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Second Appeal Letter
PA ID# 117-UIWGG-00; Joint Undertaking for Transitional Education (J.U.T.E.) Inc.
PW ID# 7180; Time Extension
May 16, 2012
Florida Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, Florida 32399-2100
Re: Second Appeal–Joint Undertaking for Transitional Education (J.U.T.E.) Inc., PA ID 117-UIWGG-00, Time Extension, FEMA-1539-DR-FL, Project Worksheet (PW) 7180
Dear Mr. Koon:
This letter is in response to a letter from your office dated December 28, 2010, which transmitted the referenced second appeal on behalf of Joint Undertaking for Transitional Education, Inc. (J.U.T.E.) (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) decision to deny funding in the amount of $403,896 and a time extension for the replacement of Applicant’s facility.
The Applicant is a private nonprofit organization that provides transitional housing with individualized supportive services for single parent families in Sanford, Florida. Hurricane Charlie damaged the Applicant’s residential building, located at 1701 Brisson Drive. FEMA obligated PW 6759 on October 15, 2005, in the amount of $177,295 to repair the damaged facility. FEMA subsequently determined the facility was eligible for replacement. FEMA de-obligated PW 6759 and obligated PW 7180 on December 12, 2006, in the amount of $182,655 for the replacement of the facility at the Brisson Drive location. In January 2007, PW 7180 was amended to adjust funding based on insurance reviews, and version 1 was obligated in the amount of $403,896. The Applicant withdrew $150,914 from the State in January 2007. The property at the Brisson Drive location was foreclosed upon in October 2007.
In October 2008, the Florida Division of Emergency Management (State) forwarded to FEMA the Applicant’s request for a change in the Scope of Work (SOW) indicating that the damaged facility had been foreclosed upon and that the Applicant proposed to relocate its residential program to 903 S. Scott Avenue. On November 23, 2009, the State submitted the Applicant’s request for a time extension stating that project progress was delayed due to a “review by the OIG”. In a letter dated March 1, 2010, FEMA denied the extension request, based on a finding that the damaged facility had been foreclosed upon and was now bank owned. Because the Applicant no longer owned the damaged facility, FEMA prepared PW 7180 v2 to de-obligate $403,896 in funding and, further, denied the time extension.
The Applicant submitted a first appeal on April 29, 2010, which was transmitted by the State to FEMA on July 2, 2010. The Applicant stated that the damaged facility was foreclosed due to the length of time it took to receive Public Assistance funding. It further stated that it relocated its residential program to the S. Scott Avenue location, which was owned by the program’s executive director and leased to the Applicant.
On September 17, 2010, the Regional Administrator cited several regulations as the basis for denying the first appeal. First, in order to extend the project performance period, an applicant must submit a detailed justification for the delay and demonstrate extenuating circumstances or unusual project requirements beyond its control (44 CFR §206.204, Project Performance). According to the Public Assistance State Administrative Plan §(VI)(2) dated January 2005, the State can “administer funds to the applicant, upon the applicant’s request for reimbursement for actual costs.” Foreclosure proceedings related to the damaged facility were completed two years after PW 6759 was obligated and nine months after the obligation of PW 7180. Because project funds were obligated and available for payment by the State, the ability to request reimbursement was within the control of the Applicant. The Regional Administrator denied the appeal for a time extension request on this basis.
Second, with regard to the funding to replace and relocate the facility, the Regional Administrator determined that the Applicant did not provide support documentation that the damaged facility was subject to repetitive damage (44 CFR §206.226(g)(1), Restoration of damaged facilities, Relocation), but rather was the result of the foreclosure on the previously owned property. Further, pursuant to 44 CFR §206.223(a)(3), General work eligibility, “To be eligible for financial assistance, an item of work must be the legal responsibility of an eligible applicant.” As a result of the foreclosure the Applicant was no longer legally responsible for the damaged facility. Therefore, the Regional Administrator found that funding to replace the facility was not eligible for Public Assistance and denied the appeal.
The Applicant submitted its second appeal on November 7, 2010, which the State transmitted to FEMA on December 28, 2010. The Applicant reiterated its first appeal arguments that delays completing the project were primarily due to delays in providing PA program funds, as well as bank foreclosure on the damaged facility, an “OIG review”, and circumstances faced by the Applicant’s Executive Director.
In accordance with 44 CFR §206.204(c)(2)(ii) and §206.204(d)(2), Project Performance Requests for time extensions, “an applicant must submit a detailed justification for the delay,” and demonstrate “extenuating circumstances or unusual project requirements” beyond its control.” The Applicant states that the delays in completing the rebuilding project were primarily due to inaccessible PA funding. The original project (PW 6759) was obligated in October 2005. The replacement project was obligated in December 2006, and amended in January 2007 to provide funds previously deducted for insurance. In January 2007, the Applicant received $150,914 in PA funds from the State to begin its rebuilding activities at the damaged facility location (Brisson Drive). The Brisson Drive property was foreclosed upon in October 2007, two years after PW 6759 was obligated and nine months after the obligation of PW 7180. On November 11, 2009, the Applicant submitted a request for a time extension for the project, which was forwarded to FEMA by the State on November 23, 2009. Neither the Applicant nor the State demonstrated extenuating circumstances that would have prevented the Applicant from completing the project in a timely manner.
With regard to assistance for relocating the facility, under FEMA’s regulations (44 CFR §206.226(g)(1), Restoration of damaged facilities, Relocation) FEMA may require relocation of a facility that is subject to repetitive heavy damage. This is not the case with the Applicant’s facility. An applicant may also request an improved project and use the funding to relocate the facility to a new location. As an improved project, funding would be limited to the eligible cost to replace the facility at its original location. The Applicant submitted a request for a change in the scope of work for PW 7180 on September 16, 2008, to relocate the facility to the new location (S. Scott Avenue). By that time, the Applicant no longer owned the original facility (Brisson Drive). 44 CFR §206.223(a)(3), General work eligibility, General, requires that for work to be eligible, an item of work must be the legal responsibility of an eligible applicant. The Applicant no longer owned the facility that was damaged by the disaster and, as a result repairs to the facility are not eligible for Public Assistance funding.
I have reviewed the information submitted with the appeal and have determined that the Regional Administrator’s decision is consistent with Public Assistance regulations and policies. Accordingly, I am denying the Applicant’s second appeal.
Please inform the Applicant of my decision. This determination is the final decision on this matter pursuant to 44 CFR §206.206, Appeals.
cc: Major P. May
FEMA Region IV