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$3.2 m

$2.9 m

$2.9 m

$3.6 m

$3.8 m

$4.0 m

Legal settlement

Contract solicitation

Bid submitted

Bid modified

Contract awarded

Contract modified

Contract modified

Contract modified

FEMA reaches legal settlement with disabled trailer occupants to pave areas around 150 trailers

FEMA solicits bid for non-competitive, sole source paving contract and sets government estimate at $2.9 million, below the 8(a) $3 million threshold on sole source contracts

Contractor submits $3.2 million contract bid to perform paving services

Contract officer drops 4 items from contract so award amount is $2.9 million, and below 8(a) threshold

2 days after soliciting bids, contract is awarded for $2.9 million

27 days after contract award, contract officer modifies contract to increase total award by $750,000, to $3.6 million, above 8(a) threshold

50 days after previous modification, contract is modified again, and total award is increased by $111,000, to $3.8 million

Two months later, contract is modified again, and total award is increased by $217,000, to $4.0 million

Source: GAO analysis of FEMA data.

Several sources told our investigators that the UFAS contracting officer had a long-term friendship with the subcontractor used by the company that received the contract. Our investigators attempted to ask the contracting officer about the preparation of the government estimate, the award and subsequent contract modifications, and her relationship to the subcontractor, but she refused to speak with them.

January 2007

February

11/1/06

12/21/06

1/31/07

$2.9 m

$3.6 m

$3.8 m

Figure 8: Timeline of UFAS Award and Subsequent Modifications

September 2006

October

9/26/06

10/2/06

November

December

10/4/06

10/4/06

10/4/06

Conclusion

Due to the unprecedented nature of the disasters resulting from the 2005 gulf coast hurricanes, it was understandable that FEMA did not immediately have effective systems in place to efficiently allocate work or to track the invoices submitted by the contractors for maintaining thousands of mobile homes and travel trailers. However, over 2 years have passed since the storms and FEMA is still wasting tens of millions of taxpayer dollars as a result of poor management and ineffective controls. It is critical that FEMA address weaknesses in its task order issuance and invoice review processes so that it can reduce the risk for wasteful and potentially fraudulent expenses and provide assurance that the government is getting what it pays for. Finally, while the placement of travel trailers at group and commercial sites might be necessary in the immediate aftermath of a disaster, going forward, FEMA needs to minimize the expenses associated with this type of temporary housing and

Page 34

GAO-08-106 Hurricane Katrina

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