09 SEP 2020
Michelle from Montreal expressed surprise that I called out FEMA when discussing public corruption. Failings from 2005 remain ingrained in that institution 15 years later. But is the organization itself corrupt? Let’s explore that now…
Is FEMA corrupt? The answer is nuanced, complex, but not yet a firm yes. FEMA could tip all the way to yes unless we engage corrective measures and recognition of the past and present issues.
FEMA's Financial Mission
I propose that we all view FEMA primarily as a financial agency. When one thinks of emergencies and emergency management, we want flashing lights and fast-moving trucks with too many radios. We need food and shelter and water. Yet, the folks who come when you dial 911 are local agencies and neighbors. When they get in trouble, they call their network of agencies – neighboring communities. When that goes all wrong, they call in the state. States can call in state resources including the national guard and other states. When an event is overwhelming all local resources, the governor can make a request of the president for additional help.
FEMA says out loud that all disasters are local.
If key legal thresholds are met – which are primarily financial – then FEMA can be sent in.
FEMA, a part of the Department of Homeland Security, has about 10,000 employees. These folks manage an annual budget of $16 Billion. Additionally, they manage the Disaster Relief Fund, which normally has about $50 billion in it.
During the latter part of August 2020, some news outlets did not get the math right. The Disaster Relief Fund is money that FEMA has already obligated to disaster-related projects. That cash belongs to grants promised to states and territories. As states and territories spend money, they get reimbursed by this fund. If FEMA removes $44B to provide funding for a specialty project, $44B in grant-funded projects will have their money de-obligated. You can only spend the same dollar one time.
To give scale to the volume of money FEMA managements, I’ll combine the $50 disaster relief fund and their annual budget for a total of $66 billion. This is just a bit less than the annual budgets for cities like LA, San Francisco, Chicago. FEMA manages more money than Ohio’s budget, more than Massachusetts, but less than Florida and Pennsylvania.
FEMA’s financial scope is on-par with our largest cities and our most populated states.
FEMA's Public Mission
FEMA identifies its own mission as “to help people before, during, and after disasters”. Yet, they don’t really do anything physical. They don’t fill sandbags. They don’t feed people. FEMA staff never shelters people. FEMA’s primary tool is money.
FEMA does provides training and certifications – typically executed by contractors and funded by grants. I carry dozens of such certifications from them and at one point I was an instructor.
Nationally, we misunderstand FEMA’s role in disaster.
The Missed Mission
If the response to and recovery from a disaster is expected to cost a state more than $3 per state resident, then FEMA financial assistance may kick in.
Less than 1% of the time FEMA is involved with a disaster involves the immediate planning and response activities. 99+% of the effort FEMA puts into disaster management involves the long-term management of money. I calculated this number using bad wild-ass guess-math: The minimum duration of a disaster that has significant impact is 18 months – about 550 days. Prep and response should be about 6 days. 3 days to prepare for the disaster. 3 days to rescue people, get them safe and open roads. These are gross generalizations based on norms.
FEMA grant funded recovery projects can last for years, and some for a decade or more – especially, very large capital projects. The funding projects for World Trade Center in lower Manhattan closed in the recent year or two. FEMA is still funding Hurricane Katrina projects from 2005 – fifteen years ago.
To restate, a significant, or majority of FEMA’s responsibility involves the stewardship of our tax dollars. Each dollar FEMA provides to someone is tangled in regulations and laws – all designed to prevent fraud, protect the water, land, and air from bad stuff.
If I told you that your job duties involved financial administration of grants to 58 states and territories while simultaneously overseeing that those who get the funding adhere to federal law, you might get one picture of a job.
If I told you that you’ll be part of the primary emergency response agency for the United States that rushes towards disasters, you’d have entirely different expectations of your workday.
I seriously wonder if we are recruiting, retaining, and promoting the wrong people at FEMA. Decades of public and internal criticism demonstrate that FEMA staff fail to execute in accordance with U.S. federal law.
Most of these laws are administrative rules and procedural. Failure to follow federal procurement law when managing a 1.8-billion-dollar contract does not necessarily brand a human as a criminal. You may not go to jail for that. People suffer. Consequences exist. Bad stuff happens to others, but the FEMA staff who routinely mismanage the funds muddle on.
The top job at FEMA is called “The Administrator”. Have any FEMA administrators been investigated or arrested for fraud or corruption-like activities? Yes, but the case involving Brock Long is very complicated and subtle. Brock believed that he should have access to the sort of communication equipment that maintained communication with senior government officials, therefore he used his official vehicle during non-government functions such as going home. Fire chiefs and police chiefs in the country routinely have a designated vehicle that they commute with. It gives them the ability to respond and communicate while off-duty. Well, that’s the question? Is the FEMA administrator ever off-duty?
Brock Long and the then-head of DHS, Kirstjen Nielsen, squared off against each other and feuded. Both are now gone from government service.
If you believe that the FEMA administrator is an always-on, always available position, then Brock operated within expected parameters. If the position more resembles a government staff position, then Brock used government equipment for personal gain.
My personal opinion, someone should shift the rules for the top FEMA position. He’s the it for disasters. There is no real down time. There is no off-duty time for that job. Brock Long once stood accused of violating a pretty basic rule. Government folks do not get to use government cars and engage staff when off duty – unless there is an exemption for that position. And there is not one for the head of FEMA. Got it.
For evermore, there is now an asterisk next to this top position at FEMA. This position has been sullied by at least one charge by seeking personal gain through the use of government funding. The administrators through 2019 tended to be individuals of high integrity and respected professionals.
On September 10th of 2019, FEMA’s Deputy Regional Administrator Ahsha Nateef Tribble, her former deputy, Jovanda R. Patterson, and former president Donald Keith Ellison of the US power company Cobra Acquisitions were indicted and arrested on charges of conspiracy to commit bribery of public officials; acts affecting a personal financial interest; false statements; disaster fraud; honest services wire fraud, Travel Act violations, and wire fraud. This announcement came from the U.S. Attorney’s office. The investigation team involved both the DHS and FBI.
Ms. Patterson was the FEMA deputy chief of staff assigned to Puerto Rico until she left in March of 2018 to work for Cobra Acquisitions.
$852 Million, nearly a billion dollars, moved from FEMA to Puerto Rico’s public-private partnership in charge of managing the disaster then to Cobra Acquisition. The indictment identifies about $5M in cash, and big pile of expensive toys being subject to federal forfeiture.
Of course, all parties are innocent until proven guilty.
Well, I certainly know of one individual arrested in Vermont for credit card fraud involving a government credit card. He was skimming cash off of purchases he made.
May of 2019, a FEMA employee was indicted for converting FEMA equipment to personal property: generator, phones, monitors, and tablet computers.
In any organization of 10,000 employees, there will likely be a few crooks – especially when blending the stress of disaster recovery, massive federal contracts, and a rapid flow of money and limited oversight.
Is FEMA Corrupt?
Is FEMA a corrupt organization?
I don’t know. They have had a flurry of indictment in the recent 2 years. The OIG reports are scathing.
It may lack for a sense of mission focus and contradictory expectations. Nobody really expects firefighters, cops, and medics to be bean-counters. As a firefighter, one is trained to put the wet stuff on the hot stuff. As a medic, we’re trained to keep the blood going around and around while making sure that air goes in and out. Culturally, those who respond to danger solve lifesaving problems rapidly and systematically. One makes a lot of decisions rapidly, and occasionally skirt rules and laws while saving lives and property. You learn to balance the greater-good questions. Furthermore, you learn to forgive yourself the bad moments – or be haunted by them.
When managing 66 billion in taxpayer’s money, one is never in an urgent life-or-death rush. It may seem that way, but it is not true. Life or death falls within the Rule of Threes. You can go 3 minutes without oxygen. You can go 3 days without water. And you can go 3 weeks without food. If we can get people to food, water, and toilets within 3 days, the criticality of a disaster is edges towards over.
The money comes later. The money reimburses agencies for their work. The money rebuilds roads, schools, and bridges.
My conclusion is that it is more likely ill-prepared for its mission than it is corrupt. But that comes with a huge warning sign. We’re completing a two-year period with several high-profile people being investigated for criminal activity. From the top position through senior leadership to the front-line staff positions, investigations have proved fruitful. Meanwhile, organizations that receive FEMA money are also failing to follow the rules.
FEMA has incubated an environment that may be permissive to corruption. FEMA is failing to detect corruption as it should. Therefore, one might argue it is either negligent in its duty. Or the agency is somehow complicit.
Willy Sutton Jr, the American bank robber of the early 1900 reportedly said: “I rob banks because that’s where the money is.”
Want to know where to find billions of dollars with oversight is less strict that the downtown bank? Basic training for a bank teller likely includes behavior, actions, and attitude to take during a robbery. FEMA staff don’t bother with the basic training on fraud prevention.
Should we hold FEMA to the same standard as the bank down the road? FEMA has a lot more money!
I’ll close with a story dots that almost connect to point to a top-to-bottom conspiracy. They do NOT connect. Again, a story offered as a warning.
FEMA spent $856 million of a $1.1 billion contract on Cobra Acquisition in 2018. Cobra Acquisitions had been hired to help the Puerto Rican power authority recover from the twin hurricanes of 2017. This contract resulted in multiple indictments and arrests within senior management of FEMA, as discussed above.
Cobra was the replacement contract for the Whitefish Energy contract. The Whitefish contract was valued at $1.8B.
Whitefish Energy is based in the city of Whitefish Montana. The city has about 5,000 residents. One of whom is/was Ryan Zinke. Mr. Zinke served as the secretary of the Interior from 2017 through 2019 when he resigned. Mr. Zinke’s name is associated with a complicated fraud scheme involving an oil pipeline company called Save the World Air and QA Energy. They pitched fake tech and posted fake results to defraud investors. The SEC got after those shenanigans. Zinke allegedly made millions from deal. Investors lost all.
So in a small city in Montana, resides the first ever cabinet secretary from Montana. He has had long associations with the energy business and possible fraudulent dealings. Then pops up a small energy company that wins a $1.8 billion contract with zero foundational experience – really nothing that would support Whitefish’s ability to help Puerto Rico.
Zinke left the Department of Interior under the stink of several allegations. He chartered a jet for $12,375 with government funds that went to an oil executive – a flight that should have cost $300 for a commercial airline. He apparently spent $14,000 on helicopters that he fobbed off as government expenses. The Interior Department OIG was investigating him. The United States Office of Special Counsel was investigating him for violations of the Hatch Act.
I guess when he resigned, all the stinky-stink left him.
I do wish we’d finish prosecuting these guys when they commit crimes then leave government service. Commit the crime, do the time.
How much time would a street crook serve if he or she stole $14,000 from the local bank?
The lovely politician? He can sell that experience as a consultant.