FEMA Is Spending Billions, and Some Questionable Companies Are Getting Work
A surge in disaster contracts from hurricanes has put the agency under pressure to bypass the usual competitive bidding process.
Federal watchdogs have warned FEMA about situations like this. In 2015 the U.S. Government Accountability Office found the agency still hadn’t fully implemented changes to its contracting process that were legislated by Congress after Hurricane Katrina. It cited FEMA’s “risk of developing gaps in contract oversight during major disasters.” Kirstjen Nielsen, President Trump’s nominee to head the Department of Homeland Security, was George W. Bush’s head of the Homeland Security Council Prevention, Preparedness and Response directorate. That body was “at the apex of the policy coordination framework for responding to Hurricane Katrina,” according to the 2006 Katrina postmortem by a congressional commission.
One risk is that contractors with questionable track records get taxpayer money again. Since Harvey, FEMA has awarded $215 million to a company called Composite Analysis Group Inc. to provide bottled water. According to a federal contractor database, Composite Analysis is also called Lipsey Mountain Spring Water Inc., which got $81 million in 2005 for services that included providing bottled water to areas hit by Hurricane Katrina. Lipsey missed at least 9 of 14 deadlines, failed to document its orders properly, submitted “improper or inaccurate documentation,” and was paid $881,000 in unsupported costs, the U.S. Department of Defense’s inspector general later concluded. Composite Analysis didn’t respond to a request for comment. FEMA declined to answer questions about its vetting of the company.
LIPSEY MOUNTAIN SPRING WATER