EPA Inspector General Raises Clean School Bus Fraud Concerns

The Clean School Bus Program “is rife with potentially inaccurate information,” according to the Environmental Protection Agency’s Office of Inspector General.

“We also identified instances in which entities lacking student enrollments applied for and received funding, imperiling the program’s principle of equitable resource distribution,” wrote Jason Abend, assistant inspector general, in a memorandum issued Dec. 27, 2023. “A major challenge we identified is that the EPA’s lack of clear and established verification protocols for the application process allows applicants to self-certify their eligibility, which could lead to inaccurate information being submitted to the EPA.”

Issues with Complete and Verifiable School Bus Rebate Information

Currently, the way the statutory text governing the program is written, the inspector general’s office is concerned because applicants aren’t required to “expressly attest to the accuracy and truthfulness of their Clean School Bus applications.” The EPA also has no mechanism for verifying an applicant’s supplied information.

The memo gives examples of instances, such as:

• A 2022 rebate recipient sought funding for buses that would serve “an administrative entity with zero students.” That entity was awarded funding by the EPA.
• Rebate applicants were selected for awards but hadn’t cleared the plan through the eligible school district. The districts later declined the awards. “Total withdrawals from the 2022 Clean School Bus rebates, including those school districts that withdrew because a contractor applied without their consent or knowledge, were in excess of $38 million,” the memo stated.
• In one case, the office had to conduct a six-month investigation – including interviews, surveillance, and subpoenas – to gather information that should’ve been in an application, including the identity of a contractor applicant.

What Comes Next for the Clean School Bus Program?

The EPA is currently accepting applications for the latest rebate funding round, with a deadline on Jan. 31. This week, the agency announced funding for the first round of Clean School Bus Program grants.

“Although we have not yet finished our review of the 2023 Clean School Bus rebate program, as it is still open for applications, our findings likely have applicability to this program as well, given its similarities to the 2022 rebate and 2023 grant programs,” the memo stated.

The office recommended improvement measures, including:

• Require applicants to provide supporting documentation.
• Establish a validation regimen.
• Require recipients to maintain a documentation archive.
• Highlight criminal penalties and require signed certifications.
• Require notarized attestations and certifications.
• Increase oversight of third-party vendors.

“By implementing these measures, the EPA will bolster the efficacy of federal award administration, enhance the authenticity of award applications, and elevate the integrity of the Clean School Bus Program,” the memo stated. “This proactive stance will serve the program’s envisioned goals of environmental enhancement, public health fortification, and economic advancement, while concurrently mitigating potential fraud, waste, abuse, or mismanagement of federal resources.”