Federal Audit Claims Erie County Owes FEMA Over $48 Million

6:04 PM, Feb 28, 2013   |    comments
  • Share
  • Print
  • - A A A +

BUFFALO, NY-- A federal audit claims Erie County owes FEMA millions of dollars from the surprise October Storm in 2006.

WEB EXTRA: Click here to read the audit

Erie County was originally awarded over $55 million to help cover costs from the storm.

The surprise storm dumped nearly two feet of snow overnight, causing several trees and limbs to fall, as well as power lines through Erie County and other parts of WNY.

New York and then President George W. Bush declared Erie County, and surrounding counties a major disaster.

The audit was conducted by the Office of Inspector General and released last month.

Here are some of the audit findings:

  • Erie County did not comply with Federal grant regulations and FEMA
    guidelines when awarding contracts totaling $39.4 million.
  • FEMA reimbursed the County $9 million for inadequately supported costs.
  • Erie County improperly charged $33,066 of administrative costs as direct costs, and included  $10,456 of duplicate costs within the claimed Emergency Operations Center supply costs.
  • Contrary to Federal procurement regulations, the County Executive directed the County's Purchasing Department to award contracts giving preference to local contractors.

According to the audit, it states Erie County officials said they spoke with FEMA to get acceptance prior to implementing the local
contracting decision. However, auditors say the County could not substantiate the claim or provide the names of the FEMA officials who said that the County could disregard the Code of Federal Regulations in awarding contracts.

Erie County was under the direction of former County Executive Joel Giambra during the October Storm.

Reached by phone, Giambra told WGRZ-TV, "we did what we did in order to get trees off of peoples houses as quickly as we could--without waiting for a bunch of gypsy contractors to come from out of town."

Giambra added that, "FEMA officials didn't tell me anything as county executive, I made a statement that in a crisis, if there was an opportunity to use local contractors to help us with this clean up then, that would a be priority and a preference." 


Current Erie County Executive Mark Poloncarz defended Giambra, and called the audit flawed, and "legally wrong".

At Wednesday news conference, Poloncarz blasted both the findings of the audit and those who conducted it, who he predicted would be "reprimanded for issuing an audit that relied upon the wrong law."

The law Poloncarz (himself an attorney) cited was The Local Community Recovery Act of 2006, which was an Act of Congress amending the Stafford Disaster Relief and Emergency Assistance Act passed and signed into law by President George W. Bush on 4/20/2006 as a direct response to Hurricane Katrina.

Poloncarz contends it specifically directed that in federally-declared disasters, local officials give explicit preferences for hiring local businesses to perform disaster recovery.

Poloncarz says that if the county did have to pay the money back, Erie County would not be able to and the county's credit rating could drop. 


An opinion rendered by the Erie County Department of Law notes that the Stafford Act provisions and the Department of Homeland Security Appropriations Act of 2007 supersede the Code of Federal Regulations (44CFR 13.36(c)(ii)) provision cited by Federal Auditors as justification for the recoupment of federal disaster funding in relation to the October 2006 Storm. 

FEMA has not yet demanded payment of the amount which the audit, prepared by the Department of Homeland Security Office of Inspector General.

Arlen Morales, a public affairs officer with the Office of Inspector General in Washington D.C. told Two On Your Side the agency stands by its conclusions. She also says her agency takes no role in making recommendations to other agencies (in this case FEMA) what they should do with their findings, and could not compel them to seek payment.

Congressman Brian Higgins has already written letters to both FEMA and the Office of Inspector General, suggesting to the latter that it should perhaps take a look at quality of work being done by its auditors, while recommending to FEMA that it not try and recoup the money.

Congressman Chris Collins and Senator Charles Schumer also think that Erie County shouldn't have to repay the money. 


"$48 million...?" asked a surprised NY Governor Andrew Cuomo, when asked to comment on the audit's findings." That's...quite a big number, and a big problem. I'll have to take a look at it, I hadn't heard about it," Cuomo said.  

Though federal emergency dollars were the subject of the audit, New York State acted as the pass through agency for the money to Erie County in the aftermath of the October 2006 storm.

Poloncarz said Cuomo and others dealing in the aftermath of Hurricane Sandy and relying on FEMA's assistance would be wise to heed what is happening here, and to pay close attention to regulations which "these auditors apparently aren't properly aware of." 

Back in 2011, FEMA asked for payments back from some WNY residents who had received payment from FEMA following the storm.

The county has until the end of May to respond to the government's review.

Source: Office of Inspector General

Most Watched Videos