FEMA also pays for temporary housing and crisis counseling for eligible victims. Prior to the Northridge earthquake, FEMA used the Fast Track process for only one disaster—Hurricane Andrew in 1992. In the case of Northridge, FEMA concluded that the Fast Track process was essential to meet the needs of disaster victims expeditiously. The enormous number of disaster victims and their psychological and physical need for immediate assistance provided the rationale for implementing the Fast Track process. Northridge Experience Suggests Need for Fast Track Guidance

In implementing the Fast Track process following the Northridge earthquake, FEMA experienced operational difficulties, including the inconsistent application of criteria when designating areas with the greatest estimated damage and constraints in its application processing software. These difficulties, combined with the logistical challenge of processing an enormous volume of applications for assistance, as well as FEMA’s decisions on the eligibility of housing assistance under both the regular and Fast Track processes, may have contributed to FEMA’s providing housing assistance in excess of actual needs. FEMA has not developed written guidance for implementing the Fast Track process, even though FEMA’s Inspector General recommended establishing formal procedures after its first use in 1992. Because of these errors, not all Northridge victims in similar circumstances were treated the same. (These nine ZIP codes account for about 4 percent of the payments that FEMA designated for recovery.) Fast Track Represents Trade-Off Between Expedited Assistance and Control of Federal Funds

A principal advantage of the Fast Track process is that it hastens the distribution of temporary housing assistance grants to some applicants, facilitating a move into alternate housing more quickly than would the regular process. Also, according to FEMA officials involved in the response to the Northridge earthquake, Fast Track provided an intangible benefit by demonstrating to the victims and the general public that help was actually on the way. A principal disadvantage is the relative loss of control over the disbursement of federal funds and the subsequent need to recover ineligible payments. FEMA ultimately designated for recovery 6.7 percent ($9.6 million of $143 million) of the temporary housing assistance provided under the Fast Track process for 3,856 Northridge earthquake applicants. FEMA Relies on States to Ensure That Crisis-Counseling Funds Are Used Appropriately

FEMA provides crisis-counseling funding for screening and diagnosing individuals, short-term crisis counseling, community outreach, consultation, and education services. For the distribution of funds provided after the Northridge earthquake, FEMA officials said that they visited all service providers, and CMHS officials evaluated the providers’ accounting procedures and controls and found them to be satisfactory. To examine FEMA’s experience with the Fast Track process in Northridge, including whether FEMA adopted its Inspector General’s previous recommendations on the Fast Track process and how FEMA determined the geographic areas included in Fast Track, we interviewed FEMA officials from FEMA’s headquarters; FEMA’s OIG office; the Disaster Finance Center and the National Processing Services Center at Mt. 2. 3. 4. 5.
Why GAO Did This Study

Pursuant to a congressional request, GAO examined several issues pertaining to the Federal Emergency Management Agency's (FEMA) use of the Fast Track process and FEMA's crisis-counseling assistance to victims of the Northridge earthquake, focusing on: (1) the authority and rationale for the Fast Track process; (2) FEMA's experience with the Fast Track process in Northridge and whether the process was influenced by the Office of Inspector General's recommendations; (3) the advantages and disadvantages of the Fast Track process, including the amounts of payments that FEMA designated for recovery and subsequently recovered and the reasons for ineligibility; and (4) FEMA's criteria and process for providing crisis-counseling funds and ensuring their use for authorized purposes.

What GAO Found

GAO noted that: (1) the legislation authorizing FEMA's temporary housing assistance has no explicit provision for a process such as Fast Track; (2) however, as FEMA concluded, the act gives the agency wide latitude in providing expeditious assistance for disaster victims; (3) FEMA's rationale in implementing the Fast Track process following the Northridge earthquake was to assist the largest number of disaster victims in the shortest possible amount of time; (4) in implementing the process, FEMA experienced operational difficulties including the inconsistent application of criteria when designating zip codes; (5) because of these errors, not all Northridge victims in similar circumstances were treated the same; (6) FEMA also experienced constraints with the computer software used to process applications; (7) these difficulties, combined with an enormous volume of applications for assistance and FEMA's decisions on applicants' eligibility for payments made under both the regular and Fast Track processes, may have contributed to FEMA's provision of housing assistance beyond actual needs; (8) FEMA has not developed written guidance for implementing the Fast Track process, even though FEMA's Inspector General recommended establishing formal procedures after the Fast Track process's first (and only other) use in 1992; (9) a principal advantage of the Fast Track process is that it provides temporary housing assistance grants for some applicants more quickly than would the regular process; (10) according to FEMA officials involved in the response to the Northridge earthquake, Fast Track provided an intangible benefit by demonstrating to the victims and the general public that help was actually on the way; (11) a principal disadvantage to Fast Track is the relative loss of control over the disbursement of federal funds and the subsequent need to recover ineligible payments; (12) FEMA ultimately designated for recovery 6.7 percent ($9.6 million of $143 million) of the temporary housing assistance provided under the Fast Track process for 3,856 Northridge earthquake applicants; (13) FEMA provides crisis-counseling funding for screening and diagnosing individuals, short-term crisis counseling, community outreach, consultation, and educational services; and (14) for funds provided after the Northridge earthquake, FEMA officials said that they visited all service providers and that center officials evaluated their accounting procedures and controls and found them to be satisfactory.