Just weeks after the Department of Homeland Security (DHS) Office of Inspector General (IG) released its annual report to Congress on states’ and urban areas’ management of homeland security grant programs, the IG released an audit report revealing Ohio has shown little improvement in managing Homeland Security Grant Program (HSGP) funding.
The audit comes on the heels of another IG audit that found although states and urban areas generally administered homeland security grants efficiently and effectively in FY2014, strategic planning and oversight of grant activities by the Federal Emergency Management Agency (FEMA) needs improvement, Homeland Security Today earlier reported.
“Although we noted many of these same challenges in two previous audits of Ohio’s management of HSGP funding, FEMA has not changed its oversight practices to target Ohio’s areas of repeated deficiencies,” the audit report said. “Ohio continues to disregard some Federal regulations and grant guidance. Consequently, the State may be limited in its ability to prevent, prepare for, protect against, and respond to natural disasters, acts of terrorism, and other manmade disasters.”
DHS provides funding through HGSP to assist state and local agencies in enhancing their capabilities to prevent, protect, mitigate, respond to and recover from terrorist attacks, major disasters and other emergencies. FEMA is responsible for administration of HSGP.
FEMA awarded Ohio about $61.6 million in State Homeland Security Program (SHSP) and Urban Areas Security Initiative (UASI) grants during fiscal years 2010 through 2012. The IG found FEMA cannot be assured that Ohio effectively managed grant funds during these years.
In addition to inaccuracies in the State’s Biannual Strategy Implementation Reports (BSIR), DHS’s Inspector General also uncovered inaccuracies between program and accounting ledgers.
The IG’s auditors revealed that, “Ohio’s June 2013 BSIR included anticipated and actual spending of $1.6 million for state training and exercises, combined with state administration and other state spending, for a final total of $3.8 million in spending from its FY 2010 SHSP grant. However, when the FY 2010 grant expired on July 31, 2013, Ohio reported on its program ledger a final total of $1.7 million in state spending, a difference of $2.1 million.”
Officials indicated the June 2013 BSIR for the FY 2010 grant was inaccurate, but could not say why.
Ohio’s program ledger also was inaccurate. For example, for the FY 2010 grant, Ohio calculated total expenditures of $21,105,651 on its program ledger. However, the official accounting record shows total expenditures of $21,136,833. Moreover, the final expenditure amount Ohio reported to FEMA differed from both the amount in the program ledger and in the official accounting record.
Three previous audit reports disclosed deficiencies in Ohio’s management of the grant program, some of which are similar to those discussed in this audit report. For example, a DHS OIG report on SHSP and UASI grants awarded during fiscal years 2007 through 2009 revealed the State Administrative Agency did not release funds to subgrantees in a timely manner.
“The 24 Ohio subgrantees and four state agencies visited waited an average of 8 months (between 3 and 22 months) after the state obligated the grant funds to receive their 2007 grant award, with seven subgrantees waiting a year or more for the grant award,” states the report.
In 2008, delays increased to an average of 10 months, with three subgrantees waiting more than a year and two others waiting more than two years. Moreover, in 2009, delays increased to an average of 11 months with four subgrantees not receiving the 2009 grant awards until 19 months after Ohio reported to FEMA that these funds were obligated.
According to the subgrantees, “These delays resulted in price changes by vendors as the time from initial quotation to actual purchase expanded and, in turn, added work by the subgrantees to revise approved budgets.”
Although the Ohio Emergency Management Agency (OEMA) concurred with DHS’s Inspector General’s recommendation to work with subgrantees to assure funds are released within a reasonable time-frame, several years later DHS IG audits are uncovering the same problem.
The most recent audit found Ohio did not make grant funds available to subgrantees within 45 days as required by FEMA Homeland Security Grant Program Guidance. The IG’s audit report stated that, “Although Ohio improved the timeliness of releasing funds, it still did not comply with grant guidance.”
The auditors said that by delaying funding, Ohio lengthened the award process and delayed subgrantees’ procurement processes, which many diminish the state’s ability to prevent, prepare for, protect against and respond to disasters.
“Although OEMA has taken corrective actions to implement prior OIG recommendations, there has been limited improvement,” the audit report stated. “FEMA did not strengthen its monitoring of Ohio to ensure that Ohio was following all Federal regulations and grant guidance. FEMA’s general reviews of Ohio’s grants included the SHSP and UASI grants, but did not identify these reoccurring issues.”
“Because Ohio continues to face challenges in managing its HSGP funding, FEMA needs to provide more targeted and stronger oversight,” the report concluded.