Management Alert - Observations and Concerns with FEMA's Housing Assistance Program for Hurricane Harvey Efforts in Texas

FEMA is currently responding to Hurricanes Harvey, Irma, and Maria, some of the most catastrophic disasters in recent United States history. Damages from Hurricane Harvey are estimated to exceed $100 billion. On September 22, 2017, The State of Texas General Land Office (Texas) entered into an Intergovernmental Service Agreement (agreement) to provide assistance to FEMA in the delivery of Direct Housing Assistance (DHA) to Hurricane Harvey survivors on a temporary basis. FEMA estimates these costs will reach approximately $1 billion. The agreement does not clearly identify basic controls to ensure (DHA) funds are spent according to Federal regulations. For instance, the agreement does not include approval authorities and physical inspections, or separation of duties and independent certifications. We are concerned that without adequate controls in place the federal funds may be at risk of fraud, waste, and abuse. Therefore, it is imperative that FEMA ensure Texas’ proposed project management plan clearly identifies the internal controls needed to ensure that Federal funds will be properly spent. It also provides observations on the current and past issues with FEMA’s use of direct housing assistance programs.