Region I News Releases

FEMA.gov

  • Direct result of disaster

    Appeal Type: 
    2nd
    Report Type: 
    PW
    Applicant Name: 
    Louisiana Department of Natural Resources
    Disaster Number: 
    1603-DR-LA
    DSR: 
    20449
    Date Signed: 
    Friday, February 6, 2015
    PA ID: 
    000-UCPOY-00
    Summary/Brief: 

    Conclusion: The requested debris removal in Lake Lery and Lake Hermitage is ineligible for Public Assistance (PA) funding because the Applicant did not establish that any debris in the two lakes is a direct result of the declared disaster, or that it poses an immediate threat.

    Summary Paragraph

    As a result of Hurricane Katrina, debris was deposited in waterways throughout Louisiana.  FEMA executed an Inter-Agency Agreement (IAA) with the United States Coast Guard (USCG) to remove eligible marine debris.  The USCG identified and removed eligible debris from Lake Lery and Lake Hermitage.  On August 8, 2012, the Applicant requested a new Project Worksheet (PW) for the “identification, removal, and disposal of waterborne debris” related to Hurricane Katrina from both lakes.  The Applicant did not document the existence of any debris.  FEMA prepared PW 20449 to address the Applicant’s request and determined the work to be ineligible because the USCG removed all Katrina-related debris that posed an immediate threat to life, public health, and safety.  In its first appeal letter, the Applicant claimed that Hurricane Katrina deposited debris on the water bottoms of Lake Lery and Lake Hermitage.  The Applicant reasoned that this debris should be eligible for PA funding pursuant to 44 C.F.R. § 206.224 because it continued to pose a risk to life, public health, and safety.  The Applicant also claimed that the USCG did not remove all eligible debris.  The Regional Administrator (RA) denied the appeal, finding that the Applicant did not include any documentation to establish the existence of any Katrina-related debris.  In its second appeal, the Applicant reiterates its first appeal claims, states that FEMA did not consider its first appeal documentation, and provides a draft trip report to demonstrate the existence of Katrina-related debris. 

    Authorities and Second Appeals

    • 44 C.F.R. § 206.223(a)(1).
    • 44 C.F.R. § 206.224(a).

    Headnotes

    • 44 C.F.R. § 206.223(a)(1) provides that, to be eligible, work must be required as a direct result of the disaster.
      • The Applicant has not established that any debris in the two lakes is a direct result of Hurricane Katrina.  Therefore, the proposed work to identify, remove, and dispose of any debris in the two lakes is ineligible.
    •  According to 44 C.F.R. § 206.224(a), if debris removal is in the public interest, the RA may provide assistance for the removal of debris and wreckage from publicly and privately owned lands and waters.  Debris removal is considered to be in the public interest when it is necessary to eliminate immediate threats to life, public health, and safety, or eliminate immediate threats of significant damage to improved public or private property.
      • More than nine years after the declared disaster, the Applicant has not demonstrated that any debris in the lakes poses an immediate threat.  Thus, the requested debris removal is ineligible.

     


     

    Letter: 

    February 6, 2015

    Kevin Davis
    Director
    Governor’s Office of Homeland Security and Emergency Preparedness
    7667 Independence Boulevard
    Baton Rouge, Louisiana 70806

    Re: Second Appeal – Louisiana Department of Natural Resources, PA ID 000-UCPOY-00, FEMA-1603-DR-LA, Project Worksheet (PW) 20449, Direct Result of Disaster

    Dear Mr. Davis:

    This is in response to your letter dated June 4, 2014, which transmitted the referenced second appeal on behalf of the Louisiana Department of Natural Resources (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of funding for debris removal from Lake Lery and Lake Hermitage. 

    As explained in the enclosed analysis, I have determined that the Applicant did not establish that any debris in these two lakes is a direct result of the disaster, or that the debris poses an immediate threat to life, public health, or safety.  In accordance with Title 44 of the Code of Federal Regulations (C.F.R.) § 206.223(a)(1), eligible work must be required as a direct result of the disaster.  Therefore, I am denying this appeal.

    Please inform the Applicant of my decision.  This determination constitutes the final decision on this matter pursuant to 44 C.F.R. § 206.206 Appeals. 

    Sincerely,                                   

    /s/

    William W. Roche
    Director
    Public Assistance Division

    Enclosure

    cc:  George A. Robinson
           Regional Administrator
           FEMA Region VI



     

  • Direct Result of Disaster

    Appeal Type: 
    2nd
    Report Type: 
    PW
    Appeal Categories: 
    Applicant Name: 
    Louisiana Department of Natural Resources
    Disaster Number: 
    1603-DR-LA
    DSR: 
    20449
    Date Signed: 
    Friday, February 6, 2015
    PA ID: 
    000-UCPOY-00
    Summary/Brief: 

    Conclusion: The requested debris removal in Lake Lery and Lake Hermitage is ineligible for Public Assistance (PA) funding because the Applicant did not establish that any debris in the two lakes is a direct result of the declared disaster, or that it poses an immediate threat.

    Summary Paragraph

    As a result of Hurricane Katrina, debris was deposited in waterways throughout Louisiana.  FEMA executed an Inter-Agency Agreement (IAA) with the United States Coast Guard (USCG) to remove eligible marine debris.  The USCG identified and removed eligible debris from Lake Lery and Lake Hermitage.  On August 8, 2012, the Applicant requested a new Project Worksheet (PW) for the “identification, removal, and disposal of waterborne debris” related to Hurricane Katrina from both lakes.  The Applicant did not document the existence of any debris.  FEMA prepared PW 20449 to address the Applicant’s request and determined the work to be ineligible because the USCG removed all Katrina-related debris that posed an immediate threat to life, public health, and safety.  In its first appeal letter, the Applicant claimed that Hurricane Katrina deposited debris on the water bottoms of Lake Lery and Lake Hermitage.  The Applicant reasoned that this debris should be eligible for PA funding pursuant to 44 C.F.R. § 206.224 because it continued to pose a risk to life, public health, and safety.  The Applicant also claimed that the USCG did not remove all eligible debris.  The Regional Administrator (RA) denied the appeal, finding that the Applicant did not include any documentation to establish the existence of any Katrina-related debris.  In its second appeal, the Applicant reiterates its first appeal claims, states that FEMA did not consider its first appeal documentation, and provides a draft trip report to demonstrate the existence of Katrina-related debris. 

    Authorities and Second Appeals

    • 44 C.F.R. § 206.223(a)(1).
    • 44 C.F.R. § 206.224(a).

    Headnotes

    • 44 C.F.R. § 206.223(a)(1) provides that, to be eligible, work must be required as a direct result of the disaster.
      • The Applicant has not established that any debris in the two lakes is a direct result of Hurricane Katrina.  Therefore, the proposed work to identify, remove, and dispose of any debris in the two lakes is ineligible.
    •  According to 44 C.F.R. § 206.224(a), if debris removal is in the public interest, the RA may provide assistance for the removal of debris and wreckage from publicly and privately owned lands and waters.  Debris removal is considered to be in the public interest when it is necessary to eliminate immediate threats to life, public health, and safety, or eliminate immediate threats of significant damage to improved public or private property.
      • More than nine years after the declared disaster, the Applicant has not demonstrated that any debris in the lakes poses an immediate threat.  Thus, the requested debris removal is ineligible.

     

    Letter: 

    February 6, 2015

    Kevin Davis
    Director
    Governor’s Office of Homeland Security and Emergency Preparedness
    7667 Independence Boulevard
    Baton Rouge, Louisiana 70806

    Re:  Second Appeal – Louisiana Department of Natural Resources, PA ID 000-UCPOY-00, FEMA-1603-DR-LA, Project Worksheet (PW) 20449, Direct Result of Disaster

    Dear Mr. Davis:

    This is in response to your letter dated June 4, 2014, which transmitted the referenced second appeal on behalf of the Louisiana Department of Natural Resources (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of funding for debris removal from Lake Lery and Lake Hermitage. 

    As explained in the enclosed analysis, I have determined that the Applicant did not establish that any debris in these two lakes is a direct result of the disaster, or that the debris poses an immediate threat to life, public health, or safety.  In accordance with Title 44 of the Code of Federal Regulations (C.F.R.) § 206.223(a)(1), eligible work must be required as a direct result of the disaster.  Therefore, I am denying this appeal.

    Please inform the Applicant of my decision.  This determination constitutes the final decision on this matter pursuant to 44 C.F.R. § 206.206 Appeals.  

    Sincerely,      

    /s/                             

    William W. Roche
    Director
    Public Assistance Division

    Enclosure

    cc:  George A. Robinson
           Regional Administrator
           FEMA Region VI

    Analysis: 

    Background

    On August 29, 2005, Hurricane Katrina struck the Gulf Coast and deposited debris in waterways throughout Louisiana.  In September 2006, FEMA executed an Intra-Agency Agreement (IAA) with the United States Coast Guard (USCG) to remove eligible marine debris.  The IAA scope of work provided that the USCG will perform removal of marine debris, including stranded vessels, wrecks, and debris that “pose an immediate threat to public health and safety, pose the potential for a hazard to navigation or directly impact the economy of the community at large, from the commercial waterways and navigable channels.” [1]

    The USCG removed debris from Lake Lery in St. Bernard Parish and Lake Hermitage in Plaquemines Parish.  Between December 2006 and April 2007, the USCG identified and removed 490 cubic yards (CY) of eligible debris from Lake Lery.[2]  In October 2008, USCG’s side-scan sonar surveys for Lake Lery identified additional potentially eligible debris targets.  However, the USCG could not locate the debris targets during subsequent removal operations; consequently, no debris was removed.[3]  In July 2009, the USCG removed a partially submerged vessel from a canal located on the western extent of Lake Hermitage.[4]

    On August 30, 2008, the USCG, FEMA, State of Louisiana, and St. Bernard Parish entered into a Memorandum of Agreement (Memorandum) stating that the USCG was authorized by FEMA to remove storm generated debris from commercial waterways in St. Bernard Parish.  The Memorandum also stated that “[d]ebris pickup is now greatly reduced and is at a rate of collection where the Parish resources can likely manage any further collection.”[5]  Representatives from the USCG, FEMA, and St. Bernard Parish signed the Memorandum. The Memorandum did not include a signature from a State of Louisiana representative.  On May 4, 2011, the same four entities entered into another Memorandum of Agreement, stating that the USCG was authorized to remove storm generated debris, and eligible debris was located and subsequently removed.  Signatures from all four entity representatives documented the completion of the FEMA debris removal mission in St. Bernard Parish as of February 1, 2011.[6]

    On August 8, 2012, the Louisiana Department of Natural Resources (Applicant) submitted a new Project Worksheet (PW) requesting Public Assistance (PA) Program funding for Hurricane Katrina-related debris removal from Lake Lery and Lake Hermitage, which have state-owned water bottoms that are the Applicant’s legal responsibility.  The Applicant stated that a new PW was necessary for the “identification, removal, and disposal of waterborne debris in Lake Lery and Lake Hermitage.”  The Applicant did not include any documentation with the PW request to establish that any debris existed.  FEMA prepared PW 20449 to address the Applicant’s request, and determined the requested work to be ineligible because the USCG had removed all Katrina-related debris that posed an immediate threat to life, public health and safety.  Subsequently, FEMA obligated PW 20449 for zero dollars on November 27, 2012.

    First Appeal

    On February 8, 2013, the Applicant submitted a first appeal to the Louisiana Governor’s Office of Homeland Security and Emergency Preparedness (Grantee).  In its appeal, the Applicant raised the following six issues:

    1. The water bottoms of Lake Lery and Lake Hermitage contained debris deposited by Hurricane Katrina.
    2. The debris removal from the lakes was eligible for Public Assistance pursuant to 44 C.F.R. §206.224.
    3. The USCG debris removal operation did not remove all eligible debris from the two lakes.
    4. The USCG was no longer actively performing debris removal in the two lakes.
    5. FEMA’s assertion—that the bathymetry of the two lakes made it difficult for the USCG to bring in debris removal equipment—was not a legally valid reason for an ineligibility determination of the Applicant’s own debris removal operation.
    6. The Applicant is entitled to Public Assistance for eligible debris removal.

    On January 8, 2014, the FEMA Region VI Regional Administrator (RA) denied the first appeal, determining that the requested debris removal from Lake Lery and Lake Hermitage was ineligible.  The RA asserted that, pursuant to 44 C.F.R. § 206.223(a)(1), eligible work must be required as a direct result of the disaster; in this case, the Applicant had not established the existence of any Hurricane Katrina related debris.  Further, the RA noted that the USCG’s extensive debris removal efforts included Lake Lery and Lake Hermitage.  The RA concluded that the Applicant’s claim did not meet the requirements for debris removal in accordance with 44 C.F.R. § 206.224.

    Second Appeal  

    In its second appeal, dated April 4, 2014, the Applicant requests a reconsideration of its first appeal.  To further support its first appeal assertions, the Applicant provides a draft trip report, which allegedly demonstrates the existence of debris in Lake Lery and Lake Hermitage, but not that the debris is directly related to Hurricane Katrina. 

    On June 4, 2014, the Grantee transmitted the Applicant’s second appeal, indicating its support of the appeal.  In addition to agreeing with the Applicant’s arguments, the Grantee suggests that it is not the Applicant’s sole responsibility to monitor and track the debris in the waterways.  The Grantee emphasizes that, from the beginning, the Applicant requested FEMA to locate and identify the debris in the waterway, in addition to the removal and disposal of this debris.  The Grantee also asserts that the Applicant may eventually be entitled to direct administrative costs. 

    Discussion

    Direct Result of Disaster

    In general, to be eligible for PA funding, the work must be required as a direct result of the disaster.[7]  If any debris meets this threshold requirement, then the debris removal may be eligible for funding when it is in the public interest, as set forth in  44 C.F.R. § 206.224(a).[8]

    The Applicant failed to establish that the debris was a direct result of Hurricane Katrina.  As evidence of the existence of debris in Lake Lery and Lake Hermitage, the Applicant provides a draft trip report, dated June 15, 2012, [9] and an email from a private citizen, dated April 6, 2012.[10]  According to the trip report, the Applicant’s field survey team found nine debris targets in Lake Lery and eight debris targets in Lake Hermitage.  The Lake Lery debris targets consisted mostly of trees and one “boat submerged near [the] bank.”[11]  The Lake Hermitage debris targets consisted of four “unknown” objects or items, with the remaining four items described as “fiberglass boat,” “tank on shore,” “loose piling,” and “iron pipes on bottom left by oil co. [o]lder than 50 years. . . [l]ikely not eligible for FEMA PA.”[12]   Notably absent from the trip report is any information related to the origin of the debris targets found.  Additionally, the email from the aforementioned private citizen conveys the message that he “recently returned to commercial crabbing in Lake Lery and discovered that it is littered with hurricane debris…that it is hazardous to navigation.”[13]  However, the information in the email is only one private citizen’s opinion that the debris is hurricane related, and does not directly support a connection between the encountered debris and the declared disaster.

    In addition, Hurricane Katrina made landfall in 2005, almost seven years prior to the debris sightings documented in the 2012 draft trip report.  Given the history of frequent hurricanes that impacted the Louisiana waterways before and after Hurricane Katrina,[14] it is very possible that the debris encountered and documented in the 2012 draft trip report resulted from an event prior to Hurricane Katrina.[15]  Alternatively, an event after Hurricane Katrina could have deposited the debris in the lakes.  Further, the Grantee admits in the second appeal transmittal that, “[w]aterway debris is most often, by its nature, not stationary; it is subject to the movement of the water in which it is located.”  Moreover, the USCG noted, following its unsuccessful attempt to locate and remove debris targets previously detected in a sonar survey, that the “[i]tem may have moved from original location since date of survey.”[16] These statements reveal the lack of certainty that the debris is a direct result of Hurricane Katrina.

    The Applicant attempted to document the existence of debris in the two lakes with the 2012 draft trip report.  However, this 2012 draft report, which identified alleged hurricane debris from an event seven years earlier, does not demonstrate that the identified items were the direct result of Hurricane Katrina.  Thus, the requested debris removal work is ineligible. 

    Immediate Threat

    Even if, arguendo, all of the debris in both Lake Lery and Lake Hermitage were a direct result of the disaster (Hurricane Katrina), the Applicant failed to demonstrate that the debris removal would be in the public interest, pursuant to 44 C.F.R. § 206.224(a).[17]   Debris removal, in this instance, is in the public interest when it is necessary to:

    1. Eliminate immediate threats to life, public health, and safety; or
    2. Eliminate immediate threats of significant damage to improved public or private property; or
    3. Ensure economic recovery of the affected community to the benefit of the community-at-large.[18]

    As of the date of the second appeal, more than nine years after the disaster, any threat posed by the debris in the lakes is not considered an immediate threat, which is defined as the threat of damage from an event that could reasonably occur within five years.[19]  Furthermore, the Applicant has not presented any argument nor provided any documentation to substantiate that the debris removal from the two lakes would ensure economic recovery of the affected community to the benefit of the community at large, in accordance with the requirement set forth in the regulations.[20]  Accordingly, the debris removal is not eligible for PA funding, pursuant to 44 C.F.R. § 206.224(a).

    Direct Administrative Costs

    The Applicant’s direct administrative costs (DAC), if incurred and properly documented, would only be eligible for funding if the associated work is eligible.  As the work in this instance is not eligible, further discussion of DAC is unnecessary. 

    Conclusion

    The Applicant did not establish that any debris in Lake Lery or Lake Hermitage is a direct result of Hurricane Katrina.  Further, the Applicant did not demonstrate that the debris removal work is in the public interest, in accordance with 44 C.F.R. § 206.224(a).[21]  Therefore, the requested debris removal from Lake Lery and Lake Hermitage is ineligible for PA funding.


    [1] Intra-Agency Agreement Between Federal Emergency Management Agency (FEMA) and the United States Army (sic) Coast Guard (USCG), at 7 (2006).

    [2] Phase II Marine Debris Removal, Lake Lery, Case 8418, USCG/FEMA, at 7 (Undated).

    [3] Waterway Subsurface Debris Target Evaluation Sheet, Lake Lery, Case 8428, Target 1003, 1004, 1005, and 1006, USCG (Oct. 1, 2008).

    [4] Memorandum from Mr. George E. Amon III (Office of Claims and Litigation, USCG) to Jeffery Jones (FEMA representative for Marine Debris Removal), U.S. Coast Guard/FEMA Marine Debris Removal Effort for Lake Lery and Lake Hermitage, at 2 (Undated).

    [5] Memorandum of Agreement Amoung (sic) U.S. Coast Guard, Federal Emergency Management Agency, State of Louisiana, St., Bernard Parish (Aug. 30, 2008)

    [6] Memorandum of Agreement Among U.S. Coast Guard, Federal Emergency Management Agency, State of Louisiana, St., Bernard Parish (May 4, 2011)

    [7] 44 C.F.R. § 206.223(a)(1) (2004). 

    [8] 44 C.F.R. § 206.224(a).

    [9] Lakes Hermitage and Lery Marine Debris Evaluation Trip Report, DRAFT, prepared by IEM, Inc. for Coastal Protection and Restoration Authority (CPRA) (June 15, 2012) [hereinafter “2012 Draft Trip Report”].

    [10] Email from Frederick Everhardt to Leo Richardson (April 6, 2012)  [hereinafter Email from Frederick Everhardt].

    [11] 2012 Trip Report.

    [12] Id.

    [13] Email from Frederick Everhardt.

    [14] List of Louisiana hurricanes (2000–present), Wikipedia, http://en.wikipedia.org/wiki/List_of_Louisiana_hurricanes_(2000%E2%80%93present) (last visited Dec. 9, 2014) (listing the following hurricanes: Isidore (2002), Lili (2002), Cindy (2005), Katrina (2005), Rita (2005), Gustav (2008), Lee (2011), and Isaac (2012)).

    [15] See 2012 Draft Trip Report (referencing iron pipes older than 50 year old, which suggests that debris encountered in the waterway is likely not caused by Hurricane Katrina).

    [16] Waterway Subsurface Debris Target Evaluation Sheet, Lake Lery, Case 8428, Target 1003, USCG (Oct. 1, 2008).

    [17] 44 C.F.R. § 206.224(a).

    [18] Id.

    [19] Public Assistance Guide, FEMA 322, at 50 (Oct. 1999) [hereinafter PA Guide].  FEMA notes that the Applicant stated in both the first and second appeal letters that “once the debris removal at issue has been determined to be eligible for public assistance, the project will be submitted to various contractors for public bid.”  If the debris in the two lakes truly posed an immediate threat, then the Applicant, as the legally responsible entity, could have performed the debris removal work regardless of PA eligibility.  The fact that the Applicant continues to wait for FEMA’s eligibility determination, more than nine years after the disaster, undermines the Applicant’s assertion that the debris poses an immediate threat.

    [20] 44 C.F.R. § 206.224(a)(3).

    [21] 44 C.F.R. § 206.224(a).


     

     

  • Equipment – Excessive Costs

    Appeal Type: 
    2nd
    Report Type: 
    PW
    Appeal Categories: 
    Applicant Name: 
    Snohomish County Public Utility District (PUD) No. 1
    Disaster Number: 
    1682-DR-WA
    DSR: 
    65
    Date Signed: 
    Friday, January 23, 2015
    PA ID: 
    061-01C00-00
    Summary/Brief: 

    Conclusion: Between the Applicant equipment rates and the FEMA equipment rates, the lower set of rates should be used to calculate the total equipment cost, instead of creating a new hybrid set of lower rates.

    Summary Paragraph

    The OIG conducted an audit of the Applicant’s projects related to a severe winter storm in 2006 and recommended disallowing $91,582.00 from PW 65 due to excessive force account equipment costs resulting from using the FEMA equipment rates.  FEMA concurred and de-obligated $91,582.00 from PW 65.  In its first appeal, the Applicant asserted that the locally established equipment rates do not reflect actual cost, and for this reason, the FEMA/State team advised using the FEMA equipment rates during PW preparation.  The Regional Administrator denied the first appeal because PW 65 included excessive equipment costs based on the higher FEMA equipment rates rather than the lower Applicant equipment rates.  In the second appeal, the Applicant reiterated the first appeal arguments.  FEMA obtained the OIG audit working documents, and found that the OIG’s recalculation of the total equipment cost using a hybrid set of the Applicant and FEMA equipment rates was not supported by a reasonable interpretation of FEMA regulations and policy.  FEMA has determined that the Applicant has provided sufficient documentation to certify that the locally established equipment rates do not reflect actual costs, and the use of the FEMA equipment rates was appropriate. 

    Authorities and Second Appeals

    • 44 C.F.R. § 206.228(a)(1)(ii) (2006).
    • PA Guide, at 38 (Oct 1999).

    Headnotes

    • 44 C.F.R. § 206.228(a)(1)(ii) provides that where local guidelines are used to establish equipment rates, reimbursement will be based on those rates or rates in a Schedule of Equipment Rates published by FEMA, whichever is lower.  If an applicant certifies that its locally established rates do not reflect actual costs, reimbursement may be based on the FEMA Schedule of Equipment Rates, but the applicant will be expected to provide documentation if requested.
    • The OIG audit finding of excessive equipment cost was based on the OIG calculation method of creating a new hybrid set of equipment rates consisting of the lower rate (between the Applicant and FEMA equipment rates) for each piece of equipment.  This hybrid method is not supported by FEMA’s interpretation of its regulation.
    • The Applicant certified that its locally established equipment rates do not reflect actual costs.  Therefore, the Applicant is eligible to receive reimbursement based on the FEMA equipment rates.
    • PA Guide also states that where local rates have been developed, reimbursement is based on the local rates or the FEMA rates, whichever is lower.  If the local rate is lower and the applicant certifies that the rates do not reflect all actual costs, the higher FEMA rates may be used.
    • The guidance does not support the use of hybrid equipment rates.  The Applicant is justified in receiving reimbursement based on the FEMA equipment rates, since it certified local rates do not reflect all actual costs.
    Letter: 

    January 23, 2015

    Robert Ezelle
    Director
    Washington Military Department Emergency Management Division
    20 Aviation Dr.
    Building 20, MS TA-20
    Camp Murray, Washington 98430

    Re:  Second Appeal – Snohomish County Public Utility District (PUD) No. 1, PA ID 061-01C00-00, FEMA-1682-DR-WA, Project Worksheet (PW) 65 – Equipment – Excessive Costs

    Dear Mr. Ezelle:

    This is in response to your office’s letter dated December 9, 2013, which transmitted the referenced second appeal on behalf of Snohomish County PUD No. 1 (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) de-obligation of $91,582.00 from PW 65 for equipment costs. 

    As explained in the enclosed analysis, I have determined that the reimbursement of the force account equipment cost should be based on the locally established equipment rates or the FEMA rates, whichever set of rates is lower.  Furthermore, the Applicant has provided sufficient documentation to certify that the locally established equipment rates do not reflect actual costs, justifying reimbursement based on the FEMA equipment rates.  Accordingly, I am granting this appeal in the amount of $91,582.00.  By copy of this letter, I am requesting that the Regional Administrator take appropriate action to implement this determination.

    Please inform the Applicant of my decision.  This determination is the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.

    Sincerely,

    /s/

    Alex Amparo
    Assistant Administrator
    Recovery Directorate

    Enclosure

    cc:  Kenneth Murphy
          Regional Administrator
          FEMA Region X

    Analysis: 

    Background

    During the severe winter storm incident period from December 14 to December 15, 2006, the utility system owned and operated by the Snohomish County Public Utility District No. 1 (Applicant) sustained a variety of storm-related damages.  FEMA obligated Project Worksheets (PWs) 45, 48, and 65 for approximately $5.6 million to repair the Applicant’s utility system damaged by the declared disaster.

    On June 19, 2009, the Department of Homeland Security Office of Inspector General (OIG) issued Audit Report Number DS-09-07 (Audit Report) based on an audit of the Applicant’s three PWs.  The Audit Report recommended disallowing a total of $286,533.00 for several reasons, including: lack of supporting documentation; unreasonable and ineligible costs; duplicate costs due to accounting errors; and ineligible public utility taxes paid to other applicants. 

    In particular, the Audit Report Finding B identified ineligible costs on PW 65[1], which was prepared using “FEMA’s standard equipment rates rather than using [the Applicant’s] lower rates for selected equipment items.”[2]   For each piece of force account equipment claimed on PW 65, the OIG compared the Applicant equipment rate with the FEMA equipment rate and selected the lower rate.  Using this hybrid method of selecting the lower of the two rates for each piece of equipment, the OIG recalculated the total force account equipment cost.  The difference between the recalculated total force account equipment cost and the original total force account equipment cost on PW 65 was $91,582.00, which the OIG recommended for disallowance as excessive equipment costs.

    FEMA concurred with the Audit Report Finding B and agreed to disallow $91,582.00 in excessive equipment costs from PW 65.  FEMA de-obligated this amount in June 2012.

    First Appeal

    On August 3, 2012, the Applicant submitted its first appeal request to the State of Washington Military Department Emergency Management Division (Grantee), appealing FEMA’s de-obligations on PWs 45 and 65 based on the OIG audit findings.  The Grantee transmitted the Applicant’s first appeal to Region X on October 1, 2012, indicating its support of the appeal.

    Regarding FEMA’s de-obligation of $91,582.00 from PW 65, the Applicant argued that its own equipment rates, while used internally between departments, do not reflect the actual cost to operate its equipment, nor do the rates incorporate the same cost components comprising the FEMA equipment rates.  For these reasons, the Applicant indicated it was directed by the FEMA-State team to use the FEMA equipment rates during the disaster kick-off meeting.  The Applicant further argued, FEMA continued to advise the Applicant to use the FEMA equipment rates during the three declared disasters following FEMA-1682-DR-WA.

    Along with the Applicant’s appeal request, the Grantee included its own analysis to provide additional details to support the Applicant’s appeal arguments.  First, the Grantee stated that the Applicant provided a written statement detailing the cost components and actual costs of the Applicant equipment rates.  Some of the cost components are the same between the Applicant and the FEMA equipment rates, including: depreciation; overhead; all maintenance; field repairs; fuel; lubricants; and tires.  However, while the Applicant equipment rate cost components include parts and material, labor, and professional services, the FEMA equipment rates cost components include OSHA equipment and incidental costs. 

    Next, the Grantee explained that the Applicant certified that its own equipment rates do not reflect actual costs, because its fleet management software only tracks operation hours for vehicles assigned to a specific work order in the system, and not any other support or maintenance vehicles necessary for the total equipment operation.  The Grantee asserted that the Applicant’s equipment rates do not reflect actual costs, because the software only monitors 221 out of 464 vehicles, with the remaining vehicle operation hours unaccounted for by the system.

    Finally, the Grantee stated that it was not provided a copy of the OIG’s working documents, and therefore could not determine how the recommended disallowance of $91,582.00 was calculated.  The Grantee presented its own analysis of the total equipment cost using two different methods.  This analysis showed that had the Applicant equipment rates been used instead of the FEMA equipment rates to formulate PW 65, the total equipment cost would have actually increased by $21,527.87. The analysis also indicated that if the calculation method utilized by the OIG had been used to select the lower of the Applicant or FEMA equipment rate for each piece of claimed force account equipment, the total equipment cost should have decreased by only $48,167.82, instead of $91,582.00 as determined by the OIG audit.

    The FEMA Region X Regional Administrator (RA) denied the first appeal on August 8, 2013.  The RA referenced 44 C.F.R. § 206.228(a)(1)(ii) which requires that where local rates are used to establish equipment rates, reimbursement will be based on those rates or the FEMA rates, whichever is lower.[3]  The RA stated that the Applicant semi-annually conducted rate adjustments for all fleet vehicles and could have set the local rates to reflect current operating costs.  The RA agreed with the OIG’s original finding that the Applicant inappropriately used the higher FEMA equipment rates than the lower local rates, justifying the de-obligation based on the OIG audit.

    Second Appeal

    On December 9, 2013, the Grantee transmitted and positively endorsed the Applicant’s second appeal letter dated October 4, 2013.  The second appeal reiterated the Applicant’s first appeal argument pertaining to only PW 65. 

    The Grantee again included its own analysis to support the Applicant’s position, presenting the same arguments provided with the first appeal.

    Discussion

    Title 44 Code of Federal Regulation (44 C.F.R.) § 206.228(a)(1)(ii) states: “[w]here local guidelines are used to establish equipment rates, reimbursement will be based on those rates or rates in a Schedule of Equipment Rates published by FEMA, whichever is lower.”[4] (emphasis added). 

    FEMA interprets the use of the plural noun “rates” in the regulations[5] as an indication that the regulatory intent is for FEMA to select one set of rates over another set of rates between the Applicant equipment rates and the FEMA equipment rates.  Public Assistance guidance further clarifies that “[w]here local rates have been developed, reimbursement is based on the local rates or FEMA’s rates, whichever is lower.[6]

    As such, FEMA regulations and guidance support the use of either the applicant’s equipment rates or the FEMA equipment rates, whichever set of equipment rates is lower.[7]  FEMA regulations also provide that if an applicant certifies that the locally established rates do not reflect actual costs, reimbursement may be based on the FEMA Schedule of Equipment Rates, but the applicant will be expected to provide documentation if requested.[8]

    The Applicant informed FEMA and the Grantee at the time of PW preparation in 2007 that the locally established equipment rates did not reflect actual costs.  Accordingly, the Applicant was advised to use the FEMA equipment rates to calculate the total force account equipment cost on PW 65.  The Applicant also provided a written statement detailing the components of the locally established equipment rates, certified that they do not reflect actual cost, and provided the necessary justification for requesting reimbursement based on the FEMA equipment rates.

    As part of the audit, the OIG recalculated the total force account equipment cost on PW 65 by selecting the lower rate between the Applicant equipment rate and the FEMA equipment rate for each piece of equipment, effectively creating a hybrid set of both equipment rates.  Although the intent of this method was to ensure FEMA reimbursement based on the lowest possible total equipment cost, the hybrid approach to calculate the total equipment cost is neither practical to implement in every PW preparation scenario, nor supported by FEMA’s interpretation of its regulations and guidelines regarding equipment rates.[9]

    Conclusion

    FEMA has determined that the reimbursement of the force account equipment cost should be based on the locally established equipment rates or the FEMA rates, whichever set of rates is lower, instead of creating a new hybrid set of lower rates.  Furthermore, the Applicant has provided sufficient documentation to certify that the locally established equipment rates do not reflect actual costs, in order to receive reimbursement based on the FEMA equipment rates in accordance with FEMA regulations and policy.  Therefore, the reimbursement of the Applicant’s total equipment cost on PW 65 should be based on the FEMA equipment rates.  As such, reobligation of $91,582.00 is appropriate.                                                              


    [1] The Second Appeal Analysis discusses only relevant details pertaining to PW 65 because the Applicant’s second appeal only addresses PW 65.

    [2] Memorandum from OIG to FEMA regarding Audit Report Number DS-09-07 (June 19, 2009).

    [3] 44 C.F.R. § 206.228(a)(1)(ii) (2006).

    [4] Id.

    [5] 44 C.F.R. § 206.228(a)(1)(ii).

    [6] PA Guide, FEMA 322, at 38 (Oct 1999).

    [7] See id. See also 44 C.F.R. § 206.228(a)(1)(ii).

    [8] See 44 C.F.R. § 206.228(a)(1)(ii).

    [9] See id.

     

  • Direct Result of Disaster

    Appeal Type: 
    2nd
    Report Type: 
    PW
    Applicant Name: 
    Louisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans
    Disaster Number: 
    1603-DR-LA
    DSR: 
    20644
    Date Signed: 
    Wednesday, January 28, 2015
    PA ID: 
    000-UURAV-00
    Summary/Brief: 

    Conclusion: The contract security services performed at Charity Hospital from August 2010 to June 2012 are neither work required as a direct result of a disaster as required by 44 C.F.R. § 206.223(a), nor an eligible emergency protective measure as defined by 44 C.F.R. § 206.225(a).

    Summary Paragraph

    In August 2005, Hurricane Katrina caused extensive damage to Charity Hospital, which was closed immediately following the storm and has since remained closed.  From August 2010 to June 2012, the Applicant secured the building contents by utilizing contract security services consisting of foot and mobile patrol officers around the vacant building, for a total cost of $592,920.32.  FEMA prepared PW 20644 for zero dollars for this work, finding that the security services did not constitute an eligible emergency protective measure.  In its first appeal, the Applicant argued that FEMA requested that the building contents be secured until the valuation process was completed.  The Applicant also stated that the valuation process was not completed until December 2012.  Upon review, the Regional Administrator denied the first appeal based on the finding that the security services provided five to seven years after the disaster did not meet eligibility requirements of an emergency protective measure.  In its second appeal, the Applicant requests reconsideration, claiming that the security services were necessary to avoid damage resulting from theft and vandalism, as well as to protect the public from exposure to any dangerous material within the hospital. 

    Authorities and Second Appeals

    • Stafford Act § 403
    • 44 C.F.R. § 206.223(a).
    • 44 C.F.R. § 206.223(e).
    • 44 C.F.R. § 206.225(a)(1).
    • 44 C.F.R. § 206.225(a)(3).
    • PA Guide, at 23 (Oct. 1999).
    • PA Guide, at 50.

    Headnotes

    • 44 C.F.R. § 206.223(a) states that to be eligible for financial assistance, an item of work must be required as the result of the major disaster.  The PA Guide specifies that work must be required as a direct result of the declared disaster.
    • The contract security services were performed to avoid theft and vandalism, and other potential consequences of such criminal acts five to seven years after the event.  This work was not required as a direct result of the major disaster; therefore, the work is ineligible for financial assistance.
    • 44 C.F.R. § 206.225(a)(1) provides that emergency protective measures to save lives, to protect public health and safety, and to protect improved property are eligible.  44 C.F.R. § 206.225(a)(3) further provides that eligible emergency protective measures must: (i) eliminate or lessen immediate threats to life, public health or safety; or (ii) eliminate or lessen immediate threats of significant additional damage to improved public or private property through measures which are cost effective.
      • The contract security services provided five to seven years after the disaster did not serve to eliminate or lessen any immediate threat.
      • The contract security services were performed to avoid theft or vandalism, which are not considered an immediate threat from a hurricane disaster event.

     

    Letter: 

    January 28, 2015

    Kevin Davis
    Director
    Governor’s Office of Homeland Security and Emergency Preparedness
    7667 Independence Boulevard
    Baton Rouge, Louisiana 70806

    Re:  Second Appeal – Louisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans, PA ID 000-UURAV-00, FEMA-1603-DR-LA, Project Worksheet (PW) 20644

    Dear Mr. Davis:

    This is in response to your letter dated May 13, 2014, which transmitted the referenced second appeal on behalf of Louisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of $592,920.32 in funding for contract security services at Charity Hospital. 

    As explained in the enclosed analysis, I have determined that the contract security services provided at Charity Hospital five to seven years after Hurricane Katrina are not work required as a direct result of a disaster, nor are they an eligible emergency protective measure.  Therefore, I am denying this appeal. 

    Please inform the Applicant of my decision.  This determination constitutes the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.

    Sincerely,

    /s/

    William W. Roche
    Director
    Public Assistance Division

    Enclosure

    cc:  George A. Robinson
           Regional Administrator
           FEMA Region VI

    Analysis: 

    Background

    On August 29, 2005, heavy rains and wind from Hurricane Katrina caused significant damage to Charity Hospital located in New Orleans, Louisiana. The hospital was closed immediately following the storm and has since remained closed.  The State of Louisiana, Facility Planning and Control (FP&C) was legally responsible for the hospital building facility, while Louisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans (LSU HCSD MCLNO or Applicant), had legal responsibility for the day-to-day operation of the hospital and all its contents and equipment, except permanently fixed equipment.

    On November 21, 2008, the US Department of Veterans Affairs, FEMA, the City of New Orleans, the Louisiana State Historic Preservation Officer, and the Advisory Council on Historic Preservation entered into a programmatic agreement to minimize adverse effects to historic properties affected by decisions to repair or replace certain historical New Orleans medical facilities, including Charity Hospital, pursuant to Section 106 of the National Historic Preservation Act (NHPA).[1]  According to the agreement, FP&C performed “secure and ventilate” asset protective measures to secure the hospital facility and preserve character-defining historic building features from deterioration or damage.  Security measures performed included the following: securing windows with rolling shutter doors to prevent access; securing strategic doors to prevent unauthorized entry into the building; installing access lighting throughout the facility including the basement, corridors, and mechanical areas; and installing a 6-foot chain link fence with barbed wire around the facility perimeter. FEMA subsequently provided over $3.9 million in Public Assistance (PA) funding for this work in Project Worksheet (PW) 19731.[2]

    In January 2010, Charity Hospital was deemed eligible for replacement.  Subsequently, FEMA determined that all building contents on all 20 floors of Charity Hospital were completely damaged, with the exception of a small quantity of items removed from the hospital following Hurricane Katrina for use at temporary facilities.[3]  The costs associated with the proper removal and disposal of all damaged building contents were provided in PW 20370.[4]

    On April 27, 2012, the Applicant requested a new Category B PW for emergency work to provide security services at Charity Hospital.  The Applicant submitted invoices for contract security services procured between August 6, 2010 and June 7, 2012, for a total amount of $592,920.32.  Security services consisted of one foot patrol officer at all times, one mobile patrol officer during nights and weekends, and one lead officer during the regular work week.

    On March 13, 2013, FEMA obligated PW 20644 for zero dollars, because the security services did not meet emergency work requirements as defined by Title 44 of the Code of Federal Regulations (C.F.R.) Section 206.225.[5]  FEMA determined that the timeframe of the security services—five to seven years after the declared disaster—did not demonstrate an immediate need necessary for emergency work and that security was provided mainly to prevent theft or vandalism, which were not considered disaster-related damage.  FEMA noted that FP&C had already completed its “secure and ventilate” project, which consisted of passive security measures to prevent further damage from environmental conditions and vandalism.  Finally, FEMA found that the time period of the security services did not overlap or end concurrently with the intended schedule for sorting and disposing of the building contents, which started in January 2013.

    First Appeal

    On March 23, 2013, the Applicant submitted its first appeal to the Grantee, requesting that FEMA obligate the $592,940.32 denied on PW 20644.  The Grantee transmitted the Applicant’s first appeal to FEMA Region VI, indicating its support of the appeal, on June 10, 2013.  As a basis for the appeal, the Applicant claimed that FEMA requested that the hospital building be secured so that no assets would be destroyed or removed until a thorough review had been completed.  The Applicant contended that the valuation process was not finalized until December 2012.

    The FEMA Region VI Regional Administrator (RA) denied the first appeal on January 2, 2014.  The RA determined that the security services did not meet eligibility requirements to be considered an eligible emergency protective measure in accordance with 44 C.F.R. §206.225.[6]  The RA stated that the security services provided approximately five to seven years after the disaster did not serve to eliminate or reduce any immediate threats.  Additionally, the RA noted that FP&C had previously rendered the facility secure.

    Second Appeal

    On May 13, 2014, the Grantee transmitted the Applicant’s second appeal letter dated March 1, 2014, indicating its support of the appeal.  In the second appeal, the Applicant reiterated its request for reconsideration of the denied funding for contract security services provided at Charity Hospital in the amount of $592,940.32. 

    The Applicant asserts that the passive security measures in place (as performed by FP&C), such as securing windows/doors and installing lights/fences with barbed wire around the facility perimeter, are not sufficient to completely prevent crime, remove vagrants, or deter future damage to the exterior, interior, or assets of a historic site such as Charity Hospital.  The Applicant further explains that, based on the type of structure (a historic site), the geographical location (a crime-ridden area), the numerous previous attempts of theft, loss, vagrancy, unauthorized entry, and threats to entry, a fence is not sufficient to completely secure the facility.  The Applicant also claims that the contract security personnel have removed vagrants, persons attempting to steal copper, and persons attempting to cause structure damages to the historic site. 

    The Grantee supports the Applicant’s arguments and elaborates that while the hospital stood empty, security was necessary to safeguard the property and the costly medical equipment and supplies left behind.  According to the Grantee, the Applicant believed that if it had not secured the equipment and the building contents and they got further damaged, FEMA could have considered it negligence and ineligible for reimbursement.  Finally, the Grantee claims that failure to protect and safeguard the building contents could have jeopardized the public’s safety by potentially exposing the public to various biohazards and/or dangerous equipment located inside the hospital.

    Discussion

    Direct Result of Disaster

    Section 403 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) authorizes FEMA to provide assistance essential to meeting immediate threats to life and property resulting from a major disaster, including reduction of immediate threats to life, property, and public health and safety.[7]  Further, 44 C.F.R. § 206.223(a)(1) provides that an item of work must be required as the result of the major disaster event to be eligible for financial assistance.  Additionally, the Public Assistance Guide specifies that work must be required as a direct result of the declared disaster.[8]

    In this case, the security services provided were not work required as a direct result of the declared disaster.  Here, Hurricane Katrina caused property damage, requiring Charity Hospital to be closed. The closure increased the hospital’s exposure to potential threats of theft and vandalism.  While FEMA does not dispute that theft and vandalism may present risks to the hospital facility and its contents, these risks, especially five to seven years after the event, are not direct results of the disaster.  Rather, they are ordinary risks of crime that would typically be present both before and after a disaster such as Hurricane Katrina.  Accordingly, because the declared disaster, in itself, did not directly cause theft or vandalism, or any threat thereof, the security provided to prevent theft and vandalism was not work required as a direct result of the declared disaster.  Thus, it is ineligible for PA funding.  

    The Applicant also argues that security was provided not only to guard the hospital against theft and vandalism, but also to ensure public safety against potential exposure to various biohazards and dangerous equipment located inside the hospital.  However, the threat of such potential exposure to the general public at large was not a direct result of the disaster.  The potential threat would have materialized only upon unlawful access and use of the biohazards and dangerous equipment.  This would be considered a direct result of a criminal act independent of the disaster.  Therefore, any security provided to ensure public safety against potential threats from a criminal act was not eligible work required as a direct result of the disaster.

    Emergency Protective Measures

    Pursuant to 44 C.F.R. § 206.225(a)(1), emergency protective measures performed to save lives, to protect public health and safety, and to protect improved property are eligible.  The regulations further provide that eligible emergency protective measures must eliminate or lessen immediate threats to life, public health or safety, or eliminate or lessen immediate threats of significant additional damage to improved public or private property through cost-effective measures.[9]

    The PA Guide defines the term an “immediate threat” as the threat of damage from an event that could reasonably occur within 5 years.[10]  Immediate threat from a hurricane event, such as Hurricane Katrina, may be a 5-year flooding event that could cause damage or threaten lives, public health, and safety.[11]  Accordingly, emergency protective measures performed to eliminate or lessen such immediate threats (e.g., temporarily covering a wind-damaged roof with a tarp) would be eligible. However, threats of theft, vandalism, or any public exposure to hazardous materials resulting from criminal acts more than five years after the event are not immediate threats as defined by the PA Guide.  As such, because the security services performed did not eliminate or lessen an immediate threat, as described in the PA Guide, they are ineligible for PA funding.

    Furthermore, the Applicant believed that the security services were necessary to avoid any potential negligence on its part that may have resulted from failure to adequately secure the hospital building contents before inventory and valuation were completed.  FEMA agrees that avoiding negligence is a valid concern, as, pursuant to 44 C.F.R. §206.223(e), no assistance would be provided to an applicant for damages caused by its own negligence.[12]  Nevertheless, in this case, the security services did not address an immediate threat, as defined by FEMA guidelines.  FEMA notes that the FP&C secure and ventilate project was intended to prevent further damage to the hospital building (FP&C’s legal responsibility) and also served to protect the building contents (Applicant’s legal responsibility) by restricting access to the building itself.  Consequently, issues associated with theft and vandalism that might have been present in the immediate aftermath of Hurricane Katrina would have been addressed by that project.  Any additional security services procured by the Applicant were not eligible emergency protective measures as outlined in regulations and guidelines.[13]  As such, the work is ineligible for PA funding.

    Reasonable Cost

    In the second appeal, the Grantee asserted that the Applicant provided sufficient justification that the security services were provided at reasonable cost.  However, as the work itself is not eligible, FEMA will not determine whether the costs were reasonable.

    Conclusion

    The contract security services performed at Charity Hospital from August 2010 to June 2012 are neither work required as a direct result of a disaster, nor an eligible emergency protective measure.  Therefore, the work is ineligible for PA funding.  


    [1] See Programmatic Agreement among the US Department of Veterans Affairs, the Federal Emergency Management Agency, the City of New Orleans, the Louisiana State Historic Preservation Officer, and the Advisory Council on Historic Preservation Regarding the Funding to Repair or Replace Healthcare Facilities Comprising the VA Medical Center and the Medical Center of Louisiana at New Orleans (Nov. 21, 2008).

    [2] Project Worksheet 19731, Facility Planning and Control, State of Louisiana, Version 0 (Oct. 6, 2011).

    [3] Project Worksheet 20370, LSU HCSD MCLNO, Version 0 (Oct. 15, 2012).

    [4] Id.

    [5] See 44 C.F.R. §206.225 (2004)

    [6] See 44 C.F.R. §206.225.

    [7] The Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1988, Pub. L. No. 93-288, §403, 42 U.S.C. § 5170b (1988).

    [8] Public Assistance Guide, FEMA 322, at 23 (Oct. 1999) [hereinafter PA Guide].

    [9] 44 C.F.R. § 206.225(a)(3).

    [10]PA Guide, at 50.

    [11] See PA Guide, at 50 (stating that “[f]or a flood, the immediate threat exist if a 5-year flooding event could cause damage or threaten lives, public health, and safety.  This is not a flood that necessarily happens within 5 years, but a flood that has a 20 percent chance of occurring in any given year.”).

    [12] 44 C.F.R. § 206.223(e).

    [13] See 44 C.F.R. § 206.225(a); see also PA Guide, at 50.

     

  • Debris Removal – Construction and Demolition

    Appeal Type: 
    2nd
    Report Type: 
    PW
    Appeal Categories: 
    Applicant Name: 
    Plaquemines Parish
    Disaster Number: 
    1603-DR-LA
    DSR: 
    1645, 13495, and 13611
    Date Signed: 
    Thursday, January 22, 2015
    PA ID: 
    075-99075-00
    Summary/Brief: 

    Conclusion: Funding for demolition of commercial property is not eligible because the applicant did not obtain written approval from FEMA as required by FEMA policy prior to the demolition.    

    Summary Paragraph

    Following Hurricane Katrina, FEMA obligated $23.5 million in three Project Worksheets (PWs) to fund debris removal and demolition of public and private properties throughout Plaquemines Parish.  In response to an Office of Inspector General audit, FEMA deobligated a total of $440,824.55 from the three PWs for the demolition of 39 commercial properties found to be ineligible because the Applicant performed the work without FEMA approval. In the first appeals, the Applicant asserted that it requested and obtained prior approval for demolitions at the 39 commercial sites as demonstrated by the sites being recorded in FEMA’s private property debris removal (PPDR) property and debris matrix, a spreadsheet used to track debris removal activities within the parish.  The Region VI Regional Administrator denied the first appeals citing the Applicant’s failure to request and obtain written Federal Coordinating Officer (FCO) approval for the commercial demolition and debris removal activities as required by FEMA Recovery Policy RP9523.13 Debris Removal from Private Property (Oct. 23, 2005).  In its second appeals, the Applicant reiterates its position from the first appels.

    Authorities and Second Appeals

    • RP9523.13, Debris Removal from Private Property, at 2-4 (Oct. 23, 2005).

    Headnotes

    • Recovery Policy RP9523.13 Debris Removal from Private Property (Oct. 23, 2005), Section 7.C. states that any State or local government that intends to remove debris from private property must, prior to commencement of work, submit a written request to the Federal Coordinating Officer (FCO) seeking approval for reimbursement. Section 7.H. states that work may commence after receiving written approval from the FCO.
      • The Applicant did not receive written approval from the FCO.
    • Section 7.D. of the policy details specific factors to be considered by the FCO in making an eligibility determination relative to removal of debris from private commercial property.
      • The Applicant has provided no documentation to support that FEMA conducted the programmatic review required by Section 7.D.


     

    Letter: 

    January 22, 2015

    Kevin Davis
    Director
    Governor’s Office of Homeland Security and Emergency Preparedness
    7667 Independence Boulevard
    Baton Rouge, Louisiana 70806

    Re:  Second Appeal – Plaquemines Parish, PA ID 075-99075-00, FEMA-1603-DR-LA, Project Worksheets (PWs) 1645, 13495, and 13611, Debris Removal – Construction and Demolition

    Dear Mr. Davis:

    This letter is in response to your three letters dated July 11, 2013, which transmitted the referenced second appeals on behalf of Plaquemines Parish (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of funding in the amount of $440,824.55 for commercial property demolition and the associated debris removal.

    As explained in the enclosed analysis, I have determined that the Applicant failed to demonstrate it had obtained written approval from FEMA, as required by FEMA policy, prior to commencing the commercial property demolition.  Accordingly, I am denying this appeal. 

    Please inform the Applicant of my decision.  This determination is the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.

    Sincerely,

    /s/

    William W. Roche
    Director
    Public Assistance Division

    Enclosure

    cc:  George A. Robinson
           Regional Administrator
           FEMA Region VI

    Analysis: 

    Background

    On August 29, 2005, Hurricane Katrina caused tidal surge and flooding damage to public and private property throughout Plaquemines Parish (Applicant) resulting in an immediate threat to public health, safety, and welfare.  FEMA prepared Project Worksheets (PWs) 1645, 13495, and 13611 to fund debris removal and demolition of public and private properties throughout the Parish and obligated approximately $23.5 million in the three PWs.

    The Office of Inspector General (OIG) issued an audit report dated December 19, 2008, recommending that FEMA disallow certain costs claimed by the Applicant for demolition and debris removal activities at 245 commercial properties because the Applicant failed to obtain prior approval for the work from FEMA.  FEMA reviewed the OIG’s report and agreed that the Applicant had failed to obtain prior approval for demolition of 39 commercial properties listed on PWs 1645, 13495, and 13611.  FEMA disagreed with the OIG on the other sites questioned within the report, finding that the Applicant removed commercial debris from the right of way, which it did have approval to do by FEMA. 

    During the evaluation of the OIG audit, FEMA determined that the Applicant’s debris contractor had not documented the quantity of debris removed or actual cost for the specific demolitions.  In absence of actual costs, FEMA re-visited the sites of the 39 properties and developed an estimate of the debris quantities that would have been generated by the property demolitions.  FEMA also estimated the haul distances.  FEMA applied the actual contract unit cost to the estimated debris quantities and included estimated costs for debris hauling to estimate the costs associated with demolition and debris removal at the 39 sites.  In April 2011, FEMA prepared versions to all three PWs deobligating a total of $440,824.55 for the demolition of 39 commercial properties.

    First Appeals

    On July 2 and 9, 2012, the Applicant submitted three first appeals to the State of Louisiana Governor’s Office of Homeland Security and Emergency Preparedness (Grantee) for the deobligations associated with the ineligible commercial demolition and debris removal in PWs 1645, 13495, and 13611.  The Grantee transmitted the appeal letters to FEMA through letters dated September 7, 2012.

    In the appeals, the Applicant asserted that it requested prior approval for demolitions at the 39 commercial sites as demonstrated by the sites being recorded in FEMA’s private property debris removal (PPDR) property and debris matrix, a spreadsheet used to track debris removal activities within the parish.  Although there is no evidence FEMA provided approval of these demolitions, the Applicant claimed the inclusion of these properties on this FEMA produced document indicates that FEMA did recognize the submission of these properties for demolition and requested that FEMA use its authority to approve the demolition of these properties.

    The Applicant also disagreed with FEMA’s method of calculating the deobligation amount, stating FEMA’s use of the maximum contract debris hauling distance for each of the sites does not accurately reflect the actual distance for each site nor does it account for the actual cost of the demolition, which it claims to be approximately $5000 per property.  The Applicant requested that if FEMA continued to find the demolition of the commercial structures ineligible, then FEMA should reevaluate its calculations used to deobligate funding to the actual cost of the demolitions.  Deobligated funding would include either the cost of the demolitions on a per property basis or actual distance the debris was hauled based on the contract rate for debris hauling.

    On March 18, 2013, the FEMA Region VI Regional Administrator (RA) denied the three appeals citing the Applicant’s failure to request and obtain written Federal Coordinating Officer (FCO) approval for the commercial demolition and debris removal activities as required by FEMA Recovery Policy RP9523.13 Debris Removal from Private Property dated October 23, 2005.  The RA also determined that FEMA utilized the best information available to determine the costs associated with the commercial demolitions in each PW.

    Second Appeals

    On May 28, 2013, the Applicant submitted three second appeals of the deobligation of funding for commercial demolition of 39 properties and the associated debris removal in PWs 1645, 13495, and 13611, which the Grantee transmitted to FEMA in letters dated July 11, 2013. 

    In the second appeals, the Applicant asserts that FEMA approved the demolition and debris removal at the commercial sites both verbally and through email, although neither claim can be supported with written documentation.  The Applicant reiterates that FEMA granted prior approval for the demolitions through its use of its PPDR property and debris tracking matrix.

    Alternatively, the Applicant asserts that FEMA incorrectly based its eligibility determination on FEMA Recovery Policy RP9523.13 Debris Removal from Private Property dated October 23, 2005.  Rather it claims FEMA Response and Recovery Policy 9523.4 Demolition of Private Structures dated November 9, 1999, is the applicable policy for this work.  This policy did not explicitly state prior, written approval from the FCO was required for commercial structure demolition to be eligible.  The Applicant also requests that if FEMA continues to find the demolition costs ineligible then the debris removal costs at the sites should be found eligible and reinstated considering the FCO approved PPDR for the Parish.

    On March 10, 2014, FEMA held a meeting with the Applicant representative and the Grantee.  The Applicant reiterated several assertions it made in its second appeal primarily that the FEMA FCO was aware of and approved the demolition of the commercial properties.  The Applicant also provided emails transmitted between its representatives and FEMA.  Additional documentation submitted by the Applicant in support of its appeal includes its Demolition Operations Plan, the PPDR property and debris tracking matrix, and complete files for each property included on the matrix.

    Discussion

    Private property debris removal is generally not eligible for reimbursement under the Public Assistance program.  However, after the catastrophic impact of Hurricane Katrina, FEMA determined that it was in the public’s interest to remove debris from private property in certain impacted areas, including Plaquemines Parish as documented in FEMA Disaster Specific Guidance DSG #3, Hurricane Katrina Private Property Debris Removal in Coastal Areas dated September 10, 2005 (DSG #3 memo).  FEMA issued the DSG #3 memo to clarify procedures that are to be followed by each Joint Field Office (JFO) for application of Recovery Policy Number 9523.13 Debris Removal from Private Property, issued September 7, 2005, for removal of debris from private property in certain areas.”[1]  FEMA updated the policy on October 23, 2005. 

    Recovery Policy 9523.13 Debris Removal from Private Property dated October 23, 2005, refers to “debris removal” as the act of debris removal and disposal, including the demolition of unsafe structures when necessary from private property.[2]  Sections 7.C and 7.H require the applicant to submit a written request to the FCO seeking approval for reimbursement prior to commencement of work and inform the applicant that work may begin only after receiving approval from the FCO.[3]   Further, the policy in Section 7.D includes specific requirements for authorizing commercial property debris removal in addition to the requirements for other private property debris removal. The policy states: 

    When deciding whether to authorize the removal of debris from private commercial property, the FCO should determine if it is necessary to: eliminate an immediate threat to life, public health, safety or significant damage to improved property, 44 CFR § 206.224(a)(1) and (a)(2); or ensure economic recovery of the affected community to the benefit of the community-at-large, 44 CFR § 206.224(a)(3).[4]

    The policy follows with a list of factors to be considered by the FCO in making determinations relative to debris removal from commercial property.

    Further, FEMA issued a letter dated December 2, 2005 to the Grantee stating that FEMA concurred with the “procedure and record-keeping process set forth” in the Applicant’s Demolition Operations Plan.[5]  The letter also states “[p]lease note that demolition of structures for which there is no record of appropriate programmatic, environmental, and historic review, may not be eligible for reimbursement.”[6]  The documentation submitted by the Applicant supports the Applicant’s claim that it worked closely with FEMA to fulfill the requirements to satisfy eligibility requirements for PPDR.  However, the Applicant was required to request and obtain prior approval by the FCO for the demolition of commercial property, and the Applicant has provided no documentation to support its claim that it received the FCO’s approval.

    Applicable FEMA Policy

    The Grantee and Applicant both assert that FEMA is incorrectly using FEMA Recovery Policy RP9523.13 Debris Removal from Private Property dated October 23, 2005 and that FEMA Response and Recovery Policy 9523.4 Demolition of Private Structures dated November 9, 1999, is the more applicable policy.  As stated above, RP9523.13 refers to “debris removal” as the act of debris removal and disposal, including the demolition of unsafe structures.  Therefore, RP9523.13 is the policy applicable to the issue under appeal.  

    Ineligible Costs

    The Applicant has requested FEMA restore the costs of the debris removal portion of the work associated with the commercial demolitions if the demolitions themselves are still found to be ineligible.  Debris generated by demolition of commercial property found to be ineligible is also not eligible for funding, because, without having the opportunity to evaluate and determine that the demolition of the commercial property itself was required to eliminate an immediate threat or to ensure economic recovery, FEMA cannot find that the removal of the debris generated by the demolition was required to eliminate an immediate threat.

    Conclusion

    The guidance in place at the time the Applicant performed the work required FCO written approval to consider commercial property demolition eligible for funding. The Applicant did not obtain prior FEMA approval for the demolition and debris disposal for the 39 commercial structures as required by FEMA Recovery Policy RP9523.13 Debris Removal from Private Property dated October 23, 2005.  Accordingly, the demolition and associated debris removal of those properties is not eligible for funding.


    [1] Disaster Assistance Memorandum #3 explains that, with its issuance, FEMA determined that the requirements contained in paragraph 7.A of RP9523.13 were thereby satisfied. However, the memorandum also explains that “[t]he requirement for the establishment of the applicant's legal authority in paragraphs 7.B, C, and D must still be satisfied, although the process may be abbreviated. ”

    [2] Recovery Policy RP9523.13, Debris Removal from Private Property, at 1 (Oct. 23, 2005).

    [3] Id. at 2, 4.

    [4] Id. at 3.

    [5] Letter from Deputy Federal Coordinating Officer, FEMA, to Governor’s Authorized Representative, State of Louisiana Office of Homeland Security and Emergency Preparedness (Dec. 2, 2005).

    [6] Id.