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Second Appeal Letter
PA ID# 291-UTVUV-00; Hull-Daisetta Independent School District
PW ID# 08564; Anticipated Insurance Proceeds
September 20, 2010
W. Nim Kidd
Assistance Director, Texas Department of Public Safety
Chief, Texas Division of Emergency Management
P.O. Box 4087
Austin, Texas 78773
Re: Second Appeal–Hull-Daisetta Independent School District, PA ID 291-UTVUV-00, Anticipated Insurance Proceeds, FEMA-1791-DR-TX, Project Worksheet (PW) 08564
Dear Mr. Kidd:
This is in response to a letter from your office dated March 15, 2010, which transmitted the referenced second appeal on behalf of Hull-Daisetta Independent School District (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) decision not to reinstate $7,530 to PW 08564 that FEMA deducted for anticipated insurance proceeds for the Applicant-owned Assistant Superintendent’s House.
FEMA prepared PW 08564 to fund eligible repairs to the Assistant Superintendent’s House that was damaged by high winds and debris during Hurricane Ike. FEMA deducted $7,530 from
PW 08564 to account for anticipated insurance proceeds. On April 21, 2009, PW 08564 was obligated in the amount of $284 for direct administrative costs.
On May 26, 2009, the Applicant submitted its first appeal, which was transmitted by the State to FEMA on October 1, 2009. The Applicant provided a copy of its insurance policy and a copy of a Replacement Cost Value/Building and Contents Schedule to support its appeal. The Schedule lists the Applicant’s insured properties, which includes the Assistant Superintendent’s House. Citing insurance policy section 6.G, the Applicant stated that the damaged facility is excluded from coverage because it is a framed structure. The State in support of the Applicant’s appeal also stressed that section 6.H excludes “All loss or damage caused to any building or auxiliary structure valued at less than $50,000.”
In a letter dated December 30, 2009, the Regional Administrator denied the appeal on the basis that the damaged facility appears on the Schedule of Insured Locations list having a replacement cost value of $80,000, which contradicts the Applicant’s claim that the property is excluded from insurance coverage. However, a 2 percent Total Insured Value of the facility ($1,600) is eligible for Public Assistance Funding. Because PW 07801 absorbed $1,447 of the $1,600 deductible for fence repair costs at the Assistant Superintendent’s House, the Regional Administrator approved an additional $153 for the remaining portion of the eligible deductible.
The Applicant submitted its second appeal on February 8, 2010, which the State transmitted to FEMA on March 15, 2010. The Applicant reiterates the same position it claimed in the first appeal. The Applicant submitted new documents that include copies of letters from its insurance claims adjuster, dated February 5, 2010, stating that damages to the Assistant Superintendent’s House are not covered under the provisions of the policy. The Applicant also states that the same situation applies to PW 08485 (J.H Maintenance Storage Building), PW 00687 (High School Stadium Restrooms), and PW 09431, (Middle School Maintenance Shed Contents) and recommends as well that FEMA restore funding to these projects.
Section 312 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act precludes FEMA from duplicating benefits, including those from insurance. Pursuant to 44 CFR §206.250(c), General, “Actual and anticipated insurance recoveries shall be deducted from otherwise eligible costs.” Anticipated insurance proceeds for the Assistant Superintendent’s House were estimated based on insurance information provided to FEMA by the Applicant following Hurricane Ike. The Applicant subsequently provided insurance confirmation that the facility damage is not covered under the insurance policy provisions.
Based on a review of all documentation submitted with the second appeal, I have determined that the documentation the Applicant submitted with its second appeal is sufficient to support its claim that the damaged facility is excluded from coverage and eligible for Public Assistance funding. Therefore, I am approving this appeal to reinstate $7,530 to PW 08564 for roof and building repairs. We recommend that the Region and the Applicant work together to resolve the other referenced PWs. The Regional Administrator will take appropriate action to implement this determination.
Please inform the Applicant of my decision. This determination is the final decision on this matter pursuant to 44 CFR §206.206, Appeals.
Elizabeth A. Zimmerman
cc: Tony Russell
FEMA Region VI