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Highlights

GAO reported on whether value engineering (VE) could be used to achieve cost reductions for wastewater treatment plants funded by the Environmental Protection Agency (EPA) by extending VE to: (1) design plans of projects costing from $1 million to $10 million; and (2) construction through the use of construction incentive clauses. VE is a method of analyzing a product or service so that its function can be performed at the lowest possible cost without sacrificing overall quality.

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Recommendations

Matter for Congressional Consideration

Matter Status Comments
Congress should revise the Federal Water Pollution Control Act to require VE review on designs of wastewater treatment projects costing more than $1 million.
Closed - Not Implemented
The proposed Clean Water Act of 1986, which was vetoed by the President, did not contain provisions for VE reviews of projects costing more than $1 million.

Recommendations for Executive Action

Agency Affected Recommendation Status
Environmental Protection Agency 1. The Administrator, EPA, should revise regulations to require VE review on designs of construction grant projects costing more than $1 million.
Closed - Not Implemented
EPA does not intend to take action because it perceives the need for congressional direction on this issue.
Environmental Protection Agency 2. The Administrator, EPA, should revise regulations to make VE design study costs for projects costing from $1 million to $10 million eligible expenses of the construction grant.
Closed - Not Implemented
EPA believes the allowance for planning and design provided to grantees, based on a percentage of total project costs, reflects VE costs to the extent VE has been done in the past on projects costing $1 million to $10 million.
Environmental Protection Agency 3. The Administrator, EPA, should test the value of using construction incentive clauses by: (1) requiring their use for a period of time in EPA-funded wastewater treatment construction project contracts; (2) evaluating the results achieved; and (3) assessing whether such a technique is effective on a permanent basis in controlling costs.
Closed - Not Implemented
EPA does not intend to test the value of requiring construction incentive clauses because it believes voluntary efforts are more appropriate.
Environmental Protection Agency 4. The Administrator, EPA, should promote the benefits of identifying cost-saving measures through the use of construction incentive clauses among applicable EPA, state, and grantee staff and contractors during the test period.
Closed - Not Implemented
EPA does not intend to test the value of requiring construction incentive clauses because it believes voluntary efforts are more appropriate.
Environmental Protection Agency 5. If the results are positive, the Administrator, EPA, should require construction incentive clauses on a permanent basis.
Closed - Not Implemented
EPA does not intend to test the value of requiring construction incentive clauses because it believes voluntary efforts are more appropriate.

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