FEMA Should Recover $13 Million of Grant Funds Awarded to The Administrators of the Tulane Educational Fund, New Orleans, Louisiana

The Administrators of the Tulane Educational Fund(Tulane) received a Federal Emergency Management Agency (FEMA) Public Assistance award of $291.9 Million for damages caused by Hurricane Katrina in August 2005. The objective our audit was to determine whether Tulane accounted for and expended the FEMA grant funds correctly. Tulane’s contractor could not support or justify $13.0 million of the $36.1 million (gross) that we audited. These findings occurred because (1) the contractor could not show that it actually incurred the costs that it billed Tulane; (2) Tulane did not ensure that its contractor’s billings were valid, eligible, and supported; and (3) Louisiana, as the grantee, did not effectively execute its responsibilities to ensure compliance with Federal regulations and FEMA guidelines.