U.S. ENVIRONMENTAL PROTECTION AGENCY 

OFFICE OF INSPECTOR GENERAL 

Catalyst for Improving the Environment 

Cancellation Memorandum 

EPA Maximized Competition for 

Recovery Act Grants under the 

National Clean Diesel Funding 

Assistance Program 

 Report No. 10-R-0082 

 March 23, 2010 
 

 

U.S. Environmental Protection Agency 10-R-0082 

March 23, 2010 Office of Inspector General 

At a Glance 

Catalyst for Improving the Environment 

Why We Did This Review 

The Office of the Inspector 

General (OIG) sought to 

determine whether the 

competition process that the 

U.S. Environmental Protection 

Agency (EPA) used to award 

American Recovery and 

Reinvestment Act of 2009 

(ARRA) grants under the 

National Clean Diesel 

Funding Assistance Program 

(1) promoted competition to 

the maximum extent possible, 

and (2) met ARRA goals and 

requirements. 

Background 

The President signed ARRA 

to create and save jobs, jump 

start the economy, and build 

the foundation for long-term 

growth. One of six EPA 

programs that ARRA funded 

was the Diesel Emission 

Reduction Act Program. That 

program, which received 

$300 million, includes the 

National Clean Diesel 

Funding Assistance Program. 

For further information, 

contact our Office of 

Congressional, Public Affairs 

and Management at 

(202) 566-2391. 

To view the full report, 

click on the following link: 

www.epa.gov/oig/reports/2010/ 

20100323-10-R-0082.pdf 

EPA Maximized Competition for Recovery Act 

Grants under the National Clean Diesel 

Funding Assistance Program

 What We Found 

We determined that EPA promoted competition to the maximum extent possible 

for the National Clean Diesel Emission Funding Assistance Program. EPA 

achieved three important goals in promoting competition: 

•	 EPA’s competition process was fair and impartial. 

•	 All applicants were evaluated only on the criteria stated in the 

announcement. 

•	 EPA made an effort to mitigate the risk of any applicant receiving an 

unfair competitive advantage. 

We noted that EPA received a significant increase in the number of applicants and 

proposals for ARRA National Clean Diesel Funding Assistance Program grant 

awards over the 2008 competition. 

We also determined that EPA set up a structure to meet the ARRA goals and 

requirements, namely the creation or retention of jobs. EPA designed the Request 

for Applications to make it difficult for applicants to disregard the ARRA criteria 

and still receive an award. EPA’s evaluation forms to grade applications allotted 

25 percent of the total score to ARRA-specific funding priorities. 

As we conducted our work, we noted EPA activities that could be considered as 

best practices. EPA issued a national Request for Applications and universal 

guidance for reviewers and selection officials, collected questions and provided 

answers universally, and conducted and coordinated outreach efforts with EPA 

partners. The national Request for Applications and guidance helped facilitate 

consistency among regional grant selection processes. Once the Request for 

Applications was issued, EPA Headquarters collected all of the questions that 

potential applicants submitted and provided answers that were accessible to all 

potential applicants (either online or via webinars). Also, EPA conducted 

extensive outreach in informing potential applicants of the competition, taking 

advantage of existing contacts, and establishing new ones. 

Because we determined that EPA is sufficiently promoting competition for ARRA 

grants under the National Clean Diesel Funding Assistance Program, we are 

closing this subject assignment upon issuing this memorandum report. 
 

 

 

 

 

UNITED STATES ENVIRONMENTAL PROTECTION AGENCY 

WASHINGTON, D.C. 20460 

OFFICE OF 

INSPECTOR GENERAL 

March 23, 2010 

MEMORANDUM 

SUBJECT:	 EPA Maximized Competition for Recovery Act Grants under the 

National Clean Diesel Funding Assistance Program 

 Report No. 10-R-0082 

FROM:	 Melissa M. Heist 

Assistant Inspector General for Audit 

TO: Gina McCarthy 

 Assistant Administrator 

Office of Air and Radiation 

 Craig E. Hooks 

 Assistant Administrator 

 Office of Administration and Resources Management 

 Al Armendariz 

 Regional Administrator, Region 6 

We determined that the U.S. Environmental Protection Agency (EPA) promoted competition to 

the maximum extent possible for grants awarded under the National Clean Diesel Funding 

Assistance Program and set up a structure to meet the goals and requirements for the American 

Recovery and Reinvestment Act of 2009 (ARRA). Therefore, we will close this subject 

assignment upon issuing this memorandum report. 

In September 2009, we initiated preliminary research for this assignment. Our objectives for this 

review of ARRA grants awarded under the National Clean Diesel Funding Assistance Program 

were to determine: 

1. Did EPA promote competition to the maximum extent possible? 

2. Did the competitions meet the goals and requirements of ARRA? 

To answer our objectives, we interviewed personnel at EPA Headquarters within the Office of 

Air and Radiation, including the Office of Transportation and Air Quality, and the Office of 

Grants and Debarment. The majority of our work was concentrated in Region 6, where we 

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10-R-0082 

interviewed personnel within the Air Program, reviewed the successful grant proposals, and 

analyzed reviewer evaluation forms. We focused our work on the National Clean Diesel 

Funding Assistance Program, which is part of the Diesel Emission Reduction Act Program. We 

examined relevant ARRA criteria such as EPA’s ARRA Diesel Emission Reduction Act 

Program Plan. We also reviewed EPA’s actions and efforts to maximize the ARRA National 

Clean Diesel Funding Assistance Program competition and EPA’s actions to ensure that the 

competition met ARRA goals and requirements. We did not compare the grant proposals to the 

corresponding evaluation scores to determine the appropriateness of those scores. 

We conducted our preliminary research from September 2009 to January 2010 in accordance 

with generally accepted government auditing standards. Those standards require that we plan 

and perform the audit to obtain sufficient, appropriate evidence to provide a reasonable basis for 

our findings and conclusions based on our audit objectives. We believe that the evidence 

obtained provides a reasonable basis for our findings and conclusions based on our audit 

objectives. Since our preliminary research did not identify significant concerns about the 

competition process to justify continuing into field work, we did not develop or report on all 

elements of findings as required by government auditing standards. We are reporting what we 

found and provide suggestions for other programs to consider in implementing similar programs. 

For the first objective, we determined that EPA promoted competition to the maximum extent 

possible. We found that EPA achieved three important goals in promoting competition: 

•	 EPA’s competition process was fair and impartial. 

•	 All applicants were evaluated only on the criteria stated in the announcement. 

•	 EPA made an effort to mitigate the risk of any applicant receiving an unfair competitive 

advantage. 

We also noted that EPA received a significant increase in the number of applicants and proposals 

for ARRA grant awards over the 2008 competition. EPA received roughly two-and-a-half times 

as many applicants for the ARRA grant cycle than it did for the 2008 grant cycle. 

For the second objective, we determined that EPA set up a structure to meet the ARRA goals and 

requirements, namely the creation or retention of jobs. EPA designed the Request for 

Applications to make it difficult for applicants to disregard the ARRA criteria and still receive an 

award. The evaluation forms that EPA developed to grade applications allotted 25 percent of the 

total score to ARRA-specific funding priorities. We found that for those projects funded in EPA 

Region 6, the criteria scores that directly addressed ARRA funding priorities averaged 

22.6 points out of the possible 25. 

As we conducted this work, we noted some EPA activities that could be considered as best 

practices. EPA issued a national Request for Applications and universal guidance for reviewers 

and selection officials, collected questions and provided answers universally, and conducted and 

coordinated outreach efforts with EPA partners. The national Request for Applications and 

guidance helped facilitate consistency among regional grant selection processes. Once the 

Request for Applications was issued, EPA Headquarters collected all of the questions that 

potential applicants submitted and provided answers that were accessible to all potential 

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10-R-0082 

applicants (either online or via webinars). Also, EPA conducted extensive outreach in informing 

potential applicants of the competition, taking advantage of existing contacts, and establishing 

new ones. Region 6 personnel told us they used the mailing list generated through the Blue 

Skyways Collaborative to notify potential applicants and conducted a joint webinar with Region 

7. Personnel at Headquarters told us that they coordinated with tribes, congressional 

representatives, the Environmental Council of the States, the Diesel Technology Forum, and 

other stakeholders. 

EPA’s Grants Competition Advocate informed us that his office will be reviewing other EPA 

competitions during 2010. Based on our preliminary research, we suggest that the Competition 

Advocate include an analysis of reviewer evaluations forms. We found that, in some cases, the 

narratives that reviewers entered to support their scores provided only limited information. 

The estimated cost of this report – calculated by multiplying the project’s staff days by the 

applicable daily full cost billing rates in effect at the time – is $204,872. 

If you or your staff have any questions regarding this cancellation memo, please do not hesitate 

to contact me at (202) 566-0899 or heist.melissa@epa.gov; or Janet Kasper, Director of 

Contracts and Assistance Agreement Audits, at (312) 886-3059 or kasper.janet@epa.gov. 

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Appendix A 

Distribution 

Office of the Administrator 

Assistant Administrator for Administration and Resources Management 

Assistant Administrator for Air and Radiation 

Regional Administrator, Region 6 

Principal Deputy Assistant Administrator for Administration and Resources Management 

General Counsel 

Agency Follow-up Official (the CFO) 

Agency Follow-up Coordinator 

Associate Administrator for Congressional and Intergovernmental Relations 

Associate Administrator for Public Affairs 

Director, Office of Transportation and Air Quality, Office of Air and Radiation 

Director, Office of Grants and Debarment, Office of Administration and Resources Management 

Senior Associate Director for Grants Competition, Office of Administration and Resources 

 Management 

Audit Follow-up Coordinator, Office of Administration and Resources Management 

Audit Follow-up Coordinator, Office of Grants and Debarment 

Audit Follow-up Coordinator, Office of Air and Radiation 

Audit Follow-up Coordinator, Region 6 

Acting Inspector General 

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