From the LA Times:
Louisiana Officials Indicted Before Katrina Hit
Federal audits found dubious expenditures by the state's emergency preparedness agency, which will administer FEMA hurricane aid.
By Ken Silverstein and Josh Meyer, Times Staff Writers
WASHINGTON — Senior officials in Louisiana's emergency planning agency already were awaiting trial over allegations stemming from a federal investigation into waste, mismanagement and missing funds when Hurricane Katrina struck.
And federal auditors are still trying to track as much as $60 million in unaccounted for funds that were funneled to the state from the Federal Emergency Management Agency dating back to 1998.
In March, FEMA demanded that Louisiana repay $30.4 million to the federal government.
The problems are particularly worrisome, federal officials said, because they involve the Louisiana Office of Homeland Security and Emergency Preparedness, the agency that will administer much of the billions in federal aid anticipated for victims of Katrina.
Earlier this week, federal Homeland Security officials announced they would send 30 investigators and auditors to the Gulf Coast to ensure relief funds were properly spent.
Details of the ongoing criminal investigations come from two reports by the inspector general's office in the U.S. Department of Homeland Security, which oversees FEMA, as well as in state audits, and interviews this week with federal and state officials.
The reports were prepared by the federal agency's field office in Denton, Texas, and cover 1998 to 2003. Improper expenditures previously identified by auditors include a parka, a briefcase and a trip to Germany.
Much of the FEMA money that was unaccounted for was sent to Louisiana under the Hazard Mitigation Grant program, intended to help states retrofit property and improve flood control facilities, for example.
The $30.4 million FEMA is demanding back was money paid into that program and others, including a program to buy out flood-prone homeowners. As much as $30 million in additional unaccounted for spending also is under review in audits that have not yet been released, according to a FEMA official.
One 2003 federal investigation of allegedly misspent funds in Ouachita Parish, a district in northern Louisiana, grew into a probe that sprawled into more than 20 other parishes.
Mark Smith, a spokesman for the Louisiana emergency office, said the agency had responded to calls for reform, and that "we now have the policy and personnel in place to ensure that past problems aren't repeated."
He said earlier problems were largely administrative mistakes, not due to corruption.
But federal officials disagreed. They said FEMA for years expressed concerns over patterns of improper management and lax oversight throughout the state agency, and said most problems had not been corrected.
They point to criminal indictments of three state workers as evidence the problem was more than management missteps. Two other state emergency officials also were identified in court documents as unindicted co-conspirators.
"The charges were made after some very extensive reviews by FEMA investigators and other authorities, who identified issues they felt were of the severity and magnitude to refer them to the U.S. attorney's office," said David Passey, the spokesman for FEMA's regional office in Texas.
Passey, while acknowledging that the state had made some administrative changes, said it had not completed the kind of overhaul FEMA said was needed.
"It concerns us a lot. We are devoted to the mission of helping people prepare for, prevent and recover from disasters and we want these federal funds — this taxpayer money — to be spent and used well and in accordance with the rules," he said.
Keith Ashdown of Taxpayers for Common Sense, a Washington watchdog group, said recent Louisiana history showed that FEMA "money earmarked for saving lives and homes'' was instead squandered in "a cesspool of wasteful spending."
Louisiana's emergency office receives money directly from FEMA. It passes on much of the funding to local governments that apply for assistance.
The audit reports said state operating procedures increased the likelihood of fraud and corruption going undetected.
As I have previously stated, I think once the liberal left quits blaming President Bush for everything from acts of God to their hangnails, and this actually gets investigated, that the local and state officials in NO/Louisiana will be found to be largely to blame for the magnitude of mismanagment that led to the human suffering in New Orleans. Watch how Houston has/is preparing for Rita. Certainly FEMA is being more proactive with Rita on the heels of the blasting they have taken for Katrina response (and some of those criticisms are appropriate), but Houston and the state and locals leaders are where action is really happening in Texas.