Department of Homeland Security
 

The State of Michigan’s Management of State


Homeland Security Program and Urban Areas Security


Initiative Grants Awarded During Fiscal Years 2007


Through 2009 

OIG-12-114 August 2012
 
_ 

. ..,. 

; " ~ 

OFFICE OF INSPECTOR GENERAL ~ .. ~ "«"IJ'@ Department of Homeland Security 

Washington. DC 20528 1 www.oig.dhs.gov 

AUG 30 .2012 

MEMORANDUM FOR: Elizabeth M. Harman 

Assistant Administrator 

Grant Programs Directorate 

Federal Emergency Management Agency 

FROM: Anne L Richards f2""", /W~' Assistant Inspector General for Audits 

SUBJECT: The State of Michigan's Management of State Homeland 

Security Program and Urban Areas Security Initiative 

Grants Awarded During Fiscal Years 2007 Through 2009 

Attached for your action is our final report, The State of Michigan's Management 0/ 

State Homeland Security Program and Urban Areas Security Initiative Grants Awarded 

During Fiscal Years 2007 Through 2009. We incorporated the formal comments from 

the Office of Policy and Program Analysis and State of Michigan officials in the final 

report. 

The report contains nine recommendations aimed at improving the State's management 

of State Homeland Security Program and Urban Areas Security Initiative grants. Your 

office concurred with all nine recommendations. State of Michigan officials also agreed 

with the recommendations. Based on information provided in your response to the 

draft report, we consider recommendations 1, 4, 5, 6, and 9 resolved and open. Once 

your office has fully implemented the recommendations, please submit a formal 

closeout letter to us within 30 days so that we may close the recommendations. The 

memorandum should be accompanied by evidence of completion of agreed-upon 

corrective actions and of the disposition of any monetary amounts. 

Recommendations 2, 3, 7, and 8 remain unresolved and open. As prescribed by the 

Department of Homeland Security Directive 077-1, Follow-Up and Resolutions for the 

Office of Inspector General Report Recommendations, w ithin 90 days of the date of this 

memorandum, please provide our office with a written response that includes your 

(1) agreement or disagreement, (2) corrective action plan, and (3) target completion 

date for each recommendation. Also, please include responsible parties and any other 

supporting documentation necessary to inform us about the current status of the 

recommendation. Until your response is received and evaluated, the recommendations 

w ill be considered open and unresolved. 
 

 

 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Consistent with our responsibility under the Inspector General Act, we are providing 

copies of our report to appropriate congressional committees with oversight and 

appropriation responsibility over the Department of Homeland Security. We will post 

the report on our website for public dissemination. 

Please call me with any questions, or your staff may contact Mark Bell, Deputy Assistant 

Inspector General for Audits, at (202) 254-4100. 

Attachment 

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Table of Contents 

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


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


Results of Audit .................................................................................................................. 2 


The State of Michigan’s Grants Management Practices Were Generally Effective, 


But Improvements Are Needed ................................................................................ 2
 

UASI Regional Funds .................................................................................................... 3
 

Recommendations ....................................................................................................... 7 


Management Comments and OIG Analysis ................................................................. 8
 

Oversight and Monitoring ............................................................................................ 9
 

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


Management Comments and OIG Analysis ............................................................... 11
 

Federal Procurement Standards ................................................................................ 12 


Recommendations ..................................................................................................... 13 


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

Federal Inventory and Property Standards ................................................................ 14 


Recommendation ....................................................................................................... 16 


Management Comments and OIG Analysis ............................................................... 16
 

State Administrative Agency’s Approval Processes ................................................... 17
 

Recommendation ....................................................................................................... 19 


Management Comments and OIG Analysis ............................................................... 19
 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

www.oig.dhs.gov OIG-12-114 
 

 

 

 

 

 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendixes 

Appendix A: Objectives, Scope, and Methodology ................................................ 20 

Appendix B: Management Comments to the Draft Report ................................... 22 

Appendix C FEMA Homeland Security Grant Program ......................................... 33 

Appendix D: State Homeland Security Program and Urban Areas Security 

Initiative Funding ............................................................................... 34 


Appendix E: Project/Allowable Cost Approval Process .......................................... 35
 

Appendix F: Schedule of Monetary Findings ......................................................... 36
 

Appendix G: Major Contributors to This Report .................................................... 37 


Appendix H: Report Distribution ............................................................................ 38 


Abbreviations 

CFR Code of Federal Regulations 

DHS Department of Homeland Security 

EHP Environmental and Historical Preservation 

EMHSD Emergency Management and Homeland Security Division 

FEMA Federal Emergency Management Agency 

FY fiscal year 

HSGP Homeland Security Grant Program 

OIG Office of Inspector General 

SAA State Administrative Agency 

SHSP State Homeland Security Program 

UASI Urban Areas Security Initiative 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Executive Summary 

The Department of Homeland Security (DHS) Office of Inspector General (OIG) has 

completed an audit of the State of Michigan’s management of State Homeland Security 

Program and Urban Areas Security Initiative grants in accordance with Public Law 110­

53, Implementing Recommendations of the 9/11 Commission Act of 2007. The audit 

objectives were to determine whether the State of Michigan spent grant funds 

effectively and efficiently and complied with applicable Federal laws and regulations; 

and the extent to which funds awarded enhanced its ability to prevent, prepare for, 

protect against, and respond to natural disasters, acts of terrorism, and other manmade 

disasters. The audit included a review of approximately $98 million in State Homeland 

Security Program and Urban Areas Security Initiative grants awarded to the State of 

Michigan during fiscal years 2007 through 2009. 

The State of Michigan generally spent grant funds effectively, efficiently, and in 

compliance with applicable Federal laws and regulations. However, it did not ensure 

that the Urban Area Board conducted sufficient oversight of Urban Areas Security 

Initiative grant funds, that funds were allocated proportionate to associated risk, or that 

State actions regarding the use of regional funds were transparent. In addition, the 

State of Michigan did not have adequate oversight controls in place to ensure that 

subgrantees implement only projects aligned with approved investment justifications; 

follow Federal procurement and property standards; and receive grant funds in a timely 

manner. The State of Michigan has recently implemented a process to measure its 

preparedness. However, because of the recent implementation of this change, we did 

not evaluate the new process. 

Our nine recommendations call for the Federal Emergency Management Agency (FEMA) 

to initiate improvements which, when implemented, should help strengthen program 

management, performance, and oversight. FEMA concurred with all nine 

recommendations. State of Michigan officials also agreed with the recommendations. 

Written comments to the draft report are incorporated as appropriate and included in 

their entirety in appendix B. 

www.oig.dhs.gov 1 OIG-12-114 
 

 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Background 

FEMA awarded the State of Michigan (State) approximately $111.8 million in Homeland 

Security Grant Program (HSGP) funds during fiscal years (FYs) 2007 through 2009. As 

part of this program, the State received $98 million for State Homeland Security 

Program (SHSP) and Urban Areas Security Initiative (UASI) grants. (See appendix D for 

total SHSP/UASI grant funds by year.) 

In 2003, by Executive order, the Governor of Michigan designated the Michigan State 

Police Emergency Management Division and the Director of the Department of State 

Police to administer homeland security response activities. The division was renamed 

the Emergency Management and Homeland Security Division (EMHSD) in 2006. In 2009, 

another Executive order reaffirmed the EMHSD as the State Administrative Agency 

(SAA) for HSGP funds. The EMHSD (grantee) administers all HSGP funds in addition to 

its other emergency management responsibilities. The Director of the Department of 

State Police serves as the State Director of Emergency Management and Homeland 

Security. 

In February 2008, DHS OIG issued a report on the State of Michigan’s use of grant 

funds.1

 OIG concluded that the SAA did an adequate job administering program 

requirements related to identifying statewide needs and strategy, disbursing grant 

funds, and ensuring that all of the available funds were used. However, the SAA did not 

have a documented analysis of how effective its efforts had been in preparing first 

responders for terrorist incidents. All recommendations were resolved and closed in 

July 2010. 

Results of Audit 

The State of Michigan’s Grants Management Practices Were Generally 

Effective, But Improvements Are Needed 

The State of Michigan generally spent grant funds effectively, efficiently, and in 

compliance with applicable Federal laws and regulations. Its strategic plans 

linked funding to all-hazards capabilities and to goals that were established 

based on risk assessments. It also implemented a process to approve allowable 

grant-related costs before subgrantees expended funds and requested 

reimbursements. (See appendix E for a description of the project/allowable cost 

approval process.) 

1 The State of Michigan’s Management of State Homeland Security Grants Awarded During Fiscal Years 

2002 through 2004 (OIG-08-26), dated February 2008. 

www.oig.dhs.gov 2 OIG-12-114 
 

 

 

 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

However, although the SAA had a noteworthy process to approve allowable 

grant-related costs, it did not ensure that the Urban Area Board conducted 

sufficient oversight of UASI grant funds, that funds were allocated proportionate 

to associated risk, or that SAA actions regarding the use of regional funds were 

transparent. In addition, the SAA did not have adequate oversight controls in 

place to ensure that subgrantees implemented only projects aligned with 

approved investment justifications, followed Federal procurement and property 

standards, and received grant funds in a timely manner. 

UASI Regional Funds 

The Fiscal Years 2007 through 2009 Homeland Security Grant Program Guidance 

and Application Kits state that the UASI program is intended to enhance regional 

preparedness efforts. Urban areas must use these funds to employ regional 

approaches. However, we identified the need for improved oversight by the 

UASI Board of funds provided to the UASI regions. In addition, the UASI funding 

methodology to the counties appears disproportionate to the associated risks, 

and the SAA is not transparent on how it uses the UASI funds for the region’s 

priorities. 

Oversight of UASI Funds 

With the creation of the UASI program in 2003, DHS determined that the cities of 

Detroit, Sterling Heights, Warren, and a 10-mile buffer extending from the 

border of the combined urban area were at highest risk. With DHS’ acceptance, 

the SAA expanded the urban area in 2006 when it created seven statewide 

Homeland Security Regions, as shown in figure 1. One of the seven statewide 

regions (Region 2) was designated as the urban area.2

 The EMHSD believed that 

regionalization would help subgrantees coordinate preparedness activities more 

effectively, spread costs, and share risk, thereby increasing the overall return on 

investment. 

2

 The current UASI region is made up of the City of Detroit and the counties of Macomb, Monroe, 

Oakland, St. Clair, Washtenaw, and Wayne. It includes 219 cities, villages, and townships. 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Figure 1. Current Homeland Security Regions and Urban Areas Security Initiative 

Region 2 Composition 

Note: There is no Region 4. 


Source: State of Michigan – Emergency Management & Homeland Security.
 

After the expansion of the UASI, the UASI Board was developed and charged 

with enhancing both inter- and intraregional capabilities to mitigate, protect 

against, respond to, and recover from large-scale disasters or other catastrophic 

events. The UASI Board is made up of voting members from the City of Detroit; 

the counties of Macomb, Monroe, Oakland, St. Clair, Washtenaw, and Wayne; 

and nonvoting members from disciplines such as health, maritime, and transit. 

According to the Southeast Michigan Urban Area Security Initiative Board ByLaws, one of the Board’s objectives is “Determining program priorities and 

subsequent funding allocations to enhance homeland security capabilities for 

the region through the established process for the current grant cycle.” The 

process established by the Board uses committees that are aligned with each of 

the UASI regional investments. All issues and recommendations for spending 

grant funds come from the committees and are brought to the UASI Board for 

approval. This process reflects a unified approach and regional coordination, but 

it is used only to oversee the “regional” funds. There is no Board oversight of the 

“local” funds allocated to each of the six counties. 

Of the total amount of UASI funding that the State receives from FEMA, the SAA 

is allowed to use 20 percent for direct support of the urban area. The remaining 

funds are allocated to the UASI region using two different methods. First, up to 

25 percent is used for projects that must benefit the UASI region as a whole; 

these are considered the “regional” funds that the UASI Board oversees with the 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

help of the investment committees. The remaining “local” funds, approximately 

75 percent, are allocated to the six counties that make up the UASI region 

through a risk-based methodology. However, there was no evidence of 

oversight of these funds and there was no process in place in the Board By-laws 

as to who would ensure that these funds were spent properly or track progress 

on these projects. Table 1 identifies the dollar amounts for funds allocated 

during FYs 2007–2009. 

Table 1. UASI Funding Allocation 

Award Allocation FY 2007 FY 2008 FY 2009 Total 

SAA share $ 2,926,000 $ 2,838,200 $ 2,696,320 $8,460,520 

“Regional” share $ 1,800,817 $ 2,838,200 $ 2,696,320 $7,335,337 

“Local” share $ 9,903,183 $ 8,514,600 $ 8,088,960 $26,506,743 

Total $14,630,000 $14,191,000 $13,481,600 $42,302,600 

Source: DHS OIG. 

During interviews with UASI region personnel, issues concerning the need for 

oversight by the UASI Board were raised. For example, one county representative 

said that he has concerns that some regions might be spending local funds on 

projects that do not necessarily match the objectives and strategy for the region. 

An official from another county said that there is no formal process in place to 

tell his county what to do with its money. A third county representative said that 

counties are supposed to report to the UASI Board on the projects funded with 

their local share, but only that county has done so. In addition to the need for 

oversight by the UASI Board, one official said that the counties within the region 

do not communicate with each other, resulting in possible duplication of efforts, 

specifically with regard to equipment purchases. UASI Board members 

acknowledged this issue, as documented in their board meeting minutes. 

According to the Fiscal Year 2009 Homeland Security Grant Program Guidance 

and Application Kit, the Urban Area Working Group (in this case, the Southeast 

Michigan UASI Board) is responsible for coordinating the development and 

implementation of all program initiatives. Further, the working group must 

ensure that its approach to critical issues such as grant management, grant 

administration, and funding allocation methodologies is formalized in a working 

group charter or other form of standard operating procedure related to the UASI 

governance. Although the By-laws are clear on the purpose and objectives of 

the Board, we saw no evidence of standard operating procedures on spending 

and project oversight by the Board for the more than $26 million in “local” UASI 

funds during FYs 2007–2009. 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Risk-based Allocation 

The “local” share of the UASI funds is allocated to the six counties comprising the 

UASI area using a risk-based allocation method with four key criteria: 

population, population density, critical infrastructure/key assets, and Superfund 

Amendments and Reauthorization Act Title III sites (emergency planning on 

hazardous and toxic chemical sites). However, before the local share funds are 

allocated, the SAA gives each of the six counties an equal baseline amount. 

According to SAA officials, this baseline allotment is approximately 18 percent of 

the local funds available. According to the Fiscal Years 2007 through 2009 

Homeland Security Grant Program Guidance and Application Kits, all the funds 

that each county receives may be used to fund projects or buy equipment that 

each county deems necessary, as long as the funds are used to achieve the UASI 

region’s goals, objectives, and priorities in the UASI strategy. 

An SAA official said that the SAA’s reason for giving a baseline amount to each 

county was to follow a process similar to FEMA’s HSGP funding allocation 

methodology, whereby each of the 56 States and U.S. Territories receives a 

baseline amount before allocating based on risk. We note that FEMA included 

the HSGP baseline allocation because it was mandated by law, and States are not 

required to provide a baseline amount. 

The SAA’s funding allocation method does not appear to maximize financial 

assistance to meet the needs of the urban areas with the highest threat and 

population density, as intended by the UASI program. According to SAA officials, 

all counties in the UASI region receive a baseline amount before risk-based 

allocations are made. This funding model, which includes regional, baseline, and 

risk-based allocations, results in areas with the largest populations and 

potentially highest risk receiving a less-than-proportionate share of UASI funds. 

The SAA’s Use of UASI Funds 

The SAA says that it places a very high priority on ensuring that all HSGP projects 

reflect regional coordination and establish specific capability-based outcomes. 

However, the SAA can be more transparent on how funds are being used to 

meet the UASI region’s investments detailed in the UASI strategy. According to 

the Fiscal Years 2007 through 2009 Homeland Security Grant Program Guidance 

and Application Kits, the SAA must obligate 80 percent of the funds awarded 

under UASI grant to local units of government, and may use the other 20 percent 

at its discretion for the betterment of the UASI region. For FYs 2007–2009, the 

SAA retained almost $8.5 million (see table 1). 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Several UASI regional personnel we interviewed said they were unaware of how 

the SAA-retained funds are benefiting the region. For example, one official said 

that they are not sure what the SAA does with its portion of the UASI funds. 

Another official said that there is a limited amount of transparency over the 

money the SAA uses, and wishes the SAA could provide them with more 

information to show how the funds are helping the region. A lack of 

communication among the SAA, UASI Board, and city and county officials seems 

to be the main reason for the uncertainty. 

The Fiscal Years 2007 through 2009 Homeland Security Grant Program Guidance 

and Application Kits state that any UASI funds retained by the State must be 

used in direct support of the urban area. Furthermore, States must provide 

documentation to the Urban Area Working Group (UASI Board) and FEMA upon 

request demonstrating how any UASI funds retained by the State would directly 

support the urban area. 

Written procedures that are effectively implemented on the oversight of all UASI 

funds, along with improved communication between the principal UASI 

agencies, may enhance both inter- and intraregional capabilities to mitigate, 

protect against, respond to, and recover from disasters or other catastrophic 

events. In addition, even though there was no evidence of waste, better 

oversight and communication may help avoid wasting grant funds on duplicate 

projects, equipment, and training. 

Recommendations 

We recommend that the Assistant Administrator, Grant Programs Directorate for 

the Federal Emergency Management Agency: 

Recommendation #1: 

Direct the SAA to direct the UASI Board to establish procedures on oversight 

responsibilities over all UASI funds to ensure that all regional and local projects 

and investments are coordinated, projects are implemented, and progress is 

tracked. 

Recommendation #2: 

Direct the SAA to review the UASI funding allocation methodology to ensure that 

funds are spent on the highest-risk areas within the UASI region. 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Recommendation #3: 

Direct the SAA to provide documentation to the UASI Board and region officials 

showing how funds retained by the SAA have been used to support the urban 

area. 

Management Comments and OIG Analysis 

FEMA concurred with recommendations 1, 2, and 3. In early 2011, language was 

added to the Urban Area Working Group Charter and subgrantee award 

documents to ensure meaningful local and regional coordination and 

collaboration of project activity. FEMA stated that in September 2012, it will 

monitor the UASI on-site and will verify that improvements to UASI oversight 

and coordination processes are being implemented efficiently and effectively 

and are consistent with UASI program guidance. 

FEMA recommends that recommendations 2 and 3 remain open for 90 days or 

until the SAA is able to demonstrate to FEMA that (1) UASI funds are being 

applied proportionate to areas of highest risk within the UASI region, and 

(2) programs and projects supported with UASI funds retained by the SAA are 

applied to programs and projects that directly support the urban area and are 

shared and coordinated with the UASI Board. 

The SAA agreed with recommendations 1, 2, and 3. According to the SAA, it has 

taken steps to improve the efficiency and effectiveness of the UASI program. 

The SAA directed the UASI Board to establish oversight procedures for all UASI 

funds to ensure that all investments and regional and local projects are 

coordinated and implemented, and that progress is tracked. The SAA’s 

directives were included in the grant agreement beginning with the FY 2010 

HSGP award. 

The SAA stated that it has reviewed the UASI funding allocation methodology 

and believes that the methodology does ensure that funds are spent on the 

highest-risk areas within the UASI region and that the methodology is in 

compliance with grant guidance. In addition, the SAA noted that FEMA does not 

require a particular funding allocation methodology. According to the SAA, its 

funding methodology used to award allocations to each UASI jurisdiction was 

modeled after the risk-based methodology developed by DHS to distribute funds 

nationwide. 

The SAA stated that it makes a quarterly PowerPoint presentation to the 

Homeland Security Advisory Committee to show the State’s progress on each 

objective in the State Homeland Security Strategy. To improve information flow, 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

the SAA will make a presentation to the UASI Board annually, with an overview 

of new State Agency awarded projects supported by UASI funds. 

The actions proposed by FEMA and taken by the SAA meet the intent of 

recommendation 1. If properly implemented, the actions identified in the 

responses should address the conditions identified during the audit. This 

recommendation is considered resolved and open, pending final implementation 

of the proposed corrective actions. 

The FEMA and SAA responses include positive steps for implementing 

recommendations 2 and 3. However, until FEMA provides a firm timetable for 

implementing the recommendations, these recommendations will remain 

unresolved and open. 

Oversight and Monitoring 

The SAA can improve its oversight and monitoring of its subgrantees in four 

different areas. Specifically, oversight of the project justification process needs 

to be improved to ensure that subgrantees implement only projects aligned with 

approved investment justifications. In addition, the SAA must oversee 

subgrantees to make sure they follow Federal procurement standards, as well as 

inventory and property standards, so that items are acquired and accounted for 

properly. Finally, the SAA needs to modify its subgrant agreement and 

purchasing processes to improve its timeliness in making grant funds available to 

subgrantees and expediting purchases for planned projects. 

Project Justifications 

FYs 2007–2009 grant agreements with FEMA require recipients to fund only 

projects included in the investment justifications3 submitted to DHS and 

evaluated through the peer review process. Each of the 3 grant years had 

specific investments under which approved projects were to be aligned. The 

SAA requires the subgrantees to submit project justifications that align with the 

investments. The project justifications must be submitted by the subgrantee and 

approved by the SAA prior to starting any project. 

For the subgrantees we selected (see appendix A for details), we tested 150 out 

of 499 projects (30 percent) approved by the SAA to be funded with FYs 2007– 

2009 SHSP or UASI grant funds. We reviewed quarterly reports, which included 

3

 The investment justification is the method by which States and urban areas request HSGP funding. It 

describes specific projects that will help enhance and sustain capabilities and achieve outcomes aligned 

with their respective homeland security strategies. 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

project overviews and objectives, and compared them with baseline purposes 

and descriptions, funding plans, and accomplishments included in the 

corresponding investment justifications approved by FEMA. Of the 150 SAAapproved projects, we determined that 14 project justifications were aligned 

with the wrong investment justification, and another 12 were aligned with 

multiple investment justifications. 

An SAA official said that the misalignments and multiple alignments occurred 

because the subgrantees responsible for filling out the project justification form 

were not being adequately trained on aligning projects with investments and 

documenting them properly on the form. In addition, it appeared that the SAA 

did not identify and document the discrepancy on the original project and return 

it to the subgrantee for correction, but rather approved the original document. 

According to the SAA’s standard operating procedure on DHS subgrantee project 

monitoring and reporting, the Performance and Reporting Unit is to evaluate 

project justifications for completeness, focusing on alignment with the 

investments approved for the award and objectives to be accomplished with the 

project. If projects are misaligned under the wrong investment justification, 

budgeting and reporting information could be erroneous, projects and 

equipment purchases could be duplicated, and the SAA could be submitting 

unallowable costs to FEMA. 

SAA officials acknowledged the misalignments of the project justifications. 

Although the SAA says that it is making changes to the process, including revised 

forms and improved training, issues remain with some justifications whose 

misalignment could result in unallowable costs. 

As an example, an SAA-approved project costing $517,000 purportedly aligned 

under UASI Investment #3, “Enhance Regional Fusion Capability to gather, 

analyze, and disseminate information to all sectors.” However, the project 

overview describes enhanced activities for a membership-driven law 

enforcement management information system used by police and sheriff’s 

departments. The system provides members access to information such as 

electronic citations, accident reports, fingerprints, and mug shots. The approved 

investment, which supports the establishment of a fusion center,4

 and the 

project description (law enforcement management system) do not appear to 

4

 Fusion centers are analytical and information-sharing entities that bring agencies together to assess local 

implications of threat information in order to better understand the general threat picture. These centers 

analyze information and identify trends to share timely intelligence with Federal, State, and local law 

enforcement, including DHS, which then share this information with other members of the Intelligence 

Community. 

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Department of Homeland Security 

match. This project was approved by the SAA and implemented even though it 

was not aligned with a FEMA-approved investment justification. This investment 

justification (UASI Investment #3) is unique to the fusion center and should not 

have been used as justification for any other projects. 

Recommendations 

We recommend that the Assistant Administrator, Grant Programs Directorate for 

the Federal Emergency Management Agency: 

Recommendation #4: 

Direct the SAA to improve oversight and monitoring of the subgrantees’ project 

justifications to ensure that subgrantees implement only projects included in 

FEMA-approved investment justifications, and improve subgrantee training on 

preparation of the project justification form. 

Recommendation #5: 

Review the SAA’s project justifications to determine whether they are correctly 

aligned with approved investment justifications, and if not, determine whether 

any projects result in questioned or unallowable costs. 

Management Comments and OIG Analysis 

FEMA concurred with recommendations 4 and 5. During 2011, FEMA randomly 

reviewed the SAA’s project justifications for multiple regions across the State as 

well as all project justifications from the UASI for the grant years referenced. 

Although there was evidence of some misaligned projects having been approved, 

corrections were made through Investment Justification modifications. FEMA 

reviewed the SAA’s business process for project justifications and approval and 

found that safeguards are in place to mitigate the potential for unallowable cost. 

FEMA also stated that the SAA makes available to subgrantees technical 

assistance and training for project justification preparation through SAAsponsored conferences, workshops, and on-site visits. 

In August 2012, FEMA will monitor the SAA on-site and will again review and 

verify that subgrantee projects align with FEMA-approved Investment 

Justifications and that adequate safeguards are in place. In addition, FEMA will 

review the State’s project justifications for the grant years referenced to 

determine whether they are correctly aligned with approved Investment 

Justifications and whether corrective actions are necessary to address any 

questionable or unallowable cost. 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

The SAA agreed with recommendations 4 and 5. The SAA believes that this is a 

documentation issue related to implementing a new process. According to the 

SAA, it developed and implemented the Project Justification/Allowable Cost 

Justification/Quarterly Reporting process for the FY 2007 Homeland Security 

grants. As with any new process, there is a learning curve for using and 

understanding the process. The SAA stated that it has identified the problems 

and updated the forms to facilitate accurate completion. State agencies now 

must attend mandatory training to be eligible to submit projects, and additional 

training is provided for local subgrantees at annual regional grant roll-out 

presentations and fiduciary training. According to the SAA, additional processes 

have been implemented to improve documentation of the review and approval 

of the alignment with investments. 

The SAA stated that it has submitted supplemental documentation to FEMA that 

identifies that the planned projects are correctly aligned with approved 

investments and all are allowable. It is the SAA’s understanding that FEMA has 

reviewed the supplemental information and has determined that the projects 

are aligned with an approved investment and are allowable. 

The actions proposed by FEMA and taken by the SAA meet the intent of 

recommendations 4 and 5. If properly implemented, the actions identified in the 

responses should address the conditions identified during the audit. These 

recommendations are considered resolved and open, pending final 

implementation of the proposed corrective actions. 

Federal Procurement Standards 

Although the SAA refers to procurement regulations in its grant agreements, it 

can improve its monitoring of subgrantees to ensure that they are in compliance 

with Federal procurement requirements. Specifically, we noted that several 

subgrantees did not document their procurement process and maintain 

adequate records to detail the significant history of a procurement as required in 

the Code of Federal Regulations (CFR), Title 44 §13.36. The SAA performs only a 

single onsite monitoring review of subgrantee procurement procedures during 

closeout of a grant award. 

We reviewed 38 procurement actions executed during the scope of our audit 

and found 14 instances where subgrantees awarded noncompetitive contracts 

and did not provide supporting documentation to justify their actions. Federal 

regulation 44 CFR 13.36(a) requires grantees and subgrantees to follow the same 

policies and procedures they use for procurements from non-Federal funds as 

long as they conform with applicable Federal law. For example, one subgrantee 

procured a 3-month rental of a traveling exhibition for $40,000. The subgrantee 

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 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

paid for the service before receiving adequate documentation from the vendor 

regarding the sole source procurement. There was no documentation in the 

procurement file supporting the subgrantee’s research of other vendors capable 

of presenting a similar exhibit. 

As a result of the inadequate procurement documentation, purchases made 

could be unallowable, in which case funds used for those purchases should be 

returned to FEMA. In addition, without adequate documentation and 

compliance with Federal procurement regulations, there is an increased risk of 

not receiving full benefit for the funds expended. We identified an estimated 

$1 million in unsupported costs for the noncompetitive contracts awarded, as 

shown in table 2. 

Table 2. Number of Noncompetitive Contracts and Estimated Dollar Value 

Funding 

State Homeland Security

Urban Areas Security Initiative 

Totals 

Fiscal Year 

2007 

2007

Number of 

Contracts 

8 

6 

14 

Contract 

Amount 

$679,426 

$406,228 

$1,085,654 

Source: DHS OIG. 

Recommendations 

We recommend that the Assistant Administrator, Grant Programs Directorate for 

the Federal Emergency Management Agency: 

Recommendation #6: 

Direct the SAA to improve oversight to ensure that subgrantees follow Federal 

procurement requirements. 

Recommendation #7: 

Review costs associated with noncompetitive contracts and determine whether 

the costs are allowable and properly supported. 

Management Comments and OIG Analysis 

FEMA concurred with recommendations 6 and 7. FEMA will undertake on-site 

programmatic monitoring of Homeland Security Grant funds awarded to 

Michigan for the referenced grant years. During the visit, FEMA will formally 

www.oig.dhs.gov 13 OIG-12-114 
 

 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

review the SAA’s business process and procedures for ensuring subgrantee 

compliance with Federal procurement requirements. 

Staff of FEMA’s Grant Programs Directorate, in concert with FEMA’s Region 5 

financial analyst, will review costs associated with noncompetitive contracts 

referenced in the OIG report and determine whether the costs are allowable and 

properly supported. FEMA recommends that recommendation 7 remain open 

for 90 days or until the SAA is able to substantiate the status of all unsupported 

cost findings and noncompetitive contracts referenced in the report. 

The SAA agreed with recommendations 6 and 7. According to the SAA, it strictly 

adheres to all Federal procurement policies and regulations, including Federal 

grant guidance, regarding procurement actions. The SAA notifies subgrantees of 

procurement requirements in the grant agreements, trains subgrantees during 

grant roll-out presentations, and reviews procurement procedures and 

transactions of subgrantees during on-site monitoring visits. To improve 

oversight, the SAA stated that it prepared an informational bulletin on 

procurement issues that was disseminated to all HSGP subgrantees and 

conducted additional training on procurement requirements for all HSGP 

fiduciaries. 

The SAA believes that the issue related to recommendation 7 is a documentation 

issue and not one of unallowable or questioned costs. The SAA will submit 

supplemental information to FEMA to determine that the costs are allowable 

and properly supported. 

The actions proposed by FEMA and taken by the SAA meet the intent of 

recommendation 6. If properly implemented, the actions identified in the 

responses should address the conditions identified during the audit. This 

recommendation is considered resolved and open, pending final implementation 

of the proposed corrective actions. 

The responses of FEMA and the SAA include positive steps for implementing 

recommendation 7. However, until a firm timetable for implementing the 

recommendation is provided by FEMA, this recommendation will remain 

unresolved and open. 

Federal Inventory and Property Standards 

We identified instances in which subgrantees did not consistently follow Federal 

inventory and property standards in 44 CFR 13.32. Our review of 15 subgrantees 

that had acquired equipment showed that 4 of the 15 did not have adequate 

inventory controls in place. We identified incomplete property records that did 

www.oig.dhs.gov 14 OIG-12-114 
 

Property inventory records must be maintained and must include 12 data 

elements for each item: unit cost, description, source, acquisition date, 

identification number, location, title holder, use, condition, percentage 

purchased with Federal funds, ultimate disposition date, and sales price. 

44 CFR 13.32(d)(1). 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

not include critical information such as costs, serial numbers, and location 

identifiers. We also identified situations in which equipment purchased with 

grant funds was not properly secured. 

For example, in one case a subgrantee purportedly allowed a private citizen to 

store and use a $12,000 AM/FM portable radio transmitter to broadcast traffic 

and travel information to the attendees of a community event (neighborhood 

holiday light show). According to SAA officials, the holiday light show attracts a 

large volume of vehicles, causing traffic delays along deputy-controlled routes to 

and from the neighborhood. Although the county emergency manager placed 

the transmitter at the site, the private citizen keeps the transmitter in his garage 

during the holiday season instead of its being adequately secured by the 

subgrantee. A sticker on the transmitter reads, “This piece of equipment was 

purchased with DHS grant funds.” An official with the subgrantee said that the 

citizen did not maintain the equipment, but that it was held by the local police 

department and an agreement exists between the police department and the 

citizen. However, we did not receive a copy of such an agreement in response to 

our request. 

Also, a grant-funded radio costing more than $7,500 was housed in a mobile 

command vehicle for use during emergencies to coordinate actions of police and 

fire departments. Although the vehicle was held at an airport where adequate 

controls do exist, the subgrantee assigned responsibility and control of the 

vehicle to a private citizen who is not employed by FEMA, the State of Michigan, 

or the subgrantee. The citizen maintains a set of the vehicle’s keys and drives 

the vehicle, and is currently training another private citizen to operate the 

vehicle. 

Grantees and subgrantees receiving SHSP and UASI grant funds are required to 

comply with all applicable laws, regulations, and program guidance. Also, 

grantees and subgrantees are to maintain records sufficient to detail significant 

procurement history. Federal regulation 44 CFR 13.32 establishes procedures for 

managing equipment, whether acquired in whole or in part with grant funds, and 

includes the following minimum requirements: 

www.oig.dhs.gov 15 OIG-12-114 
 

A control system must be developed to ensure adequate safeguards to 

prevent loss, damage, or theft of the property. Any loss, damage, or 

theft shall be investigated. 44 CFR 13.32(d)(3). 

 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Inaccurate, incomplete, and missing records may impede subgrantees’ ability to 

make sound management decisions regarding future equipment needs and to 

prevent potential duplicate purchases. 

Recommendation 

We recommend that the Assistant Administrator, Grant Programs Directorate for 

the Federal Emergency Management Agency: 

Recommendation #8: 

Direct the SAA to improve oversight to ensure that subgrantees follow Federal 

inventory and property requirements, and adequately secure property 

purchased with grant funds. 

Management Comments and OIG Analysis 

FEMA concurred with recommendation 8. Staff of FEMA’s Grant Programs 

Directorate, in concert with a FEMA Region 5 financial analyst, will review the 

SAA’s business process for monitoring subgrantee compliance with Federal 

inventory and property requirements, and adequately securing property 

purchased with grant funds. FEMA recommends that recommendation 8 remain 

open for 90 days or until the SAA is able to demonstrate that processes and 

protocols are in place to ensure subgrantee compliance with Federal inventory 

and property requirements. 

The SAA agreed with recommendation 8. The SAA stated that it has included 

Federal property requirements in all grant agreements between the SAA and the 

subgrantees. In addition to identifying the requirements, the grant agreement 

specifically states that the subgrantee’s responsibilities include the requirements 

to annually submit a copy of the inventory to the SAA’s Audit Unit. Additional 

training was provided to subgrantees on the inventory and property requirements 

at the grant roll-out presentations. Equipment and property are reviewed during 

on-site monitoring. To improve oversight, the SAA stated that it has redesigned 

the property inventory control forms to capture each information element in the 

Federal inventory and property requirements. 

The responses of FEMA and the SAA include positive steps for implementing 

recommendation 8. However, until FEMA provides a firm timetable for 

www.oig.dhs.gov 16 OIG-12-114 
 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

implementing the recommendation, this recommendation will remain 

unresolved and open. 

State Administrative Agency’s Approval Processes 

HSGP guidance requires each SAA to obligate at least 80 percent of the total 

grant program amount to local units of government, including identified urban 

areas, within 45 days of receipt of funds (60 days in FY 2007). 

Although the SAA allocated grant funds to subgrantees in accordance with 

Federal requirements, the funds were not available for expenditure in a timely 

manner. SAA officials indicated that subgrantees will not be eligible to receive 

reimbursement of grant funds until the SAA receives a fully executed subgrant 

agreement. 

We reviewed 43 subgrant agreements executed during FYs 2007–2009 and 

found that the SAA executed subgrant agreements an average of 348 days after 

FEMA award letters were issued. We calculated two distinct timeframes to 

come up with the number of days it took to execute the subgrantee agreement: 

first, the date from when FEMA sent the grant award letter to the SAA, and the 

SAA signed the grant agreement and sent the agreement to the subgrantees; 

and second, the time it took for the subgrantee to review the grant agreement, 

sign the agreement, and send it back to the SAA so the grant agreement could be 

executed and funds could be obligated. Figure 2 shows the average time each of 

these phases took and the total amount of time for the entire process during 

FYs 2007–2009. 

Figure 2. Average Days Between Grant Award 


and Execution of Subgrant Agreements
 

Days 

400 361 

69 307 

165 

79 

213 

292 

228 

Days Between 

Subgrant 

378 


350 


300 


250 Preparation and 

Final Signature 200 

Days Between Grant 150 Award and Subgrant 

Preparation 100 


50 


0 


FY 2007 FY 2008 FY 2009 

Source: DHS OIG. 

www.oig.dhs.gov 17 OIG-12-114 
 

 

 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Although the SAA can realistically control only the time required to prepare, sign, 

and send the grant agreement to the subgrantees for their signature, we looked 

at the entire approval process to see where the delays were occurring. For 

example, for grant years 2007–2009, one county completed its subgrant 

agreements 518, 439, and 423 days, respectively, after the SAA received the 

award letter from FEMA. For the 2007 grant agreement, the SAA held the 

agreement for 368 days, while the county did not return the signed agreement 

for 150 days. In 2008, the SAA held the grant agreement for 328 days and the 

county held it for 111 days. In 2009, the SAA held the grant agreement for 220 

days and the county held it for 203 days. 

It is evident that both the SAA and subgrantee phases have delays, and the 

entire grant agreement process needs to be expedited. The SAA’s lengthy 

process to execute a subgrant agreement restricts the subgrantees’ ability to 

plan and expend funds to complete projects. As a result, subgrantees could 

experience delays in acquiring equipment, training, and performing exercises 

they need to prepare to address catastrophic events. 

Additionally, we reviewed 58 purchase approvals and found that the time the 

SAA took to approve purchases ranged from 1 to 176 days, with an average of 41 

days. Officials from two different regions reported SAA delays as a major 

constraint in the purchase of equipment. Because the SAA does not have a 

standard or target timeframe for responding to requests for purchase approvals, 

the purchase of critical equipment could be delayed. 

Part of the reason for the delays is that, in some instances, FEMA requires 

subgrantees to comply with Environmental and Historic Preservation (EHP) 

requirements and assess projects for environmental impact, with a few 

exceptions such as training and exercises.5

 For example, on September 22, 2009, 

one subgrantee submitted a cost justification for two 911 consoles (workstations 

used by dispatchers in an emergency operation center), which was not approved 

until March 17, 2010, 176 days later. The SAA only conditionally accepted the 

cost justification pending a potential EHP review, as the project equipment 

included antennas. As a best practice, it would be beneficial for the SAA to 

remind subgrantees of the timeframes associated with EHP requirements early 

in the grant process so they can plan equipment purchase and installation. 

5

 According to the FY 2009 Homeland Security Grant Program Guidance and Application Kit, a “[r]ecipient 

shall not undertake any project having the potential to impact EHP resources without the prior approval 

of FEMA, including but not limited to communications towers, physical security enhancements, new 

construction, and modifications to buildings, ... that are at least 50 years old ... . Recipient must comply 

with all conditions placed on the project as the result of the EHP review.” 

www.oig.dhs.gov 18 OIG-12-114 
 

 

 

 

 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

The existing approval processes significantly reduce time available for 

subgrantees to make expenditures and be reimbursed by the SAA and delay 

overall expenditure of grant funds. 

Recommendation 

We recommend that the Assistant Administrator, Grant Programs Directorate for 

the Federal Emergency Management Agency: 

Recommendation #9: 

Direct the SAA to assess the current processes for executing subgrant 

agreements and purchase approvals and work with all involved parties to 

identify opportunities to expedite the processes. 

Management Comments and OIG Analysis 

FEMA concurred with recommendation 9. FEMA has reviewed with the SAA the 

timeliness of subgrantee project approvals and is satisfied that the SAA moves as 

expeditiously as the various requirements of project approval will allow. During 

the August 2012 SAA on-site monitoring, FEMA will determine the additional 

progress for moving subgrant agreements toward the required 45-day obligation. 

The SAA agreed with recommendation 9. According to the SAA, it obligates 

grant funds to subgrantees in compliance with Federal requirements of 45 or 

60 days, and notifies all subgrantee by email and conference calls of their award 

amount. The SAA stated that it has also developed the Regional Investment 

Project Projection sheet for submission by the subgrantees to begin planning for 

the expenditure and timeframe of the grant award, and to encourage the 

regions to plan strategically for upcoming grant years. In addition, the SAA 

stated that it has reviewed the grant agreement and purchase approval 

processes to indentify efficiencies; implemented a requirement for the regional 

board to identify its fiduciary at least 60 days prior to receipt of the grant award 

letter; and significantly reduced the time for sending grant agreements to 

subgrantees. 

The actions proposed by FEMA and taken by the SAA meet the intent of 

recommendation 9. If properly implemented, the actions identified in the 

responses should address the conditions identified during the audit. This 

recommendation is considered resolved and open, pending final implementation 

of the proposed corrective actions. 

www.oig.dhs.gov 19 OIG-12-114 
 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendix A 

Objectives, Scope, and Methodology 

The Department of Homeland Security (DHS) Office of Inspector General (OIG) 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. 

The audit objective was to determine whether the State of Michigan (1) spent grant 

funds effectively and efficiently, and (2) complied with applicable Federal laws and 

regulations and DHS guidelines. We also determined the extent to which funds awarded 

enhanced the ability of each grantee to prevent, prepare for, protect against, and 

respond to natural disasters, acts of terrorism, and other manmade disasters. The 

scope of the audit included the SHSP and UASI grant awards for FYs 2007–2009, as 

described in appendix C. 

The audit methodology included work at FEMA headquarters, State of Michigan offices, 

the urban area that received grants, and other subgrantee locations. We analyzed data, 

reviewed documentation, inspected equipment, and interviewed key State officials 

directly involved in the management and administration of the State of Michigan’s 

Homeland Security Grant Programs. The State of Michigan has recently implemented a 

process to measure its preparedness. However, because of the recent implementation 

of this change, we did not evaluate the new process. 

Our site visit selection was based on a judgmental sample based on combined SHSP and 

UASI grant awards for FYs 2007–2009. The top four regions and top six State agencies 

were selected for review, representing 83 percent and 90 percent of awards and 

81 percent and 92 percent of expenditures, respectively. One of the selected regions 

(Region 2) comprised the UASI, and included the City of Detroit and the six individual 

counties. We conducted site visits at the following 17 organizations: 

1. Region 1 10. Washtenaw County 

2. Region 2 11. Wayne County 

3. Region 3 12. Department of Community Health 

4. Region 6 13. Department of Military and Veterans Affairs 

5. City of Detroit 14. Department of Transportation 

6. Macomb County 15. Emergency Management and Homeland Security 

7. Monroe County 16. Michigan Department of State Police 

8. Oakland County 17. State Administrative Agency 

9. St. Clair County 

www.oig.dhs.gov 20 OIG-12-114 
 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

For our compliance test work, we selected the following samples:
 

Project Justifications – judgmentally selected 150 out of 499 projects approved 


by the SAA and funded with FYs 2007–2009 SHSP or UASI grant funds, 


Inventory and Property Standards – tested 15 out of the 17 subgrantees visited 

that acquired equipment during the scope of our review, 

Subgrant Agreements – reviewed all 43 grant agreements during the scope of 

our review for the subgrantee site visits, 

Federal Procurement Standards – reviewed 38 judgmentally selected 

procurement actions executed during the scope of our review, and 

Purchase Approvals – reviewed 58 purchase approvals. 

We conducted this performance audit between October 2010 and January 2012, 

pursuant to the Inspector General Act of 1978, as amended, and according to generally 

accepted government auditing standards. Those standards require that we plan and 

perform the audit to obtain sufficient, appropriate evidence to provide a reasonable 

basis for our findings and conclusions based upon our audit objectives. We believe that 

the evidence obtained provides a reasonable basis for our findings and conclusions 

based upon our audit objectives. 

www.oig.dhs.gov 21 OIG-12-114 
 

OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Appendix B 

Management Comments to the Draft Report 

U.S. 1>fparl lnf nl of Ilome1antl Srturil~' 

Washington. DC 20472 

8 FEMA 

JUl I 8 2012 

MEMORANDUM FOR: Anne L. Richards 

Assistant inspector General for Audits 

Office of Inspector General 

FROM: David J. Kaufman 

Director 

A/P r~ Office of Policy an Program Analysis 

SUBJECT: Comments to DIG/GAO Draft Report, The Slate of Michigan 's 

Management a/SUIte Homelalld Security Program and Urban 

Areas Security Initiative Grants Awarded During Fiscal Years 

2007 through 2009 

Thank. you for the opportunity to comment on the draft report, The State of Michigan 's 

Management a/State Homeland Security Program and Urban Areas Security Initiative (UASI) 

Crants Awarded During Fiscal Years 2007 through 2009 (project code 10-172-AVD-FEMA). 

The findings in the report will be used to strengthen the effectiveness and efficiency of how we 

execute and measure our programs. We recognize the need to continue to improve the process, 

including addressing the recommendations raised in this report. Our responses to the 

nine recommendations contained in this draft report are as follows: 

Recommendation #1: Direct the State to direct the UASI Board to establish procedures on 

oversight responsibilities over all VASl funds to ensure that all regional and local projects and 

investments are coordinated, projects are implemented, and progress is tracked. 

FEMA Response: FEMA concurs with Recommendation # 1. 

In early 2011 , language was added to the Urban Area Working Group Charter and subgrantee 

award documents to ensure meaningful local and regional coordination and collaboration of 

project activity. In September of 2012, FEMA wi!] monitor the UASI on-site and will verify that 

improvements to VASr oversight and coordination processes are being implemented with 

efficiency and effectiveness and consistent with UAS! program guidance. 

FEMA requests that the recommendation be resolved and open pending completion of the 

scheduled September 2012 on-site verificalion of improvements to VAS! processes. 

Recommendation #2: Direct the State to review the UASI funding allocation methodology to 

ensure that funds are spent on the highest.risk areas within the UASI region. 

 

www.oig.dhs.gov 22 OIG-12-114 
 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

FEMA Response: FEMA concurs with Recommendation #2. 

FEMA will review the methodology the State Administrative Agency (SAA) utilizes to allocate 

VASI funding and ensure VASI funds are spent on the highest-risk areas within the VASI 

region. 

FEMA recommends this recommendation remains open for 90 days or until such time that the 

SAA is able to demonstrate to FEMA that VASI funds are being applied proportionate to areas 

of highest risk within the VASI region. 

Recommendation #3: Direct the State to provide documentation to the UASI Board and region 

officials showing how funds retained by the State have been used to support the urban area. 

FEMA Response: FEMA concurs with Recommendation #3. 

In mid-2011, FEMA has received 'from the SAA general information of how VASI funds 

retained by the SAA for fiscal years 2007 through 2009 had been spent in support of the VASI. 

The information provided by the SAA is insufficient with respect to project detail. FEMA is 

requesting supplemental information from the SAA to ascertain funds retained by the State have 

been used in direct support of the VASI and are shared and coordinated with the VASI Board. 

FEMA recommends this recommendation remains open for 90 days or until such time that the 

SAA is able to demonstrate that programs and projects supported with VASI funds retained by 

the SAA are applied to programs and projects that directly support the Vrban Area and are 

shared and coordinated with the VASI Board. 

Recommendation #4: Direct the SAA to improve oversight and monitoring of the subgrantees' 

project justifications to ensure that subgrantees implement only projects included in 

FEMA-approved investment justifications, and improve subgrantee training on preparation of the 

project justification form. 

FEMA Response: FEMA concurs with Recommendation #4. 

During calendar year 20 II , FEMA randomly reviewed the SAA's project justifications for 

multiple Regions from across the state and reviewed every project justification that emanated 

from the VASI for the grant years referenced. While there was evidence of some projects having 

been approved that did not align with the FEMA approved Investment Justification, corrections 

were made through Investment Justification modifications. In addition, FEMA reviewed the 

SAA's business process for project justification and approval and found safeguards are in place 

to mitigate the potential for unallowable cost. FEMA is also aware that the 8AA makes available 

technical assistance and training to Michigan's subgrantees project justification preparation 

through SAA sponsored conferences, workshops and on-site visits. 

In August of2012, FEMA will monitor the SAA on-site and will again review and verify that 

subgrantee projects align with FEMA approved Investment Justifications and that adequate 

safeguards are in place to mitigate the potential for unallowable cost in the SAA's project 

justification and approval process. 

 

www.oig.dhs.gov 23 OIG-12-114 
 

OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

FEMA requests that the recommendation be resolved and open pending completion of the 

scheduled August 2012 on-site programmatic monitoring of Michigan's Homeland Security 

Grant funds. 

Recommendation #5: Review the State's project justifications to detennine whether they are 

correctly aligned with approved investment justifications, and if not, detennine whether any 

projects result in questioned or unallowable costs. 

FEMA Response: FEMA concurs with Recommendation #5. 

In August 2012, FEMA will conduct an on-site programmatic monitoring of Michigan's 

Homeland Security Grant funds. During the on-site monitoring, FEMA will review the State's 

project justifications for the grant years referenced to determine whether they are correctly 

aligned with approved Investment Justifications and if any corrective actions are necessary to 

address any questionable or Wlallowable cost. 

FEMA requests that the recommendation be resolved and open pending completion of the 

scheduled August 2012 on-site programmatic monitoring of Michigan's Homeland Security 

Grant funds. 

Recommendation #6: Direct the SAA to improve oversight to ensure that subgrantees follow 

Federal procurement requirements. 

FEMA Response: FEMA concurs with Recommendation #6. 

In August of 20 12, FEMA will undertake on-site a programmatic monitoring of Homeland 

Security Grant funds awarded to Michigan for the referenced grant years. During the August 

visit, FEMA will fonnally review the SAA's business process and procedures for ensuring subgrantee compliance with Federal procurement requirements. 

FEMA requests that the recommendation be resolved and open pending completion of the 

August 2012 on-site verification of the SAA's process and procedures relating to sub-grantee 

compliance with Federal procurement requirements. 

R«ommendation #7: Review costs associated with noncompetitive contracts and determine 

whether the costs are allowable and properly supported. 

FEMA Response: FEMA concurs with Recommendation #7. 

Staff ofFEMA's Grant Programs Directorate in concert with FEMA Region 5 financial analyst 

will review costs associated with noncompetitive contracts referenced in the OIG Report and 

detennine whether the costs are allowable and properly supported. Unsupported cost and 

noncompetitive contracts, that are found to be improperly executed, may result in reimbursement 

of Federal funds to the extent allowable by law. 

FEMA recommends this OIG recommendation remain open for 90 days or Wltil such time that 

the SAA is able to substantiate the status of all unsupported cost findings and noncompetitive 

contracts referenced in recommendation #7 of the OIG Report. 

 

www.oig.dhs.gov 24 OIG-12-114 
 

OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Recommendation #8: Direct the 8AA to improve oversight to ensure that subgrantees follow 

Federal inventory and property requirements, and adequately secure property purchased with 

grant funds. 

FEMA Response: FEMA concurs with Recommendation #8. 

8taffofFEMA's Grant Programs Directorate in concert with the FEMA Region 5 fmancial 

analyst will review the 8AA' s business process for sub-grantee monitoring as it relates to 

ensuring sub-grantee compliance with Federal inventory and property requirements, and 

adequately securing property purchased with grant funds. 

FEMA reconunends this OIG recommendation remain open for 90 days or lUltil such time that 

the SAA is able to demonstrate that processes and protocols are in place to ensuring sub-grantee 

compliance with Federal inventory and property requirements. 

Recommendation #9: Direct the 8AA to assess the current processes for executing subgrantee 

agreements and purchase approvals and work with all involved parties to identify opportunities 

to expedite the processes. 

FEMA Response: FEMA concurs with Recommendation #9. 

In FY 2011 FEMA documented that the 8AA executed sub-grantee agreements within 54 days of 

Michigan's receipt of the H8GP grant award. While this is just short of the 45 days required by 

program guidance, the 8AA continues to make progress. FEMA has also reviewed with the 8AA 

the timeliness of subgrantee project approvals and is satisfied the SAA moves as expeditiously as 

the various requirements of project approval will allow. Dwing the August 2012 SAA on-site 

monitoring, FEMA will detennine the additional progress for sub grant agreements towards the 

required 45 day obligation. 

FEMA requests that the recommendation be resolved and open pending completion of the 

scheduled August 2012 SAA monitoring visit, which should verify full compliance. 

Again, we thank you for the opportunity to review and comment on the subject draft report. 

Should you have any questions concerning our response, please feel free to contact our Acting 

Chief Audit Liaison, Gina Norton, at 202-646-4287. 

 

www.oig.dhs.gov 25 OIG-12-114 
 

OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

STATE OF MICHIGAN 

DEPARTMENT OF STATE POLICE RICK SNYDER COL. KRISTE KIBBEY ETUE 

GOVEIINOR LANSING DIRECTOR 

July 9,2012 

Mark Bell 

Deputy Assistant Inspector General for Audit 

Office of Audit 

Office of Inspector General 

Department of Homeland Security 

Washington, DC 20528 

Dear Mr. Bell: 

Attached to this letter is the official response by the Emergency Management and Homeland 

Security Division as State Administrative Agency of the Michigan State Police to the draft audit, 

The State of Michigan's Management of State Homeland Security Program and Urban Areas 

Security Initiative Grants Awarded During Fiscal Years 2007 through 2009. 

We appreciate the opportunity to respond to this audit. If you have any questions or need 

additional information, please contact me at (517) 241-0981. 

Sincerely, 

~Jt;J.d~",-< 

~CqUelirfe Reese 

Audit Manager 

Attachment 

cc Ms. Anne Richards, DHS 

Ms. Jewel Butler, DHS 

Mr. Michael Slviy, DHS 

Mr. Patrick Tobo, DHS 

Col. Kristie Kibbey Etue 

Mr. Shawn Sible 

Capt. W. Thomas Sands 

H:EMHSDIOIG HSGP 07-091Final Response Letter 

MICHIGAN STATE POLICE HEADQUARTERS . 333 SOUTH GRANO AVENUE. P.O. BOX 30634 • LANSING. MICHIGAN 48909 

www.mIchig,n.govlmsp • (517) 332-2521 

 

www.oig.dhs.gov 26 OIG-12-114 
 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Michigan State Police 

Emergency Management and Homeland Security Division (EMHSD) 

As State Administrative Agency (SM) 

Response to the Department of Homeland Security 

Office of Inspector General 

State Homeland Security Program and Urban Areas Security Initiative 

Grants Awarded During Fiscal Years 

2007 throug h 2009 

Recommendation #1 

Direct the SM to direct the UASI Board to establish procedures on oversight 

responsibilities over all UASI funds to ensure that all regional and local projects and 

investments are coordinated, projects are implemented, and progress is tracked. 

Agency Response 

The SM agrees vvith the recommendation. The SM has taken affirmative and 

deliberate steps to improve the efficiency and effectiveness of the UASI program. The 

SM directed the UASI Board to establish oversight procedures for all UASI funds to 

ensure that all investments and regional and local projects are coordinated, 

implemented, and that progress is tracked. The SM's directives were included in the 

grant agreement beginning with the FY10 HSGP award. Specific requirements included: 

a. A single point of contact between the SM and the Subgrantee. 

b. The Regional Board Vllill review and approve all projects to be funded before 

they are submitted to the Subgrantor for approval. 

c. The Regional Board Vllill ensure all grant projects align to the approved 

investments. 

d. The Subgrantee will be required to submit: reports to the Subgrantor on the 

status of all funding; updated project and allocation information; and other 

reports , as required by the Subgrantor to implement an investment-specific 

reporting process. 

Recommendation #2 

Direct the SM to review the UASI funding allocation methodology to ensure that funds 

are spent on the highest-risk areas within the UASI region. 

Agency Response 

The SM agrees vvith the recommendation. The SM has reviewed the UASI funding 

allocation methodology and believes that the methodology does ensure that funds are 

spent on the highest-risk areas Vllithin the UASI region and that the methodology is in 

compliance with grant guidance. The Homeland Security Grant Program (HSGP) 

Guidance and Application Kit does not require a particular funding allocation 

methodology. 

The SM's funding methodology used to award allocations to each UASI jurisdiction was 

modeled after the risk-based methodology developed by DHS to distribute funds 

nationwide. Each jurisdiction was awarded a baseline allocation, consistent with the 

baseline percent used by DHS in the applicable grant fiscal year, and a risk-based 

allocation. Risk is calculated as a function of threat, SARA Title III sites, critical 

 

www.oig.dhs.gov 27 OIG-12-114 
 

OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

infrastructure and key resources, population and population density. The baseline and 

risk·based aliocations, taken together, provide the jurisdictions with funding to ensure 

sustainment of capabilities throughout the urban area while concentrating the 

preponderance of available resources to those jurisdictions posed with the greatest risk . 

lastly, it is important to note that FEMA does not require a particular funding allocation 

methodology. FEMA stated in its response to the 2011 OIG Audit of The State of Texas 

SHSP program, "FEMA GPD does not mandate that grantees administer a specific 

allocation method in their subaward process, and it is therefore up to the state to 

determine the most effective method of aliocation, whether to include risk or otherwise, 

and to advise its sub recipients accordingly." 

Recommendation #3 

Direct the SM to provide documentation to the UASI Board and region officials showing 

how funds retained by the State have been used to support the urban area. 

Agency Response 

The SM agrees with the recommendation. The SM makes a quarterly pov.-er point 

presentation to the Homeland Security Advisory Committee (HSAC), which is comprised 

of Michigan's homeland security stakeholders and includes the regional board chairs. 

The presentation is done to show the state's progress on each objective in the State 

Homeland Security Strategy. Attendance at the HSAC meetings is voluntary. To better 

improve information flow, an SAA presentation to the UASI Board will be made annually 

with an overview of new State Agency awarded projects supported by UASI funds. 

Recommendation #4 

Direct the SM to improve oversight and monitoring of the subgrantees' project 

justifications to ensure that subgrantees implement only projects included in FEMAapproved investment justifications, and improve subgrantee training on preparation of 

the project justification form. 

Agency Response 

The SM agrees with the recommendation. The 8M believes that this is a 

documentation issue related to the implementation of a new process. The SM has 

identified the problems and updated the forms to facilitate accurate completion. State 

agencies now must attend mandatory training to be eligible to submit projects and 

additional training is provided for local subgrantees at annual regional grant roll-out 

presentations and fiduciary tra ining. Additional processes to improve documentation of 

the review and approval of the alignment to investments have been implemented. 

The SM did not state that alignment to multiple investments is not allowed. In fact, due 

to the nature of many investments, the likelihood that a project may align to multiple 

investments is very likely. Also, the SM acknov.1edged the documentation problem with 

misalignment of investments, not that the projects did not align to the investments. 

The SM developed and implemented the Project Justification/Allowable Cost 

Justification/Quarterly Reporting process for the FY07 Homeland Security grants for the 

purpose of: ensuring alignment with investments awarded; justifying cost allowability; 

and measuring accomplishments. As 'Nith any new process , there is a learning curve for 

use and understanding the process . Some investments, although specific to priority 

initiatives, may overlap relative to capabilities and overarching strategic goals being 

2 

 

www.oig.dhs.gov 28 OIG-12-114 
 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

addressed. At times this caused confusion for some subgrantees. Additionally , some 

projects may align to more than one investment and subgrantees did not alvvays identify 

the most appropriate investment. In some instances, 5ubgrantees requested advice in 

identifying the correct investment, but did not make the change on the form. We also 

discovered that in many instances, the personnel that attended the training INefe not the 

same personnel that completed the forms. 

This resulted in forms being completed that may not have accurately listed the correct 

investment or may have listed multiple investments. During the project review process, 

the project \MIS determined to be allowable and did align to one or more investments and 

the State Homeland Security Strategy, even thought the investment listed on the form 

may not have been the appropriate selection. 

Again, the SM has updated the forms, provided additional training and added 

processes to improve the documentation of investment alignment for project justification. 

Recommendation #5 

Reviewthe SM's project justifications to determine whether they are correctly aligned 

with approved investment justifications , and if not, determine whether any projects result 

in questioned or unallowable costs. 

Agency Response 

The SM agrees with the recommendation. The SM has submitted supplemental 

documentation to FEMA that identifies that the planned projects are correctly aligned 

with approved investments and all are allowable. It is the SM's understanding that 

FEMA has revievved the supplemental information and has determined that the projects 

are aligned to an approved investment and are allowable. 

Again, the issue identified is a documentation issue and not unallowable or questioned 

costs. Of the 150 projects reviev.ed , 14 were identified as incorrectly aligned to the 

wrong investment and 12 vvere identified as aligned to multiple investments. Due to the 

nature of many investments, the likelihood that a project may align to multiple 

investments is very likely and does not result in unallowable or questioned costs. With 

regard to incorrect alignment, during the review process, the SM determined that the 

proposed project did align to (at least) one of the approved investments even if not 

properly listed on the form. The SAA acknowtedges that the correct investment was not 

always appropriately documented, hovvever, this also does not result in unallo...vable or 

questioned costs. In the event that a proposed project did not align to any investment, 

the project was denied. The SAA has already implemented procedures to document on 

the project justification form the correct investment alignment. 

The supplemental documentation that the SAA sent to FEMA included significant 

information on the $517,000 project identified as an example in the report. In the report, 

the project description "a law enforcement management system" was described as not 

matching the investment "the establishment of a fusion center." However, this 

demonstrates a lack of understanding of both the project and the investment. The 

project directly aligns to the investment, "Enhance Regional Fusion Capability to Gather, 

Analyze and Disseminate Information to all Sectors," including the target capabilities, 

objectives and investment milestones. 

3 

 

www.oig.dhs.gov 29 OIG-12-114 
 OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

The supplemental information has been revie\oVed by FEMA and determined that the 

projects align to an approved investment and are allov.-able. 

Recommendation #6 

Direct the SM to improve oversight to ensure that subgrantees follow Federal 

procurement requirements. 

Agency Response 

The 8M agrees with the recommendation. The 8M strictly adheres to all Federal 

procurement policies and regulations, inclusive of Federal grant guidance, regarding 

procurement actions. The SAA notifies subgrantees of procurement requirements in the 

grant agreements, trains subgrantees during grant roll-out presentations, and reviews 

procurement procedures and transactions of subgrantees during on-site monitoring 

visits. In addition to identifying the requirements, the grant agreement specifically states 

that the subgrantee's responsibility includes the requirement to "Make all purchases in 

accordance with federal and state grant guidance and local purchasing policies ." 

To improve oversight, the 8M prepared an informational bulletin on procurement issues 

that was disseminated to all H8GP subgrantees and the 8M conducted additional 

training on procurement requirements to all H8GP fiduciaries , 

Recommendation #7 

Review costs associated with noncompetitive contracts and determine ......nether the costs 

are allowable and properly supported. 

Agency Response 

The SM agrees with the recommendation. Again, the SAA believes the issue identified 

is a documentation issue and not unallowable or questioned costs. The SM will submit 

supplemental information to FEMA to determine that the costs are allowable and 

properly supported . During the course of the audit, there was some miscommunication 

between the auditors and subgrantees. Several subgrantees told the SM that they 

were not aware that the documentation provided was not adequate and that they v.ould 

have provided additional information if requested. 

Recommendation #8 

Direct the SM to improve oversight to ensure that subgrantees follow Federal inventory 

and property requirements , and adequately secure property purchased with grant funds. 

Agency Response 

The SM agrees with the recommendation. The SM has included Federal property 

requirements in all grant agreements between the SM and the subgrantees. In addition 

to identifying the requirements, the grant agreement specifically states that the 

subgrantee's responsibilities include the requirements to annually submit a copy of the 

inventory to the SM's Audit Unit. Additional training was provided to subgrantees on 

the inventory and property requirements at the grant roll-out presentations. Equipment 

and property is reviewed during on-site monitoring visits, 

To improve oversight, the SM has redesigned the property inventory control forms to 

capture each information element in the federal inventory and property requirements. 

4 

 

www.oig.dhs.gov 30 OIG-12-114 
 

OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

Recommendation #9 

Direct the SM to assess the current processes for executing subgrant agreements and 

purchase approvals and w::>rk with all involved parties to identify opportunities to 

expedite the processes. 

Agency Response 

The SM agrees with the recommendation. The SM obligates grant funds to 

subgrantees in compliance with federal requirements of 45 or 60 days. The SM notifies 

all subgrantees by email and conference calls of their award amount. The SM has also 

developed the Regional Investment Project Projection (RIPP) sheet for the subgrantees 

to begin planning for the expenditure and time frame of the grant award which are 

required to be submitted to the SM. One of the purposes for this initiative is to 

encourage the regions to plan strategically for upcoming grant years. 

Different circumstances have delayed the time in which the grant agreements have been 

sent to the subgrantees. These delays include: local changes to regional board 

representation; regional board approval of fiduciaries; updating of grant agreements; 

updating of project approval and reporting requirements; updates to requirements in the 

supplemental guidance; and calculations of regional funding formulas. 

HO\Never, there are a number of factors that may affect the time for approval: 

An Environmental Historic Preservation (EHP) review by FEMA is 

required. The SAA has no control over the timeframe. 

• The date on the purchase request may be when the request was created 

but not reflect when the request was submitted to the SAA. The time 

difference between creation of the request and submittal can be 

substantial. 

Prioritization of projects funded with grants that are near the closeout date 

can temporarily delay approval of projects funded with later grant year 

funding. 

Waiting for resolution of an allowable cost determination from FEMA. 

Waiting for a response from the subgrantee to receive more detail about 

the request in order to determine allowability. 

The SAA included EHP requirements in all grant agreements betv.Jeen the SAA and the 

subgrantees. Additional training was provided to subgrantees on the EHP requirements 

at the grant roll-out presentations. In fact, at the last programmatic monitoring visit in 

2010. FEMA identified Michigan's EHP process as exemplary. 

The SAA has reviewed the grant agreement process and purchase approval process to 

identify efficiencies. The SAA has implemented a requirement for the regional board to 

identify their fiduciary at least 60 days prior to receipt of the grant award letter. The SAA 

has already significantly reduced the timing for sending grant agreements to 

subgrantees. 

5 

 

www.oig.dhs.gov 31 OIG-12-114 
 

OFFICE OF INSPECTOR GENERAL 

 Department of Homeland Security 

The average number of days betvveen the grant aVv'ard and sending the grant agreement 

to subgrantees has reduced as fotlovvs: 

Grant A'Nard Number of 

Year Days 

FY 2007 213 

FY 2008 292 

FY 2009 228 

FY 2010 128 

FY 2011 68 

The 8M has established a goal of completing the review of purchase requests within 60 

days. The 8M has also developed a purchase approval request tracking mechanism to 

identify the location of the request in the process and to identify any potential problems. 

G 

 

www.oig.dhs.gov 32 OIG-12-114 
 

 

State Homeland Security Program funds support the implementation of State 

Homeland Security Strategies to address the identified planning, organization, 

equipment, training, and exercise needs to prevent, protect against, respond to, and 

recover from acts of terrorism and other catastrophic events. 

Urban Areas Security Initiative Program funds address the unique planning, 

organization, equipment, training, and exercise needs of high-threat, high-density 

urban areas, and assist the areas in building an enhanced and sustainable capacity to 

prevent, protect against, respond to, and recover from acts of terrorism. 

Law Enforcement Terrorism Prevention Program funds provide resources to law 

enforcement and public safety communities (working with private partners) to 

support critical terrorism prevention activities, including establishing and enhancing 

fusion centers. 

Citizen Corps Program funds bring community and government leaders together to 

coordinate the involvement of community members in emergency preparedness, 

planning, mitigation, response, and recovery. 

Metropolitan Medical Response System Program funds support designated 

jurisdictions to further enhance and sustain a regionally integrated, systematic mass 

casualty incident preparedness program that enables a response during the first 

crucial hours of an incident. 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendix C 

FEMA Homeland Security Grant Program 

The Homeland Security Grant Program provides Federal funding to help State and local 

agencies enhance their capabilities to prevent, deter, respond to, and recover from 

terrorist attacks, major disasters, and other emergencies. The program encompasses 

several interrelated Federal grant programs that together fund a range of preparedness 

activities, including planning, organization, equipment purchase, training, and exercises, 

as well as management and administration cost. Depending on the fiscal year, the 

program includes some or all of the following programs: 

www.oig.dhs.gov 33 OIG-12-114 
 

Michigan Homeland Security Grant Program Awards, Fiscal Years 2007–2009 

Funded Activity FY 2007 FY 2008 FY 2009 Total 

 

State Homeland Security Program $13,670,000 $21,430,000 $20,718,500 $55,818,500 

 State Agencies $2,734,000 $4,286,000 $4,143,700 $11,163,700 

 Region 1 $2,042,938 $3,325,750 $3,214,130 $8,582,818 

 Region 2 

 Regional Funds $0 $277,375 $270,998 $548,373 

 City of Detroit $0 $189,354 $185,613 $374,967 

 Macomb County $454,742 $105,234 $102,696 $662,672 

 Monroe County $196,242 $50,938 $49,178 $296,358 

 Oakland County $643,486 $151,417 $148,218 $943,121 

 St. Clair County $310,898 $70,909 $68,862 $450,669 

 Washtenaw County $302,623 $64,044 $62,095 $428,762 

 Wayne County $0 $200,229 $196,332 $396,561 

 Region 3 $2,070,292 $3,485,750 $3,376,729 $8,932,771 

 Region 56 $1,433,851 $2,775,750 $2,685,684 $6,895,285 

 Region 6 $1,884,284 $3,895,750 $3,769,675 $9,549,709 

 Region 7 $795,587 $1,275,750 $1,222,295 $3,293,632 

 Region 8 $801,057 $1,275,750 $1,222,295 $3,299,102 

 

Urban Areas Security Initiative $14,630,000 $14,191,000 $13,481,600 $42,302,600 

 State Agencies $2,926,000 $2,838,200 $2,696,320 $8,460,520 

 Regional Funds $1,800,817 $2,838,200 $2,696,320 $7,335,337 

 City of Detroit $2,823,037 $1,937,536 $1,846,770 $6,607,343 

 Macomb County $972,509 $1,076,793 $1,021,786 $3,071,088 

 Monroe County $522,957 $521,216 $489,290 $1,533,463 

 Oakland County $1,175,037 $1,549,353 $1,474,714 $4,199,104 

 St. Clair County $712,434 $725,565 $685,150 $2,123,149 

 Washtenaw County $700,925 $655,320 $617,823 $1,974,068 

 Wayne County $2,996,284 $2,048,817 $1,953,427 $6,998,528 

 

Total $28,300,000 $35,621,000 $34,200,100 $98,121,100 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendix D 

State Homeland Security Program and Urban Areas Security 

Initiatives Funding 

6

 Michigan does not have a Region 4. 

www.oig.dhs.gov 34 OIG-12-114 
 

 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendix E 

Project/Allowable Cost Approval Process 

Source: OIG. 


www.oig.dhs.gov 35 OIG-12-114 
 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendix F 

Schedule of Monetary Findings 

Schedule of Monetary Findings 

Recommendation 

Number 

Questioned 

Costs1 

Unsupported 

Costs2 

Funds To Be 

Put to Better 

Use3 

Total 

7 $1,085,654 $1,085,654 

Totals $1,085,654 $1,085,654 

Source: OIG prepared. 

1

 Questioned costs are funds expended on projects not included in approved 

investments identified. 

2

 Unsupported costs are funds expended for goods and/or services acquired using 

noncompetitive procurements without adequate justification. 

3

 Funds to be put to better use are unexpended costs for approved projects that were 

not included in approved investments identified. 

www.oig.dhs.gov 36 OIG-12-114 
 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendix G 

Major Contributors to This Report 

Jewel Butler, Director 

Cheryl Jones, Audit Manager 

Patrick Tobo, Audit Manager 

Sandra Ward-Greer, Auditor-in-Charge 

Jeffrey Balsewicz, Program Analyst 

Marisa Coccaro, Program Analyst 

Virginia Feliciano, Auditor 

Kevin King, Independent Referencer 

Katrina Reuben-Bynes, Independent Referencer 

www.oig.dhs.gov 37 OIG-12-114 
 

 OFFICE OF INSPECTOR GENERAL 

Department of Homeland Security 

Appendix H 

Report Distribution 

Department of Homeland Security 

Secretary 

Deputy Secretary 

Chief of Staff 

Deputy Chief of Staff 

General Counsel 

Executive Secretary 

Director, GAO/OIG Liaison Office 

Assistant Secretary for Office of Policy 

Assistant Secretary for Office of Public Affairs 

Assistant Secretary for Office of Legislative Affairs 

Federal Emergency Management Agency 

Administrator 

Assistant Administrator, Grant Programs Directorate 

Federal Emergency Management Agency Audit Liaison 

Grant Programs Directorate Audit Liaison 

Office of Management and Budget 

Chief, Homeland Security Branch 

DHS OIG Budget Examiner 

Congress 

Congressional Oversight and Appropriations Committees, as appropriate 

www.oig.dhs.gov 38 OIG-12-114 
 

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at: @dhsoig. 

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