DO NOT DISTRIBUTE WITHOUT OIG AUTHORIZA

Review of the Urban Areas Security Initiative Grant Prog

 

Initiative Grant Program 

DEPARTMENT OF HOMELAND SECURITY 

Office of Inspector General 

Federal and State Oversight of the 

New York City Urban Area Security 

OIG-08-32 

TION

ramMarch 2008
 

Office of Inspector General 

U.S. Department of Homeland Security 

Washington, DC 20528

 March 26, 2008 

Preface 

The Department of Homeland Security Office of Inspector General was established by the 

Homeland Security Act of 2002 (Public Law 107-296) by amendment to the Inspector General Act 

of 1978. This is one of a series of audit, inspection, and special reports prepared as part of our 

oversight responsibilities to promote economy, efficiency, and effectiveness within the department. 

We assessed whether the Department of Homeland Security’s Office of Grants and Training and the 

State of New York established effective oversight and program monitoring of Urban Area Security 

Initiative grants awarded to the State of New York. The audit is based on interviews with employees 

and officials of relevant federal, state, and urban area agencies, institutions, working groups, and 

advisory committees; direct observations; and a review of applicable documents. 

The recommendations herein have been developed according to the best knowledge available to our 

office, and have been discussed in draft with those responsible for implementation. It is our hope 

that this report will result in more effective, efficient, and economical operations. We express our 

appreciation to all of those who contributed to the preparation of this report. 

Richard L. Skinner 

Inspector General 
 

 

 

 

 

 

 

 

Table of Contents/Abbreviations 

 Executive Summary ........................................................................................... 1

 Background......................................................................................................................................2 

Results of Audit ...............................................................................................................................6 

Improving Grant Monitoring and Oversight..............................................................................6 

Recommendations..............................................................................................................11 

 Management Comments and OIG Analysis ......................................................................13 

Improving the Ability to Measure UASI Program Success ....................................... 14 

Recommendations..............................................................................................................19 

 Management Comments and OIG Analysis.................................................... 20 

 Conclusions .............................................................................................. 21 

Appendices 

 Appendix A: Objectives, Scope, and Methodology ........................................................22 

 Appendix B: Applicable Public Laws, Regulations, and Circulars ................................25 

 Appendix C: Distribution of New York State 20% Share ..............................................26 

 Appendix D: Program Requirements - Fiscal Years 2003 to 2005 .................................28 

 Appendix E: Management’s Response to the Draft Report ............................................30 

Appendix F: Major Contributors to This Report ............................................................33 

 Appendix G: Report Distribution ....................................................................................34 

 Abbreviations 

DHS Department of Homeland Security 

FEMA Federal Emergency Management Agency 

FY Fiscal Year 

OIG Office of Inspector General 

OMB Office of Management and Budget 

UASI Urban Area Security Initiative 

Working Group New York City Urban Area Working Group 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 
OIG 

Department of Homeland Security 

Office of Inspector General 

Executive Summary 

The Urban Area Security Initiative grant program provides states and local 

governments with the funding needed in high-risk urban areas to build an 

enhanced and sustainable capacity to prevent, respond to, and recover from 

threats or acts of terrorism. This audit assessed whether (1) the Office of 

Grants and Training and the State of New York established effective oversight 

and program monitoring over the New York City urban area, and (2) Urban 

Area Security Initiative funding enhanced the area’s homeland security 

capacity as intended. The New York City urban area received $337 million 

from fiscal years 2003 to 2005, and our audit covered $244 million provided 

to the urban area’s three largest subgrantees. 

The level of federal and non-federal funding expended to enhance 

preparedness in the New York City urban area is noteworthy and indicative of 

a concerted effort at all levels to prevent and recover from terrorist attacks. 

However, improvements are needed in overseeing and monitoring grant 

expenditures, and rating the preparedness of the New York City urban area 

when viewed as a single regional entity. 

We are recommending that the Assistant Administrator, Grant Programs 

Directorate, review and act on the questionable expenditures, develop 

procedures that assure subgrantees are using funds to purchase authorized 

equipment, and collect interest earned on federal grant funds. 

We also are recommending that the Grant Programs Directorate encourage the 

State Administrative Agency to develop an automated system for all urban 

area subgrantees to report grant expenditures, use the automated information 

to verify expenditures, and provide the Directorate limited access to, or 

reports from, the system for independent monitoring and oversight of grant 

activities. 

Lastly, we are recommending that the Directorate (1) require the Urban Area 

Working Group to establish priorities and rate the preparedness of the urban 

area in total after clarifying the Woodbury Scale Rating System currently in 

use by subgrantees and (2) work with Working Group members to develop 

criteria and guidance for measuring success as it relates to goals and 

objectives. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Background 

In February 2003, the President signed Public Law 108-7 that allocated funds 

to a vital grant program available to states and local governments in support of 

the national effort to combat terrorism (Appendix B provides the complete 

title of this and other applicable public laws pertinent to the UASI grant 

program). The UASI grant program specifically provided yearly financial 

assistance to high risk urban areas to address unique planning, equipment, 

training, and exercise needs; and assist these urban areas in building an 

enhanced and sustainable capacity to prevent, respond to, and recover from 

threats or acts of terrorism. The Office of Grants and Training, formerly the 

Office for Domestic Preparedness,1 reports to the Under Secretary for 

Preparedness within DHS and is the lead federal agency for awarding grant 

funds intended to assist state and local governments in preparing for or 

responding to act of terrorism. 

Since its inception in FY 2003, the UASI grant program has experienced 

significant growth. The FY 2003 UASI Part I program resulted in grant 

awards of $96 million made directly to seven urban areas located in five states 

and the District of Columbia. Beginning with FY 2003 UASI Part II, grant 

funds were awarded to the states and then sub-granted to numerous urban 

areas. In FY 2005, $830 million in grant funds were awarded to 27 states and 

the District of Columbia for sub-grant awards to 50 urban areas. Through 

FY 2005, grant funding available totaled $2.4 billion to address the homeland 

security needs identified by state and local governments, nonprofit 

organizations, and commercial companies. New York City has received 

$337 million of the $2.4 billion, and our audit covered $244 million provided 

to the city’s three largest sub-grantees. 

Federal, state, and local roles and responsibilities as well as program funding 

and descriptions from FY 2003 to FY 2005 are discussed below: 

Office of Grants and Training (Grants & Training). Grants and Training 

oversees the UASI grant program, and provides a “one-stop-shop” for 

numerous other DHS preparedness grant programs and initiatives applicable 

to state and local “first responders”; i.e., police, fire, and emergency medical 

personnel, etc. Although Grants and Training has program management 

responsibilities for domestic preparedness grants, through FY 2005 it relied 

upon the U.S. Department of Justice, Office of the Comptroller, for grant fund 

distribution and assistance, financial management support, and financial 

monitoring of grantees. Each grant year, Grants and Training provides UASI 

1

In 2005, the Office for Domestic Preparedness became the Office of Grants and Training. The Office of Grants and 

Training became part of the Federal Emergency Management Agency (FEMA) on April 1, 2007 and was renamed the 

Grant Programs Directorate. For the purposes of this report, we will use Office of Grants and Training as the grant 

awarding entity. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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program guidance to assist state and local governments in applying for and 

administering the grant awards. Grants and Training works closely with the 

New York State Administrative Agency in its administration of the grants. 

State Administrative Agency. The New York State Office of Homeland 

Security is the State Administrative Agency2 for the New York City urban 

area with overall responsibility for conducting comprehensive urban area 

assessments and developing the statewide homeland security strategy. In 

addition, the State Administrative Agency is the single point of contact with 

Grants and Training regarding application for and administration of Grants 

and Training grant funds. 

The State Administrative Agency develops a methodology for allocating grant 

funds to sub-grantees and works through the New York City Mayor’s office to 

identify a point-of-contact to serve on the New York City Urban Area 

Working Group (Working Group). In addition, the State Administrative 

Agency monitors, oversees, and attends the Working Group meetings to 

obtain the current status of the grants but does not affect or influence the 

outcome of the rating process for the urban area’s priorities. 

New York City Urban Area Working Group. FY 2003 UASI grant 

guidance required the State of New York to develop and implement working 

groups for each high risk designated urban area. The working groups were 

responsible for coordinating, developing, and implementing all program 

elements, including the urban area assessment, homeland security strategy 

development, and any direct services Grants and Training requested or 

delivered. Grants and Training and the Working Group use the urban area 

assessment and strategy to allocate funding and guide delivery of direct 

services in the form of training, exercises, and technical assistance. 

The Working Group includes numerous participants from New York City, 

Westchester, Nassau and Suffolk Counties, the City of Yonkers,3 the 

Metropolitan Transportation Authority, the Port Authority of New York and 

New Jersey, and the New York State Office of Homeland Security. Based on 

the urban area assessments and the state homeland security strategy, the 

Grants and Training preparedness officer and the sub-grant recipients are 

required to mutually agree on a rating score for UASI fundable projects, 

however, the preparedness officer makes the final project determination. Prior 

to FY 2006, sub-grantees subjectively rated each project, however beginning 

2

 From this point forward we will use the State Administrative Agency in place of New York State Office of Homeland 

Security.

3 Prior to 2006, the City of Yonkers was represented by Westchester County.
 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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in FY 2006; the Woodbury Scale4 was used to rate the importance of each 

project (discussed in detail later in this report). 

UASI Program Funding. Under FY 2003 Part I guidance, Grants and 

Training provided UASI grant funding directly to the urban areas selected by 

the Secretary, Department of Homeland Security. Beginning with FY 2003 

Part II grants, UASI awards were made to the state, and the grant guidance 

required that the urban areas in the state receive at least 80% of the allowable 

funding with the state retaining not more than 20%. As indicated below, for 

the New York City urban area, the city itself received most of the urban area 

funding by agreement between New York’s Governor and New York City’s 

Mayor. Table 1 shows the amount received by the State for distribution to all 

urban areas, the State share, and the amount received by New York City. 

Table 1 - Summary of UASI Program Dollar Amounts 

 For the State of New York and New York City * 

(Dollars in millions) 

UASI 

GRANT 

AWARDS* 

TOTAL 

NEW YORK 

STATEAWARD** 

NEW YORK 

STATE SHARE 

(20%) 

NEW YORK 

CITY SHARE 

(80%) 

FY 2003 

Part 1 - $96 $0 N/A $25 

FY 2003 

Part 2 - $699 $135 $27 $100 

FY 2004 

$725 $79 $16 $43 

FY 2005 

$830 $221 $44 $169 *** 

*	 Data provided by State Administrative Agency and New York City Criminal Justice 

Coordinator. 

** Includes money for New York City and Buffalo urban areas for FYs 2003 through 

2005, Albany urban area for FY 2004, and funding of the state’s share. 

*** New York City used $3.1 million to supplement the Law Enforcement Terrorism 

Prevention Program because Congress reduced funding in FY 2005 by 25 percent. 

•	 Fiscal Year 2003 - UASI Program Part I. FY 2003 Part I grant funding 

totaled $96 million and was awarded directly to seven urban areas: New 

York City, the National Capital Region, Los Angeles, Seattle, Chicago, 

San Francisco, and Houston. Funding for this program was determined by 

a formula using a combination of current threat estimates, critical assets, 

and population density within the specified urban areas. 

4

 Intended to evaluate grantee progress in meeting the goals and objectives of the state’s homeland security strategy as 

well as meeting national priorities. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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•

•

New York City received $25 million, which it used to fund police and fire 

department homeland security activities. The activities were funded based 

on a plan, which identified and justified the use of the funds. According to 

New York State personnel, all funds were expended by December 31, 

2006, and the grant is now in the final closeout phase. 

Fiscal Year 2003 - UASI Program Part II. FY 2003 Part II provided 

$699 million in grant funding to 19 states and the District of Columbia for 

subsequent distribution to 30 urban areas including the 7 urban areas 

funded by Part I. New York City received $100 million. Grants and 

Training allowed New York State to retain 20% of the total grant to cover 

administrative expenses; however, the state distributed the entire amount 

to the New York City and Buffalo Urban Areas. See Appendix C for a 

breakdown of state share distribution. New York City distributed its funds 

to the following eight agencies: 

• Department of Environmental Protection, 

• Department of Information Technology and Telecommunications, 

• Office of Emergency Management, 

• Fire Department, 

• Department of Transportation, 

• Police Department, 

• Department of Health and Mental Hygiene, and 

• The Health Hospitals Corporation. 

Grants and Training based grant awards on a formula that considered 

population density, critical infrastructure, and current threat estimates as 

articulated in urban areas’ strategic plans. Grants and Training required 

the recipients to provide budgets detailing their needs before issuing the 

funds. This process resulted in long delays and extensions up until 

December 31, 2006. 

Fiscal Year 2004 - UASI Program. The FY 2004 UASI grant program 

provided $725 million in discretionary grants to 27 states and the District 

of Columbia for 50 urban areas -- some previously identified areas and 

some new ones. Of the $725 million, New York City received $43 million 

and used all of it to cover orange alert overtime for the police department.5 

Grants and Training made an exception to the overtime cap for FY 2004 

UASI funding; therefore, 100% of the funding was applied to personnel 

and fringe benefits for the police department. 

5

 Funding from UASI, other federal grants, and state, and local governments were used to cover orange alert activities 

including the Republican National Convention in New York City. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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In an effort to expedite the process to local governments, Grants and 

Training advanced the funds and relied on the entities to submit 

expenditure reports. [Subsequent to the issuance of our draft report, the 

Grant Programs Directorate, the successor to Grant and Training asked us 

to clarify the above by indicating that the Directorate requires grantees to 

maintain a minimum of cash on hand.] All funds were expended by the 

end of the first quarter of 2005. As with FY 2003, Grants and Training 

based grant awards on a formula that considered population density, 

critical infrastructure, and current threat estimates as articulated in urban 

areas’ strategic plans. 

•	 Fiscal Year 2005 - UASI Program. FY 2005 UASI grants totaled 

$830 million for 50 urban areas located in 27 states and the District of 

Columbia. New York City received $169 million. In FY 2005, Congress 

waived the Cash Management Improvement Act of 19906

 [31 USC 3335 

and 31 USC 6503] allowing the funds to flow better. The State 

Administrative Agency administered the funds on a reimbursement basis 

allowing the recipients to provide a budget detailing their needs before 

issuing the funds. FY 2005 funds remained available through March 31, 

2007, the end date of the grant performance period. 

FY 2005 funding allocations changed from previous allocations in that 

they were based on credible threats, the presence of critical infrastructure, 

vulnerability, population, population density, law enforcement 

investigative and enforcement activity, and the existence of formal mutual 

aid agreements. 

Results of Audit 

Grants and Training, the State Administrative Agency, the New York City 

urban area, and related department, agency, and authority officials have 

demonstrated a commitment to preventing, deterring, responding to, and 

recovering from terrorist attacks. This commitment is evidenced by their 

efforts and the level of federal and non-federal funding expended in the New 

York City urban area to enhance preparedness since FY 2003. However, 

improvements are needed in overseeing and monitoring the grants and rating 

the preparedness of the New York City urban area when viewed as a single 

regional entity. 

Improving Grant Monitoring and Oversight 

Grants and Training and the State Administrative Agency can strengthen 

controls over grant spending by enhancing the monitoring and oversight 

6

 In 2006, the waiver became permanent. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

Page 6 
processes related to grant execution. In their efforts to have grant funds 

released and expended more timely, Grants and Training and the State 

Administrative Agency have not performed the same level of in-depth 

monitoring as was performed during FY 2003 of the UASI grant program. 

Specifically, neither Grants and Training nor the State Administrative Agency 

enhanced their post award monitoring of expenditures. Enhancing the 

monitoring processes within Grants and Training and the State Administrative 

Agency could reduce potential unauthorized expenditures. 

Expenditures against the FY 2003 UASI Program Part II grant, including 

$3.17 million for an automated student health record system, $160,949 for 

landlord administrative fees, and other smaller items such as newspaper 

subscriptions, did not have supporting documentation in Grants and Training 

and State Administrative Agency files. Therefore, we considered these 

expenditures questionable and requested additional information. 

Grants and Training agreed that the expenditures identified above, when 

considered at face value, are questionable and would require more 

information. When asked for additional support, Grants and Training had 

little information on file that would justify these expenditures. Our research 

on these questionable areas is discussed below: 

•	 While the New York City urban area requested and justified the automated 

student health record system to monitor suspected health problems within 

the school system and to detect a bio-terrorism as early as possible, school 

personnel using the system stated the automated system replaced a manual 

system and had no bio-terrorism application. Grants and Training 

personnel indicated a higher-level DHS official provided approval on the 

urban area’s request to obtain the system. 

During a January 2007 meeting, New York City officials pointed out to us 

that the automated health system was included in their initial strategic plan 

that was approved by Grants and Training and again in a recent letter from 

Grants and Training. City officials viewed the approval of the strategic 

plan as authorization to make expenditures. Therefore, any subsequent 

review of expenditures would result in unnecessary micro-management by 

federal and state officials. Further, these officials stated that grant 

program funds were approved based on the urban area’s strategic goals 

and objectives and that funding decisions as to how to meet those goals 

and objectives were left up to the urban area. 

Our review of the urban area’s initial strategic plan confirmed that the 

automated student health record system was included in the plan approved 

by Grants and Training and the State Administrative Agency. However, 

despite the city’s comments to the contrary, federal and state officials are 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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responsible for overseeing financial and programmatic execution of grant 

terms and conditions. This includes periodic verification of expenditures 

to assure that the urban area is achieving or has achieved the goals and 

objectives articulated in its strategic plan. 

Subsequent to our fieldwork, Grants and Training provided additional 

information regarding the automated student health record system 

discussed above. Grants and Training indicated the system 

... was an approved expense as part of a syndromic[7] surveillance 

system for the Public Health Department. The Capabilities Division is 

certain that the automated student health record contains a bioterrorism application and possibly the appropriate school personnel 

were not interviewed. 

•	 At the end of our audit fieldwork, Grants and Training had not determined 

the validity of the landlord administrative fees paid for with grant funds. 

•	 The State Administrative Agency provided Grants and Training with 

support from New York City stating that newspapers and news magazines 

offered open sources of intelligence to assist the urban area in identifying 

and analyzing terrorist threats in a timely and useful fashion. 

As discussed below, Grants and Training and the State Administrative Agency 

need to make improvements in the monitoring of individual expenditures, 

interest collections, and on-hand assets. Better monitoring and oversight 

processes would provide Grants and Training and the State Administrative 

Agency with the ability to advise urban area grant recipients not to make 

unauthorized expenditures or to require additional support justifying 

expenditures. 

Monitoring Individual Expenditures 

The New York City Criminal Justice Coordinator served as the focal point to 

collect and monitor the expenditures for all New York City agencies. This 

paper-intensive process required the Coordinator to obtain copies of purchase 

orders generated by the grant recipients and to prepare expenditure reports 

summarizing all expenditures related to the UASI grant. These reports were 

then forwarded to the State Administrative Agency for further reporting to 

Grants and Training. 

To provide in-depth monitoring of grant expenditures and to verify the 

eligibility of those expenditures, Grants and Training and the State 

Administrative Agency would require copies of all purchase orders and 

7

 A syndrome is a complex of symptoms indicating the existence of an undesirable condition or quality. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

Page 8 
monitoring reports regularly submitted by the grant recipients. The State 

Administrative Agency recognized the difficulty in reviewing all purchase 

orders and has initiated steps to improve its monitoring capabilities. One 

option being considered is a software module that could be added to the 

statewide online database that could be used by all grant recipients to report 

grant expenditures. Currently, the statewide system is used for grant 

application and tracking. New York City did not have a central database to 

monitor the expenditures of its eight sub-grantees; instead, they tracked 

expenditures through a paper-intensive method of monitoring and overseeing 

grant execution. However, the State Administrative Agency is currently 

working with the city, the largest urban area grant recipient, on ways to 

incorporate the city into the system and to develop ways to improve on line 

financial reporting and accountability. 

New York City officials stated they rely on an extensive internal control 

system, the citywide financial management system, city budget process, and 

internal and external audits to monitor city and agency spending. City 

officials also said they rely on feedback they receive from Grants and Training 

yearly visits as an indicator of New York City urban area performance in 

executing grant requirements. While the comments offered by New York City 

officials indicated a degree of expenditure monitoring and oversight, the 

volume and dollar amount of New York City transactions in a paper driven 

system makes monitoring expenditures by Grants and Training and the State 

Administrative Agency difficult and time consuming. Automating the process 

would allow for enhanced monitoring and would allow for eliminating 

questionable and potential duplicate expenditures. 

Monitoring Interest Collections 

The New York City Criminal Justice Coordinator reported $1.15 million in 

accrued interest earned on grant funds advanced to New York City but the 

interest has not been remitted to the federal government. In this instance 

retaining the interest earned on federal grant funds violates the Cash 

Management Improvement Act of 1990 (31 USC 6503(c)(1)). 

Table 2 below shows the interest earned by New York City as reported to the 

State Administrative Agency and, in turn, to Grants and Training in its 

quarterly fiscal cost reports beginning with the second quarter of 2005. 

Table 2 – Interest earned on grant funds advanced to New York City 

Quarter/FY Period Amount 

Second/2005 Oct. 2003 - Jun. 2005 $936,032 

Third/2005 Jul. 2005 - Sep. 2005 114,446 

Fourth/2005 Oct. 2005 - Dec. 2005 101,308 

Total $1,151,786 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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The Department of Justice’s Office of Justice Programs originally identified 

the accrued interest during a November 2004 on-site monitoring visit 

requested by the DHS Office for Domestic Preparedness. The Office of 

Justice Programs recommended that the New York State Division of Criminal 

Justice Services remit the accrued interest to the U.S. Department of Health 

and Human Services. 

Because the grant funds were administered by the State Administrative 

Agency and had not yet been remitted, in May 2005, Grants and Training 

requested that the State Administrative Agency remit the interest to the U.S. 

Treasury rather than the U.S. Department of Health and Human Services. 

Grants and Training, State Administrative Agency, and New York City 

officials were unsure as to when the interest earned on federal funds needed to 

be remitted to the U.S. Treasury but indicated that the interest may not be due 

until the grant is closed out. In January 2007, Grants and Training, State 

Administrative Agency, and New York City officials stated they would 

research the issue of when to remit the interest and determine how much 

interest has currently been earned. Subsequent to our fieldwork, Grants and 

Training directed the grantee to return the interest already earned, to return 

interest thereafter on a quarterly basis, and to report interest on its Financial 

Status Report (Standard Form -269) 

Monitoring On-Hand Assets 

New York City could not easily monitor on-hand assets because it had not 

developed a citywide database to do so. New York City and two of the three 

sub-grant agencies we visited could only identify UASI funded nonexpendable equipment by reviewing individual purchase orders. Further, our 

review of equipment inventory procedures at the three sub-grant agencies 

showed that each used a different method of controlling and reporting assets. 

Developing a citywide database would enable the city to monitor on-hand 

assets; increase the visibility of quantities, locations, and availability of assets 

during response and recovery efforts; and help avoid duplicate assets. Details 

of our review are discussed below. 

•	 One agency’s Office of Homeland Security Grants maintained a 

centralized database. This office made inputs into its database based on 

notification from the various agency divisions that expenditures against 

the grant had been made. When the divisions failed to provide copies of 

purchase orders or otherwise notify the grants office of the expenditure 

and acquisition of the asset, a record was not created in the database. 

Further, this system was not accessible outside of the grants office. 

However, separate databases and tracking mechanisms for grant funded 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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equipment acquisitions were developed within the other divisions. During 

our inventory, we noted two such databases already in existence. 

•	 The other two agencies could not provide complete supporting 

documentation identifying equipment purchased with UASI funds. For 

example, one agency provided us a list of equipment that they 

subsequently determined was a wish list of equipment to be purchased 

with UASI funds. We later received a new list from the agency’s 

accounting department, but the list contained a variety of equipment items 

purchased with UASI and other DHS grant funds. Divisions and precincts 

in those agencies kept spreadsheets, budgets, wish lists, and copies of 

purchase orders to support grant funded equipment acquisitions but those 

records were not always indicative of on-hand assets. As such, we could 

not always reconcile assets physically located on site against the inventory 

records. Furthermore, some equipment was purchased with multiple 

funding sources, and it was not clear where the equipment was reported. 

Some divisions were developing their own databases to track and monitor 

on-hand assets. 

During our January 2007 meeting, city officials indicated they were 

working with other Working Group members on a citywide assets and 

logistics management system that could be used for the entire urban area. 

Recommendations 

We recommend that the Assistant Administrator, Grant Programs 

Directorate: 

Recommendation #1: Review the landlord administrative fee 

expenditure to determine the applicability for funding by the UASI 

program and take appropriate actions. 

Recommendation #2: Implement monitoring procedures that assure that 

grantees and sub-grantees use UASI funds to purchase authorized 

equipment. 

Recommendation #3: In coordination with the State Administrative 

Agency, collect the $1.15 million in interest earned on federal grant funds 

through the fourth quarter of FY 2005 and any interest earned thereafter. 

Recommendation #4: Encourage the State Administrative Agency to: 

•	 Develop an online database to report grant expenditures for use by 

all urban area sub-grantees, 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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•	 Use the database to perform periodic independent verifications of 

expenditures and on-hand assets, and 

•	 Provide the Office of Grants and Training access to, or reports 

from, the statewide database to allow for independent monitoring 

and oversight of expenditures, inventories of on-hand assets, and 

interest collections. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Management Comments and OIG Analysis 

Management Comments to the Recommendations 

For Recommendation #1, the Financial Accountability and Oversight Division 

(FAO) will review the landlord administrative fee with the grantee to 

determine the eligibility of the fee for UASI program funding. 

In response to Recommendation #2, the Acting Assistant Administrator did 

not agree that additional monitoring procedures were needed to assure that 

grantees and sub-grantees use UASI funds to purchase authorized equipment. 

The Grant Programs Directorate has a robust grantee monitoring protocol in 

place and the Grant Development and Administration Division has been 

monitoring all 50 States and the Territories on an annual basis, and the Urban 

Area participants every 2 years. Additionally, the Financial Accountability 

and Oversight Division conducts financial monitoring of FEMA grantees. 

The Preparedness Officer assigned to New York State has frequent contact 

with both the State Administrative Agency and New York City regarding 

authorized equipment. For FY 2003 grants, grantees were required to submit 

detailed budget worksheets identifying every item to be purchased with grant 

funds. 

The $1.15 million in interest earned on federal grant funds has been returned 

to the federal government as we suggested in Recommendation #3. 

In response to Recommendation #4, the Grant Programs Directorate did not 

agree that it should encourage the state to implement a specific information 

system. Rather, it encourages states to implement the best available means to 

gather and track data. Additionally, Directorate officials said that State 

Administrative Agencies are held to their state’s rules and regulations 

regarding the responsible administration of federal grant funds for the direct 

oversight of sub-recipients’ management of DHS passed through funds. In 

addition, the State Administrative Agencies are responsible for implementing 

processes that will ensure compliance with DHS guidance requirements and 

other Federal rules and regulations. 

OIG Analysis 

The Grant Programs Directorate’s response to Recommendation #1 and 

Recommendation # 3 meet the intent of those recommendations. 

Regarding Recommendation #2 and Recommendation #4, the report 

recognizes that the level of federal and non-federal funds expended in the 

New York City urban area shows a concerted effort to prevent and recover 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

Page 13
 
 

from terrorist attacks. Throughout our fieldwork and in this report, we 

recognize the extensive monitoring efforts of Grant Program Directorate staff. 

The intent of Recommendation #2 was to highlight some areas at the State 

Administrative Agency and urban area levels needing improvement so that the 

Grant Programs Directorate could implement additional processes to enhance 

its programmatic and financial monitoring. The Grant Programs Directorate 

has enhanced its grant guidance to states and urban areas since the inception 

of the UASI grant program in FY 2003, and has demonstrated its robust 

programmatic and financial monitoring protocols in recent years. Therefore, 

we accept the Directorate’s comment that no additional monitoring procedures 

are needed at this time. 

The Directorate’s comment to Recommendation #4 regarding its 

encouragement to states on implementing the best available means to gather 

and track data meets the intent of the recommendation. As with 

Recommendation 2, our intent was have the Grant Program Directorate urge 

the state to streamline its processes to help the state better monitor grant 

expenditures and determine the eligibility of those expenditures and to make 

programmatic and financial monitoring at the federal level easier. 

Improving the Ability to Measure UASI Program Success 

The New York City urban area, when viewed as a single entity, cannot 

measure the intended effect of using UASI funds to build an enhanced and 

sustainable capacity to prevent, respond to, and recover from threats or acts of 

terrorism. However, each member of the area subjectively measured their 

individual successes and capabilities based on funding expended from all 

sources for equipment, training, and exercises. Urban area-wide capacities 

were not measured because the Working Group did not prioritize funding of 

projects as a group, rate the preparedness of the urban area collectively, or 

fully understand the Woodbury Rating System. In addition, the measurement 

of enhanced and sustainable homeland security capacities cannot be 

determined solely from the expenditure of UASI funds but rather should be 

determined from the total federal and non-federal investment in these 

capacities. Therefore, the recently reported ratings for measuring the intended 

effect of using UASI funds are misleading. 

Grant guidance from Grants and Training required designated urban areas to 

establish working groups that would be responsible for coordinating the 

development and implementation of all program elements, including the urban 

area assessment, strategy development, and any direct services delivered by 

Grants and Training. The guidance required the state to semi-annually report 

its progress in executing the grant. Categorical/Discretionary Assistance 

Progress Reports included a general, subjective statement regarding progress 

in the areas of acquiring equipment, training, and exercises. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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According to Appendix C of the FY 2006 Office of Grants and Training 

Strategic Monitoring Protocols for Eastern, Central, and Western Division: 

Preparedness Officers will need to focus their strategic 

monitoring on two fronts: (1) the progress made in 

achieving Goals and Objectives stated in the most recently 

approved Homeland Security Strategy; and (2) progress 

made in accomplishing the National Priorities issued under 

the guidance of Homeland Security Presidential 

Directive - 8. 

In its efforts to measure enhanced homeland security capabilities and to show 

progress in meeting national priorities, Grants and Training provided grantees 

the Woodbury Scale as a means to move from subjective assessments of 

capabilities to a more objective and quantifiable methodology. The 

Woodbury Scale, when properly applied, was intended to evaluate grantee 

progress in meeting the goals and objectives of the state’s homeland security 

strategy as well as meeting national priorities. The rating/scoring of priority 

areas or goals is described in Table 3 below: 

Table 3 – Woodbury Scale 

Rating/Score Description 

0 Priority area/goal not being addressed 

1 Priority area/goal identified 

2 Initial efforts have commenced 

3 Efforts are well on the way 

4 Priority area/goal nearing completion 

5 Priority area/goal completely addressed 

While the Grants and Training preparedness officer and the grant recipient 

mutually agree on a rating score based on grant execution, the preparedness 

officer makes the final determination concerning priority areas and goals. 

Measuring program success has been problematic for the four reasons 

discussed below. 

1.	 The Working Group did not prioritize the funding of projects as an 

urban area. 

The Working Group serves as the executive steering committee to provide 

overall governance of the UASI program. The Working Group’s mission is to 

maximize the efforts of jurisdictions in the metropolitan area to prevent, 

prepare for, respond to, and recover from acts of terrorism and events 

involving weapons of mass destruction. The Working Group should link and 

coordinate activities such as equipment acquisitions, joint training and 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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exercises, public education and outreach, and the development of response 

protocols under various grant programs; e.g., UASI grant program and other 

homeland security grant programs. Further, the Working Group is tasked with 

conducting urban area assessments and developing urban area homeland 

security strategies. The Working Group consists of multi-jurisdictional and 

multi-disciplinary members from all contiguous jurisdictions and mutual aide 

partners. 

Despite its formidable mission, the Working Group worked well at developing 

their strategies and plans, developing exercises and response protocols, and 

other key areas for strengthening the response to terrorist actions. However, 

until recently, setting and funding urban area priorities as a single entity was 

not an issue dealt with by the Working Group. We met with city officials in 

January 2007 during which we were told that the Working Group decided that 

urban area-wide priorities were not actively considered because, as discussed 

below, all urban area funding in the early years of the UASI program went 

directly to New York City. Both Grants and Training and State 

Administrative Agency officials stated that the meetings we monitored during 

the audit were the Working Group’s first efforts at looking at priorities and 

funding as a single regional entity. Prior to this, each Working Group 

member developed individual funding priorities for the use of UASI funds. 

Grants and Training UASI grant guidance (FY 2003 Part II through FY 2005) 

required urban areas to receive at least 80% of the authorized funding with the 

state retaining not more than 20%. Although all eight members of the 

Working Group qualified for urban area grant funding, the full 80% for urban 

area members went to only one member -- New York City -- as decided by the 

State Governor in conjunction with the City Mayor. At the Governor’s 

discretion, a portion of the remaining 20%, representing the state’s share 

intended to fund state purposes, was distributed among the other Working 

Group members. Appendix C shows how the state distributed its 20% share 

as direct “unmarked” funding allocations to various UASI sub-grantees. 

Many of these sub-grantees received other state share funds for specific 

agencies or projects, i.e. “marked” funding. 

Since the Working Group’s mission is to maximize the efforts of jurisdictions 

in the metropolitan area, it should have assessed and evaluated the needs of all 

Working Group members and developed a prioritized list of projects covering 

the entire urban area. By doing so, the Working Group could have funded the 

highest priority projects that benefited the urban area as a whole. However, 

the manner in which UASI grant program funds were distributed undermined 

the Working Group’s control over urban area priorities and funding decisions. 

It also increased the potential for funding lower priority projects before 

funding a project that may have been a higher priority project when viewing 

the urban area as a whole. In addition, Working Group members, other than 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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New York City, were limited in funding long-term, high cost projects thereby 

extending project completion unless other sources of funds were found. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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2.	 Woodbury Scale ratings were not accurate. 

Grants and Training and the Working Group first used the Woodbury Scale in 

June 2006 in an attempt to collectively rate/measure projects against state and 

national homeland security goals and objectives. Each Working Group 

member provided a Woodbury Scale ranking of between zero and five for 

how they saw the urban area’s current status in regards to state and national 

goals and objectives. Working Group members agreed that the rating that 

received the most votes would be the rating used for the whole urban area. 

We observed the June 2006 monitoring meeting and concluded that the 

Working Group representatives had different approaches for determining their 

numeric rating and, as a result, ratings assigned to state and national goals and 

objectives were not accurate. For example, some members gave ratings based 

on their own jurisdiction while others gave ratings based on what they thought 

the overall urban area should receive. Some believed they deserved a higher 

rating of accomplishment within the urban area when viewed as a whole but 

they were unable to assess the ratings for other jurisdictions. Furthermore, 

members were concerned about rating themselves at a one or two for each 

strategy and national priority, because they were concerned that the public 

would misinterpret their ratings to mean that they were not as prepared as they 

should be since 9-11. In addition, it became apparent during the meeting that 

some members’ ratings were based on the ratings given by those who spoke 

up first or were based on New York City’s assessment. Collectively, the “ad 

hoc” methodology in determining Woodbury Score ratings reduced the 

Working Group’s ability to provide a well-founded rating for the urban area as 

a whole. 

3.	 Working Group members were not familiar with the Woodbury 

Scale. 

The Working Group members and represented jurisdictions were not familiar 

with the Woodbury Scale as a means to measure enhanced homeland security 

capabilities and to show progress in meeting national priorities. During the 

June 2006 meeting, the representatives indicated that they required specific 

guidance, not previously provided, and more time to prepare for the rating. 

Repeatedly, the members asked questions as to what each individual rating 

meant in an attempt to determine a consistent basis for ratings given by each 

member. 

The Working Group could not support an overall urban area rating on the state 

and national goals and objectives addressed during the meeting because the 

rating process lacked any pre-established rating or measurement criteria. For 

example, each jurisdiction identified its own critical infrastructures and 

individually rated the measures taken to protect that infrastructure. However, 

the Working Group did not identify or prioritize critical infrastructure on an 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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urban area-wide basis. While one large jurisdiction like New York City could 

have its “efforts well under way” (Woodbury Scale rating of 3), other 

surrounding jurisdictions could have similar critical infrastructure protections 

that had not been addressed or had just been identified (Woodbury Scale 

ratings of 0 or 1). Without pre-established rating and measurement criteria, 

the Working Group could not assign an accurate rating to state and national 

goals and objectives. 

4. Woodbury Scale ratings were not based solely on UASI funding. 

The ratings provided during the monitoring meeting were not determined on 

the basis of UASI grant funds alone. Therefore, the Working Group could not 

effectively coordinate the development and implementation of all UASI grant 

program elements or accurately report its progress in executing the grant. 

Some Working Group members rated progress on the basis of all federal and 

non-federal funds spent on homeland security improvements. This included 

grants from the Homeland Security Grant Program, Law Enforcement 

Terrorism Prevention Program, Urban Area Security Initiative, COPS’ 

Homeland Security Overtime Program, Citizen Corps, and Metropolitan 

Medical Response System, as well state and local funds. These 

representatives indicated that measuring progress solely on UASI funding 

could result in Woodbury Scores of one (priority area/goal identified) or 

two (initial efforts have commenced). On the other hand, considering all 

sources of funding would result in higher scores. While the Working Group 

members provided compelling reasons why all homeland security funding 

should be considered, the layering effect of all funding source provides a 

misleading rating for the benefits of using UASI funds. In that regard, Grants 

and Training should determine the most effective means to determine UASI 

grant programs effectiveness. 

Recommendations 

We recommend that the Assistant Administrator, Grant Programs 

Directorate: 

Recommendation #5: Require that the New York City Urban Area 

Working Group (1) establish critical infrastructure funding priorities 

relative to the urban area as a whole, and (2) rate the preparedness of the 

urban area when viewed as a single regional entity. 

Recommendation #6: Provide the Working Group members clear 

guidance on the use of the Woodbury Scale Rating System, and work with 

Working Group members to develop criteria for measuring success as it 

relates to UASI goals and objectives. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Management Comments and OIG Analysis 

Management Comments to the Recommendations 

The Grant Programs Directorate did not concur with Recommendation #5 and 

stated that the New York City Urban Area is required to develop and 

implement an Urban Area Homeland Security Strategy and fund projects 

accordingly. The New York City Urban Area does have an operational Urban 

Area Working Group, and progress is being made in the implementation of 

memoranda of understanding, joint projects, etc. Additionally, the Grant 

Programs Directorate emphasized that there is a long-standing agreement 

within New York State such that New York City has received the UASI funds 

and the State funded the rest of the Urban Area from the State funds. 

Likewise, the Grant Programs Directorate did not concur with 

Recommendation #6 because Directorate officials thought we placed too 

much emphasis placed on the Woodbury Scale as a measure of meeting UASI 

Program goals and objectives. Those officials pointed out that (1) the 

Woodbury Scale is only one measure used to identify the progress states and 

urban areas make in implementing their homeland security strategies 

(2) FY 2006 was the first year the Scale was used as a measure, and (3) it is 

certainly likely that some members of the Urban Area Working Group were 

unfamiliar with the Scale, unclear as to its use, or uncomfortable with the 

self-reporting mechanism included in the Scale and part of the monitoring 

process. 

OIG Analysis 

We agree with the Grant Programs Directorate regarding the existence of an 

urban area homeland security strategy, the establishment of the urban area 

working group, and the Governor’s agreement with the New York City Mayor 

that the 80% share of UASI program funds would be provided to New York 

City. 

The Directorate’s response to Recommendation #5 falls short of addressing 

the points we made in that recommendation; namely that the Working Group 

establish critical infrastructure funding priorities relative to the urban area as a 

whole, and rate the preparedness of the urban area when viewed as a single 

regional entity. The response does recognize that “...progress is being made 

in the implementation of memoranda of understanding, joint projects, etc.” but 

provides little information as to what the outcomes of the memoranda of 

understand and joint projects will be, and when these actions will be 

completed. 

While our report does place a substantial amount of emphasis on the use of the 

Woodbury Scale Rating System, the Directorate’s response to 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Recommendation #6 did not address the second part of that recommendation 

wherein we recommended that Directorate officials work with the Working 

Group to develop criteria for measuring success as it relates to UASI goals 

and objectives. The responses allude to measures other than the Woodbury 

Scale Rating System that are used to identify the progress states and urban 

areas make in implementing their homeland security strategies but does not 

identify those measures or how program effectiveness is determined. 

Furthermore, the responses recognize the first time use of the rating system 

and the likelihood that Working Group members were unfamiliar with the 

Scale, unclear as to its use, or uncomfortable with the self-reporting 

mechanism but do not address if or how this situation will be remedied. 

Conclusions 

Recent and on-going efforts by the State Administrative Agency and the 

Working Group members and their departmental/agency representatives in 

building an enhanced and sustainable homeland security capacity are 

noteworthy. Specifically: 

•	 Efforts by the State Administrative Agency to implement a statewide 

online database system and other methods for improving oversight should 

enhance the monitoring of UASI spending and assets. In addition, it could 

enable Grants and Training and the State Administrative Agency to follow 

through with analyses on issues that warrant further verification. 

•	 Progress made at the May 2006 Working Group meeting to distribute 

funds to all Working Group members should move the Working Group 

towards the setting of overall funding priorities and accurately matching 

critical infrastructure throughout the urban area to available funding. This 

process could replace the previous method of New York City receiving the 

full 80% of initial UASI funding provided by the state while the remaining 

members received their funding from the state’s portion. 

•	 On-going and planned efforts by individual agencies, such as the three we 

visited during the audit, should lead to improved monitoring of on-hand 

assets and their availability. However, instead of funding three separate 

databases, funding could be considered for efforts in developing a single 

urban area-wide database to track and monitor assets. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix A 

Objectives, Scope, and Methodology 

The audit objectives were to determine whether: (1) the Department of 

Homeland Security’s (DHS) Office of Grants and Training and the State of 

New York established effective oversight and program monitoring over the 

New York City urban area, and (2) UASI preparedness funding enhanced the 

urban area’s capacity to prevent, respond to, and recover from threats or acts 

of terrorism. 

We conducted the audit fieldwork from April 2006 to July 2006 and reviewed 

federal and state oversight and monitoring of FY 2003, FY 2004, and 

FY 2005 UASI funds allocated and spent by New York City. We reviewed: 

(1) UASI appropriations authorized by Public Laws 108-7, 108-11, 108-90 

and 108- 334; (2) applicable federal and state regulations including Title 28, 

Code of Federal Regulations, Section 66.40 and OMB Circular A-103, Grants 

and Cooperative Agreements with State and Local Government, both of which 

discuss on monitoring and reporting program performance; (3) applicable 

Grants and Training UASI program guidelines; and (4) various congressional 

reports and newspaper articles related to the UASI grant program. 

Audit fieldwork covered four review components: 

•	 Office of Grants and Training Headquarters in Washington, DC 

•	 New York State Office of Homeland Security in Albany, NY 

•	 New York City Offices (Office of Management and Budget and Office 

of the Criminal Justice Coordinator) 

•	 New York City Agencies (The Department of Health and Mental 

Hygiene, Fire Department, and Police Department) 

During the audit, we (1) reviewed program policies, procedures, and controls 

used to monitor UASI grants; (2) reviewed program documentation, 

(3) interviewed responsible officials, and (4) as appropriate to the location 

visited, physically inspected some of the equipment purchased with UASI 

funds. 

Office of Grants and Training Headquarters 

We researched and obtained background information on UASI grants 

provided to New York and obtained UASI guidelines and program policies 

and procedures used in the allocation of these grants. We reviewed program 

grant files, evaluated Grants and Training monitoring practices and controls 

over the expenditures of the funds, and reviewed applicable management and 

monitoring reports. To gain an understanding of oversight and monitoring 

responsibilities, we interviewed personnel from the External Oversight 

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Appendix A 

Objectives, Scope, and Methodology 

Division and the Office of Grants Operations, as well as the preparedness 

officer for New York State. 

New York State Office of Homeland Security 

We obtained background information on the UASI grants from officials at the 

New York State Office of Homeland Security and interviewed officials from 

the Division of Criminal Justice Services to identify New York State 

guidelines and program policies and procedures used to monitor grant 

progress. We were presented a briefing on the state’s database and reviewed 

program files used to track UASI funding, evaluated state monitoring 

practices and controls over expenditures, and reviewed applicable 

management and monitoring reports. We interviewed financial personnel to 

gain an understanding of their methodology in reporting expenditures and 

reviewed a memorandum of understanding between the state and New York 

City outlining mutual responsibilities for the purpose of providing financial 

assistance. Finally, we determined that previous audit work performed by the 

state internal auditors differed from our work in that it only covered the 

Buffalo urban area. Thus, it was excluded from our review. 

New York City Offices 

Since the city’s Office of Management and Budget coordinated with the state 

regarding financial assistance provided to the city, we obtained background 

information on the financial operations of the grants and interviewed key 

personnel to identify the procedures used in administering the grants. We also 

reviewed program files and interviewed personnel from the Office of the 

Criminal Justice Coordinator to gain an understanding of their methodology 

for reporting the financial information. Finally, we visited three city agencies 

as discussed below. 

New York City Agencies 

•	 The Department of Health and Mental Hygiene is responsible for all 

health-related issues in response to weapons of mass destruction attacks in 

the New York urban area. The department receives about half a billion 

dollars a year in grants from various sources and separately tracks each 

grant. UASI funding comes from the state to the city’s Office of 

Management and Budget8

 that in turn distributes the funds to the 

department and other city agencies. The department then distributes the 

funds among 24 different projects. 

8

 The UASI grant is the only one that is processed through the City’s Office of Management and Budget. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix A 

Objectives, Scope, and Methodology 

•	 The Fire Department is responsible for protecting the life and property of 

the city through its response to fire and medical emergencies. 

•	 The Police Department is responsible for responding safely and effectively 

in the event of an attack involving a weapon of mass destruction. 

For all three city agencies, we visited several locations throughout New York 

City to review training and exercise records, equipment, and to interview 

personnel regarding processes or systems in place to track UASI funding and 

measure grant performance. 

The audit was conducted under the authority of The Inspector General Act of 

1978, as amended, and according to the Government Auditing Standards 

prescribed by the Comptroller General of the United States. 

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Appendix B 

Applicable Public Laws, Regulations, and Circulars 

FY 03 UASI I, Consolidated Appropriations Resolution, Public Law 108-7, 

enacted February 20, 2003. Conference Report 108-10 page 637 (High Threat 

Urban Area) 

FY 03 UASI II, Emergency Wartime Supplemental Appropriations Act of 

2003, Pub. L. 108-11, enacted April 16, 2003 

FY 04 UASI III, Homeland Security Appropriation Act, Public Law.108-090, 

enacted October 1, 2003 

FY 05 UASI IV, Homeland Security Appropriation Act, Pub. L. 108-334, 

enacted October, 18, 2004 

Cash Management Improvement Act of 1990 [31 USC 3335 and 31 USC 

6503] 

Title 28, Code of Federal Regulations, Section 66.40 

Title 2, Code of Federal Regulations, Grants and Agreements 

OMB Circular A-102, Grants and Cooperative Agreements with State and 

Local Government 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix C 

Distribution of New York State 20 Percent Share 

FY 2003 (Part II) FY 2004 FY 2005 

Amounts represent 20% state’s share (See Table 

1) $ 27,053,321 $ 15,942,149 $ 44,216,581 

UASI FUND RECIPIENTS 

Port Authority of New York and New Jersey $ 5,300,387 $ 749,945 $ 13,000,000 

Nassau County Office of Emergency Management 2,000,000 1,000,000 2,000,000 

Nassau County Police Department 0 0 100,000 

Suffolk County Dept. of Fire Rescue and Emergency 2,000,000 1,000,000 2,000,000 

Suffolk County Police Department 0 0 100,000 

Westchester County Dept. of Emergency Services 2,000,000 1,000,000 2,000,000 

Westchester County Dept. of Public Safety 0 0 100,000 

Division Military Naval Affairs/Orange Alert 3,886,449 0 0 

New York State Police 2,363,550 0 0 

New York Division of Criminal Justice Services 755,368 0 0 

New York State Thruway Authority 0 0 2,750,000 

New York State Department of Motor Vehicles 0 0 1,080,000 

Mount Vernon Fire Department 0 0 250,000 

New Rochelle Fire Department 0 0 250,000 

White Plain Public Safety 0 0 250,000 

Yonkers Fire Department 0 0 500,000 

Queens Manhattan DA 0 0 750,000 

Non-Profit Supplemental 0 0 1,100,000 

UASI Local Grants Uncommitted 0 0 516,599 

Metropolitan Transportation Agency 6,694,245 16,131,689 5,000,000 

Non-Profit 0 0 6,311,701 

Other Urban Areas 2,053,321 3,369,867 1,441,599 

State UASI 0 0 6,576,133 

Notes: 

1.	 Data provided by State Administrative Agency (not audited). 

2.	 This chart illustrates the breakdown of funding according to the New York State’s 

discretion. 

3.	 The amounts listed on line one represent the 20% share of the UASI funding that New York 

State was authorized to maintain by applicable Public Laws (See Appendix B). 

4.	 This chart indicates that New York State distributed its entire share including its 

Management and Administration portion to all the urban areas. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix C 

Distribution of New York State 20 Percent Share 

5.	 Westchester, Suffolk, and Nassau counties received $1 or $2 million each year, or $5 million 

total. 

6.	 On face value, it appeared that the state originally retained more then 20%. However in 

some of the cases, such as Metropolitan Transportation Agency and the Port Authority of 

New York and New Jersey, a portion of the funds listed on chart came from earmarked 

funds designated by the Grants and Training guidance. Those earmarked funds were not 

part of the 20% but were shown by the State Administrative Agency as UASI funds. Over 

the years, there have been other types of UASI grants that were agency specific. Based on 

documents reviewed at the State Administrative Agency, we could not determine how much 

came out of the State Administrative Agency’s share or went directly to the two agencies 

from these other funds. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix D 

Program Requirements – Fiscal Years 2003 to 2005 

Fiscal Year 2003 UASI Part 1. The program required grant 

recipients to submit: (a) financial status reports within 45 days at the 

end of each calendar quarter that the award is active, (b) program 

progress reports within 30 days after the end of the reporting periods 

of June 30 and December 31 for the life of the award; and 

(c) financial and compliance audit reports no later than 9 months 

after the end of the recipient’s fiscal year if the recipients expended 

$300,000 [now $500,000] or more of federal funds during their 

fiscal year. 

The state was required to develop and implement urban area 

working groups and an urban area assessment and strategy 

development component to be used by Grants and Training and the 

working groups to allocate funding and guide delivery of direct 

services in the form of training, exercises, and technical assistance. 

The assessment9

 was intended to support the development of an 

urban area homeland security strategy, thus providing a roadmap for 

sustainable prevention and preparedness and guiding the allocation 

of grant funds and direct services provided by Grants and Training. 

Fiscal Year 2003 UASI Part II. The program required the State to 

sub-grant at least 80% of the total grant award to the selected urban 

area(s) within 45 days of the receipt of funds and to use up to 20% to 

complement state assets that provide direct assistance to the urban 

areas excluding any administrative costs. The reporting 

requirements were the same as for the FY 2003-UASI Part I 

program. In addition, recipients could use up to 25% of the gross 

amount of their award to reimburse for operational expenses, 

including overtime costs for personnel and costs associated with 

increased security measures at critical infrastructure sites incurred 

during the Orange Alerts in 2003. 

Fiscal Year 2004. The program required the State to sub-grant at 

least 80% of the total grant award to the selected urban area(s) 

within 60 days of the receipt of funds. Funding distribution was 

classified under five categories: 1) planning: 2) equipment 

acquisitions: 3) training: 4) exercises, and 5) management and 

administrative. Other than a three percent cap on management and 

administrative funds, there were no restrictions on allocations of 

funds across these categories. 

9

 The assessment must be coordinated with and developed jointly by the core city, core county/counties, the state, and 

any other jurisdictions designated by the core city, core county/counties, or the state. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix D 

Program Requirements – Fiscal Years 2003 to 2005 

Fiscal Year 2005. Grants and Training consolidated six programs10 

in a single grant award in an effort to streamline funding to states 

and territories. Grants and Training was required to obligate the 

funds no later than 60 days after the enactment of the Public Law 

108-334 and states were required to sub-grant at least 80% of the 

funds to local units of government within 60 days of receiving the 

funds. The reporting requirements stayed the same as those 

stipulated for the FY 2004-UASI program. 

10 The Homeland Security Grant Program; Urban Areas Security Initiative; Law Enforcement Terrorism Prevention 

Program; Citizen Corps Program; Emergency Management Performance Grants; and the Metropolitan Medical 

Response Team Program Grants. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix E 

Management’s Responses to the Draft Report 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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________________________________________________________________________ 

________________________________________________________________________ 

________________________________________________________________________ 

Appendix E 

Management’s Response to the Draft Report 

Response to the OIG Draft Report: Federal and State Oversight of the New York City Urban Area 

Security Initiative Grant Program 

Recommendation #1: Review the landlord administrative fee expenditure to determine 

applicability for funding by the UASI Program and take appropriate actions. 

Response: The Financial Accountability and Oversight Division (FAO) within FEMA’s Grant 

Programs Directorate will work with the Grantee to acquire, review, and determine eligibility of the 

landlord administrative fee. 

Recommendation #2: Implement monitoring procedures that assure that grantees and sub-grantees 

use UASI funds to purchase authorized equipment. 

Response: FEMA does not concur with this recommendation as the Grant Programs Directorate 

(GPD) within FEMA has a robust grantee monitoring protocol in place. The Grant Development & 

Administration Division within GPD has been monitoring all 50 States and the Territories on an 

annual basis, and the Urban Area participants every 2 years. Additionally, the Financial 

Accountability & Oversight Division within GPD conducts financial monitoring of FEMA grantees. 

In addition to on-site monitoring, the Grant Development & Administration’s Preparedness Officer 

assigned to New York State has frequent contact with both the State Administrative Agency and 

New York City regarding authorized equipment. For FY 2003 grants, grantees were required to 

submit detailed budget worksheets identifying every item to be purchased with grant funds. 

Recommendation #3: In coordination with the State Administrative Agency, collect the $1.15 

million in interest earned on federal grant funds through the fourth quarter of FY 2005 and any 

interest earned thereafter. 

Response: FEMA has addressed this issue and the interest has been returned to the Department of 

Health and Human Services as required. No additional corrective action is required for this 

recommendation and it is recommended that it be closed. 

Recommendation #4: Encourage the State Administrative Agency to: 

•	 Develop an online database to report grant expenditures for use by all urban area subgrantees, 

•	 Use the database to perform periodic independent verifications of expenditures and onhand asset, and 

•	 Provide the Office of Grants and Training access to, or reports from, the statewide 

database to allow for independent monitoring and oversight of expenditures, inventories 

of on-hand assets, and interest collections. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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________________________________________________________________________ 

________________________________________________________________________ 

Appendix E 

Management’s Responses to the Draft Report 

Response: FEMA does not concur with this recommendation. It is neither the stated purpose nor the 

desired aim of FEMA to require States to implement specific information management systems. 

However, FEMA does encourage the States to implement the best available means to gather and 

track data. 

Additionally, SAAs are held to their State’s rules and regulations for the responsible administration 

of federal grant funds and implementing processes that will ensure compliance with DHS guidance 

requirements and other Federal rules and regulations. The SAAs are responsible for the direct 

oversight of sub-recipients’ management of DHS passed through funds. 

Recommendation #5: Require that the New York City Urban Area Working Group 1) establish 

critical infrastructure funding priorities relative to the urban area as a whole, and 2) rate the 

preparedness of the urban area when viewed as a single regional entity 

Response: FEMA does not concur with this recommendation. The New York City Urban Area, like 

the other urban areas in the Country, is required to develop and implement an Urban Area Homeland 

Security Strategy and fund projects accordingly. The New York City Urban Area does have an 

operational Urban Area Working Group, and progress is being made in the implementation of 

memoranda of understanding, joint projects, etc. Additionally, it needs to be emphasized that there is 

a long-standing agreement within New York State such that New York City has received the UASI 

funds and the State has funded the rest of the Urban Area from the State funds. 

Recommendation #6: Provide the Working Group members clear guidance on the use of the 

Woodbury Scale Rating System, and work with Working Group members to develop criteria for 

measuring success as it relates to UASI goals and objectives. 

Response: FEMA does not concur with this recommendation because too much emphasis has been 

placed on the Woodbury Scale in this Report. It is but one measure used to identify the progress 

States and Urban Areas have made in implementing their Homeland Security Strategies. In addition, 

FY 2006 was the first year the Scale was used as a measure and it is certainly likely that some 

members of the Urban Area Working Group were unfamiliar with the Scale, unclear as to its use, or 

uncomfortable with the self-reporting mechanism included in the Scale and part of the monitoring 

process. 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

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Appendix F 

Major Contributors to This Report 

Robert J. Lastrico, Audit Division Director 

John A. Richards, Audit Manager 

Arona Maiava, Auditor 

Montul Long, Auditor 

Venetia Gatus, Auditor 

Paulette Solomon, Auditor 

Mark S. Phillips, Referencer 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

Page 33 
Appendix G 

Report Distribution 

Department of Homeland Security 

Secretary 

Deputy Secretary 

Chief of Staff 

General Counsel 

Executive Secretary 

Under Secretary, Management 

Chief Financial Officer 

Chief Information Officer 

Assistant Secretary, Public Affairs 

Assistant Secretary, Policy 

Assistant Secretary, Legislative Affairs 

Chief Security Officer 

DHS GAO/OIG Liaison 

Federal Emergency Management Agency 

Administrator 

Acting Assistant Administrator, Grant Programs Directorate 

Acting Director, Financial Accountability and Oversight Division 

OIG Audit Liaison 

Office of Management and Budget 

Chief, Homeland Security Bureau 

DHS OIG Budget Examiner 

Congress 

Congressional Oversight and Appropriations Committees, as appropriate 

Federal and State Oversight of New York City Urban Areas Security Initiative Grant Program 

Page 34 
 

Additional Information and Copies 

To obtain additional copies of this report, call the Office of Inspector General 

(OIG) at (202) 254-4199, fax your request to (202) 254-4305, or visit the OIG web 

site at www.dhs.gov/oig. 

OIG Hotline 

To report alleged fraud, waste, abuse or mismanagement, or any other kind of 

criminal or noncriminal misconduct relative to department programs or 

operations: 

• Call our Hotline at 1-800-323-8603; 

• Fax the complaint directly to us at (202) 254-4292; 

• Email us at DHSOIGHOTLINE@dhs.gov; or 

•	 Write to us at: 

DHS Office of Inspector General/MAIL STOP 2600, Attention: 

Office of Investigations - Hotline, 245 Murray Drive, SW, Building 410, 

Washington, DC 20528. 

The OIG seeks to protect the identity of each writer and caller.