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Debris Removal

Appeal Brief Appeal Letter

Appeal Brief

DisasterFEMA-1604-DR
ApplicantCity of Waveland
Appeal TypeSecond
PA ID#045-78200-00
PW ID#6720
Date Signed2010-03-29T04:00:00

SECOND APPEAL BRIEF
FEMA-1604-DR-MS
City of Waveland, PA ID 045-78200-00
Debris Removal, Project Worksheet 6720

Citation:          FEMA-1604-DR-MS, City of Waveland, Project Worksheet (PW) 6720

Cross
Reference:
       Debris Removal, Duplication of Benefits, Reasonable Cost
 
Summary:         Following Hurricane Katrina, the Applicant entered into a contract with Taking Care of Business, Inc., (TCB) for debris removal on September 11, 2005, at the rate of $18.25 per cubic yard (CY).  This included a tipping fee of $3.00 per CY.  The Applicant and TCB subsequently signed an addendum to this contract that addressed the collection, hauling, and disposal of debris from demolished structures, including potentially asbestos-containing material.  The addendum contains no provision stating that the Applicant would pay the contractor for actual demolition of the structures.  The addendum states that the Applicant would pay all disposal fees directly to two landfills that were eligible to receive such material at a rate of $9.90 and $10.00 per CY respectively.  At closeout, the Applicant requested reimbursement of $490,968.  However, FEMA prepared PW 6720 for $379,784 for two reasons:  FEMA determined that $15 per CY was more reasonable; and that since the Applicant had agreed to pay all tipping fees directly to the landfill, reimbursement of the $3.00 tipping fee for the contractor’s costs would represent a duplication of benefits. 

In its first appeal, dated July 2, 2008, the Applicant argued that $18.25 per CY was reasonable and further, that the Applicant was contractually obligated to pay its contractor this amount.  FEMA denied the first appeal on February 24, 2009, stating that the Applicant had failed to provide sufficient justification for either reimbursement of costs at $18.25 per CY or for reimbursing the Applicant twice for disposal of the same debris.  It its second appeal, dated April 28, 2009, the Applicant reiterates its original request and argument.  The Applicant additionally argues that the contractor undertook demolition  of the structures in addition to the collection and hauling of the debris from the demolished structures, and that the contractor’s additional costs from demolition more than offset FEMA’s potential savings from deduction of the $3.00 per CY tipping fee that was included in the contractor costs. The Applicant argues that this amount should not be deducted because the hazardous debris was more labor-intensive to collect and haul than the original debris, and that greater distances were involved in transportation.
 
Issues:          Does the Stafford Act prevent FEMA from reimbursing an applicant more than once for disposal costs for the same scope of work?

Findings:       Yes.

Rationale:      Section 312 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act, Duplication of Benefits.

Appeal Letter

March 29, 2010

 

 

 

Thomas M. Womack

Governor’s Authorized Representative

Mississippi Emergency Management Agency

Post Office Box 5644

Pearl, MS 39208-5644

 

Re:  Second Appeal–City of Waveland, PA ID 045-78200-00, Debris Removal,

       FEMA-1604-DR-MS, Project Worksheet (PW) 6720

 

Dear Mr. Womack:

 

This letter is in response to your letter dated June 10, 2009, which transmitted the referenced second appeal on behalf of the City of Waveland (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) reduction of $111,183 for debris removal contract costs.

Background

The Applicant signed a contract for general debris removal on September 11, 2005, following Hurricane Katrina.  The Applicant agreed to pay the contractor $18.25 per cubic yard for debris removal and disposal.  The price included a $3.00 per cubic yard tipping fee for disposal of the debris.  Six months later, the Applicant signed an addendum to the contract to include collecting, hauling, and disposing of debris from demolished structures, including potentially asbestos-containing materials.  The addendum states that the Applicant would pay the contractor $18.25 per cubic yard for collecting and hauling the debris and would pay disposal fees directly to the two landfills eligible to receive such material at a rate of $9.90 and $10.00 per cubic yard, respectively.   FEMA obligated PW 6720 for $334,281 to document eligible costs incurred under this contract addendum for removing 11,875 cubic yards of debris. 

FEMA conducted a final inspection of PW 6720 in September 2007 and determined that the contractor had collected and disposed of 17,342 cubic yards of debris.  The Applicant requested $490,968 in total costs.  FEMA determined that $15.00 per cubic yard (instead of $18.25) was a reasonable cost for the debris removal efforts.  Also, FEMA reduced the eligible price by $3.00 per cubic yard because the Applicant paid the tipping fees directly to the landfill operators.  As a result, FEMA reduced the eligible unit cost for PW 6720 to $12.00 per cubic yards plus $9.90 per cubic yard for disposal, or $21.90 per cubic yard.  FEMA obligated the final version of PW 6720 on April 30, 2008, for $379,784, which was $111,183 less than the Applicant requested.  The Regional Administrator sustained this determination on first appeal in a letter dated February 24, 2009.  The Applicant submitted a second appeal on June 10, 2009.  It stated that the price it paid to move debris was reasonable and comparable to the price the U.S. Army Corps of Engineers paid for similar work.  The Applicant also stated that it cost more to handle the demolition debris and the distance to the landfills was longer (30 and 38 miles) than the landfill for the regular debris.

Discussion

Based on review of debris removal cost data, FEMA has determined that $18.25 per cubic yard was a reasonable rate for the debris removal work that the contractor performed.  The contract addendum that the Applicant and contractor signed stated “The City of Waveland and the TCB agree that the unit price of $18.25 will remain the same for ROW/ROE and debris generated from the demolition of structures on private property…The City of Waveland will be responsible for paying fees directly to Allied Waste Inc., and Pecan Grove Sanitary Landfill at the aforementioned rates.”  The $18.25 price includes a $3.00 tipping fee.  Since the Applicant paid the tipping fees for the demolition debris directly to the landfill, FEMA will deduct $3.00 from the $18.25 rate to avoid paying for the same service twice.  FEMA is prohibited from reimbursing the Applicant twice for costs of disposal fees for the same work.  Therefore, the Applicant is eligible to receive an additional $56,361 (17,342 cubic yards x $3.25).

Conclusion

I have reviewed the information submitted with the appeal and have determined that the Applicant is eligible for an additional $56,361.  Therefore, I am partially approving the appeal for $56,361.  By copy of this letter, I am requesting the Regional Administrator take appropriate action to implement my decision. 

Please inform the Applicant of my decision.  This determination is the final decision on this matter pursuant to 44 CFR §206.206, Appeals.

Sincerely,

 /s/

Elizabeth A. Zimmerman

Assistant Administrator

Disaster Assistance Directorate

cc:     Major P. May

Regional Administrator

FEMA Region IV