IG-00-030

AUDIT

REPORT COMPLIANCE WITH THE NATIONAL

ENVIRONMENTAL POLICY ACT

March 31, 2000

National Aeronautics and

Space Administration

OFFICE OF INSPECTOR GENERAL
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Acronyms

CFR Code of Federal Regulations

FAR Federal Acquisition Regulation

NEPA National Environmental Policy Act

NPG NASA Procedures and Guidelines

OIG Office of Inspector General

R&D Research and Development
W March 31, 2000

TO: A/Administrator

FROM: W/Inspector General

SUBJECT: INFORMATION: Compliance With the National Environmental Policy Act

 Report Number IG-00-030

The NASA Office of Inspector General (OIG) has completed an audit of Compliance with the National

Environmental Policy Act of 1969 (NEPA).1 We found that 11 (85 percent) of 13 mission-related

programs and projects2 (programs/projects) reviewed did not consider environmental impacts as

required by NEPA and NASA guidance. All nine of the reviewed construction of facilities projects3

considered environmental impacts as required by NEPA. We also found that NASA’s environmental

planning, oversight, guidance, and training related to NEPA compliance were inadequate.

Consequently, mission-related programs/projects totaling about $3 billion were potentially exposed to

increased costs, project delays, missed opportunities for preferable alternatives and/or public

involvement, and adverse public perception and reaction. Also, because of the potential impact of

NEPA noncompliance, we believe that NASA should report NEPA noncompliance for mission-related

programs/projects to the Internal Control Council as a potential material management control weakness4

to be included in NASA's

 

1

 The intent of NEPA is to protect the environment by requiring Federal agencies to gather information about the

environmental consequences of proposed actions (see the Note), assess the environmental impacts of those actions,

and consider alternatives that avoid or reduce adverse environmental impact. A key part of NEPA is keeping the

public informed. (Note: Actions are new and continuing activities, including programs and projects; new or revised

agency rules, regulations, plans, policies, or procedures; and legislative proposals. Major Federal actions are

potentially subject to Federal control and responsibility.)

**Deliberative process information omitted.**
2

annual Federal Manager’s Financial Integrity Act statement of assurance. We plan to perform a followup audit to ensure action is sufficient to provide reasonable assurance of NEPA compliance

Background

NASA is responsible for evaluating in the early planning stages the environmental impacts of proposed

programs/projects. Sound management controls over program/project formulation and implementation

processes are needed to ensure that environmental impacts are appropriately considered and NEPA

requirements are met. To ensure compliance with the NEPA, NASA established a multiple-step NEPA

process. The process starts with an environmental evaluation of each program/project proposal to

assess potential environmental impacts. If NASA determines that the proposed program/project falls

into a category that does not have a significant environmental impact, then NASA must prepare a

record of environmental consideration to document the determination. However, if the environmental

evaluation determines that significant environmental impacts may exist, then NASA must prepare an

environmental assessment5 and/or an environmental impact statement.

Recommendations

NASA management should report NEPA noncompliance for mission-related programs/projects as a

potential material control weakness and improve controls over environmental management for NASA’s

mission-related activities. Specifically, NASA should revise internal guidance, ensure environmental

management planning is performed, improve oversight of NEPA compliance during program/project

formulation, and educate employees in the specific NEPA requirements.

Management Response and OIG Evaluation

Overall, management stated that the audit report exaggerates the nature and scope of NEPA violations

for the 13 programs/projects reviewed, although management agreed that a number of deficiencies

existed. Management agreed, that training, guidance, and managerial controls related to NEPA are

inadequate to ensure NEPA compliance for existing and future programs/projects.

Management’s planned corrective actions for greater Program Management Council oversight,

increased environmental coverage in program/project management guidance, revisions to NASA's

NEPA and facilities guidance, and increased NEPA training are responsive to our recommendations.

However, management’s responses to recommendations for reporting NEPA noncompliance as a

potential material management control weakness, requiring environmental management planning, and

bringing existing programs/projects into NEPA compliance are nonresponsive. We maintain that

because Agency managers were not aware of and, therefore, had not considered NEPA requirements

at a program/project’s earliest planning phase, our finding accurately portrays the extent of

noncompliance . This is the case even if in hindsight, environmental impacts may be of a limited nature.

 

5An environmental assessment is a concise public document that includes a brief discussion of the need for the

proposal, alternatives to the proposal, and the environmental impacts of the proposed action and alternatives.
3

Although management agrees with our position that environmental considerations need to be factored

into the overall program/project plan, management did not agree to modify governing NASA policy

guidance. We have requested that management reconsider its position on recommendations to (1)

report NEPA noncompliance as a potential material management control weakness until training,

guidance, and management controls are in place; (2) require environmental management planning; and

(3) bring existing programs/projects into NEPA compliance.

Details on the status of the recommendations are in the finding section of the report.

[Original signed by]

Roberta L. Gross

Enclosure

 Final Report on Audit of Compliance with the National Environmental Policy Act
FINAL REPORT

AUDIT OF COMPLIANCE WITH

THE NATIONAL ENVIRONMENTAL POLICY ACT
W March 31, 2000

TO: J/Associate Administrator for Management Systems

FROM: W/Assistant Inspector General for Auditing

SUBJECT: Final Report on the Audit of Compliance with the National

Environmental Policy Act Redacted Report*

Assignment Number A9902100

Report Number IG-00-030

The subject final report is provided for your use and comments. Please refer to the Executive

Summary for the overall audit results. Our evaluation of your response is incorporated into the

body of the report. We consider management’s proposed, corrective actions responsive for

recommendations 3 through 7 and 9. We request that management reconsider its position on

recommendations 1, 2, and 8 and provide additional comments by May 1, 2000 Management's

actions are sufficient to close recommendation 6 for reporting purposes. All other recommendations

will remain open for reporting purposes until agreed-to corrective actions are completed. Please

notify us when action has been completed on the recommendations, including the extent of testing

performed to ensure corrective actions are effective.

If you have questions concerning the report, please contact Mr. Chester Sipsock, Program

Director, Environmental and Financial Management Audits, at (216) 433-8960, or Mr. James

Richards, Auditor-in-Charge, at (321) 867-4841. We appreciate the courtesies extended to the

audit staff. The final report distribution is in Appendix H.

[Original signed by]

Russell A. Rau

Enclosure
2

cc:

B/Chief Financial Officer

B/Comptroller

G/General Counsel

JE/Director, Environmental Management Division

JM/Director, Management Assessment Division

GRC/0100/Director, John H. Glenn Research Center at Lewis Field

KSC/AA/Director, John F. Kennedy Space Center

MSFC/DA01/Director, George C. Marshall Space Flight Center
3

bcc:

AIGA, IG, Reading Chrons

GRC/0200/Audit Liaison Representative

GRC/0540/Chief, Environmental Management Office

KSC/HM-E/Audit Liaison Representative

KSC/JJ-D/Chief, Environmental Program Office

MSFC/AD10/Manager, Environmental Engineering Department

MSFC/BJ01/Audit Liaison Representative
Contents

Executive Summary, i

Introduction, 1

Finding and Recommendations, 2

NEPA Compliance for Programs and Projects, 2

Appendix A – Objectives, Scope, and Methodology, 18

Appendix B – NASA’s NEPA Process, 21

Appendix C – Glossary, 22

Appendix D – Laws and Regulations, 25

Appendix E – Programs and Projects Reviewed, 30

Appendix F – Management’s Response, 31

Appendix G – OIG Comments on Management’s Response, 43

Appendix H – Report Distribution, 45
NASA Office of Inspector General

IG-00-030 March 31, 2000

 A9902100

Compliance with the National Environmental Policy Act

Executive Summary

Background. The National Environmental Policy Act of 1969 (NEPA), one of the first major

Federal environmental laws enacted in the United States, is the national charter that established

environmental goals and policies for the protection, maintenance, and enhancement of the

environment. NEPA mandates that all Federal agencies consider the effects of their actions6 on

the environment as early as possible and requires Federal agencies (1) to gather information

about the environmental consequences of proposed actions, (2) consider the environmental

impacts of those actions to assist in making environmental decisions, (3) consider alternatives

that avoid or reduce adverse environmental impact, and (4) keep the public informed. In short,

NEPA requires Federal agencies to examine and disclose the potential environmental impact of

proposed actions before commencing those actions.

NASA is responsible for evaluating in the early planning stages the environmental impacts of

proposed programs and projects (programs/projects). The NEPA requirements necessitate

implementation of sound management controls over program/project formulation and

implementation processes to ensure that environmental impacts are appropriately considered

and NEPA requirements are met. To ensure compliance with the NEPA, NASA established

the multiple-step process shown in Appendix B. The process starts with an environmental

evaluation of each program/project proposal to assess potential environmental impacts. If

NASA determines that the proposed program/project falls into a category that does not have a

significant environmental impact, then NASA must prepare a record of environmental

consideration to document the determination. However, if the environmental evaluation

determines that significant environmental impacts may exist, then NASA must prepare an

environmental assessment7 and/or an environmental impact statement.

A glossary defining terms used in this report is in Appendix C.

 

*We have redacted portions of this report due to references to deliberative process information. The

redacted passages do not affect the validity of this report or management's response.

6Actions are new and continuing activities, including programs and projects; new or revised agency rules,

regulations, plans, policies, or procedures; and legislative proposals. Major Federal actions are potentially

subject to Federal control and responsibility.

7An environmental assessment is a concise public document that includes a brief discussion of the need for

the proposal, alternatives to the proposal, and the environmental impacts of the proposed action and

alternatives.
ii

Objectives. The overall objective of the audit was to determine whether NASA guidance

ensures compliance with NEPA. The specific objectives were to assess whether NASA

guidance fulfills NEPA requirements and whether managers evaluated programs/projects in

compliance with NEPA and NASA guidance. The objectives, scope, and methodology are

described further in Appendix A.

Results of Audit. Eleven (85 percent) of 13 mission-related programs/projects8 reviewed did

not consider environmental impacts as required by NEPA and NASA guidance. All nine of the

reviewed construction of facilities projects9 considered environmental impacts as required by

NEPA; however, two did not fully comply with NASA draft guidance for implementing NEPA.

We also found NASA’s environmental planning, oversight, guidance, and training to be

inadequate. Consequently, programs/projects valued at about $3 billion were potentially

exposed to increased costs, project delays, missed opportunities for preferable alternatives

and/or public involvement, and adverse public perception and reaction. Due to the extent of

NEPA noncompliance for mission-related programs/projects, we consider this deficiency to be

a potential material control weakness10 reportable in accordance with NASA Procedures and

Guidelines (NPG) 1200.1, “Management Accountability and Control, Audit Liaison, and Audit

Followup,” dated January 23, 1997.

Recommendations. NASA management should report NEPA noncompliance for missionrelated programs/projects as a potential material control weakness11 and improve controls over

environmental management in NASA’s mission-related activities. Specifically, NASA should

revise internal guidance, ensure environmental management planning is performed, improve

oversight of NEPA compliance during program/project formulation, and train employees in the

specific NEPA requirements.

Management’s Response. Management nonconcurred with recommendations to report

NEPA noncompliance as a potential material management control weakness, require

environmental management planning, and bring programs/projects into NEPA compliance.

Management concurred with recommendations for greater Program Management Council

oversight, increased environmental coverage in program/project management guidance,

 

**Deliberative process information omitted.**

10A material weakness is a deficiency that the NASA Administrator determines to be significant enough to

be reported outside the Agency. This designation requires a judgment by Agency managers as to the

relative risk and significance of deficiencies.

11Potential material control weaknesses are reported to the Agency’s Internal Control Council and not

directly to Congress.
iii

revisions to NASA's NEPA and facilities guidance, and increased NEPA training. Management

partially concurred with the recommendation for adding three Council on Environmental Quality

requirements to NASA guidance. Management agreed that NEPA training, guidance, and

managerial controls to ensure NEPA compliance for existing and future programs/projects are

inadequate. However, management took exception to the characterization that

programs/projects totaling about $3 billion are at risk for litigation, stating that the audit report

exaggerated the nature and scope of NEPA violations for the 13 programs/projects reviewed.

Management stated that the programs/projects committed technical, trivial violations of NASA

requirements rather than violations of NEPA and Council on Environmental Quality regulations.

Management also took exception to statements regarding lack of effective NEPA guidance.

The complete text of management’s response is in Appendix F. Details on management’s

general comments and our evaluation are in Appendix G.

Evaluation of Response. Management’s response and planned corrective actions for greater

Program Management Council oversight, increased environmental coverage in program/project

management guidance, revisions to NASA's NEPA and facilities guidance, and increased

NEPA training are responsive. However, management’s responses were not responsive for

recommendations to report NEPA noncompliance as a potential material management control

weakness, require environmental management planning, and bring programs/projects into

NEPA compliance are nonresponsive. We do not agree that program/project managers

violated only NASA requirements. We maintain that because Agency managers were not

aware of NEPA requirements to consider environmental impacts at the earliest planning phase

of a program/project, our finding of noncompliance is not exaggerated, but clearly a violation of

environmental law. We also maintain that environmental considerations must be factored into

the program/project plans at the earliest opportunity, which was not being done.

The report factually stated that 11 programs/projects were not in compliance with NEPA.

Those programs/projects, which had a total value of about $3 billion, could have experienced

increased costs, schedule delays, or missed opportunities. We did not state that the reported

programs/projects were at high risk of litigation, but that failure to perform timely consideration

of environmental impacts could result in litigation. Finally, we recognized the efforts to revise

environmental guidance through issuance of the draft NPG. However, as evidenced by the

number of program/project managers who were unaware of NEPA requirements, NASA must

continue to improve Agency guidance to ensure compliance with NEPA and other

environmental laws.

NEPA noncompliance should be reported as a potential material management control weakness

until guidance, training, and management controls are in place. We maintain that environmental

management planning should be required, and programs/projects should be reviewed and

brought into NEPA compliance. We request that management reconsider its position, and

provide additional comments.
Introduction

In 1994, the NASA Administrator issued “NASA's Environmental Excellence for the TwentyFirst Century.” This document establishes NASA's overall strategy for environmental issues

and states that environmental excellence is a way of life that must be ingrained as part of the

Agency’s culture. NASA must seek solutions that are environmentally safe in designing and

fabricating spacecraft, launching shuttles, or conducting basic research.

The statutory and regulatory framework for NEPA can be found in: Public Law 91-190, which

contains mandates and policy statements; the Council on Environmental Quality regulations in

Title 40, Code of Federal Regulations (CFR), Parts 1500-1508, which contain definitions of

key terms and directions on NEPA compliance; and the Federal agency-specific regulations and

guidelines. Details on the law and CFR are in Appendix D.

NASA requires that environmental factors shall be a significant consideration at every step in

program/project development and execution and shall include an analysis of environmental

impacts and alternatives. NASA Strategic Enterprises and Program Offices are accountable for

all environmental consideration and are ultimately responsible for full environmental compliance.

The Associate Administrator for the Office of Management Systems is responsible for the

Agency’s environmental management activities, such as developing NASA’s guidance on

complying with NEPA and providing technical advice on NEPA implementation. The Office of

Management Systems’ Environmental Management Division is responsible for implementing the

Associate Administrator’s environmental management activities. Details on the Agency’s

NEPA guidance are in Appendix D.

NASA Centers have responsibility for ensuring that the NEPA process is integrated into their

organizations’ planning processes. Each NASA Center has an environmental office that

evaluates activities for environmental impact, develops and approves required environmental

decision documents, and advises Center personnel on NEPA.

The Program Management Councils12 are responsible for reviewing proposed

programs/projects and overseeing implementation according to NASA policies, including those

related to NEPA.

 

12A complete definition of Program Management Councils is in Appendix C.
2

Finding and Recommendations

NEPA Compliance for Programs and Projects

Eleven (85 percent) of 13 reviewed mission-related programs/projects13 did not comply with

NEPA requirements or NASA guidance. Of the nine construction of facilities projects14

reviewed, 100 percent complied with NEPA requirements; however, two did not fully comply

with NASA guidance. The noncompliance exists because NASA’s management controls for

environmental compliance are inadequate in the following areas: planning, oversight, guidance,

and training. NEPA noncompliance related to programs/projects totaling about $3 billion could

result in increased costs, schedule delays, missed opportunities for preferable alternatives and/or

public involvement, and adverse public perception. Due to the extent of NEPA noncompliance

for mission-related programs/projects, we consider this deficiency to be a potential material

control weakness reportable to the Agency’s Internal Control Council.

NASA’s Procedures for Implementing NEPA

NASA procedures for implementing NEPA are contained in various regulations, guidelines, and

handbooks. Title 14, CFR, Subpart 1216.3 (CFR 1216.3), “Procedures for Implementing

NEPA,” last amended October 7, 1991, requires managers to consider in the early planning

phase the potential environmental effects of all proposed activities. The CFR 1216.3 addresses

management’s responsibilities and identifies criteria for the three levels of NEPA consideration

(categorical exclusion,15 environmental assessment, and environmental impact statement);

requirements for documentation; and procedures for requesting deviations from the CFR

1216.3. The CFR 1216.3 and draft NPG 8840, “NASA Procedures and Guidelines for

Implementing NEPA and Executive Order 12114,” most recent version dated

October 26, 1999, provide criteria for specific activities normally requiring environmental

assessments or environmental impact statements as well as activities that are excluded from

Agency and CFR requirements.

NASA’s Environmental Management Division directed environmental employees to follow the

draft NPG 8840 in implementing NEPA. NPG 8840 has been under development and in draft

for 4 years. During the course of this audit, the Agency placed a

 

**Deliberative process information omitted.**

15A categorical exclusion is a category of actions that do not have a significant effect on the human

environment. Neither an environmental assessment nor an environmental impact statement is required if a

proposed action is a categorical exclusion.
3

greater emphasis on issuance of the guidance in final form. The draft NPG 8840 provides

NASA’s overall environmental planning process and standard procedures for implementing

NEPA.

NPG 8820.2B, “Facility Project Implementation Handbook,” dated April 25, 1997, is

NASA's project management guidance for facility planning, budgeting, construction, and

environmental compliance. The handbook's planning chapter describes how to incorporate

NEPA into the facility planning process. The handbook addresses preparing the environmental

evaluation, assessment, and impact statement; identifying categorical exclusions; and issuing a

finding of no significant impact16 and a record of decision.17 The handbook encourages early

participation by the Centers’ environmental offices in the environmental review process.

NPG 7120.5A, “NASA Program and Project Management Processes and Requirements,”

dated April 3, 1998, provides guidance on implementing NEPA for aerospace program/project

managers. However, the NEPA coverage consists of only three statements referencing the

NEPA law, the environmental office contacts that managers must make, and the NEPA

statement that should be included in project plans (see details in Appendix D).

Status of NEPA Compliance at Three NASA Centers

We reviewed the process for implementing NEPA and tested a total of 13 mission-related and

a total of 9 construction of facilities programs/projects at the John H. Glenn Research Center at

Lewis Field (Glenn), John F. Kennedy Space Center (Kennedy), and George C. Marshall

Space Flight Center (Marshall). A complete list of programs and projects reviewed is in

Appendix E.

Mission-Related Programs and Projects. Of the 13 programs/projects reviewed at Glenn

and Marshall, 11 (85 percent) did not comply with either the NEPA requirements or NASA

guidance because the managers did not consider and document environmental impacts. Seven

of the managers did not consider environmental impacts because they were unaware of the

NEPA requirements. The remaining four managers, although aware of NEPA and NASA

guidance, did not perform environmental evaluations or prepare

 

16A finding of no significant impact is a document a Federal agency prepares if its environmental assessment

determines that the proposed action will have no significant environmental impact.

17A record of decision is a document a Federal agency prepares to record the decision it made based on an

environmental impact statement.
4

records of environmental consideration as required. The four cases of noncompliance were

**Deliberative process information omitted.**

• **Deliberative process information omitted.**program manager did not know

whether an environmental evaluation had been performed during program

**Deliberative process information omitted.** The program plan included a

statement that there was no known environmental impact associated with the

program; however, this statement was obtained from the contractor, and the Center

has no documentation to support it.

• The project **Deliberative process information omitted.**did not perform the

evaluation because he mistakenly believed that the contractor’s response to a NonAdvocate Review18 question satisfied NEPA requirements. The contractor

responded **Deliberative process information omitted.** would have no additional

environmental **Deliberative process information omitted.** The project manager

had no evidence of an evaluation.

• **Deliberative process information omitted.** 19 mistakenly determined that

performing environmental evaluations was inappropriate at the program level. Both

managers are responsible for overseeing multiple projects that fall under their

programs. Therefore, the program managers believed it was the project manager’s

responsibility to perform an environmental evaluation. However, NEPA requires

that Federal agencies consider environmental impacts on all actions, and NASA

guidance requires that program managers evaluate all new programs for NEPA

compliance.

 

**Deliberative process information omitted.**
5

The two managers who complied with the NEPA were responsible for the Chandra X-ray

Observatory program (Chandra)20 and the X-33 Advanced Technology Demonstrator Vehicle

program (X-33).21 The contractor for the Chandra program performed the environmental

evaluation and documented that the program would have no significant environmental impact.

The program manager for the X-33 was aware of NEPA requirements and upon realizing the

potential environmental impacts of the X-33, coordinated with the manager of the Marshall

Environmental Engineering Department. As a result, Marshall prepared the NEPA required

environmental assessment and environmental impact statement.

In addition to reviewing programs and projects, we reviewed the Center's process for

implementing NEPA. We had concerns about whether Glenn’s existing controls for evaluating

NEPA for mission-related activities would ensure compliance with NEPA. For example,

managers did not evaluate programs/projects early enough or at the appropriate level. Glenn

performed the NEPA evaluation in coordination with its safety permit22 process. The safety

permit process was initiated during the project's implementation phase rather than the

formulation/planning phase as required. Waiting until the implementation phase is too late to

initially assess for NEPA because any changes to the program/project due to a NEPA action

could increase costs and cause delays. Also, the NEPA evaluation is implemented at the task

level rather than the program/project level. Because the NEPA consideration is tied to the

safety permit process, Glenn does not have sufficient controls to ensure that NEPA is

considered early enough and at the appropriate program/project level. In addition, Glenn may

not have factored environmental considerations and environmentally preferable alternatives into

the acquisition strategy.

Construction of Facilities Projects. All nine of the reviewed construction of facilities projects

complied with the NEPA requirements. However, two did not fully comply with NASA

guidance in CFR 1216.3, draft NPG 8840, and NPG 8820.2B. Specifically, the guidance

requires that managers for major construction of facilities projects prepare an environmental

assessment23 or obtain a deviation from NEPA requirements. Neither of the two managers

prepared an environmental assessment because the environmental management offices at their

respective Centers concluded that the projects would have no environmental impact. At

Marshall, the environmental management office performed a preliminary environmental survey

 

**Deliberative process information omitted.**

22A safety permit is a license issued to operate a facility or piece of equipment within the constraints listed

on the permit. All managers of proposed test operations must request a safety permit.

23An environmental assessment is required for each major construction of facilities project, which is defined

in NPG 8820.2B as a construction project valued in excess of $750,000; or a repair, rehabilitation, or

modification project valued in excess of $1,000,000.
6

that concluded the project would have no environmental impact. At Kennedy, the

environmental management office reviewed the environmental checklist24 received from the

project manager and concluded that the project would have no environmental impact.

The CFR 1216.305(b) cites seven “specific NASA actions normally requiring an environmental

assessment” but does not explicitly identify when one should be performed. Even though the

two projects had no environmental impact, the Headquarters NEPA Coordinator25 agreed that

to fully comply with NASA guidance, each manager should have obtained a deviation from

NEPA requirements as required by CFR 1216.3 and the draft NPG 8840. These

circumstances clearly demonstrate the need for revised guidance for environmental assessments,

which is discussed in more detail in the Environmental Guidance section later in this report.

The nine projects that were in compliance with Federal requirements can be attributed to

greater controls over the construction of facilities projects. Specifically, NASA has included

detailed guidance in NPG 8820.2B on how to implement NEPA. Further, environmental

managers coordinate efforts with the facilities managers for all construction projects. For

example, the facilities offices include the environmental office in the facilities budgeting process,

obtain an environmental staff member as part of the team, invite environmental staff to project

meetings, and maintain a working relationship with the environmental offices. Conversely, the

lack of detailed guidance and coordination between mission-related and environmental

managers has contributed to the lack of NEPA compliance for Agency programs/projects.

Controls Over NEPA Implementation

NASA’s noncompliance with NEPA demonstrates the need to improve environmental

management controls. Specifically, NASA has not emphasized the need for environmental

management planning to ensure compliance with environmental law, NASA oversight and

guidance addressing NEPA is inadequate, and NASA has not trained most program/project

managers on the NEPA requirements. An effective system of management controls, as

explained below, could better ensure that NASA complies with NEPA.

Environmental Management Plan. An environmental management plan is an effective

management tool that allows managers to identify, assess, and mitigate risks, delays, and costs

associated with a program/project at the earliest opportunity. NASA does not specifically

require the preparation of an environmental management plan. Accordingly, program/project

managers have not taken sufficient measures to consider and minimize potential adverse impacts

to both the environment and the Agency.

 

24An environmental checklist is a form, a portion of which is in checklist format, that summarizes the purpose

and physical characteristics of a proposed project. The Center environmental management offices review

each completed checklist to determine whether the project is categorically excluded or requires the

preparation of an environmental assessment or environmental impact statement.

25The NEPA Coordinator is an official of the Office of Management Systems’ Environmental Management

Division.
7

NASA has performed various studies showing that poor planning and definition of requirements

results in cost growth and greater technical risk. Consequently, a major theme of

NPG 7120.5A is that NASA require and allow time for managers to adequately plan at the

beginning of each new program/project. While NPG 7120.5A addresses safety, mission

success, risk management, and acquisition planning, it does not fully and completely address the

benefits of environmental planning. Environmental management plans would help to ensure that

program/project proposals are subjected to the NEPA process at the earliest planning phase

and that environmental considerations and alternatives are part of the Agency’s acquisition

strategy. Also, an environmental management plan would be a good tool to document and

track NEPA compliance and to facilitate oversight of NEPA compliance by the Program

Management Councils.

The Federal Acquisition Regulation (FAR) and the NASA FAR Supplement also do not require

preparation of environmental management plans as part of the acquisition planning process.

However, the FAR, Part 7, “Acquisition Planning,” requires that acquisition plans address all

applicable environmental issues associated with an acquisition, including the need for an

environmental assessment or environmental impact statement, proposed resolution of

environmental issues, and any environmentally related requirements to be included in solicitations

and contracts. FAR, Part 23.7, “Contracting for Environmentally Preferable and EnergyEfficient Products and Services,” requires that agencies implement cost-effective contracting

programs favoring environmentally preferable products and services. In addition, the NASA

FAR Supplement, Part 1807, further emphasizes the value of an acquisition strategy and

specifically states that NPG 7120.5 shall be an integral part of acquisition planning for

programs/projects. In our opinion, managers can more fully comply with NPG 7120.5A by

performing comprehensive environmental management planning that addresses how a

program/project will fulfill the full range of environmental requirements. Environmental planning

should also specify how the program/project manager would monitor environmental compliance

and the role of NASA managers, the Program Management Councils, and the contractors.

Oversight Responsibilities. NASA’s oversight of program/project formulation and

implementation processes has not adequately covered NEPA compliance. This is evident by

the noncompliance of the programs/projects noted in this report.

As part of its strategic management planning and implementation of NPG 7120.5A, NASA

formed Program Management Councils to oversee program/project management. The

Associate Administrator for Management Systems is a member of the Agency Program

Management Council. The Program Management Councils are responsible for reviewing

proposed programs and assessing existing programs/projects to evaluate cost, schedule, and

technical content to ensure that NASA is meeting its commitments specified in program

commitment agreements,26 program plans, and project plans. Thus, NASA has focused its

 

26A program commitment agreement is a contract between the NASA Administrator and the cognizant
8

oversight efforts on schedules, cost, and technical performance and not on other NPG 7120.5A

requirements, such as environmental compliance.

Additionally, program managers are responsible for overseeing projects that fall under their

programs. However, in some cases, program managers are relying on project managers to

evaluate and document environmental consideration. As noted in this report, none of the seven

projects reviewed complied with NEPA. This noncompliance indicates that project managers

are not evaluating potential environmental impacts as required by NEPA, and that the program

managers are not providing environmental oversight as required by NASA guidance.

Although NASA has established management councils to oversee NASA’s programs/projects,

the majority of programs/projects we reviewed are not complying with NEPA and other

Agency environmental guidance. We concluded that the current oversight has not provided the

necessary emphasis on the NEPA requirement to consider and document potential

environmental impacts.

NASA Guidance. Guidance in the Agency NPG’s and the CFR needs to be changed to

ensure that NASA employees comply with NEPA.

**Deliberative process information omitted.**

 

Enterprise Associate Administrator for implementation of a program.
9

**Deliberative process information omitted.**

Facility Project Guidance. NPG 8820.2B provides thorough coverage of NEPA and

coordination of projects with NASA environmental offices. The handbook is an important

control that helps ensure that construction of facilities project managers comply with NEPA.

However, some NASA procedures have changed since the issuance of NPG 8820.2B, and the

handbook is now outdated. NPG 8820.2B needs to be updated to reflect current policies and

procedures. Specifically, the NPG requires that the NASA Form 1509, Brief Project

Document, contain a statement describing the completion of the NEPA process but does not

provide specific guidance on the content and structure of the statement. Subsequent to issuance

of the NPG, the Facilities Engineering Division developed specific instructions for preparing the

NASA Form 1509, and those instructions should be incorporated into the revised NPG. Six of

the nine construction of facilities projects reviewed did not comply with the Facilities Engineering

Division requirements for completing the NASA Form 1509.

NASA Guidance in the CFR. CFR 1216.3 needs to be revised because it is too

broad and does not provide clear guidance to NASA employees. The NASA Environmental

Management Division plans to revise CFR 1216.3 and estimates the revision will take from 2 to

4 years to complete. The CFR 1216.3 requires revisions in the following areas:

• The definition of what constitutes a categorical exclusion omits the key criterion,

which is lack of significant environmental impact. This omission could lead

program/project managers to erroneously conclude that an action falling into one of

the categorical exclusion categories is excluded even if the managers deem that

there is a significant environmental impact.

• The eight specific categorical exclusions are vaguely worded and broad in scope.

For example, one of the categories is "research and development activities in space

science other than specific spacecraft development and flight projects." Such

wording is of limited assistance when a program/project manager is faced with a

decision as to which activities within space science are categorically excluded. In

contrast, categorical exclusions at other Federal agencies are more precisely stated

and are usually narrower in scope.27

 

27The Department of Energy (Energy) lists 103 categorical exclusions in 10 CFR Part 1021, Appendixes A and

B. Energy lists 15 categorical exclusions applicable to general agency actions and 88 applicable to specific
10

• The CFR cites actions that normally require an environmental assessment, but does

not define “normally.” The two major construction of facilities projects that did not

fully comply with the NASA guidance demonstrate the need for revised procedures

regarding the requirements for preparing an environmental assessment. The two

construction project managers did not perform an assessment because there was no

environmental impact, while other managers performed an assessment for all major

construction projects regardless of impact. The lack of definition for “normally” has

resulted in various interpretations of the requirement for an assessment.

• Criteria for whether to perform an environmental assessment on construction of

facilities projects are based on the project’s dollar value. However, experience has

shown that high-dollar projects, in some cases, can have little or no environmental

impact whereas low-dollar or no-cost projects can have significant environmental

impact. Therefore, dollar value is not an effective criterion for environmental

impact. The two major construction of facilities projects that did not fully comply

with the NASA guidance also demonstrate the need for revised procedures for

using dollar value as a factor for performing an environmental assessment. Although

the CFR required an environmental assessment for both projects because of dollar

value, neither had an environmental impact.

Environmental Guidance. Although NASA has updated its environmental guidance

through the issuance of the draft NPG 8840, the revision has been in process for 4 years. We

identified a total of 125 requirements in the NEPA law and the Council on Environmental

Quality regulations. Only three Council requirements were not covered in the draft NPG 8840:

• Agencies must designate a person to be responsible for overall review of agency

NEPA compliance.

• Draft environmental impact statements must list all Federal permits, licenses, and

other entitlements prior to implementing the activity proposal.

• An agency may adopt a Federal draft or final environmental impact statement

provided that it meets Council standards.

Promptly revising NASA’s guidance would strengthen environmental management controls and

help ensure that Agency managers comply with NEPA.

 

agency actions. Some examples of Energy categorical exclusions are: routine administrative, financial, and

personnel actions; transfer of property; information gathering, data analysis, documentation preparation,

dissemination; improvements to cooling water systems within existing buildings and structures; installation

of fencing with no adverse effect; and noise abatement.
11

Training on NEPA Requirements. The majority of the program/project managers had not

received NEPA training. Of the 11 mission-related program/project managers that did not

comply with NEPA, 10 stated that they had not received training in NEPA.

NASA Headquarters environmental and enterprise managers have not yet established a formal

training program that includes adequate coverage of NEPA requirements and the potential

impacts of noncompliance. However, officials from the Environmental Management Division

have contacted and briefed several Headquarters and Enterprise officials regarding the NEPA

requirements. Also, Center environmental managers have provided some NEPA training to

Center personnel but not enough to ensure NEPA awareness. For example, Kennedy has no

formal environmental training program but offers environmental leadership presentations, which

include coverage of the NEPA requirements, to Kennedy senior managers on an annual basis.

Glenn has offered environmental training sessions that included NEPA requirements; however,

the training has not been provided in the last few years, and for the most part, attendees were

not managers of mission-related activities. Marshall has provided some NEPA training to

specific groups at the Center but does not have a formal training program that covers NEPA.

While Glenn, Kennedy, and Marshall are providing some NEPA training, a formal NASA-wide

environmental management training program would be a more effective means of ensuring that

all program/project managers are aware and knowledgeable of the NEPA requirements.

Further, the training program should be available at the Centers. NASA’s Environmental

Management Division is developing a curriculum for a formal training program.

Adverse Effects of Noncompliance

Management controls are essential not only to ensure compliance with environmental laws and

regulations, but also to identify and mitigate adverse environmental impacts, risks, and costs to

Agency programs/projects. The Agency’s lack of compliance with the NEPA law and/or

NASA guidance, as shown in 13 (59 percent) of the 22 programs/projects reviewed, can have

adverse environmental impacts in addition to potentially violating Federal laws and NASA

guidance. Specifically, noncompliance can result in:

• Unnecessary program/project delays or stoppages and increased cost. Failure to

complete all of the NEPA procedural requirements is a primary cause for adverse

judicial judgments. In the event of a court challenge, time is lost and resources are

expended dealing with court actions, and program/project schedules may be

delayed or put on hold until the NEPA procedural steps are completed. In

addition, the Agency could incur added costs for documentation efforts, potential

contract modifications, and other costs associated with revising a program/project.

• Lost opportunities to consider other reasonable alternatives and their environmental

impacts early in the project planning phase. This occurs when NEPA compliance

occurs too late or when hard commitments are made that limit choices for
12

alternatives or essentially drive the Agency to choose a particular alternative.

Failure to include reasonable alternatives in an environmental impact statement is

one of the most common bases for litigation.

• Limited public involvement. Public involvement is a key element of NEPA

compliance. Failure to obtain and consider the views of the public hinders full and

fair consideration of the environmental impacts of proposed actions and alternatives

in those cases in which a significant environmental impact exists.

NASA benefited from complying with NEPA on the X-33 Advanced Technology

Demonstrator program. As a result of preparing an environmental impact statement, Marshall

identified the potential for snow avalanches at nearby ski areas and took steps to reduce the risk

of injury and damage. Also, Marshall identified an endangered tortoise that may have been

negatively impacted and was able to establish procedures to mitigate harm to the tortoise.

Under NEPA, three NASA missions28 have been challenged in court over the last 10 years by

anti-nuclear groups opposed to the launching of nuclear materials for outer space missions.

NASA succeeded in all three cases because it complied with the NEPA requirements and, as a

result, prepared sound environmental impact statements and records of decision. However,

NASA has 13 programs/projects valued at about $3 billion that are not in compliance with

NEPA.

When Federal agencies have not followed the NEPA requirements, plaintiffs have increased

costs of projects and delayed them for years. For example, plaintiffs successfully delayed and

increased the cost of two federally-funded construction projects (Federal Highway

Administration and the Army Corp of Engineers), a road construction project and a water

reservoir project, because the project managers did not properly prepare the environmental

impact statements. Plaintiffs often use environmental impact statement reviews performed by

the Environmental Protection Agency to support their noncompliance claims in court.

 

28 The three missions that the anti-nuclear groups challenged were Galileo, Ulysses, and Cassini.
13

Recommendations, Management’s Response, and Evaluation of

Response

Management provided extensive comments on the report which we address in Appendix G.

The Associate Administrator for Management Systems should:

1. Report NEPA noncompliance for mission-related programs/projects to the

Internal Control Council as a potential material management control weakness

to be included in NASA’s annual Federal Manager’s Financial Integrity Act

statement of assurance.

Management’s Response. Nonconcur. Management stated that the report exaggerates the

nature and scope of NEPA noncompliance and violations of the Council on Environmental

Quality and NASA regulations. However, management agreed that NEPA guidance, training,

and managerial controls are inadequate. Management would concur with a recommendation to

report “non-trivial” NEPA violations for mission-related programs/projects. The complete text

of management’s comments is in Appendix F.

Evaluation of Response. Management’s comments are nonresponsive to the

recommendation. Consideration of environmental impacts in the early planning phase of

NASA’s programs/projects is the core concept of NEPA. We maintain that because NASA

managers did not comply with this concept, the reported NEPA noncompliance and violation of

the Council on Environmental Quality regulations are not exaggerated. We also maintain that

future violations should be reported to the Internal Control Council, but consider the present

state of noncompliance, including the inadequate guidance, training, and controls, to be a

potential material control weakness until corrected. We, therefore, request that management

reconsider its position and provide additional comments.

2. Establish a requirement in NPG 7120.5A for environmental management

planning to facilitate acquisition management and mitigate adverse impacts,

risks, and costs to Agency programs and projects.

Management’s Response. Nonconcur. Management stated that such a recommendation

implies the need for a formal environmental management plan. While a formal plan cannot be

justified, there should be a requirement to factor environmental considerations into

program/project planning to ensure better decision making and to mitigate potential adverse

environmental, risk, and cost impacts. Management will advocate to the Program Management

Council Working Group that managers demonstrate a commitment to integrating environmental

planning into program/project planning.
14

Evaluation of Response. The planned action is nonresponsive to the recommendation. We

do not consider a separate environmental management plan essential. Rather, including

requirements in the revised program plan would be sufficient. Management agrees that NASA

should establish a requirement to factor environmental considerations into program/project

planning, but does not concur with the recommendation to include this requirement in NPG

7120.5A. We believe that considering environmental factors is, in essence, environmental

management planning. Therefore, we maintain our position that NPG 7120.5A be modified and

request that management reconsider its position and provide additional comments.

3. Require Program Management Councils to provide sufficient oversight to

ensure programs and projects comply with environmental laws and Agency

guidance.

Management’s Response. Concur. Management will advocate that progress in fulfilling

environmental mandates be a required element for reporting to the Program Management

Councils. Further, management will develop a process to increase NEPA awareness, set

schedules for satisfying NEPA requirements, and establish controls to ensure adherence to

those schedules.

Evaluation of Response. The actions planned are responsive to the recommendation. The

recommendation is considered resolved but will remain undispositioned and open until the

agreed-to corrective actions are completed.

4. Increase NEPA and environmental management coverage in the revised

NPG 7120.5 through coordination with the Program Management Council

Working Group and the Environmental Management Division.

Management’s Response. Concur. Management will advocate that program/project

formulation schedules include environmental compliance. The Environmental Management

Division recently provided input to improve environmental coverage in NPG 7120.5A. The

Environmental Management Division will request that the Program Management Council

Working Group consider additional input in light of the Office of Inspector General (OIG)

report.

Evaluation of Response. The action planned is responsive to the recommendation. The

recommendation is considered resolved but will remain undispositioned and open until the

agreed-to corrective action is completed.

5. Expedite the revision of CFR 1216.3, providing more in-depth coverage for

categorical exclusions and removing dollar thresholds on categorical

exclusions.
15

Management’s Response. Concur. Management agrees that a new regulation would make

NEPA compliance more efficient, leading to long-term savings in resources and time needed to

conduct effective environmental planning. The Environmental Management Division had already

identified that the recommended revisions would materially enhance NEPA compliance and will

advocate the need for additional resources to revise current regulations.

Evaluation of Response. The action planned is responsive to the recommendation. The

recommendation is considered resolved but will remain undispositioned and open until the

agreed-to corrective action is completed.

6. Add the three omitted Council on Environmental Quality requirements to the

draft NPG 8840, and expedite issuance of the final version.

Management’s Response. Partially Concur. Management nonconcurred with adding the

first of the three Council requirements, stating that the draft NPG 8840 already addressed it.

However, management will post the name of the NASA NEPA coordinator on the

Headquarters’ environmental Web site and develop a list of NEPA contacts at each NASA

installation.

Management concurred with adding the second Council requirement, stating that corrective

action had already been completed.

Management nonconcurred with adding the third Council requirement stating that additional

guidance on "adoption” is not warranted at this time. Further, a hyperlink to the Council

regulations will be added when the NPG is placed on the NASA Online Directives Information

System. Finally, although adding language to the draft NPG this late in the revision process will

materially delay final issuance, management will consider additional adoption mandates during

development of new NEPA regulations.

Evaluation of Response. Management’s comments are responsive to the recommendation.

Regarding the first council requirement, the current language in the draft NPG combined with

plans to identify Agency NEPA points of contact on the Headquarters Web site satisfies the

intent of our recommendation. In relation to the third council requirement, there are plans to

include a hyperlink to the Council regulations; therefore, we agree that delaying final issuance of

the draft NPG 8840 is not warranted. We further agree that additional adoption mandates

should be considered during future revisions to the NPG. The recommendation is considered

resolved and closed for reporting purposes.

7. Revise the NPG 8820.2B to include the Facilities Engineering Division's

instructions for completing the NASA Form 1509, including the required

statement indicating completion of the NEPA review.
16

Management’s Response. Concur. The Facilities Engineering Division, in coordination with

the Environmental Management Division, will amend the NPG 8820.2B to reflect the NASA

Form 1509 instructions and other changes that would more effectively and efficiently ensure

environmental compliance. An interim solution will be in place by August 1, 2000, pending

revisions to the NPG.

Evaluation of Response. The actions planned are responsive to the recommendation. The

recommendation is considered resolved but will remain undispositioned and open until the

agreed-to corrective actions are completed.

8. Direct Center Directors to bring the programs/projects identified in Appendix E

into compliance with NEPA.

Management’s Response. Nonconcur. The Environmental Management Division stated that

12 of the 13 programs/projects were either technical, trivial violations due to a lack of

documentation or fully in compliance. Management was unable to obtain information on one

project.

Management stated that eight trivial violations occurred because four managers did not

document either a categorical exclusion or a record of consideration, two managers

misinterpreted NASA guidelines, and one manager did not perform an environmental

assessment. Management will document each of the files to correct seven of the violations and

will evaluate whether adopting an Air Force environmental assessment is an appropriate remedy

for the remaining violation.

For the four programs/projects that were in compliance, management stated that two were

either addressed in or fell within the scope of the International Space Station environmental

impact statement, and two were so broad in scope that a meaningful consideration of NEPA at

the program level was impossible.

Evaluation of Response. Management’s comments are nonresponsive to the

recommendation. We disagree that six of the mission-related programs/projects were trivial

(lack of documentation) violations of NEPA. Our finding related to the lack of early

consideration of the potential environmental impacts which resulted in these deficiencies. We

found that management had not, in most cases, considered and/or evaluated environmental

impacts during the programs/projects planning phase, as required by NEPA. For example,

management states that three of the violations were trivial because managers did not document

that the programs/projects met the criteria for a categorical exclusion. Our review showed that

those three managers were not aware of NEPA requirements or the criteria for categorical

exclusions. In another example, management agrees that one manager did not perform an

environmental assessment as required. Although a subsequent review by the Office of General

Counsel may show that NASA can adopt the Air Force’s environmental assessment, the

program manager did not properly consider NEPA-related risks to NASA at the onset of the

program. We, therefore, conclude the process needs improvement and maintain that the
17

reported examples are not trivial violations of NEPA but are indications of the effect of the

problem.

We agree that the two construction of facilities project managers considered NEPA, but

misinterpreted NASA guidance for obtaining a waiver for the NEPA process. Accordingly, our

report states that all the construction of facilities projects were in compliance with NEPA, and

only two were not in full compliance with NASA guidance. Those two violations were included

in the report to illustrate that NASA guidance is unclear and inadequate.

Management’s response indicates that four of the programs/projects were in full compliance

with NEPA. For example, management’s response stated that two of the program/projects fell

within the scope of the International Space Station environmental impact statement. Although

an environmental evaluation performed after the initial planning stage may verify that the

programs/projects fell within an existing environmental impact statement, neither of the program

managers was aware of NEPA requirements or that their program/project may fall within the

scope of an existing impact statement. We will evaluate the compliance of the remaining two

programs/projects given that sufficient documentation to support management’s position of

compliance was provided.

“After-the-fact” evaluations by the Environmental Management Division may show that the

programs/projects did not have significant environmental impacts and that Agency managers

need only document records of consideration. However, we maintain that because of

inadequate planning, oversight, guidance, and training, NASA did not comply with the intent of

NEPA by considering environmental impacts at the earliest planning phase of a

program/project. We, therefore, request that management reconsider its position and provide

additional comments.

9. Review current environmental training programs with the Associate

Administrators for each Strategic Enterprise and the NASA Environmental

Management Division, and establish programs that provide adequate NEPA

coverage.

Management’s Response. Concur. The Environmental Management Division is developing

an environmental training module, which includes NEPA, for new program/project managers.

Further, the Division is advocating a comprehensive educational program addressing NEPA and

other environmental planning for NASA senior staff, program/project managers, and a

mandatory course for at least one environmental staff member at the NASA installations.

Evaluation of Response. The actions planned are responsive to the recommendation. The

recommendation is considered resolved but will remain undispositioned and open until agreedto corrective actions are completed.
18

Appendix A. Objectives, Scope, and Methodology

Objectives

The overall objective of the audit was to determine whether NASA guidance ensures

compliance with NEPA. The specific objectives were to assess whether NASA:

• guidance fulfills NEPA requirements and

• managers evaluated programs/projects in compliance with the NEPA requirements

and NASA guidance.

Scope and Methodology

We limited our review to programs and projects at three Centers: Glenn, Kennedy, and

Marshall. We reviewed Federal laws and regulations related to NEPA. We also reviewed

Agency regulations, guidance, and processes and discussed the overall NEPA process with the

Headquarters and Center environmental management officials.

To accomplish the first objective, we reviewed the NASA guidance and NEPA requirements

described in Appendix D. We then compared CFR 1216.3 and draft NPG 8840 to the NEPA

law and Council regulations. We performed the comparison by cross-referencing those

documents and noting inaccuracies or omissions in the draft NASA guidance. We also

assessed the adequacy of NEPA coverage in NPG 7120.5A and NPG 8820.2B. In addition,

we obtained information from other Federal agencies (Department of Energy, Department of

Defense, and the Environmental Protection Agency) related to categorical exclusions,

environmental management plans, and court cases.

To accomplish the second objective, we interviewed key management and environmental

personnel, reviewed and summarized the NEPA process, and examined relevant

documentation. Relevant documentation included environmental checklists and other

evaluations, records of environmental consideration, environmental assessments, findings of no

significant impact, environmental impact statements, and program/project plans. We developed

universes of FY 1999 active mission-related programs/projects and FY’s 1999 and 2000

construction of facilities projects at each Center we reviewed and tested a random sample of

programs/projects for compliance with the NEPA requirements and NASA guidance. We

interviewed the program/project managers and environmental management staff, and examined

relevant documentation to determine whether the managers evaluated programs/projects in

compliance with NEPA requirements and NASA guidance.
19

Appendix A

Use of Computer-Processed Data. We did not rely on computer-processed data during our

audit.

Audit Universe and Sample. We developed our universes of mission-related

programs/projects from listings already developed by the Centers and Enterprises. We used

criteria for program/project designation in accordance with NPG 7120.5A for determining

whether an activity was a program or project. We compared the listings of programs/projects

to other information obtained from Center officials and resolved any discrepancies.

We developed our universes of construction of facilities projects from FY’s 1999 and 2000

program operating plan budgets at each Center. We excluded environmental compliance and

restoration projects from the universe because they are environment-related and are usually

managed by the Center’s environmental management office.

From each universe, we randomly selected samples for testing using random number tables.

The chart below shows the universes, sample sizes, and budgets of programs/projects reviewed

at the three Centers.

Universe and Sample Sizes of Programs and Projects Reviewed

Sample Sample/Universe Size

Budget

Universe Description ($ millions) Glenn Kennedy Marshall

Mission-related programs $5,366 0/010/026/63

Mission-related projects $674 4/22 0/043/133

Construction of facilities projects $43 3/14 4/49 2/42

Totals $6,083 7/36 4/49 11/181

1We excluded the Glenn Propulsion Systems program from the universe because the program provided only

administrative services for projects underneath it and had no mission-related duties.

2We excluded two Kennedy programs, Expendable Launch Vehicle Mission Support and Payload Carriers,

from the universe because the programs originated before NEPA was enacted and thus did not require

compliance.

3We excluded the Marshall Microgravity Research program from the universe because the program provided

only administrative services for projects underneath it and had no mission-related duties.

4We excluded two Kennedy projects, Checkout and Launch Control System and Test, Control, and Monitor

System, from the universe because the projects were categorically excluded and did not require a record of

environmental consideration according to the draft NPG 8840 and the NASA NEPA coordinator. Both

projects involve the development and installation of mission-related computer systems and equipment.
20

Appendix A

Management Controls Reviewed

We reviewed management controls related to identifying and analyzing proposed

programs/projects for environmental impact. Specifically, we reviewed NASA guidance for

implementing NEPA and the processes developed at the three Centers. We considered

management controls to be a potential material control weakness as discussed in the finding.

Audit Field Work

We conducted field work from March 1999 to January 2000 at Glenn, Kennedy, and Marshall.

We performed the audit in accordance with generally accepted government auditing standards.
21

Appendix B. NASA’s NEPA Process

NEPA requirements and NASA guidance require that all Agency activities consider

environmental impacts in the earliest planning phase. NASA’s NEPA process in draft

NPG 8840 is illustrated below. Once a program or project proposal is formulated, the Agency

managers, in coordination with the applicable Headquarters or Center environmental

management offices, should perform an environmental evaluation to assess potential

environmental impacts. The environmental evaluation could result in one of three outcomes:

categorical exclusion (CatEx), environmental assessment (EA), or environmental impact

statement (EIS).

THE NEPA PROCESS

Proposal Formulated

Perform EnvironmentalEvaluation

YES

Prepare Record

of Environmental

Consideration

Prepare Notice

of Intent

Conduct Scoping

Prepare Environmental

Impact Statement

Prepare Record

of Decision

Prepare Environmental

Assessment

Impacts

Significant?

Implement and Adjust Action

Document

Required ?

CatEx

E A

EIS

N o

 Prepare Finding of

 No Significant Impact
22

Appendix C. Glossary

Acquisition Planning. The process by which the efforts of all personnel responsible for an

acquisition are coordinated and integrated through a comprehensive plan for fulfilling an agency

need in a timely manner and at a reasonable cost. Planning includes developing the overall

strategy for managing the acquisition.

Actions. New and continuing activities, including programs and projects; new or revised

agency rules, regulations, plans, policies, or procedures; and legislative proposals.

Categorical Exclusion. A category of actions that do not have a significant effect on the

human environment; therefore, neither an environmental assessment nor an environmental impact

statement is required.

Construction of Facilities. A congressional appropriation that funds contractual services for

the repair, rehabilitation, and modification of existing facilities; construction of new facilities,

acquisition of related collateral equipment; environmental compliance and restoration activities;

design of facilities projects; and advanced planning related to future facility needs.

Environmental Assessment. A concise public document that briefly provides sufficient

evidence and analysis for determining whether to prepare an environmental impact statement or

a finding of no significant impact. The document includes a brief discussion of the need for the

proposal, alternatives, the environmental impacts of the proposed action and alternatives.

Environmental Compliance and Restoration Project. A construction of facilities project

that addresses (a) the construction or modification of facilities as required for environmental

compliance, (b) the cleanup and remediation of hazardous substance contaminated sites, or (c)

a single environmental study.

Environmental Evaluation. The process of making the initial evaluation of the environmental

effects of a proposed action including alternative proposals.

Environmental Impact Statement. A detailed statement that documents the environmental

analyses of major Federal actions that have a significant impact on the quality of the

environment. The statement discloses information to the public, assists agency officials in

making decisions, and provides full and fair discussions of significant environmental impacts and

available alternatives that would minimize environmental impact.
23

Appendix C

Finding of No Significant Impact. A document prepared by a Federal agency briefly

presenting the reasons an action will not have a significant effect on the human environment and

for which an environmental impact statement, therefore, will not be prepared. The document

includes the environmental assessment, or a summary of it, on which the finding is based.

Formulation Process. A process that defines a program or project concept and results in an

implementation plan to meet mission objectives or technology goals as specified in the NASA

and Enterprise Strategic Plans.

Life-Cycle Cost. The total of the direct, indirect, recurring, nonrecurring, and other related

expenses incurred in the design, development, verification, production, operation, maintenance,

support, and retirement of a system over its planned lifespan.

Major (Discrete) Construction of Facilities Project. A construction of facilities project

valued in excess of $750,000; repair, rehabilitation, and modification in excess of $1 million;

and land acquisition and emergency repair at any cost.

Minor Construction of Facilities Project. A construction of facilities project in excess of

$200,000 but not exceeding $750,000 or repair, rehabilitation, and modification in excess of

$200,000 but not exceeding $1 million.

Program. A major activity within an Enterprise having defined goals, objectives, requirements,

and phased funding levels and consisting of one or more projects.

Program Management Councils. The Agency Program Management Council is the senior

management group responsible for reviewing, recommending approval of proposed programs,

and overseeing their implementation according to Agency policies. Governing Program

Management Councils are forums composed of Headquarters and Center senior managers who

assess program/project planning and implementation and provide oversight and direction.

Project. A significant activity within a program having defined goals, objectives, requirements,

life-cycle cost estimates, a beginning, and an end.

Proposal. The development stage of a program/project when an agency has a goal and is

actively preparing to make a decision on one or more alternative means of accomplishing that

goal and the effects can be meaningfully evaluated.

Record of Decision. A concise public record prepared by a Federal agency at the time it

makes a decision that is based on an environmental impact statement. The record states
24

Appendix C

the decision, identifies all alternatives considered by the agency, and states whether all

practicable means to avoid or minimize environmental harm from the alternative selected have

been adopted.
25

Appendix D. Laws and Regulations

This appendix describes the laws, regulations, and guidance related to NEPA and this audit.

Public Law 91-190, “The National Environmental Policy Act of 1969,” as amended.

NEPA was the first major Federal environmental law enacted and is the basic national charter

for protecting the environment. The purposes of NEPA are:

To declare a national policy which will encourage productive

and enjoyable harmony between man and his environment; to

promote efforts which will prevent or eliminate damage to the

environment and biosphere and stimulate the health and welfare

of man; to enrich the understanding of the ecological systems

and natural resources important to the Nation; and to establish a

Council on Environmental Quality.

The intent of NEPA is to protect the environment. By requiring Federal agencies to gather

information about the environmental consequences of proposed actions and consider the

environmental impacts of those actions, agencies make wiser environmental decisions and keep

public citizens informed. Federal agencies’ must establish procedures that:

• Develop methods and procedures that will ensure that the environment is

considered in decisionmaking along with economic and technical considerations.

• Include an environmental impact statement in every major Federal proposal

significantly affecting the quality of the human environment.

40 CFR, Parts 1500-1508, “Council on Environmental Quality NEPA Regulations,”

last amended April 25, 1986. The Council on Environmental Quality, a council within the

Executive Office of the President, establishes regulations and reports to the President on the

nation's environmental status. The Council identifies the implementing NEPA regulations for all

Federal agencies by defining the levels of and timeframe for NEPA consideration and the

requirements for documentation. The core focus of the regulations is that agencies integrate the

NEPA process with other planning at the earliest possible time to ensure that decisions reflect

environmental values, avoid delays, and prevent potential conflicts. The regulations also

emphasize paperwork reduction, work delay reduction, agency coordination, and public

involvement.
26

Appendix D

14 CFR, Subpart 1216.3, “Procedures for Implementing the National Environmental

Policy Act,” last amended October 7, 1991. Subpart 1216.3 contains NASA's procedures

for implementing NEPA and supplements the Council's regulations. The procedures apply to all

NASA activities that may have an impact on the quality of the environment. Subpart 1216.3

states that potential environmental effects must be considered, along with technical, economic,

and other factors, in the earliest planning phase.

The procedural requirements of NEPA involve three levels: the categorical exclusion, the

environmental assessment, and the environmental impact statement. NASA activities may be

categorically excluded from the requirements to prepare either an environmental assessment or

an environmental impact statement if actions are:

. . . sub-elements of an approved broad-based level-of-effort NASA science and

technology program (basic research, applied research, development of technology,

ongoing mission operations), facility program, or institutional program; and . . . managed

relatively independently of other related sub-elements by means of separate task orders,

Research and Technology Operating Plans. . . .

Specific NASA activities that normally require an environmental assessment or are categorically

excluded are summarized in the following table.
27

Appendix D

Environmental Assessments versus Categorical Exclusions

As Defined in CFR 1216.3

Program/Activity Environmental Assessment

Normally Required

Categorically Excluded1

 Space Science Specific spacecraft development

and flight projects.

Research and Development (R&D)

activities 2 other than specific spacecraft

development and flight projects.

Space and Terrestrial

Applications

Specific spacecraft development

and flight projects.

R&D activities3 other than specific

spacecraft development and flight

projects.

Aeronautics & Space

Technology & Energy

Technology Applications

Specific experimental projects. R&D activities4 other than experimental

projects.

Space Transportation

Systems

Development and operation of new

space transportation systems and

advance development of new space

transportation and spacecraft

systems.

R&D activities in space transportation

systems engineering and scientific and

technical support operations, routine

transportation operations, and advance

studies.

Other Space Related Reimbursable launches of nonNASA spacecraft or payloads.R&D activities in space tracking and

data systems.

Facilities Major construction of facilities

projects.

Facility planning and design funding.

Minor construction of new facilities

including rehabilitation, modification,

and repair.

Institutional (Operations

at a NASA Installation)

Actions to alter ongoing

operations at a NASA Installation

that could lead, either directly or

indirectly, to natural or physical

environmental effects.

Continuing operations of a NASA

installation at a level of effort or altered

operations, provided the alterations

result in only social and/or economic

effects but not natural or physical

environmental effects.

1

These categories are excluded from the requirements for an environmental assessment or environmental impact

statement. Although an action may be categorically excluded from the need for an environmental assessment or

impact statement, the activity is not excluded from the environmental evaluation requirement.

2

Examples of these activities include Physics and Astronomy Research and Analysis, Planetary Exploration Mission

Operations, and Data Analysis.

3

Examples of these activities include Resource Observations Applied Research and Data Analysis and Technology

Utilization.

4

Examples of these activities include Research and Technology Base and Systems Technology Programs.
28

Appendix D

The Federal Acquisition Regulation, Part 7, “Acquisition Planning.” The FAR defines the

acquisition requirements for Federal agencies. Section 7.105(b)(16) requires that the acquisition plan:

Discuss all applicable environmental and energy conservation objectives associated with

the acquisition, the applicability of an environmental assessment or environmental impact

statement, the proposed resolution of environmental issues, and any environmentallyrelated requirements to be included in solicitations and contracts.

The acquisition plan links the work to the objectives; identifies decision milestones; and addresses all the

technical, business, management, and other significant considerations, including risks.

The NASA FAR Supplement, Part 1807, “Acquisition Planning.” Part 1807.105(a)(2) states that

NPG 7120.5 shall be an integral part of acquisition planning for programs/projects subject to the NPG

requirements. If the NPG does not apply, the acquisition plan shall clearly state that fact. If the NPG

does apply, the acquisition plan shall specify whether all required NPG 7120.5 documentation is current

and approved. All draft or final solicitations must clearly identify the program or project of which they

are a part.

NASA Policy Directive 8800.16, “NASA Environmental Management,” September 6, 1995.

The Directive states that compliance with environmental regulations and NASA policy is the

responsibility of every NASA employee. Because administration of this policy is a management

responsibility, NASA Strategic Enterprises and Program Offices are accountable for all environmental

considerations and are ultimately responsible for full environmental compliance.

Draft NPG 8840, “NASA Procedures and Guidelines for Implementing the National

Environmental Policy Act and Executive Order 12114,” most recent version dated

October 26, 1999. The NPG is a draft that is in final review. Once approved, it will replace NASA

Handbook 8800.11, dated February 1988. The NPG serves as a practical reference and source of

guidance for NASA managers in ensuring that their programs, projects, and activities are carried out in

compliance with the letter and spirit of NEPA and Executive Order 12114.

NPG 7120.5A, “NASA Program and Project Management Processes and Requirements,”

April 3, 1998. NPG 7120.5A covers the formulation, approval, implementation, and evaluation of

aerospace programs and projects. The NPG addresses the NEPA requirements as follows:
29

Appendix D

(a) The National Environmental Policy Act requires NASA program/project managers to

consider environmental impacts in the planning of Agency programs and projects that

may have a significant impact on the quality of the human environment, consider

alternatives to their proposed actions, and ensure compliance with other relevant

environmental statutes, regulations, and Executive orders.

(b) NASA program and project managers shall contact the environmental functional

offices to ensure implementation of NEPA requirements in accordance with NASA’s

policy and procedures (14 CFR Part 1216, NPG 8840, and Executive Order 12114).

In addition, Appendix E.4 of the NPG states that, "The required environmental assessment and

environmental impact statement for the project should be identified with the schedule for their

accomplishments."

NPG 8820.2B, “Facility Project Implementation Handbook,” April 25, 1997. NPG 8820.2B is

NASA's project management guidance for facility planning, budgeting, design, construction,

environmental compliance, and activation. The handbook's planning chapter explains how to

incorporate NEPA into the facility planning process. The handbook further addresses preparing the

environmental evaluation, assessment, and impact statements; identifying categorical exclusions; and

issuing a finding of no significant impact and a record of decision.
30

**Deliberative process information omitted.**
31

Appendix F. Management’s Response

See Appendix G,

OIG Comment 1

See Appendix G,

OIG Comment 2
32

Appendix F

See Appendix G,

OIG Comment 3
33

Appendix F
34

Appendix F
35

Appendix F
36

Appendix F
37

Appendix F

**Deliberative process information omitted.**
38

Appendix F

**Deliberative process information omitted.**
39

Appendix F

**Deliberative process information omitted.**
40

Appendix F
41

Appendix F
42

Appendix F
43

Appendix G. OIG Comments on Management’s Response

NASA management provided the following general comments in its response to our draft report. Our

responses to the comments are also provided.

Management’s Comment. The characterization at various points that there are NASA

programs/projects totaling about $3 billion at risk for failure to comply with NEPA is unfair,

inflammatory, and unsupported by the facts.

1. OIG Comments. The report states that 11 of the mission-related programs/projects reviewed,

totaling about $3 billion, were not in compliance with NEPA. We believe this is not an unfair

characterization. Our findings and conclusions are based on a thorough review of NASA

program/project files and related documents, which did not support that environmental impacts were

evaluated in compliance with NEPA. We also interviewed present and past program/project managers,

who stated for the most part, that that they were unaware of the NEPA and NASA requirements. In

our opinion, such a lack of awareness creates a major risk of NEPA noncompliance within NASA.

Because management has not provided us with evidence that our findings are invalid, we have not been

able to validate management’s comments specifically related to the 13 programs/projects. In fact, we

have reason to question management’s assertions for these programs/projects. For example,

management stated that a sizable portion of the Physics and Process Modeling project involved

mathematical modeling using computers. Our follow-up related to the project at Glenn contradicted

management’s response. After the audit, we contacted the initial project manager who stated that about

one-third of the project was for computer analysis, including the mathematical modeling, and two-thirds

was for testing in laboratories and test cells to validate the analysis. Additionally, we reviewed the

current project plan, which further supported that both analysis and actual testing had been performed.

According to NEPA and NASA guidance, this project must be evaluated for NEPA compliance.

Management’s Comment. There are several statements that NASA lacks effective NEPA guidance.

For the past 18 months NASA Centers have been told to essentially ignore NHB 8800.11, which was

outdated and ineffective. Instead, the Centers were told to use draft NPG 8840 as de facto guidance

prior to its issuance. The OIG found that the draft NPG 8840 covers virtually all the relevant elements

of NEPA guidance. It has been management's understanding that NASA Centers have been operating

in that de facto fashion.

2. OIG Comments. We agree that the draft NPG 8840 is a much improved and thorough

environmental document. However, the term NASA guidance refers to both CFR 1216.3 and the draft

NPG 8840. As stated in the report, the CFR is unclear and inadequate. In addition, guidance can be

effective only if implemented by NASA staff. We identified that mission-related program/project

managers and their overseers were not aware of the draft NPG 8840 or the requirements for evaluating

environmental impacts or NEPA compliance. We also found that the draft NPG has been disseminated

only to the Centers' environmental offices. However, the
44

Appendix G

NEPA process must be initiated by the program/project managers because the Center’s environmental

offices are often uninformed of new program/projects.

Management Comment. There is an implication that NASA presently has high litigation exposure.

The facts of the situation for the programs/projects reviewed in no way support that assertion.

3. OIG Comments. We disagree that the report implies high exposure to litigation associated with the

noncompliant programs/projects. The word litigation is used only once in the impact section of the

report. Further, the language in the report was excerpted from the draft NPG 8840. The report points

out that increased risks, including litigation, may exist when the NEPA process is not followed.
45

Appendix H. Report Distribution

National Aeronautics and Space Administration (NASA) Headquarters

A/Administrator

AI/Associate Deputy Administrator

B/Chief Financial Officer

B/Comptroller

BF/Director, Financial Management Division

G/General Counsel

H/Associate Administrator for Procurement

J/Associate Administrator for Management Systems

JM/Director, Management Assessment Division

M/Associate Administrator for Space Flight

R/Associate Administrator for Aero-Space Technology

S/Associate Administrator for Space Science

U/Associate Administrator for Life and Microgravity Sciences and Applications

Y/Associate Administrator for Earth Science

Z/Associate Administrator for Policy and Plans

NASA Centers

Director, John H. Glenn Research Center at Lewis Field

 Chief, Environmental Management Office, John H. Glenn Research Center at Lewis Field

Director, John F. Kennedy Space Center

 Chief, Environmental Program Office, John F. Kennedy Space Center

Director, George C. Marshall Space Flight Center

 Deputy Director, George C. Marshall Space Flight Center

 Manager, Environmental Engineering Department, George C. Marshall Space Flight Center

Non-NASA Federal Organizations and Individuals

Assistant to the President for Science and Technology Policy

Deputy Associate Director, Energy and Science Division, Office of Management and Budget

Branch Chief, Science and Space Programs Branch, Energy and Science Division, Office of

Management and Budget

Associate Director, National Security and International Affairs Division, Defense Acquisition Issues,

General Accounting Office

Professional Assistant, Senate Subcommittee on Science, Technology, and Space
46

Appendix H

Chairman and Ranking Minority Member - Congressional Committees and Subcommittees

Senate Committee on Appropriations

Senate Subcommittee on VA, HUD, and Independent Agencies

Senate Committee on Commerce, Science, and Transportation

Senate Subcommittee on Science, Technology, and Space

Senate Committee on Governmental Affairs

House Committee on Appropriations

House Subcommittee on VA, HUD, and Independent Agencies

House Committee on Government Reform

House Subcommittee on Government Management, Information, and Technology

House Subcommittee on National Security, Veterans Affairs, and International Relations

House Committee on Science

House Subcommittee on Space and Aeronautics

Congressional Member

Honorable Pete Sessions, U.S. House of Representatives
NASA Assistant Inspector General for Auditing

Reader Survey

The NASA Office of Inspector General has a continuing interest in improving the

usefulness of our reports. We wish to make our reports responsive to our customers’

interests, consistent with our statutory responsibility. Could you help us by completing

our reader survey? For your convenience, the questionnaire can be completed

electronically through our homepage at

http://www.hq.nasa.gov/office/oig/hq/audits.html or can be mailed to the Assistant

Inspector General for Auditing; NASA Headquarters, Code W, Washington, DC

20546-0001.

Report Title: Compliance With the National Environmental Policy Act

Report Number: Report Date: 

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y

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organized.

5 4 3 2 1 N/A

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3. We effectively communicated the audit

objectives, scope, and methodology.

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Thank you for your cooperation in completing this survey.
Major Contributors to the Report

Chester A. Sipsock, Program Director, Environmental and Financial Management Audits

Sandra A. Massey, Program Manager

James E. Richards, Auditor-in-Charge

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William R. Lester, Auditor

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