Disaster Response:

Agencies Should Assess Contracting Workforce Needs and Purchase Card Fraud Risk

GAO-21-42: Published: Nov 24, 2020. Publicly Released: Nov 24, 2020.

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Marie A. Mak
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makm@gao.gov

 

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Contracts and purchase cards are 2 ways agencies can acquire goods and services to get urgently needed items after a disaster. We assessed selected agencies' planning for contracting workforce needs and purchase card fraud risks related to disaster response and found

Not all agencies planned for or assessed their contracting workforce needs for disaster response

Only 1 of the 6 agencies assessed how purchase card fraud risks change during disaster response

We recommended that agencies assess disaster contracting workforce needs and purchase card fraud risks to improve disaster response.

Canal debris in the Florida Keys following Hurricane Irma

A debris-filled canal

Additional Materials:

Contact:

Marie A. Mak
(202) 512-4841
makm@gao.gov

 

Office of Public Affairs
(202) 512-4800
youngc1@gao.gov

What GAO Found

The efforts of selected agencies to plan for disaster contracting activities and assess contracting workforce needs varied. The U.S. Forest Service initiated efforts to address its disaster response contracting workforce needs while three agencies—the U.S. Army Corps of Engineers (USACE), the U.S. Coast Guard, and Department of the Interior (DOI)—partially addressed these needs. The Environmental Protection Agency indicated it did not have concerns fulfilling its disaster contracting responsibilities. Specifically, GAO found the following:

USACE assigned clear roles and responsibilities for disaster response contracting activities, but has not formally assessed its contracting workforce to determine if it can fulfill these roles.

The Coast Guard has a process to assess its workforce needs, but it does not account for contracting for disaster response activities.

DOI is developing a strategic acquisition plan and additional guidance for its bureaus on how to structure their contracting functions, but currently does not account for disaster contracting responsibilities.

Contracting officials at all three of these agencies identified challenges executing their regular responsibilities along with their disaster-related responsibilities during the 2017 and 2018 hurricane and wildfire seasons. For example, Coast Guard contracting officials stated they have fallen increasingly behind since 2017 and that future disaster response missions would not be sustainable with their current workforce. GAO's strategic workforce planning principles call for agencies to determine the critical skills and competencies needed to achieve future programmatic results. Without accounting for disaster response contracting activities in workforce planning, these agencies are missing opportunities to ensure their contracting workforces are equipped to respond to future disasters.

The five agencies GAO reviewed from above, as well as the Federal Emergency Management Agency (FEMA), collectively spent more than $20 million for 2017 and 2018 disaster response activities using purchase cards. GAO found that two of these six agencies—Forest Service and EPA—have not completed fraud risk profiles for their purchase card programs that align with leading practices in GAO's Fraud Risk Framework. Additionally, five of the six agencies have not assessed or documented how their fraud risk for purchase card use might differ in a disaster response environment. DOI completed such an assessment during the course of our review. An Office of Management and Budget memorandum requires agencies to complete risk profiles for their purchase card programs that include fraud risk. GAO's Fraud Risk Framework states managers should assess fraud risk regularly and document those assessments in risk profiles. The framework also states that risk profiles may differ in the context of disaster response when managers may have a higher fraud risk tolerance since individuals in these environments have an urgent need for products and services. Without assessing fraud risk for purchase card programs or how risk may change in a disaster response environment, agencies may not design or implement effective internal controls, such as search criteria to identify fraudulent transactions.

Why GAO Did This Study

The 2017 and 2018 hurricanes and California wildfires affected millions of people and caused billions of dollars in damages. Extreme weather events are expected to become more frequent and intense due to climate change. Federal contracts for goods and services play a key role in disaster response and recovery, and government purchase cards can be used by agency staff to buy needed items.

GAO was asked to review federal response and recovery efforts related to recent disasters. This report examines the extent to which selected agencies planned for their disaster response contracting activities, assessed their contracting workforce needs, and assessed the fraud risk related to their use of purchase cards for disaster response.

GAO selected six agencies based on contract obligations for 2017 and 2018 disasters; analyzed federal procurement and agency data; reviewed agencies' policies on workforce planning, purchase card use, and fraud risk; and analyzed purchase card data. FEMA was not included in the examination of workforce planning due to prior GAO work.

What GAO Recommends

GAO is making 12 recommendations, including to three agencies to assess disaster response contracting needs in workforce planning, and to five agencies to assess fraud risk for purchase card use in support of disaster response.

For more information, contact Marie A. Mak at (202) 512-4841 or makm@gao.gov.

Recommendations for Executive Action

  1. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Army should ensure that the Commanding General of the Army Corps of Engineers develops guidance to ensure that its district-level affordability determinations account for the agency's disaster response contracting activities. (Recommendation 1)

    Agency Affected: Department of Defense: Department of the Army: Corps of Engineers

  2. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Commandant of the U.S. Coast Guard should provide guidance or incorporate into existing guidance information to ensure that the Coast Guard's manpower requirements determination for its acquisition directorate accounts for the agency's disaster response contracting activities. (Recommendation 2)

    Agency Affected: Department of Homeland Security: United States Coast Guard

  3. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Interior should ensure that upcoming guidance directs bureaus to consider their disaster contracting activities when planning their contracting workforce, where appropriate. (Recommendation 3)

    Agency Affected: Department of the Interior

  4. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Army should ensure that the Commanding General of the Army Corps of Engineers updates its fraud risk profile for the purchase card program to include an assessment of how, if at all, the risk profile differs for purchase card use in support of disaster response. (Recommendation 4)

    Agency Affected: Department of Defense: Department of the Army: Corps of Engineers

  5. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Administrator of the Federal Emergency Management Agency should update its fraud risk profile for the purchase card program to include an assessment of how, if at all, the risk profile differs for purchase card use in support of disaster response. (Recommendation 5)

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  6. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the U.S. Department of Agriculture should direct the Forest Service to update its fraud risk profile for the purchase card program to align with the leading practices in the Fraud Risk Framework and include an assessment of how, if at all, the risk profile differs for purchase card use in support of disaster response. (Recommendation 6)

    Agency Affected: Department of Agriculture

  7. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Commandant of the U.S. Coast Guard should update its fraud risk profile for the purchase card program to include an assessment of how, if at all, the risk profile differs for purchase card use in support of disaster response. (Recommendation 7)

    Agency Affected: Department of Homeland Security: United States Coast Guard

  8. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Administrator of the Environmental Protection Agency should take additional steps to complete and document a fraud risk profile for the purchase card program that aligns with the leading practices in the Fraud Risk Framework and includes an assessment of how, if at all, the risk profile differs for purchase card use in support of disaster response. (Recommendation 8)

    Agency Affected: Environmental Protection Agency

  9. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Administrator of the Federal Emergency Management Agency should ensure that the agency has adequate data to allow it to conduct analysis of purchase card use in support of disaster response, including both the disaster event supported and sufficient vendor information to allow fraud risk analysis. (Recommendation 9)

    Agency Affected: Department of Homeland Security: Directorate of Emergency Preparedness and Response: Federal Emergency Management Agency

  10. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Secretary of the Army should ensure that the Commanding General of the Army Corps of Engineers ensures that the agency has adequate data to allow it to conduct analysis of purchase card use in support of disaster response, including both the disaster event supported and sufficient vendor information to allow fraud risk analysis. (Recommendation 10)

    Agency Affected: Department of Defense: Department of the Army: Corps of Engineers

  11. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Commandant of the U.S. Coast Guard should ensure that the agency has adequate data to allow it to conduct analysis of purchase card use in support of disaster response, including both the disaster event supported and sufficient vendor information to allow fraud risk analysis. (Recommendation 11)

    Agency Affected: Department of Homeland Security: United States Coast Guard

  12. Status: Open

    Comments: When we confirm what actions the agency has taken in response to this recommendation, we will provide updated information.

    Recommendation: The Administrator of the Environmental Protection Agency should ensure that the agency has adequate data to allow it to conduct analysis of purchase card use in support of disaster response, including both the disaster event supported and sufficient vendor information to allow fraud risk analysis. (Recommendation 12)

    Agency Affected: Environmental Protection Agency

 

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