BUFFALO, NY - FEMA, the Federal Emergency Management Agency, has decided not to collect $48.5 million in reimbursement for the surprise October storm in 2006. FEMA has now decided to ask the county re-pay only $705,000.
A federal audit in February by the Department of Homeland Security Office of Inspector General claimed Erie County owed FEMA millions of dollars of storm cleanup costs.
Erie County was originally awarded over $55 million by FEMA 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.
The Department of Homeland Security said FEMA could ask for $48.5 million to be repaid.
"If we had to have done that it would've had very negative impact and would've seriously hurt Erie County's finances," said Mark Poloncarz, the county's executive.
The claim was that the county didn't follow federal rules when giving out contracts to local companies and couldn't support costs. Local officials and some federal lawmakers disputed the report saying the county followed the law.
Now, FEMA reveals the county put contracts out for bid and that although it wasn't a perfect process says it was open and fair.
"This is a huge win for the residents of Erie County," said Poloncarz.
But, FEMA adds that the county did not "fully comply with the applicable Federal procurement regulations."
"We believe we can pay this, it should have no impact on our 2013 budget where we end up with a negative budget," said Poloncarz.
Poloncarz says the county will payback the money using funds that've been received from the control board. 2 On Your Side reached out for comment from the Department of Homeland Security Office of Inspector General.
We asked whether the agency still stood by its report, but haven't gotten a response.
U.S. Sen. Charles Schumer, one of several federal lawmakers, who fought to make sure Erie County wouldn't have to repay the full $48.5 million said:
"Today's decision is a huge win for Erie Country officials and residents who will not have to pay back the great majority of $48.5 million dollars in federal disaster aid, a repayment which could have broken the bank and led to higher taxes and fees," said Schumer. "After the storm, Erie County officials turned to FEMA officials for guidance in the debris removal and cleanup process. FEMA approved the use of local contractors for this work, and then the agency unfairly reversed course to the tune of $48.5 million. Erie County officials worked in good faith with FEMA to respond to the crisis, and today's announcement vindicates their actions. I am pleased that FEMA Administrator Fugate and the Office of the Inspector General reached a more acceptable solution that will not unjustly slam Erie County taxpayers, and seriously threaten the county's finances. Now the county can move forward without this weight on their backs, knowing the correct decision was finally reached."