[House Hearing, 113 Congress]
[From the U.S. Government Publishing Office]



 
          HOMELAND SECURITY GRANTS: MEASURING OUR INVESTMENTS

=======================================================================


                                HEARING

                               before the

                       SUBCOMMITTEE ON EMERGENCY

                        PREPAREDNESS, RESPONSE,

                           AND COMMUNICATIONS

                                 of the

                     COMMITTEE ON HOMELAND SECURITY

                        HOUSE OF REPRESENTATIVES

                    ONE HUNDRED THIRTEENTH CONGRESS

                             FIRST SESSION

                               __________

                             MARCH 19, 2013

                               __________

                            Serial No. 113-6

                               __________

       Printed for the use of the Committee on Homeland Security
                                     

[GRAPHIC] [TIFF OMITTED] 


                                     

      Available via the World Wide Web: http://www.gpo.gov/fdsys/

                               __________



                  U.S. GOVERNMENT PRINTING OFFICE
82-500                    WASHINGTON : 2013
-----------------------------------------------------------------------
For sale by the Superintendent of Documents, U.S. Government Printing 
Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC 
area (202) 512-1800 Fax: (202) 512-2104  Mail: Stop IDCC, Washington, DC 
20402-0001



                     COMMITTEE ON HOMELAND SECURITY

                   Michael T. McCaul, Texas, Chairman
Lamar Smith, Texas                   Bennie G. Thompson, Mississippi
Peter T. King, New York              Loretta Sanchez, California
Mike Rogers, Alabama                 Sheila Jackson Lee, Texas
Paul C. Broun, Georgia               Yvette D. Clarke, New York
Candice S. Miller, Michigan, Vice    Brian Higgins, New York
    Chair                            Cedric L. Richmond, Louisiana
Patrick Meehan, Pennsylvania         William R. Keating, Massachusetts
Jeff Duncan, South Carolina          Ron Barber, Arizona
Tom Marino, Pennsylvania             Dondald M. Payne, Jr., New Jersey
Jason Chaffetz, Utah                 Beto O'Rourke, Texas
Steven M. Palazzo, Mississippi       Tulsi Gabbard, Hawaii
Lou Barletta, Pennsylvania           Filemon Vela, Texas
Chris Stewart, Utah                  Steven A. Horsford, Nevada
Keith J. Rothfus, Pennsylvania       Eric Swalwell, California
Richard Hudson, North Carolina
Steve Daines, Montana
Susan W. Brooks, Indiana
Scott Perry, Pennsylvania
                       Greg Hill, Chief of Staff
          Michael Geffroy, Deputy Chief of Staff/Chief Counsel
                    Michael S. Twinchek, Chief Clerk
                I. Lanier Avant, Minority Staff Director
                                 ------                                

  SUBCOMMITTEE ON EMERGENCY PREPAREDNESS, RESPONSE, AND COMMUNICATIONS

                  Susan W. Brooks, Indiana, Chairwoman
Peter T. King, New York              Donald M. Payne, Jr., New Jersey
Tom Marino, Pennsylvania             Yvette D. Clarke, New York
Steven M. Palazzo, Mississippi       Brian Higgins, New York
Scott Perry, Pennsylvania            Bennie G. Thompson, Mississippi 
Michael T. McCaul, Texas (ex             (ex officio)
    officio)
            Eric B. Heighberger, Subcommittee Staff Director
                   Deborah Jordan, Subcommittee Clerk


                            C O N T E N T S

                              ----------                              
                                                                   Page

                               Statements

The Honorable Susan W. Brooks, a Representative in Congress From 
  the State of Indiana, and Chairwoman, Subcommittee on Emergency 
  Preparedness, Response, and Communications.....................     1
The Honorable Donald M. Payne, Jr., a Representative in Congress 
  From the State of New Jersey, and Ranking Member, Subcommittee 
  on Emergency Preparedness, Response, and Communications........     2
The Honorable Bennie G. Thompson, a Representative in Congress 
  From the State of Mississippi, and Ranking Member, Committee on 
  Homeland Security..............................................     4

                               Witnesses

Mr. Tim Manning, Deputy Administrator, Protection and National 
  Preparedness, Federal Emergency Management Agency:
  Oral Statement.................................................     6
  Prepared Statement.............................................     8
Ms. Anne L. Richards, Assistant Inspector General for Audits, 
  Office of Inspector General, U.S. Department of Homeland 
  Security:
  Oral Statement.................................................    12
  Prepared Statement.............................................    14
Mr. David C. Maurer, Director, Homeland Security and Justice 
  Issues, Government Accountability Office:
  Oral Statement.................................................    20
  Prepared Statement.............................................    21

                                Appendix

Questions From Chairman Susan W. Brooks for Tim Manning..........    47
Question from Chairman Susan W. Brooks for Anne L. Richards......    48
Questions From Chairman Susan W. Brooks for David C. Maurer......    48


          HOMELAND SECURITY GRANTS: MEASURING OUR INVESTMENTS

                              ----------                              


                        Tuesday, March 19, 2013

             U.S. House of Representatives,
 Subcommittee on Emergency Preparedness, Response, 
                                and Communications,
                            Committee on Homeland Security,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:04 a.m., in 
Room 311, Cannon Office Building, Hon. Susan W. Brooks 
[Chairwoman of the subcommittee] presiding.
    Present: Representatives Brooks, Marino, Palazzo, Perry, 
Payne, Thompson, and Clarke.
    Mrs. Brooks. The Committee on Homeland Security, 
Subcommittee on Emergency Preparedness, Response, and 
Communications will come to order. The subcommittee is meeting 
today to examine the administration of grants at the Department 
of Homeland Security.
    I will now recognize myself for an opening statement.
    After holding a number of site visits and briefings over 
this past month, the subcommittee is convening to hold its 
first hearing of the 113th Congress on a subject that has had a 
great impact on the prevention, preparedness, and response 
capabilities of our State and local partners. That is homeland 
security grants.
    The September 11 terrorist attacks exposed significant gaps 
in prevention, preparedness, and response capabilities at all 
levels of government. As a result, a suite of grant programs 
was created to address these issues and enhance our 
preparedness as a Nation.
    To date, nearly $40 billion has been distributed to States 
and localities through these grants. According to the National 
Preparedness Report, which was released last year by FEMA, 
progress in building and sustaining capabilities has been made 
as a result of these grants.
    According to this report, Federal preparedness assistance 
programs have helped build and enhance State, local, Tribal, 
and territorial capabilities through multi-year investments 
across mission areas. The report goes on to say that Federal 
preparedness assistance has clearly contributed to the 
capability gains achieved since 9/11.
    However, as has been noted by the Government Accountability 
Office and the DHS Inspector General, FEMA has still been 
unable to develop comprehensive measures and metrics to 
quantify the impact of these grant investments on grantee 
capabilities. Although a difficult task, we must always ensure 
that we are good stewards of taxpayer dollars and we are able 
to justify and account for these significant investments.
    The 9/11 Act, which became law in 2007, states that in 
order to ensure that the States and high-risk urban areas are 
appropriately using grants administered by the Department, the 
FEMA administrator shall use performance metrics, and ensure 
that any such State or high-risk area regularly tests its 
progress against these metrics.
    Still, nearly 6 years later, we are still waiting for 
comprehensive measures with respective to the metrics.
    Anecdotally, we know that these grants have made a 
difference, most definitely. The National Network of Fusion 
Centers has enhanced intelligence and information sharing. 
Emergency plans have been better developed, updated, and 
exercised. Emergency response providers have received important 
training. Investments in vital communications capabilities have 
been made.
    However, we also know that challenges and capability gaps 
still remain. But without appropriate measures and metrics, we 
can't ensure that these grants are going to address critical 
capabilities in the area with the greatest risk.
    We are all aware of the grave fiscal challenges facing all 
levels of government. We must ensure we are getting a return on 
our investment and that each and every grant dollar is used 
appropriately. When it comes to our--however, when it comes to 
our security, we can't afford to waste a single dollar.
    Last Congress, this subcommittee held a number of hearings 
on homeland security grants--and in fact, I learned almost 1 
year ago yesterday--or a year ago tomorrow, as I understand 
it--and the capabilities that have been attained since 9/11.
    We continue this important oversight today. We have many 
questions about the impacts of these grants and about how these 
dollars are utilized, how their impact is being measured and 
how the Department and FEMA are ensuring that the grants are 
being used in an appropriate manner, according to their intent.
    I hope today's hearing will answer several key questions. 
What progress has been made in FEMA's efforts to measure the 
impact of the homeland security grants? What steps are being 
taken to ensure that grant funds are being used in accordance 
with the grant guidance?
    What progress has FEMA made since this subcommittee held a 
hearing on grants almost exactly a year ago? How will the 
THIRAs help inform the investment justification and project 
approval process?
    Then based, finally, on the findings of the National 
Preparedness Report, what are the capabilities most yet in need 
of investment?
    So I am pleased to welcome our distinguished panel of 
witnesses. I look forward to hearing your perspectives on these 
important topics.
    Now the Chairwoman would recognize the gentleman from New 
Jersey, Mr. Payne, for any opening statement you might have.
    Mr. Payne. Good morning. Thank you, Madam Chairwoman 
Brooks, for convening today's hearing.
    I also want to thank our panel of witnesses, and thank them 
for testifying today.
    Madam Chairwoman, before I move forward with my opening 
statement, I would like to commend FEMA's response, recovery, 
and relief efforts related to Hurricane Sandy. As a native of 
New Jersey, I can attest to the severe damage caused to our 
public and private properties, critical infrastructure, and 
transportation systems.
    The coordinated efforts to foster regional collaboration 
with our local first responders and neighborhoods and 
neighboring States is a testament of the whole-community 
approach.
    Thank you.
    Today, we will discuss FEMA's efforts to measure the return 
on investment from homeland security grants provided to States 
and locals, as well as identify and close preparedness gaps 
with homeland security resources. Also, we are eager to learn 
about FEMA's fiscal year 2012 impractical proposal to 
consolidate 16 homeland security grants under their National 
Preparedness Grant Program.
    FEMA's homeland security grants have enhanced State, 
territory, local, and Tribal government capabilities to plan, 
coordinate, and train to prepare and to respond to any natural, 
terroristic attack or catastrophic situations.
    Since 2002, Congress has appropriated $39 billion for 
homeland security grants. Congress and FEMA would like to use 
this hearing to further investigate and understand the returns 
on investment taxpayers are receiving from the grant program.
    We have to determine how homeland security grants have 
specifically helped our communities become further equipped to 
handle threats and natural disasters, and how we can sustain 
our preparedness.
    It is for this reason that Congress has directed FEMA to 
establish performance metrics that would allow States and urban 
areas to report the capabilities they have built with Federal 
funding.
    Over the years, FEMA has presented plans to gauge the 
effectiveness of its homeland security grants. However, it is a 
history of mostly unsuccessful attempts.
    The OIG, GAO, and the National Academy for Public 
Administration released respective findings that FEMA must do 
the following: Improve its guidance in establishing performance 
metrics and measurements, establish qualitative and 
quantitative frameworks to measure grants' performance, and 
develop and implement a system for assessing natural 
preparedness capabilities.
    In addition to the findings of the OIG, GAO, and the NAPA, 
staff have learned that critical information about the success 
of grant programs such as UASI, MMRS, and others have not been 
properly conveyed to Congress.
    It would be unfortunate for wholesale changes and cuts to 
be made to our grant programs that result in the elimination of 
capabilities necessary to meet complex challenges of 
emergencies because FEMA has not clearly presented the efforts 
of the State and locals.
    Mr. Manning, I admire FEMA's attempts to promote and 
streamline the grant process. But I am confounded to hear from 
our homeland security stakeholders about the Department's 
audacity to move forward with the implementation of NPGP 
despite Congressional opposition.
    Last year, the Senate and House rejected this proposal 
because it lacked the necessary details and stakeholder 
outreach. Last week, the Senate Appropriations released 
Consolidated and Further Appropriations Act of 2013, which 
rejected the NPGP proposal, due to the lack of justification, 
and includes bill language prohibiting obligations of funds for 
such programs, or any successive program, unless authorized by 
Congress.
    Congress created discrete programs to direct grant 
investments to address specific gaps in National and local 
preparedness capabilities. Measuring preparedness is a 
difficult task. But I hope this hearing will help us better 
understand how FEMA can successfully move forward in achieving 
its goals of ensuring that local communities have the necessary 
tools, resources, and processes to keep their people safe.
    I look forward to hearing FEMA's response to our concerns 
and its efforts to implement performance measures.
    Thank you, Madam Chairwoman. I yield back.
    Mrs. Brooks. Thank you.
    The Chairwoman now recognizes the Ranking Member of the 
full committee, gentleman from Mississippi, Mr. Thompson. Any 
statement you might have?
    Mr. Thompson. Thank you very much, Madam Chairwoman. I 
would like to thank you for holding this hearing, as well as 
our Ranking Member, Mr. Payne, also. I think this is the maiden 
voyage for both of you. Congratulations.
    From the Urban Area Security Initiative and the State 
Homeland Security Program to the Port Security Grant Program 
and the Transit Security Grant Program, the preparedness grant 
programs administered by the Federal Emergency Management 
Agency help build critical disaster response capability in 
every Congressional district.
    Over the past 10 years, we have invested around $39 billion 
in these and other homeland security grant programs. When we go 
back to our districts, we hear anecdotal stories about how 
homeland security grant program funding has supported a 
tabletop exercise to test a local emergency operation plan or 
to purchase technology that will help first responders to do 
their job quicker, better, and safer.
    Communities across the country are proud of the 
preparedness capabilities that they have worked to develop over 
the past 10 years, a feat made possible by support from 
Homeland Security Grant Program.
    But now these capabilities may be mothballed. Federal, 
State, and local budgets are stretched more and more every 
year. Large grant awards that helped State and local 
governments prepare for manmade and natural disasters are 
becoming less common, but the threats, disasters posed are not.
    With less Federal support available, State and local 
governments are struggling to maintain the capabilities 
achieved over the past decade. Our oversight responsibilities 
include making sure FEMA uses its limited preparedness funding 
wisely.
    For at least 5 years, this committee has been asking FEMA 
to develop capability objectives and metrics to help State and 
local governments prioritize grant investments. I am also 
concerned that FEMA has not yet implemented the grant 
management and oversight practices necessary to ensure that the 
limited grant money available is spent effectively and 
efficiently.
    I am disappointed to read in one after another GAO and I.G. 
report identifying management failures that have led to 
duplicative purchases or increased administrative costs. Now 
more than ever, FEMA must develop and implement the tools 
necessary to efficiently manage the limited grant funds awarded 
each year.
    We cannot afford for Homeland Security Grant Program 
dollars to be spent on unnecessary equipment because metrics 
are not available to determine whether a State or local 
government has sufficient resources to meet its preparedness 
needs.
    We cannot afford for Homeland Security Grant Program 
dollars to be spent on duplicate purchase because FEMA has not 
taken the necessary action to ensure grantees use appropriate 
inventory practices.
    Although I understand that FEMA has made progress in 
implementing the recommendations of GAO and the DHS I.G. to 
improve grant management, I was encouraged by the release of 
the National Preparedness Report last year.
    I am interested to learn from Deputy Administrator Manning 
how FEMA will continue its efforts to manage and measure the 
effectiveness of grants.
    Finally, I would like to make a brief comment on the 
National Preparedness Grant Program. As you may recall, Deputy 
Administrator Manning, Members of this committee, as 
authorized, were surprised to read for the first time a 
proposal to consolidate 16 targeted grant programs in the 
fiscal year 2013 budget request last year.
    Members of this committee rejected that proposal, 
expressing concern about the Department's failure to work with 
authorizers and other stakeholders during the development of 
the NPGP. Appropriators were similarly apprehensive and have 
not provided funding in any other fiscal year 2013 spending 
bills.
    I understand that the administration plans to submit the 
NPGP proposal again in the fiscal year 2014 budget request. 
Before doing so, I would urge you to provide Members of this 
committee a detailed briefing explaining how the grant 
proposals were developed, how the feedback of stakeholders was 
solicited and incorporated, specific details about the funding 
structure and how you expect the new grant program will address 
the flaws in the Homeland Security Grant Program identified by 
DHS I.G. and GAO.
    The Ranking Member has also referenced some Senate activity 
around this, where they just basically said, don't do it. I 
think it is important that, as authorizers, you do come and 
say, here is what we plan to do. So I look forward to hearing 
from you on that.
    I would like to also thank the other witnesses for being 
here today. I look forward for their testimony.
    I yield back, Madam Chairwoman.
    Mrs. Brooks. Thank you.
    Other Members of the committee are reminded that opening 
statements may be submitted for the record. We are pleased to 
have a very distinguished panel before us today on this 
important topic.
    Mr. Tim Manning is the deputy administrator for protection 
and national preparedness at the Federal Emergency Management 
Agency. In this capacity, he oversees the National Preparedness 
Directorate, the Grants Program Directorate, the National 
Continuity Programs Directorate and the National Capital Region 
Coordination Directorate. That is a mouthful.
    Mr. Manning brings to FEMA nearly 2 decades of emergency 
management experience, including service as a firefighter, 
emergency medical technician, and a rescue mountaineer.
    Mr. David Maurer is a director in the U.S. Government 
Accountability Office's Homeland Security and Justice Team, 
where he leads GAO's work reviewing DHS and DOJ management 
issues. His recent work in these areas includes DHS management 
integration, the Quadrennial Homeland Security Review, Secret 
Service financial management, DOJ grant management, the Federal 
prison system, and an assessment of technologies for detecting 
explosives in the passenger rail environment.
    Last, but certainly not least, and who was here last year, 
as I understand, Ms. Anne Richards is the assistant inspector 
general for the Office of Audits within the Department of 
Homeland Security's Office of Inspector General. Prior to 
joining OIG in 2007, Ms. Richards served in the Department of 
the Interior, including as the assistant inspector general for 
audits.
    Ms. Richards has also held a number of positions with the 
U.S. Army Audit Agency.
    The witnesses' full written statements will appear in the 
record. The Chairwoman now recognizes Mr. Manning for 5 minutes 
for an opening statement.

STATEMENT OF TIM MANNING, DEPUTY ADMINISTRATOR, PROTECTION AND 
   NATIONAL PREPAREDNESS, FEDERAL EMERGENCY MANAGEMENT AGENCY

    Mr. Manning. Madam Chairwoman, good morning. Thank you very 
much.
    Ranking Member Payne, Members of the subcommittee, good 
morning.
    I am Tim Manning, FEMA's deputy administrator for 
protection and national preparedness. On behalf of Secretary 
Napolitano and Administrator Fugate, thank you for the 
opportunity to appear this morning.
    As you know, FEMA's preparedness grant programs have 
contributed significantly to the overall security preparedness 
of the Nation. We are more secure and better prepared to 
prevent, protect, and mitigate the impacts of all threats than 
we have been at any other time in our history.
    We plan better. We train better. We work together better. 
We respond and recover better. With each passing year, our 
planning, preparations, and capabilities continue to mature.
    Much of this progress has come from leadership at the State 
and local levels, fueled by FEMA's grant programs. Over the 
past 10 years, Congress, through DHS, has provided State, 
territorial, local, and Tribal governments with more than $39 
billion.
    We have built and enhanced capabilities by acquiring needed 
equipment, training, developing plans, exercising and building 
relationships across city, county, and State lines. Although 
Federal funds represent just a fraction of what has been spent 
on homeland security across the Nation overall, these funds and 
the development of capabilities that they have made possible, 
have fundamentally changed the level of preparedness in the 
United States.
    The first National Preparedness Report, released last year, 
provided specific accomplishments in the context of the core 
capabilities identified in the National Preparedness Goal. 
Among the report's findings, the Nation has made significant 
progress and has achieved a high degree of maturity in several 
core capabilities, particularly in the cross-cutting, common 
capabilities and those that support disaster response.
    Planning, operational coordination, interoperable 
communications, intelligence and information sharing, 
environmental response, health and safety, search and rescue, 
and public health and medical services stood out as areas where 
we are particularly strong. This is due, in large part, to the 
significant investments we have made in those areas.
    The development and maturation of the State and major area 
fusion centers represents one other example of the impact our 
grant programs have had in States and communities across the 
Nation. Fusion centers function as a focal points, information 
hubs within State and local jurisdictions to provide for the 
gathering and sharing of critical information and intelligence 
among Federal, State, and local agencies.
    There are currently 78 designated State and major urban 
area fusion centers across the country.
    FEMA preparedness grant programs have also built 
operational coordination capabilities, specifically helping to 
establish the National Incident Management System, or NIMS, as 
the common incident management doctrine for the Nation.
    Prior to the introduction of NIMS in 2004, the Nation had 
no single, official incident management system. By 2011, nearly 
10 million homeland security and emergency management 
professionals, volunteers, and students from across the Nation 
had successfully completed the FEMA-sponsored independent study 
courses on NIMS. It is used widely.
    One of our most visible success stories involves the 
search-and-rescue capabilities we have built across the Nation 
with our homeland security grant dollars. Currently, there are 
300 State and local urban area search and rescue teams. Only 55 
percent of those teams existed prior to 2001.
    At the time of the September 11, 2001 terrorist attacks, 
many major population centers across the United States lacked 
advanced search-and-rescue coverage. But today, there are urban 
search-and-rescue teams--organized urban search-and-rescue 
teams within a 4-hour drive of 97 percent of the Nation's 
population.
    This National expansion of State and local urban search-
and-rescue capabilities is a direct response--or direct result 
of the Federal funding and training from this program.
    In March 2011, President Obama signed Presidential Policy 
Directive, PPD-8 on National preparedness, directing the 
development of a National preparedness goal.
    Plainly stated, the goal, developed through a collaborative 
process, including all levels of government, the private 
sector, the general public, envisions a secure and resilient 
Nation with the capabilities required across the whole 
community to prevent, protect, mitigate, respond, and recover 
from threats and hazards that pose the greatest risk.
    This year, FEMA released the methodology for determining 
risks through the Threat and Hazard Identification and Risk 
Assessment, or THIRA. The approach allows a jurisdiction to 
establish its own capability targets based on the threats and 
hazards that exist with that jurisdiction, and expands on 
existing State, local, territorial, and Tribal hazard 
identification and risk assessments by incorporating whole-
community approaches from the beginning to the end of the 
process, and accounting for important community-specific 
factors.
    In conclusion, we have demonstrated the efficacy of our 
programs through a reasoned analysis of the threats and hazards 
that exist across the country, and the attendant core 
capabilities that can be applied to those hazards.
    The National Preparedness Goal provides us with a clearly 
defined target to work towards. We have greatly improved the 
ability to assess our needs and track spending towards meeting 
those needs. Consolidating many of our programs will eliminate 
duplication and bring focus to the overall effort.
    Thank you for the opportunity again to discuss these 
important issues this morning. I look forward to the 
conversation and addressing any questions the committee may 
have.
    Thank you.
    [The prepared statement of Mr. Manning follows:]
                 Prepared Statement of Timothy Manning
                             March 19, 2013
    Chairwoman Brooks, Ranking Member Payne, and Members of the 
subcommittee: Good morning. I am Timothy Manning, FEMA's deputy 
administrator for protection and national preparedness. On behalf of 
Secretary Napolitano and Administrator Fugate, it is my pleasure to 
appear before you today to discuss the Department of Homeland 
Security's (DHS) preparedness grant programs.
    As this committee is aware, FEMA's preparedness grant programs have 
contributed significantly to the overall security and preparedness of 
the Nation. By providing funds, encouraging State and local 
collaboration, and encouraging planning, these programs have enhanced 
the security and preparedness of States, territories, Tribal nations, 
regions, cities, borders, ports, and transit systems. As a Nation, we 
are more secure and better prepared to prevent, protect, and mitigate 
the impact of all threats than we have been at any time in our history. 
We plan better, we train better, we work together better, and we 
respond and recover better. And with each passing year, our planning, 
preparations, and capabilities continue to mature.
    Much of this progress has come from leadership at the State and 
local levels, fueled by the preparedness grant programs. Over the past 
10 years, Congress, through the Department of Homeland Security, has 
provided State, territorial, local, and Tribal governments with more 
than $35 billion in funding to enhance the Nation's ability to plan 
for, protect against, prevent, mitigate, respond to, and recover from 
natural disasters, terrorist attacks, and other events. We have built 
and enhanced capabilities by acquiring needed equipment, offering 
training to personnel, developing plans, exercising and building 
relationships across city, county, and State lines. Although Federal 
funds represent just a fraction of what has been spent on homeland 
security across the Nation overall, these funds and the development of 
capabilities they have made possible, have changed the culture of 
preparedness in the United States.
    The first National Preparedness Report, released last year, 
provided specific accomplishments in the context of the core 
capabilities identified in the National Preparedness Goal. Among the 
Report's findings, the Nation has made significant progress and has 
achieved a high degree of maturity in several core capabilities, 
particularly in cross-cutting, common capabilities and those that 
support disaster response. Planning, operational coordination, 
interoperable communications, intelligence and information sharing, 
environmental response, health and safety, search and rescue, and 
public health and medical services stood out as areas where we are 
particularly strong. This is due in large part to the significant 
investments we have made in those areas. Since 2006, our State, local, 
Tribal, and other partners have applied for more than $7.3 billion in 
preparedness assistance from DHS to support the core capabilities 
identified in the National Preparedness Goal.
    The development and maturation of State and major urban area fusion 
centers represent just one example of the impact our grant programs 
have in States and communities across the Nation. Fusion centers 
function as focal points--information hubs--within State and local 
jurisdictions to provide for the gathering, receipt, analysis, and 
sharing of critical information and intelligence among Federal, State, 
and local agencies. Funding to support fusion centers has been 
leveraged from several of the Homeland Security Grant Programs, 
specifically the State Homeland Security Program (SHSP) and the Urban 
Areas Security Initiative (UASI) Grant Program. As of March 2013, 78 
designated State and major urban area fusion centers exist nationally, 
greatly enhancing the Nation's ability to share critical information 
among all levels of government and the private sector.
    Additional areas of success include improved planning capabilities 
and operational coordination among response agencies. For example, the 
Nation has significantly improved the adequacy, feasibility, and 
completeness of plans for catastrophic events, due in part to 
significant State and local investments in planning activities through 
FEMA grant programs. The 2010 Nation-wide Plan Review showed 
significant increases from 2006 in the number of jurisdictions 
confident in their plans for catastrophic events. By 2010, more than 75 
percent of States and more than 80 percent of urban areas were 
confident that their overall basic emergency operations plans were 
well-suited to meet the challenges of a large-scale catastrophic event. 
Additionally, both States and urban areas show high degrees of 
confidence in their functional plans appendices and in their hazard-
specific plans. Not surprisingly, they were particularly confident in 
plans for events with which they have some experience, such as flooding 
or tornadoes. FEMA has included planning as an allowable use of grants 
since 2003 and has emphasized planning as a priority for preparedness 
funding since 2006.
    FEMA preparedness grant programs also have built operational 
coordination capabilities, specifically helping to establish the 
National Incident Management System (NIMS) as the common incident 
management doctrine for the Nation. Prior to the introduction of NIMS 
in 2004, the Nation had no single, official incident management system. 
By 2011, nearly 10 million homeland security and emergency management 
professionals, volunteers, and students from across the Nation had 
successfully completed the FEMA-sponsored independent study courses on 
the National Incident Management System.
    One of our most visible success stories involves the search-and-
rescue capabilities we have built across the Nation with our homeland 
security grant dollars. Currently, there are approximately 300 State 
and/or local urban search-and-rescue (US&R) teams; only 55 percent of 
these teams existed prior to 2001. At the time of the September 11, 
2001 terrorist attacks, many major population centers in the United 
States lacked search-and-rescue coverage. Today, there are US&R teams 
within a 4-hour drive of 97 percent of the Nation's population. This 
National expansion of State and local US&R capabilities is a direct 
result of Federal funding and training: From fiscal year 2006 through 
fiscal year 2010, recipients of State and local homeland security grant 
funds allocated approximately $158 million in preparedness assistance 
to build and maintain US&R capabilities. As a result, in the aftermath 
of the deadly April 2011 outbreak of tornadoes in the United States, 
Alabama mobilized State and local US&R teams to support response 
operations in Marion, Jefferson, Franklin, and Tuscaloosa counties. 
This enhanced local and regional capacity resulted in a faster and more 
effective response than would previously have been possible. The entire 
search-and-rescue operation was conducted by State and local assets. 
Federal resources were never requested, and that is the ultimate marker 
of success.
                        monitoring our progress
    As our preparedness has improved so, too, has our ability to 
measure preparedness and to understand the role played by the grant 
programs in these improvements. In the past several years, FEMA has 
made significant improvements to its internal operations and in its 
management and oversight of the Homeland Security Grant Program. We 
also have enhanced our ability to measure the effectiveness of grant 
dollars on the Nation's overall preparedness.
    I would first like to discuss FEMA's grant monitoring programs, 
which involves both financial and programmatic oversight to ensure 
accountability and proper management of preparedness grants. Our 
monitoring regime ensures that:
   Funds are used in accordance with Federal law, regulations, 
        and administrative procedures.
   Funds are utilized to meet the objectives of the grant 
        program as determined by law or grant guidance.
   Waste, fraud, and abuse of grant funding is identified where 
        it may exist and is eliminated.
   Grantees are practicing sound grant management practices and 
        making progress toward program goals.
    In fiscal year 2013, FEMA implemented an integrated monitoring plan 
designed to realize efficiencies and improve information sharing 
between the financial and programmatic monitoring staff. While 
financial and programmatic monitoring works hand-in-hand, they entail 
separate methodologies and processes. Financial monitoring focuses on 
compliance with statutory, regulatory, and FEMA grant administration 
requirements. Programmatic monitoring is designed to identify 
administrative or performance issues that threaten the success of grant 
objectives, and to target assistance to resolve those issues as early 
as possible in the grant cycle--before they become crises. Over time, 
the integrated analysis of financial and programmatic monitoring data 
will increase our ability to identify common issues and challenges and 
to proactively target assistance to grantees.
    The foundation of the integrated monitoring program is an 
assessment-based approach to portfolio management that allows FEMA to 
direct scarce monitoring resources to grantees and programs that may 
require additional attention or assistance. Under the assessment-based 
approach, every open grant is reviewed annually using a programmatic 
baseline assessment as well as a periodic analysis of cash 
transactions. The programmatic baseline assessment looks at key 
indicators of risk including: The dollar value of the grant, prior 
indications of problems, whether the grantee is new or has had a recent 
change in staff, the grantee's audit history, its record of 
responsiveness and collaboration, the complexity of the grant and the 
amount of time since the last assessment site visit.
    The cash analysis is completed quarterly or semi-annually, 
depending on the grant program, and compares grant draw-down 
information to grant implementation progress reports to track financial 
progress. These reviews help FEMA determine which grants should receive 
further attention, either through closer examination of records 
submitted by the grantee, or through site visits, to review 
documentation with the grantee.
    This approach lays the foundation for future financial assessment-
based monitoring that will support FEMA's and DHS's risk management 
philosophy. As a result of these efforts, over the past 2\1/2\ years 
FEMA has made significant improvements to its grant monitoring 
activities. In the future, FEMA will require all grant applications to 
include project-level information. This will provide FEMA with an 
unprecedented level of information about how grantees are using their 
grant funds. This will improve FEMA's ability to ensure that grant 
spending is efficient, targeted, and coordinated and will better enable 
FEMA to document how grantees are making progress towards filling 
capability gaps.
        measuring preparedness: the national preparedness system
    In March 2011, President Obama signed Presidential Policy Directive 
(PPD) 8 on National Preparedness. In it, the President directed the 
development of a National Preparedness Goal that identifies the core 
capabilities necessary for preparedness and a National Preparedness 
System to guide activities that will enable the Nation to achieve the 
goal. Plainly stated, the National Preparedness Goal, developed through 
a collaborative process including all levels of Government, the private 
sector, and the general public, envisions a secure and resilient Nation 
with the capabilities required across the whole community to prevent, 
protect against, mitigate, respond to, and recover from the threats and 
hazards that pose the greatest risk.
    As a Nation, we cannot understand our progress in achieving the 
National Preparedness Goal (NPG) without an understanding of our 
collective preparedness efforts. The National Preparedness System is 
the instrument the Nation will employ to build, sustain, and deliver 
those core capabilities in order to achieve the goal of a secure and 
resilient Nation. The components of the National Preparedness System 
include: Identifying and assessing risk, estimating the level of 
capabilities needed to address those risks, building or sustaining the 
required levels of capability, developing and implementing plans to 
deliver those capabilities, validating and monitoring progress, and 
reviewing and updating efforts to promote continuous improvement.
    Developing and maintaining an understanding of the variety of risks 
faced by communities and the Nation, and how this information can be 
used to build and sustain preparedness, are essential components of the 
National Preparedness System. Risk varies across the Nation--for 
example, a municipal risk assessment will reflect a subset of the 
threats, hazards, and related consequences contained in a State or 
Federal risk assessment. A risk assessment collects information 
regarding the threats and hazards, including the projected consequences 
or impacts.
    This year, FEMA released the methodology for determining risks in 
Comprehensive Preparedness Guide 201: Threat and Hazard Identification 
and Risk Assessment (THIRA) Guide (CPG-201). The THIRA process is an 
all-hazards assessment tool developed by FEMA for use by jurisdictions 
of all sizes. Diverging from past efforts to establish measures and 
metrics for a capability that would be applied uniformly, this approach 
allows a jurisdiction to establish its own capability targets based on 
the risks it faces. It expands on existing local, State, territorial, 
and Tribal hazard identification and risk assessments and other risk 
methodologies by broadening the factors considered in the process, 
incorporating the whole community from the beginning to the end of the 
process, and by accounting for important community-specific factors. 
This knowledge allows a jurisdiction to establish informed and 
defensible capability targets and commit appropriate resources to 
sustain existing capabilities and to close the gap between current 
capabilities and the required levels identified during the capability 
estimation process.
    When existing capabilities need to be supplemented to reach a 
required level, communities might develop strategies that address 
shortfalls through local, regional, or National mutual aid agreements 
or they could choose to obtain the necessary resources through the 
private sector. They also may determine that they need to build a 
capability themselves, and they may choose to use Federal preparedness 
grants to do so. Cities, counties, States, territories, and Tribes may 
require the resources of other levels of government to achieve a 
capability target, especially for catastrophic incidents. Accordingly, 
FEMA requires States to participate in the Emergency Management 
Assistance Compact (EMAC) as a condition for grant funding. EMAC offers 
assistance during a Governor's declared State of Emergency through a 
responsive, straight-forward system that allows States to send 
personnel, equipment, and commodities to help disaster relief efforts 
in other States.
    The results of the THIRA and other National Preparedness System 
components, such as the capability estimation process, are designed to 
allow jurisdictions at all levels of government to make informed 
decisions about how to allocate their resources to build and sustain 
capabilities. Existing reporting mechanisms, such as the State 
Preparedness Report (SPR), can then be used to communicate progress 
toward achieving capability targets and to inform assessments such as 
the National Preparedness Report. Taken together, the THIRA results and 
the SPR will identify capability needs. These products will allow the 
Nation to look holistically across all capabilities and whole community 
partners to gauge areas of strength and areas for improvement. FEMA 
reports the results of the capability assessments annually in the 
National Preparedness Report.
  evolving the grant program: the national preparedness grant program
    Federal investments in State, local, and Tribal preparedness 
capabilities have contributed to the development of a significant 
National-level capacity to prevent, protect against, respond to, and 
recover from disasters of all kinds. As we look ahead, to address 
evolving threats and make the most of limited resources, in the fiscal 
year 2013 budget administration proposes to reform the grant programs 
and establish a National Preparedness Grant Program (NPGP) to focus on 
building and sustaining core capabilities associated with the five 
mission areas within the NPG that are readily deployable and cross-
jurisdictional, helping to elevate Nation-wide preparedness.
    The proposed NPGP would consolidate current State and local 
preparedness grant programs into one overarching program (excluding 
Emergency Management Performance Grants and fire grants) to enable 
grantees to build and sustain core capabilities outlined in the NPG 
collaboratively. As a single, comprehensive grant program, the NPGP 
would eliminate the redundancies and requirements placed on both the 
Federal Government and the grantees resulting from the current system 
of multiple individual, and often disconnected, grant programs. By 
removing stovepipes, encouraging collaboration among disciplines and 
across levels of government, State and local governments would be able 
to collectively prioritize their needs and allocate increasingly scarce 
grant dollars where they would have the greatest impact.
    The NPGP would prioritize the development and sustainment of core 
capabilities as outlined in the National Preparedness Goal. Particular 
emphasis would be placed on building and sustaining capabilities that 
address high-consequence events that pose the greatest risk to the 
security and resilience of the United States and could be utilized to 
address multiple threats and hazards. The NPGP would use a 
comprehensive process for assessing regional and National capability 
gaps through the THIRA process to prioritize and invest in key 
deployable capabilities.
    The NPGP would draw upon and strengthen existing grants processes, 
procedures, and structures, emphasizing the need for greater 
collaboration and unity among Federal, State, local, and Tribal 
partners. This is particularly important as they work together to make 
smarter investment decisions, develop deployable capabilities, and 
share resources through Emergency Management Assistance Compacts (EMAC) 
or other mutual aid/assistance agreements. In many ways, the NPGP 
structure mirrors the collaboration and decision-making process that 
occurs during disasters, when various stakeholders and jurisdictions 
come together to plan, build, and execute capabilities together.
    Under the proposed NPGP, grantees would be required to match their 
proposed investments to core capabilities, incorporate effectiveness 
measures, and regularly report progress on the acquisition and 
development of identified capabilities. These measures would enable all 
levels of government to collectively demonstrate how the proposed 
investment would build and sustain core capabilities necessary to 
strengthen the Nation's preparedness.
    Thank you for the opportunity to discuss these important issues 
before the subcommittee. I am happy to respond to any questions you may 
have.

    Mrs. Brooks. Thank you, Mr. Manning.
    The Chairwoman now recognizes Ms. Richards for 5 minutes 
for an opening statement.

STATEMENT OF ANNE L. RICHARDS, ASSISTANT INSPECTOR GENERAL FOR 
    AUDITS, OFFICE OF INSPECTOR GENERAL, U.S. DEPARTMENT OF 
                       HOMELAND SECURITY

    Ms. Richards. Good morning, Chairman Brooks, Ranking Member 
Payne, Ranking Member Thompson, and Members of the 
subcommittee. Thank you for inviting me to testify today on the 
Homeland Security Grant Program.
    Homeland security grants are awarded to States, 
territories, local, and Tribal governments to enhance their 
ability to prepare for, prevent, respond to, and recover from 
terrorist attacks, major disasters, and other emergencies. The 
program, administered by FEMA, includes several grant programs, 
such as the State Homeland Security Program and the Urban Areas 
Security Initiative, that funds a range of preparedness 
activities.
    As of today, we have completed audits on 34 States and 
their urban areas and one territory, to examine how they manage 
these grants' funds. I am happy to report that States generally 
comply with applicable laws and regulations in distributing and 
spending their awards.
    However, the States face some challenges related to their 
homeland security strategies: Obligation of grant funds, 
reimbursement to sub-grantees for expenditures and monitoring 
of sub-grantees' performance. Our audits show that the goals 
and objectives in many State homeland security strategies were 
too general to effectively measure performance and progress 
toward improving their capabilities.
    In addition, many strategies were outdated and, thus, did 
not reflect current priorities, risks, needs, and capabilities. 
Our audits have also shown that States did not always obligate 
homeland security grants to sub-grantees promptly, which could 
have led to increases in sub-grantees' administrative costs, 
hampering completion of projects and delivery of equipment and 
training, thus putting preparedness and response capabilities 
at risk.
    Some States also did not reimburse sub-grantees for their 
grant expenditures in a timely manner. Many homeland security 
grantees did not adequately oversee sub-grantees' performance 
or measure their progress toward achieving objectives and 
goals. Without sufficient oversight, States cannot ensure 
effective and efficient use of funds to enhance capabilities.
    We also noted that FEMA did not require States to report 
progress in achieving milestones as part of the annual 
application process. This is troubling, as many projects 
require several years to complete. It is difficult to make wise 
investment decisions without accurate information about the 
current status and progress of long-term projects.
    FEMA has agreed to add this requirement to the fiscal year 
2013 application process.
    In some of our audits, we identified sub-grantees that did 
not fully comply with Federal procurement regulations. For 
example, in fiscal year 2012, we identified sub-grantees that 
did not obtain an adequate number of bids or properly justify 
sole-source procurements. Some States did not conduct required 
cost analyses.
    As a result, States cannot always be assured that sub-
grantees are making fully informed decisions on contract awards 
or selecting the best possible vendors.
    In January 2012, we issued a report on the U.S. Virgin 
Islands' management of homeland security grants from fiscal 
year 2007 through 2009. Based on our audit work, we questioned 
nearly $1.3 million in claimed costs, and were concerned about 
the territory's ability to support the entire $3.4 million 
expended.
    For these reasons, we recommended that FEMA consider 
classifying the territory as a high-risk grantee. FEMA 
concurred with all 22 of our recommendations.
    In February 2013, we issued an audit report providing 
recommendations on ways FEMA could improve its risk-based 
monitoring of grantees. Although FEMA's fiscal year 2013 plan 
included improvements over its fiscal year 2012 practices, its 
plan did not ensure that all grantees with increased risk would 
be properly selected for financial monitoring.
    In closing, I would like to note FEMA's efforts over the 
past several years to improve homeland security grants 
management, and its plans to continue these efforts by updating 
program guidance and better monitoring grantees.
    Since 2007, FEMA has concurred with, taken steps to 
implement, or implemented almost all of our recommendations to 
improve the management of homeland security grants. For our 
part, we are currently conducting 15 audits of homeland 
security grants. By August 2014, we will have completed audits 
of all States and territories receiving these grants.
    Our overall objective in these audits remain essentially 
unchanged, to continue recommending actions that will make 
grant management more effective and efficient, while 
strengthening the Nation's ability to prepare for, respond to, 
and recover from natural and man-made disasters.
    Ms. Chairman, this concludes my prepared remarks. I welcome 
any questions that you or the subcommittee Members may have.
    [The prepared statement of Ms. Richards follows:]
                 Prepared Statement of Anne L. Richards
    Good morning Chairman Brooks, Ranking Member Payne, and Members of 
the subcommittee: I am Anne Richards, assistant inspector general for 
audits at the Department of Homeland Security (DHS) Office of Inspector 
General (OIG). Thank you for inviting me to testify today on the 
Homeland Security Grant Program (HSGP).
    HSGP provides funds to State, territory, local, and Tribal 
governments to enhance their ability to prepare for, prevent, protect, 
respond to, and recover from terrorist attacks, major disasters, and 
other emergencies. Within DHS, the Federal Emergency Management Agency 
(FEMA) administers HSGP, which is an important part of the 
administration's larger, coordinated effort to strengthen homeland 
security preparedness. The program includes several interrelated 
Federal grant programs that fund a range of preparedness activities, 
including planning, organization, equipment purchase, training, and 
exercises, as well as management and administration. Under HSGP, the 
State Homeland Security Program (SHSP) provides financial assistance to 
States and U.S. territories for these activities, and the Urban Areas 
Security Initiative (UASI) provides funding to high-risk urban areas 
for the same types of activities.
    Since 2007, DHS OIG has audited States and urban areas to determine 
whether they have implemented their HSGP grants efficiently and 
effectively, achieved program goals, and spent funds according to grant 
requirements. In fiscal year 2012, we completed audits of 13 States, 1 
territory, and 2 urban areas: Arizona, Arkansas, Colorado, Florida, 
Georgia, Kansas, Louisiana, Michigan, Minnesota, Montana, New Mexico, 
Ohio, Oklahoma, U.S. Virgin Islands, Utah (urban area only), and 
Washington (urban area only). In total, as of March 2013, we have 
completed audits on HSGP grant management in 34 States and 1 territory 
(U.S. Virgin Islands), some of which included urban areas; we have 15 
on-going audits.
    Through our audits, we determined that the States complied with 
applicable laws and regulations in distributing and spending their 
awards. However, we noted several challenges related to the States' 
homeland security strategies, obligation of grants, reimbursement to 
subgrantees for expenditures, monitoring of subgrantees' performance 
and financial management, procurement, and property management.
                      homeland security strategies
    Many States' homeland security strategies did not include specific 
goals and objectives and were outdated. According to DHS guidance, 
States that receive HSGP grants are to create and use strategies aimed 
at improving preparedness and response to natural and manmade 
disasters. The goals and objectives in these strategies should be 
specific, measurable, achievable, results-oriented, and time-limited. 
However, the goals and objectives in many strategies were too general 
for States to use to effectively measure their performance and progress 
toward improving preparedness and response capabilities. In addition, 
because some States did not update their strategies, they did not 
reflect the most current priorities, risks, needs, and capabilities. 
Using outdated strategies can also hamper decision-making on future 
expenditures.
    In our audits completed in fiscal year 2012, we noted that the 
homeland security strategies for Arkansas, Florida, Georgia, Kansas, 
Louisiana, Minnesota, Montana, New Mexico, U.S. Virgin Islands, and 
Washington did not include some or all of the elements necessary for a 
successful strategy, such as specific, measurable, achievable, results-
oriented, and time-limited goals and objectives.
    Minnesota and New Mexico also had outdated strategies. For example, 
Minnesota's homeland security strategy was last updated January 18, 
2008, but referred to a comprehensive risk, capabilities, and needs 
assessment completed in October 2003. According to the strategy, a 
needs assessment was to have been updated in 2006, but it had not been. 
New Mexico developed a 3-Year Domestic Preparedness Strategy in January 
2003 that did not contain current and specific goals, objectives, and 
performance measurements and was never updated. FEMA requested an 
update in fiscal year 2005, and New Mexico developed a draft, but it 
was never approved.
                       obligation of grant funds
    Our audits also showed that States did not always obligate HSGP 
grants to subgrantees in a timely manner. In many cases, it took months 
for State grantees to obligate grant funds. By not obligating funds 
promptly, grantees may have increased subgrantees' administrative 
costs. They may have also hindered the subgrantees' ability to complete 
projects and deliver needed equipment and training, which could 
ultimately put preparedness and response capabilities at risk. In 
addition, some State grantees did not promptly reimburse subgrantees 
for their grant expenditures.
    In 2012, we found that Arkansas, Florida, and Georgia did not 
obligate funds to their subgrantees in a timely manner. In Arkansas, 
there was a lapse of 137 to 1,031 days between required obligation and 
availability of funds during fiscal years 2008 to 2010. Florida had 
some instances during fiscal years 2007 and 2008 in which funds were 
obligated more than 400 days after the award date, and in fiscal year 
2009, the State obligated funds from 44 to 101 days late. Georgia did 
not make funds available for expenditure to subgrantees until as many 
as 261 days after the required date. Additionally, in fiscal year 2009, 
Florida did not adequately calculate and award SHSP funds designated 
for local jurisdictions. Rather than following FEMA program guidance to 
separately obligate at least 80 percent of SHSP and UASI funds within 
45 days of receipt, Florida combined the funds, and from the total, 
allocated 80 percent to local jurisdictions. This method resulted in 
less than 80 percent of the SHSP award being obligated to local 
recipients. The difference equated to approximately $2.9 million that 
local jurisdictions could have used to complete critical projects.
    During fiscal years 2008 through 2009, New Mexico withheld $2.5 
million in SHSP grant funds from local units of government to provide 
training and exercises. By withholding a portion of the grant funds, 
the State obligated less than the required amount to local units.
    In fiscal year 2007, 24 subgrantees and 4 State agencies we visited 
in Ohio did not receive grant awards until an average of 8 months after 
the State obligated the grant funds. For fiscal year 2008, delays 
increased to an average of 10 months (between 6 and 30 months); for 
fiscal year 2009, they increased to an average of 11 months. Four 
subgrantees did not receive fiscal year 2009 grant awards by May 15, 
2011--19 months after Ohio reported to FEMA that these funds were 
obligated. Eighteen of the 28 grant recipients requested an extension 
to the grant performance period because they needed more time to 
complete planned procurements and obtain reimbursements.
    Ohio did not always make payments to subgrantees for grant 
expenditures in a timely manner. A sample of 55 payment requests showed 
payments were made anywhere from 13 to 89 days after the requests were 
submitted to the State. As a result, local funds were often not 
reimbursed in a timely manner and vendors were not always paid timely 
for goods and services.
  monitoring of subgrantees' performance and financial and management
    Many HSGP grantees did not adequately oversee subgrantees' 
performance or measure their progress toward achieving objectives and 
goals, nor did they always adequately monitor subgrantees' financial 
management of grants. Inadequate assessment of subgrantees' performance 
and progress may have limited the States' ability to assess 
capabilities and gaps and take corrective actions to improve them. 
Without performance monitoring, States cannot be certain that they have 
met program goals and used funds to enhance capabilities, rather than 
wasting them by not addressing deficiencies. The States also could not 
ensure that subgrantees' funding requests were aligned with real 
threats and vulnerabilities. By not adequately overseeing subgrantees' 
financial management practices, States may not have been fully 
knowledgeable about the subgrantees' financial status. Further, the 
States could not ensure that subgrantees were using funds efficiently 
and effectively and complying with Federal and State regulations in 
administering grants.
    In our fiscal year 2012 audits, we determined that nine States 
needed to improve their monitoring of grant performance and 
subgrantees' adherence to Federal and State regulations because they 
did not have procedures to ensure that subgrantees consistently tracked 
what they accomplished with grant funds, did not always ensure 
compliance with Federal laws and regulations, or had limited oversight. 
Fiscal year 2012 audits also showed that States needed to improve their 
financial management practices, performance and financial reporting, 
transfer of grant funds, management and administrative costs, or grant 
expenditure reviews.
    Arizona and New Mexico did not have procedures to track grant 
performance. Arizona did not ensure that subgrantees prepared After-
Action Reports and Improvement Plans, which are critical to documenting 
weaknesses identified by exercises and to track corrective actions. New 
Mexico did not have a system, process, or qualified personnel to track 
accomplishments resulting from grant funds. Personnel were not trained 
on measuring improvement in preparedness, and the State had not hired 
additional personnel to address this function.
    Washington had not implemented an assessment process to measure 
improvements in preparedness. Each year, the State reassessed its 
priorities without considering improvement in performance and 
attainment of objectives in prior years. It had not fully used FEMA's 
Target Capabilities List to measure improvements and identify gaps.
    Arkansas monitored subgrantees through desk reviews of budgets, 
payments, an inventory database, and After-Action Reports, which did 
not always ensure subgrantee compliance with Federal laws and 
requirements. No subgrantee reviews were conducted during fiscal years 
2008 through 2010. Consequently, some grant funds were being used for 
other than the intended purposes.
    Colorado's guidance to subgrantees did not provide sufficient grant 
administration information or program support to ensure compliance with 
Federal requirements. With the exception of activities such as grant 
reimbursement requests and modification procedures, Colorado's written 
guidance did not adequately describe its expectations, methodologies, 
or functional administration requirements. Also, its guidance did not 
address requirements to ensure segregation of duties, nor did it 
suggest methods to accomplish such segregation.
    Louisiana did not have adequate oversight to ensure that 
subgrantees complied with all Federal requirements. Louisiana's 
monitoring processes were not sufficient to identify subgrantees' non-
compliance with Federal financial and equipment-related requirements. 
Of the 17 subgrantee financial records reviewed, five did not include 
required information such as records of expenditures, obligations, 
unobligated balances, and liabilities. In addition, the New Orleans 
urban area did not have a regional multi-year training and exercise 
plan, but instead relied on a University of New Orleans consortium to 
develop a plan. However, the consortium was abolished in 2009 because 
of budget shortfalls. In December 2010, Texas A&M University selected 
New Orleans as a pilot site for its Training Needs Assistance Project, 
which should result in a fully developed multi-year training plan.
    Minnesota did not adequately monitor subgrantee activities for 
fiscal years 2007 through 2009. Its monitoring was limited, and the 
State did not have subgrantee program performance monitoring policies 
and procedures until December 31, 2009.
    Montana had minimal oversight through periodic contact with 
subgrantee staff, review of subgrantee grant applications, and 
processing of reimbursement requests. According to State officials, 
subgrantee site visits were not made during the grant years reviewed. 
There were other weaknesses in the State-required subgrantee progress 
reports that described the activities, difficulties, and use of funding 
during the period. For example, Montana's fiscal year 2007 
interoperability investment justification requested $3.7 million to 
meet five milestones; however, the progress reports for this grant did 
not indicate how well the funds were being spent, nor did the reports 
discuss the progress toward meeting particular milestones. Therefore, 
Montana funded activities without knowing the extent that prior funds 
had on the subgrantee's ability to meet specific program goals.
    Oklahoma did not adequately document and analyze performance data 
related to accomplishing its homeland security strategy goals and 
objectives. The State did not always collect information on the 
progress of on-going projects and did not always document progress in a 
manner that facilitated on-going analysis and review.
    In fiscal year 2012, our audits also showed that the States needed 
to improve their financial management practices, performance and 
financial reporting, transfer of grant funds, monitoring of management 
and administrative costs, and grant expenditure reviews.
    Montana did not comply with Federal grant financial management 
requirements. The State had incomplete subgrantee file information for 
award letters and supporting documentation for reimbursement requests. 
In addition, the State Administrative Agency did not adequately 
cooperate with the supporting administrative office responsible for 
paying subgrantee invoices. Montana had missing grant award letters 
totaling $477,000 out of $3.4 million in awards selected for testing, 
had difficulty reconciling subgrantee award amounts with expenditures, 
and did not have supporting documentation for subgrantee reimbursement 
requests totaling $938,601. Because the State Administrative Agency did 
not manage all its grants to subgrantees, it could not determine the 
actual status of SHSP grant funding.
    In New Mexico, one subgrantee paid funds to a vendor for a data 
management system upgrade and related equipment before it received the 
services and equipment. The subgrantee advanced a total of $99,250, or 
63 percent of the total contract price of $157,620. New Mexico 
reimbursed the subgrantee for the amount advanced to this vendor; 
however, as of the date of our audit testing, the upgrades and 
equipment had not been received. We questioned the $99,250 that the 
subgrantee advanced.
    Minnesota subgrantees did not submit timely State-required 
quarterly financial status reports and did not always submit State-
required quarterly progress reports. Minnesota relied on subgrantee 
financial and progress information to generate the State-wide financial 
status documents and determine the progress being made in using grant 
funds. Yet, five financial status reports exceeded the quarterly 
reporting requirement, with one report covering 28 months. In addition, 
5 of the 22 subgrantees we visited did not submit progress reports from 
October 1, 2007, through June 30, 2010. For example, one subgrantee 
received $1.69 million of grant funds in fiscal year 2007 and had spent 
$1.687 million by June 30, 2010, but in that time it had not submitted 
any progress reports.
    New Mexico did not submit timely and accurate Biannual Strategy 
Implementation Reports and Financial Status Reports to FEMA. Of the 12 
Biannual Strategy Implementation Reports submitted, 11 were submitted 
24 to 1,003 days late, and the amounts included in these reports were 
not accurate. Additionally, 8 of 27 Financial Status Reports were 
submitted late.
    In fiscal years 2009 and 2010, Utah changed the scope of several 
projects by transferring approximately $2.3 million in UASI grant funds 
between projects without prior approval from FEMA. Although the grant 
guidelines allowed these types of expenditures, FEMA should have 
ensured that the State Administrative Agency submitted budget change 
requests for all funding transfers between projects. This would help to 
ensure that items purchased did not exceed approved amounts and were 
allowable under the grant guidelines.
    Kansas and New Mexico did not identify and validate management and 
administrative costs in accordance with Federal and State requirements. 
A Kansas fiscal agent representing six of the seven homeland security 
regions could not provide supporting documentation for any of the 
$197,532 in management and administrative costs submitted to and 
reimbursed by the State from fiscal year 2008 through October 2011. 
Kansas decided to reimburse the fiscal agent for the maximum allowable 
amount of management and administrative costs without requiring support 
for these costs.
    New Mexico allocated $195,735 as management and administrative 
costs in fiscal year 2009, which was the 3 percent maximum allowed to 
the State. However, the State did not provide detailed costs for the 
$195,735 and spread the amount among various budget line items without 
sufficient supporting documentation.
    Minnesota did not have written policies and procedures to guide its 
financial review and did not always have documentation to support 
reimbursement approvals. As a result, the State could not ensure that 
grant expenditures were allowable, allocable, authorized, and in 
accordance with grant requirements. In two instances, approved 
reimbursement requests did not include invoices: (1) $392,000 for hand-
held digital portable radios, and (2) $64,000 for a wireless X-ray 
system. Even though invoices were subsequently obtained from the 
subgrantees, the State Administrative Agency should not have approved 
the reimbursements without the appropriate documentation.
                compliance with procurement regulations
    In some audits that we conducted since 2007, we identified 
subgrantees that did not fully comply with Federal and State 
procurement regulations. For example, in our fiscal year 2012 audits, 
we identified subgrantees that did not comply with Federal regulations 
because they did not obtain an adequate number of bids, did not 
properly justify sole-source procurements, or did not conduct a cost 
analysis as required for a non-competitive procurement. As a result, 
the States could not always be assured that subgrantees made fully 
informed decisions on contract awards, and that they had selected the 
best offerors.
    In Arkansas, 14 of 18 subgrantees did not: (1) Obtain an adequate 
number of qualified quotes or formal bids, (2) conduct a cost analysis, 
or (3) justify sole-source procurements. Of the 114 reviewed 
transactions, we questioned more than $1.2 million in 63 transactions 
for issues related to rate quotes, cost analysis, sole-source 
justifications, and formal bidding.
    Georgia and some of its subgrantees did not follow Federal 
regulations for equipment and services procured using grant funds. For 
example, a subgrantee awarded a noncompetitive contract for $2.2 
million to purchase communications equipment without a sole-source 
justification. In another example, a contractor awarded a subcontract 
for $450,000 to a local university to update an inventory of food 
systems within the State, also without a sole-source justification for 
awarding a noncompetitive subcontract. Although both the contractor and 
subcontractor were State entities and therefore exempt from Federal 
competitive bidding requirements, Georgia law requires competitive 
bidding for this particular procurement.
    Ohio did not ensure that subgrantees followed Federal regulations 
for equipment and services procured with HSGP funds. Although other 
sources were available, Ohio made 76 noncompetitive procurements of the 
85 procurements reviewed. Subgrantees did not prepare cost or price 
analyses for any of the procurements. Five of the 76 noncompetitive 
procurements from Ohio were specifically identified as sole-source by 
the purchasing agent, and local procedures were followed to obtain 
approval.
    Also in Ohio, 55 purchases from suppliers on its State Term 
Schedules may have met Ohio competition requirements; however, these 
purchases did not meet Federal procurement standards for fair and open 
competition for purchases in excess of $100,000. State Term Schedules 
are lists prepared and maintained by the Ohio Department of 
Administrative Services of approved manufacturers with products offered 
at ``best prices'' and specific State-required terms. Competition is 
not part of the process for suppliers to be placed on the State Term 
Schedules. Federal regulations require that all prequalified lists of 
persons, firms, or products that are used in acquiring goods and 
services be current and include enough qualified sources to ensure 
maximum open and free competition. The items on the State Term website 
are not necessarily the best value, but rather are a list of suppliers 
that have qualified their products for the State Term Schedules.
                          property management
    During our audits, when conducting our on-site visits, we 
identified weaknesses in property management. Not all subgrantees were 
regularly inventorying grant-funded equipment. In addition, subgrantees 
did not always maintain accurate, complete, and up-to-date property 
records; did not always include required details in inventory 
documentation; and did not always properly mark grant-funded equipment 
as required by DHS. Without adequate property management, States and 
subgrantees may not be able to make certain that they have the 
necessary equipment, make well-informed decisions on future equipment 
needs, and prevent duplicative purchases. Proper inventory practices 
also help safeguard against loss, damage, and theft. Of the 16 States 
we audited in fiscal year 2012, six had property management weaknesses, 
including physical inventories that had not been completed and 
inaccurate, incomplete, and missing property records. One State did not 
enforce the requirement for subgrantees to establish and maintain 
effective control and accountability systems.
    One subgrantee in Colorado did not properly mark equipment 
purchased with grant funds, did not enter some items on the inventory 
control sheet, and did not follow-up with subrecipients to ensure that 
they had received equipment. Another subgrantee had difficulty 
providing an equipment list that correlated to our fiscal years 2007-
2009 grant review period. At another location, listed property was 
assigned to individuals who did not have custody of the property. One 
subgrantee did not maintain an equipment list.
    In Louisiana, 7 of 16 subgrantees' equipment property records did 
not include pertinent information such as acquisition dates, serial 
numbers, cost, or location.
    Montana subgrantees did not always maintain property management 
records in accordance with Federal requirements. Property record 
requirements were not being followed at 14 of 22 subgrantees.
    Oklahoma and Utah did not ensure that equipment purchased with 
grant funds was properly identified as such to help deter theft or 
unauthorized use. In Oklahoma, 9 of 28 locations had various items such 
as interoperable equipment, emergency response vehicles, and 
surveillance cameras not labeled as purchased with grant funds. In 
Utah, none of the items reviewed was marked.
    Minnesota did not enforce the requirement that subgrantees 
establish and maintain effective control and accountability systems to: 
(1) Safeguard property procured with HSGP grant funds, or (2) provide 
assurances that the property was used solely for authorized purposes.
               u.s. virgin islands as a high-risk grantee
    In January 2012, we issued The U.S. Virgin Islands Management of 
State Homeland Security Program Grants Awarded During Fiscal Years 2007 
Through 2009. This audit, conducted by Foxx & Company, included a 
review of approximately $4.6 million in SHSP grants awarded to the U.S. 
Virgin Islands during fiscal years 2007 through 2009. We determined 
that the U.S. Virgin Islands did not efficiently and effectively 
administer its grant program according to guidance and regulations. We 
identified eight areas for improvement: Strategic goals and objectives, 
sole-source procurement and management of contract deliverables, 
financial management documentation, property management controls and 
accountability, use of purchased equipment, procurement of training, 
personnel time charges, and filing of financial reports. As a result of 
these issues, we questioned nearly $1.3 million in claimed costs for 
specific items. Furthermore, we considered the entire $3.4 million in 
funding granted to the U.S. Virgin Islands in fiscal years 2007 through 
2009 as potential questioned costs until the territory could provide 
adequate support for the funds. Because of the numerous problems we 
noted in our audit, we determined that FEMA should consider classifying 
the U.S. Virgin Islands as a high-risk grantee. FEMA concurred with our 
22 recommendations for improvements which, if implemented, would help 
strengthen program management, performance, and oversight.
                    fema monitoring of hsgp grantees
    As a result of our audits, we have recommended that FEMA work with 
the States to improve HGSP management. FEMA concurred with almost all 
of our recommendations and has either coordinated with the State 
Administrative Agencies to implement them or taken steps to implement 
them. Although we audited the States' management of HSGP awards rather 
than FEMA's program management, we noted that FEMA could strengthen 
HSGP by issuing better guidance to the States on strategic planning, 
which would in turn improve the States' performance measurement and 
progress toward achieving their goals and objectives. For example, in 
our February 2013 report, Kentucky's Management of State Homeland 
Security Program and Urban Areas Security Initiative Grants Awarded 
Fiscal Years 2008-2010, we recommended that FEMA issue guidance to HSGP 
grantees to periodically update strategic plans and include goals that 
align with current National Preparedness Guidelines. According to 
officials in FEMA's Grant Programs Directorate, the National 
Preparedness Directorate was expected to issue updated guidance in the 
summer of 2013.
    In the past, FEMA has had challenges monitoring its grant programs. 
Specifically, the component's financial and programmatic monitoring 
plans did not ensure that it could properly monitor all grantees with 
increased risk. However, FEMA has taken steps to improve its grant 
monitoring process by issuing a comprehensive and integrated risk-based 
monitoring plan.\1\ As we noted in our February 2013 report, FEMA's Use 
of Risk-based Monitoring for Grantee Oversight, FEMA's plans from the 
prior fiscal year did not specify using risk indicators to select 
grantees to monitor. Instead, the component relied on legislative 
mandates, random sampling, and subjective judgment to select grantees. 
Although the fiscal year 2013 financial and programmatic monitoring 
plan covers all of FEMA's grants, the component still plans to select 
random samples of grants for financial monitoring. For HSGP, FEMA plans 
to pilot joint financial and programmatic monitoring of the maximum 
number of awards, given resource constraints and monitoring needs. At 
the end of fiscal year 2013, FEMA will assess the outcome of this 
effort and consider expansion of joint monitoring of HSGP awards.
---------------------------------------------------------------------------
    \1\ Fiscal Year 2013 FEMA Monitoring Plan, October 2012.
---------------------------------------------------------------------------
    In our February 2013 report on monitoring, we made recommendations 
related to risk-based selection of grantees for financial monitoring 
and coordination of monitoring plans. FEMA needs to ensure that all 
grantees with increased risk are properly selected for financial 
monitoring and will be appropriately monitored. In addition, FEMA 
should communicate regularly with DHS to ensure consistency in 
monitoring plans. Without coordination, the component might issue new 
plans that are inconsistent with the DHS risk model and thus, need to 
be revised.
                             auditing plans
    We are currently conducting 15 HSGP audits, and we plan to complete 
audits of all States and territories receiving HSGP grants by August 
2014. Our overall objective in these audits remains essentially 
unchanged--to continue recommending actions that will make grants 
management more efficient and effective, while strengthening the 
Nation's ability to prepare for and respond to natural and man-made 
disasters.
    Ms. Chairman, this concludes my prepared remarks. I welcome any 
questions that you or the Members of the subcommittee may have.

    Mrs. Brooks. Thank you, Ms. Richards.
    The Chairwoman now recognizes Mr. Maurer for 5 minutes for 
an opening statement.

 STATEMENT OF DAVID C. MAURER, DIRECTOR, HOMELAND SECURITY AND 
        JUSTICE ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE

    Mr. Maurer. Good morning, Chairman Brooks, Ranking Member 
Payne, Ranking Member Thompson, and other Members and staff. I 
am pleased to be here today to discuss FEMA's on-going efforts 
to improve how it manages grant programs and assesses our 
preparedness for natural and man-made disasters.
    Over the past decade, Congress has appropriated $39 billion 
for a variety of grant programs designed to help the Nation be 
better prepared for terrorist attacks and disasters. GAO has 
been there providing objective, nonpartisan oversight.
    What we have found has often been not encouraging. DHS, and 
more specifically FEMA, has struggled to effectively manage and 
measure grant programs. It is difficult to say what we have 
really gotten for our $39 billion investment because FEMA has 
been unable to measure how grant funding has enhanced our 
National ability to be prepared.
    Our work has found that FEMA lacks measures to assess how 
well its individual grant programs are working, and whether 
collectively these programs have helped enhance National 
preparedness.
    It comes down to knowing how prepared we are and how 
prepared we should be. Since FEMA has been unable to assess how 
prepared we are and how prepared we should be, it also lacks a 
clear goal--a clear view, rather--of where we have preparedness 
gaps. That makes it very difficult to direct grant money to 
address those gaps.
    Now I need to be clear. It is difficult to measure 
preparedness. FEMA has been working on this for years. It is 
important to give them credit for what they have been able to 
accomplish over the course of the last 18 months.
    FEMA now has the basic elements in place for assessing 
National preparedness capabilities. It has articulated a 
National goal, developed a plan for achieving that goal, issued 
its first National report on progress, and has enhanced the 
consideration of risk in funding decisions.
    These steps are vital. They make progress toward addressing 
GAO recommendations. However, FEMA continues to face important 
challenges. Most significantly, FEMA still lacks clear, 
objective, and quantifiable measures of how prepared the Nation 
is, and how prepared we should be.
    That means FEMA is not yet in a position to target grant 
funding toward the most critical capability gaps. FEMA also 
continues to lack measures to gauge the performance of the 
programs it has funded. That means the Nation has little way of 
knowing the extent to which the billions spent on these 
programs have been successful.
    I would like to briefly mention another significant problem 
in FEMA's management, the risk of duplication. Last February, 
we issued a report looking at four of the largest FEMA 
programs. We found significant overlap among grant recipients, 
goals, and locations.
    A single jurisdiction can apply for funds for the same 
project from all four programs. FEMA may not know, because it 
makes award decisions with different levels of information.
    For some grant programs, FEMA literally does not know 
exactly what the grant money will fund. In addition, FEMA lacks 
internal coordination across its programs to compare notes on 
what grant recipients are requesting and what FEMA's various 
internal units have decided to fund.
    Since our report, FEMA has taken actions to address our 
findings. Most significantly, in the fiscal year 2013 budget, 
FEMA proposed consolidating most of its grant programs into a 
single program. However, it was not clear from the proposal 
whether this would, in fact, address our recommendations.
    As a practical matter, Congress has not accepted this idea 
with open arms.
    FEMA is also in the process of updating its data systems 
and enhancing its internal administration of grant programs to 
reduce the risk of duplication.
    In conclusion, there is no doubt FEMA is trying to do 
things that are very difficult. But they need to do them. The 
law requires it. The President requires it. Stacks of GAO 
reports have recommended it.
    Billions of taxpayer dollars are being invested in making 
the Nation better prepared for a terrorist attack and natural 
disaster. After years of effort, FEMA still does not have a 
clear and objective, quantifiable way to know what has been 
accomplished with the money spent to date, what still needs to 
be done, and the resulting gaps.
    This is vital for ensuring that, in the future, 
increasingly scarce grant funding is focused on closing those 
gaps.
    Chairman Brooks, thank you for the opportunity to testify 
this morning. I look forward to your questions.
    [The prepared statement of Mr. Maurer follows:]
                 Prepared Statement of David C. Maurer
                             March 19, 2013
                             gao highlights
    Highlights of GAO-13-456T, a testimony before the Subcommittee on 
Emergency Preparedness, Response, and Communications, Committee on 
Homeland Security, House of Representatives.
Why GAO Did This Study
    From fiscal years 2002 through 2012, the Congress appropriated 
about $39 billion to a variety of DHS preparedness grant programs to 
enhance the capabilities of State and local governments to prevent, 
protect against, respond to, and recover from terrorist attacks and 
other disasters. DHS allocated more than $21.3 billion through four of 
the largest preparedness programs--the Port Security Grant Program, the 
State Homeland Security Program, the Transit Security Grant Program, 
and the Urban Areas Security Initiative.
    In February 2012, GAO identified factors that contribute to the 
risk of FEMA potentially funding unnecessarily duplicative projects 
across the four grant programs. In March 2011, GAO reported that FEMA 
has faced challenges in developing and implementing a National 
preparedness assessment, which inhibits its abilities to effectively 
prioritize preparedness grant funding. This testimony updates GAO's 
prior work and describes DHS's and FEMA's progress over the past year 
in: (1) Managing preparedness grants, and (2) measuring National 
preparedness by assessing capabilities. This statement is based on 
prior products GAO issued from March 2011 to February 2012 and selected 
updates in March 2013. To conduct the updates, GAO analyzed agency 
documents and interviewed FEMA officials.
What GAO Recommends
    GAO has made recommendations to DHS and FEMA in prior reports. DHS 
and FEMA concurred with these recommendations and have actions underway 
to address them.
   national preparedness.--fema has made progress in improving grant 
      management and assessing capabilities, but challenges remain
What GAO Found
    Officials in the Federal Emergency Management Agency (FEMA)--a 
component of the Department of Homeland Security (DHS)--have identified 
actions they believe will enhance management of the four preparedness 
programs GAO analyzed; however, FEMA still faces challenges. In 
February 2012, GAO found that FEMA lacked a process to coordinate 
application reviews and made award decisions with differing levels of 
information. To better identify potential unnecessary duplication, GAO 
recommended that FEMA collect project-level information and enhance 
internal coordination and administration of the programs. DHS 
concurred. The fiscal year 2013 President's budget, proposed the 
establishment of the National Preparedness Grant Program (NPGP), a 
consolidation of 16 FEMA grant programs into a single program. However, 
Members of Congress raised concerns about the NPGP and have not 
approved the proposal. As a result, FEMA officials reported that the 
agency was drafting new guidance for the execution of the NPGP based on 
pending Congressional direction on fiscal year 2013 appropriations. If 
approved, and depending on its final form and execution, the NPGP could 
help mitigate the potential for unnecessary duplication and address 
GAO's recommendation to improve internal coordination. In March 2013, 
FEMA officials reported that FEMA intends to start collecting and 
analyzing project-level data from grantees in fiscal year 2014; but has 
not yet finalized data requirements or fully implemented the data 
system to collect the information. Collecting appropriate data and 
implementing project-level enhancements as planned would address GAO's 
recommendation and better position FEMA to identify potentially 
unnecessary duplication.
    FEMA has made progress addressing GAO's March 2011 recommendation 
that it develop a National preparedness assessment with clear, 
objective, and quantifiable capability requirements and performance 
measures; but continues to face challenges developing a National 
preparedness system that could assist FEMA in prioritizing preparedness 
grant funding. For example, in March 2012, FEMA issued the first 
National Preparedness Report, which describes progress made to build, 
sustain, and deliver capabilities. FEMA also has efforts underway to 
assess regional, State, and local preparedness capabilities. In April 
2012, FEMA issued guidance on developing Threat and Hazard 
Identification and Risk Assessments (THIRA) to self-assess regional, 
State, and local capabilities and required States and local areas 
receiving homeland security funds to complete a THIRA by December 2012. 
However, FEMA faces challenges that may reduce the usefulness of these 
efforts. For example, the National Preparedness Report notes that while 
many programs exist to build and sustain preparedness capabilities, 
challenges remain in measuring progress over time. According to the 
report, in many cases, measures do not yet exist to gauge performance, 
either quantitatively or qualitatively. Further, while FEMA officials 
stated that the THIRA process is intended to develop a set of National 
capability performance requirements and measures, such requirements and 
measures have not yet been developed. Until FEMA develops clear, 
objective, and quantifiable capability requirements and performance 
measures, it is unclear what capability gaps currently exist and what 
level of Federal resources will be needed to close such gaps. GAO will 
continue to monitor FEMA's efforts to develop capability requirements 
and performance measures.
    Chairman Brooks, Ranking Member Payne, and Members of the 
subcommittee: I appreciate the opportunity to participate in today's 
hearing to provide an update on the efforts of the Federal Emergency 
Management Agency (FEMA)--a component of the Department of Homeland 
Security (DHS)--to manage preparedness grants and measure and assess 
National capabilities to respond to a major disaster. From fiscal years 
2002 through 2012, the Federal Government appropriated about $39 
billion to a variety of DHS homeland security preparedness grant 
programs to enhance the capabilities of State, territory, local, and 
Tribal governments to prevent, protect against, mitigate the effects 
of, respond to, and recover from terrorist attacks and other 
disasters.\1\ DHS allocated more than half of this total--$21.3 
billion--to grant recipients through four of the largest preparedness 
programs--the Port Security Grant Program, the State Homeland Security 
Program, the Transit Security Grant Program, and the Urban Areas 
Security Initiative.
---------------------------------------------------------------------------
    \1\ This total is based on Congressional Research Service data and 
our analysis, and includes firefighter assistance grants and emergency 
management performance grants. See Congressional Research Service, 
Department of Homeland Security Assistance to States and Localities: A 
Summary of Issues for the 111th Congress, R40246 (Washington, DC: Apr. 
30, 2010). For the purposes of this testimony, we define capabilities 
for prevention, protection, mitigation, response, and recovery as 
preparedness capabilities.
---------------------------------------------------------------------------
    Congress enacted the Post-Katrina Emergency Management Reform Act 
of 2006 (Post-Katrina Act) in the aftermath of Hurricane Katrina.\2\ In 
response to the act, among other things, DHS centralized most of its 
preparedness programs under FEMA's Grant Programs Directorate (GPD) to 
better integrate and coordinate grant management. The act also requires 
that FEMA develop a National preparedness system and assess 
preparedness capabilities to determine the Nation's preparedness 
capability levels and the resources needed to achieve desired levels of 
capability.\3\
---------------------------------------------------------------------------
    \2\ The Post-Katrina Act was enacted as Title VI of the Department 
of Homeland Security Appropriations Act, 2007, Pub. L. No. 109-295, 120 
Stat. 1355 (2006). The provisions of the Post-Katrina Act became 
effective upon enactment, October 4, 2006, with the exception of 
certain organizational changes related to FEMA, most of which took 
effect on March 31, 2007.
    \3\ According to the act, the assessment system must assess, among 
other things, current capability levels as compared with target 
capability levels (which, for the purposes of this testimony, we refer 
to as capability requirements), and resource needs to meet capability 
requirements. 6 U.S.C.  744, 749.
---------------------------------------------------------------------------
    In March 2012, we testified before this committee and summarized 
our work from April 2002 through February 2012 on DHS's and FEMA's 
efforts to manage preparedness grants; develop and assess National 
preparedness capabilities at the Federal, State, and local levels; 
identify capability gaps; and prioritize future National preparedness 
investments to fill the most critical gaps.\4\ As requested, my 
testimony today provides an update on that work, including the extent 
to which DHS and FEMA have made progress over the past year in: (1) 
Managing preparedness grants and (2) measuring National preparedness by 
assessing capabilities and addressing related challenges.
---------------------------------------------------------------------------
    \4\ GAO, Managing Preparedness Grants and Assessing National 
Capabilities: Continuing Challenges Impede FEMA's Progress, GAO-12-526T 
(Washington, DC: Mar. 20, 2012).
---------------------------------------------------------------------------
    My statement is based on our March 2012 testimony, as well as 
reports on DHS and FEMA grant management and preparedness that we 
issued from March 2011 through February 2012. More information about 
the scope and methodology of our prior work can be found in those 
reports. To update our work, we analyzed documentation such as DHS's 
National Preparedness Report, issued in March 2012; interviewed 
relevant FEMA officials to obtain updates on recent progress in 
managing preparedness grants and measuring National preparedness; and 
reviewed our prior reports. We conducted our work in accordance with 
generally accepted Government auditing standards. Those standards 
require that we plan and perform the audit to obtain sufficient, 
appropriate evidence to provide a reasonable basis for our findings and 
conclusions based on our audit objectives. We believe the evidence 
obtained provides a reasonable basis for our findings and conclusions 
based on our audit objectives.
                               background
    Over the past decade, the Federal Government has expanded financial 
assistance to a wide array of public and private stakeholders for 
preparedness activities through various grant programs administered by 
DHS through its component agency, FEMA. Through these grant programs, 
DHS has sought to enhance the capacity of States, localities, and other 
entities, such as ports or transit agencies, to prevent, respond to, 
and recover from a natural or man-made disaster, including terrorist 
incidents. Four of the largest preparedness grant programs are the Port 
Security Grant Program, the State Homeland Security Program, the 
Transit Security Grant Program, and the Urban Areas Security 
Initiative.
   The Port Security Grant Program provides Federal assistance 
        to strengthen the security of the Nation's ports against risks 
        associated with potential terrorist attacks by supporting 
        increased port-wide risk management, enhanced domain awareness, 
        training and exercises, and expanded port recovery 
        capabilities.
   The State Homeland Security Program provides funding to 
        support States' implementation of homeland security strategies 
        to address the identified planning, organization, equipment, 
        training, and exercise needs at the State and local levels to 
        prevent, protect against, respond to, and recover from acts of 
        terrorism and other catastrophic events.
   The Transit Security Grant Program provides funds to owners 
        and operators of transit systems (which include intracity bus, 
        commuter bus, ferries, and all forms of passenger rail) to 
        protect critical surface transportation infrastructure and the 
        traveling public from acts of terrorism and to increase the 
        resilience of transit infrastructure.
   The Urban Areas Security Initiative provides Federal 
        assistance to address the unique needs of high-threat, high-
        density urban areas, and assists the areas in building an 
        enhanced and sustainable capacity to prevent, protect, respond 
        to, and recover from acts of terrorism.
    Since its creation in April 2007, FEMA's GPD has been responsible 
for managing DHS's preparedness grants.\5\ GPD consolidated the grant 
business operations, systems, training, policy, and oversight of all 
FEMA grants and the program management of preparedness grants into a 
single entity.
---------------------------------------------------------------------------
    \5\ The Post-Katrina Act transferred most of the Preparedness 
Directorate to FEMA, effective on March 31, 2007. Pub. L. No. 109-295, 
120 Stat. 1355, 1394 (2006).
---------------------------------------------------------------------------
  fema has taken or proposed actions to address potential duplication 
            issues identified by gao, but challenges remain
FEMA Needs Better Coordination and Improved Data Collection to Reduce 
        Risk of Unnecessary Duplication in Four Grant Programs
    In February 2012, we identified multiple factors that contributed 
to the risk of FEMA potentially funding unnecessarily duplicative 
projects across four of the largest grant programs \6\--the Port 
Security Grant Program, the State Homeland Security Program, the 
Transit Security Grant Program, and the Urban Areas Security 
Initiative. These factors include overlap among grant recipients, 
goals, and geographic locations, combined with differing levels of 
information that FEMA had available regarding grant projects and 
recipients. Specifically, we found that FEMA made award decisions with 
differing levels of information and lacked a process to coordinate 
application reviews.\7\ To better identify potential unnecessary 
duplication, we recommended that FEMA: (1) Take steps to ensure that it 
collects project information at the level of detail needed to better 
position the agency to identify any potential unnecessary duplication 
within and across the four grant programs, and (2) explore 
opportunities to enhance FEMA's internal coordination and 
administration of the programs. DHS agreed with the recommendations and 
identified planned actions to improve visibility and coordination 
across programs and projects. We also suggested that Congress consider 
requiring DHS to report on the results of its efforts to identify and 
prevent duplication within and across the four grant programs, and 
consider these results when making future funding decisions for these 
programs.
---------------------------------------------------------------------------
    \6\ GAO, Homeland Security: DHS Needs Better Project Information 
and Coordination Among Four Overlapping Grant Programs, GAO-12-303 
(Washington, DC: Feb. 28, 2012).
    \7\ GAO, More Efficient and Effective Government: Opportunities to 
Reduce Duplication, Overlap and Fragmentation, Achieve Savings, and 
Enhance Revenue, GAO-12-449T (Washington, DC: Feb 28, 2012).
---------------------------------------------------------------------------
FEMA Has Taken Actions to Enhance Preparedness Grant Management, But 
        Challenges Remain
    Since we issued our February 2012 report, FEMA officials have 
identified actions they believe will enhance management of the four 
grant programs we analyzed; however, FEMA still faces challenges to 
enhancing preparedness grant management. First, the fiscal year 2013 
President's budget outlined a plan to consolidate most of FEMA's 
preparedness grants programs, and FEMA officials expect this action 
would reduce or eliminate the potential for unnecessary duplication. 
The fiscal year 2013 President's budget proposed the establishment of 
the National Preparedness Grant Program (NPGP), a consolidation of 16 
grant programs (including the 4 grants we analyzed in our February 2012 
report) into a comprehensive single program. According to FEMA 
officials, the NPGP would eliminate redundancies and requirements 
placed on both the Federal Government and grantees resulting from the 
existing system of multiple individual, and often disconnected, grant 
programs. For example, FEMA officials said that the number of 
applications a State would need to submit and the Federal Government's 
resources required to administer the applications would both decrease 
under the consolidated program. However, Members of Congress have 
expressed concern about the consolidation of the 16 grant programs and 
Congress has not yet approved the proposal. In October 2012, FEMA 
officials told us that Members of Congress had asked FEMA to refine the 
NPGP proposal to address concerns raised by stakeholders, such as how 
local officials will be involved in a State-administered grant program. 
As of March 2013, FEMA officials reported that the agency was drafting 
guidance for the execution of the NPGP based on stakeholder feedback 
and direction from Congress pending the fiscal year 2013 appropriations 
bill. If the NPGP is not authorized in fiscal year 2013, FEMA officials 
stated that the agency plans to resubmit the request for the fiscal 
year 2014 budgetary cycle. If approved, and depending on its final form 
and execution, the consolidated NPGP could help reduce redundancies and 
mitigate the potential for unnecessary duplication, and may address the 
recommendation in our February 2012 report to enhance FEMA's internal 
coordination and administration of the programs.
    Second, in March 2013, FEMA officials reported that the agency 
intends to start collecting and analyzing project-level data from 
grantees in fiscal year 2014; however, FEMA has not yet finalized 
specific data requirements and has not fully established the vehicle to 
collect these data--a new data system called the Non-Disaster Grants 
Management System (ND Grants). As of March 2013, FEMA officials expect 
to develop system enhancements for ND Grants to collect and use 
project-level data by the end of fiscal year 2013. FEMA officials 
stated that FEMA has formed a working group to develop the functional 
requirements for collecting and using project-level data and plans to 
obtain input from stakeholders and consider the cost effectiveness of 
potential data requirements. In alignment with data requirement 
recommendations from a May 2011 FEMA report, the agency anticipates 
utilizing the new project-level data in the grant application process 
starting in fiscal year 2014.\8\ Collecting appropriate data and 
implementing ND Grants with project-level enhancements as planned, and 
as recommended in our February 2012 report, would better position FEMA 
to identify potentially unnecessary duplication within and across grant 
programs.
---------------------------------------------------------------------------
    \8\ FEMA, Redundancy Elimination and Enhanced Performance for 
Preparedness Grants Act: Fiscal Year 2011 Report to Congress 
(Washington, DC: May 23, 2011).
---------------------------------------------------------------------------
    Third, in December 2012, FEMA officials stated that there are 
additional efforts underway to improve internal administration of 
different grant programs. For example, officials stated that a FEMA 
task force has been evaluating grants management processes and 
developing a series of recommendations to improve efficiencies, address 
gaps, and increase collaboration across regional and headquarters 
counterparts and financial and programmatic counterparts. These 
activities represent positive steps to improve overall grants 
management, but they do not include any mechanisms to identify 
potentially duplicative projects across grant programs administered by 
different FEMA entities.
     fema has made progress in establishing national preparedness 
    capabilities, but challenges remain in establishing performance 
        measures that could assist in prioritizing grant funding
FEMA Has Faced Challenges Developing a National Assessment of 
        Preparedness
    According to DHS and FEMA strategic documents, National 
preparedness is the shared responsibility of the ``whole community,'' 
which requires the contribution of a broad range of stakeholders, 
including Federal, State, and local governments, to develop 
preparedness capabilities to effectively prevent, protect against, 
mitigate the effects of, respond to, and recover from a major 
disaster.\9\ Figure 1 provides an illustration of how Federal, State, 
and local resources provide preparedness capabilities for different 
levels of government and at various levels of incident effect (i.e., 
the extent of damage caused by a natural or manmade disaster). The 
greater the level of incident effect, the more likely State and local 
resources are to be overwhelmed.
---------------------------------------------------------------------------
    \9\ FEMA, FEMA Strategic Plan: Fiscal Years 2011-2014 (Washington, 
DC: February 2011), and DHS, National Preparedness Goal (Washington, 
DC: September 2011).


    We have previously reported on and made recommendations related to 
DHS's and FEMA's efforts to develop a National assessment of 
preparedness, which would assist DHS and FEMA in effectively 
prioritizing investments to develop preparedness capabilities at all 
levels of government, including through its preparedness grant 
programs.\10\ Such an assessment would:
---------------------------------------------------------------------------
    \10\ GAO, Homeland Security: DHS's Efforts to Enhance First 
Responders' All-Hazards Capabilities Continue to Evolve, GAO-05-652 
(Washington, DC: July 11, 2005); and National Preparedness: FEMA Has 
Made Progress, but Needs to Complete and Integrate Planning Exercise 
and Assessment Efforts, GAO-09-369 (Washington, DC: Apr. 30, 2009).
---------------------------------------------------------------------------
   identify the critical elements at all levels of government 
        necessary to effectively prevent, protect against, mitigate the 
        effects of, respond to, and recover from a major disaster 
        (i.e., preparedness capabilities), such as the ability to 
        provide lifesaving medical treatment via emergency medical 
        services following a major disaster;
   develop a way to measure those elements (i.e., capability 
        performance measures); and
   assess the difference between the amount of preparedness 
        needed at all levels of government (i.e., capability 
        requirements) and the current level of preparedness (i.e. 
        capability level) to identify gaps (i.e., capability gaps).
    The identification of capability gaps is necessary to effectively 
prioritize preparedness grant funding.
    However, we have previously found that DHS and FEMA have faced 
challenges in developing and implementing such an assessment. Most 
recently, in March 2011, we reported that FEMA's efforts to develop and 
implement a comprehensive, measurable, National preparedness assessment 
were not yet complete. Accordingly, we recommended that FEMA complete a 
National preparedness assessment and that such an assessment should 
assess capability gaps at each level of Government based on capability 
requirements to enable prioritization of grant funding.\11\ We also 
suggested that Congress consider limiting preparedness grant funding 
until FEMA completes a National preparedness assessment. In April 2011, 
Congress passed the fiscal year 2011 appropriations act for DHS, which 
reduced funding for FEMA preparedness grants by $875 million from the 
amount requested in the President's fiscal year 2011 budget.\12\ The 
consolidated appropriations act for fiscal year 2012 appropriated $1.7 
billion for FEMA Preparedness grants, $1.28 billion less than 
requested.\13\ The House committee report accompanying the DHS 
appropriations bill for fiscal year 2012 stated that FEMA could not 
demonstrate how the use of the grants had enhanced disaster 
preparedness.\14\
---------------------------------------------------------------------------
    \11\ GAO, Opportunities to Reduce Potential Duplication in 
Government Programs Save Tax Dollars and Enhance Revenue, GAO-11-318SP 
(Washington, DC: Mar. 1, 2011).
    \12\ Pub. L. No. 112-10  1632, 125 Stat. 38, 143 (2011).
    \13\ Pub. L. No. 112-74, 125 Stat. 786, 960 (2011). This total 
includes all grant programs in the State and local programs account and 
the Emergency Management Performance Grant program but does not include 
funding appropriated for firefighter assistance grant programs.
    \14\ H.R. Rep. No. 112-91, at 106-08 (2011).
---------------------------------------------------------------------------
FEMA Has Made Progress in Establishing Preparedness Capabilities
    In March 2011, the White House issued Presidential Policy Directive 
8 on National Preparedness (PPD-8), which called for the development of 
a National preparedness system that includes a comprehensive approach 
to assess National preparedness. According to PPD-8, the approach 
should use a consistent methodology to assess National preparedness 
capabilities--with clear, objective, and quantifiable performance 
measures.\15\ PPD-8 also called for the development of a National 
preparedness goal, as well as annual preparedness reports (both of 
which were previously required under the Post-Katrina Act).\16\ To 
address PPD-8 provisions, FEMA issued the National Preparedness Goal in 
September 2011, which established a list of preparedness capabilities 
for each of five mission areas (prevention, protection, mitigation, 
response, and recovery) that are to serve as the basis for preparedness 
activities within FEMA, throughout the Federal Government, and at the 
State and local levels.\17\ In November 2011, FEMA issued the National 
Preparedness System, which described an approach and cycle to build, 
sustain, and deliver the preparedness capabilities described in the 
National Preparedness Goal. The system contains six components to 
support decision making, resource allocation, and progress measurement, 
including identifying and assessing risk and estimating capability 
requirements.\18\ According to the system, measuring progress toward 
achieving the National Preparedness Goal is intended to provide the 
means to decide how and where to allocate scarce resources and 
prioritize preparedness. Finally, in March 2012, FEMA issued the first 
National Preparedness Report, designed to identify progress made toward 
building, sustaining, and delivering the preparedness capabilities 
described in the National Preparedness Goal. According to FEMA 
officials, the National Preparedness Report also identifies what they 
consider to be National-level capability gaps.
---------------------------------------------------------------------------
    \15\ The Post-Katrina Act required FEMA, in developing guidelines 
to define preparedness capabilities, to ensure that the guidelines are 
specific, flexible, and measurable. 6 U.S.C.  746.
    \16\ 6 U.S.C.  743, 752. The Post-Katrina Act required FEMA to 
prepare a Federal preparedness report and a State preparedness report.
    \17\ The National Preparedness Goal refers to these capabilities as 
``core capabilities,'' which replace what had been previously called 
target capabilities. The target capabilities were initially developed 
by DHS in 2005. For example, one of the preparedness capabilities for 
the response mission area relates to mass search-and-rescue operations, 
specifically to deliver traditional and atypical search-and-rescue 
capabilities, including personnel, services, animals, and assets to 
survivors in need, with the goal of saving the greatest number of 
endangered lives in the shortest time possible.
    \18\ The six components are: (1) Identifying and assessing risk, 
(2) estimating capability requirements, (3) building and sustaining 
capabilities, (4) planning to deliver capabilities, (5) validating 
capabilities, and (6) reviewing and updating.
---------------------------------------------------------------------------
Challenges Remain in Establishing Capability Requirements and 
        Performance Measures That Could Assist in Prioritizing 
        Preparedness Grant Funding
    While FEMA issued the first National Preparedness Report, the 
agency has not yet established clear, objective, and quantifiable 
capability requirements and performance measures that are needed to 
identify capability gaps in a National preparedness assessment, as 
recommended in our March 2011 report. As previously noted, such 
requirements and measures would help FEMA identify capability gaps at 
all levels of government, which would assist FEMA in targeting 
preparedness grant program funding to address the highest-priority 
capability gaps. According to the National Preparedness Report, FEMA 
collaborated with Federal interagency partners to identify existing 
quantitative and qualitative performance and assessment data for each 
of the preparedness capabilities. In addition, FEMA integrated data 
from the 2011 State Preparedness Reports, which are State-wide survey-
based self-assessments of capability levels and requirements submitted 
by all 56 U.S. States and territories. Finally, FEMA conducted research 
to identify independent evaluations, surveys, and other supporting data 
related to preparedness capabilities.
    However, limitations associated with some of the data used in the 
National Preparedness Report may reduce the report's usefulness in 
assessing National preparedness. First, in October 2010, we reported 
that data in the State Preparedness Reports--one of the key data 
sources for the National Preparedness Report--could be limited because 
FEMA relies on States to self-report such data, which makes it 
difficult to ensure data are consistent and accurate.\19\ Second, at 
the time the National Preparedness Report was issued, in March 2012, 
States were still in the process of updating their efforts to collect, 
analyze, and report preparedness progress according to the new 
preparedness capabilities issued along with the National Preparedness 
Goal in September 2011. As a result, the report states that assessment 
processes, methodologies, and data will need to evolve for future 
iterations of the report. Third, the report's final finding notes that 
while many programs exist to build and sustain preparedness 
capabilities across all mission areas, challenges remain in measuring 
progress over time. According to the report, in many cases, measures do 
not yet exist to gauge performance, either quantitatively or 
qualitatively. Therefore, while programs may exist that are designed to 
address a given capability gap, the Nation has little way of knowing 
whether and to what extent those programs have been successful.
---------------------------------------------------------------------------
    \19\ GAO, FEMA Has Made Limited Progress in Efforts to Develop and 
Implement a System to Assess National Preparedness Capabilities, GAO-
11-51R (Washington, DC: Oct. 29, 2010).
---------------------------------------------------------------------------
    Thus, as of March 2013, FEMA has not yet completed a National 
preparedness assessment, as we recommended in our March 2011 report, 
which could assist FEMA in prioritizing grant funding. However, FEMA 
officials stated that they have efforts under way to assess regional, 
State, and local capabilities to provide a framework for completing a 
National preparedness assessment.\20\ For example, in April 2012, FEMA 
issued guidance on developing Threat and Hazard Identification and Risk 
Assessments (THIRA), which were initially required to be completed by 
State and local governments receiving homeland security funding by 
December 31, 2012.\21\ Guidance issued for development of the THIRAs 
describes a process for assessing the various threats and hazards 
facing a community, the vulnerability of the community, as well as the 
consequences associated with those threats and hazards. For example, 
using the THIRA process, a jurisdiction may identify tornadoes as a 
hazard and asses its vulnerabilities to and the consequences of a 
tornado striking the jurisdiction, as well as the capabilities 
necessary for an effective response. Using the THIRA results, a 
jurisdiction may then develop a strategy to allocate resources 
effectively to achieve self-determined capability requirements by 
closing capability gaps.
---------------------------------------------------------------------------
    \20\ GAO-11-318SP.
    \21\ According to FEMA officials, as of March 2013, some State and 
local urban areas had not yet completed their THIRAs. FEMA granted 6-
month extensions to the December 31, 2012 deadline for five States and 
three local urban areas affected by Hurricane Sandy in late October 
2012.
---------------------------------------------------------------------------
    According to FEMA officials in March 2013, the THIRAs are to be 
used by State, regional, and Federal entities for future planning 
efforts. At the State level, FEMA guidance notes that State officials 
are to use the capability requirements they identified in their 
respective 2012 THIRAs in their future State Preparedness Reports. FEMA 
officials stated that they planned to use both the THIRAs and the State 
Preparedness Reports to identify States' (self-reported) capability 
gaps based on capability requirements established by the State. At the 
regional level, each of the 10 FEMA regions is to analyze the local and 
State THIRAs to develop regional THIRAs.\22\ At the National level, the 
local, State, and regional THIRAs are collectively intended to provide 
FEMA with data that it can analyze to assist in the identification of 
National funding priorities for closing capability gaps. The outcome of 
the THIRA process is intended to be a set of National capability 
performance requirements and measures, which FEMA officials stated they 
intend to incorporate into future National Preparedness Reports. As of 
March 2013, FEMA officials are working to coordinate their review and 
analysis of the various THIRAs through a THIRA Analysis and Review 
Team. The team plans to conduct on-going meetings to discuss common 
themes and findings from the THIRAs and intends to develop an initial 
proposed list of National preparedness grant funding priorities by 
summer 2013.
---------------------------------------------------------------------------
    \22\ FEMA officials stated that they required the FEMA regions to 
complete their inaugural THIRAs by September 30, 2012, 3 months before 
the local and State THIRAs were due. As a result, the first regional 
THIRAs did not incorporate information from the local and State THIRAs. 
The officials explained that FEMA directed the regional THIRAs to be 
completed in 2012 before the local and State THIRAs in order to aid 
development of preparedness grant guidance for fiscal year 2013, but 
that future iterations of the regional THIRAs are intended to 
incorporate information from completed local and State THIRAs.
---------------------------------------------------------------------------
    Depending on how the THIRA process is implemented and incorporated 
into future National Preparedness Reports, such an approach could be a 
positive step toward addressing our March 2011 recommendation to FEMA 
to develop a National preparedness assessment of existing capabilities 
levels against capability requirements. Such a National preparedness 
assessment may help FEMA to: (1) Identify the potential costs for 
developing and maintaining required capabilities at each level of 
government, and (2) determine what capabilities Federal agencies should 
be prepared to provide. While the recently completed THIRAs and 2012 
National Preparedness Report are positive steps in the initial efforts 
to assess preparedness capabilities across the Nation, capability 
requirements and performance measures for each level of government that 
are clear, objective, and quantifiable have not yet been developed. As 
a result, it is unclear what capability gaps currently exist, including 
at the Federal level, and what level of resources will be needed to 
close such gaps through prioritized preparedness grant funding. We will 
continue to monitor FEMA's efforts to develop capability requirements 
and performance measures.
     Chairman Brooks, Ranking Member Payne, and Members of the 
subcommittee, this completes my prepared statement. I would be pleased 
to respond to any questions that you may have at this time.

    Mrs. Brooks. Thank you, Mr Maurer.
    I will now recognize myself for 5 minutes for questions. 
This is primarily to Administrator Manning.
    In 2010, as you just heard, Congress did pass and the 
President signed into law the Redundancy Elimination and 
Enhanced Performance Preparedness Grants Act. That bill was 
considered and passed by this subcommittee. Among other things, 
it required the FEMA administrator to enter into a contract 
with the National Academy of Public Administration, to study, 
develop, and implement the quantifiable performance measures we 
have been talking about, and metrics to assess the 
effectiveness of the grant.
    The report was released in October 2011, and it offered 16 
different recommendations of performance measures for FEMA's 
consideration. NAPA also recommended that FEMA conduct an 
assessment of collaborative approaches, in coordination with 
local jurisdictions, States, regions, and urban areas, and use 
the results to develop a scoring system for future quantitative 
or qualitative performance measures on collaboration, and to 
assist program participants specifically to strengthen their 
performance on these critical issues.
    Can you provide this subcommittee with an update on the 
implementation of those recommendations from NAPA, please?
    Mr. Manning. Madam Chairwoman, thank you. I would be very 
happy to. We, of course, implemented fully all the 
recommendations in the REEPPG Act. We entered into a contract 
with NAPA. We had a very productive review period, working with 
NAPA, received their report with great anticipation, and 
reviewed their recommendations that recommended metrics and 
performance measures against all of the things that we have 
been tracking.
    In most cases, were able to cross walk their 
recommendations against data that we had been collecting over 
the years in various forms, and were able to then consolidate 
that in a report back to the committee that updated where we 
are on those.
    I have a number of them with me. For example, one of the 
recommendations from NAPA on the kind of foundational 
activities of the whole program was to review and monitor the 
number of FEMA State and UASI risk assessments against their 
grants. We found that 100 percent of the States were current in 
that recommendation.
    We have subsequently updated that guidance, as you 
mentioned in your opening remarks, Madam Chairwoman, into the 
Threat and Hazard Identification Risk Assessment, the THIRA 
guidance, that will help track, implement specific measurable 
metrics for the grant program, things, identifying the gaps, 
the capabilities required in a given jurisdiction, the 
particular activities that need to be performed to achieve 
those capabilities, and the percent completion against those, 
against multiple grant years.
    The intention there is to achieve the goal, as has been 
described, in a measurable and meaningful way, as we continue 
to implement the programs.
    I would be happy to provide the committee with additional 
copies of those data, the measures that we achieved that we 
have tracked against the NAPA report, and address any further 
questions you may have on that.
    Mrs. Brooks. Were there any recommendations that you 
disagreed with specifically?
    Mr. Manning. I don't recall any that we explicitly 
disagreed with. There were some measures that we felt that we 
were collecting data in a way that achieved the intent of the 
recommendation, but in possibly a different way than was 
recommended in the report.
    That is summarized as well in the report. I would be happy 
to provide that to you.
    Mrs. Brooks. We would be interested in receiving that 
report.
    It is my understanding that the 2013 National Preparedness 
Report is due to the President this month. Is FEMA on track to 
deliver and provide that report to the President by its 
deadline?
    Mr. Manning. Madam Chairwoman, we are. We are very happy at 
the success of the 2012 National Preparedness Report. We think 
it is a very good summation of what we have achieved as a 
Nation since the advent of homeland security with the 
application of, at the time, I think just about $36 billion 
worth of preparedness assistance.
    The 2013 report, as you mentioned, is due to the President 
at the end of the month. It is on schedule. It is on track. We 
expect it delivered to the President on time.
    I think it will show measurable increases over last year's 
report.
    Mrs. Brooks. I would also ask, on behalf of the committee, 
that we receive the report as well.
    On a different note, there has been a backlog in the past 
in spending of grant funds. That has been referenced. It has 
been an issue for years.
    As of last month, FEMA reported $5.2 billion in grant funds 
from fiscal years 2008 through 2011 still yet to be drawn down. 
I know that some of these are still within the period of 
performance.
    But can you share with us whether or not the limitation on 
extensions that have been given--what impact they have had on 
the grantee's ability to spend those funds within the amount of 
time? Obviously, Congress is always looking at these funds. To 
see that we have over $5 billion still, you know, unspent, can 
you just speak to that, please?
    Mr. Manning. Yes, ma'am. As you may be aware, we have taken 
many steps to alleviate the backlog in draw-downs. There are a 
great many number of reasons as to why that condition grew over 
the years.
    In the last year, we have modified program guidance. We 
have issued information bulletins. We have worked with grantees 
in the way we provide extensions, addressing those extensions 
to really the only most critical areas that require extensions, 
and in places where there are business plans in place to show 
an appropriate burn rate and get that draw-down.
    All of the efforts we have taken together, I am very happy 
to tell you that over the last year, we have gone from just 
about $9 billion in undrawn balances--we are down to right 
about $4 billion now.
    We have made significant progress in just 1 year, cut that 
in almost half in the amount of money that has gone undrawn. We 
are continuing to work with all of our grantees. We expect that 
burn rate--we hope that burn rate to continue. We are working 
very closely with each and every individual grantee to ensure 
that continues.
    Mrs. Brooks. Thank you. Congratulations on that. We look 
forward to hearing more.
    The Chairwoman now recognizes Ranking Minority Member of 
the subcommittee, gentleman from New Jersey, Mr. Payne, for any 
questions.
    Mr. Payne. Thank you, Madam Chairwoman.
    Deputy Administrator Manning, sequestration has gone into 
effect now. Congress is debating the budget of this year. 
Sequestration has already led to cuts in areas like TSA, CBP, 
air traffic controllers and the like, which, in my opinion, 
reduces our ability to prepare for and protect against a 
terrorist threat.
    How will sequestration and proposed cuts in the House 
budget affect, if at all, FEMA's grant programs you have spoken 
about? In particular, UASI grants that benefits my district a 
great deal in New Jersey, Jersey City, Bayonne, and Newark, and 
that high-risk area about the port and Port Newark?
    Mr. Manning. Thank you. Those are very interesting and 
difficult questions that we have been wrestling with a great 
deal over the past few months. The grantees that we work with, 
all of the State and local governments across the country have 
made tremendous strides in their level of capabilities over the 
years.
    We continue to work with them.
    The sequestration impacts to the grants has resulted in a 
decrease to each of the grantees across the previous year. I am 
aware that there are a number of proposals under consideration 
in both the House and the Senate for the balance of the fiscal 
year funding and in out-years. As we address those varying 
funding levels, we would be happy to provide the committee with 
the particular impacts by grantee, as we were able to--as we 
are able to forecast that.
    I have no doubt, though, that FEMA will continue to work 
with all of our State and local partners to continue to develop 
the capabilities to address the most critical needs within each 
of those jurisdictions.
    We have been working over the years to increase flexibility 
in the way that grantees can use their funds to address those 
most specific problems unique to each individual. What we 
proposed last fiscal year in the National Preparedness Grant 
Program was an effort towards providing that coordination and 
flexibility with decreased funds, an ability to identify 
potential duplication, as you have heard from other witnesses 
this morning, and potentially alleviate that duplication and 
maximize the use of diminished resources available to the 
grantees.
    We will continue to work with people to identify those 
opportunities, leverage partnership possibilities between 
grantees. I have directed the staff within the Grants Program 
Directorate to compare the, for example, court and transit 
grant applications to the UASI grant applications and see if 
there are opportunities to get geographically similar grantees 
to be able to work together and leverage some of those 
resources as well.
    Mr. Payne. Well, I am a bit concerned that if, you know, 
the proposal to consolidate and go to a block--you talk about 
flexibility, I don't see how that allows for flexibility if it 
is turned into a bulk block grant. But we will see how that 
works out.
    You know, we have done a great deal of good work around the 
UASI grant in Newark. As the former president of council, I was 
very involved in that, in the hardening of, you know, certain 
targets and what have you. It would be unfortunate to have the 
work that we have done there diminished.
    But as we have been saying here, there is no real way to 
gauge. You know, it looked good to me, but, you know, from your 
perspective in understanding how well they have done with those 
dollars would be good to know. Thank you.
    Ms. Richards, you mentioned in your testimony that FEMA 
could strengthen its grant program by issuing further guidance 
to States. Yet the NPGP consolidates 16 grant programs into a 
block grant and gives even more discretion and less direction 
to the States.
    How do you expect that the funds under a block grant would 
be accounted for better, since it seems FEMA will have less 
presence?
    Ms. Richards. Sir, I would have to say that we have not 
audited a program that hasn't been implemented yet. So I am not 
able to fully answer your question.
    We have looked at some of FEMA's programs and identified 
areas where local entities were having to apply multiple times 
for funds for the same project, but trying to get it from 
different programs. We had recommended to FEMA that they look 
at consolidating some of those application processes to ease 
the burden on the States and the sub-grantees.
    As to how FEMA could oversee a block grant, I don't have 
any information on that today.
    Mr. Payne. I would just, as I am closing, say that, you 
know, I think that under consolidating this into a block grant 
and not dealing with the sub-recipients could fall under 
partisan and political concerns on the State level. If a State 
administration doesn't necessarily like the administration in a 
locale, that there could be effects to the grantee at the end.
    So I think that FEMA being involved in making sure without 
those issues at hand, in mind, can see that the sub-recipient 
is doing what they need to do, as opposed to someone making a 
decision because of their feeling this way or that way about an 
official.
    So thank you. I yield back.
    Mrs. Brooks. The Chairwoman now recognizes the Ranking 
Minority Member of the full committee, gentleman from 
Mississippi, Mr. Thompson, for any questions.
    Mr. Thompson. Thank you very much, Madam Chairwoman.
    Mr. Maurer, your review of the grant program listed some 
very I think salient issues. You said that at the time of your 
review, FEMA lacked the ways to measure how money was spent.
    That goes to the Chairwoman's question about how you have 
money left, if you don't know how you are measuring the way you 
have spent.
    So can you provide, after your review, what FEMA told you 
they did to correct that problem?
    Mr. Maurer. Yes, absolutely. After we completed our report 
last February, we followed up with FEMA to talk about their 
actions to address our recommendations. A lot of FEMA's efforts 
were wrapped up in their broader attempts to develop a clear 
National capabilities framework.
    As part of building up that framework, they are trying to 
enhance their ability to assess both the impacts of individual 
programs, as well as more broadly what has been accomplished to 
date and what still needs to be done in the future.
    Let me be the first to recognize, like I said in my opening 
statement, that this is difficult to do. FEMA definitely has a 
difficult challenge.
    But, you know, some of our work looking at other Federal 
programs, other Federal grant programs show that there are 
opportunities to achieve success or relative success in this 
area. There is no such thing as perfect performance measures. 
Nor is there such a thing as a perfect grant program.
    But other programs have made good efforts. So, for example, 
at the Department of Justice, we issued work looking at the 
Justice Assistance Grant Program, which is roughly analogous to 
the State Homeland Security Grant Program at FEMA. When we did 
our review, DOJ was in the process of developing measures.
    We recommended they take a couple of actions to enhance 
those measures. They did that. They worked more closely with 
the local stakeholders, for example, to get input on those 
measures. DOJ also took efforts to validate the information 
that was coming in from the recipients. In other words, trust 
what they are reporting but also verify it.
    Another large program that has some reasonably effective 
measures is the President's Emergency Program for AIDS Relief. 
This is a $44 billion multi-agency effort to combat AIDS.
    Mr. Thompson. Just so you are satisfied that they are 
moving in the right direction?
    Mr. Maurer. I think they are definitely on the right track. 
We are going to keep a careful eye on what they are doing. But 
they still have a long way to go, however.
    Mr. Thompson. Well, as part of the review, Mr. Manning, can 
you explain to me the oversight responsibility for the regional 
offices in the grants program?
    Mr. Manning. Yes, sir. Our 10 FEMA regional offices work 
very closely with the State and local jurisdictions within 
their geographic area. We have over the years modified the way 
we oversee and manage the grants programs. We have divested a 
great deal of programmatic oversight in certain portfolios of 
the preparedness grants to our regional grants administrators.
    The National applications for the Homeland Security Grant 
Program still come to the National level, still come to 
Washington. They are reviewed through our 2013 integrated 
monitoring plan for fiscal and programmatic monitoring, happens 
within the headquarters area here, but specific implementation 
steps on many of the procurement actions, the Emergency 
Management Performance Grant, which is a very successful grant 
program that builds capability for disaster response, really 
the backbone of emergency management across the country, is 
entirely managed within our regional structure at this time.
    We have reorganized each of our 10 regions to have a 
dedicated grant management division that reports directly to 
the regional administrator and coordinates with the Grants 
Program Directorate here in Washington.
    Mr. Thompson. Well, can you provide the committee with a 
little more--in other words, a State or locality applies to the 
National office, but you outsource the responsibility for 
monitoring to a regional office. Am I correct?
    Mr. Manning. That is correct. Each individual State or 
local jurisdiction, working through their State, applies to the 
National level, so we can compare the applications across at 
the National level. But we are one FEMA.
    Mr. Thompson. Are they compared Nationally or are they 
compared regionally?
    Mr. Manning. The activities that a particular grantee 
proposes to accomplish, that has opportunities to leverage on 
each other's States, for mutual aid opportunities, for example, 
are coordinated by the regions, most definitely.
    But where there are competitive applications, the 
Assistance of Firefighters Grants, for example, the SAFER 
Grants, where they are a competitive grant program, they are 
reviewed against the entire Nation by a peer review panel that 
is assembled here in Washington, made of grantee peers from 
across the country.
    Mr. Thompson. A little confusing as to how you describe it, 
because I am trying to see whether or not a State like 
Mississippi is competing against people in Mississippi, people 
in the region or people Nationally.
    Mr. Manning. I understand. The State of Mississippi, in the 
Homeland Security Grant Program, HSGP and UASI grant program, 
is not competing against other States. They are competing 
against--their application is not in competition against other 
States regionally or Nationally.
    The homeland security risk, as outlined in the Post-Katrina 
Act, that is used to determine the allocation amount by State, 
is a National list. So the risk to Mississippi from a terrorist 
attack is compared against the other 49 States. That is 
correct.
    But in the competition--there is no competition in those 
grants. The Port Grants are competed within the area by the 
captain of the port. We work closely with the Coast Guard. I 
would be happy to coordinate the Coast Guard to come give you a 
much deeper brief, if you would like it, on how that process 
works.
    Mr. Thompson. Well, thank you, Madam Chairwoman.
    I guess one of the policy questions is, is FEMA best-suited 
to run a grants program, period? Or should they just be in the 
disaster response and recovery business, rather the grants? I 
don't know. I just see you trying to build capability with an 
agency whose mission is in another direction.
    I yield back. Thank you.
    Mrs. Brooks. Thank you.
    The Chairwoman will now recognize other Members of the 
subcommittee for questions they may wish to ask the witnesses. 
In accordance with the committee rules and practice, I plan to 
recognize Members who were present at the start of the hearing, 
by seniority on the subcommittee. Those coming in later will be 
recognized in order of arrival.
    So at this point, the Chairwoman now recognizes the 
gentleman from Pennsylvania, Congressman Perry, for any 
questions.
    Mr. Perry. Thank you, Madam Chairwoman.
    Thank you for coming in to testify. All of you really 
offered some very compelling information for me in particular. 
I am sure for everybody else as well. I am not sure exactly who 
to address the question to. I have been in and out a little 
bit. So I am trying not to be redundant. If I am, please let me 
know, because I will have more.
    But for Pennsylvania, we saw about $20 million in 
Assistance to Firefighters Grants, money being used for 
equipment and vehicles. From my standpoint, the turnout in gear 
and vehicles and equipment is really where these folks want to 
spend that money. We have a huge amount of volunteer and 
professional firefighters and emergency responders in 
Pennsylvania.
    The particular grant has been highlighted, though, as a 
source of waste within the Department. I am just wondering if 
there is some way to ensure the--first of all, is that what we 
should be procuring? Because in the testimony, one of the 
things I kind of get is a flavor of we don't really know 
exactly, in this regard, what the grant program--and correct me 
if I am wrong--what exactly our mission is. What are we trying 
to achieve?
    If that is the case, you know, is there some way to make 
sure these funds are directly correlated with increased 
firefighter safety, security, productivity?
    Please, anyone chime in if you feel compelled.
    Mr. Manning. Thank you. Absolutely. It is important, I 
think first, to note there are a great many number of grant 
programs, each of which has a different objective and a 
different goal and a different administration process. So while 
the Homeland Security Grant Program has a certain suite of 
things that are eligible for acquisition or training 
opportunities that are eligible to be paid for, the Emergency 
Management Performance Grant has a different set.
    The Assistance to Firefighters Grant was created expressly 
for building the material and training capacity in fire 
departments across the country, most predominantly bunker gear, 
air packs, fire apparatus, those sorts of things.
    There has been a measurable amount of resources put against 
firefighter wellness as well, to increase the capability of 
firefighters themselves.
    We know with great detail exactly what has been purchased 
against all of these grants. We know what equipment has been 
procured. We know who has been trained in what. Those are the 
data that we have used to develop the National Preparedness 
Report last year and are doing this year.
    I think the Assistance to Firefighters Grant, it is 
monitored closely, as we were describing, through our 
integrated monitoring plan. It is one of those suite of grants 
that is monitored at least biannually. We have a process that 
we use to evaluate each grantee to determine if they are high-
risk or not, to get more close scrutiny.
    Our monitoring process is one to identify problems before 
they happen. It is not an audit, per se. Where we identify 
potential problems either through fraud, waste, or abuse, we 
are happy to refer those to our colleagues at the inspector 
general.
    I think what has been procured, what we are trying to 
achieve in the Assistance to Firefighter Grants is critical for 
the Nation, for the Nation's capability, has very specific 
activities and pieces of equipment that aren't eligible for 
procurement under any other grant program.
    That particular one is not duplicated by anything else. At 
the same time, we do coordinate what is happening, what the 
applications are with the States, so they know that a 
particular jurisdiction has received an award for, say, a piece 
of new fire apparatus, a new engine, a new ladder truck. So the 
State will know, and they know that they don't have to worry 
about duplicating assistance there.
    Mr. Perry. Okay. Then just since you mentioned it--and let 
me say this because I don't want to run out of time just by--I 
want to get this point in, especially for our volunteer 
firefighters and emergency responders. Those are the folks--the 
volunteers are filling out the grant applications.
    These are folks that have jobs, whether under the fire, 
police, or whatever, that are leaving their employment to go 
fight the fire or, you know, tend duties as fire, police, or 
whatever. So the less onerous and the more direct that those 
grant applications can be, the better for them.
    With that, I am just wondering, is there a metric? You 
know, I am picturing the firefighters that I know. Is there 
some metric to describe wellness and fitness programs, so we 
make sure? Most of the folks I know want the gear. You know, 
wellness is all probably some descriptive term that is hard to 
pin down.
    I am just looking for some kind of metric that you guys use 
to determine what that is. I will yield when the answer is in.
    Mr. Manning. Certainly. I would be happy to have the grant 
staff--and we will come over and provide you a very detailed 
briefing on that particular element of the grant program.
    The vast majority of that grant does, in fact, go to 
equipment, to bunker gear, to apparatus. We do our level best 
to make that grant application as simple and non-onerous as 
possible.
    I was one of those volunteer firefighters. I used every 
hour of my vacation day for 10 years to go to calls and go to 
training. There is nothing I hate more than an overly 
complicated process where we are trying to help people that are 
trying to do this on their nights and weekends.
    We do everything we can to make it as simple as possible.
    Mr. Perry. Thank you.
    Mr. Maurer. Representative Perry, if I can, just real 
quickly? One thing to always keep in mind for any grant 
program--I mean, if you are talking specifically about 
firefighters, more equipment and more training is always sort 
of generically better. But the challenge is how much more do we 
need and how much more should the Federal Government provide 
its resources towards providing that support at the State and 
local level?
    Not having that framework in place makes it very difficult 
to make that kind of assessment.
    Mrs. Brooks. The Chairwoman now recognizes the gentlelady 
from New York, Ms. Clarke, for any questions.
    Ms. Clarke. Thank you very much, Madam Chairwoman, Ranking 
Member.
    Thank you to our witnesses. This is a very interesting 
conversation we are having today, because I come from a very 
complex user or grantee environment, grantee-rich environment. 
When I think about this grant consolidation, particularly for a 
city like New York, it becomes a bit more imperative that we 
really look at what the implications here are.
    We have a transit. We have the ports. So for them to be 
basically competing for the same pot of money in such a very 
complex environment is a bit concerning.
    Ms. Richards stated--this question is to just Deputy 
Administrator Manning. Ms. Richards stated that the OIG audits 
unveiled States did not always obligate the HSGP grants to sub-
grantees in a timely manner, which would potentially cause an 
increase in sub-grantee's administrative costs, and hinder the 
sub-grantee's ability to complete projects and deliver needed 
equipment and training.
    State grantees did not properly reimburse sub-grantees for 
their grant expenditures. Again, I am looking at the context of 
a place like New York City, within the context of a State like 
New York. How would the NPGP promote efficiencies with sub-
grantee draw-downs?
    Since it is unclear how the funding in the NPGP will be 
distributed to local areas, how do we assure that it is used to 
meet local threats and preparedness gaps? How do we ensure that 
the political considerations do not become the criteria for the 
distribution of these funds?
    So that is like a bundle of stuff there. I hope you can 
address it.
    Mr. Manning. Yes, ma'am. Thank you. I particularly like 
your description of a grantee-rich environment. I think that is 
very appropriate.
    I think an important thing to consider in our proposal of 
the National Preparedness Grant Program last year, and our 
discussion of that, is that it works in combination with the 
shift in philosophy in implementation that has come from 
Presidential Decision Directive 8, the National Preparedness 
System.
    In the past, the Homeland Security Grant Program and the 
UASI grant programs have functioned under State-specific 
strategies, in which a great deal of latitude was provided and 
very little specificity on how to conceive of what needs to be 
achieved in a particular jurisdiction.
    You have heard from both witnesses this morning the 
attendant problems we have had with that approach, that it was 
difficult to understand or conceive of a National level of 
preparedness, how prepared are we, and how much more prepared 
do we need to be.
    The idea around the National Preparedness Grant Program was 
one of consolidation of the multiple buckets of grants in a way 
that we can, in combination with an approach that looks at the 
most likely severe threats and hazards to a jurisdiction, 
through the lens of this National preparedness goal, our 
multiple core capabilities.
    For example, if we look in New York City, of the various 
threats and hazards that exist to the city of New York and the 
entire New York urban area, you may consider the effects of a 
large hurricane. Certainly with Sandy we now have an all-too-
real tangible evidence of what happens.
    But just a few years ago, that was a planning scenario. 
That wasn't one that we had experienced in quite some time. You 
may look at a large terrorist attack. You could look at a 
series of tornadoes, even an earthquake.
    A couple of years ago, no one would have considered the 
northeast at risk of much earthquake. You see the scaffolding 
going up around town to repair the damage here in Washington.
    When you consider the threats and hazards against the very 
specific geographic area, against these core capabilities, you 
have an idea of your targets. So, for example, the New York 
area has been building advanced search-and-rescue capability 
for some time, but not using a coordinated method, where you 
can understand what needs to be built in a way that we can 
compare across the entire New York Metro Area, across the 
entire State of New York, all of FEMA Region II, the eastern 
seaboard, the entire eastern United States or across the whole 
country.
    So as we were talking earlier of the THIRA and the system, 
the idea is simply one of what could possibly happen where I 
live? Using this language of our NIMS, the National Incident 
Management System that we have rolled out over the last 10 
years, using that for resource typing, given what might happen, 
what do I need?
    Then focusing the grants on the gaps. So if I determine 
that I need four urban search-and-rescue teams, and I know that 
I have three in New York, I know that is a priority. I am going 
to work between FDNY and the police department and the Port 
Authority to try to build those capabilities in response, 
prevention, protection, mitigation, and recovery.
    Certainly, there are critical infrastructure protection 
challenges with the port and transit facilities that don't lend 
itself to that evaluation. We have been working very closely, 
in fact using the Port Authority of New York and New Jersey as 
our example and our closest collaborator, on determining a way 
that that would most effectively work.
    Mrs. Brooks. Thank you.
    The Chairwoman now recognizes the gentleman from 
Pennsylvania, Mr. Marino, for questions.
    Mr. Marino. Thank you, Madam Chairwoman.
    Thank you for being here, folks. I am going to get right 
into the questioning.
    I am from northeast Pennsylvania, 10th Congressional 
District. We have been hit just like everyone else, floods and 
you name it. We have had our share.
    There is a fire department in my district, volunteer, who 
put together rather a very well-written grant. They were told 
it was a very well-written grant to help them purchase a new 
fire truck. They received notice several weeks ago that they 
had been turned down.
    The call was made as to why they were turned down. Here is 
the response they got: ``Well, you have written on here that it 
is a 1986 fire truck and it is not old enough.'' They said, 
``We don't have an 1986. We have a 1968.'' The numbers were 
transposed.
    So whoever typed up at the fire department the last hard 
copy changed from a 1968 to a 1986. They were told that FEMA 
that--``too bad. You have to reapply again, because you have 
the wrong date of fire truck down.''
    ``Well, can we have it back and we will switch it or we 
will tell you or we will send a supplement?''
    ``No, you are out of the grant process.''
    Now, can any of you respond to that? Because, quite 
obviously, on its face, after sending in a 25-page grant, it is 
just ridiculous.
    So Mr. Manning and then Ms. Richards and Mr. Maurer.
    Mr. Manning. Sir, I am sorry to say, I do hear examples 
like that all too often. I will happily go back and look very 
closely into your specific example.
    I can say, though, in having looked into these in the past, 
the problem is simply one of the competitiveness of this 
program. I know this isn't going to be a satisfactory answer. 
There are thousands and thousands and thousands of applications 
against this grant program, each of which has a compelling need 
for that particular department.
    The staff is forced to make extremely difficult decisions, 
often on what seem in retrospect to be occasionally arbitrary 
decisions like that. The decisions on which applications are 
successful or not are made by a peer-reviewed panel of like 
fire departments, representatives from across the country.
    I----
    Mr. Marino. If I may, would the grants have been decided 
upon before the notification was sent out saying, it is too-new 
of a truck, we cannot? I can understand that.
    Mr. Manning. Yes, sir. The awards are decided upon before 
the notifications are made.
    Mr. Marino. Okay, that answers that question. But perhaps I 
can give you specifics and perhaps we can look at it.
    Mr. Manning. Yes. We would be happy to help them, you 
know----
    Mr. Marino. I have looked over your background. You are 
very well-educated. You are very well-qualified. I would not be 
so bold as to tell you how to do what you are doing, whatever 
that is, how complex it is.
    But this is a general question pertaining to some stats. We 
have spent approximately, for preparedness grants since 2001, 
$40 billion dollars. Now in your opinions, are we getting the 
bang for our buck? How do we know we are getting the bang for 
our buck, question No. 2?
    No. 3, have any of you experienced a situation, like we all 
have--we are human; it is complicated--where this is absolutely 
ridiculous, on what we spent this money on, and it just didn't 
serve the purpose and it wasn't effective and efficient?
    So if you would, please? Mr. Maurer, do you want to start 
on that and work to your right?
    Mr. Maurer. Yes, absolutely. Certainly with that $40 
billion, we now have more equipment. We certainly have more 
training. We have more generic capability. How much more? We 
don't really know.
    How much closer we are to what we need, we don't really 
know that either. That is the central challenge facing this 
whole program, kind of writ large, is knowing when do we need 
another $100 billion? Do we need another $10 billion?
    Where does that money need to go, in what areas? That still 
remains unclear.
    Mr. Marino. Let us move on to the next part of this, as far 
as--and if you want to tap on, add a little bit, that is fine. 
But how about, are we looking for programs and saying, this 
just didn't work? It is not working, scrap it and start over?
    Ms. Richards.
    Ms. Richards. When we do our audits, we do look at what 
equipment has been bought. At the inception of the program, we 
did make several reports where we had found that equipment that 
was bought was not appropriate for the situation. It was not in 
accordance with FEMA's rules. Or it was being used for non-
approved purposes.
    Over the life of this grant program, that has diminished 
considerably. At this point, we are finding that only very 
rarely----
    Mr. Marino. Good.
    Ms. Richards [continuing]. That they are buying 
inappropriate equipment.
    Mr. Marino. I see my time has expired. I yield back.
    Mrs. Brooks. Thank you.
    I will now recognize myself.
    To Mr. Maurer, GAO has repeatedly expressed concerns 
regarding FEMA's inability to assess National preparedness. You 
just mentioned it yet again. Given the work that has been done 
to date--and there has been considerable work done to date--
what, in your opinion, remains to be done?
    What does FEMA need to be doing to address GAO's concerns?
    Mr. Maurer. Well, they need to finish the work on 
implementing the requirements of the Presidential directive. 
They certainly had that framework in place. We are looking 
forward to seeing the next National Preparedness Report.
    The THIRA process is underway. They don't have all the 
THIRAs in from all the various States. A number of them 
received extensions for very valid reasons, because of 
Hurricane Sandy.
    But we are looking forward for that being completed.
    Mrs. Brooks. I am sorry. Could you please explain for the 
panel the THIRA again?
    Mr. Maurer. Yes. In generic terms, it is ability to assess 
the risks that the State and locals are facing from a variety 
of threats. It is a way of doing that in a comprehensive way. 
It gives them a common way of expressing that to FEMA. The idea 
is that FEMA would be able to direct money towards those areas 
with the greatest risks, where there are still capabilities 
gaps.
    Another issue that we think it is important for FEMA to 
address is looking more closely at the self-reported nature of 
the information that underlies this kind of reporting.
    So, for example, the way the system is set up now, the 
States are reporting on what they think their capabilities are 
and what they think their capabilities need to be. It is 
certainly appropriate to get that level of input from the 
recipients. But we also think it is important to have some look 
into that at the Federal level, to make sure that there is 
oversight of that as well.
    That has been one of the sort of overarching issues we have 
identified in all of our grants work across the Federal 
Government, this idea that there needs to be oversight of self-
reported data.
    A third issue that we think is important to address is 
developing specific measures on individual programs, which will 
help build up the broader capability of assessing capabilities 
and capability gaps.
    Mrs. Brooks. To Administrator Manning, to his point with 
respect to the oversight of the State self-reporting, what is 
your response as to what FEMA is doing, you know, to give that 
analysis and oversight as to what the States' requests are?
    Mr. Manning. Yes, the balance of third-party or independent 
research into the level of preparedness of a particular grantee 
or State and local jurisdiction, and the self-reported nature 
of most of the data, that is one we are always struggling with 
and constantly trying to refine.
    A number of years ago, it was entirely self-reported. We 
have gone into a more objective, more quantitative methodology 
with the adoption of the THIRA and that process through the 
National Preparedness System, one where self-reporting is going 
to be less subjective, less qualitative, and something that is 
more concrete and more easily auditable on the back end.
    We are also using additional Federally-driven or third-
party reviews of activity, not simply requiring--relying, 
excuse me--on self-reporting data. It is one that I don't 
believe we will ever completely resolve. As anyone who does 
fundamentally qualitative research will tell you, it is 
something you are constantly having to modify your research 
methodologies to achieve the relevant data.
    Mrs. Brooks. When you indicate third-party reviews, what 
third party are you referring to?
    Mr. Manning. In many cases, we are talking about relevant 
National associations, for example fusion centers. There are a 
baseline assessment for fusion centers. In the past, it used to 
be: Do you have one, do you not have one, do you feel good 
about it? Those were the measures.
    Now we are using these assessments, these baseline 
capability assessments that were done collaboratively by the 
fusion centers, through their National association, in 
collaboration with the Intelligence and Analysis Division of 
the Department of Homeland Security.
    So we have this kind of third-party review of the data sets 
and the collective data, to help us determine whether it is 
relevant or not.
    Mrs. Brooks. Thank you. Just finally, talking about fusion 
centers, I was able to visit my State's fusion center. As a 
former United States attorney, was involved in standing up the 
fusion center in Indiana. So I have been very familiar with 
fusion centers and the importance of them.
    Is FEMA now able to more accurately report how much grant 
dollars have gone toward fusion centers across the country?
    Mr. Manning. Yes, we are. That is a very important point. 
In the beginning of the fusion centers, I too was involved, 
prior to my Federal service, in standing up one of the fusion 
centers and helping build that network across the country. In 
the early days, it was something that was--it was a grassroots 
initiative. It wasn't a Federally-driven program.
    Because of that, there weren't the tools built into the 
grant process to track that specifically. So retrospectively, 
when we try to figure out--when we were trying to figure out 
how much money has gone into fusion centers, we had to do 
essentially keyword searches on things like ``information 
sharing, data analysis systems, fusion centers,'' that sort of 
thing.
    We got what we believed to be inflated numbers, because in 
many cases a grantee may have been procuring mobile data 
terminals for their law enforcement, for their patrol vehicles. 
It may support the fusion center, but not specifically for the 
fusion center.
    Now, as we shift into program-level reporting in the grant 
applications--but certainly even now, as we require the 
grantees, if it is an explicit funding line for a fusion 
center, there is a box that says, ``this is for a fusion 
center.''
    So it is a very clear, binary analysis of whether it is 
fusion-center funding or not.
    Mrs. Brooks. Okay. Thanks.
    I now recognize the Ranking Member of the committee, 
gentleman from New Jersey, Mr. Payne. Any further questions?
    Mr. Payne. Yes, thank you, Madam Chairwoman.
    You know, back to the NPGP grant consolidation and my 
concerns really about that taking place; I understand FEMA 
plans to include the NPGP program in its 2014 budget request, 
with modifications to address the concerns raised by 
stakeholders after the program was initially proposed last 
year.
    What modifications should we expect to see in the National 
Preparedness Grant Program proposal?
    Mr. Manning. Thank you, Ranking Member Payne. Since we 
originally proposed that in the fiscal 2013 budget request, the 
administration has taken the advice, has very clearly heard the 
advice of both the House and the Senate and all of our 
constituents and partners across the country.
    We have been working non-stop with all of our urban area 
partners, our State partners, port, transit, the relevant 
constituent groups, law enforcement, fire service, public 
works, on listening to their concerns and considering how what 
we had proposed or what we are considering could be best 
addressed, best modified, best constructed to achieve those.
    Going forward, I think it is important for me to note that 
we will, of course, comply with whatever Congress directs us to 
do in the budget we have in 2013. Whatever is--we will 
function--we will design the grant programs and implement as 
authorized and as directed in the appropriation.
    As for what we may propose for the 2014 submission, I am 
happy once the administration does make its proposal to go into 
more detail. But at this time, I can't, unfortunately, comment 
on a budget proposal that has yet to be released.
    Mr. Payne. Okay. Second, you know, homeland security 
stakeholders at the State and local level have had to deal with 
multiple iterations, you know, of FEMA's attempt to measure 
performance and meet Congressional mandates.
    What support and training would be provided to States and 
locals to support these new monitoring efforts?
    Mr. Manning. You are absolutely correct in that assessment. 
As a former grantee myself, I am very well-versed in what FEMA 
and the Department, prior to the Post-Katrina Act and grants 
moving to FEMA, how that works. We have a great deal of 
opportunities through our technical assistance function, our 
technical assistance branch, as we change reporting 
requirements, grant application requirements, to work with our 
grantees.
    We schedule as we can, as funds are available and as travel 
is available, to go to areas where grantees are to help them, 
or try to bring them into central locations, not always just 
Washington, but across the country, to work with them.
    As we are shifting the philosophy of the National 
Preparedness System and the things that the grants are trying 
to achieve and how they work together, we have had workshops 
all across the country, multiple in every region to work 
through how the THIRA is supposed to work, with capability 
estimation is supposed to work, and how all of that functions 
and supports the grant applications, to make their lives as 
easy as possible.
    We do everything we can to do that. We will continue. You 
have my assurance that we will do as much outreach and as much 
technical assistance is possible, as any of these requirements 
shift, to make the grantees successful in doing their work.
    Mr. Payne. So, you know, any additional changes to the FEMA 
grant monitoring process in the next year--you know, I am 
concerned that when will you notify the State and local 
stakeholders?
    Mr. Manning. The grant monitoring process, we do it with 
our integrated monitoring. The grantees know at the time of 
their award whether they have been flagged as a grantee that we 
are going to be working with.
    It is criteria that are published and well-understood, 
things like a new grantee or a great number of audit findings, 
those sorts of things. We work very closely with those 
grantees. At no time should that be a surprise to anyone in the 
monitoring system.
    Mr. Payne. Well, you know, Mr. Manning, let me--sorry, 
Deputy Manning, let me just thank you for your testimony today.
    But I am still concerned that, you know, the Department's 
NPGP proposal does not provide substantial details on how the 
grant program may work, how the funds will be distributed or 
what safeguards will be in place to ensure local threats and 
preparedness gaps are actually closed.
    So I am still not sold on this being the best direction, 
and a way for the funds to be allocated out of a block, as 
opposed to the way they are managed now. Because, as I said, in 
Newark, we have had substantial success in being involved 
directly with the Federal Government.
    But to put it in that block, in my State, gives me pause. 
So I just want to put that on the record.
    I yield back.
    Mrs. Brooks. Thank you.
    Mr. Manning, last week, or sometime in the month of March, 
we received this capability estimation report. It is a draft, 
as I understand it, a comprehensive preparedness guide, which 
is supposed to help States and localities identify the 
resources it needs.
    When can we expect the final version? What I liked about 
it, it is very specific. It gives ideas as to whether or not 
there are shortfalls on certain areas. So when will they get 
the final guide for this?
    Then also, how will this capability estimation report 
impact grants awards?
    Mr. Manning. Thank you. Thank you for the comments on it as 
well.
    I think that goes to the example I was using with 
Congressman Perry that we try to make it as simple and 
implementable, usable for the grantees as possible.
    We are in our, I hope to be, final stages of collaborative 
development with our partners. We try not to do anything and 
just drop it on grantees. So we are working, working with 
partners to pilot it, to work through it. We just finished a 
pilot with the city of Baltimore to see how effective it would 
be in a complex urban area.
    We are working with others as well.
    We don't have a specific hard release date at this time, 
but I expect it to be very, very soon. As soon as we have 
analyzed the results of our pilot with Baltimore and other 
jurisdictions, we will be able to finalize that.
    We will be happy--we will, of course, let you know as soon 
as we finalize that date. But as you said, it is widely 
available for everybody's use now. But it is important to us 
that it work effectively for all the grantees before we 
finalize anything.
    The intent is that it be used in the future to drive the 
prioritization of acquisition from the grants, but not be award 
itself. It is not envisioned to make a determination, at this 
time, on which grantees are more needy than another grantee, to 
make allocations decisions.
    We do and will continue to operate under the authorizations 
in the Post-Katrina Act and the 9/11 Act that determine those 
award amounts.
    The idea here is that, as I described earlier, the current 
regime is simply one of a jurisdiction having determined their 
own strategy a number of years ago, without coordination with 
other jurisdictions around the country, and in a way that we, 
the Federal Government, on your behalf, and on America's people 
behalf, can't understand what a jurisdiction may be done or 
what is most important, given some others.
    To go back to a question that Congressman Marino had about 
the bang for the buck, this is a tool. That is how we got here. 
We absolutely have seen a tremendous bang for the buck, beyond 
performance measures, in real examples, things like the fact 
that in Joplin, after the tornadoes tore through Joplin, this 
kind of tragic event, in the past it would have been about 24 
to 48 hours before advanced search-and-rescue was on the 
ground.
    They were done with search-and-rescue by dawn the next 
morning, because of capabilities built under this program. 
Capabilities in that example that have been quantified under 
the National Incident Management System for a number of years, 
one of the examples we used in developing that.
    The capability estimation tool drives against all the core 
capabilities, provides the tool for a jurisdiction to take the 
threats and hazards it is facing, contextualize it to their own 
community, take the NIMS resource typing--that is what this 
tool does--and lets them say, I need this much sheltering 
capacity; I need this much mass casualty response; I need this 
many SWAT teams, bomb teams, that sort of thing, in a way that 
we have never been able to do Nationally before.
    Beyond the grants, what is most important to the public, it 
provides a planning tool for mutual, to say--for example, say I 
am a mid-sized Midwestern city, and I know I have a gap that I 
identified through the Capability Estimation Tool. I know I 
don't have the resources to fill that gap through acquisitions. 
So I know I need to enter into a mutual aid plan with a 
neighboring State or a city 4, 5, 6, 8 hours away.
    That is not a tool--nobody has been able to do that in a 
coordinated way before. We are very excited about the 
opportunity.
    Mrs. Brooks. Thank you very much. We look forward to seeing 
what the final version looks like.
    I would like to thank the witnesses.
    Or I am sorry. Do you have any further questions?
    Mr. Payne. No, ma'am.
    Mrs. Brooks. Okay, thank you.
    I would like to thank the witnesses for your valuable 
testimony. As you said, we are, I believe, since having been 
involved in this since 9/11 or shortly after 9/11, when I 
became the U.S. attorney--I do believe that over this period of 
time, we are quicker. We are better. We are safer for the work 
that FEMA has done, and work particularly of the State and 
locals, and FEMA's support of the State and locals.
    Obviously a lot of progress has been made, and we're 
continuing to make the progress. But with tightening Federal 
Government resources, that is why it is so important for us to 
continue this oversight and continue to ask these questions, to 
make sure that the grants that are provided to our State and 
local governments are utilized to the best of their 
capabilities.
    But I think when you mention what happened in Joplin, in 
particular, the fact--and you had mentioned earlier, and I am 
very pleased to hear that now we have search-and-rescue teams 
that can be anywhere within 4 hours, almost anywhere in the 
country.
    I think that speaks a lot to our enhanced capabilities. But 
I think we always are never certain what that next threat will 
be coming, and the fact that this country could be attacked 
once again, as we were on 9/11. So we have to continue to stay 
on top of this, and make sure we are using our resources to the 
best of our ability.
    So I would like to remind the Members of the committee who 
might have additional questions for you, we are going to ask 
them to--you may be asked to respond in writing to those who 
couldn't be here. Pursuant to Committee Rule 7-E, the hearing 
record will be open for the next 10 days.
    Without objection, the committee stands adjourned and I 
thank you very much.
    [Whereupon, at 11:34 a.m., the subcommittee was adjourned.]


                            A P P E N D I X

                              ----------                              

        Questions From Chairman Susan W. Brooks for Tim Manning
                           guidance to states
    Question 1. As I am sure you are aware, The Implementing 
Recommendations of the 9/11 Commission Act of 2007 requires the 
Department's Office of Inspector General (OIG) to audit individual 
States' management of State Homeland Security and UASI grants. I have 
had the chance to read the latest results of the Indiana and 
Massachusetts audits. Both of these reports echoed the findings of 
previous audits. Specifically, the OIG maintains that most States have 
not developed performance measures to document enhancements to 
preparedness resulting from the grant awards. In her written testimony 
submitted for today, Ms. Richards stated, ``Without performance 
monitoring, States cannot be certain they have met program goals and 
used funds to enhance capabilities, rather than wasting them by not 
addressing deficiencies.'' Can you please describe some of the things 
FEMA is doing to help States update their Homeland Security and Urban 
Area Security Initiative Strategies to include more meaningful 
performance measures?
    Answer. Response was not received at the time of publication.
                                 thira
    Question 2. Since our hearing almost exactly 1 year ago, FEMA has 
released its much-anticipated THIRA guidance. Some early feedback we've 
received is that the role of local government officials, local 
emergency managers, and first responders is not clear--such as how the 
threats and capability gaps identified at the local level will be 
included in the State THIRAs submitted to FEMA. In addition, Mr. Gruber 
said in his testimony last year before this subcommittee that FEMA's 
approach to measuring the effectiveness of grants will be tied to 
assessing the achievement of National priorities. My question is, as 
you look to evaluate the effectiveness of homeland security grants, how 
will you ensure that you are accounting for the benefits, or 
deficiencies, realized at the local level, where most of the incidents 
occur?
    Answer. Response was not received at the time of publication.
                           grants task force
    Question 3a. I have learned that FEMA has convened a task force to 
evaluate grants management processes and develop a series of 
recommendations to improve efficiencies, address gaps, and increase 
collaboration across regional and headquarters counterparts and 
financial and programmatic counterparts. Mr. Maurer referred to this 
task force in his written testimony. Can you please discuss the work of 
this task force as well as any recommendations that have come out of 
the task force?
    Answer. Response was not received at the time of publication.
    Question 3b. If recommendations are not yet available, can you 
please provide a time frame for when they might be ready?
    Answer. Response was not received at the time of publication.
                        draw-down of grant funds
    Question 4. The backlog in the spending of grant funds has been an 
issue for years. As of last month, FEMA reported that $5.2 billion in 
grant funds from fiscal years 2008 through 2011 has yet to be drawn 
down. Obviously, some of these grants are still within their period of 
performance, but some of them are well outside that time frame. What 
impact has FEMA's limitation on the issuance of extensions had on 
grantee's ability to spend grant funds within the prescribed time 
limit?
    We continue to hear that some reviews, such as the Environmental 
and Historic Preservation reviews, are causing delays in grantees' 
ability to draw down their funds, despite FEMA's efforts to expedite 
these processes. What is FEMA doing to further streamline and expedite 
review processes such as these to ensure that projects are in 
compliance, but are not delayed? What percentage of grant funds has 
been returned to the Treasury due to failure to expend all funds within 
the 5-year budgetary requirement?
    Answer. Response was not received at the time of publication.
                collection of project-level information
    Question 5a. IG and GAO reviews have noted that FEMA frequently 
lacks sufficient information on projects once grant funds leave the 
State level. I understand that FEMA is beginning to collect more 
project-level information. In their written testimony today, GAO re-
stated that visibility into project-level data was important, ``but 
that FEMA had not yet finalized data requirements or fully implemented 
the data system to collect the information.'' How will this new 
approach provide you with more visibility at the project level so you 
can be sure that funds are being used appropriately?
    Answer. Response was not received at the time of publication.
    Question 5b. Is FEMA ready to begin collecting additional project-
level information?
    Answer. Response was not received at the time of publication.
                           fema organization
    Question 6. Within your organization (Protection and National 
Preparedness) are the Grant Programs Directorate and the National 
Preparedness Assessment Division. The National Preparedness Assessment 
Division has the responsibility for developing measures and metrics for 
these grants. However, grants measurement seems to be handled by FEMA's 
policy shop. Why is grants measurement completed by a different 
division than that which develops grant policy and makes grant awards?
    Answer. Response was not received at the time of publication.
      Question from Chairman Susan W. Brooks for Anne L. Richards
                    examples of measures and metrics
    Question. Has either of you (GAO and/or IG) seen examples of other 
agencies within the Federal Government--or maybe oven at a State and 
local level--that is able to effectively measure grants? Can you please 
describe those to us?
    Answer. Response was not received at the time of publication.
      Questions From Chairman Susan W. Brooks for David C. Maurer
                    examples of measures and metrics
    Question 1. Has either of you (GAO and/or IG) seen examples of 
other agencies within the Federal Government--or maybe oven at a State 
and local level--that is able to effectively measure grants? Can you 
please describe those to us?
    Answer. Response was not received at the time of publication.
                         capability assessment
    Question 2a. GAO has repeatedly expressed concerns regarding FEMA's 
inability to assess National preparedness capabilities. In September 
and November 2011, FEMA issued the National Preparedness Goal and 
System, respectively, and in May 2012, FEMA issued its National 
Preparedness Report. To what extent do you think FEMA defines the 
capability requirements necessary for National preparedness?
    Answer. Response was not received at the time of publication.
    Question 2b. To what extent do you think FEMA's 2012 National 
Preparedness Report addresses GAO's historical concerns regarding the 
assessment of National capability gaps against National capability 
requirements?
    Answer. Response was not received at the time of publication.
    Question 2c. Given the work that has been completed to date, what 
remains to be done, in your view, to address GAO's historical concerns?
    Answer. Response was not received at the time of publication.

                                 
