The U.S. Environmental Protection Agency Office of Inspector General in October issued a report identifying nearly $1 billion in questioned costs and funds that it suggested could be put to better use in the agency’s distribution of Bipartisan Infrastructure Law funding for lead service line replacement.
Due to a lack of internal controls that the EPA OIG initially flagged to EPA in a May 2024 management alert, the OIG said EPA used inaccurate and unverified data from Texas and Florida for its fiscal year 2023 allocations, resulting in nearly $344 million in questionable allotments. After the EPA OIG raised these concerns, the EPA revised its fiscal year 2024 allocation for Texas. However, the EPA continued to use unverified data to determine Florida’s fiscal year 2024 allocation, resulting in more than $200 million in additional questionable costs.
With Florida receiving the largest lead service line allotment in fiscal year 2023 and the second largest in fiscal year 2024, EPA OIG said continuing this flawed allocation method could result in more than $400 million of future funds that could be put to better use in states whose lead service line replacement needs are greater.
Despite the issues identified in the report, and the resulting questionable costs, the EPA OIG said the agency has rejected its recommendations, and the matter remains unresolved.
“Every lead service line dollar misallocated is a dollar taken away from states that rely on federal funding to assist communities at risk of lead-contaminated drinking water,” said EPA Inspector General Sean W. O’Donnell. “We have warned the EPA repeatedly about the real and significant consequences of using unreliable data. The Agency needs to fix these systemic flaws before more taxpayer dollars are misdirected.”
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The EPA OIG is the premier oversight agency in the environmental space, entrusted by Congress to oversee the EPA’s implementation of more than $60 billion in IIJA funding. In the last three years, the EPA OIG has conducted thousands of fraud awareness briefings to tens of thousands of people to raise awareness of potential indicators of fraud, waste, or abuse. The EPA OIG has also issued 25 BIL-related reports, identifying areas of potential improvement in IIJA programs or recommending courses of action. Thus far, the EPA OIG said its work has revealed roughly $1.052 billion in BIL funds that “could have been put to better use.”
Source: EPA OIG
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