FEMA Wasted Billions on Administrative Costs
Policy + Politics

FEMA Wasted Billions on Administrative Costs

A federal watchdog has raised concerns about how much of the Federal Emergency Management Agency’s budget is going toward administrative costs – instead of disaster relief.  

The Government Accountability Office says that the amount of FEMA funding that has gone toward administrative costs like salaries for senior executive employees, travel expenses and field office leases has nearly doubled over the last decade.

Related: FEMA’s $240 M Disaster Relief System Doesn’t Work

Auditors said in a new report out this week that from 2004 to 2013, FEMA spent about $12.7 billion on administrative costs. That’s about 12 percent of the total $95.2 billion the agency was allocated to respond to hurricanes, earthquakes and other disasters – and up from about 9 percent between 1980 and 1995. 


FEMA is routinely under scrutiny for the way it spends its money, as well as the way it doles out money to disaster victims. While there seems to be little or no accountability for the failures, taxpayers too often end up on the hook.

The GAO said FEMA has not met its own goals for cutting spending; if it had, “administrative costs could have been reduced by hundreds of millions of dollars.” The auditors added, “FEMA lacks an integrated plan with time frames and milestones to hold senior officials accountable for achieving its goals to reduce and more effectively control costs. Such a plan could help FEMA to better oversee and control these costs.”

Lawmakers who requested the report had harsh words for the agency. “The fact that FEMA spent $12.7 billion on administrative costs is unacceptable. FEMA should be spending money on vital assistance for those negatively impacted by disasters – not on excessive administrative costs,” chairman of the Committee on Homeland Security Michael McCaul (R-TX), said in a statement. “Taxpayers deserve responsible and effective disaster relief and the committee will continue to monitor FEMA’s management of taxpayer funds…”  

GAO has routinely flagged FEMA for ballooning administrative costs. Earlier this year, auditors issued a similar report detailing the agency’s spending practices. Between 2004 and 2011, for example, administrative costs made up about 18 percent of the budget.

Related: FEMA Still Doesn’t Know Where Its Money Is Going

Since then, GAO said FEMA has made an effort to reduce the costs – yet there’s still room for improvement. In both reports, auditors suggested FEMA developed a new strategy with goals to reduce the percentage of disaster relief spent on administrative costs.

FEMA concurred with the auditors’ recommendations and said it would continue to look for ways to manage administrative costs. “FEMA has prioritized improving administrative cost management and made reducing disaster administrative costs a performance goal in its Strategic Plan,” Department of Homeland Security’s Jim Crumpacker said in a written response to the GAO.

The new scrutiny over FEMA’s spending practices comes as the costs of responding to natural disasters continues to climb. As we reported earlier, the costs of responding to natural disasters has doubled in the last two decades from $100 to $200 billion, according to an estimate by Munich-Re, the world’s largest re-insurance agency.

And while auditors are questioning FEMA’s administrative expenses, the agency also routinely receives criticism for the way it administers disaster aid. For example, FEMA is currently trying to recoup about $5.8 million in disaster relief it improperly doled out during Hurricane Sandy. The agency has asked storm victims who are disabled, elderly and poor to repay thousands of dollars because they mistakenly received the aid two years ago.

That was not the first time FEMA botched its administration of disaster relief. The same thing happened during Hurricane Katrina in 2005; the agency is still trying to recoup some of those funds.

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