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Second Appeal Summary
PA ID# 087-90114; VILLA DEL MONTE MUTUAL WATER COMPANY
DSR ID# 34154/06120/83697/05020, 26644/05047, 74; Montevina Pipeline Connection
Citation: FEMA-845-DR-CA, PA 087-90114, Villa Del Monte Mutual Water Company, DSRs 34154/06120/83697/05020, 26644/05047, 74737/38984, 26642, Montevina Pipeline Connection
Cross-reference: Project Delay Costs, Improved Project, Project Management, Closeout
Summary: The Loma Prieta earthquake compromised the water supply of the residents served by the Villa Del Monte Mutual Water Company (Villa). After determining that repairing wells and the surface water supply was not feasible, Villa decided to connect to the existing Montevina Pipeline. FEMA approved DSR 34164 for this purpose on April 16, 1992. In August 1993, Villa requested additional items of work and funding for the project. FEMA approved some of these items and prepared supplemental DSR 06120. A series of delays prolonged the construction for years. In June 1995, Villa requested additional funding for contractor delay charges, price increases, change orders, etc. It also asked FEMA to approve telemetry and pump upgrades. FEMA approved some of these items and prepared DSR 83697. Based on this DSR, Villa submitted its first appeal on June 16, 1997. FEMA addressed this appeal and the Project Completion and Certification Report in a letter dated September 30, 1999. FEMA approved telemetry and pump upgrades, and some additional funding for project management costs. It did not fund costs related to project delays or additional costs claimed in the closeout report for other large projects. In its second appeal, dated January 7, 2000, Villa asks for $180,418 in costs associated with the pipeline project and $164,139 for its other large projects.
Issues: 1) Are costs associated with project delays eligible? 2) Are Villa's claimed costs for project management reasonable? 3) Are additional costs for Villa's other large projects eligible?
Findings: 1) No, costs must be directly related to the performance of eligible work. 2) No, the claimed project management costs equal approximately 15 percent of total project costs. 3) No, in one case Villa did not receive a time extension and has not provided a justification for delay. In the other, Villa did not request a cost overrun upon project completion.
Rationale: 44 CFR