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*	U.S. Environmental Protection Agency	13-R-0321
-	July 19,2013
•	UiOi d IVII Ul 111ICII Id I 1 I Uldr II
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At a Glance

Why We Did This Review
The U.S. Environmental
Protection Agency (EPA),
Office of Inspector General,
reviewed the contracts
awarded by the Tennessee
Department of Transportation
(TDOT) under Cooperative
Agreement No. 95425709.
The agreement, funded by the
Diesel Emissions Reduction
Act (DERA) under the
American Recovery and
Reinvestment Act of 2009
(Recovery Act), provided for
the installation of truck stop
electrification (TSE) facilities.
DERA provides funds for EPA
programs to achieve significant
reductions in diesel emissions.
The purpose of the audit was to
determine whether TDOT
complied with procurement
requirements, monitored
contract performance,
achieved the objectives of the
cooperative agreement, and
accurately reported the results
to EPA.
This report addresses the
following EPA Goal or
Cross-Cutting Strategy:
• Taking action on climate
change and improving
air quality.
For further information, contact
our Office of Congressional and
Public Affairs at (202) 566-2391.
The full report is at:
Projected Emission Reductions Overstated and
Buy American Requirements Not Met Under EPA Award
to the Tennessee Department of Transportation
What We Found
TDOT followed most applicable laws, regulations, and terms and conditions of
the cooperative agreement in the procurement and monitoring of contracts for the
TSE facilities—with the exception of the Buy American requirements of the
Recovery Act. TDOT did not determine whether trusses used in the construction
of TSE facilities by one contractor qualify as substantial transformation as defined
in 2 CFR §176.160. This occurred because subsequent to the contract awards,
EPA incorrectly determined that the Buy American requirements did not apply to
the project. Consequently, there is no assurance that all iron, steel, or
manufactured goods incorporated into the project were manufactured or
substantially transformed in the United States, as required by Section 1605 of the
Recovery Act.
TDOT complied with the cooperative agreement requirements and satisfied
Region 4 requirements for projecting results. However, TDOT overstated its
results. This occurred because TDOT utilized significantly overestimated usage
assumptions in its projections rather than current usage. As a result, TDOT does
not have reasonable assurance that the TSE project will achieve projected
emissions reductions, and the expected environmental results and human health
benefits. Quarterly reporting of diesel emissions reductions by the DERA
program may also be overstated.
We recommend that EPA disallow and recover Recovery Act funds of
$1,623,049, unless TDOT can certify that the project fully complied with Buy
American requirements. For those items that TDOT cannot certify, EPA should
follow applicable regulations to resolve the noncompliance.
ForTDOT's potential overstatement of project results, we recommend that EPA
review TDOT's assumptions used to calculate projected results. If needed, EPA
should work with TDOT to develop a more accurate projection of project results.
EPA should also review any recalculated results, in accordance with agency
policy, to determine whether TDOT achieved the objectives of the cooperative
agreement. Further, EPA should adjust the DERA program reporting of TDOT
project results to reflect any recalculated results.
EPA and TDOT disagreed with recommendations pertaining to the Buy American
requirements. EPA and TDOT agreed with the recommendation related to project
results and are working to use post-project usage data to produce updated