• U.S. Environmental Protection Agency	11-R-0172
i JUL, \ Office of Inspector General	March 22 2011
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At a Glance
Catalyst for Improving the Environment
Why We Did This Review
The U.S. Environmental
Protection Agency's Office of
Inspector General conducts
site visits of American
Recovery and Reinvestment
Act of 2009 (Recovery Act)
clean water and drinking water
projects. We selected a project
for the City of Astoria,
Oregon, for review.
Background
The city is constructing an
underground storage tank, an
odor control facility, and a
sanitary sewer pipeline as part
of its Denver Street Storage
Project. The project is funded
by two Clean Water State
Revolving Fund loans totaling
$7,475,436 from the Oregon
Department of Environmental
Quality (ODEQ). One of the
loans provided $4,000,000 in
Recovery Act funds, of which
50 percent of the loan
principal will be forgiven if
the city complies with the loan
agreement.
For further information,
contact our Office of
Congressional, Public Affairs
and Management at
(202) 566-2391.
The full report is at:
www.epa.aov/oia/reports/2011/
20110322-11 -R-0172.pdf
American Recovery and Reinvestment Act
Site Visit of the Denver Street Storage Project,
City of Astoria, Oregon
What We Found
We conducted an unannounced site visit of the Denver Street Storage Project in
the City of Astoria, Oregon, during June 2010. As part of our site visit, we toured
the project, interviewed city representatives and contractor personnel, and
reviewed documentation related to Recovery Act requirements.
We did not identify any compliance issues with Buy American, Davis-Bacon Act,
or funding requirements. However, we found that:
•	The city and ODEQ understated the number of jobs created or retained
with Recovery Act funds. Although the construction work performed for
the 6-month period ending June 30, 2010, was 100 percent funded by the
Recovery Act, the city and ODEQ reported only 62 percent of the full-
time equivalent jobs created or retained in the quarterly reports.
•	For one of four contracts awarded, a change order did not meet applicable
procurement requirements. During removal of a tank, additional
contamination was discovered that resulted in the original award of
$9,960 being increased to $67,306, a difference of $57,346. The increase
required the city to award a new competitive contract, but it did not do so.
What We Recommend
We recommend that Region 10's Regional Administrator require ODEQ to require
the city to correct the reported number of jobs created or retained, obtain the
corrections for the reported number of jobs created or retained from the city and
maintain the corrected documentation in administrative records, and submit
corrections to the federal government. We also recommend that Region 10's
Regional Administrator require ODEQ to disallow $57,346 in costs incurred under
the change order unless the city is able to show that the costs meet applicable
Oregon requirements.
Region 10 and ODEQ agreed with recommendations 1, 2, and 4, but initially had
concerns with recommendation 3. The city agreed with all four recommendations.
After discussing the recommendations during the exit conference, the region
agreed with recommendation 3 and ODEQ concurred with the corrective action.

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