PA Grants

FEMA did not ensure Louisiana adequately managed and provided oversight of PA grants to make certain they complied with Federal regulations.  Specifically, Louisiana had a backlog of 600 incomplete projects beyond their approved completion dates.  We attributed this to the State not conducting regular site visits to assess subrecipients’ ongoing projects, identify and resolve issues as they arose, or ensure prompt project completion.  In addition, FEMA had a backlog of 2,150 completed grant projects it had not closed out due to inadequate oversight of its Region 6 staff to ensure they promptly carried out this responsibility.  As of the fourth quarter of 2018, the combined backlog of 2,750 grant projects represented nearly $6.6 billion in obligated funds.  By May 2020, FEMA had reduced the backlog, but the significant number of remaining projects could lead to delays reimbursing applicants as well as deobligating funds that could be put to better use.  We made three recommendations to FEMA to strengthen its oversight of project completion and closeout processes to ensure they are timely and compliant.  FEMA concurred with one recommendation and did not concur with two.  However, FEMA’s responses resulted in all three recommendations being considered open and unresolved.

We contracted this audit with Cotton & Company LLP, which found that FEMA did not ensure Lee County, Florida (the County) established and implemented policies, procedures, and practices to ensure it accounted for and expended PA program grant funds awarded to disaster areas in accordance with Federal regulations and FEMA guidance.  Specifically, the County requested FEMA funding for $994,425 in unsupported force account labor, equipment, and materials; was unable to provide supporting documentation for $16,210 in costs incurred to operate an emergency shelter; did not maintain adequate documentation to support $267,452 in costs incurred for road repair services; did not include all required provisions in its contracts to obtain disaster recovery services related to Hurricane Irma; and had not evaluated the risk of subrecipients’ noncompliance with Federal requirements, obtained subrecipient audit reports, or developed plans for monitoring subrecipients.  We made nine recommendations that, when implemented, should improve Lee County, Florida’s management of FEMA Public Assistance funds.  FEMA concurred with all nine recommendations.

KPMG found FEMA did not always ensure that the Virgin Islands Emergency Management Agency (VITEMA), and Virgin Islands Water and Power Authority (VIWAPA) established and implemented policies, procedures, and practices to account for and expend PA disaster grant funds in accordance with Federal regulations and FEMA guidance.  Specifically: 1) VITEMA did not have policies and procedures to ensure the timely submission of management costs for reimbursement; 2) VIWAPA did not fully ensure contract costs were reasonable and allowable; and 3) Neither VITEMA nor VIWAPA had fully implemented FEMA’s Grants Manager and Grants Portal system.  This occurred because FEMA did not consistently provide adequate oversight.  Because of these deficiencies, there is increased risk the PA program may be mismanaged and funds may be used for unallowable activities.  We made three recommendations that, when implemented, should improve FEMA’s, VITEMA’s, and VIWAPA’s management of FEMA PA funds.  FEMA concurred with all three recommendations.