of Data for 8-Hour Ozone
Air Quality Determinations
Risk for EPA's Fiscal Year 2016 Purchase Card and Convenience
Check Program Warrants an Audit
Backlog of Leaking Underground Storage Tank Cleanups in Indian
Country Has Been Reduced, but EPA Needs to Demonstrate
Compliance With Requirements
Fraud Controls for EPA's Contract Laboratory Program Are
Adequate, but Can Be Strengthened With Formal Risk Assessment
and Investigative Information Sharing
CSB Complied With Improper Payment Legislation Requirements
for Fiscal Year 2016
EPA Has Adequate Controls to Manage Advice From Science and
Research Federal Advisory Committees, but Transparency Could
Be Improved
EPA's 2014 Early-Out and Buyout Activities Aided Workforce
Restructuring Goals, and Continued Monitoring of Progress Can
Show Value of Restructuring
TOTAL PERFORMANCE REPORTS = 15
October 13,2016
October 20,2016
November 7, 2016
November 14, 2016
November 14, 2016
December 2, 2016
December 12, 2016
December 21, 2016
February 6, 2017
February 14, 2017
March 6,2017
March 6,2017
March 9,2017
March 13, 2017
March 23, 2017
$0
$0
$0
$1,184,000
0
0
0
0
0
0
0
0
0
0
$1,184,000
FINANCIAL AUDIT REPORTS
17-F-0046 EPA's Fiscal Years 2016 and 2015 Consolidated Financial November 15, 2016
Statements
17-F-0047 Audit of the U.S. Chemical Safety and Hazard Investigation Board's November 15, 2016
Fiscal Years 2016 and 2015 Financial Statements
TOTAL FINANCIAL AUDIT REPORTS = 2
SINGLE AUDIT REPORTS
17-S-0002 Terre Haute, Indiana, City of - FY 2014
17-S-0003 Westerville, Ohio, City of - FY 2014
17-S-0004 Door County, Wisconsin - FY 2014
17-S-0005 Ouzinkie, Alaska, Native Village of - FY 2015
17-S-0006 Union Sanitary District, California - FY 2015
17-S-0007 Dunsmuir, California, City of - FY 2014
October 11,2016
October 13,2016
October 21,2016
October 21,2016
October 25,2016
October 25,2016
0
$0
0
$0
0
$0
$3,500,000
0
$3,500,000
37
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Questioned Costs
Report No.
Report
Date
Ineligible
Costs
Unsupported
Costs
Unreasonable
Costs
Federal
Recommended
Efficiencies
17-S-0008 Sun'aq Tribe of Kodiak, Alaska -FY2015 October 25,2016 0
17-S-0009 Henning, Minnesota, City of— FY 2014 October 25,2016 0
17-S-0010 Sitka, Alaska, City & Borough-FY2015 October 25,2016 0
17-S-0011 Lansing, Michigan, City of-FY 2015 October 25,2016 0
17-S-0012 Bisbee, Arizona, City of-FY 2015 October 26,2016 0
17-S-0013 Wayne, Michigan, Charter County of-FY 2015 October 26,2016 0
17-S-0014 Genesee County Land Bank Authority, Michigan - FY 2015 October 26,2016 0
17-S-0015 Southern Illinois University, Illinois — FY 2015 October 26,2016 0
17-S-0016 Westchester, Illinois, Village of-FY 2015 October 26,2016 0
17-S-0017 Speedway, Indiana, Town of-FY 2014 October 26,2016 0
17-S-0018 Freeport, Illinois, City of-FY 2015 October 26,2016 0
17-S-0019 Wood Dale, Illinois, City of-FY 2015 October 26,2016 0
17-S-0020 Moore County, North Carolina - FY 2015 October 28,2016 0
17-S-0021 Belhaven, North Carolina, Town of-FY 2015 October 28,2016 0
17-S-0022 Franklin, North Carolina, Town of-FY 2015 October 28,2016 0
17-S-0023 Hillsborough, North Carolina, Town of— FY 2015 October 28,2016 0
17-S-0024 Hope Mills, North Carolina, Town of-FY 2015 October 28,2016 0
17-S-0025 Greenville, North Carolina, City of-FY 2015 October 28,2016 0
17-S-0026 Gregory, South Dakota, Municipality of-FYs 2013 and 201 November 2, 2016 0
17-S-0027 Grand Traverse Regional Land Conservancy, Michigan-FY 2015 November 3, 2016 0
17-S-0028 Onslow Water and Sewer Authority, North Carolina-FY 2015 November 3, 2016 0
17-S-0030 Newport, North Carolina, Town of-FY 2015 November 3, 2016 0
17-S-0031 Midland, North Carolina, Town of-FY 2015 November 3, 2016 0
17-S-0032 Kendall, Wisconsin, Village of-FY 2014 November 3,2016 0
17-S-0033 South Suburban Mayors/Managers Association, Illinois-FY 2013 November 3,2016 0
17-S-0034 Riverdale, Illinois, Village of-FY 2015 November 4,2016 0
17-S-0035 Leyden, Illinois, Township of-FY 2015 November 4,2016 0
17-S-0036 Carlock, Illinois, Village of-FY 2015 November 4,2016 0
17-S-0037 Akiak Native Community, Alaska-FY2014 November 4, 2016 0
17-S-0038 Larkspur, Colorado, Town of - FY 2014 November 4, 2016 0
17-S-0039 Nye County, Nevada - FY 2015 November 7,2016 0
17-S-0040 Missouri System, Missouri, University of-FY 2015 November 7, 2016 0
17-S-0041 Columbus, Nebraska, City of-FY 2015 November 8,2016 0
17-S-0042 Gretna, Nebraska, City of-FY 2015 November 8,2016 0
17-S-0043 Sauk Village, Illinois, Village of-FY 2015 November 8, 2016 0
17-S-0048 Clarkson University, Nevada-FY 2015 November 17,2016 0
17-S-0049 Fort Madison, Iowa, City of-FY 2015 November 21,2016 0
17-S-0051 Girard, Kansas, City of-FY 2014 December 7,2016 0
17-S-0052 Habematolel Pomo of Upper Lake, California-FY 2014 December 8, 2016 0
17-S-0054 Downriver Community Conference, Michigan - FY 2015 December 8, 2016 0
17-S-0055 Franklin, Illinois, Village of — FY 2015 December 9,2016 0
17-S-0056 Lorain, Ohio, City of-FY 2014 December 9,2016 0
17-S-0057 Jourdanton, Texas, City of-FY 2014 December 13,2016 0
17-S-0058 Mapleton, Minnesota, City of-FY 2014 December 13,2016 0
17-S-0059 Oak Creek, Wisconsin, City of-FY 2014 December 13, 2016 0
17-S-0060 Fox Lake, Illinois, Village of-FY 2015 December 13,2016 0
17-S-0061 Florida Rural Water Association Inc., Florida-FY 2015 December 21, 2016 0
17-S-0063 McCaysville, Georgia, City of— FY 2015 December 21,2016 0
17-S-0064 Murray, Kentucky, City of - FY 2015 December 21,2016 0
17-S-0065 Surgoinsville, Tennessee, Town of-FY 2015 December 21, 2016 0
17-S-0066 Hancock County, Tennessee - FY 2015 December 21, 2016 0
17-S-0067 Campbell County, Tennessee - FY 2015 December 21, 2016 0
17-S-0068 Helena, Alabama, Utilities Board of the City of-FY 2015 December 21, 2016 0
17-S-0069 Jones County, Georgia - FY 2015 December 22,2016 0
17-S-0070 Lexington-Fayette Urban County Government, Kentucky - FY 2015 December 22, 2016 0
17-S-0071 Barbourville Utility Commission, Kentucky — FY 2015 December 22, 2016 0
17-S-0072 Frankfort Electric & Water Power Board, Kentucky-FY 2015 December 22, 2016 0
17-S-0073 White House, Tennessee, City of - FY 2015 December 22, 2016 0
17-S-0074 Bend, Oregon, City of - FY 2015 December 23,2016 0
17-S-0075 Cottage Grove, Wisconsin, Village of -FY 2014 December 23, 2016 0
17-S-0076 Dallas, Wisconsin, Village of-FY 2014 December 23,2016 0
17-S-0077 Hart County Water and Sewer Authority, Georgia - FY 2015 December 23, 2016 0
17-S-0078 Canton, Georgia, City of - FY 2015 December 23,2016 0
17-S-0079 Cornelius, Oregon, City of-FY 2015 December 28,2016 0
17-S-0080 Newberg, Oregon, City of-FY 2015 December 28,2016 0
17-S-0081 Harper Woods, Michigan, City of-FY 2014 December 28, 2016 0
38
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Questioned Costs Federal
Ineligible
Unsupported
Unreasonable
Recommended
Report No.
Report
Date
Costs
Costs
Costs
Efficiencies
17-S-0082
Kenyon, Minnesota, City of- FY 2014
December 28, 2016
0
0
0
0
17-S-0083
Allendale County, South Carolina - FY 2015
December 28, 2016
0
0
0
0
17-S-0084
Joplin, Missouri, City of- FY 2015
December 29, 2016
0
0
0
0
17-S-0085
Georgetown, Delaware, Town of-FY 2015
December 30, 2016
0
0
0
0
17-S-0086
Waverly, Nebraska, City of - FY 2015
December 30, 2016
0
0
0
0
17-S-0087
Cottondale, Florida, City of - FY 2014
December 30, 2016
0
0
0
0
17-S-0088
Kings Mountain, North Carolina, City of - FY 2015
December 30, 2016
0
0
0
0
17-S-0089
Yadkin Valley Sewer Authority, North Carolina - FY 2015
December 30, 2016
0
0
0
0
17-S-0090
Kinston, North Carolina, City of - FY 2015
December 30, 2016
0
0
0
0
17-S-0091
Greenville Rancheria, California- FY 2014
January 10,2017
0
67,073
0
0
17-S-0092
Chesapeake Beach, Maryland, Town of — FY 2015
January 24,2017
0
0
0
0
17-S-0093
Johnstown, Pennsylvania, City of - FY 2015
January 24,2017
0
0
0
0
17-S-0094
Dorchester, Nebraska, Village of- FY 2015
January 24,2017
0
0
0
0
17-S-0095
Olney Springs, Colorado, Town of - FY 2014
January 24,2017
0
0
0
0
17-S-0096
Blue Lake Rancheria Tribe, California - FY 2014
January 24,2017
0
0
0
0
17-S-0097
Huntington Park, California, City of- FY 2015
January 24,2017
0
0
0
0
17-S-0098
Yukon River Inter-Tribal Watershed Council, Alaska - FY 2015
January 24,2017
0
0
0
0
17-S-0099
Douglas, Nebraska, County of - FY 2015
January 25,2017
0
0
0
0
17-S-0100
Garland, Nebraska, Village of - FY 2015
January 25,2017
0
0
0
0
17-S-0101
Greenville, Mississippi, City of- FY 2015
January 27,2017
0
0
0
0
17-S-0102
Batesville, Mississippi, City of- FY 2015
January 27,2017
0
0
0
0
17-S-0103
Tallapoosa, Georgia, City of - FY 2015
January 27,2017
0
0
0
0
17-S-0104
Moultrie, Georgia, City of - FY 2015
January 27,2017
0
0
0
0
17-S-0105
Research Triangle Institute, North Carolina - FY 2015
January 30,2017
0
0
0
0
17-S-0107
Woodland-Davis Clean Water Agency - FY 2015
February 7, 2017
0
0
0
0
17-S-0108
Buckeye, Arizona, City of - 2015
February 8, 2017
0
0
0
0
17-S-0109
Dunsmuir, California, City of - FY 2015
February 8, 2017
0
0
0
0
17-S-0110
Pit River Tribe, California - FY 2014
February 10, 2017
0
0
0
0
17-S-0111
Southern California, University of - FY 2015
February 10, 2017
0
0
0
0
17-S-0112
Big Park Domestic Waste Water Improve. Dist., Arizona - FY 2015
February 10, 2017
0
0
0
0
17-S-0114
Maui, County of, Hawaii - FY 2015
February 16, 2017
0
0
0
0
17-S-0115
Anaconda-Deer Lodge County, Montana - FY 2015
February 23, 2017
0
0
0
0
17-S-0116
South Adams County Water & Sanitation Dist., Colorado - FY 2015
February 28, 2017
0
0
0
0
17-S-0117
Paonia, Colorado, Town of - FY 2015
February 28, 2017
0
0
0
0
17-S-0120
Colorado Rural Water Association, Colorado-FY 2015
March 6,2017
0
0
0
0
17-S-0121
Left Hand Water District, Colorado - FY 2015
March 7,2017
0
0
0
0
17-S-0122
Elmwood Park, Illinois, Village of-FY 2015
March 7,2017
0
0
0
0
17-S-0125
Monroe, Louisiana, City of - FY 2015
March 13, 2017
0
0
0
0
17-S-0126
Laurel, Mississippi, City of- FY 2015
March 13, 2017
0
0
0
0
17-S-0127
Oakland County, Michigan - FY 2015
March 15, 2017
0
0
0
0
17-S-0128
Montcalm County, Michigan - FY 2015
March 15, 2017
0
0
0
0
17-S-0129
Detroit/Wayne County Port Authority, Michigan - FY 2015
March 15, 2017
0
0
0
0
17-S-0130
Pueblo De San lldefonso, New Mexico - FY 2015
March 16, 2017
0
0
0
0
17-S-0131
Portales, New Mexico, City of - FY 2015
March 15, 2017
0
0
0
0
17-S-0132
Livonia, Michigan, City of- FY 2015
March 20, 2017
0
0
0
0
17-S-0133
Elbow Lake, Minnesota, City of - FY 2015
March 20, 2017
0
0
0
0
17-S-0134
Camden, New Jersey, City of- FY 2015
March 20, 2017
0
0
0
0
17-S-0135
Rochester New York, University of- FY 2015
March 20, 2017
0
0
0
0
17-S-0136
Illinois, University of-FY 2015
March 20, 2017
0
0
0
0
17-S-0137
Shasta Valley Resource Conservation District, California - FY 2014
March 21,2017
0
0
0
0
17-S-0138
Globe, Arizona, City of - FY 2015
March 21,2017
0
0
0
0
17-S-0139
Lyon County Nevada - FY 2015
March 21,2017
0
0
0
0
17-S-0141
Herman, Minnesota, City of - FY 2015
March 21,2017
0
0
0
0
17-S-0142
Chicago Park District, Illinois - FY 2015
March 21,2017
0
0
0
0
17-S-0143
Big Valley Rancheria Band of Pomo Indians, California - FY 2014
March 21,2017
7,433
0
0
0
17-S-0144
Morrison, Illinois, City of- FY 2016
March 21,2017
0
0
0
0
17-S-0145
Burlington Water District, Oregon - FY 2015
March 22, 2017
0
0
0
0
17-S-0146
Kansas City Board of Public Utilities, Kansas - FY 2015
March 22, 2017
0
0
0
0
17-S-0147
Ingham County, Michigan - FY 2015
March 24, 2017
0
0
0
0
17-S-0148
Macomb County, Michigan - FY 2015
March 24, 2017
0
0
0
0
17-S-0149
Annadale, Minnesota, City of- FY 2015
March 24, 2017
0
0
0
0
17-S-0150
Logansport, Indiana, City of- FY 2014
March 28, 2017
0
0
0
0
17-S-0151
Floyds Knobs Water Company Inc., Indiana - FY 2015
March 28, 2017
0
0
0
0
17-S-0152
San Pablo, California, City of- FY 2015
March 29, 2017
0
0
0
0
17-S-0153
Santa Barbara, California, City of- FY 2015
March 29, 2017
0
0
0
0
17-S-0154
Arecibo, Puerto Rico, Municipality of - FY 2015
March 30, 2017
0
0
0
0
39
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Questioned Costs Federal
Ineligible
Unsupported
Unreasonable
Recommended
Report No.
Report
Date
Costs
Costs
Costs
Efficiencies
17-S-0155
London, Kentucky, City of - FY 2015
March 30, 2017
0
0
0
0
17-S-0156
Greenwood, Mississippi, City of - FY 2015
March 30, 2017
0
0
0
0
17-S-0157
West Point, Mississippi, City of- FY 2015
March 30, 2017
0
0
0
0
17-S-0158
North Miami Beach, Florida, City of - FY 2015
March 30, 2017
0
0
0
0
17-S-0159
Calhoun, Georgia, City of- FY 2015
March 30, 2017
0
0
0
0
17-S-0160
Richmond Hill, Georgia, City of- FY 2015
March 30, 2017
0
0
0
0
17-S-0161
Bunnell, Florida, City of- FY 2015
March 30, 2017
0
0
0
0
17-S-0162
Monroe County, Georgia - FY 2015
March 30, 2017
0
0
0
0
17-S-0163
Montgomery County, North Carolina - FY 2015
March 30, 2017
0
0
0
0
17-S-0164
Greene County, North Carolina - FY 2015
March 30, 2017
0
0
0
0
TOTAL SINGLE AUDIT REPORTS = 148
$7,433
$67,073
$0
$0
TOTAL REPORTS ISSUED = 165
$7,433
$67,073
$0
$4,684,000
40
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Appendix 2—Reports Issued Without Management Decisions
or Comment
For Reporting Period Ended March 31, 2017
Section 5(a)(10)(B) of the Inspector General Act of 1978, as amended, requires a summary of each audit, inspection
and evaluation report issued during the reporting period for which no establishment comment was returned within
60 days of providing the report to the establishment. The literal language of Section 5(a)(10)(B) requests the OIG to
track reports issued prior to commencement of the reporting period. However, given that this provision was intended
to codify the February 27, 2015, semiannual requests from Senators Grassley and Johnson, the OIG interprets this
provision to apply to reports within the semiannual period. There were no reports for which we did not receive a
response within 60 days during the semiannual period.
Section 5(a)(10)(A) of the Inspector General Act of 1978, as amended, requires a summary of each audit, inspection
and evaluation 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 and evaluations 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 as of
March 31, 2017.
Office of Administration and Resources Management
Report No. 16-P-0135, EPA Should Timely Deobligate Unneeded Contract, Purchase and Miscellaneous
Funds, April 11,2016
Summary: The EPA did not deobligate $583,875 from contract, purchase and miscellaneous obligations that had
no activity in the last 18 months. Further, we estimated there could be an additional $2,962,058 that could be
deobligated. EPA guidance requires deobligating inactive obligations without any activity for 6 months or more.
Further, federal and agency guidance requires unliquidated obligations to be reviewed at least annually. However,
EPA personnel did not adequately review or monitor outstanding obligations to ensure amounts remaining were valid.
Consequently, the EPA was unable to reprogram unneeded funds to other environmental activities that could result in
benefits for human health and the environment.
Agency Explanation: A certification of completion memo certifying the completion of all recommendations cited in the
OIG report was submitted on April 5, 2017.
Office of Chemical Safety and Pollution Prevention
Report No. 16-F-0322, Fiscal Years 2014 and 2013 Financial Statements for the Pesticides Reregistration and
Expedited Processing Fund, September 22, 2016
Summary: We rendered a disclaimer of opinion on the Pesticides Reregistration and Expedited Processing Fund
financial statements for FY 2014, meaning that we were unable to obtain sufficient evidence to determine if they were
fairly presented and free of material misstatement. We noted a material weakness in that the EPA could not
adequately support $34 million of its FY 2014 fund costs. In FY 2014, the EPA allocated its pesticide funding to use
appropriated amounts, which would expire, and retained funding received from fees. Therefore, significant payroll
amounts paid from appropriations were not charged directly to the fund or other pesticide programs. This resulted in
the loss of the audit trail for reporting separate costs and liabilities for the fund and other pesticide programs. In
FY 2014, the EPA chose to significantly exceed the statutory target set out in the fund. The agency agreed with our
recommendation, and in October 2015 eliminated the practice of averaging to offset over- or under-collection of
maintenance fees from previous years. The agency plans to set the per product maintenance fee at an amount
designed to collect the target amount of fees authorized by Congress. The recommendation will remain open until we
can confirm FY 2016 maintenance fee collections.
Agency Explanation: The OIG follow-up audit started in September 2016. Confirmation of FY 2016 maintenance fee
collection is ongoing.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Office of Grants and Debarment
Report No. 13-P-0341, Lead Remediation Association of America, August 6, 2013
Summary: The OIG found that the Lead Remediation Association of America's financial management system did not
meet the standards established under the Code of Federal Regulations. The association's accounting system data
were not updated timely, the association made cash draws and submitted its final federal financial report using the
grant budget amounts rather than actual costs incurred, and the association did not maintain source documentation
to support the costs incurred or claimed as required. The OIG also found that the association did not meet grant
objectives. As of the date of our report—2 years after the grant period end date of June 30, 2011—the association
had not produced the required DVDs, provided evidence of brochure distribution, or completed required training and
workshops. The OIG questioned the $249,870 claimed and recommended recovery of the $249,882 drawn.
Agency Explanation: The Lead Remediation Association of America appealed the agency's initial decision, but did not
appeal the Dispute Decision Official decision requiring it to reimburse the EPA $249,420. In resolution of the audit,
the association was able to offset unallowed costs with other acceptable incurred expenses totaling $208,264 and
has been billed for the remaining $41,156. Before the recipient receives another grant award from the EPA, it is to
complete the mandatory online non-profit grant training, as well as undergo a pre-award certification review to ensure
that all of their administrative and financial management systems are in compliance with federal regulations.
Report No. 16-S-0291, Alliance to Save Energy, District of Columbia - FY 2014, August 24, 2016
Summary: The Alliance to Save Energy conducts activities under agreements for which the resource provider does
not receive commensurate benefits, and for which the related revenue should be accounted for as a contribution
transaction; these agreements have been accounted for as exchange transactions. The alliance's lease agreements
for offices in Washington, D.C., were not sufficiently analyzed to determine the appropriate accounting for leasehold
improvements and deferred lease incentives. The same individual responsible for receiving payments is also
responsible for recording the payments in the general ledger and for making physical bank deposits, and the general
ledger entries are not reviewed and approved before being posted. Employees were reimbursed for credit card
charges even when receipts or other evidence justifying the expenses were not provided. General journal (adjusting)
entries were posted to the general ledger during the year without evidence of proper review and approval.
Agency Explanation: The Office of Grants and Debarment has reached out to the recipient and is awaiting a copy of
the recipient's corrective action plan, as well as other documentation that supports resolution of this financial
statement finding. The Office of Grants and Debarment is requesting an extension of May 31, 2017, to resolve this
audit.
Region 7—Regional Administrator
Report No. 16-S-0151, Nebraska, State of - FY 2015, April 27, 2016
Summary: As part of the calendar year 2014 attestation examination, the single auditor noted that the agency did not
maintain adequate documentation to support federal charges for employees. During the calendar year 2014
attestation of the agency, the single auditor noted multiple federal issues with payroll allocation. The single auditor
questioned $59,868, which included $18,751 for the EPA assistance agreement Performance Partnership Grants.
Questioned costs noted were for salaries only; related employee benefits, including health insurance and retirement,
were not included in these totals but would also be unallowable. Some employees documented leave used only;
some coded all of their time to general administrative work codes that did not reflect the split between federal and
state programs; and other employees simply coded fewer hours to the grants than what were actually being charged.
Agency Explanation: Region 7 has reviewed the actions taken by the U.S. Department of Agriculture to address this
finding. The department does have a system in place to document employee time by project/activity. However, as the
auditors noted, three staff members who worked a portion of their time on pesticides enforcement coded their time to
an incorrect code. Corrective actions were taken and work documentation used to substantiate the charges to the
EPA. The management decision letter will be issued upon receipt of the 2016 state of Nebraska single audit report
and review of prior period findings to ensure corrective actions have been properly implemented.
42
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Region 8—Regional Administrator
Report No. 12-1-0560, Cheyenne River Sioux Tribe, September 24, 2007
Summary: The tribe did not comply with the financial and program management standards under the CFR and
OMB Circular A-87. We questioned $3,101,827 of the $3,736,560 in outlays reported. The tribe's internal controls
were not sufficient to ensure that outlays reported complied with federal cost principles, regulations and grant
conditions. In some instances, the tribe also was not able to demonstrate that it had completed all work under the
agreements and had achieved the intended results.
Agency Explanation: Region 8 addressed the OIG audit with the Cheyenne River Sioux Tribe, completed follow-up
evaluations and studies, and has determined that while the tribe was out of compliance with the administrative
requirements identified in the OIG's report, there was ample evidence that the underlying work was satisfactorily
completed and the overall harm to the federal government was negligible. However, the tribe's underlying policies
and procedures that allowed these compliance issues to arise have not yet been updated and, therefore, the risk of
recurring noncompliance is high. As a result, Region 8 has placed the tribe under a "high risk" status, provided
training to department and financial staff, and reviews the supporting documentation for all expenditures reimbursed,
and will continue to do so, until the tribe has (1) updated and implemented policies and procedures that will address
the systematic issues identified by the OIG and (2) demonstrated compliance in an agency's review of its future
single audits. Region 8 is in communication with the tribe and is awaiting the publication of its FYs 2014 and 2015
single audits. Once published, the EPA indicated that it will be working with the tribe, its cognizant agency (the
U.S. Department of the Interior) and other applicable agencies to understand and resolve any outstanding systematic
issues, provide training, and jointly develop a monitoring system that will provide tribal leaders and federal agencies
assurances that compliance requirements are understood and put into practice. Region 8 indicated that once the tribe
has demonstrated the ability to take these steps, the region plans to request a regulatory waiver of the identified
compliance issues. Region 8 indicated its examination revealed no fraud, waste or abuse, and that noncompliances
were a result of administrative issues rather than problems with completing objectives of the agreements.
Report No. 16-S-0153, Montana, State of - FYs 2014 and 2015, April 26, 2016
Summary: The Department of Environmental Quality provides low interest loans to local governments and
communities for water pollution control and drinking water projects through the Clean Water State Revolving Fund
and Drinking Water State Revolving Fund programs. During the audit, the single auditor noted that the department
had not submitted Federal Funding Accountability and Transparency Act reports for its loans for either fund. Also, for
funds provided to Montana State University-Bozeman, a fiscal manager review of expenses charged to research and
development grant funds was not consistently documented during the audit period. Further, the University of
Montana-Missoula's Office of Research Sponsored Programs represented that grant expenditure reports, both
summary and detail, were run monthly and reviewed at least quarterly by grant accountants, but the single auditor
could not confirm from inspection of various grant files whether the reviews actually had been performed.
Agency Explanation: The state's Department of Environmental Quality has consistently reported to the EPA's Public
Benefits Reporting system the information required by the Federal Funding Accountability and Transparency Act;
however, during the audit, the department discovered that the Public Benefits Reporting system was not importing the
data to the Federal Funding Accountability and Transparency Act system as expected. The department worked with
the EPA to resolve the data incompatibility issues between the two federal systems without success. At that time, the
department decided to manually update the required data into the Federal Funding Accountability and Transparency
Act system. Both the Drinking Water and Clean Water Revolving Fund loan programs are now current with the
Federal Funding Accountability and Transparency Act reporting process. The report is expected to be closed by
April 25, 2017.
Report No. 16-S-0182, Denver Urban Renewal Authority, Colorado - FY 2014, May 19, 2016
Summary: The auditors tested two quarterly reports and found that certain information in the reports was inaccurate
when reported to the EPA. The authority failed to report under the Federal Financial Assistance Transparency Act or
register in the Federal Subaward Reporting System in the month following when the grant obligation was made.
Agency Explanation: The agency indicated it discussed these issues, including the corrective actions, with the Denver
Urban Renewal Authority in March 2015, before the audit was finalized. In regard to finding 2014-001, related to
inaccurate information in two of the quarterly reports submitted to the EPA, the auditor noted that both reports were
corrected in the next quarterly cumulative report. The auditor recommended that a detailed review of the reports be
performed by someone other than the preparer prior to the reports being submitted. As stated in their response to the
auditor, "the Authority has processes in place and will enhance existing processes to ensure that a detailed review
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
including agreeing amounts and other information reported to supporting documentation and reconciliation to cash
draw schedules will be performed by management other than the preparer prior to the submission of reports to the
Environmental Protection Agency. Additionally, evidence of this detailed review will be maintained with the supporting
documents used to prepare the report." In regard to finding 2014-002 related to the subrecipient's registering and
reporting in the Federal Financial Assistance Transparency Act, the authority agreed with the finding and registered in
the Federal Subaward Reporting System.
Region 9—Regional Administrator
Report No. 13-3-0159, Summit Lake Paiute Tribe, Nevada - FY 2010, February 19, 2013
Summary: The tribe did not file or maintain documentation of compliance for annual reports. Also, the required
SF 425 report did not cover the correct period. A similar finding was noted in the prior year audit report. The tribe
recorded deferred revenues in the amount of $804,104 and only $150,416 in available cash. The single auditor
questioned $653,688. A similar finding was noted in the prior year audit report. The tribe's operating practices did not
reflect the processes described in the approved policies and procedures manual. The tribe did not properly reconcile
its SF 425 report to the general ledger for certain awards and the single auditor questioned $20,556. The single
auditor also questioned $76,216 involving amounts paid to the General Assistance Program Director.
Agency Explanation: Region 9 is addressing five audits with Summit Lake—one agreed-upon procedures audit and
four single audits. Summit Lake appealed the agreed-upon procedures audit and the Regional Administrator
accepted the appeal on August 13, 2014. A Debt Forgiveness Package was received from the tribe requesting that
EPA forgive the $74,418 owed as a result of the OIG's agreed-upon procedures review. As of January 4, 2017, the
Deputy Associate General Counsel and acting Claims Officers authorized the write-off of the debt and any applicable
interest, handling and penalty costs pursuant to 40 CFR 13.32(a). Region 9 is working with the tribe to address all
four single audits.
Report No. 13-3-0160, Summit Lake Paiute Tribe, Nevada - FY 2011, February 19, 2013
Summary: The tribe did not file the quarterly narratives for the General Assistance Program. Furthermore, the tribe
was unable to locate documentation for two quarterly SF 425 reports. There were no formalized controls regarding
the security of the payroll stamp. Also, the single auditor noted issues related to pay rates. A similar finding was noted
in the prior year audit report. Budgets prepared excluded the carry-forward amounts from prior periods. Several
transactions were not supported by a purchase order or other type of approval prior to the expenditure being made.
One transaction charged to travel in the amount of $2,877 did not appear to be valid and appropriate for the granting
requirements, and the single auditors questioned that amount.
Agency Explanation: Region 9 is addressing five audits with Summit Lake—one agreed-upon procedures audit and
four single audits. Summit Lake appealed the agreed-upon procedures audit and the Regional Administrator
accepted the appeal on August 13, 2014. A Debt Forgiveness Package was received from the tribe requesting that
EPA forgive the $74,418 owed as a result of the OIG's agreed-upon procedures review. As of January 4, 2017, the
Deputy Associate General Counsel and acting Claims Officers authorized the write-off of the debt and any applicable
interest, handling and penalty costs pursuant to 40 CFR 13.32(a). Region 9 is working with the tribe to address all
four single audits.
Report No. 14-3-0248, City of Richmond, California - FY 2012, May 8, 2014
Summary: The review found that the Schedule of Expenditures of Federal Awards initially provided for audit was
materially misstated, and the prior year schedule did not include expenditures for all prior year programs. As the
single auditors began tracing the reported amounts to supporting documentation and comparing the grants listed to
the prior year schedule, the single auditors noted a number of material discrepancies. One of the significant errors
noted on the original schedule pertained to the Brownfield Assessment and Cleanup Cooperative Agreements, which
was included with expenditures of $262,000; it was discovered that expenditures for FY 2011 had not been included
in the prior year schedule and expenditures for FYs 2011 and 2012 of $906,000 were subsequently reported on the
schedule. The single auditors also noted that expenditures for the Brownfield Revolving Loan Fund Cooperative
Agreement and Brownfield Cleanup Cooperative Agreement were incurred after the grant project periods. Also, the
city did not provide documentation to demonstrate compliance with the grant's Quality Assurance Plan requirements.
On May 5, 2014, the OIG reviewed grant information. The city made four drawdowns totaling $600,000 (project cost)
after the budget and project end dates, but the OIG questioned the $600,000 as unsupported.
Agency Explanation: The two grants questioned in the single audit were awarded to the Richmond Community
Redevelopment Agency and not the city of Richmond. The Richmond Community Redevelopment Agency is no
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
longer in existence. Region 9 has requested that the OIG review this single audit and provide guidance on resolution
since one of these grants—city of Richmond—is not the successor in interest.
Region 10—Regional Administrator
Report No. 16-S-0326, Gambell, Alaska, Native Village of - FY 2013, September 22, 2016
Summary: The single auditor included a "going-concern" emphasis-of-matter paragraph in the audit report. Four
findings were reported, and we had concerns with $27,179 in questioned costs. The single audit report was filed over
2 years late and all findings were repeat findings from the prior years. Due to the severity of the findings and the
going concern issue reported by the single auditor, and their adverse impact upon the Native Village of Gambell's
accounting system and management of funds, we recommended that the EPA consider applying specific grant
conditions, in accordance with 2 CFR § 200.207. Also, we recommended that the EPA input these findings into the
Grantee Compliance Database and consider this information as a part of future pre-award decisions.
Agency Explanation: Region 10 is addressing the four audit findings and $27,179 in questioned costs. The Native
Village of Gambell did not meet the response deadline for submission of requested documentation related to this
audit. In accordance with 40 CFR § 31.43, the region likely will initiate one or more enforcement actions and require
special conditions as detailed in 2 CFR § 200.207, particularly as it relates to any future awards. All relevant
documentation has been and will be entered into the Grantee Compliance Database.
Total reports issued before reporting period for which
no management decision had been made as of March 31, 2017 = 12
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Appendix 3—Reports With Corrective Action Not Completed
In compliance with reporting requirements of Sections 5(a)(3) and 5(a)(10)(C) of the Inspector General Act of 1978, as amended, we
are to identify each significant recommendation described in previous semiannual reports on which corrective action has not been
completed, and provide a summary of each audit, inspection and evaluation report for which there are any outstanding unimplemented
recommendations. We are also to identify the aggregate potential cost savings of the unimplemented recommendations.
This appendix contains separate tables of unimplemented recommendations for the EPA and CSB. The tables are further divided by:
(1) recommendations with past due corrective actions and (2) recommendations with corrective actions that have a future completion
date. Many of the recommendations have completion dates in the future due to the complexity or challenging nature of the
recommendations.
There is a total potential cost savings of $103.33 million for the current open and unimplemented recommendations for the EPA, of
which $13.00 million was sustained by the agency. Sustained cost is the dollar value of questioned costs, recommended efficiencies or
cost savings identified by the OIG during an audit/evaluation and agreed to in whole or in part by the agency. Once the agency sustains
a recommendation and any dollar value associated with the recommendation, the agency then moves to recover the money. There
were $0.40 million cost savings for the CSB. The recommendations that would result in cost savings are shown in the tables of
unimplemented recommendations.
Below is a listing of the responsible EPA offices that have recommendations included in the following tables. While a recommendation
may be listed as unimplemented, the agency may be on track to complete agreed-upon corrective actions by the planned due date.
A reason for delay is only shown for those recommendations that are past their original planned completion date. The information
regarding reason for delay was provided by the agency and was not verified by the OIG.
Responsible EPA Offices:
OA Office of the Administrator
OAR Office of Air and Radiation
OARM Office of Administration and Resources Management
OCFO Office of the Chief Financial Officer
OCSPP Office of Chemical Safety and Pollution Prevention
OECA Office of Enforcement and Compliance Assurance
OGD Office of Grants and Debarment
OEI Office of Environmental Information
OLEM Office of Land and Emergency Management
OW Office of Water
Region 2
Region 4
Region 6
Region 7
Region 8
Region 9
46
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Semiannual Report to Congress October 1, 2016—March 31, 2017
EPA Reports With Past Due Unimplemented Recommendations
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
Religious Compensatory
Time Is Subject to Abuse
16-P-0333
09/27/16
OARM
3. Develop training on the proper
use of Religious Compensatory
Time and require all managers
approving, and employees using,
Religious Compensatory Time to
complete the course.
3/31/17
$0
$0
OARM is providing a training
session on the policy, scheduled
for 4/27/17.
Progress Made but
Improvements Needed at
CTS of Asheville
Superfund Site in North
Carolina to Advance
Cleanup Pace and
Reduce Potential
Exposure
16-P-0296
08/31/16
Region 4
9. Include an updated table of
Projected Future Activities and
Schedules with each community
update.
10. Close out the site-specific
on-scene coordinator web page
by adding information on the
site's Superfund status, updating
the contact information, and
providing a link to the Superfund
Site Profile web page where new
information will be posted.
11. Add documents to the EPA's
Superfund Site Profile web page
for the site, including:
a. Status of removal and
remedial activities.
b. The 2016 community
involvement plan and
community updates.
c. Frequently requested
documents, including recent
and historical work plans,
sampling schedules, result
reports and action plans.
d. Pollution reports for removal
actions conducted since 2012
and a link to older reports on
the on-scene coordinator web
page.
e. Administrative records for
removal and remedial actions.
f. Other site documents as
appropriate to support removal
and remedial site actions and
activities.
03/31/17
12/31/16
12/31/16
$0
$0
EPA Regional Offices
Need to More
Consistently Conduct
Required Annual
Reviews of Clean Water
State Revolving Funds
16-P-0222
07/7/16
OW
8. Evaluate regional approaches
to conducting the annual reviews
of Clean Water State Revolving
Fund programs, and address
issues to ensure regions perform
consistent reviews in accordance
with the annual review guidance.
09/30/16
$0
$0
In 2017, EPA headquarters
Clean Water State Revolving
Fund participated in four State
annual reviews and plans to
continue this practice in future
years.
47
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
EPA Region 9 Needs to
Improve Oversight Over
Guam's Consolidated
Cooperative Agreements
16-P-0166
05/09/16
Region 9
1. Work with the recipient, the
Guam Legislature, and if
necessary the U.S. Congress, to
enforce the utilization of all
program income funds, as
specified by 40 CFR Part 31 and
the Consolidated Cooperative
Agreement. If control of the
program income funds are not
returned to Guam Environmental
Protection Agency, EPA should:
(1) temporarily withhold cash
payments; (2) partly suspend or
terminate the current award; or
(3) withhold future awards.
09/30/16
A new proposed corrective action
date is 9/30/17. Recipient is in
the process of drafting legislation
to remedy the situation.
2. Verify the program income
received by the Guam
Legislature for Guam
Environmental Protection
Agency-generated activities from
2010 to when the Guam
Legislature relinquishes control.
Take appropriate action to
recover program income funding
still controlled by the Guam
Legislature up to $2,015,719.
09/30/16
$2,015
$0
A new proposed corrective action
date is 9/30/17. Recipient has not
provided audited records for the
accounts in question.
17. Train the Guam
Environmental Protection Agency
Safe Drinking Water Information
System administrator and cross-
train Guam Environmental
Protection Agency staff in Safe
Drinking Water Information
System administrator duties.
09/30/16
A new proposed corrective action
date is 9/30/17. Recipient has not
yet hired a qualified
individual to run the Safe
Drinking Water Information
System at General Education
Provision Act.
18. Verify Guam Environmental
Protection Agency Safe Drinking
Water Information System data
accuracy and completeness.
09/30/2016
A new proposed corrective action
date is 9/30//17. Recipient has
not provided data to the EPA to
enable verification.
Clean Air Act Facility
Evaluations Are
Conducted, but
Inaccurate Data May
Hinder EPA Oversight
and Public Awareness
16-P-0164
05/03/16
Region 8
2. Ensure that the Integrated
Compliance Information System-
Air database is updated to reflect
the correct source classification,
operational status and Full
Compliance Evaluations for
facilities within the assignments
scope, including facilities initially
identified as Clean Air Act major
operating facilities.
10/01/16
$0
$0
There is a total of 10 facilities that
need to be researched and
corrected. Originally expected to
be completed by 12/31/16, the
Texas Commission on
Environmental Quality's project to
send its Clean Air Act data via
electronic data transmission has
not been completed. A revised
estimated completion date is still
under consideration.
48
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
Significant Data Quality
Deficiencies Impede
EPA's Ability to Ensure
Companies Can Pay for
Cleanups
16-P-0126
03/31/16
OLEM&
OECA
1. Comply with the material
weakness reporting requirements
as prescribed by the Federal
Managers' Financial Integrity Act
and OMB Circular A-123 by
identifying the weaknesses from,
and data quality and control
deficiencies in, Resource
Conservation and Recovery Act
and Superfund financial
assurance in the EPA's Federal
Managers' Financial Integrity Act
reports for 2016.
CA15: Conduct a system
requirements feasibility
analysis of the financial
assurance data system to
improve data quality and
establish appropriate controls for
the data systems, review existing
systems for tracking financial
assurance instruments, identify
opportunities for communication
among the financial assurance
systems, and assess means to
better monitor national
compliance.
03/31/17
$0
$0
Additional time is needed to
analyze data associated with the
automation of the financial
assurance business processes.
The anticipated revised
completion date is 9/26/17.
Drinking Water: EPA
Needs to Take Additional
Steps to Ensure Small
Community Water
Systems Designated as
Serious Violators
Achieve Compliance
16-P-0108
03/22/16
Region 2
2. Include in Region 2 formal
enforcement orders information
about how noncompliant systems
can access compliance
assistance resources available
through the coordinating
committee established in
Recommendation 1, and request
Puerto Rico Department of
Health to include this information
in its formal enforcement orders.
03/31/17
$0
$0
Due to delays in staffing at
Puerto Rico agencies after the
November 2016 election, the
initial meeting of the Coordinating
Committee will take place in April
2017. At that meeting and
subsequently, the additional
resources will be identified, then
the attachment will be updated.
The revised estimated
completion date is 6/30/17.
OECA
5. Require regions to provide
annual justification of the lack of
formal enforcement action when
regional actions do not comply
with the Enforcement Response
Policy requirement for formal
enforcement action or return to
compliance at a priority system.
12/30/16
The staff was unable to complete
this corrective action timely. The
office requires additional time to
review policy matters and
coordinate with regions. The
revised due date is 6/29/17.
EPA's Tracking and
Reporting of Its
Conference Costs Need
Improvement
16-P-0081
01/07/16
OCFO
2. Work with program offices to
identify EPA Form 5170A cost
reporting issues and revise the
form to allow for easier user
reporting.
03/31/16
$0
$0
More time is needed to
implement fixes to the
conference spending form.
OCFO now expects to complete
this action by 6/30/17.
49
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
3. Provide additional guidance or
training to EPA staff on how to:
a. Include conference project
codes on procurement and
training-related costs entered
into the financial system.
b. Code conference travel
authorizations with the correct
conference project code.
c. Identify all costs associated
with a conference in the
financial system.
d. Report all conference costs
paid with EPA funds, not just
those paid by the reporting
office.
06/30/16
More time is needed to
implement an appropriate
process for ensuring
procurements will utilize the
conference project codes. OCFO
now expects to complete this
action by 6/30/17.
Audit of EPA's Fiscal
Years 2015 and 2014
Consolidated Financial
Statements
16-F-0040
11/16/15
OCFO
36. Complete the corrective
actions previously identified in
Table 4.
38. Follow the terms in the legal
source documents when
recording interest by ensuring
interest is recorded in the system
when a receivable becomes past
due, either through Compass
automatic calculations or manual
interest calculations prepared by
the Cincinnati Finance Center.
09/30/16
09/30/16
$0
$0
The Combined Federal
Campaign has submitted a
request to gain access to a table,
which houses when interest
starts. That would help the
Cincinnati Finance Center to
adhere to legal terms (such as
interest accrual from a date other
than the receivable date) and
hopefully would enable Compass
to accrue interest once a debt
becomes delinquent. This applies
to both recommendations.
EPA Needs to Improve
the Recognition and
Administration of Cloud
Services for the Office of
Water's Permit
Management Oversight
System
15-P-0295
09/24/15
OW
4. Develop and implement an
approved system authorization
package (i.e., a risk assessment,
System Security Plan, and
Authorization to Operate), and
perform annual security
assessments for the Permit
Management Oversight System
application.
05/31/16
$0
$0
OW's Project Management Office
Director stated that all Inspector
General correspondence related
to permit management oversight
be sent to the Chief Information
Officer. OW is to wait for a
drafted response from the Office
of Environmental Information as it
relates to cloud offerings since
they are the responsible party.
Internal Controls Needed
to Control Costs of
Superfund Technical
Assessment & Response
Team Contracts, as
Exemplified in Region 7
15-P-0215
07/20/15
Region 7
3. Require the Project Officer to
notify the contractor of the
required monthly progress report
elements, and ensure that the
contractor begins submitting all
required elements.
12/31/15
$0
$0
Time and Attendance
Fraud Not Identified for
Employees on Extended
Absence, But Matters of
Concern Brought to
EPA's Attention
15-P-0167
06/15/15
OA
1. Address the specific matters of
concern noted in this report
pertaining to:
a. Accuracy of time charges in
PeoplePlus.
b. Use of a personal computer
to conduct official work.
c. Safety of the work space for
employees on reasonable
accommodation telework.
04/30/16
$0
$0
The corrective action is delayed
because of difficulty in assessing
responsibilities and roles
between OARM and the Office of
Civil Rights on the Reasonable
Accommodations Telework
Policy. The Office of Civil Rights
has had a change of
management and is considering
this issue in light of that.
50
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
Improved Oversight of
EPA's Grant Monitoring
Program Will Decrease
the Risk of Improper
Payments
15-P-0166
06/11/15
OGD
3. Follow up on undocumented
costs identified in the OIG finding
and require grant recipients to
reimburse the agency for costs
deemed unallowable based on
insufficient and/or unacceptable
source documentation.
12/31/15
$0,507
$0
In the process of being extended
to 5/30/17. The OIG did not
concur with the resolution of the
Chehalis Tribe's advanced
monitoring review. Region 10
requested additional justification
and alternative documentation
from the recipient, with an
04/26/17 deadline.
Walker River Paiute
Tribe Needs to Improve
Its Internal Controls to
Comply With Federal
Regulations
15-2-0165
June 11,2015
Region 9
5. Require the Walker River
Paiute Tribe to establish internal
controls to ensure compliance
with federal regulations and tribal
policies.
12/31/16
$0
$0
The target for all deliverables has
been extended to 6/30/17.
Audit of EPA's Fiscal
Years 2014 and 2013
(Restated) Consolidated
Financial Statements
15-1-0021
11/17/14
OCFO
5. Improve and maintain support
for how EPA lab renovation
projects are funded.
6. Review funding sources of all
current and future lab
renovations to ensure correct
funding is utilized.
7. Develop policies and
procedures for capital
improvements/betterments to real
property, specifically, to address
EPA lab renovations which could
bulk purchases of equipment and
funding from agency program
appropriations other than the
Buildings & Facility appropriation.
3/31/16
$0
$0
For Recommendations 5 through
7, the Office of the Controller's
Policy, Training and
Accountability Division completed
a FY 2016 policy call that
prioritized how financial policies
will be updated moving forward.
As a result of the prioritization,
policy development related to
these actions is scheduled for
completion 9/30/17.
EPA Region 6
Mismanaged Coastal
Wetlands Planning,
Protection and
Restoration Act Funds
15-P-0003
10/09/14
Region 6
1. Reimburse the Task Force
(through the U.S. Army Corps of
Engineers) questioned costs of
$780,793, unless Region 6 Water
Quality Protection Division
management provides sufficient
and appropriate documentation
to demonstrate that questioned
costs paid with Coastal Wetlands
Planning, Protection, and
Restoration Act funds were
incurred in accordance with
Coastal Wetlands Planning,
Protection, and Restoration Act
appropriations laws and
principles, and interagency
agreements.
2. Direct Region 6 Assistant
Regional Administrator to work
with the OCFO to perform an
internal review of the Water
Quality Protection Division's
Coastal Wetlands Planning,
Protection, and Restoration Act
12/31/16
$0.78
$0
OCFO, Office of General
Counsel and Region 6 will send
an agency response to the OIG
justifying questioned cost and
addressing open
recommendations. The EPA
plans to complete the agreed-to
actions for the remaining
recommendations by 6/30/17.
51
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
spending at the end of FY 2014
to identify improper expenditures
that occurred in 2008 and 2009,
as well as from July 1, 2013,
through September 30,2014.
Reimburse the Task Force
(through the U.S. Army Corps of
Engineers) any questioned costs
identified during the review.
3. Identify and address any
Antideficiency Act violations
resulting from questioned costs
identified in this report or found
by the Region 6 Assistant
Regional Administrator's review,
and report any violations in
accordance with the
Antideficiency Act and EPA
Directive 2520.
5. Take administrative
disciplinary actions, in
accordance with EPA Directive
2520, against EPA employees
responsible for purpose violations
or Antideficiency Act violations
related to improper Coastal
Wetlands Planning, Protection,
and Restoration Act spending.
Nutrient Pollution: EPA
Needs to Work with
States to Develop
Strategies for Monitoring
the Impact of State
Activities on the Gulf of
Mexico Hypoxic Zone
14-P-0348
09/03/14
OW
1. Work with the state and federal
Task Force members in the
Mississippi River Watershed to
develop and enhance monitoring
and assessment systems that will
track the environmental results of
state nutrient reduction activities,
including their contribution to
reducing the size of the Gulf of
Mexico hypoxic zone.
6/30/15
$0
$0
The Nonpoint Source Measure
Workgroup has continued to
make progress reviewing and
discussing available and
achievable common measures
that all Hypoxia Task Force
states can use to track progress.
The EPA has assembled
information on the conservation
practices funded by the agency's
3199 nonpoint source control
stats. States have compiled data
on state-funded practices. The
workgroup is identifying potential
sources of private conservation
investments and is anticipating
that U.S. Department of
Agriculture's National Resource
Conservation service will release
a national data sharing policy to
describe a process for states to
access U.S. Department of
Agriculture conservation practice
implementation information.
Based on a preliminary data
analysis and with anticipation of
the U.S. Department of
Agriculture's forthcoming national
52
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
data sharing policy, the
workgroup expects that a
Nonpoint Source Measures
Report can be completed this
calendar year. The task force will
continue working to include
information on privately funded
conservation investment in future
reports on nonpoint source
progress. A revised expected
completion date is still under
review. The Hypoxia Task Force
continues to work on its first
nonpoint source measures report
and anticipates issuing a first
report describing progress to
date by 6/1/17.
EPA Has Made Progress
in Assessing Historical
Lead Smelter Sites But
Needs to Strengthen
Procedures
14-P-0302
06/17/14
OLEM
5. Following completion of the
2012 Strategy, create and post a
summary of the results of EPA's
efforts to address sites included
in the strategy and, as applicable,
any findings and recommen-
dations on the EPA's website.
12/31/15
$0
$0
OLEM is revising the corrective
action milestone date from
3/31/17 to 4/28/17. Additional
time is needed to complete the
review process.
EPA Did Not Conduct
Thorough Biennial User
Fee Reviews
14-P-0129
03/04/14
OW
5. Apply federal user fee policy in
determining whether to (a)
charge fees for issuing federal
National Pollutant Discharge
Elimination System permits in
which the EPA is the permitting
authority, or (b) request an
exception from OMB to charging
fees.
12/31/14
$17.8
$0
This recommendation is revised
to 10/1/17 to allow OW to
continue working with OCFO to
request an exception from a
National Pollutant Discharge
Elimination System user fee.
New Jersey Department
of Environmental
Protection Needs to Meet
Cooperative Agreement
Objectives and Davis-
Bacon Act Requirements
to Fully Achieve Leaking
Underground Storage
Tank Goals
14-R-0278
06/04/14
Region 2
1. Require New Jersey
Department of Environmental
Protection to establish internal
controls to ensure that
modifications to the cooperative
agreement work plan are in
accordance with the
requirements of 40 CFR 31.30
and 31.40.
09/30/15
$0
$0
The policy required to implement
this corrective action is delayed
because of new policies under
the Uniform Grant Guidelines.
The revised expected completion
date is 9/30/17.
The EPA Needs to
Improve Timeliness and
Documentation of
Workforce and Workload
Management Corrective
Actions
13-P-0366
08/30/13
OCFO
1. Notify all the EPA's action
officials that when they extend
planning completion dates by
more than 6 months they must
provide the OIG with written
notification that includes the new
milestone dates.
CA1.3 - Conduct Management
Accountability Reviews to review
audit follow-up documentation
and Quality Assurance/Quality
Control data in Management
Audit Tracking System.
09/30/15
$0
$0
Revised estimated completion
date is 9/30/18 due to loss in
contractor support. OCFO
transitioned its audit
management function to the
Office of the Controller, and is
evaluating its plan for
implementing the remainder of
the onsite Management Audit
Tracking System Data Quality
Assurance Reviews, as part of
the Management Accountability
Reviews conducted in offices and
regions.
53
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
Improvements Needed in
EPA's Smartcard
Program to Ensure
Consistent Physical
Access Procedures and
Cost Reasonableness
13-P-0200
03/27/13
OARM
1. Re-prioritize the remaining
facility upgrades by security level
from highest to lowest, complete
all remaining upgrades according
to security level, and require the
Security Management Division
Director to provide written
justification for upgrading Level 1
facilities.
06/30/14
$0
$0
Physical Access Control Systems
solutions have been added to the
Approved Products List. The EPA
has selected compliant, proven
products and begun moving
ahead with the remaining
upgrades. On 12/16/14, we
notified OMB of our revised
implementation plan. We
anticipate initiating the remaining
Physical Access Control Systems
upgrades as follows: Facility
Security Level 2 facilities by 04
FY 2016-9/30/17.
Improvements Needed in
EPA Training and
Oversight for Risk
Management Program
Inspections
13-P-0178
03/21/13
OLEM
7. Coordinate with the Assistant
Administrator for Enforcement
and Compliance Assurance to
revise inspection guidance to
recommend minimum inspection
scope for the various types of
facilities covered under the
program and provide detailed
examples of minimum reporting.
8. Coordinate with the Assistant
Administrator for Enforcement
and Compliance Assurance to
develop and implement an
inspection monitoring and
oversight program to better
manage and assess the quality of
program inspections, reports,
supervisory oversight, and
compliance with inspection
guidance.
07/31/14
09/30/14
$0
$0
The two remaining corrective
actions have been delayed by
actions and deadlines associated
with implementation of Executive
Order 13650, Improving
Chemical Facility Safety and
Security, which lays out a
comprehensive set of actions to
advance chemical facility safety
and security, including federal
coordination of inspections. In
March 2016, the OLEM Assistant
Administrator approved to revise
the corrective action milestone
date from 9/30/16 to 9/3018. This
action requires development of
guidance which will specify the
minimum inspection scope for
each of the facility types
regulated by the Risk
Management Plan program and
revise reporting guidance to
provide detailed examples of
compliance, with the expectation
of completing a final Risk
Management Plan regulation by
late 2016/early 2017. Following
completion of the final regulation,
the EPA will be required to revise
the Risk Management Plan
on-line reporting system and over
a dozen guidance documents to
incorporate the regulatory
changes. This effort will take 2-3
years and must be completed in
that timeframe to give facilities
time to review the guidance and
comply with the new
requirements under the Risk
Management Plan program.
Therefore, this action item must
be delayed until after the
completion of that work.
54
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
Review of Hotline
Compliant Concerning
Cost and Benefit
Estimates for EPA's
Lead-Based Paint Rule
12-P-0600
07/25/12
OCSPP
1. Consistent with a retrospective
and flexible EPA regulatory
culture, reexamine the estimated
costs and benefits of the 2008
Lead Rule and the 2010
amendment to determine
whether the rule should be
modified, streamlined, expanded,
or repealed.
CA1-3: Draft information and
analysis submitted to OMB for
Interagency review as part of the
Action Development Process.
CA1-4: Work practice and cost
information is published as part
of proposed rule.
3/31/15
9/30/15
$0
$0
EPA was sued on the 2008 Lead
Renovation, Repair and Painting
final rule for, among other things,
failing to meet its statutory
obligation to address renovations
in Public and Commercial
buildings. EPA entered into a
settlement agreement that
included establishment of a
timeline for action on renovations
in public and commercial
buildings. The agreement has
been amended several times,
with the latest deadline for
issuing a proposed rule being
3/31/17. In June 2016, the
agency notified the litigants that
EPA will not meet the 3/31/17
deadline. A new deadline has not
been agreed upon with the
litigants.
Controls Over State
Underground Storage
Tank Inspection
Programs in EPA
Regions Generally
Effective
12-P-0289
02/15/12
OLEM
1. Require EPA and states to
enter into Memorandums of
Agreement that reflect program
changes from the 2005 Energy
Policy Act and address oversight
of municipalities conducting
inspections.
08/01/13
$0
$0
On 7/15/15, the revised
Underground Storage Tank
regulations were published, to be
effective 10/13/15. States were
given 3 years (10/13/18) to
submit their application to receive
State Program Approval or the
application to get their current
State Program Approval status
renewed. We agreed we would
require all states to update their
current Memorandums of
Agreement with EPA at the same
time. Therefore, our expected
completion date is 10/13/18.
EPA Needs to Further
Improve How It Manages
Its Oil Pollution
Prevention Program
12-P-0253
02/06/12
OLEM
2. Improve oversight of facilities
regulated by EPA's oil pollution
prevention program by:
d. Producing a biennial public
assessment of the quality and
consistency of Spill Prevention,
Control, Countermeasure
Plans and Facility Response
Plans based on inspected
facilities.
CA1 -2: A summary of findings
will be developed by October,
2013. These findings will help
to identify areas where
additional guidance and
outreach are needed to
improve the quality and
consistency of Spill Prevention,
Control, Countermeasure
Plans.
10/31/13
$0
$0
1 .d 1-2 through 1-4 reduced
extramural resources and
available personnel, program
implementation priorities
including inspections, and new
priority concerns for oil spill
response associated with
increased oil transportation have
delayed, effort on this milestone
for at least a year or more. In
addition, recent enactment of the
water Resources Reform and
Development act place additional
priority responsibilities on the
Spill Control and
Countermeasure program for the
next 2 years. Consequently,
action on this corrective action
cannot begin before June 2017.
55
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
CA1-3: The model developed
for the Spill Prevention,
Control, Countermeasure
program will then be used to
develop a review protocol for
Facility Response Plan by
September 2013, to examine
Facility Response Plan
inspections conducted during
the FY 2013 inspection cycle.
9/30/13
CA1 -4: A summary of findings
will be developed by October
2014. These findings will help
to identify areas where
additional guidance and
external outreach are needed
to improve the quality and
consistency of Facility
Response Plans.
10/31/14
Agreed-Upon Procedures
Applied to EPA Grants
Awarded to Summit Lake
Paiute Tribe, Sparks,
Nevada
12-2-0072
11/10/11
Region 9
2. Require the tribe to implement
internal controls to ensure that:
a. Employees document all
hours worked in accordance with
2 CFR Part 225 requirements.
b. The chairman's consent to
use his signature stamp for
timesheet approval is
independently verified.
c. Leave allocation complies with
2 CFR Part 225 requirements.
07/31/12
$0
$0
Plan to follow-up with recipient
for supporting documents.
Audit of EPA's Fiscal
2009 and 2008
(Restated) Consolidated
Financial Statements
10-1-0029
11/16/09
OCFO
27. Ensure that all new financial
management systems (including
the Integrated Financial
Management System
replacement system) and those
undergoing upgrades include a
system requirement that the
fielded system include an
automated controls to enforce
separation of duties.
CA8 - Office of Technology
Solutions will modify Compass
user profiles to create specific
security roles to allow Compass
Security Officers to better
manage user access.
CA9 - Office of Technology
Solutions will enhance the
Access Request Form application
to add additional controls and
automatic logic to check for
approved waivers on file to
prevent users submit security
options that violate the
separation of duties policy.
12/31/15
$0
$0
Corrective actions extended due
to other high priority projects.
OCFO's Office of Technology
Solutions will seek additional
resources to complete these
tasks.
56
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented
Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost
Savings
Sustained
(in Millions)
Reason for Delay
Making Better Use of
Stringfellow Superfund
Special Accounts
08-P-0196
07/09/08
Region 9
2. Reclassify or transfer to the
Trust Fund, as appropriate,
$27.8 million (plus any earned
interest less oversight costs) of
the Stringfellow special accounts
in annual reviews, and at other
milestones including the end of
Fiscal Year 2010, when the
record of decision is signed and
the final settlement is achieved.
12/31/12
$27.8
$0
In 2012, a new area of
groundwater contamination was
identified that is commingling with
and will directly impact the
cleanup of existing Stringfellow
contamination, requiring further
investigations. Due to the
additional investigations at the
site, the anticipated date to
complete the sitewide Record of
Decision was 12/31/15. In July
2016, Region 9 issued a memo
to notify the OIG of the extension
for estimated completion date to
9/30/23 due to additional work
that the state has committed to
complete in support of the final
sitewide Record of Decision.
Totals
$48,902
$0,000
57
-------
Semiannual Report to Congress October 1, 2016—March 31, 2017
CSB Reports With Past Due Unimplemented Recommendations
No CSB reports had past due unimplemented recommendations.
58
-------
Semiannual Report to Congress October 1, 2016—March 31, 2017
EPA Reports With Unimplemented Recommendations With Future Dates
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
Religious Compensatory Time
Is Subject to Abuse
16-P-0333
09/27/16
OCFO
4. Modify the EPA's payroll and time and
attendance system to include the enhanced
internal controls, preventing employees from
accumulating Religious Compensatory Time
hours inconsistent with revised policies and
procedures
9/30/18
$0
$0
EPA Needs a Risk-Based
Strategy to Assure Continued
Effectiveness of Hospital-Level
Disinfectants
16-P-0316
09/19/16
OCSPP
1. Suspend administering the current
Antimicrobial Testing Program until completion
of the one-time re registration process.
2. Develop a risk-based antimicrobial testing
strategy to assure the effectiveness of public
health pesticides used in hospital settings once
products are in the marketplace. At a minimum,
the strategy should:
a. Include a framework for periodic testing to
assure products continue to be effective after
resignation.
b. Define a program scope that is flexible and
responsive to current and relevant public
health risks.
c. Identify risk factors for selecting products to
test.
d. Identify the method to be used for obtaining
samples for testing.
e. Designate a date to commence risk-based
post-registration testing.
11/30/17
11/30/18
$0
$0
Progress Made but
Improvements Needed at CTS
of Asheville Superfund Site in
North Carolina to Advance
Cleanup Pace and Reduce
Potential Exposure
16-P-0296
08/31/16
Region 4
12. Develop and implement sitewide hydrologic
and water-quality monitoring that will integrate
the planned monitoring of the fractured bedrock;
the ongoing monitoring of wells used for drinking
water, the removal action system at the eastern
springs, and ambient air at the western springs;
and the yet-to-be designed and implemented
monitoring for the interim remedial action.
06/30/17
$0
$0
EPA Oversight of Travel Card
Needs to Improve
16-P-0282
08/24/16
OCFO
4. Revise travel card policy to institute stronger
controls for timely travel card payments, adverse
actions for late payments, and the requirement
to use the travel card for all travel expenses.
5. Strengthen internal controls in Concur so that
lodging and rental car expenses on vouchers
can only result in a bank card payment.
6. Require each travel cardholder (before any
future travel is approved) to complete training
that covers the importance of split payments;
timely payments; and the consequences of
failure to comply, so that disciplinary action can
be taken against late-paying cardholders.
6/30/17
$0,032
$0
59
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
EPA Region 9 Needs to
Improve Oversight of San
Francisco Bay Water Quality
Improvement Fund Grants
16-P-0276
08/22/16
Region 9
1. Issue a memorandum (or memoranda) and
provide training to grant specialists, project
officers and managers associated with the
San Francisco Bay Water Quality Improvement
Fund grants regarding the importance of:
a. Accurate and timely baseline monitoring.
b. Verifying grantees provide required
documents through the life of the grant.
c. Providing evidence and follow-up of and
responses received regarding missing
documents or concerns identified during
baseline monitoring.
d. Holding staff accountable for grant
management
2. Develop a mechanism or quality review
process to verify the accuracy of San Francisco
Bay Water Quality Improvement Fund baseline
monitoring and the effectiveness of project
oversight.
4. Develop a mechanism or quality review
process so managers can verify that project
officers exercise effective oversight.
9/30/17
09/30/17
09/30/17
$0
$0
EPA Regional Offices Need to
More Consistently Conduct
Required Annual Reviews of
Clean Water State Revolving
Funds
16-P-0222
07/7/16
OARM
9. Develop and implement a plan to ensure
administrative baseline monitoring reviews are
completed as required by scheduling reviews
around peaks in workloads.
10/01/17
$0
$0
EPA Has Developed Guidance
for Disaster Debris but Has
Limited Knowledge of State
Preparedness
16-P-0219
06/29/16
OLEM
2. Develop and implement a plan to provide
assistance to all states on developing disaster
debris management plans that address the
major elements identified in EPA's guidance.
09/30/17
$0
$0
EPA Region 9 Needs to
Improve Oversight Over
Commonwealth of the
Northern Mariana Islands
Consolidated Cooperative
Agreements
16-P-0207
June 20,2016
Region 9
1. Disallow and recover the $1,082,982 in
Department of Environmental Quality
unsupported labor costs unless Department of
Environmental Quality provides support that
complies with 2 CFR Part 225, Appendix B,
Section 8.h, requirements and Consolidated
Cooperative Agreement terms.
2. Disallow and recover the $402,197 in
Commonwealth Utilities Corporation
unsupported labor costs unless Commonwealth
Utilities Corporation provides support that
complies with 2 CFR Part 225, Appendix B,
Section 8.h, requirements and Consolidated
Cooperative Agreement terms.
09/30/17
09/30/17
$1,083
$0,402
$0
$0
EPA Needs Better Data, Plans
and Tools to Manage Insect
Resistance to Genetically
Engineered Corn
16-P-0194
06/01/16
OCSPP
5. Make Compliance Assurance Program
reports and resistance monitoring data publically
available on the EPA's website.
07/31/17
$0
$0
60
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
6. Improve the EPA's website by adding more
general information about biotechnology and
genetically engineered crops, specifically
Bacillus thuringiensis corn and insect resistance.
07/31/17
EPA Region 9 Needs to
Improve Oversight Over
Guam's Consolidated
Cooperative Agreements
16-P-0166
05/09/16
Region 9
3. For the period from FY 2010 to when the
Guam legislature relinquishes control, obtain
and review detailed Guam Environmental
Protection Agency transactions for program
income receipts and expenditures for all
program income funds to verify expenditures are
allowable costs per 40 CFR Part 31, and take
appropriate action to recover unallowable costs.
15. Require the project officer to oversee Guam
Environmental Protection Agency activities and
confirm input of all un-entered Safe Drinking
Water Information System data to eliminate the
backlog.
16. Require the project officer to oversee Guam
Environmental Protection Agency activities to
confirm input of current Safe Drinking Water
Information System data in a timely, accurate
and complete manner.
09/30/17
09/30/17
09/30/17
$0
$0
Significant Data Quality
Deficiencies Impede EPA's
Ability to Ensure Companies
Can Pay for Cleanups
16-P-0126
03/31/16
OLEM&
OECA
3. Periodically assess and report to agency
management progress against Federal
Managers' Financial Integrity Act corrective
action plans for Resource Conservation and
Recovery Act and Superfund financial
assurance weaknesses.
9/30/17
$0
$0
EPA Offices Are Aware of the
Agency's Science to Achieve
Results Program, but
Challenges Remain in
Measuring and Internally
Communicating Research
Results That Advance the
Agency's Mission
16-P-0125
09/27/16
ORD
1. Create procedures for developing Request for
Applications to ensure program office input is
considered in the Request for Applications
development process.
2. Create procedures for conducting relevancy
reviews to ensure program office input is more
consistently and transparently considered in the
grant selection process (to the extent permitted
by the Federal Grant and Cooperative
Agreement Act and EPA Order 5700.1). The
procedures should include a mechanism for
sharing how the results of relevancy reviews
impacted award decisions.
3. Develop and implement procedures to
improve communications with EPA program
offices regarding Science to Achieve Results
(research results. The procedures should:
a. Ensure that the Science to Achieve Results
grant public website is up to date.
b. Revise the National Center for
Environmental Research Project Officer
Manual (or develop a more dynamic tool) to
reflect expectations for communicating grant
results.
c. Clarify and define roles and responsibilities
for communicating research results.
06/30/17
06/30/17
09/30/17
$0
$0
61
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
5. Establish performance measures or a
mechanism to capture and report out on how
completed Science to Achieve Results grants
have met their performance goals and provide
incidental research support to program offices.
09/30/17
Positioning EPA for the Digital
Age Requires New Mindsets
Toward Printing
16-P-0107
03/21/16
OARM
1. Update the EPA's main authoritative guidance
for printing operations (Printing Management
Manual) to include authorization for
decentralized operations within the regions.
2. Issue guidance to EPA regions and program
offices to reiterate roles and responsibilities to
help reinforce the authority of the Agency
Printing Officer and to change behaviors.
Guidance should specifically include procedures
to facilitate the most efficient and economical
methods for printing and inventory management.
09/30/17
09/30/17
$0
$0
EPA Has Not Met Statutory
Requirements for Hazardous
Waste Treatment, Storage and
Disposal Facility Inspections,
but Inspection Rates Are High
16-P-0104
03/11/16
OECA
1. Implement management controls to complete
the required Treatment, Storage and Disposal
Facility inspections.
CA-1: Formalize existing process for
prioritizing Research Conservation and
Recovery Act Treatment, Storage and
Disposal Facility inspections based on the
risks posed to human health and the
environment.
CA-2: Revise OECA policies and procedures
to clarify those facilities that properly fall within
the definition of a Treatment, Storage and
Disposal Facility.
CA-3: Strategically prioritize inspections,
addressing hazardous waste management
facilities that present the greatest concerns.
EPA will approach OMB about whether a
clarification to the statue is appropriate or
necessary.
12/31/17
03/31/18
02/28/17
$0
$0
EPA Can Strengthen Its
Reviews of Small Particle
Monitoring in Region 6 to
Better Ensure Effectiveness of
Air Monitoring Network
16-P-0079
12/17/15
OAR
3. Develop a process for ensuring that state and
local monitoring agencies are provided with
updated data analysis tools for future network
assessments.
03/31/18
$0
$0
Audit of EPA's Fiscal Years
2015 and 2014 Consolidated
Financial Statements
16-F-0040
11/16/15
OCFO
1. Continue planned corrective actions and its
outreach to program offices to validate all
software costs in development and asset values
in production.
2. Require staff to ensure all software costs,
including adjustments, are accurately recorded
in the agency's property management system
and Compass; and that an audit trail is
maintained for software projects analyzed.
09/30/18
10/30/18
$0
$0
62
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
26. Implement an internal control process for
transferring the management of an application's
user access to the Application Management
Staff.
12/31/17
27. Conduct an inventory of OCFO systems
managed by the Application Management Staff
and create or update supporting access
management documentation for each
application.
03/31/18
28. Work with the contracting officer to update
applicable contract clauses and distribute
updated access management documentation to
contractors supporting the user account
management function for applications managed
by the Application Management Staff. This
should include establishing a date when the
contractors would start using the updated
account management documentation.
12/31/17
29. Review and update account management
documentation and establish procedures for
financial systems, as needed, to include
implementation of the following controls:
a. Assign account managers for user
accounts.
b. Establish role conditions for system access
privileges
c. Require approvals to create accounts.
d. Monitor use of accounts.
e. Notify account managers when accounts
are removed or changed.
f. Authorize access based on valid
authorizations.
g. Review accounts for appropriateness of
current access privileges.
12/31/17
EPA Needs Policies and
Procedures to Manage Public
Pesticide Petitions in a
Transparent and Efficient
Manner
16-P-0019
10/27/15
OCSPP
4. Provide criteria and guidelines for submission
of public pesticide petitions that provide
sufficient information for EPA review.
10/31/17
$0
$0
Incomplete Contractor
Systems Inventory and a Lack
of Oversight Limit EPA's Ability
to Facilitate IT Governance
15-P-0290
09/21/15
OEI
5. Implement the recommendation of the EPA's
Information Security Task Force to manage the
vulnerability management program.
09/30/17
$0
$0
63
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
EPA's Oversight of State
Pesticide Inspections Needs
Improvement to Better Ensure
Safeguards for Workers,
Public and Environment Are
Enforced
15-P-0156
5/15/15
OECA
1. In conjunction with the Office of Chemical
Safety and Pollution Prevention, revise the
Federal Insecticide, Fungicide, and Rodenticide
Act Project Officer Manual to include specific
guidance for:
a. Reporting, documenting and retaining
records from project officer inspection
reviews.
b. Providing documentation on how a state's
enforcement actions are consistent with the
state's enforcement policies and procedures.
c. Selecting inspection files for review.
d. Documenting doseout meetings with
states.
2. Ensure that required Federal Insecticide,
Fungicide, and Rodenticide Act project officer
training is conducted periodically and the above
guidance is included in the training.
CA-2: Conduct training for states and tribes.
CA-3: Convert 3-day training content to
E-learning module to post online and make
available to Federal Insecticide, Fungicide,
and Rodenticide Act project officers.
06/30/17
06/30/17
12/30/18
$0
$0
Conditions in the U.S. Virgin
Islands Warrant EPA
Withdrawing Approval and
Taking Over Management of
Some Environmental
Programs and Improving
Oversight of Others
15-P-0137
04/17/15
Region 2
13. To improve oversight of the Underground
Storage Tank/Leaking Underground Storage
Tank program, establish an updated
Underground Storage Tank/Leaking
Underground Storage Tank Memorandum of
Agreement with the U.S. Virgin Island that
reflect changes and new provisions results from
the Energy Policy Act of 2005. The
Memorandum of Agreement should also outline
roles, responsibilities and expectations.
09/30/18
$0
$0
18. Develop a plan to address currently
uncompleted tasks and activities, and develop a
schedule for reprogramming grant funds to
accomplish these task if the U.S. Virgin Islands
does not or cannot complete them. Upon
completion of the financial management
corrective actions, follow the Office of Chief
Financial Officer's Resource Management
Directive System 2520-03 to determine whether
any of the current unspent funds of
approximately $37 million under the U.S. Virgin
Islands' assistance agreements could be put to
better use.
09/30/18
$37.0
$0
Audit of EPA's Fiscal Years
2014 and 2013 (Restated)
Consolidated Financial
Statements
15-1-0021
11/17/14
OCFO
2. Require the Reporting and Analysis Staff to
coordinate with Office of Administration and
Resources Management project officers to
receive software project cost support once
placed into service.
3. Document and support project costs for all
software costs placed into service over the past
7 years.
10/31/18
$0
$0
64
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
Enhanced EPA Oversight
Needed to Address Risks
From Declining Clean Air Act
Title V Revenues
15-P-0006
10/20/14
OAR
1. Assess whether the EPA's 1993 fee schedule
guidance sufficiently addresses current program
issues and requirements related to how Title V
fees should be collected, retained, allocated and
used. Revise the fee guidance as necessary
and re-issue to EPA regions.
2. Issue guidance requiring EPA regions to
periodically obtain and assess authorized state
and local permitting authorities' Title V program
revenues, expenses and accounting practices to
ensure that permitting authorities collect
sufficient Title V revenues to cover Title V
program costs.
3. Establish a fee oversight strategy, including a
hierarchy of actions and related timeframes, to
ensure that EPA regions take consistent and
timely actions to identify and address violations
of 40 CFR Part 70 Title V fee revenues,
expenses and accounting practices.
5. Require that EPA regions periodically
emphasize and include reviews of Title V fee
revenue and accounting practices in Title V
program evaluations.
6. Require that EPA regions address shortfalls
in the financial or accounting expertise among
regional Title V program staff as the regions
update their workforce plans. This may include
resource sharing and collaboration with other
EPA regions, or use of outside organizations, as
appropriate.
7. Require that EPA regions re-assess
permitting authority fee structures when revenue
sufficiency issues are identified during program
evaluations, and require fee demonstrations as
necessary.
8. Require that EPA regions take action on
permitting authorities not in compliance with
40 CFR Part 70 by finding them to be
inadequately administered or enforced, and
issuing the required Notice of Deficiencies.
09/30/17
09/30/17
09/30/17
09/30/17
09/30/17
09/30/17
09/30/17
$0
$0
Cloud Oversight Resulted in
Unsubstantiated and Missed
Opportunities for Savings,
Unused and Undelivered
Services, and Incomplete
Policies
14-P-0332
07/24/14
OEI
4. Prior to entering into any future Infrastructure-
as-a-Service contracts, perform a formal
documented analysis to determine whether such
contracts are in the EPA's best interest that
includes the investments the EPA would have to
make to address integration requirements,
obstacles and gaps identified as a result of the
current Infrastructure-as-a-Service contract.
10/16/17
$0
$0
65
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
Internal Controls Needed to
Control Costs of Emergency
and Rapid Response Services
Contracts, as Exemplified in
Region 6
14-P-0109
02/04/14
Region 6
3. Direct Contracting Officers to require that the
contractor adjust all its billings to reflect the
application of the correct rate to team
subcontract Other Direct Costs.
09/30/24
$0
$0
Audit of EPA's Fiscal 2013 and
2012 Consolidated Financial
Statements
14-1-0039
12/16/13
OEI
12. Conduct training for staff in charge of
receiving and analyzing monthly Vulnerability
Management reports to ensure they are
knowledgeable of the agency's remediation
process for vulnerabilities. This training should
include specific information on how to review the
provided Vulnerability Management report and
what actions offices must take regarding the
identified vulnerabilities.
09/30/17
$0
$0
Air Quality Objectives for the
Baton Rouge Ozone
Nonattainment Area Not Met
Under EPA Agreement
2A-96694301 Awarded to the
Railroad Research Foundation
13-R-0297
06/20/13
Region 6
1. Recover federal funds of $2,904,578 unless
the foundation provides a verifiable and
enforceable remedy to reduce diesel emissions
in the Baton Rouge ozone nonattainment area,
as required by the cooperative agreement.
CA2: Two of the five rebuilt locomotives will
continue to operate in the Baton Rouge
nonattainment area.
CA3: The remaining three rebuilt locomotives
will continue to operate in Baton Rouge and
New Orleans until economic conditions in
Baton Rouge necessitate moving as many
locomotives as possible back to the Baton
Rouge non-attainment area.
CA5: Railroad Research Foundation will
provide locomotive location data to EPA on a
quarterly basis showing where the five
locomotives were operated.
CA6: As a penalty for noncompliance,
Railroad Research Foundation will remit to the
U.S. EPA $4,841 for each locomotive for each
month any of the five locomotives are
operated outside of the restricted area for
more than 10-plus consecutive days outside
the Baton Rouge non-attainment area and the
Exception area (for other than maintenance).
CA7: Each of the five locomotives will operate
in Baton Rouge area or the exception area for
10 years after the date each engine was
placed back into service.
09/30/20
09/30/20
09/30/20
09/30/20
09/30/20
09/30/20
$2,905
$0
EPA Needs to Improve Air
Emissions Data for the Oil and
Natural Gas Production Sector
13-P-0161
02/20/13
OAR
2. Prioritize and update existing oil and gas
production emission factors that are in greatest
need of improvement and develop new emission
factors for key oil and gas production processes
that do not currently have emission factors.
$0
$0
66
-------
Semiannual Report to Congress
October 1, 2016—March 31, 2017
Report Title/No./Date
Office
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
CA2.3 - The EPA will revise the Electronic
Reporting Tool to accommodate those non-
traditional measurement techniques identified
in the cross-office strategy and fully
developed by the 4th Q of FY 2017.
CA2.4 - The EPA will set forth procedures for
developing emissions factors based on data
collected with non-traditional measurement
techniques and incorporate those procedures
into WebFIRE (Web Information Retrieval
System).
9/30/18
9/30/19
EPA Should Update Its Fees
Rule to Recover More Motor
Vehicle and Engine
Compliance Program Costs
11-P-0701
09/23/11
OAR
1. Update the 2004 fees rule to increase the
amount of Motor Vehicle and Engine
Compliance Program costs it can recover.
12/31/18
$13,000
$13,000
EPA Should Revise Outdated
or Inconsistent EPA-State
Clean Water Memoranda of
Agreement
10-P-0224
09/14/10
OECA
2-2. Develop a systematic approach to identify
which states have outdated or inconsistent
Memorandums of Agreements; renegotiate and
update those Memorandums of Agreements
using the Memorandum of Agreements
template; and secure the active involvement and
final, documented concurrence of Headquarters
to ensure national consistency.
9/30/17
$0
$0
Totals
$54,422
$13,000
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CSB Report With Unimplemented Recommendations With Future Dates
Report Title/No./Date
Unimplemented Recommendation
Planned
Completion
Date
Cost Savings
Recommended
(in Millions)
Cost Savings
Sustained
(in Millions)
CSB Needs to Continue to Improve
Agency Governance and Operations
16-P-0179
05/23/16
6. Include General Services Administration in any future
office leasing plans and revisit office needs for a potential
adjustment or supplement to the Washington, D.C., and
Denver office leases to reduce space within the General
Services Administration benchmarks.
10/20/22
$0,402
$0
Totals
$0,402
$0
68
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October 1, 2016—March 31, 2017
Appendix 4—Closed Projects Not Publicly Disclosed
For Reporting Period Ended March 31, 2017
Section 5(a)(19) of the Inspector General Act of 1978, as amended, requires detailed descriptions of each
investigation involving a senior government employee (at least at the GS-15 level) where allegations of
misconduct were substantiated. Section 5(a)(22) requires detailed descriptions of each investigation
conducted by the OIG involving a senior government employee that was closed and not disclosed to the
public; and detailed descriptions of the particular circumstances of each inspection, evaluation and audit
conducted by the OIG that was closed and was not publicly disclosed.
Details on each investigation conducted by the OIG involving both senior and non-senior employees
closed during the semiannual reporting period ending March 31, 2017, are provided below. This includes
descriptions of investigations where allegations of misconduct involving a senior government employee
were substantiated. We are also including, separately, a listing of each investigation conducted by the
OIG and closed during the semiannual reporting period involving non-employees, including grant
recipients, contractors and former EPA employees.
There were no instances of inspections, evaluations and audits that were closed and not publicly
disclosed during the semiannual period ending March 31, 2017.
Investigations Involving Senior Employees Not Publicly Disclosed
CASE NUMBER: OI-AR-2014-ADM-009Q
An EPA Senior Executive Service-level official was allegedly involved in altering and/or had knowledge
that position descriptions and resumes were being altered to assist EPA employees in obtaining
promotions and other individuals in obtaining employment at the EPA. During the investigation, email files
were reviewed and provided evidence to support the allegation. The case was referred to the Office of
Special Counsel, which concluded that prohibited personnel practices had occurred. The Office of Special
Counsel recommended and conducted training for the entire staff of the employee's office. In addition, the
EPA Office of Suspension and Debarment ordered the employee to complete 24 hours of training in
federal contracting and grants ethics, procurement integrity, and conflicts of interest. The employee is
responsible for payment of the training and must report the results and completion to the Office of
Suspension and Debarment. The Senior Executive Service-level employee also allegedly failed to act
after being made aware that another Senior Executive Service-level employee was misusing an EPA air
card while on personal leave outside of the country. The allegation was inconclusive. The case was
referred to DOJ on July 15, 2014, and was declined for prosecution on December 4, 2014.
CASE NUMBER: QI-HQ-2016-ADM-0062
An EPA GS-15 employee allegedly did not properly oversee the training review process required for the
credentialing of the inspectors managed by the employee. Following investigative interviews and review
of documents, investigators determined that the allegation of improper oversight was supported.
No credible information was developed to believe that any criminal activity occurred. As a result of the
investigative findings, EPA management implemented closer supervision and accounting of supervisory
review and certification of the credentialing of inspectors. They also improved the tracking and
recordkeeping system for training and issued a reminder of the requirement that training certificates be
held by both the supervisor and the inspector.
CASE NUMBER: QI-HQ-2016-ADM-0053
An EPA OIG GS-15 employee allegedly circumvented the hiring process to employ individuals the subject
knew. During the investigative process, additional allegations were established, including the allegation
that the employee had taken a substantial amount of Personally Identifiable Information from a previous
federal agency of employment that contained names, addresses and Social Security numbers of
personnel who were employed at that agency. These and other allegations associated with this case
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were supported; one allegation was not supported. A Report of Investigation was provided to OIG
management for action and a notice or proposed removal was issued, but the employee resigned from
the EPA during the notice period and was subsequently hired by another federal agency. The case was
referred to DOJ on May 9, 2016, and was declined for prosecution the same day.
CASE NUMBER: QI-HQ-2014-ADM-0071
An EPA GS-15 employee allegedly committed time-and-attendance fraud. During the investigation,
additional allegations were developed and referred to EPA management, such as the improper
certification of inspector training records and improper guidance on recording religious compensatory
time. The allegation of time-and-attendance fraud was unsupported; however, EPA management
responded to the OIG referral with multiple actions to reconcile the training record and religious
compensatory time issues.
CASE NUMBER: QI-HQ-2014-ADM-0120
An EPA GS-15 employee allegedly provided false information regarding education history during
background investigations. The OIG investigation supported the allegation. The OIG presented the
investigative findings to the EPA for administrative action. The EPA proposed to remove the employee
from federal service and then entered into a settlement agreement with the employee, allowing the
employee to retire. The EPA and the employee subsequently modified the settlement agreement to allow
the employee to transfer to another federal agency. The case was referred to DOJ on November 19,
2015, and was declined for prosecution the same day.
CASE NUMBER: QI-AT-2017-CAC-0039
An EPA OIG GS-15 employee allegedly used unprofessional language and intimidating behavior toward
colleagues. Over 40 interviews revealed that the manager used foul language in the office even after
being counseled regarding this conduct. The frequent bullying and intimidating behavior—present
throughout the employee's tenure—made staff uncomfortable and reluctant to engage the individual. The
manager was terminated while in probationary status. The case was not referred to DOJ.
CASE NUMBER: QI-AR-2014-ADM-0073
An EPA GS-15 employee allegedly failed to disclose outside income on the required Confidential
Financial Disclosure Report form (OGE Form 450). The investigation findings did not support the
allegation.
Investigations Involving Non-Senior Employees Not Publicly Disclosed
CASE NUMBER: QI-AR-2012-ADM-0144
A GS-14 EPA employee serving as a Contracting Officer Representative allegedly committed multiple
contracting violations. Because of the ongoing investigation, the employee resigned from the EPA. The
results of numerous interviews and reviews of documents supported the allegations that the employee
inappropriately handled EPA contracts. The investigation determined that the former employee's new
position in the private sector potentially involved government contracts, and the matter was referred to the
EPA Office of Suspension and Debarment. As a result, the former employee entered into an agreement
with the Office of Suspension and Debarment to voluntarily abstain from managing or directing federal
contracts for 3 years. Additionally, during the course of the investigation, it was found that the former
employee used an EPA "800" phone number for personal conference calls. As such, management
changed the number's passcode and began to monitor the usage.
CASE NUMBER: OI-AR-2016-ADM-00Q3
An EPA GS-13 employee was allegedly using EPA lab equipment for personal use; the testing equipment
allegedly had data stored on it that was not from EPA testing. The investigation did not support the
allegations; testing performed by the subject was identified as government-related and/or directed by the
subject's supervisor.
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CASE NUMBER: QI-PH-2015-ADM-0038
An EPA GS-13 employee allegedly claimed per diem and mileage reimbursements improperly, and was
alleged to have used a personal cell phone for official business. The investigation determined that the
employee was entitled to receive the per diem in question; this allegation was not supported. However,
the investigation found that the employee claimed full mileage reimbursement rates when reduced
reimbursement rates should have been claimed. This allegation was supported, but the EPA determined
that a full mileage reimbursement rate was appropriate in this instance as it was in the best interest of the
government. Further, it was determined that the employee conducted work on a personal cell phone
multiple times because a government-issued cell phone had not been issued to the employee; this
allegation was referred to EPA management. EPA management stated that it would take action regarding
the referral by ensuring there is an adequate pool of loaner phones available for use, and they would
inform employees that if they use a personal phone for agency business they are entitled to
reimbursement for that usage. EPA management also indicated they would remind employees that if they
use a personal phone to text or email, they must adhere to recordkeeping requirements.
CASE NUMBER: OI-AR-2015-ADM-005Q
An EPA GS-13 employee allegedly viewed pornographic material on a government-issued computer. The
allegation was supported and the employee received a 45-day suspension without pay.
CASE NUMBER: QI-AR-2015-ADM-0120
An EPA GS-13 employee allegedly did not report involvement with an outside company, owned by the
employee's spouse, to EPA management. The investigation determined that, at that time, the employee
was not required to submit a Confidential Financial Disclosure Report form (OGE Form 450). The
employee has since disassociated from the spouse's company and is now required to submit the OGE
Form 450.
CASE NUMBER: QI-DE-2015-ADM-0054
An EPA GS-13 employee allegedly misused a government-issued travel card and the EPA's travel
management system to facilitate personal travel in conjunction with official travel at the government-
contracted rate, fraudulently submitted documentation to receive travel compensatory time off, and used
a government-issued travel card to make personal purchases and then claimed the card was stolen to
avoid repayment. The investigation was inconclusive regarding the misuse of the travel management
system to accommodate personal travel; however, evidence supported the allegation that the subject
used a government-issued travel card to pay for the price differences in airfare instead of a personal
credit card. The last two allegations were not supported. This investigation was referred to EPA
management, and the subject was issued a Letter of Reprimand based on the misuse of the government
travel card.
CASE NUMBER: QI-DA-2016-ADM-0107
An EPA GS-13 employee allegedly lost EPA inspection credentials. During the investigation, the employee
found the credentials and returned them to EPA management. The allegation was supported but no
administrative action was deemed warranted.
CASE NUMBER: QI-DA-2016-ADM-0066
An EPA GS-13 employee allegedly violated the EPAtelework policy and was allegedly under the
influence of alcohol or drugs during work hours. The telework violation was supported; the employee
admitted taking a family member to a doctor on official government time without using leave. There was
insufficient evidence to support the drug or alcohol allegation. This investigation was referred to EPA
management, and the employee was suspended from telework privileges for 6 months.
CASE NUMBER: QI-AT-2016-ADM-0087
An EPA OIG GS-13 employee allegedly displayed a lack of candor when questioned by OIG investigators
concerning a relationship with a GS-15 supervisor who was on the hiring panel that recommended the
employee for OIG employment. The investigation supported the allegation. OIG management conducted
an additional review and determined that the employee did not intentionally withhold information from
investigators, and no action was deemed warranted.
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CASE NUMBER: QI-HQ-2016-ADM-0081
An EPA OIG GS-13 employee allegedly made cash advances using an EPA-issued travel card while not in
travel status. The investigation supported the allegation. According to the employee, two of the cash
advances were made when mistakenly thinking there was a credit due to the account; consequently, the
employee intentionally charged the advances in an effort to be reimbursed for the credit. The employee
mistakenly used the travel card on two additional occasions instead of using a personal credit card. The
employee received a written warning from OIG management, the employee made a written statement to OIG
management outlining a plan of corrective action, and the employee completed EPA travel card training.
CASE NUMBERS: QI-DE-2016-ADM-0105 and OI-HQ-2016-ADM-009Q
An EPA OIG GS-13 employee allegedly committed time-and-attendance fraud. The allegation was
supported because the employee later admitted to committing the fraud. During the investigation,
additional allegations were developed concerning the employee potentially posing a threat to the
employee and others. Upon further questioning, the employee denied having access to firearms, and
investigators directed the employee to contact the EPA employee assistance program, which the
employee agreed to do. Before the investigation was completed, the employee committed suicide. The
OIG worked with the local police on the death investigation to ensure that law enforcement had access to
any information needed regarding the employee's employment.
CASE NUMBER: QI-CH-2016-CAC-0052
An EPA GS-12 employee allegedly made a threatening statement to a supervisor during a meeting.
Interviews of all witnesses were conducted and the investigation determined the allegation was not
supported. However, EPA officials decided to suspend the employee for 10 days for disrespectful
behavior toward a supervisor.
CASE NUMBER: QI-SA-2014-ADM-0065
An EPA GS-12 employee allegedly failed to disclose criminal and financial indebtedness when
completing official government forms. The investigation supported the allegation. During an employment
suitability background investigation, the Office of Personnel Management discovered criminal and
financial indebtedness information regarding the employee that had not been listed on the employee's
Declaration for Federal Employment form (OF-306) and the Questionnaire for Public Trust Positions form
(SF-85P). The EPA's Personnel Security Branch requested documentation evidencing the paying down of
accumulated debts from the employee. The documentation tendered by the employee was determined to
be fraudulent. The employee also provided false information to the EPA concerning criminal history and
failed to pay accrued personal debts, which included an EPA travel card balance of $10,226. The
employee retired after being presented with a letter from EPA management of proposed removal.
CASE NUMBER: QI-DA-2014-CAC-0115
An EPA GS-9 employee allegedly stole two government-issued laptops valued at $4,156 for personal
gain. The subject of the investigation was no longer employed by the EPA when questioned by
investigators. The subject admitted culpability and returned the computers to the EPA. The case was
closed as there was no financial loss to the government. As the computers were new and scheduled for
imaging and distribution, no Personally Identifiable Information was found to be stored on the computers.
CASE NUMBER: QI-HQ-2015-ADM-0059
An EPA GS-09 employee allegedly committed a lewd act in an EPA restroom. The allegation was not
supported.
CASE NUMBER: QI-PH-2016-CAC-0076
An EPA GS-06 employee allegedly forged the initials of EPA employees on Freedom of Information Act
Approval Checklist documents, threatened an EPA employee, and bypassed the required Freedom of
Information Act online processing procedures. The investigation supported the allegation that the
employee forged Freedom of Information Act documents. The investigation was inconclusive regarding
the allegation of a threat, and it did not support the allegation that the employee bypassed the required
Freedom of Information Act online processing procedures. The employee resigned from the EPA prior to
the EPA management receiving the OIG report of investigation.
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Investigations Involving Non-Employees Not Publicly Disclosed
CASE NUMBER: QI-DA-2013-CFR-0093
A New Mexico native tribe, which received three EPA grants totaling almost $2 million, allegedly had
missing and/or incomplete quarterly reports, and drew down over $1 million for incurred costs that the
tribal council never paid. This investigation confirmed that the tribal council had overdue indirect cost rate
proposals, was non-responsive to OMB A-133 audit inquiries, submitted missing/incomplete quarterly
reports, and drew down money for incurred costs never paid. In addition, the U.S. Internal Revenue
Service revoked the council's non-profit status due to failure to submit tax returns for 3 years. Due to
these issues, the EPA placed the grant awards on termination status. The tribal council's former business
manager was responsible for all financial transactions, including maintenance of the accounting system
and the drawdown requests to the EPA. The investigation determined the business manager used grant
funds for unintended purposes, and the individual was debarred from participation in federal procurement
and non-procurement programs for 3 years.
CASE NUMBER: QI-DA-2013-CFR-0047
The investigation was initiated based on information received regarding possible bidding/competition
violations committed by an EPA contractor and its subcontractor. The investigation findings did not
support the allegation.
CASE NUMBER: QI-AT-2016-CAC-0050
A disinfection device company was allegedly displaying the EPA seal on its products and website without
authorization from the EPA. In addition, the company allegedly asserted in sales literature that its product
was "recommended or endorsed" by the EPA. The investigation confirmed that the official seals of the
EPA and the U.S. Department of Energy were prominently displayed on the company's homepage, linked
web pages and product literature. The EPA seal was also found to be displayed on the product itself. The
EPA issued a Cease and Desist Notice directing the company to cease imprinting the EPA seal on the
devices and to remove the seal from current devices in the facility, the company's website, brochures and
other print media. The OIG confirmed that the company complied with the cease and desist order.
CASE NUMBER: QI-AT-2015-CFR-0127
A trustee for a hazardous waste landfill allegedly conducted unpermitted hazardous waste treatment and
disposal operations. It was also alleged that the state's Department of Health and Environmental Control
falsely reported information to the EPA related to the landfill site. The investigation did not support the
allegation. A review of EPA records failed to identify any EPA funding directly linked to the site or the
Department of Health and Environmental Control's oversight activities of the site. As the complaint
alleged possible violations of federal environmental statutes, it was referred to the EPA Criminal
Investigation Division for follow-up investigation.
CASE NUMBER: QI-WI-2016-CAC-0101
A former EPA Criminal Investigation Division Special Agent allegedly called an EPA Office of the
Administrator employee and insisted on speaking to the EPA Administrator about alleged medical
mistreatment. The former employee allegedly became more agitated as the call progressed and used
excessive profanity, claiming lack of care on the part of the EPA. The Office of the Administrator
employee felt that the caller was seriously unstable and might "take some kind of action." The
investigation found that the former employee had made profane and harassing communications to both
the EPA and the U.S. Department of Labor and its contract doctors. The OIG worked with the local police
department and the Federal Protective Service on the investigation. The local county attorney's office
accepted the case for prosecution and the former employee was charged with Harassing
Communications. A Dismissal Agreement was entered between the former employee and the county
attorney whereby the former employee agreed to have no further contact with the EPA and to make no
threatening communications to the U.S. Department of Labor. The county attorney agreed to dismiss
without prejudice the charges in the summons. Any violation of the terms in the agreement will result in
the former employee being arrested and charged.
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CASE NUMBER: OI-AR-2Q11-CFR-2785
An EPA contractor who was a manager at an EPA records center allegedly had performance issues and
made threatening statements to colleagues. Though the investigation did not determine any criminal
activity had occurred, the company president determined there was merit to the accusations and
terminated the manager.
CASE NUMBER: QI-AR-2011-CFR-2780
There were allegations of potential fraud related to a Clean Water State Revolving Fund stimulus grant
awarded to a municipality. There was also an allegation of a potential conflict of interest by an employee
who had been employed with both the municipality and the contractor. The investigation was unable to
identify any direct federal funds going toward purchases for equipment by the municipality. The
investigation also was unable to determine any direct EPA funding tied to the allegation. The financial
matter was subsequently referred to the EPA OIG Office of Audit for further analysis.
CASE NUMBER: QI-AR-2013-CFR-0015
A former official for a tribe pleaded guilty to one count of embezzlement and theft from an Indian tribal
organization. Over a 6-year period, the former official traveled in an official capacity as the environmental
director for the tribe, sought and received reimbursement totaling approximately $25,000 for travel
expenses from third parties, and then converted that reimbursement to their own use. Because the former
official was already reimbursed for the costs of that travel, the third-party reimbursement belonged to the
tribe and not the individual. The former official was sentenced to 1 year of probation.
CASE NUMBER: QI-AR-2014-CAC-0102
A U.S. General Services Administration contractor was arrested while attempting to steal two construction
lights, copper piping, one laptop, two hard drives, and 18 mobile devices from the EPA headquarters
building. A search warrant was obtained and executed on the residence of the contractor, where
additional laptops and hard drives were seized. The contractor pleaded guilty to one count of destruction
of property less than $1,000 and one count of theft second degree. The contractor was sentenced to
180 days of incarceration, suspending all but the days required to place the contractor in a residential
drug treatment program, as well as 18 months of probation and restitution of $500.
CASE NUMBER: QI-SA-2016-CAC-0102
An EPA contractor allegedly heard a member of the public threaten to shoot an EPA On-Scene
Coordinator in the head if they met to discuss cleanup on the person's property. The subject was
interviewed and denied making the statement. The EPA On-Scene Coordinator sought and was granted a
30-day protection order by a local judge.
CASE NUMBER: QI-AR-2012-CFR-0159
Allegations of potential fraud related to EPA grants awarded to an environmental institute were made.
Specifically, it was alleged that the grantee had an inappropriate relationship with a subcontractor. It was
further alleged that the grantee may have provided kickbacks to EPA employees to secure the grants.
Although the allegations were not supported, it was found that the subcontractor had unintentionally not
completed its application for women-owned small business status, even though the grantee claimed the
subcontractor's work on the grants toward the grants' disadvantaged business enterprise requirements.
Upon notification by the EPA OIG, the subcontractor took corrective action and ensured completion of its
status. Additionally, because of weaknesses identified regarding the EPA's grant disadvantaged business
enterprise requirements, the OIG issued a Management Implication Report to the EPA's Office of Grants
and Debarment to notify it of the weaknesses.
CASE NUMBER: QI-AT-2015-CAC-0118
An environmental industrial cleaners company allegedly continued to associate its products on its website
and sales materials with the EPA Safer Choice Program—previously known as the Design for the
Environment Program—after its partnership with the EPA program was terminated. It was also alleged
that the company provided false information to the EPA program to obtain its initial Design for the
Environment Program partnership. The first allegation was supported; the latter allegation was not.
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The investigation confirmed that the product literature for nine of the company's products displayed the
program logo. In addition, the company's sales materials made claims associating its products with the
EPA. The EPA ordered the company to remove the program logo from its website and sales materials.
The OIG confirmed that all logos and references to participation in the EPA programs were removed from
the web pages and sales materials. Shortly thereafter, the company shut down its website completely.
CASE NUMBER: OI-HQ-2017-CAC-002Q
After an EPA GS-12 employee received notice of termination of employment and was escorted to the
office to remove personal items, the former employee allegedly made a threatening gesture and comment
toward the supervisor. Witness interviews were conducted, and the investigation supported the allegation.
Because the employee was removed from federal service, the case was closed. The case was declined
for prosecution by DOJ.
CASE NUMBER: QI-DA-2015-CFR-0121
A watershed protection committee allegedly submitted false information to obtain grant funds under the Clean
Water Act. The review of budget information submitted by the committee disclosed numerous discrepancies
with regard to summary-level budget information when compared to detailed information provided. Interviews
of stakeholders disclosed there was no agreement for the grantees to provide grant matching funds from their
budgets to the EPA. Interviews of personnel who prepared the budget plan disclosed information that
stakeholders had provided tacit approval for the matching funds. The overall findings indicated that
miscommunication and misunderstanding with regard to matching fund commitments and in-kind matching
services led to the allegations made. The allegation was not supported and the investigation was closed.
CASE NUMBER: QI-SA-2016-CAC-0088
The EPA Region 9 mailroom in San Francisco, California, received a suspicious letter from an
individual. In the letter, the individual claimed to have been assaulted, tortured and almost murdered by a
bioterrorism group masquerading as a film crew in Los Angeles, California. The individual included a
tissue with what appeared to be blood on it and asked for it be analyzed because it contained a
"biological weapon consisting of a vector by which a fungal infection is introduced into a human target."
The investigative liaison with the Federal Bureau of Investigation, U.S. Postal Inspection Service, and
local police determined that the subject had a history of mental illness and was a known letter writer to
various public officials. The case was declined for prosecution by DOJ. A security notice was posted at
the Region 9 EPA building and the case was closed.
CASE NUMBER: QI-SE-2015-CFR-0110
The administrator of an Alaskan tribe allegedly misappropriated EPA grant funds for personal use and/or
use of family members totaling approximately $615,000. A financial analysis of the payroll records, bank
statements, checks and Automated Clearing House transactions of the tribe was conducted. The analysis
showed no information to support the allegation.
CASE NUMBER: QI-SA-2014-CAC-0066
A former tribal administrator and the tribe's enrollment clerk allegedly embezzled EPA grant funds.
Records showed that, while employed with the tribe, the tribal administrator and enrollment clerk were
fraudulently paid from an account in which EPA grant funds were commingled. Through interviews and
document reviews, it was discovered that the tribal administrator and the clerk received approximately
$16,500 in addition to their salary with no justification or supporting documentation. In addition, OIG
agents learned that the tribal administrator was being investigated by the National Gaming Commission
and U.S. Internal Revenue Service for receiving an additional $27,500 from the tribe's casino account
(no EPA funds). The allegations were supported, and the tribal administrator and the clerk were charged
with one count of Grand Theft in the Superior Court of California. However, due to reasonable doubt and
low dollar amount, the District Attorney's office later dropped the charge.
CASE NUMBER: QI-AR-2012-CFR-0175
An EPA subcontractor allegedly misrepresented himself as an employee of the prime contractor. The
investigation determined a teaming arrangement had existed between the subcontractor and the prime
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contractor and that the subcontractor mistakenly believed he could represent himself as the prime
contractor to the EPA. The investigation did not identify any criminal activity, and the case was closed.
CASE NUMBER: QI-NE-2017-CAC-0029
A potential threat was sent in a letter to then EPA Administrator Gina McCarthy. A preliminary review of
the letter by investigators did not yield evidence of an actual threat to the Administrator or any EPA entity
in the letter itself. The letter contained disjointed thoughts and tended to ramble. The author of the letter
had been interviewed by an outside law enforcement agency in 2015, and it was not believed that the
individual posed any threat. Based on the inability to discern any actual threat in the mailing, the results of
prior interaction with law enforcement, and the notification of Administrator McCarthy's detail as to the
investigative results, the case was closed.
CASE NUMBER: OI-SA-2016-CFR-001Q
An Alaskan tribal council was allegedly fraudulently billing hours on an EPA Indian General Assistance
Program grant. After contacting the assigned EPA grant specialist, it was found that a post-award
monitoring desk review was already underway. The purpose of the review was to examine the council's
administrative and financial management of EPA grants, as well as its adherence to the terms and
conditions of the grants. Supporting documentation related to three drawdowns for grant expenditures
was reviewed. No system weaknesses or deficiencies were found. The EPA found the council's financial
management and administration of EPA grants to be in compliance with applicable federal regulations.
The allegation was not supported.
CASE NUMBER: QI-SE-2013-CAC-0033
Two immersion survival suits were stolen from an EPA laboratory. In a joint investigation with the county
sheriff's office, a subject was identified and arrested during a sting operation for possessing stolen EPA
property. A search of the subject's cell phone yielded several photos of additional EPA property that was
previously listed on a sales website and identified as stolen from the EPA lab. The individual entered into
a felony diversion agreement with the county prosecuting attorney's office.
CASE NUMBER: OI-AR-2014-CFR-007Q
A company allegedly used the letters "EPA," which could possibly gain that company an unfair marketing
advantage. The case was referred to EPA's Office of General Counsel. The office determined that the
use of the letters "E-P-A" and lack of any overt claim of a connection with the U.S. Environmental
Protection Agency did not warrant action from the office. The case was closed.
CASE NUMBER: OI-HQ-2016-CAC-00Q9
The OIG discovered a threatening post on a social media website. The threat was directed at then EPA
Administrator Gina McCarthy. The OIG coordinated efforts with federal, state and local law enforcement
agencies. Additional security personnel were added to the residence of the former Administrator. Due to
the inability to identify a subject, and a change of the Administrator position, the case was closed.
CASE NUMBER: QI-AT-2017-CAC-0044
A masonry company allegedly used labels and logos associated with the EPA Safer Choice Program—
previously known as the Design for the Environment Program—without authorization on its website and
product sales materials. The investigation confirmed the EPA program logo was prominently displayed on
the company's website and sales materials. A review of EPA records confirmed that neither the company,
its parent company, nor its products were partnered with the EPA program. The EPA issued a Cease and
Desist Notice directing the company to cease printing the EPA program logo on brochures, and to remove
the logo from the company website. The OIG confirmed the removal of the program logos from the
company's website and sales materials.
CASE NUMBER: QI-AT-2016-CAC-0104
A former EPA employee allegedly failed to return an EPA-issued laptop and a cell phone after separating
from the agency. It was also alleged that the former employee failed to respond to the EPA's requests to
return the property. The former employee was contacted and made aware of the investigation by the OIG,
and subsequently returned the property to the EPA.
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CASE NUMBER: QI-DE-2017-CAC-0055
A former EPA employee posted potentially threatening statements on a current EPA employee's social
media website. The former employee was interviewed, admitted to posting the comments, and apologized
for the post. A "Be on the Lookout Notice" was issued and provided to two EPA regions regarding the
former employee.
CASE NUMBER: QI-AR-2016-CAC-0033
An EPA contractor allegedly conducted outside business during work hours on an EPA contract. The
investigation determined that the contractor had used her EPA email account and scanner to send herself
invoices pertaining to the other job. However, it amounted to approximately 20 minutes each month and
did not necessarily occur during official work hours. No action was taken, as the contractor was no longer
working on the EPA contract and it appeared that she mistakenly believed it was authorized as
"de minimis."
CASE NUMBER: QI-HQ-2017-ADM-0022
An EPA employee reported becoming ill after consuming baked goods purchased from a bake sale at the
EPA. The employee reported that the baked goods "smelled odd." The OIG investigated whether another
EPA employee had intentionally provided tainted baked goods for the bake sale. The investigation
determined that the employee who had provided the baked goods had inadvertently melted the bags
containing the baked goods while affixing decorations with a hot glue gun. The employee removed the
items from the bake sale once it was realized that they were contaminated. No evidence of malicious
activity was found.
CASE NUMBER: QI-NE-2013-CAC-0086
The OIG and the Federal Protective Service were notified of a plastic bag containing a white powder
found in an EPA employee's cubicle; the agencies conducted the investigation jointly. Subsequent testing
of the substance confirmed that the material did not present any potential hazard. The investigation did
not identify any individual who may have left the white powder, but did disclose that the material in the
bag appeared to be a variety of deodorizers and was left at that location due to complaints regarding
offensive odors in the office.
CASE NUMBER: QI-DE-2017-CAC-0065
A North Dakota man allegedly threatened to shoot two EPA employees and a pipeline employee who
were attempting to make contact with the man at his residence surrounding clean-up efforts associated
with an oil spill on the man's property. Due to the remote location of the incident, the county sheriff's
department mediated the incident on behalf of the OIG to the satisfaction of all parties. Through
interviews of members involved, it was determined that the man was making indirect comments regarding
the gravel trucks speeding through his property, and not threatening the three employees. All members
agreed is was a miscommunication. The allegation was not supported.
CASE NUMBER: QI-AT-2015-CAC-0129
A pest control company was allegedly displaying the EPA logo on its website and promotional materials
without authorization from the agency. The investigation determined that the EPA logo referenced in the
complaint was actually the official EPA identifier, not the agency's seal. EPA officials had previously
contacted the company and requested that the logo in question be removed from its website; however, no
action was taken by the company. The EPA issued a Cease and Desist Notice directing the company to
cease the use of the identifier on its website and other media. Again, the company failed to comply with
the order. Further investigation identified several pest control companies operating under the name of the
subject company. It was determined that three of the companies were operated by one individual, and
only those companies were using the EPA identifier on their websites. Investigators contacted the
company and were told that the identifier was removed from all three websites. The OIG confirmed that
the EPA identifier had indeed been removed from all three websites and accompanying web links.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Appendix 5—Peer Reviews Conducted
Audits/Evaluations
The Social Security Administration OIG completed an external peer review of the EPA OIG audit
organization (which includes the EPA OIG's Office of Audit and Office of Program Evaluation)
covering the fiscal year ended September 30, 2014, and issued its report on June 12, 2015. The
review was conducted in accordance with guidelines established by the Council of the Inspectors
General on Integrity and Efficiency. The external peer review of the EPA OIG audit organization
stated that the EPA OIG audit organization's system of quality control was suitably designed and
complied with to provide the EPA OIG with reasonable assurance of performing and reporting in
conformity with applicable professional standards in all material respects, and the EPA OIG
received a rating of pass.
The EPA OIG conducted an external peer review of the system of quality control for the audit
organization of the U.S. Department of Education OIG. Our review covered the period April 1,
2012, through March 31, 2015. We conducted the review in accordance with Government
Auditing Standards and guidelines established by the Council of the Inspectors General on
Integrity and Efficiency. We provided a final report to the U.S. Department of Education OIG on
October 27, 2015. In our opinion, the U.S. Department of Education OIG audit organization's
system of quality control in effect for the year ending March 31, 2015, was suitably designed and
complied with to provide that OIG with reasonable assurance of performance and reporting in
conformity with applicable professional standards in all material respects. The U.S. Department of
Education OIG received an external peer review rating of pass.
Investigations
The Federal Deposit Insurance Corporation OIG completed a mandated Council of the Inspectors
General on Integrity and Efficiency quality assurance review of the EPA OIG Office of
Investigations and issued its report on December 2, 2014. The Federal Deposit Insurance
Corporation identified no deficiencies and found internal safeguards and management
procedures compliant with quality standards.
In November 2014, an EPA OIG inspection team began performing a quality assurance review of
the U.S. Department of Education OIG Investigation Services office, per the Council of the
Inspectors General on Integrity and Efficiency. We issued our final report on September 15, 2015.
Overall, in our opinion, the system of internal safeguards and management procedures for the
investigative function of the Department of Education OIG for the year ended October 30, 2014,
was in compliance with standards established by the Council of the Inspectors General on
Integrity and Efficiency and Attorney General guidelines.
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Semiannual Report to Congress
October 1, 2016—March 31, 2017
Appendix 6—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, Suite 12-T-24
Atlanta, GA 30303
Audit/Evaluation: (404) 562-9830
Investigations: (404) 562-9857
Boston
U.S. Environmental Protection Agency
Office of Inspector General
5 Post Office Square, Suite 100 (OIG15-1)
Boston, MA 02109-3912
Audit/Evaluation: (617) 918-1470
Investigations: (617) 918-1466
Chicago
U.S. Environmental Protection Agency
Office of Inspector General
77 West Jackson Boulevard
13th Floor (IA-13J)
Chicago, IL 60604
Audit/Evaluation: (312) 353-2486
Investigations: (312) 353-2507
Cincinnati
U.S. Environmental Protection Agency
Office of Inspector General
26 West Martin Luther King Drive
Cincinnati, OH 45268-7001
Audit/Evaluation: (513) 487-2363
Investigations: (312) 353-2507
Offices
Dallas
U.S. Environmental Protection Agency
Office of Inspector General (60IG)
1445 Ross Avenue, Suite 1200
Dallas, TX 75202-2733
Audit/Evaluation: (214) 665-6621
Investigations: (214) 665-2249
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, KS 66219
Audit/Evaluation: (913) 551-7878
Investigations: (214) 665-2249
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) 814-2359
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)
8th Floor
San Francisco, CA 94105
Audit/Evaluation: (415) 947-4527
Investigations: (415) 947-8711
Seattle
U.S. Environmental Protection Agency
Office of Inspector General
Mail Code OIG-173
1200 Sixth Avenue, Suite 900
Seattle, WA 98101
Audit/Evaluation: (206) 553-6906
Investigations: (206) 553-1273
Winchester
U.S. Environmental Protection Agency
Office of Inspector General
200 S. Jefferson Street, Room 314
P.O. Box 497
Winchester, TN 37398
Investigations: (423) 240-7735
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