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Debris Removal

Appeal Brief Appeal Letter

Appeal Brief

DesastreFEMA-1735-DR
ApplicantOklahoma Electric Cooperative, Inc.
Appeal TypeSecond
PA ID#000-UQ004-00
PW ID#722
Date Signed2009-06-10T04:00:00
Citation: FEMA-1735-DR-OK, Oklahoma Electric Cooperative, Inc., PW 722

Summary: On March 19, 2008, FEMA prepared PW 722 to cover the cost of vegetative debris removal at several locations on Oklahoma Electric Cooperative’s (Applicant) owned and maintained right-of-ways (ROW). The Applicant requested $51,493 in direct administrative costs associated with identifying eligible vegetative debris. The expense was for a software program, ROWKeeper, provided by Davey Resource Group. The assessment done by Davey Resource Group was for all ROW vegetative interference, not just for disaster-related ROW debris. FEMA wrote a version to the PW that included $5,149 (10%) for this administrative cost.

On May 1, 2008, the Applicant submitted their first appeal asserting that the Applicant was not involved in writing the scope of work and that FEMA officials had approved the use of Davey Resource Group to assist with debris damage assessment.

The Regional Administrator denied the appeal on July 2, 2008, stating that the debris assessment cost was an eligible expense, but it was not a “reasonable cost”. FEMA determined that the assessment cost was equal to 34.7 percent of the total debris removal cost, and was therefore, unreasonable. Eligible debris was
10 percent of the total debris removed applied to the total assessment cost resulted in an eligible assessment cost of $5,149.

The Applicant submitted its second appeal on September 5, 2008. The Applicant did not submit any additional information with this appeal. The State supports the Applicant’s appeal.

Issues: 1. Was the ROW assessment only for disaster-related debris?
2. Did the cost of the ROW assessment meet the test of reasonableness?

Findings: 1. No.

2. No.

Rationale: 44 Code of Federal Regulations §13.22 Allowable costs; OMB Circular A-122, Cost Principles for Non-Profit Organizations, Attachment A.

Appeal Letter

June 10, 2009

Kathleen Shingledecker
Deputy State Coordinating Officer
Department of Emergency Management
2401 N. Lincoln
Oklahoma City, Oklahoma 73105

Re: Second Appeal–Oklahoma Electric Cooperative, Inc., PA ID 000-UQ004-00,
Debris Removal, FEMA-1735-DR-OK, Project Worksheet (PW) 722

Dear Ms. Shingledecker:

This letter is in response to your letter dated September 12, 2008, which transmitted the referenced second appeal on behalf of Oklahoma Electric Cooperative, Inc. (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of $46,344 for the cost of a debris assessment software program.

On March 19, 2008, FEMA prepared PW 722 to cover the costs of vegetative debris removal at several locations on Applicant-owned and maintained right-of-ways (ROW). The Applicant requested $51,493 in direct administrative costs associated with identifying eligible vegetative debris. The expense was for a software program, ROWKeeper, provided by Davey Resource Group. FEMA wrote a version to the PW that included $5,149 (10%) for this administrative cost.

The Applicant submitted a first appeal on May 1, 2008, asserting that the Applicant was not involved in writing the scope of work and that FEMA officials had approved the use of Davey Resource Group to assist with debris damage assessment. The Regional Administrator denied the appeal on July 2, 2008, stating that use of the debris assessment software was eligible, but only to the extent it met the test of “reasonableness.” FEMA determined that the assessment cost was equal to 34.7 percent of the total eligible debris removal costs, and was therefore unreasonable. In order to determine a reasonable cost, FEMA compared eligible debris versus ineligible debris that was identified in the assessment utilizing the software. The assessment included all current ROW vegetative interference not just disaster-related debris. The Davey Resource Group report itemized the linear footage that was eligible for FEMA reimbursement. Eligible debris constituted 10 percent of the overall debris identified in the assessment. The amount obligated in the version PW was equal to 10 percent of the total assessment cost, resulting in an eligible assessment cost of $5,149.

The Applicant submitted its second appeal on September 5, 2008, requesting reimbursement of $46,344. The Applicant did not present any additional information with this appeal. The State supports the Applicant’s appeal. In its appeal, the Applicant states that Disaster Assistance Policy DAP9525.9, Section 324 Management Costs and Direct Administrative Costs, Section VII(D).(1) identifies direct administrative costs as costs that can be tracked, charged, and accounted for directly to a specific project. FEMA does not disagree that the use of the cost of debris assessment software is an eligible direct administrative cost. However, all costs must be both eligible and reasonable. OMB Circular A-122, Cost Principles for Non-Profit Organizations, Appendix A states, “A cost is reasonable if, in its nature or amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the costs.” The Applicant did not present additional or sufficient information as part of its second appeal to substantiate the reasonableness of the additional assessment costs.

I have reviewed the information submitted with the 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 the 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.

Sincerely,
/
s/

James A. Walke
Acting Assistant Administrator
Disaster Assistance Directorate

cc: Gary Jones
Acting Regional Administrator
FEMA Region VI