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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