Emergency Protective Measures
Appeal Brief
Appeal Letter
Appeal Analysis
Citation:
FEMA-1539/1545/1561-DR-FL, Sarasota County Public Hospital Board, Multiple PWs, Emergency Protective Measures
Increased Operating Expenses; Lock Down
Summary: In response to the threat posed by hurricanes Charley (FEMA-1539-DR-FL), Frances (FEMA-1545-DR-FL), Jeanne (FEMA-1561-DR-FL), the Sarasota County Public Hospital Board (Applicant) incurred costs for force account labor (overtime) and food and beverage supplies while operating in lock down mode in anticipation of the hurricane. The lock down required hospital staff to work overtime and be paid for sleep time. The Applicant submitted three PWs for force account labor overtime and food supplied totaling $408,543.26 (1539-DR, PW 3566), $618,860.05 (1545-DR, PW 3407), and $413,467.51 (1561-DR, PW 1784). In its first appeal the Applicant asserted that the overtime and materials costs were incurred for emergency preparatory work to protect the health of Hospital in-patients and thus eligible. FEMA denied the Applicants first appeals, stating the claimed costs were ongoing operating expenses and thus ineligible. The Applicant filed second appeals with FEMA on May 12, 2006, reiterating its position that the costs were incurred for eligible emergency work.
Issues: Are the costs claimed for emergency work eligible for reimbursement?
Findings: No. The costs do not meet the criteria for eligible emergency work and are considered an increased cost of operation.
Rationale: 44 CFR §206.225, Recovery Policy RP 9525.4 (7)(B)(2)
As a result of the 2004 Florida hurricanes Charley (FEMA-1539-DR-FL), Frances (FEMA-1545-DR-FL), Jeanne (FEMA-1561-DR-FL), the Sarasota County Public Hospital Board (Applicant) initiated its corporate lock-down mode at its hospital facility. The lock-down policy ensures the presence of sufficient staff during times of emergency to maintain medical capabilities. The Applicant requested assistance from the Federal Emergency Management Agency (FEMA) under all three disaster declarations for costs associated with overtime labor and food and beverage supplies for employees who remained on site during the emergency.
The Applicant submitted PW 3566 (1539-DR), PW 3407 (1545-DR), and PW 1784 (1561-DR) for force account labor overtime ($333,948, $611,411, and $411,188, respectively), and equipment, materials, and food costs ($74,595.26, $7,448.70, and $2,279.10, respectively), totaling $408,543, $618,860, and $413,467. FEMA determined the PWs were ineligible for funding because the costs were considered increased operating expenses. Accordingly, FEMA obligated the three PWs for $0 on April 26, 2005, June 10, 2005, and July 27, 2005.
First Appeal
The Applicant submitted first appeals for each of the three PWs on October 21, 2005,
August 19, 2005, and October 28, 2005. The State forwarded the three appeals to FEMA on December 19, 2005. In each appeal, the Applicant asserted that the overtime and materials costs were incurred for emergency preparatory work to protect the health of Hospital in-patients. The Applicant demonstrated that it is a local governmental entity by providing a copy of its Charter establishing it as an independent special district. The Applicant stated that it is therefore eligible to apply for aid under 44 CFR §206.220 and that the claimed expenses are eligible for reimbursement as eligible work under 44 CFR §206.225 (a)(1) which states Emergency protective measures to save lives, to protect public health and safety, and to protect improved property are eligible.
In summary, the Applicant argued that because [its] lockdown costs were mandatory once a disaster was declared, and because the lockdown is an emergency preparatory measure to protect the public health, the costs related to the implementation of [its] lockdown procedures fall within the regulatory definition of eligible work.
FEMA denied the Applicants three first appeals in letters dated January 17, 2006,
June 12, 2006, and February 22, 2006, stating the costs submitted for force account labor, benefits, sleep time, and meals constitute ineligible increased operating expenses.
The appeal responses cite page 33 of the FEMA Public Assistance Guide- FEMA 322, (PA Guide; October 1999) which states, Private Non-Profit (PNP) operating costs for providing services are not eligible, even if increased by the disaster event. The responses also cite FEMA Response and Recovery Policy RP 9525.4(7)(B)(2)(c), Medical Care and Evacuations, which lists ineligible costs for the provision of medical care, including increased administrative and operational cost to the hospital due to increased patient load. FEMA stated the Applicants force account staff performed work it would normally have performed, even without the declaration of its corporate mandated lock-down. In addition, the Applicant did not provide documentation demonstrating that it incurred extraordinary medical care expenses by performing emergency protective measures of the types listed in Policy 9525.4(7)(B) and (C), including emergency sheltering, overtime labor costs to evacuate and assist in the transport of patients from a damaged facility, leased equipment for use in temporary quarters, or security for the temporary treatment area.
Second Appeal
On May 12, 2006, the Applicant submitted second appeals of FEMAs denial of the three appeals in the amounts of $408,543.26 (PW 3566), $618,860.05 (PW 3407) and $413,467.51 (PW 1784) in costs for force account labor (overtime and sleep-time) and food and beverage supplies while operating in lock-down mode during the three hurricanes. The three second appeals were forwarded by the State to FEMA on September 25, 2006, July 13, 2006, and October 2, 2006.
In its second appeals, the Applicant reiterates that it is a unit of local governmentnot a PNP. The Applicant also states that the costs claimed are not enumerated in the list of uncovered costs provided in FEMA Response and Recovery Directorate Policy 9525.4 (7)(B)(2). Further, the Applicant states that emergency preparatory measures are eligible for reimbursement under the terms of Title 44 of the Code of Federal Regulations (44 CFR) §206.223, as the measures were performed within the disaster area and were the legal responsibility to perform such work (i.e., provide hospital care services). The Applicant also argues that its efforts qualify as emergency work as described in 44 CFR §206.225(a)(1).
DISCUSSION
FEMA acknowledges that the Applicant is not a PNP entity; however, this fact has no bearing on the determination. Increased operating costs incurred by all applicants, PNPs and units of local government, are ineligible for funding under the Public Assistance program.
The regulation at 44 CFR §206.225 authorizes FEMA to fund emergency protective measures to save lives, to protect public health and safety, and to protect improved property. To be eligible for reimbursement under Public Assistance, actions must:
(i) Eliminate or lessen immediate threats of significant additional damage 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 that are cost effective.
The Applicant specifies that the work performed by the staff employed during the lock-down mode. The Applicant states that the funding is not requested for the provision of emergency medical care, the cost of follow-on treatment of disaster victims due to an increase in patient load, or a cost associated with loss of revenue .the funding is for necessary precautionary disaster preparations. It appears that the preparations performed by the Applicant, while required by their hospital management policies during times of emergency or disaster, did not by themselves directly eliminate or lessen immediate threats to life, safety, or health.
The Applicant also states that the work performed was assuring the continuing care and protecting the immediate threat to their already compromised health that the lack of staffing would entail, of the Countys most vulnerable citizens-those already hospitalized and unable to be safely discharged upon the declaration of the emergency and those persons with special needs who came to the Hospital as a shelter for persons with special needs. According to this description, the work performed went beyond preparatory measures and included the provision of care to patients.
FEMA Recovery Policy RP 9525.4 (7)(B)(2) states the following extraordinary expenses to provide medical care are ineligible:
a. Cost of emergency medical treatment of any kind (including vaccinations);
b. Cost of follow-on treatment of disaster victims;
c. Increased administrative and operational cost to the hospital due to increased patient load;
d. Costs associated with loss of revenue.
Based on the documentation submitted in support of the three appeals, the costs submitted by the Applicant are considered to be increased administrative and operational costs incurred while providing its standard level of service. These costs are ineligible for reimbursement.
CONCLUSION
Appeal Brief
| Disaster | FEMA-1539/15 |
| Applicant | Sarasota County Public Hospital Board |
| Appeal Type | Second |
| PA ID# | 115-U3J9Y-00 |
| PW ID# | Multiple PWs |
| Date Signed | 2007-04-25T04:00:00 |
FEMA-1539/1545/1561-DR-FL, Sarasota County Public Hospital Board, Multiple PWs, Emergency Protective Measures
Appeal Letter
04/25/2007
Mr. W. Craig Fugate
Florida Department of Community Affairs
Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, Florida 32399-2100
Re: Second Appeal Sarasota County Public Hospital Board;
PA ID# 115-U3J9Y-00, Emergency Protective Measures,
FEMA-1539/1545/1561-DR-FL, Multiple PWs
Dear Mr. Fugate:
This letter is in response to your letters dated July 13, 2006, September 25, 2006, and October 2, 2006, transmitting the three second appeals on behalf of the Sarasota County Public Hospital Board (Applicant). In all three appeals, the Applicant disputes the basis of the Department of Homeland Securitys Federal Emergency Management Agencys (FEMA) determination to deny the reimbursement of costs associated with the lock-down mode initiated during the disaster.
For reasons explained in the enclosed analysis, I have determined that the claims of $408,543.26 (1539-DR, PW 3566), $618,860.05 (1545-DR, PW 3407), and $413,467.51 (1561-DR, PW 1784) for force account overtime and material expenses are increased operating costs and not eligible for FEMA reimbursement. Therefore, these appeals are denied.
Please inform the Applicant of my decision. This determination constitutes the final decision on this matter pursuant to 44 CFR §206.206.
Sincerely,
/s/
David Garratt
Acting Assistant Administrator
Disaster Assistance Directorate
Enclosure
cc: Major Phil May
Regional Administrator
FEMA, Region IV
Mr. W. Craig Fugate
Florida Department of Community Affairs
Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, Florida 32399-2100
Re: Second Appeal Sarasota County Public Hospital Board;
PA ID# 115-U3J9Y-00, Emergency Protective Measures,
FEMA-1539/1545/1561-DR-FL, Multiple PWs
Dear Mr. Fugate:
This letter is in response to your letters dated July 13, 2006, September 25, 2006, and October 2, 2006, transmitting the three second appeals on behalf of the Sarasota County Public Hospital Board (Applicant). In all three appeals, the Applicant disputes the basis of the Department of Homeland Securitys Federal Emergency Management Agencys (FEMA) determination to deny the reimbursement of costs associated with the lock-down mode initiated during the disaster.
For reasons explained in the enclosed analysis, I have determined that the claims of $408,543.26 (1539-DR, PW 3566), $618,860.05 (1545-DR, PW 3407), and $413,467.51 (1561-DR, PW 1784) for force account overtime and material expenses are increased operating costs and not eligible for FEMA reimbursement. Therefore, these appeals are denied.
Please inform the Applicant of my decision. This determination constitutes the final decision on this matter pursuant to 44 CFR §206.206.
Sincerely,
/s/
David Garratt
Acting Assistant Administrator
Disaster Assistance Directorate
Enclosure
cc: Major Phil May
Regional Administrator
FEMA, Region IV
Appeal Analysis
BACKGROUNDAs a result of the 2004 Florida hurricanes Charley (FEMA-1539-DR-FL), Frances (FEMA-1545-DR-FL), Jeanne (FEMA-1561-DR-FL), the Sarasota County Public Hospital Board (Applicant) initiated its corporate lock-down mode at its hospital facility. The lock-down policy ensures the presence of sufficient staff during times of emergency to maintain medical capabilities. The Applicant requested assistance from the Federal Emergency Management Agency (FEMA) under all three disaster declarations for costs associated with overtime labor and food and beverage supplies for employees who remained on site during the emergency.
The Applicant submitted PW 3566 (1539-DR), PW 3407 (1545-DR), and PW 1784 (1561-DR) for force account labor overtime ($333,948, $611,411, and $411,188, respectively), and equipment, materials, and food costs ($74,595.26, $7,448.70, and $2,279.10, respectively), totaling $408,543, $618,860, and $413,467. FEMA determined the PWs were ineligible for funding because the costs were considered increased operating expenses. Accordingly, FEMA obligated the three PWs for $0 on April 26, 2005, June 10, 2005, and July 27, 2005.
First Appeal
The Applicant submitted first appeals for each of the three PWs on October 21, 2005,
August 19, 2005, and October 28, 2005. The State forwarded the three appeals to FEMA on December 19, 2005. In each appeal, the Applicant asserted that the overtime and materials costs were incurred for emergency preparatory work to protect the health of Hospital in-patients. The Applicant demonstrated that it is a local governmental entity by providing a copy of its Charter establishing it as an independent special district. The Applicant stated that it is therefore eligible to apply for aid under 44 CFR §206.220 and that the claimed expenses are eligible for reimbursement as eligible work under 44 CFR §206.225 (a)(1) which states Emergency protective measures to save lives, to protect public health and safety, and to protect improved property are eligible.
In summary, the Applicant argued that because [its] lockdown costs were mandatory once a disaster was declared, and because the lockdown is an emergency preparatory measure to protect the public health, the costs related to the implementation of [its] lockdown procedures fall within the regulatory definition of eligible work.
FEMA denied the Applicants three first appeals in letters dated January 17, 2006,
June 12, 2006, and February 22, 2006, stating the costs submitted for force account labor, benefits, sleep time, and meals constitute ineligible increased operating expenses.
The appeal responses cite page 33 of the FEMA Public Assistance Guide- FEMA 322, (PA Guide; October 1999) which states, Private Non-Profit (PNP) operating costs for providing services are not eligible, even if increased by the disaster event. The responses also cite FEMA Response and Recovery Policy RP 9525.4(7)(B)(2)(c), Medical Care and Evacuations, which lists ineligible costs for the provision of medical care, including increased administrative and operational cost to the hospital due to increased patient load. FEMA stated the Applicants force account staff performed work it would normally have performed, even without the declaration of its corporate mandated lock-down. In addition, the Applicant did not provide documentation demonstrating that it incurred extraordinary medical care expenses by performing emergency protective measures of the types listed in Policy 9525.4(7)(B) and (C), including emergency sheltering, overtime labor costs to evacuate and assist in the transport of patients from a damaged facility, leased equipment for use in temporary quarters, or security for the temporary treatment area.
Second Appeal
On May 12, 2006, the Applicant submitted second appeals of FEMAs denial of the three appeals in the amounts of $408,543.26 (PW 3566), $618,860.05 (PW 3407) and $413,467.51 (PW 1784) in costs for force account labor (overtime and sleep-time) and food and beverage supplies while operating in lock-down mode during the three hurricanes. The three second appeals were forwarded by the State to FEMA on September 25, 2006, July 13, 2006, and October 2, 2006.
In its second appeals, the Applicant reiterates that it is a unit of local governmentnot a PNP. The Applicant also states that the costs claimed are not enumerated in the list of uncovered costs provided in FEMA Response and Recovery Directorate Policy 9525.4 (7)(B)(2). Further, the Applicant states that emergency preparatory measures are eligible for reimbursement under the terms of Title 44 of the Code of Federal Regulations (44 CFR) §206.223, as the measures were performed within the disaster area and were the legal responsibility to perform such work (i.e., provide hospital care services). The Applicant also argues that its efforts qualify as emergency work as described in 44 CFR §206.225(a)(1).
DISCUSSION
FEMA acknowledges that the Applicant is not a PNP entity; however, this fact has no bearing on the determination. Increased operating costs incurred by all applicants, PNPs and units of local government, are ineligible for funding under the Public Assistance program.
The regulation at 44 CFR §206.225 authorizes FEMA to fund emergency protective measures to save lives, to protect public health and safety, and to protect improved property. To be eligible for reimbursement under Public Assistance, actions must:
(i) Eliminate or lessen immediate threats of significant additional damage 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 that are cost effective.
The Applicant specifies that the work performed by the staff employed during the lock-down mode. The Applicant states that the funding is not requested for the provision of emergency medical care, the cost of follow-on treatment of disaster victims due to an increase in patient load, or a cost associated with loss of revenue .the funding is for necessary precautionary disaster preparations. It appears that the preparations performed by the Applicant, while required by their hospital management policies during times of emergency or disaster, did not by themselves directly eliminate or lessen immediate threats to life, safety, or health.
The Applicant also states that the work performed was assuring the continuing care and protecting the immediate threat to their already compromised health that the lack of staffing would entail, of the Countys most vulnerable citizens-those already hospitalized and unable to be safely discharged upon the declaration of the emergency and those persons with special needs who came to the Hospital as a shelter for persons with special needs. According to this description, the work performed went beyond preparatory measures and included the provision of care to patients.
FEMA Recovery Policy RP 9525.4 (7)(B)(2) states the following extraordinary expenses to provide medical care are ineligible:
a. Cost of emergency medical treatment of any kind (including vaccinations);
b. Cost of follow-on treatment of disaster victims;
c. Increased administrative and operational cost to the hospital due to increased patient load;
d. Costs associated with loss of revenue.
Based on the documentation submitted in support of the three appeals, the costs submitted by the Applicant are considered to be increased administrative and operational costs incurred while providing its standard level of service. These costs are ineligible for reimbursement.
CONCLUSION
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