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*. U.S. Environmental Protection Agency	17-P-0395
\ Office of Inspector General	September 18,2017
. .. At a Glance
Why We Did This Review
The U.S. Environmental
Protection Agency (EPA), Office
of Inspector General (OIG),
performed this audit to determine
whether the EPA manages the
Pesticides Reregistration and
Expedited Processing Fund
(known as the FIFRA Fund) and
the Pesticide Registration Fund
(known as the PRIA Fund)
effectively to minimize reliance on
appropriated funds.
The EPA is responsible for
reassessing the safety of older
pesticide registrations against
modern health and environmental
testing standards. To expedite this
reregistration process, Congress
authorized the EPA to collect
maintenance fees from pesticide
manufacturers. The fees are
deposited into the FIFRA Fund.
In addition, to expedite the
registration of certain pesticides,
Congress authorized the EPA to
assess and collect pesticide
registration fees, which are
deposited into the PRIA Fund.
This report addresses the
following:
• Operating efficiently and
effectively.
Send all inquiries to our public
affairs office at (202) 566-2391
or visit www.epa.aov/oia.
Listing of OIG reports.
EPA Needs to Manage Pesticide Funds
More Efficiently
What We Found
The EPA should manage the FIFRA and PRIA
Funds more effectively by reducing excess fund
balances to within a target range. As of
September 30, 2016, we identified excess funds
of approximately $21.4 million for FIFRA and
$8.5 million for PRIA, for a total of $29.9 million.
A reduction in fund balances would increase the
availability of appropriated funds for other
environmental purposes.
The EPA used more appropriated funds to cover operating expenses than was
necessary and allowed the fund balances to trend up to levels higher than
needed for current operations. According to the U.S. Government
Accountability Office, it is important for entities with operating reserves to
establish appropriate target amounts using a risk-based strategy to efficiently
use resources. However, the EPA did not establish a target range for its
FIFRA and PRIA Funds.
FIFRA and PRIA Fund balances did not agree with the corresponding liabilities
from pesticide registrant fee payments because the EPA did not reconcile the
accounts. The EPA records a liability for the fees collected until it completes
the pesticide review. The U.S. Government Accountability Office includes
reconciliations among its standard internal control activities for management to
respond to internal control risks. Without performing periodic reconciliations,
the EPA cannot confirm the accuracy of its FIFRA and PRIA recorded
liabilities.
Recommendations and Planned Agency Corrective Actions
We recommend that the Assistant Administrator for Chemical Safety and
Pollution Prevention establish a target range for its FIFRA and PRIA Fund
balances and develop and implement a plan to reduce excess funds to within
the target range. We also recommend that the Chief Financial Officer reconcile
the FIFRA and PRIA Funds' balances to the corresponding liabilities.
The agency concurred with establishing a target range and developing a plan
to reduce excess funds for FIFRA Fund balances. The agency did not agree
with establishing a target range and developing a plan to reduce excess funds
for PRIA Fund balances, citing the lack of predictability of PRIA collections.
We still believe PRIA has excess funds that should be addressed. The agency
agreed to reconcile FIFRA and PRIA balances.
With improved funds
management, the
EPA may achieve
maximum use of its
FIFRA and PRIA
Funds and will reduce
the reliance on
appropriated funds.

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