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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
13-P-0163
February 20, 2013
Why We Did This Review
We performed this review to
evaluate the U.S. Environmental
Protection Agency's (EPA's)
assessment and collection of
accreditation and certification fees
for its lead-based paint program.
Our objectives were to determine
whether EPA is recovering its
costs of administering the lead-
based paint program, and whether
EPA has effective internal controls
over the assessment and
collection of fees.
The Toxic Substances Control Act
(TSCA) directs EPA to address
the general public's risk of
exposure to lead-based paint
hazards. EPA's Office of Pollution
Prevention and Toxics (OPPT)
administers the national training
and certification systems for lead
abatement and renovation
activities. TSCA authorizes EPA to
establish fees to recover the costs
of administering and enforcing the
standards and requirements
applicable to lead-based paint
training programs and contractors.
This report addresses the
following EPA Goal or
Cross-Cutting Strategy
• Strengthening EPA's workforce
and capabilities.
For further information,
contact our Office of Congressional
and Public Affairs at (202) 566-2391.
The full report is at:
www.epa.qov/oiq/reports/2013/
20130220-13-P-0163.pdf
EPA Is Not Recovering All Its Costs of the
Lead-Based Paint Fees Program
What We Found
EPA is not recovering all its costs of administering the lead-based paint program.
Our analysis, based on the Agency's rough cost estimates, showed unrecovered
costs of $16.4 million for fiscal years (FY) 2010 through 2014 combined.
Although collections exceeded costs by $8.9 million in FY 2010, for FYs 2011
through 2014 costs exceeded collections by $25.3 million, thus the net difference
of $16.4 million. In a 2009 final rule, EPA established a fee schedule under the
authority of TSCA to recover the program costs incurred over a 5-year
certification cycle. However, EPA is not recovering all its costs because:
•	Renovation, Repair, and Painting firm participation is lower than projected.
•	EPA has not conducted a biennial cost review to determine its actual costs
and decide whether it needs to adjust fees to reflect changes in costs.
•	The fees structure does not take into account all indirect costs needed to
recover the full cost of administering the lead-based paint program.
By not recovering all of its program costs, the federal government did not collect
funds that otherwise could have been available to offset the federal budget
deficit. A fees rule update could result in additional revenue of up to
$16.4 million per 5-year cycle.
EPA's internal controls over the assessment and collection of fees are generally
effective.
Recommendations and Planned Agency Corrective Actions
We recommend that the Assistant Administrator for Chemical Safety and
Pollution Prevention update the March 2009 fees rule to reflect the amount of
fees necessary to recover the program costs, and apply indirect cost rates to all
applicable direct costs to obtain the full cost of the program (the Chief Financial
Officer has agreed to develop the indirect cost rates). We also recommend that
the Chief Financial Officer conduct biennial cost reviews of the lead-based paint
fee collections and the full cost of operating the program to determine whether
EPA is recovering its costs, and determine the appropriate Agency indirect cost
rates to be used for EPA's user fee programs.
EPA agreed with all our recommendations. EPA said it will update the 2009 fees
rule, modify cost analysis procedures as appropriate, conduct biennial cost
reviews, and develop appropriate indirect cost rates for user fee programs. The
two recommendations to the Assistant Administrator for Chemical Safety and
Pollution Prevention are unresolved pending receipt of estimated completion
dates.

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