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Second Appeal Letter
PA ID# 059-0006B-00; St. Jude Medical Center
PW ID# 3080; Parking Structure
August 12, 2010
Governor’s Authorized Representative
California Emergency Management Agency
Response and Recovery Division
3650 Schriever Avenue
Mather, CA 95665
RE: Second Appeal–St. Jude Medical Center, PA ID 059-0006B-00,
Parking Structure, FEMA-1577-DR-CA, Project Worksheet (PW) 3080
Dear Mr. McCarton:
This letter is in response to your letter dated January 18, 2007, which transmitted the referenced second appeal on behalf of the St. Jude Medical Center (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) decision to deny $46,537 for additional costs associated with repairs to the saturated soil in the open foundation of the St. Jude Medical Center parking structure.
During the winter storms from December 27, 2004 through January 11, 2005, excessive rains saturated soils in the open foundation of a parking structure at St. Jude Medical Center that was under construction. FEMA prepared PW 3080 to reimburse the Applicant for soil removal and aeration costs of $29, 242, engineering costs of $640, overtime for masonry work of $1,304 and temporary labor overtime for the replacement of sandbags and piping of storm water of $1,653. The Applicant claimed an additional $56,969 for materials, equipment, and services related to completion of the scope of work described in PW 3080. FEMA determined the additional $56,969 was ineligible for funding because the Applicant did not sufficiently document that the additional costs were associated with damage caused by the disaster.
On October 28, 2005, the Applicant submitted its first appeal to the Governor’s Office of Emergency Services (now the California Emergency Management Agency (CalEMA)). The Applicant revised the amount under appeal to $46,537. This amount included $40,818 for project management and $5,719 for various equipment and materials. The Applicant provided documentation that it claimed supported its request. CalEMA did not support the first appeal. The Deputy Regional Administrator denied the first appeal in a letter dated September 21, 2006, reiterating that the Applicant did not sufficiently document that the subject costs were associated with damage caused by the disaster.
On December 5, 2006, the Applicant submitted its second appeal arguing that the subject costs did correlate with the disaster related scope of work. The Applicant provided additional information, including a contract change order for the extra equipment and man hours, letters from the contractor stating that the additional costs were incurred in the performance of disaster- related work, and a breakdown of the contractor’s hours and duties performed. In a letter dated January 18, 2007, CalEMA transmitted the second appeal to FEMA. CalEMA supported the second appeal.
The scope of work for PW 3080 included removing, aerating and replacing saturated soil; resetting survey monuments; performing expedited masonry work; pumping storm water, and placing sandbags. Based on a review of the information submitted with the appeal, the contractor incurred an additional $5,724 to perform the eligible scope of work. This amount is eligible for reimbursement. However, the $40,818 for project management is over 100 percent of the cost to complete the scope of work and is excessive. FEMA will provide three percent of project costs for project management, or $1,157.
Based on the documentation provided in the second appeal, I have determined that the Applicant incurred an additional $5,724 to perform the eligible scope of work. In addition, $1,157 for project management costs is eligible. Therefore, I partially approve the appeal for $6,881. By copy of this letter, I request the Regional Administrator to take appropriate action to implement this determination.
Please inform the Applicant of my decision. This determination constitutes the final decision on this matter pursuant to 44 CFR §206.206, Appeals.
Elizabeth A. Zimmerman
cc: Nancy Ward