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Office of Inspector General
Audit Report
SUPERFUND
Update on Brownfields Initiative
to Revitalize Urban Areas
2000-P-00027
September 29, 2000

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Inspector General Division(s)
Conducting the Audit
Region(s) covered
Program Office(s) Involved
Headquarters Audit Division
Washington, DC
Regions 1, 4, 5, and 9
Outreach and Special Projects Staff
Office of Solid Waste and Emergency
Response

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MEMORANDUM
SUBJECT:
FROM:
TO:
Update on Brownfields Initiative to Revitalize Urban
Areas
Audit Report No. 2000-P-00027
Frances E. Tafer Is/
Audit Manager
Headquarters Audit Division
Timothy Fields, Jr.
Assistant Administrator for
Solid Waste and Emergency Response
This report concludes our follow-up audit of EPA's Brownfields Initiative.
Generally, we found that Agency efforts to implement our previous recommendations
appear to be achieving the desired results. However, we found that: 1.) the cleanup
loan fund pilots have been slow to make loans; and 2.) the site assessment pilot
selection and reporting processes should be better documented and more timely,
respectively.
This report describes additional findings and corrective actions the Office of
Inspector General (OIG) recommends to improve the Brownfields Initiative. As such, it
represents the opinion of the OIG. Final determinations on matters in the report will be
made by EPA managers in accordance with established audit resolution procedures.
Accordingly, the issues described in this report do not necessarily represent the final
EPA position and are not binding upon EPA in any enforcement proceeding brought by
EPA or the Department of Justice.
In responding to the draft report and during the exit conference, your staff
provided corrective actions, with milestone dates, for each recommendation.
Therefore, no further response is required; and we are closing this report in our
tracking system upon issuance. Please track all corrective actions in the Management
Audit Tracking System (MATS). We have no objections to the further release of this
report to the public. Should your staff have any questions, please have them contact
Susan Lindenblad on (202) 260-0338.

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EXECUTIVE SUMMARY
INTRODUCTION	On March 27, 1998, the EPA Office of Inspector
General (OIG) issued a report, Brownfields: Potential
for Urban Revitalization (E1SHF8-11 -0005-8100091).
The report provided recommendations to improve the
Brownfields Initiative by focusing site assessment
grants on environmental assessments that provide
adequate quality assurance, and by offering training
and seeking legislative changes to improve the
Brownfields Cleanup Revolving Loan Fund (BCRLF)
grant program. The Office of Solid Waste and
Emergency Response (OSWER) agreed to
implement these recommendations.
The Agency defines brownfields as abandoned, idled,
or underutilized industrial and commercial facilities
where expansion or redevelopment is complicated by
real or perceived environmental contamination.
While the Brownfields Initiative does not address
sites with the greatest environmental risk, it does
address a major Administration goal involving several
Federal agencies which is to restore contaminated
urban land and buildings to productive use. The
Brownfields Initiative has continued to draw interest
from cities and other local governmental entities, as
well as Congress and the states.
OBJECTIVES	The objectives of our follow-up review were to
determine: whether the recommendations of the
original audit have been implemented and effective,
whether the grantees have instituted adequate quality
assurance and quality control procedures for site
assessments, and what actions EPA should take to
enhance BCRLF pilots' abilities to make loans to
clean up brownfields sites.
RESULTS IN BRIEF	The Agency has taken significant steps to implement
our previous recommendations. In general, these
efforts appear to be achieving the desired results.
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RECOMMENDATIONS
AGENCY COMMENTS
Brownfields Assessment Demonstration Pilot
proposals are more focused on site assessment than
they were before. The selection process, however,
would be improved with a few modifications and
better documentation. While the strength of regional
quality assurance programs varied, all regions
reviewed have considered the national guidance that
OSWER provided. Site assessment pilots are
providing better quarterly reports to EPA, but need to
improve on the timeliness of those submissions.
The BCRLF is, still, in need of additional flexibility
and time before its success can be fairly evaluated.
While many changes have been proposed and made
to the program, its pilots have been slow to make
cleanup loans. In the BCRLF's limited history, four
pilots have issued five loans and only one cleanup
has been completed.
We recommend that the Assistant Administrator for
Solid Waste and Emergency Response: (1) continue
efforts to implement the recommendations from our
original audit; (2) revise and better document the
results of the assessment pilot selection process; (3)
evaluate regional implementation of quality
assurance guidelines; (4) seek to add flexibility to
and, after gaining additional experience, obtain an
independent evaluation of the BCRLF program; and
(5) clarify and emphasize pilot reporting
requirements.	
The Agency agreed with our recommendations and
made plans to implement them. The comments also
suggested changes to clarify the report which we
made as appropriate. When fully implemented, we
believe EPA's plans will be responsive to our
recommendations. The Agency's comments are
included as Appendix I of our report.
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TABLE OF CONTENTS
Page
EXECUTIVE SUMMARY 	i
ABBREVIATIONS	 v
CHAPTER 1: INTRODUCTION 	 1
Purpose	 1
Background 	 2
Scope and Methodology 	 4
Prior Audit Coverage	 5
CHAPTER 2: Assessment Pilot Awards 	 7
Quality of Grant Proposals Has Improved	 7
Better Documentation Needed to Support Applications Selected for Award ... 9
Recommendations	 13
Agency Response and OIG Evaluation	 14
CHAPTER 3: Brownfields Quality Assurance 		15
Prior Recommendations Have Been Implemented by OSWER		15
Strength of Regional QA Programs Varied 		16
QAPPs Are Key to Valid and Useful Assessments 		19
Site Visits and Increased Communication Can Enhance
the Quality of Assessments 		21
Recommendations		22
Agency Response and OIG Evaluation		22
CHAPTER 4: The Brownfields Cleanup Revolving Loan Fund	 24
Status of the BCRLF Awards	 25
Impediments to Loan Issuance 	 26
Increasing Flexibility May Increase Loans From the BCRLF	 28
The Future of the BCRLFs	 29
Recommendations	 30
Agency Response and OIG Evaluation	 31
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CHAPTER 5: Brownfields Initiative Reporting		32
Reporting Brownfields Accomplishments Needs to be Timely		32
EPA is Working to Improve the Reliability of BMS Data 		33
Recommendations		36
Agency Response and OIG Evaluation		37
APPENDIX I: AGENCY RESPONSE		38
APPENDIX II: REPORT DISTRIBUTION		46
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ABBREVIATIONS
AA	Assistant Administrator
BCRLF	Brownfields Cleanup Revolving Loan Fund
BMS	Brownfields Management System
CERCLA	Comprehensive Environmental Response, Compensation, and
Liability Act
EPA	Environmental Protection Agency
GAO	General Accounting Office
GPRA	Government Performance and Results Act of 1993
NCP	National Oil and Hazardous Substances Pollution Contingency
Plan
OIG	Office of Inspector General
OSC	On-Scene Coordinator
OSPS	Outreach and Special Projects Staff
OSWER	Office of Solid Waste and Emergency Response
PM	Project Manager
QA	Quality Assurance
QAM	Quality Assurance Manager
QAPP	Quality Assurance Project Plan
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CHAPTER 1
INTRODUCTION
Purpose	To help the nation address environmental concerns
associated with the redevelopment and reuse of
industrial and commercial properties, EPA launched
the Brownfields Economic Redevelopment Initiative in
1993. The Agency defines brownfields as
abandoned, idled, or underutilized industrial and
commercial facilities where expansion or
redevelopment is complicated by real or perceived
environmental contamination.
The EPA Office of Inspector General (OIG) issued a
report, Brownfields: Potential for Urban Revitalization
(E1SHF8-11-0005-8100091), on March 27, 1998.
The report provided recommendations to improve the
Brownfields Initiative by focusing site assessment
grants on environmental assessments that provide
adequate quality assurance, and by offering training
and seeking legislative changes to improve the
Brownfields Cleanup Revolving Loan Fund (BCRLF)
grant program. The Office of Solid Waste and
Emergency Response (OSWER) agreed to
implement these recommendations.
The Brownfields Initiative has continued to draw
interest from cities and other local governmental
entities, as well as Congress and the states.
Therefore, the OIG began a follow-up audit to assess
the Agency's progress in implementing the
recommendations from the OIG's 1998 report,
including instituting quality assurance measures for
site assessments, and identification of improvements
to the BCRLF program to allow maximum use of
funds for brownfields cleanups.
Background	The Comprehensive Environmental Response,
Compensation, and Liability Act (CERCLA) §104(a)
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gives EPA broad authority to take response actions,
consistent with the National Hazardous Substances
Pollution Contingency Plan (NCP), to address
releases and threatened releases of hazardous
substances, pollutants, and contaminants. CERCLA
§104(b) authorizes EPA to undertake a variety of
studies and investigations, including monitoring,
surveys, testing, planning, and information gathering.
CERCLA §104 response actions may be taken at
sites at which a release or threatened release
occurred, regardless of whether those sites are listed
on the National Priority List. EPA's Office of General
Counsel has determined that EPA may address
brownfields using CERCLA §104 authorities and may,
pursuant to CERCLA §104(d) provide funds to states,
political subdivisions, and Indian Tribes to address
brownfields. While the Brownfields Initiative does not
address sites with the greatest environmental risk, it
does address a major Administration goal involving
several Federal agencies which is to restore
contaminated urban land and buildings to productive
use. Congress has approved an increasing budget
for the Brownfields Initiative to promote economic
redevelopment by assessing and cleaning up sites,
as described below.
EPA's efforts under the Brownfields Initiative can be
grouped into four broad and overlapping categories:
(1) providing grants1 for brownfields pilot projects; (2)
clarifying liability and cleanup issues; (3) building
partnerships and outreach among federal agencies,
states, municipalities, and communities; and (4)
fostering local job development and training
initiatives.
Brownfields pilot projects include these two
categories:
(1)	assessment demonstration pilots, and
(2)	BCRLF pilots.
' Wc use the term synonymously with cooperative agreement throughout this report.
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Both types of pilots are funded though grants
between EPA and any of the following: states,
political subdivisions (including cities, counties, or
regional governmental organizations), and Indian
Tribes. Most pilot projects have been awarded to
cities.
Assessment pilots are funded up to $200,000 each
and are designed to assist with environmental
activities prior to cleanup, such as site identification,
site assessment, and cleanup planning and design.
Pilot officials may apply for a follow-on supplemental
assessment grant, funded up to $150,000, for
continuing assessment activities. An additional
$50,000 in funding is available for assessing the
contamination of a brownfields site that is or will be
used for "greenspace" purposes such as parks,
playgrounds, trails, gardens, and open space.
The BCRLF pilots, each funded for up to $500,000,
provide funds from which low interest rate loans can
be made for the cleanup of brownfields sites. The
fund is replenished through repayment of principal
and interest, so that future loans can be made for
cleanup activities.
To obtain an assessment grant, an applicant must go
through a competitive award process administered by
EPA. The Agency establishes panels consisting of
personnel from a number of federal agencies to
review each application in accordance with a
predetermined set of criteria. The Assistant
Administrator (AA) for Solid Waste and Emergency
Response makes the final determination on awards.
To obtain a BCRLF grant, the applicant must have
previously been the recipient of an assessment grant
and submit an application addressing evaluation
criteria established by EPA. As of September 1999,
EPA had awarded a total of 304 assessment pilots
and 68 BCRLF pilots. The Agency's budget for
brownfields activities increased from $10 million in
fiscal year 1996 to $92 million for fiscal year 2000.
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Scope and Methodology	In January 2000, the Office of Inspector General
began a follow-up to our March 1998 audit report,
Brownfields: Potential for Urban Revitalization. We
obtained information from the Outreach and Special
Projects Staff (OSPS) within OSWER on actions
taken to implement recommendations included in the
prior report. We interviewed EPA Headquarters
personnel and reviewed program documentation. We
reviewed the brownfields application and evaluation
process and the Brownfields Management System at
Headquarters using information available in OSPS.
For our review of assessment and BCRLF grant
implementation, we visited Regions 1, 4, 5, and 9 and
interviewed the regional brownfields coordinators and
project officers and reviewed grant files. We visited
six brownfields assessment pilot cities and seven
BCRLF pilot cities and interviewed city/county
personnel, reviewed grant files, and visited several
brownfields properties.
For our review of assessment pilot awards, we drew a
statistical random sample of 42 pilot grants awarded
during fiscal year 1999, the first complete application
cycle since we issued our prior report in March 1998.
We reviewed the grant files to determine if the grant
applications contained the information required in
response to our previous audit recommendation. We
also compared the proposal evaluation criteria
currently used by the Agency to determine if they
included revisions responsive to the recommendation
in our prior report. We used a judgmental sample to
determine which brownfields pilots to visit to review
grants that had been awarded after we issued the
prior report and to focus on pilot projects which
involved activities requiring quality assurance
procedures.
Our audit fieldwork was conducted from February to
April 2000. Except as noted below, the audit was
conducted in accordance with Generally Accepted
Government Auditing Standards (Government
Auditing Standards, 1994 Revision). Since this was a
follow-up audit, we did not conduct an in-depth review
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Prior Audit Coverage
of internal controls, except for those specifically
mentioned in our prior report. The U.S. General
Accounting Office (GAO) recently issued a report on
a portion of OSWER's performance measures. The
report included some Brownfields measures which
were established as required by the Government
Performance and Results Act of 1993. Accordingly,
we did not review the adequacy of Brownfields
performance measures, but we do discuss reported
accomplishments in Chapter 5.
The OIG issued a report, Brownfields: Potential for
Urban Revitalization, (E1SHF8-11 -0005-8100091) on
March 27, 1998. In addition, GAO, in the
aforementioned report, Superfund: Extent to Which
Most Reforms Have Improved the Program Is
Unknown (GAO/RCED-00-118, May 12, 2000), noted
that brownfields assessment pilots are one of the few
Superfund administrative reforms reviewed that had
associated performance measures with demonstrated
positive outcomes: sites assessed, cleaned up, and
redeveloped.
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CHAPTER 2
Assessment Pilot Awards
Quality of Grant
Proposals Has Improved
To address the recommendations from our prior
report, the Agency revised its "Proposal Guidelines
for Brownfields Assessment Demonstration Pilots" in
October 1998. Our statistical sample of proposals
selected for review in this audit has shown that
prospective grantees are submitting proposals which
address the ranking factors contained in these
guidelines, and the revised evaluation criteria have
contributed to an overall improvement in the quality of
proposals. Although there have been substantive
revisions to the proposal evaluation criteria, they
could be further improved by emphasizing the need
for applicants to include project milestones for
completing tasks under the grant, and by ensuring
that proposals describe plans to use quality sampling
and analysis procedures. The integrity of the
selection process can be strengthened by
documenting the justification for selecting lower
ranked proposals over those that were ranked higher
during the evaluation process.
In our prior report, we recommended that the Agency
revise proposal evaluation criteria in order to give
credit and higher ranking to those cities whose work
plan (a) identified sites, (b) proposed to conduct site
assessments, (c) contained the largest number of
components of a redevelopment effort, (d) contained
specific objectives and milestones, and (e) contained
in-house technical expertise or a commitment for
obtaining or developing technical expertise. By
revising the evaluation criteria used for the selection
of pilot demonstration projects, we believed the
Agency would be encouraging cities to focus their
effort on those activities having the greatest potential
for promoting rapid site redevelopment. The Agency
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agreed to revise the pilot application evaluation
criteria in accordance with our recommendation.
In October 1998, the Agency issued its revised
"Proposal Guidelines for Brownfields Assessment
Demonstration Pilots." We compared the evaluation
criteria included in the proposal guidelines from our
prior audit with the 1998 criteria. We found that the
Agency made substantive revisions to the guidelines
to address almost all of the elements identified in the
recommendation from our prior report. The revisions
placed greater emphasis on the need for applicants
to describe or include project objectives, site
identification, site assessments, plans for
redevelopment projects, and in-house technical
expertise. Applicants are submitting proposals which
address these criteria to help improve their chances
of being awarded a brownfields site assessment
grant.
In our prior report we recommended that proposal
criteria be revised to give higher ranking to those
cities whose work plan contained specific objectives
and milestones. While the Agency has stressed the
need for specific objectives, the revised criteria did
not clearly emphasize the need for applicants to
include project milestones for completing tasks under
the grant. Our analysis showed that only 8 of the 42
proposals (19%) contained milestone dates. Another
11 (26%) identified interim accomplishments, but no
dates. However, 23 of the 42 proposals (55%) we
sampled did not include any type of project
milestones for completing tasks under the
assessment pilots. Having such information allows
both the EPA project officer and the grantee to
monitor progress and initiate corrective action when
progress is insufficient.
At the time of our first audit, the Agency had not
developed quality assurance guidance for
brownfields. It has since done so. The Agency's
revised guidelines for preparing proposals asks
applicants to describe plans to ensure the use of
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quality environmental sampling and analysis
procedures necessary for sound environmental
assessments of brownfields. In fiscal years 1998 and
1999, 27 percent of applicants planning to conduct
sampling did not address this factor. We believe it is
important that all proposals clearly emphasize plans
for quality sampling and analysis procedures to
ensure reliable and accurate site assessments.
OSWER could better assure that this occurs in
several ways. Proposal guidelines could be revised
to stress the need for applicants to address this
factor. If the proposal does not adequately address
quality sampling and analysis when it should, it could
be rejected outright or, after preliminary review, it
could be returned for further work.
OSWER officials told us that they have noticed a
significant improvement in both the proposal
presentation and the quality of information provided
as a result of the revised guidance. Our analysis of
the statistical sample confirms that the proposals are
much more focused on site assessment. Our first
audit looked at five of the earlier brownfields pilots
and found that of the $1 million dollars granted, less
than $150,000 was spent on actual site assessments.
The proposals that we reviewed for this audit indicate
that dollars spent on site assessment will be much
higher. Of the 42 proposals reviewed, 41 indicated
that the applicant planned to conduct site
assessments with the grant money and 35 of those
either identified specific sites or areas where site
assessments would be conducted.
Better Documentation Needed
to Support Applications
Selected for Award	EPA's proposal guidelines state that proposals must
be clear and decisive, strictly follow the criteria, and
provide sufficient detail for review panels to compare
the merits of each and decide which application best
supports the intent of the brownfields pilot program.
Brownfields assessment pilot grants are competitively
awarded, based on the evaluation of proposal
applications.
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Once OS PS receives proposals, they are sent to staff
from EPA headquarters, the regions, and
representatives from other federal agencies to be
reviewed and scored. Brownfields proposal
applications can earn a maximum of 20 points during
the scoring process based on how effectively the
proposals address EPA's evaluation criteria. In fiscal
year 1999 there were so many applications that
proposals were divided into three groups. Each
proposal was reviewed by 7 to 10 panelists. Upon
review of the proposals, scores were submitted to
OSPS to compute an average score and ranking for
the regional review panel(s).
We noted instances where the scoring of individual
proposals varied significantly among reviewers using
the same criteria. For example, out of the 20-point
maximum, we noted proposals which were scored
from 0 to 18, from 3 to 17.5, and from 6 to 20. With
this much deviation, individual ratings become less
meaningful. It could be that scores could become
more consistent with something as simple as a
handout to reviewers itemizing things that should or
should not be in the proposal. It may also be that
reviewers need to be chosen a little more carefully,
with an eye to their brownfields experience, or that
the rating criteria need to be clarified. As scores
become more consistent, they will become more
reliable and, therefore, there should be less need to
drastically deviate from the rankings.
There is an additional benefit to bringing consistency
to the rating process. If this occurs, it should be
possible to eliminate a step in the selection process.
Either the regional panels (discussed below) could be
eliminated, or the regional panels could collectively
assign the ratings, and the individual ratings could be
eliminated.
Each regional panel discussed all candidates for their
panel, but recommended only those proposals which
they believed best met the selection criteria. The
regional panels' recommendations were then
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reviewed by Headquarters program, grants, legal,
and enforcement personnel as necessary. They were
summarized and presented to the AA who, with input
from OSPS and regional personnel, made the final
award selections.
We reviewed the panel evaluations and
recommendations for selections made since our last
audit-fiscal years 1998 (round 8) and 1999 (round 9).
We found that in both years lower ranked proposals
were recommended and ultimately selected over
higher ones, and there was no documentation
showing why this occurred. This was most noticeable
in 1999, where proposals' initial ratings earned them
a ranking of first, second, and fifth when forwarded to
the convening regional panel (Panel C). However,
none of these proposals was selected for award after
review by OSPS. Additionally, the slate of candidates
from Panel C included a proposal ranked 45th (out of
47). We identified similar examples with regional
Panels A and B, where lower ranked proposals were
selected to go forward in the process while higher
ranked proposals dropped off the candidate slate;
however, we did not find deviations as extreme as
those from Panel C.
We discussed the results of our analysis with OSPS
officials. The Director of OSPS stated that the
numerical rankings developed for brownfields
assessment grant proposals are not really rankings
per se, but are designed to identify those proposals
which are clearly in the bottom, middle, and upper
tiers; and those proposals which are not likely
candidates for selection. The Director commented
that the regional panels do not generally consider the
need for national geographic coverage, a mix of sizes
of the cities submitting proposals, and tribal
representation, which are factored into the
Headquarters evaluation. The Director added that
the Headquarters review can involve soliciting advice
from grants, legal, and enforcement experts to
identify "fatal flaws" in applications. Furthermore, the
OSPS review smooths regional variances and adds
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an arm's length review removed from the initial
evaluation process.
The AA provided us with a valid explanation as to
why the number one ranked proposal from Panel C
did not receive an award. He stated that it was not
accepted because the city already had an existing
brownfields assessment pilot. In an effort to involve
as many entities as possible, EPA has determined
not to award multiple pilots to the same jurisdiction.
The AA also explained that the proposal ranked 45th
(a tribal candidate) was selected because the Agency
made a conscious decision to include a diversified
candidate for selection. The AA added that tribes
have not had the experience that the cities have had
in preparing quality proposals; therefore, the Agency
has been meeting and working with them in order to
help improve the quality of their applications. Agency
officials did not document in the grant or selection
files any of their justifications for why these particular
grant applications were either awarded or not
awarded.
A less compelling case can be made for the other two
deviations which we have cited. In the case of the
second ranked proposal, the AA indicated that the
proposal was not selected because the regional
brownfields representative on the Headquarters
selection panel did not believe the proposal was a
good candidate for selection, despite its high ranking.
The AA stated he was not sure why the fifth ranked
proposal was not considered for award by the
regional panel. He speculated that the regional panel
may have detected too many flaws with the
application during their review. Our subsequent
review of Agency documents pertaining to this
application showed that there were several
weaknesses identified by the regional panel. This
may have contributed to it not being forwarded to
Headquarters for consideration of award.
The selection process would be strengthened by
more clearly describing the purposes and results of
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the various reviews. We recognize that there may be
valid reasons for EPA to occasionally pass over a
proposal with a higher rank and select a proposal of
lower ranking. However, when this does occur, we
believe OSPS should document the rationale for the
decision. During ourfieldwork, we discussed the
selection process at length with the Director and her
staff. They were willing to refine or modify the
process as necessary. If the role of the regional
panelists is to separate out the weakest of the
proposals, as opposed to ranking each proposal in
order of its merit, categorizing the proposals in
groups such as high, medium, or low, or even
pass/fail would be more representative of what they
are trying to accomplish. Additionally, any selection
deviating from the categorization; e.g., selecting a
medium over a high or including a "fail" would need to
be justified in writing. The function of the
Headquarters review should be clearly delineated.
The AA could still retain final grant approval, if
desired, with deviations from the recommended
selections also requiring written explanation
Recommendations	We recommend that the Assistant Administrator for
Solid Waste and Emergency Response:
2-1. Revise the "Proposal Guidelines for
Brownfields Assessment Demonstration Pilots"
to instruct applicants to include project
milestones for completing tasks under pilot
demonstration projects.
2-2. Remind applicants and reviewers, prior to the
submission of proposals, of the need to
recognize in writing that quality sampling and
analysis procedures must be followed when
site assessment work is proposed, and
accordingly apply this criterion during the
evaluation process.
2-3. Clarify the responsibilities of all persons
involved in the selection process and
enumerate those responsibilities in written
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guidance made available to the public and the
selectors.
2-4. Formalize selection procedures in the written
guidance for all steps of the review process.
Establish formal procedures for Headquarters
review of regionally ranked proposals which
ensures that each regionally acceptable
proposal is reviewed by a set number of
Headquarters experts (individually or
collectively) and ranked.
2-5. Provide written justification for deviations from
the ranking.
Agency Response and
OIG Evaluation	The Agency agreed to revise its proposal guidelines,
establish standard operating procedures for the pilot
selection process, and replace the numerical scores
with a high/medium/low rating of the proposals.
These actions will be complete by October 2000,
January 2001, and October 2000, respectively. The
proposed corrective actions will address the
recommendations and no further action is required.
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CHAPTER 3
Brownfields Quality Assurance
To implement the recommendations from our March
1998 report relating to quality assurance (QA), EPA
issued Brownfields QA guidance to the regions,
informed pilot recipients of QA requirements, and
reminded project officers and assistance recipients of
the need for EPA-approved Quality Assurance
Project Plans (QAPPs) prior to conducting field work.
While the regions we reviewed appear to have given
consideration to the guidance, the extent to which
they implemented it varied. Region 4 had not
instituted adequate QA policies and procedures and
Region 5 was inconsistent in implementing the
policies. Consequently, we are uncertain that the
data collected during some site assessments is of
acceptable quality upon which to base clean-up
decisions. We believe significant improvements to
Region 4 practices are necessary to provide
assurance that environmental data is of acceptable
quality.
Prior Recommendations Have
Been Implemented by OSWER In our March 1998 audit, we reported that pilot cities
were being awarded grants to conduct site
assessment work, but were not required to adhere to
a quality assurance program. Additionally, OSWER
had not set up a quality assurance framework for the
conduct of site assessments as required under EPA
Order 5360.1 CHG1. Therefore we recommended
that OSWER:
Remind project officers and assistance
recipients of the need for EPA-approved
QAPPs prior to conducting field work.
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Issue the Brownfields QA guidance to the
regional offices and provide copies of the
guidance to pilot recipients.
OSWER has taken both of these actions. In
September 1998, they distributed their guidance
document entitled "Quality Assurance Guidance for
Conducting Brownfields Site Assessments." Then, in
February 1999, the Director, OSPS, issued a
memorandum to all regional brownfields coordinators
informing them of the requirement, under 40 CFR
§35, Subpart 0, that pilot cities submit QAPPs for
brownfields site assessments to EPA for review and
approval prior to beginning field work.
We reviewed the national brownfields guidance and
concluded that the guidance adheres to EPA policy
and requirements under the mandatory quality
assurance program for environmental data collection
(EPA Order 5360.1 CHG1). Furthermore, the
guidance contains an excellent discussion of quality
assurance concepts, especially the discussion of data
quality objectives. The document also contains
illustrative examples to assist the reader with
comprehension of complex quality assurance
concepts.
Strength of Regional
QA Programs Varied	We believe that OSPS, the office responsible for
coordinating and implementing the Brownfields
Initiative, has now instituted adequate QA policies
and procedures for the conduct of brownfields site
assessments. To determine whether the regions
implemented these procedures, we judgmentally
selected three regions, Regions 1, 4, and 5 to
conduct QA fieldwork. We reviewed regional
guidance as well as QAPPs and Phase II site
assessment reports for two pilot cities in each of the
selected regions. We interviewed each regional
quality assurance contact to gain an understanding of
how the quality assurance program is implemented in
each region. We also discussed the management
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and implementation of quality assurance procedures
for sampling activities with pilot representatives.
We found that QA guidance was provided to the three
regions we visited. Although not all pilot cities we
visited had a copy of the guidance document, city
officials were generally aware of the guidance and
the need for proper QA procedures during site
assessments.
One of the three regions (Region 4) in our sample
had prepared and issued its own QA guidance in
December 1998 which communicates to its pilot cities
the minimum information to be included in a
brownfields site assessment QAPP. It also
references the national guidance for more detailed
information and a discussion of QA concepts. We
found this document to be redundant when compared
to the national guidance, but with far less discussion
of QA concepts.
Because the three regions in our sample varied
significantly in implementing their regional QA
programs, we will discuss each region separately.
Region 1 Implementation
Region 1 has instituted adequate basic QA policies
and procedures for the conduct of brownfields site
assessments. QAPPs were prepared and approved
by EPA prior to sampling for both of the pilot cities we
reviewed. Discussions with the Project Managers
(PMs) and the QA Manager (QAM) revealed that the
Region meets with its pilot cities prior to development
of the QAPP to explain the Region's requirements for
conducting brownfields site assessments, including
requirements and expectations for QAPPs. In
addition, the EPA QAM recommends that the city and
contractor personnel conduct a preliminary site visit
to better visualize the site conditions prior to
assembling the QAPP. Regional involvement with
cities and their contractors early in the process helps
to ensure that the project objectives are well thought
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out and agreed upon by all involved parties. In
addition, the region's early involvement speeds the
review and approval process, thereby leading to
earlier implementation.
Region 1 does not review the site assessment reports
for adherence to the approved site-specific QAPPs.
(This was also true for Regions 4 and 5). However,
our review of the site assessment reports for the two
Region 1 pilot cities we selected revealed that the
site sampling and analysis correlated with the
approved, planned work. That is, the number, type
and location of environmental and quality control
samples collected were commensurate with that
specified in the QAPP.
Region 4 Implementation
We found that Region 4 had not instituted adequate
QA policies and procedures for the conduct of
brownfields site assessments. The Regional QAM
told us that PMs and pilot cities have been instructed
on the requirement that QAPPs be in place prior to
beginning field work. For the two pilot cities selected,
however, we found that four of seven QAPPs were
prepared and submitted to EPA for review after
sampling was conducted; and five of seven QAPPs
did not contain any indication that EPA had reviewed
and approved the QAPP. The Regional QAM
explained that the PMs tend to invite QA staff to
review and comment on QAPPs only when they are
uncomfortable or inexperienced with scientific or
technical issues. Otherwise, some PMs elect to
review QAPPs themselves. In addition to these
concerns, one QAPP did not include sample
collection locations; one QAPP did not include
specific information, such as number and type of
samples to be collected; and one QAPP referenced
outdated guidance. These problems indicate that
regional managers and staff do not fully understand
the importance of, nor are committed to, sound QA
practices.
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Region 5 Implementation
Region 5, like Region 1, has instituted adequate
basic QA policies and procedures for the conduct of
brownfields site assessments, but is somewhat
inconsistent in the implementation of those polices.
QAPPs had been prepared prior to sampling for both
of the pilot cities we reviewed; however, we could not
verify that the QAPP and/or sampling and analysis
plans were reviewed and approved by EPA for one of
the two cities in our sample. Discussions with the
PMs and the QAM revealed that Region 5, like
Region 1, meets with its pilot cities prior to
development of the QAPP. The purpose of this
meeting is to go over the Region's requirements for
conducting brownfields site assessments, including
requirements and expectations for QAPPs, as well as
site-specific and development issues. In addition, the
EPA PMs and the QAM recommend options for
sample analyses, including use of the EPA Contract
Laboratory Program and the Region 5 Laboratory.
Regional personnel also provide their cities with a
copy of the national brownfields QA guidance.
The QAM, however, does not provide written
comments to the city or its contractor after reviewing
the QAPP. Typically, the QAM will discuss concerns
directly with the contractor via the telephone. When
asked why comments were not documented, the QAM
replied that it is too time consuming and introduces a
formality into the relationship among the three
parties. As with Region 1, Region 5 does not review
the site assessment reports for adherence to the
approved site-specific QAPP. Our review of the site
assessment reports for the two cities selected
revealed that sampling and analysis conducted
during the assessments correlated with the planned
work outlined in the QAPP.
QAPPs Are Key to Valid
and Useful Assessments QAPPs are considered to be the blueprint of
assessment work to be conducted. They contain
essential information on key decisions to be made, as
well as the number and type of samples to be
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collected to arrive at these decisions. They also
contain information on what happens if the right data
is not collected. Evidence of an EPA-approved
QAPP documents a well thought out process to
achieve the assessment's intended objective. In
addition, the QAPP serves as an assessment tool
which EPA can use to evaluate the progress of the
grantee and the effectiveness of chosen actions.
The primary goal of the Brownfields Initiative is to put
idle or underutilized properties into productive reuse.
It would be a great threat to the success of the
program to discover properties returned to use where
employees or residents were becoming seriously ill
due to toxic pollutants not having been adequately
identified or cleaned up. One of the most effective
ways to minimize this threat is to insist on effective
quality assurance measures during site assessment
and cleanup.
While OSWER has done a commendable job since
our last audit in providing QA guidance for conducting
brownfields site assessments, regions have not been
consistent in implementing the guidance. Although
guidance is not mandatory, given the widely
recognized value of a sound QA program, the varying
degree of adherence to the national guidance was
cause for concern. We are unable to state with any
degree of assurance that the environmental data
collection for all brownfields site assessments is of
acceptable quality upon which to base clean-up
decisions. Our review of five of the earliest site
assessment grants for our 1998 report showed that
very little of the grant activities focused on actual site
assessments. The absence of an adequate QA
program, while troubling, certainly was not
devastating given the relatively small number of
grants and the even smaller number of site
assessments. As a result of our recommendation, the
Agency has now focused its site assessment grants
on site assessments. Ninety-eight percent of grants
awarded in 1998 and 1999 involve some site
assessment work. Furthermore, the number of site
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assessment grants awarded increased from 23 in
1998 to 57 in 1999. As the program matures, the
need for clean-up decisions to be based on sound
science grows exponentially.
OSWER should evaluate the implementation of its
QA process in the regions. If problems are identified,
then it should take corrective action to ensure that
quality assurance is built into all brownfields site
assessments and cleanups.
Site Visits and Increased
Communication Can Enhance
the Quality of Assessments During the course of our review, we found that project
officers and/or QA staff of some EPA regions
periodically visit brownfields sites during site
assessment sampling and analysis activities. Such
visits serve to ensure that QAPP procedures are
appropriately followed and can help to ensure high
quality assessments. We learned that the project
officers and/or QA staff in Regions 1, 5, and 9
conduct periodic site visits. Project officers who
conduct such visits explained that the visits were a
very useful way to prevent or minimize potential
problems with sampling activities and ensure the
quality and consistency of sampling data for site
decision-making.
Communicating with grant recipients at the very
outset of projects is also a desirable practice to
ensure everyone is familiar with the purpose and
requirements of the grants. Project officers in
Regions 1 and 5 meet with grantees shortly after the
award of grants to explain grant requirements and
address grantees' questions or concerns. Region 1
invites all recent grant recipients in at one time for an
informational briefing and conference. Regional staff
discuss relevant issues and restrictions regarding the
grants. The regional staff address any questions the
grantees may have and clarify areas of uncertainty.
The QA staff in Region 1 sometimes participate in
these meetings to explain QA for site assessments.
Region 5 conducts a pre-QAPP meeting with the city
and its contractors for each project. During this
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meeting, the region and the grant recipient will
discuss the purpose of the assessment and the
scope.
Other EPA regions should consider conducting such
meetings with grant recipients at the very beginning
of brownfields projects to discuss goals and
objectives, clear up questions, and ensure that
grantees are proceeding in the right direction.
Recommendations	We recommend that the Assistant Administrator for
Solid Waste and Emergency Response:
3-1. Conduct an initial evaluation of how effectively
Regions 2, 3, 6, 7, 8, 9, and 10 are
implementing QA guidelines for brownfields
site assessments and follow up with periodic
national oversight.
3-2. Work with Region 4 brownfields managers to
implement adequate QA procedures and to
ensure that site assessment grant recipients
prepare and submit QAPPs to EPA prior to
field sampling.
3-3. Remind Region 5 that review and approval of
QAPPs and/or sampling and analysis plans
prior to field sampling activities is expected
practice.
3-4. Share desirable practices, such as pre-QAPP
meetings, with all regions and encourage
regional brownfields coordinators to
communicate up front with grantees to address
questions and concerns about QAPPs. The
regions should invite QA staff to participate in
these initial conferences.
3-5. Encourage the project officers and/or QA staff
to communicate frequently with pilot cities and
conduct periodic site visits to ensure the
quality of site sampling and overall site
assessments.
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Agency Response and
OIG Evaluation	OSWER agreed to evaluate QA implementation in
the remaining regions over the next three or four
fiscal years. The Agency will be addressing the
remaining recommendations on an on-going basis
during regularly scheduled contact with the regions.
The proposed corrective actions will address the
recommendations and no further action is required.
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CHAPTER 4
The Brownfields Cleanup Revolving Loan Fund
The Brownfields Cleanup Revolving Loan Fund
(BCRLF) pilots have been slow to make cleanup
loans. Since 1997, EPA has awarded $43.1 million to
68 pilots; an additional 30 pilots have been selected
to receive funding in fiscal year 2000. As of June 30,
2000, approximately $1 million had been loaned, and
only one cleanup had been completed. The primary
reasons for delay are the barriers imposed by
Superfund legislation (CERCLA and the associated
NCP requirements), the grantees' lack of
understanding about how to overcome some of the
barriers, and the availability of commercial loans at
about the same interest rate without the BCRLF
restrictions and administrative requirements. OSPS
has been working hard to overcome these
impediments. EPA supports the bipartisan
brownfields legislation introduced in the Senate in
June2. OSPS has issued guidance, offered training,
and is trying to increase the flexibility of the program
to attract loan applicants. These efforts may produce
results. In fact, four of the five loans made came from
the1999 awards. However, the first pilots have not
yet completed their project period, the second group
has not completed their first year, and the most
recent selectees have not received their awards.
Given the limited history of the program, along with
the number of changes being proposed and made,
now is not the most appropriate time to determine the
success of the BCRLF. We recommend that EPA
obtain a comprehensive evaluation of the costs and
2The Brownfields Revitalization and Environmental Restoration Act of 2000, S. 2700, was
introduced on June 8, 2000, by four members of the Environment and Public Works Committee,
including the Chair of the Subcommittee on Superfund, Waste Control and Risk Assessment.
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benefits of this program after gaining more
experience, perhaps at the end of fiscal year 2003.
Status of the BCRLF Awards The BCRLF was created to enable states, political
subdivisions, and Indian tribes to make loans to
facilitate the cleanup and redevelopment of
brownfields properties. Grantees (pilots) were
authorized to spend up to 15% of the award on
administrative expenses. Only entities that had been
Site Assessment pilots or had Targeted Brownfields
Assessments performed in their jurisdiction were
eligible to apply for the BCRLF which was intended to
be the next phase in the logical progression of the
Brownfields Initiative. In 1997, EPA awarded 23
cooperative agreements for $350,000 each to
capitalize the initial BCRLF pilots.
When we conducted our original review, no loans had
been made and Congress had questioned the
Agency's authority to use Superfund dollars to fund
such a program. The 1998 appropriation legislation
prohibited the use of Superfund money for the
BCRLF. There was no restriction in the following
year's appropriation; so in 1999, EPA awarded 45
new cooperative agreements for up to $500,000 per
eligible entity. Additionally the Agency provided
supplemental funding of $150,000 to seven of the
1997 pilots that had demonstrated substantial
progress toward making loans. The supplement
amount provided parity for the selected 1997 pilots
with the newly awarded 1999 pilots.
Four pilots have issued the only five loans made as of
June 30, 2000. The two loans, made by the city of
Stamford, CT, had consumed the bulk of the "seed
money" provided by EPA, and the city contributed
additional resources to its fund. The first BCRLF loan
was for $250,000 to a private developer to clean up a
former shipyard site with multiple contaminants to
build waterfront condominiums. The second loan by
Stamford was for $160,000 to business owners who
wanted to clean up an industrial site with multiple
contaminants in order to expand and relocate their
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motorcycle dealership. The first loan, however, was
recently "rescinded" as the developer transferred the
property to another owner and will not be building the
condominiums. The cleanup on the second loan is in
progress.
The first and only completed cleanup was funded by
a $50,000 loan from the city of Las Vegas, NV, to a
public entity to create a small-business incubation
and community center on the site of a former National
Guard Armory with contaminated soil. EPA awarded
a cooperative agreement to Las Vegas in September
1999, and in November this loan was approved.
Before the end of December 1999, the cleanup was
complete.
Trenton, NJ, a 1997 pilot, and Shreveport, LA, a 1999
pilot, have recently signed "loans to themselves" in
which the cities are each responsible for the cleanup
and redevelopment of their properties. The loans
were for $275,000 and $400,000, respectively.
[Trenton, on July 6, 2000, approved its second loan
for $150,000.]
Impediments to Loan Issuance CERCLA and NCP requirements have provided the
most significant impediments to the success of the
BCRLF. CERCLA restrictions prohibit the use of
Superfund dollars to clean up sites contaminated
solely with petroleum products. BCRLF pilot funds
also may not be used to clean up products that are
part of the building structure and result in exposure
within residential buildings or business or community
structures. For example interior lead-based paint
contamination or asbestos that results in indoor
exposure only may not be cleaned up with BCRLF
pilot funds. Additionally, BCRLF pilot funds are
generally not permitted to be expended on building
demolition, unless demolition is necessary for the
cleanup. Further, the CERCLA requirement that
borrowers pay Davis Bacon Act wages may
discourage businesses from borrowing from the
BCRLFs. Other "cross cutting" social policy
requirements that apply by their own terms may
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similarly discourage borrowers. Once cleanup has
begun, it must be completed in 12 months, and it
must be supervised by an On-Scene Coordinator
(OSC). The OSC is a government employee who
manages the site and must have experience with
coordinating environmental responses and
knowledge of the associated requirements. These
restrictions severely limit some cities' abilities to
make loans from their BCRLFs.
At the time of our previous report, these barriers had
been identified and suggestions made for overcoming
them. We recommended that the then-Acting
Assistant Administrator: (1) explore alternatives to
help recipients overcome CERCLA- and NCP-related
barriers and (2) provide them with training on
applicable CERCLA requirements.
EPA's activities to implement our recommendations
were as follows: Agency officials met with
Congressional staff to discuss options to enhance the
program and commented on various proposed
legislative changes. OSPS has provided
clarifications to existing requirements, highlighting
areas of flexibility of which pilots may not have been
aware. For instance, Agency officials suggested that
BCRLF pilots enter into agreements with the Army
Corps of Engineers or their state government to
provide OSC services if they do not have that
capability in-house.
As recently as May of this year, EPA took the position
that existing regulations were adequate and
workable. Rather than pursue the lengthy process of
regulatory change, Agency officials chose to focus
their efforts on identifying areas where policy
guidance could be developed or clarified in
interpreting how to apply the NCP requirements to
brownfields. However, it appears that this position is
changing. On June 29, 2000, the AA testified before
a Senate Subcommittee that EPA supported the
bipartisan brownfields legislation proposed by the
Subcommittee. If Congress passes the bill, that may
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Increasing Flexibility May
Increase Loans From
the BCRLF
provide legislative relief from CERCLA and NCP-
related barriers.
Since our last report, OSPS has issued guidance and
conducted training. In May 1998, OSPS issued the
Administrative Manual to provide guidance to regions
and pilots as to how the program should be run.
OSPS also conducted a training session for the
regions in February 1999. Many pilot and regional
representatives attended the one-day BCRLF
seminar offered prior to the Brownfields '99
conference and found it useful. The regions we
visited have provided formal training to pilots at least
once since our prior report was issued. One of the
regions even offered applicants a series of sessions
to better understand the program before they became
participants. In June 2000, OSPS held another one-
day workshop on the BCRLF program to help the
regions help their pilots.
We were told by municipal officials at the time of our
first audit that the constraints imposed by Superfund
legislation, the small dollar amount of the loan, and
the increased administrative requirements and the
inflexibility associated with the BCRLFs would not
make these loans highly sought after. Furthermore,
with interest rates low and the economy doing well,
commercial loans at about the same interest rate
were available and without all the requirements of the
BCRLFs.
Most of the municipal officials we met with during our
follow-up also believed that changes were needed to
make the program more successful. They told us that
the program, as it exists, is too narrow and inflexible
to meet the needs of many local governments. They
believed that even beyond the legislative/regulatory
changes, EPA could and should open the program to
more localities and more borrowers. They stated that
less restrictive funds are available in commercial
loans and other government grant programs. Some
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of the changes they suggested were: open BCRLF
eligibility to any jurisdiction having completed
qualified assessments (not just EPA-paid
assessments); expand the pool of eligible borrowers
to include Potentially Responsible Parties; offer
clean-up grants; and increase the amount awarded to
pilots to allow them to address more complex
cleanups.
In June, we discussed the BCRLF with the OSPS and
its Director, all of whom were convinced that the
program would be successful despite its slow start.
They pointed out that the loans that have been made
have come from the newer awards. They believe this
has occurred because the municipalities now have an
understanding of the CERCLA and NCP constraints,
as well as the knowledge of how to overcome some of
them. They were excited by the fact that a new loan
was to be announced the next day. Further,
municipalities were discussing joining together for
BCRLF purposes. At least one 1997 recipient, thus
far having not made a loan, was discussing this
approach with neighboring counties, and OSPS staff
were optimistic that it would occur.
The Future of the BCRLFs The proposed legislation, if it passes Congress, and
its attendant regulations, may be years in the making.
In the interim, the Agency should continue to clarify
existing requirements, train grantees, and infuse the
current program with as much flexibility as possible.
Additionally it must make some difficult decisions
about its initial BCRLF awards. As the 1997 awards
are approaching the end of the three-year project
period, EPA is faced with the prospect of reclaiming
the more than $7 million not loaned by those pilots.
The Director, OSPS, acknowledged that the grants'
closeout criteria allows them to begin this process as
early as 18 months into the project period when less
than 50% of the funds have been loaned. They also
indicated that they will not include that language in
future grants.
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We discussed the possibility of returning unused
funds to EPA. Neither the Agency nor pilot
representatives were anxious for the funds to be de-
obligated, yet this was acknowledged to be a
probable outcome for at least a few pilots. In a June
2000 meeting with the audit team, the Assistant
Administrator affirmed his willingness to reclaim as
many of the awards as necessary.
Finally, the Agency needs to commit to an
independent evaluation of the success of the
program. While now is not the most appropriate time
to do this, after two sets of pilots have completed
their project periods, there should be enough
information upon which to base an assessment of
program accomplishments. When the BCRLF was
developed and funded in 1997, neither EPA, nor the
initial pilots, had a clear understanding of the
problems to be faced and the means to overcome
them. Thus, judging the program by the number of
loans to this point, or the number of cleanups to date,
is premature. However, at the five year point EPA
should obtain an independent, comprehensive
evaluation of this program.
Recommendations	We recommend that the Assistant Administrator for
Solid Waste and Emergency Response:
4-1. Continue efforts to promote and support
legislative changes for the Brownfields
Initiative.
4-2. Continue to expand available guidance to
foster success under current legislation.
4-3. Continue to provide training to current and
prospective BCRLF recipients.
4-4. Seek to add flexibility to future BCRLFs by
considering:
a. Increasing grant award amounts; and
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b. Expanding the eligible pool of applicants
beyond those having participated in EPA
assessment programs.
4-5. De-obligate funds awarded to pilots that do not
demonstrate substantial progress toward
making a loan by the end of their project
period.
4-6. Obtain an independent analysis of the success
of the BCRLF at the five year anniversary of
the program.
Agency Response and
OIG Evaluation	The Agency agreed to continue implementing our
original recommendations on an ongoing basis.
OSWER described its plans to increase flexibility in
the BCRLF by increasing funding, expanding
eligibility, and making cleanup grant money available
in FY2001, by modifying the proposal guidelines
which will be issued by October 2000. The Agency
agreed to take action regarding the 1997 pilots,
completing the process by January 2001. An
independent evaluation of the BCRLF will be
obtained at the program's five-year anniversary. The
proposed corrective actions will address the
recommendations and no further action is required.
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CHAPTER 5
Brownfields Initiative Reporting
Reporting Brownfields
Accomplishments Needs
to be Timely
Quarterly reporting by brownfields site assessment
grant recipients has improved since our previous
audit. The reports now specify the activities
performed with EPA funding and contain data which
are useful to the regions and headquarters
brownfields officials. Not all quarterly reports were
submitted timely, however. In addition, some
clarification may be needed for information required
of grant recipients in the quarterly reports. We found
that the Agency has initiated steps to improve the
accuracy of achievements reported through the
Brownfields Management System (BMS).
Quarterly reports are required from the recipients of
EPA brownfields site assessment grants. These
reports are used by headquarters and regional
brownfields officials to manage the site assessment
program. The quarterly reports also assist EPA
project officers in staying abreast of property
assessment, cleanup and redevelopment activities on
individual projects. Our March 1998 report
recommended that EPA instruct grantees to clearly
delineate in quarterly reports those activities which
were undertaken with EPA funds during the reporting
period. The reports that we reviewed for our current
audit indicated how EPA funds were being spent.
However, not all reports that we reviewed were
submitted within 30 days after the end of each
quarter, as the grant conditions require. A few
reports were submitted more than two months late.
One report was submitted more than four months
late.
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Receipt of timely quarterly reports assists the Agency
in staying up to date and informed of the progress of
various brownfields projects. Data contained within
the quarterly reports are input into BMS. BMS assists
the Agency in fulfilling Agency reporting requirements
for the Brownfields Initiative under the Government
Performance and Results Act (GPRA). The ability to
accurately track and report on the activities and
progress of the pilot projects is vital for achieving the
goals of the Brownfields Initiative. Consequently, it is
critical that quarterly reports are timely and accurate.
As an example of a useful practice, Region 1 sends
out a reminder letter to recipients about two weeks
before the quarterly reports are due. If reports are
overdue for 10 days or more, the Region sends out a
second reminder notice. This seemed to be an
effective method for ensuring the timely receipt of
quarterly reports.
EPA is Working to Improve
the Reliability of BMS Data During the course of our review, congressional
committee staff expressed concerns regarding the
reliability of BMS data because of fluctuations in
certain accomplishment data reported in various
quarterly reporting periods, especially regarding the
number of site assessments completed. The
committee staff believed that some accomplishment
data may have been overstated.
We performed a limited analysis of selected
accomplishments included in the National
Brownfields Management Summary reports for the
18-month period July 1998 through December 1999.
We examined the data for the quarterly reporting
periods ending September 30, 1998, and September
30 and December 31, 1999. The categories we
evaluated included:
assessment demonstration pilots awarded,
properties with site assessments started with
pilot funding,
properties with site assessments completed
with pilot funding, and
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properties with redevelopment activities
underway.
We found that the totals contained in the national
summary reports for the above categories had not
generally fluctuated, but steadily increased over time,
which would be expected in a growing program. The
increases can be seen in Table 1 below.
Table 1
Selected Brownfields Accomplishments Reported in BMS
July 1, 1998 - December 31, 1999
Category
Qtr. ending
9/30/98
Qtr. ending
9/30/99
Qtr. ending
12/31/99
Pilots awarded
225
304
305
Properties with
assessments started with
pilot funding
893
1,844
1,883
Properties with
assessments completed
with pilot funding
704
1,665
1,674
Properties w/ redevelop,
activities underway
85
173
184
Source: Brownfields Management Summaries [National]
According to OSPS representatives, EPA typically
only receives about 75 percent of the quarterly
reports at the time that the National Brownfields
Summary report is issued, since many quarterly
reports are not submitted timely to EPA.
Consequently, the numbers included in the BMS
summary reports are more likely to be conservative
and understated rather than overstated. In our
review of this data, we did observe fluctuations in the
individual data points for the time periods selected as
OSPS issued revisions to the reports in keeping with
efforts to improve the accuracy of BMS reports.
Clarification of Terms Desired Some city officials indicated that they had difficulty in
providing EPA with the information the Agency needs
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for BMS input. Some officials said that they often had
to reconfigure the numbers in their own data bases to
meet EPA information needs. City officials added
that some questions were unclear and difficult to
answer. For example, some officials said that it was
difficult to:
(1)	Provide a hard and fast figure on the number
of Brownfields sites in a particular city (e.g.,
should a site with multiple adjacent tracts be
counted as one site or several?); and
(2)	Calculate the remediation and/or
redevelopment jobs and dollars leveraged
which can be attributed to EPA's grant.
Agency staff acknowledged that there has been some
confusion regarding definitions of properties and
parcels among some cities. EPA has had many
discussions with pilot city representatives on this
issue. Much discretion is left to the cities to decide
how properties are defined. In some cases, the
numbers of properties to be reported relate to the
intended uses of the property once sites have been
declared clean. If several different businesses will be
occupying the property, several properties may
ultimately be counted instead of just the one that was
declared for the pilot initially. In other cases, a large
property may still be counted as one property, even
though it is later broken into separate parcels and
multiple assessments and cleanups are conducted.
EPA recently initiated efforts to help clarify some
brownfields terminology. In September 1999, OSPS
issued a memorandum to the Regional Superfund
Policy Managers transmitting Model New Terms and
Conditions related to the minimum reporting
requirements for Brownfields cooperative
agreements. To supplement this clarification of
reporting standards, the Agency issued a "Data
Primer" for users of brownfields information in
February 2000. This document provides definitions
of key measures, terms and conditions, and reporting
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guidelines and the procedures for quality control for
brownfields data. The Minimum Reporting
Requirements and Data Primer should provide the
Agency, its contractors, and pilots a common
understanding of brownfields information needs.
These documents will be updated periodically, as
needed.
We were informed by OSPS representatives that they
have taken steps to improve the accuracy and
reliability of BMS data being reported by revising the
data input process. In the past, data were extracted
from the quarterly reports and entered directly into
BMS. The regions were provided summary reports
after the data had been input into BMS. Now data
are extracted and entered into a preliminary data
base and the regions are given one month to verify
the data or resolve problem data before information is
entered into BMS.
We believe the Agency should continue its current
efforts to improve the quality of data collected and
reported in BMS. Accurate information about the
number of assessments started and completed is a
key performance measure for evaluating the success
of the Brownfields Initiative.
Recommendations	We recommend that the Assistant Administrator for
Solid Waste and Emergency Response:
5-1. Instruct regional brownfields coordinators
and/or project officers to identify and notify
delinquent quarterly reporters of the need for
timely submissions. The coordinators and/or
project officers should consider sending
reminder notices to grant recipients shortly
before the quarterly reports are due.
5-2. Continue to work with regional brownfields
coordinators, project officers, and grant
recipients to clarify information requirements
and establish a common understanding of
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terms and definitions included in quarterly reports.
Agency Response and
OIG Evaluation	OSWER agreed to include these issues in
discussions with the regions and continue such
efforts. A model late notice will be developed by
March 2001. The proposed corrective actions are
responsive to the recommendations. No further
actions are required.
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APPENDIX I
AGENCY RESPONSE
August 29, 2000
MEMORANDUM
SUBJECT: Comments on Draft Office of Inspector General Follow Up Audit of Brownfields
Initiative
FROM: Timothy Fields, Jr. /s/ Michael Shapiro for
Assistant Administrator
TO:	Nikki L. Tinsley
Inspector General
Attached are our comments on the above-referenced draft Office of Inspector General (OIG)
report. Input from the Office of General Counsel (OGC) as well as our Regional Brownfields
coordinators has been incorporated into this response. We appreciate the OIG's coordination on
the development of this report and also appreciate that many of our previously suggested changes
were in fact made and are reflected in this current draft report. Our comments also reflect input
received from several EPA regions.
We continue to believe, however, that the OIG has not recognized the differences between
the competitive processes utilized for direct procurement of Federal contracts and those used for
awarding assistance agreements. Competition for assistance agreements is not legally required,
and certain preferences and judgments of a nonpolitical nature are not only permitted, but are
likely to continue to play a part in the selection process for a small percentage of applicants. Not
every single factor that is utilized in the selection process can be reduced to objective criteria, and
this may be a basic point of disagreement. Our recommendation is that OIG personnel may wish
to further discuss this issue with Jim Drummond of OGC, and we would of course be glad to
answer any further OIG questions with respect to our comments. We appreciate the opportunity
to respond to this report.
If you have any questions, please contact Linda Garczynski, Director of the Outreach and
Special Projects Staff, at 202-260-4039.
Attachment
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OSPS Comments on Draft OIG Brownfields Audit Report
Chapter 1 - Introduction (BackerouncD
General Comments
Add to first sentence (under "Background), "consistent with the National Oil and
Hazardous Substances Pollution Contingency Plan (NCP), to address releases . . "
Next (second) sentence, delete the words in "connection with response actions taken
under CERCLA Sec 104(a)."
The third sentence should be replaced with "CERCLA Sec 104 response actions may be
taken at sites at which there is a release or substantial threat of release into the
environment of a hazardous substance regardless of whether those sites are listed on the
National Priorities List (NPL) "
The fourth sentence should be replaced with "EPA's Office of General counsel has
determined that EPA may address brownfields using CERCLA Sec 104 authorities and
may, pursuant to CERCLA 104(d), provide funds to states, political subdivisions and
Indian Tribes to address brownfields."
In the third paragraph, the last sentence should be replaced with "Both types of pilots are
funded through grants between EPA and any of the following: states, political subdivisions
(including cities, counties, and regional governmental entities), and Indian Tribes."
Chapter 2
General Comments
•	In the second to last sentence of the second paragraph under the section "Quality of Grant
Proposals Has Improved," the word "in-house" should be placed before "technical
expertise," to be consistent with the paragraph above.
•	Under this same section, it is stated that "If the proposal does not adequately address
quality sampling and analysis when it should, it could be rejected outright or, after
preliminary review, it could be returned for further work." We disagree that the proposal
should be returned to the recipient for further work, since this could impact the integrity
of the competitive process if some applicants were allowed to change their application
after the due date.
•	We take issue with the statements on page 8 of the report which state that the selection
process needs to be more objective in order to "protect the integrity" of the assessment
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pilot award process. In particular, the statement that "the current process leaves the
Agency vulnerable to claims of partiality" should be revised or removed, since competition
for grants is not legally required and statements such as these may inadvertently encourage
unwanted litigation.
Response to Recommendations
2-1 Revise the "Proposal Guidelines for Brownfields Assessment Demonstration Pilots" to
instruct applicants to include project milestones for completing tasks under pilot
demonstration projects.
The "Proposal Guidelines for Brownfields Assessment Demonstration Pilots" dated October 1999
requires that applicants "describe project milestones and project schedule" in the Evaluation
Criteria Part II - Optional (greenspace) section. However, this is not clearly stated in the
Evaluation Criteria Part I. OSWER will ensure that a request for projected milestones and dates
be incorporated in the FY01 guidelines, which are currently be developed.
Issue revised assessment pilot guidelines	September/October 2000
2-2 Remind applicants and reviewers of the requirement for proposals to acknowledge the
need for quality sampling and analysis procedures if site assessment work is proposed and,
accordingly, downgrade those proposals not properly addressing this factor.
The report should acknowledge that submission of a QA plan is not required by the assistance
agreement regulations at Subpart O, and that any decision to downgrade proposals not adequately
addressing quality sampling and analysis procedures would be a program policy call. This area
will continue to be addressed at the work plan negotiation stage, and we do not believe that
downgrading proposals for this reason is appropriate.
2-3 Clarify the responsibilities of all persons involved in the selection process and enumerate
those responsibilities in written guidance made available to the public and the selectors.
OSWER will develop standard operating procedures (SOPs) for the assessment pilot selection
process prior to convening the review panels for FY01.
Develop standard operating procedures for the assessment pilot selection process January 2001
2-4 Determine the cause for the large deviation in individual proposal ratings, and take steps
to make ratings more consistent.
2-5 Formalize selection procedures in the written guidance for all steps of the review process.
Establish formal procedures for Headquarters review of regionally ranked proposals which
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ensures that each regionally acceptable proposal is reviewed by a set number of
Headquarters experts (individually or collectively) and ranked numerically.
In response to the above two recommendations, OSWER will develop standard operating
procedures (SOPs) for the assessment pilot selection process prior to convening the review panels
for FY01. We will revise the "Proposal Guidelines for Brownfields Assessment Demonstration
Pilots" to eliminate numerical scores. A high/medium/low rating will be used instead for ranking
purposes.
Develop standard operating procedures for the assessment pilot selection process January 2001
2-6 Provide written justification for deviations from the numerical ranking.
The "Proposal Guidelines for Brownfields Assessment Demonstration Pilots" for FY01 will be
revised to eliminate numerical scores. A high/medium/low rating will be used instead for ranking
purposes.
Issue revised assessment pilot guidelines September/October 2000
Chapter 3
General Comments
The second sentence in the first paragraph should read, "While the regions we reviewed
appear to have given consideration to the guidance, the extent to which they implemented
the recommendations in the guidance varied."
•	The discussion in the section entitled "QAPPs are key to valid and useful assessments''
incorrectly assumes that deviating from guidance is improper. Variations in implementing
guidance do not necessarily warrant a conclusion that a QA program was not sound. The
report states that the regions' varying degrees of adherence to the guidance is cause for
concern, but does not identify the specific concern.
Accordingly, the first two sentences of the third paragraph under this heading should be
replaced with, "While OSWER has done a commendable job since our last audit in
providing QA guidance for conducting brownfields site assessments, regions have not
been consistent in implementing the recommendations in the guidance. We believe the
guidance provides a good basis for developing an effective QA program and would like to
know under what circumstances the regions are deciding that the recommendations in the
guidance should not be followed."
•	We believe that the recommendations for improved communication and site visits have
merit, but must be weighed relative to their resource utilization. The Brownfields
Program is now specifically allocated 87 FTE but actually uses 127 FTE, and we estimate
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it would require 268 FTE to support our workload. With this disparity between needed
and allocated resources, management must select process improvements that deliver the
highest benefit to cost ratio. Improved communication seems to be superior to site visits
in improving QA performance by brownfields grant recipients, and site visits are clearly
more resource intensive. This suggests we should place emphasis on improved
communication over site visits.
Response to Recommendations
3-1 Conduct an initial evaluation of how effectively Regions 2, 3, 6, 7, 8, 9, and 10 are
implementing QA guidelines for brownfields site assessments and follow up with periodic
national oversight.
Beginning in Fiscal Year 2001, we will evaluate the Brownfields Program management
performance in two or three regions per year. The effectiveness of regional QA/QC practices
will be included in these program reviews.
3-2 Work with Region 4 brownfields managers to implement adequate QA procedures and to
ensure that site assessment grant recipients prepare and submit QAPPs to EPA prior to
field sampling.
It is not clear who is the "Regional QAM" referenced in the report, but the cited statements are
not consistent with the region's brownfields QA review policies. Only qualified brownfields
project managers may review and approve QAPPS. Not all region 4 brownfields project
managers are qualified to do such reviews. Therefore, unless they are technically qualified, they
must submit them to the EPA Athens SESD staff for review and approval. All brownfields
project managers know this. The regional management and staff are committed to implementing
sound QA practices.
Region 4 has taken a number of steps to ensure compliance with the QA requirements by the pilot
cities, including: sending letters and visiting to review and reinforce the requirements; adding an
Army Corp of Engineers chemist with expertise in Laboratory QA/QC to the
brownfields staff; reviewing all Pilot Phase I & lis for compliance with requirements; conducting a
pilots familiarization visit to an EPA Laboratory to reinforce importance of QA/QC; and
providing a session on QA/QC requirements as part of a regional pilots workshop.
OSPS will continue to work with all regions during our monthly conference calls to ensure they
use sound QA/QC policy.
3-3 Encourage Region 5 to review and approve QAPPs and/or sampling and analysis plans
prior to field sampling activities.
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Region 5 can document that the QAPP for the project in question (Wayne County) was reviewed
and approved prior to pilot field activity. The site-specific sampling plan for the same project was
also reviewed and approved, but the project manager did not document this. The value of
documenting reviews and approvals will be reviewed with regional brownfields coordinators
during our monthly conference calls over the next six months.
3-4 Encourage regional brownfields coordinators to communicate up front with grantees to
address questions and concerns about QAPPs. The regions should encourage the
participation of their QA staff in these initial conferences.
These recommendations will be shared with regional brownfields coordinators during our monthly
conference calls over the next six months.
3-5 Encourage the project officers and/or QA staff to communicate frequently with pilot cities
and conduct periodic site visits to ensure the quality of site sampling and overall site
assessments.
This recommendation will be shared with regional brownfields coordinators during our monthly
conference calls over the next six months. Although sensible, this may be difficult to implement
as a greater number of pilots are awarded. It may not be appropriate to provide the same level of
oversight as is required under a regulatory program..
Chapter 4
General Comments
In the section entitled "Impediments to Loan Issuance," the sixth sentence under the first
paragraph should be replaced with "Further, the CERCLA requirement that borrowers pay
Davis Bacon Act wages may discourage businesses from borrowing from BCRLFs. Other
cross-cutting social policy requirements that apply by their own terms may similarly
discourage borrowers."
In the fourth paragraph of that same section, the word "onerous" (in reference to the
process of regulatory change) may be a bit overstated. We recommend either deleting this
word or replacing it with "lengthy."
Under the section entitled "Increasing Flexibility May Increase Loans from the BCRLF,"
we had previously recommended addition of the following language: "EPA has addressed
expansion of eligibility for BCRLF pilots from States, political subdivisions, and Indian
tribes that have received Brownfields Assessment Demonstration Pilots, or political
subdivisions with jurisdiction over sites that have been the subject of a targeted
brownfields assessment. In the most recent round of seven pilots announced in July of
2000, eligible applicants included those political subdivisions or tribes that were part
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of a collaborative assessment pilot partnership, or otherwise directly benefitted from
a Brownfields Assessment Demonstration Pilot."
The Agency has also demonstrated flexibility through consideration of BCRLF proposals
submitted by coalitions formed among two or more otherwise eligible entities. In this
situation, one of the eligible entities serves as the cooperative agreement recipient for the
coalition, and depending upon the entities in the coalition, may include a State serving as
the cooperative agreement recipient on behalf of and for the benefit of the coalition
members. Also, as noted below under the response to recommendation 4-4, flexibility has
clearly been demonstrated by the recent decision to increase grant award amounts and
expand the eligible pool of BCRLF applicants. We believe that these demonstrations of
flexibility should be evidenced in the report, or at least be accommodated by a footnote.
Response to Recommendations
4-1 Continue efforts to promote and support legislative changes for the Brownfields initiative.
We agree, and will continue such efforts on an ongoing basis.
4-2 Continue to expand available guidance to foster success under current legislation.
We agree, and will do this on a continuing basis.
4-3 Continue to provide training to current and prospective BCRLF recipients.
We agree, and will provide such training on a continuing basis.
4-4 Seek to add flexibility to future BCRLFs by considering: a) increasing grant award
amounts, and b) expanding the eligible pool of applicants beyond those having participated
in EPA assessment programs.
We agree. On August 17, the Assistant Administrator for OSWER approved a proposal by the
Office of Outreach and Special Projects that would extend eligibility to all governmental entities
evidencing successful brownfields programs; provide funding up to $1 million per pilot; provide
funding for both loans and grants to pilots; and extend the combination of loan/grant funding to
existing pilots. These changes will be incorporated into the guidelines for pilot proposals in
September of 2000, for selection of pilots in FY 2001.
4-5 Deobligate funds awarded to pilots that do not demonstrate substantial progress toward
making a loan by the end of their project period.
We agree. Actions are anticipated in the September/October 2000 time frame.
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4-6	Obtain an independent analysis of the success of the BCRLF at the five year anniversary of
the program.
We agree, and this will be addressed as the program approaches the five year mark.
Chapter 5
General Comments
Minor editorial additions/changes are recommended to this chapter as follows:
The third sentence of the first paragraph under the section entitled "Reporting Brownfields
Accomplishments Needs to be Timely" should read as follows: "The quarterly reports also
assist EPA project officers in staying abreast of property assessment cleanup and
redevelopment activities on individual projects."
The last sentence in the first paragraph of the next section (Reliability of BMS Data)
should refer to the committee staff, (i.e. the committee staff believed that some . . . data
may have been overstated.)
Under the section entitled "Clarification of Terms Desired," the second sentence of the
third paragraph should read "In September of 1999, OSPS issued a memorandum to the
Regional Superfund Policy Managers transmitting Model New Terms and Conditions
related to the minimum reporting requirements for Brownfields cooperative agreements."
Response to Recommendations
5-1	Instruct regional brownfields coordinators and/or project officers to identify and notify
delinquent quarterly reporters of the need for timely submissions. The coordinators and/or
project officers should consider sending reminder notices to grant recipients shortly before
the quarterly reports are due.
We will discuss this recommendation with our brownfields coordinators on our next conference
call, and will also discuss it with our OGC attorney to assure that there are no legal issues
involved. Also, we would point out that one region (Region 7) has already adopted this reminder
notice procedure.
5-2 Continue to work with regional brownfields coordinators, project officers, and grant
recipients to clarify information requirements and establish a common understanding of
terms and definitions included in quarterly reports.
Agree, and we will continue to do this on an ongoing basis.
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APPENDIX II
REPORT DISTRIBUTION
Inspector General
Deputy Assistant Inspector General for Audit
Divisional Inspectors General
Assistant Administrator, Office of Solid Waste and Emergency Response
Agency Follow-up Official
Agency Follow-up Coordinator
Associate Administrator for Congressional and Intergovernmental Relations
Associate Administrator for Communications, Education, and Media Relations
Associate Administrator for Regional Operations
Regional Administrators
Director, Outreach and Special Projects Staff, OSWER
Audit Liaison, OSWER
Brownfields Coordinator, Region 1
Brownfields Coordinator, Region 4
Brownfields Coordinator, Region 5
Brownfields Coordinator, Region 9
Audit Liaison, Region 1
Audit Liaison, Region 4
Audit Liaison, Region 5
Audit Liaison, Region 9
Audit Liaison, OIG
Director, Quality Staff, OEI
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