FEMA Cerro Grande Claims
Payments Properly Processed, but Reporting Could Be Improved Gao ID: GAO-04-129 December 24, 2003The Cerro Grande Fire Assistance Act (CGFAA) mandated that GAO annually audit all claim payments made to compensate the victims of the Cerro Grande Fire in northern New Mexico. For this third report on this topic, GAO determined whether the Federal Emergency Management Agency (FEMA), which is now a part of the Emergency Preparedness and Response Directorate of the Department of Homeland Security, (1) paid fire claims in accordance with applicable guidance and (2) implemented corrective actions to address prior GAO recommendations, including determining if FEMA properly reported claim payments to the Congress.
FEMA processed and paid its claims in accordance with its policies and procedures that were established and in place at the time the claims were reviewed and processed. For the period from August 29, 2002, to June 30, 2003, FEMA approved $40 million in claims for payment, including the initial payment of most of the subrogation claims made by insurance companies. In response to GAO's May 2003 report, FEMA established processes to address GAO's recommendations related to reconciling claimed amounts approved with actual amounts paid. These processes included comparing the individual amounts approved for payment to the amounts actually paid from inception through June 30, 2003, by claim, as well as performing complete reconciliations of total amounts that were approved and paid for the same period and as of August 31, 2003. In addition, in our prior report, we noted that FEMA improperly reported unreconciled claim amounts approved for payment as amounts actually paid. In its 2003 annual report, FEMA properly identified claimed amounts as approved amounts for payment rather than actual amounts paid in a schedule that was included in its annual report to the Congress. However, FEMA no longer provided summary information on amounts claimed, amounts approved, and its remaining estimated liabilities in its report to the Congress and did not include any information on claims paid as is required by CGFAA. Without this information, the report is less useful to the Congress and other stakeholders.
RecommendationsOur recommendations from this work are listed below with a Contact for more information. Status will change from "In process" to "Open," "Closed - implemented," or "Closed - not implemented" based on our follow up work.
Director: Team: Phone:GAO-04-129, FEMA Cerro Grande Claims: Payments Properly Processed, but Reporting Could Be Improved
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Report to the Committee on Appropriations, U.S. Senate, and the
Committee on Appropriations, House of Representatives:
December 2003:
FEMA CERRO GRANDE CLAIMS:
Payments Properly Processed, but Reporting Could Be Improved:
GAO-04-129:
GAO Highlights:
Highlights of GAO-04-129, a report to the Committee on
Appropriations, U.S. Senate, and the Committee on Appropriations,
House of Representatives
Why GAO Did This Study:
The Cerro Grande Fire Assistance Act (CGFAA) mandated that GAO
annually audit all claim payments made to compensate the victims of
the Cerro Grande Fire in northern New Mexico. For this third report on
this topic, GAO determined whether the Federal Emergency Management
Agency (FEMA), which is now a part of the Emergency Preparedness and
Response Directorate of the Department of Homeland Security, (1) paid
fire claims in accordance with applicable guidance and (2)
implemented corrective actions to address prior GAO recommendations,
including determining if FEMA properly reported claim payments to the
Congress.
What GAO Found:
FEMA processed and paid its claims in accordance with its policies
and procedures that were established and in place at the time the
claims were reviewed and processed. For the period from August 29,
2002, to June 30, 2003, FEMA approved $40 million in claims for
payment, including the initial payment of most of the subrogation
claims made by insurance companies.
In response to GAO‘s May 2003 report, FEMA established processes to
address GAO‘s recommendations related to reconciling claimed amounts
approved with actual amounts paid. These processes included comparing
the individual amounts approved for payment to the amounts actually
paid from inception through June 30, 2003, by claim, as well as
performing complete reconciliations of total amounts that were
approved and paid for the same period and as of August 31, 2003. In
addition, in our prior report, we noted that FEMA improperly reported
unreconciled claim amounts approved for payment as amounts actually
paid. In its 2003 annual report, FEMA properly identified claimed
amounts as approved amounts for payment rather than actual amounts
paid in a schedule that was included in its annual report to the
Congress. However, FEMA no longer provided summary information on
amounts claimed, amounts approved, and its remaining estimated
liabilities in its report to the Congress and did not include any
information on claims paid as is required by CGFAA. Without this
information, the report is less useful to the Congress and other
stakeholders.
What GAO Recommends:
To help FEMA improve the usefulness of its reports to the Congress,
GAO recommends that the Secretary of Homeland Security require the
Emergency Preparedness and Response Directorate to include summary
information on amounts claimed, approved, and paid and remaining
estimated program liabilities in its annual report to the Congress.
The Department of Homeland Security‘s Emergency Preparedness and
Response Directorate concurred with our recommendation to include the
summary-level information in its next annual report.
www.gao.gov/cgi-bin/getrpt?GAO-04-129.
To view the full product, including the scope and methodology, click
on the link above. For more information, contact Linda M. Calbom at
(202) 512-9508 or calboml@gao.gov.
[End of section]
Contents:
Letter:
Results in Brief:
Background:
Scope and Methodology:
Policies and Procedures for Claim Processing Were Followed:
Progress Made in Addressing Prior Recommendations, but Reporting Could
Be Improved:
Conclusions:
Recommendation for Executive Action:
Agency Comments:
Appendixes:
Appendix I: Comments from the Department of Homeland Security:
Table:
Table 1: Summary of CGFAA Approved and Estimated Claims to Be Paid as
of September 9, 2003:
Letter December 24, 2003:
The Honorable Ted Stevens:
Chairman:
The Honorable Robert C. Byrd:
Ranking Minority Member:
Committee on Appropriations:
United States Senate:
The Honorable C.W. Bill Young:
Chairman:
The Honorable David R. Obey:
Ranking Minority Member:
Committee on Appropriations:
House of Representatives:
On July 13, 2000, the President signed into law the Cerro Grande Fire
Assistance Act (CGFAA).[Footnote 1] CGFAA established the Office of
Cerro Grande Fire Claims (OCGFC) and directed the Federal Emergency
Management Agency (FEMA)[Footnote 2] to expeditiously investigate
claims, determine damages, and compensate the victims of the Cerro
Grande fire in northern New Mexico. CGFAA also requires FEMA to submit
an annual report to the Congress by August 28 that provides information
on claims submitted and amounts paid during the year. CGFAA, as
amended,[Footnote 3] requires that we audit all claim payments made
under the act, including subrogation claims[Footnote 4] made by
insurance companies, and report the results of our audit within 120
days of the issuance of FEMA's annual report. In this our third report
under CGFAA, we determined whether FEMA (1) paid fire claims in
accordance with applicable policies and procedures and (2) implemented
corrective actions to address our prior report's recommendations,
including determining if FEMA properly reported claim payments to the
Congress.
Results in Brief:
Based on the results of our statistical testing, FEMA processed and
paid its claims in accordance with its policies and procedures that
were established and in place at the time the claims were reviewed and
processed. These procedures included obtaining and reviewing proper
documentation of claims, approvals, and release forms. For the period
from August 29, 2002, through June 30, 2003, FEMA approved $40 million
in claims for payment, including the initial payment of subrogation
claims.
FEMA addressed our prior recommendations related to reconciling claimed
amounts approved with actual amounts paid. In response to our May 2003
report,[Footnote 5] FEMA compared the amounts approved for payment to
the amounts actually paid for each claim from inception through June
30, 2003. It also performed complete reconciliations of total amounts
approved and paid through the same period and as of August 31, 2003. In
addition, in our prior report, we noted that FEMA improperly reported
unreconciled claim amounts approved for payment as amounts actually
paid. In its 2003 annual report, FEMA properly identified claimed
amounts as approved amounts for payment rather than actual amounts paid
in a schedule that was included in its annual report to the Congress.
However, FEMA no longer summarized the amounts claimed, amounts
approved, and the remaining program liabilities in its report to the
Congress and did not include any information on claims paid as is
required by CGFAA. Without this information, the report is less useful
to the Congress and other stakeholders.
We are making a recommendation that addresses this reporting issue. In
commenting on a draft of the report, the Director of the Recovery
Division of the Department of Homeland Security's Emergency
Preparedness and Response Directorate agreed with our recommendation to
include the summary-level information in its next annual report.
Background:
On May 4, 2000, the National Park Service initiated a prescribed burn
on federal land at Bandelier National Monument, New Mexico, in an
effort to reduce the threat of wildfires in the area. The plan was to
burn up to 900 acres. On May 5, 2000, the prescribed burn exceeded the
capabilities of the National Park Service, spread to other federal and
nonfederal land, and was characterized as a wildfire. On May 13, 2000,
the President issued a major disaster declaration, and subsequently,
the Secretary of the Interior and the National Park Service assumed
responsibility for the fire and the loss of federal, state, local,
tribal, and private property. The fire, known as the Cerro Grande fire,
burned approximately 48,000 acres in four counties and two Indian
pueblos, destroyed over 200 residential structures, and forced the
evacuation of more than 18,000 residents.
On July 13, 2000, the President signed CGFAA into law. Under CGFAA,
each claimant is entitled to be compensated by the United States
government for certain injuries and damages that resulted from the
Cerro Grande fire. CGFAA required that FEMA promulgate and publish
implementing regulations for the Cerro Grande program within 45 days of
enactment of the law. On August 28, 2000, FEMA published Disaster
Assistance: Cerro Grande Fire Assistance: Interim Final Rule in the
Federal Register (Interim Rule).[Footnote 6] FEMA modified the Interim
Rule with a set of implementing policies and procedures on November 13,
2000. FEMA updated these policies and procedures in January and March
2001. After reviewing public comments on the Interim Rule, FEMA
finalized and published Disaster Assistance: Cerro Grande Fire
Assistance Final Rule (Final Rule) on March 21, 2001.[Footnote 7]
The Congress initially appropriated $455 million to FEMA for the
payment of such claims and $45 million for the administration of the
Cerro Grande program.[Footnote 8] In March 2002, FEMA requested, but
did not receive, additional appropriated funding of $80 million to
cover additional claims and administrative costs. In December 2002,
FEMA revised its estimate and requested additional appropriated funding
of $155 million, including $5 million for administrative costs. The
revised estimate was based on more complete claim information since the
final date to submit claims had passed on August 28, 2002. In February
2003, FEMA was appropriated an additional $90 million, of which up to
$5 million may be made available for:
:
administrative purposes.[Footnote 9] FEMA stated that only $2 million
was used in fiscal year 2003 for administrative purposes. In October
2003, FEMA received an additional appropriation of $38.062 million, of
which 5 percent may be made available for administrative
costs.[Footnote 10] After FEMA allocated a specific amount for
administrative costs, it had a maximum of $578.6 million available for
the payment of claims under CGFAA. During the audit, FEMA provided
revised claim data that reflected the amounts shown in table 1.
Table 1: Summary of CGFAA Approved and Estimated Claims to Be Paid as
of September 9, 2003:
Dollars in thousands:
Amounts approved for payment from inception; $505,698.
Estimated additional liabilities:
Pending claims; 3,705.
Appeals; 12,973.
Mitigation; 1,138.
Projected liabilities; 9,339.
Subrogation claims--approved but unpaid; 1,634.
Subrogation claims--unapproved amounts; 53,160.
Total estimated additional liabilities; $81,949.
Total actual and estimated claims to be paid; $587,647.
Source: FEMA OCGFC.
[End of table]
The claimed amounts that FEMA approved for payment through September 9,
2003, included $51.5 million of approved subrogation claims. Pending
claims included expected payments for individual, business,
governmental, and pueblo claims, and projected liabilities consisted of
potential future appeals, potential arbitrations, and contingency for
judicial review.
CGFAA requires that FEMA submit an annual report to the Congress that
provides information about claims submitted under the act. This annual
report is to include the amounts claimed, a description of the nature
of the claims, and the status or disposition of the claims, including
the amounts paid. FEMA's report is to be issued annually by August 28.
CGFAA, as amended, requires that we conduct annual audits on the
payment of all claims made and report the results of the audits to the
Congress within 120 days of FEMA's issuance of its annual report. The
act also requires that our report include a review of all subrogation
claims for which insurance companies have been paid. In May 2003, we
issued our second report on the audit of Cerro Grande claim payments
made from inception through August 28, 2002. The report stated that
FEMA properly processed and paid claims but overstated amounts paid in
its report to the Congress and made two recommendations regarding the
reconciliation of the approved and paid amounts in its payment approval
and accounting systems.[Footnote 11] FEMA issued its most recent annual
report on August 28, 2003, with claim amounts approved for payment
through June 30, 2003.
Scope and Methodology:
In performing our review, we considered the Standards for Internal
Control in the Federal Government.[Footnote 12] To reaffirm our
understanding of the claim review and payment process established by
OCGFC and to follow up on the changes made to this process since our
last report, we interviewed FEMA officials and analyzed data used in
FEMA's annual report to the Congress and data used by FEMA to determine
the estimated claim liability. We also reviewed the following:
* the requirements of CGFAA;
* the final regulations published in the Federal Register;
* FEMA's policies and procedures manual;
* a summary of FEMA's unpaid claim liability estimates as of September
9, 2003;
* FEMA's fiscal year 2002 audited financial statements; and:
* the fiscal year 2003 approvals, payments, and other documentation
concerning the Cerro Grande program and submitted claims.
Finally, we selected a statistical sample from the population of all
partial and final claimed amounts approved for payment from August 28,
2002, through June 30, 2003, to determine whether FEMA processed,
approved, and paid the Cerro Grande fire claims in accordance with its
applicable policies and procedures.
We selected a dollar unit (statistical) sample of 99 intervals
representing 84 claims totaling $21,000,928 that were approved for
payment from a population of 1,868 reported partial and final claim
amounts that had been approved for payment from August 28, 2002,
through June 30, 2003 (FEMA's cutoff date for the annual report to the
Congress), to test specific control activities, such as adequacy of
supporting documentation, evidence of claims manager and approving
official review, and actual payment by FEMA. We obtained and reviewed
related supporting documentation for the approved claim payments that
were selected from OCGFC's payment approval system.
In order to follow up on FEMA's corrective actions to address our prior
year recommendations, as well as determine whether FEMA properly
reported claim payment information to the Congress, we reviewed OCGFC's
reconciliations of claimed amounts that were approved by OCGFC for
payment from its payment approval system and the actual claim payments
made by FEMA's Disaster Finance Center (DFC) and reported in FEMA's
accounting system.
Our work was conducted in Denton, Texas,[Footnote 13] and Washington,
D.C., from September 2003 through October 2003 in accordance with
generally accepted government auditing standards. We requested agency
comments on a draft of this report from the Under Secretary of the
Department of Homeland Security's Emergency Preparedness and Response
Directorate or his designee. The Director of the Recovery Division of
the Department of Homeland Security's Emergency Preparedness and
Response Directorate provided written comments on our draft, which are
reprinted in appendix I. We discuss the written comments in the "Agency
Comments and Our Evaluation" section of this report.
Policies and Procedures for Claim Processing Were Followed:
Based on the results of our statistical testing, FEMA processed,
approved, and paid its claims in accordance with its guidelines that
were established and in place at the time the claims were reviewed and
processed. FEMA's guidelines for the approval and payment of claims
specify the following steps.
* An injured party submits a Notice of Loss (NOL)[Footnote 14] to OCGFC
to initiate the claim payment process.
* Upon receipt of the NOL, a claim reviewer contacts the claimant to
discuss the claim, explain the claims process, and determine the best
means to substantiate the loss or damages.
* The claim reviewer then assigns a claim number and enters the
information into OCGFC's claim-processing database, the Automated Claim
Information System, and begins the process of verifying the victim's
claim.
* Upon completion of its review, the claim reviewer prepares a claim
payment recommendation package, which specifies that a claimant's
injuries or damages occurred as a result of the Cerro Grande fire and
that claimed amounts are eligible for compensation under CGFAA.
* The claim reviewer also inputs reserve amounts equal to the total
claimed amounts that he/she expects to be paid into the claim-
processing database.
* A claim supervisor reviews to ensure that a proper investigation of
the claim occurred and that the proper documentation exists, among
other things, and approves each recommendation package.
* Upon approval of the claim payment recommendation package, an
Approval for Payment form is completed and sent to an OCGFC authorizing
official for review and approval.
* The Comptroller receives a Schedule of Payments, consisting of
amounts approved for payment, and reviews a sample of requested and
approved payments.
* The Comptroller then approves the Schedule of Payments, records the
approved amounts in OCGFC's payment approval system, and sends the
schedules to FEMA's DFC for additional manual processing.
* FEMA records all payments in its accounting system, the Integrated
Financial Management Information System, which is not linked to OCGFC's
payment approval system, before funds are disbursed by Treasury.
In addition to the above steps from the claim review process, which is
used for both partial payments[Footnote 15] and final payments, the
claim reviewer prepares a Proof of Loss (POL) form prior to processing
a final payment. This form summarizes all amounts recommended for
payment, including those amounts previously paid through a partial
payment. The POL form must be signed by the claimant subject to the
provisions of 18 U.S.C. §1001, which establishes criminal penalties for
false statements. Once a signed POL form is received, an OCGFC
authorized official sends a Letter of Final Determination to tell the
claimant the total amount of compensation being offered under CGFAA.
Accompanying this letter is a Release and Certification form that the
claimant signs if he or she accepts the OCGFC compensation
determination, thereby releasing the federal government from any
additional claims arising from the Cerro Grande fire.[Footnote 16] Upon
receipt of the signed Release and Certification form, FEMA processes
and mails a claimant's final payment.
Our review of the statistically selected sample of approved claims
determined that the above steps were performed in accordance with
FEMA's established approval and payment process. For the period from
August 29, 2002, through June 30, 2003, FEMA approved claims in the
amount of $40 million for payment,[Footnote 17] including the partial
payment of approved subrogation claims filed by insurance companies.
Progress Made in Addressing Prior Recommendations, but Reporting Could
Be Improved:
FEMA addressed our prior recommendations related to reconciling the
reported amounts approved for payment to amounts actually paid. FEMA
reconciled the total amounts approved for payment to the amounts
actually paid as of June 30, 2003, which was the cutoff date for its
annual report, and as of August 31, 2003. FEMA officials stated they
would continue to perform these reconciliations periodically. In
reviewing FEMA's annual report to the Congress required by CGFAA, we
found that while improvements were made in how FEMA represented the
detailed claim information in its report, claim information was no
longer summarized in the report, making it less useful and transparent.
In our May 2003 report, we recommended that FEMA reconcile the amounts
approved for payment in its payment approval system to amounts actually
paid in its accounting system and correct all identified errors in its
payment approval system. We also recommended that FEMA perform monthly
reconciliations of the approved and paid amounts for as long as both
systems are used to track and report paid amounts or request additional
funding.
In response to our recommendations, OCGFC implemented a detailed
process that consisted of compiling the claimed amounts by individual
claims from both the accounting system and the payment approval system
and matching the amounts approved and paid for each claim. It also
performed an overall reconciliation of the total amounts approved and
paid through June 30, 2003.
In performing the detailed matching process, OCGFC compared the
individual claim approval data and claim payment data from August 28,
2000, through February 19, 2003, and performed periodic comparisons of
individual claims from February 20, 2003, to May 31, 2003, and from
June 1 to June 30, 2003. When OCGFC identified differences between
amounts reported as paid by FEMA's accounting system and OCGFC's
payment approval system, it recorded the adjustments and corrections
into its payment approval system to eliminate duplication and made note
of data entry errors, which did not require adjustments. The identified
differences generally consisted of the following:
* Duplicate approved amounts that represented a claimed amount that was
approved for payment more than once. For example, in one case OCGFC
approved a final payment of $934,802. Since the claimant appealed, the
amount was not paid. While the claim was being appealed, OCGFC approved
a partial payment of $919,802. Both of these amounts appeared as
approved payments in its payment approval system. After we brought this
duplicate approval to OCGFC's attention during our prior review, it
subsequently removed the original unpaid amount from its system during
its claims comparison process later in fiscal year 2003.
* Data entry errors by claim reviewers when entering data into the
payment approval or accounting systems. For example, if an incorrect
identification number was used to process a payment, no comparison
could be made between the approved amount recorded by claim number in
the approval system and the paid amount recorded by claimant's
identification number in the accounting system. To resolve the
situation, OCGFC listed the approved amount as an unmatched item until
it located the matching payment that was recorded to a different
identification number.
In addition to these comparisons of individual claim amounts, FEMA's
Financial and Acquisition Management Division (FAMD) performed a
complete reconciliation of the total amounts that were approved for
payment and paid as of June 30, 2003. We reviewed this overall
reconciliation of the total claim amounts approved and paid under
CGFAA, from inception through June 30, 2003, and found that all
corrections and adjustments identified during OCGFC's comparison were
made. FAMD also performed a similar reconciliation of total approved
and paid amounts through August 31, 2003, and stated that it plans to
perform this overall reconciliation more regularly, at least quarterly.
In our prior report, we noted that FEMA improperly reported
unreconciled amounts that were approved for payment in its prior annual
reports to the Congress as amounts actually paid. In its 2003 annual
report to the Congress, FEMA continued to include claimed amounts
approved for payment in a detailed schedule of claim information, but
it properly identified the amounts as such instead of as paid or
expended amounts. However, FEMA's report no longer summarized
information on the amounts claimed, amounts approved, and the estimated
liabilities for the remainder of the program. In addition, FEMA did not
include any information on claims paid as is required under CGFAA.
Without this information, FEMA's annual report is less useful to the
Congress and other stakeholders.
Conclusions:
FEMA strengthened its internal controls over its claim approvals and
payments by implementing a process to reconcile its detailed approval
information to its payment information. This helps improve the accuracy
of claims information included in its systems and reports to the
Congress. The usefulness and transparency of the report would be
further improved if it included summary claim activity information.
Recommendation for Executive Action:
We recommend that the Secretary of Homeland Security direct the Under
Secretary of the Emergency Preparedness and Response Directorate to
include summary-level claim information in its annual report to the
Congress, including amounts claimed, approved, and paid and remaining
estimated program liabilities.
Agency Comments:
FEMA, in a letter from the Director of the Recovery Division of the
Department of Homeland Security's Emergency Preparedness and Response
Directorate, agreed with our recommendation to include summary-level
claim information on amounts claimed, approved, and paid and remaining
estimated program liabilities, if any, in its next annual report to the
Congress. The Department of Homeland Security's comments are reprinted
in appendix I.
:
We are sending copies of this report to the congressional committees
and subcommittees responsible for issues related to FEMA and the
Department of Homeland Security, the Secretary of the Department of
Homeland Security, the Under Secretary of the Department of Homeland
Security's Emergency Preparedness and Response Directorate, and the
Inspector General of the Department of Homeland Security. Copies will
also be made available to others upon request. In addition, this report
is available at no charge on GAO's Web site at [Hyperlink, http://
www.gao.gov.] http://www.gao.gov.
If you have any questions about this report, please contact me at (202)
512-9508 or Steven Haughton, Assistant Director, at (202) 512-5999. The
other key contributors to this assignment were Christine Fant and
Estelle Tsay.
Linda M. Calbom:
Director, Financial Management and Assurance:
Signed by Linda M. Calbom:
[End of section]
Appendixes:
Appendix I: Comments from the Department of Homeland Security:
Department of Homeland Security
500 C Street, SW:
FEMA:
Washington, DC 20472 2047:
DEC 19 2003:
Ms, Linda M. Calbom:
Director, Financial Management and Assurance Office
United States General Accounting Office:
441 G Street, N. W. 5th Floor:
Washington, D.C. 20548:
Dear Ms. Calbom:
Thank you for forwarding the draft General Accounting Office (GAO)
report entitled "FEMA Cerro Grande Claims Payments Properly Processed,
but Reporting Could be Improved." (GAO-04-129). We are gratified to
note your determination that the Office of Cerro Grande Fire Claims
("the Office") has successfully implemented recommendations from the
previous GAO report (GAO-03-623) and that we have completed
reconciliations of amounts approved for payment in our Payment Approval
System (PAS) to amounts actually paid in FEMA's accounting system from
program inception on August 28, 2000, to August 31, 2003.
As noted in your report, we have strengthened our periodic
reconciliations at the claims level by collaborating with FEMA's
Financial and Acquisition Management Division (FAMD) to coordinate
overall reconciliation. We have agreed to complete these overall
reconciliations on a quarterly basis for the duration of the Office's
activities. We were also gratified that your examination of 99
intervals representing 84 claims totaling $21,000,928 approved for
payment from August 28, 2002 through June 30, 2003 revealed no
discrepancies.
We concur with the recommendation in your draft report that we include
in future reports to Congress summary information on amounts approved
and paid, as well as remaining estimated program liabilities. We agree
that providing information relating to each o^ these categories of
information will more effectively facilitate an understanding of the
financial status of the Office's operations, so we will include such
information in future reports.
We sincerely appreciate the cooperation you and your staff have
demonstrated as we have worked together in examination of Cerro Grande
claims processing, approval and payment procedures. We are also pleased
your report acknowledges the improvements we made during fiscal year
2003. We believe our compliance with your recommendations has
strengthened our program. Thank you again for all the assistance you
and your staff have provided.
Sincerely,
Daniel A. Craig:
Director
Recovery Division Emergency Preparedness and Response:
Signed by Daniel A. Craig:
www.fema.gov:
[End of section]
(190109):
FOOTNOTES
[1] Pub. L. No. 106-246, Div. C, Title I, 114 Stat. 511, 583 (2000).
[2] As of March 2003, FEMA became part of the Emergency Preparedness
and Response Directorate of the Department of Homeland Security.
[3] Pub. L. No. 107-73, Title IV, § 428, 115 Stat. 651, 697 (2001).
[4] A subrogation claim is the right of one who has paid an obligation
that another should have paid to be indemnified by the other. In this
case, insurance companies and possibly others paid claims that the
federal government is responsible for paying.
[5] U.S. General Accounting Office, FEMA Cerro Grande Claims: Payments
Properly Processed, but Reported Payments Somewhat Overstated, GAO-03-
623 (Washington, D.C.: May 8, 2003).
[6] 65 Fed. Reg. 52260, 44 C.F.R. Part 295 (2000).
[7] 66 Fed. Reg. 15948, 44 C.F.R. Part 295 (2001).
[8] CGFAA, Sec. 105, 114 Stat. 590.
[9] Departments of Veterans Affairs and Housing and Urban Development,
and Independent Agencies Appropriations Act, 2003, Pub. L. No. 108-7,
Div. K, Title III, 117 Stat. 474, 516.
[10] Department of Homeland Security Appropriations Act, 2004, Pub. L.
No. 108-90, Title III, 117 Stat. 1137, 1150 (2003).
[11] GAO-03-623.
[12] U.S. General Accounting Office, Standards for Internal Control in
the Federal Government, GAO/AIMD-00-21.3.1 (Washington, D.C.: November
1999).
[13] In December 2002, OCGFC closed its headquarters operations in
Santa Fe, New Mexico, and moved the remaining claims operations to
FEMA's National Processing Center in Denton, Texas.
[14] The NOL describes in general terms the types of injury, damages,
or both a claimant has incurred as a result of the fire.
[15] In order to get assistance to fire survivors as soon as possible,
CGFAA allows for claimants to receive partial payments before the start
of the rebuilding process. Partial payments may be based upon actual
receipts or estimates. Final payments are made only after the entire
claim review process is completed.
[16] Under certain circumstances, claims may be reopened
notwithstanding the submission of a Release and Certification form
pursuant to 44 C.F.R. Sec. 295.34 (2002).
[17] From inception of CGFAA through June 30, 2003, FEMA reported a
total of $462 million in claims approved for payment.
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