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Insurance Requirement

Appeal Brief Appeal Letter

Appeal Brief

DisasterFEMA-1785-DR
ApplicantSt. Lucie County
Appeal TypeSecond
PA ID#111-99111-00
PW ID#PWs 803, 1884, 1921
Date Signed2011-12-15T05:00:00

 

Citation:         FEMA-1785-DR-FL, St. Lucie County, Insurance Requirement, Project Worksheets (PWs) 803, 1884, and 1921               

Cross-

Reference:      Insurance Purchase Requirement

Summary:       St. Lucie County (Applicant) received funding to repair damages to the Smithsonian Marine Center, Mets Sports Complex, and Fairwinds Golf Course as a result of Hurricanes Frances, Wilma and Jean.  Project Worksheets (PW) were prepared for PW 803 for $1,853, PW 1884 for $2,090, and PW 1921 for $2,656.  As part of FEMA’s insurance review of PW 803, 1884 and 1921, FEMA discovered that the Smithsonian Maine Center, Mets Sports Complex, and Fairwinds Golf Course received funds as a result of a prior disaster and required to obtain and maintain appropriate insurance on this facility.  FEMA de-obligated the funds because the Applicant received funding for the aforementioned facilities from a previous disaster of the same type.   In its First appeal, November 23, 2009, the Applicant asserts that repair costs to the facilities are eligible for the deductible portion of the Applicant’s insured property.  FEMA denied the appeal stating that pursuant to FEMA Disaster Assistance Fact Sheet 9580.3 ” a deductable, up to and including the amount of eligible damages incurred in a previous disaster, is not eligible for the same facility in a subsequent disaster of the same type.”   The Applicant has received FEMA funding for repairs to damages sustained during a previously declared event. 

Issue:              Is the Applicant eligible for funding for the same facilities when the Applicant received funding in a subsequent disaster of the same type?

Finding:           No

Rationale:       Section 311 (a) and (b) Insurance of the Robert T. Stafford Disaster Relief and Emergency Assistance Act; 44 Code of Federal Regulations (CFR) §206.253

Insurance requirements for facilities damaged by disasters other than flood; and Disaster Assistance Fact Sheet DAP9580.3 Insurance Considerations for Applicants.

Appeal Letter

December 15, 2011

Bryan Koon

Director

Florida Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, Florida 32399-2100

Re:  Second Appeal-St. Lucie County, PA ID 111-99111-00, Insurance RequirementFEMA-1785-DR-FL, Project Worksheets (PWs) 803, 1884, 1921

Dear Mr. Koon:
This letter is in response to a letter from your office dated December 22, 2010, which transmitted the referenced second appeal on behalf of St. Lucie County (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA)
de-obligation of $6,601 in funding for the repair of the Smithsonian Marine Center (PW 803), the Fairwinds Golf Course (PW 1921), and the Mets Sports Complex (PW 1884). 

Background

As a result of Tropical Storm Fay, heavy winds and rain damaged the Smithsonian Marine Center, the Fairwinds Golf Course, and the Mets Sports Complex.  Project Worksheets (PWs) were prepared (PW 803 for $1,853, PW 1884 for $2,090, and PW 1921 for $2,656) with the stated condition that the Applicant must obtain and maintain insurance coverage in the amount of eligible assistance provided.  During the review of PWs 803, 1884 and 1921, FEMA found that the three aforementioned facilities were previously damaged during Hurricanes Frances, Wilma and Jean.  The Applicant received reimbursement for the insurance deductibles for these facilities.  Pursuant to 44 CFR  §206.253(f), Insurance requirements for facilities damaged by disasters other than flood, when the same facility is damaged by a subsequent event and had an insurance requirement from a previous disaster, FEMA will reduce the eligible costs up to the amount of the previous insurance requirement.  FEMA reduced the referenced PWs to zero dollars as the Applicant received assistance in a previous disaster that included a requirement to obtain and maintain insurance as a condition of future eligibility.

 First Appeal 

In its first appeal dated November 23, 2009, the Applicant requested that FEMA reconsider the de-obligation of $6,601 because they contended the prerequisite insurance obligations had been satisfied and the damages outlined in PWs 803, 1884 and 1921 were not subject to any such pre-existing insurance requirement.  On April 14, 2010, FEMA denied the first appeal stating that the Applicant received FEMA Public Assistance funding in a previously declared event.  Additionally, as stated in FEMA’s Disaster Assistance Fact Sheet: 9580.3, Insurance Considerations for Applicants, dated May 29, 2008, a deductable up to the amount of eligible damages incurred in a previous disaster is not eligible for the same facility in a subsequent disaster of the same type. 

Second Appeal

On August 31, 2010, the Applicant submitted a second appeal reiterating its position that the prerequisite insurance requirements had been satisfied.  The Applicant also claims that the State Insurance Commissioner had certified that it was not reasonable to require insurance coverage to cover the type of damage sustained by the Applicant’s facilities.  As evidence of this, the Applicant provided a letter from the State Insurance Commissioner, which addressed the State’s Property Insurance Policy.   

Discussion

While the Applicant has provided a letter from the State Insurance Commissioner, dated March 19, 2010, that letter deals with facilities covered under the State of Florida’s Property Insurance Policy and does not pertain or apply to the damage to the Applicant’s insured facilities.   Therefore, FEMA does not consider the March 19, 2010 letter to be a certification that the purchase and maintain requirements, which the Applicant agreed to as a condition of its previous receipt of Public Assistance funding, were unreasonable.  In addition, pursuant to Disaster Fact Sheet: 9580.3 FEMA does not provide funds for an insurance deductable when funding has been provided for a deductible for the facility in a previous declared event of the same type.  The Applicant had previously received reimbursement, including deductibles, for the three facilities due to damages incurred during Hurricanes Frances, Wilma, and Jean. Therefore, these costs to repair the same facilities, that fall within the insurance deductible, as reflected in PWs 803, 1884 and 1921 are not eligible.   

Conclusion

I have reviewed all of the information submitted with the second appeal and determined that the Regional Administrator’s decision in the first appeal is consistent with Public Assistance regulations and policy.  Accordingly, I am denying this second appeal. 

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

/s/

Deborah Ingram
Assistant Administrator
Recovery Directorate
cc:  Major P. May
       Regional Administrator
       FEMA Region IV