In the history of American natural disasters, the Hurricane Katrina is notorious for being one of the worst. Its origins lay is an August 2005, tropical storm that became more and more virulent in its sojourn and crashed onto the United States coast line. On the 29th of August, 2005 this hurricane smashed onto the Gulf Coast causing untold damage to all that came in its way. The brunt of the storm was borne by the city of New Orleans and around 1,300 people lost their lives (The Federal Response to Hurricane Katrina: Lessons Learned, 2006).
The magnitude of the disaster can be gauged from the fact that the federal government has allocated nearly $120 billion to fund the relief, recovery and reconstruction needs of the hurricane victims (GAO (GAO-06-714T), 2006).
Action initiated by FEMA.
In order to respond to the devastation caused by the Hurricane Katrina, the Federal Emergency Management Agency or FEMA has allotted tasks and mission assignments to 57 federal agencies and programs (President’s Council on Integrity and Efficiency, 2005). Some of these are the Army Corps of Engineers (ACE), NASA and the Department of Health and Human Services (HHS). A definite role allocation has been done for these entities as is evinced in the National Response Plan (National Response Plan, n.d).
Although, the FEMA was primarily responsible for dealing with this onslaught, there exist other federal agencies which have to share the blame for the dismal relief efforts. It is the duty of the FEMA to protect life and property. Moreover, this objective is to be achieved by enforcing the Stafford Act (Congressional Research Service Report, 2005).
However, the fact remains that it is very much possible to provide better relief and recovery services than what has been FEMA’s contribution in respect of the damage caused by the Hurricane Katrina. When damage had occurred due to a flood in Massachusetts, the FEMA had advised the residents who had suffered damage, through its emergency management officials to hire contractors only when they were reliable, licensed, had verifiable references and many more such cautionary and precautionary pieces of advise, which were sensible and pragmatic (FEMA Report, n.d). Ironically, by ignoring its own advice FEMA committed several avoidable blunders during the federal response to Hurricane Katrina. This reminds one of the apt adages, “Physician, heal thyself.”(The Holy Bible)
Reports Regarding Hurricane Katrina
Several reports have been released in this context some of these are, Hurricane Katrina: A Nation Still Unprepared, by The Senate Committee on Homeland Security and Governmental Affairs, which examines the nation’s emergency preparedness and response system; Waste, Fraud, and Abuse in Hurricane Katrina Contracts, by The House Government Reform Committee Minority staff (United States House Of Representatives Committee On Government Reform — Minority Staff Special Investigations Division, 2006); and The Federal Response to Hurricane Katrina: Lessons Learned, which is an all inclusive report released by The White House.
Shortcomings in the Government’s Response
The federal government’s response to Hurricane Katrina has revealed the existence of a number of shortcomings in the federal government’s contracting system. These drawbacks have resulted in disproportionate no-bid contracts, irrational prices and costs and dubious expenses resulting in hurricane and other disaster victims not obtaining the required assistance during a catastrophe. Moreover, the taxpayer has to pay for these costly mistakes committed by the federal agencies.
The pride of place for destructive Hurricanes, prior to Katrina, was held by Hurricane Andrew, which struck Louisiana and South Florida in 1992 (Hurricane Andrew, 2002). It was responsible for loss estimated to be $26.5 billion or $43.7 billion at present rates and the loss of 23 lives (National Weather Service, n.d).
Reports conducted after the devastation caused by the Hurricanes Andrew and Katrina have suggested that state and local authorities had to be granted greater flexibility in contingency planning and clearer statutory authorization through the Stafford Act. The objective of this was to aid these agencies to better estimate the requirements for dealing with such emergencies (GAO Letter, 1994). In a nutshell, the implication is that FEMA is restrained in the matter of incurring expenditure and coming to the aid of disaster victims due to the lack of power to dispense funds without Presidential sanction.
Another major lacuna pointed out by these reports was that the federal officials had been given insufficient training to respond effectively to such disasters and that this was attributable to FEMA’s poor oversight. A 1993 GAO report pointed out that though FEMA had instituted training programs, its headquarters had failed to establish performance standards or an evaluating program to monitor performance (GAO Report, 1993).
In order to effectively get rid of debris, the FEMA developed a debris contractor registry, which is web-based database containing information about the availability and capability of these contractors. This service is expected to increase state and local governments’ capability to effectively deal with the debris problem in emergency situations (FEMA Report, 2006). “On the 18th of August, 2006, the FEMA director announced improvements in its satellite and mobile communications system, digital alert system, victim management program and policies to effectively deal with the next crisis”. (David Paulison, 2006)
It is essential to be aware of what to buy in order to deal with a crisis. In the absence of proper and in depth planning, improperly specified needs and incorrect negotiations the government will be unable to purchase goods and services economic prices. Therefore in a crisis, the government in general, buys at higher rates and the problem is compounded by unnecessary wastage. This situation can be improved by means of proper planning.
Moreover, due to pre landfall contracts and the absence of proper planning, federal agencies were in haste to get vendors, to evade the difficulties presented by negotiations, to resort to improper contractual methods and to pay higher amounts to buy goods and services. Consequently, the market forces, which control waste, fraud and abuse of government funds in the normal course and ensure that victims and the tax payers are not harmed by bad deals proved to be ineffective.
Several federal agencies had insufficient contingency plans in spite of having conducted mock drills in respect of catastrophic disasters and failed to procure goods and services at pre determined rates. During the day of the disaster, the FEMA was under pressure to give instructions to companies to commence work in the absence of a contract and to produce bills for having acquired food and other essential items. In most of these cases it had to rely on good faith between the agencies and the contractors (Oversight of Gulf Coast Hurricane Recovery, n.d). In some places, evacuation of hospitals took place in the absence of any contract whatsoever. Further, the FEMA failed to properly estimate the needs for temporary housing.
The 2004 GAO’s report on contingency planning concluded that only some of the contingency documents had sufficiently displayed the delegation of authority by federal agencies. In turn, agency staff was unaware of the fact as to which agency was the decision taking authority in a crisis (GAO Report, 2004). On some occasions insufficient planning with regard to temporary housing in particular led to wastage of hundreds of millions of dollars. For example, FEMA bought around 25,000 transitional homes and 27,000 travel trailers incurring an expenditure of more than $900 million. Regrettably, FEMA bought this temporary housing before planning its utilization. Due to this there were 17,055 homes and 5,707 travel trailers, which have not been used even by April 2006 (Oversight of Gulf Coast Hurricane Recovery, a Semiannual Report to Congress, 2006). Even a single such home had not been sent to Louisiana and Mississippi where the damage was at its utmost, due to the reason that FEMA’s own regulations prevent the use of the homes in flood plains (U.S. House of Representatives Committee on Government Reform, 2006). FEMA must have learnt a lesson from its misdeed. On the 18th of August 18, 2006, David Paulison, the director of FEMA, stated that the agency has 8,000 to 9,000 travel trailers in Hope, Arkansas, that are being maintained and kept in reserve for future emergencies (David Paulison, 2006).
Inadequate communication between Washington and people in the crisis area increased problems, although they were all working for the same agency. As an illustration, contrary to FEMA’s advice Alabama officials paid a contractor $10 million to repair 160 rooms and furnish another 80 rooms in military barracks. Since, local FEMA officials had stated the facility was unused to a large extent. At the same time, when FEMA officials wanted to lose it down only six people were residing there. FEMA also spent $3 million for 4,000 unused base camp beds (GAO Report, 2006).
In order to obviate misuse, the government should enter into pre established contingency contracts, and see to it that certain types of contracts that are vulnerable to abuse, like performance based contracts, interagency contracts, time and material contracts, and purchase card transactions are used only in particular circumstances and only if they are subjected to audit and oversight controls.
FEMA’s response to catastrophic disasters is decided by the Robert T. Stafford Disaster Relief and Emergency Assistance Act. Nevertheless, FEMA and other important federal agencies have consistently laboured to implement and comprehend the law. During the onslaught of the Hurricane Katrina, FEMA and other agencies were unwilling to enforce the Stafford Act’s penchant for the utilization of local contractors (Hurricane Katrina, 2006). However, there is no novelty in this, because as a 1993 GAO report on federal disaster management had revealed that federal agencies had been proven singularly unsuccessful in making adequate provisions to deal with the disaster, due to ignorance about the requirements of the statutory guidance (GAO Letter Report, 1994).
In its examination of federal agency responses to Hurricane Katrina, the House Select Committee to Investigate the Preparation for and Response to Hurricane Katrina found that the Stafford Act’s ambiguous statutory guidance in respect of local contractor participation had resulted in few local firms receiving contracts. Moreover, it had created ongoing disputes over procuring contracts for debris removal and other services (A Failure of Initiative, 2006).
The worst instance of non-competitive contracting was that of the award of the four no-bid contracts to Fluor, CH2M Hill, Bechtel and the Shaw Group, subsequent to Hurricane Katrina having struck land. The value of each of these contracts was a staggering $500 million. On October 6, 2005, the FEMA director, Paulison, testified before the Senate Homeland Security and Governmental Affairs Committee, that FEMA would bring about a re bid in each of these contracts. This did transpire belatedly in August 2006, but in the re bidding the ceiling of the contracts was raised and this led to the payment of more than $3.3 billion to these companies (FEMA, 2006). To reduce public criticism, FEMA distributed contracts, amounting to $3.6 billion, for providing temporary hurricane-victim houses to small and minority-owned firms (FEMA Press Release, 2006). However, FEMA has not been consistent in re bidding contracts at the end of the emergency period (President’s Council on Integrity and Efficiency, 2006).
The lame excuse that is trotted out by Federal agencies for this inefficient purchasing method is that due to the desperate nature of a crisis it becomes difficult, if not impossible, to indulge in bidding from vendors in order to procure goods and services. In the cogent example of the Military Sealift Command’s endeavour to acquire cruise ships to be used as temporary housing for FEMA, the government obtained competitive bids from seven contractors in a competition for 13 vessels and this was done in 19.5 hours (Department of the Navy Memorandum, 2006).
It has been observed that in the process of recovery from the havoc wreaked by the Hurricane Katrina, waste and fraud was endemic in the $10.6 billion federal recovery contracts. This outcome was expected as most of these contracts were awarded noncompetitively and due to the reason that the Bush administration had declined to make the contracting process transparent.
The result is the vast amounts of debris visible throughout the New Orleans and Mississippi coastal regions. Moreover, thousands of Katrina victims are yet to receive checks to commence the rebuilding process and thousands of people are waiting on the Federal Emergency Management Agency trailers, a sizeable number of which have become rusted in the hot and humid rural Arkansas. These FEMA trailers symbolize and impart the lesson of apathy and ineptness of the Federal Agencies. These agencies are incapable of dealing with disasters and will have to pull themselves by the bootstraps if they intend to respond properly to disasters.
1. A Failure of Initiative, February 15, 2006, p. 5, 17. Retrieved October 13, 2006, from http://www.gpoaccess.gov/katrinareport/mainreport.pdf#search=%22katrina%20a%20failure%20of%20initiative%22.
2. Congressional Research Service Report (RL 33053), August 29, 2005. “Federal Stafford Act Disaster Assistance: Presidential Declarations, Eligible Activities, and Funding,” Retrieved October 13, 2006, from http://www.fas.org/sgp/crs/homesec/RL33053.pdf#search=%22stafford%20act%20CRS%22.
3. Department of the Navy Memorandum (N2006-0015), February 16, 2006, “Chartered Cruise Ships,” p. 4. Retrieved October 13, 2006, from http://www.dhs.gov/interweb/assetlibrary/OIG_NAV_N06-0015.pdf#search=%22n2006-0015%22.
4. DHS, “National Response Plan”. Retrieved October 13, 2006, from http://www.dhs.gov/dhspublic/interapp/editorial_0566.xml.
5. FEMA Report (1642-033), n.d, “Disaster Recovery Experts Advise: Be Careful When Hiring Contractors for Repairs”, Retrieved October 13, 2006, from http://www.fema.gov/news/newsrelease.fema?id=28344.
6. FEMA Press Release (HQ-06-049), March 31, 2006. “Small Business Administration Work Together to Award Hurricane Katrina Recovery Contracts to Small and Minority-Owned Businesses,” Retrieved October 13, 2006, from http://www.fema.gov/news/newsrelease.fema?id=24682.
7. FEMA, August 9, 2006. “Individual Assistance – Technical Assistance Contracts (IA-TACs) Contracts Awarded for the 2005 Hurricane Season,” Retrieved October 13, 2006, from http://www.fema.gov/media/backgrounders/ia-tacs.shtm.
8. FEMA Report (HQ-06-114), July 24, 2006. “FEMA Launches Debris Contractor Registry to Assist Communities”, Retrieved October 13, 2006, from http://www.fema.gov/news/newsrelease.fema?id=28179.
9. GAO (GAO-06-714T), On May 4, 2006, Retrieved October 13, 2006, from http://www.gao.gov/new.items/d06714t.pdf.
10. GAO Report (GAO-04-160), February 2004, “Continuity of Operations: Improved Planning Needed to Ensure Delivery of Essential Government Services,” p. 12. Retrieved October 13, 2006, from http://www.gao.gov/new.items/d04160.pdf.
11. GAO Report (GAO-06-714T) Report, May 4, 2006, “Hurricane Katrina: Improving Federal Contracting Practices In Disaster Recovery Operations,” p. 4, 6. Retrieved October 13, 2006, from http://www.gao.gov/new.items/d06714t.pdf.
12. GAO Letter Report (GAO/RCED-94-293R), August 31, 1994, “GAO Work on Disaster Assistance,” p. 17. Retrieved October 13, 2006, from http://archive.gao.gov/t2pbat2/152456.pdf.
13. GAO Letter (GAO/RCED-94-293R), August 31, 1994 “GAO Work on Disaster Assistance,” p. 17. Retrieved October 13, 2006, from http://archive.gao.gov/t2pbat2/152456.pdf.
14. GAO Report (GAO/T-RCED-93-46), May 25, 1993, “Disaster Management: Recent Disasters Demonstrate the Need to Improve the Nation’s Response Strategy,” p. 26. Retrieved October 13, 2006, from http://archive.gao.gov/d43t14/149256.pdf.
15. “Hurricane Katrina: Improving Federal Contracting Practices in Disaster Recovery Operations,” May 4, 2006, p. 4. Retrieved October 13, 2006, from http://www.gao.gov/new.items/d06714t.pdf.
17. http://www.whitehouse.gov /news/releases /2006/06/20060615-15.html.
19. National Weather Service, National Hurricane Center, Tropical Prediction Center, “Costliest U.S. Hurricanes 1900-2004 (unadjusted).” Retrieved October 13, 2006, from http://www.nhc.noaa.gov/pastcost.shtml.
20. NOAA, August 22, 2002. “Hurricane Andrew.” Retrieved October 13, 2006, from http://www.noaa.gov/hurricaneandrew.html.
21. Oversight of Gulf Coast Hurricane Recovery: A 90-Day Progress Report to Congress, p.8. Retrieved October 13, 2006, from http://www.ignet.gov/pande/hsr/hk90dayrpt.pdf.
22. Press briefing with FEMA Director David Paulison, August 18, 2006. Available at rtsp://video.c-span.org/project/hur/hur081806_katrina.rm.
23. President’s Council on Integrity and Efficiency, April 30, 2006, “Oversight of Gulf Coast Hurricane Recovery, a Semiannual Report to Congress,” p. 124-125. Retrieved October 13, 2006, from http://www.dhs.gov/interweb/assetlibrary/OIG_pcie_april06.pdf.
24. President’s Council on Integrity and Efficiency, December 30, 2005. “Oversight of Gulf Coast Hurricane Recovery: A 90- Day Progress Report to Congress,” p.3. Retrieved October 13, 2006, from http://www.ignet.gov/pande/hsr/hk90daysrpt.pdf.
25. The Holy Bible. Luke 4:23.
26. UNITED STATES HOUSE OF REPRESENTATIVES COMMITTEE ON GOVERNMENT REFORM — MINORITY STAFF SPECIAL INVESTIGATIONS DIVISION, AUGUST 2006, “WASTE, FRAUD, AND ABUSE IN HURRICANE KATRINA CONTRACTS”, Retrieved October 13, 2006, from http://www.democrats.reform.house.gov/Documents/20060824110705-30132.pdf.
27. U.S. House of Representatives Committee on Government Reform, July 2006, “Waste, Abuse, and Mismanagement in Department of Homeland Security Contracts,” p. 16. Retrieved October 13, 2006, from http://www.democrats.reform.house.gov/Documents/20060727092939-29369.pdf#search=%22richard%20l.%20skinner%20katrina%20trailers%20site%3A.gov%22.
28. White House Report, February 2006 “The Federal Response to Hurricane Katrina: Lessons Learned”, p.1. Retrieved October 13, 2006, from http://www.whitehouse.gov/reports/katrina-lessons-learned.pdf.