DRF

FEMA did not use its SFM initiative to ensure that Public Assistance (PA) funds were obligated in accordance with Federal, Department, and component requirements.  Specifically, FEMA obligated PA funds for 83 projects from fiscal years 2017 through 2019 that we reviewed, even though the subrecipients did not need the funding until after 180 days, which made them eligible for incremental obligation under SFM.  This occurred because FEMA did not provide adequate oversight to its Regions.  FEMA relied on the Regions’ decisions to determine whether subrecipients’ projects were eligible for SFM funding, without ensuring there was sufficient supporting documentation to validate the determinations.  This increases the risk of projects being over obligated.  As a result, FEMA is not meeting the intent of SFM, which is to better manage resources in the Disaster Relief Fund to fulfill present and future disaster funding requirements.  We made two recommendations that, when implemented, should improve FEMA’s management and oversight of the Disaster Relief Fund.  FEMA concurred with the recommendations. 

FEMA did not manage disaster relief grants and funds adequately and did not hold grant recipients accountable for properly managing disaster relief funds. We continue to identify persistent problems such as improper contract costs, and ineligible and unsupported expenditures as examples of this continued failure. Over the 7-year period, FYs 2009 to 2015, we found $1.64 billion, or 15 percent, in questioned costs out of the $10.9 billion that we audited, which we recommended FEMA disallow as ineligible and unsupported costs. In FY 2016, we found $155.6 million2, or 23 percent, in questioned costs out of the $686 million that we audited, confirming that FEMA is not making progress managing disaster relief funds adequately. We continue to identify persistent problems throughout FEMA’s grant process, we are concerned that billions of tax payer dollars remain at risk.