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Second Appeal Analysis
PA ID# 017-UOSG5-00; Golden West Community Services District
PW ID# 1248, 2688, 3382, and 3285; Small Project Overrun
Golden West Community Services District, PA ID 017-UOSG5-00
Net Small Project Overrun, Project Worksheets (PWs) 1248, 2688, 3382, and 3825
Severe storms and flooding during FEMA-1628-DR-CA, from December 17, 2005, through January 3, 2006, damaged roads maintained by the Golden West Community Services District (Applicant) in El Dorado County, California. The Applicant requested disaster assistance from the Federal Emergency Management Agency (FEMA) to repair and mitigate damage to four roads. FEMA prepared four PWs for four small projects, totaling $49,247. FEMA obligated PW 1216, Calcite Drive, for $7,600 on May 9, 2006; PW 1248, Mica Fire Exit Road, for $8,878 on May 4, 2006; PW 2688, Calcite Drive, for $10,152 on July 12, 2006; and PW 3382, Oak Ridge Circle, for $22,617 on July 20, 2006.
The approved PW scopes of work provided for replacement of aggregate gravel (road base), riprap, road/ditch grading, and associated costs for labor, equipment, mobilization and demobilization. FEMA also approved hazard mitigation measures involving the installation of riprap and two culverts (one with a headwall) for the projects at Calcite Drive and Mica Fire Exit Road. The Applicant had not completed the projects when FEMA obligated the original PWs. FEMA obligated funding based on estimated costs. On April 20, 2007, following notification from the Applicant, the Governor’s Office of Emergency Services (OES) submitted to FEMA a “Request for Correction to PW 1248 and Request for PW” (Request for Corrections).
The Applicant completed all of the small projects on May 11, 2007, and submitted a Project Completion and Certification Report (P.4) to OES on July 19, 2007. On September 18, 2007, FEMA and the State sent a team to evaluate the projects sites to determine if the PWs appropriately reflected the scope of work to repair the disaster damages. The team recoded its findings in a Final Inspection Report (FIR) dated October 5, 2007. On December 18, 2007, OES submitted an “Errors and Omissions–Final Inspection Report” to FEMA, requesting that FEMA approve additional funding for the projects. OES did not submit actual costs data or a certification that it had reviewed the Applicant’s documentation with its request.
FEMA treated the FIR as a first appeal for a Net Small Project Overrun (NSPO). FEMA denied the appeal on February 12, 2008, because the Applicant did not submit documentation of actual costs correlated to each line item in the approved PW scopes of work and the Applicant submitted the NSPO seven months after completion of the small projects. Title 44 Code of Federal Regulations (CFR) §206.204(e) (2), Project performance, Cost overruns, states that applicants must submit their NSPO appeals within 60 days of completions of the small projects.
In response to the Request for Corrections, FEMA deobligated PW 1216 (Calcite Drive) on March 19, 2008, because the work duplicated work contained in PW 2688. FEMA approved $21,700 in additional funding on PW 1248-1 (Mica Exit Road) on March 20, 2008. On April 24, 2008, FEMA approved $14,684 in estimated costs for Sodalite Street East on PW 3825. FEMA did not take any action on the request for hazard mitigation because the State did not submit a benefit cost analysis to show that the proposal was cost effective. As a result of these actions, the total approved funding for the Applicant’s small projects was $78,031.
The Applicant submitted a second appeal for the NSPO request to OES on July 7, 2008. It submitted additional information to OES on August 15, 2008. OES transmitted the appeal to FEMA on September 5, 2008. The Applicant stated that it did not meet the NSPO deadline due to extenuating circumstances arising from the death, in March of 2007, of the primary board member with responsibility for the projects and knowledge of FEMA requirements. In addition, the Applicant stated that “useful information” related to the FEMA projects had been deleted from the deceased’s computer.
The Applicant submitted the following documents to support its appeal: (1) two invoices from Delta, the contractor who performed the work, totaling $408,246; (2) proof that the Applicant paid $248,111 of the invoiced amount; and, (3) spreadsheets showing actual cost for each line item on PWs 1248, 2688, 3382, and 3825, which totaled $246,332. The Applicant’s second appeal letter and the OES’ second appeal transmittal letter cited the higher amount of $254,573 as the requested funding, which corresponds to the total amount recommended by OES in the first appeal. The Applicant also submitted the Delta bid schedule with an explanation regarding the need to use recycled asphalitic concrete for the road base due to unavailability of aggregate gravel,. The Applicant stated it was currently in litigation with Delta over the remaining invoice balance of $160,135 plus interest. Therefore, it was unable to provide additional detailed cost information. The Applicant stated that it would submit another request for reimbursement to FEMA once the litigation was settled. Additionally, the Applicant provided information on the mitigation proposal to meet the requirement for a benefit cost analysis.
The OES submitted a request to revise the scope of work for PW 1248 to FEMA on April 20, 2007. In response to this request, FEMA revised the scope of work and obligated additional funding for PW 1248 on March 20, 2008. FEMA denied the Applicant’s first appeal on February 12, 2008, prior to responding to the Applicant’s request to revise the scopes of work of the PWs. Because FEMA did not respond to the Applicant Request for Correction before it responded to the first appeal, FEMA will evaluate the merits of the second appeal.
Based on the Delta invoices, the contractor provided 2,982 cubic yards of road base at $100 per cubic yard and 400 cubic yards of riprap at $85 per cubic yard. FEMA has determined that the actual unit costs for the work were reasonable, but determined that the quantities of work approved in the PWs represent the actual quantities of eligible work performed. The approved PW scopes of work included a total of 1,798 cubic yards of road base and 369 cubic yards of riprap. Combining the actual unit costs and approved quantities yielded eligible costs of $179,800 for the road base and $31,365 for the riprap.
The scopes of work approved in the PWs also included 118 man-hours of grading on three of the projects, including $1,600 for 40 hours to grade 900 square yards on Calcite Drive. The invoice for this work, however, reflected a lump sum charge of $23,245 to grade Calcite Drive. This is not a reasonable cost to grade 900 square yards. Moreover, the invoice did not provide any detail regarding the actual scope of work performed, although the bid schedule appeared to indicate it was for mitigation; that is, to “allow better drainage.” It also did not address grading on the other projects. Since the actual eligible costs for grading could not be ascertained from the information provided, FEMA has determined that no costs for grading would be included in the NSPO calculation of actual eligible costs.
Regarding the headwall and culvert at Mica Fire Exit Road, the invoices included $7,110 to install a 50 linear-foot culvert and headwall. The work completed at Mica Fire Exit Road was consistent with the scope of work approved in PW 1248 and the actual cost appears to be reasonable. Regarding the culvert at Calcite Drive, the invoices included $6,075 to install a 45 linear-foot culvert at Calcite Drive. The work completed at Calcite drive was not consistent wap unit cost of $135 per linear foot to install the 45 linear-foot culvert was applied to the eligible quantity of a 24 linear-foot culvert to arrive at a total eligible cost of $3,240. None of the additional costs invoiced for culverts were considered, as they were not part of the eligible PW scopes of work.
With respect to the associated costs for labor, equipment, and mobilization/demobilization line items included in the PW scopes of work, these costs were not separately billed and there was no basis for determining whether they were already included in the unit costs previously mentioned. Therefore, there was no basis for separately approving reimbursement of those costs.
The additional information the Applicant provided on the hazard mitigation proposals was also reviewed. FEMA determined that the information provided was not sufficient to meet the requirement for a benefit cost analysis stipulated in the February 15, 2008, FEMA letter regarding the Request for Corrections. Therefore, the scope of the additional hazard mitigation proposals was not included in the NSPO calculation of actual eligible costs.
The following table summarizes the current approved small project PW amounts, the amounts claimed by the Applicant on second appeal, and the eligible actual costs per PW calculated as a result of the NSPO analysis.
PW Amount Currently
(including versions) Amount Claimed by Applicant on
Second Appeal Total Amount Eligible per NSPO Analysis Amount of Eligible Overrun
1216 $0 $0 $0 $0
1248 $30,578 $147,800 $141,085 $110,507
2688 $10,152 $38,647 $21,995 $11,843
3382 $22,617 $23,485 $29,035 $6,418
3825 $14,684 $36,400 $29,400 $14,716
Totals $78,031 $246,332 $221,515 $143,484
Regarding the Applicant’s statement that it plans to request additional funding from FEMA after it settles its litigation with the contractor, this response to the second appeal is FEMA’s final administrative actions regarding PWs 1248, 2688, 3382, and 3825.
FEMA has determined that the Applicant incurred an eligible cost overrun of $143,484 for PWs 1248, 2688, 3382, and 3825. Therefore, FEMA partially approves the appeal. FEMA will not consider requests for additional funding in the future.