GAO assesses Katrina oversight

Confusion, poor communication and a shortage of oversight officials led to wasted spending

Because of confusion over responsibilities and poor communication among officials at the Federal Emergency Management Agency’s headquarters and local FEMA offices in Alabama, FEMA headquarters awarded an unnecessary contract for $10 million to renovate 60 rooms and furnish 80 others in military barracks, according to a new audit report on Hurricane Katrina contracting.

After reviewing contract planning and oversight at three agencies responsible for some of the largest post-Katrina contracts, Government Accountability Office auditors identified three major deficiencies in how agency acquisition officials managed those contracts. GAO focused on three agencies with significant contracting roles in the recovery effort: FEMA, the General Services Administration and the Army Corps of Engineers.

In all three agencies the auditors found inadequate planning, poor preparation and failure to anticipate the goods and services that would be needed to help the Gulf Coast states. Their review documented numerous failures of communication across various agency and jurisdictional lines. The auditors also reported that those agencies had too few employees positioned to provide contractor oversight.

Another problem is that the federal government awards contracts to prime contractors that are actually contract brokers, said Scott Amey, general counsel for the Project on Government Oversight, a nonpartisan watchdog group. “You have unnecessary levels of middlemen involved that just make it more difficult for the federal government to track and monitor,” he said

Because of poor planning and preparation, FEMA, for example, spent $3 million for 4,000 base camp beds that were never used. FEMA officials said they procured the beds based on information from local officials.

The audit found too few oversight officials to monitor contracts. FEMA officials said they are trying to deal with that problem by hiring more contract oversight officials and having them stay in one area to provide continuity rather than providing oversight on a rotating basis with contracting officials moving from place to place.

“The lack of overlap between oversight personnel for a large temporary housing contract left the most recent contract administrator with no knowledge or documentation of who had authorized the contractor to perform certain activities or why the activities were being performed,” according to the GAO report.

Disasters are not entirely predictable; however, this must not be an excuse for poor contracting practices, GAO auditors concluded.

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