CORPORATE FARMING NOTES
As reported in Alan Guebert’s Farm and Food File, the Inspector General of the Environmental Protection Agency (EPA) recommended earlier this year that the EPA recover nearly $25.2 million of the $25.4 million granted to America’s Clean Water Foundation in three federal grants between 1998 and 2003. The grants were awarded “to perform environmental risk assessments at agricultural facilities,” according to documents on the EPA Office of Inspector General’s website.
America’s Clean Water Foundation did not comply with EPA regulations regarding procurement of contracts under the grants in question. The Foundation spent over $21.1 million on contracts with the National Pork Producers Council (NPPC) and a for-profit subsidiary of NPPC named Validus Services, LLC (formerly know as Environmental Management Solutions). Validus and NPPC were contracted to conduct On-Farm Assessment and Environmental Review programs intended to “help producers identify and plan for addressing any outstanding critical swine waste management issues on their farms,” according to documentation on NPPC’s website.
However, the grants were awarded without competition and without performing the price or cost analysis required by federal regulations. EPA auditors questioned the $21.1 million claimed by Validus “because the Foundation was unable to demonstrate that the contract costs were reasonable, allowable, and allocable.” For example, Validus billed the Foundation for $1.25 million in licensing fees for use of pork checkoff-funded environmental assessment programs. But the National Pork Board, which administers pork checkoff funds, granted NPPC and Validus rights to those programs at no cost.
Recent calls to the EPA Inspector General’s Office in September revealed that the recommendation to recover the money has stalled, perhaps permanently, because they were informed in a July 14, 2006 letter from Foundation attorneys that the Foundation had been dissolved, over two years after auditors first uncovered financial irregularities relating to the federal grants.
Slipshod spending of $25 million in public money intended to assist pork producers in protecting water quality is offensive. What happened under these grants is worse because the smell of graft is as overpowering as the smell from the massive industrial hog operations for which they were intended.
Contact: John Crabtree, johnc@cfra.org or 402.687.2103 x 1010, for more information on the Center’s Corporate Farming Notes.
America’s Clean Water Foundation did not comply with EPA regulations regarding procurement of contracts under the grants in question. The Foundation spent over $21.1 million on contracts with the National Pork Producers Council (NPPC) and a for-profit subsidiary of NPPC named Validus Services, LLC (formerly know as Environmental Management Solutions). Validus and NPPC were contracted to conduct On-Farm Assessment and Environmental Review programs intended to “help producers identify and plan for addressing any outstanding critical swine waste management issues on their farms,” according to documentation on NPPC’s website.
However, the grants were awarded without competition and without performing the price or cost analysis required by federal regulations. EPA auditors questioned the $21.1 million claimed by Validus “because the Foundation was unable to demonstrate that the contract costs were reasonable, allowable, and allocable.” For example, Validus billed the Foundation for $1.25 million in licensing fees for use of pork checkoff-funded environmental assessment programs. But the National Pork Board, which administers pork checkoff funds, granted NPPC and Validus rights to those programs at no cost.
Recent calls to the EPA Inspector General’s Office in September revealed that the recommendation to recover the money has stalled, perhaps permanently, because they were informed in a July 14, 2006 letter from Foundation attorneys that the Foundation had been dissolved, over two years after auditors first uncovered financial irregularities relating to the federal grants.
Slipshod spending of $25 million in public money intended to assist pork producers in protecting water quality is offensive. What happened under these grants is worse because the smell of graft is as overpowering as the smell from the massive industrial hog operations for which they were intended.
Contact: John Crabtree, johnc@cfra.org or 402.687.2103 x 1010, for more information on the Center’s Corporate Farming Notes.
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