Two articles on the administrations incompetence is costing us Billions... -- Albany MSNBC Refugees Forum

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Date Posted: Thursday, December 29, 10:07:06am
Author: BJ
Subject: Two articles on the administrations incompetence is costing us Billions...

but have no fear the pugs will just cut more education funding, food and health services to the poor to cover their butts.

SBA finds 9/11 loan recipients ineligible

By LARRY MARGASAK, Associated Press
Last updated: 7:15 a.m., Thursday, December 29, 2005

WASHINGTON -- In a program to help businesses after Sept. 11, a high percentage of government-backed loans went to recipients who appeared to be unqualified -- some of them unaware they were receiving terrorism-recovery money, investigators report.
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The Small Business Administration's inspector general said Wednesday that agency officials were at fault for telling lenders in the program that their determinations would not be questioned.

The inspector general concluded that only nine loan recipients in the 59 cases sampled appeared to be qualified for disaster loans.

Lenders who handed out billions of dollars in loans failed -- 85 percent of the time -- to document that recipients were actually hurt by the terrorism attacks and therefore eligible for the aid under the law, the report found.

The investigative report substantiates key findings of an Associated Press story in September that found similar problems with the SBA's Supplementary Terrorist Activity Relief (STAR) program.

The AP found that terrorism recovery loans went to a South Dakota radio station, a Virgin Islands perfume shop, a Utah dog boutique and more than 100 Dunkin' Donuts and Subway sandwich shops in various locations.

Meanwhile, small businesses near Ground Zero in New York couldn't get the assistance they desperately sought.

SBA Administrator Hector Barreto put the best face on the findings, saying the audit did not find that loan recipients were unqualified for the program, although he did note that lender documentation could have been better.

His statement, however, was contradicted by the chairwoman of the Senate committee that oversees the SBA program.

"These initial findings are troubling and the committee ... will continue with its own investigation of the STAR program to get at the truth and inform Congress for the future," said Sen. Olympia Snowe, R-Maine.

Snowe, who heads the Committee on Small Business and Entrepreneurship, said if abuses are discovered, "many questions must be answered by the parties involved, beginning with: How and why was this allowed to happen?"

The inspector general's report said the program ran into trouble after lenders initially did not participate because requirements were unclear.

SBA officials then embarked on a vigorous marketing campaign, and lenders interpreted their remarks to mean "that every small business could claim it was somehow impacted by the attacks, and therefore, eligible to receive a STAR loan," the report said.

"We believe these communications were intended to, and did, send a message to lenders that the Agency would not question lender eligibility determinations," the inspector general reported.

The report found:

--Only two of 42 borrowers interviewed were aware they had obtained a STAR loan.

--In cases where eligibility could not be established, 25 of 34 borrowers interviewed said they were not adversely affected by the terrorist attacks.

--Thirty-six of 42 borrowers questioned said they were not asked, or could not recall if they were asked, about the impact of the attacks on their businesses.

http://timesunion.com/AspStories/story.asp?storyID=434215&category=&BCCode=&newsdate=12/29/2005

Report faults Homeland Security management
Inspector general also questions ability to oversee contracts

Thursday, December 29, 2005; Posted: 9:03 a.m. EST (14:03 GMT)

Department of Homeland Security Secretary Michael Chertoff oversees the third-largest department.
Weaknesses in FEMA's response system during Hurricane Katrina were just one symptom of major management challenges at the Homeland Security Department, an internal report issued Wednesday concludes.

The report by the department's inspector general also questions Homeland Security's ability to properly oversee billions of dollars worth of contracts it awards annually.

The inspector general's findings were issued as the nearly three-year-old department struggles to revamp its programs and resources to prioritize top risks. (Read the inspector general's report -- PDF)

The Federal Emergency Management Agency, an arm of the Homeland Security Department, was singled out as a top concern by investigators who pointed to the agency's "overburdened resources and infrastructure" in dealing with the double-whammy of hurricanes Katrina and Rita.

Investigators found that several key FEMA programs -- distributing aid to disaster victims, emergency response information systems, modernizing flood maps and managing contracts and grants -- remain inadequate.

"Based on our work related to prior emergency response efforts, we have raised concerns regarding weaknesses" within those programs, the audit by Homeland Security Inspector General Richard L. Skinner said.

Moreover, "when one considers that FEMA's programs are largely administered through grants and contracts, the circumstances created by hurricanes Katrina and Rita provide an unprecedented opportunity for fraud, waste and abuse," the report found.

"While DHS is taking several steps to manage and control spending under Katrina, the sheer size of the response and recovery efforts will create an unprecedented need for oversight," the report said.

Katrina slammed into the Gulf Coast on August 29, followed by Rita on September 24.

Department officials responded to the audit with an 11-page point-by-point analysis, acknowledging and explaining shortcomings in some areas and defending actions in others.

FEMA 'one of our greatest and most urgent priorities'
Homeland Security spokesman Russ Knocke said Wednesday the department is working to make programs more efficient and effective. He also called changes to FEMA "one of our greatest and most urgent priorities."

"The American public will be hearing from us, in short order, about how we intend to build the capability of FEMA into a 21st century agency, focusing on the agency's core response and recovery mission," Knocke said.

As of last week, the most recent data available, Homeland Security had awarded $4.1 billion in Katrina-related contracts -- mostly for construction and housing. By comparison, the department awarded nearly $10 billion in contracts on all projects last year, the audit found.

In its response, the department said it has created a procurement office to give strict oversight to the hurricane contracts process, and has brought in outside advisers to help.

The findings were part of an audit by Skinner's office, which is tasked with assessing Homeland Security's management challenges each year.

Homeland Security, the third-largest Cabinet-level federal department, has made progress since it was created in 2003 by merging 22 disparate agencies, the audit found.

However, "it still has much to do to establish a cohesive, efficient and effective organization."

Other areas of concern, as reviewed in the report, include:

Financial reporting problems, especially at U.S. Immigration and Customs Enforcement, which failed to properly maintain its accounting records.

Delays in creating and installing a new personnel system that replaced salaries based on workers' seniority with a merit pay system. The delays were caused, in part, by a federal lawsuit challenging the proposed regulations.

Poor coordination between border patrol officers and immigration investigators, contributing to security vulnerabilities at borders. Earlier this year, Skinner recommended merging the two entities to improve coordination, but Homeland Security Secretary Michael Chertoff has rejected that idea.

http://www.cnn.com/2005/POLITICS/12/29/homelandsecurity.mana.ap/index.html

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