Public Assistance - Project Accounting
Last Updated: 10/11/11
The most common reason that applicable PA funding reimbursements are denied by FEMA is poor accounting. Communities need to very carefully manage their recovery projects with this in mind. FEMA guidance recommends the following steps be taken:
- Designate a person to coordinate the accumulation of records.
- Establish a separate and distinct account for recording revenue and expenditures, and a separate account for each distinct FEMA project.
- Ensure that the final claim made for each project is supported by amounts recorded in the accounting system.
- Ensure that each expenditure is recorded in the accounting books and is referenced to supporting source documentation (checks, invoices, etc.) that can be readily retrieved.
- Research insurance coverage and seek reimbursement for the maximum amount. Credit the appropriate FEMA project with that amount.
- Check with your Federal Grant Program Coordinator about the availability of funding under other federal programs (i.e., Federal Highway, Housing and Urban Development, etc.) and ensure that the final project claim does not include costs that were funded or should be funded by another federal agency.
- Ensure that materials taken from existing inventories for use under FEMA projects are documented by inventory withdrawal and usage records.
- Do not charge the regular time salary of permanent employees or seasonal employees (whose salaries are contained in annual appropriations) to FEMA debris removal and emergency protective services projects.
- Do not claim costs for items or activities for which you did not have a cash outlay.
- Ensure that claims for overtime fringe benefits are based on cost items (i.e., F.I.C.A., worker's compensation, etc.) that accrue as a result of overtime. Items such as health benefits and leave are not eligible as overtime fringe benefits.
- Ensure that expenditures claimed under the FEMA project are reasonable and necessary, are authorized under the scope of work, and directly benefit the project.
- Ensure that you document pertinent actions for contracts awarded under FEMA projects, including the rationale for the method of procurement, the basis for contractor selection, and the basis for the contract price. Remember that federal regulations prohibit cost-plus-percentage-of-cost contracts.
If you need recommendations for project managers who will be able to assist you in keeping good records, contact Rita Seto at firstname.lastname@example.org.
Downloads and Important Information
NEMRC Audit Workshop Notes
The New England Municipal Resource Center held workshops on 10/13 & 10/14 that focused on issues that might arise during an audit related to FEMA Public Assistance. The workshop featured a panel led by Ernie Saunders with guests Tom Salmon - State Auditor, Neale Lunderville - Governor Shumlin's lead on the Irene recovery efforts, Nick Cueto (Thurs) and Tim Barnett (Fri) - FEMA PA representatives, Larry Arnold - DHS OIG Audit Manager, Fred Duplessis - VT CPA (Sullivan and Powers), and RPC representatives Rita Seto and Barb Farr (for second day only). Below are notes taken from these workshops that may be useful to our communities.
NEMRCAuditWorkshopnotes1011.pdf - File Size: 706KB - Download File
Information on accountability of FEMA Public Assistance (PA) disaster funds
Audit Tips for Managing Disaster Related Project Costs - This publication, which was developed for FEMA subgrantees, that explains the audit process, cost principles, and common audit findings.
http://www.dhs.gov/xoig/assets/OIGaudittips100108.pdf - Download File
Office of Inspecter General PA Funds Video - This 10 minute video was developed by the OIG for FEMA's use, which explains to FEMA subgrantees how the PA funds are to be accounted for, and common issues we have found during audits.
http://www.fema.gov/medialibrary/media_records/3886 - Open in New Window
FEMA publications (Policy and Guidance) - Contains information from FEMA on on the PA program and debris removal activities. These are excellent sources for information on the PA programs, and on debris removal contracting and debris removal operations – especially FEMA 325 – Debris Management Guide.
http://www.fema.gov/government/grant/pa/policy.shtm - Open in New Window
Federal Requirements for Contracts for Federal Aid Roads - Municipalities with Federal Aid Highways are advised that all projects conducted with federal funding resources (even emergency funds) are subject to federal laws. The following documents are available for your information:
Buy American Requirements
BuyAmericaRequirements.pdf - File Size: 13KB - Download File
Davis Bacon Requirements
DavisBaconRequirements.pdf - File Size: 13KB - Download File
Federal Contracting Requirements Overview
FederalContractingRequirements.pdf - File Size: 18KB - Download File
Retention of Records and Audit Requirements
rrandaudits.pdf - File Size: 13KB - Download File
VTrans Guide to Federal Contracting Requirements
ContractProvisions.pdf - File Size: 2.6MB - Download File