Mayor-President Kip Holden's handling of Homeland Security grants came under fire Friday from Metro Council members.

Several council members expressed concern about the potential financial impact of a state agency's decision to strip Holden's office of control over two federal Homeland Security grant programs.

Councilman Joel Boe said the city-parish faces having to find money from an already tight budget to cover Homeland Security expenses that might not be reimbursed from federal grants.

"I feel like the responsibility lies 100 percent with the mayor," Boe said. "He's put us in a spot we shouldn't have to be in. This is completely self-inflicted by one particular individual."

Mayor Pro Tem Mike Walker said it is going to pose a problem if the city-parish doesn't get reimbursed for some expenses that have already been incurred.

"We've spent money that should not have been spent that we could be using during these tight budget times," Walker said. "I think that the entire council should be concerned about it."

Holden did not respond Thursday and Friday to emails and telephone requests for comment on the grant issue.

The Governor's Office of Homeland Security and Emergency Preparedness acted Thursday to take control away from the Mayor's Office of Homeland Security and Emergency Preparedness, which was put on probation for two years.

State officials said they took the action because the mayor's Office of Homeland Security was refusing to follow state and federal guidelines other Louisiana parishes follow.

Holden has challenged a GOHSEP requirement that the sheriff of each parish review and sign off on federal Homeland Security grants under the two grant programs. He has said GOHSEP lacks legal authority to impose the requirement.

Federal Homeland Security funds are awarded to the state, which in turn apportions grants to parishes based on population and risk factors.

In its action Thursday, GOHSEP designated the East Baton Rouge Parish Sheriff's Office and Ascension Parish Office of Homeland Security and Emergency Preparedness as the new grant managers and fiduciary agents.

At issue are grants totaling $4 million for fiscal years 2009 and 2010 and a grant for fiscal year 2011 that has not yet been awarded.

The Holden administration has already spent more than $1.2 million but is in jeopardy of not being reimbursed for some expenses. The money was used to pay for staff salaries and to buy police helicopter equipment, patrol bikes, Apple iPads and other items, records show.

The city-parish was notified last month that it was at risk of being terminated from managing Homeland Security grant programs because of deficiencies in handling grants.

The warning came in a Sept. 6 letter that GOHSEP Deputy Director Clayton Rives sent to JoAnne Moreau, director of the Mayor's Office of Homeland Security.

The letter advised that East Baton Rouge Parish was being suspended from participating in Homeland Security Grant Programs and would have 30 days to correct deficiencies the letter outlined. The deadline was later extended to Oct. 26.

The deficiencies cited included MOHSEP's failure to itemize purchases submitted for reimbursement; non-compliance with program rules and failure to provide required documentation.

"Failure to correct these deficiencies ... will result in termination of EBR Parish from the referenced grant programs for the referenced years, de-obligation of the related grant funding, and jeopardize the award of future grants to EBR Parish by this agency," Rives wrote.

The actions GOHSEP is taking appear to have the support of U.S. Department of Homeland Security officials who deal with grant programs.

In a letter dated Sept. 19, Corey Walz of the federal agency's grant programs directorate provided written guidance "in the event East Baton Rouge Parish does not comply with the terms and conditions outlined in the Sept. 6" letter that Rives sent.

Walz wrote "GOHSEP, as the awardee, has the authority to take necessary actions to ensure that subgrantees comply with all applicable federal and state laws."

The authority includes "terminating any open awards, withholding any future awards and disallowing any pending reimbursement requests," Walz wrote.

Councilman Scott Wilson said the administration had "more than enough time to take care of this" and that it "reflects badly on the parish" to lose control of the programs.

"The mayor owes an explanation to the people of this parish," Wilson said.

Councilwoman C. Denise Marcelle said she's concerned about the $1.2 million the city-parish has already spent that was supposed to be reimbursed from grants in fiscal years 2009 and 2010.

"Allegedly, we did not have permission to spend it," Marcelle said. "My question to the mayor is, when do we get an accounting for how we spent that money?"

Councilman Trae Welch noted GOHSEP has already said it won't reimburse the city-parish for $362,784 spent under fiscal year 2008 grants because the expenditures didn't comply with program rules. He said that number appears likely to grow while GOHSEP reviews claims under grants in fiscal years 2009 and 2010.

Welch said that could create serious problems because the city-parish doesn't even have $550,000 in its budget to cover health insurance premium cost increases for employees.

"It's a mess, no doubt," said Councilman Rodney "Smokie" Bourgeois. "We all knew it was coming."

Councilman Chandler Loupe said he had planned to move forward in November with a public hearing that would examine MOHSEP and its spending practices. But he said he is now considering a full scale investigation, including taking testimony from people under oath.

Loupe said the Plan of Government gives the Metro Council authority to launch a formal investigation.

"I intend to pursue it," Loupe said.