Superfund: EPA Cost Estimates Are Not Reliable or Timely
AFMD-92-40
Published: Jul 01, 1992. Publicly Released: Jul 01, 1992.
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Highlights
GAO provided information on the Environmental Protection Agency's (EPA) Superfund Program, focusing on whether EPA reporting of Superfund's estimated funding is reasonable.
Recommendations
Recommendations for Executive Action
| Agency Affected Sort descending | Recommendation | Status |
|---|---|---|
| Environmental Protection Agency | To improve the usefulness of estimates to complete hazardous waste site cleanup, the Administrator, EPA, should require the Assistant Administrator for Solid Waste and Emergency Response to: (1) report the estimates in categories showing those currently on NPL, those to be added over a certain period, such as the next 10 years, and those to be added in the more distant future; (2) substantiate and document as reasonable, the factor used in preparing the estimates to reflect the growth in the cost of clean-up projects underway; and (3) use forecast management practices, such as identifying forecast errors, in developing the estimates. |
Closed – Not Implemented
EPA disagreed with this recommendation. However, EPA has indicated that it will: (1) review the idea of expanding the cost analysis to include future costs; and (2) begin summarizing cost growth analysis using a larger universe and continually update its cost growth assumption.
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| Environmental Protection Agency | To help ensure the reliability and timeliness of Superfund cost estimates, the Administrator, EPA, should provide CFO authority and responsibility, as envisioned in the CFO Act, for providing guidance on preparing the estimates and monitoring the results. |
Closed – Implemented
EPA agrees with the thrust of this recommendation and, in its CFO organization plan (revised June 1993), the Administrator provided the CFO authority to direct, manage and provide policy guidance and oversight of agency financial management activities and operations. Developing cost estimates is a financial management activity. EPA believes that to fully implement this recommendation would require a sophisticated cost accounting system. During fiscal year 1995, EPA completed the design, test, and implementation of a new cost accounting system. However, EPA does not expect agencywide use of the system to occur until later in fiscal year 1996.
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| Environmental Protection Agency | To help ensure the reliability and timeliness of Superfund cost estimates, the Administrator, EPA, should direct CFO to disclose in the Superfund financial statement overview, information on the estimated cost of hazardous waste site cleanup. |
Closed – Not Implemented
EPA agrees that reporting information on the estimated cost of hazardous waste site cleanup is an appropriate role for the CFO. However, EPA believes that it is first necessary for the agency to be able to develop reliable cost estimates which depends on having a cost accounting system that is in place and operating. Such a system became operational on October 1, 1995. Also, a new module is being developed to bring cost and program data together and is expected to be implemented in fiscal year 1996, if funds are available. EPA expects agencywide use of the new system to occur in fiscal year 1996 and reliable cost estimates to be available shortly thereafter.
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Topics
Agency reportsCongressional oversightCost analysisFinancial managementFuture budget projectionsHazardous substancesReporting requirementsStatistical methodsWaste managementCost estimates