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Second Appeal Analysis
PA ID# 071-U76MD-00; Audubon Commission
PW ID# Project Worksheet 6138; Replacement of Fish
The Audubon Commission is a political subdivision of the State of Louisiana and owns the Audubon Aquarium of the Americas (AAOA) in the Greater New Orleans area. As a result of damage from Hurricane Katrina and subsequent extended power outages in the area, over 3,000 fish specimens in the aquarium facilities perished, valued at approximately $616,000. Project Worksheet (PW) 6138 was prepared to document the loss of the fish. At the time of preparation, the Project Officer (PO) concluded that the lost fish constituted a one-of-a-kind collection and recommended that the PW be considered ineligible for FEMA funding. During the course of review, it was determined that the fish could be considered as contents of an eligible facility and were therefore eligible for replacement if they could be commercially obtained. However, instead of procuring replacement fish through commercial sources, the applicant opted to mount collection expeditions to capture specimens for the aquarium at a cost of $99,766.09. Based on this action, the PW was determined to be ineligible and was obligated for $0 on May 14, 2007. Prior to the obligation, the applicant had submitted a first appeal based on its assumption that the funding would be denied. That appeal was addressed by FEMA in its appeal response dated May 17, 2007, which stated that, “…the cost for the applicant to… capture wild fish … is not eligible for reimbursement.” On July 24, 2007, the applicant elected to exercise its right to a second appeal and requested that FEMA reverse the previous eligibility determination and provide reimbursement for its costs to capture replacement fish.
On September 25, 2007, the State supported the applicant’s appeal, claiming that the applicant’s actions are eligible under FEMA’s Public Assistance (PA) Program, citing the normal industry means of stocking large aquariums, the applicant’s expertise in animal conservation, husbandry and collection, the applicant’s care in avoiding the capture of endangered species, and the cost effectiveness of the capture process.
At the time of Hurricane Katrina, the Stafford Act, Title 44 of the Code of Federal Regulations (CFR) and published FEMA policy documents did not contemplate or address the definition of facility contents to include living creatures. However, some provision has been made in this and prior disasters for the replacement of commercially available animals belonging to eligible applicants and used for the purposes of education or research, in accordance with 44 CFR §206.266(h). In those cases, only the cost of providing commercially available animals with the most similar characteristics to those destroyed was considered; the cost of breeding or maturing the animals to more closely match the destroyed animals was not eligible. In addition, where replacement animals were donated to the applicants by other legitimate sources (e.g., aquariums, zoos, wildlife refuges, etc.), the cost of transporting the donated animals was considered eligible.
FEMA generally considers the replacement of eligible damaged or destroyed facility contents on the basis of their availability and cost in the commercial marketplace. For the types of contents typically lost in a declared disaster (e.g., office equipment, school materials, hospital supplies, etc.), a competitive market readily exists. However, the same is not true regarding fish of the type required to stock large, public aquariums. While some fish may be available through limited commercial avenues, the most practical and expedient method of procurement of the large quantities required to restock a facility such as the AAOA is through live capture during collection expeditions. Although this method of replacement is not considered typical by FEMA’s normal practice in the PA Program, it is somewhat typical for this type of applicant.
During the preparation of the PW, the applicant estimated the value of the lost fish at $616,000. However, the applicant’s representative stated that this was only his best estimate and did not necessarily represent the actual cost that would be incurred to replace the fish. The applicant did not provide any additional supporting information to justify the estimate or to demonstrate the commercial availability of the fish. During the review of this appeal, a limited sampling of replacement costs for fish listed in the applicant’s inventory was prepared and it was found that the cost were reasonable when compared to the applicant’s collection expeditions. In addition, not all fish sampled were readily available commercially, demonstrating that the market for replacement fish is not comprehensively available for the applicant to access.
Based on the documentation provided, the applicant has satisfied its need to replace its lost inventory through donations and expeditions; the eligible replacement of fish has been accomplished at a lower cost than what might reasonably be expected if procured through commercial sources.
CONCLUSION AND RECOMMENDATION
From the information provided in the appeal documentation, it is apparent that the applicant, through the collection expedition process, achieved the intent of the eligible work (replacement of lost fish) at a cost that can be considered reasonable. It should be noted that the applicant must present all supporting documentation related to this project, including information regarding donated items, at final reconciliation and closeout. It is recommended the appeal be