Disaster Contracting:

FEMA Needs to Cohesively Manage Its Workforce and Fully Address Post-Katrina Reforms

GAO-15-783: Published: Sep 29, 2015. Publicly Released: Sep 29, 2015.

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What GAO Found

The Federal Emergency Management Agency (FEMA) has more than tripled the number of contracting officers it employs since Hurricane Katrina in 2005, but it does not have a sufficient process in place to prioritize disaster workload and cohesively manage its workforce. Some of the workforce growth is attributed to the establishment of the Disaster Acquisition Response Team (DART) in 2010, which has the primary mission of deploying to provide disaster contracting support, such as contracting for blankets or debris removal. DART has gradually assumed responsibility for administering the majority of disaster contract spending, but FEMA does not have a process for prioritizing the team's work during disasters. Without such a process, FEMA is at risk of developing gaps in contract oversight during major disasters. Further, in 2011, FEMA established an agreement that regional contracting officers would report to headquarters supervisors for technical oversight while continuing to respond to regional supervisors—who have responsibility for administrative duties—for everyday operations. This agreement has led to challenges for FEMA in cohesively managing its workforce, including heightening the potential for an environment of competing interests for the regional contracting officers. Further, FEMA has not revisited this agreement on annual basis as called for in the agreement. As a result, it does not incorporate lessons learned since its creation 4 years ago.

FEMA has not fully implemented 2006 Post-Katrina Emergency Management Reform Act (PKEMRA) contracting reforms due in part to incomplete guidance.

Status of FEMA's Implementation of Selected Post-Katrina Emergency Management Reform Act of 2006 (PKEMRA) Contracting Requirements

Selected PKEMRA requirements

GAO assessment

GAO observations

Noncompetitive contracts

Limit noncompetitive emergency-response contracts justified as unusual and compelling urgency to 150 days unless justified.

Some progress

 

DHS implemented regulations to address this requirement, but 8 of the 13 noncompetitive contracts GAO reviewed exceeded 150 days without justifications. FEMA did not address this limitation in training materials, including a desk guide for contracting officers.

Contracting with local businesses

Provide preference to local vendors for contracts awarded after disasters or a written justification when a non-local contract is awarded.

Some progress

FEMA officials were aware of preferences for local contracts, but the process for determining if vendors are local is not well-defined in FEMA's guidance. Only 1 of the 13 non-local contracts GAO reviewed included the required written justifications.

Transition non-local contracts awarded prior to a disaster to local vendors as soon as possible, unless justified. FEMA guidance requires such transitions within 6 months.

Some progress

 

Two of the 13 non-local contracts GAO reviewed were awarded before the disaster and required to transition to local vendors within 6 months but did not do so.

Source: GAO analysis of Federal Acquisition Regulations, DHS guidance, and FEMA contract data. | GAO-15-783

Why GAO Did This Study

FEMA obligated $2.1 billion in fiscal years 2013 and 2014 for products and services, which included almost $770 million from offices responsible for disaster contracting. Providing disaster relief in a timely manner is essential, while adhering to contracting laws and regulations helps safeguard taxpayer dollars. Following Hurricane Katrina, Congress passed PKEMRA to improve FEMA's disaster contracting.

GAO was asked to review FEMA's disaster contracting practices. This report assesses the extent to which FEMA (1) made efforts to build and manage its contracting workforce and structure since PKEMRA, and (2) adopted PKEMRA reforms and demonstrated good management practices for disaster contracting.

GAO analyzed data on FEMA's workforce from fiscal years 2005 through 2014, reviewed workforce guidance, and reviewed 27 contracts—including 16 selected through a random sample and 11 through a nonprobability sample based on factors including high cost—to determine the extent to which PKEMRA provisions were met. GAO also met with contracting officials.

What GAO Recommends

GAO recommends, among other things, that the FEMA Administrator establish procedures to prioritize DART's workload, revisit the agreement for oversight of regional contracting officers, and improve guidance on PKEMRA requirements. DHS concurred with GAO's recommendations.

For more information, contact Michele Mackin at (202) 512-4841 or mackinm@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: In commenting on this report, DHS concurred with this recommendation. According to FEMA officials, the Office of Procurement Operations has since formed a team that will address this recommendation. We will provide updated information as it becomes available.

    Recommendation: To improve coordination and communication between FEMA OCPO and region mission support officials region mission support officials, the FEMA Administrator should establish a plan to ensure that the agreement is reviewed on an annual basis as intended.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  2. Status: Closed - Implemented

    Comments: In commenting on this report, DHS concurred with this recommendation. In March 2016, FEMA issued an Acquisition Alert memorandum to remind contracting staff that disaster contracts justified as an unusual and compelling urgency may not exceed 150 days without appropriate approval. Additionally, in October 2015, FEMA conducted its annual contracting webinar for staff, which highlighted the 150-day rule.

    Recommendation: To improve implementation of the contracting provisions of PKEMRA, the FEMA Administrator should provide new or updated guidance to ensure all contracting officers are aware of requirements concerning the 150-day limit on noncompetitive contracts justified as urgent and compelling.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  3. Status: Closed - Implemented

    Comments: In commenting on this report, DHS concurred with this recommendation. In October 2015, FEMA conducted its annual disaster contracting webinar for staff. This included presentations and slides on active advanced or pre-positioned contracts and how they should be accessed and used.

    Recommendation: To improve implementation of the contracting provisions of PKEMRA, the FEMA Administrator should provide new or updated guidance to ensure all contracting officers are aware of requirements concerning current information on available advance contracts and how they should be accessed and used.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  4. Status: Closed - Implemented

    Comments: In commenting on this report, DHS concurred with this recommendation. In January 2017, FEMA updated the Disaster Contracting Desk Guide to remind contracting officers to inform state and local government counterparts of the availability and use of advance contracts. This was also incorporated into training for contracting staff, provided the same month.

    Recommendation: To improve implementation of the contracting provisions of PKEMRA, the FEMA Administrator should provide new or updated guidance to ensure all contracting officers are aware of requirements concerning the need to conduct outreach to state and local governments to support their use of advance contracts.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  5. Status: Closed - Implemented

    Comments: In commenting on this report, DHS concurred with this recommendation. In March 2016, FEMA issued an Acquisition Alert memorandum to remind contracting staff of the preference for contracting with local firms, where feasible. It also addressed the requirement to transition pre-positioned contracts to local firms within 6 moths. Additionally, in October 2015, FEMA conducted its annual disaster contracting webinar for staff. This included presentations and slides on contracts set-aside for local firms during disasters, based on the geographic area identified in the disaster declaration.

    Recommendation: To improve implementation of the contracting provisions of PKEMRA, the FEMA Administrator should provide new or updated guidance to ensure all contracting officers are aware of requirements concerning how to contract with local vendors, including an understanding of the regulatory definition of "local," the documentation requirements for the use of non-local vendors, and the process for transitioning non-local awards to local vendors within required timelines or documenting why the transition was not completed.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  6. Status: Closed - Implemented

    Comments: In commenting on this report, DHS concurred with this recommendation. In December 2015, FEMA updated its Standard Operating Procedure for transferring contract files to address how contracting staff, including DART members, will prioritize workloads before they are deployed to a disaster.

    Recommendation: To help ensure that FEMA is prepared to manage the contract administration and oversight requirements of several simultaneous large-scale disasters or a catastrophic event, the FEMA Administrator should update its guidance to establish procedures for prioritizing DART team members' workloads when deployed to a disaster.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  7. Status: Closed - Implemented

    Comments: In commenting on this report, DHS concurred with this recommendation. In November 2016, FEMA submitted the Disaster Contracts Quarterly Report to Congress covering the fourth quarter of fiscal year 2016. The report included an amendment noting that GAO had identified reporting errors in quarterly reports issued prior to fiscal year 2014. The amendment includes an updated list of FEMA disaster contracts issued between fiscal year 2010 and fiscal year 2013.

    Recommendation: To ensure the accuracy of information provided under PKEMRA, the FEMA Administrator should inform Congress of errors in reporting noncompetitive task orders in quarterly reports issued prior to 2014.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  8. Status: Open

    Comments: In commenting on this report, DHS concurred with this recommendation. According to FEMA officials, the Office of Procurement Operations has since formed a team that will address this recommendation. We will provide updated information as it becomes available.

    Recommendation: To improve coordination and communication between FEMA Office of the Chief Procurement Officer (OCPO) and region mission support officials region mission support officials, the FEMA Administrator should direct OCPO and the regional administrators to revisit the 2011 service level agreement to: add details about the extent of operational control headquarters and regional supervisors should exercise to minimize potential competing interests experienced by regional contracting officers; further detail headquarters and regional supervisors' roles and responsibilities for managing regional contracting officers to improve coordination and communication; and ensure that the agreement reflects any new requirements, including recent changes in training that may require travel funds.

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  9. Status: Open

    Comments: In 2016, DHS took steps to ask Congress to repeal PKEMRA Section 692, which prohibits the use of subcontracts for more than 65 percent of the cost of cost-reimbursement type contracts that exceed the simplified acquisition threshold. DHS submitted a legislative change proposal to the Office of Management and Budget (OMB), who approves such proposals before they are submitted to Congress. OMB approved the proposed change for PKEMRA Section 692 in April 2016. We will provide additional updates as information becomes available.

    Recommendation: To address PKEMRA, the Secretary of Homeland Security should take action to address the requirements of Section 692 to implement subcontractor limitations or request that Congress amend the law to delete Section 692.

    Agency Affected: Department of Homeland Security

 

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