U.S. Environmental Protection Agency	08-2-0095
Office of Inspector General	February 27,2008

At a Glance
Catalyst for Improving the Environment
Why We Did This Review
The U.S Environmental
Protection Agency (EPA)
Office of Inspector General
(OIG) conducted a review of
earmarked grants known as
Special Appropriation Act
Projects issued to local and
tribal governments. We
selected the City of Bad Axe,
Michigan, for review.
Background
The City of Bad Axe received
an EPA Special Appropriation
Act Project grant,
XP98578301. The purpose of
the grant was to provide
Federal assistance for
engineering, planning, and
constructing a 17-mile
drinking water pipeline from
Port Austin, Michigan, to the
City of Bad Axe.
City of Bad Axe, Michigan - Unallowable Costs
Claimed Under EPA Grant XP98578301
What We Found
The City of Bad Axe (grantee) purchased two parcels of land totaling $51,297
without obtaining prior approval as required by Federal regulations. The grantee
also paid an engineering firm $211,143 to design a water treatment facility but
did not use the design. As a result, EPA needs to recover $262,440 under Grant
XP98578301.
What We Recommend
We recommend that the Regional Administrator, EPA Region 5, recover the
unallowable land purchase and design costs totaling $262,440.
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/2008/
20080227-08-2-0095. pdf

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