	Background

On August 29, 2005, Hurricane Katrina devastated the Gulf Coast region,  causing human casualties and billions of dollars in damage. The Government Does Not Have a Framework in Place to Collect and Consolidate Information to Report on Hurricane-Related Funding

The federal government is not adequately tracking and reporting on the  use of the $88 billion in hurricane relief and recovery funds provided thus  far to 23 federal agencies in the four emergency supplemental  appropriations acts. As a result,  FEMA’s required weekly reports to the Congress have limited usefulness  from a governmentwide perspective. Therefore, it will be difficult for decision makers to  determine how much federal funding has been spent and by whom,  whether more may be needed, or whether too much was provided. FEMA’s Required Reports Do Not Provide Adequate Information from a Governmentwide Perspective

FEMA is required to report weekly to the Appropriations Committees on  the use of funds it received; however, these reports do not provide timely  information from a governmentwide perspective because FEMA does not  have a mechanism in place to collect and report on information from other  agencies which perform work on its behalf. Specifically, when FEMA tasks  another agency through a mission assignment, which is similar to an  interagency agreement for goods and services, FEMA records the entire  amount upfront as an obligation on its reports to the Congress. The agency  performing the task for FEMA does not record an obligation until a later  date when it has actually obligated funds to carry out its mission, thereby  overstating reported governmentwide obligations. The opposite is true for  expenditures. The agency expends the funds, but then has to bill FEMA for  reimbursement. FEMA does not record the expenditure on its reports to the  Congress until it has received the bill from the performing agency,  reviewed it, and recorded the expenditure in its accounting system,  thereby understating reported governmentwide expenditures. We found  that no one agency or central collection point exists to compile and report  on how these funds are being spent. The ability to separately track and  report on these funds is important to help ensure better accountability and  clearly identify the status of funding provided in direct response to these  hurricanes at both the individual federal agency level as well as the  governmentwide level and to provide additional transparency so that  hurricane victims, affected states, as well as American taxpayers, know  how the government is spending these funds. We also  obtained the reports prepared by the Federal Emergency Management  Agency (FEMA) and the Army Corps of Engineers (COE) in response to  the second emergency supplemental appropriation act. Appendix II: Reporting Requirements Included in the Four Emergency Supplemental Appropriations Acts

The four emergency supplemental appropriations acts enacted as of   June 2006 provided funds to 23 federal agencies for the hurricane relief  and recovery effort and included different reporting requirements.
Why GAO Did This Study

Hurricane Katrina devastated the Gulf Coast region of the United States and caused billions of dollars in damage. Hurricanes Rita and Wilma further exacerbated damage to the region. The Federal Emergency Management Agency (FEMA), within the Department of Homeland Security (DHS), was tasked with the primary role of managing the federal relief and recovery efforts. This review was performed under the Comptroller General's authority because of widespread congressional interest in the response to this disaster. GAO examined whether the federal government was adequately tracking and reporting on the use of the funding provided in the four emergency supplemental appropriations acts enacted as of June 2006. GAO analyzed the emergency supplemental appropriations acts and conference reports, reviewed FEMA's required weekly reports, and interviewed federal agency officials.

What GAO Found

FEMA's required weekly reports to the Appropriations Committees on the use of funds it received do not provide timely information from a governmentwide perspective because FEMA does not have a mechanism to report on the financial activity of the agencies performing work on its behalf. Specifically, when FEMA tasks another federal agency through a mission assignment, FEMA records the entire amount upfront as an obligation, whereas the performing agency does not record an obligation until a later date, thereby overstating reported governmentwide obligations. The opposite is true for expenditures. The performing agency expends the funds, but then bills FEMA for reimbursement. FEMA does not record the expenditure until it has received the bill and reviewed it, thereby understating reported governmentwide expenditures. As a result, while FEMA is reporting as required, from a governmentwide perspective, FEMA's reported obligations are overstated and expenditures are understated. The federal government also does not have a governmentwide framework or mechanisms in place to collect and consolidate information from the individual federal agencies that received emergency supplemental appropriations for hurricane relief and recovery efforts and report on this information. About $88 billion has been appropriated to 23 different federal agencies through four emergency supplemental appropriations acts; however, no one agency or central collection point exists to compile and report on how these funds are being spent. Decision makers need this consolidated information to determine how much federal funding has been spent and by whom, whether more may be needed, or whether too much has been provided. The ability to separately track and report on these funds is important to help ensure better accountability and clearly identify the status of funding provided in direct response to these hurricanes at both the individual federal agency level as well as the governmentwide level. Also, it is important to provide additional transparency so that hurricane victims, affected states, as well as American taxpayers, know how these funds are being spent.