Prior to making an award, FEMA will evaluate a recipient to determine the level of risk when there is a history of failure to comply with general or specific terms and conditions of a federal award or failure to meet the expected performance goals. Some elements that FEMA will review include financial stability, quality of management systems, history of performance (including compliance with reporting requirements), conformance to the terms and conditions of previous awards, reports and findings from prior audits, and the ability to effectively implement statutory, regulatory and other program requirements imposed on the recipient. If FEMA determines that a federal award will be made, special conditions that correspond to the degree of risk assessed may be applied to the award.[212]
As part of the risk assessment, the federal awarding agency is required by the Improper Payments Elimination and Recovery Improvement Act of 2012 [213] to review information available through any Office of Management and Budget-designated repositories of government-wide eligibility qualification or financial integrity information as appropriate.[214] FEMA must also review a recipient’s status in the System for Award Management. FEMA must comply with government-wide suspension and debarment regulations and require that non-federal entities comply with these requirements.[215] Recipients must also conduct risk assessments of their subrecipients.[216]
If a recipient determines a particular risk associated with a subrecipient, the recipient may impose additional conditions or requirements. [217] If additional conditions and requirements are imposed, FEMA must promptly remove them once the conditions that prompted the additional conditions or requirements have been satisfied.[218]
For HMA programs, additional conditions or requirements may include:
- Requiring payments as reimbursement rather than advance payments.
- Withholding authority to proceed to the next phase until receipt of evidence of acceptable progress within a given period of performance is provided.
- Requiring additional, more detailed financial reports.
- Requiring additional monitoring.
- Requiring the recipient or subrecipient to obtain technical or management assistance.
- Establishing additional prior approvals, such as requiring the preparation of a management plan.
For those recipients that receive assistance from FEMA regularly, designated staff shall complete the risk assessment annually at the beginning of the fiscal year. For other recipients, the assessment will be completed at the time of application review and then annually until the period of performance has ended.[219]
Recipients can request reconsideration of the specific conditions using the appeal or reconsideration process described in Part 10. If the appeal or reconsideration is successful, or if the circumstances that prompted imposing specific conditions have been corrected, FEMA must remove specific conditions.
Refer to Part 10 for more information on program-specific appeals or reconsiderations.