-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-645		

TITLE:     Foreign Assistance: USAID Completed Many Caribbean 
Disaster Recovery Activities, but Several Challenges Hampered Efforts

DATE:   05/26/2006 
				                                                                         
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GAO-06-645

     

     * Results in Brief
     * Background
          * U.S. Emergency Relief and Immediate Recovery Assistance
          * U.S. Recovery and Reconstruction Assistance
     * USAID Completed Numerous Recovery Efforts within 1 Year but
          * USAID Expended Majority of Recovery Funds within 1 Year
          * USAID Implemented Various Nonconstruction Recovery Activitie
          * USAID Began Many Construction-Related Projects but Did Not C
     * Various Factors Slowed USAID's Implementation and Completion
          * Severe Weather Delayed Program Activities in Jamaica and Hai
          * Coordination Challenges Hindered USAID's Implementation and
          * Construction-Related Challenges Led to Delays in Grenada, Ja
          * Security Problems Disrupted Program Activities in Haiti
     * Lack of Formal Program Guidance, Time Frame, and Staffing Is
          * Lack of Guidance That Includes Lessons Learned Contributed t
          * USAID Applied Some Lessons from Previous Disaster Programs b
               * USAID Applied Some Lessons Learned from Previous Programs
               * One-Year Time Frame May Have Limited Impact and Sustainabili
               * USAID Did Not Implement Some Prior Staffing Recommendations
          * USAID Staff and Contractors Are Recording Lessons Learned
     * Conclusions
     * Recommendations for Executive Action
     * Agency Comments and Our Evaluation
          * Lessons Learned for Program Planning and Implementation
          * Lessons Learned for Staffing
          * Lessons Learned for Recovery Activities
               * Disaster Preparedness and Mitigation
               * Construction
               * Nonconstruction
          * Lessons Learned for Ensuring Accountability
          * Lessons Learned for Monitoring and Evaluation
     * GAO Contact
     * Staff Acknowledgments
     * GAO's Mission
     * Obtaining Copies of GAO Reports and Testimony
          * Order by Mail or Phone
     * To Report Fraud, Waste, and Abuse in Federal Programs
     * Congressional Relations
     * Public Affairs

Report to the Chairman, Subcommittee on Foreign Operations, Export
Financing and Related Programs, Committee on Appropriations, House of
Representatives

United States Government Accountability Office

GAO

May 2006

FOREIGN ASSISTANCE

USAID Completed Many Caribbean Disaster Recovery Activities, but Several
Challenges Hampered Efforts

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GAO-06-645

Contents

Letter 1

Results in Brief 2
Background 5
USAID Completed Numerous Recovery Efforts within 1 Year but Granted
Extensions for Many Construction Projects 8
Various Factors Slowed USAID's Implementation and Completion of Program
Activities 16
Lack of Formal Program Guidance, Time Frame, and Staffing Issues
Contributed to Implementation Problems 19
Conclusions 27
Recommendations for Executive Action 27
Agency Comments and Our Evaluation 27
Appendix I Objectives, Scope, and Methodology 30
Appendix II Summary of Lessons Learned from USAID Disaster Recovery and
Reconstruction Efforts 34
Appendix III Comments from the U.S. Agency for International Development
42
Appendix IV GAO Contact and Staff Acknowledgments 45
Related GAO Products 46

Tables

Table 1: USAID Key Nonconstruction-Related Recovery Activities in Grenada,
Jamaica, and Haiti, as of December 31, 2005 10
Table 2: USAID Key Construction-Related Recovery Activities in Grenada,
Jamaica, and Haiti, as of December 31, 2005 13
Table 3: Number and Types of Activities at Project Sites GAO Visited in
Grenada, Jamaica, and Haiti 31

Figures

Figure 1: Areas and Extent of Hurricane Damage in Grenada, Jamaica, and
Haiti 6
Figure 2: Recovery and Reconstruction Allocations by Country 7
Figure 3: USAID Allocation and Expenditure for Disaster Recovery
Assistance for Grenada, Jamaica, and Haiti, as of December 31, 2005 9
Figure 4: USAID-Supported Drainage Canal Cleanup in Haiti 12
Figure 5: USAID-Funded School Repair in Grenada 15

Abbreviations

Hurricane Ivan Program Hurricane Ivan Recovery and Rehabilitation Program
NGO nongovernmental organization OFDA Office of Foreign Disaster
Assistance OMB Office of Management and Budget ONR Office of National
Reconstruction, Jamaica RIG Regional Inspector General Tropical Storm
Program Tropical Storm Jeanne Recovery Program USAID U.S. Agency for
International Development

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separately.

United States Government Accountability Office

Washington, DC 20548

May 26, 2006

The Honorable Jim Kolbe Chairman Subcommittee on Foreign Operations,
Export Financing and Related Programs Committee on Appropriations House of
Representatives

Dear Mr. Chairman:

In September 2004, Hurricane Ivan struck several Caribbean islands,
including Grenada and Jamaica, where it killed 59 people and inflicted
damage of about $1.4 billion. In the same month, Tropical Storm Jeanne
struck parts of Haiti with heavy rains, causing flash floods that killed
more than 2,000 people, affected an estimated 300,000 others through loss
of homes, schools, and livelihoods, and caused an estimated $300 million
in damage. The United States and other donors1 responded initially to
these disasters by providing emergency relief, such as food, water,
medical supplies, and temporary shelter. In October 2004, recognizing the
need for longer-term recovery and reconstruction assistance, Congress
passed a supplemental appropriation allocating $100 million for additional
hurricane recovery efforts in the Caribbean.2 The U.S. Agency for
International Development (USAID), designated to lead the U.S.-funded
assistance, initiated the Hurricane Ivan Recovery and Rehabilitation
Program (Hurricane Ivan Program) in Grenada and Jamaica and the Tropical
Storm Jeanne Recovery Program (Tropical Storm Program) in Haiti in January
2005.3 Following discussions with the Office of Management and Budget
(OMB), USAID agreed to complete the programs by December 31, 2005-that is,
within 1 year of initiating the programs; this time frame is shorter than
for previous USAID disaster recovery and reconstruction programs, such as
USAID's program in Central America following Hurricane Mitch. In addition,
instead of transferring or directly hiring staff, as it has done in the
past, USAID hired a management firm, Wingerts Consulting, to quickly staff
and establish the programs in Grenada and Jamaica.

1Other donors' pledges for recovery assistance amounted to about $177
million in Grenada and about $23 million in Jamaica. In Haiti, pledges
amounted to about $16 million.

2Emergency Hurricane Supplemental Appropriations Act, 2005, Pub. L.
108-324, Div. B, Chapter 5 (Oct. 13, 2004).

3USAID allocated most of the appropriated funds to Grenada, Jamaica, and
Haiti, which sustained the heaviest damage in the storms; this report
focuses on the agency's work in these countries.

Having previously examined U.S. efforts to provide disaster recovery
assistance,4 we were asked to monitor USAID's delivery of the assistance
in the Caribbean. In this report, we (1) review the recovery and
reconstruction activities in Grenada, Jamaica, and Haiti, including the
status of the activities as of December 31, 2005; (2) identify factors
that affected USAID's ability to implement and complete the programs
within the 1-year time frame; and (3) assess USAID's use of guidance and
application of lessons learned from similar previous programs and its
efforts to draw lessons from the current programs.

To address these matters, we reviewed USAID's objectives and oversight
strategy for the Hurricane Ivan and Tropical Storm Programs. We made
several trips to Grenada and Jamaica and one trip to Haiti.5 In all three
countries, we reviewed program documents and interviewed USAID staff,
private contractors, and host government officials. We visited 80 project
sites, most of them randomly selected, in Jamaica and Grenada as well as
nine project sites in Haiti that were not randomly selected. We also
analyzed program expenditure and activity data, having assessed the data's
reliability and finding it sufficient for our purposes. We conducted our
work from March 2005 through May 2006 in accordance with generally
accepted government auditing standards. (See app. I for a more detailed
discussion of our scope and methodology).

                                Results in Brief

USAID completed many of the activities that it implemented in Grenada,
Jamaica, and Haiti within the 1-year time frame, but the agency required
additional time to finalize many construction-related projects. Of the
$92.4 million allocated for recovery and reconstruction in the three
countries, USAID expended $71.3 million, or about 77 percent. In Grenada
and Jamaica, USAID completed a range of non-construction-related recovery
activities, including providing business and agriculture recovery grants,
technical assistance to farmers, and grants to fisherfolk or artisans. In
Haiti, USAID's completed nonconstruction activities included restoring
irrigated farmland and hillsides, removing mud from streets and canals,
and issuing household support grants. USAID also initiated
construction-related projects, including repairing houses and public
facilities and building new homes in Grenada and Jamaica and repairing
homes, public facilities, and infrastructure in Haiti. However, in part
because of increases in the cost of materials and labor, USAID lowered
initial targets for many of these projects-for example, reducing new
housing targets in Grenada from 150 to 55, house repair targets in Jamaica
from 3,450 to 932, and house repair targets in Haiti from 3,000 to 600.
However, USAID contractors did not achieve the adjusted targets for 11 of
the 14 construction activities. In November 2005, USAID granted the
contractors in Grenada and Jamaica a 6-month extension to complete
approximately 240 new houses and finish other construction activities. In
September 2005, contractors in Haiti received an 18-month extension to
complete housing and infrastructure repairs but expected to finish these
projects by June 2006.6

4For example, see GAO, Foreign Assistance: Disaster Recovery Program
Addressed Intended Purposes, but USAID Needs Greater Flexibility to
Improve Its Response Capability, GAO-02-787 (Washington, D.C.: July 24,
2002); and Foreign Assistance: USAID's Earthquake Recovery Program in El
Salvador Has Made Progress, but Key Activities Are Behind Schedule,
GAO-03-656 (Washington, D.C.: May 15, 2003). See Related GAO Products.

5After our initial trip to Haiti in March-April 2005, the Department of
State restricted access to emergency personnel because of security
concerns.

Several factors hampered USAID's ability to implement and complete program
activities within the 1-year time frame. First, periods of severe weather
delayed construction and some agriculture activities in Jamaica as well as
some construction projects in Haiti. Second, coordination challenges in
Grenada and Jamaica negatively affected USAID's implementation and
completion of construction projects. For example, the Grenadian government
lacked a central agency to identify needs and coordinate hurricane
recovery efforts, and Jamaica's Office of National Reconstruction did not
complete certain construction activities it had agreed to, delaying
USAID's completion of new houses. Third, construction-related challenges,
including difficulty in identifying housing recipients who could
demonstrate land ownership, delayed construction activities in the three
countries. Finally, according to USAID officials, ongoing security
challenges disrupted the work in Haiti, leading, for example, to the
temporary evacuation of some USAID staff during the summer of 2005.

6The extensions that USAID granted to contractors in Grenada, Jamaica, and
Haiti entailed no additional cost to the agency.

USAID staff reported that a lack of guidance incorporating lessons learned
from previous USAID recovery and reconstruction programs led to design and
implementation challenges; further, the agency did not adopt prior
recommendations regarding time frames and staffing, resulting in
additional problems. Although USAID has managed several recovery and
reconstruction programs since 1999, it has not issued guidance that
incorporates lessons learned from designing and implementing such
programs. For example, if USAID officials had had access to lessons
learned regarding likely increases in postdisaster demand for construction
materials and labor, it might have helped them to establish more realistic
targets for activities to be achieved within a 1-year time frame. Staff
who designed the activities told us that they applied some lessons from
prior reconstruction programs-for example, hiring monitoring firms to
assist with technical and financial oversight of program activities.
However, in agreeing to complete activities by December 31, 2005, USAID
did not take into account lessons learned regarding implementation time
frames. It also faced trade-offs in trying to complete a broad spectrum of
activities within 1 year while ensuring that activities had the intended
impact of helping beneficiaries find jobs in the postdisaster environment
and could be sustained by host government staff after the programs were
completed. For instance, to finish activities within the 1-year time
frame, USAID contractors in Grenada designed job skills training to last 6
weeks, but participants later reported that the training had been too
brief to develop some skills, such as those needed for construction work.
The contractors told us that a longer time frame would have allowed them
to assess and adjust the training to make it more sustainable. In
addition, at the time of our review, the agency had not adopted prior GAO
and USAID recommendations for revising agency procedures to quickly hire
or reassign staff with technical skills to manage disaster recovery
activities. In order to quickly staff its program in Grenada, which has no
USAID mission, the agency hired a management and oversight firm to manage
program activities. However, USAID staff and contractors told us that the
use of this firm led to several implementation problems, such as confusion
about roles and responsibilities and redundant layers of oversight. USAID
staff and contractors in all three countries are recording lessons learned
that could be valuable in future efforts.

We are recommending that, to better facilitate the design and
implementation of USAID's disaster recovery and reconstruction programs
and address ongoing staffing issues, the USAID Administrator develop
guidance that incorporates lessons learned from the Hurricane Ivan,
Tropical Storm Jeanne, and other USAID recovery and reconstruction
programs and revise staffing procedures to facilitate the rapid
reassignment or hiring of needed personnel for longer-term recovery
programs. We provided a draft of this report to USAID, the Department of
State, and OMB. We received a formal comment letter from USAID (see app.
III), in which they agreed with our recommendations. USAID and OMB
provided technical comments that we incorporated, as appropriate. The
Department of State provided no comments.

                                   Background

In September 2004, four major hurricanes and storms, including Ivan and
Jeanne, caused extensive damage in the Caribbean, particularly in Grenada,
Jamaica, and Haiti. Figure 1 shows the paths of Hurricane Ivan and
Tropical Storm Jeanne and describes the extent of damage in the three
countries.

Figure 1: Areas and Extent of Hurricane Damage in Grenada, Jamaica, and
Haiti

Note: Map is not drawn to scale.

U.S. Emergency Relief and Immediate Recovery Assistance

USAID's Office of Foreign Disaster Assistance (OFDA) provided emergency
relief, such as food, water and sanitation, and shelter, to address the
urgent needs of those affected by the storms. Following OFDA's relief
efforts in response to Hurricane Ivan, USAID directed existing agency
funding to Grenada and Jamaica-$3.2 million and $7.3 million,
respectively-for immediate recovery activities, including clearing
farmland, cleaning up communities, and repairing houses and schools, that
were carried out through June 30, 2005. Soon after Tropical Storm Jeanne
struck Haiti, the U.S. government provided $11.8 million for immediate
emergency relief and recovery assistance, including emergency food and
water, as well as for cleaning up communities.

U.S. Recovery and Reconstruction Assistance

Of the $100 million supplemental assistance that Congress approved for
hurricane recovery and reconstruction activities in the Caribbean, USAID
allocated $92.4 million to Grenada, Jamaica, and Haiti.7 Figure 2 shows
the amount and percentage allocated to each country.

Figure 2: Recovery and Reconstruction Allocations by Country

Note: Dollar amounts do not add due to rounding.

Lacking a mission in Grenada, the agency administered the Hurricane Ivan
Program from its Jamaica mission and Barbados satellite office, and it
administered the Tropical Storm Program from its Haiti mission. Using a
new approach to its program staffing, rather than reassign USAID staff or
hire personal services contractors,8 the agency hired Wingerts Consulting
to manage and oversee project activities in Grenada and Jamaica.
Wingerts's responsibilities included monitoring program activities,
reporting progress to the USAID mission in Jamaica, and coordinating
USAID's efforts with the Grenadian and Jamaican governments and with other
donors.

7USAID also allocated about $5.6 million to OFDA as reimbursement for
relief efforts and $2 million to the Bahamas, Tobago, and the Caribbean
Community islands, which sustained some damage from Hurricane Ivan.

USAID created special objectives for each country that defined the target
areas for the recovery and reconstruction funding. For Grenada and
Jamaica, the supplemental funding expanded the initial emergency, or a
short-term response and aimed to help people quickly rebuild their
communities, enhance and improve their skills, provide limited income
support, and resume their path of sustainable development through
activities that provide immediate income, skills training and employment
opportunities. In Haiti, supplemental funds aimed to meet the immediate
needs of Haitians affected by the tropical storm, help them regain sources
of economic activity, and help them prepare for future natural disaster
threats. According to USAID, recovery and reconstruction programs are
essentially development programs with short time frames but share the same
objectives of sustainable growth and prosperity.

 USAID Completed Numerous Recovery Efforts within 1 Year but Granted Extensions
                         for Many Construction Projects

USAID completed many activities it implemented in Grenada, Jamaica, and
Haiti by December 31, 2005. Of the $92.4 million allocated for recovery
and reconstruction across the three countries, the agency expended $71.3
million. The agency implemented a variety of non-construction-related
activities-for example, providing business rehabilitation grants in
Grenada and Jamaica and implementing community cleanup activities in
Haiti-and met or exceeded its targets for these projects within the 1-year
time frame. In addition, it implemented a number of construction-related
projects, such as repair and building housing and infrastructure. However,
although USAID reduced targets, in part because of cost increases for
these projects in all three countries, USAID contractors did not complete
many of them by December 31, 2005-in particular, new housing
construction-and required extensions to finish these projects.

8USAID defines its workforce as comprising individuals with whom it has an
employer-employee relationship. The Federal Acquisition Regulations define
a personal services contract as one that makes the contractor appear as a
government employee by the nature of the relationship that is established.
USAID is authorized by section 636(a)(3) of the Foreign Assistance Act of
1961, as amended, to contract with individuals for personal services
abroad. USAID's personal services contractors may be U.S. citizens, host
country nationals, or third country nationals.

USAID Expended Majority of Recovery Funds within 1 Year

As of December 31, 2005, USAID had expended approximately 77 percent of
the $92.4 million that it allocated for recovery efforts in the three
countries. Figure 3 shows program allocation and expenditure by country.

Figure 3: USAID Allocation and Expenditure for Disaster Recovery
Assistance for Grenada, Jamaica, and Haiti, as of December 31, 2005

USAID Implemented Various Nonconstruction Recovery Activities

USAID implemented a variety of non-construction-related activities to help
hurricane and storm survivors in Grenada, Jamaica, and Haiti recover from
the disasters, completing most of them within the 1-year time frame. USAID
generally reached or exceeded its targets for nonconstruction recovery
activities, despite having raised many of these targets after initiating
the activities. We visited a total of 37 non-construction-related sites to
observe USAID's progress and interview beneficiaries. Table 1 shows a
selection of USAID's initial and revised nonconstruction targets and its
completed activities, in Grenada, Jamaica, and Haiti as of December 31,
2005.

Table 1: USAID Key Nonconstruction-Related Recovery Activities in Grenada,
Jamaica, and Haiti, as of December 31, 2005

                                                                    Completed 
                                                    Revised activities (as of 
Key nonconstruction       Initial targets targets (as of      December 31, 
recovery activities        (January 2005) December 2005)             2005) 
Grenada                            1,600a          1,800             2,402 
                                                                              
People trained in                     200            200               192 
tourism, construction,                                                     
and other skills                      450          1,327             1,427 
                                                                              
Grants for small and                   35            155               100 
medium-size enterprises                                                    
                                          $8             $8                $8 
Grants and technical                                                       
assistance for farmers                 18             21                24 
                                                            
Grants and technical                                     
assistance for fisherfolk                                
                                                            
Government supported                                     
operations (dollars in                                   
millions)                                                
                                                            
Primary schools                                          
resupplied and                                           
re-equipped                                              
Jamaica                             2,500          2,451            11,478 
                                                                              
Grants to small and                 2,300          2,447             2,479 
medium-size enterprisesb                                                   
                                       1,500          2,700             2,855 
Technical assistance for                                                   
farmers                               100            100               120 
                                                                              
Grants for fisherfolk                 219             52                56 
                                                            
Grants for artisans                                      
                                                            
Primary schools and                                      
colleges resupplied and                                  
re-equipped                                              
Haitic                        5,600 acres    6,474 acres       5,264 acres 
                                                                              
Irrigated land restored       4,960 acres    4,960 acres       4,975 acres 
to full production                                                         
                                          16             16                19 
Land protected with                                                        
conservation methods                   61             51                 0 
                                                                              
Communities trained in          48,000 m3      48,000 m3         69,734 m3 
watershed management                                                       
                                       3,000          3,000             3,023 
Water associations                                                         
trained in watershed                   27             21                21 
management                                               
                                                            
Mud removed from urban                                   
streets and canals                                       
                                                            
Asset restoration grants                                 
                                                            
Communities trained in                                   
disaster preparedness and                                
                                                            
mitigation                                               

Source: GAO analysis of USAID data.

Notes: The table shows USAID's primary nonconstruction-related recovery
activities in the three countries; the agency conducted other
nonconstruction-related activities that are not shown.

aInitial target reflects tourism and construction skills only; other
skills were added later in the program and are reflected in the revised
target number.

bGrants to small and medium-size enterprises included assistance to
business owners and farmers.

cInitial targets for Haiti according to USAID's February 2005 Tropical
Storm Recovery Program report.

In all three countries, USAID provided assistance to revitalize businesses
and agriculture. In addition, in Haiti, USAID also helped communities
clear

away flood debris and take steps to prevent similar disasters in the
future. Following are descriptions of several USAID nonconstruction
activities in the three countries:

           o  In Grenada, USAID provided grants averaging about $6,300 to
           small businesses (those with 5 to 24 employees) and grants
           averaging about $15,000 to medium-sized businesses (those with 25
           to 75 employees) to reimburse them for hurricane-related repairs.
           We visited five grant recipients, each of whom reported using the
           grants to pay for repairs or purchase equipment. According to a
           survey conducted by the contractors that implemented these grants,
           about half of the businesses receiving assistance estimated that
           they reopened at least 6 months sooner than if they had had to
           finance the repairs themselves. Fisherfolk received grants
           averaging about $1,900 to replace fishing gear and equipment and
           repair boats. Many of the farmers and fisherfolk also received
           technical assistance-for example, farmers were taught techniques
           for turning backyard yam production into commercial production.

           o  In Jamaica, USAID grants to poultry farmers allowed them to buy
           egg grading and cold storage equipment, which in turn will enable
           them to increase production and incomes. We visited six
           horticultural farmers who received grants from USAID consisting of
           a technology package, such as seedling nurseries, drip irrigation
           systems, or integrated pest management systems. According to USAID
           staff, they were able to provide an unexpectedly large number of
           grants (11,478 versus the revised target of 2,451) to small and
           medium-size enterprises because the implementing team decided to
           make several grants to individual beneficiaries as an incentive
           for beneficiaries to continue to adopt various new technologies
           and practices. According to a November 2005 USAID report,
           agricultural production for farmers who received grant and
           technical assistance through the program was estimated to have
           increased by 41 percent compared with pre-Hurricane Ivan
           production levels. USAID also conducted workshops that taught
           artisans how to improve and develop products, procure goods and
           services, and package and label their merchandise. In addition,
           fisherfolk in Jamaica received grants and disaster preparedness
           training. For example, training courses in "Safe Seamanship and
           Environmental Management" were delivered to 295 fisherfolk.

           o  In Haiti, USAID cleared streets of mud and improved urban
           drainage that had been damaged from flooding. In addition, USAID
           implemented a cash-for-work program that paid local workers about
           $2 per day for assisting with various activities throughout the
           program, including road and schools repair, mud removal, and
           clearing of urban drains (see fig. 4). Further, USAID funded
           training in disaster preparedness and response that, according to
           a report by a USAID contractor, aimed to "raise disaster
           awareness, reduce risks, and prepare for contingencies in
           vulnerable local communities and municipalities." Among the topics
           covered were forming community emergency response teams,
           designating first responders to coordinate emergency activities,
           and developing risk management and mitigation plans.

           Figure 4: USAID-Supported Drainage Canal Cleanup in Haiti

           USAID initiated construction-related projects to repair or replace
           hurricane and storm-damaged structures in each of the three
           countries. However, USAID contractors did not complete a number of
           these projects, although USAID reduced its targets for many of the
           projects. According to USAID staff and contractors, rising costs
           in all three countries were a factor in USAID's decision to reduce
           construction targets. According to an April 2006 Regional
           Inspector General (RIG) audit of the Hurricane Ivan Program,9 the
           high cost of housing construction was due, in part, to the
           contractor's unfamiliarity with the local market, which led to the
           negotiation of unfavorable subcontracts. The report also indicated
           that the cost of houses financed by USAID in Grenada was 37
           percent to 49 percent higher than comparable houses built by the
           Grenadian Housing Authority; and, in Jamaica, USAID-funded houses
           were more than double the cost of houses built by the Jamaican
           government. In addition, in Haiti, USAID staff indicated that a
           detailed needs survey found that the costs of material and labor
           needed to make repairs had more than doubled since the initial
           estimates. Table 2 shows a selection of USAID's initial and
           revised construction targets and its completed activities, in
           Grenada, Jamaica, and Haiti as of December 31, 2005.

USAID Began Many Construction-Related Projects but Did Not Complete All

9USAID, Office of the Inspector General, Audit of USAID/Jamaica's
Hurricane Recovery and Rehabilitation Activities, Audit Report No.
1-532-06-004-P (San Salvador, El Salvador, April 2006).

Table 2: USAID Key Construction-Related Recovery Activities in Grenada,
Jamaica, and Haiti, as of December 31, 2005

                                                  Revised                     
                                                  targets                     
Key                                             (as of           Completed 
construction-related   Initialtargets(January December   activities (as of
recovery activities                     2005)    2005)  December 31, 2005)
Grenada                                 1,675      650               1,100 
                                                                              
Houses repaired or                        150       55                   0 
rebuilt                                                                    
                                               3        5                   7 
New houses built                                                           
                                              12       17                  20 
Tourist sites repaired                                                     
                                               1        0                   0 
Schools repaired                                       
                                                          
Community colleges                                     
repaired                                               
Jamaica                                 3,450      932                 762 
                                                                              
Houses repaired                           200      186                   0 
                                                                              
New houses built                          440      200                  66 
                                                                              
Sanitation and septic                     219       47                  46 
systems repaired                                                           
                                               3        2                   2 
Primary schools and                                    
colleges repaired                                      
                                                          
Teachers colleges                                      
repaired                                               
Haiti                                   32 km    32 km                   0 
                                                                              
Roads repaired                              0        2                   0 
                                                                              
Bridges constructed                        20       20                  13 
                                                                              
Schools repaired                        3,000      600                 476 
                                                          
Houses repaired                                        

Source: GAO analysis of USAID data.

Note: The table shows USAID's primary construction-related recovery
activities in the three countries; the agency conducted other
construction-related activities that are not shown.

In Grenada and Jamaica, USAID negotiated 6-month extensions of the
bilateral agreements with the respective host governments in December 2005
and, subsequently, granted contractors extensions of varying lengths based
on the expectation that they could complete activities by June 30, 2006.
In Haiti, USAID granted the contractor an 18-month extension in September
2005 to complete major infrastructure repair on a road and bridge;
however, USAID officials managing the program said they expected to
complete these activities by June 2006.10

In Grenada and Jamaica, USAID's construction efforts have focused
primarily on repairing and rebuilding houses and building new homes, and
in Haiti, on repairing infrastructure, public facilities, and houses.
Following are descriptions of several of USAID's construction-related
projects.

           o  In Grenada, USAID is building 55 new houses on the sites of
           homes that had been destroyed by the hurricane. The new houses
           consist of lumber over a concrete slab and include septic systems
           and electrical connections. Of the 55 homes, 36 have an area of
           400 square feet and 19 have an area of 650 square feet, with the
           size of the house depending on the size of the household. We
           visited 11 housing construction sites in August 2005 and revisited
           five of them in December, at which time, for the most part,
           construction was just beginning. In addition, USAID has initiated
           repairs of houses, tourist sites, and schools, among other
           buildings (see fig. 5).

10USAID reported that the extensions in all three countries imposed no
additional program costs.

Figure 5: USAID-Funded School Repair in Grenada

           o  In Jamaica, USAID is constructing 220-square-foot
           concrete-block houses in two sites provided by the Jamaican
           government. The Jamaican Office of National Reconstruction agreed
           to provide septic systems and electrical connections for the
           houses. Most of the beneficiaries are families whose houses were
           destroyed by the hurricane because they were close to the shore;
           the new housing sites are near the old sites but a safe distance
           from the shoreline. We visited the two sites in the early stages
           of construction and several months later, after construction had
           begun. As of January 2006, construction was well under way in the
           two communities, but none of the houses were complete.

           o  In Haiti, USAID funded the construction of a bridge and the
           repair of a national road that runs from Gonaives to Cap-Haitien.
           According to USAID's contractor implementing infrastructure
           activities, repairs to the road will have a significant impact on
           the local economy by restoring farm-to-market transportation and
           supporting USAID's other rehabilitation projects in the area.
           According to USAID staff, as of December 2005, 60 percent to 70
           percent of the road was completed.

           USAID's implementation and completion of recovery activities in
           Grenada, Jamaica, and Haiti within the 1-year time frame were
           hampered by several factors. Severe weather in 2005 delayed the
           progress of some activities, in particular the reconstruction of
           houses in Jamaica and infrastructure in Haiti. Coordination
           challenges in Grenada and Jamaica contributed to delays in the
           implementation and completion of program activities. In addition,
           USAID contractors encountered various construction-related
           challenges, such as shortages of materials and labor, and
           difficulty in fulfilling USAID requirements. Haiti faced continued
           security challenges that limited access to recovery sites,
           consequently delaying progress.

           Hurricanes and heavy rains in 2005 affected the progress of USAID
           reconstruction and recovery activities in Jamaica and Haiti. In
           Jamaica, two hurricanes during the summer of 2005, as well as
           heavy rain in October and November, contributed to delays in
           housing reconstruction and some agriculture activities, including
           the training of farmers. In Haiti, a heavier than usual rainy
           season delayed some USAID construction activities. Some structures
           that protected ongoing work on riverbank repair and irrigation
           pumps were washed away, and protective dikes had to be rebuilt.
           The heavy rain also damaged roads in many of the project areas,
           making it difficult to transport construction materials and field
           staff.

           USAID faced several coordination challenges in Grenada, owing in
           part to the agency's lack of a permanent presence in the country,
           which affected its ability to implement recovery activities. In
           Jamaica, USAID encountered challenges in coordinating with the
           government, which negatively affected its ability to complete new
           housing.

           o  Coordination challenges in Grenada. Grenada lacked a central
           coordinating agency immediately following the hurricane to
           facilitate disaster recovery within the country. Because USAID has
           no mission in Grenada, staff and contractors had to work with
           various government ministries to initiate the recovery process. To
           address the lack of a central agency, USAID and other donors
           provided funds to help Grenada establish the Agency for
           Reconstruction and Development to coordinate donor hurricane
           recovery efforts; however, establishing the agency took several
           months, contributing to delays in certain activities, such as
           developing criteria for, and identifying, beneficiaries to receive
           housing repairs and reconstruction.

           o  Coordination challenges in Jamaica. The government of Jamaica
           did not complete certain construction activities as agreed with
           USAID, delaying USAID's completion of new houses. Jamaica's Office
           of National Reconstruction (ONR), established by the government to
           coordinate Hurricane Ivan recovery activities, verbally agreed to
           provide, by December 31, 2005, concrete bases and install water,
           roads, and drainage infrastructure at the two sites selected for
           new USAID housing construction. However, USAID did not sign a
           memorandum of agreement with the Jamaican government that clearly
           designated the construction responsibilities of each party and
           deadlines for completion.11 According to USAID officials and our
           observations during site visits, ONR made slow progress in
           fulfilling its part of construction activities and as of January
           2006 had not installed electricity and septic systems, although
           USAID's construction of many houses was close to completion. As of
           March 2006, ONR had not completed the construction activities that
           it had agreed with USAID to complete by December 31, 2005.

           USAID contractors encountered several challenges that slowed the
           agency's implementation and completion of construction projects in
           all three countries. These challenges included shortages of
           materials, USAID's policies regarding land titles and bank
           guarantees, and difficulties working with nongovernmental
           organizations (NGO) and subcontractors.

           o  Materials shortages. In Grenada, disruptions following the
           hurricane, as well as the island's relatively remote location, led
           to shortages of construction materials that periodically delayed
           housing repairs and new housing construction. According to USAID,
           obtaining building materials in Grenada became more challenging
           following Hurricane Emily in 2005. In Jamaica, according to USAID,
           increased duties on imported cement, heavy rains that soaked the
           cement quarries, and a labor strike that occurred in the country's
           only cement factory led to shortages that delayed housing repairs
           and construction. As of March 2006, USAID reported that
           construction in Jamaica continued to be slowed by a shortage of
           cement because the production site that supplies the region shut
           down after producing low-quality cement.

           o  Difficulty in establishing land titles. In Grenada,
           difficulties in establishing land title or ownership caused
           construction delays. A USAID housing contractor in Grenada told us
           that although it originally identified 400 to 500 prospective
           beneficiaries who met selection criteria established by the
           Grenadian government, many of these people lacked the land titles
           or proof of ownership, which USAID required of new-housing
           beneficiaries.12 Because the process of verifying ownership was so
           time consuming, the contractor eventually ran advertisements
           soliciting respondents who met the selection criteria and had
           proof of land ownership.

           o  Delays in obtaining bank guarantees. In Haiti, delays
           encountered by contractors seeking bank guarantees contributed to
           implementation delays of some construction projects. USAID staff
           in Haiti explained that the agency requires construction
           contractors to provide a bank guarantee in order to receive
           advance disbursements to buy materials and pay for labor, which
           USAID officials said is common commercial practice. However,
           Haiti's economic situation made it difficult for local contractors
           to obtain bank guarantees, even when the contractors were
           reputable and had a valid contract with an international
           organization. Because contractors could not begin work without the
           guarantees, some construction activities were delayed. For
           example, according to USAID officials, one highway construction
           contractor lost a month and a half of work time and another
           contractor lost 2 months while obtaining bank guarantees.

           o  NGO-related and subcontractor challenges. In Grenada,
           contractors encountered challenges in working with local NGOs and
           subcontractors. The implementing contractor in Grenada relied on
           NGOs to help identify people who met government criteria to
           receive housing support. However, according to the contractor, the
           NGOs had difficulty quickly selecting beneficiaries and, as a
           result, housing construction was delayed. In Jamaica, USAID worked
           with NGOs to perform housing repairs. According to USAID staff, it
           was difficult to attract NGOs that could fulfill the agency's
           documentation and reporting requirements in order to receive
           grants for the housing repairs. In addition, according to an April
           2006 RIG report, the sole subcontractor hired to build houses
           performed poorly, which also contributed to construction delays.

           In Haiti, kidnappings and continued violence in areas affected by
           the tropical storm presented security challenges that disrupted
           USAID's recovery work. According to USAID officials, most security
           issues that delayed program activities occurred in Haiti's
           capital, Port-au-Prince, where frequent kidnappings and violence
           made the port zone extremely dangerous. In addition, attacks on
           port officials prompted them to strike for better security, and
           sometimes delayed distribution of materials. USAID officials told
           us that the lack of security required USAID's contractors to take
           precautionary measures, such as daily monitoring of the security
           situation, and invest additional resources to protect staff and
           activity sites before undertaking activities. In addition,
           security concerns led to the temporary evacuation of most
           direct-hire USAID staff from Haiti during the summer of 2005.
           Security concerns also limited USAID staff's and contractors'
           access to project sites and ability to provide assistance in
           certain areas. For example, U.S. embassy security policies
           required special approval for travel to Gonaives-one of the areas
           most affected by the tropical storm and a target for USAID
           assistance-because of continued violence there.

           USAID has not issued recovery and reconstruction program guidance
           that incorporates lessons learned from previous programs; as a
           result, USAID staff were challenged to find information to guide
           the design and implementation of the Hurricane Ivan Program,
           leading to an ad hoc design process and implementation delays. In
           addition, although it applied some lessons learned from its
           Hurricane Mitch and other past programs, USAID did not apply
           lessons and recommendations regarding time frames and staffing,
           and as a result, USAID staff tasked with managing the Caribbean
           disaster recovery programs faced challenges similar to those
           encountered in prior programs. USAID staff and contractors stated
           that they are currently recording lessons learned from the
           Hurricane Ivan and Tropical Storm Programs.

           Although USAID has managed several large disaster recovery and
           reconstruction programs since 1999,13 USAID has not provided
           guidance specific to these programs that includes lessons learned
           from previous programs. USAID has issued guidance for OFDA
           emergency assistance14 that serves as a reference both for OFDA
           staff and for the private and public organizations that work with
           OFDA in providing emergency assistance. However, this guidance
           does not address the design and implementation of the recovery and
           reconstruction activities that USAID provides following OFDA's
           emergency response. In addition, the agency has not issued
           guidance that incorporates lessons learned from designing and
           implementing its prior recovery and reconstruction programs. For
           example, for our 2002 report on USAID's assistance after
           Hurricanes Mitch and Georges,15 USAID staff and other federal
           agencies involved in the recovery efforts in Latin America
           provided us with some lessons learned and ideas for improving the
           delivery of future disaster recovery assistance, such as the need
           to establish accountability mechanisms as part of program design,
           hire firms to provide technical oversight, and develop
           fixed-amount reimbursable contracts. Although USAID recorded some
           lessons learned from its Hurricanes Mitch and Georges recovery
           program, this document, unlike its OFDA guidance, has remained in
           draft form since 2002, has not been formally issued or approved by
           the agency, and may not be readily available to all staff.16

           USAID staff assigned to manage the Hurricane Ivan Program, who did
           not have prior experience in managing recovery and reconstruction
           activities, reported that the lack of guidance and access to
           lessons learned created challenges in planning and managing a wide
           range of activities. According to USAID staff designing the
           Hurricane Ivan Program, the lack of ready access to lessons
           learned from previous recovery and reconstruction programs
           resulted in an ad hoc approach to planning recovery activities.
           USAID headquarters officials told us that no formal agency
           guidance was available to assist them in planning the recovery
           effort; consequently, they had to search for documents and contact
           staff involved in previous USAID disaster recovery efforts to
           understand how previous programs were implemented.

           Officials at USAID headquarters told us that some program planning
           during disaster recovery situations is by necessity country
           specific and based on the political, economic, and disaster
           situation in the affected country. However, a USAID official
           stated that operational guidance would have facilitated the design
           process and that ready access to lessons learned could have
           prevented some mistakes. For example, if USAID officials had had
           access to lessons learned regarding likely increases in
           postdisaster demand for construction materials and labor, it might
           have helped them to establish more realistic targets for
           activities to be achieved within a 1-year time frame. With regard
           to construction and repair, important lessons from prior USAID
           disaster recovery programs include the need to account for the
           difficulties involved with hiring and supervising contractors
           unfamiliar with USAID requirements, selecting beneficiaries and
           verifying land titles.

           In designing and implementing recovery efforts in Grenada,
           Jamaica, and Haiti, USAID applied some lessons from previous
           disaster recovery programs. However, the agency did not apply
           lessons and recommendations regarding time frames and staffing for
           recovery programs. As a result, USAID staff tasked with managing
           the Caribbean disaster recovery programs faced challenges that
           could have been avoided if they had had access to lessons learned
           from prior programs; in addition, staffing issues remain
           unaddressed.

           Despite lacking ready access to lessons learned, USAID
           headquarters officials that designed the recovery programs gained
           access to draft documents that they said allowed them to apply
           some lessons learned from USAID's Hurricane Mitch recovery
           program. For instance, referring to lessons regarding
           accountability and sustainability, officials involved the Regional
           Inspector General to ensure that appropriate accountability
           mechanisms were in place and incorporated the concept of "build
           back better," such as rebuilding hurricane-affected infrastructure
           to better withstand future natural disasters. According to USAID,
           the team implementing business, agriculture, and training
           activities in Jamaica followed lessons learned from Hurricane
           Mitch regarding hiring contractors with proven track records.
           USAID staff in Haiti also reported that some lessons learned from
           the Hurricane Georges recovery program, which included projects in
           Haiti, had been incorporated into their program's design,
           including

           o  simplifying the task order approval process for hiring
           contractors,

           o  working with community-based organizations to implement
           recovery activities, and

           o  hiring monitoring firms to assist with technical and financial
           oversight of program activities.

           In agreeing to a 1-year time frame for the Hurricane Ivan and
           Tropical Storm Programs, USAID may have limited the impact and
           sustainability of some activities and did not take into account
           lessons learned from the Hurricanes Mitch and Georges effort.
           According to OMB officials responsible for foreign affairs
           programs, the 1-year time frame was developed to speed its
           completion of recovery activities relative to previous USAID
           disaster recovery efforts and, in response to concerns expressed
           by members of Congress that these emergency supplemental resources
           be expended in a timely manner, to assist with recovery efforts
           and not divert funds to regular long term development programs.17
           However, our recent interviews with USAID staff and contractors,
           as well as previous GAO work, suggests that in agreeing to the
           December 31, 2005, deadline, USAID faced a trade-off in trying to
           complete a broad spectrum of activities within the 1-year time
           frame and ensure that activities supported through these programs
           have the intended impact in helping beneficiaries recover,
           rebuild, and find jobs in the postdisaster environment and can be
           sustained by host government staff after the programs end.

           o  In Grenada, USAID provided training in various trades and also
           paid participants a stipend while they attended 6-week courses.
           However, in a later evaluation of this program component, the
           contractors conducting the training reported that participants had
           commented that 6 weeks was too short to fully develop some skills,
           such as those needed for construction; however, because the
           contractor did not assess the training until the end of the 1-year
           time frame, they were unable to modify the training design. The
           contractor reported that a longer program time frame, such as 18
           months, would have allowed them to assess the training's
           results-for instance, by tracking the number of people that found
           jobs after being trained-and adjust the design to increase its
           impact. The contractors also found that the time frame limited
           their ability to assess the results of training in hotel services,
           because many of the islands' hotels were still closed for repair
           during the year that training was provided. We interviewed 19
           persons who participated in USAID's skills training in Grenada and
           found that fewer than half were employed 3 to 6 months after
           completing it.18

           o  In Haiti, USAID officials said that although they tried to
           select projects that fit the needs of affected areas, the 1-year
           time frame had implications for the sustainability of some program
           activities. For example, the officials explained that their
           activities included hillside stabilization and the development of
           an early warning system to be transferred to the government of
           Haiti at the program's conclusion. However, the USAID officials
           said that 1 year was not enough time to implement and test some
           activities, and train government staff to take them over. USAID
           officials said that 2 years would have been a more reasonable time
           frame.

           Our prior assessments of the agency's Hurricane Mitch recovery
           program highlighted some of the trade-offs in trying to design
           activities that are sustainable and can be completed within a
           short time frame. In our 2002 assessment of USAID's administration
           of disaster recovery assistance after Hurricanes Mitch and
           Georges,19 we reported, based on responses from USAID staff and
           other agencies involved in providing the assistance, that "the
           December 31, 2001, deadline was a major factor in how they
           planned, designed, and implemented their disaster recovery
           activities, and it also affected the extent to which
           sustainability could be built into the program." For example, one
           agency involved in the Mitch recovery reported that the deadline
           limited project sustainability because it did not allow enough
           time to complete training for local entities. Another agency said
           future projects should have follow-on activities to assess the
           implementation of technical guidance and training provided. USAID
           officials in the Dominican Republic acknowledged that they
           selected some activities because they knew they could complete
           them by the program deadline, despite recognizing that other
           activities might have achieved greater sustainability.

           USAID did not adopt several prior recommendations that could have
           helped it to more rapidly hire and transfer staff in response to
           recovery and reconstruction needs, and as a result of hiring
           Wingerts Consulting to quickly staff the Hurricane Ivan Program in
           Grenada and Jamaica, the agency encountered additional challenges.
           In our 2002 report,20 we observed that USAID did not have the
           "surge capacity" to quickly design and initiate a large-scale
           infrastructure and development program with relatively short-range
           deadlines (2.5 years) while providing emergency relief and initial
           reconstruction assistance and managing its regular development
           program. Based on these findings, we recommended that USAID
           develop and implement procedures that would (1) allow it to
           quickly reassign key personnel in postemergency and postcrisis
           situations and (2) allow missions to hire personal services
           contractors to augment staff on an expedited basis.21 In addition,
           USAID's draft document outlining lessons learned from its
           Hurricane Mitch program indicates that a shortage of qualified
           engineering and technical staff constrained the implementation of
           the program; the document recommends designating an official to
           identify staffing needs quickly and take action to address them.22
           USAID agreed with the recommendations in our 2002 report but as of
           April 2006 had not taken steps to respond to them; it also had not
           implemented the recommendations in its 2002 draft lessons-learned
           report. In addition, we recently reported that USAID had not
           staffed several positions that it considered critical to essential
           technical oversight of its tsunami reconstruction programs in
           Indonesia and Sri Lanka, indicating that staffing these types of
           programs remains a challenge.23

           USAID decided to hire Wingerts Consulting to manage and oversee
           the program in Grenada, where USAID has no permanent presence, and
           assist with oversight in Jamaica. According to USAID's Mission
           Director in Jamaica and other staff, factors influencing the
           decision included the following:

           o  The mission needed assistance in initiating recovery activities
           and personnel with technical skills to oversee disaster recovery
           activities, particularly construction.

           o  The agency's process for hiring personal services contractors
           can take up to 6 months, and given the 1-year time frame, staff
           were needed quickly.

           o  Hiring a consulting firm provided the agency the flexibility to
           acquire short-term staff with skills needed for specific program
           activities as well as to replace staff when their skills were no
           longer needed.

           According to USAID's Regional Inspector General, USAID staff, and
           contractors, the agency's decision to hire Wingerts Consulting to
           oversee the program in Grenada and Jamaica led to additional
           challenges.

           o  In its April 2005 report, USAID's RIG found that Wingerts's
           roles and responsibilities in monitoring the program's
           implementation had not been clearly defined, making it difficult
           for contractors to implement the program, and for USAID staff to
           manage program activities. USAID subsequently refocused Wingerts's
           responsibilities primarily on providing technical oversight and
           supporting the USAID permanent staff responsible for various
           program components in Grenada and Jamaica. It took two months
           after the Wingerts contract was signed to more clearly define each
           party's roles and responsibilities.24

           o  USAID staff and contractors told us that they were uncertain
           about Wingerts's role in managing the program. In addition,
           according to USAID contractors, the added layer of oversight that
           Wingerts provided sometimes created tension and confusion because
           contractors were still required to report to USAID staff
           overseeing their program activities in Jamaica and Barbados. In
           its April 2006 follow-up audit, the RIG noted that the Wingerts
           oversight model was problematic in that USAID's other contractors
           were not accustomed to having Wingerts perform functions that
           USAID staff would normally perform, and as a result, working
           relationships were uncomfortable.25

           Although USAID staff and contractors reported some challenges in
           working with Wingerts, USAID officials in Jamaica noted that the
           mission has benefited by engaging a contracting firm to fulfill
           specific functions, rather than hiring staff. According to USAID,
           by using a contractor to provide a range of management and
           oversight support, the mission created a structure that was highly
           flexible and allowed for quick responses to changing needs
           throughout the program. USAID also noted that in Grenada, where
           USAID has no presence, the contracting firm served an essential
           function of handling day-to-day interaction with the government in
           addition to managing the $8 million allocated for direct
           government support. While the use of Wingerts provided USAID with
           flexibility, USAID staff and the U.S. embassy in Grenada said that
           temporarily relocating USAID permanent staff or personal services
           contractors to manage recovery efforts in the country would have
           been more efficient than using the management firm.

           As part of its internal evaluation of the Hurricane Ivan
           reconstruction, USAID staff and contractors are recording lessons
           learned, including an assessment of the program's economic impact
           and whether the program helped the countries to "build back
           better" and prepare for future disasters. The staff and
           contractors told us in December 2005 that they would incorporate
           this information into their final program summary, which they
           expected to complete in May 2006. Staff at the Haiti mission told
           us that they were recording lessons learned from the Tropical
           Storm Program disaster mitigation activities and that overall
           lessons learned will be included in the final program report.
           However, we have not yet learned whether USAID headquarters
           intends to incorporate lessons learned from the Caribbean programs
           into guidance that would be available to staff implementing future
           recovery and reconstruction programs. (See app. II for our summary
           of lessons learned reported by U.S. officials and contractors
           involved in the Hurricane Ivan and Tropical Storm Programs as well
           as for lessons culled from our and USAID's reviews of its previous
           disaster recovery programs.)

           Disaster recovery and reconstruction assistance is an important
           component of USAID's development assistance portfolio, providing a
           bridge between its emergency relief efforts and its long-term
           development assistance. In responding to the Caribbean disasters,
           USAID provided a wide range of recovery and reconstruction
           support. However, despite having administered several large-scale
           disaster recovery programs in Latin America, the Caribbean, and
           Asia since 1999, USAID has not issued guidance for recovery and
           reconstruction programs that incorporates lessons learned from its
           prior efforts, leading to challenges in designing and implementing
           the recovery and reconstruction activities discussed in this
           report. In addition, although USAID and GAO have previously
           documented USAID's difficulties in quickly staffing its recovery
           and reconstruction programs and have made recommendations to
           assist USAID in correcting these problems, these issues remain
           unaddressed. As a result, the agency is likely to be unprepared to
           rapidly recruit and mobilize technically skilled staff for its
           next disaster recovery program.

           To better facilitate USAID's ability to design and implement
           future disaster recovery programs and address its previously
           documented recurring staffing challenges, we recommend that the
           USAID Administrator take the following two actions:

           o  Develop disaster recovery and reconstruction program guidance
           that incorporates lessons learned from the Hurricane Ivan Recovery
           and Reconstruction Program and Tropical Storm Jeanne Recovery
           Program as well as previous disaster recovery programs.

           o  Revise staffing procedures to allow the agency to more quickly
           reassign or hire key personnel, either to augment staff
           responsible for disaster recovery efforts in countries with a
           USAID mission or to manage efforts in countries where USAID does
           not maintain a permanent presence.

           We provided a draft of this report to USAID, the Department of
           State and OMB. We received a formal comment letter from USAID (see
           app. III), in which they agreed with our recommendations. USAID
           and OMB provided technical comments that we incorporated into the
           report, as appropriate. The Department of State had no comments.

           USAID agreed with our first recommendation and indicated it has
           established an agency task force for complex emergency and
           stabilization responses to allow it and other U.S. government
           agencies to undertake a structural approach based on past
           experience to provide an integrated and effective response to
           future disasters. Further, as part of its technical comments,
           USAID indicated that the Jamaica Mission has taken steps to
           document a draft list of lessons learned that will be included in
           the final report at the conclusion of the Hurricane Ivan program.
           USAID said these reports will be shared with USAID officials in
           Washington for developing guidelines for future disaster recovery
           programs and for inclusion in USAID's Center for Development and
           Evaluation databases.

           USAID also agreed with our second recommendation. The agency
           acknowledged that recent large-scale natural disaster and complex
           emergencies, including the Asian tsunami and conflicts in
           Afghanistan and Iraq, have revealed glaring gaps in the U.S.
           capacity to respond effectively, particularly for stabilization
           and reconstruction programs. In technical comments, USAID's
           Jamaica mission noted that its use of a management and oversight
           firm provided a highly flexible structure to respond quickly to
           changes in staffing needs throughout the program; however, USAID
           further recommended that any adjustment to the agency's policy
           address ongoing urgent needs to change staffing under projects
           with a short time horizon. To respond to staffing challenges,
           USAID has proposed the development of a "civilian surge capacity,"
           which, if approved and funded, would give USAID over a 3-year time
           period to develop short- to long-term staff on an as-needed basis,
           focusing on skill sets that USAID has identified as lacking
           sufficient capacity.

           We are sending copies of this report to interested congressional
           committees as well as the Administrator, USAID; Acting Director,
           OMB; and the Secretary of State. We will also make copies
           available to others upon request. In addition, this report will be
           available at no charge on the GAO Web site at http://www.gao.gov.

           If you or your staff have any questions about this report, please
           contact me at (202) 512-3149 or [email protected]. Contact points
           for our Offices of Congressional Relations and Public Affairs may
           be found on the last page of this report. GAO staff who made major
           contributions to this report are listed in appendix IV.

           Sincerely yours,

           David Gootnick Director International Affairs and Trade

           We were asked to periodically monitor the delivery of assistance
           under USAID's Hurricane Ivan Recovery and Reconstruction Program
           (Hurricane Ivan Program) and Tropical Storm Jeanne Recovery
           Program (Tropical Storm Program). In this report, we (1) review
           the recovery and reconstruction activities in Grenada, Jamaica,
           and Haiti, including the status of activities as of December 31,
           2005; (2) identify factors that affected USAID's ability to
           implement and complete the programs within the 1-year time frame;
           and (3) assess USAID's use of guidance and application of lessons
           learned from similar previous programs as well as its efforts to
           draw lessons from the current programs.

           To determine the status of the programs, we initially reviewed the
           supplemental appropriation language passed in 2004 and USAID
           documents that outline special objectives for each country and
           interviewed program officials regarding program goals. We also
           made three monitoring trips to Grenada, two trips to Jamaica, and
           one trip to Haiti.1 The information on foreign law in this report
           does not reflect our independent legal analysis but is based on
           interviews and secondary sources. After our initial monitoring
           trip to Haiti, our ability to travel there was curtailed when,
           because of security concerns, the U.S. Department of State
           restricted country access to emergency personnel only. Therefore,
           after the initial trip, we reviewed monthly reports and held
           periodic conference calls with USAID staff and contractors to
           discuss the status of the recovery program in that country. During
           our monitoring trips to Grenada and Jamaica, we conducted document
           reviews and held interviews with USAID staff as well as
           contractors to discuss program progress, determine compliance with
           established requirements set by audit entities, and learn how
           funding allocation decisions were made and tracked. We also met
           with private contractors and subcontractors, and host government
           officials involved in the recovery efforts to discuss program
           implementation and progress. In Grenada, we interviewed 19
           attendees of the skills training program to get a sense for the
           skills that were taught and the extent to which the training
           provided employment opportunities for the attendees. In addition,
           we conducted field visits to various project sites to observe the
           progress of activities and verify the extent to which objectives
           and timelines were being met. We visited a random selection of 80
           project sites in Jamaica and Grenada, and 9 project sites in Haiti
           that were not randomly selected due to security restrictions and
           our inability to visit following our initial information gathering
           trip. (See table 3.)

           Table 3: Number and Types of Activities at Project Sites GAO
           Visited in Grenada, Jamaica, and Haiti

           Source: GAO.

           aWe visited 11 sites in August 2005 and revisited 5 of these sites
           during December 2005 to assess progress.

           bWe randomly selected housing repair sites, which then were used
           by USAID to coordinate visits based on their proximity to
           Kingston.

           cTwo of these sites were not randomly selected.

           dSite visits in Haiti were not randomly selected.

           We assessed factors affecting the implementation and completion of
           program activities by reviewing USAID monthly reports and
           interviewing USAID staff, contractors, and host government
           officials overseeing the various program activities during our
           monitoring trips to Grenada and Jamaica. For Haiti, during our
           periodic conference calls, we discussed implementation and
           completion challenges with USAID staff and contractors with
           oversight responsibility for the various program components.

           To assess USAID's application of lessons learned from previous
           disaster recovery programs, we reviewed reports from prior USAID
           recovery efforts and interviewed agency officials in Washington,
           D.C., Grenada, Jamaica, and Haiti as well as contractors. We
           reviewed documentation on lessons learned that USAID officials had
           compiled following the Hurricane Mitch recovery program in Central
           America. We further reviewed reports on disaster relief from
           various international organizations, such as the World Bank, that
           detailed lessons learned from other disaster recovery efforts. Two
           members of our audit team also attended a Caribbean Basin
           conference that highlighted disaster preparedness and mitigation
           strategies, including strategies for funding reconstruction,
           whether building codes should be regionally or nationally applied,
           and how the private sector can contribute to effective disaster
           preparedness and mitigation strategies. Finally, we collated
           lessons learned in a separate appendix (see app. II) based on
           interviews with staff and contractors administering the Hurricane
           Ivan and Tropical Storm Jeanne Programs and lessons documented in
           previous GAO and USAID assessments of disaster recovery programs
           in Latin America, the Caribbean, and Asia.

           To ensure that appropriate internal controls were established to
           account for program funds, we interviewed USAID financial
           management staff in Jamaica and reviewed program documents that
           described USAID's mechanisms for ensuring accountability. We also
           coordinated with USAID's Regional Inspector General to determine
           the Inspector General's involvement with establishing internal
           controls and monitoring how well USAID maintained controls
           throughout the program.

           For this report, we relied primarily on USAID's data reported to
           date in the agency's monthly reports on expenditures and progress
           in each country. We assessed the reliability of this data by (1)
           interviewing USAID program staff and its contractors to determine
           how data were collected and reported and what quality assurance
           mechanisms were in place, (2) reviewing a sample of USAID's
           program files as well as its contractors' files in Grenada and
           Jamaica, and (3) collaborating with USAID's Regional Inspector
           General on the reliability of expenditure data. During our trip to
           Grenada in August 2005, we found errors and a misrepresentation of
           data in USAID's monthly reports, which we reported to USAID staff
           and contractors responsible for the collating the data. USAID
           corrected the data errors and made changes to certain indicators
           that we had found to be misleading. Overall, we found that USAID's
           data as corrected were sufficiently reliable for the purposes of
           addressing our reporting objectives. We conducted our work from
           March 2005 through May 2006 in accordance with generally accepted
           government auditing standards.

           We reviewed USAID's recovery efforts following the 1998 hurricanes
           in Latin America and 2001 earthquakes in El Salvador, as well as
           its ongoing efforts in response to the 2004 tsunami in Asia.
           Following is a compilation of lessons reported by U.S. officials
           and contractors involved in USAID's Hurricane Ivan Recovery and
           Rehabilitation Program and Tropical Storm Jeanne Recovery Program
           as well as lessons from GAO and USAID reviews of previous disaster
           recovery programs. Although this list is by no means exhaustive,
           it summarizes some common lessons and examples of USAID's efforts
           to address disaster recovery challenges and is intended as a tool
           for future disaster recovery programs.

           o  Set appropriate time frames. Disaster recovery program time
           frames should be based on a needs assessment of the activities
           that best aid recovery and should be undertaken in phases, if
           necessary. In our 2002 report on USAID's Hurricane Mitch and
           Georges recovery program, various agency officials said the
           program's time frame influenced how planning, design, and
           implementation of recovery activities affected program
           sustainability. For example, the Dominican Republic mission
           reported that it selected some activities it knew could be
           completed by the expenditure deadline despite recognizing that
           other activities may have achieved greater sustainability,
           especially those with more cost sharing with the host government
           and other implementing organizations. Other agency officials
           involved in the recovery suggested that future efforts include
           time for follow-on activities, such as training, to ensure better
           sustainability. USAID staff and contractors implementing the
           Caribbean programs' activities discussed in this report stated
           that the 1-year time frame influenced the types of activities they
           selected and may have limited the sustainability of some projects.
           One contractor explained that in a previous program, activities
           were divided into different phases (e.g., immediate recovery
           activities were implemented in less than 1 year, while road
           construction was given a 1.5-year time frame and railroad
           reconstruction was planned for 2 years but completed in 3). In the
           Hurricane Ivan Program, USAID was able to identify beneficiaries
           for business and agriculture recovery grants and expend the
           majority of program funds allocated to these activities within a
           1-year time frame, while reconstruction of houses in Jamaica and
           Grenada required an extension several months beyond December 31,
           2005. Based on their experience in the Hurricane Mitch and Georges
           recovery program, USAID officials designing and implementing the
           Tropical Storm Program in Haiti said that program staff should not
           attempt to complete activities in an arbitrarily short time frame.
           USAID staff and contractors we interviewed stated that 15 to 18
           months is a more reasonable time frame for reconstruction
           activities.
           o  Conduct thorough cost assessments. USAID should ensure that
           initial cost estimates are based on specific information about
           site conditions. Due to inadequate estimates in the Caribbean
           programs regarding the cost of labor and materials for
           reconstruction activities, USAID originally targeted an
           unrealistically high number of activities that later had to be
           reduced. Part of this lesson includes anticipating increases in
           construction materials and labor due to increases in demand for
           construction after a disaster. For example, in Indonesia, USAID's
           initial cost estimates for a road to be rebuilt after the tsunami
           were based on limited information about site conditions. Because
           of the uncertainty about the site conditions, the Army Corps of
           Engineers included a 20 percent contingency in its cost estimate.
           However, actual costs may still exceed this estimate because plans
           for the road have changed.

           o  Look beyond restoration of the status quo and aim to improve
           infrastructure and livelihood opportunities. In the planning of
           Hurricanes Mitch and Georges recovery efforts, the U.S. and its
           international partners agreed on an approach that would not simply
           replace what was destroyed, but would "build back better" with a
           lasting impact. This approach was adopted in the Caribbean
           programs. For example, in the rehabilitation of schools, USAID
           repaired schools to their pre-Ivan condition or better in
           compliance with the building codes and hurricane resistance
           standards. In Haiti, USAID also provided household restoration
           grants as well as created a cash-for-work program to help those
           affected by the storm to rebuild their livelihoods and decrease
           their vulnerability to future floods.

           o  Establish a host government agency to coordinate the
           international response to the disaster. USAID worked with the
           governments of Grenada and Jamaica to establish independent
           coordination entities separate from those countries' ministries to
           facilitate the recovery process and streamline working with the
           government. A central agency to coordinate disaster recovery
           between donors is important for ensuring that activities are not
           duplicated; however, USAID and other donors should take into
           account the time needed to establish these agencies when
           developing implementation schedules and setting program completion
           time frames. For example, USAID reported that the Agency for
           Reconstruction in Development in Grenada, funded by USAID and
           other donors, did not take over coordination responsibilities
           until March 2005, about 3 months into USAID's program. In Jamaica,
           USAID coordinated with the Office for National Reconstruction to
           identify recipients for recovery assistance as well as to build
           new housing communities. The Indonesian government established the
           Rehabilitation and Reconstruction Agency to coordinate the
           international response to the tsunami. The entity has produced a
           master plan for reconstruction that it has used to attempt to
           control and track organizations involved in reconstruction.

           o  Channel assistance through organizations and contractors with
           proven track records and a history of working in the affected
           country. USAID officials administering Haiti's Tropical Storm
           Jeanne Recovery Program reported that they selected contractors
           that had a history of working there as a means of strengthening
           coordination and ensuring implementation of program activities.
           This was particularly critical given Haiti's security challenges
           and USAID's inability to travel to many of the project sites
           regularly. In El Salvador, USAID contracted with at least five
           private voluntary organizations that it had previously worked with
           to implement earthquake recovery projects. According to USAID
           officials, using organizations that have proven to be capable and
           reliable reduces the likelihood of misuse of funds and corruption.

           o  Involve community-based organizations in program
           implementation. Noting that this was a successful approach in
           Hurricane Georges, USAID officials in Haiti worked with
           community-based organizations in implementing the Tropical Storm
           Jeanne Recovery Program. For example, one contractor worked with
           local management committees it had worked with during a previous
           program in Gonaives several years before. These groups were one of
           the few functioning civil society organizations in Gonaives
           immediately after the flooding and served as program partners and
           liaisons on community issues, security, and sustainable
           maintenance efforts. Another contractor worked with already
           existing water user groups organized around irrigated parcels in
           the Plaine des Gonaives and Trois Rivieres areas. The use of
           community-based organizations also allowed the contractor to
           mobilize the local population rapidly to execute short-term
           employment generation activities, such as tertiary roads and
           ravine protection structures. In addition, school rehabilitation
           frequently was organized around parent and teacher groups that
           supported the school in preflood periods.

           o  Avoid overlap between host governments and community-based
           organizations to avoid inefficiencies. To avert potential future
           overlap with nongovernmental organizations in Sri Lanka during
           tsunami reconstruction, USAID participated in weekly meetings with
           the government coordinating entity and NGOs, among others, to
           designate responsibility for different geographic areas.

           o  Identify staffing needs quickly and designate someone to manage
           the staffing process. USAID officials involved in Hurricane Mitch
           recovery activities drafted lessons learned recommending that,
           when responding to disaster recovery, USAID mission and Washington
           officials need to quickly identify staffing needs and that an
           appropriate official should be charged with tracking staff issues
           to facilitate the response. For example, in our 2002 report of
           Hurricane Mitch and Georges, we reported that the number of USAID
           direct-hire staff in general, and contracts officers in
           particular, has declined and USAID had difficulty finding
           qualified personnel to manage the large-scale emergency program on
           an expedited basis. In the same report, USAID's Honduran mission
           reported serious constraints due to the absence of a contracts and
           grants officer needed to negotiate and sign agreements and ensure
           that implementation and acquisition mechanisms are in place. The
           mission in the Dominican Republic reported that the majority of
           staff hired for its reconstruction effort had no prior USAID
           experience and that implementation slowed as new staff learned the
           agency's management system. As stated earlier in this report, the
           lack of experienced staff was also a challenge in the Hurricane
           Ivan program.

           o  Create a mechanism to quickly hire staff for recovery and
           reconstruction programs. In addition, a draft document in which
           contractors assessed USAID's Hurricane Mitch program reported that
           lengthy personal service contract hiring practices added to
           staffing bottlenecks, and some USAID staff recommended that waiver
           authorities should be made available to hire staff quickly on a
           noncompetitive basis. In addition, the Honduras Mission stated
           that USAID needs to do a better job of immediately identifying
           staff with the skills needed for reconstruction activities rather
           than relying on staff within the mission or region. In the tsunami
           program, to establish technical oversight, USAID reassigned and
           hired experienced staff, such as engineers, and acquired
           additional technical expertise through interagency agreements but
           had difficulty filling some positions it considered critical to
           technical oversight.

           o  Provide disaster preparedness and mitigation training to
           communities. In Haiti, 222 participants in seven communities were
           trained in disaster preparedness and mitigation, including the
           designation of emergency responders and the development of local
           action plans focused on risk assessment, disaster mitigation, and
           preparedness. In Jamaica, fisherfolk received training in "Safe
           Seamanship and Environmental Management." USAID also developed
           training to ensure sustainability and provide local capacity
           building through a course on "General Safety and Survival at Sea,"
           which was taught to 60 participants from three local NGOs, in
           coordination with the Caribbean Maritime Institute. Participants
           received safety equipment and an emergency response guide
           developed for the fisheries sector, including specific measures to
           reduce vulnerability with regard to small boat safety, search and
           rescue, sinking vessels, fires, bad weather, and survival at sea
           under different distress situations.

           o  Ensure quality control of construction and follow building
           codes appropriate to type of disaster sustained. USAID has
           difficulty ensuring that contractors build houses correctly and
           completely. For example, in our review of the El Salvador
           earthquake program, we reported problems such as roof supports
           that were improperly connected to walls, and metal windows and
           doors that were not functioning properly. Following the GAO visit,
           USAID issued detailed procedures that Army Corps of Engineers
           Officials and contractors were required to complete following
           their work. USAID also conducted additional quality control
           training that contractors, NGOs, and other entities involved in
           implementing the program were required to attend. USAID officials
           stated that the training was useful in reinforcing the principle
           of "building back better" and that, following the training, the
           quality of construction improved. Contractors in the Hurricane
           Ivan program followed local building and hurricane resistance
           codes, including the use of hurricane straps and Caribbean
           Disaster Mitigation Standards for wood and concrete houses.

           o  Understand the local land tenure system. In El Salvador, many
           Salvadorans whose houses were destroyed had no legal proof that
           they owned the property on which their house had stood. Housing
           starts were delayed because contractors had to wait weeks for
           approvals to begin construction. The USAID contractor responsible
           for housing in Grenada also encountered challenges due to land
           title issues. The contractor told us that although it originally
           identified 400 to 500 prospective beneficiaries who met selection
           criteria established by the Grenadian government, many of these
           people lacked the land titles or proof of ownership that USAID
           required of new-housing beneficiaries. Because the process of
           verifying ownership was so time consuming, the contractor
           eventually ran advertisements soliciting respondents who met the
           selection criteria and had proof of land ownership.

           o  Establish memorandums of understanding or formal agreements if
           reconstruction efforts are shared with the host government. In
           Haiti, USAID officials established a memorandum of understanding
           with the government for road and bridge construction activities.
           Conversely, in Jamaica, USAID did not establish a memorandum of
           understanding with the government in its coordination for
           new-housing construction. According to USAID, when the Jamaican
           government did not fulfill its obligation to install electricity
           and septic systems and to provide other infrastructure for the
           housing communities, USAID had to grant extensions to complete
           activities that were impacted by the delays and, as a result,
           delayed the delivery of new housing to beneficiaries.

           o  Address warranties and liabilities for construction projects
           before building. Warranty and liability responsibilities should be
           detailed in the contract agreements and determined prior to
           construction. In the Hurricane Ivan Program, USAID did not
           determine who would fulfill warranty and defects liability
           responsibility early on in the program, and such issues were still
           being resolved, in some cases, after construction of schools and
           other buildings were already completed and the contractor
           considered the project closed.

           o  Coordinate with local industry boards and organizations to
           identify recipients and community leaders. USAID contractors in
           Grenada worked to improve tourism services after Hurricane Ivan
           left 50 percent of the persons previously working in this sector
           unemployed and another 40 percent underemployed. The contractor
           formed partnerships with several local tourism associations,
           including hotel, airport, taxi, and small-business organizations.
           The contractors developed skills training courses to improve
           hospitality and tourist services. For example, after some
           participants were trained in craft making, the contractors
           organized a "Buy Grenada" fair to showcase the participants' work.
           In addition, the contractors partnered with several
           community-based organizations to deliver training in small
           business management, food vending, ecotourism, and professional
           tour guiding.

           o  Coordinate with government for education or skills training.
           USAID's skills training program in Grenada provided needed income
           support and skills development, but was not designed in
           consultation with the government's Ministry of Education.
           Moreover, the government does not recognize the training
           certificates issued to participants. Also, contractors and
           participants recognized that the 6-week training period was not
           long enough to develop certain skills, such as construction, and
           that it would have made more sense to develop fewer, but longer,
           courses to adequately train participants.

           o  Establish accountability mechanisms. Concerns over public and
           private corruption due to the wide dispersion of activities
           following Hurricane Mitch influenced USAID to take extra
           precautions to safeguard program funds. USAID's Regional Inspector
           General (RIG) and GAO monitored the Hurricane Mitch and El
           Salvador earthquake reconstruction programs and briefed USAID
           staff as well as Congress on a regular basis on key issues that
           USAID needed to correct. In the Caribbean program, USAID involved
           RIG officials early in the design to ensure proper accountability
           mechanisms were established and audits were performed early in the
           program.

           o  Hire third-party monitoring firms. USAID officials in Haiti
           contracted with an engineering firm to monitor construction
           activities and with a financial management firm to validate
           performance reports, report on the quality of activities executed
           by the contractor, and identify problem areas, and ensure
           flexibility in implementation. USAID officials reported that the
           oversight and recommendations from the two firms have proven to be
           invaluable. Specifically, the engineering firm was instrumental in
           providing several good recommendations on urgent needs that had
           not been identified in the damage survey; additionally, the firm
           provided early warning on a number of occasions where work needed
           immediate correction and collaborated closely with the
           implementing firms and quickly gained their confidence for sound
           recommendations. It served as a capable arbiter on several
           disputes between implementers and their subcontractors. Both the
           engineering and financial firms served a critical function at a
           time when USAID direct hires were unable to travel freely in Haiti
           to monitor progress due to poor security. In its El Salvador
           earthquake recovery program, USAID required that a private
           accounting firm conduct a concurrent audit of a USAID-funded
           health clinic being implemented by AmeriCares, a U.S.-based
           private voluntary organization that provides medical supplies
           overseas. This was done because AmeriCares had no experience
           implementing a USAID-funded program and was working through a
           Salvadoran nongovernmental organization to carry out the
           construction.

           In Grenada and Jamaica, USAID also contracted engineering
           expertise to monitor the completion and quality of implementing
           contractors' construction activities. The USAID Mission in Jamaica
           obtained these services by augmenting the engineering staff of
           Wingerts Consulting. The work of the engineers engaged through
           Wingerts was similar to that typically performed by a USAID staff
           engineer, including monitoring and reviewing the processes
           utilized by the implementing contractor to assure reasonable
           costs, quality control, and delivery of a final product that is
           consistent with the expected results specified in the contract.
           According to USAID, the Wingerts staff served as an extension of
           the mission, given that the mission needed to move swiftly to
           implement construction and renovation activities and the mission
           did not have internal staff with sufficient expertise to
           effectively implement the activities under a short time frame. The
           engineers engaged by the Jamaica Mission through Wingerts worked
           collaboratively with USAID's technical staff and the implementing
           contractors to provide technical approval of contract award
           processes and certifications and to perform site visits and
           environmental monitoring during execution of construction
           contracts and grants.

           o  Conduct monthly progress reviews and provide interim reports.
           In its April 2005 report, the Regional Inspector General
           recommended that USAID staff responsible for the Hurricane Ivan
           Program monitor the program by maintaining a spreadsheet of target
           due dates for each activity and verify that all activities are
           completed on time. USAID provided monthly reports of its Caribbean
           recovery efforts that summarized the progress of program
           activities, challenges in implementing and completing activities,
           and the programs' expenditures to date. According to USAID
           officials responsible for the Hurricane Ivan Program, the
           contractor hired to assist with oversight, Wingerts Consulting,
           played a role in ensuring regular and timely progress reporting
           and program analysis, including capturing cross-country and
           cross-program implementation issues, and providing program-level
           financial analyses. USAID also reported that Wingerts conducted
           various site visits and served as a liaison between USAID's
           technical staff and implementing contractors to better assess the
           status of activities "on the ground" and report back to the
           mission, the bureau, and other stakeholders. USAID officials
           acknowledged that these reports might have been prepared by
           mission staff rather than Wingerts if USAID had a mission in
           Grenada or had sufficient staff in Jamaica to compile and produce
           the reports.

           David Gootnick, (202) 512-3149 or [email protected]

           In addition to the contact named above, Phillip Herr (Assistant
           Director), Francisco Enriquez, Adrienne Spahr, Reid Lowe, Shana
           Wallace, and Mark Dowling made key contributions to this report.

           Foreign Assistance: USAID Has Begun Tsunami Reconstruction in
           Indonesia and Sri Lanka, but Key Projects May Exceed Initial Cost
           and Schedule Estimates. GAO-06-488 . Washington, D.C.: April 14,
           2006.

           Foreign Assistance: Strategic Workforce Planning Can Help USAID
           Address Current and Future Challenges. GAO-03-946 . Washington,
           D.C., August 22, 2003.

           Foreign Assistance: USAID's Earthquake Recovery Program in El
           Salvador Has Made Progress, but Key Activities Are behind
           Schedule. GAO-03-656 . Washington, D.C.: May 15, 2003.

           Foreign Assistance: Disaster Recovery Program Addressed Intended
           Purposes, but USAID Needs Greater Flexibility to Improve Its
           Response Capability. GAO-02-787 . Washington, D.C.: July 24, 2002.

           Foreign Assistance: AID Strategic Direction and Continued
           Management Improvements Needed. GAO/NSIAD-93-106 . Washington:
           D.C.: June 11, 1993.

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    Various Factors Slowed USAID's Implementation and Completion of Program
                                   Activities

Severe Weather Delayed Program Activities in Jamaica and Haiti

Coordination Challenges Hindered USAID's Implementation and Completion of
Activities in Grenada and Jamaica

Construction-Related Challenges Led to Delays in Grenada, Jamaica, and Haiti

11In responding to a draft of this report in May 2006, USAID commented
that, in response to issues raised by GAO and USAID's RIG, the Jamaica
Mission was in the process of developing a memorandum of understanding for
negotiation and signature with the government of Jamaica's Office of
National Reconstruction.

12According to USAID officials, agency policy does not prohibit
beneficiaries without land titles from receiving recovery assistance;
however, USAID staff managing the Caribbean programs determined that to
avoid land disputes, land titles were necessary for beneficiaries of
new-housing construction.

Security Problems Disrupted Program Activities in Haiti

Lack of Formal Program Guidance, Time Frame, and Staffing Issues Contributed to
                            Implementation Problems

Lack of Guidance That Includes Lessons Learned Contributed to Program Design and
Implementation Challenges

13In addition to administering the $100 million that Congress appropriated
for Caribbean disaster recovery in 2004, USAID administered about $525
million for disaster recovery assistance following Hurricanes Mitch and
Georges in 1999 and $159 million for recovery assistance in El Salvador
following the 2001 earthquakes. USAID's efforts to assist with
reconstruction in Asia following the 2004 tsunami, which are ongoing,
received $908 million in funding.

14USAID, Office of Foreign Disaster Assistance, Bureau for Democracy,
Conflict, and Humanitarian Assistance, Disaster Reduction: A
Practitioner's Guide (Washington, D.C., November 2002).

15 GAO-02-787 .

16USAID, Lessons Learned from Planning and Implementation of the Hurricane
Mitch Supplemental Reconstruction Program (draft report) (Washington,
D.C., June 27, 2000).

USAID Applied Some Lessons from Previous Disaster Programs but Did Not Follow
Prior Recommendations on Time Frame and Staffing

  USAID Applied Some Lessons Learned from Previous Programs

  One-Year Time Frame May Have Limited Impact and Sustainability of Some
  Activities and Conflicted with Prior Lessons Learned

17OMB staff indicated that they encourage USAID to consult with OMB on any
difficulties the 1-year time frame may have posed on program
implementation, but USAID did not seek additional consultation.

18This was partially owing to limited employment opportunities for women
who took construction courses but had difficulty obtaining jobs in this
field.

19USAID had agreed to expend all of the appropriated funds by December 31,
2001, about 30 months from enactment of the supplemental appropriation.
See GAO-02-787 .

  USAID Did Not Implement Some Prior Staffing Recommendations and Encountered
  Challenges Related to Use of Management Firm

20 GAO-02-787 .

21 GAO-02-787 .

22Lessons Learned from Planning and Implementation of the Hurricane Mitch
Supplemental Reconstruction Program.

23GAO, Foreign Assistance: USAID Has Begun Tsunami Reconstruction in
Indonesia and Sri Lanka, but Key Projects May Exceed Initial Cost and
Schedule Estimates, GAO-06-488 (Washington, D.C.: Apr. 14, 2006).

24USAID, Office of the Inspector General, Audit of USAID/Jamaica's
Hurricane Recovery and Rehabilitation Activities, Audit Report No.
1-532-05-008-P (San Salvador, El Salvador, April 2005).

USAID Staff and Contractors Are Recording Lessons Learned

25USAID, Office of the Inspector General, Audit of USAID/Jamaica's
Hurricane Recovery and Rehabilitation Activities, Audit Report No.
1-532-06-004-P (San Salvador, El Salvador, April 2006).

                                  Conclusions

                      Recommendations for Executive Action

                       Agency Comments and Our Evaluation

Appendix I: Objectives, Scope, and Methodology Appendix I: Objectives,
Scope, and Methodology

1GAO did not visit the Caribbean islands of Bahamas, Tobago, and Caribbean
Community islands, which received a total of $2 million for small-scale
hurricane recovery efforts.

Country Type of activity at project site     Number          
Grenada Community rehabilitation             8 recipients    
                                                                
           Housing repairs                      11a recipients  
                                                                
           New housing construction             2 projects      
                                                                
           Community centers                    1 project       
                                                
           Water and sanitation                 
           School repairs                       10 schools      
           Business recovery                    4 recipients    
                                                                
           Agriculture grants                   2 recipients    
                                                                
           Fishery grants                       5 recipients    
                                                                
           Small to medium-size business grants 4 centers       
                                                
           Skills training                      
Jamaica Community rehabilitation             10b recipients  
                                                                
           Housing repairs                      2 sites with total of 186
                                                houses          
           New housing construction             
           School repairs                       7 schools       
           Business recovery                    10c recipients  
                                                                
           Agriculture grants                   1 community     
                                                                
           Fishery grants                       3 recipients    
                                                
           Craft grants                         
Haiti   Community revitalizationd            1 school        
                                                                
           School repairs                       1 community     
                                                                
           Disaster preparedness training       5 recipients    
                                                                
           Asset restoration grants             1 project       
                                                                
           River-widening project               1 project       
                                                
           Canal cleanup                        
Total                                        89              

Afrom USAID Disaster RecoRec Appendix II: Summary of Lessons Learned from
USAID Disaster Recovery and Reconstruction Efforts

Lessons Learned for Program Planning and Implementation

Lessons Learned for Staffing

essons Learned for Recovery Activities

  L

  Disaster Preparedness and Mitigation

  Construction

  Nonconstruction

Lessons Learned for Ensuring Accountability

Lessons Learned for Monitoring and Evaluation

Appendix III: Comments from the U.S. Agency for International Develop
Appendix III: Comments from the U.S. Agency for International Development

Appendix IV: A Appendix IV: GAO Contact and Staff Acknowledgments

                                  GAO Contact

                             Staff Acknowledgments

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May 2006

FOREIGN ASSISTANCE

USAID Completed Many Caribbean Disaster Recovery Activities, but Several
Challenges Hampered Efforts

As of December 31, 2005, USAID had spent about 77 percent of funds
allocated for assistance in Grenada, Jamaica, and Haiti and completed many
disaster recovery activities, such as providing business and agriculture
grants. However, the agency significantly reduced its targets for building
and repairing houses, in part because of cost increases, and granted
contractors extensions to complete some of these projects.

Severe weather delayed the progress of recovery activities in Jamaica and
Haiti-for example, two hurricanes in the summer of 2005 disrupted Jamaican
housing repairs. In addition, difficulty coordinating activities with the
Grenadian and Jamaican governments hampered housing construction. Further,
other construction-related challenges-for example, shortages of
cement-delayed projects in Grenada and Jamaica. Finally, frequent security
problems in Haiti hindered contractors' progress.

USAID has not issued guidance that incorporates lessons learned from
previous recovery and reconstruction programs, such as ways to mitigate
challenges commonly faced in rebuilding after disasters. USAID staff
inexperienced with disaster recovery efforts said that this made it
difficult to design and implement the programs. Further, in agreeing to
complete the programs within 1 year, USAID faced challenges in designing a
broad spectrum of activities that would help rebuild residents' lives and
that could be sustained after the programs ended. In addition, the agency
did not adopt recommendations from GAO and USAID reviews of past recovery
programs that could have helped it more rapidly hire and transfer staff
for the Caribbean programs. Although the agency contracted with a
management firm to quickly staff its program in Grenada and Jamaica, this
led to additional challenges, such as confusion about the management
firm's roles and responsibilities in relation to USAID staff and other
contractors. USAID staff and contractors are recording lessons learned
from the programs in each country.

New Housing Construction in Jamaica (left) and Grenada

In September 2004, Hurricane Ivan and Tropical Storm Jeanne passed through
the Caribbean, taking lives and causing widespread damage in several
countries. After initial U.S. emergency relief, in October 2004 Congress
appropriated $100 million in supplemental funding, primarily for Grenada,
Jamaica, and Haiti, which were significantly affected. The U.S. Agency for
International Development (USAID), leader of the U.S. recovery programs,
agreed, in consultation with the Office of Management and Budget, to
complete the programs by December 31, 2005, giving the agency a 1-year
time frame. GAO was asked to (1) review the nature and status of the
programs in Grenada, Jamaica, and Haiti as of December 31, 2005; (2)
identify factors that affected the programs' progress; and (3) assess
USAID's use of guidance and lessons learned from previous similar programs
and efforts to draw lessons from the current programs.

What GAO Recommends

GAO recommends that the USAID Administrator (1) develop disaster recovery
and reconstruction guidance that incorporates lessons learned from the
current and previous programs and (2) revise staffing procedures to
facilitate the rapid reassignment or hiring of needed personnel for
postdisaster recovery and reconstruction programs. USAID agreed with our
recommendations.
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