Citation: FEMA-1093-DR-PA, SEDA-COG Joint Rail Authority; Various DSRs
Cross Reference: Permanent repair of railroad facilities, legal responsibility
Summary: The SEDA-COG Joint Rail Authority (subgrantee) was established by the Commonwealth of Pennsylvania as a public entity that owns railroad tracks and related facilities. As a result of flooding in January of 1996, several sections of the Nittany and Bald Eagle Railroad were damaged. The damages included washouts of tracks, culverts, and bridges; deposition of debris in ditches and culverts; and signal box destruction. The repairs were estimated at a cost of $103,243. All of the Damage Survey Reports (DSRs) prepared for this work were determined to be ineligible because the subgrantee did not have legal responsibility for the repairs according to a review of the Operating Agreement (Agreement) between the subgrantee and the Nittany and Bald Eagle Railroad Company (Operator). For the first appeal, dated May 15, 1997, the subgrantee stated that the "force majure" clause in the Agreement released the Operator from the responsibility of repairing the railroad facilities. The Regional Director denied the appeal, with a July 14, 1997, letter because the "force majure" clause did not indicate that the Subgrantee was assigned the legal responsibility for the repairs following the flood disaster. Additionally, it was noted that the Agreement was not valid. The subgrantee submitted a second appeal of this determination, with information to support its position.
Is the Agreement valid?
Does the Agreement give the legal responsibility of the repairs to the subgrantee?
Has the subgrantee demonstrated a history of payment (responsibility) for repairs to the railroad facilities?
No, the Agreement commenced seven months after the disaster declaration date and it was not signed by either party; therefore, the Agreement was not in effect at the time of the disaster.
No, the "force majure" clause does not exclusively state that the subgrantee is responsible for repairs resulting in events such as floods, which are the normal requirements of the Operator.
No, the subgrantee has not set precedence for funding repairs. The only instance of such an action was for the October 1996 when the subgrantee funded fifty-percent of the repair of damage.
Rationale: In accordance with 44 CFR 206.223, to be eligible the work must be the legal responsibility of the subgrantee. The Agreement between the subgrantee and the Operator does not assign specific responsibility to the subgrantee for the repairs. Additionally, the Agreement is not valid due to the factors explained above.