FEMA Should Recover $21.7 Million of $376 Million in Public Assistance Grant Funds Awarded to the City of Biloxi, Mississippi, for Hurricane Katrina Damages

This is our third audit of the FEMA Public Assistance grant the City received for 2005 Hurricane Katrina damages. For the majority of the $376 million we reviewed, the City of Biloxi, Mississippi (City) accounted for and expended FEMA funds according to Federal requirements. However, the City did not follow all Federal procurement standards for a contract totaling$21.7 million for management of an infrastructure project. As a result, full and open competition did not always occur, which increased the risk of fraud, waste, and abuse, and at least $8.1 million of the $21.7 million in contract costs was unreasonable.