Hurricane Katrina: Improving Federal Contracting Practices in	 
Disaster Recovery Operations (04-MAY-06, GAO-06-714T).		 
                                                                 
The devastation experienced throughout the Gulf Coast region in  
the wake of Hurricanes Katrina and Rita has called into question 
the government's ability to effectively respond to such 	 
disasters. The government needs to understand what went right and
what went wrong, and to apply these lessons to strengthen its	 
disaster response and recovery operations. The federal government
relies on partnerships across the public and private sectors to  
achieve critical results in preparing for and responding to	 
natural disasters, with an increasing reliance on contractors to 
carry out specific aspects of its missions. This testimony	 
discusses how three agencies--the General Services		 
Administration, the Federal Emergency Management Agency (FEMA),  
and the U.S. Army Corps of Engineers (the Corps)--conducted	 
oversight of 13 key contracts awarded to 12 contractors for	 
hurricane response, as well as public and private sector	 
practices GAO identified that provide examples of how the federal
government could better manage its disaster-related procurements.
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-714T					        
    ACCNO:   A53339						        
  TITLE:     Hurricane Katrina: Improving Federal Contracting	      
Practices in Disaster Recovery Operations			 
     DATE:   05/04/2006 
  SUBJECT:   Contract administration				 
	     Contract oversight 				 
	     Disaster planning					 
	     Disaster recovery					 
	     Disaster recovery plans				 
	     Emergency management				 
	     Emergency preparedness				 
	     Federal procurement				 
	     Federal procurement policy 			 
	     Hurricane Katrina					 
	     Hurricane Rita					 
	     Hurricanes 					 
	     Interagency relations				 
	     Natural disasters					 
	     Private sector practices				 
	     Procurement planning				 
	     Procurement practices				 
	     Labor force					 
	     Personnel management				 
	     Lessons learned					 
	     Best practices					 
	     Best practices methodology 			 

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GAO-06-714T

     

     * Summary
     * Contractor Roles in Emergency Response Operations Are Increa
     * There Was Inadequate Planning and Preparation in Anticipatin
          * Examples of Federal, State, and Private Sector Practices for
     * There Was a Lack of Clearly Communicated Responsibilities ac
          * Examples of State and Private Sector Practices for Establish
     * There Were Insufficient Numbers and Inadequate Deployment of
          * Examples of Federal and Private Sector Practices for Improvi
     * 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

Testimony

Before the Committee on Government Reform,House of Representatives

United States Government Accountability Office

GAO

For Release on Delivery Expected at 10:00 a.m. EDT

Thursday, May 4, 2006

HURRICANE KATRINA

Improving Federal Contracting Practices in Disaster Recovery Operations

Statement of William T. Woods, Director Acquisition and Sourcing
Management

GAO-06-714T

Mr. Chairman and Members of the Committee:

Thank you for inviting me here today to discuss the practices for managing
federal disaster recovery contracts related to Hurricanes Katrina and Rita
and how these practices can be improved. The size and strength of
Hurricane Katrina resulted in one of the largest natural disasters in our
nation's history, and in its aftermath major questions have been raised
about our nation's readiness and ability to respond to catastrophic
disasters. Hurricane Rita increased demands on an already stressed
response and recovery effort at all levels of government.

GAO has a large body of ongoing work on a range of issues relating to all
phases of the preparation, response, recovery, and rebuilding efforts
related to Hurricanes Katrina and Rita. GAO's work has been coordinated
with the rest of the accountability community at the federal, state, and
local levels to ensure that all significant issues associated with relief
and recovery, including contracting, are addressed while avoiding
unnecessary duplication of efforts.

Comptroller General Walker recently testified on GAO's preliminary
observations on the challenges encountered in the response to Hurricane
Katrina, and he identified four themes that are similar to lessons learned
from past catastrophic disasters.1 These include the central importance of
(1) clearly defining and communicating leadership roles, responsibilities,
and lines of authority for response in advance of a catastrophic disaster;
(2) clarifying the procedures for activating the National Response Plan
and applying them to emerging catastrophic disasters; (3) conducting
strong advance planning and robust training and exercise programs; and (4)
strengthening response and recovery capabilities for a catastrophic
disaster.

These themes directly relate to what I will discuss today, namely how
three agencies planned for and conducted oversight of several key
contracts in support of Katrina and Rita response and recovery efforts:
the General Services Administration (GSA), the Federal Emergency
Management Agency (FEMA), and the U.S. Army Corps of Engineers (the
Corps). 2 For those areas where we identified deficiencies, I will also
discuss public and private sector practices that provide examples of how
the federal government could better manage its disaster-related
procurements. In doing our review, we selected 13 mission-critical
contracts, each with a dollar value in excess of $5 million, that were
awarded to 12 contractors performing work for the three agencies. We
analyzed how monitoring policies and processes were put into practice. We
also reviewed the practices of selected federal agencies, state emergency
management agencies, commercial businesses, and a major utility that
responded to Hurricane Katrina, analyzing their policies and procedures to
identify successful practices and alternative approaches for managing
disaster-related procurements. We conducted our work from October 2005
through March 2006 in accordance with generally accepted government
auditing standards.

1  GAO, Hurricane Katrina: GAO's Preliminary Observations Regarding
Preparedness, Response, and Recovery, GAO-06-442T , (Washington D.C.: Mar.
8, 2006).

2 See GAO, Agency Management of Contractors Responding to Hurricanes
Katrina and Rita, GAO-06-461R (Washington, D.C.: March 2006).

                                    Summary

Given the environment in which they were operating, agency acquisition and
contractor personnel have been recognized for their hard work in providing
the goods and services required to be responsive. The response efforts
nonetheless suffered from three primary deficiencies:

           o  inadequate planning and preparation in anticipating
           requirements for needed goods and services,
           o  lack of clearly communicated responsibilities across agencies
           and jurisdictions to ensure effective acquisition outcomes, and
           o  insufficient numbers and inadequate deployment of personnel to
           provide for effective contractor oversight.

           A number of efforts are under way by these agencies to address the
           issues we and others have identified.

           In reviewing contracts awarded in another contingency situation,
           rebuilding Iraq, GAO found that without effective acquisition
           planning, management processes, and sufficient numbers of capable
           people, poor acquisition outcomes resulted. GAO made
           recommendations for improving procurements in contingency
           operations, including the need for sufficient numbers of trained
           staff who have clear responsibilities and guidance for overseeing
           contractor performance. In more recent work, we identified a
           number of practices in the public and private sectors that provide
           insight into how the federal government can better manage its
           disaster-related procurements. These practices include

           o  developing knowledge of contractor capabilities and prices by
           identifying available commodities and services and establishing
           vendor relationships before they are needed,
           o  establishing a scalable operations plan to adjust the level of
           capacity required to effectively respond to the need,
           o  formally assigning and communicating disaster-related
           responsibilities, with joint training for government and
           contractor personnel, and
           o  providing sufficient numbers of field-level contracting staff
           with the authority needed to meet mission requirements.

           The private sector is an important partner with the government in
           responding to and recovering from natural disasters such as
           Hurricanes Katrina and Rita. As we recently noted,3 such
           partnerships increasingly underlie critical government operations.
           With hundreds of billions of tax dollars spent each year on goods
           and services, it is essential that federal agency acquisitions be
           handled in an efficient, effective, and accountable manner.

           Over $87 billion of federal funding has been appropriated in
           response to the recent hurricanes. In responding to Hurricanes
           Katrina and Rita, the government depended heavily on contractors
           to deliver ice, water, and food supplies; patch rooftops; and
           provide housing to displaced residents and temporary facilities to
           local government agencies. Overall, the circumstances caused by
           the hurricanes created a difficult environment in which agencies
           had to balance the need to deliver goods and services quickly with
           the need for appropriate controls. Although achieving that balance
           is sometimes hard to accomplish, that fact must not be allowed to
           serve as an excuse for poor contracting practices.

           The need for strong planning is one of the themes identified by
           the Comptroller General in regard to the government's overall
           response to the hurricanes. Planning also must explicitly address
           the need for and management of the contractor community. In
           previous work we said that for federal agencies to be effective
           they need to develop the knowledge necessary to identify, select,
           and manage contractors, including having competitively awarded
           contracts in place prior to a disaster. We found that some key
           agencies did not always have adequate plans for contracting in a
           major contingency situation. We also noted the competing tensions
           between the selection of national contractors and the requirement
           under the Stafford Act for a preference for contractors from the
           affected area. Better planning could have alleviated those
           tensions.

           For example:

           o  While contracts for some items were in place prior to the
           storm, FEMA did not adequately anticipate needs for such services
           as providing temporary housing and public buildings.

           o  The practice of the Corps is to establish Planning and Response
           Teams for various missions assigned to it by FEMA prior to an
           event, with specific responsibilities assigned to team members.
           However, the Corps indicated it did not know prior to the
           hurricane that it would be tasked by FEMA with some of the mission
           assignments it received. In one case, faced with a compressed time
           frame for acquiring portable classrooms and with no prior
           knowledge about the classroom mission they were assigned, Corps
           contracting officials placed an order, under an existing
           agreement, with a subsidiary of an Alaska Native Corporation under
           the Small Business Administration's section 8(a) Business
           Development Program. The Corps accepted the contractor's proposed
           price of $39.5 million even though it had information that the
           cost for the classrooms was significantly less than that. Based on
           our analysis of a quote obtained by the contractor from a local
           Mississippi business, the price the contractor actually paid for
           the classrooms, and prices for similar units from GSA schedule
           contracts, our conclusion4 is that the Corps could have, but
           failed to, negotiate a lower price.

           o  Similarly, better management of requirements development could
           have avoided costs to house workers and victims. Based on
           information provided by local officials, FEMA spent $3 million for
           4,000 base camp beds that were never used.

           o  Preparation was also lacking in implementation of the Stafford
           Act preference for contractors residing or doing business in the
           affected area.5 The Corps staff expressed uncertainty regarding
           how to apply preferences or determine if a company was in an
           affected area.6 Several GSA and FEMA officials indicated they were
           aware of the Stafford Act, but stated it is difficult to
           immediately factor in local businesses in such a catastrophic
           event. GSA officials stated they plan to review the Federal
           Acquisition Regulation (FAR) to see if additional Stafford Act
           guidance is necessary.7

           In discussing our findings and observations with FEMA officials,
           they said they are taking steps to improve in areas such as
           staffing and premobilization capabilities. However, they also
           stated that such pre-planning and preparedness has a cost. The
           Corps commented that contracting staff need to have defined
           requirements in order to get the right type of contracts put in
           place, and the contracting staff did not always get defined
           requirements in a timely manner. Additionally, a Corps official
           commented that until funding for a particular mission is secured,
           preparation for it cannot go forward and this also delayed
           contracting efforts. Finally, both GSA and the Corps noted that
           they tried to reach out to local and small businesses through
           forums and other means to make them aware of opportunities to
           contract with the federal government.

           Officials that we talked to in the public and private sectors
           considered pre-identification of commodities, scalable operations,
           and pre-established vendor relationships to be essential for
           ensuring adequate planning and preparation for providing needed
           goods and services following a disaster. For example:

           o  Florida's Division of Emergency Management developed a database
           that pre-identifies over 200 supplies and services that may be
           needed to respond to a disaster. Florida also pre-qualifies
           vendors, recording quantities and locations of vendor supplies,
           and establishes rates before each hurricane season, giving it the
           knowledge it needs to quickly procure supplies and services at a
           reasonable price. Similarly, Wal-Mart uses a database to review
           historical buying trends to identify what goods will be in demand
           both before and after a hurricane, and to stock the merchandise in
           its stores accordingly.

           o  The Corps awards Advanced Contracting Initiative (ACI)
           contracts to fulfill its anticipated disaster response missions.
           ACI contracts are used to jump start the missions following a
           disaster, with the Corps bringing in other contracts as necessary
           to complete the work.

           o  Part of Mississippi Power's operations plan is to identify
           multiple potential staging areas, and multiple housing and food
           supply options for its own and outside workers, which enables the
           company to expand or reduce its operations depending on the size
           of the disaster. After Hurricane Katrina, Mississippi Power's
           scalable operations plan enabled it to shelter and manage more
           than twice the number of outside personnel it had planned for, but
           that were needed to restore service as quickly as possible to all
           customers able to receive power.

           We also found that processes for executing contracts were hindered
           by poor communication of responsibilities. As envisioned under the
           National Response Plan (NRP), federal agencies responding to a
           disaster carry out their acquisition functions through a network
           of federal, state, and local agencies. In some instances, the
           local or state officials determine the requirements and
           communicate them to FEMA; FEMA may write and award the contract or
           communicate the requirements to another agency that writes and
           awards the contract; and then FEMA or another agency oversees
           contract performance. This approach puts a premium on aligning
           roles and responsibilities clearly and maintaining good
           communications to ensure effective execution of the contract.

           Our fieldwork identified examples where unclear responsibilities
           and poor communications resulted in poor acquisition outcomes. For
           example:

           o  FEMA officials stated that a contractor spent approximately $10
           million to renovate 160 rooms and furnish another 80 rooms in
           military barracks in Alabama that a FEMA survey team identified
           for use as temporary housing. To renovate the facility, FEMA
           headquarters awarded a contract without consulting local FEMA
           officials in Alabama. According to FEMA officials in Alabama,
           however, the facility was not needed and they tried to stop the
           renovation. These same FEMA officials stated that few evacuees
           agreed to live at the facility, and when officials decided to
           close the facility, it had only six occupants.

           o  The process for ordering and delivering ice heavily depends on
           effective communications between FEMA and the Corps. However,
           according to Corps officials, FEMA did not fully understand the
           contracting approach used by the Corps and ordered at least double
           the amount of ice required, resulting in an oversupply of ice and
           a lack of distribution sites available to handle the volume
           ordered. Additionally, the local Corps personnel were not always
           aware of where ice might be delivered and did not have the
           authority to redirect ice as shipments arrived, resulting in
           inefficient distribution and receipt at the state level.

           o  FEMA tasked GSA to write three contracts in Louisiana for base
           camps, hotel rooms, and ambulances, with a total value of over
           $120 million. GSA contracting officers awarded the contracts, but
           could not tell us which FEMA officials would be responsible for
           overseeing contractor performance. The FEMA official identified as
           the main point of contact by GSA did not have any knowledge of
           these contracts or who was responsible for oversight. Only after
           contacting multiple FEMA officials over a 3-week period were we
           able to determine the agency officials responsible for contract
           oversight.

           In commenting on our findings, GSA officials stated that their
           role is to provide resource support in the response phase of a
           disaster, meaning they are responsible for executing contracts
           under the NRP, and FEMA is responsible for monitoring the
           contracts. FEMA officials commented that there needs to be more
           clarity regarding procurement roles and indicated one of their
           goals is to work with GSA to clarify procurement responsibilities
           for the future. GSA officials indicated that the current
           memorandum of understanding between GSA and FEMA is being updated
           to reflect the standards of the new NRP as well.

           To clearly establish and communicate disaster-related
           responsibilities, public and private sector officials told us they
           use such practices as conducting joint disaster response training
           for agency employees and contractors and formally assigning their
           employees specific disaster-related responsibilities. For example:

           o  The employees at CSX Transportation Railroad and their
           suppliers participate jointly in both disaster planning and
           training exercises. This allows each supplier to know its
           responsibilities and the railroad's expectations in the event of a
           natural disaster. As a part of its preparation for disaster
           response, the Florida Division of Emergency Management holds joint
           state-wide training exercises every year with suppliers.

           o  Management-level personnel at Mississippi Power are assigned
           disaster director roles aligned to their day-to-day functions,
           which they assume during the company's storm preparation phase.
           Each disaster director has a designated backup and directs all
           disaster-related activities within his or her functional areas.
           Each functional area has a specific disaster plan that is integral
           to the overall corporate disaster recovery plan. Each Mississippi
           Power employee also has a storm assignment and receives annual
           training on that assignment.

           The purpose of agencies' monitoring processes is to ensure that
           contracted goods and services are delivered in accordance with the
           agreed-upon schedule, cost, quality, and quantity provisions
           stated in the contract. Without sufficient numbers of trained
           people properly deployed, however, effective monitoring is
           hampered and agencies may not be able to identify and correct poor
           contractor performance in a timely manner. Furthermore, agencies
           can be at risk of paying contractors more than the value of the
           services performed.

           Our work indicated that while monitoring was occurring on the
           contracts we reviewed, the number of monitoring staff available
           was not always sufficient, and staff were not always effectively
           deployed. For example:

           o  FEMA's contracts for installing temporary housing in four
           states had only 17 of the 27 technical monitors that had been
           determined necessary to oversee contractor performance.8

           o  Corps officials responsible for overseeing the "blue roof"
           program's field operations told us it was slowed down due to the
           lack of sufficient monitors.9

           Deployment practices did not always provide for appropriate
           notification of responsibilities or overlap of rotating
           contracting officers and oversight personnel, thus making
           knowledge transfer and continuity of contract management
           operations difficult. For example:

           o  For four of the contracts we reviewed, officials were either
           unaware or not notified by FEMA of their oversight
           responsibilities.

           o  The lack of overlap between oversight personnel for a large
           temporary housing contract left the most recent contract
           administrator with no knowledge or documentation of who had
           authorized the contractor to perform certain activities or why the
           activities were being performed.

           While discussing our findings and observations with FEMA
           officials, they emphasized that they lacked adequate staffing, but
           said they have made efforts to fill staffing gaps. Additionally,
           FEMA officials stated they recognize the need for continuity in
           contract oversight and indicated they are implementing a process
           to ensure workload and knowledge sharing among rotating personnel.
           However, they also believe that fewer transition difficulties
           exist now as a result of hiring more people and having more
           oversight officials staying in the affected areas. GSA officials
           indicated there may also be other alternatives for ensuring
           adequate contract oversight, such as designating GSA employees to
           conduct oversight on some contracts. Corps officials stated their
           policy is to rotate certain personnel every 29 days to keep
           personnel costs to a minimum because of regulations under the Fair
           Labor Standards Act.10

           Practices we identified to better ensure sufficient numbers and
           adequate deployment of personnel in a disaster situation include
           establishing response structures that employees can be "plugged"
           into and moving employees from routine service into disaster
           response. For example:

           o  The Corps and the Forest Service deploy pre-established trained
           teams to disaster locations to manage specific missions, such as
           debris removal and base camp support. These teams include
           specialists with the authority needed to provide on the ground
           procurement support to meet mission needs.

           o  In response to Katrina, Landstar, a transportation services
           company under contract to the U.S. Department of Transportation,
           diverted agents from routine customer service activities to
           emergency response activities, including staffing logistics
           staging areas, while continuing to meet the basic needs of
           commercial clients. Similarly, Wal-Mart reassigned employees from
           their regular duties in the corporate office to serve as operators
           in the company's call center for associates affected by the
           hurricane.

           In closing, in any acquisition agencies must have in place sound
           acquisition plans, processes to make and communicate good business
           decisions, and a capable acquisition workforce to monitor
           contractor performance so that the government receives good value
           for the money spent. These components are critical to successfully
           managing contracts in any environment-even in contingency
           situations such as those presented by Hurricanes Katrina and Rita.

           Mr. Chairman, this concludes my statement. I would be happy to
           respond to any questions you or other Members of the Committee may
           have at this time.

           For further information regarding this testimony, please contact
           William T. Woods at (202) 512-4841 or [email protected]. Individuals
           making key contributions to this testimony included Penny
           Augustine, James Kim, John Needham, Kenneth Patton, Matthew
           Saradjian, David Schilling, Shannon Simpson, and Katherine
           Trimble.

           Hurricane Katrina: Planning for and Management of Federal Disaster
           Recovery Contracts. GAO-06-622T . (Washington, D.C.: April 10,
           2006).

           Hurricane Katrina: Comprehensive Policies and Procedures Are
           Needed to Ensure Appropriate Use of and Accountability for
           International Assistance. GAO-06-460 . (Washington, D.C.: April 6,
           2006)

           Hurricane Katrina: Policies and Procedures Are Needed to Ensure
           Appropriate Use of and Accountability for International
           Assistance. GAO-06-600T . (Washington, D.C.: April 6, 2006).

           Hurricane Katrina: Status of the Health Care System in New Orleans
           and Difficult Decisions Related to Efforts to Rebuild It
           Approximately 6 Months After Hurricane Katrina. GAO-06-576R .
           (Washington, D.C.: March 28, 2006).

           Agency Management of Contractors Responding to Hurricanes Katrina
           and Rita. GAO-06-461R . (Washington, D.C.: March 16, 2006).

           Hurricane Katrina: GAO's Preliminary Observations Regarding
           Preparedness, Response, and Recovery. GAO-06-442T . (Washington
           D.C.: March 8, 2006).

           Emergency Preparedness and Response: Some Issues and Challenges
           Associated with Major Emergency Incidents. GAO-06-467T .
           (Washington: D.C.: February 23, 2006).

           Disaster Preparedness: Preliminary Observations on the Evacuation
           of Hospitals and Nursing Homes Due to Hurricanes. GAO-06-443R .
           (Washington: D.C.: February 16, 2006).

           Investigation: Military Meals, Ready-To-Eat Sold on eBay.
           GAO-06-410R . (Washington: D.C.: February 13, 2006).

           Expedited Assistance for Victims of Hurricanes Katrina and Rita:
           FEMA's Control Weaknesses Exposed the Government to Significant
           Fraud and Abuse. GAO-06-403T . (Washington: D.C.: February 13,
           2006).

           Statement by Comptroller General David M. Walker on GAO's
           Preliminary Observations Regarding Preparedness and Response to
           Hurricanes Katrina and Rita. GAO-06-365R . (Washington, D.C.:
           February 1, 2006).

           Federal Emergency Management Agency: Challenges for the National
           Flood Insurance Program. GAO-06-335T . (Washington, D.C.: January
           25, 2006).

           Hurricane Protection: Statutory and Regulatory Framework for Levee
           Maintenance and Emergency Response for the Lake Pontchartrain
           Project. GAO-06-322T . (Washington, D.C.: December 15, 2005).

           Hurricanes Katrina and Rita: Provision of Charitable Assistance.
           GAO-06-297T . (Washington, D.C.: December 13, 2005).

           Army Corps of Engineers: History of the Lake Pontchartrain and
           Vicinity Hurricane Protection Project. GAO-06-244T . (Washington,
           D.C.: November 9, 2005).

           Hurricanes Katrina and Rita: Preliminary Observations on
           Contracting for Response and Recovery Efforts. GAO-06-246T .
           (Washington, D.C.: November 8, 2005).

           Hurricanes Katrina and Rita: Contracting for Response and Recovery
           Efforts. GAO-06-235T . (Washington, D.C.: November 2, 2005).

           Federal Emergency Management Agency: Oversight and Management of
           the National Flood Insurance Program. GAO-06-183T . (Washington,
           D.C.: October 20, 2005).

           Federal Emergency Management Agency: Challenges Facing the
           National Flood Insurance Program. GAO-06-174T . (Washington, D.C.:
           October 18, 2005).

           Federal Emergency Management Agency: Improvements Needed to
           Enhance Oversight and Management of the National Flood Insurance
           Program. GAO-06-119 . (Washington, D.C.: October 18, 2005).

           Army Corps of Engineers: Lake Pontchartrain and Vicinity Hurricane
           Projection Project. GAO-05-1050T . (Washington, D.C.: September
           28, 2005).

           Hurricane Katrina: Providing Oversight of the Nation's
           Preparedness, Response, and Recovery Activities. GAO-05-1053T .
           (Washington, D.C.: September 28, 2005).

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        Contractor Roles in Emergency Response Operations Are Increasing

 There Was Inadequate Planning and Preparation in Anticipating Requirements for
                           Needed Goods and Services

3GAO, 21st Century Challenges: Reexamining the Base of the Federal
Government, GAO-05-325SP (Washington, D.C.: February 2005).

4GAO, Hurricane Katrina: Army Corps of Engineers Contract for Mississippi
Classrooms, GAO- 06-454 (Washington, D.C.: May 2006).

542 U.S.C. S: 5150.

  Examples of Federal, State, and Private Sector Practices for Improving
  Planning and Preparation

6GAO recently issued a decision on a protest of the terms of a
solicitation issued by the Corps for demolition and debris removal in the
State of Mississippi. The protester asserted, in part, that the Corps
decision to limit the competition for this work to Mississippi firms
improperly exceeded the authority granted under a provision of the
Stafford Act to provide a preference to firms residing, or primarily doing
business, in the area affected by a major disaster. GAO's decision did not
view the Corps decision to implement the Stafford Act preference with a
set-aside as an abuse of the agency's discretion, and the Corps did not
act improperly by limiting this competition to Mississippi firms.
AshBritt, Inc. B-297889, March 20, 2006.

7See FAR, Subpart 26.2-Disaster or Emergency Assistance Activities.

 There Was a Lack of Clearly Communicated Responsibilities across Agencies and
                                 Jurisdictions

  Examples of State and Private Sector Practices for Establishing and
  Communicating Responsibilities

There Were Insufficient Numbers and Inadequate Deployment of Personnel to
                   Provide for Effective Contractor Oversight

8Data provided by FEMA official were dated November 18, 2005.

9 The Corps manages the Operation Blue Roof mission for FEMA. Operation
Blue Roof provides assistance to storm victims in disaster areas through
the installation of rolled plastic sheeting on damaged roofs, helping to
protect property and allowing residents to remain in their homes.

  Examples of Federal and Private Sector Practices for Improving the Deployment
  of the Contracting Workforce

105 CFR S: 551.208.

Appendix I: Recent GAO Products on Hurricanes Katrina and Rita

(120556)

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Highlights of GAO-06-714T , a testimony before the Committee on Government
Reform, House of Representatives

May 4, 2006

HURRICANE KATRINA

Improving Federal Contracting Practices in Disaster Recovery Operations

The devastation experienced throughout the Gulf Coast region in the wake
of Hurricanes Katrina and Rita has called into question the government's
ability to effectively respond to such disasters. The government needs to
understand what went right and what went wrong, and to apply these lessons
to strengthen its disaster response and recovery operations.

The federal government relies on partnerships across the public and
private sectors to achieve critical results in preparing for and
responding to natural disasters, with an increasing reliance on
contractors to carry out specific aspects of its missions.

This testimony discusses how three agencies-the General Services
Administration, the Federal Emergency Management Agency (FEMA), and the
U.S. Army Corps of Engineers (the Corps)-conducted oversight of 13 key
contracts awarded to 12 contractors for hurricane response, as well as
public and private sector practices GAO identified that provide examples
of how the federal government could better manage its disaster-related
procurements.

What GAO Recommends

While GAO is not making any new recommendations in this testimony, GAO
highlights previous recommendations for improving federal procurement in
contingency operations.

Agency acquisition and contractor personnel have been recognized for their
hard work in providing the goods and services required to be responsive.
The response efforts nonetheless suffered from three primary deficiencies:

First, there was inadequate planning and preparation in anticipating
requirements for needed goods and services. Some key agencies did not
always have adequate plans for contracting in a major contingency
situation. For example, FEMA did not adequately anticipate needs for
temporary housing and public buildings. Tensions also existed between
selecting national contractors and the Stafford Act requirement for a
preference for contractors from the affected area.

Second, there was a lack of clearly communicated responsibilities for
contracting activities across agencies and jurisdictions. When disasters
occur, local or state officials sometimes determine contract requirements
and send them to FEMA, which writes and awards the contract or passes that
responsibility on to another agency. FEMA or another agency may then
oversee contract performance. Although this process requires clear
alignment of responsibilities and good communications, our fieldwork found
examples that did not meet that standard. Although the process for
ordering and delivering ice depends on good communications between FEMA
and the Corps, for example, Corps officials said FEMA did not fully
understand the contracting approach they used and ordered at least double
the amount of ice required, resulting in an oversupply of ice and a lack
of distribution sites to handle the volume ordered.

Third, there were insufficient numbers and inadequate deployment of
personnel to provide for effective contractor oversight. For example,
FEMA's contracts to install temporary housing in four states had only 17
of the 27 technical monitors that were needed for oversight.

GAO has identified practices in the public and private sectors that
provide insight into how federal agencies can better manage their
disaster-related procurements, including:

           o  developing knowledge of contractor capabilities and prices by
           identifying commodities and services and establishing vendor
           relationships before they are needed;
           o  establishing a scalable operations plan to adjust the level of
           capacity required to effectively respond to needs;
           o  formally assigning and communicating disaster-related
           responsibilities, with joint training for government and
           contractor personnel; and
           o  providing sufficient numbers of field-level contracting staff
           with the authority needed to meet mission requirements.
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