Fracking for bigger budgets

Springtime has arrived in the nation’s capital, and it is not only the cherry trees that are blossoming.  It is budget time as well, and no federal agency can make do without more dollars, even in terms of ongoing projects and responsibilities; and like flowers opening in the morning sun, the ideas for expanded responsibilities, and budgets, are myriad and inventive. 

One darkly amusing example emerged in February in a memo from a sub-agency in the Office of the Inspector General for the Environmental Protection Agency.  To wit: There was to be a “kickoff meeting” to organize a new effort by the OIG “to evaluate how the EPA and states have used their existing authorities to regulate hydraulic fracturing impacts to water resources.”  And: “We will determine and evaluate what regulatory authority is available to the EPA and states, identify potential threats to water resources from hydraulic fracturing, and evaluate the EPA’s and states’ responses to them.”

Let us put aside the many existing and ongoing studies on fracking and water issues, one major example of which is the recent Department of Energy analysis that can be found here; another is a recent report from the Government Accountability Office.  The EPA OIG is charged with performing “audits, evaluations, and investigations of EPA and its contractors, to promote economy and efficiency, and to prevent and detect fraud, waste, and abuse.” 

So: Precisely what is the OIG role in the analysis of potential fracking effects on water quality and the attendant responses of EPA and the states?  The direct answer is far from obvious; the OIG is supposed to focus its energies on the performance of other EPA agencies and its contractors, again in the context of economy, efficiency, fraud, waste, and abuse.  Are other EPA (and other federal and state) offices not looking at the environmental effects of fracking?  Of course they are.

The indirect answer is far more interesting, as revealed in the March 14, 2014 edition (Vol. 35, No. 11) of Inside E.P.A., in a column titled “EPA IG Touts Independence But Warns Tight Budget May Limit Investigations.”  In the article, the EPA IG, Arthur Elkins Jr., claims to have achieved significant progress in auditing work and the like despite “a very challenging budget environment,” and even takes credit for uncovering “elements” of the work attendance/salary fraud of former EPA official John Beale, who spent months away from the office, apparently on vacation, while claiming to be on assignment for the Central Intelligence Agency.

Precisely which “elements” of the Beale fraud---one of the more amusing displays of federal administrative incompetence in recent memory---were uncovered due to the diligence of the OIG were left undelineated.  The OIG budget proposed by the Obama administration for the next fiscal year is 8.5 percent higher than in FY2014, an increase that seems not too shabby given the economic realities that continue to afflict mere mortals outside the Beltway.  But Elkins claims that the OIG will continue to “struggle with its workload.”  “We definitely need more staff”… particularly in terms of stationing OIG people in regional EPA offices so as better “to prevent and detect fraud, waste and abuse.  You can’t do that when you don’t have somebody in an office.”  And: “Having a limited staff due to tight funding could mean that some cases of fraud might go undetected.”

Of course, the Beale affair suggests that even with heavy staffing right at EPA headquarters, some cases of truly massive fraud might go undetected.  In any event, if staffing issues are hindering the ability of the OIG to conduct its core mission---“audits, evaluations, and investigations of EPA and its contractors, to promote economy and efficiency, and to prevent and detect fraud, waste, and abuse”---then why is the OIG taking on a new function not clearly related to its core functions, largely outside its areas of expertise, and at least arguably in violation of the central principles of federalism?

Only one answer is plausible: The OIG wants to expand its workload so as to increase its claims to budget dollars in the negotiating process with Congress.  That is why the February memo implicitly claims expertise (about regulatory authority and water quality issues) that is far more likely to exist in other offices, and expertise in policy analysis (the evaluation of EPA and state responses) that there is little reason to believe the OIG has.  If the OIG has the resources to begin this effort, then maybe its budget is not as constrained as Elkins would have us believe.  Perhaps an 8.5 percent budget cut would be more appropriate.

Zycher is the John G. Searle scholar at the American Enterprise Institute, a conservative think tank.  Email:

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