We determined that Downe Township did not always follow Federal procurement standards in awarding contracts for disaster work. We recommended that FEMA disallow $832,040 of $2.5 million in grant funds awarded to the Township. The Township did not have support for $445,385 of the questioned costs. We also recommended that the Administrator, FEMA Region II, deobligate unused project costs, and withhold $2.3 million in funds requested for additional project work until New Jersey provides assurance that the Township complies with all Federal procurement standards for FEMA funded work. FEMA Region II concurred with all of our recommendations.