The Palm Beach County School District, Florida (District) received a $34.0 million grant award from the Florida Division of Emergency Management (Florida), a Federal Emergency Management Agency (FEMA) grantee, for Hurricane Wilma damages in October 2005. The District did not comply with Federal procurement standards or record retention requirements for contracts valued at $9.2 million. Florida, as the grantee, was responsible for ensuring that the District was aware of and followed all Federal requirements. In fact, the District’s 2006 Single Audit report disclosed these problems, yet we found no evidence that either Florida or the District did anything to correct them. As a result, full and open competition did not occur, and the risk that fraud, waste, and abuse occurred is high. Normally, we would question such improper costs; however, we do not in this case because FEMA said the costs were reasonable and allowed the costs at project closeout using the agency’s authority granted under 44 Code of Federal Regulations (CFR) 13.6(c). We also determined that the District claimed $33,239 of costs that were ineligible because it did not credit its claim for rebates it received for installing energy efficient roofs provided for under the award.
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