American Samoa’s Department of Homeland Security (ASDHS) has been able to successfully address concerns raised by the U.S. Department of Homeland  Security (USDHS) Office of Inspector General (OIG) through an audit done two years ago, which has resulted in funds being released under the “restricted cash draw down status”.

The restricted cash draw down is limited to five grant awards “to enable FEMA to further evaluate the internal controls and accountability guidelines ASDHS has established, and how well these guidelines are followed,” said Nancy Ward, the Regional Administrator for FEMA Region IX, in a July 6 letter written to Gov. Togiola Tulafono.

“After six months of restricted cash draws, FEMA will reevaluate American Samoa’s performance to determine if additional grant awards can be placed on restricted cash draw status or if the restriction can be lifted,” wrote Ward.

The July 6 letter informed the Governor on the status of the ASDHS Corrective Action Plan dated Feb. 4, 2009, which included the submission of supporting documentation in response to USDHS-FEMA letter dated Dec. 18, 2008.

In the December letter, FEMA recognized ASDHS for their diligence and the committed effort which had been made to come into compliance with federal regulations, program guidance and information requests.

“Further, current staff is to be commended for the efforts of researching and locating hard-to-find documents to support the questionable costs detailed in the Office of Inspector’s General (OIG) audit; the current staff was not on-board when the audit issues surfaced,” Ward wrote in the July 6 letter to the Governor.

Ward says the submitted documentation has enabled FEMA to determine if questioned costs “were allowable and allocable costs” which totaled $438,889.

These questionable costs included $250,000 for an All-Hazards Early Warning Broadcast System; $30,804 for travel/training (includes $21,108 in travel expenses); $98,398 for planning and $30,021 for emergency operation center (EOC) equipment and audio networking system.

After reviewing the submitted documents, Ward says the final decision with respect to the resolution of the questioned costs comes down to $412,280 being disallowed. (See tomorrow’s edition on FEMA’s final decision on these disallowed costs).

Of the total disallowed costs, $404,059 will be offset against the applicable grant award to reduce the total award amount and a grant adjustment notice has been sent to ASG, according to the letter.

The grants used for off-setting include $13,136 for FY 2003 Homeland Security Grant Program (Part 1); $110,651 in FY 2003 Homeland Security Grant Program (Part 2) and $280,272 in FY 2004 Homeland Security Grant Program.

Ward said the remaining disallowable cost of $8,221 cannot be offset because the grant (which was awarded in 2002) has been closed. She also informed Togiola of ASG’s right to appeal the decision and the process involved.

However, Samoa News understands ASG has already sent the payment to USDHS using local funds, as Ward made it clear in her letter that federal grants cannot be used for the payment.

Ward informed the Governor that once the audit disallowance has been addressed, American Samoa will be placed on restricted cash draw-down status, adding that the following grants will be considered under the initial phase of the restricted draw down:

• FY 2005 Homeland Security Grant Program (HSGP)

• FY 2007 Emergency Management Performance Grant (EMPG)

• FY 2007 Public Safety Interoperable Communications (PSIC)

• FY 2008 Emergency Management Performance Grant (EMPG)

• FY 2008 REAL ID

These five grants total a little over $1 million.

“In addition, it is anticipated that ASDHS’ approved federal award expenditures will exceed $500,000 this year and ASDHS will be required” to meet federal audit requirements, she said. “We look forward to your continued success.”

Responding to Samoa News inquiries, ASDHS director Mike Sala said his office was able to meet and address USDHS/FEMA concerns because of the tremendous “leadership of the governor, who wanted to resolve these issues as soon as possible to ensure continued efforts are made towards lifting the ‘high risk’ status on American Samoa’s federal grant programs.”

Sala acknowledged the outstanding work of his staff, and thanked the Treasury Department, Budget Office, Procurement Office and all ASG agencies who cooperated in making sure that documents were found and submitted to the feds in a timely manner.