Erie County may not have to repay more than $48 million in federal assistance awarded after the October 2006 snowstorm, if FEMA gets its way.
Instead, FEMA said in a report released today, that the county should return slightly more than $700,000 in grant money paid out for storm response and cleanup of debris.
The dispute arose earlier this year when an audit by the Department of Homeland Security inspector general’s office said the county had not complied with required bid practices in awarding local contracts for storm cleanup, and asked for repayment of about $48.5 million in FEMA grants.
Erie County disputed the results, and Sen. Charles E. Schumer, D-N.Y., and County Executive Mark Poloncarz in June persuaded FEMA to allow an independent review of the contracts. At the time, Schumer noted that FEMA had approved all the reimbursements during the storm cleanup and called its decision to reverse those payments seven years later “totally unfair.”
Poloncarz noted that should the county have to repay the entire amount, it would wipe out two-thirds of the county’s fund balance, potentially damaging its credit rating.
The decision released today reduces the amount of ineligible grant money to $705,641.
In issuing its opinion, FEMA noted that it believes Erie County did successfully compete for bids for debris removal, and awarded those contracts to the firms with the best proposals.
It also notes that the county followed state and local laws as well as federal regulations, even to the point of replacing early, more expensive contracts with more reasonably priced agreements.