Homeland Security: Management of First Responder Grant Programs  
Has Improved, but Challenges Remain (02-FEB-05, GAO-05-121).	 
                                                                 
The Office for Domestic Preparedness (ODP)--originally		 
established in 1998 within the Department of Justice to help	 
state and local first responders acquire specialized training and
equipment needed to respond to terrorist incidents--was 	 
transferred to the Department of Homeland Security upon its	 
creation in March 2003. After September 11, 2001, the scope and  
size of ODP's grant programs expanded. For example, from fiscal  
year 2001 through fiscal year 2003, ODP grants awarded to states 
and some urban areas grew from about $91 million to about $2.7	 
billion. This growth raised questions about the ability of ODP	 
and states to ensure that the domestic preparedness grant	 
programs--including statewide and urban area grants--are managed 
effectively and efficiently. GAO addressed (1) how statewide and 
urban area grants were administered in fiscal years 2002 and 2003
so that ODP could ensure that grant funds were spent in 	 
accordance with grant guidance and state preparedness planning	 
and (2) what time frames Congress and ODP established for	 
awarding and distributing grants, and how time frames affected	 
the grant cycle.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-05-121 					        
    ACCNO:   A16736						        
  TITLE:     Homeland Security: Management of First Responder Grant   
Programs Has Improved, but Challenges Remain			 
     DATE:   02/02/2005 
  SUBJECT:   Counterterrorism					 
	     Emergency preparedness				 
	     Federal aid to localities				 
	     Federal aid to states				 
	     Grant administration				 
	     Grants to states					 
	     National preparedness				 
	     Federal agency reorganization			 
	     Intergovernmental relations			 
	     Grant monitoring					 
	     Grants to local governments			 
	     First responders					 
	     DHS Urban Area Security Initiative 		 
	     State Homeland Security Grant Programs		 

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GAO-05-121

                 United States Government Accountability Office

Report to the Chairman, Committee on

GAO

                    Appropriations, House of Representatives

February 2005

HOMELAND SECURITY

Management of First Responder Grant Programs Has Improved, but Challenges Remain

GAO-05-121  

HOMELAND SECURITY

Management of First Responder Grant Programs Has Improved, but Challenges
Remain

  What GAO Found

ODP has established and refined grant award procedures for states and
localities to improve accountability in state preparedness planning. For
fiscal years 2002 and 2003, ODP developed procedures and guidelines for
awarding statewide and urban area grants to states and for determining how
states and localities could expend funds and seek reimbursement for first
responder equipment or services. ODP gave states flexibility by allowing
them to determine how grant funds were to be managed and distributed
within their states. In fiscal year 2003, ODP required states to update
homeland security strategies and related needs assessments prepared in
earlier years. These efforts are intended to guide states and localities
in targeting grant funds. ODP also took steps to improve grant oversight
procedures. Finally, to help meet mandates contained in a presidential
directive, ODP has begun drafting national preparedness standards to
identify and assess gaps in first responder capabilities on a national
basis.

Congress and ODP have acted to expedite grant awards by setting time
limits for grant application, award, and distribution processes. For
fiscal year 2002 through February 2003, the appropriations statutes did
not require ODP to award grant funds to states within a specific time
frame. Then, in April 2003, the supplemental appropriations act imposed
new deadlines on ODP and the states. As a result, ODP reported that all
states submitted grant applications within the mandated 30 days of the
grant announcement, and that over 90 percent of grants were awarded within
the mandated 15 days of receipt of the applications. ODP also took steps
to expedite the transfer of funds from states to local jurisdictions.
Nevertheless, the ability of states and localities to spend grant funds
expeditiously was complicated by the need to adhere to various legal and
procurement requirements. ODP is identifying best practices to help states
address the issue.

In reviewing a draft of the report, the Department of Homeland Security
generally agreed with GAO's findings; however, it questioned whether the
report's title adequately reflected the agency's progress in meeting grant
management challenges.

United States Government Accountability Office

Contents

Letter 1
Results in Brief 4
Background  5
ODP Established Grant Award Procedures for States and Localities   That
Support Efforts to Improve Accountability in State   Preparedness Planning
     9
Congress, ODP, States, and Localities Have Acted to Expedite  Grant
Awards, but Challenges Remain  24
Concluding Observations 30
Agency Comments and Our Evaluation  31
Appendix IV Comments from the Department of Homeland Security 45
Appendix V Related GAO Products Appendix VI GAO Contacts and Staff
Acknowledgments 49
GAO Contacts 49
Staff Acknowledgments 49

Appendix I Scope and Methodology

Appendix II  Fiscal Years 2002 and 2003 SDPP/SHSGP and UASI Funding and
Draw Downs by State

Appendix III Grant Award, Distribution, and Reimbursement Process for
Selected States and Local Jurisdictions

Tables  
              Table 1: ODP Grant Program Funding for Fiscal Years 2002 and 
           2003                                                             7 
             Table 2: Appropriations Acts for Fiscal Years 2002 and 2003   
                     SDPP/SHSGP and UASI I and II Grant Programs            9 
             Table 3: Fiscal Year 2002 State Domestic Preparedness Program 
                       (SDPP) and Fiscal Year 2003 State Homeland Security 
                       Grant Programs (SHSGP) Funding and Draw Downs as of 
           July 31, 2004                                                   36 
                 Table 4: Fiscal Year 2003 Urban Areas Security Initiative 
                                                                  (UASI) I 
                   and II Grant Funding and Draw Downs as of July 31, 2004 38 
Figures                                                                 
                Figure 1: ODP and OC Grant Management and Monitoring        6 
           Figure 2: SDPP/SHSGP and UASI II Grant Award, Distribution, and 
                     Reimbursement Processes for First Responder Equipment 11 
              Figure 3: State Homeland Security Assessment and Strategy    
                    Development Process for Fiscal Years 1999 through 2003 14 
             Figure 4: Key Dates Associated with FY 2002 State Domestic    
                       Preparedness Program Grant Distribution for State A 40 
             Figure 5: Key Dates Associated with FY 2002 State Domestic    
                       Preparedness Program Grant Distribution for State B 41 
             Figure 6: Key Dates Associated with FY 2003 State Homeland    
                   Security Grant Program I Grant Distribution for State B 42 
             Figure 7: Key Dates Associated with FY 2003 State Homeland    
                  Security Grant Program II Grant Distribution for State B 43 
             Figure 8: Key Dates Associated with FY 2003 State Homeland    
                   Security Grant Program I Grant Distribution for State C 44 

Abbreviations

CBRNE            chemical, biological, radiological, nuclear, or explosive 
DHS           Department of Homeland Security                              
GAO           Government Accountability Office                             
HSPD-8        Homeland Security Presidential Directive-8                   
IG            Inspector General                                            
ISIP          Initial Strategy Implementation Plans                        
MOU           memorandum of understanding                                  
OC            Office of the Comptroller                                    
ODP           Office for Domestic Preparedness                             
OJP           Office of Justice Programs                                   
SDPP          State Domestic Preparedness Program                          
SHSGP         State Homeland Security Grant Program                        
SLGCP              Office of State and Local Government Coordination and   
                 Preparedness                                                 
UASI          Urban Areas Security Initiative                              

This is a work of the U.S. government and is not subject to copyright
protection in the United States. It may be reproduced and distributed in
its entirety without further permission from GAO. However, because this
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copyright holder may be necessary if you wish to reproduce this material
separately.

United States Government Accountability Office Washington, DC 20548

February 2, 2005  

The Honorable Jerry Lewis Chairman  Committee on Appropriations House of
Representatives

Dear Mr. Chairman:  

The terrorist attacks of September 11, 2001, placed enormous demands  upon
the capacities of state and local police and fire departments,  emergency
medical and public health services, and other first responders.  After the
attacks, Congress, federal agencies, state and local governments,  and a
range of independent research organizations acknowledged that  additional
resources and intergovernmental coordination were needed to  ensure that
state and local first responders would be better prepared to  respond to
future domestic terrorist threats or attacks.

The Department of Justice established the Office for Domestic
    Preparedness (ODP) in 1998 within the Office of Justice Programs (OJP)
    to assist state and local first responders in acquiring specialized
training  and equipment needed to respond to and manage terrorist
incidents  involving weapons of mass destruction. ODP, which was
transferred to the  Department of Homeland Security (DHS) upon its
creation in March 2003, 1  has been a principal source of domestic
preparedness grant funds. 2 These grants are a means of achieving an
important goal-enhancing the ability  of first responders to prevent,
prepare for, respond to, and recover from  terrorist incidents with
well-planned and well-coordinated efforts that  involve police, fire,
emergency medical, public health, and other personnel  from multiple
jurisdictions. Since the events of September 11, the amount  of grant
funds awarded and managed by ODP has grown significantly. For  example, in
fiscal year 2001, ODP awarded about $91 million in domestic  preparedness
grants. In fiscal year 2003, ODP awarded about $2.1 billion  through its
State Homeland Security Grant Programs (SHSGP) I and II and  an additional
$596 million for Urban Areas Security Initiative (UASI)  

1

Homeland Security Act of 2002 S: 403(5), 6 U.S.C. S: 203(5) (Supp. 2002).

2

Grant funds for domestic preparedness programs for state and local
governments are also provided by other DHS components and other agencies,
including the Departments of Justice and Health and Human Services.

    Page 1 GAO-05-121 Homeland Security

grants I and II. 3 The scope of ODP's grant programs expanded as well,
from funding only first responder equipment in fiscal year 2001 to funding
a range of preparedness planning activities, exercises, training,
equipment purchases, and related administrative costs in fiscal year 2003.

In your request, you raised questions about how, given the growth in
funding, ODP, states, 4 and local jurisdictions work together to ensure
that grant funds are spent in accordance with both ODP's grant guidance
and the state and urban area homeland security strategies that ODP
required states to develop as a condition of receiving grant funds. In
response to your request, we first briefed your office on ODP's structure
and processes for program and financial management of its grants and its
monitoring policies and processes. In this report, we address two other
issues:

(1) How were SHSGP and UASI grants administered in fiscal years 2002 and
2003 so that ODP could ensure that grant funds were spent in accordance
with grant guidance and state preparedness planning? (2) What time frames
did Congress and ODP establish for awarding and distributing grants, and
how did these time frames affect the grant cycle?

In addition to this work, we have recently issued other reports and
delivered congressional testimonies on issues relating to federal funding
and oversight of grants for first responders, which include ODP grants as
well as grants from other federal sources. Among other things, we reported
that a major challenge in managing first responder grants is balancing two
goals: (1) minimizing the time it takes to distribute grant funds to state
and local first responders and (2) ensuring appropriate planning and
accountability for effective use of the funds. 5 (See appendix V for the
list of Related GAO Products.)

3

SHSGP I and II grants are formula grants that provide each state a minimum
base amount plus an additional amount based on the state's population.
UASI I and II grants are awarded to selected urban areas across the nation
on the basis of such factors as population density, critical
infrastructure, and current threat estimates. In fiscal year 2003, SHSGP
and UASI grant programs were designated as I or II because they were
funded by different appropriations in the same fiscal year.

4

For this report, the term "states" refers to the 50 states; the District
of Columbia; the Commonwealths of Puerto Rico and the Northern Mariana
Islands; American Samoa; Guam; and the U.S. Virgin Islands.

5

See GAO, Emergency Preparedness: Federal Funds for First Responders,
GAO-04-788T (Washington, D.C.: May 13, 2004).

To address the objectives in this report, we met with officials from ODP
and selected states and local jurisdictions to obtain information about
the grant management process. 6 We identified 25 domestic preparedness
grant programs managed by ODP in fiscal years 2002 and 2003, 7 and for our
detailed review, we selected the five largest in terms of federal funding
provided to state and local jurisdictions. As part of our review, we also
selected five states (Arizona, California, Florida, Missouri, and
Pennsylvania) and 19 local jurisdictions within those states that have
received state and urban area grants. The five states were selected on the
basis of the amount of ODP grant funding received, population size, and
other factors. The local jurisdictions were selected for a more detailed
analysis of grant administration. We collected and analyzed grant data
from ODP. Specifically, we obtained and analyzed data from ODP on the time
frames associated with the grant award and distribution processes. We
reviewed these data for obvious inconsistency errors and completeness and
compared these data for the five selected states with hard-copy documents
we obtained from these states. When we found discrepancies, we brought
them to the attention of ODP and state and local officials and worked with
them to correct the discrepancies before conducting our analyses. In
addition, we obtained and analyzed data on the number of ODP's
office-based and on-site monitoring reviews conducted in fiscal year 2004.
We also reviewed these data for obvious inconsistency errors and
completeness and compared these data with onsite monitoring reports
prepared and provided by ODP. From these assessments, we determined that
the grant data were sufficiently reliable for the purposes of this report.

We also reviewed relevant reports and studies on homeland security and
domestic preparedness. We conducted our work from November 2003 through
November 2004 in accordance with generally accepted government auditing
standards. (See appendix I for more details on our scope and methodology.)

6

In this report, the terms "local jurisdictions" and "localities" are used
interchangeably to refer to diverse political and governmental entities,
such as counties, cities, towns, municipalities, Indian tribes, and
others.

7

In addition to SDPP and SHSGP and UASI I and II grant programs, some of
the other grant programs are for the same or similar purposes and are
counted as separate grants because they are funded by separate
appropriations in different years.

Page 3 GAO-05-121 Homeland Security

  Results in Brief

ODP has established and refined grant award procedures for states and
localities that have supported efforts to improve accountability in the
state preparedness planning process. For fiscal years 2002 and 2003, ODP
developed procedures and guidelines for awarding SHSGP and UASI grants to
states and for determining how states and localities could expend funds
and seek reimbursement for first responder equipment or services they
purchased. As part of this process, ODP gave states flexibility by
allowing them to determine how grant funds were to be managed and
distributed within their states and whether purchases would be made
locally or at the state level. In fiscal year 2003, ODP also required
states to update homeland security strategies and related needs
assessments prepared in earlier years. These strategies are intended to
guide state and local jurisdictions in targeting grant funds. As directed
by statute, ODP required states to submit these updated strategies to ODP
for approval in order to receive fiscal year 2004 grant funds. In tandem
with this effort, ODP revised its grant-reporting method, moving away from
requiring states, localities, and urban areas to submit itemized lists of
first responder equipment they plan to purchase toward a more
results-based approach, whereby grant managers at all levels must
demonstrate how grant expenditures are linked to larger projects that
support goals in the states' homeland security strategies. ODP also took
steps to improve grant oversight procedures in part by setting new goals
in fiscal year 2004 for monitoring states' progress toward meeting
preparedness goals and objectives in their homeland security strategies.
ODP planned to visit all 56 grantees at least once a year. ODP completed
44 of 56 planned visits to grantees in fiscal year 2004. In addition, ODP
cited staffing challenges in filling all of its authorized positions,
which have affected grant management; ODP has worked to fill federal
vacancies. ODP also is addressing concerns that some states have about the
accuracy of the needs assessments upon which the fiscal year 2003 state
homeland security strategies are based, citing, among other things, a
mismatch between local jurisdictions' estimates of need and the states'
estimates. Finally, as part of a broader effort to meet mandates contained
in a presidential directive, ODP has begun drafting national preparedness
standards to identify and assess gaps in first responder capabilities on a
national basis.

Congress, ODP, states, and localities have acted to expedite grant awards
by setting time limits for the grant application, award, and distribution
processes and by instituting other procedures. For all of fiscal year 2002
through February 2003, the appropriations statutes did not require ODP to
award grant funds to states within a specific time frame. For fiscal year
2002, ODP took roughly 4 months to make applications available to states.

Page 4 GAO-05-121 Homeland Security

In April 2003, the supplemental appropriations act imposed new deadlines
on ODP and the states. As a result, ODP made the grant application
available within the mandated 15 days of the congressional appropriation
for the grant cycle, and all states returned their applications within 30
days of the grant announcement. ODP reported that over 90 percent of grant
awards were made to the states within 14 days of receipt of state
applications. ODP also took steps to expedite the transfer of funds from
states to local jurisdictions, allowing states, for example, to transfer
grants to localities before all required grant application documentation
had been submitted to ODP. Nevertheless, the ability of states and
localities to spend grant funds expeditiously was complicated by the need
to adhere to state and local legal and procurement requirements and
approval processes, which in some cases added months to the purchasing
process. Some states have modified their procurement practices, and ODP is
identifying best practices to aid in the effort.

After reviewing a draft of this report, DHS generally agreed with our
findings and provided technical comments, which were incorporated as
appropriate. The agency also expressed the view that progress made in
addressing challenges related to managing first responder grant programs
was not appropriately reflected in the report's title. We disagree. The
agency's comments are in appendix IV.

When DHS was created in March 2003, ODP was transferred from the

Justice Department's OJP to DHS's Directorate of Border and Transportation
Security. In March 2004, the Secretary of Homeland Security consolidated
ODP with the Office of State and Local Government Coordination to form the
Office of State and Local Government Coordination and Preparedness
(SLGCP). 8 In addition, other preparedness grant programs from agencies
within DHS were transferred to SLGCP. 9 SLGCP, which reports directly to
the Secretary, was created to provide a "one-stop shop" for the numerous
federal preparedness initiatives applicable to state and local first
responders. As shown in figure 1, while

8

For the purpose of this report, we cite ODP in discussing the first
responder grant management functions of SLGCP.

9

Among the grant programs transferred were the following: Assistance to
Firefighters Grant Program, Citizen Corps Program, and Emergency
Management Performance Grants from the Federal Emergency Management Agency
within the Emergency Preparedness and Response Directorate; and Port
Security Grant Program from the Transportation Security Administration
within the Border and Transportation Security Directorate. In addition, a
new program, the Law Enforcement Terrorism Prevention Program, was
initiated in SLGCP.

SLGCP/ODP has program management and monitoring responsibility for
domestic preparedness grants, it relies upon the Justice Department's
Office of the Comptroller (OC) for grant fund distribution and assistance
with financial management support, which includes financial monitoring.

              Figure 1: ODP and OC Grant Management and Monitoring

Source: GAO based on ODP and OC data. Copyright (c) Corel Corp. all rights
reserved (image).

Within ODP, the Preparedness Programs Division (formerly the State and
Local Program Management Division) is specifically tasked with enhancing
the capability of state and local emergency responders to prevent, deter,
respond to, and recover from terrorist attacks involving the use of
chemical, biological, radiological, nuclear, or explosive (CBRNE) weapons.
For these purposes, ODP provides grant funds to the 50 states, the
District of Columbia, the Commonwealths of Puerto Rico and the Northern
Mariana Islands, American Samoa, the Virgin Islands, Guam, and selected
urban areas. In addition to this grant funding for specialized equipment
and other purposes, ODP provides direct training, exercises, technical
assistance, and other counterterrorism expertise.

Program Funding and During fiscal years 2002 and 2003, ODP managed 25
grant programs Allocation for Fiscal Years totaling approximately $3.5
billion. About $2.98 billion (85 percent) of the total ODP grant funds for
both years was for statewide grants-the State

    2002 and 2003

Domestic Preparedness Program (SDPP), which is a predecessor grant program
to SHSGP, and SHSGP I and II-and grants targeted at selected urban areas
(UASI I and II). The SDPP/SHSGP grant funds accounted for about 68 percent
($2.38 billion) and the UASI I and II grant funds about 17 percent ($596
million). Table 1 shows the amounts provided for these and other ODP
grants.

       Table 1: ODP Grant Program Funding for Fiscal Years 2002 and 2003

                              Dollars in thousands

Percent of total Grant program 2002 2003 Total funding

a

                           SDPP $315,700 $315,700 9.1

a

SHSGP I $566,295 566,295

a

SHSGP II 1,500,000 1,500,000

Total SDPP/SHSGP 315, 700 2,066,295 2,381,995

a

UASI I 96,351 96,351

a

UASI II 500,000 500,000

a

Total UASI I and II 596,351 596,351

Total SDPP/SHSGP and UASI I and II 315, 700 2,662,646 2,978,346

UASI-other 190,000c 190,000

Other grants 119,979b 198,081d 318,060

      Total $435,679 $3,050,727 $3,486,406

Source: ODP.

a

Program not funded in this year.

b

Includes the following five grant programs: Law Enforcement Enhancement
Program, New York Equipment Replacement Program, National Domestic
Preparedness Consortium, Homeland Defense Equipment Reuse Program Pilot
Project Support Grant, and Domestic Preparedness Training and Technical
Assistance Program-St. Petersburg College.

Includes the following four grant programs: the UASI Port Security Grant
Program, UASI Transit Security Grant Program, UASI Pilot Projects, and
UASI Radiological Defense System.

d

Includes the following 11 grant programs: Counterterrorism Institute Grant
Program, TOPOFF II, Washington Metropolitan Area Transit Authority,
Airborne Imaging in Support of Emergency Operations, Testing and
Evaluation of Emergency Response Equipment, Terrorism Early Alert and
Strategic Planning System, Homeland Defense Equipment Reuse Program,
Northern Virginia Emergency Response Coalition Grant Program, Domestic
Preparedness Equipment Training and Technical Assistance Program, National
Domestic Preparedness Consortium, and Multistate Anti-Terrorism
Information Exchange Project.

See appendix II for the SDPP/SHSGP grant funding awarded in fiscal years
2002 and 2003 and the UASI I and II grant funding awarded in fiscal year
2003.

The SDPP/SHSGP grant programs expanded from funding equipment, exercises,
and administrative activities in fiscal year 2002 to include, in fiscal
year 2003, the cost of planning and training. The SDPP generally provided
funding for advanced equipment, 10 exercises, and administrative
activities. The SHSGP I provided, among other things, funding for
specialized equipment, exercises, training, and planning and
administrative costs. From a separate appropriation, the SHSGP II
supplemented funding available through SHSGP I for basically the same
purposes, but included separate funding for critical infrastructure
protection. The SDPP/SHSGP grant funds were distributed using a base
amount of 0.75 percent of the total allocation to each state, the District
of Columbia, and the Commonwealth of Puerto Rico, and 0.25 percent of the
total allocation to the Commonwealth of the Northern Mariana Islands,
American Samoa, Guam, and the Virgin Islands, with the balance being
distributed on a population-share basis. The UASI I grant funds were
provided directly to seven selected urban areas to address the unique
equipment, training, planning, and exercise needs of large high-threat
urban areas and specifically, to assist in building an enhanced and
sustainable capacity to prevent, respond, and recover from threats or acts
of terrorism. From a separate appropriation, UASI II provided funding
through the states (not directly) to 30 selected urban areas for basically
the same purposes. 11 The UASI grant funds were awarded on the basis of
the following factors: population density, critical infrastructure, and
current threat estimates. 12 (See appendix II for the urban areas that
received UASI I and II grant funds.) Table 2 shows the funding authority
for these grant programs.

10

For the fiscal year 2002 SDPP, states and local jurisdictions were allowed
to acquire advanced levels of first responder equipment, including bomb
mitigation and remediation gear, remote sensing devices, and mass casualty
decontamination equipment.

11

In fiscal year 2004, 50 urban areas received UASI grant funding.

12

Each of these factors was weighted in a linear formula; the results were
ranked and used to calculate a proportional allocation of grant funds.

Page 8 GAO-05-121 Homeland Security

  ODP Established Grant Award Procedures for States and Localities That Support
  Efforts to Improve Accountability in State Preparedness Planning

Table 2: Appropriations Acts for Fiscal Years 2002 and 2003 SDPP/SHSGP and
UASI I and II Grant Programs

                                   2002 2003

Grant   Appropriations                       Appropriations  
program acts                  Date enacted   acts             Date enacted 
SDPP    Pub. L. No. 107-77a , Nov. 28, 2001,                 
            Pub. L. No. 107-117b Jan. 10, 2002                  
                                                Pub. L. No.                   
SHSGP I                                      108-7c          Feb. 20, 2003

SHSGP II                                Pub. L. No. 108-11d  Apr. 16, 2003 
UASI I                                   Pub. L. No. 108-7c  Feb. 20, 2003 
UASI II                                 Pub. L. No. 108-11d  Apr. 16, 2003 

Source: Congressional legislation.

a

Departments of Commerce, Justice, and State, the Judiciary, and Related
Agencies Appropriations Act, 2002.

b

Department of Defense and Emergency Supplemental Appropriations for
Recovery from and Response to Terrorist Attacks on the United States Act,
2002.

c

Consolidated Appropriations Resolution, 2003.

d

Emergency Wartime Supplemental Appropriations Act, 2003.

Over time, ODP has developed and modified its procedures for awarding
grants to states, governing how states distribute funds to local
jurisdictions, and facilitating reimbursements for states and localities
purchasing first responder equipment and services. ODP also developed
requirements intended to hold states and localities accountable for how
grant expenditures were planned, justified, expended, and tracked. These
accountability-related requirements evolved over time. For instance, prior
to fiscal year 2004, the states were primarily required to provide
information on the specific items they and localities planned to purchase
on the basis of ODP's evolving authorized equipment lists. In fiscal year
2004, to better determine the impact of expenditures on preparedness
efforts, ODP began placing more emphasis on results-based reporting of
planned and actual grant expenditures. ODP instituted new state and local
reporting requirements aimed at ensuring that grant expenditures would
align with goals and objectives contained in state and urban area homeland
security strategies. ODP also, over time, has stepped up its state
grant-monitoring activities.

    ODP Gave States Flexibility in Administering and Distributing Grants

For fiscal years 2002 and 2003, ODP developed procedures and guidelines
for awarding SDPP/SHSGP and UASI grants to states that enabled states to
distribute grant funds and states and localities to expend funds and seek
reimbursement for first responder equipment or services they purchased
directly. After enactment of appropriations for the grant programs, ODP
developed and made available program guidelines including the grant
application for each grant program. 13 With the exception of UASI I, once
a grant application was submitted to and approved by ODP, ODP awarded
grant funds directly to each state, which was required to designate a
state administrative agency to administer the grant funds. 14 States in
turn transferred or subgranted the funds to local jurisdictions 15 or
urban areas, with a designated core city and county/counties. For UASI I
grants, ODP awarded grant funds directly to selected urban areas (i.e.,
selected cities). Figure 2 illustrates the main steps involved in the
SDPP/SHSGP and UASI II grant cycle.

13

The applications are posted and must be submitted in OJP's Web-based
Grants Management System.

14

For UASI I, the Chief Executive of each city was required to designate a
program administering agency to administer the grant funds.

15

For SDPP and SHSGP I, states were required to provide 80 percent of their
funding allocations for equipment to local jurisdictions. States were
permitted to retain 20 percent of the equipment funds, and the
pass-through requirement did not apply to other components of the grants.
For SHSGP II and UASI II, states were required to provide at least 80
percent of the total grant funding for all permissible purposes
(equipment, exercises, training, and planning and administrative costs) to
local jurisdictions. States were permitted to retain up to 20 percent of
their total funding. For SHSGP II and UASI II, 3 percent of the total
grant award could be used for administrative purposes.

 Figure 2: SDPP/SHSGP and UASI II Grant Award, Distribution, and Reimbursement
                    Processes for First Responder Equipment

Grant award and distribution process Reimbursement process

Source: GAO analysis of ODP and selected states' data.

Note: The term "reimbursement" as used here includes the process by which
states and localities may request and receive federal funds to pay
invoices for goods or services before payment is due. Localities receive
their funds through the states, which request the funds on behalf of the
localities.

For SDPP/SHSGP grant programs, ODP allowed the states flexibility in
deciding how the grant programs were structured and implemented in their
states. In general, states were allowed to determine such things as the
following:

     o the formula for distributing grant funds to local jurisdictional
       units;
     o the definition of what constitutes a local jurisdiction eligible to
       receive funds, such as a multicounty area;
     o the organization or agency that would be designated to manage the
       grant program; and
     o whether the state or local jurisdictions would purchase grant-funded
       items for the local jurisdictions.

UASI I grantees, for the most part, have had flexibilities similar to
those of the states and could, in coordination with members of the Urban
Area Working Group, 16 designate contiguous jurisdictions to receive grant
funds. For UASI II, while the states subgranted the grant funds to
selected urban areas, states retained responsibility for administering the
grant program. The core city and county/counties worked with the state
administrative agency to define the geographic borders of the urban area
and coordinated with the Urban Area Working Group.

Once the grant funds were awarded to the states and then subgranted to the
local jurisdictions or urban areas, certain legal and procurement
requirements had to be met, such as a city council needing to approve
acceptance of grant awards. Once these requirements were satisfied,
states, local jurisdictions, and urban areas could then obligate their
funds for first responder equipment, exercises, training, and services.
Generally, when a local jurisdiction or urban area directly incurred an
expenditure for first responder equipment, it submitted related
procurement documents, such as invoices, to the state. The state would
then draw down the funds from the Justice Department's OJP. According to
OJP, funds from the U.S. Treasury were usually deposited with the states'
financial

The Urban Area Working Group consists of points of contact from
jurisdictions within the defined urban area. The working group is
responsible for coordinating development and implementation of all program
elements within the area.

Page 12 GAO-05-121 Homeland Security

    States Updated Homeland Security Strategies to Guide Grant Spending, and ODP
    Revised Grant Reporting and Monitoring Procedures

institution within 48 hours. The states, in turn, provided the funds to
the local jurisdiction or urban area. 17

In addition to the guidelines ODP developed for the grant award,
distribution, and reimbursement process, ODP developed separate guidance
that required every state to develop a homeland security strategy as a
condition of receiving grant funds. Specifically, ODP required states to
develop homeland security strategies that would provide a roadmap of where
each state should target grant funds for fiscal years 1999 to 2001
(subsequently extended to fiscal year 2003). To assist the states in
developing these strategies, state agencies and local jurisdictions were
directed to conduct needs assessments on the basis of their own threat and
vulnerability assessments. The needs assessments were to include related
equipment, training, exercise, technical assistance, and research and
development needs. In addition, state and local officials were to identify
current and required capabilities of first responders to help determine
gaps in capabilities.

ODP directed the states in fiscal year 2003 to update their homeland
security strategies to better reflect post-September 11 realities and to
identify progress on the priorities originally outlined in the initial
strategies. 18 As with these initial strategies, the updated strategies
included goals and objectives the states wanted to achieve to meet
homeland security needs, such as upgrading emergency operations centers
and command posts. As directed by statute, ODP required completion and
approval of these updated strategies as a condition for awarding fiscal
year 2004 grant funds. As of July 2004, ODP had approved or conditionally
approved 19 all state strategies and awarded all fiscal year 2004 SHSGP

17

According to ODP officials, this process for the transfer of funds is
intended to allow for the use of federal monies to pay the bill, rather
than state or local funds. (For further discussion of steps taken by ODP
to expedite grant funding and remaining challenges, see pp. 23-30.)

18

In fiscal year 2003, the urban area grantees were required to prepare
jurisdictional needs assessments that would support the development of
urban area homeland security strategies. Twenty-five percent of the fiscal
year 2003 UASI I and II grant funds could be used prior to the submission
and approval of the urban area strategies to assist jurisdictions in
developing their strategies as well as for other purposes.

19

According to ODP, it conditionally approved some state strategies,
provided that all issues were addressed within a set time period. States
with conditionally approved strategies received their grant award but
could not draw down grant funds until their strategies were approved.
Among the reasons that ODP provided for conditional approvals were time
lines that were vague, missing, or too broad and not realistic; objectives
that did not tie in with the goals; and goals that were not well defined.

Page 13 GAO-05-121 Homeland Security

funds. 20 Figure 3 shows an overview of the state homeland security
assessment and strategy development process in place for fiscal years 1999
through 2003.

 Figure 3: State Homeland Security Assessment and Strategy Development Process
                       for Fiscal Years 1999 through 2003

Source: GAO based on ODP data. a

In fiscal year 2003, states and jurisdictions could also complete an
optional agricultural vulnerability assessment in addition to the
vulnerability assessment.

In conjunction with the development of the states' updated homeland
security strategies, ODP revised its approach to how states and localities
reported on grant spending and use. Specifically, ODP took steps to shift
the emphasis away from reporting on specific items purchased and toward
results-based reporting on the impact of states' expenditures on
preparedness. ODP maintains a list of authorized items that all states and

20

As part of ODP's fiscal year 2003 State Homeland Security Assessment and
Strategy Program, states were instructed to prepare new homeland security
strategies using an electronic template provided by ODP. The aggregated
results from the local jurisdiction needs assessment were automatically
populated in data fields in the state homeland security strategy template.
These data fields included, for example, the total number of potential
threat elements in the state, the number of jurisdictions facing
vulnerabilities from various hazards and their grouped ranking from low to
high risk, and the total equipment needs for nine categories of equipment.
State program managers completed the other sections of the strategy
template that described the state's vision, focus, goals and objectives,
jurisdictional prioritizations, and implementation steps.

localities were required to use as a guideline for making purchases. This
evolving list, comprising hundreds of first responder items, is arranged
by category, such as personal protection equipment; explosive device
mitigation and remediation equipment; CBRNE search and rescue equipment;
interoperable communications equipment; and more. Under this arrangement,
states and localities consulted ODP's authorized equipment list and
selected the equipment and quantity they planned to purchase-including
such diverse items as personal protection suits for dealing with hazardous
materials and contamination, bomb response vehicles, and medical supplies.
This information is in turn listed on itemized budget detail worksheets
that localities submitted to states for their review. Prior to the fiscal
year 2004 grant cycle, states submitted the worksheets to ODP. States also
compared purchased items against these worksheets when approving
reimbursements to localities.

According to ODP, this list-based reporting method made it difficult to
track the cumulative impact of individual expenditures on the goals and
objectives in a state's and urban area's homeland security strategy. While
the budget detail worksheets reflected the number and cost of specific
items that states and localities planned to purchase, neither states nor
ODP had a reporting mechanism to specifically assess how well these
purchases would, in the aggregate, meet preparedness planning needs or
priorities, or the goals and objectives contained in state or urban area
homeland security strategies. To help remedy this situation, ODP revised
its approach for fiscal year 2004. Rather than being required to submit
budget detail worksheets to ODP, 21 states, urban areas, and local
jurisdictions were required instead to submit new Initial Strategy
Implementation Plans (ISIP). These ISIPs are intended to show how planned
grant expenditures for all funds received are linked to one or more larger
projects, which in turn support specific goals and objectives in either a
state or urban area homeland security strategy. The state administrative
agency is responsible for submission of all ISIPs to ODP within 60 days of
the state's grant award. 22 The final submission is to include one ISIP
from the state administrative agency if the agency retains a portion of
the funding, and one ISIP for every local jurisdiction, state

21

 The budget detail worksheets are to be maintained by the state administrative
                                    agency.

22

The agency is also responsible for reviewing all completed ISIPs prior to
submitting them to ODP.

Page 15 GAO-05-121 Homeland Security

    ODP, State, and Local Officials Expressed Concerns about the 2003 Needs
    Assessments

agency, or nongovernmental organization receiving grant funds. ODP said
that almost all of the states have submitted their ISIPs. 23

In addition to the ISIPs, ODP now requires the states to submit biannual
strategy implementation reports showing how the actual expenditure of
grant funds at both the state and local levels was linked by projects to
the goals and objectives in the state and urban area strategy. According
to ODP, this reporting process is intended to better enable states and ODP
to track grant expenditures from all funding sources against state and
urban area homeland security strategies as well as collect critical
project output and performance data. The first biannual strategy
implementation reports covering the 6-month period ending December 31,
2004, were due to ODP on January 31, 2005. At the time of our review, it
was too early to determine whether the new approach would improve
expenditure tracking and performance reporting.

While progress has been made in updating state homeland security
strategies and planned improvements for reporting and tracking
grantrelated expenditures are under way, some federal, state, and local
officials expressed concerns about the accuracy of the needs assessments
on which the state strategies were based. When ODP instructed states and
local jurisdictions to update their fiscal year 1999 needs assessments in
fiscal year 2003, the agency told them not to constrain their estimates of
needs to a specific period of time or take potential sources of funding
into account. At the same time, ODP instructed states to review and
analyze local jurisdictions' needs assessments and the aggregated results
before submitting their needs assessment data to ODP. The needs
assessments for equipment received by ODP from 56 states and territories
as a result of this process totaled $352.6 billion. By contrast, the
funding available for SHSGP I and II in fiscal year 2003 totaled roughly
$2.1 billion.

State and local officials in three of the five states we visited cited
concerns about the accuracy of the needs assessments for their individual
states. For example, the needs assessment for one state we reviewed
amounted to about $11.8 billion-nearly 300 times the $39.5 million in
total state homeland security grant funds awarded to the state in fiscal
year 2003.

23

According to ODP, as of September 30, 2004, 19 states and territories
submitted their ISIPs by the due date, 35 were submitted late, and 2 had
not been submitted. Of the two that had not been submitted, one was late,
and one was not due to be submitted as of that date.

Page 16 GAO-05-121 Homeland Security

Grant managers in this state said that they had reviewed the local
jurisdictions' threat estimates and determined that, because of a
misinterpretation of the term "threat" by local officials, the number of
critical assets needing protection was higher than estimated by the state.
In their opinion, the local jurisdictions included items in their needs
assessments that were not needed to protect the state's critical assets.
Nevertheless, state officials did not revise the aggregated needs
assessment estimates included in their state strategy. ODP conditionally
approved the strategy for this state, noting, among other things, a
"disconnect" between the state's mission and goals and that time lines
were "too broad" and "not realistic." 24 Grant managers in a second state
said that the state did not base its strategy on the needs assessments
prepared by the local jurisdictions, in part, because they judged the
unconstrained assessments for equipment to be unrealistically high-
approximately $13 billion over an open-ended, multiyear period. While the
state submitted the total of these local assessments to ODP; it submitted
a strategy on the basis of its own planning procedures for 1 year only,
resulting in a $92 million estimate of needs. After discussions with ODP,
the state later submitted a broader, multiyear $9.6 billion needs
assessment for equipment.

ODP has taken steps to address its concerns, and some states' concerns,
related to the estimates included in the needs assessments. In a
conference held with state officials in March 2004, ODP personnel
discussed concerns that arose from their review of aggregated needs
assessment data and identified some possible sources of the problems. They
determined that, before submitting their fiscal year 2003 needs
assessments to ODP, states might not have adequately considered such
factors as mutual aid agreements for first responder assistance within
jurisdictions or whether jurisdictions within a region could share
resources, rather than submit separate or overlapping requests for first
responder equipment. 25 In response, ODP requested the states to validate
and revise, if necessary, the needs assessment data to take these factors
into account and to resubmit their assessments. States were to submit
their validated assessments to ODP by October 15, 2004. According to an

ODP approved the state strategy in August 2004.

25See GAO, U.S. Infrastructure: Agencies' Approaches to Developing
Investment Estimates Vary, GAO-01-835 (Washington, D.C.: July 20, 2001).
This report describes best practices followed by agencies in performing
needs assessments in the area of public infrastructure, such as
considering alternatives ways to address needs.

Page 17 GAO-05-121 Homeland Security

    ODP Has Begun Drafting National Preparedness Standards to Better Assess
    First Responder Needs

ODP document, ODP is currently completing its analysis of the assessment
data.

In addition to the issues raised about the accuracy of the fiscal year
2003 needs assessments, other factors may affect ODP's and states'
abilities to identify and assess first responder needs and priorities. For
example, according to some state officials we interviewed as well as
recent reports by DHS's Office of Inspector General (IG) 26 and the House
Select Committee on Homeland Security, 27 efforts by state and local
jurisdictions to prioritize expenditures to enhance first responder
preparedness have been hindered by the lack of clear guidance in defining
the appropriate level of preparedness and setting priorities to achieve
it.

Additionally, in our recent report on the management of first responder
grants in the National Capital Region, we reported that the lack of
national preparedness standards that could be used to assess existing
first responder capacities (such as the number of persons per hour that
could be decontaminated after a chemical attack), identify gaps in those
capacities, and measure progress in achieving specific performance goals
was a challenge. 28 We also reported that effectively managing federal
first responder grant funds requires the ability to measure progress and
provide accountability for the use of public funds. This required a
coordinated strategic plan for enhancing preparedness, performance
standards to guide how funds are used to enhance first responder
capacities and preparedness, and data on funds available and spent on
first responder needs.

National performance standards for assessing domestic preparedness
capabilities and identifying gaps in those capabilities that reflect
post-September 11 priorities are being developed. ODP has submitted to the
Secretary of DHS a definition of a national preparedness goal that is
intended to provide assurance of the nation's capability to prevent,
prepare for, respond to, and recover from major events, especially

26

Department of Homeland Security: Office of Inspector General, An Audit of
Distributing and Spending "First Responder" Grant Funds, OIG-04-15
(Washington, D.C.: March 2004).

27

House Select Committee on Homeland Security, An Analysis of First
Responder Grant Funding (Washington, D.C.: April 2004).

28See GAO, Homeland Security: Management of First Responder Grants in the
National Capital Region Reflects the Need for Coordinated Planning and
Performance Goals , GAO 04-443 (Washington, D.C.: May 28, 2004).

terrorism. ODP plans call for achieving the full capability needed to
sustain the preparedness levels required by the new national standards by
September 2008. In order to develop performance standards that will allow
ODP to measure the nation's success in achieving this goal, ODP is using a
capabilities-based planning approach-one that defines the capabilities
required by states and local jurisdictions to respond effectively to
likely threats. These capability requirements are to establish the minimum
levels of capability required to provide a reasonable assurance of success
against a standardized set of 15 scenarios for threats and hazards of
national significance. 29

ODP's efforts to develop national preparedness standards are, in part, a
response to Homeland Security Presidential Directive-8 (HSPD-8), issued by
the President in December 2003. HSPD-8 called for a new national
preparedness goal and performance measures, standards for preparedness
assessments and strategies, and a system for assessing the nation's
overall preparedness. 30 The directive required the DHS Secretary to
submit the new national preparedness goal to the President through his
Homeland Security Council for review and approval prior to, or
concurrently with, DHS's fiscal year 2006 budget submission to the Office
of Management and Budget in September 2004. 31 HSPD-8 also requires the
preparation and approval of statewide, comprehensive all-hazards
preparedness strategies in order to receive federal preparedness
assistance at all levels of government, including grants, after fiscal
year 2005.

As part of the HSPD-8 implementation process, ODP plans to develop a list
of capability requirements by the end of January 2005 in keeping with the

29

The interagency working group under the direction of the White House
Homeland Security Council developed these scenarios. They involve a
variety of potential emergencies, including four chemical (including both
chemical warfare and toxic industrial chemicals), three biological
(including both contagious and noncontagious agents and pandemic
influenza), two agricultural (including food safety and animal disease),
two natural disasters (a catastrophic earthquake and major hurricane), one
radiological, one nuclear, one improvised explosive device, and one cyber
attack.

30

HSPD-8 also requires that the preparedness goal pertain to "all hazards,"
addressing the nation's readiness to respond to all major events,
including natural disasters as well as acts of terrorism.

31

The recently enacted fiscal year 2005 DHS appropriation legislation, Pub.
L. No. 108-334 (2004), included other deadlines relative to HSPD-8, such
as the requirement that final guidance on the implementation of the
national preparedness goal be issued by March 31, 2005.

    ODP Increased Grant Monitoring Activities for Fiscal Year 2004 but Did Not
    Meet Its Monitoring Goal for All States

fiscal year 2005 DHS appropriations act. 32 To help define the
capabilities that jurisdictions should set as targets, ODP first drafted a
list of tasks required to prevent or respond to incidents of national
consequence. They include such generic tasks as integrating private-sector
entities into incident response activities or coordinating housing
assistance for disaster victims. The list of target capabilities includes
the policies, procedures, personnel, training, equipment, and mutual aid
arrangements needed to perform the tasks required to prevent or respond to
the national planning scenarios. ODP further plans to develop performance
measures, on the basis of the target capability standards that define the
minimal acceptable proficiency required in performing the tasks outlined
in the task list. ODP plans to complete initial development of the
performance measures by March 2005 and to refine them subsequently.
According to ODP's plan, the measures will allow the development of a
rating methodology that incorporates preparedness resources and
information about overall performance into a summary report that
represents a jurisdiction's or agency's ability to perform essential
prevention, response, or recovery tasks. The office acknowledges that this
schedule may result in a product that requires future incremental
refinements but has concluded that this is preferable to spending years
attempting to develop a "perfect" process. ODP held a workshop in
mid-October 2004 to obtain input from representatives from states,
national associations, and other federal departments and agencies
regarding the implementation of HSPD-8. At the workshop, some participants
voiced concerns that the process, among other things, was moving too fast
and did not consider the state and local needs assessments that had
already been done. In addition, some participants believed that better
communication and a more collaborative process was needed. ODP officials
promised to address the participants' concerns and asked for additional
input on how ODP could better implement the process and work better with
state and local jurisdictions.

ODP has taken steps to improve its oversight procedures with respect to
state, urban area, and local grantees. ODP is responsible for ensuring
administrative and programmatic compliance with relevant statutes,
regulations, policies, and guidelines of the grants it manages. ODP also
monitors the progress that states make toward the goals and objectives
contained in their homeland security strategies. Prior to September 11,

32

The act requires ODP to provide state and local jurisdictions with
nationally accepted first responder preparedness levels no later than
January 31, 2005.

Page 20 GAO-05-121 Homeland Security

2001, ODP formally monitored grantees through such activities as
officebased reviews at ODP of grantees' financial reports and other
documents, followed by on-site visits to state grant officials.
Office-based reviews entail a review of grant files to ensure that all
grant documentation is complete and up-to-date and that any apparent
problems are addressed through follow-up telephone or e-mail contact with
the state or urban area. Upon completion of an office-based review, an ODP
preparedness officer prepares a memorandum for the file. This review
usually takes place before an on-site visit is scheduled, according to
ODP. During an on-site visit, an ODP preparedness officer is to discuss
administrative and financial issues and programmatic issues such as
whether the state or urban area is meeting the goals and objectives in the
homeland security strategies. The ODP preparedness officer is to prepare a
monitoring report for each on-site visit.

ODP officials told us that formal on-site monitoring visits were
temporarily discontinued after September 11, 2001, because of a high
volume of work. For fiscal years 2002 and 2003, ODP did not set formal
monitoring goals, such as a specific number of on-site visits to be made
in a given year. ODP officials said they continued to maintain active,
almost daily contact with the states by telephone, e-mail, and regular
correspondence and through informal visits to monitor programmatic and
financial aspects of the grants; however, no memorandums or formal
site-visit reports were filed during that period. In fiscal year 2004, ODP
updated its grant-monitoring guidance and established new monitoring
goals. According to the guidance, at least one office file review and one
on-site visit-resulting in a monitoring visit report-should be completed
for each state (inclusive of urban area grantees) each fiscal year. As of
September 30, 2004, ODP had completed 44 office file reviews and 44
on-site visits for the 56 states and territories. According to ODP, of the
remaining 12 reviews and visits for the fiscal year 2004 monitoring cycle,
8 have been conducted as of December 2004. ODP officials said that these
reviews and visits were delayed, in part, because of turnover in
preparedness officer positions and scheduling problems. These on-site
monitoring visits are a principal tool for, among other things,
ascertaining a grantee's progress on its strategy implementation, and
noting problems with implementing the grant program and the steps the
grantee and ODP will take to resolve them. These on-site visits are needed
to track whether and how grantees are managing their program funds.

Page 21 GAO-05-121 Homeland Security

    ODP and Some State and Local Jurisdictions Cite Staffing Challenges

ODP cited staffing challenges that have affected its grant management in
general. ODP has made progress in filling authorized staff positions, but
vacancies remain. ODP had 146 full-time equivalent positions authorized
for fiscal years 2003 and 2004, 30 of which were preparedness officers. As
of September 2004, ODP had filled 138 of these positions compared with 63
filled positions at the end of fiscal year 2003. Of the eight vacancies
remaining, five were preparedness officer positions. In addition to
performing office-based and scheduled on-site monitoring, these officers
serve as day-to-day liaisons to designated states. According to ODP, the
ODP preparedness officers currently have responsibility for one to five
states each, depending on the state's population.

ODP officials told us that, in hiring staff, they face challenges shared
by other agencies. ODP has acknowledged that it experienced significant
staffing shortages in fiscal years 2002 and 2003 because of a hiring
freeze. In addition, officials cited other factors, including staff
turnover, the lack of recruitment and relocation bonuses, the high cost of
living in the Washington metropolitan area, and competition with other DHS
entities and contracting firms for high-quality candidates. These
officials also said that the lengthy federal hiring process is further
extended by the need to conduct security clearances for job candidates. To
deal with some staff shortages, ODP has relied on outside contractors and
temporary employees, but they are not working directly with states and
local jurisdictions on grants, and none are ODP preparedness officers. 33

State and local officials in two of the five states visited also cited a
lack of sufficient state and local personnel to administer and manage
their grant programs. While the fiscal years 2002 and 2003 grants provided
funding that states and local jurisdictions could use to administer the
grants, 34 these officials said that the 3 percent limit on grant
management and administrative costs imposed by ODP in the fiscal year 2003
SHSGP II was not sufficient to cover the grant administrative costs needed
to administer and manage the grants. This allowance can be used at the
state and/or local levels, but the combined allowance cannot exceed 3
percent of the

33

As of the end of fiscal year 2003, ODP had 72 contract employees and as of
July 2004, 147.

34

The fiscal year 2002 SDPP included up to $150,000 or up to 2.5 percent of
each state's total award (whichever was greater) for administrative costs
associated with implementing the state strategies. For the fiscal year
2003 SHSGP I, the amount of grant funds that each state could use for
planning and administrative costs was specified in the program guidelines.
The amount ranged from $104,000 to about $3.2 million.

Page 22 GAO-05-121 Homeland Security

total first responder preparedness grant funds for each state. 35 For
SHSGP II first responder preparedness grant funds, the allowable
administrative costs ranged among all states from a low of about $102,000
to a high of about $3.1 million per state. Some officials said they have
not been able to hire the personnel necessary to administer and manage the
grant programs, in part, because of the limit on funds used for
administrative costs. DHS's IG and Homeland Security Advisory Council Task
Force 36 also cited similar reports from state and local officials they
spoke with. In responding to DHS's IG report, ODP said that the homeland
security grant programs allow for the hiring of both full- and part-time
personnel and contractors to implement the program and that this option
could be more widely used by states to address the issue of inadequate
staffing. ODP officials recently told us that the fiscal year 2005 grant
guidelines allow states to retain 3 percent of the total grant award and
local jurisdictions to use 2.5 percent of their grant allocation for
management and administrative purposes. According to these officials, this
change should alleviate some of the staffing issues.

35

For the fiscal year 2003 SHSGP II, states received separate funding for
both first responder preparedness and the cost incurred for protecting
critical infrastructure.

36

U.S. Department of Homeland Security, The Homeland Security Advisory
Council, A Report from the Task Force on State and Local Homeland Security
Funding (June 2004).

Page 23 GAO-05-121 Homeland Security

  Congress, ODP, States, and Localities Have Acted to Expedite Grant Awards, but
  Challenges Remain

Statutory Deadlines Were Congress, the Conference of Mayors, 37 some state
and local officials, and Imposed to Expedite the others expressed concerns
about the time ODP was taking to award grant Grant Award and funds to
states and for states to transfer grant funds to local jurisdictions.
Distribution Process For SDPP and SHSGP I grants, ODP was not required to
award grant funds to states within a specific time frame. During fiscal
year 2002, ODP took 123 days to make the SDPP grant application available
to states and, on average, about 21 days to approve states' applications
after receipt. For SHSGP II, however, the appropriations statute required
that ODP make the grant application available to states within 15 days of
enactment of the appropriation and approve or disapprove states'
applications within 15 days of receipt. According to ODP data for SHSGP
II, ODP made the grant application available to states within the required
deadline and awarded over 90 percent of the grants within 14 days of
receiving the applications. For SHSGP II, the appropriations statute also
mandated that states submit grant applications within 30 days of the grant
announcement. 38 According to ODP data, all states met the statutory
30-day mandate. For SHSGP II, the average number of days from grant
announcement to application submission declined from about 81 days in
fiscal year 2002 to about 23 days.

To expedite the transfer of grant funds from the states to local
jurisdictions, ODP program guidelines and subsequent appropriations acts
imposed additional deadlines on states. For SDPP, there were no

37

The United States Conference of Mayors Homeland Security Monitoring
Center, First Mayors' Report to the Nation: Tracking Federal Homeland
Security Funds Sent to the 50 State Governments (Washington, D.C.:
September 2003).

38

In fiscal year 2002, ODP required that states submit their grant
application by July 31, 2002 (79 days after the grant application was made
available to the states). For the fiscal year 2003 SHSGP I, ODP required
that the application be submitted in 45 days from the release of the grant
application.

mandatory deadlines or dates by which states should transfer grant funds
to localities. One of the states we visited, for example, took 91 days to
transfer the SDPP grant funds to a local jurisdiction while another state
we visited took 305 days. In addition, a DHS IG report found that for
SDPP, two of the states it visited took 73 and 186 days, respectively, to
transfer funds to local jurisdictions. Beginning with SHSGP I, ODP
required in its program guidelines that states transfer grant funds to
local jurisdictions within 45 days of the grant award date. Congress
subsequently included this requirement in the appropriations statute for
SHSGP II grant funds. To ensure compliance, ODP required states to submit
a certification form indicating that all awarded grant funds had been
transferred within the required 45-day period. 39 States that were unable
to meet the 45-day period had to explain the reasons for not transferring
the funds and indicate when the funds would be transferred. According to
ODP, for SHSGP I and II, respectively, 33 and 31 states certified that the
required 45-day period had been met. 40

To further assist states in expediting the transfer of grant funds to
local jurisdictions, ODP also modified its requirements for documentation
to be submitted as part of the grant application process for fiscal years
2002 and 2003. In fiscal year 2002, ODP required states to submit budget
detail worksheets and program narratives indicating how the grant funds
would be used for equipment, exercises, and administration-and have them
approved. If a state failed to submit the required documentation, ODP
would award the grant funds, with the special condition that the state
could not transfer, expend, or draw down any grant funds until the
required documentation was submitted and approved. In fiscal year 2002,
ODP imposed special conditions on 37 states for failure to submit the
required documentation and removed the condition only after the states
submitted the documentation. The time required to remove the special
conditions ranged from about 1 month to 21 months. For example, in one
state we reviewed, ODP awarded SDPP grant funds and notified the state of
the special conditions on September 13, 2002; the special conditions

39

For the fiscal year 2003 SHSGP II, states had to certify that they had met
the statutory requirement to transfer 80 percent of the awarded funds for
first responder preparedness and 50 percent of the awarded funds for
critical infrastructure protection to local jurisdictions within the
required 45-day period.

40

According to ODP, follow-up letters were distributed to states that had
not submitted the certification form or were not certified, followed by a
series of phone calls to collect the pertinent information.

were removed about 6 months later on March 18, 2003, after the state had
met those conditions.

However, in fiscal year 2003, ODP allowed states to move forward more
quickly, by permitting them to transfer grant funds to local jurisdictions
before all required grant documents had been submitted. If a state failed
to submit the required documentation for SHSGP I, ODP awarded the grant
funds and allowed the state to transfer the funds to local jurisdictions.
While the state and local jurisdictions could not expend-and the state
could not draw down-the grant funds until the required documentation was
submitted and approved, they could plan their expenditures and begin state
and locally required procedures such as obtaining approval of the state
legislature or city council to use the funds. For SHSGP I, ODP imposed
special conditions on 47 states for failure to submit the required
documentation and removed the condition only after the states submitted
the documentation. The special conditions were removed approximately 1
month to 15 months after the grant funds were awarded to the states. For
the SHSGP II grant cycle, in order to further expedite the award process
and availability of fiscal year 2003 funds for expenditure, ODP no longer
required states to submit the budget detail worksheets and certain other
documents as part of the grant application process. 41 Rather, these
documents could be submitted later with the state's biannual progress
report. 42 Thus, states were able to transfer, expend, and draw down grant
funds immediately after ODP awarded the grant funds. (See appendix III for
grant award and distribution timelines for selected state and local
grantees.)

41

For the fiscal year 2004 Homeland Security Grant Program, Congress
required states to obligate grant funds to localities within 60 days of
the grant award date. States did not have to submit budget detail
worksheets and program narratives as part of the grant application
process. However, states were expected to maintain complete and accurate
accounting records and make those records available to DHS upon request.
In addition, states were to provide information on how the expenditure of
grant funds will support the goals and objectives included in the state
homeland security strategy in the Initial Strategy Implementation Plan
report due no later than 60 days after the grant award date.

42

The Categorical Assistance Progress Report for the period ending June 30,
2003, was due July 30, 2003. This report describes, among other things,
the total amount of funds expended and the progress made to date in
achieving the state's overall goals and objectives identified in the state
homeland security strategy.

    Some States Have Revised Procurement Requirements Affecting Grant Time
    Lines, and ODP Is Developing Related Best Practices

Despite congressional and ODP efforts to expedite the award of grant funds
to states and the transfer of those funds to localities, some states and
local jurisdictions could not expend the grant funds to purchase equipment
or services until other, nonfederal requirements were met. Some state and
local officials' ability to spend grant funds was complicated by the need
to meet various state and local legal and procurement requirements and
approval processes, which could add months to the process of purchasing
equipment after grant funds had been awarded. For example, in one state we
visited, the state legislature must approve how the grant funds will be
expended. If the state legislature is not in session when the grant funds
are awarded, it could take at least 4 months to obtain state approval to
spend the funds. 43 In another state we visited, a city was notified on
July 17, 2003, that SHSGP I grant funds were available for use, but the
city council did not vote to accept the funds until almost 4 months later.
A 2004 report by the House Select Committee on Homeland Security also
cited instances of slowness at the state and local government levels in
approving the acceptance and expenditure of grant funds. For example,
according to the committee report, one county took about 7 months after
receiving its SHSGP I grant award to get authorization to spend the grant
funds. Some state and local officials we talked with said that complying
with their normal procurement regulations could also take months. They
said that these regulations require, among other things, competitive
bidding for certain purchases-a frequently lengthy process in their view.

Some states, in conjunction with DHS, have modified their procurement
practices to expedite the procurement of equipment and services. Officials
in two of the five states we visited told us they established centralized
purchasing systems that allow equipment and services to be purchased by
the state on behalf of local jurisdictions, freeing them from some local
legal and procurement requirements. As reported by the House Select
Committee on Homeland Security in April 2004, many states were looking to
move to a centralized purchasing system for the same reason. In addition,
the DHS's Homeland Security Advisory Council Task Force reported that
several states developed statewide procurement contracts that allow local
jurisdictions to buy equipment and services using a prenegotiated state
contract. According to DHS, it has offered options for

43

When the state legislature is not in session, changes of over $1 million
in the budget must be reviewed and approved by the Legislative Budget
Commission, which generally meets quarterly.

Page 27 GAO-05-121 Homeland Security

equipment procurement, through agreements with the U.S. Department of
Defense's Defense Logistics Agency and the Marine Corps Systems Command,
to allow state and local jurisdictions to purchase equipment directly from
their prime vendors. DHS said that these agreements provide an alternative
to state and local procurement processes and often result in a more rapid
product delivery at a lower cost. For example, one state we visited is
using a Defense Logistics Agency prime vendor to make equipment purchases.
Local jurisdictions can order the equipment without having to go through
their own locally based competitive bidding process.

Congress has also taken steps to address a problem that some states and
localities cited concerning a federal policy that provides reimbursement
to states and localities only after they have incurred an obligation, such
as a purchase order, to pay for goods and services. Until fiscal year
2005, after submitting the appropriate documentation, states and
localities could receive federal funds to pay for these goods and services
several days before the payment was due so that they did not have to use
their own funds for payment. However, according to DHS's Homeland Security
Advisory Council Task Force, many municipalities and counties had
difficulty participating in this process either because they did not
receive their federal funds before payment had to be made or their local
governments required funds to be on hand before commencing the procurement
process. Officials in one city we visited said that, to solve the latter
problem, the city had to set up a new emergency operations account with
its own funds. The task force recommended that for fiscal year 2005, ODP
homeland security grants be exempt from the Cash Management Improvement
Act 44 to allow funds to be provided to states and municipalities up to
120 days in advance of expenditures. The fiscal year 2005 DHS
appropriations legislation includes a provision that exempts formula-based
grants (SHSGP) and discretionary grants, including UASI and other ODP
grants, from the act's requirement that an agency schedule the transfer of
funds to a state so as to minimize the time elapsing between

Pub. L. No. 101-453, 104 Stat. 1058 (1990). The purpose of the law is to
ensure efficiency, effectiveness, and equity in the exchange of funds
between the federal government and the states. The Cash Management
Improvement Act responded to previously alleged instances in which either
the states drew cash advances well before federal funds were needed to
make payment or states used their own funds to satisfy federal program
needs and were not reimbursed in a timely manner by the federal agencies.
The act provided that states would pay interest to the federal government
if they draw funds in advance of need and that the federal government
would pay interest to states if the federal program agency does not
reimburse the states in a timely manner when states use their own funds.

the transfer of funds from the U.S. Treasury and the state's disbursement
of the funds for program purposes.

In addition, DHS efforts are under way to identify and disseminate best
practices, including how states and localities manage legal and
procurement issues that affect grant distribution. DHS's Homeland Security
Advisory Council Task Force stated in a June 2004 report that some
jurisdictions have been "very innovative" in developing mechanisms to
support the procurement and delivery of emergency-response-related
equipment. For example, one state cited in the report was in the process
of forming a procurement working group to address issues as they arise.
The report also cited that several states have developed statewide
procurement contracts that allow municipal government units to buy first
responder equipment and services. One state created a passwordprotected
Web site that allowed local jurisdictions to view their allocation balance
and place orders for equipment up to their funding allocation limit.
According to the task force, these efforts substantially reduced the time
it takes for localities to purchase and receive their equipment. The task
force recommended that, among other things, DHS should, in coordination
with state, county, and other governments, identify, compile, and
disseminate best practices to help states address grant management issues.
According to ODP, in an effort to complement and reinforce the task
force's recommendations, in partnership with the National Criminal Justice
Association, 45 it established a new Homeland Security Preparedness
Technical Assistance Program service to enhance the grant management
capabilities of state administrative agencies. In an August 30, 2004,
Information Bulletin, ODP requested that state administrative agencies
complete a survey designed to gather information on their grant management
technical needs and best practices related to managing and accounting for
ODP grants, including the procurement of equipment and services at the
state and local levels. The information that ODP is gathering is to serve
as a foundation for the development of a tailored, onsite assistance
program for states to ensure that identified best practices are
implemented and critical grant management needs and problems are
addressed. According to ODP, this program will be operational in December
2004.

The National Criminal Justice Association represents state, tribal, and
local criminal and juvenile justice system concerns to the federal
government. Among other things, it promotes the development of justice
systems in states, tribal nations, and units of local government that
enhance public safety.

Page 29 GAO-05-121 Homeland Security

Despite efforts to streamline local procurement practices, some challenges
remain at the state and local levels. An ODP requirement that is based on
language in the appropriations statute could delay procurements,
particularly in states that have a centralized purchasing system.
Specifically, for the fiscal 2004 grant cycle, states are required by
statute to pass through no less than 80 percent of total grant funding to
local jurisdictions within 60 days of the award. In order for states to
retain grant funds beyond the 60-day limit, ODP requires states and local
jurisdictions to sign a memorandum of understanding (MOU) indicating that
states may retain-at the local jurisdiction's request-some or all funds in
order to make purchases on a local jurisdiction's behalf. The MOU must
specify the amount of funds to be retained by the state. A state official
in one state we visited said that, while the state's centralized
purchasing system had worked well in prior years, the state has
discontinued using it because of the MOU requirement, since establishing
MOUs with every locality might take years. The state transferred the
fiscal year 2004 grant funds to local jurisdictions so they can make their
own purchases. In another state, officials expressed concern that this
requirement would negatively affect their ability to maintain homeland
security training provided to local jurisdictions at state colleges that
had been previously funded from local jurisdictions' grant funds. In a
June 23, 2004, ODP Information Bulletin, ODP strongly recommended that
states retaining funds at the state level on behalf of local jurisdictions
have the MOUs reviewed by DHS's Office of General Counsel to ensure that
the MOUs meet the requirements of the appropriation language and ODP
program guidelines. ODP officials told us that they were assisting states
to adapt to the new requirement.

The terrorist attacks of September 11, 2001, forced the nation to
reexamine its requirements for domestic safety, including the capacity and
Observations  resources that would be needed at the state and local levels
to prevent,

prepare for, respond to, or recover from potential future threats from

terrorists and minimize their impact. Congress addressed this concern in

the months after the attacks, in part by increasing the grant funds that

states would receive to enhance their emergency first responder and

public health and safety capabilities to deal with terrorist attacks
involving

CBRNE weapons. Not surprisingly, the enormous effort required to bolster

first responder capacity nationwide posed challenges for government

administrators at the federal, state, and local levels. A major challenge
in

administering first responder grants is balancing two goals: minimizing
the

time it takes to distribute grant funds to state and local first
responders,

and ensuring appropriate planning and accountability for the effective use

of grant funds. ODP's approach to striking this balance has been evolving

Page 30 GAO-05-121 Homeland Security

                       Agency Comments and Our Evaluation

from experience, congressional action, and feedback from states and local
jurisdictions.

Over the last 2 years, working in concert with state governments and
others, DHS has made progress, through ODP, in managing its state homeland
security grant programs. ODP has addressed management problems regarding
how grants were awarded and funds distributed, which arose following the
dramatic increase in federal funding for first responders after September
11. While some localities continue to face legal and procurement
challenges that can tie up access to grant funds, ODP is taking steps to
provide technical assistance that will, among other things, give state and
local officials access to best-practice information on how other
jurisdictions have successfully addressed procurement challenges.

As ODP continues to administer its state and urban first responder grant
programs, it will likely face new challenges. In particular, as DHS and
ODP work to develop national preparedness standards, it will be important
to listen and respond fully to the concerns of states, local
jurisdictions, and other interested parties about, among other things, the
planned time frames for implementing the new standards. It will also be
important to ensure that there is adequate collaboration and guidance for
moving forward. Effective collaboration among ODP, states, and others in
developing appropriate preparedness performance goals and measures will be
essential to ensuring that the nation's emergency response capabilities
are appropriately identified, assessed, and strengthened.

DHS generally agreed with the report's findings. In particular, the agency
concurred that it faced a number of challenges related to effectively
managing first responder grants and highlighted the progress it has made
in addressing them. The agency expressed the view, however, that the
progress already achieved in meeting these challenges was not
appropriately reflected in the title of the report. We disagree. As DHS
notes, our report acknowledges the efforts the agency has made in revising
grant procedures to expedite awards while maintaining accountability.
Nevertheless, not all of the agency's efforts have gone smoothly, as
attested, for example, by the problems that DHS and the states experienced
in realistically defining first responder equipment needs in 2003. In view
of the concerns recently expressed by state and other officials, DHS may,
in our view, continue to face significant challenges in meeting its time
tables to develop realistic capability requirements and performance
measures for first responders. DHS also provided further details on some
grant management issues we raised in the report. We have revised the
report as appropriate to include these and other technical comments
provided.

As agreed with your office, unless you publicly announce its contents
earlier, we plan no further distribution of this report until 30 days from
its issue date. At that time, we will send copies of this report to
relevant congressional committees and subcommittees, the Secretary of
Homeland Security, and to other interested parties. We will also make
copies available to others upon request. In addition, the report will be
available at no charge on GAO's Web site at http://www.gao.gov.

If you have any questions about this report or wish to discuss it further,
please contact me at (202) 512-8777 or [email protected]. Key contributors
to this report are listed in appendix VI.

Sincerely yours,

William O. Jenkins, Jr. Director, Homeland Security and Justice Issues

                       Appendix I: Scope and Methodology

We initially addressed our researchable questions regarding the Office for
Domestic Preparedness's (ODP) structure and processes for program and
financial management of its grants and its monitoring policies and
processes in a briefing to the Subcommittee on Homeland Security of the
House Committee on Appropriations. In addressing those questions, we
identified 25 domestic preparedness programs managed by ODP in fiscal
years 2002 and 2003. 1 For this report, we selected the five largest
programs in terms of federal funding provided to state and local
jurisdictions for our detailed review. Three of the five programs that
addressed state and local preparedness issues were basically for the same
purposes but received funding from separate appropriations. These were the
fiscal year 2002 State Domestic Preparedness Program (SDPP) and the fiscal
year 2003 State Homeland Security Grant Programs (SHSGP) I and II. The
other two programs were awarded to selected urban areas. These were the
fiscal year 2003 Urban Areas Security Initiatives (UASI) I and II grant
programs.

We also selected Arizona, California, Florida, Missouri, and Pennsylvania
and 19 local jurisdictions within those states:

     o The cities of Phoenix and Pima and Maricopa and Coconino Counties in
       Arizona.
     o The cities of Los Angeles and Sacramento and the County of Los Angeles
       in California.
     o The city of Miami, Miami-Dade County, and the Miami and Tallahassee
       Regional Domestic Security Task Forces in Florida.
     o The city of St. Louis, St. Louis and Franklin Counties, and the rural
       cities of Jackson and Sikeston in Missouri.
     o The city of Philadelphia and the Southeastern and South Central
       Regional Terrorism Task Forces in Pennsylvania.

The five states were selected on the basis of the amount of ODP grant
funding received, population size, and other factors. The local
jurisdictions

1

Even though some of the grant programs were basically for the same or
similar purposes, they are counted as separate grants in part because of
separate appropriations in the same and different years and name changes.

Page 33 GAO-05-121 Homeland Security Appendix I: Scope and Methodology

were selected on the basis of a mix of urban and rural locations to
include cities and counties that received UASI funding.

To determine how SHSGP and UASI were administered in fiscal years 2002 and
2003 so that ODP could ensure that grant funds were spent in accordance
with grant guidance and state preparedness planning, we interviewed ODP
officials and homeland security and grant management officials and first
responders in the five selected states and from selected local
jurisdictions within those states. We also obtained and reviewed related
ODP policy guidance and program guidelines for the SDPP/SHSGP and UASI
grant programs. We also obtained and reviewed documentation on grant
awards to state and local jurisdictions. We spoke with ODP officials about
their grant monitoring and reporting processes and obtained and reviewed
related ODP grant-monitoring guidance and monitoring reports for fiscal
year 2004. We also obtained and analyzed data on the number of
office-based and on-site-monitoring reviews conducted in fiscal year 2004.
We reviewed these data for obvious inconsistency errors and completeness
and compared these data with onsite-monitoring reports prepared by ODP. On
the basis of these efforts, we determined that the monitoring review data
were sufficiently reliable for the purpose of this report. In addition, we
spoke with ODP and state and local officials about staffing issues that
affect grant management. We also interviewed ODP and state and local
officials and reviewed documentation about ODP's state homeland security
needs assessment and strategy development process and the similar needs
assessment and strategy development process for selected urban areas. In
addition, we obtained and reviewed the state domestic preparedness
strategies for the selected five states. In conjunction with this effort,
we also obtained information about the steps that ODP is taking to
implement Homeland Security Presidential Directive-8 regarding national
preparedness goals and performance standards. We also reviewed relevant
reports on homeland security and domestic preparedness that discuss the
development of national performance standards.

To determine the time frames for awarding and distributing SHSGP and UASI
grants established by ODP grant guidance or by law, and how these time
frames affected the grant cycle, we obtained and analyzed appropriations
acts and program guidelines for the grant programs. We also met with ODP
officials and state homeland security and grant management officials, and
local grant managers and first responders in the selected states and local
jurisdictions to discuss how the time lines affected the grant cycle. We
obtained and analyzed data on the time frames associated with the grant
award and distribution processes. We

Page 34 GAO-05-121 Homeland Security Appendix I: Scope and Methodology

reviewed these data for obvious inconsistency errors and completeness and
compared these data with hard-copy documents we obtained for these states.
When we found discrepancies, we brought them to the attention of ODP and
state and local officials and worked with them to correct the
discrepancies before conducting our analyses. On the basis of these
efforts, we determined that the time-frame data were sufficiently reliable
for the purpose of this report. We also obtained information about local
procurement policies and practices. In addition, we reviewed recent
reports and studies on issues related to federal funding and oversight of
grants for first responders. We also obtained grant funding and
expenditures as of July 31, 2004, for the 56 states and territories and
the urban areas. Given that the grant funding and expenditure data are
used for background purposes only, we did not assess the reliability of
these data. We also obtained and analyzed key dates associated with the
grant award, distribution, and reimbursement processes for selected states
and local jurisdictions. We conducted this work from November 2003 through
November 2004 in accordance with generally accepted government auditing
standards.

Appendix II: Fiscal Years 2002 and 2003 SDPP/SHSGP and UASI Funding and Draw
Downs by State

Given that these grant-funding and drawn-down amounts are used for
background purposes only, we did not assess the reliability of these data.

Table 3: Fiscal Year 2002 State Domestic Preparedness Program (SDPP) and
Fiscal Year 2003 State Homeland Security Grant Programs (SHSGP) Funding
and Draw Downs as of July 31, 2004

                              Dollars in thousands

                        FY 2002 SDPP FY 2003 SHSGP Total

Drawn SHSGP I Drawn SHSGP II Drawn Drawn States and territories Funding
down funding down funding down Funding down

        Alabama $5,317 $3,259 $9,457 $360 $25,049 $2,514 $39,823 $6,133

               Alaska 2,783 203 4,995 485 13,230 855 21,008 1,543

              American Samoa 828 714 1,482 0 3,926 874 6,236 1,588

          Arizona 5,770 3,929 10,584 3,069 28,033 6,463 44,387 13,461

          Arkansas 4,141 2,169 7,394 4,234 19,585 7,964 31,120 14,367

      California 24,831 12,403 45,023 11,903 119,256 33,262 189,110 57,568

          Colorado 5,220 3,776 9,480 4,068 25,111 5,249 39,811 13,093

         Connecticut 4,626 3,133 8,265 2,281 21,893 1,515 34,784 6,928

            Delaware 2,887 2,643 5,185 515 13,733 2,698 21,805 5,856

       District of Columbia 2,747 2,559 4,910 0 13,006 1,967 20,663 4,526

         Florida 12,967 12,967 23,654 9,966 62,655 12,107 99,276 35,041

          Georgia 7,797 1,628 14,188 5,319 37,579 9,253 59,564 16,200

                  Guam 892 783 1,596 209 4,226 227 6,714 1,219

              Hawaii 3,172 737 5,693 484 15,079 2,066 23,944 3,286

             Idaho 3,226 963 5,803 2,306 15,375 4,412 24,404 7,680

         Illinois 10,604 7,559 18,879 10,399 50,005 1,478 79,488 19,435

          Indiana 6,400 4,834 11,399 6,844 30,194 23,327 47,993 35,005

              Iowa 4,308 4,307 7,657 725 20,282 1,747 32,247 6,779

            Kansas 4,151 4,064 7,401 1,303 19,603 1,401 31,155 6,767

          Kentucky 5,048 2,857 9,001 4,369 23,838 5,444 37,887 12,670

          Louisiana 5,331 4,976 9,451 1,028 25,037 4,367 39,819 10,371

            Maine 3,213 2,771 5,751 1,769 15,232 3,378 24,196 7,919

          Maryland 5,881 5,850 10,585 3,550 28,037 3,437 44,503 12,836

        Massachusetts 6,579 6,437 11,711 815 31,020 12,598 49,310 19,850

          Michigan 8,958 8,124 15,918 5,099 42,162 2,414 67,038 15,638

          Minnesota 5,631 5,207 10,076 1,965 26,690 2,374 42,397 9,546

          Mississippi 4,255 599 7,582 1,933 20,083 2,955 31,920 5,487

          Missouri 6,079 5,042 10,834 3,872 28,697 7,285 45,610 16,199

Appendix II: Fiscal Years 2002 and 2003 SDPP/SHSGP and UASI Funding and
Draw Downs by State

Dollars in thousands
                  FY 2002 SDPP             FY 2003 SHSGP                    Total
                       Drawn    SHSGP I  Drawn    SHSGP II   Drawn                 Drawn 
States and   Funding    down    funding     down    funding     down    Funding     down 
territories                                                                     
Montana         2,967  2,589      5,303    1,272     14,047      730     22,317    4,591 
Nebraska        3,502  2,560      6,255    2,877     16,568    6,310     26,325   11,747 
Nevada          3,693  3,000      6,771    2,491     17,935    3,442     28,399    8,933 
New             3,187      687    5,727    1,113     15,172    6,887     24,086    8,687 
Hampshire                                                                       
New Jersey      7,948  2,839     14,222    1,470     37,671    6,765     59,841   11,074 
New Mexico      3,574  1,947      6,401    1,286     16,956    1,302     26,931    4,535 
New York       14,953  12,000    26,492  23,400      70,172  63,000     111,617   98,400 
North           7,706  6,322     13,908    3,995     36,840    4,337     58,454   14,654 
Carolina                                                                        
North Dakota    2,794  2,670      4,983    2,026     13,200    1,500     20,977    6,196 
Northern                                                                                 
Mariana           835      632    1,496      892      3,963      815      6,294    2,338
Islands                                                                         
Ohio            9,897  8,350     17,510    6,757     46,378    8,403     73,785   23,511 
Oklahoma        4,656      524    8,304      978     21,996      222     34,956    1,724 
Oregon          4,637  1,857      8,336    1,884     22,081    4,760     35,054    8,501 
Pennsylvania   10,512  6,168     18,570    6,906     49,189    4,249     78,271   17,323 
Puerto Rico     4,894      490    8,727        0     23,118        0     36,739      490 
Rhode Island    3,063  1,171      5,489    1,899     14,540    9,286     23,092   12,356 
South           5,028  4,552      9,017    2,032     23,882    6,626     37,927   13,210 
Carolina                                                                        
South Dakota    2,868  2,745      5,131    1,265     13,591    6,027     21,590   10,036 
Tennessee       6,140  4,089     10,978    1,961     29,080      374     46,198    6,424 
Texas          16,196  8,878     29,538  10,324      78,238  14,078     123,972   33,280 
Utah            3,849  2,608      6,937    4,184     18,374    7,833     29,160   14,625 
Vermont         2,772  2,352      4,963    2,652     13,147    3,688     20,882    8,692 
Virgin            861      133    1,542    1,227      4,085    2,409      6,488    3,770 
Islands                                                                         
Virginia        7,062  6,226     12,716    7,846     33,683  22,956      53,461   37,028 
Washington      6,276  5,368     11,294    6,877     29,917    3,655     47,487   15,899 
West            3,567  3,567      6,340    5,758     16,792    8,856     26,699   18,181 
Virginia                                                                        
Wisconsin       5,925  5,238     10,565    7,545     27,985  20,800      44,475   33,584 
Wyoming         2,696  2,285      4,827    1,410     12,784    2,205     20,307    5,899 
Total        $315,700 $216,339 $566,295 $201,197 $1,500,000 $385,146 $2,381,995 $802,682 

Source: Office for Domestic Preparedness (ODP) grant guidance and Office
of Justice Programs/Office of the Comptroller (OJP/OC) financial
management data.

  Appendix II: Fiscal Years 2002 and 2003 SDPP/SHSGP and UASI Funding and Draw
                                 Downs by State

Table 4: Fiscal Year 2003 Urban Areas Security Initiative (UASI) I and II Grant
                   Funding and Draw Downs as of July 31, 2004

                              Dollars in thousands

  UASI I

Drawn State, city, county Funding down UASI II Total

Drawn Drawn Funding down Funding down

                                      a a

Arizona $11,033 $471 $11,033 $471 Phoenix and Maricopa County

California $22,771 $560 62,202 6,014 84,973 6,574

Los Angelesb and Los Angeles

County; San Franciscob and San

Francisco County; San Diego City and

San Diego County; Sacramento and

Sacramento County; and Long Beach

and Los Angeles County

                                       aa

Colorado 15,568 93 15,568 Denver and Denver County

                                       aa

Florida 18,960 3,296 18,960 3,296

Miami and Miami-Dade County;

Tampa and Hillsborough County

                                      a a

Hawaii 6,871 1,718 6,871 1,718 Honolulu and Honolulu County

Illinois 10,896 0 29,976 0 40,872 0 Chicago b and Cook County

                                      a a

Louisiana 6,283 350 6,283 350 New Orleans and Orleans Parish

                                       aa

Maryland 10,901 1,468 10,901 1,468

Baltimore and Anne Arundel and

Baltimore Counties

                                       aa

Michigan 12,273 0 12,273 Detroit and Wayne County

                                       aa

Missouri 19,549 1,605 19,549 1,605

St. Louis and St. Louis County;

Kansas City and Clay, Jackson,

Platte, and Cass Counties

                                      a a

Massachusetts 16,727 0 16,727 Boston and Suffolk County

National Capital Region b 18,081 459 42,410 186 60,491

                                      a a

New Jersey 11,893 0 11,893 Newark and Essex County

Appendix II: Fiscal Years 2002 and 2003 SDPP/SHSGP and UASI Funding and
Draw Downs by State

Dollars in thousands    
                            UASI I             UASI II            Total
                                   Drawn              Drawn             Drawn 
State, city, county     Funding  down   Funding   down   Funding      down 
New York                24,768  2,706   135,267  103,103 160,035   105,809 
New York Cityb; Buffalo                                           
and Erie                                                          
County                                                            
Ohio                       a         a    13,859     16   13,859        16 
Cincinnati and Hamilton                                           
County;                                                           
Cleveland and Cuyahoga                                            
County                                                            
Oregon                     a         a     6,766      1   6,766          1 
Portland and                                                      
Washington, Multnomah,                                            
and Clackamas Counties                                            
Pennsylvania               a         a     21,039     0   21,039         0 
Philadelphia and                                                  
Philadelphia County;                                              
Pittsburgh and                                                    
Allegheny County                                                  
Tennessee                  a         a     6,072      0   6,072          0 
Memphis and Shelby                                                
County                                                            
Texas                    8,634    0        34,165     8   42,799         8 
Houston b and Harris,                                             
Fort Bend, and                                                    
Montgomery Counties;                                              
Dallas and                                                        
Denton, Rockwell,                                                 
Kaufman                                                           
Collin, and Dallas                                                
Counties                                                          
Washington              11,201   335      18,187     24   29,388       359 
Seattleb and King                                                 
County                                                            
Total                   $96,351 $4,060 $500,000 $118,354 $596,351 $122,414 

Source: ODP grant guidance and ODP and OJP/OC financial status
information.

a

Data not applicable.  

b

Six cities and the National Capital Region also received UASI I grant
funding.  

Appendix III: Grant Award, Distribution, and Reimbursement Process for Selected
States and Local Jurisdictions

Figure 4: Key Dates Associated with FY 2002 State Domestic Preparedness Program
                         Grant Distribution for State A

Source: GAO based on ODP, state, and local jurisdiction data.

Notes: ODP = Office for Domestic Preparedness SAA = state administrative
agency SDPP = State Domestic Preparedness Program

Appendix III: Grant Award, Distribution, and Reimbursement Process for
Selected States and Local Jurisdictions

Figure 5: Key Dates Associated with FY 2002 State Domestic Preparedness Program
                         Grant Distribution for State B

Source: GAO based on ODP, state, and local jurisdiction data.

Notes: ODP = Office for Domestic Preparedness SAA = state administrative
agency SDPP = State Domestic Preparedness Program

Appendix III: Grant Award, Distribution, and Reimbursement Process for
Selected States and Local Jurisdictions

Figure 6: Key Dates Associated with FY 2003 State Homeland Security Grant
                    Program I Grant Distribution for State B

Source: GAO based on ODP, state, and local jurisdiction data.

Notes: ESO = emergency services office ODP = Office for Domestic
Preparedness SAA = state administrative agency SHSGP = State Homeland
Security Grant Program

Appendix III: Grant Award, Distribution, and Reimbursement Process for
Selected States and Local Jurisdictions

Figure 7: Key Dates Associated with FY 2003 State Homeland Security Grant
                   Program II Grant Distribution for State B

Source: GAO based on ODP, state, and local jurisdiction data.

Notes: ESO = emergency services office ODP = Office for Domestic
Preparedness SAA = state administrative agency SHSGP = State Homeland
Security Grant Program

Appendix III: Grant Award, Distribution, and Reimbursement Process for
Selected States and Local Jurisdictions

Figure 8: Key Dates Associated with FY 2003 State Homeland Security Grant
                    Program I Grant Distribution for State C

Source: GAO based on ODP, state, and local jurisdiction data.

Notes: ODP = Office for Domestic Preparedness SAA = state administrative
agency SHSGP = State Homeland Security Grant Program

         Appendix IV: Comments from the Department of Homeland Security

                      Page 45 GAO-05-121 Homeland Security

Appendix IV: Comments from the Department of Homeland Security

                      Page 46 GAO-05-121 Homeland Security

Appendix IV: Comments from the Department of Homeland Security

                      Page 47 GAO-05-121 Homeland Security

                        Appendix V: Related GAO Products

Homeland Security: Effective Regional Coordination Can Enhance Emergency
Preparedness. GAO-04-1009. Washington, D.C.: September 15, 2004.

Homeland Security: Federal Leadership Needed to Facilitate Interoperable
Communications between First Responders. GAO-04- 1057T. Washington, D.C.:
September 8, 2004.

Homeland Security: Federal Leadership and Intergovernmental Cooperation
Required to Achieve First Responder Interoperable Communications.
GAO-04-740. Washington, D.C.: July 20, 2004.

Homeland Security: Federal Leadership and Intergovernmental Cooperation
Required to Achieve First Responder Interoperable Communications.
GAO-04-963T. Washington, D.C.: July 20, 2004.

Homeland Security: Coordinated Planning and Standards Needed to Better
Manage First Responder Grants in the National Capital Region. GAO-04-904T.
Washington, D.C.: June 24, 2004.

Homeland Security: Management of First Responder Grants in the National
Capital Region Reflects the Need for Coordinated Planning and Performance
Goals. GAO-04-433. Washington, D.C.: May 28, 2004.

Emergency Preparedness: Federal Funds for First Responders. GAO-04- 788T.
Washington, D.C.: May 13, 2004.

Homeland Security: Challenges in Achieving Interoperable Communications
for First Responders. GAO-04-231T. Washington, D.C.: November 6, 2003.

Homeland Security: Reforming Federal Grants to Better Meet Outstanding
Needs. GAO-03-1146T. Washington, D.C.: September 3, 2003.

Appendix VI: GAO Contacts and Staff Acknowledgments

William O. Jenkins, Jr., (202) 512-8757

  GAO Contacts

Robert White (202) 512-5463

In addition to those persons mentioned above, David Alexander,

  Staff

Leo Barbour, Amy Bernstein, Mona Nichols Blake, Laura Helm,
Acknowledgments Carlos Garcia, Jessica Kaczmarek, and Katrina Moss made
key contributions to this report.

(440244)

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