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Second Appeal Brief
PA ID# 000-UD067-00; Texas Department of Criminal Justice
PW ID# N/A; Insurance Waiver
Citation: FEMA-1479-DR-TX; Texas Department of Criminal Justice, Insurance Waiver
Cross-reference: Insurance Waiver
Summary: The Texas Department of Criminal Justice sustained damage to several of their facilities resulting from Hurricane Claudette on July 15, 2003. Seven Project Worksheets (PWs) 493, 555, 557, 560, 563, 564, and 566, were prepared however, approval of these PWs was contingent upon the Subgrantee purchasing and maintaining building insurance. An insurance review in January 2004 confirmed that the Subgrantee had not complied with the requirement to obtain insurance so the PWs were reduced to $0. The Subgrantee appealed the insurance requirement by stating it will not purchase insurance and asserting that the State of Texas is self-insured. The Subgrantee further states it will not set-aside funds to protect against future loss, but commits to not seeking additional reimbursement from FEMA. The FEMA Region VI Director denied the appeal based on 44 CFR § 205.253 and additionally citing 44 CFR §75.14, which identifies states that have received approval from FEMA as self-insured. The State of Texas is not included on the list of self-insured States. The requirement to obtain and maintain insurance remains.
Issues: Is the Subgrantee eligible for a waiver of the insurance requirement?
Findings: No. Assistance under section 406 of the Stafford Act is approved only on the condition that insurance is obtained and maintained in such types and amounts as are reasonable and necessary to protect against future loss.