Sneak Preview: FEMA To Update Public Assistance Pilot Guidance

June 28, 2018 | By Jerry Ashworth | Post a Comment

xsass_bookshot(The following was excerpted from a recent article in the Single Audit Information Service.) Federal Emergency Management Agency (FEMA) officials plan to update their internal guidance used to validate subrecipient cost estimates for work projects under FEMA’s Public Assistance alternative procedures pilot program, in response to a recent audit by the Department of Homeland Security (DHS) Office of Inspector General (OIG).

Congress enacted the Sandy Recovery Improvement Act of 2013 (SRIA) (Pub. L. 113-2) in January 2013 to enable FEMA to develop alternative procedures to relieve administrative burden and costs for recipients under the agency’s Public Assistance program, which provides disaster relief to state and local governments (i.e., grantees), as well as some nonprofit organizations (i.e., subgrantees). To help assist in the recovery of Hurricane Sandy under SRIA, FEMA launched a pilot program that applies to large permanent work projects in any major disaster declared on or after May 20, 2013. The pilot, which still has no determined end-date, also applies to large permanent work projects in major disasters declared prior to that date if construction for the project had not yet begun. As of July 2017, FEMA oversaw 252 work projects valued at $11.9 billion in the pilot program.

After reviewing the pilot program, the DHS OIG found that only 26 projects (10.32 percent) in the pilot program were closed as of July 2017. In addition, it determined that FEMA did not sufficiently document actions that it took to validate subrecipient cost estimates to ensure costs were reasonable.

The method FEMA uses to pay recipients for disaster recovery differs significantly between the pilot program and the traditional PA program. Under the pilot program, FEMA will fund subrecipients based on a fixed estimate of eligible costs. With its traditional PA program, FEMA reimburses subrecipients based on actual expenditures of eligible costs for each approved project.

FEMA has two internal documents to enable agency reviewers to validate subrecipient-provided estimates under the Public Assistance program. The Public Assistance Alternative Procedures Pilot Program Guide for Permanent Work, issued in March 2016, requires FEMA to evaluate and validate subrecipients’ estimates. This document mandates that FEMA conduct the review according to procedures outlined in the Public Assistance Alternative Procedures Pilot Program: Validation of Subgrantee-Provided Cost Estimates Job Aid, issued in May 2013.

The latter document includes the following steps for validating subrecipients’ cost estimates: (1) review the scope of work and cost estimate to verify that only eligible items are included; (2) determine whether unit costs are derived from an approved source of industry standard information; (3) determine the components of unit costs; (4) validate the cost estimate for completeness and reasonableness; (5) incorporate the validated cost estimate into the subgrant; and (6) return cost estimates that cannot be validated to the subrecipient for revision.

(The full version of this story has now been made available to all for a limited time on Thompson’s Grants Compliance Expert site.)

As a reminder, we have all of our Federal Funding Training Forums scheduled for 2018. Please let me know if you have questions or can make any of these. We hope to see you there!

  • Wednesday July 25 – Friday July 27 in MINNEAPOLIS

http://www.federalgrantsforum.com/minneapolis/index.html?src=AT

  • Wednesday October 17 – Friday October 19 in ATLANTA

http://www.federalgrantsforum.com/atlanta/index.html?src=AT

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