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Second Appeal Brief
PA ID# 000-UC1AO-00; Mississippi Department of Wildlife, Fisheries, and Parks
PW ID# 5878, 6056, 6101, 6149, 6157, and 10983; Buccaneer State Park Reconstruction
Citation: FEMA-1604-DR-MS, Mississippi Department of Wildlife, Fisheries, & Parks, Phase I Facility Reconstruction Costs
Cross-Reference: Pre-Disaster Condition; Reasonable Cost; General Eligibility
Summary: Hurricane Katrina’s heavy rains, strong winds, and flooding completely destroyed the buildings and contents of Buccaneer State Park, a facility of the Mississippi Department of Wildlife, Fisheries, and Parks (Applicant). FEMA prepared Project Worksheets (PW) 5878, 6056, 6101, 6149, 6157, and 10983 for reconstruction of the damaged structures. Before closeout, the Applicant submitted change orders for additional work, much of which FEMA denied. The Applicant submitted five first appeals, contending that additional costs in the amount of $215,381.07 represented by the change orders were eligible for reimbursement. The FEMA Regional Administrator denied the first appeals because (1) the documentation did not demonstrate the additional work was necessary to return the facility to pre-disaster condition or was necessary to comply with applicable codes and standards, (2) a portion of the additional work appeared to improve the facility beyond its pre-disaster condition, and (3) FEMA considered overhead and profit to be incentives for identifying cost savings and not eligible costs. The Applicant included as-built plans with its four second appeals to demonstrate that much of the work in question was necessary to return the facility to its pre-disaster conditions. The Applicant also included documentation of the construction contract conditions and further information detailing the need for other additional funding. Due to the overlapping issues in the five appeals, FEMA combined the decisions for the five appeals into a single response.
Issues: 1. Does the Applicant’s documentation demonstrate the costs are eligible because the additional work is necessary to return the facility to its pre-disaster condition and/or are reasonable, necessary, and directly tied to accomplishing eligible work ?
2. Are the requested overhead and profit costs related to cost savings eligible for reimbursement?
Findings: 1. Yes
2. Partially, only costs that relate to cost savings for eligible work are eligible.
Rationale: 44 CFR §206.223, General work eligibility; 44 CFR §206.226, Restoration of damaged facilities; Stafford Act §406 (e)(1), 42 U.S.C. § 5172 (e)(1) Repair, Restoration, and Replacement of Damaged Facilities; PA Guide, FEMA 322, page 40 (June 2007); 44 CFR §13.22, Allowable costs; American Institute of Architects (AIA) Document A201: General Conditions of the Contract for Construction (1997), § 7.3.7.