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Second Appeal Brief
PA ID# 105-99105-00; Polk County
PW ID# 2714; Lake Wales EMS Facility
Citation: FEMA-1539-DR-FL, Polk County, Replacement Costs – Lake Wales EMS Facility, Project Worksheet (PW) 2714
Reference: Replacement Cost
Summary: In August 2004, Hurricane Charley produced heavy rainfall and severe winds that damaged the EMS facility’s roof exposing the building’s interior rooms to rainwater. The facility also incurred damage to the gutter system, the soffit and fascia, and to two overhead bay doors. Additional damage to the roof and to the building’s interior space was incurred several weeks later during Hurricane Frances and Hurricane Jeanne.
FEMA prepared PW 2714 for $78,746 based on the estimate prepared by Polk County’s (Applicant) insurance company to repair the damaged EMS facility to its pre-disaster condition. The Applicant later requested full replacement costs for the EMS facility and provided a replacement cost estimate of $314,662 that was also prepared by its insurance company. FEMA reviewed both estimates and determined that the facility did not qualify for replacement cost funding, and on March 10, 2005, obligated PW 2714 Version 0 for $78,746.
The Applicant submitted its first appeal to the Regional Administrator on June 23, 2005, requesting full replacement cost for the EMS facility. The Applicant’s support documentation included a copy of the replacement cost estimate and a copy of a structural evaluation of the damaged facility from consulting engineer Robert T. Haug, P.E., which included a repair estimate in the amount of $164,439. At the same time, the Applicant furnished the Joint Field Office (JFO) staff with copies of the repair and replacement costs estimates. A FEMA building assessment team was assigned to re-inspect the facility and review the repair and replacement cost estimates. The assessment team concluded that the facility was eligible for replacement rather than repair. However, the JFO did not notify the Regional Administrator of its decision to approve replacement costs for the EMS facility, and PW 2714 Version 1 was obligated on October 13, 2005, in the amount of $235,915 bringing total project funding to $314,662. The PW was later adjusted to deduct $78,746 for insurance proceeds, which reduced total project funding to $235,915.
The Regional Administrator denied the first appeal in a letter dated January 18, 2006, sustaining FEMA’s original level of funding in the amount of $78,746. Due to an administrative error, FEMA the Regional Administrator’s decision was never implemented and the funds were not de-obligated.
After requesting and receiving a time extension from the State, the Applicant completed construction on the replacement EMS facility in January 2008. The Florida Long Term Recovery Office closed out PW 2714 in June 2009. Inspection of project invoices and cancelled checks substantiated a cost overrun of $91,654. As there was no mention in the project files about a first appeal, PW 2714 Version 4 was obligated for an additional $91,654, and on August 12, 2010, the project closed with actual documented costs of $327,570. On March 16, 2011, FEMA implemented its first appeal decision and de-obligated $248,824.
The Applicant submitted a second appeal requesting reconsideration of FEMA’s decision to de-obligate replacement cost funding. In its appeal, the Applicant states that FEMA’s decision to deny the first appeal is moot because the JFO had revised the PW to approve the replacement of the EMS facility. The State supports the Applicant’s appeal and argues that the second appeal should be treated as a first appeal and offers the “Brandstad Doctrine” to support its position.
Issue: 1. Is the EMS facility eligible for replacement?
Finding: 1. No. The estimate to repair the EMS facility is less than 50 percent of the estimate to replace the damaged facility.
Rationale: Title 44 CFR 206.226(f)(1), Restoration of damaged facilities, Repair vs. replacement; Response and Recovery Directorate Policy 9524.4, Eligibility of Facilities for Replacement under 44 CFR 206.226(f)