[House Hearing, 119 Congress]
[From the U.S. Government Publishing Office]
EXAMINING THE BIDEN ADMINISTRATION'S
ENERGY AND ENVIRONMENT SPENDING PUSH
=======================================================================
HEARING
BEFORE THE
SUBCOMMITTEE ON OVERSIGHT AND
INVESTIGATIONS
OF THE
COMMITTEE ON ENERGY AND COMMERCE
HOUSE OF REPRESENTATIVES
ONE HUNDRED NINETEENTH CONGRESS
FIRST SESSION
__________
FEBRUARY 26, 2025
__________
Serial No. 119-7
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Published for the use of the Committee on Energy and Commerce
govinfo.gov/committee/house-energy
energycommerce.house.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
59-886 PDF WASHINGTON : 2025
-----------------------------------------------------------------------------------
COMMITTEE ON ENERGY AND COMMERCE
BRETT GUTHRIE, Kentucky
Chairman
ROBERT E. LATTA, Ohio FRANK PALLONE, Jr., New Jersey
H. MORGAN GRIFFITH, Virginia Ranking Member
GUS M. BILIRAKIS, Florida DIANA DeGETTE, Colorado
RICHARD HUDSON, North Carolina JAN SCHAKOWSKY, Illinois
EARL L. ``BUDDY'' CARTER, Georgia DORIS O. MATSUI, California
GARY J. PALMER, Alabama KATHY CASTOR, Florida
NEAL P. DUNN, Florida PAUL TONKO, New York
DAN CRENSHAW, Texas YVETTE D. CLARKE, New York
JOHN JOYCE, Pennsylvania, Vice RAUL RUIZ, California
Chairman SCOTT H. PETERS, California
RANDY K. WEBER, Sr., Texas DEBBIE DINGELL, Michigan
RICK W. ALLEN, Georgia MARC A. VEASEY, Texas
TROY BALDERSON, Ohio ROBIN L. KELLY, Illinois
RUSS FULCHER, Idaho NANETTE DIAZ BARRAGAN, California
AUGUST PFLUGER, Texas DARREN SOTO, Florida
DIANA HARSHBARGER, Tennessee KIM SCHRIER, Washington
MARIANNETTE MILLER-MEEKS, Iowa LORI TRAHAN, Massachusetts
KAT CAMMACK, Florida LIZZIE FLETCHER, Texas
JAY OBERNOLTE, California ALEXANDRIA OCASIO-CORTEZ, New York
JOHN JAMES, Michigan JAKE AUCHINCLOSS, Massachusetts
CLIFF BENTZ, Oregon TROY A. CARTER, Louisiana
ERIN HOUCHIN, Indiana ROBERT MENENDEZ, New Jersey
RUSSELL FRY, South Carolina KEVIN MULLIN, California
LAUREL M. LEE, Florida GREG LANDSMAN, Ohio
NICHOLAS A. LANGWORTHY, New York JENNIFER L. McCLELLAN, Virginia
THOMAS H. KEAN, Jr., New Jersey
MICHAEL A. RULLI, Ohio
GABE EVANS, Colorado
CRAIG A. GOLDMAN, Texas
JULIE FEDORCHAK, North Dakota
------
Professional Staff
MEGAN JACKSON, Staff Director
SOPHIE KHANAHMADI, Deputy Staff Director
TIFFANY GUARASCIO, Minority Staff Director
Subcommittee on Oversight and Investigations
GARY J. PALMER, Alabama
Chairman
TROY BALDERSON, Ohio, Vice Chairman YVETTE D. CLARKE, New York
H. MORGAN GRIFFITH, Virginia Ranking Member
NEAL P. DUNN, Florida DIANA DeGETTE, Colorado
DAN CRENSHAW, Texas PAUL TONKO, New York
RANDY K. WEBER, Sr., Texas LORI TRAHAN, Massachusetts
RICK W. ALLEN, Georgia LIZZIE FLETCHER, Texas
RUSS FULCHER, Idaho ALEXANDRIA OCASIO-CORTEZ, New York
MICHAEL A. RULLI, Ohio KEVIN MULLIN, California
BRETT GUTHRIE, Kentucky (ex FRANK PALLONE, Jr., New Jersey (ex
officio) officio)
C O N T E N T S
----------
Page
Hon. Gary J. Palmer, a Representative in Congress from the State
of Alabama, opening statement.................................. 2
Prepared statement........................................... 3
Hon. Yvette D. Clarke, a Representative in Congress from the
State of New York, opening statement........................... 5
Prepared statement........................................... 7
Hon. Brett Guthrie, a Representative in Congress from the
Commonwealth of Kentucky, opening statement.................... 9
Prepared statement........................................... 10
Hon. Frank Pallone, Jr., a Representative in Congress from the
State of New Jersey, opening statement......................... 12
Prepared statement........................................... 14
Witnesses
Nicole N. Murley, Acting Inspector General, Environmental
Protection Agency.............................................. 16
Prepared statement........................................... 19
Answers to submitted questions............................... 106
J. Alfredo Gomez, Director, Natural Resources and Environment,
Government Accountability Office............................... 26
Prepared statement\1\........................................ 40
Answers to submitted questions............................... 110
Jonathan A. Black, Chief Advisor to the Inspector General,
Department of Energy........................................... 27
Prepared statement........................................... 30
Answers to submitted questions............................... 113
Frank Rusco, Director, Natural Resources and Environment,
Government Accountability Office............................... 38
Prepared statement\1\........................................ 40
Submitted Material
Inclusion of the following was approved by unanimous consent.
List of documents submitted for the record....................... 93
Article of February 23, 2025, ``Several administration officials
tell workers not to reply to Musk email,'' by Dan Rosenzweig-
Ziff, Hannah Natanson and Carol D. Leonnig, Washington Post.... 94
Report by Inclusiv, ``Background on the Clean Communities
Investment Accelerator Program,'' February 26, 2025............ 99
----------
\1\ The Government Accountability Office's Natural Resources and
Environment team submitted a joint prepared statement.
EXAMINING THE BIDEN ADMINISTRATION'S ENERGY AND ENVIRONMENT SPENDING
PUSH
----------
WEDNESDAY, FEBRUARY 26, 2025
House of Representatives,
Subcommittee on Oversight and Investigations,
Committee on Energy and Commerce,
Washington, DC.
The subcommittee met, pursuant to call, at 10:30 a.m. in
room 2322, Rayburn House Office Building, Hon. Gary Palmer
(chairman of the subcommittee) presiding.
Members present: Representatives Palmer, Balderson,
Griffith, Dunn, Weber, Allen, Fulcher, Rulli, Guthrie (ex
officio), Clarke (subcommittee ranking member), DeGette, Tonko,
Trahan, Fletcher, and Pallone (ex officio).
Also present: Representatives Carter of Georgia, Castor,
Dingell, and McClellan.
Staff present: Ansley Boylan, Director of Operations;
Jessica Donlon, General Counsel; Sydney Greene, Director of
Finance and Logistics; Christen Harsha, Senior Counsel;
Brittany Havens, Chief Counsel; Calvin Huggins, Clerk; Sophie
Khanahmadi, Deputy Staff Director; Brayden Lacefield, Special
Assistant; Kaitlyn Peterson, Policy Analyst; Kristen Pinnock,
GAO Detailee; Gavin Proffitt, Professional Staff Member; Kaley
Stidham, Press Assistant; Jake Tyner, Chief Counsel; Rasheedah
Blackwood, Minority Intern; Timia Crisp, Minority Professional
Staff Member; Austin Flack, Minority Professional Staff Member;
Waverly Gordon, Minority Deputy Staff Director and General
Counsel; Tiffany Guarascio, Minority Staff Director; Will
McAuliffe, Minority Chief Counsel, Oversight and
Investigations; Constance O'Connor, Minority Senior Counsel;
Christina Parisi, Minority Professional Staff Member; Harry
Samuels, Minority Counsel; Andrew Souvall, Minority Director of
Communications, Outreach, and Member Services; Caroline Wood,
Minority Research Analyst; and Tuley Wright, Minority Staff
Director, Energy.
Mr.Palmer. The Committee on--the Subcommittee on Oversight
and Investigations will now come to order.
The Chair recognizes himself for 5 minutes for an opening
statement.
OPENING STATEMENT OF HON. GARY J. PALMER, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF ALABAMA
Welcome to the first hearing of the Subcommittee on
Oversight and Investigations of the 119th Congress. I want to
start by saying that it is an honor to serve as the chairman of
this subcommittee.
Congress has an important oversight responsibility that
includes making sure our laws are working as intended and that
the Federal Government is using taxpayer dollars responsibly. I
look forward to working with my colleagues on both sides of the
aisle on this important endeavor.
Today's hearing is entitled ``Examining the Biden
Administration's Energy and Environment Spending Push.''
Moments ago I noted the importance of ensuring that the Federal
Government is being a good steward of taxpayer dollars. This is
critical, particularly in the context of the extraordinary
surge in spending and the explosion of new and expanded
programs at the Department of Energy and the Environmental
Protection Agency largely authorized and funded by the
Infrastructure Investment and Jobs Act and the Inflation
Reduction Act. The two laws provided supplemental
appropriations of 97 billion and 101.5 billion to DOE and EPA,
respectively.
As this subcommittee examined the last Congress, spending
large amounts of funding, particularly in short timeframes,
carries tremendous risk. For example, in the November 2024
report the DOE Office of Inspector General noted that the
Infrastructure Improvement and Jobs Act and the IRA and the
2023 omnibus appropriations law increased the DOE Loan Program
Office authority to nearly half a trillion dollars. This is
more than 23 times that of the program's portfolio balance as
of November 2021, when the Infrastructure and Investment and
Jobs Act was signed into law.
The situation only became more alarming as the Biden
administration raced to finalize loans and spend down available
grant funding in its final months. All three watchdog
organizations here today--the EPA OIG, DOE OIG, and the
Government Accountability Office--have reported on past
shortcomings within these agencies and risk factors for waste,
fraud, and abuse. These risks increased under past infusions of
funding, as agencies rushed to move large amounts of funding in
a short amount of time.
Unfortunately, history seems to be repeating itself, but we
have a chance to try to minimize the damage.
I want to emphasize that we are not insinuating that all
applicants and recipients are guilty of wrongdoing. Rather, the
sheer pace and volume with which this funding was awarded
raises questions and is worth a pause to evaluate whether the
appropriate due diligence was done to ensure taxpayer dollars
went to eligible parties, and the funds are being used
appropriately.
I thank our witnesses for being here and sharing their
expertise to guide and inform the committee's efforts to
identify potential misuse of Federal funds and ensure that
appropriate measures are taken, moving forward, to prevent
future misuse of funds. This hearing is only one step of many
to ensure that wasteful spending is curbed, and we hope to
continue our collaboration with the OIG, the GAO, and the
current administration to address the--this issue.
[The prepared statement of Mr. Palmer follows:]
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Mr.Palmer. I now recognize the ranking member of the
subcommittee, Ms. Clarke, for her opening statement.
OPENING STATEMENT OF HON. YVETTE D. CLARKE, A REPRESENTATIVE IN
CONGRESS FROM THE STATE OF NEW YORK
Ms.Clarke. Thank you very much, Mr. Chairman, and I am
honored to be sitting here for the first time as ranking member
of this subcommittee.
Needless to say, conducting meaningful, fact-based,
effective oversight is more important now, more than ever. So
it is baffling and concerning that we have our panel of
representatives from not one, but two separate Inspectors
General's Office, where the inspector general was fired as one
of Donald Trump's first Executive actions. And these inspectors
general were both appointed by Donald Trump in his first
administration. It is very telling that Donald Trump could not
even trust people that he himself appointed to stay quiet while
he and Elon Musk broke the Federal Government and violated the
law.
We should be having a hearing on the illegal and
unconstitutional steps that this administration has taken in
its first month. But instead, Republicans are beginning this
Congress with an attempt to smear investments that are
rebuilding domestic manufacturing and lowering costs for
working families. Last Congress, the Republican majority held
numerous similar hearings aimed at justifying cuts to crucial
investments in our communities, and it seems that they are back
at it in this Congress.
The hearing we should be having would examine how, in just
over 5 weeks as President, Donald Trump has thrown our country
into chaos. On his first day in office, Trump
unconstitutionally froze Federal spending across the Federal
Government, even though it is Congress that decides how Federal
money is spent, and not the President. He has ignored numerous
court orders requiring that funds be dispersed, and he has
empowered Elon Musk to make sweeping policy decisions at
agencies Musk has a personal financial interest in undermining.
He has also allowed hard-working career civil servants and
their families to be arbitrarily swept aside under the guise of
efficiency, when we all know that there is nothing efficient
about removing decades of hard-earned expertise and hollowing
out agencies that protect our health and well-being.
We are already seeing the effects of this lawlessness. For
example, one school district in Missouri that expected to have
students riding to school on new, American-made electric busses
is still waiting for their busses because of Trump's funding
freeze. That school planned to save millions of dollars by
switching to electric busses. Instead, they now face higher
costs and uncertainty about whether they will ever even receive
the busses they ordered.
In West Virginia a five-person nonprofit that had its award
frozen was forced to lay off staff that transports seniors to
lifesaving dialysis appointments.
Across the State line in Virginia, the funding freeze
forced community health centers to close, taking healthcare
away from entire communities.
Before the ink was even dry on Trump's funding freeze,
hundreds of residents in Huntsville, Alabama, saw their energy
bills jump by $100 despite promises that direct financial
assistance would not be affected.
Making matters worse, the Trump administration has actively
spread misinformation that exacerbates the chaos and confusion
his funding freeze has created. For example, after the White
House was ordered by the courts to lift its funding freeze, the
Trump EPA issued an internal memo directing staff to unfreeze
certain programs but has continued withholding funds under the
pretense of compliance reviews, in defiance of the court. That
is completely unacceptable.
The investments Democrats fought for in the Bipartisan
Infrastructure Law and the Inflation Reduction Act are helping
to revitalize domestic manufacturing and our reliance on
critical mineral supply chains controlled by our adversaries
and creating better-paying jobs for American workers. Thousands
of American energy and manufacturing jobs are now at risk of
disappearing, and the promise of thousands of future jobs is
fading.
Republicans have needlessly painted themselves into a
corner, promising massive cuts to programs in order to pay for
tax breaks for billionaires. To accomplish that, they have to
put our communities, our national security, American jobs, and
a cleaner future with lower energy costs on the chopping block.
We in Congress have a duty to the Constitution and to our
constituents. Committee Democrats are standing up for both by
demanding that the will of Congress be followed and that
programs benefiting our communities be implemented.
Donald Trump and Elon Musk must be accountable for the
suffering they are inflicting on American workers and working
families, and we cannot let them stand in the way of the better
future that DOE and EPA programs are set to deliver.
[The prepared statement of Ms. Clarke follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Ms.Clarke. With that, Mr. Chairman, I yield back.
Mr.Palmer. The chairman now recognizes the chair of the
full committee, the gentleman from Kentucky, Chairman Guthrie,
for 5 minutes for an opening statement.
OPENING STATEMENT OF HON. BRETT GUTHRIE, A REPRESENTATIVE IN
CONGRESS FROM THE COMMONWEALTH OF KENTUCKY
Mr.Guthrie. Thank you, Chairman Palmer, for bringing us
together on this important hearing, and I look forward to
working with this subcommittee as we work through this
Congress.
Last Congress, the committee and Government watchdogs
highlighted alarming developments as the EPA and DOE began
rolling out new and expanded programs in distribution--and
distributing funding. One program that encapsulates a lot of
our concerns with this new program is EPA's Greenhouse Gas
Reduction Fund. In April of 2024 the Biden administration
announced the awarding of $5 billion to the Coalition for Green
Capital. Yes, that's $5 billion. According to IRS tax forms,
this organization had revenue of less than $3.5 million in
2023.
Providing such a large infusion of capital, more than 1,400
times the organization's revenue in 2023, raises concerns, and
the ability of the organization to appropriately manage the
volume of funding is something we are going to look into, we
hope President Trump looks into. I am sure he will. I hope Elon
Musk looks into it. I will guarantee you this committee will
investigate this.
This is just one example where a large amount of funding
went into an organization that, based on the facts before us,
does not have a demonstrated history of managing such large
amounts of money.
The committee has highlighted some of the funding
recipients are led by political allies of the Biden
administration, raising questions over whether they were
rewarded funds because they were the most deserving applicant
or if funding decisions were driven by other factors.
Despite these concerns, in the final months of the Biden
administration there was a push to get money out the door as
fast as possible, potentially at the expense of proper due
diligence without the right safeguards in place. Today's
hearing continues our efforts to ensure that the people's money
is sound and we are not funding our foreign adversaries, that
we are safeguarding taxpayer dollars from self-dealing,
collusion, and fraud.
I will tell you, I do hope the Trump administration--I hope
DOGE looks into this. And like as I said, I will guarantee you
this is just the beginning of us looking into it.
[The prepared statement of Mr. Guthrie follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr.Guthrie. And I will yield to the vice chairman for the
remainder of my time.
Mr.Balderson. Thank you for your time, Chairman Guthrie. I
would also like to thank you and Chairman Palmer for holding
this hearing today.
It is vitally important that this subcommittee conduct
proper oversight of the billions of dollars spent on the
Democrats' Green New Deal policies over the last 4 years. The
infrastructure bill and the IRA provided approximately 100
billion in supplemental funding to the EPA. That is more than
10 times the funding level for the EPA's annual budget.
And just a month before President Trump took office, the
Office of the Inspector General for the Department of Energy
reported that the Department's Loan Program Office was
administering more than $385 billion in new loan authority
without an effective system in place to manage organizational
conflicts of interest. In fact, the OIG even recommended the
Department of Energy pause all of its loan and loan guarantee
reviews.
We have all seen the lengths that the Biden administration
went in order to hand out cash to far-left activist groups.
They even went so far as to give $2 billion to a group called
Power Forward Communities. This organization reported just $100
in revenue for the entirety of 2023, but President Biden's EPA
thought they were worthy of $2 billion in taxpayer dollars. I
am grateful that the Trump administration has taken action to
ensure we are properly reviewing the funding and loan programs
and root out waste, fraud, and abuse at the Department of
Energy and EPA.
I would also like to thank all of you for being here today,
and I look forward to hearing what you are doing to shine a
light on this spending spree.
Mr. Chairman, I yield back.
Mr.Palmer. The Chair now recognizes the ranking member of
the full committee, the gentleman from New Jersey, Mr. Pallone,
for 5 minutes.
OPENING STATEMENT OF HON. FRANK PALLONE, Jr., A REPRESENTATIVE
IN CONGRESS FROM THE STATE OF NEW JERSEY
Mr.Pallone. Thank you, Mr. Chairman. I have to say I am
genuinely shocked that we are having this hearing today. It was
talked about, self-dealing. When I go home, the only self-
dealing I hear about is--from my constituents is the self-
dealing by Elon Musk. If we were going to hear about self-
dealing, we certainly should hear about what he does and his
self-dealing.
I mean, Congress is often accused of being out of touch and
out of step with the American people, but this hearing is a
perfect example of that. At a time when President Trump and
Elon Musk are stealing funds approved by Congress for the
American people and indiscriminately firing inspector generals
and hundreds of thousands of public servants, Republicans are
holding a hearing today examining former President Biden's
energy and environment investments.
Now, the Republicans invited the Offices of Inspector
General for both the Department of Energy and the Environmental
Protection Agency, but the seats before us today would
traditionally be filed by the inspector generals of the two
agencies. After all, these are the Senate-confirmed officials
charged with ferreting out waste, fraud, and abuse in these
agencies. But they both cannot testify today because they were
fired by President Trump at the end of his first week in
office.
So Trump's purge of these inspector generals was illegal.
The law requires that Congress be notified before an inspector
general is terminated and that a justification be provided to
Congress in writing. The message from Trump's firing of these
two inspector generals and many others is clear. It is not that
he didn't like that--the particular people responsible for
looking for waste, fraud, and abuse--because he fired all the
IGs--it is simply that he doesn't think anyone should be
permitted to oversee the Federal Government while he is the
President of the United States.
And my Republican colleagues apparently agree. Their
silence in the face of the termination of so many inspectors
general and key Federal workforce speaks volumes. Earlier this
month we urged Republicans to hold a hearing on President
Trump's sweeping purge of IGs throughout the Federal
Government, but to date they have refused. And yesterday
committee Republicans opposed an amendment to the committee's
oversight plan to ensure the independence of inspector generals
so they can continue to fulfill their legal responsibility to
conduct nonpartisan and objective oversight.
And all of this Republican inaction demonstrates that
committee Republicans are simply paying lip service to
investigating waste, fraud, and abuse. They would rather play
politics than actually conduct productive oversight. In fact,
Republicans have wasted 2 years and held over 20 hearings
looking for any excuse to gut investments in American
manufacturing and workers. Today's hearing is Republicans'
latest attempt to smear programs that help American workers and
working families after they have failed to find any evidence of
waste, fraud, and abuse.
Now, while Republicans are playing politics, Democrats are
fighting to protect the historic investments we made through
the Bipartisan Infrastructure Law and the Inflation Reduction
Act. These investments are creating new, good-paying jobs,
lowering costs for American families, and improving our energy
security. They will improve our ability to outcompete China,
build our American manufacturing, and reduce our reliance on
supply chains controlled by America's adversaries.
This hearing is not about oversight or accountability.
Instead, it is another effort by Republicans to justify
stealing investments from American communities in order to pay
for tax cuts for billionaires and big corporations. They are
also pushing ahead with their attempts to strip healthcare away
from millions of Americans by cutting at least $880 billion
from Medicaid.
I firmly believe that this committee has an obligation to
conduct robust oversight of the agencies within its
jurisdiction. But with all the fires and chaos that Trump and
Musk are intentionally starting in these agencies, it is
ridiculous that this is what Republicans are choosing to
conduct oversight on today. So they remain complicit with their
silence, and we will keep calling it out.
[The prepared statement of Mr. Pallone follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr.Pallone. But with that, Mr. Chairman, I yield back the
balance of my time.
Mr.Palmer. We now conclude with the Member opening
statements. The Chair would like to remind Members that,
pursuant to the committee rules, all Members' opening
statements will be made part of the record.
We want to thank all our witnesses for being here today and
taking time to testify before the subcommittee. Each witness
will have the opportunity to give an opening statement followed
by a round of questions from the Members.
Our witnesses for today are Ms. Nicole Murley, acting
inspector general at the U.S. Environmental Protection Agency;
Mr. J. Alfredo Gomez, Director of Natural Resources and
Environment Team in the U.S. Government Accountability Office;
Mr. Jonathan Black, chief advisor for strategic planning and
program oversight, Office of the Inspector General at the U.S.
Department of Energy; and Mr. Frank Rusco, Director at the
Natural Resources and Environment Team in the U.S. Government
Accountability Office.
You are aware that the committee is holding an
investigative hearing and, when doing so, has had the practice
of taking testimony under oath. Do you have any objection to
testifying under oath?
The Chair then advises that you are under the rules of the
House and the rules of the committee, and you are entitled to
be accompanied by counsel. Do you desire to be accompanied by
counsel during your testimony today?
OK. In that case, if you would please rise and raise your
right hand, I will swear you in.
[Witnesses sworn.]
Mr.Palmer. We will now recognize Ms. Murley for 5 minutes
to give an opening statement.
STATEMENTS OF NICOLE N. MURLEY, ACTING INSPECTOR GENERAL,
ENVIRONMENTAL PROTECTION AGENCY; J. ALFREDO GOMEZ, DIRECTOR,
NATURAL RESOURCES AND ENVIRONMENT, GOVERNMENT ACCOUNTABILITY
OFFICE; JONATHAN A. BLACK, CHIEF ADVISOR TO THE INSPECTOR
GENERAL, DEPARTMENT OF ENERGY; AND FRANK RUSCO, DIRECTOR,
NATURAL RESOURCES AND ENVIRONMENT, GOVERNMENT ACCOUNTABILITY
OFFICE
STATEMENT OF NICOLE N. MURLEY
Ms.Murley. Good morning, Chairman Guthrie, Chairman Palmer,
Ranking Members Pallone and Clarke, and members of the
subcommittee. I'm Nicole Murley, the acting inspector general
of the Environmental Protection Agency and the Chemical Safety
and Hazard Investigation Board. Thank you for the opportunity
to testify today. I appreciate your longstanding support of the
EPA Office of Inspector General as we work to protect and
detect--prevent and detect waste, fraud, and abuse in EPA and
CSB programs and operations, and drive improvements in
efficiency and effectiveness.
In line with that mission today, I will discuss our
concerns regarding oversight of more than $40 billion the EPA
received under the Inflation Reduction Act. While the EPA OIG
has not received dedicated funding to oversee these programs,
we have observed trends in our ongoing oversight of the EPA's
Infrastructure Investment and Jobs Act operations as well as
our broader oversight work for which we forecast risks for IRA
funding.
The EPA OIG has repeatedly flagged systemic issues
regarding the Agency's internal controls, particularly data
quality and the management and oversight of Federal funding
recipients such as grantees. Two years ago we warned that these
issues could undermine the EPA's IIJA operations. And as I sit
before you today, those warnings have come to pass.
For example, last fall our office found that the EPA did
not take reasonable measures to verify the State-submitted data
it used to alert billions of IIJA dollars to States for lead
service line replacement. For two States alone, we identified
nearly $1 billion in questioned costs and funds put to better
use.
In another example, we found that the EPA did not
adequately monitor the deployment status and the use of over
$836 million of rebates for its 2022 Clean School Bus Rebate
program. Furthermore, although the deadline for completing the
projects was October 2024, as of February 2025 only 43 percent
of the busses funded by those rebates have been delivered to
schools.
Reviews of these programs yielded nearly $2 billion in
monetary impact. With our unique authority, our independence,
and our expertise, we are confident that we could bring the
same level of impact and oversight to the Agency's IRA
programs, and we believe the issues that we've observed in our
IIJA oversight are red flags for problems that could be lurking
in IRA programs where, from an oversight perspective, these
risks are magnified.
The IRA created a paradigm of new funding, new recipients,
new initiatives, and a more complex financial transaction
stream. In addition, most IRA funds have very tight expiration
dates. The Agency's push to meet those statutory deadlines
creates concerns regarding whether proper internal controls
have been employed to vet funding recipients and project
proposals, and to monitor recipient use and management of those
funds.
The risks are heightened by the fact that, unlike the IIJA,
the IRA does not include funding for EPA OIG oversight. We have
already received reports of waste, fraud, and abuse related to
IRA programs as well as allegations of retaliation from
whistleblowers coming forward to report these issues.
While we are tapping into our core budgetary resources to
investigate these complaints, without dedicated resources we
are limited in our ability to conduct a more robust oversight.
I deeply appreciate the ongoing efforts of both the House and
the Senate to secure dedicated resources for this crucial work.
In the meantime, we will strive to provide oversight within our
existing budget.
Early on we focused on prevention to help the Agency
consider safeguards from the outset, rather than scrambling to
recover mismanaged or misused money after the fact. We briefed
more than 1,000 EPA employees and stakeholders on fraud
prevention and mitigation strategies. We also raised questions
for the Agency to consider regarding due diligence reviews,
monitoring of grantees and subgrantees, and screening for
potential conflicts of interest.
With roughly 93 percent of the EPA's IRA funds obligated,
our focus is now detection. In addition to ongoing
investigative work, we will leverage data analytics to
proactively detect potential fraud. We've initiated an audit to
determine whether an EPA contractor that received $147 million
in IRA and IIJA-funded contracts has complied with Federal and
contract requirements, and our team is prioritizing additional
IRA oversight work focused on grantee and subrecipient capacity
and the EPA's vetting process for awards.
The examples I've shared today are a cautionary tale of
systemic issues reaching across EPA programs that we have noted
for years. With a vital mission to protect human health and the
environment, and more than 1 billion taxpayer dollars at stake,
it's essential to learn from the past. We are confident that,
with the continued support of Congress and the administration's
commitment to tackling waste, fraud, and abuse, we can help
make the EPA meaningful--help the EPA make meaningful
improvements.
Thank you, and I look forward to answering your questions
today.
[The prepared statement of Ms. Murley follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr.Palmer. The Chair recognizes Mr. Gomez for his opening
statement--or for his testimony.
STATEMENT OF J. ALFREDO GOMEZ
Mr.Gomez. Chairman Palmer, Chairman Guthrie, Ranking Member
Clarke, Ranking Member Pallone, and members of the
subcommittee, good morning. Thank you for the opportunity to
discuss our work on how the EPA is using over $100 billion
provided by the Infrastructure Investment and Jobs Act and the
Inflation Reduction Act.
The IIJA included over $60 billion for EPA. We have been
focused on the 50 billion that went to water infrastructure and
other investments. The IRA included about 41.5 billion in
funding for greenhouse gas reduction and other programs. This
new funding is a significant increase for EPA's average annual
budget of about $8.8 billion per year. My statement today is
based on several issued reports and on observations from our
ongoing work on how EPA is using and overseeing the IRA funds.
Specifically, my statement discusses the status of EPA's IIJA
water-related funds and the IRA funds.
The IIJA provided EPA with over 43 billion for State
revolving funds and an additional 7 billion for other water-
related investment. This funding is being allocated to the
States using formulas that are set in law, and this is the same
process that EPA uses to award baseline funds for the Clean
Water and Drinking Water State Revolving Fund programs. Through
these programs States can make loans for wastewater and
drinking water infrastructure projects. In our prior work we
have identified the need for better financial indicators that
show the growth of these programs and ensure the sustainability
of the funds.
Last year we also recommended that Congress consider
revising the formula for the Clean Water State Revolving Fund
program. The formula has not been significantly updated since
1987, when it was first put into place. A revised formula would
better align with the program's goals, and a panel of experts
we convened recommended a formula that is based on States'
clean water needs as well as population and poverty would be
better.
Now, switching gears, the IRA provided EPA with about 41.5
billion for grants and other investments to reduce greenhouse
gas emissions and enhance climate resilience. Our analysis of
provisional EPA data shows that the Agency obligated nearly all
of the funds, and about half was expended. The IRA directed EPA
to establish the--to establish several new grant programs and
support other efforts. The largest amount was the 27 billion
for the Greenhouse Gas Reduction Fund. To implement the fund,
EPA created a new program office and established three
subprograms.
The first subprogram is a $14 billion National Clean
Investment Fund--awarded these grants to three recipients to
establish financial institutions that provide financing for
low- and zero-emissions technology projects.
Now, the second subprogram is the 6 billion Clean
Communities Investor Accelerator, which awarded grants to five
recipients, provided funding and technical assistance to
community lenders in low-income and disadvantaged communities
for financing low-emission projects.
EPA officials stated that nearly all of the 20 billion for
these two subprograms has been obligated and expended by
depositing the funds with a commercial bank. This bank is
acting as EPA's financial agent, and is to provide commercial
banking and financial services for the awardees. While
financial agents have been used in other parts of the Federal
Government, this differs from EPA's customary funding model.
EPA also determined that it would need 74 full-time
equivalents to oversee the new program, and at this juncture it
has 38 total staff that oversee the grantees. EPA also has 20
grant specialists that help support this and other programs.
Now, similar to other grants, the Agency's oversight of these
grant recipients includes several reporting requirements--for
example, reporting progress on outputs and outcomes.
In summary, we have reported that there are risks involved
with major new programs, especially when funding is awarded on
a compressed schedule. At this point, EPA has stood up programs
and issued awards, and now their emphasis turns to monitoring
and overseeing those awards. Monitoring existing awards may
require different skills and expertise than evaluating award
applications. Our ongoing work will assess EPA's process for
making spending decisions and its oversight of these monies.
Chairman Palmer, Ranking Member Clarke, and members of the
subcommittee, this completes my statement. I'd be happy to
answer questions.
[The joint prepared statement of the Government
Accountability Office's Natural Resources and Environment team
appears after Mr. Rusco's oral statement.]
Mr.Palmer. The Chair recognizes Mr. Black for his
testimony.
STATEMENT OF JONATHAN A. BLACK
Mr.Black. OK, I think I've got a red light.
Chairman Palmer, Vice Chairman Balderson, Ranking Member
Clarke, and members of the subcommittee, my name is Jonathan
Black. I currently serve as the chief advisor to the inspector
general of the Department of Energy's Office of Inspector
General. My portfolio of work involves oversight over the
Infrastructure Investment and Jobs Act and the Inflation
Reduction Act and the various programs that the Department of
Energy has stood up for those Acts. Thank you for inviting me
to testify today on the oversight work that the Department of
Energy's Office of Inspector General is performing regarding
the Department's Loan Programs Office.
In July 2022 the OIG warned in a special report about the
risks for potential conflicts of interest and undue influence
in the LPO. Also, we raised concerns with fast-moving funds
before this very subcommittee in March of 2023. By my
accounting, the Infrastructure Investment and Jobs Act, the
Inflation Reduction Act, and the 2023 Consolidated
Appropriations Act authorized an estimated $385 billion of
expanded loan authority in the LPO.
I appear before you today to report that the OIG now
observes potential problems regarding, one, conflicts of
interest; two, accelerated loan closures; and three, concerns
identified in our loan file reviews.
One, the OIG reported that the LPO has not implemented
controls sufficient to properly manage organizational conflicts
of interest. This poses a significant risk for fraud, waste,
and abuse. The LPO contracts with more than 300 personnel to
assist with loan due diligence with expertise in legal,
engineering and technical market analysis, and finance and
credit. Also, prospective borrowers provide the LPO with third-
party expert reports covering the same subject areas. In the
OIG's December 2024 report we found that the LPO does not
ensure that contracting officers identify and evaluate
potential conflicts of interest for their third-party experts.
Proper management of conflicts of interest requires identifying
all parties involved in the process on both sides of the
transactions. Federal stewards have an affirmative obligation
to do so, but this was not done.
Also, the LPO did not ensure that the contracting officers
adequately track conflict of interest disclosures and waiver
requests and did not share and cross-check that information
with the appropriate parties across multiple divisions of the
LPO. Accordingly, the LPO appears to have functionally
abandoned any responsibility for neutralizing or mitigating
conflicts of interest.
Additionally, LPO's support service contractor was unable
to show the OIG records to indicate that it had provided
training to its due diligence experts as to what constitutes a
conflict of interest, what disclosures, what mitigation steps,
and what other measures may be needed. How can these outside
experts know what constitutes a conflict of interest if they
were not even trained on these requirements?
To their credit, the current Department leadership
acknowledges the risks associated with these issues that we
have identified and has paused all new loan closures and has
developed and begun to implement corrective action plans to
address the weaknesses identified in our December 2024 report.
Two, fast-moving funds. Between November 2024 and the first
three weeks of January 2025, the Department has accelerated the
approval of its loans, as shown in my written statement. To be
clear, during January and--December and January, LPO completed
$46 billion of new loans. The increase in pace underscores our
concerns about whether it is possible to conduct robust due
diligence to protect the tax dollars under such time pressures.
Three, the OIG has hired outside experts to help us review
two recently completed loan agreements. For both of these
projects LPO had hired its own outside experts to identify and
articulate serious red flags that they identified before the
loans were closed, including multiple major risks that call
into question the projects' financial and performance
viability.
Also, LPO employs certain risk mitigation strategy for
these major loans. One mitigation measure involves structuring
in guaranteed sales agreements in order to assure revenue for
the project. Other mitigation measures involve structuring and
construction contract terms and commitments that are written in
a way to help minimize the risk for cost overruns. For the two
projects we examined, LPO's own expert advisors duly identified
and called out the loan applicant's mitigation measures as
being insufficient, that may pose risks to the viability of the
financial side of the project, and these often covered only 25
percent or less of the needed revenue protection or cost
control.
Further, the mitigation measures were largely arranged with
related parties, oftentimes relying upon shaky financial
positions. In looking through the credit review board meeting
minutes, they indicate a willingness to approve loans despite
these risks. Also, we observed that the LPO did not update some
of their data and analysis for evolving market conditions and
changes in the political landscape that may inform the long-
term prospects for repayment of these loans.
In closing, I would like to recognize the bipartisan
efforts of this subcommittee to provide oversight for the
Department's Loan Program Office. Thank you for your continued
support for the independent oversight that the OIG does to
advance transparency and to prevent and detect fraud, waste,
and abuse. I appreciate the opportunity to testify, and I look
forward to your questions.
[The prepared statement of Mr. Black follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr.Palmer. The Chair now recognizes Mr. Rusco for his
testimony.
STATEMENT OF FRANK RUSCO
Mr.Rusco. Thank you, Chairman Palmer, Ranking Member
Clarke, and members of the subcommittee. Thank you for the
opportunity to speak about our work on DOE's IRA and IIJA
spending. My testimony today focuses on two DOE offices that
each received a lot of money from the IIJA and IRA.
DOE's Office of Clean Energy Demonstration, or OCED, was
created in 2021 and manages demonstration projects in eight
different areas, including hydrogen hubs, carbon capture and
sequestration, and advanced nuclear projects. The money funding
these projects came from the IIJA, about $22 billion, and the
IRA, about $5 billion.
Through September 2024, OCED had awarded almost $19
billion. Most of this went to four areas, including $10 billion
for industrial decarbonization and carbon capture projects, $8
billion for regional hydrogen hubs, and $1 billion for advanced
nuclear projects. Since October 2024, OCED approved another
$6.6 billion, mostly to hydrogen hubs and industrial
decarbonization processes.
Only a small amount of the committed money has actually
gone out the door, and the remainder will depend on projects
meeting milestones, including passing independent cost reviews.
The private-sector companies receiving these awards have a lot
at stake in ensuring their success because OCED money is
matched by private-sector partners.
When we audited OCED in 2023 and 2024, we found that the
office had adhered to a number of recommendations we had made
regarding past DOE carbon capture and advanced nuclear
demonstration projects. OCED also brought in a large number of
new employees and contractors from the private sector to build
the expertise to evaluate applications for awards. However, we
also found that OCED could improve its procedures by better
defining its goals and developing metrics to measure progress,
and by developing a strategic workforce plan to ensure it
maintains the right number of employees with the right skills
going forward.
DOE's Loan Programs Office, or LPO, oversees loans and loan
guarantees across five different programs, including auto
manufacturing, nuclear power, biofuels, and renewable power.
LPO first issued a loan in 2009 using money from the Recovery
Act. More recently, LPO received about $370 billion in loan-
making authority, most of it from the IRA; $290 billion of that
authority expires in 2026, and another 60 billion expires in
2028. In total, to this date, LPO has made loans or loan
guarantees equal to about $67.5 billion. Of that amount, 24.4
billion was awarded in the last quarter of 2024 and about 25
billion was awarded in January 2025 alone.
We will be conducting future work looking at the LPO's
overall processes, but I can say today that my biggest concern
for the LPO is the rapid and increasing pace of loans that were
issued in the last 4 months. As we have testified before to
this committee, we get concerned when agencies have a lot of
money to spend and a short amount of time to spend it. We will
continue to monitor both OCED and LPO going forward.
It is important to note that for both OCED and LPO awards,
the money typically goes out in tranches as projects
successfully pass milestones and meet financial viability
conditions set in the terms of awards. To make sure future
money is spent wisely, it is essential that both programs have
staff with the right skills to evaluate the milestones and
financial viability of projects that have already received
awards. Often this will require contracting out for expertise
that the agencies do not possess in the right quantities to
handle all the work.
In recent weeks both offices have lost staff and the
services of contractors as a result of resignations,
dismissals, and spending freezes. As we perform our ongoing
oversight, we will be evaluating how the offices respond to
these and other changes to ensure that further money to
awardees is spent wisely.
Thank you. I'll be happy to answer any questions the
subcommittee has.
[The joint prepared statement of the Government
Accountability Office's Natural Resources and Environment team
follows:]
[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
Mr.Palmer. Thank you for your testimony, and we will now
move into the question-and-answer portion of the hearing. With
that, the Chair recognizes the vice chairman of the committee,
the gentleman from Ohio, Mr. Balderson, for 5 minutes.
Mr.Balderson. Thank you, Mr. Chairman. Thank you all for
being here today.
It is clear that the Biden administration was trying to get
as much money out the door as possible before President Trump's
inauguration. For example, a senior Biden administrator--
official was quoted saying in early December of 2024 that the
administration was on track to exceed its goal of obligating
over 80 percent of available IRA grant funding by the end of
Biden's term. Moreover, former Secretary Jennifer Granholm was
quoted in October 2024 as saying that she is racing to commit
funding and get contracts signed.
Many of us are also familiar with the video in which a
special advisor for implementation within the Biden
administration's EPA was caught on camera saying that, ``It is
truly like we are on the Titanic. We are throwing gold bars off
the edge.'' The special advisor also said that they were
``trying to get this money out as fast as possible before they
come in and stop it all.'' It is clear from the video that the
individual was referring to the Trump administration.
Given these remarks--comments, excuse me--I want to focus
my questions on how the desire to push money out quickly
extended to DOE's Loan Programs Office. My questions will be
directed to you, Mr. Black.
Your testimony notes that between November 2024 and January
2025, the Department appears to have accelerated its processing
and approving of loan guarantees that were under review.
Specifically, as you stated, that--between December 2024 and
January 2025 the DOE Loan Programs Office completed loans worth
more than $46 billion. Your testimony also has a chart that
shows from March 2022 to August 2024 there were 5 loans closed
as compared to 20 loans closed in the last 5 months of the
Biden administration.
Your testimony notes that the increase in pace underscores
concerns about whether it is possible to conduct robust due
diligence to protect taxpayer dollars under such time
pressures. Can you elaborate on that statement?
Mr.Black. Certainly, yes. The numbers of loans closed, as
represented in the written statement, do indeed indicate that
there was a accelerated attempt to close those deals that were
under review by the LPO. The limited work that the Office of
Inspector General did on the two file reviews that we went to
so far in depth seem to indicate that there was a tolerance
that the LPO leadership had for accepting risk that may not be
fully protective of the taxpayer interests.
Mr.Balderson. Thank you. You also mentioned in your written
testimony that your office was looking into some of the risk
mitigation measures, or lack thereof--we have touched on that--
regarding two recently completed loans. I understand you cannot
discuss the specifics--cases under review, but can you
elaborate more on some of these risk mitigation strategies and
explain how pressure to expedite a loan or loan guarantee could
impact having the appropriate risk mitigation measures in
place?
Mr.Black. Certainly. One of the common things that the
large capital financing energy construction project industry
has is to try to write in guaranteed sales agreements--they
call them off-take contracts--to assure that the project that
is borrowing $1 billion or more has guaranteed accounts
receivable, guaranteed sales, so as to finance and service the
loan going forward. The more you can lock down as far as
revenue is concerned, the safer the project's financial
viability is, and the safer the taxpayer is protected from, you
know, risk of default.
Similarly, they have these risk mitigation measures
structured on the cost side, where they have construction
contracts, terms, and conditions that seem to lock down the--
and guarantee that cost overruns don't occur during
construction. And so this indeed was engaged in--these kind of
strategies were engaged in by the LPO. And--but for the two
files that we reviewed there, we found that there was very
minimal guaranteed sales agreements and very minimal cost
controls on the construction side to control costs.
Mr.Balderson. Thank you. A followup to that--and you have
answered some of this, but are there any other stages of loan
approval or negotiation processes that can be impacted by the
pressure to close loans quickly? And you have about 15 seconds.
Mr.Black. The due diligence process that the LPO goes
through is rather extensive. And they have some world-class
experts commenting to and helping the LPO with its decision-
making process. And our overriding concern is that the LPO may
not have given appropriate consideration to those results.
Mr.Balderson. Thank you very much.
I yield back, Mr. Chairman.
Mr.Palmer. The Chair now recognizes the distinguished
ranking member from New York, Ms. Clarke, for 5 minutes for her
questions.
Ms.Clarke. Thank you very much, Chairman, and I thank our
panel of experts for appearing here today.
In calling this hearing to criticize EPA and DOE programs,
Republicans are ignoring the extreme actions that this
administration has already taken to sabotage these programs and
prevent President Trump from being held accountable. We should
be hearing from the Senate-confirmed inspector generals for DOE
and EPA, but we are not because last month Donald Trump fired
them.
In the middle of the night and after less than a week in
office, Trump fired at least 19 inspector generals without
providing any notice or justification to Congress, as the law
requires. Trump had even handpicked the DOE and EPA inspector
generals before--excuse me--during his first administration,
making their removal even more absurd. My first question is for
Mr. Black.
I understand that the deputy inspector general, who would
normally step in as the acting IG, also left DOE OIG last week.
And I have been told that your last day with DOE OIG is this
Friday. Is that correct?
Mr.Black. That's correct.
Ms.Clarke. I have also learned that 39 DOE OIG staff chose
to take this deferred resignation program that was pressed on
them. This represents 13 percent of DOE OIG staff, including 5
senior executive staff. Is that also correct?
Mr.Black. Yes, your numbers are accurate.
Ms.Clarke. Thank you.
Ms. Murley, obviously, the former inspector general, Sean
O'Donnell, was unceremoniously fired by Donald Trump. But has
your office also experienced departures of personnel and hiring
challenges recently?
Ms.Murley. We have not experienced departure of personnel.
However, we had--I have the number--I think it's 32 individuals
in various stages of the hiring that were frozen as part of the
hiring action, and a total of 32 individuals--or 23 individuals
who responded to the deferred resignation program. And we're
still evaluating the impact of that on our ongoing work.
Ms.Clarke. Thank you. It is simply outrageous that the
committee Republicans have called today's hearing to attack
programs they have thoroughly investigated for years without
finding any evidence of wrongdoing, yet remain silent about the
immense risk being created by the Trump administration's all-
out assault on agency OIGs.
Inspector generals are taxpayers' watchdogs, rooting out
waste, fraud, and abuse at the agencies they oversee. It is
stunning and disgraceful to see Republicans turn a blind eye to
the fact simply because Donald Trump is the president.
Mr. Gomez, Mr. Rusco, GAO has previously raised concerns
about DOE's and EPA's workforce and whether there are enough
people to effectively manage programs at those agencies. Do you
think that the workforce reductions that are being reported
threaten DOE and EPA's ability to effectively manage programs
and ensure accountability?
Mr. Rusco?
Mr.Rusco. I do think that the agencies will have a
challenge to restructure how they do their work in order to
monitor the money that's out the door that they need to follow
to make sure that additional tranches of funding are issued in
a wise manner. So I do think they're going to have a challenge
there.
Ms.Clarke. Mr. Gomez?
Mr.Gomez. Yes, so we've done a lot of work looking at
grants management workforce. And as you know, EPA's--about half
of its budget goes to the States and Tribes in the form of
grants. And so it's really important to have the workforce,
right, that you need with the right skill set to oversee those
grants. And especially now with a large infusion of funds at
EPA and new programs and expanded programs, having the
workforce that you need to do the oversight is most important.
Ms.Clarke. Thank you.
The Trump administration is picking the pockets of millions
of Americans in Democratic and Republican districts. Every day
that goes by where the administration ignores court orders by
withholding award funds and another day--is another day that
America's progress is delayed. Handing out tax breaks to
billionaires at the expense of American workers hurts our
constituents and hurts our country.
Republicans need to stop sitting on the sidelines, stand up
for their constituents, and hold Elon Musk and Donald Trump
accountable. Regardless of what my colleagues on the other side
decide to do, I will always stand up for my constituents and
fight to hold this administration accountable.
With that, Mr. Chairman, thank you and I yield back.
Mr.Palmer. The Chair now recognizes the chairman of the
full committee, Mr. Guthrie----
Mr.Guthrie. Thank----
Mr.Palmer [continuing]. For 5 minutes for his questions.
Mr.Guthrie. Thank you. I can assure the committee that we
are going to investigate and look at waste, fraud, and abuse,
and we will be--I think we are beginning--this is just the
beginning hearing, I will tell you that.
And think about this. So you have the Greenhouse Reduction
Fund, $27 billion. There is the Coalition for Green Capital
that we said the year before that has had--$3.5 million is what
we could find in their income. They get a $5 billion grant.
That's facts, that is not making anything up. And if you don't
think we should look into a $3.5 million company getting $5
billion worth of income--and then--so then--so they announce on
January the 22nd it was providing 200 million of its 5 billion
to a company called GreenieRE. Based on the State of Vermont
records, an organization with this name was recently
incorporated in October 2024, only a few months after EPA
selected the Coalition for Green Capital to receive its award.
According to GreenieRE's website, one of the organizations
initially behind its formation was the Coalition for Green
Capital.
So the Coalition for Green Capital is a $3.5 million
company, gets $5 billion. GreenieRE is incorporated in October
of 2024, and they have on the website that one of their--
initially behind their--the Coalition for Green Capital is
behind their organization. I am concerned about what this
brings, what this is. I have just described raises--the process
I just described raises questions about how EPA has been
monitoring their program.
So Ms. Murley, your written testimony notes that effective
monitoring of grant or loan recipients and subrecipients is a
critical internal control for grant-making agencies like EPA.
Based on examples like the one I just provided, your knowledge
of recipient and subrecipient relationships, and EPA's grant
management practices, what is--are EPA's OIG's concerns with
recipients' ability to monitor subrecipients, particularly when
the subrecipients have a relationship with the recipient?
Ms.Murley. So we--our concern is--and it's been a
continuing concern of grants management in looking at the
capacity of the recipients and the subrecipients to handle the
money that they've been given. And I think what you're talking
about is due diligence and conflicts of interest in grants or
other programs, which is certainly something that we are
interested in looking into.
I'm not sure I understand the question about the
subrecipients.
Mr.Guthrie. Well, the subrecipients--if it is a creature of
the recipient, and the subrecipient is--do you have concerns
with that?
Ms.Murley. Under that fact it would be something we would
look at for due diligence checks from the agency and how they
were--how the recipients of the money was vetted, and also the
controls that were put into place before the vetting went out.
What rules were put into place, what parameters, what
guidelines? That would definitely be something--
Mr.Guthrie. Would you be concerned that in October of last
fall a company was incorporated and all of a sudden they are
getting a $200 million grant? Would that be something that
would flag--
Ms.Murley. If that was the evidence that was presented,
that would be a concern. That would be a risk.
Mr.Guthrie. So let me go to Mr. Gomez.
Relatedly, I am also concerned about the oversight
conducted of recipients and subrecipients to ensure they are
meeting performance goals. Your written statement noted that
EPA officials said they had not yet developed program-level
performance goals and measures for the three subprograms of the
Greenhouse Gas Reduction Fund, and they need 1 to 2 years
before doing so. With no program level--so in your experience
evaluating grant and other financial assistance programs, is it
typical for a program to not have performance goals or measures
for years?
Mr.Gomez. No, it's not typical. I mean, generally with new
programs, they're trying to figure out, first of all, what
they're going to accomplish, what the goals are for it. And so
they take sometimes a little while to set up those performance
goals and measures. But those are important.
I mean, our job, obviously, is to follow the money, right?
So we want to make sure that the money is accountable, whether
it's going to the grantees or subgrantees or, at the end, maybe
the beneficiaries. So understanding what that process is,
looking at what controls are in place, what reporting
requirements to make sure that you're safeguarding against----
Mr.Guthrie. Would you be extra concerned if an entity had a
$3.5 million revenue, got a $5 billion grant, a company was
created that had a--I forget, I think it was a--just created in
October of 2024 and then got a $200 million grant that was a
subrecipient of that company?
Mr.Gomez. I mean, I think it would raise a flag for us
because we'd want to ensure that that company now that has a
large infusion of funds, is it structured, right? Does it have
the people to carry out the work? And is it going to be able to
carry out the terms and conditions, for example, of that grant
or that award?
So those would be things that we would be looking at in our
reviews, right?
Mr.Guthrie. I appreciate it, and we are going to be--my
time is expired, but we will be looking at that as--so thank
you for that.
I yield back.
Mr.Palmer. I thank the gentleman. The Chair now recognizes
the ranking member of the full committee, Mr. Pallone, for 5
minutes for his questions.
Mr.Pallone. Thank you, Chairman.
In less than 2 months, we have watched Elon Musk and
President Trump brazenly try to circumvent any check on
executive power and eliminate independent oversight, and
congressional Republicans have been silent.
At the Department of Energy, as many as 2,000 career staff
were suddenly fired without warning, including staff
responsible for our nuclear stockpile and others from offices
that were responsible for managing loan and grant programs. And
the same scene played out at EPA with hundreds of staff
suddenly fired or put on leave, including career staff with
decades of experience monitoring EPA programs.
And then, over the weekend, Federal workers received the
latest in a series of abusive mass emails from Elon Musk, this
one directing recipients to respond with a list of what they
did last week by Monday at midnight, otherwise they would be
terminated. And that, of course, sparked further confusion.
I ask unanimous consent, Mr. Chairman, to enter an article
from the Washington Post about this latest Musk email, if I
could. I will give you a copy of it.
Mr.Palmer. Without objection, so ordered.
[The information appears at the conclusion of the hearing.]
Mr.Pallone. Thank you. So I want to ask each of the
witnesses a simple question: Could the broad and sudden
termination of so many career officials risk impairing EPA or
DOE's ability to effectively oversee awards and loans?
Ms. Murley?
Ms.Murley. The grants capacity of the Agency to oversee its
grants and management, we actually have a report that will be
coming out talking about the Agency's capacity to manage its
grants. And so, yes, that would be a concern.
Mr.Pallone. Thank you. And Mr. Black, let me--I know it is
your last week, and so I want to thank you for your service.
But if I could ask you that same question. You want me to
repeat it or you----
Mr.Black. No, no, I understand the question. I think that
reductions of that magnitude would certainly have some impact
on the program's ability to effectively conduct its work, and
it will perhaps slow work down in order to do a quality job.
Mr.Pallone. Thank you.
And Mr. Gomez?
Mr.Gomez. Yes, so our past work on that subject shows that
you need the right staff with the right skill set in the right
places.
Mr.Pallone. Thank you.
Mr. Rusco?
Mr.Rusco. Yes, I can give you a specific example. In the
Office of Clean Energy Development, among the things that
happened in the last few weeks was a funding freeze coincided
with a renewal of a contract with a key private-sector company
that was going to do independent cost analysis for ongoing
projects. If those don't happen in, you know, in a timely
fashion, then either money goes out the door that didn't have
that review, or projects that the private sector spent a lot of
money on could be delayed or canceled. So it is troubling.
Mr.Pallone. Thank you.
And Mr. Black, let me go back to you. DOE OIG has
specifically highlighted the workforce concerns that DOE's
Office of the Inspector General previously identified at the
Loan Program Office that could hinder the office's ability to
move from a posture of evaluating applications and closing
loans to one focused on postclosure monitoring of finalized
loans.
Now, earlier this month, 45 staff at the Loans Program
Office were suddenly terminated. Are you concerned that these
terminations could negatively impact oversight and management
of portfolio loans and loan guarantees?
And what would even greater losses in workforce mean for
oversight and accountability, if you will?
Mr.Black. Certainly, reductions of staff at the LPO would
absolutely have some impact on their ability to process loan
applications and would certainly have some impact on the
ability to monitor those loans over time.
Mr.Pallone. And then lastly, the administration's arbitrary
and senseless cuts to our Federal workforce are making it
harder for DOE and EPA to oversee the grants and loans
Republicans pretend to be so concerned about. If Republicans
were serious about protecting taxpayers and fighting waste,
fraud, and abuse in grant programs, they would be holding the
administration accountable by doing real oversight work instead
of smearing award recipients who are just trying to build a
better future for this country. That is my opinion.
I don't have another question, but I just, you know, again,
as I said, I can't believe the focus of this hearing today. It
is not what I am hearing at home. When I go home, everyone is
worried about freezing of funds, termination and firing of
people, tariffs. I mean, people are genuinely concerned that
these Trump policies are going to lead to a recession. That is
what they are telling me. You know, the market is going up and
down, retail sales are down at an all-time low. I am just
afraid--and this is what I am hearing--we are headed towards a
recession with these Trump Republican policies. And I hate to
say that because that is not what I want to see.
I yield back, Mr. Chairman.
Mr.Palmer. The Chair now recognizes the gentleman from
Virginia, Mr. Griffith, for 5 minutes for his questions.
Mr.Griffith. Thank you very much, Mr. Chairman, and I just
have to say that in my district people have been concerned for
decades about money being spent in Washington, DC, that they
don't understand why it is being spent and they don't
understand how it costs so much money to do the things that
they probably could do themselves a lot cheaper. So I am
hearing different things than my good friend Mr. Pallone is
hearing.
Now, let me start off on this hearing and say that I am
proud of the work that this subcommittee did last Congress to
oversee the implementation of the Clean School Bus Rebate
program. Additionally, I will say electric busses work for some
schools, but this program was a setup--was set up in a
haphazard way, and in some cases, school districts have not
received all the busses they paid for.
Ms. Murley, as your office has since completed additional
work on the program, can you provide any updates on EPA's
efforts to appropriately monitor recipients' use of rebate
funds?
Ms.Murley. Yes. As a result of our 2022--or our report on
the 2022 rebate program, when they did do a second round of
rebates they put in more internal controls on the recipients'
use of those funds compared to what they had done in 2022,
which is not put any controls on the recipients' use of those
funds.
Mr.Griffith. And what happens when you don't put any
controls on the recipients' use of funds? A lot of it gets
frittered. I won't use ``waste, fraud, and abuse'' because my
colleagues on the other side hate that term, but it gets
frittered away, does it not?
Ms.Murley. The risk is there, it creates----
Mr.Griffith. Yes, it is substantial, wouldn't you agree?
Ms.Murley. Yes. It's a risk situation when you have no
restrictions on the funds and----
Mr.Griffith. Oh, come on.
Ms.Murley [continuing]. They sit in accounts for a while,
or they're commingled--
Mr.Griffith. You can say there is substantial risk. Come
on, you can say it.
Ms.Murley. There is substantial risk.
Mr.Griffith. All right. And is your office specifically
aware of the Lion Electric case, where the electric bus
manufacturer is now bankrupt?
Ms.Murley. And we have seen the news reports and share the
concerns reported. We don't comment--we have a longstanding
policy of not commenting or confirming on investigations. Thank
you.
Mr.Griffith. I appreciate that. I mean, that tells me there
is an investigation. I am pleased.
From an auditing methodology standpoint, can you help me
understand how the use of rebates--and maybe it is different
when you have substantial controls--but how the use of rebates
makes organizations, agencies, et cetera more vulnerable to
having problems similar to the Lion Electric situation?
Ms.Murley. So the use of rebates does--is different,
obviously, from putting out a grant. And grants are
longstanding vehicles for getting money to recipients, so they
have more controls in place. There's rules, they're written up
front, they're standard.
The rebate program was new, a new way of getting out
funding for the Clean School Bus program. And so it increased
the risks because it doesn't have the same level of internal
controls that a grant would have.
Mr.Griffith. All right, I appreciate that. In your
testimony talking about the Clean School Bus Rebate program you
state, ``Although the deadline for completing projects was
October 2024, as of February 2025 only 43 percent of the busses
funded by the 2022 Clean School Bus Rebate program have been
delivered to the schools.'' Is your office aware of any other
issues that have contributed to so many of the busses not yet
being delivered and recipients missing the deadline?
Ms.Murley. I don't have that information today, but I'd be
happy to submit it for the record.
I do know that we have a continuing audit work related to
the Clean School Bus program and oversight of the grant
programs established there.
Mr.Griffith. Now, I know you can't talk about ongoing
investigations, but do you have any idea or any information you
can share--and I will open it up if somebody else has
information to share--on what happens to the school systems
that were using Lion Electric--fortunately, none of those are
in my district, but that were using the Lion Electric? Because
now they can't get service, can't get parts, and they basically
have useless hulls, as I understand it from media reports. Do
you have any additional information?
Ms.Murley. I do not.
Mr.Griffith. All right. Does anybody else on the panel have
any information on that particular subject matter?
All right. Well, this is why we have these hearings, so we
can identify problems. And we will probably come back and ask
additional questions at a later date.
At this moment, Mr. Chairman, I yield back.
Mr.Palmer. I thank the gentleman. The Chair now recognizes
the gentlewoman from Texas, Mrs. Fletcher, for 5 minutes for
her questions.
Mrs.Fletcher. Well, thank you so much, Chairman Palmer. I
am glad to work with you and everyone here on this important
subcommittee in this Congress, and I think the testimony this
morning has been useful and important. And certainly, we are
addressing things of great concern to all of us.
I think all of us are concerned about ensuring that our
Government functions efficiently, effectively, and ethically,
and that is why we appreciate the work that the Office of
Inspectors General do in each of our agencies and departments,
and the work that you do to ensure that efficiency from the
Government Accountability Office, as well.
Certainly, I want to associate myself with the comments of
our chairwoman--I mean, of our ranking member on my side of the
aisle and with our ranking member of the full committee, Mr.
Pallone, about the concerns that I am hearing at home in my
district from my constituents about recent actions that have
not demonstrated either efficiency or effectiveness or ethical
and responsible governance, and that there is a great deal of
concern. And so I want to ask a few questions about that and
kind of go straight to them.
I want to start with you, Ms. Murley. Recently, at the
direction--at the behest of President Trump and Elon Musk, the
EPA in region 6, which is my region, decided to place every
NEPA permit reviewer on administrative leave. So for Texas,
Arkansas, Louisiana, New Mexico, and Oklahoma, there are no EPA
employees to do NEPA reviews at this time.
As I think everyone knows, this is a hub for energy and
infrastructure projects in this office with those States and 66
Tribal Nations. Do you expect that this will impact EPA's
ability to carry out its statutory responsibilities under NEPA
if we have no people who can review NEPA permit applications,
perform NEPA reviews?
Ms.Murley. I think that's a question better directed to the
Agency, but I will say that we have concerns about the
workforce planning and the amount of people available to do the
work of the Agency.
Mrs.Fletcher. Thank you for that.
I think that ties into something, Mr. Gomez, that you
talked about in your testimony. In your written testimony you
talk about several GAO recommendations to address workforce
challenges at EPA, specifically in EPA grants management, and
they included persistent staffing level declines and burnout
that was causing high turnover. And so I think that sounds
consistent with what I am hearing from Ms. Murley about
staffing concerns at EPA.
Would you agree with me that arbitrary firings will
negatively impact EPA's ability to implement those GAO
recommendations?
Mr.Gomez. I mean, I think we would look at, you know, where
those firings are taking place, and what those--what the roles
of those people are, and whether they are sort of in the front
line of implementing recommendations. So, you know, if it's
across the board, then it's having impacts in various programs.
So--and so, yes, if it's in those areas where people need
to take action, then that--we may need to be--or we may be
waiting to--for folks to take that action.
Mrs.Fletcher. Well, and I guess maybe more broadly my
question would be, I mean, certainly you would agree with me,
if you were concerned about employee retention, employee
morale, that arbitrary firings, threats to employees, abusive
treatment of employees are problematic for employee retention
and carrying out the efficient administration of the Agency's
responsibilities.
Mr.Gomez. I would agree, yes.
Mrs.Fletcher. OK. And I want to talk about one other thing
with the time I have left.
Mr. Black, you spent a lot of time in your testimony
talking about conflicts of interest. And I think it is really
important that you raise that. And I am going to ask you for
the record to explain, generally, kind of why conflicts of
interest are problematic and of concern to you. But for our
purposes here, would you agree with me that Federal conflicts
of interest statutes and financial disclosure requirements are
important?
Mr.Black. Yes, absolutely.
Mrs.Fletcher. And Federal officers are prohibited from
participating in Government matters that affect their financial
interests, correct?
Mr.Black. That is my understanding, yes.
Mrs.Fletcher. And senior Federal officers are also required
to publicly disclose their assets, liabilities, income, other
financial information so that the public can know whether they
are complying with those conflict of interest rules?
Mr.Black. That's correct.
Mrs.Fletcher. OK. And so I am out of time here, and I will
just say that certainly my constituents are deeply concerned
about the kinds of things that we are seeing and the conflicts
of interest that are emerging and quite clear in the Department
of Government Efficiency.
Mr.Palmer. The gentlewoman's time has expired.
Mrs.Fletcher. With that, I will yield back. Thank you.
Mr.Palmer. The Chair recognizes the gentleman from Texas,
Mr. Weber, for 5 minutes for his questions.
Mr.Weber. Thank you, Mr. Chairman.
Texas is leading the way to unleash American energy by
accelerating the deployment of new nuclear energy. X-energy,
one of the Department of Energy's Advanced Reactor
Demonstration Program's--ARDP--awardees, which was created by
the Trump administration, has partnered with Dow Chemical to
supply heat and electricity for their facility on the Texas
Gulf Coast, just south of my district. Wasteful spending at the
Department of Energy could go towards innovative American
nuclear projects like this one that actually give taxpayers a
return on their investment.
Mr. Black, I am coming to you. How will the
administration's Department of Energy support programs like the
ARDP to ensure that they are successful in advancing the next
wave of nuclear energy? I know you are leaving, but----
Mr.Black. Yes. Unfortunately, I didn't come prepared to
talk about the advanced nuclear energy program. Rather, my
statement was prepared for the Loan Programs Office.
Mr.Weber. OK.
Mr.Black. So I don't have any particular details to share
with you about anything about the advanced nuclear.
Mr.Weber. Ms. Murley, do you have any details on that?
Ms.Murley. I do not.
Mr.Weber. Gomez, Mr. Gomez?
Mr.Gomez. I would defer to our director on energy, Frank.
Mr.Weber. Frank, you are up.
[Laughter.]
Mr.Rusco. Thank you. Well, Congress does appropriate money
to the Office of Nuclear Energy, and also there is some money
in the Office of Clean Energy Development for nuclear projects.
So I guess, yes, it would be incumbent on Congress to
appropriate money specifically to support new nuclear
technologies, and I think that's a--would be well warranted.
Mr.Weber. Taxpayers are helping fund these innovative
projects. But it is unfortunate that, with the Biden DOE and
EPA, one hand has--apparently, the left hand has not been
talking to the right hand. I guess that is an appropriate
political term, is it not?
And so these CCS projects depend on access to carbon
storage infrastructure and the ability to acquire an EPA class
6 permit in a timely fashion--and key word there, ``timely.''
Meanwhile, as the EPA was all hands on deck, shoveling billions
of wasteful green spending out the door, they neglected to do
their actual job here.
The Trump administration has now inherited a backlog--are
you ready for this--of over 160 permits. Did you all know that?
Did you know that, Ms. Murley?
Ms.Murley. I knew there was a--we have ongoing work in the
class 6 wells program, looking at the EPA's ability to meet its
timelines and goals in permitting and getting permits for those
wells.
Mr.Weber. Mr. Gomez, were you aware of that?
Mr.Gomez. I was not aware of that number, no.
Mr.Weber. Mr. Black?
Mr.Black. No, sir. That is not information that I've done
oversight work on.
Mr.Weber. Frank? Mr.--is it ``Roo-sco?'' ``Russ-co?''
Mr.Rusco. ``Russ-co.''
Mr.Weber. Yes, OK. He kind of outed you.
Is that a concern, Mr. Gomez, that--all of the backlog of
these permits?
Mr.Gomez. Yes. I think, as we were talking earlier, right,
is that the backlogs can have an impact, right?
And, you know, Frank was providing earlier an example of
how not getting the reviews done can have impacts down the
line, so----
Mr.Weber. Mr. Black, impact?
Mr.Black. Yes, we have not done oversight work on NEPA
applications at all lately, so I can't----
Mr.Weber. Can you define lately for me? Last 6 weeks? Six
months? Six years?
Mr.Black. That I'm aware of, it is the--yes.
And let me be clear. So I don't represent the OIG as a
whole. I came here prepared to talk about the oversight work
that the DOE OIG does with regard to the Inflation Reduction
Act and IIJA Act. I can say that, in my purview, in my
portfolio of work, we have no ongoing work on NEPA applications
and siting.
Mr.Weber. Mr. Rusco?
Mr.Rusco. We don't have ongoing work in that. We have
recognized for years and years that permitting is a huge
challenge, and so being able to do NEPA analysis in a timely
fashion is important.
Mr.Weber. Let me come back to you, Mr. Black, and see--do
you agree that the efficient review--if this was in your
purview, do you agree that the efficient review of class 6
permits is critical for getting carbon management projects like
those funded by DOE off the ground with the goal in mind that
taxpayer dollars aren't being wasted?
Mr.Black. That would certainly seem to be a reasonable
statement, absolutely.
Mr.Weber. And could we add the--to the end of that
statement the fact that we want those businesses to be
successful and get off--get up and running, off the ground, as
it were, and to be able to actually capture more carbon
sequestration--carbon and store it underground? Would that be a
good goal?
Mr.Black. I personally would find no fault with that
statement.
Mr.Weber. I don't understand why that hasn't been a
priority, Mr. Chairman. I yield back.
Mr.Palmer. I thank the gentleman. The Chair now recognizes
the gentleman from New York, my friend Mr. Tonko, for 5 minutes
for his questions.
Mr.Tonko. Thank you, Mr. Chair, and let me congratulate the
[audio malfunction] team for their assignment to----
Voice. Microphone.
Mr.Tonko [continuing]. Subcommittee, and look forward to
working with you.
We have never seen a President encourage lawlessness or
inflict pointless suffering on Americans at the scale we are
seeing today. Nor have committee Republicans failed more
egregiously at holding the President accountable than they are
doing right now. That failure threatens Americans' access to
safe drinking water and even our national security.
Every American deserves safe drinking water. That is why
Democrats made historic investments in our water systems. Right
now that money is being used to bolster drinking water,
wastewater, and stormwater infrastructure across our great
country. In my district this funding is helping to replace
thousands of lead pipes that pose a tremendous risk to people's
drinking water. I have always enjoyed that working relationship
with the Fed EPA and the State DEC.
Even as some funds begin to flow again, Donald Trump's
chaotic funding freeze and mixed messages from EPA have created
pointless uncertainty--uncertainty for States and for families.
Last year, GAO published a report on its priority
recommendations to EPA that had not yet been addressed. Many of
these recommendations focused on EPA's efforts to make certain
that Americans have access to safe drinking water. Since Donald
Trump took office there have been dozens of reports about mass
terminations of Federal employees on short notice, including
the staff at EPA.
So, based on GAO's past work, would drastic workforce
reductions impact EPA's ability to manage drinking water and
wastewater systems? Anybody?
Mr.Gomez. I'm going to start this answer, and perhaps I'll
turn it over to the IG from EPA.
So yes, the--as you said, Congressman Tonko, a big infusion
of funds to the State Revolving Funds, there has been a
demonstrated need across the country for funds for utilities to
make sure that they're upgrading their systems and their
systems are in working order.
So those monies go to the States that EPA provides, and the
States themselves revolve the monies down to the water
utilities to make sure that those are working well. So, yes,
our work has found that it's important for those State
Revolving Funds to be working, and that the folks that work to
provide that are there. But it's really, then, the States and
the local utilities that are doing the work, right, for all of
us to ensure that we have clean drinking water.
Mr.Tonko. But getting those dollars out in an effective and
efficient way----
Mr.Gomez. Is important.
Mr.Tonko. With the States is important.
Mr.Gomez. Yes.
Mr.Tonko. And lesser people means longer time in getting
that work done, as the situation continues to exist or a number
of communities require that assistance from EPA.
Ms. Murley, were you going to say something?
Ms.Murley. Yes, that's correct. And it is--the Office of
Inspector General, it's our responsibility to make sure the
taxpayer dollars are being used as Congress intended, that
they're going to the people that, you know, that need the
money, and the money is getting out.
Mr.Tonko. Well, could abruptly firing hundreds of EPA
staff, as we have seen in past weeks, made it more difficult
for EPA to conduct the data verification audits that GAO
recommends?
Ms.Murley. I think that's a question for you.
Mr.Gomez. I mean, yes, that--I do agree with that
statement, right? If these are the people that are supposed to
do the job, and if they're not, they're--the job--that job----
Mr.Tonko. Right.
Mr.Gomez [continuing]. Isn't being done.
Mr.Tonko. These are answers that I tried to get by going to
EPA, but not a welcome wagon there.
It is not just EPA or our drinking water infrastructure
that is at risk with these pointless firings. Two weeks ago
Elon Musk, empowered as he is, fired more than 300 people from
the National Nuclear Security Administration. The NNSA is
responsible for safeguarding our nuclear weapons stockpile. But
Elon Musk still thought it made sense to fire 16 percent of its
staff overnight. We don't know what the calculus was, what the
awareness was. We have got inspectors general that can advise,
but I guess they are being let go, too.
So even though administration officials quietly scaled back
the purge and--NNSA's importance to our national security is
not something we can afford for someone to learn about through
trial and error. This whole episode is even more concerning
because NNSA has long been included on GAO's high-risk list,
and GAO reports have identified workforce recruitment and
retention as a significant challenge that the agency faces.
So Mr. Rusco, can NNSA effectively address any of the
challenges the GAO has identified by sowing chaos and confusion
in its workforce?
Mr.Palmer. The gentleman's time is almost expired.
Mr. Rusco, you may answer the question.
Mr.Rusco. I can't speak directly to NNSA, but it is
important to have--to strategically look at your workforce and,
if you're going to fire people or hire people, hire and fire
the right people.
Mr.Tonko. That sounds like what efficiency is all about. So
I hope we do finally get to efficiency as a model here.
Thank you, and with that I yield.
Mr.Palmer. The Chair now recognizes the gentleman from
Georgia, Mr. Allen, for 5 minutes for his questions.
Mr.Allen. Thank you, Chair Palmer, for holding this
important oversight hearing today, and I want to appreciate the
witnesses for testifying.
This body has a duty to conduct oversight. All the money
sent out through the Infrastructure Investment and Jobs Act and
so-called Inflation Reduction Act is--it is imperative that we
do our due diligence to see just where that money went.
It is also important to understand, you know, what people--
their job roles, what they are doing, and actually what they
are producing, which seems to get lost in all this. These laws
added to our out-of-control Government spending. And as we have
seen in prior hearings, some of this funding went to special
interest groups. With billions of dollars being given out
rapidly, it is critical that we see where American taxpayer
dollars are going and that they are properly vetted.
There are a lot of questions surrounding EPA's 27 billion
Greenhouse Gas Reduction Fund program, particularly its
decision to use a financial intermediary to hold program
funding, how that differs from other award mechanisms, how EPA
will monitor these funds, and whether Americans will be able to
see what these organizations receiving billions of dollars are
using their money for.
Mr. Gomez, to your knowledge, has the Government
Accountability Office ever seen a structure where a financial
intermediary has been used for grant-making within EPA or any
Federal agency?
Mr.Gomez. So within EPA we're not aware of that. The
Federal Government has used these financial agents for a
variety of different activities. In fact, GAO did a report on
it a number of years ago. But I believe for EPA--and I know
that the IG is here, she can confirm--I believe that that's a
new funding model at EPA.
Ms.Murley. Yes, that's correct.
Mr.Allen. Yes. Ms. Murley, when the EPA Office of Inspector
General became aware of EPA's plan to use a financial
intermediary to hold program funds, what concerns did your
office raise, and what rationale did EPA provide?
Ms.Murley. It was at a meeting that we had where we were
introduced to the program, and we asked questions about the due
diligence process that would be put into place, the vetting.
And because it was new to the EPA, it was new to us as an
oversight agency. So we had questions about the whole process.
We still have--we're still looking into that and the
questions that we had.
Mr.Allen. So it has not been conclusive as to, you know,
what--if this is the right way to do things here?
Ms.Murley. It was, for us, how do we conduct oversight of--
--
Mr.Allen. Yes.
Ms.Murley [continuing]. Such a new program----
Mr.Allen. Exactly.
Ms.Murley [continuing]. And something that we were not
familiar with.
Mr.Allen. OK. Did they give you a reason why they are doing
this?
Ms.Murley. I don't have that----
Mr.Allen. It wouldn't be that they have something to hide
or anything like that, or they don't want you to know what is
going on, or anything like that. OK.
You know, the committee has been examining the risk
associated with EPA's environmental justice grant programs. On
October 16, 2024, your office announced that it was conducting
an audit of EPA's fiscal year 2021 Environmental Justice
Collaborative Problem-Solving Cooperative Agreement Program, in
which 34 recipients were awarded funding. Under the 2023
program, however, EPA selected 98 recipients to receive
funding. That is almost 3 times the number of awards made in
2021.
Ms. Murley, are you concerned about EPA's ability to
monitor so many different recipients and awards?
Ms.Murley. I'm not familiar with the additional program,
but we would always--we always are concerned that there's risks
when you have--there's been systematic challenges that I raised
with data, but also with grants management on both the--getting
out the grants and then the proper monitoring of grant
recipients. So that's continued. That's a theme for us in our
oversight work of the EPA.
Mr.Allen. Yes, and, you know, I would just like to--each
one of you, if you have seen, you know, these dollars go out
rapidly to these grant programs, I mean, what are your
concerns?
And I will start, Ms. Murley, with you. I have got about 44
seconds. I mean, this is unprecedented as far as we know,
particularly with the end of one administration and beginning
of another administration, obviously with $36 trillion in debt.
And, of course, my friends on the other side are questioning,
you know, what are you all doing? Well, we are trying to solve
this issue. So what concerns do you have about what you have
seen?
Ms.Murley. Our concerns, when you have such a large volume
of money getting out the door with such tight statutory
deadlines, are what processes and internal controls were in
place for that money going out. Were the processes followed?
What structures were in place? And so that's always what we
would call a situation of risk, right?
Mr.Allen. Yes.
Ms.Murley. Where there's risk involved when those factors
are in play.
Mr.Allen. All right. I am out of time, but if you would--
you all would respond, I mean, you know, I would like to know
if you all follow where the money actually goes. In other
words, you know, how the money goes and where it ends up.
Mr.Palmer. The gentleman's time has expired.
Mr.Allen. I yield back.
Mr.Palmer. The Chair now recognizes the gentlewoman from
Massachusetts, Mrs. Trahan, for 5 minutes for her questions.
Mrs.Trahan. I thank you, Mr. Chairman, and thank you to our
witnesses here today.
At a Commerce, Manufacturing, and Trade Subcommittee
hearing earlier this month, I spoke about how important it is
for the Government to be a stable and reliable partner in our
public-private partnerships. Businesses that partner with the
Federal Government need to be able to trust that the Government
will follow through on their side of the deal.
But the Trump administration is not delivering stability or
reliability for the American people. They are only providing
confusion and chaos. One day Federal workers are fired, the
next day the Trump administration is desperately trying to
rehire some subset of the people that they just fired. One day
my district has the funds to address stormwater overflows, the
next day those funds are suspended.
And it is not just Democratic districts that are hurt by
unilateral funding freezes. People in districts that my
Republican colleagues represent are also being harmed.
Unfortunately, we just aren't hearing Republicans reflect the
concern and outrage voiced by their constituents.
For example, there's a Bipartisan Infrastructure Law-funded
cleanup of the toxic Peach Tree Orchard Road groundwater plume
in Augusta, Georgia. The Government made a commitment to help
fund this cleanup and improve the lives of the people living in
that community. But arbitrarily freezing the Bipartisan
Infrastructure Law and IRA funding makes it harder for
Americans to actually trust that the Government will follow
through on its commitments and not abandon these important
projects.
When Americans can trust the Government to keep its word,
we can create powerful public-private partnerships and good-
paying jobs. In my district a factory that's being built with
Bipartisan Infrastructure Law funding that will produce low-
cost green hydrogen, a project that improves our energy
security, helps address rising energy costs, and creates family
sustaining jobs--if Republicans truly believed in an all-of-
the-above approach to America's energy future, then this is
exactly the kind of project that they should support.
Investments in clean energy production can help cut costs for
consumers and keep America competitive and resilient.
I think it is important to recognize just how much time and
effort it takes to build new factories and bring them online.
Mr. Rusco, how important it is for the Government to be a
consistent and reliable partner in attracting private
investment?
Mr.Rusco. Well, it is important. It is important from the
perspective of the private sector, when they enter a contract,
that the terms of that contract remain the same throughout the
process.
Mrs.Trahan. And when private partners are worried that the
Government might be inconsistent or unreliable, what effect
does that have on projects and taxpayer investments?
Mr.Rusco. Well, once a once an award has been made for a
public-private partnership, for example, if there are delays,
that can threaten the project.
Mrs.Trahan. And cause rising costs.
Last year the GAO published a report on the Department of
Energy's Office of Clean Energy Demonstrations. This office
does the important work of partnering with the private sector
to deliver clean energy projects at scale. We are talking about
major projects like clean hydrogen and advanced nuclear
reactors, including in rural communities where the energy and
the infrastructure that is delivered through just costs more.
Mr. Rusco in that report GAO made two recommendations to
improve OCED's approach to workforce planning and program
management. Both recommendations remain open. Do you think that
the massive layoffs we have seen at DOE will improve the
Agency's ability to address either of those recommendations?
Mr.Rusco. OCED spent over a year trying to build the
workforce in order to make the awards that it did, and now that
that--a lot of that money is out the door, it is time to, you
know, invest in the monitoring staff. They were already on that
path. And I do know that, in some cases, some of the recent
events that had cost a contract that was designed explicitly to
monitor awards that had gone out the door.
Mrs.Trahan. Thank you. If the Federal Government is
unwilling to invest in America's future, if there is a fear
that a so-called pause will continue indefinitely or recur, why
would businesses ever take the risk to invest alongside the
Government?
For decades, the Federal Government has been a reliable
partner, but this administration is proving that it cannot be
counted on. If the Government cannot be trusted to keep its
word, it will lead to missed opportunities, a slowing economy
with fewer jobs, and wasted tax dollars.
Thank you, I yield back.
Mr.Palmer. The gentlelady yields. The Chair now recognizes
the gentleman from Idaho, Mr. Fulcher, for his questions.
Mr.Fulcher. Thank you, Mr. Chairman. Thank you for the
hearing today. This is going to go to Mr. Gomez and Mr. Rusco,
and it has to do with reporting.
And if I understand correctly, at least from the written
testimony, inspector generals from both DOE and the EPA have--
are citing lack of data as being problematic, lack of data from
potential recipients, subrecipients in--under IIJA. And it
looks like that has led to complications when it comes to the
funding component.
And first of all, I want you to tell me. Am I reading this
right? And if so, you know, some of the reporting is pretty
complex for some of these small municipalities and so on,
especially in the arena of water and whatnot, water purity. Am
I reading that right? And if so, talk to me about the reporting
and what can be done potentially to improve that or maybe
identify the specific data that's needed.
Mr.Gomez. Sure, and thank you for that question. So
generally what we found is that, like, for small utilities
across the country, rural utilities, they usually lack the
technical expertise, the financial support. And so they're
usually looking for ways to simplify, right? Sometimes we have
duplicative reporting, which we've said needs to be done away
with, and they're trying to improve that, right?
So that--you know, yes, they have to do engineering
reports, for example. But there's usually--there's duplicative
reporting or applications to apply for different water
programs, for example. So that is an area that we see where
communities across the country could benefit if there is not
duplicative reporting or if they have the technical support to
help them.
Mr.Fulcher. Mr. Rusco, your comments. And if that is in
line with your thoughts, what do we do?
Mr.Rusco. I would defer to Alberto on that specific--sorry.
Is that on?
Mr.Fulcher. Yes.
Mr.Rusco. I would defer to Alfredo on that specific thing.
Obviously, for monitoring you need quality information from
recipients, and you also need the appropriate staff to evaluate
that in a timely fashion.
Mr.Fulcher. So to that end, we did follow up--my staff
helped--we followed up with some of our municipalities, and the
feedback we get is it is not the monitoring or the reporting.
As long as they can get the data, the specifics, it is not the
monitoring that they are unwilling to do or--inconsistent with
their objectives, because they have to worry about lawsuits and
all of that type of thing, too. But it is who they are
interacting with sometimes, and where that data is going, and
who is responding to them.
And DEQ, for example--Department of Environmental Quality
in our State--is a much-preferred channel to interact with for
especially the smaller municipalities. Once again, I would like
to get input from Mr. Gomez, Mr. Rusco.
How can we improve that relationship so that perhaps the
local is more involved, as opposed to EPA?
Mr.Gomez. Sure. So--and again, in the water sector, usually
it's the EPA regional offices, right? Like, for example, Idaho,
I believe, belongs to region 10, is that right?
Mr.Fulcher. I believe so, yes.
Mr.Gomez. In Washington. So it's those regional EPA staff
that are working with the State of Idaho, that department, for
example, but also reach out to the small utilities in those
towns.
There's also a group called Circuit Riders that actually
help these small communities get the data that they need, put
together engineering reports.
So it's just making sure those communication channels
perhaps are open between the regional people at EPA, the State
people, and then coming down to the local staff.
Mr.Fulcher. OK.
Mr.Gomez. I mean, we go out and talk to these water
districts ourselves to learn from them and to find out what is
it that they're struggling with, what do they need help in.
Mr.Fulcher. OK. Mr. Rusco, I would like your take with this
one added comment. In my State, as is not uncommon in the West,
the scope is so much bigger because the Federal footprint is so
large. Two-thirds of our land mass, for example. Your thoughts?
And we have only got about 20 seconds left, I apologize.
Mr.Rusco. Well, my expertise is on the energy side for
energy awards, Federal energy awards. Typically, the recipients
are private-sector companies. They don't have trouble coming up
with the information as long as the contract is clear, sort of,
what information is required.
When--it's not so much funds going out to communities as it
is in the water situation.
Mr.Fulcher. OK. Thank you, Mr. Rusco.
Mr. Chairman, I yield back.
Mr.Palmer. The Chair now recognizes the gentlelady from
Virginia, Ms. McClellan, for 5 minutes for her questions.
Ms.McClellan. Thank you, Mr. Chairman, and I thank you for
holding this very important hearing.
I want to thank the witnesses for being here this morning.
Your work, as we have discussed, is very critical to making
sure we ensure the transparency and integrity of our
Government, and so thank you for your work.
And some of my questions may have already been touched on,
but these are very important issues of concern, and I want to
make sure that I have a chance to put on the record because my
constituents have raised a lot of concerns about what has been
happening over the past month, where I had a town hall meeting
with, you know, double the number of folks participating as
usual.
And I was deeply concerned when the President fired
inspector generals from across 17 agencies, including the EPA.
As we have discussed today, the job of an inspector general is
to be an independent, nonpartisan watchdog, and it is a vital
role in investigating ethics violations, exposing corruption,
and protecting taxpayer dollars. And the decision to remove the
EPA inspector general is particularly troubling, since EPA
regulators settled multiple lawsuits with Tesla over violations
of the Clear Air Act and hazardous waste laws.
And so, Ms. Murley and Mr. Black, I wonder if you could
further elaborate on the role your offices play in ensuring
that Government programs are free from corruption and conflicts
of interest?
Ms.Murley. Our office is--has a staff of dedicated
oversight professionals that are committed to the mandate that
Congress gave us, which is to prevent and detect waste, fraud,
and abuse, and to promote economies and efficiencies at the EPA
programs. And that is what--and we are very cognizant that
that's our mission, and that's what we show up to work to do
every day. Thank you.
Ms.McClellan. And I thank you for that.
Mr. Black, do you want to add anything?
Mr.Black. Yes, certainly. The role of the OIG is to
identify gaps and opportunities for improvement and changes to
the internal control structure of the Department, its programs,
and its operations, and to--by doing so, to improve and--
prevent fraud, waste, and abuse.
And if I may, I know there's a lot of buzz in the media and
in the Congress about, you know, what risk there is to having
had the inspector generals removed. I want to add some
assurance that the Department of Energy's Office of Inspector
General has a deep and well-trained and experienced staff of
professionals who will continue to do the appropriate oversight
to make sure that the risk for fraud, waste, and abuse is--
continued to be covered, continue to be addressed, and I can
offer some assurance that we are continuing to do our duties as
written in the IG Act. And with or without a head, we've still
got a deep and experienced cadre of leaders who are going to
make sure that this mission continues to be addressed.
Ms.McClellan. And I am glad to hear that, and that is true
of so many of our Federal agencies and so many of our civilian
Federal workforce, our military Federal workforce, who are
dedicated to upholding their oath of office and helping us
uphold ours to preserve, protect, and defend the Constitution
of the United States.
And yet--including over 300,000 Federal employees in
Virginia, where I represent. And yet, ever since President
Trump and Elon Musk started taking a chainsaw to our Federal
agencies, again, constituents have flooded my office with
thousands of calls about the consequences of these reckless
actions, including the wholesale firing of the Federal
workforce, even in cases where the people firing them had no
clue what they did, like protect our nuclear stockpile.
And these are professionals who have served faithfully
under both Democratic and Republican administrations, just like
those in your Department. But now an unelected billionaire and
his DOGE bros who have no idea what many of these agencies or
what many of these employees, including probably you, do are
making decisions and forcing employees to justify their very
existence.
Firing probationary employees? That doesn't just gut our
Federal workforce, it helps to destroy our entire talent
pipeline. And as you just said, you have a cadre of
professionals. Probably some of them are probationary or once
were probationary. And having them summarily fired makes it
very difficult to keep that talent pipeline going.
And so, Ms. Murley and Mr. Black, have your offices found
any evidence that the mass firing of civil servants at any
agency like EPA or the DOE have actually benefited our country
in the past month?
[No response.]
Ms.McClellan. And you may--we may not have time for you to
answer here, so I will ask you to submit your answer on the
record afterwards, please.
And I yield back.
Mr.Black. We will be happy to do so.
Mr.Palmer. The gentlelady's time has expired. The Chair now
recognizes the gentlewoman from Colorado, Ms. DeGette, for 5
minutes for her questions.
Ms.DeGette. Thank you very much, Mr. Chairman, and I
apologize that we haven't been able to be here for the entire
hearing. Mr. Carter and I--he is the ranking--he is the chair
and I am the ranking member of the Health Subcommittee. We are
in the middle of a hearing downstairs, but we have been
following what has been happening, and we appreciate all of you
coming today.
I particularly want to thank Mr. Black and Ms. Murley for
coming today from the Offices of Inspectors General at DOE and
the EPA, because it is your offices that hold our agencies
accountable to prevent waste, fraud, and abuse. I think it is a
shame that former EPA Inspector General O'Donnell and former
DOE Inspector General Donaldson can't add to this conversation
since they were unceremoniously fired by President Trump. But I
am glad, Mr. Black, to hear you say that the law is still going
to be enforced by the people who are left.
I want to talk about waste, fraud, and abuse, though,
however, because--I want to talk about that.
Now, Mr. Black, did any point in the last Congress, when we
had 20 Oversight and Investigations hearings, did--at any point
did the former DOE inspector general present at this committee
guidance of waste, fraud, or abuse as it relates to the grants?
Mr.Black. We have been performing a great deal of oversight
work on grant activities funded by the IIJA and the IRA.
Ms.DeGette. Yes.
Mr.Black. And we've certainly identified some internal
control gaps that warrant some improvement. And we do, in fact,
have some investigations that--
Ms.DeGette. So let me ask. Let me ask the question again.
Mr.Black. OK.
Ms.DeGette. Did the inspector general present any evidence
of waste, fraud, or abuse in these grants to this committee
last Congress, yes or no?
Mr.Black. I do not believe that the written statements
included specific instances.
Ms.DeGette. Thank you. Now, Ms. Murley, did the former EPA
inspector general present any evidence of waste, fraud, or
abuse to this committee as it relates to this--these grants?
Ms.Murley. I would have to submit for the record his past
testimonies. I don't have them----
Ms.DeGette. Are you aware of any?
Ms.Murley. In the reports that I cite in our--in my
testimony, that--there are instances of--that we found waste or
funds that could be put to better use in some of the reports
that we've done.
Ms.DeGette. OK. Do you know that--and you don't know
whether that was presented to this committee, is that what you
are saying?
Ms.Murley. I don't, but I can----
Ms.DeGette. OK.
Ms.Murley [continuing]. Follow up.
Ms.DeGette. I would appreciate if you supplement your
answer.
Now, over $262 million in funding from this Clean School
Bus Program, airport infrastructure grants, energy efficiency
upgrades, and other grants have been frozen in Denver, which is
my district. The projects in jeopardy were announced and put in
motion between 2022 and the first half of 2024, well before the
election and despite the claim that the Biden administration
``was throwing gold bars off the Titanic.''
So I want to talk for a minute about this in the context of
waste, fraud, and abuse. One month into the Trump
administration, all of these grants were frozen. I would call
that abuse because all the grants have been frozen and taxpayer
money is just not being used.
So Ms. Murley, I want to ask you a question: Could defying
legal court orders to release the funds already obligated and
allocated constitute an abuse of power?
Ms.Murley. I think that's a question better directed to the
Agency, and I can speak to----
Ms.DeGette. So if they already gave the funds, and then
there was--then the funds were blocked, and then a court said
``release them'' and they didn't, wouldn't that be an abuse of
power?
Ms.Murley. I think that's a question for the Agency.
Ms.DeGette. OK. I guess I can understand why you wouldn't
want to answer it.
Now, since EPA--Zeldin was confirmed, over 1,000 EPA
employees have also been fired or placed on leave. Ms. Murley,
isn't this reduction in workforce antithetical to your office's
own 2022 report recommending that EPA should enhance its grants
oversight workforce?
Ms.Murley. Our reports have recommended that EPA enhance
its grants workforce, as has our top management challenges
identified that as a problem for the Agency.
Ms.DeGette. Great, thanks.
I yield back.
Mr.Palmer. The Chair now recognizes the gentleman from
Georgia, Mr. Carter, for his--5 minutes for his questions.
Mr.Carter of Georgia. Thank you, Mr. Chairman. I appreciate
you giving me the opportunity to waive on, and I thank all of
our witnesses for joining us today as we look to examine the
Biden administration's energy and environmental--environment
spending, a series of decisions that drastically increase
waste, fraud, and abuse in our already bloated bureaucracy.
In my own State, the State of Georgia, the Biden EPA handed
out 2 billion--that is B, billion--dollars to the Stacey
Abrams-backed group Power Forward Communities in April of 2024.
Power Forward Communities received this money even though it
was founded only a couple of months earlier, in late 2023, and
it never managed anywhere, anywhere near the grants dollar
figure it reported. In fact--listen to this now--just $100--
$100--in total revenue during its first 3 months in operation.
It went from $100 to $2 billion. If that's not waste, fraud,
and abuse, I don't know what is.
But nevertheless, Ms. Murley, let me ask you. If a concern
about conflict of interest or ethics was brought before the EPA
Office of Inspector General, how would your office handle that?
Ms.Murley. It would depend on the circumstances involving
the complaint that was brought to our office. But we would look
at--if we were talking about the conflict of interest involved
with EPA employees, we would look at the ethics agreements
involved, the financial disclosures of those individuals.
And then, if we're talking about the----
Mr.Carter of Georgia. So you do look at the financial
disclosures.
Ms.Murley. Yes, in the situation----
Mr.Carter of Georgia. Of the group, or the individuals, or
both?
Ms.Murley. Well, in that situation I was talking about the
individuals.
Mr.Carter of Georgia. OK.
Ms.Murley. But we would do--there's two different
scenarios. There's the EPA employees who are working on a
program, and then the conflicts of the recipients of the
Federal funds.
Mr.Carter of Georgia. OK. Would it stroke your interest if
you saw where a group had only had $100 in revenue for the
first 3 months and then all of a sudden was being given a grant
of $2 billion?
Ms.Murley. That would be something that we would be
interested in----
Mr.Carter of Georgia. Sure.
Ms.Murley [continuing]. Looking at.
Mr.Carter of Georgia. OK. Have you heard of this grant that
was given to Power Forward Communities in a--before? Have you
heard about this? I am sure you have.
Ms.Murley. I have--not specifically that one, but--I don't
recall.
Mr.Carter of Georgia. You don't recall? OK.
Ms.Murley. There's been a lot.
Mr.Carter of Georgia. There has been a lot. But in the
State of Georgia, this is, as you can imagine, of interest to
us.
So can I just ask you, would you commit here that you will
ensure that these funds were properly allocated? In other
words, will you please look at what happened with Power
Forward?
Ms.Murley. Yes. Yes, we are initiating work in the IRA
space at this point in time to look at the EPA's----
Mr.Carter of Georgia. You were a little hesitant. I mean,
is that a yes?
Ms.Murley. Yes.
Mr.Carter of Georgia. Yes. Thank you, thank you. All right,
let me ask you this: How can EPA be sure that programs are
spending money wisely and not giving their friends at these
organizations free reign over American tax dollars?
I assume this is what you were speaking to earlier when you
say you are looking at the disclosures of the EPA officials as
well as the group itself.
Ms.Murley. Well, you look at all of it. When you--we
conduct audits or evaluations, we look at how the program was
set up, the internal controls in place, what checks that they
have.
Mr.Carter of Georgia. Did you look at this, do you know?
[No response.]
Mr.Carter of Georgia. Before this money went out, did you
all look at it?
Ms.Murley. I don't know, off the top of--I would have to
get that for the record.
Mr.Carter of Georgia. Can you get that for me?
Ms.Murley. Yes.
Mr.Carter of Georgia. For the record. You know, what was
looked at and what concerns were expressed, if any.
Ms.Murley. Yes.
Mr.Carter of Georgia. Thank you, I appreciate that.
Mr. Black, let me ask you this. In your opening statement
you mentioned the fast nature in which funds moved at the
Department of Energy, and $46 billion in loans completed
between December of 2024 and January of 2025--that's got to be
a record. Wow.
Mr.Black. Yes, that is incredibly fast. For example, 15
years ago, during the American Recovery and Reinvestment Act,
the Department of Energy Loan Program Office issued about $40
million--don't quote me on the number--approximately over 5
years. So--
Mr.Carter of Georgia. Over 5 years.
Mr.Black. So this--
Mr.Carter of Georgia. And yet in 1 month we had $46
billion. Did that raise any----
Mr.Black. Oh, yyes, that is of concern to us. And we are
definitely looking into the facts and circumstances surrounding
the pace with which those loans have been signed.
Mr.Carter of Georgia. Mr. Chairman, I really do appreciate
this hearing, and thank you for holding this.
Come on. We need help here. Ms. Murley, we really do need
help. I look forward to your answers to my questions.
Thank you, Mr. Chairman. I appreciate your opportunity to
waive on, and I yield back.
Mr.Palmer. I thank the gentleman. The Chair now recognizes
the gentlewoman from Michigan, Mrs. Dingell, for 5 minutes for
her questions.
Mrs.Dingell. Thank you, Mr. Chairman, and I love my
colleague from Georgia. He and I are working on many things
together.
I hope you have that same standard of ethics at a whole lot
of other things that are going on right now, too, that we need
to be looking at conflicts of interest.
And I happen to be someone who thinks that this is a very
important program and that we need to be spending the money
wisely. And importantly, not one penny should be
misappropriated in any way. And I will join my colleague. I
think that should be a standard across the Government.
We have a moral obligation to invest in clean energy. Clean
energy investments do not just help us meet our energy needs
while protecting the environment, they also represent a great
economic opportunity. Unfortunately, Republicans seem too busy
attacking clean energy investments to notice the jobs that
those investments are creating for American workers and, even
more importantly, how they are lowering the costs for working
families.
Even, you know, our new EPA Administrator has also attacked
the Greenhouse Gas Reduction Fund. And I want to make sure
people are getting the right facts, that they are not getting
misinformation. So I want to set the record straight again.
The Greenhouse Gas Reduction Fund was established by the
Inflation Reduction Act and based on original bipartisan
legislation with Republicans and Democrats. I admit I was one
of them, but it was a bipartisan group. The Greenhouse Gas
Reduction Fund was on track to invest $27 billion to make clean
energy financing more accessible for working-class communities,
the same communities that have borne the brunt of environmental
pollution, robbing them of their health and economic
opportunities.
I have long been a vocal supporter of creating a clean
energy accelerator because of its potential to make and manage
investments in ambitious, clean energy that benefits working
families. The Greenhouse Gas Reduction Fund represents the
culmination of these efforts, empowering us to attack the
climate crisis head on. The fund is even designed to leverage
private capital by uniting the public and private sector around
the shared goals of decarbonizing our country and creating jobs
for American workers--American workers--all while lowering
energy costs for families.
EPA was labor--laser focused on making sure every dollar is
reached, that products would not have otherwise been built. But
now it seems as if they are only focused on making it
impossible for the Greenhouse Gas Emission Reduction Fund to
succeed. It doesn't have to be this way.
I know Republicans spent the last 2 years investigating
EPA's implementation of the IRA, including the Agency's
rigorous process of selecting, vetting, and issuing final
awards to the Greenhouse Gas Fund's recipients. If you had
found anything, I am certain that you would have shared it with
us instead of waiting for President Biden to leave office. So I
am just questioning how we seem to have found money that was
never missing, especially given intense scrutiny that began as
soon as the IRA was signed into law, not when President Trump
became President.
I know everybody wants the Greenhouse Gas Reduction Fund to
fail on the Republican side, and that makes me sad. It would be
terrible for American workers and working families. The
Greenhouse Gas Reduction Fund Solar for All program was on
track to support residential solar deployment efforts in every
State, that can save families 20 percent or more on their
energy bills.
Meanwhile, the National Clean Investment Fund and Clean
Communities Investment Accelerator were designed to work
together to leverage private investments supporting clean
energy projects while ensuring the benefit of those investments
go directly to communities where investments are made. Instead
of working to make sure that the Greenhouse Gas Reduction Fund
succeeds, you all just want to keep betting against it. And
looks like this administration is doing the same thing.
The Greenhouse Gas Reduction Fund, by design, is intended
to reach red and blue States and their districts. We cannot let
the promised benefits of the Greenhouse Gas Reduction Fund slip
away because some would rather play some political games than
support investments in all communities and get us energy
security and reduce consumers working--those hard-working
people who say they want to pay less in their bills. So let's
stop trying to make sure that it is going to fail.
I am almost out of time, so I didn't get to ask you all any
questions, but I think this Greenhouse Gas Reduction Fund makes
a difference, it lowers cost. And I would ask my colleagues
here, I think it's simply too important to let fail----
Mr.Palmer. The gentlewoman's time has expired.
Mrs.Dingell [continuing]. And I yield back.
Mr.Palmer. The Chair now recognizes the gentlewoman from
Florida, Ms. Castor, for 5 minutes for her questions.
Ms.Castor. Thank you, Mr. Chairman, and thank you all for
being here today.
Just a couple of days into this new administration, the
President illegally fired 19 inspectors general, including the
IG from the EPA and the Department of Energy. These are vital
public servants. They are the cops on the beat that help us
root out waste, fraud, and abuse and make nonpartisan
recommendations to Congress to act upon.
I would like to know, Ms. Murley, has the illegal firing of
the EPA IG delayed your oversight responsibilities in your
office?
Ms.Murley. It has not.
Ms.Castor. Has it complicated it? Has it taken time and
energy away from the tasks at hand?
Ms.Murley. Any change in any organization brings a period
of time where things have to settle and----
Ms.Castor. Yes.
Ms.Murley. But----
Ms.Castor. Have--go ahead.
Ms.Murley. But I will say, and I'll echo my colleague's
point, we have a dedicated staff of professionals, oversight--
professional oversight professionals who are committed to the
mission of the OIG.
Ms.Castor. I--and I appreciate them.
Have--how many people have been fired or left out of EPA
IG's office?
Ms.Murley. We have not had any firings or people leave. We
do--we did have about 32, I believe, individuals--I need to get
that exact number--who were in the process of being hired that
are caught up in the hiring freeze, and we had about 23
individuals take the deferred resignation program.
Ms.Castor. They--OK.
And for Mr. Black, same question: Has the firing of the
inspector general taken time away? As Ms. Murley said,
sometimes it takes time to settle when there are changes.
Mr.Black. Yes. I work in the front office, and I work
directly with and for the inspector general as her chief
advisor. And there was certainly some disruption when Terry
Donaldson was removed. However, like I said in a previous line
of questioning, there's a cadre of professionals, of 300-plus
IG accountants, auditors, inspectors, lawyers that continue to
serve the taxpayer by preventing fraud, waste, and abuse----
Ms.Castor. Thank you.
Mr.Black [continuing]. And we will continue to do so.
Ms.Castor. And then what was--what has been the change in
personnel from the beginning of the year to today?
Mr.Black. We have--the organization had 39 people accept
the deferred resignation program, including myself. So my last
day is going to be close of business Friday this week. And
that's the only number that I have come here prepared with.
Ms.Castor. How long have you worked at the IG's office?
Mr.Black. Thirty-three years.
Ms.Castor. Thirty-three years. OK.
You know, the other illegal activity has been--at the
outset of this administration--the shutdown and/or freeze on
funding. Has the EPA IG's Office--are you keeping track of, you
know, especially now that Federal courts have ruled that those
freezes on grants and loans are illegal, are you keeping track
of how much money now is being illegally withheld that should
be, you know, part of the course of doing business?
Ms.Murley. I don't know if that's a number we're tracking.
Ms.Castor. OK. And do you have any information on that
account?
Ms.Murley. I do not, and I think those questions would be
better directed at the Agency.
Ms.Castor. OK. Mr. Black?
Mr.Black. So 2 days ago I met with the top leadership of
the Department's Loan Programs Office, and they clarified that,
although new loan closures are paused, the disbursements for
those loans that have been closed that are active,
disbursements are being made after leadership reviews,
individual transactions, and disbursements are being made.
Ms.Castor. What grants and loans are being frozen right
now?
Mr.Black. That's a question best asked to the Department,
but I'm aware--and there's, I mean, literally hundreds of grant
programs and five loan programs. But--so that's a complex
question with a lot of moving parts. But they--I'm informed by
Department leadership that there is a process in place to make
disbursements for programs on a case-by-case basis, as
situations----
Ms.Castor. But I think the Federal courts have ruled that
they don't have the authority to make--they don't, that that is
an illegal action to withhold the grants and loans that are
congressionally directed. So you are saying that the Agency has
told you they are still freezing, they are still holding back
funds?
Mr.Black. That is not what I am saying at all. I am
informed by Department leadership that disbursements are being
made after leadership review.
Ms.Castor. Thank you.
I yield back.
Mr.Palmer. I thank the gentlelady. I will now recognize
myself for 5 minutes for my questions, and I want to point out
that we are holding this hearing to address concerns about
hundreds of billions of dollars in fraud and improper payments
that are now about $240 billion per year. That is why a freeze
would be appropriate, to do the needed investigations to
attempt to stop the abuse of American taxpayers.
First of all, Mr. Black, thank you for your service.
The ranking member claimed that my majority colleagues and
I wasted time conducting oversight to these programs.
Considering that we are sending out $240 billion a year in
improper payments, would you all agree that oversight of
hundreds of billions of dollars in Federal funding under these
programs is a waste of time? Just a yes or no.
Ms. Murley, is this a waste of time?
Ms.Murley. No.
Mr.Palmer. How about you, Mr. Gomez?
Mr.Gomez. No.
Mr.Palmer. How about you, Mr. Black?
Mr.Black. Absolutely not. The more oversight, the better.
Mr.Palmer. How about you, Mr. Roscoe?
Mr.Rusco. No.
Mr.Palmer. Rusco, I should say, not Roscoe.
Also, Mr. Guthrie--Chairman Guthrie--and Mr. Carter both
raised this question about these grants that went to two
relatively small entities. In particular, the one Mr. Carter
mentioned had $100 in revenue and then suddenly got $2 billion.
Doesn't that raise some serious questions about capacity?
I mean, aside from any allegations or suspicions or
considerations about the possible--possibility of fraud or
misuse of the funds, wouldn't that be a major capacity issue?
Mr. Black?
Mr.Black. Capacity is a concern, and the capacity to
appropriately manage the vast funds from the IIJA and the IRA
has been identified as a risk by the OIG in the past, and it
remains our--one of our----
Mr.Palmer. Shouldn't we be looking at where the money went?
Because if you go from $100 to $2 billion, that should raise
some serious questions about the capacity of the organization
to handle that amount of money, and maybe raise some questions
about pass-throughs, these entities being set up as pass-
through vehicles, which I think we will look into at a later
date.
Ms. Murley, my colleagues also expressed concern about
staffing at the EPA Office of Inspector General, but they were
not as concerned when they decided not to provide any funding
for its oversight work in the IRA. Did that pose any challenges
for your organization to--when you had this massive amount of
money flowing in?
Ms.Murley. It does pose challenges because of resource
constraints with our staffing. You know, we did receive funding
for IIJA oversight, and I think the work that we've done there
demonstrates the good work that we can do and our ability to
provide results when we're given the funds to do sufficient
oversight.
With the IRA we are constrained to our core budget, and
about 40 percent of our audit work is mandatory. So that's
what's done by--what we have to do by statute. So we are
constrained in the ability to do a more robust oversight of the
IRA. That said, we are looking at our core resources and doing
the best we can in that area.
Mr.Palmer. OK. Mr. Black, in December your office reported
that the DOE LPO is administering more than $385 billion in new
loan authority without ensuring a regulatory and contractually
compliant and effective system to manage the organizational
conflicts of interest.
In the interim findings report, the IG stated that the Loan
Program Office seems to be asserting that as long as it does
not compile, track, update, or reconcile relationships, it
maintains a 100 percent compliance rate across the Loan
Programs Office, also referring to it as ``trust but don't
verify.'' Can you explain the concerns stemming from this lack
of systemic management of organizational conflicts of interest?
Mr.Black. Certainly. So the finding that we are--have
identified and issued in that report concerned the lack of
appropriate controls to document and do the cross-checking and
make sure that the--all known parties on both sides of the
transaction are properly identified and disclosures are made
with regard to who's representing who, who has relations to
who, and stuff like that.
The Department responded--the prior administration
responded by disagreeing with the severity of the impact, the
magnitude of the lack of these conflict-of-interest controls.
And they, as part of their defense, noted that there have been
no published findings of serious conflicts of interest. And our
response was that the notion that you hadn't identified these
things was simply because--was primarily because you didn't
have the mechanisms in place, the controls in place to have
those comparisons and identifications of related parties
identified.
Mr.Palmer. You said something in your testimony that I took
note of, and there was something also said by the inspector
general that I took note of, that the inspector general
referred to it as, ``They treat it like Monopoly money.'' And--
but you said something in your testimony about a tolerance for
risk. And I think that is why we are holding this hearing, why
we are going to continue to dig into this. And I fully
anticipate that we will be inviting people back in to meet with
us again.
With that, I will yield back, and I would like to thank all
the witnesses for being here today.
Members may have additional written questions for all of
you. I will remind Members that they have 10 business days to
submit additional questions for the record, and I ask that the
witnesses do their best to submit responses within 10 business
days upon receipt of the questions.
And Mr. Black, since Friday is your last day, you should
have time to answer them if anyone submits them.
So I ask unanimous consent to insert in the record the
documents included on the staff hearing documents list.
Without objection, that will be the order.
[The information appears at the conclusion of the hearing.]
Mr.Palmer. Without objection, the subcommittee is
adjourned.
[Whereupon, at 12:38 p.m., the subcommittee was adjourned.]
[Material submitted for inclusion in the record follows:]
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