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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
13-R-0092
January 7, 2013
Why We Did This Review
The U.S. Environmental
Protection Agency, Office of
Inspector General, conducts
site visits of American
Recovery and Reinvestment
Act of 2009 (Recovery Act)
clean water and drinking water
projects. The purpose of this
visit was to address a hotline
complaint involving compliance
with the Recovery Act's Buy
American requirements by the
City of Goshen, Indiana. We
also reviewed contract
procurement.
The City of Goshen received a
$36.1 million loan from the
Indiana Finance Authority.
The loan included $5 million in
Recovery Act funds. The city
used these funds to construct a
new combined sewer overflow
detention facility.
American Recovery and Reinvestment Act Site Visit
of Combined Sewer Overflow Detention Facility,
City of Goshen, Indiana
What We Found
We conducted a site visit of the Recovery Act project to build a new combined
sewer overflow detention facility in the City of Goshen, Indiana, in December
2011. As part of our site visit, we toured the project, interviewed city officials and
engineering personnel, and reviewed documentation maintained by the city
related to both the Buy American requirements of the Recovery Act and contract
procurement.
The equipment identified in the hotline complaint was produced in the United
States and complied with the Buy American requirements, as set out in Section
1605 of the Recovery Act. However, the city could not demonstrate that a
positive displacement blower used in the project was manufactured in the United
States, as required by the Recovery Act. Since Goshen cannot demonstrate that
all equipment items used on the project complied with the Buy American
requirements, the project is not eligible for the $5 million of Recovery Act funds
authorized by the state unless the U.S. Environmental Protection Agency
exercises a regulatory option.
Recommendation
We recommend that the Regional Administrator, Region 5, employ the
procedures set out in the Code of Federal Regulations (CFR) at 2 CFR  176.130
to ensure compliance with Buy American requirements. If the region decides to
retain the foreign manufactured goods in the project under 2 CFR 176.130
(c)(3), the region should either "reduce the amount of the award by the cost of the
[foreign] steel, iron, or manufactured goods that are used in the project" or "take
enforcement or termination action in accordance with the agency's grants
management regulations."
The city did not agree with our conclusion or recommendation.
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/
20130107-13-R-0092.pdf

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