NEW ORLEANS — The Federal Emergency Management Agency should take back $2 billion dollars in grants approved to fix New Orleans sewers and water pipes damaged by Hurricane Katrina, and to repair streets afterward, a federal audit says. FEMA says no.

The Department of Homeland Security inspector general’s office prepared the audit. It says the pipes were old and in bad condition before the storm, and the city didn’t have paperwork to prove the damages are disaster related, news outlets reported.

FEMA has agreed with 100 of 103 audits from the Department of Homeland Security inspector general’s office, but this is one of the three exceptions, the agency said in a news release Wednesday.

“Throughout the audit process, agency staff provided detailed documentation,” it said.

The FEMA grants make up most of what the city has to begin work on an estimated $9 billion repair backlog, media reported.

However, the matter may not go any farther unless the inspector general appeals to higher authorities in the U.S. Department of Homeland Security, The New Orleans Advocate reported.

Teams from FEMA and the city “went over every mile of street in the city,” Cedric Grant, executive director of New Orleans’ Sewerage & Water Board, told The Advocate. He called it “the most comprehensive review of a road system for damage that FEMA has ever done.”

The audit “defies logic,” Zach Butterworth, Mayor Mitch Landrieu’s executive counsel and federal lobbyist, told Nola.com | The Times-Picayune. “We’re just going to push back very strongly against this.”

“Regardless of its age, the New Orleans infrastructure was functioning to serve a population of 445,000 prior to Hurricane Katrina,” FEMA wrote in a response included with IG’s report and quoted by WWL-TV . “This infrastructure was damaged by Hurricane Katrina and FEMA appropriately limited the approved funding to Katrina-related disaster damage.”