CPI: FEMA disbursement delays after OIG findings

On July 30, 2020, the Centro de Periodismo Investigativo reported that four agencies — Housing, Education, Transportation and Public Works, and AAA — faced delays in disbursement of FEMA recovery funds after Irma and María for not fully correcting findings from 2019 audits by the Department of Homeland Security OIG.

Ottmar Chávez Piñero, then COR3 director, said the findings do not stop FEMA from continuing to approve funds, but they do affect disbursement: COR3 would not release pending money until the agencies certified corrections. Obligating is not disbursing. As of July 20, 2020, FEMA had obligated $2,072,775,349 in Public Assistance to those four agencies; the government had received $1,664,726,276 (80.3%), mostly in Housing. The rest remained in planning, evaluation and audit compliance.

The audits (Williams, Adley & Company–DC) did not impose penalties; they issued recommendations on Categories A and B (debris and protective measures) from September 2017 to December 2018. They faulted FEMA and COR3 for insufficient technical assistance on payroll, contracts and procurement. At DTOP, of 11 contracts (~$229 million) they found contractors outside SAM.gov and Uniform Rules clauses missing in three debris contracts for $500,000; as of July 20 DTOP had $254.9 million obligated and $183.6 million disbursed (72%).

At Housing, overtime errors in a sample of 15 employees: six underpaid ($3,846.60) and nine overpaid ($3,650.27). At AAA, contracts without a SAM certificate and $72,304 overclaimed on generators for incorrect KW recording. At Education, late reimbursements; $307.0 million obligated and only $34.7 million disbursed (11.3%), mostly Category B — a period that coincides with Julia Keleher’s tenure, already charged in another federal case.

None of the four had closed all findings, per the CPI. Chávez objected on points before FEMA Region II on June 18; Gerardo Mena (COR3 compliance) said biweekly follow-up with no clear closing date. An audit and a disbursement delay are not a conviction for theft.