Summary: Heavy rainfall beginning in May 2008 resulted in severe flooding and caused extensive damage in the City of Cedar Rapids (Applicant). FEMA prepared PW 5262 in the amount of $149,261 for contract costs to place and service portable toilets for three months in flood affected areas of the City. Included in the cost was $1,563 in Direct Administrative Costs (DAC). After the Iowa Homeland Security and Emergency Management Division (Grantee) reviewed the Applicant’s documentation of actual costs, FEMA closed out PW 5262 and increased the total eligible project cost to $626,606 based on the Grantee’s recommendation. The adjusted total included $3,188 in DAC. The Applicant requested an additional $378 in DAC; however FEMA determined that the Applicant’s documentation did not support the eligibility of 1) $221 in DAC associated with a consultant’s hourly rate that exceeds $155 and 2) $157 in DAC claimed for work completed 90 days after project completion. In the first appeal, the Applicant asserted that both categories of DAC were eligible for reimbursement. In the appeal response, the Regional Administrator noted that the Applicant did not justify the hourly rate above $155 or provide documentation to support claims after 90 days and determined that the claim for both, $378, was ineligible. In the second appeal, the Applicant reiterates that the DAC charged at an hourly rate above $155 is eligible because the protocol used to procure the contract established the rate as a reasonable cost and justified the rate as appropriate for the project manager skill level/expertise. The Applicant cites 44 CFR 44, §13.36(b), Procurement, Procurement standards, and OMB Circular A-87, Attachment A, section C, and Attachment B paragraph 32 as supporting its claims regarding reasonableness of the consultant’s hourly rate. After reviewing the second appeal, FEMA requested additional information detailing the specific administrative tasks performed by the contractor that were associated with claimed DAC. The Applicant submitted documentation including general tasks, but did not provide specific descriptions of administrative tasks that were explicitly requested by FEMA.
Issue: Has the Applicant provided sufficient documentation identifying specific administrative tasks that would enable FEMA to determine whether the claimed Direct Administrative Costs are eligible for reimbursement?
Rationale: 44 CFR §13.36 Procurement, Disaster Assistance Policy 9525.9, Section 324 Management Costs and Direct Administrative Costs