Vermont's management of a $2.9 million FEMA grant for flood recovery has drawn scrutiny after funds depleted faster than expected due to high contractor billing. The state hired Guidehouse to administer a disaster case management program, but the firm allocated nearly half the budget to its own staff. Experts warn this highlights broader issues in state oversight amid increasing disaster responsibilities.
In July 2024, Vermont endured severe flooding for the second consecutive summer, with up to 7 inches of rain on July 10 and 8.4 inches on July 30 in the Northeast Kingdom, killing two people and causing billions in damage. FEMA approved a $2.9 million grant in February 2025 to fund an 11-person disaster case management team for two years, aimed at helping 134 survivors with recovery plans.
The state allocated $400,000 for its administrative staff and $2.5 million to Guidehouse, a multinational consulting firm with a five-year master contract since 2020. However, Guidehouse subcontracted only seven workers through the New England Annual Conference of the United Methodist Church for $1.1 million, leaving over $1 million for its own services, including six employees.
On August 21, 2025, Jason Gosselin, emergency management director at the Vermont Agency of Human Services, emailed colleagues warning the funds were running out prematurely, with Guidehouse billing nearly half for its staff. By then, the firm had billed 4,877 hours worth over $500,000, with 48% going to its personnel, including director Lina Hashem at $293 per hour.
Prem Linskey, case management supervisor at Recovery After Floods Team, noted, “There is a huge need in the state... The state’s case management plan could have been much more effective if they had hired more people.” Former FEMA administrator Craig Fugate called it a “classic” example of vague contracts leading to excessive overhead.
Vermont's chief recovery officer Douglas Farnham defended the partnership, citing startup costs and Guidehouse's expertise, and said the state has since targeted 17% for the firm's billable work. FEMA warned of potential audits or clawbacks in a September 2025 email from Penelope Doherty. Experts like MaryAnn Tierney emphasized that diverting service funds to overhead is unacceptable, especially as climate change increases disasters and federal responsibilities shift to states.