Superfund Activities in the Environment and Natural Resources Division for Fiscal Years 2004 and 2005

Audit Report 07-43
September 2007
Office of the Inspector General


Appendix IV
FY 2005 Accounting Schedules and Summaries

May 4, 2006



Mr. Robert L. Bruffy
U.S. Department of Justice
Environment and Natural
   Resources Division
Suite 8000
601 D Street N.W.
Washington, DC. 20004


Dear Mr. Bruffy:

Enclosed please find the following final fiscal year 2005 year end accounting schedules and summaries relating to costs incurred by the United States Department of Justice (DOJ), Environment and Natural Resources Division (ENRD) on behalf of the Environmental Protection Agency (EPA) under the Comprehensive Environmental Response, Compensation and Liability Act of 1980 and the Superfund Amendments and Reauthorization Act of 1986 (SARA or, hereafter, Superfund):

The schedules represent the final fiscal year 2005 amounts, and establish an indirect cost rate applicable to the entire fiscal year. As a result, the summaries included supersede all prior preliminary information processed by us relating to fiscal year 2005.

The schedules, summaries and calculations have been prepared by us based on information supplied to us by the ENRD. Professional time charges, salary data, and other case specific cost expenditures have been input or translated by us to produce the aforementioned reports. Total costs incurred or obligated by the ENRD as reflected in the Expenditure and Allotment Reports (E&A) for the period have been used to calculate the total amount due from EPA relating to the Superfund cases. Computer-generated time reporting information supplied to us by DOJ (based on ENRD's accumulation of attorney and paralegal hours) along with the resulting hourly rate calculations made by us based on ENRD-supplied employee salary files, have been reviewed by us to assess the reasonableness of the calculated hourly rates. All obligated labor amounts reflected on the E&A's as of September 30, 2005, which are not identified as case specific, have been classified as indirect labor.

Our requested scope of services did not constitute an audit of the aforementioned schedules and summaries and, accordingly, we do not express an opinion on them. However, the methodology utilized by us to assign and allocate costs to specific cases is based on generally accepted accounting principles, including references to cost allocation guidelines outlined in the Federal Acquisition Regulations and Cost Accounting Standards. In addition, we understand that the DOJ audit staff will continue to perform periodic audits of the source documentation and summarized time reporting information accumulated by ENRD and supplied to us. Our accounting reports, schedules and summaries will, therefore, be made available to DOJ as part of this audit process. Beyond the specific representations made above, we make no other form of assurance on the aforementioned schedules and summaries.


Very truly yours,




Rubino & McGeehin Consulting Group, Inc.

Enclosures

  Schedule 1  
EPA BILLING SUMMARY
SUMMARY OF AMOUNTS DUE
BY INTERAGENCY AGREEMENT
 
September 30, 2005
 
    Fiscal Years
 
  2005   2004   2003   2002   2001  
EPA Billing Summary - Amount Paid   $ 22,088,194 (a) $ 24,876,683 (b) $ 26,519,420 (b) $ 27,619,530 (b) $ 28,969,649 (b)
 
Add:                    
Payments in FY 2005 for 2004 (a)   - 2,540,877 - - -  
 
Payments in FY 2005 for 2003 (a)   -   -   59,641   -   -  
 
Payments in FY 2005 for 2002 (a)   -   -   -   62,284   -  
 
Payments in FY 2005 for 2001 (a)   -   -   -   -   (1,933)  
             
               
Subtotal 22,088,194 27,417,560 26,579,061 27,681,814 28,967,716  
             
Unliquidated Obligations (c) 4,874,211 575,048 441,102 26,005 -  
               
Total $ 26,962,405 $ 27,992,608 $ 27,020,163 $ 27,707,819 $ 28,967,716  
 
 
  (a) See EPA Billing Summary, Schedule 2, September 30, 2005  
  (b) See EPA Billing Summary, Schedule 1, September 30, 2004
  (c) See EPA Billing Summary, Schedule 3, September 30, 2005
  Schedule 2
   
EPA BILLING SUMMARY
SUPERFUND OBLIGATION AND PAYMENT ACTIVITY DURING 2005
BY FISCAL YEAR OF OBLIGATION
 
 
  Fiscal Years
 
  2005   2004   2003   2002   2001   Total
Amounts Paid:  
  Labor   $ 7,063,184   $ -   $ -   $ -   $ -   $ 7,063,184
 
  Other Direct Costs   1,111,321   687,536   145,821   58,549   2,276   2,005,503
 
  Indirect Costs   13,564,536   1,715,876   (86,180)   3,735   (4,209)   15,193,758
 
  Superfund Program Expenses   349,153   137,465   -   -   -   486,618
 
  Subtotal   22,088,194   2,540,877   59,641   62,284   (1,933)   24,749,063
 
Unliquidated Obligations (a)   4,874,211   575,048   441,102   26,005   -   5,916,366
 
Totals   $26,962,405   $3,115,925   $ 500,743   $88,289   ($1,933)   $30,665,429
 
 
 
     
 
  (a) See Schedule 3  
  Schedule 3
EPA BILLING SUMMARY
FISCAL YEARS 2005, 2004, 2003 AND 2002 UNLIQUIDATED OBLIGATIONS
 
September 30, 2005
 
  Fiscal Years
 
  2005   2004   2003   2002
 
ENRD Unliquidated Obligations
    at September 30, 2005
               
$32,410,939   $4,372,164   $ 3,236,481   $ 78,675
 
Less: Unliquidated Obligations:                
 
    Section 1595 (a)   17,365,164   2,986,724   1,816,354   52,639
    Section 1596 (b)   616,000   753,613   965,660   -
    Section 1598 (c)   2,361,545   557,230   436,572   25,995
 
       Subtotal   20,342,709   4,297,567   3,218,586   78,634
 
Net Unliquidated Obligations - ENRD   12,068,230   74,597   17,895   41
Superfund percentage (d)   20.8205%   23.8859%   25.3151%   24.3589%
Superfund portion of Unliquidated
    Obligations
 
  2,512,666   17,818   4,530   10
 
Add - Section 1598 Unliquidated
    Obligations
               
  2,361,545   557,230   436,572   25,995
 
Total Superfund Unliquidated
    Obligations (e)
  $ 4,874,211   $ 575,048   $ 441,102   $ 26,005
 
(a) Section 1595 relates to reimbursable amounts from agencies other than EPA.
(b) Section 1596 relates to non-Superfund charges.
(c) Section 1598 relates to charges that are Superfund specific.
(d) Superfund percentage of unliquidated obligations was calculated by dividing year to date Superfund
  direct labor by the total direct labor for each of the fiscal years.
(e) Relates only to unliquidated obligations for the fiscal year indicated.
  Schedule 4
EPA BILLING SUMMARY
INDIRECT RATE CALCULATION
 
September 30, 2005
Description   Total
Amounts
Paid (a)
   
Indirect labor (b) $26,545,791
Fringes 15,384,042
Indirect travel 451,893
Freight 362,261
Office space and utilities 15,080,284
Printing(forms, etc.) 52,021
Training and other services 4,675,969
Supplies 619,548
Non-capitalized equipment and miscellaneous 654,509
   
    Subtotal 63,826,318
   
Total Direct Labor 33,924,192
   
    ENRD Indirect Costs Rate - F/Y 2004 Obligations 188.1440%
 
 
Plus: Superfund Indirect Costs for Prior Year Obligations (c) and Superfund Specific Costs (d)
  2005   $ 275,579  
2004   1,715,876
2003   (86,180)
2002   3,735
2001   (4,209)
Total   1,904,801  
    Superfund Direct Labor 7,063,184
    Superfund Indirect Rate   26.9680%
Total Indirect Rate 215.1120%
 
(a) Indirect cost rate calculations are presented on a fiscal year-to-date basis. All case specific and other unallowable costs (Section 1595 and 1596) have been removed.
(b) Indirect labor and fringes include certain month-end obligation accruals.
(c) Indirect cost payments for the prior year obligations included in the totals presented are as follows; $1,603,240; $(86,180); $3,735; and $(4,209) for F/Y 2004 through 2001 respectively.
(d) The balance of the charges in the totals presented were paid during fiscal year 2005 to maintain Superfund case information or perform other Superfund Specific activities. These charges were initiated as a result of Superfund and are of benefit only to the Superfund Program. They have been allocated only to Superfund cases through this separate indirect approach. The charges are $275,579 and $117,014 for Fiscal Years 2005 and 2004 respectively.
  Schedule 5
 
EPA BILLING SUMMARY
SUPERFUND COSTS BY OBJECT CLASSIFICATION
 
September 30, 2005
                 
Object
Class.
Description Direct
Expenses
  Superfund
Program
Expenses
Indirect
Expenses
Unliquidated
Obligations
(b)
Total
               
11 Salaries $7,614,862 (a) $ 113,303 $5,674,596 $2,281,884 $15,684,645
               
12 Benefits - - 3,203,033 121,763 3,324,796
             
21 Travel 354,368 - 94,086 56,297 504,751
             
22 Freight - - 75,424 85,017 160,441
             
23 Rent - 216,075 3,254,716 394,557 3,865,348
             
24 Printing 18,132 - 10,830 4,260 33,222
             
25 Services 187,143 9,433 983,868 1,461,101 2,641,545
             
26 Supplies - - 128,992 43,845 172,837
             
31 Equipment - 10,342 138,991 425,486 574,819
  Total $8,174,505 $ 349,153 $13,564,536 $4,874,210 $26,962,404
 
 
(a) Includes costs for direct labor, special masters and expert witnesses.
(b) Represents the Superfund portion of unliquidated damages.
  Schedule 6
 
  EPA BILLING SUMMARY
RECONCILIATION OF TOTAL ENRD EXPENSES
 
  September 30, 2005
 
    ---Superfund---   ---Non-Superfund---   Indirect
Section
1595 & 1596
Expenses
Total
Amounts
Paid
Object
Class.
Description Direct
Expenses
  Indirect
Expenses
Direct
Expenses
  Indirect
Expenses
 
11 Salaries   $7,728,165   $5,674,596   $27,031,542   $21,018,821   $79,142   $61,532,266
               
12 Benefits - 3,203,033 - 12,181,009 36,906 15,420,948
               
21 Travel 354,368 94,086 1,796,813 357,807 15,498 2,618,572
               
22 Freight - 75,424 - 286,837 - 362,261
               
23 Rent 216,075 3,254,716 - 11,940,493 - 15,411,284
               
24 Printing 18,132 10,830 54,233 41,191 - 124,386
               
25 Services 196,576 983,868 2,931,942 3,702,410 3,472,765 11,287,561
               
26 Supplies - 128,992 - 490,556 - 619,548
               
31 Equipment 10,342 138,991 - 518,237 3,907 671,477
               
Total   $8,523,658 $13,564,536 $31,814,530 $50,537,361 $3,608,218 $108,048,303



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