But Erie County executive Mark Poloncarz says the claim is unfounded, as the auditor based the claim on a law for local contracting was no longer in effect.
"Erie County followed the law and we're being criticized by a division of the Department of Homeland Security for supposedly not following the law when they're relying on the wrong provisions," Poloncarz said during a Wednesday afternoon news conference.
Erie County Comptroller Stefan Mychajliw says the county is working to address this problem as soon as possible.
"And I fully support the county executive ... I'll do whatever I can to help him and this administration make sure that FEMA does not put into place this recommendation from the Department of Homeland Security," Mychajliw said.
Among other items, the audit says Erie County didn't comply with federal grant regulations and FEMA guidelines in awarding contracts.
The office of Erie County Executive Mark Poloncarz released the following statement regarding the audit and its response to it.
Erie County Executive Mark C. Poloncarz released the following statement in response to an audit performed by the Department of Homeland Security Office of Inspector General (“Federal Auditors”) recommending that the Federal Emergency Management Agency (“FEMA”) should recover $48 million of Public Assistance Grant funds awarded to Erie County in relation to the October 2006 Storm.
“Federal Auditors are legally wrong to recommend the recoupment of $48 million in federal disaster funds based on ‘local preference’ comments made by County Executive Giambra at the time. Federal law in effect at the time of the October 2006 storm specifically directs that in federally-declared disasters, local officials give explicit preferences for hiring local businesses to perform disaster recovery. That is precisely what County Executive Giambra and other then-Erie County officials did. Frankly, we find it shocking that Federal Auditors would completely ignore such a well-known law when trying to justify their findings and recommending penalizing the county for following the law.”
“There is absolutely no evidence of improper use of these funds. It has also become clear that the bulk of the funds were spent within the spirit of federal regulations, and County officials at the time did everything with the full knowledge and approval of FEMA and New York State Emergency Management Office (“NYSEMO”) officials without any objections.
“The fact that after this storm and the storm recovery, after complying with on-scene FEMA and NYSEMO advice and guidance, after numerous NYSEMO and FEMA reviews and approvals, and six years after the storm, the Federal Auditors’ findings bring into serious question the reliability of advice from FEMA to local governments during an emergency event.
“I would caution our counterparts in New Jersey and the New York City area recovering from Superstorm Sandy to be wary of the advice you are given by Federal officials because even if you do everything based on their guidance, 5 or 10 years later, federal auditors may recommend repayment. That is not right and it is not fair.
“Along with our federal representatives, Erie County will do everything possible to demonstrate the misinterpretation of the law, flawed methodology used and improper opinions expressed by the federal auditors to stave off a potential new disaster – this time, a financial one – that local taxpayers need not have to bear.”
The Local Community Recovery Act of 2006, (an Act of Congress amending the Stafford Disaster Relief and Emergency Assistance Act passed and signed into law by President George W. Bush on 4/20/2006 as a direct response to Hurricane Katrina) specifically directed that in federally-declared disasters, local officials give explicit preferences for hiring local businesses to perform disaster recovery. An opinion rendered by the Erie County Department of Law notes that the Stafford Act provisions and the Department of Homeland Security Appropriations Act of 2007 supersede the Code of Federal Regulations (44CFR 13.36(c)(ii)) provision cited by Federal Auditors as justification for the recoupment of federal disaster funding in relation to the October 2006 Storm.