Massive spending bills authorized by Congress over the last two years have poured billions of dollars through federal agencies into state coffers, threatening to overwhelm the government inspectors charged with preventing fraud, waste, and abuse in the use of taxpayer money.
Inspectors general from three federal agencies and a director from the Government Accountability Office (GAO) told Congress that their offices are not fully equipped to oversee the huge increase in spending authorized by the Infrastructure Investment and Jobs Act (IIJA), CHIPS Act, and Inflation Reduction Act (IRA) at a hearing of the House Energy and Commerce Subcommittee on Oversight and Investigation on March 29.
“We’ve seen this before,” said Sean O’Donnell, inspector general at the Environmental Protection Agency.
“The equation of an unprepared agency dispensing an unprecedented amount of money, times a large number of struggling recipients, equals a high risk of fraud waste and abuse.”
The IRA pumped $60 billion into the EPA, the largest influx of cash in the agency’s history. The money is intended in part to fund water infrastructure projects, electric school buses, and cleanup projects.
Funds for those purposes are usually distributed through State Revolving Funds (SRFs), but O’Donnell doubted his office’s ability to properly oversee such a large influx of cash.
Staffing Problem
Despite some additional funding provided for oversight through the spending bills, the inspectors continue to see inadequate staffing as a problem.The CHIPS Act provided $25 million over five years to conduct oversight, and the IIJA provided $80 million for oversight of the broadband programs, according to Peggy Gustafson, inspector general at the Department of Commerce. She said her office had ramped up recruiting and retention as a result.
Other directors said they remain understaffed for the task at hand.
“We have been suffering for more than a decade under flat or declining budgets,” O’Donnell said. “Twelve years ago, we were funded for 355 full-time equivalents, and now we’re down to 270.”
The situation is similar at the Department of Energy, where Inspector General Teri Donaldson said the funding her office must account for has grown from $44 billion to $478 billion with the passage of these spending acts.
To manage that tenfold increase in workload, the IIJA provided $62 million and the IRA provided $20 million to oversee those programs for the next 10 years, which Donaldson says is not enough.
“My office faces an immediate funding shortfall of over $300 million as even a first installment to conduct appropriate oversight. So without additional funding, we will be stretched so thin that critical preexisting areas will not receive appropriate OIG (Office of Inspector General) oversight,” she said.
Joe Biden’s 2024 budget proposal does include an additional $165 million for Donaldson’s office, she said.
Mark Gaffigan, managing director of natural resources and environment at the GAO said his office remains understaffed despite some $30 million in additional funding provided by recent spending acts.
“When I started here in 1987, we had 5,100 FTEs. We went all the way down to 3,000,” Gaffigan said.
“We really need analysts to cover these things because, since 1987, work has not gotten easier and the programs have not gotten smaller,” he said.
Regardless of the challenges, all witnesses told the subcommittee that they intend to oversee the implementation of the spending laws with “full and robust efforts.”
“We want the states to know that we are their partners in helping to make sure that these things are executed appropriately, and we’re their partners in fighting fraud,” O’Donnell said.
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