FEMA Faulted for Awarding Undeliverable Contracts, Delaying Aid During Hurricane Season

Roberto Figueroa Caballero sits on a table in his home that was destroyed by Hurricane Maria in the La Perla neighborhood on the coast of San Juan, Puerto Rico. Roberto Figueroa Caballero sits on a table in his home that was destroyed by Hurricane Maria in the La Perla neighborhood on the coast of San Juan, Puerto Rico. Ramon Espinosa / AP

The Trump administration last year awarded contracts to companies that were ill-prepared to help victims of three major hurricanes, according to a report from Senate Democrats, leading to canceled deals and delayed delivery of essential goods.

Minority party members of the Homeland Security and Governmental Affairs Committee, led by Sen. Claire McCaskill, D-Mo., reviewed Federal Emergency Management Agency contracts for emergency tarps and plastic sheeting, both of which FEMA deploys to storm victims with roof damage as temporary relief to help them remain in their homes. The subsequent report faulted FEMA for failing to properly vet vendors, leading the agency on multiple occasions to select companies that could ultimately not deliver the supplies.

FEMA awarded contracts to two companies that had “no relevant past experience” and were either created or registered as a federal contractor within months of receiving the award. In one case, the agency last October gave two contracts worth about $40 million to a Florida company, Bronze Star, to provide 600,000 emergency tarps and 60,000 rolls of plastic sheeting. In the other, FEMA awarded a $34 million contract to Global Computers and Networks that same month to provide an additional 500,000 tarps. The agency canceled the contracts in November for failure to deliver.

The committee Democrats faulted FEMA for not doing its due diligence to ensure the companies could handle the workload, saying it should have used the “best value tradeoff” process rather than “lowest price, technically acceptable.” The Associated Press first reported the Bronze Star contract in November, and the inspector general is probing the matter.

“Once again we’ve seen massive contracts awarded to individuals and companies that would seem to have no capacity to deliver,” McCaskill said in a statement accompanying the report. “Trying to do significant contracting work during an unprecedented hurricane season is certainly difficult, but what we saw with these contracts was a failure to safeguard tax dollars and a failure to deliver desperately needed goods and services to Americans, many of whom are still dealing with the devastating effects of Hurricanes Harvey, Irma and Maria.”

William Booher, a FEMA spokesman, said the agency spent no money on the canceled contracts and did well when considering all of the support it had to solicit.

“FEMA executed [around] 2,000 contract actions for Harvey/Irma/Maria response,” Booher said in response to the report. “Less than 0.002 percent were terminated for default. Contracts were competitively awarded and reviewed.”

The senators disagreed, noting the bidding for the larger of the Bronze Star contracts was open for just two days. The average tarp and sheeting contracts during the major hurricanes were bid for three days, while five were open for just one and one solicitation gave vendors just two hours to respond. Several contracts saw their delivery date delayed considerably, such as when North Carolina-based vendor RCG pushed back its final delivery of goods by 120 days citing “government delay in coordinating delivery.”

FEMA failed to adequately use contracts that it issues in advance of storms during non-emergency times, the Democrats said, using the “prepositioned” arrangements for just 3.5 percent of the money it spent for emergency tarps and sheeting. The agency said the capacity of the companies with which it had already contracted was exhausted due to the severity of the storms, but the Democrats noted FEMA awarded two new contracts before it activated its existing deals. FEMA told the panel it would seek to better preposition itself in the future.

“FEMA plans to reevaluate its pre-positioned contracts for blue tarps to ensure sufficient capacity exists among our pre-positioned contract holders,” said Brock Long, the agency’s administrator, in a letter to McCaskill.

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