Final Funding Determination

Appeal Brief Appeal Letter

Appeal Brief

DisasterFEMA-1008-DR
ApplicantRubio Canon Land and Water Association
Appeal TypeSecond
PA ID#037-90106
PW ID#51877
Date Signed2003-01-17T05:00:00
Citation: FEMA-1008-DR-CA; Rubio Canon Land and Water Association, Final Funding Determination; Damage Survey Report (DSR) 51877

Cross-reference: Eligible Costs; Force Account

Summary: The Rubio Canon Land and Water Association’s (RCLWA’s) water distribution system sustained damage during the 1994 Northridge Earthquake. The Federal Emergency Management Agency (FEMA) approved DSR 51877 in the amount of $1,133,323 for pipe replacement, engineering, and inspection. RCLWA requested $662,425 in additional funding on August 14, 1995, for the replacement of earthquake-damaged pipe. FEMA determined that the levels of damage were not extensive enough to warrant pipeline replacement but subsequently approved DSR 88552 on July 16, 1996, for $20,649 and DSR 60975 on October 19, 1996 for $3,278 to make pipe clamp repairs at additional leak locations. On July 24, 1996, RCLWA requested additional funding to replace pipelines at various locations, which included locations where pipe clamp repairs covered by DSR 88552 had already been completed. RCLWA used its own funds to complete these replacements prior to the July 24, 1996, request for additional funding, which was denied by FEMA because the repair cost was less than 50% of the replacement cost. However, FEMA approved DSR 02565 on December 5, 1996, to provide $2,372 for four additional pipe clamp repairs not included in previous DSRs. OES notified RCLWA on March 21,1997, of this determination and the procedure to appeal the determination. FEMA closed out the project based on the previously approved amount of $1,159,622 and notified OES on June 21, 2000. RCLWA submitted its first appeal on August 28, 2000 requesting the difference between its claimed costs and the final funding determination, $89,564. The Acting Regional Director denied the appeal because the pipeline replacement work completed by RCLWA was not an approved scope of work and the appeal was not submitted within the regulatory timeframe. Therefore, the final funding was reduced to $826,047 and a de-obligation DSR for $333,575 was processed. OES supports RCLWA’s second appeal for $88,124 to cover the of force account labor used on eligible work.

Issues: Are the force account and engineering and inspections costs eligible?

Findings: Yes. Documentation submitted with appeal supports the claim.

Rationale: 44 CFR §206.206(a)

Appeal Letter

January 17, 2003

Mr. Dallas Jones
Governor’s Authorized Representative
Governor’s Office of Emergency Services
P.O. Box 419047
Rancho Cordova, California 95741-9047

Re: Second Appeal – Rubio Canon Land and Water Association, PA ID 037-90106, Final Funding Determination, FEMA-1008-DR-CA, Damage Survey Report (DSR) 51877

Dear Mr. Jones:

This letter is in response to your April 12, 2002, letter forwarding the referenced second appeal on behalf of the Rubio Canon Land and Water Association (RCLWA). The RCLWA has requested that the Federal Emergency Management Agency (FEMA) approve force account costs and engineering and inspection costs not previously claimed during closeout or in the first appeal. The amount requested is $88,124.

The 1994 Northridge Earthquake caused damage at various locations throughout the water distribution system of RCLWA. FEMA approved DSR 51877 on January 13, 1995, in the amount of $1,133,323 for pipe replacement and engineering and inspection costs. On August 14, 1995, RCLWA requested $662,425 in additional funding for pipeline replacement. FEMA denied the request because the level of damage did not warrant replacement. Subsequently, FEMA approved DSR 88552 for $20,649 to clamp and seal additional leaks in the pipe. FEMA also approved DSR 60975 on October 19, 1996, for $3,278 to repair additional leaks discovered during an inspection along Highland Avenue. On July 24, 1996, RCLWA again requested additional funding for pipeline replacement along Maiden Lane, Mount Curve Avenue, Athens Street, Lake Avenue, and Dolores Drive. FEMA denied this request because pipe clamp repairs, covered by DSR 88552, had already been completed along these roads. Also, the repair cost was less than 50 percent of the replacement cost. However, FEMA approved DSR 02565 on December 5, 1996, in the amount of $2,372 for additional pipe clamp repairs not previously discovered.

FEMA approved a total of $1,159,622 for RCLWA’s projects. RCLWA submitted its Project Completion and Certification Report on September 29, 1999, with a claimed cost of $1,293,846. FEMA closed the project for $1,159,622 because RCLWA did not submit any documentation to support its claim for additional costs. FEMA notified OES of its determination on June 21, 2000. RCLWA submitted its first appeal on August 28, 2000, for $89,564 after revising its claim for system-wide pipeline repair work to $1,249,186. It stated its claimed costs were actual costs while the final determination amount was an estimated cost. The Acting Regional Director denied the appeal on January 24, 2002, because pipeline replacement work completed under a $364,188 contract completed by RCLWA with its own money was not an approved scope of work. As a result of the final inspection, the final funding was revised from $1,159,622 to $826,047 and a de-obligation DSR for $333,575 was processed. Also, an appeal of the determination to deny funding for this work was not submitted within the allowable timeframe.

RCLWA submitted its second appeal on March 14, 2002. It did not dispute the denial of the $364,188 contract for pipeline replacement work. Instead, it requested $88,124 for force account costs and engineering and inspection costs related to eligible work performed on DSR 51877. These costs have not been previously approved because RCLWA has not submitted them during the closeout or first appeal. In it’s second appeal package, RCLWA submitted spreadsheets and new documentation to support its claim for the additional force account and engineering and inspection costs. I have reviewed all of the documentation and have determined these costs to be eligible and reasonable. Thus, the appeal is approved. By copy of this letter, I ask the Regional Director to prepare a DSR for $88,124 to implement my decision.

Please inform RCLWA of my decision. My determination constitutes the final decision on this matter as set forth in 44 CFR §206.206.

Sincerely,
/S/
John R. D’Araujo, Jr.

Assistant Director
Response and Recovery Directorate

cc: Jeff Griffin
Regional Director
FEMA, Region IX
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