Disaster Recovery

We contracted this audit with Cotton & Company LLP, which found that FEMA did not ensure the Florida Department of Emergency Management (FDEM) monitored the Polk County School Board (PCSB) to ensure it established and implemented policies, procedures, and practices to account for and expend PA grant funding in accordance with Federal regulations and FEMA guidance.  For example, PCSB was unable to support $46,168 in food spoilage costs; requested and received funding through a Florida Public Assistance grant for ineligible contract costs incurred under Project 2658 for debris removal and related costs; and charged $897 in unallowable costs associated with ineligible fringe benefits for substitute employees.  We made 13 recommendations that, when implemented, should improve PCSB’s management of FEMA Public Assistance funds.  FEMA concurred with our 13 recommendations.

The Federal Emergency Management Agency (FEMA) Missouri, and Joplin Schools did not properly manage and oversee this disaster award.  Specifically, FEMA and Missouri did not provide proper grant management and oversight of Joplin’s subgrant activities.  Joplin Schools disregarded Missouri’s authority as the grantee and did not always comply with Federal requirements and FEMA policies as required.  This occurred because Joplin Schools heavily relied on the advice of its grant management contractor.  As a result of the grant management and oversight issues, Joplin Schools did not follow Federal procurement standards when it awarded $187.3 million in non-exigent disaster-related contracts, including $609,676 in ineligible contractor direct administrative costs.  We provided five recommendations to help improve FEMA and Missouri’s grant oversight and management process.  We also included four recommendations for FEMA to disallow or not fund $187.3 million in ineligible contract costs.  FEMA determined approximately $56 million, the net obligated amount, was eligible for reimbursement.  FEMA concurred with all nine recommendations and completed actions to close recommendations 1 to 4 and 8.  Recommendations 5 to 7 are resolved and open with a target completion date of June 1, 2020. Recommendation 9 is considered unresolved and open

FEMA is not effectively designating Surge Capacity Force (SCF) volunteers and managing the SCF program during disaster operations.  In 2017, FEMA was not prepared to deploy SCF Tier 4 volunteers rapidly and efficiently because FEMA had neither a clear commitment from agencies outside DHS to participate in SCF, nor a roster of volunteers capable of rapidly deploying.  FEMA did not adequately measure SCF performance because it did not have mechanisms to collect data and feedback to gauge program success.  FEMA did not effectively manage the SCF financial program because it relied heavily on the financial controls of volunteers’ home agencies without guarding against breakdowns in those controls.  Finally, FEMA did not close mission assignments promptly because it did not make closing them a priority in what officials described as a series of “overwhelming” catastrophes.  We made four recommendations for FEMA to improve designation of SCF volunteers and management of the SCF program.  FEMA concurred with three of our four recommendations.

KPMG, LLP found that the Federal Emergency Management Agency (FEMA) did not always ensure Virgin Islands Territorial Emergency Management Agency (VITEMA) and the Virgin Islands Department of Education (VIDE) established and implemented policies, procedures, and practices to account for and expend Public Assistance (PA) grant funds according to Federal regulations and FEMA guidance.  For example, VIDE did not have policies and procedures to address procurement-related conflicts of interest and related disciplinary actions.  This occurred because FEMA did not adequately train VIDE personnel and did not review these policies and procedures.  We made five recommendations that, when implemented, should improve management of FEMA PA grant funds, ensuring the funds are expended according to Federal regulations and FEMA guidance.  FEMA concurred with the recommendations. 

KPMG, LLC found the Federal Emergency Management Agency (FEMA) did not provide adequate guidance to the Virgin Islands Emergency Management Agency (VITEMA) and the Virgin Islands Housing Finance Agency (VIHFA) and that VITEMA and VIHFA did not adequately manage FEMA Public Assistance (PA) funds.  Also, VITEMA and VIHFA did not always ensure the accuracy of project funding information or promptly notify FEMA about significant project cost overruns.  This occurred because FEMA did not provide the necessary guidance to and oversight of VITEMA and VIHFA to properly manage PA funds.  Because of these deficiencies, PA programs are at increased risk of mismanagement and expenditure of funds for unallowable activities.  We made seven recommendations to improve VITEMA’s and VIHFA’s management of FEMA PA funds, ensuring they are expended according to Federal regulations and FEMA guidance.  FEMA concurred with the recommendations.

Harris County, Texas needs additional technical assistance and monitoring to ensure grants management comply with Federal procurement regulations.  The County’s procurement policies, procedures, and business practices were not adequate to expend disaster grant funds in accordance with Federal procurement regulations and Federal Emergency Management Agency (FEMA) guidelines.  We recommended FEMA disallow $2.7 million in ineligible costs and require Texas to work with the County to incorporate Federal procurement regulations when using Federal funds, and review procurement activities before the County awards future contracts.  We made three recommendations that will help improve the procurement capability of Harris County, Texas.  FEMA concurred with all three recommendations. 

Williams-Adley determined that the Federal Emergency Management Agency (FEMA) did not always ensure that Department of Transportation and Public Works (DTOP) established and implemented policies, procedures, and practices to account for and expend PA grant funds according to Federal regulations and FEMA guidance.  Specifically, DTOP did not have (1) an effective grants management process; (2) sufficient internal controls in the procurement process; and (3) sufficient controls over its processes for claiming Force Account Labor costs.  This occurred because FEMA and Central Office of Recovery, Reconstruction and Resiliency (COR3) did not adequately oversee DTOP’s grant management activities.  We made three recommendations to improve COR3’s and DTOP’s management of FEMA Public Assistance funds, ensuring they are expended according to Federal regulations and FEMA guidance.  FEMA concurred with the recommendations.

Williams-Adley determined that the Federal Emergency Management Agency (FEMA) did not ensure the Puerto Rico Central Office of Recovery, Reconstruction, and Resiliency (COR3) and the Puerto Rico Aqueduct and Sewer Authority (PRASA) establish and implement policies, procedures, and practices to account for and expend Public Assistance (PA) grant funds according to Federal regulations and FEMA guidance.  Specifically, PRASA did not follow established policies and procedures for: (1) recording the capacity size and rate of its force account equipment; and (2) ensuring each vendor had a certificate of eligibility before receiving a contract award.  We made two recommendations to improve PRASA’s management of FEMA PA funds, ensuring they are expended according to Federal regulations and FEMA guidance.