During 2004, the Louisiana Legislative Auditor and our office issued Audit reports on the State’s management of the Hazard Mitigation, Unmet Needs, and Flood Mitigation Assistance grant programs. The scope of our 2004 audit included funding for the Hazard Mitigation Grant Program and Unmet Needs programs totaling $40,524,912 in Direct project costs and administrative and management costs from Eight disasters declared between September 1998 and October 2002. We recommended that, among other actions, FEMA identify and deobligate any ineligible, unsupported, or duplicate funding. In March 2005, as a result of our recommendations, FEMA Region VI started the process of recouping $30.4 million from the State. By May 2007, the State had provided FEMA Region VI with sufficient documentation to reduce the original debt from $30.4 million to $26.6 million. In July 2010, the Regional Administrator, after applying cost overruns, reduced the debt to $23.1 million and referred it to the FEMA Finance Center in September 2010 for issuance of the Bill for Collection. In January 2012, the FEMA Finance Center transferred the debt to Treasury. As of May 2014, Treasury still held the uncollected debt.
FEMA’s Efforts To Collect a $23.1 Million Debt from the State of Louisiana Should Have Been More Aggressive