Also, for some discretionary grants, EPA  negotiates work plans, which include estimated time frames and dollar  amounts for activities under the grant. EPA awards these grants for a  variety of activities, such as environmental research, training,  providing education programs, and cleaning up brownfields. EPA Manages Competition for Its Discretionary Grants through a Process Established by Its Competition Policy and Implemented by Program and Regional Offices

EPA manages competition for its discretionary grants through a process  established by its competition policy and implemented by its program and  regional offices, which fund activities related to their own programmatic  focuses. Under the competition policy, program and regional offices are to  advertise discretionary grant opportunities through announcements on  Grants.gov and other methods as appropriate; evaluate all applications  against eligibility criteria and all eligible applications against evaluation  criteria; and award grants. According to the competition policy and the Uniform Guidance, all  announcements must include the following eight sections:  1.  funding opportunity description, including the programmatic and  technical description with authorizing statutes and regulations and  clear examples of eligible activities;  2.  award information, including information about the expected number  of awards and award amounts;  3.  eligibility information, including information identifying the applicants  eligible to compete for awards and specific eligibility criteria;  4.  application and submission information, including a description of the  required content and format of the application and instructions on how  to apply;  5.  application review information, including specific ranking and  evaluation criteria and the relative importance assigned to them, such  as relative points, weights, percentages, or other means used to  distinguish them;  6.  award administration information, including notice to applicants of  EPA’s disputes procedures and other pertinent administrative  information;  7.  agency contacts, including a point of contact for answering questions  about the announcement; and  8.  other information, including any additional information that may be  helpful to applicants. EPA Provided Nearly $1.5 Billion in Discretionary Grant Dollars to a Variety of Grantees from Fiscal Years 2013 through 2015 and Competitively Awarded at Least 90 Percent of New Awards Subject to Its Competition Policy

From fiscal years 2013 through 2015, EPA provided nearly $1.5 billion in  discretionary grant dollars to about 2,000 unique grantees, including state  governments, nonprofits, Indian tribes, state universities, and local  governments, according to our analysis of EPA data. Of this total, $579  million was for new awards subject to the competition policy, and  according to EPA, the agency met its annual performance target to  competitively award at least 90 percent of these dollars or awards. More specifically, approximately $282 million was for  exemptions from competition, which are new awards that are not subject  to the competition policy, and about $632 million was for amendments to  awards that may or may not have been subject to the competition  policy. Three of these websites  are government-wide. Further, although CFDA.gov has a  search field for grant types and “discretionary grant” is a second-tier grant  type that users can choose to search for, EPA does not flag discretionary  grants in the information it submits for CFDA.gov. Under federal standards for internal  control, agencies are to communicate complete and accurate information  internally and externally to achieve the entity’s objectives. These officials expect the new system to be  fully operational in 2018. In addition to these steps, by having clear  guidance on identifying discretionary grants generally—such as how to  flag categorical grants with discretionary aspects and how to reconcile  inconsistencies among EPA’s two definitions of discretionary grants— staff might be able to better identify all discretionary grants in the internal  grants management system, especially discretionary grant programs  developed in the future. However,  the information EPA makes publicly available is neither easy to identify  nor complete. Until recently, EPA did not have complete information about which  of its grants are discretionary because staff were not consistently  distinguishing discretionary grants in EPA’s internal grants management  system. In addition, our review of EPA’s unofficial reports on grant competitions— the only publicly available source of information about the number of  applications received for discretionary grant competition opportunities— found that they are not current and they contain limited information. Although EPA is updating its internal grants management system with  capabilities to collect and report more timely and complete information  about discretionary grants, the agency has no plans to use the system to  improve the timeliness and quality of the grants information it makes  publicly available on its website. To better enable Congress and other decision makers to monitor EPA’s  management of discretionary grants, the EPA Administrator should direct  the Assistant Administrator for the Office of Administration and Resources  Management to direct the Director of OGD to determine how to make  more complete information on EPA’s discretionary grants publicly  available, such as by posting timely and complete reports on its website. GAO staff who made key contributions to this report  are listed in appendix VI. Appendix II: Objectives, Scope, and Methodology

In this report, we examine (1) how EPA manages competition for its  discretionary grants, (2) how much in discretionary grants EPA provided  from fiscal years 2013 through 2015 and to what types of grantees, and  how much of that was competitively awarded, and (3) what information  EPA makes publicly available on discretionary grants. To examine what information EPA makes publicly available on  discretionary grants, we reviewed relevant statutes and regulations,  EPA’s competition policy, and EPA’s procedures and guidance for making  information publicly available on grants.
Why GAO Did This Study

EPA annually awards hundreds of discretionary grants, totaling about $500 million. EPA has the discretion to determine grantees and amounts for these grants, which fund a range of activities, from environmental research to wetlands restoration. EPA awards and manages discretionary grants at 10 headquarters program offices and 10 regional offices. Past reviews by GAO and EPA's Inspector General found that EPA has faced challenges managing such grants, including procuring insufficient competition for them and providing incomplete public information about them. GAO was asked to review EPA's management of discretionary grants.
This report examines (1) how EPA manages competition for discretionary grants, (2) how much in discretionary grants EPA provided from fiscal years 2013 through 2015 and to what types of grantees, and (3) the information EPA makes publicly available on discretionary grants. GAO reviewed EPA's competition policy and guidance, examined internal evaluations of grant applications for competitions that were selected partly because they accounted for large portions of discretionary grant dollars, analyzed EPA data as well as information EPA made available on public websites, and interviewed EPA officials.

What GAO Found

The Environmental Protection Agency (EPA) manages competition for its discretionary grants through a process established by its competition policy and implemented by its program and regional offices. Under the policy, offices are to advertise discretionary grant opportunities on Grants.gov—a website for federal grant announcements—and may also advertise using other methods, such as trade journals and e-mail lists. The announcements must describe eligibility and evaluation criteria, and the process may be customized to assess (1) all applications against eligibility criteria and (2) eligible applications for merit against evaluation criteria. Under the policy, EPA established a Grants Competition Advocate, a senior official who provides guidance to and oversight of the offices. EPA officials said this position has been key to improving competition for discretionary grants.
From fiscal years 2013 through 2015, EPA provided nearly $1.5 billion in discretionary grants to about 2,000 unique grantees, with state governments, nonprofits, and Indian tribes receiving the largest shares, according to GAO's analysis of EPA data. Of the $1.5 billion, $579 million was for new grants subject to the competition policy, and according to EPA, the agency met its performance target to competitively award at least 90 percent of these new grant dollars or awards annually. Some discretionary grants are not subject to the competition policy for several reasons—for example because they are available by law only to Indian tribes. Of the remaining approximately $920 million, $282 million was for new grants not subject to the competition policy, and about $632 million was for amendments to existing grants, such as for added work.
Publicly available information from EPA about its discretionary grants is neither easy to identify nor complete. For example, different information about the grants, such as dollar amounts, is available at four federal websites; but three of these websites do not have a way to search all the grants, and the fourth cannot identify the grants because EPA does not flag them in its submissions to the website. EPA officials plan to better flag these grants in the future; however, to obtain complete information, users would still have to search several websites containing different parts of this information. Also, GAO found that the unofficial reports EPA makes publicly available on the number of applications received for its grant competitions contain limited information. Moreover, these reports are not current because EPA relies on manual processes to collect the information from its offices, which can cause reporting delays. Further, GAO found that although EPA's internal grants management system has a field for tracking grant types, a lack of clarity in EPA's guidance may contribute to EPA staff's inconsistent use of this field. Consequently, EPA cannot easily identify discretionary grants in its system or collect complete and accurate information on them. EPA is transitioning to a new system that is expected to be operational in 2018 and to provide the capability to collect more timely and complete information. However, EPA officials said they do not have plans to use the new system to improve their publicly available reports, which is inconsistent with effective internal and external communication suggested by federal internal control standards. More complete information could help Congress and other decision makers better monitor EPA's management of discretionary grants.

What GAO Recommends

GAO recommends that EPA develop clear guidance for tracking grants and determine how to make more complete information on discretionary grants publicly available. EPA agreed with GAO's recommendations.