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U.S. ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF INSPECTOR GENERAL
Operating efficiently and effectively
EPA Needs to Improve
Its Planning and
Management of Laboratory
Consolidation Efforts
Report No. 21-E-0033
December 7, 2020
Western
•CORVALLIS, OR 97333
Office of Research & Development
National Health & Environmental Effects
Research Laboratory
Western Ecotogy Division
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Report Contributors:
Michael Davis
Madhu Dev
Ashley Langer
Nicole Pilate
Gloria Taylor-Upshaw
Abbreviations
EPA U.S. Environmental Protection Agency
GAO U.S. Government Accountability Office
OIG Office of Inspector General
OMS Office of Mission Support
Cover Photos: Three facilities involved in the EPA's laboratory consolidation efforts.
Left: National Vehicle and Fuel Emissions Laboratory in Ann Arbor,
Michigan. Top right: Western Ecology Division Research Laboratory, which
has been renamed the Pacific Ecological Systems Division, in Corvallis,
Oregon. Bottom right: Ecosystem Research Division Laboratory in Athens,
Georgia. (EPA OIG photos)
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U.S. Environmental Protection Agency 21-E-0033
^ \ Office of Inspector General December 7,2020
Isszz;
¦... At a Glance
Why We Did This Evaluation
We conducted this evaluation
to determine whether the
U.S. Environmental Protection
Agency's laboratory
consolidation efforts in Athens,
Georgia; Corvallis, Oregon; and
Ann Arbor, Michigan, are within
cost and on schedule.
Based on its March 2015
Synthesis Report of the US
EPA Laboratory Enterprise
Evaluation, the EPA concluded
that it could realize
approximately $409 million in
avoided costs and savings over
30 years. The Synthesis Report
included actions and options
regarding which laboratory
facilities to consolidate or
co-locate. As the Agency's
central planner and
coordinator, the Office of
Mission Support's Real
Property Services Division is
responsible for the oversight of
laboratory consolidation efforts.
EPA Needs to Improve Its Planning and Management
of Laboratory Consolidation Efforts
What We Found
The EPA needs to improve how it plans and
manages its laboratory consolidation efforts.
For the three projects we reviewed, we found
that the Office of Mission Support did not:
• Develop a master plan to guide the Ann
Arbor laboratory consolidation effort. As
of February 2020, the Agency had
expended over $2 million for this project
without having a master plan.
Without improved management
controls, the EPA risks
continued cost overruns and
delays in its laboratory
consolidation efforts.
Overruns and delays will
reduce the Agency's potential
avoided costs and savings of
approximately $409 million
over 30 years.
• Document key decisions related to laboratory consolidation activities.
As a result, the Agency did not have documentation explaining why projects were
delayed or why it incurred over $8 million in cost overruns for the Corvallis and
Athens laboratory consolidation efforts.
The development and implementation of procedures and detailed requirements
for managing laboratory consolidation efforts would reduce the risk of excessive
cost overruns and delays. Better management of the projects could also help the
EPA meet its goal of reducing the number of leases and cost of facility
management, which would allow the Agency to direct resources to core
environmental work.
This evaluation addresses the
following:
• Operating efficiently and
effectively.
This evaluation addresses a top
EPA management challenge:
• Complying with key internal
control requirements (data
quality).
Recommendations and Planned Agency Corrective Actions
We recommend that the assistant administrator for Mission Support develop and
implement procedures that include detailed requirements for planning and
managing laboratory consolidation efforts. These requirements should address
developing master plans and program requirements, tracking and updating cost
and schedule estimates, and maintaining decisional documentation.
The EPA agreed with our recommendation. The recommendation is resolved with
corrective action pending,
Address inquiries to our public
affairs office at (202) 566-2391 or
OIG WEBCOMMENTS@epa.gov.
List of OIG reports.
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UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
THE INSPECTOR GENERAL
December 7, 2020
MEMORANDUM
SUBJECT: EPA Needs to Improve It's Planning and Management of Laboratory
Consolidation Efforts
Report No. 21-E-0033
FROM: Sean W. O'Donnell
byiMQ,
j
TO:
Donna J. Vizian, Principal Deputy Assistant Administrator
Office of Mission Support
This is our report on the subject evaluation conducted by the Office of Inspector General of the
U.S. Environmental Protection Agency. The project number for this evaluation was OA&E-FY20-0353.
This report contains findings that describe the problems the OIG has identified and corrective actions the
OIG recommends. Final determinations on matters in this report will be made by EPA managers in
accordance with established audit resolution procedures.
The EPA's Office of Mission Support is responsible for implementing the recommendation in this report.
In accordance with EPA Manual 2750, your office provided acceptable corrective actions in response to
the recommendation in this report. Corrective actions are pending, and no final response to this report is
required. However, if you submit a response, it will be posted on the OIG's website, along with our
memorandum commenting on your response. Your response should be provided as an Adobe PDF file
that complies with the accessibility requirements of Section 508 of the Rehabilitation Act of 1973, as
amended. The final response should not contain data that you do not want to be released to the public; if
your response contains such data, you should identify the data for redaction or removal along with
corresponding justification.
We will post this report to our website at www.epa.gov/oig.
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EPA Needs to Improve Its Planning
and Management of Laboratory
Consolidation Efforts
21-E-0033
Table of C
Chapters
1 Introduction 1
Purpose 1
Background 1
Responsible Offices 5
Scope and Methodology 5
2 EPA Needs to Follow Existing Guidance and Implement Requirements for
Laboratory Consolidation Efforts 8
OMS Did Not Develop Ann Arbor Consolidation Master Plan and
Program of Requirements 8
OMS Did Not Create and Maintain Documentation of Decisions Related to
Consolidations 9
EPA Does Not Have Specific Procedures and Requirements for
Planning and Tracking Consolidations 10
EPA Risks Not Meeting Projected Savings and Lease Reduction Goals.... 10
Recommendation 13
Agency Response and OIG Assessment 13
Status of Recommendation and Potential Monetary Benefits 15
Appendices
A Reports Related to EPA's Laboratory Consolidation Efforts 16
B Agency Response to Draft Report 17
C Distribution 19
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Chapter 1
Introduction
Purpose
The U.S. Environmental Protection
Agency's Office of Inspector General
conducted this evaluation to determine
whether the EPA's laboratory consolidation
efforts in Athens, Georgia; Corvallis,
Oregon; and Ann Arbor, Michigan, were
within cost and on schedule.
Top Management Challenge
This evaluation addresses the following top
management challenge for the Agency, as
identified in OIG Report No. 20-N-0231.
EPA's FYs 2020-2021 Top Management
Challenges, issued July 21, 2020:
• Complying with key internal control
requirements (data quality).
Background
In 2007, the then-EPA administrator requested that the Agency perform both a
short-term review and long-term evaluation of its laboratory enterprise. In
response to the administrator's short-term review request, the EPA published
Commonsense Actions and Best Practices that Improve Laboratory Efficiency and
Effectiveness in October 2008, which detailed over 500 actions that EPA
laboratories could take to reduce their environmental impact and improve
efficiency. In response to the administrator's long-term evaluation request, the
EPA published its Synthesis Report of the US EPA Laboratory Enterprise
Evaluation in March 2015, which noted specific actions the EPA could take in
relation to its laboratory enterprise. Based on this Synthesis Report, the EPA
concluded, among other things, that savings may be realized by shifting
laboratories from leased facilities to owned facilities where additional space
capacity exists.
The Synthesis Report is the culmination of an EPA analysis, a consulting firm's
assessments, and an expert committee report that provided the EPA with
information about its laboratory network. Specifically, the EPA began an analysis
of its laboratory network in December 2012 to identify how to increase the
efficiency of its facilities and the effectiveness of its science, while also retaining
its ability to provide the research, science, and technical support that advances its
mission. As part of this study, the EPA worked with a consulting firm to develop
a framework for analyzing options to increase the efficiency of the Agency's
laboratory enterprise. The EPA also requested recommendations for strengthening
the effectiveness of its laboratory enterprise from an independent expert
committee convened by the National Research Council of the National Academy
of Sciences. The Synthesis Report presents the collective results of these efforts to
provide conclusions about and identify how the Agency could proceed.
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Appendix A lists reports related to this overall
effort that were issued between October 2008
and March 2015.
EPA Synthesis Report Recommends
Actions to Consolidate EPA's
Laboratory Enterprise
The purpose of the EPA's Synthesis Report is
"to present a summary of the completed
analysis, provide observations and conclusions,
and identify actions that EPA could undertake
to improve its laboratory enterprise for the
longer term." The Synthesis Report states that
the information it presents will help the EPA
make decisions that could increase the
efficiency and effectiveness of its laboratory
enterprise. This report serves as the basis for the Agency's laboratory
consolidation efforts.
As cited in the Synthesis Report, the EPA's laboratory enterprise in 2012
consisted of 34 facilities that provide critical scientific, technical, and research
support for numerous Agency decisions, including those about health standards,
emergency response, and enforcement. These faciliti es included a mix of leased
and owned laboratories (Table 1).
Table 1: EPA laboratory inventory by ownership type
EPA laboratory ownership type*
Number of
facilities
Owned by:
EPA
19
U.S. General Services Administration
EPA uses facilities under the control of the General Services Administration.
2
Leased by:
EPA
EPA leases these laboratories directly from a landlord.
4
General Services Administration
The General Services Administration leases these laboratories from a private owner.
8
Other:
Special Use Agreement
EPA personnel may be co-located with other federal agencies or with state or local entities
with mutual interests.
1
Total
34
Source: EPA's Synthesis Report of the US EPA Laboratory Enterprise Evaluation, page 9.
(EPA OIG table)
* Ownership type definitions and examples are adopted from EPA's Nationwide Facilities Guide.
*>EPA
Synthesis Report of the
US EPA Laboratory
Enterprise Evaluation
Cover page of the EPA's synthesis
report. (EPA image)
21-E-0033
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Based on an analysis of several different scenarios, the Synthesis Report
concludes that the EPA could reduce its laboratory footprint by approximately
380,000 gross square feet and the number of its laboratory facilities from 34 to 26.
The March 2015 Synthesis Report states that with the full support of the then-
EPA administrator and deputy administrator, the Agency decided that it should
move forward with a proposed course of action that includes the following actions
and options:
• Reproductive Toxicology Facility in Durham, North Carolina.
Consolidate activities conducted at the Reproductive Toxicology Facility
into the nearby Research Triangle Park, North Carolina, main building.
• Grosse lie, Michigan. Discontinue laboratory activities in the Grosse lie
facility, designating it as a field station.
• Bay St. Louis, Mississippi. Consolidate laboratory activities conducted at
the Bay St. Louis facility into the Fort Meade, Maryland, laboratory.
• Wheeling, West Virginia. Discontinue laboratory activities and conduct
activities at the Fort Meade laboratory.
• Golden, Colorado. Discontinue the lease for the Region 8 laboratory and
co-locate the laboratory with the nearby National Enforcement
Investigations Center facility in Lakewood, Colorado.
• Willamette Research Station in Corvallis, Oregon. Consolidate the
Willamette Research Station into the nearby laboratory facility in
Corvallis, Oregon.
• Athens, Georgia. Assess all options, including co-locating, consolidating,
or upgrading the laboratory, as well as retaining the laboratory's "as-is"
footprint.
• Chelmsford, Massachusetts. Assess all options, including co-locating,
consolidating, and upgrading this leased laboratory, as well as retaining
the laboratory's "as-is" footprint.
By taking the above actions to reduce its laboratory footprint, the EPA concluded
that it could realize approximately $409 million in avoided costs and savings over
30 years.
As noted in the Synthesis Report, any laboratory actions would require detailed
site-specific master planning to further inform decision-making. The report
recommends that the Office of Administration and Resources Management—
which in November 2018 was merged with the Office of Environmental
Information to create the Office of Mission Support, or OMS—prepare portfolio-
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level and site-specific master plans to effectively manage the EPA's laboratory
facilities and strategically assess specific needs; estimate costs, savings, and
environmental benefits; and implement practical actions to improve the efficiency
of the laboratories.
Agency Guidance for Construction and Renovations
The EPA's guidance for facilities includes a master planning process that involves
a detailed site investigation to assess facility and site conditions, as described in
the EPA's Nationwide Facilities Guide. Although this guidance does not list
specific requirements for laboratory consolidation efforts, its master planning
process includes interviewing facility staff and management to identify areas that
do not meet the needs of the program or region. A preliminary master plan is then
developed for each project, along with cost estimates and implementation
strategies. Per the Guide, the master plan should be updated about every
five years to incorporate changes in program requirements.
The EPA's guidance for facilities also includes the EPA Facilities Manual:
Volume 2, Architecture and Engineering Guidelines. As part of the master
planning process, this Manual directs the EPA project manager, representatives
from the EPA's Real Property Services Division, and the director and EPA
facility manager for the project location, as appropriate, to coordinate to develop a
program of requirements. The intent is that all parties involved understand the
project goals and requirements. The program of requirements should include:
• An overview of the project scope, objectives, requirements, and
performance criteria.
• A description of the facility spaces to be constructed or renovated;
area requirements for interior spaces; and area requirements for
exterior spaces, if applicable.
The U.S. Government Accountability Office's GAO Cost Estimating and
Assessment Guide: Best Practices for Developing and Managing Capital
Program Costs states that "documentation should be done in parallel with the cost
estimate's development, so that the quality of the data, methods, and rationale are
fully justified." A high quality cost estimate process consists of clearly defining
what the estimate includes and excludes, as well as identifying the program
schedule by phase. Additionally, the GAO's Schedule Assessment Guide: Best
Practices for Project Schedules states that a project schedule is necessary to
provide not only a road map for systematic project execution but also the means
to gauge progress, identify and resolve potential problems, and promote
accountability at all levels of the program. A schedule provides a time sequence
for the duration of a program's activities and helps everyone understand both the
dates for major milestones and the activities that drive the schedule.
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Obtaining funding for projects is a separate process from the master planning
process. Federal agencies request congressional approval for funding through
congressional justifications following the submission of the president's budget.
Funds are then approved by Congress and are available for federal agencies to
spend, subject to any limitations imposed by Congress.
Responsible Offices
The OMS's Office of Administration's Real Property Services Division is
responsible for the Agency's fixed property, which includes land and buildings,
such as the EPA's laboratory enterprise. As such, it is responsible for the
oversight of laboratory consolidation efforts, serving as the central planner and
coordinator for facilities while delegating control of the management of EPA
facilities.
The OMS's Office of Resources and Business Operations staff serve as the
principal staff to the assistant administrator for Mission Support on matters
related to program management, budget, human resources, communications,
workforce development programs, and administrative operations.
OMS project managers visit sites once or twice a month to conduct oversight
activities during active construction. OMS project managers also hold weekly
teleconferences with contractors and regional and program laboratory personnel.
According to the OMS, other stakeholders also have various roles and
responsibilities related to the Agency laboratory consolidation efforts:
• The EPA's Office of Research and Development provides environmental
decommissioning due-diligence efforts to ensure that laboratories are not
at risk of contaminating the environment during construction efforts.
• Regional and program laboratory personnel, such as laboratory directors,
facility managers, and branch chiefs, aid in developing master plans for
consolidation efforts.
• The OMS's Office of Acquisition Solutions provides procurement
services for construction and support services.
• Regional human resources offices provide relocation services to the
regions and program offices at the direction of the OMS.
• Contractors provide consolidation construction services at the facilities.
Scope and Methodology
We conducted our evaluation from October 2019 to September 2020 in
accordance with the Quality Standards for Inspection and Evaluation published in
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January 2012 by the Council of the Inspectors General on Integrity and
Efficiency. Those standards require that we plan and perform the evaluation to
obtain sufficient, appropriate evidence to provide a reasonable basis for our
findings, conclusions, and recommendations based on our review objective. We
believe that the evidence obtained provides a reasonable basis for our findings,
conclusions, and recommendations based on our review.
To identify applicable criteria for laboratory consolidation efforts, we reviewed
federal guidance and EPA policies, including:
• Office of Management and Budget, Circular No. A-123, Management's
Responsibility for Enterprise Risk Management and Internal Control,
dated July 2016.
• GAO Cost Estimating and Assessment Guide: Best Practices for
Developing and Managing Capital Program Costs, dated March 2009.
• GAO, Schedule Assessment Guide: Best Practices for Project Schedules,
dated December 2015.
• EPA Facilities Manual: Volume 2, Architecture and Engineering
Guidelines, dated June 2019.
• EPA's Nationwide Facilities Guide, dated June 2009.
To address our evaluation objective, we reviewed the EPA's activities for three of
its laboratory consolidation efforts. We selected these three projects based on our
review of the EPA's fiscal year 2020 Congressional Justification, which
highlighted their costs and schedules (Table 2).
Table 2: Laboratory consolidation efforts evaluated by OIG
Consolidation
effort
Estimated cost
Estimated
completion
date
Facilities to be consolidated
Facility
location
Ownership type
Corvallis
$46 million
January 2023
Western Ecology Division*
Corvallis
EPA owned
Willamette Research Station
Corvallis
EPA owned
Central Regional Laboratory
(Region 9)
Richmond,
California
EPA leased
Athens
$51 million
September
2025
Ecosystem Research Division
Laboratory*
Athens
EPA owned
Science and Ecosystem
Support Division
Athens
General Services
Administration
leased
Ann Arbor
Undetermined.
EPA did not
develop a master
plan for this effort.
Fiscal year
2019
National Vehicle and Fuel
Emissions Laboratory*
Ann Arbor
EPA owned
Large Lakes and Rivers
Forecasting Research Branch
Grosse lie,
Michigan
EPA owned
Source: OIG analysis of EPA's fiscal year 2020 Congressional Justification and EPA cost data. (EPA OIG table)
* Red text denotes the facility into which the other facility or facilities at each site are being consolidated.
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In November 2019 and January 2020, we toured five laboratory facilities located
in Ann Arbor, Athens, Corvallis, and Richmond.
For each laboratory consolidation effort that we evaluated, we reviewed
documents from the EPA's
Acquisition System and Compass
Data Warehouse. We held interviews
with OMS, Office of Research and
Development, and regional staff, as
well as with laboratory personnel at
the facilities relevant to our
evaluation. We also obtained and
reviewed master plans, statements of
work, congressional justifications, the presidential budget, contracts, and actual
cost data for the related consolidation efforts. We based our review of cost and
schedule data on the completed construction phases for each of the three
laboratory consolidation efforts as of February 2020.
EPA's Acquisition System
The EPA's Acquisition System serves as a modern,
integrated, web-based, centralized system for EPA
acquisitions. It enables all key stakeholders in the
procurement process to use one automated system
throughout the acquisition life cycle, from
requisitioning to contract closeout.
Source: easinfo.epa.gov
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Chapter 2
EPA Needs to Follow Existing Guidance and
Implement Requirements for Laboratory
Consolidation Efforts
The EPA needs to improve its planning and management of laboratory
consolidation efforts. For the three consolidation efforts we reviewed, we found
that the OMS did not:
• Develop a master plan to guide the Ann Arbor consolidation effort.
• Document key decisions related to consolidation activities.
The OMS did not have standard procedures and requirements for planning and
managing laboratory consolidation efforts. If the Agency continues to incur cost
overruns and does not complete consolidation efforts on schedule, the EPA will
not achieve the estimated $409 million in avoided costs and savings over 30 years
that it projected based on the Synthesis Report. As of February 2020, the Agency
had incurred a combined $8 million in cost overruns for the Corvallis and Athens
consolidation efforts.
Federal policy states that management is responsible for establishing and
maintaining internal controls, implementing management practices, and maintaining
documentation to demonstrate operating effectiveness. Additionally, the GAO's
best practices for developing and managing capital program costs state that
documentation should be done in parallel with the cost estimate's development.
OMS Did Not Develop Ann Arbor Consolidation Master Plan and
Program of Requirements
The OMS did not develop a master plan and program of requirements for the Ann
Arbor laboratory consolidation effort. In May 2017, the OMS proposed installing
a prefabricated building in the Ann Arbor laboratory facility to house the
Agency's Region 5 and Criminal Investigation Division personnel from the Large
Lakes and Rivers Forecasting Research Station in Grosse lie. By September 2019,
the consolidation effort was complete.
The OMS did not follow the EPA Facilities Manual: Volume 2, Architecture and
Engineering Guidelines; the GAO Cost Estimating and Assessment Guide; or the
EPA's Nationwide Facilities Guide to establish the projected cost and schedule of
the Ann Arbor consolidation effort in a master plan or program of requirements.
The OMS told us that master plans are developed to assess space and infrastructure
needs for EPA sites that will remain occupied and operational. The OMS should
have created a master plan and program of requirements for the Ann Arbor
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consolidation to determine the cost and
schedule for installing a prefabricated
building into the Ann Arbor laboratory
facility. Instead, the Agency determined
the costs and schedule for the
consolidation effort as it progressed
through the acquisition process.
The OMS spent $2,460,829 and took
over two years to complete the Ann
Arbor consolidation effort, but it did
not have any planned costs and
schedule against which to measure the
progress of the Ann Arbor project. If
the EPA follows its procedures and implements the requirements for a master plan
and program of requirements during consolidation efforts, the Agency could
better plan costs and scheduling expectations for these projects.
OMS Did Not Create and Maintain Documentation of Decisions
Related to Consolidations
The OMS did not maintain documentation for management decisions—such as
those involving project start dates or significant project changes—that related to
the three laboratory consolidation efforts we reviewed. The OMS supposedly
relied on and used the EPA's Acquisition System to maintain, document, and track
changes to the consolidation efforts. However, we did not find documents in the
system to support OMS decisions related to the projects. For example, the EPA's
Acquisition System did not include documentation regarding the decision to add
the Richmond laboratory to the Corvallis consolidation project, nor was there
documentation regarding the specific cost methods used for the project estimates.
Instead, the system housed only documents related to the contract modifications.
OMS staff referred us to the president's budget and OMS senior officials for
decisional documents, which the staff used as a basis for any formalized decisions
to start the consolidation efforts. When we asked senior officials in the OMS's
Office of Resources and Business Operations about decisional documents, they
stated that the Agency communicated and documented the decisions in the
president's budget. The president's budget does not, however, explain why or
how the OMS made decisions regarding the consolidation efforts. Additionally,
OMS staff stated that they used their professional judgement and prior projects to
estimate costs for the consolidation effort.
The OMS should have a project file outside of the EPA's Acquisition System that
documents management decisions. The GAO Cost Estimating and Assessment
Guide: Best Practices for Developing and Managing Capital Program Costs
states that poorly documented estimates can cause a program's credibility to
Prefabricated buildings inside the EPA's Ann Arbor laboratory
facility housing the EPA Region 5 and Criminal Investigation
Division staff from Grosse lie. (EPA OIG photo)
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suffer because the documentation cannot explain the rationale of the underlying
cost elements. The OMS should create and maintain documentation for
management decisions and cost estimates to show that they are accurate,
complete, and high quality, since many cost estimates are developed to support a
budget request or facilitate a decision between competing alternatives.
EPA Does Not Have Specific Procedures and Requirements for
Planning and Tracking Consolidations
OMS staff used the EPA's Acquisition System to manage the laboratory
consolidation efforts. They also used their knowledge and experience to determine
how costs should be updated. TheEPA Facilities Manual and Nationwide
Facilities Guide outline general guidelines regarding project management, but
except for the procurement process, the Manual and Guide do not provide specific
requirements for project management, such as planning, tracking, updating
projects, or maintaining documentation related to projects.
Additionally, the OMS did not have its own methodology to track and document
the costs and schedules for consolidation efforts. OMS staff said that any changes
to consolidation efforts are documented, approved, and tracked through the
procurement process and placed in the EPA's Acquisition System. As we noted
previously in this chapter, however, the OMS did not have records that explained
changes in project costs and schedules.
Office of Management and Budget Circular No. A-123, Management's
Responsibility for Enterprise Risk Management and Internal Control, states that
documentation is required to demonstrate the design, implementation, and
operating effectiveness of an entity's internal control system. The OMS should
have specific requirements to support its laboratory consolidation efforts,
including tracking changes to project costs and schedules.
EPA Risks Not Meeting Projected Savings and Lease Reduction Goals
As of February 2020, the Agency incurred over $8 million in cost overruns for the
Corvallis and Athens laboratory consolidation efforts. It also expended over
$2 million for the Ann Arbor consolidation effort without a master plan or a
program of requirements in place to manage the project. If the OMS continues to
exceed project costs and does not complete consolidations on schedule, the EPA
will not achieve the potential avoided costs and savings of approximately
$409 million over 30 years that it projected based on the Synthesis Report. By
developing and implementing a process, procedures, and detailed requirements,
the EPA will more effectively manage and track its consolidation efforts, as well
as maintain decisional documentation related to these efforts. In addition, the EPA
could meet its goal of reducing the number of leased facilities and the cost of
facility management, which would allow the Agency to direct resources to core
environmental work.
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Cost Overruns and Delays Incurred for Corvallis and Athens
Consolidation Efforts
As of February 2020, the OMS spent approximately $8.5 million over its planned
costs for the completed phases of the Corvallis and Athens consolidation efforts.
Specifically, the OMS spent almost $7.0 million over its planned cost for the
Corvallis consolidation effort and almost $1.5 million over its planned cost for the
Athens consolidation effort (Table 3). The OMS attributed some cost overruns to
cost escalations and contract modifications for unplanned design changes.
Table 3: Cost overruns for Corvallis and Athens laboratory consolidation efforts
Consolidation effort
Planned costs
Actual costs
Costs overruns
Corvallis
$12,457,600
$19,448,817
$6,991,217
Athens
4,562,586
6,056,076
1,493,490
Total
$17,020,186
$25,504,893
$8,484,707
•Source: OIG analysis of EPA's Corvallis and Athens laboratory consolidation cost data.
(EPA OIG table)
OMS staff said that because they did not have enough funding for the Corvallis
and Athens consolidation efforts, they requested five years of additional funding
from Congress in 2015 for those projects. The Agency should consider its
funding capabilities when updating cost estimates and schedules for laboratory
consolidation efforts.
Corvallis and Athens Consolidation Efforts Were Behind Schedule
As of February 2020, the OMS was over two years behind its plans to consolidate
facilities at Corvallis and more than one year behind its plans for the Athens
facilities. The OMS stated that schedules can be impacted if the laboratory
consolidation efforts are not
funded as originally forecasted,
since schedules are directly tied to
funding availability. Flaving
specific procedures that require
updates to consolidation project
schedules when there are
significant project changes or
delays would help align the
affected phase completion dates.
Corvallis Consolidation Effort Delays
The Corvallis consolidation effort was scheduled to start in July 2013 and be
completed in June 2017. Table 4 shows that none of the phases of the project
that were completed as of February 2020 were finished on schedule. From
actual contract expenditures, we verified that the two completed phases started
on time but were not completed until December 2019, over two years after the
The EPA's main Office of Research and Development
Laboratory in Athens. (EPA OIG photo)
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expected completion dates. Corvallis facility staff stated that the longer a
consolidation effort is delayed, the more impact the delays have on an office's
ability to meet its mission requirements. For example, the Willamette
Research Station suspended its research efforts until it had a place to perform
analyses. As a result of the construction delays, Corvallis staff were concerned
that they would not meet the deadline for a congressionally required National
Aquatic Research survey and report.
Table 4: Corvallis consolidation effort schedule delays
Corvallis consolidation
completed phases
Contract
number
Task order
Expected
completion
date
Actual
completion date
Months
over
schedule
Phase 1a: Lab Modernization—
Corvallis Design
EP-C-12-026
00003
November 2013
August 2015
21
00007
January 2017
September 2018
20
00008
June 2016
January 2017
7
Phase 1a: Lab Modernization—
Corvallis Construction
EP-C-15-029
00001
January 2017
December 2019
35
Phase 2: Lab Modernization—
Corvallis Design (Pacific
Southwest Laboratory)
EP-C-12-026
0011
June 2017
October 2019
28
Source: OIG analysis of EPA's Corvallis laboratory consolidation schedule data. (EPA OIG table)
Athens Consolidation Project Delays
The Athens consolidation effort began in September 2017, and the OMS
forecasted that Phase 2 would be completed by November 2019. As shown in
Table 5, none of the phases were completed on time. In fact, construction for
Phase 2, which is estimated to take one year to complete, had not started as of
February 2020. By the time Phase 2 construction begins, the OMS will
already be behind schedule.
Table 5: Athens consolidation schedule delays
Athens consolidation
phases
Contract
number
Task order
Expected
completion
date
Actual
completion
date
Months
over
schedule
Phase 1: Design, build and
renovations of Lifespan
building
EP-C-17-050
N/A
July 2018
April 2019
9
Phase 2/3: Main lab and
outbuilding design
EP-C-17-026
N/A
August 2019
January 2020
5
Phase 2: Outbuilding
construction
This phase was planned to be completed by November 2019; however, EPA had
not started as of February 2020.
Source: OIG analysis of EPA's Athens laboratory consolidation schedule data. (EPA OIG table)
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Recommendation
We recommend that the assistant administrator for Mission Support:
1. Develop and implement procedures that include detailed requirements for
planning and managing laboratory consolidation efforts. Requirements
should address developing master plans and programs of requirements,
tracking and updating cost and schedule estimates, and maintaining
decisional documentation.
Agency Response and OIG Assessment
The EPA agreed with our recommendation. The OMS stated that it will develop
programmatic changes that will address our concerns. Initially, the OMS
proposed the following corrective actions, which it expected to complete by
December 31, 2020:
• Continue developing programs of requirements listed in the EPA
Facilities Manual: Volume 2, Architecture and Engineering Guidelines.
• Update the cost-and-schedule tracking systems and the status-of-funds
reporting process.
• Continue to report and document consolidation decisions in the
Agency's annual presidential budget submission and the Federal Real
Property Profile.
On September 29, 2020, and October 15, 2020, however, we emailed the
OMS with concerns that these initial proposed corrective actions did not
address requirements for developing master plans and maintaining decisional
documentation. In an October 23, 2020 email, the OMS clarified its proposed
corrective actions and provided additional information on master planning and
decisional documentation. Specifically, the OMS stated:
OMS will include the [Program of Requirement] for cost
estimating compliance in the EPA project management checklist
for all future Scope of Work Documents - which will be verified
through each project specific checklist.
Master Planning requirements and scopes are site specific.
However, each Scope of Work for a master plan contains the same
overarching requirements for the information to be included in the
site specific master plan. OMS will incorporate a section into the
A & E guideline Volume 2, showing the requirements for the
information to be included in each site specific master plan.
OMS will maintain decisional documents as part of the project file.
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With these clarifications, the EPA's planned corrective actions and estimated
milestone date satisfy the intent of our recommendation, and we consider the
recommendation resolved with corrective actions pending.
The Agency's response to the draft report is in Appendix B.
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Status of Recommendation and
Potential Monetary Benefits
RECOMMENDATIONS
Potential
Planned Monetary
Rec. Page Completion Benefits
No. No. Subject Status1 Action Official Date (In $000s)
1 13 Develop and implement procedures that include detailed R Assistant Administrator for 12/31/20
requirements for planning and managing laboratory consolidation Mission Support
efforts. Requirements should address developing master plans
and programs of requirements, tracking and updating cost and
schedule estimates, and maintaining decisional documentation.
1 C = Corrective action completed.
R = Recommendation resolved with corrective action pending.
U = Recommendation unresolved with resolution efforts in progress.
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Appendix A
Reports Related to EPA's Laboratory
Consolidation Efforts
Document title
Document issuer
Date issued
Report summary
Commonsense Actions
and Best Practices that
Improve Laboratory
Efficiency and
Effectiveness
EPA
October 2008
This report serves as the EPA's response to
the administrator's request for a near-term
review of the EPA's laboratory enterprise. The
report suggests that a more comprehensive
study be performed to look at ways to
enhance resource sharing through bulk
purchasing, co-location, and specialized
equipment sharing and purchasing, as well as
ways to share the broad range of technical
expertise available within the EPA.
Streamlining
Government
Questions to Consider
When Evaluating
Proposals to
Consolidate Physical
Infrastructure and
Management Functions
GAO
May 2012
This report addresses the components of a
successful laboratory consolidation effort and
outlines fundamental questions to consider
when evaluating consolidation proposals.
Rethinking the
Components,
Coordination, and
Management of US EPA
Laboratories
National Research
Council
September
2014
The report assessed the Agency's highest-
priority needs for mission-relevant laboratory
science and technical support to develop
principles for the efficient and effective
management of the EPA's laboratory
enterprise.
Environmental
Protection Agency
Nationwide Laboratory
Assessment
Smithgroup JJR
(contractor)
February 2015
This nationwide assessment of the EPA's
laboratory enterprise was developed to study
and evaluate the efficiency of the laboratory
portfolio and provide the EPA with tools and
options to assist with future decision-making.
Synthesis Report of the
US EPA Laboratory
Enterprise Evaluation
EPA
March 2015
In 2012, the EPA began this evaluation to
identify opportunities to increase its efficiency
and effectiveness while ensuring its ability to
fulfill its mission. The EPA's conclusions in
this evaluation were based on the National
Research Council's and contractor's reports
to realize savings by shifting from leased
facilities to EPA-owned facilities.
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Appendix B
Agency Response to Draft Report
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
on lot. 01 mission surroRi
MEMORANDUM
SUBJECT: Response lo (Mice of Inspector General 1 )ral't Report Project No. OA&E-EY20-
0353 "7:7'. I Seeds Better Planning and ('onirols to Improve Its Management of
Laboratory Consolidations." dated Septembers. 2020
DONNA
FROM: Donna J. Vizian, Principal Deputy Assistant Administrator VIZIAN
Digitally signed by
DONNA VIZIAN
Date; 2020.09.29
08:54:35 -M'OO'
TO:
Michael Davis. Efficiency Directorate
Ollice of Audit and 1'valuation
( M'lice of Inspector General
Thank you for the opportunity to respond to the issues and recommendations in the subject audit
report. The following is a summary of the Office of Mission Support's position.
AGENCY'S OVERALL POSITION
We agree with the report's findings and have begun to develop programmatic changes which will
address the concerns of the Office of Inspector General.
QMS RESPONSE TO REPORT RECOMMENDATION 1
No.
Recommendation
High-Level Intended Corrective
Action(s)
Estimated
Completion Date
1
Develop and implement procedures
that include detailed
requirements for planning and
managing laboratory consolidation
efforts. Requirements should
address developing master plans
and programs of requirements,
tracking and updating cost and
schedule estimates, and maintaining
decisional documentation.
We will continue to develop
programs of requirements
documents per the requirements
listed in the EPA National Facilities
Manual, Volume 2 and ensure all
POR documents include an
overview of the project scope,
objectives, requirements,
performance criteria, facility
description and area requirements.
December 31,
2020
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We will ensure all POR documents
comply with the GAO cost
estimating and assessment guide.
OMS will update the current cost and
schedule tracking systems and the
current status of funds reporting
process to include tracking project
cost accounting and schedule updates
consistent with OMB 's Circular A-
123, as required. OMS will continue
to report and document consolidation
decisions in the agency's annual
Presidential budget submission and
the Federal Real Property Profile.
If you have any questions regarding this response, please contact Mitch Hauser, Audit Follow-up
Coordinator, of the Office of Resources and Business Operations, (202) 564-7636 or
hauser.mitchell@epa.gov.
Cc: Gloria Taylor Upshaw
Rashmi Bartlett
James Hatfield
Richard Eyermann
Nicole Pilate
Ashley Langer
Yvette Jackson
Alva Daniels
Lenee Morina
Jessy Branham
Dan Amon
Steve Blankenship
Ayesha Sayeed
Jason Bushta
Dan Coogan
Jan Jablonski
Monisha Harris
Marilyn Armstrong
Mitchell Hauser
Allison Thompson
Andrew LeBlanc
Nikki Wood
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Appendix C
Distribution
The Administrator
Assistant Deputy Administrator
Associate Deputy Administrator
Chief of Staff
Deputy Chief of Staff/Operations
Agency Follow-Up Official (the CFO)
Agency Follow-Up Coordinator
Assistant Administrator for Mission Support
Principal Deputy Assistant Administrator for Mission Support
General Counsel
Associate Administrator for Congressional and Intergovernmental Relations
Associate Administrator for Public Affairs
Associate Deputy Assistant Administrator for Mission Support
Director, Office of Continuous Improvement, Office of the Administrator
Director, Office of Resources and Business Operations, Office of Mission Support
Director, Office of Administration, Office of Mission Support
Audit Follow-Up Coordinator, Office of the Administrator
Audit Follow-Up Coordinator, Office of Mission Support
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