PORT SECURITY: Take the Money and Run

US Ports Risk Millions in crush to file FEMA paperwork.

 

Across America, from sea to shining sea, hundreds of millions of dollars in Port Security Grant funds that have already been awarded to prevent terrorist attacks at ports, port security agencies, cruise and cargo terminals are about to turn to dust.

Grantees were ordered by FEMA in February 2012 to take immediate steps to expend, draw down or close out DHS/FEMA Port Security Grants or quickly reprogram the languishing funds. If this is not done very soon, “DHS/ FEMA will reclaim them to the extent permitted by law,” according to FEMA’s dire Bulletin 379. Deadlines and timelines for that edict are as follows:

 

• All FY 2007 grant funding must be spent by June 30, 2012
  
• All FY 2008 and 2009 grant funding must be spent by September 30, 2012
  
• All FY 2010 funding must be spent by September 30, 2013
  
• All FY 2011 and FY 2012 funding must be spent by the end date cited on the award agreement, no more than 3 years.

 

FEMA’s threat of repossession was caused because, according to FEMA’s early 2012 calculations, the most at-risk port communities in America have banked $303,980,061 of the $1,369,263,074 awarded to ports, terminals and security agencies from FY 2007 through 2010, “leaving a balance of $1,065,283,014.”

All of the $1 billion remaining in the federal treasury has been dedicated to thousands of security projects and equipment purchases approved at the highest levels as essential to protect ports against terrorist attacks.
 

The Obama administration has redefined the failed PSG program as a stimulus program. The execution of the new plan involves a carrot and stick. FEMA/DHS will grant extensions -- typically for no more than 6 months -- and will grant occasional, rare waivers of local matching funds; but only if the grantee Fiduciary Agents (FAs) who work for the subgrantee ports and security agencies will promptly file the proper paper work.

 

Future grants mercurial
Beginning with the 2012 grant cycle, individual ports and terminals will be required to apply directly to FEMA without the help of trained FAs and to compete with their neighbors and regional security agencies for a limited amount of grant funds that will be awarded based on an algorithm that matches estimated risk to theoretical mitigation. So, this is the last chance for many MTSA regulated facilities to secure and expend the millions in grant funds that they have already been awarded for 2007 – 2009. But even the most diligent port security officials are caught in a trap:

• Little has been done to capture this potential windfall because tight city, county, state and port budgets constrain department heads from requesting a 25% match.
• Under the rules in place until the 2012 grant cycle no money can be spent from Port Security Grants without the direct involvement of a single point of contact – often one person -- representing the Fiduciary Agent. That person is responsible to channel all communication, modifications, applications, requests for extensions, grant modifications and Environmental and Historical Preservation documentation from the subgrantees to the single FEMA Program Analyst (PA) assigned to the security region.
• The FA can draw up to 5% of the total value of the grants as compensation. But the FA earns that money in part by filing at least six reports a year for each grant. 
• FEMA disciplines the FA by refusing to even consider requests for extensions or reprogramming, disbursal or other actions critical to the port security needs of the region when the FA fails to file timely reports. 
• So if the POC for the FA screws up the paperwork, it doesn’t matter how diligent the subgrantee ports and terminals are in the region. It doesn’t matter how much the safety and security of their facilities require the support of FEMA grants. If the FA has not shuffled the papers correctly and on time, sub-grantees don’t get a hearing at FEMA.

 

The Risk of FA Failure

The FedReg says: “Upon receipt of the grantee’s request, the FEMA PA verifies compliance with financial reporting requirements by confirming that the grantee has submitted all necessary Federal Financial and Programmatic Reports (SF-425s and CAPRs/SAPRs).” And, that is mouthful.

 

It means that the Program Administrator at FEMA will not even begin to double check whether the FA/POC has filed correctly all financial reports until after the request for an extension (beyond Sep. 2012) has been submitted. That deadline for filing was April 30, 2012 with FEMA reserving the right to extend the filing deadline. But FEMA warns that the written request for extension “will be granted only due to compelling legal, policy, or operational challenges.”

 

Short course to success
The shortest course to success securing the grant funds awarded for 2007-2008 and 2009 is for subgrantees to pick the projects they really need. Agree to pay the match from budgeted funds. Accept the grant payment from the FA, and then pay the match in monthly or quarterly installments. That is allowed.

This way, if the POC for the FA has failed to keep up his or her end of the deal with FEMA the FA can’t get in the way of the approved grant award.

For those who have been awarded the 2010 and 2011 no-match grant funds, it is a no-brainer. Make sure your POC for the FA remains diligent and there are no administrative “holds” on the funds. Then go get them. (Subgrantees are entitled to access the same ND Grants files as the FA. No data can be altered, but the FA/POC diligence can be monitored by any stakeholder listed as a Contact in ND Grants computer program.)

For the lucky ones who have all their paperwork in order and have met the deadlines, there is a pot of gold available, especially if they request the things FEMA wants requested in this election year.
 

“In light of the current economic situation and the need for further economic stimulus, the Secretary announced the Department and FEMA’s commitment to provide grantees with additional flexibility to accelerate the spending of remaining FY 2007 - FY2011,” the FEMA bulletin said.
 

“DHS/FEMA will allow grantees to apply previously awarded FY 2007-2011 grant balances towards more urgent priorities by way of an expedited project approval by DHS/FEMA…. Specifically, this allows expenditure on general purpose equipment and overtime/backfill expenses for first responders engaged in protection or prevention activities consistent with grant guidance.”

 

FedSpeak decoded
That FedSpeak means that FEMA really wants subgrantees to spend this money. For all grants before 2012, the FA and the PA at FEMA have remarkable discretion in reprogramming approved grant funds within the parameters of the approved grant budget. And they will apply these rules:

 

1. Avoid all construction or any modification that could require an Environmental and Historical Preservation Study.
2. Go for increased hours of work for sworn law enforcement and first responders, especially if they are already on duty under an approved security plan. If they are union employees, all the better.
3. Buy maintenance agreements and updates for existing equipment that was purchased from grant funds.
4. Buy upgraded equipment and extended maintenance agreements that can be put to work on approved security details immediately including the vast category of “prevention.”
5. Spend the money on training programs already approved by the COPT.

 

One more tip
Use these words to make the algorithm happy: Each of the budget items has been reviewed by the Area Maritime Security Committee and the Captain of the Port and found to be necessary and reasonable for proper and efficient performance of established collaborative regional security enterprises and facility security plans.
 

 + taken from Maritime Professional magazine's 2Q print edition +

 

• Rick Eyerdam was editor of the Florida Shipper. He has written about and is considered an authority on government regulation of the marine industry. A past director of the Miami River Marine Group, he is a respected maritime consultant focused on port security and port security grant issues.