The Federal Emergency Management Agency's Use of Civil Defense Funds

In response to a congressional request, testimony was given on the results of GAO work concerning the Federal Emergency Management Agency's (FEMA) use of civil defense funds. GAO found that FEMA has control procedures to ensure that civil defense funds are spent for civil-defense-related activities but found some exceptions to those procedures. FEMA does not yet have a system to accurately identify the amount of time which FEMA personnel spend in civil defense activities. GAO, FEMA, and Congress have previously identified a number of internal control problems which relate directly to civil defense expenditures, including: (1) an inadequate funds disbursement operation; (2) an inadequate system to ensure that appropriations are used as Congress intended; and (3) an inadequate mechanism to prevent overspending appropriations. However, FEMA has acknowledged the problems and has implemented procedures to address them. GAO believes that the new controls, if properly implemented, should provide reasonable assurance that contracts issued to private concerns are adequately reviewed and monitored; however, FEMA has not yet revised its procurement policies and procedures to comply with the Competition in Contracting Act. In addition, GAO found abuses involving sole-source contracts. Some of the problems which GAO has noted are caused by FEMA budget line items which often intertwine and are mutually supportive, often making the distinction between civil defense funds and other program funds judgmental and unclear. Approximately one-fifth of the funds designated for civil defense research in fiscal year 1984 appeared to relate primarily to program activities other than civil defense. GAO also found that controls over reprogramming and reallocating funds are in accordance with congressional requirements.