▶ 0:00:00the 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 with
▶ 0:00:30that Mr chairman i y back chairman now recognizes the chair of the full committee uh the gentleman from Kentucky chairman Guthrie for five minutes for an opening statement thank you chairman Palmer for bringing us together on this important hearing and look forward to working with this subcommittee as we work through this Congress last Congress the committee and government Watchdogs highlighted alarming developments at as the EPA and doe began rolling out new and expanded programs in distribution in distributing funding one program
▶ 0:01:00that ENC capat a lot of our concerns with this new program is epa's greenhouse gas reduction Fund in 2024 the Biden Administration announced the awarding of $5 billion do to the Coalition for green Capital yes that's billion according to IRS tax forms this organization had revenue of less than 3.5 million in 2023 providing such large infusion of capital more than
▶ 0:01:301,400 times the organization's Revenue in 2023 raises concerns and the ability of the organization appropriately manage the volume of funding is something we are going to look into I hope president Trump looks into I'm sure he will I hope Elon mus 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 based on the facts before us does not have a demonstrated history of managing such large amounts of money the committee
▶ 0:02:01has 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 is 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 continued our efforts to ensure that
▶ 0:02:31the people's money is sound and we are not funding our foreign adversaries that we are safing safeguarding taxpayer dollars some self uh self dealing coll collusion and 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 the beginning of us looking into it and I will yield to the vice chairman my remainder of my time thank you for using your time chairman Guthrie I'd also like to thank you and chairman Palmer for holding in this hearing today
▶ 0:03:01it's vitally important that this subcommittee conduct proper oversight of the billions of dollars spent on the Democrats green new deal policies over the last four years the infrastructure bill and the IRA provided approximately 100 billion in supplemental funding to the EPA that's 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 that the Department's Loan program office was administer administrating more than 385
▶ 0:03:32billion 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've all seen the links of the Biden Administration went in order to hand out cash to far-left activist groups they even went so far as to give two billion to a group called powered forward communities this organization reported just $100 in revenue for the the entirety of 2023 but
▶ 0:04:02President Biden's EPA thought they were worthy of $2 billion do in taxpayer dollars I'm grateful the Trump Administration has taken action to ensure we're properly reviewing the funding and loan programs and root out waste Fraud and Abuse at the department of energy in EPA I'd also like to thank all of you for being here today and I look forward to hearing what you're doing to shiny light on the spending spree Mr chairman I yield back the chair now recognizes the ranking member of the full committee the gentleman from New Jersey Mr palone
▶ 0:04:32for five minutes thank you Mr chairman I have to say I'm genuinely shocked uh that we're having this hearing today uh it was talked about self-dealing when I go home the only self-dealing I hear about is from my for my constituents is the self-dealing by Elon Musk if we 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
▶ 0:05:02at 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 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 should additionally be filed by the inspector generals of the two agencies
▶ 0:05:33after all these are the Senate confirmed officials charged with fiing out waste fren 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's not that
▶ 0:06:03he didn't like uh that particular people responsible for looking for Waste Fraud and Abuse because he filed all the IGS it's 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 keyth federal Workforce speaks volumes earlier this month we urge Republicans to hold a hearing on President Trump's sweeping Purge of IGS throughout the
▶ 0:06:33federal government but to date they've refused and yesterday committee Republicans opposed an amendment to the committee's oversight plan to ensure the independence of Inspector General so they can continue to fulfill their legal responsibility to conduct nonpartisan and objective oversight and all this Republican in action demonstrates the committee Republicans are simply paying lip service to investigating waste FR and abuse they would rather play politics and actually conduct productive oversight in fact Republicans have wasted two years and
▶ 0:07:03held 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 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
▶ 0:07:34families and improving our energy security they'll 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's another effort by Republicans that justify stealing investments from American communities in order to pay for tax cuts for billionaires and big corporations they're also pushing ahead with their attempts to strip healthc care away from millions of Americans by cutting at least $880
▶ 0:08:04billion 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's ridiculous uh that this uh is what Republicans are choosing to conduct oversight on today so they remain complicit with their silence and will keep calling it out uh but with that Mr chairman I yield back the balance of my time we
▶ 0:08:34now 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 Miss Nicole merley acting Inspector General enal at the US Environmental Protection Agency Mr J Alfredo Gomez director of Natural Resources
▶ 0:09:05environment team and the US government accountability office Mr Jonathan black Chief advisor for strategic planning and program oversight Office of the Inspector General at the US Department of energy and Mr Frank uh rusco director at the national uh resource environment team in the US 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
▶ 0:09:35any 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're entitled to be accompanied by counsel do you desire to be accompanied by counsel during your testimony today in that case if you would please rise and raise your right hand I will swear you in do you swear that the testimony you're about to give is the truth the whole truth and nothing but the
▶ 0:10:05truth you're now under oath and subject to the Penalty set forth in Title 18 1001 of the United States um here let me get to the right page with that now we will now recognize Miss merley for five minutes to give an opening statement good morning chairman Guthrie chairman Palmer ranking members palone and Clark
▶ 0:10:36and members of the subcommittee I'm Nicole merley 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 long-standing 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 CSP programs and operations and drive a Improvement improvements in efficiency and Effectiveness in line with that mission today I will discuss our concerns regarding oversight
▶ 0:11:06of more than 40 billion dollars 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 epao has repeatedly flag systemic issues regarding the agency's internal controls particularly data quality and the management and oversight of federal funding
▶ 0:11:36recipients such as grantees two years ago we warned that these issues could undermine the epa's iig 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 allot billions of iig dollars to States for lead service line repl placement for two states alone we identified nearly $1 billion in questioned cost and funds put to better use in another
▶ 0:12:06example 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% of the buses funded by those rebates have been delivered to schools reviews of these programs yielded nearly $2 billion in monetary impact with our unique Authority
▶ 0:12:37our 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 iig 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
▶ 0:13:07expiration 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 iig the IRA does not include funding for EPA oig oversight we have have already received reports of waste Fraud and Abuse related to Ira programs as well as allegations of retaliation from whistleblowers coming forward
▶ 0:13:37to 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
▶ 0:14:07the fact we briefed more than a thousand 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 subres and screening for potential conflicts of interest with roughly 93% 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
▶ 0:14:38that received $147 million in IRA and iiga 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 in the environment and more than 1 billion taxpayer dollars at stake it's essential to learn from the past we are confident that
▶ 0:15:08with the continued support of Congress and the administrator's commitment to tackling waste frought 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 chair recognize Mr Gomez for his opening statement for his testimony chairman Palmer chairman Guthrie ranking member Clark ranking member palone and members of the subcommittee good morning thank you for the opportunity to discuss our work on how the EPA is using over hundred billion dollar
▶ 0:15:38provided by the infrastructure investment and jobs Act and the inflation reduction act the iig 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
▶ 0:16:08statement 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 iig water related funds and the IRA funds the iig provides ided 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
▶ 0:16:38states 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 waste water 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
▶ 0:17:08Congress 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 convene recommended a formula that is based on State's clean water needs as well as population and poverty would be better now Switching gears the IRA provided
▶ 0:17:38EPA 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 to 27 billion for the greenhouse gas reduction
▶ 0:18:09fund 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
▶ 0:18:39and 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
▶ 0:19:10this 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
▶ 0:19:41progress 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
▶ 0:20:11applications our our ongoing work will assess epa's process for making spending decisions and its oversight of these monies chairman Palmer ranking member Clark members of the subcommittee this completes my statement I'd be happy to questions chair recognize Mr Black for testimony okay I think I've got a red light chman Palmer Vice chairman balderson ranking member Clark and members of the subcommittee my name is Jonathan black
▶ 0:20:41I currently serve as the chief adviser 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 for those for those acts thank you thank you for inviting me to testify today in 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
▶ 0:21:12and 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 author 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
▶ 0:21:42and 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 thirdparty expert reports
▶ 0:22:13covering 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 the Third Party Experts proper management of conflicts of interest requ 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
▶ 0:22:43and waiver requests and did not share and cross check that information with 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 LP'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
▶ 0:23:14needed 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
▶ 0:23:44January 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 of underscores our concerns about whether it is possible to 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
▶ 0:24:14for both of these projects lpo lpo had 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 Project's 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 in
▶ 0:24:44Construction 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 LP's own expert advisers duly identified and called out the loan applicants mitigation meas Mees as being insufficient that may pose risks to the viability of the financial side of the project and these often covered only 25% or less of the needed Revenue protection or cost control further the mitigation measures were largely arranged with related parties oftentimes
▶ 0:25:15relying upon shaky Financial positions in looking through the credit review board meeting minutes they indicate a willingness to approved 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
▶ 0:25:45to advance transparency and to prevent and detect fraud Wass and abuse I appreciate the opportunity to testify and I look forward to your questions chair now recognizes Mr rusco for his testimony thank you chairman Palmer ranking member Clark and members of the subcommittee thank you for the opportunity to speak about our work on does IRA and iig spending my testimony today focuses on two doe offices that each received a lot of money from the iig
▶ 0:26:15and Ira Do's office of clean energy demonstration or Ed 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 iig about $22 billion and the IRA about5 billion through September 2024
▶ 0:26:46osed had awarded almost $19 billion most of this went to four areas including 1010 billion for industrial decarbonization and carbon capture projects 8 billion for regional hydrogen hubs and $1 billion for advanced nuclear projects since October 2024 oset approved another $6.6 billion do mostly to hydrogen hubs and Industrial decarbonization processes
▶ 0:27:16only 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 osed money is matched by private sector Partners when we audited osed in 2023 and 2024 we found that the office had adhered to a number of recommendations we had made regarding
▶ 0:27:47past doe carbon capture and advanced nuclear demonstration projects oset 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 osed 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
▶ 0:28:17going forward Doe's loan programs office or lpo oversees loans and Loan guarantees across five different programs in including auto manufacturing nuclear power biofuels and Renewable Power lpo first issued a loan in 20 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
▶ 0:28:48billion 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 billion of that amount 24.4 billion was awarded in the last quarter of 2024 and about 25 billion was awarded in January alone we will be conducting future work looking at the LP's
▶ 0:29:18overall processes but I can say today that my biggest concern for the lpo is a rapid and increasing pace of loans that were issued in the last four 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 osed and lpo going forward it is important to note that for both oset and lpo awards the money typically goes out in tranches as projects
▶ 0:29:49successfully 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
▶ 0:30:19have lost staff and the services of contractors as a result of resignations dismissals and 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 award e is spent wisely thank you I'll be happy to answer any questions the has thank you for your testimony and we will now move into the question and answer portion of the hearing that the chair recognizes the vice
▶ 0:30:49chairman of the committee the gentleman from Ohio Mr ballson for five minutes thank you Mr chairman uh thank you all for being here today it's 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 2024 that the administration was on track to exceed its goal of obligating over 80% of available Ira grants funding by the end of Biden's term
▶ 0:31:20moreover former secretary Jennifer granholm was quoted in October 2024 as saying that she is racing to commit funding and get signed many of us are also familiar with the video in which a special adviser for implementation within the Biden administration's EPA was caught on camera saying that it's truly like we're on the Titanic we're throwing gold bars off the edge the special adviser also said that they were trying to get this money out as
▶ 0:31:50fast as possible before they come in and stop at all it is clear from the video that the individual is 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 um your testimony notes that between November 2024 and January 2025 the department appears to have accelerated its processing
▶ 0:32:20and 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 five loans closed as compared to 20 loans closed in the last five months of the
▶ 0:32:51ad Biden Administration your testimony your testimony notes that the increase in Pace underscores concerns about whether it's possible to conduct robust due diligence to protect taxpayer dollars under such time pressures can you elaborate on that statement certainly yes the uh the 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
▶ 0:33:21review by the lpo the uh The Limited work that the office of Inspector General did on the two file reviews that we went to so far in depth uh seemed to indicate that there was a a tolerance that the lpo leadership had for accepting risk that may not be fully protective of the taxpayer interest thank you you also mentioned in your written testimony
▶ 0:33:51that your office was looking into some of the risk mitigation measures or lack thereof we touched on that regarding two recent ly 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 expedited loan or loan guarantee could impact having the appropriate risk mitigation measures in place certainly one of the common thing things that the large Capital financing
▶ 0:34:21energy construction project industry has is to try to write in guarantee sales agreements they call them offtake contracts to assure that the project that is borrowing a billion dollars or or or more has guaranteed accounts receivable guaranteed sales so as to finance and service the loan going forward the the more you can lock down as far as revenue is concerned the safer the project VI Financial viability is and the safer the taxpayer is protected from you know risk of default
▶ 0:34:51similarly they have these risk mitigation measures structured on the cost side where they have uh Construction contacts terms and conditions that seem to lock down the the and guarantee that cost overruns don't occur during construction and so uh this this indeed was engaged in these kind of strategies were engaged in by the lpo and uh but for the two files that we reviewed there we found that there was very minimal uh guaranteed sales agreements and very
▶ 0:35:22minimal cost controls on the construction side to control cost thank you um follow up to that and you'd be answer 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 uh the uh the the due diligence process that the lpo goes through is rather extensive and they have some worldclass experts commenting to and helping the lpo with this decision-making process
▶ 0:35:53and our overriding concern is that the lpo may not have given appropriate consideration to those results thankk you very much I yeld back Mr chairman chair recognizes chair now recognizes the distinguished ranking member uh from New York Miss Clark for five minutes for her questions thank you very much uh chairman and I thank our panel of experts for appearing here today in
▶ 0:36:23calling 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 General 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
▶ 0:36:5319 inspector generals without providing any not notice or justification to Congress as the law requires Trump had even handpicked the doe and EPA Inspector General before excuse me during his first Administration making their removal even 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
▶ 0:37:23left doe oig last week and and I've been told that your last day with doe oig is is this Friday is that correct that's correct I've also learned that 39 doe oig staff chose to take this deferred resignation program that was pressed on them this represents 133% of doe I oig's staff including five senior executive
▶ 0:37:53staff is that also correct yes your numbers are accurate thank you Miss merly obviously the former Inspector General sha odonnell was unceremoniously fired by Donald Trump but has your office also experienced departures of personnel and hiring challenges recently we have not experienced departure of personnel however we had um I have the number I think it's 32 individuals
▶ 0:38:24in various stages of the hiring that were frozen as part of the hiring action and a total of 32 individuals um or 23 individuals who responded to the Deferred resignation program and we're still evaluating the impact of that on our ongoing work 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
▶ 0:38:54by the Trump administration's all out assault assault on agency oig's 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
▶ 0:39:24does 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 rcco um I I do I do think that the the uh agencies will have a challenge to um restructure how they do their work in order
▶ 0:39:55to monitor the money that's out the door that they need to toh follow to make sure that additional tranches of funding are are are issued uh in a wise manner so I I do I do think they're going to have a challenge there Mr Gomez yes so we we've done a lot of work looking at Grants management Workforce and as you know EPA 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
▶ 0:40:25with 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 thank you uh the Trump Administration is picking the pockets of millions of Americans and Democratic and Republican districts every day that goes by where the administration ignores court orders by withholding award funds in another day is another day that America's progress is
▶ 0:40:55delayed 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 chair now recognizes
▶ 0:41:25the chairman of the full committee Mr Guthrie four five minutes for his questions thank you I can I can assure the committee that we are going to investigate and look at waste Fraud and Abuse and we'll be I think we're beginning this is just a beginning hearing I I'll tell you that and think about this so you had the greenhouse reduction fund $27 billion there is the Coalition for green Capital that we said the year before this had $3.5 million is what we could find under their income they get A5
▶ 0:41:57Grant that's facts that's not making anything up and if you don't think we should look into a $3.5 m million doll company getting A5 billion dollar worth of income and then so then that so they announced on January the 22nd it was providing 200 million of its five billion to a company called greeny re based on the state of Vermont's records an organization with this name was recently Incorporated in October 2024 a few months
▶ 0:42:27after EPA selected the Coalition for green Capital to receive its award according to greeney re's webbsite one of the organizations initially behind its formation was the coalation for green Capital so coalation green capital is a $3.5 million company gets $5 billion greeny re is Incorporated in October of 2024 um and they have on the website that one of their initially behind their Co is the Coalition for green capital is behind their organiz ation
▶ 0:42:57I'm concerned about what this brings what this so is I'm just describ ra the process I just described raises questions about a EPA has been monitoring the program so M merley your written testimony notes that effective monitoring of grant or loan recipients and subrecipients is critical internal control for Grant making agencies like EPA based on examples like the one I just provided your knowledge of recipient and subre relationships and epa's Grant Management practice what is our EP PA's oig's
▶ 0:43:28concerns with the recipients ability to monitor subrecipients particularly when the subrecipients have a relationship with the recipient so we um our concern is and it's been a continuing concern of Grants management and looking at the capacity um of the recipients and the sub recipients to handle um the money that they've been given um and I think what you're talking about is due diligence and conflicts of interest
▶ 0:43:58in um grants or other programs which is certainly something that we are interested in look into um I'm not sure I understand um the the question about the subrecipients well the sub the the subrecipients if it is a creature of the recipient and the sub recipient is there you have concerns with that under that fact it would be something we would look at for uh 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
▶ 0:44:29went out what rules were put into place what parameters what guidelines that would definitely be something would you be concerned that in October of last fall a company was incorporated and all of a sudden they're getting a $200 million Grant would that be something that would flag if if that was the the evidence that was presented um that would be a concern that would be a risk so let me go to Mr Gomez as relatedly I'm also concerned about the oversight conducted of recipients and subrecipients to ensure their meeting performance goes you're written statement noted that EPA officials said they had
▶ 0:44:59not yet developed program level performance goals and measures for the the three subprograms of the G greenhouse gas reduction fund and they need one to two 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 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
▶ 0:45:29those performance uh goals and and measures but those are important I mean our 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 subg grantees or at the end at the end maybe the beneficiary so understanding what that process is looking at what controls are in place what reporting requirements to make sure that you're safeguarding again would would you be extra concerned if an entity had a $3.5 million Revenue got
▶ 0:45:59a $5 billion Grant a company was created that had a I forget that I think it was a just created in October 24th and they got a $200 million grant that was a subrecipient of that company I mean I think it would raise a flag for us because we'd want to sure 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 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
▶ 0:46:29right appreciate we are going to be and my time's expired but we will be looking that as so thank you for that uh you'll back thanks gentlemen the chair now recognizes the uh ranking member of the full committee Mr palong for five minutes for his questions thank you chairman in less than two months we've watched Elon Musk and president Trump bracingly 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
▶ 0:46:59without 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 Elam musk this one directing recipients to respond with a list of what they did last week by Monday at midnight
▶ 0:47:30otherwise they'd be terminated and that of course sparked further confusion I I ask unanimous consent uh Mr chairman to enter an article from The Washington Post about this uh latest musk email if I could I'll give you a copy of it without objection so ordered 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
▶ 0:48:00and Loans uh Miss um the um grants uh capacity of the the agency to um oversee its grants and management um we actually have a report that will be coming out talking about the agency's capacity to manage its grants and so um yes that would be a concern thank you and Mr Black let me um I know it's your last week and so I want to thank you for your service um but if I could isue that same
▶ 0:48:30question you want me to repeat it or you 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'll perhaps slow work down in order to do a quality job thank you and Mr Gomez yes so our past work on that subject shows that you need the right staffs with the right skill set in the right places thank you Mr rusa yes I can give you a specific
▶ 0:49:01example in the um office of clean energy development uh among the 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
▶ 0:49:31or um projects that that private sector spent a lot of money on could be delayed or cancelled so it is troubling 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 post closure monitoring of finalized loans
▶ 0:50:01earlier this month 45 staff at the loans program office was 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 certainly reductions of staff at the lpo would absolutely have some impact on their ability to process uh loan applications and would certainly have some impact on the ability to monitor those loans
▶ 0:50:32over time 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 frud and abuse and Grant programs they would be holding the administration accountable by doing real oversight work instead of smearing award recipients who are just trying to to build a better future for this country that's my opinion I don't have another question but I I just you know
▶ 0:51:02again as I said I I can't believe the focus of this hearing today uh it's not what uh I'm hearing at home when I go home everyone's worried about freezing of funds uh uh termination and firing of people tariffs uh I mean people are generally concerned that these Trump policies are going to lead to a recession that's what they're telling me you know the market is uh going up and down uh retail sales are down at all-time low I'm just
▶ 0:51:32afraid and this is what I'm here we're headed towards a recession with these Trump Republican posits I hate to say that because that's not what I want to see I yield back Mr chairman chairman now recognizes gentleman from Virginia Mr Griffith for five minutes for his questions thank you very much Mr chairman 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's being spent they don't understand and how it cost so much money to do the things that they probably could do themselves a lot cheaper so I'm hearing different things than
▶ 0:52:02than my good friend Mr palone is hearing now let me start off on this hearing and say that I'm proud of the work that this subcommittee did last Congress oversee the implementation of the clean School Bus rebate program additionally I will say electric buses work for some schools but this program was a set up was set up in a haphazard way and in some cases school districts have not received all the buses they paid for Miss merly as your office has since completed additional work on the program can you provide any updates on epa's efforts to appropriately monitor
▶ 0:52:32recipients use of rebate funds um 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 um more internal controls on the recipients use of those funds um compared to what they had done in 2022 which is not put any um controls on the recipients use of those funds and what happens when you don't put any controls on the recipient's use of funds A lot of it gets frittered I won't use waste
▶ 0:53:03Fraud and Abuse because my colleagues on the other side hate that term but it gets frittered away does it not the risk is there substantial wouldn't you agree yeah it's a it's a risk um situation when you have uh no restrictions on um the funds and they sit in accounts for a while or they're comingled which you can say there's substantial risk come on you can say it there's substantial risk all right and is your office specific speically aware of the line electric case where the electric bus manufacturers now bankrupt and we have seen uh the
▶ 0:53:33news reports and and share the concerns reported we don't um comment um we have a longstanding policy of not commenting or confirming on um investigations thank you I appreciate that I mean that tells me there's an investigation I'm pleased um from an auditing methodology standpoint can you can you help me understand how the use of rebates and maybe it maybe it's different when you have substantial controls but how the use of rebates makes organizations agencies Etc more vulnerable
▶ 0:54:03to having problems similar to the line electric situation so the use of rebates does is um different obviously from putting out a grant and grants are longstanding vehicles for getting money to um recipients so they have more controls in place there's rules they're written up front um they 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 um because it doesn't have the same level of internal controls
▶ 0:54:33that a grant would have all right I appreciate that in your testimony talking about the clean School Bus rebate program you state quote although the deadline for completing projects was October 2024 as of February 2025 only 43% of the buses funded by the 2022 clean School Bus rebate program have been delivered to the schools end quote is your office aware of any other issues that have contributed to so
▶ 0:55:03many uh B of the buses not yet being delivered and recipients missing the deadline I don't have that information today but I'd be happy to submit it for the record I do know that we have um continuing audit work related to the clean School Bus program and oversight of the grant programs established there now I know you can't talk about ongoing investigations but do you have any idea or any information you can share and I open it up if somebody else has information to share on what happens to the school systems that we're using line electric fortunately none of those are in my
▶ 0:55:34district but that we're using the line electric because now they can't can't get serviced can't get parts and and they basically have useless Halles as I understand it from media reports do you have any additional information I do not all right does anybody else on the panel have any information on that particular subject matter all right well this is why we we have these hearings so we can identify problems and we'll probably come back and ask additional questions at a later date at this moment Mr chairman I yo back thanks gentlemen the chair
▶ 0:56:04now recognizes the gentle woman from Texas Miss Fletcher for five minutes for her questions um well thank you so much chairman Palmer I'm glad to work with you and everyone here on this important subcommittee in this Congress um and I think the testimony this morning has been useful and important and certainly uh we are addressing things of great concern to all of of us I think um I think all of us are concerned about um ensuring that our government
▶ 0:56:35functions efficiently effectively and ethically and that's why we appreciate the work that the office of uh 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 uh certainly I want to associate myself with the uh with the comments of our chairwoman and I me of our ranking member uh on on my
▶ 0:57:05side of the aisle um and with um with our ranking member of the full committee Mr palone about the concerns that I'm hearing at home in my district from my constituents um about recent actions that have uh not demonstrated either efficiency or Effectiveness um or uh or ethical and responsible governance um and and that there is a a great deal of concern and so I want to ask a few questions about that and kind of go go straight to
▶ 0:57:35them I want to start um with you miss merly um recently uh at the at the direction at the behest of President Trump and Elon Musk um the EPA in region 6 which is my region uh decided to place every NEPA permit reviewer on administrative leave so for Texas Arkansas Louisiana New Mexico and Oklahoma there are
▶ 0:58:05no EPA employees to do uh NEPA reviews at this time um as I think everyone knows this is a hub for energy and infrastructure projects um in this in this office um with those States and 66 tribal Nations um do you do expect uh 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
▶ 0:58:36applications perform NEPA reviews um I think that's a question better directed to the agency but I will say that we have concerns um about the workforce planning um and the amount of people available to do the work of um the agency thank you for that I think that ties into something um Mr Gomez that you uh talked about in your testimony and your written testimony you talk about several GAO recommendations to address Workforce challenges
▶ 0:59:06at EPA um specifically in EPA grants management and they included persistent Staffing level declines and burnout um that was causing High turnover and so I think that sounds consistent with what I'm hearing from Miss merley um about Staffing concerns at EPA um would you agree with me that arbitrary firings will negatively impact epa's ability to implement those GAO recommendations I mean I think we would look at you know
▶ 0:59:36where 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 uh if it's across the board then then it's having impacts in various programs so uh and so yes if it's if fits in those areas where people need to take action um then that we may need to be or we may be waiting to uh for folks to take that action well and I guess
▶ 1:00:06maybe more broadly my question would be um I mean certainly you would agree with me if you are concerned about employee retention employee morale that arbitrary firings threats to employees abusive treatment of employe employees are problematic for employee retention uh and carrying out the efficient um administration of the agency's responsibilities I would agree yes okay and I want to talk about one other thing with the time I have left Mr Black you spent
▶ 1:00:36a lot of time in your testimony talking about conflicts of interest um and I think it's really important that you rais that um and I'm going to ask you for the record to explain generally kind of why uh conflicts of interest are problematic and of concern to you um but for for our purposes here would you agree with me that Federal conflicts of interest statutes and financial disclosure requirements are important yes absolutely and federal officers are prohibited
▶ 1:01:07from participating in government matters that affect their financial interests correct that is my understanding yes 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're complying with those conflict of interest rules that's correct okay and so I'm out of time here and I'll just say that certainly my constituents are deeply concerned about uh the kinds of things that we are seeing and the conflicts of interest that are emerging um and quite clear in
▶ 1:01:37the department of government official with that I will yield back thank you chair recognizes gentleman from Texas Mr Weber for five minutes for his questions 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 Administration programs Rd 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
▶ 1:02:07G 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 blackham coming to you how would the administration's Department of energy support programs like the adrp to ensure that they're successful in advancing the next wave of energy um I know you're leaving but yeah unfortunately I didn't come prepared to talk about the
▶ 1:02:37advanced nuclear energy program rather my statement was prepared for the loan programs office okay so I don't have any particular details to share with you about anything about the advanced nuclear M merley do you have any details on that I do not Gomez Mr Gomez I would defer to our director on Frank Frank you're up thank you um well Congress does appropriate money to the to the uh office of nuclear energy and and and also there is some money
▶ 1:03:08in the office of clean energy development for uh nuclear projects um so I I guess yes it would it would be incumbent on Congress to to appropriate money specifically to support um uh new nuclear technologies and I I think that's uh would be well warranted taxpayers are helping fund these Innovative projects but it is unfortunately with the Biden doe and ep one hand has not apparently the left hand has not been talking to the
▶ 1:03:38right hand I guess that's 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 keyword they're 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
▶ 1:04:08this of over 160 permits did y'all know that did you know that Miss Merlin um I knew there was a a um we have ongoing work in the class six Wells program looking at the epa's ability to um meet its timelines and goals uh in permitting in getting permits for those Wells Mr Gomez were you aware of that I was not aware of that number no Mr Black uh no sir that is not information that I've done oversight work on
▶ 1:04:38Frank Mr rusco or rco Risco yeah okay he kind of outed you um is that a concern Mr Gomez that all the backlog of these permits yes I think as we were talking earlier right is that the the the backlogs can have an impact right and you know Frank was providing earlier an example of how uh not getting the reviews done can have impacts down the so Mr Black
▶ 1:05:10impact uh yeah we we have not done oversight work on on NEP applications um at all lately so I'm can you define lately for me last six weeks six months six years that I'm aware of is is is yeah in let me be clear so I don't represent the oig as a whole um I came here prepared to talk about the oversite work that the DU oag does with regard to inflation reduction act and iig act I can say that in my perview in
▶ 1:05:40my portfolio work we have no ongoing work on NEPA applications and sighting Russa we don't have ongoing work in that we we have recognized for years and years that permitting is a is a huge Challenge and um so being able to to uh do NEPA um analysis in a timely fashion important I'm going to come back to you Mr Black and see do you agree that the efficient review if this was in your purview do you agree the officient review class six permits is critical for getting
▶ 1:06:10carbon management project like those funded by do off the ground with the goal in mind that taxpayer dollars aren't being wasted that would certainly seem to be a reasonable statement absolutely and could we add that to the end of that statement the fact that we want those businesses to be successful get off get up and running off the ground as it were and to be able to actually capture more carbon sequest carbon and store it underground would that be a good a good goal uh I I personally would find no fault
▶ 1:06:40with that statement I don't understand why that hasn't been a priority Mr chairman I yeld back thank the gentleman the chair now recognizes the gentleman from New York my friend Mr tono for five minutes for his question thank you Mr chair let me congratulate to working with you um we have never seen a president encourage lawlessness or inflict pointless suffering on Americans at the scale we are seeing today nor
▶ 1:07:10have committee Republicans failed more egregiously at holding the president accountable than they are doing right now that failure threatens Americans access to safe and 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 storm water infrastructure across our great country in my district this funding is helping to replace thousands of lead pipes that pose
▶ 1:07:40a tremendous risk to people's drinking water I've 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 PA 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 recom recommendations focused
▶ 1:08:11on 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 BAS based on gao's past work would drastic Workforce reductions impact um epa's ability to manage drinking water and wastewater
▶ 1:08:43anybody um I'm going to start this uh this answer and perhaps I'll turn it over to the IG from EPA um so so yes the as as you said uh Congressman tono a big ustion of funds to the state revolving funds uh there's 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 um so those monies go to the states that that EPA provides and the states themselves revolve the
▶ 1:09:13monies down to the uh to to the water utilities to make sure that those are working well so yes our our work has found that it's important for those State revolving funds to be working and that the folks that work to to provide that are there uh but it's really then the states and the local uh utilities that are doing the work right for for for all of us to ensure that we have clean clean drinking water but getting those dollars out in an
▶ 1:09:43effective and efficient way is important with the states is important 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 apaa Miss Murphy were you going to say something 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 the people that um you know um that need the money and the money is
▶ 1:10:14is getting out 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 question I mean yes that I I do agree with that statement right if these are the people that are supposed to do the job and if they're not there the job that job isn't being done these are answers that I tried to get by going to EPA but uh uh not a Welcome Wagon there it's not just EPA or our drinking water
▶ 1:10:44infrastructure 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% of its staff overnight we don't know what the calculus was what the awareness was we've got inspectors General that can advise but yes they're being let go too so even
▶ 1:11:14though Administration officials quietly scaled back The Purge n nsa's important St 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 Rusk can nnsa effectively address any of the challenges GAO has identified
▶ 1:11:45by sewing chaos and confusion in its Workforce the gentleman's time is almost expired Mr rusco you may answer the question I can't speak directly to nnsa but it it is important to have uh to to to strategically look at your Workforce and if you're going to fire people or hire people hire and fire the right people that sounds what efficiency is all about so I hope we do finally get to efficiency as a model here thank you and with that I you chair now recognize the gentleman from
▶ 1:12:15Georgia Mr Allen for five minutes for his questions thank you chair Palmer for holding this important oversight hearing today and I want to appreciate the witnesses for testifying uh 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 is imperative that we do our due diligence to see just where that money went uh it's it's also important to understand
▶ 1:12:45uh you know what what people their job roles what they're doing and actually what they're producing uh which seems to get lost in all this uh these laws added to to our outof control government spending and as we have seen in Prior hearings some of this funding went to special interest groups uh with billions of dollars being given out rapidly it is critical that we see where American taxpayer dollars are going and uh that they are properly vetted uh there are a lot of questions surrounding epa's 27
▶ 1:13:16billion greenhouse gas reduction fund program particularly its decision to use a financial intermediary to hold program funding how that differs from other Ward mechanisms how EPA will monitor These funds and whether Americans will be able to see what these organization receiving billions of dollars are using their money for Mr Gomez to your no knowledge has the government accountability office ever seen a structure where a financial intermediary has been used for Grant making with n EPA or
▶ 1:13:46any federal agency So within EPA we're not aware of of that the federal government has used these Financial agents for a variety of different um activities in fact go did a report on it uh 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 yes that's correct yes uh miss merley when the EPA office of Inspector General
▶ 1:14:16became aware of epa's plan to use a financial interm intermediary to hold program funds what concerns did your office raise what rationale did EPA provide um it was a um at a meeting that we had where we were introduced to the program and um we asked questions about um the due diligence process that would be put into place uh the vetting um 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
▶ 1:14:47um we still have um we're still looking into that and in the questions um that we had so it's not been conclusive as to you know what whether this is the right way to do things here it was for us how do we conduct oversight of such a new program and something that we were not familiar with okay did they give you a reason why they're doing this um I I don't I don't have that um it wouldn't be that they have something to hide or anything like that or they
▶ 1:15:17uh don't want you to know what's going on or anything like that okay uh you know the committee has been examining the risk associated with epa's environmental justice Grant programs on October 16th 2024 uh your office announced it was conducting an audit of epa's fiscal year 2021 environmental justice collaborative program solving Cooperative agreement program in which 34 recipients were awarded funding under the 23 uh program I however EPA selected 98 recipients to receive fundings
▶ 1:15:47that's almost three times the number of awards made in 2021 merle are you concerned about epa's ability to monitor so many different recipients and awards I'm not familiar um with the additional program but we would always we always um are concerned that there's risks when you have um there there's been systematic um challenges that I raise with data but also with grants Management on both the um getting out the grants and then the proper monitoring of Grant
▶ 1:16:18recipients so that's continued that's a theme um for us in our oversight work of the EPA yeah and you know just like to each one of you if you've seen you know these these dollars go out rapidly to these Grant programs I mean what are your concerns and I'll start as ear with you I've got about 44 seconds I mean this is unprecedented as far as we know uh particularly with the the end of one Administration beginning of another Administration obviously with 36
▶ 1:16:49trillion in debt and of course my friends on the other side are questioning you know uh what y'all doing well we're trying to solve this issue so uh What uh what concerns do you have about what you've seen our concerns when you have a 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 where the processes followed What structures were in place and so that's always um what we would call a situation
▶ 1:17:19of risk right where there's risk involved when when those factors are in play all right I'm out of town but if you would y'all all would respond I mean you know I'd like to know if y'all follow where the money actually goes in other words you know how the money goes and where it ends up gent's time has expired I you back chair now recognizes the gentoman from Massachusetts Miss tram for five minutes for her questions thank you Mr chairman and thank you to our Witnesses here today uh at a Commerce manufacturing and trade subcommittee
▶ 1:17:50uh 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're 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
▶ 1:18:20people that they just fired one day my district has the funds to address storm water overflows the next day those funds are suspended and it's 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 bipartisan infrastructure law funded cleanup of the toxic Peach Tree Orchard Road
▶ 1:18:50groundwater 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
▶ 1:19:20district a factory that's being built with uh bipartisan infrastructural off funding that will produce lowcost 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 uh in clean energy production can help cut
▶ 1:19:50costs for consumers um uh and keep America competitive and resilient I think it's 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 well it is important it is important from the perspective of of the private sector when
▶ 1:20:20they enter a contract that that the terms of that contract remain remain the same throughout the throughout the process and when private partners are worried that the government might be inconsistent or unreliable what effect does that have on projects and taxpayer Investments well once a once a an award has been made for for a public private partnership for example uh if if there are delays that can that can threaten the project and cause Rising costs
▶ 1:20:51last year the GAO published a report on the department of Energy's office of clean energy dist uh demonstrations this office does the important work of partnering with the private sector to deliver clean energy projects at scale we're talking about major projects like clean hydrogen and advanced nuclear reactors including in rural communities where uh the energy and the infrastructure it's delivered through just costs more Mr rusco in that report GAO made two recommendations to improve
▶ 1:21:21Ed's approach to workforce planning and program man management both recommendations remain open do you think that the massive layoffs we've seen At Doe will improve the agency's ability to address either of those recommendations Ed spent over a year trying to build the workforce in order to make the the the awards that it did um and now that that a lot of that money is out the door it is time to
▶ 1:21:52uh you know invest in the monitoring sta they were already on that on that path um and I do know that in some cases some of the recent events that had had cost uh uh a contract that was designed explicitly to monitor awards that had gone out the door 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 inde definitely or recur why would businesses ever take the
▶ 1:22:22risk to invest alongside the government 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 yeld that gentle lady yields the chair now recognizes the gentleman from Idaho Mr fure for his questions thank you Mr chairman thank you for the hearing today
▶ 1:22:52this is uh is going to go to Mr as a Mr rusco and it has to do with reporting and and if I understand correctly at least from the written testimony inspector generals from both doe and the EPA have are citing uh lack of data as being problematic lack of data from potential recipients subrecipients uh in under ija and it looks like that
▶ 1:23:22has led to complications when it comes to the component and uh first of all I want you to to tell me my my reading this right and if so uh you know some of the reporting is pretty complex for some of these small municipalities and and so on especially in the arena of water and whatnot uh water uh Purity am I reading that right and if so uh talk
▶ 1:23:53to me about the reporting what can be done potentially to uh improve that or maybe identify the specific data that's needed 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 um 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
▶ 1:24:23away with and they're trying to improve that right so that you know yeah they have to do engineering reports for example but there's usually different there's duplicative reporting or applications to apply for different water programs for example so that is an area that that we see where communities across the country could benefit if there is uh not duplicative reporting or if they have the technical support to help them Mr rusco your comments and if that's in line with your
▶ 1:24:53thoughts what do sorry is that on um yeah I would defer to Alfredo on on on that P specific thing obviously for monitoring you need quality information from recipients and and you also need uh the appropriate staff to evaluate that in a timely fashion so so uh to that end we did follow up my staff help we follow up with some of our municipalities and the feedback we get is it's not
▶ 1:25:23the it's not the the monitoring or the reporting uh as long as they can get the data the specifics it's not the monitoring that they're um uh unwilling to do or or uh uh inconsistent with their objectives because they have to worry about lawsuits and all of that type of thing too but it's NE it's who they're interacting with sometimes and where that data is going and and and who's responding to them
▶ 1:25:53and uh theq for example Department of Environmental Quality in our state is is a much Preferred channel to interact with for especially the smaller municipalities once again I'd like to go get input from Mr Gomez Mr rusco how can how can we improve that relationship so that perhaps the local uh is is more involved as opposed to EPA sure so in in again in the water sector usually it's those EPA Regional Offices right
▶ 1:26:23like for for example Idaho I believe belongs to region 10 is that right I believe so yeah in in Washington so it's those Regional EPA staff that are working with the with the state of Idaho that department for example but also reach out to the uh small Utilities in those towns there's also uh a group called circuit writers that actually help uh these small communities uh get the data that they need put together engineering reports um so it's just
▶ 1:26:53making Mak sure those communication channels perhaps are open uh between uh the regional people at EPA the state people and then coming down to the local staff I mean we go out and talk to these dist these uh 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 okay Mr rusco I'd like your take with with this one added comment in my state as is not uncommon in the west the scope is so much bigger because the the Federal in footprint
▶ 1:27:23is is so large two-thirds of our land mass for example your CS your thoughts and we' only got about 20 seconds left I apologize well my expertise is on the energy side for energy Awards Federal Energy Awards typically the recipients are are private sector companies they don't have trouble coming up with the information as long as the contracts clear sort of what information is required or it's not so much funds going out to communities as it is in the water situation okay thank you Mr rusco
▶ 1:27:54Mr chairman I yeld back the chair now recognizes the gentle lady from Virginia Miss mlon for five minutes for thank you Mr chairman um and I thank you for holding this very important hearing I want to thank the witnesses for being here this morning um your work as we have discussed is very critical to making sure um we ensure the transparency and integrity of our government and so thank you for your work and some of my questions may
▶ 1:28:24have already been touched on uh but these are very important issues uh of concern and I want to make sure that I have a chance to put on the record because uh my constituents have have raised a lot of concerns about what's been happening over the past month uh where I had a town hall meeting with you know double the number of folks participating uh as usual um and I was deeply concerned when uh the president fired inspector generals from across 17 agencies
▶ 1:28:54including the EPA um as we've discussed today uh 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
▶ 1:29:24and hazardous waste laws and so miss merley 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 our office is has a staff of dedicated oversight professionals that are committed to um the Mandate that Congress gave us which is to prevent and detect waste Fraud and Abuse and to promote economies in and efficiencies at the EPA
▶ 1:29:55programs and that is what we are very cognizant that that's our mission and that's what we show up to work to do every day and I thank you for that Mr Black do you want to add anything yeah 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 if I may I know there's there's a lot of buzz in the media and in in
▶ 1:30:25in 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 the the department of Energy's office of Inspector General has a 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 I can offer some assurance that we are continuing to do our duties as as written in the IG act
▶ 1:30:55and um with or without ahead we've still got a deep and experienced Cadre of leaders who are going to make sure that this Mission continues to be addressed and and I'm glad to hear that and that's true of so many of our federal agencies and so many of our civilian federal Workforce our our military uh 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
▶ 1:31:25including over 300,000 federal employees in Virginia uh where I represent um 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 uh the federal Workforce even in cases where the people firing them had no clue what they did like protect our stockpile
▶ 1:31:55um and and these are 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 um and and and forcing employees to justify their very existence firing probationary employees
▶ 1:32:26um 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 sarily fired makes it very difficult to keep that Talent pipeline going um and so miss merley and Mr Black have your offices found any evidence that the mass firing of civil servants said any agency like EPA or the doe
▶ 1:32:56have actually benefited our country in the past month and you may we may not have time for you to answer here so I'll ask you to submit your answer on the record uh afterwards please can I we'll be to do so the gentle L's time has expired the chair now recognizes the Gom woman from Colorado Mr G for five minutes for her question thank you very much Mr chairman and um I apologize that we haven't been able to
▶ 1:33:27be here for the entire hearing Mr Carter and I uh he's the ranking he's the chair and I'm the ranking member of the health subcommittee we're in the middle of a hearing downstairs but we've been following what's been happening and we appreciate all of you coming uh today I particularly want to thank uh Mr Black and Miss merley for coming today uh from the offices of inspectors General At Doe and the EPA because it's your offices that hold our agencies accountable to prevent waste Fraud
▶ 1:33:57and Abuse I think it's a shame that former EPA Inspector General odonnell and former doe Inspector General Donaldson can't add to this conversation since they were unceremoniously fired by President Trump but I'm glad Mr Black to hear you say that 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 um because uh I I want to talk about that now Mr
▶ 1:34:27Black did any point in the last Congress when we had 20 oversight investigations hearings did any point that the former doe Inspector General presented this committee guidance of waste fraud or abuse as it relates to the grants we we have been performing a great deal of oversight work on Grant activities funded by the iig a and the IRA and uh We've certainly identified some
▶ 1:34:57internal control gaps that warrant some improvement and uh we do in fact have some investigations that so so let me ask let me ask the question did the Inspector General present any evidence of waste fraud or abuse in these grants to this committee last Congress yes or no I do not believe believe that the written statements included specific instances
▶ 1:35:27thank you now uh Miss merley did the former EPA Inspector General present any evidence of waste fraud or abuse to this committee as it relates to this uh these grants I would have to submit for the record um his past testimonies I don't have them um are you aware of any I I have um in the reports that I cite in our um in my testimony that there are instances of the we we found
▶ 1:35:58um waste or or funds that could be put to better use in some of the reports that we've done okay do you know that it and you don't know whether that was presented to this committee is that I don't but I can um okay I would appreciate you if you if you um supplement your your answer now over $262 million in funding from this clean School Bus program airport um infrastructure grants Energy Efficiency upgrades and other grants have been frozen in Denver which is my district the projects
▶ 1:36:28in Jeopardy were announced and put in motion between 20122 and the first half of 2024 well before the election and despite the claim that the Biden Administration quote was throwing gold bars off the Titanic so I want to talk for a minute about this in the context of wayte Fraud and Abuse one month into the Trump Administration all of these grants were frozen I would call that abuse because
▶ 1:36:58all the grants have been frozen and taxpayer money is just is just not being used um so miss merley I want to ask you a question could defying legal court orders to release the funds already obligated and allocated constitute a abuse of power I think that's a question um better directed to the AG agency and I can speak to um so if if they already gave the
▶ 1:37:28funds and then there was then the funds blocked and then a court said release them and they didn't wouldn't that be an abuse of power I think that's a question for the agency okay I I I guess I can understand why you wouldn't want to answer it um now since EPA zeldon was confirmed over 1,000 EPA employees have also been fired or placed on leave Miss merley isn't this reduction in Workforce antithetical to your office's own
▶ 1:37:582022 report recommending that EPA should enhance its grants oversight Workforce our reports have um recommended the EPA enhances grants Workforce as has our top management challenges identified that as a problem for the agency great thanks I yelled back chair now recognize the gentleman from Georgia Mr Carter for his qu five minutes for his question thank you Mr chairman I appreciate you giving me the opportunity to wave on and I thank all of our Witnesses for
▶ 1:38:28joining us today as we look to examine the Biden administration's energy and environmental environment spending a series of of decisions that drastically increase waste Fraud and Abuse in our already bloated bureaucracy in my own State the state of Georgia excuse me the Biden EPA handed out two billion that's B billion dollars to the Stacy Abrams back group power forward communities in April of 2024 power forward
▶ 1:38:59communities 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 in total revenue during its first three months in operation went from one $0000 to2 billion if that's not waste Fraud and Abuse I don't know what is but nevertheless
▶ 1:39:29Miss merley 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 um it would depend on the circumstances involving the complaint that was brought to our office um but we would look at um if we were talking uh the um conflict of interests in involved with EPA employees we would look at um the ethics um agreements involved the uh
▶ 1:40:00Financial disclosures of those individuals and then if we're talking about the so you do look at the disclosures yes in in in the situ the group or the individuals or both in that situation I was talking about the individuals but we would do um there there's two different um scenarios there's the uh EPA employees who are working on a program and then the conflict of the uh recipients of the federal funds okay would it would it would it um
▶ 1:40:31stroke your interest if you saw where a group had only had $100 in revenue for the first three months and then all of a sudden was being given a grant of $2 billion that would be something that we would be interested in sure looking at okay have you heard of this grant that was given to power forward communities and and before have you heard about this I'm sure you have I I've um not specifically the that one but um I don't recall you don't recall
▶ 1:41:01yeah okay there's been a lot there has been a lot but in the state of Georgia this is of as you can imagine of interest to us so um can I 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 y um yes we are initiating work um in uh the uh Ira
▶ 1:41:31um space at this this point in time to look at the EPA you were a little hesitant I mean I is that a yes yes yes thank you thank you um 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're we speaking to earlier when you say you're looking at the disclosures of the EPA officials as well as the group itself you look at
▶ 1:42:02um 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 did you look at this do you know before this money went out did y'all look at it I don't know off the top I would have to get that for the record can you get that for me for the record you know what what was looked at and and what concerns were expressed if any yes
▶ 1:42:32thank you I appreciate that Mr Black let me ask you this um 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 yes that is uh 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 the number approximately over five years so ISS
▶ 1:43:02over five years issuing and yet one month we had 46 billion dollar did that raise any oh yeah that is of concern to us and uh we are definitely looking into the facts and circumstances surrounding the pace with which those loans have been signed Mr chairman I I really do appreciate this hearing thank you for holding this on we need help here miss merley we we really do need help I look forward to your answers to my questions
▶ 1:43:33thank you Mr chairman I appreciate your opportunity to wave on and I yield back thanks the gentleman the chair now recognizes gentoman from Michigan Miss Dingle for five minutes for her questions thank you Mr chairman and I I love my colleague from Georgia he and I are working on many things together I hope you have that same standard of ethics and 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
▶ 1:44:03and that we need to be spending the money wisely and importantly not one penny should be misappropriated in any way and I'll 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
▶ 1:44:34to notice the jobs that those Investments are creating for American workers and even more importantly how they're lowering the cost for Working even you know our new EPA administrator has also attacked the greenhouse gas reduction fund and I want to make sure sure people are getting the right facts that they're not getting misinformation so I want to set the record straight again the greenhouse gas reduction fund was established
▶ 1:45:04by 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 workingclass communities the same communities that have borne the brunt of environmental pollution robbing
▶ 1:45:34them of their health and economic opportunities I've long been a vocal supporter of creating a clean energy accelerator because of its potential to make and manage Investments and 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
▶ 1:46:05private 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 sure every dollar is reached that products would not have otherwise been built but now it seems as if they're only focused on making it impossible for the greenhouse gas and
▶ 1:46:35reduction fund to succeed it doesn't have to be this way I know Republicans spent the last two 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 funds 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
▶ 1:47:05so I'm 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 GRE greenhouse gas reduction fund fail on the Republican side and that makes me sad it would be terrible for American workers and work in families the greenhouse gas reduction fund solar for all program was
▶ 1:47:35on track to support residential solar deployment efforts in every state that can save families 20% 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
▶ 1:48:05to make sure that the greenhouse gas reduction fund succeeds you all just want to keep betting against it and looks like this administration's 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
▶ 1:48:36and get us energy security and reduce consumers working those hardworking people who say they want to pay less in their bills so let's stop trying to make sure that it's going to fail I'm 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 costs and I would ask my colleagues here I think it's simply too important gent time has expired and I yield back CH
▶ 1:49:07the chair now recognizes gentoman from Florida Miss caster for five minutes for her questions uh thank you Mr chairman and thank you all for being here today uh just a couple of days into this new Administration the president illegally fired uh 19 inspectors General uh including uh the IG from the EPA and the department of energy these are vital public servants they're the cops on the beat that help help us root out waste
▶ 1:49:37fud fraud and ab abuse and make nonpartisan recommendations to Congress to act upon um the I'd like to know Miss merly has the illegal firing of the EPA IG delayed uh your oversight responsibilities in your office it has not has it complicated it has it taken time and energy away from tasks at hand um any change in any organization um
▶ 1:50:08brings a a period of time where things have to settle and in in um have have go ahead but I I will say and I'll e echo my colleagues point we have a dedicated staff of professionals oversight professional oversight professionals who are committed to the mission of the oig I and and I appreciate them have uh how many people have been fired or left out of EPA ig's office we have not had um any uh
▶ 1:50:38firings or people leave um we do uh we did have um about 32 I believe individuals I I need to get that exact number um uh who were in the process of being hired um that are caught up in the hiring freeze and we had about 23 individuals take the Deferred resignation program they okay and um for Mr Black same questions has the firing of the uh Inspector General taken time away as as M Murley
▶ 1:51:08said sometimes it takes time to settle when there are changes yes so I work in the front office and I work directly with and for the Inspector General as her Chief adviser and there was certainly some disruption when Terry Donaldson was removed however like I said in a previous line of questioning there's a a Cadre of Professionals of 300 plus IG accountants Auditors inspectors lawyers that continue to serve the taxpayer by preventing fraud waste and abuse and we will continue to do so and then what was what's been the change in Personnel from uh the
▶ 1:51:38beginning of the year to today uh we have uh 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 uh and and that's the only number that I have come here prepared with how long have you worked at the ig's office 33 years 33 years okay um you know the the other um illegal activity has been uh at the outset of this
▶ 1:52:09Administration the the shutdown and uh 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 um uh freezes on grants and Loans are illegal uh are you keeping track of how much money now is being illegally withheld that should be um you know part of the course of doing business I
▶ 1:52:39don't know if that's a number tracking okay and do you have um do you have any information on that account I do not um and I think those questions would be better directed at the agency okay Mr Black so uh two days ago I met with the top leadership of the Department's loan programs office and uh they clarified that although new loan closures are paused the dispersements for those loans that have been closed that are are active uh dispersements are being made
▶ 1:53:09after leadership reviews uh individual transactions and um dispersements are being made what grants and Loans are being Frozen right now they that that's a question best asked to the department but I'm aware and there's there's I mean literally hundreds of Grant programs and five loan programs but uh so that that's a complex question with a with a lot of moving Parts but they I'm informed by Department leadership that there is a process in place to um to
▶ 1:53:40to make dispersements for programs on a case-by Case basis as situations but I think the federal courts have ruled that they they don't have the authority to make they they they they don't that that's IL an illegal action to to withhold the grants and loans that are congressionally directed so you're saying that the agency has told you they're still they're still freezing uh they're still holding back funds that's that's not what I'm saying at all I'm informed by Department leadership that um
▶ 1:54:10that that dispersements are being made after review thank you you back thank the gentle lady I will now recognize myself for five minutes for my questions and I want to point out that we're 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 uh that is why a freeze would be appropriate to do the needed investigations to to attempt to stop the abuse of of American
▶ 1:54:41taxpayers um first of all M Mr Black thank you for your service um the ranking member claimed that my majority colleagues and I wasted time conducting oversight to these program programs concerning that we're sending out $240 billion during improper payments would uh 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 m merley is this a waste of time how about you Mr
▶ 1:55:11Gomez no how about you Mr Black absolutely not the more oversight the better how about you Mr Rosco no rusco I should say not Rosco that uh also um um Mr Guthrie chairman Guthrie and Mr Carter both raised this question about these uh grants that went to to relatively small entities uh in particular the one Mr Carter mentioned had a $100 uh in revenue and then then
▶ 1:55:41suddenly got2 billion doll doesn't that raise some serious questions about capacity of I mean aside for any allegations or suspicions or considerations about um the the possible possibility of fraud or mis misuse of the funds wouldn't that be a major capacity issue Mr Black capacity is a concern and uh the the the capacity to appropriately manage the the vast funds from the iiga and the IRA has
▶ 1:56:11been identified as a risk by the oig in the past and it remains our one of our shouldn't we be looking at where the money went because if if you go from $100 to $2 billion that should raise some serious questions about uh the capacity of the organization to handle that amount of money and maybe raise some questions about passrs these entities being set up as pass through Vehicles which I think uh we will look into at a later date miss merly my colleagues also expressed concerned about Staffing at the EPA office of Inspector General
▶ 1:56:41but they were not as concerned when they decided not to provide any funding for its oversight work in the ira uh did that pose any challenges uh for your organization when you had this massive amount of money blowing in it it does pose challenges because of resource constraints with our staffing um you know we did receive a uh funding for iig oversight and I think the work that we've done there demonstrates the good work that we can do and our ability to provide um
▶ 1:57:12results um when we're given the funds to do uh sufficient oversight with the IRA we are constrained to our core budget and about 40% of our audit work is mandatory so that's what's done by what we have to do by Statute um 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 and doing the best we can in that area okay Mr Black and Doc your office reported that the doe and LP doe lpo
▶ 1:57:42is administrating more than 385 billion in new Loan Authority without ensuring a regulatory and contractually compliant and effective system to manage the organiz ational conflicts of interest in the interim findings report uh 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% compliance rate across the loan program's office also referring to it as trust but don't
▶ 1:58:13verify can you explain the concern stemming from this lack of systemic management of organizational conflicts of interest certainly so the the finding that we are have identified and issued in that report concerned the lack of appropriate controls to document and do the crosschecking 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 Rel relations to who and stuff like that the
▶ 1:58:43the the department responded the the the prior Administration responded by disagreeing with the the the severity the impact the magnitude of the 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 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
▶ 1:59:13those comparisons and identifications of related parties identif you said something in your testimony that I took note of and and 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's why we're holding this hearing why we're going to continue to to dig into this and I I fully anticipate that we'll be uh inviting people back in to uh meet with us again uh
▶ 1:59:43with that uh I will yield back and and um I would like to thank all the witnesses for being here today members may have additional written questions for all of you uh I'll 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 Mr Black since Friday's 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
▶ 2:00:13documents included on the staff hearing documents list without objection that will be the order without objection the subc commmittee is adjourned