Homeland Security Assistance for Nonprofits: Department of
Homeland Security Delegated Selection of Nonprofits to Selected
States and States Used a Variety of Approaches to Determine
Awards (22-MAY-06, GAO-06-663R).
The fiscal year 2005 Department of Homeland Security (DHS)
appropriation set aside $25 million, of the $885 million
appropriated for the Urban Areas Security Initiative (UASI), for
grants to eligible nonprofit organizations that the Secretary of
Homeland Security determined to be at high risk of international
terrorist attack. This letter responds to the conference report
that directed GAO to review the validity of the threat and risk
factors used by DHS to allocate discretionary grants to nonprofit
organizations in fiscal years 2003, 2004, and 2005. Based on our
review of DHS's risk methodology for fiscal year 2006, the
criteria in the fiscal year 2005 grant application kit, and
conversations with Congressional staff about the conference
report, we addressed the following objectives: (1) DHS's
methodology for determining risk for urban areas and the
nonprofit grant program, and DHS implementation of the program;
(2) states' efforts to implement the nonprofit grant program in
fiscal year 2005, and (3) whether subgrants were made to
nonprofits in fiscal years 2003 and 2004, when funds were not
specifically set aside for nonprofits.
-------------------------Indexing Terms-------------------------
REPORTNUM: GAO-06-663R
ACCNO: A54599
TITLE: Homeland Security Assistance for Nonprofits: Department
of Homeland Security Delegated Selection of Nonprofits to
Selected States and States Used a Variety of Approaches to
Determine Awards
DATE: 05/22/2006
SUBJECT: Appropriated funds
Federal grants
Nonprofit organizations
Risk assessment
Security threats
Set-asides
Allocation (Government accounting)
Program management
Urban areas
Program implementation
DHS Urban Area Security Initiative
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GAO-06-663R
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United States Government Accountability Office Washington, DC 20548
May 22, 2006
The Honorable Judd Gregg Chairman The Honorable Robert C. Byrd Ranking
Member Subcommittee on Homeland Security Committee on Appropriations
United States Senate
The Honorable Harold Rogers Chairman The Honorable Martin Olav Sabo
Ranking Member Subcommittee on Homeland Security Committee on
Appropriations House of Representatives
Subject: Homeland Security Assistance for Nonprofits: Department of
Homeland Security Delegated Selection of Nonprofits to Selected States and
States Used a Variety of Approaches to Determine Awards
The fiscal year 2005 Department of Homeland Security (DHS) appropriation1
set aside $25 million, of the $885 million appropriated for the Urban
Areas Security Initiative (UASI), for grants to eligible nonprofit
organizations that the Secretary of Homeland Security determined to be at
high risk of international terrorist attack.2 This letter responds to the
conference report that directed GAO to review the validity of the threat
and risk factors used by DHS to allocate discretionary grants to nonprofit
organizations in fiscal years 2003, 2004, and 2005.3 Based on our review
of DHS's risk methodology for fiscal year 2006, the criteria in the fiscal
year 2005 grant application kit, and conversations with your staff about
the conference report, we addressed the following objectives: (1) DHS's
methodology for determining risk for urban areas and the nonprofit grant
program, and DHS implementation of the program; (2) states' efforts to
implement the nonprofit grant program in fiscal year 2005, and (3) whether
subgrants were made to nonprofits in fiscal years 2003 and 2004, when
funds were not specifically set aside for
1
Pub. L. No. 108-334, 118 Stat. 1289, 1309 (2004).
2
Nonprofits are those organizations described by 26 U.S.C. S:501(c)(3).
3
H.R. Conf. Rep. No. 109-241, at 65 (2005).
nonprofits. On May 3, 2006, and May 8, 2006, we briefed your offices on
the results of our review. This letter, and the accompanying slides,
transmits information provided during those briefings.
Summary
To implement the fiscal year 2005 nonprofit grant program, DHS used a
two-tiered approach, first determining the urban areas in which nonprofits
would be eligible to apply for the funds and then providing guidance to
the states on how to allocate the funds to applicants. In the first stage,
DHS determined that in the absence of information from federal law
enforcement about risk to specific nonprofit organizations, those
nonprofits that were located in the highest risk urban areas were most at
risk of international terrorist attack. DHS used a model based on five
factors to determine the urban areas that would receive fiscal year 2005
UASI grants and the grant amount for each area. Using this model, fifty
urban areas were determined to be at high risk. Of those 50, the top
18-located in 13 states and the District of Columbia4-were selected to
receive portions of the $25 million set aside for nonprofit organizations
(nonprofits in urban areas that did not receive a nonprofit allocation
could still apply for subgrants from the State Homeland Security and UASI
grant programs). The amounts allocated were based upon each area's
contribution to the overall risk in the 18 areas. In the second stage of
the process, DHS delegated to the states the authority to make subgrants
to organizations, but required them to use six risk criteria provided by
DHS to determine organizations at high risk of international terrorist
attack. According to DHS, it made this delegation because it had no
information about credible threats against nonprofits by international
terrorist organizations, and it believed that state and local law
enforcement might have credible information and that states and urban
areas might be in a better position to assess threats within their areas.
DHS then provided programmatic guidance to the states along with the six
risk criteria that states were to consider in determining eligibility and
selecting nonprofits for subgrants. These criteria addressed the three
elements of risk--threat, vulnerability, and consequences. The criteria
did not require actual threats against facilities within the United
States. Individual awards were not to exceed $100,000 and were for target
hardening only. DHS retained responsibility for managing the grant program
and for monitoring the awards it made to the states with the nonprofit
funding.
The 13 states and the District of Columbia implemented the program using
differing approaches. They interpreted the DHS guidance as providing
flexibility in implementing the program. They used several approaches in
working with their urban areas and required nonprofit applicants to
provide varying amounts of risk-related information and organizational
capacity information. The threat information provided by the nonprofit
applicants varied in specificity and the degree to which it referred to
threats from international terrorist groups; none provided reports of
threats
The District of Columbia received funding for the National Capital Region
(NCR). The District of Columbia, the counties of Montgomery and Prince
George's, Md.; the counties of Arlington, Fairfax, Prince William, and
Loudon, Va.; the cities of Falls Church, Manassas, Manassas Park, Fairfax,
and Alexandria, Va., comprise the NCR.
Page 2 GAO-06-663R Homeland Security Assistance for Nonprofits
or attacks by international terrorist organizations against the specific
facilities of the nonprofit applicants that were located within the United
States. The vulnerability information included some professional
assessments. Some applicants claimed proximity to critical infrastructure;
others cited the presence of particular individuals as indications of
vulnerability. Information on potential consequences generally related to
the size of the organization and included number of employees or persons
served as indicators of potential consequences. The states and urban areas
generally relied on law enforcement to assess threat and vulnerability.
Some of the states and urban areas developed formal methods for assessing
the nonprofit organizations' risk and capacity to implement the proposed
projects. About 400 awards were made, out of 600 applications. Most
recipients were religious organizations. Medical and social services were
the second and third largest categories. The average amount awarded was
about $62,000. State and urban area officials reported a range of views
about target hardening for nonprofit organizations. For example, some
stated that the subgrants met a need, but that nonprofits, relative to
other critical infrastructure, were a comparatively low priority for
funding, and most said they had not received inquiries from nonprofits
about the availability of funding for target hardening prior to the fiscal
year 2005 allocation. Others said that the $100,000 limit on target
hardening subgrants was insufficient to address need. Some officials also
noted that target hardening funds were already allowable under the State
Homeland Security and UASI grant programs and that a specific allocation
for nonprofits constrained their ability to address the security issues of
other types of organizations. Finally, officials reported that they
generally lacked the capacity to conduct the type of vulnerability
assessments needed to determine the relative risk to nonprofit
organizations within their areas and that in implementing the nonprofit
grant program, they needed additional guidance and support from DHS;
implementing the program added additional unreimbursable administrative
costs; and they varied in the degree to which they could determine that
the program reduced the overall risk of terrorist attack to their area.
About 18 UASI subgrants were made to nonprofits in fiscal years 2003 and
2004. No funding was set aside specifically for nonprofits in the DHS
appropriations for those years. Nonprofits were eligible for subgrants,
but many states were unaware that they could make subgrants to nonprofits.
The subgrants that were made to nonprofits were generally for citizen
preparedness and capability enhancement for emergency response
organizations. None were for target hardening.
Scope and Methodology
To review the DHS methodology for determining risk for urban areas and the
nonprofit grant program and the decision to delegate the selection of
nonprofit subgrantees to the states, we interviewed officials and reviewed
documentation from DHS. To address the remaining objectives, we
interviewed officials from the 18 urban areas that received fiscal year
2005 nonprofit allocations; reviewed solicitations for applications;
reviewed copies of applications, where available; interviewed officials
from 17 additional urban areas that did not receive fiscal year 2005
nonprofit allocations; and reviewed DHS data and documentation. We
assessed the reliability of the data and determined that it was sufficient
for our purposes.
We conducted our work in accordance with generally accepted government
auditing standards from February 2006 through April 2006.
We provided the Department of Homeland Security with a draft of this
report. It provided technical comments that have been incorporated into
this report.
As agreed with your office, we will send copies of this report to relevant
congressional committees and subcommittees and to the Secretary of the
Department of Homeland Security. Copies of this report will also be made
available to others upon request. In addition, this report will be
available on GAO's Web site at http://www.gao.gov.
If you or your staff have questions regarding this report, please contact
me at (202) 512-8757 or by e-mail at [email protected] or William Sabol at
(202) 512-3464 or by e-mail at [email protected]. Key contributors to this
report were David Alexander, Frances Cook, Kathryn Godfrey, Daniel
Kaneshiro, Doris Page, and Nettie Richards.
William O. Jenkins Jr. Director, Homeland Security and Justice Issues
Enclosure-2
Enclosure I: Fiscal Year 2005 UASI Nonprofit Allocations, Number of
Applications and Nonprofit Grants Awarded
Nonprofit organizations applying, Amount of
awarded, and not funded nonprofit
Amount allocation
allocated to Number of not
awarded
nonprofit organizations Number Number Number of as of
March
State Urban area organizations applying funded not solicitations 31, 2006
funded
California Anaheim $114,490 0 0 0 2 $114,490
San 935,551 7 6 1 2 394,141
Francisco
Los Angeles 3,750,000 88 46 42 1 0
San Diego 320,885 8 6 2 1 0
District of National 4,500,000 38 37 1 2 c 1,706,527
Columbia Capital
Region
Florida Miami 402,110 28 18 10 1 0
Georgia Atlanta 216,068 15a 15 0 NA 0
Illinois Chicago 3,000,000 41 38 3 2 73,000
Maryland Baltimore 132,160 45 38b 7 1 0
Massachusetts Boston 2,075,000 43 25 18 1 0
Michigan Detroit 516,028 6 6 0 1 0
New Jersey Newark 181,298 8a 7 1 NA 0
New York New York 6,311,701 203 113b 90 1 0
City
Oregon Portland 100,000 4 2 2 1 0
Pennsylvania Philadelphia 1,347,598 76 29 47 1 0
Texas Dallas 261,148 5 2 3 1 0
Houston 681,984 13 13 0 1 0
Washington Seattle 153,978 7 3 4 1 0
Total $24,999,999 635 404 231 $2,288,158
Source: GAO analysis of DHS data and interviews with state and urban area
officials.
a
UASI regions selected applicants and awardees rather than issuing
solicitations.
b
Additional DHS funds were used to supplement the initial UASI nonprofit
allocation to enable funding this number of applicants. cAwards for the
second solicitation had not been made at the time of our review.
Enclosure II: Presentation
(440478)
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