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s	U.S. Environmental Protection Agency	2006-P-00012
|	\	Hffirp nf Insnprtnr ^pnpral	February 28, 2006
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Office of Inspector General
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At a Glance
Why We Did This Review
We conducted this followup
review on a 2004 audit of
contract administration by the
Environmental Protection
Agency's (EPA's) Office of
Underground Storage Tanks
(OUST). We sought to
determine whether OUST took
sufficient actions regarding
proper charging to
appropriations, avoiding the
loss of funding due to
expiration of funds, and
obligating funds with
corresponding work
assignments.
Background
On March 31, 2004, we issued
a report, The Office of
Underground Storage Tanks:
Contract Administration and
Performance Measurement
Concerns (2004-P-00014).
This report disclosed OUST
had inappropriately used and
inefficiently managed contract
funds.
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.aov/oia/reports/2006/
20060228-2006-P-00012.pdf
Catalyst for Improving the Environment
Office of Underground Storage Tanks Has Improved
Contract Administration, But Further Action Needed
What We Found
Of the nine corrective actions OUST proposed as a result of the previous review, it
successfully implemented eight actions. In particular, OUST stopped obligating
funds to contracts without identifying corresponding work. We commend OUST
for successfully implementing these actions. However, while OUST provided
Contract Management Manual training for its staff, as agreed, it did not have all
required people attend the training.
During our followup review, we noted problems regarding properly charging to
appropriations. Our prior report had concluded that $134,000 in Leaking
Underground Storage Tank (LUST) funds had been obligated to a contract but not
expended, and that amount had increased to $395,000 by March 2005. That
amount represented potential missed opportunities for achieving environmental
improvements. As a result of our followup review, OUST initiated a contract
modification in November 2005 to deobligate and recertify these funds.
Also, OUST had not taken sufficient corrective action regarding $140,004 in work
paid for with LUST funds that should have been paid with Environmental
Program Management funds. OUST initiated corrective action in February 2004,
but erroneously used future year funds to pay for prior year services. For
example, OUST paid for Fiscal Year 2002 services with Fiscal Year 2003/2004
funds. OUST initiated a modification in October 2005 to correct this situation.
What We Recommend
We recommend that the OUST Director have staff regularly query EPA's financial
systems to monitor the status of funds obligated, to enable deobligations when
appropriate. We also recommend that the Director direct staff to not use future
year appropriations to pay for services rendered in prior years, and to require that
all appropriate staff attend training in appropriations. OUST concurred with our
recommendations and agreed to monitor the status of its funds obligated to
contracts on a monthly basis and to provide direction and training to its staff.

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