Our Objective(s)To evaluate PHMSA's (1) collection and tracking of hazardous materials (HazMat) registration fees and (2) monitoring and reporting of grantees' use of funds for the Hazardous Materials Emergency Preparedness (HMEP) Grant Program.
Why This AuditPHMSA administers grants, for emergency planning and first responder training related to the transport of HazMat. To fund these grants, PHMSA collects fees from HazMat transporters for their required annual registrations. We conducted this audit due to a recent significant increase in HazMat grant funding authorized under IIJA and the important roles the grants play in preparation for and response to emergency HazMat incidents.
What We FoundPHMSA's processes for registration fee collection and data tracking make data verification difficult.
PHMSA uses an online registration portal to collect registrants' data and fees to support the HazMat Grant Program. The Agency requires registrants to determine their business' sizes using the Small Business Administration's (SBA) business-size regulations and then self-certify the accuracy of their data. These SBA business-size regulations include complex variables and increase the risk for inaccurate fee assessments.
Data quality issues impact PHMSA's ability to monitor the quantity and accuracy of the information in its registry. PHMSA could not readily explain why the data issues we found"such as business size and fee mismatches"occurred. A PHMSA standard operating procedure (SOP) includes a daily error reporting process to identify data quality issues, but staff were unfamiliar with and could not locate any daily error reports or anyone who was familiar with them.
PHMSA did not always comply with its grant monitoring procedures or congressional reporting requirements.
PHMSA did not always complete all monitoring activities as required by its HazMat Grants SOP. Forty of 64 (62.5 percent) low and medium risk grantees we evaluated did not receive required annual spot checks, and 25 of 43 (58.1 percent) medium and high-risk grantees did not receive required desk reviews. PHMSA also did not receive or review all grantees' financial and performance reports in a timely manner.
PHMSA did not meet the annual reporting requirements to Congress but has implemented a redesign of its report and data collection process to meet these requirements.
RecommendationsWe made four recommendations to improve PHMSA's oversight of HMEP grants.
