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U.S. Environmental Protection Agency	18-p-oo38
November 15, 2017
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	 \ Office of Inspector General
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At a Glance
Why We Did This Review
The U.S. Environmental
Protection Agency (EPA),
Office of Inspector General
(OIG), conducted this audit to
address concerns identified in a
previous audit regarding the
agency's use of high-risk bridge
contracts. Our audit objective
was to determine whether the
EPA is performing acquisition
planning and conducting
market research to promote
competition and avoid high-risk
contracting authorities.
The March 4, 2009,
Presidential Memorandum on
Government Contracting
reports that noncompetitive and
cost-reimbursement contracts
have been misused across the
federal government, resulting in
wasted taxpayer resources,
poor contractor performance
and inadequate accountability.
Office of Management and
Budget Memorandum M-09-25,
Improving Government
Acquisition, issued on July 29,
2009, requires agencies to take
action to reduce the use of
high-risk contracting
authorities.
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.gov/oia.
Improved Acquisition Planning Will Help EPA Reduce
Hundreds of Millions of Dollars in High-Risk Contracts
Without improving its
acquisition planning process,
the EPA may continue to spend
hundreds of millions of dollars
on high-risk contracts that
waste taxpayer resources.
What We Found
The EPA's use of high-risk contracts could be
reduced if the agency implements additional
internal controls to strengthen and improve
its acquisition planning process. Low-risk,
firm-fixed-price contracts represented only
nine percent of the agency's total contract
obligations in the second quarter of FY 2017.
Other contracting vehicles pose higher risks to the EPA because they put the
burden of cost risk on the government.
We also found that planning difficulties were cited as factors in each of the
10 sole source bridge contracts we sampled, which were awarded to extend
existing contracts without full and open competition. The EPA allowed sole
source contracts even when there was adequate time to plan and conduct a
competitive award process. In addition, two of the sampled contracts did not
document acquisition planning as required by EPA policy and federal regulations.
Recommendations and Planned Agency Corrective Actions
We recommend that the Office of Administration and Resources Management
take the following actions:
•	Require the use of low-risk contracts and only permit high-risk contracts
when low-risk contracts are not possible.
•	Tighten scrutiny of the contract type selection and require higher level
approvals for high-risk contracts.
•	Issue guidance or policy to program offices and contracting staff regarding
requirements for sole source bridge contracts.
•	Permit sole source bridge contracts only when adequate and timely planning
has occurred and when serious injury to the EPA's mission would result from
a lapse of service.
•	Develop a tracking mechanism for bridge contracts.
•	Issue a memorandum to remind staff of the importance of including
acquisition planning documents as part of the official contract records.
We also recommend that the EPA Deputy Administrator issue an agencywide
memorandum to advocate and support Office of Administration and Resources
Management initiatives to achieve greater use of contracts that minimize risk and
maximize value to the government, including reducing the use of high-risk
contracts.
Listing of OIG reports.
The EPA agreed with the recommendations and provided proposed corrective
actions and completion dates. The proposed and completed corrective actions
meet the intent of the recommendations.

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