EPA Investigator General Cites Clean School Bus Program Inefficiencies, Utility Delays

January 9, 2024

A electric school bus being charged. Interest in electric is expanding across the U.S.

The U.S. Environmental Protection Agency Office of Inspector General released two reports last month that note improvements needed for the Clean School Bus Program, many of which won’t come as a surprise to student transporters.

Management Implication Report: Preventing Fraud, Waste, and Abuse Within the EPA’s Clean School Bus Program released on Dec. 27, identified some of the concerns. One of which is that third parties submitted rebate applications in 2022 on behalf of school districts without their knowledge, ultimately violating program requirements and resulting in the school districts returning the money. The report also states that school districts without student enrollments but that provide transportation for member school districts applied for and received funding.

“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 report reads, stating that when a recipient withdrew, the EPA selected additional applicants from the waiting list, which extended the project timeline.

The report continues, “We also identified a significant lack of transparency in several applications with regard to important contact information regarding contracting parties and vehicle suppliers. In one instance, we had to conduct six months of investigative work, including issuing subpoenas and conducting interviews and surveillance, to ascertain information that should have been in the application, such as the identity of the contractor applicant.”

The Clean School Bus Program changed its requirements last year to allow contractors to apply directly for funds rather than to rely on school district customers to submit the applications.

Additionally, the report refers to a lack of clear and established verification protocols for the applications, as the process allows applicants to self-certify their eligibility. This includes submitting information on miles driven per year, fuel used, and the current state of repair of the buses, all required information when applying for a replacement.

“The EPA has no mechanism for verifying the accuracy or legitimacy of applicant information,” the report states. “It also has no process for following up during the period of performance to ensure that recipients meet their self-certifications and are eligible to participate in the Clean School Bus Program.”

The report adds that the “twin failures of no truthfulness attestation and no verification procedures has already placed IIJA funds at risk.”

The report also provides measures for improvement which include: requiring applications to provide supporting documentation, establishing a validation regimen, requiring recipients to maintain a documentation archive, highlighting criminal penalties and requiring signed certifications, requiring notarized attestations and certifications, and increasing oversight of third-party vendor.

Also on Dec. 27, the OIG released the report The EPA Clean School Bus Program Could Be Impacted by Utility Delays, which found that while no supply chain issues or production delays impacted the EPA’s efforts to disperse funds, the agency may be unable to “effectively manage and achieve the program mission unless local utility companies can meet increasing power supply demands for electric school buses.”

Despite the EPA providing utility resources during the rebate application process, that report found that the agency did not require applicants to contact their utility provider to coordinate potential changes needed to connect charging stations to utilities.

“While early coordination with utilities is not a requirement, it could prevent the agency from achieving its objective to remove older diesel buses and replace them with clean buses,” the report states. “The increased demand on utility companies may impact the timeliness of replacing diesel buses.”

The report notes that infrastructure implemented in front of the meter is not funded through the program, and there “could be delays in utilities constructing the needed charging stations to make the buses fully operational in a timely manner.”

The OIG says the EPA needs to ensure that utilities have constructed and connected charging stations in a timely manner so that school district bus fleets are functional. STN readers have relayed stories about electric school buses sitting in their bus lots awaiting the installation of charging infrastructure.

The World Resources Institute’s Electric School Bus Initiative has been working with school districts and utilities, said Director Sue Gander. The initiative also offers a utility working group that helps student transporters understand from a utility’s perspective what some of the hurdles are.

“And we do subscribe to the mantra to talk to your utility early and often,” Gander told STN.

She added that school district officials can use utility expertise to ask questions and explore what an electric fleet is going to look like in their particular area.

Gander said it’s important to plan the infrastructure and school bus purchase together because certain buses only take certain kinds of chargers, based on the size of the battery and how much charging is needed.

Overall, Gander said the “EPA has been doing a lot of what was recommended in terms of enhancing the program,” adding that in subsequent rounds improvements have been made, such as letting contractors apply directly as well as utility engagement early on and notification of school boards.

“Three of the things that were pointed out as potential hurdles are already [being] worked on,” she added.

In the 2023 CSBP rebate, which is accepting applications through the end of the month, the EPA stated that at least 40 percent of the funds are earmarked for disadvantaged school districts that have yet to apply for the CSB funding because they do not meet the eligibility under the Bipartisan Infrastructure Law’s definition of persistent poverty. This year’s rebate also allows for consulting fees and workforce training and adds $20,000 in funding for wheelchair lifts.

The EPA is also seeking to use this next round and future rounds of funds for the incremental cost of buses, rather than pay for the whole thing.

In February of last year, the EPA announced a new partnership with two national electric utilities groups to increase collaboration with school districts as they electrify their bus fleets. Partnerships with Edison Electric Institute and the Beneficial Electrification League aim to promote a seamless collaboration between districts and utility providers. STN followed up with the EPA for a status report but has not heard back at this writing.

“We’re pleased to have these reports out and have a chance to have some evaluation and look for enhancements and it does seem like EPA has been really responsive but also proactive too in terms of designing things,” Gander shared.

Meanwhile, the OIG office is expected to release two more reports, “Evaluation of EPA’s Selection of Recipients of the Infrastructure Investment and Jobs Act Funding for Clean School Buses,” and “Audit of the EPA’s Clean School Bus Program Rebate Recipient’s Use of Funds.” The release dates of these reports is unknown at this writing.