PRO^
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON, D.C. 20460
February 3, 2023
OFFICE OF
LAND AND EMERGENCY
MANAGEMENT
MEMORANDUM
SUBJECT: Updates to the UST Prevention Assistance Guidance
FROM: Mark Barolo, Acting Director
Office of Underground Storage Tanks (OUST) BAROLO
UST/LUST Regional Program Managers, Regions I - X
MARK
Digitally signed by MARK
BAROLO
Date: 2023.02.03 11:19:46
-05'bO1
TO:
Attached is new program guidance that we have developed to assist the Regions in reviewing
underground storage tank (UST) assistance agreement proposals from states and tribes. This
guidance replaces grant guidance on this topic that was developed in 2008 and 2009 and addresses
many issues and questions we have received since that time. Notably this guidance updates the list
of allowable and unallowable activities in the UST prevention program, broken out by the funding
source. I encourage your Project Officers to review this guidance as needed.
This guidance can also be found on the UST website at https://www.epa.gov/ust/state-grant-
pol i cy-and-gui dance.
Please see the attached program guidance for more details. If you have any questions, please
contact me at (202) 564-1611 or Rich Canino at (202) 564-0394.
Attachment
cc: Jim Drummond, OGC
Kathy Nam, OGC
Dan Crystal, OLEM
Kari Bilal, OLEM
Tony Raia
Ray Worley
Richard Canino
Regional Liaisons
-------
EPA
»"" >»« >¦> -i .«
Program Guidance for Prevention Assistance
Agreements Awarded Under the Leaking
Underground Storage Tank (LUST) Trust Fund Program
U.S. Environmental Protection Agency
Office of Underground Storage Tanks
Washington, D.C.
www, epa. gov/ust
EPA-510-K-23-001
February 2023
-------
Table of Contents
List of Acronyms used in this document 4
Introduction 5
Purpose 5
Background And Legislative Information 5
Cooperative Agreements or Grants 6
Section 1: Allowable uses For STAG And LUST Prevention Money 7
General Information on Allowable Uses 7
Section 2: Grant Management and Accounting Information 8
Getting Started for New POs 8
Project or Site Codes 9
Delegation of Authority 9
Statutory Authority 10
Multiple Appropriations or Split Funding 11
Prohibition of LUST Prevention Grants in Performance Partnership Grants (PPGs) 12
Combining LUST Prevention Funding and SWDA § 2007 STAG Funding in the Same
Cooperative Agreement 12
Eligible Applicants and Requirements 12
Credentials Or Documentation 12
Project Duration 13
Section 3: Regulatory Requirements and Guidance 13
Project Requirements 13
Cost Sharing 13
Terms And Conditions Example 14
Reporting Requirements 14
State Reporting Requirements and Schedule 15
Environmental Results 15
Section 4: Policy Direction 15
Allocation And Distribution of Money 15
Funding Priorities 15
Workplan Guidance 15
Environmental Justice (EJ) Considerations 16
Section 5: Merit Review for Non-Competitive Grants 16
Merit Review 16
Attachment: Grant Merit Review Checklist
17
-------
List of Acronyms used in this document
AA
Assistant Administrator
CFDA
Catalog of Federal Domestic Assistance
CFR
Code of Federal Regulations
EPA
Environmental Protection Agency
EPAct
Energy Policy Act of 2005
FR
Funding Recommendation
LUST
Leaking Underground Storage Tank
MA
Multiple Appropriations
NPTCD
National Policy, Training and Compliance Division
NGGS
Next Generation Grant System
OGC
Office of General Counsel
OGD
Office of Grants and Debarment
OLEM
Office of Land and Emergency Management
OUST
Office of Underground Storage Tanks
PO
Project Officer
PPG
Performance Partnership Grants
RA
Regional Administrator
RCRA
Resource Conservation and Recovery Act
STAG
State and Tribal Assistance Grants
SWDA
Solid Waste Disposal Act
TCR
Technical Compliance Rate
UST
Underground Storage Tank
-------
Introduction
Purpose
EPA's Office of Underground Storage Tanks (OUST) developed this guidance to meet the
following objectives:
Establish a comprehensive resource for regional project officers (POs) to consult when
reviewing underground storage tank (UST) prevention assistance agreement proposals
from states and territories (hereafter referred to as states), tribes, and intertribal
consortia (hereafter referred to as tribes),
Update and consolidate the 2008 Office of Underground Storage Tanks Program
Guidance for Prevention Assistance Agreements Awarded Under the Leaking
Underground Storage Tank (LUST) Trust Fund Program and the 2009 Supplemental
Guidance,
Address questions and issues OUST staff have received from regional POs that were
not addressed in the above documents,
Provide a comprehensive list of allowable and unallowable activities under LUST
Prevention and state and tribal assistance grants (STAG) funding, and
Incorporate grant merit review requirements and accompanying checklist, as required
by updates to OMB 's 2 CFR 200 Uniform Grant Guidance, effective Nov 12, 2020.
This program guidance will assist Regional UST programs as they negotiate and approve state and
Tribal UST prevention assistance agreements and work with their Regional Grants Management
Offices to ensure timely award funding to states and tribes. Regions must negotiate and award
assistance agreements for these funds separate from the general LUST corrective action
cooperative agreements and must ensure that funds are tracked and accounted appropriately.
As part of an agreement with EPA's Office of Grants and Debarment (OGD) in establishing the 2
CFR §200.205 merit review process, OUST will review this guidance and the merit review process
at least once every five years for possible updates.
This guidance replaces and supersedes the 2008 Office of Underground Storage Tanks Program
Guidance for Prevention Assistance Agreements Awarded Under the Leaking Underground
Storage Tank (LUST) Trust Fund Program and the 2009 Supplemental Guidance.
Background And Legislative Information
The Superfu endments and Reauthorization Act of 1986 established the federal LUST Trust
Fund (LTF) to address actual or suspected releases from federally regulated USTs by amending
Subtitle I of the Solid Waste Disposal Act (SWDA), also known as the Resource Conservation and
Recovery Act (RCRA).1 The LTF is financed by a one tenth of one cent per gallon tax on gasoline,
diesel, and aviation fuels. All taxes are collected directly by the US Treasury Department and
place in an account that Congress can draw appropriations from. The tax is not permanent and
1 For consistency purposes, SWDA will henceforth be referred to as RCRA in this guidance.
-------
must be reauthorized periodically. This most recently happened in the Infrastructure Investment
and Jobs Act of 2021 (also known as the Bipartisan Infrastructure Law), extending the tax through
Oct 1, 2026.
The Energy Policy Act of 2005 (EPAct) expanded the authorized uses of the LTF2 to allow for
specific UST prevention activities outlined in RCRA § 9011.3 EPA interprets SWDA § 9011 in
combination with other leak prevention authorities provided by EPAct to authorize the use of LTF
for the following major activities:
Inspections and other enforcement activities,
Operator training,
Secondary containment support activities,
Delivery prohibitions, and
Public reporting requirements.
EPA's annual appropriation acts authorize financial assistance to tribes for developing and
implementing programs to manage USTs in Indian country as part of the RCRA § 9013 strategy
for addressing UST concerns on tribal lands.
Prior to passage of EPAct, Congress authorized and appropriated STAG funds for UST prevention
activities, as authorized by RCRA § 2007(f)(2). EPA continues to receive a small STAG
appropriation to fund UST prevention cooperative agreements to states for activities similar to
those authorized by RCRA § 9011, as well as any UST prevention activities not authorized by
§ 9011.
The language included annually in the STAG appropriation (reproduced below) for the RCRA §
2007(f)(2) program authorizes EPA to supplement grants awarded under LUST-funded RCRA §
9011 grants with STAG money appropriated for RCRA § 2007(f)(2) without regard to general
legal restrictions on using two appropriations for the same activities:
XXX shall be for grants to States under section 2007(f)(2) of the Solid Waste Disposal Act,
which shall be in addition to funds appropriated under the heading ' 'Leaking Underground
Storage Tank Trust Fund Program'' to carry out the provisions of the Solid Waste Disposal
Act specified in section 9508(c) of the Internal Revenue Code other than section 9003(h)
of the Solid Waste Disposal Act.
Additional information on the UST Prevention program's statutory authority may be found in the
Catalogue of Federal Domestic Assistance (CFDA) Listing //- 66,804 for the UST Prevention,
Detection, and Compliance Program.
Cooperative Agreements or Grants
EPA has discretion to award either grants or cooperative agreements to states and tribes for UST
prevention activities. The difference between a grant and a cooperative agreement is the degree
2 For clarity, funds allocated in the prevention are program are called LUST Prevention since they come from the LUST Trust Fund, although the
program itself is referred to as UST prevention.
3 OUST issued program guidance in Fiscal Year 2008, and supplemental guidance in 2009, to reflect the UST prevention funding made available
to underground storage tank prevention needs related to EPAct. This guidance document supersedes and replaces those documents.
-------
of EPA's involvement in the activities that a state or tribe will need to carry out with EPA financial
assistance. If EPA's involvement is substantial, a cooperative agreement is the appropriate funding
vehicle; if that involvement is not substantial, a grant is the appropriate vehicle. Section 7 of EPA
Order 5700.1, Policy for Distinguishing Between Assistance and Acquisition provides additional
guidance on determining whether to award a grant or a cooperative agreement.
EPA has determined that UST prevention assistance agreements funded with LUST Trust Fund
and/or STAG funding are to be issued as cooperative agreements.
Section 1: Allowable uses For STAG And LUST Prevention Money
General Information on Allowable Uses
The extent of allowable activities in the UST Prevention program depends largely on whether the
recipient is a tribe or state. More specifically,
Tribes may use LUST Prevention money broadly to support any actions necessary to
implement the UST prevention program, as highlighted in EPA's Strategy For An
EPA/Tribal Partnership I'c Implement Sectiu ^ s . ¦> m 1 be Energy Policy Act Of 2005.
States may use LUST Prevention money for activities that are reasonably necessary to carry
out the major prevention activities outlined in EPAct, described above.
States may use STAG money for all similar activities as LUST prevention money, as
allowed by language in EPA's annual appropriation acts.
In addition, states may use STAG money for additional state UST program and capacity-
building activities associated with their UST programs but not specifically identified in
EPAct.4
A more comprehensive description of the EPAct requirements states must meet can be found in
the UST Prevention guidelines listed below. All state requirement activities listed in these
guidelines are eligible for LUST prevention money, including:
Inspecting USTs (Section 1523 of EPAct).
Operator Training (Section 1524).
Public Record (Section 1526).
Delivery Prohibition (Section 1527).
Financial Responsibility and Installer Certification (Section 1530), and
Secondary Containment (Section 1530).
Table 1 below provides more specific examples of state activities that are and are not eligible for
LUST prevention and STAG money, based on both the EPAct and subsequent EPA policy
decisions. This list is not exhaustive; it represents the most common questions received on
eligibility of using LUST and/or STAG funding money.
4 The list of eligible STAG activities does not apply to GAP funding, which has its own set of allowable and eligible activities found in Guidance
on the Award and Management of General Assistance Agreements for Tribes and Intertribal Consortium.
-------
Table 1. Allowable Uses for STAG and LUST Prevention Money
Allowable activities using STAG and/or LUST Prevention Funding
UST compliance inspections, including training or oversight of inspectors.
Enforcement activities, including issuing administrative orders and bringing actions for UST
violations, including delivery prohibition.
Database management activities, including inputting data and developing a public facing website,
associated tracking, and enforcement related activities, and updating notification/registration forms.
Training and outreach to UST owners and operators about their EPAct regulatory requirements.
State program approval activities that are specifically related to EPAct regulatory requirements, such
as developing enforcement policy for inspections.
Performing state financial responsibility assurance and enforcement activities that fall under SWDA §
9004(f)(l)(A)(ii) or (iii).
Allowable activities using STAG Funding Only (Unallowable with LUST P money)
Activities not specifically related to EPAct requirements, such as developing regulations or
interpretations on the 2015 UST regulation, records maintenance of leak detection monitoring, tank
closure activities, financial responsibility activities, field constructed airport and hydrant systems
activities, or outreach or compliance assistance not related to EPAct.
Participation in equipment certification or materials approval activities.
Participation in a leak detection workgroup.
Participation in standards development activities.
Conducting UST compatibility activities.
Performing contractor certifications, such as installer, remover, tester, or repairers.
Performing activities related to the interim prohibition in SWDA § 9003(g).
Activities NOT Allowable with either LUST P or STAG funding
Working on permitting programs not directly linked to delivery prohibition.
Conducting LUST corrective actions that EPA can fund under SWDA § 9003(h)(7), such as site
investigation, assessment, or cleanup of a suspected or actual release.
Testing petroleum UST operation and maintenance equipment, (such as purchasing spill kits, the
replacement/repair of leaking tanks, UST installation, or UST removal and demolition activities).
Responding to petroleum releases from vehicle accidents.
Using funds to support state fund administrative costs or to help meet the state cost-share requirement.
Performing any UST testing activities.
Paying fines or penalties.
Performing general training activities for UST staff not related to their credentials.
Section 2: Grant Management and Accounting Information
Getting Started for New POs
This section provides information for new POs and those new to the UST Prevention cooperative
agreement process. Another useful resource for new POs to consult is the Grants Assistance
Agreement Almanac.
-------
The Next Generation Grants System (NGGS) is EPA's grants management system. All UST
Prevention cooperative agreements are both discretionary and non-competitive. There are
currently three CFDAs associated with the UST and LUST programs, but the only correct one to
use for Prevention cooperative agreements is #66.804 - Underground Storage la W
Prevention, Detection, and Compliance Program.5
See Table 2 below for details on what information should be included on a Commitment Notice.
1 "sihie 2 - liiloi iiiiKidii In include on jour ('ommilmcnl Notice
Line
Site
Name
Req
No
Fiscal
year
Approp.
Code
BO
code
PRC
Object
class
Amount
Site
project
Cost
Org
Code
I/D
Description
001
Name
Set
by
your
FCO
The
current
FY
F/LUST
and/or
E/STAG
Your
Region,
thenF
602DJ6
4187
The
requested
amount
See
below
Not
needed
Not
needed
Not needed
Project or Site Codes
There is a general rubric for funding commitment notices for LUST Prevention cooperative
agreements in NGGS. According to the Agency's Funds Control Manual. LUST Prevention
cooperative agreements require a seven-digit project or site code. The correct code may be entered
using the following rubric:
Characters 1 and 2 indicate the EPA Region, such as 01,
Characters 3, 4, and 5 should be entered as "00G," with the G signifying a state or tribal
cooperative agreement, and
Characters 6 and 7 should be entered as "AA," which indicates EPAct or LUST prevention
money.
There is no requirement for a project or site code for grants funded with STAG appropriations and
the program code is L.
Delegation of Authority
NGGS allows selection of three separate delegations in the same funding recommendation (FR)
via a dropdown menu, including:
1. H1 \ iMegation | in Un'-rovim- distance Agreements with Federally Recognized
hihesfct I'u" rams to Manage Hazardous Waste and Underground Storage Tanks and for
Leaking Underground Storage Tank Activities
2. EPA. Delegation 8-14 State Underground Storage Tank Financial Assistance Program and
5 The other two CFDAs include #66.805 - Leaking Underground Storage Tank Trust Fund Corrective Action Program, which is used for
cooperative agreements in the LUST state fund cleanup program. Separate grant guidance is available for LUST Corrective Action Cooperative
Agreements; and #66.816 - Headquarters and Regional Underground Storage Tanks Program, which is used for grants that either promote the
prevention, compliance, and identification of USTs or to support activities that promote corrective action, enforcement, and management of
releases from UST systems in Indian Country (depending on appropriation).
-------
State Program Submittals, which authorizes RAs to approve STAG funded financial
assistance agreements under SWDA 2007(f)(2). The RAs may, in turn, redelegate
authority to the Division Director level; and
3. EPA Delegation 8-38 Grants and Cooperative Agreements for Subtitle I. authorizes the
OLEM Assistant Administrator and RAs to take all necessary actions to approve LUST
funded prevention grants or cooperative agreements with states and tribes. The OLEM AA
may in turn, redelegate the authority to the OUST Office Director and the Regions may
redelegate to the Division Director level.
Statutory Authority
Table 3 below illustrates the correct, statutory authority, delegation of authority, and statutory
language to enter on the Funding Recommendation in the NGGS, depending on both the recipient
and the appropriation(s) used.
Table 3 -
Correct Statutory and Delegation of Authorities for LUST Prevention Cooperative Agreements to enter in
NGGS
Grantee
Funding
Source
Statutory
authority
(line A. 15)
Delegation of authority
(line A.16)
Statutory Language
State
STAG
SWDA §
2007
8-14 State Underground
Storage Tank Financial
Assistance Program and
State Proeram Submittals
[Appropriations are available] "to be used to make
grants to the states for purposes of assisting the states in
the development and implementation of approved State
underground storage tank and release detection,
prevention, and correction programs under subchapter
IX."
"Funds made available under section 6991m(2)(D) of
this title from the Trust Fund may be used to conduct
inspections, issue orders, or bring actions under this
subchapter
State
LUST
Prevention
SWDA §
9011
8-38 Grants and
Cooperative Agreements
(Subtitle I).
(1) by a State, in accordance with a grant or
cooperative agreement with the Administrator,
of State regulations pertaining to underground
storage tanks regulated under this subchapter;
and
(2) By the Administrator, for tanks regulated under
this subchapter (including under a State
program approved under section 6991(c) of this
title."
State
STAG &
LUST
Prevention
SWDA §
2007 and
§ 9011
8-14 and 8-38.
See two responses above.
-------
Grantee
Funding
Source
Statutory
authority
(line A. 15)
Delegation of authority
(line A.16)
Statutory Language
Tribe
LUST
Prevention
SWDA §
9013 and
the most
recent EPA
annual
appropriati
ons act
1-114 Arrorovins
Assistance Agreements
with Federally
Recosnized Tribes for
Prosrams to Manase
Hazardous Waste and
Undersround Storase
Tanks and for Leakins
Undersround Storase
Tank Activities.
Annual Appropriations (must be reauthorized and
updated every year)
"Provided, That the Administrator is authorized to use
appropriations made available under this heading to
implement section 9013 of the Solid Waste Disposal Act
to provide financial assistance to federally recognized
Indian tribes for the development and implementation of
programs to manage underground storage tanks.
Multiple Appropriations or Split Funding
POs may combine LUST Prevention and STAG funding allocated to a state into a single assistance
agreement. In so doing, regions must follow EPA's policy on "split funding" or multiple
appropriation grants, as specified in the EPA Order 5730.2, Multiple Appropriations Awards
Policy. and provide adequate justification, for example, combining two allocations minimizes the
administrative burden on the state.
POs must also develop a proportional charging allocation methodology for single assistance
agreements, and per the request of the Research Triangle Park Finance Center, include these
charging allocations in the FR to facilitate grant expenditures. States do not need to account for
LUST prevention and STAG money separately, but they must follow their existing procedures for
complying with the financial management and audit standards in 2 CFR Part 200.
As part of justifying a multiple appropriations grant, POs must include in the FR a description of
the methodology for charging payments that reflect the proportional benefit to each appropriation.
The allocation methodology should include the following:
Define what will be allocated. For example, grant funding for (insert scope of work
narrative),
Describe the allocation methodology, including the allocation statistic proposed to
distribute costs among subobjectives; the method used to derive the statistic; and the total
cost including the portion of the cost to be disbursed by the subobjective, and
Define the time-period for the methodology.
Sample Multiple Appropriation Award Grant Allocation Formula:
Table 4 below provides an example of a multiple award funding allocation:
Table 4 - Example Multiple Award Funding Allocation
Project or Description
Appropriation
Funding Request
Funding %
Conducting UST compliance
inspections, including training
and oversight of inspector.
E (STAG)
$150,000
10%
-------
Conducting UST compliance
inspections, including training
and oversight of inspector.
F (LUST prevention)
$1,500,000
90%
Total
$1,650,000
100%
Sample Purpose Statement for Multiple Appropriations Award:
The purpose of this project is to assist state USTprogram managers who implement leak detection,
prevention, and related enforcement to manage state USTs that measure results in support of the
mission-based goals of the national UST program.
Prohibition of LUST Prevention Grants in Performance Partnership Grants (PPGs)
Although grants may be combined with both LUST prevention and STAG appropriations, states
cannot combine these grants with a STAG-funded PPG. This is because the statute authorizing
PPGs requires that PPG funding come from the "categorical" STAG appropriation or that Congress
otherwise authorize including grant funds in a PPG. This restriction does not apply to grants
funded exclusively with STAG money.
Combining LUST Prevention Funding and SWDA § 2007 STAG Funding in the Same
Cooperative Agreement.
Although LUST Prevention cooperative agreements are prohibited for inclusion in PPGs, LUST
Prevention funds and STAG funds available for SWDA § 2007 grants may be combined in a single
grant under the Multiple Appropriations (MA) Award Policy. The Office of General Counsel
(OGC) has advised that appropriations for LUST prevention grants and SWDA § 2007 grants are
legally available for the same types of activities based on the language in EPA's annual
appropriation act. Other requirements of the MA Policy such as developing an allocation formula
for distributing charges between LUST prevention and SDWA § 2007 STAG apply.
In practice, many of the administrative efficiencies achieved under PPGs may be accomplished by
combining grants with LUST prevention and STAG appropriations. Decisions on PPG use are
typically made by the grantee, in consultation with the regional PO, as the grantee will realize the
administrative efficiencies.
Eligible Applicants and Requirements
These cooperative agreements or grants are only available to states or tribes meeting the
requirements as described in the Federal Register Vol. 67, No J I '< pp IM 183, Update to
EPA Policy on Certain Grants to Intertribal Consortia. LUST Prevention cooperative agreements
authorized by Section 2007(f) of the SWDA are only available to states. While tribes are
technically authorized to access STAG funds, EPA has made the policy determination that STAG
funds be limited to use for the states.
Credentials Or Documentation
-------
States must either submit certification indicating they meet the applicable Energy Policy Act
provisions, or submit documentation describing their efforts to meet the requirements, according
to EPA's Energy Policy Act grant guidelines. Regional offices maintain the credentials or
documentation for states' programs; tribes are not required to provide certification.
A state must complete this or a similar certification form and submit it to the region. The region
reviews this form and drafts a memo to OUST, indicating the state either meets the program
provisions or has an acceptable plan in place to help achieve compliance, for example, the 3-year
inspection cycle mandate. OUST reviews regional memos and state certifications, and when
agreeing with regional findings, releases grant money for the award.
Project Duration
The terms of the assistance agreement, including budget and project period duration are
determined at the time of the award by the specific EPA regional Grants Office in consultation
with the regional UST program.
Section 3: Regulatory Requirements and Guidance
The following regulations apply to all Prevention related cooperative agreements:
'art 200. the Uniform Grant Guidance, government-wide policies and procedures
for the award and administration of grants,
. ^ " i ju I ->00, a subset of the Uniform Grant Guidance that includes EPA-specific grant
requirements, and
40 CFR Part 35. that includes policies and procedures for providing assistance agreements
through state and tribal grants appropriated under STAG.
Project Requirements
States must agree to comply with guidelines EPA issued to implement Title XV, Subtitle B of
EPAct as a term and condition of receiving UST prevention grants. See the grant guidelines on
EPA's Emet icy Act of 2005 and Underground Storage Tanks web page for specific
guidelines about each relevant section, such as requirements on delivery prohibition, inspecting
USTs, operator training, of EPAct. These guidelines do not apply to tribal LUST Prevention
cooperative assistance agreements.
Cost Sharing
When receiving an assistance agreement awarded under SWDA § 9011 and other applicable
provisions of Subtitle I of SWDA, states will, per EPA policy, provide a 25 percent cost share.
The cost share is based on total project costs. The cost share is consistent with the cost share
requirement in 40 CFR § 35.335 for release prevention and detection grants funded with STAG
appropriations under Section 2007(f)(2) of the SWDA. States may meet the cost share requirement
by any means authorized by the cost share provision of 2 CFR § 200.306.
If states ask for documentation of the cost share requirement, regions may provide states a copy of
-------
the revised version of Assistance Listing 66.804. In addition, OLEM provided notice of the cost
sharing requirement in Federal Register Vol. 73, I 16674 16675, State Cost Share
Requirement for Leaking Underground Storage Tank (LUST) Prevention Assistance Agreement
and Authority ; nde LUST Prevention Assistance Agreements to Tribes. When a state
receives a combined LUST prevention and STAG grant, the 25 percent cost share is based on total
proj ect costs under the combined grant. States need not track their expenditures for cost sharing
separately for LUST activities and STAG activities.
Consistent with 40 CFR §35.735, there is no cost share requirement for UST Prevention
cooperative agreements for tribes awarded pursuant to annual appropriation acts. OUST decided
not to require a tribal cost share, as there is no such requirement described in the SWDA or the
annual appropriation acts.
For states, EPA may make exceptions to the 40 CFR § 35.335. State And Local Assistance,
Maximum Federal Share for STAG agreements to waive or reduce the 25 percent match or cost
sharing requirement. The state cost share provision in 40 CFR § 35.335 is not based on a statutory
requirement contained in the applicable grant making authority, § 2007(f)(2) of the Solid Waste
Disposal Act. If states request a waiver or reduction of the 25 percent cost share requirement for
STAG funded SWDA § 2007(f)(2) assistance agreements, regional offices will need to formally
request a waiver to 40 CFR § 35.335 from the Director of OGD's National Policy, Training and
Compliance Division (NPTCD) from the provision of EPA's grant regulations as provided in 2
CFR 1500.4. See NPTCD7s deviation or waiver procedures.
Similarly, although the 25 percent cost share for UST Prevention cooperative assistance
agreements is not covered by 40 CFR §35.335, any Region requesting a waiver from the policy-
based cost share requirement for LUST prevention assistance agreements must follow the same
procedures used for waivers under 2 CFR § 1500.4. Regions can request waivers from OGD's
Director, National Policy, Training and Compliance Division.
Terms And Conditions Example
In the terms and conditions section of a grant award, regions must include a term and condition
that the state grantee complies with provisions of the Energy Policy Act for all their UST grants.
The following is a sample term and condition:
"The recipient understands it is subject to requirements described in current EPA
guidelines implementing Subtitle B, Underground Storage Tank Compliance Act, of Title
XV of the Energy Policy Act, that are effective as of the date of this award or funded
amendment."
Reporting Requirements
Reporting requirements are identified at 2 CFR § 200.329. POs may include additional
information regarding the content and frequency of reporting requirements in the terms and
conditions of the assistance agreements, provided the frequency of reporting is consistent with
regulatory limits.
-------
State Reporting Requirements and Schedule
State reporting requirements and schedule for UST prevention assistance agreements are identified
in the National Program Guidance and in the semiannual report of UST performance measures.
Environmental Results
Regions must negotiate grant-specific performance measures with each state or tribe. These
measures are tailored for each state or tribe, and eligibility requirements are based on funding type.
Negotiations occur once a grantee submits a draft workplan for regional review and prior to formal
submission in www.grants.gov. Refer to the National Program Guidance for OLEM (updated
annually) for national performance measures for LUST prevention activities. Specific national
LUST prevention environmental results include the UST technical compliance rate (TCR).
Section 4: Policy Direction
Allocation And Distribution of Money
LUST Prevention and STAG appropriations are distributed to the Regions using an allocation
formula OUST developed, as required by Congress. This formula calculates the amount of
financial need by establishing a base amount for each state and then considering the number of
federally regulated USTs in each state. States may make requests to Regions for a certain amount
of money to come from STAG, as this money may be more widely used to support prevention
related activities not specifically outlined in the Energy Policy Act. Regional offices are
empowered to make the final determination on the actual amounts each state and tribe should
receive. Funding for tribes is not included in the formula. However, funds are distributed to the
tribes based on needs identified by the Regions and informed by the national tribal funding panel.
Funding Priorities
LUST Prevention program funding is used to provide resources to states and tribes for their UST
programs. Specific examples of funded projects include: inspections, enforcement, developing
leak prevention regulations, and other program infrastructure. Regions should give priority to
funding inspections in states that are out of compliance with EPAct requirements and to assisting
states with adopting measures, for example, delivery prohibition, secondary containment, operator
training, as required by EPAct and EPA's grant guidelines.
Workplan Guidance
As part of the Office of Management and Budget's updates to 2 CFR Part 200 Uniform Grant
Guidance, we added this section to provide guidance on what should be included in a prevention
assistance grant workplan. However, oversight of grant workplans is a regional responsibility and
there is no expectation OUST will review workplans.
States and tribes must submit applications for LUST prevention or STAG grants, and they must
include budgets and workplans. The budget should include a breakdown of associated costs of
each planned activity and output. The workplan should include a proposed schedule for each
-------
activity, specifying target dates and milestones for timely project completion. EPA's regional
grants office determines the scope of work of each prevention grant at the time of the award.
Environmental Justice (EJ) Considerations
In implementing Executr ier 13985 - On Advancing Racial Equity and Support, for
Under served Communities Through the Federal Government, OUST is encouraging a stronger EJ
component in all state and tribal grants. Per the I1ST Program's EJ Implementation Guidance,
shared by OUST Acting Office Director Mark Barolo on March 25, 2022, there are several
activities that the Regions should pursue with state and tribal partners in their cooperative
assistance agreements, such as:
Working with states to identify EJ activities that the states can implement,
Memorializing agreed-upon activities in work plans for state grants. This may include a
listing of specific activities or a more general "develop a set of actions" depending on the
timing of the grant negotiations and how much prior work the state has done to incorporate
EJ concerns,
Analyzing the UST universe using environmental justice criteria and supplementing with
other data elements of interest to the state to inform future actions,
Providing additional compliance assistance to facilities in areas with EJ concerns, and
Targeting inspection and enforcement efforts at facilities in areas with EJ concerns.
Section 5: Merit Review for Non-Competitive Grants
Merit Review
In August 2020, the Office of Management and Budget announced changes to the Uniform Grant
Guidance at 2 CFR Part 200. The most substantiative change to the grant rules was the requirement
for all Agency non-competitive grants to establish a formal merit review process.
This requirement necessitates the regional project officer to certify that the grant meets program
objectives, and that the grantee can meet requirements of the workplan, given their past
performance. It requires that the merit review process and checklist be reviewed periodically,
which OUST will conduct at least every five years.
The checklist in Appendix 1 is effective as of November 13, 2020, and applies to all new grants
awarded after that date. It does not apply to supplemental grants where work has not changed and
there are no performance issues with the grantee, nor to any incremental funding amendments.
This checklist should be added to Section M of the FR in NGGS.
-------
Attachment 1: Grant Merit Review Checklist
Merit Review Checklist For Applications For New Awards And Supplemental
Amendments STAG UST Categorial And LUST Prevention Grants (Federal Assistance
Listing # 66.804)
Note: OGD approved this version on March 19, 2021.
Review of Grant #
Review conducted by (Name and title e.g project officer)
Review conducted on (Date)
This checklist was developed to comply with the merit review requirements for non-competitive
grant applications under 2 CFR 200/Uniform Grant Guidance. It was developed for use by
Regional project officers to complete before submitting their funding request to the Regional grant
office. Effective as of November 12, 2020, this checklist will be necessary for all new awards, as
well as for supplemental amendments where the work is significantly different from the underlying
grant and depending on how the grantee has been performing under the grant. It is not required
for incremental or unfunded amendments to the grant.
This checklist and the STAG UST categorial and LUST Prevention grant merit review process
will be reviewed by the UST program manager on at least a five year cycle, in compliance with
the periodic review requirements under 00.205.
For grants funded with both STAG and LUST Prevention Funding, Project Officers are to use the
criteria for both funding sources when analyzing the merits of the application.
Section 1 describes the determination on whether a merit review is needed for an application for a
supplemental amendment. If the answer to both questions is no, you do not need to do a merit
review for the application. If the answer to either question is yes, then a merit review based on
this checklist is required for the application.
Sections 2-4 establishes the process for conducting merit review and is needed for all new awards,
and supplemental amendments based on the section 1 analysis.
Section #1 - Supplemental Funding Applications Merit Review Determination
1. Are the activities to be performed under the supplemental funding
application significantly different from the activities in the underlying
grant?
YES NO
2. Have there been any significant issues with the grantee's performance
and reporting so far under the grant that there are concerns whether the
grantee can successfully achieve the program objectives. This includes
not meeting the 3-year EPAct inspection cycle and not having a plan for
coming back into compliance.
YES NO
-------
If you have answered no to both questions, sign and date the form and your review is complete. If
you answered yes to either of these questions, please continue to section #2.
Section #2 - New Merit Review Process
3. Does the grantee's application meet the following criteria:
a. STAG grants only - For STAG grants funded under RCRA § 2007,
the proposed workplan complies with the workplan requirements
outlined in SO i ) k ' ^ 10 , and the feasibility requirements listed in
40 CFR 35.111. namely that the grant is feasible "given the
applicant's existing circumstances, past performance, program
authority, organization, resources, and procedures."
b. LUST prevention grants only - For LUST grants funded under
RCRA § 9011, the proposed workplan is feasible given the
applicant's existing circumstances, past performance, program
authority, organization, resources, and procedures.
c. The grantee's workplan complies with the allowable activities
authorized by SWDA § 9003(i), 9003(j), 9005(c), 9010, 9011, and
9012, and as outlined on page 6 of the Office of Underground
Storage Tanks (OUST) Program Guidan 8 Prevention
Funding for Assistance Agreements Awarded under the Leaking
Underground Storage Tank (LUST) Trust Fund Program (May '08).
a) YES NO N/A
b) YES NO N/A
c) YES NO
Section #3 - Factors in Considering the Grant Amount
4. Notwithstanding that the applicant's annual allocation allotment is
determined by OUST's LUST prevention allocation formula, does the
workplan justify this year's funding amount as originally requested?
YES NO
5. If the originally requested amount is not justified, have you worked with
the grant applicant to resolve these issues and requested modifications to
their workplan that ensures a successful grant?
YES NO N/A
Section #4 - Grant compliance with LUST program objectives
6. The objective of the LUST Prevention program, as listed in Assistance
Listing 66.804, is to assist states, Territories, Tribes, and Intertribal
consortia in developing and implementing UST programs for leak
prevention, compliance, and other activities authorized by the Energy
Policy Act of 2005. Does the proposed workplan help achieve these
program objectives?
YES NO
7. If yes, please provide a brief description of how the grantee is likely to
be successful in achieving program objectives.
------- |