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Emergency Protective Measures

Appeal Brief Appeal Letter

Appeal Brief

DesastreFEMA-1467-DR
ApplicantMonroe County
Appeal TypeSecond
PA ID#055-99055-00
PW ID#771 and 818
Date Signed2004-07-19T04:00:00
Citation: FEMA-1467-DR-NY; Monroe County; PWs 771 and 818

Cross-reference: Emergency Protective Measures

Summary: A severe ice storm impacted Monroe County from April 3 through 5, 2003, and caused the Buttonwood Pump Station to lose both primary and auxiliary power. The station pumps approximately 14 million gallons of waste a day and is close to residences and an environmentally sensitive stream within the Lake Ontario watershed. Both the County and the State Emergency Operations Center were unable to locate a suitable generator for rent, so the County purchased a suitable 1,400 KV generator at a low bid of $170,000.

FEMA initially denied funding because the purchase of a generator that did not previously exist at the facility was not an allowable expense under Category B, Emergency Protective Measures. However, FEMA did reimburse the County for the hours that the generator was in use. On October 3, the State forwarded the County’s first appeal letter, dated September 29, 2003. On October 28, 2003, FEMA denied the first appeal citing that "the rental of a generator would be considered a temporary emergency measure. The purchase of a generator is a permanent capital expense and as such, would not be considered emergency or temporary in nature." In a letter dated January 15, 2004, the State forwarded the County’s second appeal dated the same day. The County acknowledged “FEMA may even require us to sell the generator at auction and claim reimbursement for the difference between the purchase price and the sale price. Further supplemental documentation was provided in a letter dated January 23, 2004.

Issues: Will FEMA reimburse for the purchase of a generator under Category A, Emergency Protective Measures?

Findings: Yes, FEMA will fund the difference between the purchase and salvage value of the generator.

Rationale: 44 CFR § 13.32 (e)(2) and Response and Recovery Policy Number 9525.12.

Appeal Letter

July 19, 2004

Mr. John Agostino
Alternate Governor’s Authorized Representative
New York State Emergency Management Office
Public Security Building 22, State Campus
Albany, New York 12226-5000

Re: Second Appeal, Monroe County, PA ID 055-99055-00, Emergency Protective Measures, FEMA-1467-DR-NY, Project Worksheets (PWs) 771 and 818.

Dear Mr. Agostino:

This letter is in response to your January 15, 2004, letter forwarding the referenced second appeal on behalf of Monroe County (County). The County disputes the Federal Emergency Management Agency’s (FEMA) denial of a 1,400 KV generator purchased for the purpose of emergency protective measures at a sewage pumping station during an ice storm.

A severe ice storm impacted Monroe County from April 3 through 5, 2003, and caused the Buttonwood Pump Station to lose both primary and auxiliary power. The station pumps approximately 14 million gallons of waste a day and is near residences and an environmentally sensitive stream within the Lake Ontario watershed. The County initially contacted the State Emergency Operations Center for assistance in locating a rental generator; however, the State could not locate an appropriately sized generator for the pumping station’s needs. Since there were no available rental units of the required capacity, several vendors offered generators for purchase. The County researched comparable pricing for similar generators and chose the lowest offer of $170,000.

FEMA denied reimbursement on the grounds that the purchase of a generator is a permanent capital expense and is not eligible as a Category B, Emergency Protective Measure, which provides for only “temporary” emergency measures. However, FEMA did reimburse the County for the hours that the generator was in use. On October 3, 2003, the State forwarded the County’s first appeal letter, dated September 29, 2003. In a supplemental appeal letter, the County argued that it "[took] exception to the determination of the Non Allowable Expense as arbitrary and nonbinding with respect to the context of written law since we have knowledge of past practices where generator purchases have been reimbursed by the FEMA/SEMO agencies respectively." On October 28, 2003, FEMA Region II denied the first appeal stating, "The rental of a generator would be considered a temporary emergency measure. The purchase of a generator is a permanent capital expense and as such, would not be considered emergency or temporary in nature."

In a letter dated January 15, 2004, the State forwarded the County’s second appeal dated the same day. The County acknowledged “FEMA may even require us to sell the generator at auction and claim reimbursement for the difference between the purchase price and the sale price.” Further supplemental documentation was provided in a letter dated January 23, 2004, explaining in more detail the reasons why a generator could not be rented, as well as evidence that FEMA had previously approved the purchase of generators through FEMA’s Hazard Mitigation Grant Program.

In exceptional emergency situations, equipment may be purchased when it cannot be obtained through rental sources (Response and Recovery Policy 9525.12). In this instance, the County had an urgent need to restore power at the Buttonwood Station in order to prevent a sewage overflow into local waterways and the surrounding community. The County contacted nine sources in an attempt to locate a suitable rental generator, but ultimately had no recourse but to purchase a generator.

The County’s reference to a previous instance where FEMA paid for a generator is not applicable, as it refers to the Hazard Mitigation Grant Program, which is a separate program, authorized under Section 404 of the Stafford Act. Hazard Mitigation Grant Program regulations do not apply to the Public Assistance Program, which is authorized under Section 406 of the Stafford Act.

Because the County did not own a generator prior to the disaster, the County is not eligible for its full cost under the Public Assistance Program. However, 44 CFR § 13.32 (e)(2) and Response and Recovery Policy Number 9525.12, allows FEMA to fund the difference between the purchase price and the current fair market value of the generator when it was no longer needed for emergency work.

Because of the extreme market conditions that existed during the disaster, the applicant had no choice but to purchase the generator at a cost of $170,000, which was the lowest cost available. This was $31,470 above the estimated 2003 market value of $138,530. I have determined that Monroe County is eligible for $30,570, which is the difference between the applicants purchase price and the current fair market value of the generator when it was no longer needed for work, less the $900 already paid for the hours the generator was in operation during the disaster. By copy of this letter, I am requesting FEMA’s Region II office to implement this decision through preparation of a revised Project Worksheet.

Please inform the County of my decision. My determination constitutes a final decision of this matter pursuant to 44 CFR § 206.206.

Sincerely,
/S/
Daniel A. Craig
Director
Recovery Division
Emergency Preparedness and Response

cc: Joseph Picciano
Acting Regional Director
Region II