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Second Appeal Letter
PA ID# 099-39375-00; Town of Lantana
PW ID# 1839; Sidewalk and dune crossover repair
January 17, 2012
Bryan W. Koon
Florida Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, Florida 32399-2100
Re: Second Appeal-Town of Lantana, PA ID 099-39375-00, Sidewalk and dune crossover repair, FEMA-1785-DR-FL, Project Worksheet (PW) 1839
Dear Mr. Koon:
This is in response to your letter dated March 11, 2011, which transmitted the referenced second appeal on behalf of Town of Lantana (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) de-obligation of $49,650 in funding for the repair of concrete sidewalk and dune crossovers.
As a result of Tropical Storm Fay, heavy winds and rain damaged the Applicant’s concrete sidewalks and the support system for a dune crossover. Project Worksheet (PW) 1839 was prepared to document the damages and estimate the costs incurred by the Applicant to repair the damaged facilities. The Applicant submitted their direct administrative costs and the proposed repair costs based on a vendor estimate for a total of $117,264. FEMA reviewed the proposed costs using FEMA’s Cost Estimating Format (CEF) and reduced the eligible amount to $48,985. Pursuant to the Public Assistance Policy Guide dated June 2007, when a project has not been completed at the time of the request, a cost estimate must be used. FEMA uses a cost estimating methodology called CEF for large projects to better estimate the total cost of large projects and projects that are less than ninety percent complete.
In its first appeal dated January 29, 2010, the Applicant requested that FEMA reconsider the de-obligation resulting from use of CEF and obligate costs based on the Applicant’s original estimate. The Applicant stated that the initial cost estimate was reasonable. On September 30, 2010, FEMA denied the first appeal stating that FEMA prepared the cost estimate using the Cost Estimate Format (CEF) in accordance with FEMA guidelines. In accordance with the FEMA Public Assistance Guide FEMA 332, dated June 2007, FEMA establishes reasonable costs on the basis of several factors. The estimate provided by the Applicant did not contain documentation detailing proposed costs, therefore FEMA did not consider the cost estimate to be reasonable.
On March 11, 2011, the Florida Division of Emergency Management (State) submitted a second appeal reiterating its position from the first appeal that FEMA restore funding based on actual costs. The Applicant provided documentation that the work had been bid out and completed at a cost of $98,635 including direct administrative costs. The costs of the project exceeds the FY 2008 threshold of $60,900 for large projects and it is in accordance with the requirements of Title 44 of the Code of Federal Regulations (CFR) §206.205(b), Large Projects.
The Applicant’s project originated as a Large project, however the FEMA CEF reduced the total costs. In the second appeal, the Applicant provided documentation demonstrating project completion and actual costs incurred to complete the eligible work. Total costs claimed by the Applicant are $98,209. In accordance with 44 CFR §206.205(b), Large projects, FEMA will approve funding for actual costs for Large projects. Costs still must be reasonable for the work performed. Therefore, it is recommended that the appeal be approved and final inspection and reconciliation be conducted to validate the actual eligible costs.
I have reviewed all of the information submitted with the second appeal and determined that the Applicant’s second appeal should be granted. By copy of this letter, I am informing the Regional Administrator of my determination in order for him to implement this decision.
Please inform the Applicant of my decision. This determination constitutes the final decision on this matter pursuant to 44 CFR §206.206, Appeals.
cc: Major P. May
FEMA Region IV