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The Environmental Protection Agency (EPA) has a primary mission to protect human health by safeguardmg the natural environment-air, water, and land. EPA carries out a large part of its mission by awarding grants and contracts to states, public and private entities, and other federal agencies. More than 70 percent of EPA's budget is used to award grants' and contracts. Once a grant or contract is completed or terminated and once the applicable budget or project period has expired, the agency must determine if the required work was completed and then close out the project, which includes making any final payments due the recipient. One of the primary purposes of closing out grants and contracts is to ensure that any unliquidated obligated funds are recovered and used for environmental programs, as permitted by statute. The unliquidated funds from completed grants and contracts represent millions of dollars that potentially could be recovered, deobligated, and used to provide EPA with additional resources needed to fund other environmental programs. The timely closeout of grants and contracts is also an important financial management practice to ensure that the terms of the contracts and grants are accomplished., Report to the Chairman, Subcommittee on VA, HUD, and Independent Agencies, Committee on Appropriations, House of Representatives.