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U.S. Environmental Protection Agency
Office of Inspector General
At a Glance
2005-P-00014
March 31, 2005
Why We Did This Review
Grants management has been a
significant challenge for EPA
for several years. At the
recommendation of the Office
of Inspector General, EPA
issued an Order requiring
some grants to be competed.
To evaluate EPA's progress,
we assessed whether (1) the
Order promoted competition,
and (2) the competitions were
fair and open.
Background
EPA issued Order 5700.5,
Policy for Competition in
Assistance Agreements,
effective October 1, 2002.
The Order established EPA's
policy: "to promote
competition in the award of
assistance agreements to the
maximum extent practicable. "
The Order also established
criteria stating when
competition for grants is
needed and the process for
competing the grants.
For further information,
contact our Office of
Congressional and Public
Liaison at (202) 566-2391.
To view the full report,
click on the following link:
www.epa.qov/oiq/reports/2005/
20050331-2005-P-00014. pdf
Catalyst for Improving the Environment
EPA Needs to Compete More
Assistance Agreements
What We Found
EPA Order 5700.5 (Order) was a positive step in promoting competition;
however, it did not promote competition to the maximum extent possible. The
Order applied to only $161 million of more than $835 million of discretionary
grants awarded in 2003. Program offices awarded many assistance agreements
noncompetitive ly, some of which seemed inconsistent with the Order's
requirements. These conditions occurred because the Order overemphasized
exemptions and justifications for not competing assistance agreements. Also,
EPA staff misunderstood some requirements. As a result, EPA did not ensure that
it awarded discretionary grants to the most qualified recipients or for the most
innovative projects, thus potentially diminishing the Agency's efforts to
accomplish its mission.
The competitions reviewed were generally fair and open when measured against
the provisions contained in the Order. Program offices broadly advertised the
competitions and selected recipients based on published criteria. However, EPA
would benefit from additional policy on conflicts of interest and documentation
requirements.
In January 2005, EPA replaced the original Order with EPA Order 5700.5A1.
The revised order included numerous procedural changes and incorporated many
of our recommendations. However, the Agency disagreed with key
recommendations directed at increasing the number of assistance agreements
subject to competition.
What We Recommend
We continue to recommend that the Acting Assistant Administrator for the Office
of Administration and Resources Management increase the number of assistance
agreements subject to competition by eliminating certain exemptions and a
justification for not competing.

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