WASHINGTON, DC – Sen. James Inhofe (R-Okla.), Chairman of the Environment & Public Works Committee, held a full committee hearing today to conduct an oversight of grants management within the U.S. Environmental Protection Agency (EPA). The committee received testimony from the EPA Inspector General’s office, the Unites States General Accounting Office (GAO), and Taxpayers for Common Sense regarding deficiencies in agency oversight of grantees. Historically, the EPA has awarded over $4 billion in grants each year for the past several fiscal years.

Inhofe made the following statement at the hearing:

“The EPA has an obligation to ensure taxpayers that it is accomplishing its mission with the funds it awards each year. However, for at least the last 10 years, the story of grants management is seemingly a revolving door of EPA IG audits and GAO reports, congressional hearings, and new EPA policies in response. Even with this constant cycle of criticism, hearings, and new policies; the GAO reported late last year that the EPA continues to demonstrate the same persistent problems in grants management. These problems include a general lack of oversight of grantees, a lack of oversight of agency personnel, a lack of any measurement of environmental results, and a lack of competition in awarding grants. It is imperative that agency personnel are accountable for monitoring grants and that measurable environmental results are clearly demonstrated.”

Testimony today pointed toward significant problems in the oversight of discretionary grants. Particularly troubling was an EPA Office of Inspector General (OIG) audit issued March 1, 2004, where a grantee – the Consumer Federation of America – received EPA grants from 1997 to 2003 totaling nearly $5 million. The OIG testified this morning that this ineligible lobbying organization performed work with grant funds, circumventing the procurement process by using a non-profit organization that could not demonstrate its own employees, space, or overhead expenses.

“Despite countless attempts by EPA to remedy the situation, its record over the past few years has not been encouraging,” Inhofe said. “There continues to be no requirement for demonstrating demonstrable environmental outcomes from EPA grants. Hundreds of millions of dollars continue to be doled out even though we are unable to know if the grants are doing anything to help human health or the environment.”

Inhofe sent a letter today to EPA Administrator Mike Leavitt requesting a list of all discretionary grant recipients for fiscal year 2002 along with particular information on each grant award to aid in the Committee’s continued oversight functions.

A full copy of the letter is attached.


March 3, 2004

Honorable Mike Leavitt Administrator U.S. Environmental Protection Agency 1200 Pennsylvania Ave, N.W. Washington, D.C. 20460

Dear Administrator Leavitt:

The Senate Environment and Public Works Committee received testimony today regarding the recent history of grants management at the Environmental Protection Agency. Representatives from the EPA Inspector General’s office and the U.S. General Accounting Office detailed both general and specific concerns with grants management and potential solutions at this hearing.

Particularly troubling was an EPA OIG audit issued March 1, 2004, which found that an “ineligible lobbying organization” received EPA grants from 1997 to 2003 totaling nearly $5 million.

EPA witness, David O’Connor, readily admitted that the EPA’s record for the past few years has not been particularly encouraging. We can appreciate the agency’s new policies for competition in awarding grants, oversight, and a five-year management plan. However, with GAO and the EPA OIG’s continuing skepticism concerning reform, we would like to request information from the agency. Testimony this morning revealed that discretionary grants have been particularly problematic because they are only one-quarter of grant awards, are awarded in lower amounts than non-discretionary grants, and are awarded with apparently little competition or demonstration of expected environmental outcomes. Accordingly we would like a listing of all discretionary grant recipients for fiscal year 2003. The following is a listing of particular information we would like on each grant award. We believe this information will be helpful to the Committee as it exercises its necessary oversight functions. We would like this information by the EPA budget hearing, March 10, 2004.

Requested information:

Organization Awarded Grant or Contract Title of Grant or contract Amount of Grant or contract for current/future fiscal year Was this an original grant or amendment or extension Amount of grants and contracts to this organization for the past two years (if any) Approving office within the department or agency Was this grant or contract published in the Federal Register Number of proposals considered before making this award Date grant or contract will begin and end Legislation authorizing this grant or contract What was the resulting product or work from the grant award Was this an Congressionally earmarked project or grant

We appreciate your cooperation with this request and look forward to working with you to meet our obligation of ensuring taxpayers that their money is being used to protect human health and the environment. Please respond to Ryan Jackson (majority) at (202) 224-3134 and Geoff Brown (minority) at (202) 224-5162.