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OIG-15-06-D
October 30, 2014
HIGHLIGHTS
FEMANeedstoTrackPerformanceDataand
DevelopPolicies,Procedures,andPerformance
MeasuresforLongTermRecoveryOffices
October30,2014
WhyWeDid
This
Between1994and2013,FEMA
operatedsevenLongTerm
RecoveryOffices.FEMA
obligatedandspentmorethan
$4billioninadministrativecosts
andmorethan$1billionin
salariesfortheseoffices.
Ourauditobjectivewasto
determinewhetherFEMAs
policies,procedures,and
performancemeasuresfor
establishing,operating,and
closingLongTermRecovery
OfficesmeetFederalstatutes
andareconsistentlyapplied.
WhatWe
Recommend
Wemadetwo
recommendationstoFEMA
that,whenimplemented,will
allowFEMAtomanageLong
TermRecoveryOfficesmore
consistentlyandeffectively.
ForFurtherInformation:
WhatWeFound
FEMAdoesnottrackcostsordataassociatedwith
performancemeasuresforLongTermRecoveryOffices.
Withouttrackingcostsordata,FEMAcannotdetermine
whethertheseofficesarecosteffective.FEMAestablishes,
operates,andclosesLongTermRecoveryOfficeswithout
standardizedpolicies,procedures,andperformance
measures.Withoutthesecontrolsinplace,FEMAisatriskfor
mismanagementofFederaldisasterfundsandcannotensure
consistencyinestablishingandmanagingtheseoffices.
CorrectingthesedeficiencieswillprovideFEMAthe
informationandguidanceitneedstodeterminewhether
LongTermRecoveryOfficesarecosteffective.Inaddition,
FEMAcanbetterensureconsistencyinestablishingand
managingtheseoffices.
FEMAResponse
FEMAconcurswithourrecommendations.FEMAplansto
determinethecosteffectivenessofvariousmodelsfor
managingLongTermRecoveryOffices.Thesemodelswill
examinepostdisastercoordinationanddeliveryofdisaster
assistancetoassistFEMAindevelopingdecisionmaking
guidanceforidentifying,tracking,andreportingontheneed
forandcosteffectivenessoftheseoffices.FEMAiscurrently
documentingtheprocess,procedures,performance
measures,lessonslearned,andbestpracticesusedtoscope
andestablishtheSandyRecoveryOffice.FEMA'swritten
responsetousforthisreportisduein90days.
ContactourOfficeofPublicAffairsat
(202)2544100,oremailusat
DHSOIG.OfficePublicAffairs@oig.dhs.gov
www.oig.dhs.gov
OIG-15-06-D
OCT 3 0 2014
MEMORANDUM FOR:
Elizabeth Zimmerman
...ministrator,
'"'"'-''>-
--
FROM:
Assis
or General
Attached for your information is our final letter report, FEMA Needs To Track
Performance Data and Develop Policies, Procedures, and Performance Measures for
Long Term Recovery Offices. We incorporated the formal comments from the Federal
www.oig.dhs.gov
OIG-15-06-D
Please call me with any questions, or your staff may contact Tonda L. Hadley, Deputy
Assistant Inspector General for Audit Services, Office of Emergency Management
Oversight, at (214)436-5200.
Attachment
www.oig.dhs.gov
OIG-15-06-D
Background
WhenthePresidentdeclaresaFederaldisaster,theFederalEmergencyManagement
Agency(FEMA)RegionalOfficethatservicestheaffectedStateisresponsiblefor
responseandrecoveryefforts.TheRegionalOfficeopensaJointFieldOfficeto
coordinateeffortswithitsdisasterpartners.WhenaJointFieldOfficecloses,the
disasterprogramsusuallytransferbacktotheRegionalOffice.IncaseswhereStateand
localcommunityofficials,businesses,andcitizensneedadditionalrecoveryassistance,
FEMAmayopenaLongTermRecoveryOffice.Theseofficesopenbecausethesize,
severity,orthenumberofdisastersoverwhelmstheRegionalOffice.Figure1showsthe
progressionofthedisasterresponseandrecoveryresponsibilitythroughFEMA.
Figure1:DisasterFlowchart
Disaster
Declaration
RegionBegins
Response
Region
Continues
Response
No
JointField
OfficeOpens
JointField
OfficeCloses
Yes
CanRegion
Resume
Responsibilityof
Disaster
No
LongTerm
Recovery
OfficeOpens
LongTerm
Recovery
OfficeCloses
Region
Resumes
Responsibility
forDisaster
Yes
ThestructureofLongTermRecoveryOffices,inpart,mirrorsdivisionswithinthe
RegionalandJointFieldOfficestoensureasmoothtransitionbackintoregional
operations.Forexample,eachofficehasLogistics,Finance,andOperationsDivisions.
ResultsofAudit
Weestimatethat,between1994and2013,FEMAobligatedandspentmorethan
$4billioninadministrativecostsandmorethan$1billioninsalariesforthesevenLong
TermRecoveryOffices.Theseofficeswereresponsiblefor26majordisaster
declarationstotaling$66billioninobligatedfunds.However,FEMAdoesnottrackcosts
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OIG1506D
orperformancedatafortheseoffices.Asaresult,FEMAcannotdeterminethecost
effectivenessofLongTermRecoveryOfficeoperations.Inaddition,FEMAhasnot
createdstandardizedpolicies,procedures,andperformancemeasuresforLongTerm
RecoveryOfficeoperations.Withoutthem,FEMAcannotensureconsistencyin
establishingandmanagingtheseoffices.
InJanuary2014,FEMAopenedanadditionalLongTermRecoveryOfficeforHurricane
Sandy,responsiblefortherecoveryeffortsinNewYorkandNewJersey.Federal
spendingforHurricaneSandywilllikelysurpassallbutonepreviousdisaster(Hurricane
Katrina).Therefore,itisimperativethatFEMAshould(1)identify,track,andreport
performancedatathatshowscosteffectivenessforLongTermRecoveryOffices;and
(2)implementstandardizedpolicies,procedures,andperformancemeasuresto
establish,operate,andcloseLongTermRecoveryOffices.
FEMADoesNotTrackLongTermRecoveryOfficeCostsorPerformanceData
FEMAdoesnottrackcostsordataassociatedwithperformancemeasuresforLongTerm
RecoveryOffices.Withouttrackingcostsordata,FEMAcannotdeterminewhetherLong
TermRecoveryOfficesarecosteffective.
Costs
FEMAcouldnotverifythecostsofeachLongTermRecoveryOffice.TheFederal
Managers'FinancialIntegrityActof1982(Act),inpart,requiresthatFederalagencies
properlyrecordandaccountforrevenuesandexpendituresapplicabletoagency
operationstomaintainaccountabilityfortheirassets.FEMAassertsthatitisnotin
violationofthisActbecauseFEMAsfinancialsystemtracksoveralldisastercosts.
However,FEMAcouldnotprovidethecostsbylocation.Tofullyaccomplishthegoalof
theAct,FEMAshouldbetrackingthecostsforeachLongTermRecoveryOffice.
FEMAprovidedtheoveralldisastercostsrelatedtosevenLongTermRecoveryOffices.
WeworkedwithFEMAtoanalyzethesecostsandmutuallyagreedtoestimatethat
FEMAobligatedandspentmorethan$4billioninadministrativecostsandmorethan$1
billioninsalariesforthesevenoffices.Withouttrackingcosts,FEMAisunableto
determinewhetherLongTermRecoveryOfficeoperationsarecosteffective.Further,
FEMAneedstotrackimportantdatasuchasofficespending,disasterprogram
workload,andnumberofLongTermRecoverypersonneltodetermineeconomiesof
scale.
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DataAssociatedwithPerformanceMeasures
Inaddition,FEMAisnottrackingdataassociatedwithperformancemeasures.
Performancemeasurementistheongoingmonitoringandreportingofprogram
accomplishments,particularlyprogresstowardpreestablishedgoals.Performance
measuresmayaddress(1)thetypeorlevelofprogramactivitiesconducted(process),
(2)thedirectproductsandservicesaprogramdelivers(outputs),or(3)theresultsof
thoseproductsandservices(outcomes).Withouttrackingsuchdata,FEMAcannot
determinewhethertheeconomiesofscalearecosteffective.
Forexample,FEMAmirrorsitsLongTermRecoveryOffices,inpart,aftertheoperations
intheRegionalandJointFieldOffices.AllthreeofficetypeshaveLogistics,Financial,and
OperationsDivisions.Theseparalleldivisionsexisttoallowforasmoothtransitionof
disasteroperationsbacktotheRegionalOfficewhenRegionalofficialsdecidetheyno
longerneedaLongTermRecoveryOffice.
FEMANeedsStandardizedPolicies,Procedures,andPerformanceMeasuresforLong
TermRecoveryOffices
FEMAestablishes,operates,andclosesLongTermRecoveryOfficeswithout
standardizedpolicies,procedures,andperformancemeasures.TwoFederalstatutes,
theRobertT.StaffordDisasterReliefandEmergencyAssistanceActandPostKatrina
EmergencyManagementReformActof2006,authorizeFEMAtoestablishfieldoffices,
includingLongTermRecoveryOffices.However,thesestatutesdonotprovide
proceduralguidanceorperformancemeasuresfortheseoffices.
TheGovernmentPerformanceandResultsActof1993institutedagovernmentwide
requirementthatagenciessetgoalsandreportannuallyonperformance.Accordingto
theGovernmentAccountabilityOffice(GAO),mostFederalagenciesnowuse
performancemeasurestotrackprogresstowardsgoals.1
Withoutstandardizedpolicies,procedures,andperformancemeasures,FEMAofficials,
attheirdiscretion,determinetheoveralloperationofLongTermRecoveryOffices.
FEMAregionalofficialssaidthatthefactorstheyconsiderindecidingtoopenorclosea
LongTermRecoveryOfficeinclude:thevolumeofIndividualAssistanceapplications
opened,PublicAssistanceprojectapplications,PublicAssistanceprojectrevisionsand
HazardMitigationprojectssubmitted;andtheamountofinsuranceclaimsanddollars
paid.WeaskedFEMAtoprovideuswithcopiesofthereportsitusedtodecidewhether
1
PerformanceMeasurementandEvaluation:DefinitionsandRelationships,GAO11
646SP,May2,2011.
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OIG1506D
toopenorcloseaLongTermRecoveryOffice.Theywereabletoprovideuswithreports
showingdataFEMAassessedfortheclosure,butnottheestablishmentofLongTerm
RecoveryOffices.Inaddition,thesereportswerenotstandardizedandnoteveryregion
usedthem.FEMAofficialssaidthatthekeydecisionpointforestablishingandclosinga
LongTermRecoveryOfficerestsontheregionalofficialsdisasterknowledgefor
determiningtheneed,operation,andclosureoftheseoffices.FEMAalsosaidtheability
anddesireoftheaffectedStatetocloseoutdisasterrecoveryworkquicklyaffectsthe
operationsandclosureoftheLongTermRecoveryOffices.
AsaresultofusingthissubjectivedecisionmakingprocessandtheaffectedStates
abilityanddesiretocloseoutthedisaster,LongTermRecoveryOfficesremainopenfor
inconsistenttimeframes.Table1showsthat,asofOctober2013,FEMAhadopened
sevenLongTermRecoveryOfficesandhadclosedfour.
Table1:FEMALongTermRecoveryOffices,19942013
FEMA
Region
State
Opened
Closed/Status
RegionIV
RegionIV
RegionIV
RegionVI
RegionVI
RegionVII
Mississippi
Florida
Alabama
Texas
Louisiana
Iowa
4/2006
5/2005
6/2006
4/2006
5/2006
8/2009
RegionIX
California
1/1994
Open
1/2012
11/2009
2/2009
Open
10/2012
Transitionedto
anAreaField
Office2008
TOTALS
LTRO1
Agein
Months
90
79
40
33
89
37
Major
Disasters
Managed
1
7
1
2
4
1
167
TotalObligated
DisasterFunds*
Average#of
Staff
10,070,369,164
9,252,934,569
1,027,409,341
1,930,083,021
33,458,602,832
1,909,841,777
970
200
110
122
790
104
10
8,095,285,213
315
26
$65,744,525,917
Source:FEMAHeadquartersandFEMARegionIV,VI,VII,andIX;FEMADisasterFinancialStatusReports
fromAugust2013;andFEMAFinancialInformationToolReportsfromNovember2013
1
LongTermRecoveryOffice
*TotalObligatedDisasterFundsarecalculatedfromthetimeofthedisasterdeclarationuntildisaster
closureorOctober31,2013,whichevercamefirst.
InJanuary2014,FEMAopenedanadditionalLongTermRecoveryOfficeforHurricane
Sandy,responsiblefortherecoveryeffortsinNewYorkandNewJersey.Hurricane
Sandyislikelytobeoneofthemostcostlydisastersinhistory.AsofJanuary2014,
FEMAhadalreadyobligatednearly$7billionindisasterfundsforHurricaneSandyin
NewYorkandNewJerseyandemployedover700staffforLongTermRecoveryOffices
inthosetwoStates.
FEMAofficialsrecognizethelackofstandardizedpolicies,procedures,andperformance
measuresforLongTermRecoveryOffices.Withoutthesecontrolsinplace,FEMAisat
riskformismanagementofFederaldisasterfundsandcannotensureconsistencyin
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OIG1506D
establishingandmanagingtheseoffices.However,severalFEMAregionalofficialssaid
theyhavedevelopedindividualpracticesfortheLongTermRecoveryOfficesusingtheir
knowledgeofdisasteroperationsandregionalofficecapabilities.Additionally,since
September2013,severalFEMAregionalofficesbegansharingtheirpracticeswithFEMA
RegionII,whichisresponsibleforHurricaneSandyrecoveryinNewJerseyandNew
York.Finally,before2008,FEMAheadquartersdevelopedadraftdirectiveoutlining
LongTermRecoveryOfficeoperations.However,FEMAheadquartersleadershiphas
notimplementedthatdirective.
Conclusion
FEMArisksmismanagingdisasterrelieffundsbecauseitdoesnottrackcostsor
performancedataandhasnotcreatedandimplementedstandardizedpolicies,
procedures,andperformancemeasuresforLongTermRecoveryOffices.Correcting
thesedeficiencieswillprovideFEMAtheinformationandguidanceitneedsto
determinewhetherLongTermRecoveryOfficesarecosteffective.Inaddition,FEMA
canbetterensureconsistencyinestablishingandmanagingtheseoffices.
Recommendations
WerecommendthattheAssociateAdministratorforResponseandRecovery,Federal
EmergencyManagementAgency:
Recommendation#1:Identify,track,andreportcostsandperformancedatathatshow
costeffectivenessforLongTermRecoveryOffices.
Recommendation#2:Implementstandardizedpolicies,procedures,andperformance
measurestoestablish,operate,andcloseLongTermRecoveryOffices.
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OIG1506D
ManagementCommentsandOIGAnalysis
WereceivedandreviewedwrittencommentsonthedraftreportfromFEMAsAssociate
AdministratorforPolicy,ProgramAnalysisandInternationalAffairs.FEMAconcurswith
ourrecommendations.
BasedontheinformationFEMAprovided,weconsiderrecommendation#1asresolved
andopen.FEMAiscurrentlydeterminingthecosteffectivenessofvariousmodelsfor
postdisastercoordinationanddeliveryofassistance.Thisinitiativewillestablishcriteria
fordeterminingthecosteffectivenessandapplicabilityofonemodelversusanother
basedonhistoriccostdataandprojectionsofpotentialcostsavings.FEMAwillthen
developdecisionmakingguidanceforidentifying,tracking,andreportingontheneed
forandcosteffectivenessofLongTermRecoveryOfficesversustransitioningsupportto
theFEMARegionorotheroptions.FEMAsestimatedcompletiondateisMarch31,
2015.
BasedontheinformationFEMAprovided,wealsoconsiderrecommendation#2as
resolvedandopen.FEMAiscurrentlydocumentingtheprocess,procedures,
performancemeasures,lessonslearned,andbestpracticesusedtoscopeandestablish
theSandyRecoveryOffice.TheSandyRecoveryOfficeapproachandOIGfindingswill
assisttheFEMAinitiativetoupdateandimplementpreviouslydevelopeddraft
guidance,procedures,andperformancemeasurestoestablish,operate,andcloseLong
TermRecoveryOffices.FEMAsestimatedcompletiondateisMarch31,2015.
AppendixBincludesacopyofthemanagementcommentsintheirentirety.
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OIG1506D
AppendixA
Objectives,Scope,andMethodology
TheDepartmentofHomelandSecurity(DHS)OfficeofInspectorGeneral(OIG)was
establishedbytheHomelandSecurityActof2002(PublicLaw107296)byamendment
totheInspectorGeneralActof1978.Thisisoneofaseriesofaudit,inspection,and
specialreportspreparedaspartofouroversightresponsibilitiestopromoteeconomy,
efficiency,andeffectivenesswithintheDepartment.
TheobjectiveofthisauditwastodeterminewhetherFEMAspolicies,procedures,and
performancemeasuresforestablishing,operating,andclosingLongTermRecovery
OfficesmeetFederalstatutesandareconsistentlyapplied.
WeinterviewedFEMAHeadquartersofficialsandFEMARegionalofficialsinFEMA
RegionsIV,VI,VII,andIX;reviewedFederalstatutesandregulationsanddraftFEMA
policiesandprocedures;analyzeddisastercostdataforthedisastersmanagedbythe
sevenLongTermRecoveryOfficesfortheperiodJanuary1994throughOctober2013.
Usingthedisastercostdata,weestimatedtheLongTermRecoveryOfficesoperating
costs.Forthis,weusedtheoveralldisasteroperationsobligationsandexpendituresand
eliminatedcostsnotdirectlyattributedtotheoperationoftheLongTermRecovery
Offices.Wethenadjustedthosecostsandobligationstoreflecttheestimatedcost
attributedtotheLongTermRecoveryOfficesandotherdisasterofficesthroughOctober
2013.WealsocompiledstaffinganddisasterfunddataforNewJerseyandNewYorkfor
HurricaneSandytodetermineitscurrentfinancialimpactonLongTermRecovery
Offices;andperformedotherproceduresconsiderednecessarytoaccomplishour
objective.
WedidnotassesstheadequacyoftheagencysinternalcontrolsapplicabletoLong
TermRecoveryOfficeoperationsbecauseitwasnotnecessarytoaccomplishouraudit
objectives.
WeconductedthisperformanceauditbetweenJune2013andMarch2014pursuantto
theInspectorGeneralActof1978,asamended,andaccordingtogenerallyaccepted
governmentauditingstandards.Thosestandardsrequirethatweplanandperformthe
audittoobtainsufficient,appropriateevidencetoprovideareasonablebasisforour
findingsandconclusionsbaseduponourauditobjectives.Webelievethattheevidence
obtainedprovidesareasonablebasisforourfindingsandconclusionsbaseduponour
auditobjectives.
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OIG1506D
AppendixB
ManagementCommentstotheDraftLetterReport
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OIG1506D
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OIG1506D
AppendixC
ReportDistribution
DepartmentofHomelandSecurity
Secretary
DeputySecretary
ChiefofStaff
DeputyChiefofStaff
GeneralCounsel
ExecutiveSecretary
Director,GAO/OIGLiaisonOffice
AssistantSecretaryforOfficeofPolicy
AssistantSecretaryforOfficeofPublicAffairs
AssistantSecretaryforOfficeofLegislativeAffairs
DHSComponentLiaison
ChiefPrivacyOfficer
FederalEmergencyManagementAgency
Administrator
ChiefofStaff
AssociateAdministrator,ResponseandRecovery
Director,OfficeofRegionalOperations
ChiefFinancialOfficer
AssociateAdministratorforPolicyandProgramAnalysis
Director,ProgramAnalysisandEvaluationDivision
Director,RiskManagementandCompliance
OIGPortfolioManager,OfficeofPolicyandProgramAnalysis
OfficeofManagementandBudget
Chief,HomelandSecurityBranch
DHSOIGBudgetExaminer
RecoveryAccountabilityandTransparencyBoard
Director,Investigations,RecoveryAccountabilityandTransparencyBoard
www.oig.dhs.gov
12
OIG1506D
Congress
CongressionalOversightandAppropriationsCommittees
www.oig.dhs.gov
13
OIG1506D
OIG HOTLINE
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"Hotline" tab. If you cannot access our website, call our hotline at (800) 323-8603, fax our
hotline at (202) 254-4297, or write to us at:
Department of Homeland Security
Office of Inspector General, Mail Stop 0305
Attention: Hotline
245 Murray Drive, SW
Washington, DC 20528-0305