GAO urges FEMA, Corps to tighten local vendor monitoring in disaster contracts

The Government Accountability Office's latest report recommends that the Federal Emergency Management Agency and the U.S. Army Corps of Engineers create formal processes to monitor the use of local vendors in disaster-response contracts. The report also calls for clearer guidance to contracting officers on identifying the local disaster area and for stricter compliance with Federal Acquisition Regulation documentation requirements when non-local vendors are selected.

GAO found that neither agency currently tracks data on local-vendor utilization, leaving them unable to assess the extent to which contracts support the economies of declared disaster areas. Interviews revealed that some contracting officers misidentified the local area; a FEMA officer cited the entire state of Tennessee as the local area, while a Corps officer handling four Maui wildfire contracts said no official method existed to define the local area.

The review also uncovered that all sampled Corps contracts lacked the required justification files for awarding work to non-local vendors, a breach of FAR documentation rules. Without those records, the Corps cannot confirm that it has considered local-vendor preferences as mandated by law.

GAO issued four recommendations: (1) FEMA's Administrator should task the Office of the Chief Component Procurement Officer with establishing a monitoring process and assessing data reliability; (2) the Corps' Assistant Secretary for Civil Works should direct the Commanding General to do the same; (3) FEMA must ensure contracting officers receive clear communication of FAR requirements and correctly identify local disaster areas; and (4) the Corps must ensure its contracting officials document the justification for any non-local award. Both agencies have formally concurred with the recommendations.

The GAO will continue to monitor agency actions; the status of each recommendation remains open pending agency implementation.