Management Alert -
FEMA's COVID-19 Funeral
Assistance Operating
Procedures Are Inconsistent
with Previous Interpretation
of Long-Standing Regulations
for Eligible Funeral Expenses
April 13,
2022
OIG-22-36
April 13, 2022
OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
Summary of Issues
We are issuing this management alert to advise the Federal Emergency
Management Agency (FEMA) that its Coronavirus disease 2019 (COVID-19)
Funeral Assistance Program operating procedures are inconsistent with
FEMA’s previous interpretation of long-standing regulations for ineligible
funeral expenses established in FEMA’s Individual Assistance Program and
Policy Guide
1
(IAPPG). This interpretation of regulations for ineligible funeral
expenses remains unchanged in FEMA Policy 104-21-0001
2
(COVID-19-specific
policy).
During our ongoing audit of the COVID-19 Funeral Assistance Program, we
determined, and verified through analyzing a sample of completed program
applications, that FEMA regularly reimburses
3
applicants for expenses
expressly excluded from funeral assistance in the IAPPG. Due to the
unprecedented size of this program and the uncertainty surrounding the
duration of the COVID-19 pandemic, FEMA must take action to curb
reimbursement of ineligible expenses to avoid further waste and abuse of
taxpayer dollars.
Background
According to Section 408 of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act, 42 U.S.C. §§ 5121 et seq. (Stafford Act), the
President may provide financial assistance and, if necessary, direct services to
individuals and households who, as a direct result of a major disaster, have
necessary expenses and serious needs (emphasis added), including funeral
expenses.
4
Funeral assistance is typically available when the President authorizes the
Individual and Households Program pursuant to a declaration of emergency or
major disaster under the Stafford Act. In December 2020, Congress
1
Individual Assistance Program and Policy Guide (IAPPG), FP 104-009-03, March 2019.
2
FEMA POLICY: COVID-19 Funeral Assistance Individuals and Households Program Policy
(Interim) (Version 2), FEMA Policy 104-21-0001, June 29, 2021.
3
Funeral assistance applicants are not necessarily required to pay for funeral expenses prior to
FEMA awarding funeral assistance, but they are required to submit documentation
demonstrating that they incurred funeral expenses before FEMA awards funeral assistance. A
funeral home contract may satisfy FEMA’s expense documentation requirements if it includes
the applicant’s name as the responsible party for the expenses, the total amount of the funeral
expenses, the decedent’s name, and the date funeral expenses were incurred. Our review
indicates that most funeral assistance issued on applications we reviewed was for funeral
service expenses that were paid; i.e., reimbursements. Therefore, this alert refers to funeral
assistance payments as reimbursements throughout.
4
42 U.S.C. § 5174(a)(1), (e)(1).
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
appropriated $2 billion to FEMA’s Disaster Relief Fund to provide financial
assistance to individuals and households to reimburse COVID-19-related
funeral expenses incurred through December 31, 2020. Both the Coronavirus
Response and Relief Supplemental Appropriations Act of 2021 and the
subsequent American Rescue Plan Act of 2021 (ARPA) required FEMA to provide
funeral assistance for COVID-19-related deaths at 100 percent Federal cost
share. The ARPA appropriation for FEMA expires on September 30, 2025.
In furtherance of the authority granted by Section 408 of the Stafford Act and
delegated to FEMA by the President, FEMA promulgated regulations for
providing financial assistance for funeral expenses.
5
Historically, funeral
expenses eligible for reimbursement have been generally limited to funeral
services; burial or cremation; and other related funeral expenses.
6
Since
September 30, 2016, FEMA has provided further guidance in its Individuals
and Households Program Unified Guidance, which was superseded by the
IAPPG in January 2019. The IAPPG is publicly available and lists eligible
funeral assistance expenses. Additionally, the IAPPG expressly excludes
certain expenses, such as assistance for obituaries; flowers; printed materials
such as banners, programs, or register books; catering services, including food;
transportation of the applicant or others to site(s) of funeral services,
interment, or reinterment; and gratuities.
In March 2021, FEMA implemented a publicly available COVID-19-specific
policy to streamline delivery of funeral assistance granted in connection with
the COVID-19 pandemic.
7
Although the COVID-19-specific policy does not
introduce a new list of eligible expenses, it modifies previous policy by stating
“[e]ligible funeral service expenses include, but are not limited to ….” (emphasis
added). According to the COVID-19-specific policy, any provisions set forth in
the IAPPG not specifically addressed by the COVID-19-specific policy remain
unchanged.
FEMA supplemented its COVID-19-specific policy with disaster-specific
operating procedures, which, unlike the IAPPG and COVID-19-specific policy,
are not available to the public. These operating procedures provide FEMA
employees and contractors guidance on applicants’ assistance eligibility,
eligibility of reimbursable funeral expenses, and documentation required for
eligibility.
5
See 44 C.F.R. § 206.119.
6
44 C.F.R. § 206.119(c)(4)(i)-(iii).
7
FEMA issued a second version of the COVID-19-specific policy in June 2021.
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
FEMA’s COVID-19 Funeral Assistance Operating Procedures Are
Inconsistent with Previous Interpretation of Long-Standing
Regulations for Eligible Funeral Expenses
FEMA is putting millions of taxpayer dollars at an elevated risk of waste and
abuse by reimbursing funeral expenses identified as ineligible by its own
policies. As part of our ongoing audit of the COVID-19 Funeral Assistance
Program, we determined that FEMA regularly reimburses for items expressly
excluded by the IAPPG such as obituaries; flowers; printed materials, such as
programs and register books; catering; transporting applicant or others to
site(s) of funeral services; and gratuities. Specifically, during our review, we
identified 98 of 166 approved applications (59 percent) that contained expenses
identified as ineligible in the IAPPG.
FEMA’s COVID-19-specific policy states, “Eligible funeral service expenses
include, but are not limited to: transportation for up to two individuals to
identify the decedent; transfer of remains; casket or urn; burial plot or
cremation niche; marker or headstone; clergy or officiant services; arrangement
of the funeral ceremony; use of funeral home equipment or staff; interment
costs; costs associated with producing and certifying multiple death
certificates; and additional expenses mandated by any applicable state or local
government laws or ordinances.” The COVID-19-specific policy does not
include any statement about funeral service expenses for which FEMA will not
provide assistance, but it does state, “All ONA Funeral Assistance provisions
established in FEMA Policy 104-009-03, Individual Assistance Program and
Policy Guide, and not specifically addressed by this Interim Policy remain
unchanged.” Per FEMA’s COVID-19 operating procedures, if listed on a funeral
receipt, eligible expenses include the following, some of which the IAPPG
expressly excludes: “Gratuities; portraits; funeral jewelry for survivors; memory
t-shirts/blankets; travel or boat purchases intended to scatter ashes outside of
a memorial service; perpetual care of burial grounds; AND [capitalized in the
original] items purchased for individuals attending the funeral or service, such
as travel costs, clothing, hotel costs.”
Making the IAPPG and FEMA’s COVID-19-specific policy available to the public
suggests that FEMA administers the COVID-19 Funeral Assistance Program in
accordance with these policies. The Congressional Research Service (CRS)
shares this interpretation. In an overview report of the program issued on
June 30, 2021, CRS cited the IAPPG in identifying expenses ineligible for
reimbursement to include obituaries, flowers, and printed materials.
8
In
contrast to the IAPPG and COVID-19-specific policy, the operating procedures
8
ELIZABETH M. WEBSTER, FEMA FUNERAL ASSISTANCE FOR COVID-19, Congressional
Research Service IN11582 (Updated June 30, 2021).
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
instruct FEMA employees and contractors to accept for reimbursement all
verifiable funeral expenses (except for burial society membership dues, late or
finance charges, and airfare tickets for an individual transporting remains)
listed on expense documents from a funeral home, including receipts, invoices,
or signed contracts.
As a result, applicants who submit documentation that they incurred expenses
— such as a $1,050 charge for flowers; a $420 charge for printed materials
including prayer cards, a leather register book, and portraits; a $1,300 charge
for a catered reception provided by the funeral home; or a $3,760 charge for
transportation including two lead escort vehicles, a limousine, and a horse and
carriage — are all eligible to be reimbursed by FEMA as long as the expenses
appear on a funeral home receipt, invoice, or signed contract. These expenses
are not eligible for reimbursement under the IAPPG. FEMA’s IAPPG, by listing
both eligible and ineligible expenses, aligns with the Stafford Act’s intent to
assist those who have necessary expenses and serious needs. The IAPPG
demonstrates considered, principled expertise in determining which costs to
reimburse in connection with funeral services and burials, in contrast to the
lack of safeguards established in FEMA’s COVID-19 operating procedures.
The regulations, IAPPG, and FEMA practice in other disasters all demonstrate
that FEMA has consistently interpreted the statutory term “funeral expenses”
to exclude obituaries; flowers; printed materials such as banners, programs, or
register books; catering services, including food; transportation of the applicant
or others to site(s) of funeral services, interment, or reinterment; and gratuities.
However, in connection with the COVID-19 pandemic, FEMA is reimbursing
funeral expenses that it does not reimburse in other disasters. In a current
example, FEMA publicly maintains that it cannot provide assistance for funeral
expenses expressly precluded from eligibility in the IAPPG in connection with
the June 24, 2021, Florida Surfside building collapse. For the Florida Surfside
collapse or other disaster in which FEMA offers funeral assistance, an
applicant who incurs funeral expenses is not eligible to receive reimbursement
for certain expenses eligible for reimbursement under FEMA’s COVID-19
funeral assistance operating procedures.
According to FEMA officials, the intent of the COVID-19-specific policy and
operating procedures is to broaden the list of eligible expenses prescribed by
the IAPPG. They explained that the eligible expenses listed in the COVID-19-
specific policy are not exhaustive, and the phrase “[e]ligible funeral service
expenses include, but are not limited to” gives FEMA the flexibility to reimburse
additional funeral expenses — even those specifically excluded in the IAPPG.
FEMA officials stated it kept relevant congressional committee staff, a Senator,
and a U.S. Representative apprised of its plan to expand the eligible expenses
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
for reimbursement, including adopting a “higher-level view of line item
eligibility than normal to make this process easier.”
However, the evidence FEMA provided does not show it informed lawmakers of
its plan to reimburse applicants for expenses expressly precluded from
eligibility in the IAPPG,
9
or that FEMA informed Congress of operating
procedures that do not limit payments to necessary expenses. Further,
according to the COVID-19-specific policy, any provisions set forth by the
IAPPG not specifically addressed by the COVID-19-specific policy remain
unchanged. FEMA’s COVID-19-specific policy does not modify the IAPPG’s list
of ineligible expenses. Therefore, FEMA should use the IAPPG and its own
COVID-19-specific policy to determine eligible expenses for reimbursement.
Any expenses FEMA is willing to consider for reimbursement that are not listed
in FEMA’s own policies must be tied to necessary expenses associated with
funeral services and/or burials. Evaluating the necessity of certain expenses
by their presence on a funeral receipt does not, alone, provide assurance that
funds are being expended consistent with governing authorities.
We determined it was necessary to issue this management alert because, under
FEMA’s current operating procedures, there is no assurance that: (1) funeral
assistance funds are being used to reimburse necessary expenses and serious
needs; (2) expenses are being checked line-by-line; (3) expenses specifically
excluded from payment in other disasters are not being reimbursed in
connection with COVID-19 without notice to the public; and (4) FEMA is
complying with its own policies.
Currently, publicly available policies (IAPPG and COVID-19-specific policy)
suggest FEMA is more restrictive when reimbursing COVID-19 funeral
expenses than FEMA’s operating procedures provide. FEMA states that it has
authority to deviate from its standing policy in the context of the COVID-19
pandemic but has not articulated a rationale for doing so or otherwise
demonstrated any rigor in its evaluation of expenses reimbursable for funeral
assistance beyond stating such expenses need to be listed on a funeral receipt.
FEMA stated that its Office of Counsel did not review or approve its disaster-
specific operating procedures.
Recommendation
We recommend that the Federal Emergency Management Agency Administrator
immediately issue modified COVID-19 Funeral Assistance operating procedures
that align with the Individual Assistance Program and Policy Guide provisions
9
OIG requested relevant documentation during a November 16, 2021 meeting with FEMA on
this topic.
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
on ineligible funeral assistance expenses and ensure all future cost
reimbursements by FEMA in connection with the COVID-19 Funeral
Assistance Program are necessary expenses associated with funeral services
and/or burials.
Management Comments and OIG Analysis
We gave FEMA a draft of this management alert on February 25, 2022, for its
review and response. FEMA responded on March 10, 2022, nonconcurring
with our recommendation and requesting the OIG consider the
recommendation resolved and closed. A summary of FEMA’s response and our
analysis follow. We include the full response in this alert as Appendix B.
FEMA Comments to Recommendation: FEMA nonconcurred with our
recommendation. FEMA asserted that it has broad authority to determine
eligible costs for funeral assistance pursuant to 44 C.F.R. § 206.119(c)(4)(iii)
and to implement disaster-specific changes to policy through Interim Policy
development. FEMA leadership believes the COVID-19-specific policy provides
the flexibility and expediency lawmakers intended regarding the extent to
which FEMA should provide necessary expenses (emphasis added) associated
with COVID-19-related funerals. FEMA also pointed to the unprecedented
scale of the COVID-19 Funeral Assistance Program, in comparison to its
experience with such applications from a 2017 hurricane. Additionally, FEMA
leadership believes that implementing our recommendation would create
inequalities to the detriment of future applicants, who would qualify for less
assistance for fewer eligible expenses.
OIG Analysis of FEMA’s Response:
As pointed out by FEMA, 44 C.F.R. § 206.119(c)(4)(iii) provides it with the
authority to determine eligible costs for Funeral Assistance. FEMA did not,
however, consider the impact that key statutory terms necessary expenses and
serious needs have on its administration of COVID-19 Funeral Assistance in its
response to our draft management alert. Both the Stafford Act and 44 C.F.R. §
206.119 employ these terms when defining FEMA’s authorities to administer
funeral assistance. As pointed out in the management alert, FEMA has
historically interpreted the regulations governing funeral assistance to mean
that it cannot provide assistance for obituaries; flowers; printed materials such
as banners, programs, or register books; catering services, including food;
transportation of the applicant or others to site(s) of funeral services,
interment, or reinterment; and gratuities.
We acknowledge FEMA’s extensive engagement with congressional
stakeholders regarding the intent of the laws authorizing FEMA to administer
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
the COVID-19 Funeral Assistance Program, and we understand the resulting
guiding principles of this engagement were speed, empathy, and flexibility.
FEMA’s statutory and regulatory requirements to provide funeral assistance for
necessary expenses and serious needs do not preclude it from taking those
guiding principles into account as it executes the Funeral Assistance Program.
However, FEMA’s issuance of operating procedures that evaluate the eligibility
of certain expenses solely by their presence on a funeral receipt subverts those
statutory and regulatory requirements.
We acknowledge the volume of COVID-19 funeral assistance applications
compared to other more localized disasters. However, for the COVID-19
Funeral Assistance Program, FEMA procured significant contractual assistance
to process applications and supplement the efforts of its existing staff at a cost
of over $294 million.
Finally, we disagree with FEMA’s assertion that implementing this
management alert’s recommendation would create inequality for COVID-19
Funeral Assistance Program applicants, post-implementation. As pointed out
in the management alert, FEMA has excluded certain expenses from funeral
assistance eligibility in disasters FEMA is responding to concurrently with
COVID-19. Thus, by implementing this management alert’s recommendation,
FEMA remedies the current inequality in funeral assistance practices and
reverts FEMA to the statutory and regulatory interpretation it has operated
under while administering funeral assistance in other instances.
Implementation of OIG’s recommendation will ensure applicants from different
disasters are treated equally and COVID-19 funeral assistance complies with
applicable statutory and regulatory provisions.
We therefore consider the recommendation unresolved and open.
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
Appendix A
Objective, Scope, and Methodology
The Department of Homeland Security Office of Inspector General was
established by the Homeland Security Act of 2002, Pub. L. No. 107−296, 116
Stat. 2135, which amended the Inspector General Act of 1978. We issued this
management alert during an ongoing audit of FEMA’s COVID-19 Funeral
Assistance Program.
The objective of our ongoing audit is to determine to what extent FEMA
implemented internal controls to provide oversight of its COVID-19 Funeral
Assistance Program. Between July 30, 2021 and November 2, 2021, we
accessed FEMA’s National Emergency Management Information System to
review individual COVID-19 Funeral Assistance Program applications, partially
completing a review of a statistical sample. We also held discussions about our
review with FEMA program officials on September 14, 2021; November 16,
2021; and February 8, 2022.
Within our scope of review, the Funeral Assistance Program had 170,489
approved cases and 3,915 denied cases, totaling 174,404 cases. Given a
universe/population of 174,404 cases, the statistically valid sample size, based
on 95 percent confidence level, 5 percent sampling error, and 50 percent
population proportion, was 383 cases.
This audit is ongoing; thus, we have not yet analyzed 383 statistically valid
samples. To date, we have examined 166 approved cases. Of the 166
approved cases, we identified 98 cases in which an applicant received
reimbursement for expenses deemed ineligible by the IAPPG. Fifty-six of these
98 cases would have received a reduced final award had FEMA enforced its
own policy on ineligible expenses.
10
We also obtained documentary evidence, such as overarching program and
policy guidance for FEMA’s Individual Assistance programs prescribed in the
Individual Assistance Program and Policy Guide (FP 104-009-03). We obtained
FEMA’s disaster-specific policy for COVID-19 funeral assistance (COVID-19
Funeral Assistance Individuals and Households Program Policy (Interim)
(Version 2) FEMA Policy #104-21-001 issued June 29, 2021). Finally, we
obtained FEMA’s disaster-specific operating procedures (DSOP), COVID-19
10
There is a $9,000 limit on COVID-19 Funeral Assistance Program awards, per decedent. Of
the 98 cases we identified, 56 would have received a reduced final award had FEMA enforced
IAPPG provisions on ineligible expenses. The remaining 42 cases would not have received a
reduced final award because the IAPPG-ineligible expenses were less than the difference
between the total expenses submitted by the applicant and their full $9,000 award.
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
Funeral Assistance DSOP, with an effective date of June 29, 2021. We
analyzed the requirements within these policies and procedures with respect to
the eligible funeral service expenses and obtained a legal opinion based on our
OIG Office of Counsel’s interpretation.
We conducted this work pursuant to the Inspector General Act of 1978, as
amended, and in connection with an ongoing audit being performed according
to generally accepted government auditing standards. Those standards require
we plan and perform our audit work to obtain sufficient, appropriate evidence
to provide a reasonable basis for our findings and conclusions based on our
audit objectives.
Additional information or recommendations regarding the issue(s) addressed in
this alert may be included in the final audit report from our ongoing work of
determining to what extent FEMA implemented internal controls to provide
oversight of its COVID-19 Funeral Assistance Program.
The OIG Office of Audits major contributors to this management alert are Larry
Arnold, Director; John Skrmetti, Audit Manager; Christopher Stephens,
Auditor-in-Charge; Mary James, Program Analyst; Katrina Griffin, Auditor;
Michael Scoffone, Auditor; Thomas Hamlin, Communications Analyst; and
Ericka Kristine Odiña, Independent Referencer. The OIG Office of Innovation
major contributor to this management alert is Muhammad Islam, Statistician.
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OFFICE OF INSPECTOR GENERAL
Department of Homeland Security
Appendix C
Report Distribution
Department of Homeland Security
Secretary
Deputy Secretary
Chief of Staff
Deputy Chiefs of Staff
General Counsel
Executive Secretary
Director, GAO/OIG Liaison Office -Project 21-039-AUD-FEMA
Under Secretary, Office of Strategy, Policy, and Plans
Assistant Secretary for Office of Public Affairs
Assistant Secretary for Office of Legislative Affairs
FEMA Audit Liaison
Office of Management and Budget
Chief, Homeland Security Branch
DHS OIG Budget Examiner
Congress
Congressional Oversight and Appropriations Committees
The Honorable Mike Braun, United States Senate
The Honorable Chuck Grassley, United States Senate
Pandemic Response Accountability Committee
www.oig.dhs.gov 17 OIG-22-36
Additional Information and Copies
To view this and any of our other reports, please visit our website at:
www.oig.dhs.gov.
For further information or questions, please contact Office of Inspector General
Public Affairs at: DHS-OIG.OfficePublicAffairs@oig.dhs.gov.
Follow us on Twitter at: @dhsoig.
OIG Hotline
To report fraud, waste, or abuse, visit our website at www.oig.dhs.gov and click
on the red "Hotline" tab. If you cannot access our website, call our hotline at
(800) 323-8603, fax our hotline at (202) 254-4297, or write to us at:
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Attention: Hotline
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Washington, DC 20528-0305
