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Second Appeal Letter
PA ID# 019-41155-00; City of Lake Cgarles
PW ID# Project Worksheet 155581; Kitchen Equipment
June 17, 2008
Col. Thomas Kirkpatrick (Ret.)
State Coordinating Officer
Governors Office of Homeland Security
and Emergency Preparedness
7667 Independence Blvd.
Baton Rouge, LA 70806
Re: Second Appeal City of Lake Charles, PA ID 019-41155-00, Kitchen Equipment
, FEMA-1603-DR-LA, Project Worksheet (PW) 15581
Dear Col. Kirkpatrick:
This is in response to your letter dated January 24, 2008, which transmitted the reference second appeal on behalf of the City of Lake Charles (Applicant). The Applicant is appealing the Department of Homeland Securitys Federal Emergency Management Agencys (FEMA) denial of its first appeal dated August 27, 2007. The Applicant requests that FEMA obligate $14,732 in costs it claims as equipment costs related to the operation of a shelter at the Lake Charles Civic Center. The scope of work and cost estimate are captured in PW 15581.
The Applicant-owned Lake Charles Civic center was used as a shelter during and following Hurricanes Katrina and Rita. The American Red Cross staffed the shelter from August 27, 2005 to November 13, 2005. FEMA prepared PW 15581 to capture estimated costs related to the use of the Applicants kitchen facilities at this site between August 27 and September 22, 2005. The Applicant estimates the kitchen was used from 5 a.m. to 10 p.m. daily at an hourly rate of $33.33 (based on commercial kitchen rental rates found on internet), for a total of $14,732. Specifically, the Applicant is claiming expenses related to the use of its refrigerators/freezers, gas stoves, fryers, double ovens, microwave ovens, food warmer carts, ice machines, and coffee makers. FEMA determined PW 15581 to be ineligible because there was no basis for reimbursement of wear and tear on kitchen equipment.
The Applicant submitted its first appeal on April 5, 2007. It cited 44 CFR §206.228(a), which states that eligible direct costs include reimbursement for ownership and operation costs of applicant-owned equipment used to perform eligible work. It states that the expenditures were necessary emergency protective measures and it is within FEMAs authority to reimburse for the use of applicant-owned equipment. FEMA denied the appeal on August 27, 2007, based on guidance contained in the Public Assistance Guide
(FEMA 322, October 1999), which states, If the applicants facilities are used by the volunteer agency to provide [emergency mass care and sheltering], actual expenses incurred by the applicant, such as supplies or cleanup labor, would
be eligible. FEMA also cited Disaster Specific Guidance (DSG) #2, Eligible Costs for Emergency Sheltering Declarations Hurricane Katrina
, dated September 9, 2005, which contains similar language, In many instances, shelters are operated in government-owned facilities but managed by a volunteer agency. In such instances, only actual expenses incurred by the eligible applicant, such as supplies or cleanup labor, would be eligible.
On December 7, 2007, the Applicant submitted its second appeal. It states that the appeal determination applies only to the issue of being reimbursed for costs related to sheltering, and not to kitchen equipment use. It contends that intensive use of such equipment would result in considerable deterioration and depreciation of these major appliances compared to reasonably expected normal use during the Citys regular business operations. In addition, it claims that there should be no distinction between Applicant-owned kitchen equipment, and other equipment that is used in the performance of eligible work (such as heavy equipment in the field).
Emergency Support Function #6, Annex to the National Response Plan defines mass care to include sheltering, feeding operations, emergency first aid, bulk distribution of emergency items, and collecting and providing information on victims to family members. FEMA guidance has been clear and consistent in terms of costs related to the provision of mass care. When voluntary agencies use Applicant-owned facilities to provide mass case, including feeding and sheltering, actual expenses incurred by the eligible Applicant may be reimbursed. In this case, the Applicant is not claiming actual expenses incurred, rather what amounts to a rental charge for the use of its kitchen facility. The kitchen and its appliances are an integral part of the facility and are necessary for the provision of feeding operations. Equipment rates for the use of the kitchen are not reimbursable. Therefore, the appeal is denied.
Please inform the Applicant of my decision. My determination constitutes the final decision on this matter as set forth in 44 CFR §206.206.
Carlos J. Castillo
Disaster Assistance Directorate
cc: William Peterson
FEMA Region VI