Inside EPA's contract freeze

The Trump Administration apparently has frozen new contracts and grants coming from the Environmental Protection Agency, according to several published reports.

Given his campaign rhetoric, it is not surprise that EPA is an early target for scrutiny from the new administration.

Several contractor sources have indicated that it is too early to tell what the impact will be, but there are more than a few dollars at stake.

The Trump administration apparently wants to review all spending coming out of EPA.

According to Deltek, EPA awarded some 750 contracts last year with ceiling values of $1.5 billion. In total during fiscal 2016, contract spending was $1.631 billion, or $4.47 million a day.

On the grant side, EPA awarded $3.9 billion in grants during 2016.

From a regulatory stand point, Trump is targeting EPA rules that limit the use of coal and oil such as air regulations that made it more difficult to build new coal-fired facilities to generate electricity. There are a number of IT systems used to collect and analyze data as well as support of operation.

Trump’s also looking to ease restrictions on transmission lines and apparently is looking to revive Keystone XL and Dakota Access pipelines.

But the freeze on contracts, task orders and the like will also impact ongoing work on climate change, air and water quality, data collection, and research as well as simple IT support. I’m sure there will be an exception clause as there is with the hiring freeze, but it is going to take some time to sort all of this out.

While it is impossible to know much for sure right now, here are some facts I’ve pulled together.

EPA’s Top Contractors for fiscal 2013 through 2016

CSRA Inc.: $320 million in awards

CGI Group: $272.6 million

Environmental Restoration LLC: $206.4 million

Tetra Tech Inc.: $194.6 million

Environmental Quality Management Inc.: $182.9 million

CH2M Hill Inc.: $155.3 million

Weston Solutions: $149.8 million

ICF International: $145.9 million

ECS Federal LLC: $132.3 million

Eastern Research Group: $130.1 million

EPA also has 29 contracts in the source selection phase including a $250 million multiple award IDIQ contract for Information Management Center Services. This is the fourth iteration of this 8(a) small business contract for information management support for EPA libraries, public information centers and records centers. Deltek estimates an award date in February.

Another is for technical support for assessment and watershed protection worth $107 million. There are five incumbents on this contract, according to Deltek. They include Cadmus Group, ABT Associates, Michael Banker Corp., Tetra Tech and RTI International. Awards were expected in May.

Not IT related, but probably the biggest contract in the source election phase is a $1.6 billion multiple award contract for onsite remediation and removal work of hazardous substances, pollutants or contaminants. This is a new contract, according to Deltek. Awards are expected in May.

Another contract is the $9 million contract for data analysis and support to the toxic release inventory. The toxic release inventory is a requirement of a federal law that compels facilities to submit data annually on toxic chemical use and management.

An award was expected in February, according to Deltek. ABT Associates Inc. is the incumbent.

EPA also has several contracts in the pre-RFP stage which means that EPA has issued either a sources sought notice or a draft solicitation but it hasn’t released a final solicitation.

This just gives you a flavor of what a freeze at EPA means to the contractor community.

There are a lot of questions about how long the freeze may last and what can move forward. Do existing contracts automatically get extended if they hit the expiration date with now follow-on awarded? EPA’s press office is silent and its social media channels are inactive as well.

Many are saying that a freeze like this is to be expected when a new administration has such starkly different environmental priorities as its predecessor. The new EPA administrator has been nominated – Scott Pruitt – but has not been confirmed. It stands to reason that the Trump administration wants to make sure that nothing happens that doesn’t line up with its priorities. A blanket freeze is effective is the prevailing wisdom.

Others, however, see this as an unprecedented hit on EPA. After all, as Oklahoma’s attorney general, Pruitt sued EPA for regulatory overreach. EPA regulations also are prime target of Trump's anti-regulation rhetoric on the campaign trail. Transition teams have been stacked with people from the oil and gas industry. The anti-Trump folks argue that they are bent on severely weakening the agency.

That may be, but no matter. Landmark environmental laws are still on the books and still will need to be implemented, so no freeze will last forever. While EPA is under a short-term cloud of uncertainty, contractors are best advised to keep talking to their customers and looking for ways to support them. If a program you support is on the chopping block, how can you help that customer build a defense?

EPA is an early target for the Trump administration, but I don’t think any agency is immune, even the Defense Department. The Trump administration has promised a lot of scrutiny of government spending, so this might not be the last freeze we see.