PA ID# 113-12000-00; City of Cedar Rapids
PW ID# 10267; Direct Administrative Costs
Conclusion: The Applicant did not demonstrate that the costs incurred for contracted labor at $285 per hour were reasonable for grant administration work. Furthermore, the Applicant failed to provide sufficiently detailed and descriptive documentation to demonstrate that the previously funded contracted DAC tasks/activities, and project management costs are eligible or reasonable.
Heavy rainfall beginning in May 2008 resulted in severe flooding that caused extensive damage in the City of Cedar Rapids (Applicant). FEMA prepared PW 10267 for $279,091.00, using the cost estimating format (CEF), to perform repairs on flood damaged areas in the Jones Golf Course Clubhouse. Included in the project costs were $2,654.00 in Direct Administrative Costs (DAC). After the Iowa Homeland Security and Emergency Management Division (Grantee) reviewed the Applicant’s documentation of actual costs, FEMA closed out the PW and increased the total eligible DAC to $49,824.90 ($47,170.90 more than estimated in the CEF) based on the Grantee’s recommendation. Furthermore, FEMA reduced the eligible DAC ($8,010.55) claimed by the Applicant’s contractor. The Applicant requested an additional $2,407.60 in DAC; however, FEMA determined that the Applicant’s documentation did not support the eligibility of $2,407.60 in DAC associated with a consultant’s hourly rate that exceeded $155. In the first appeal, the Applicant asserted that the DAC was eligible for reimbursement. In the appeal response, the Regional Administrator noted that the Applicant did not justify the hourly rate above $155 and determined that the claim for $2,407.60 was ineligible. In the second appeal, the Applicant argues that the consultant’s project manager rate was appropriate by virtue of the time required to review and supervise its lower level employees, reasonable by the Applicant’s adherence to proper contract procurement protocols, and comparable to another consulting contractor’s rates employed by the Grantee.
Disaster Assistance Policy (DAP) 9525.9, Section 324 Management Costs and Direct Administrative Costs dated March 12, 2008.
Disaster Assistance Policy (DAP) 9525.9, Section 324 Management Costs and Direct Administrative Costs, Section VII(D)(1).
DAC include costs that can be tracked, charged and accounted for directly to a specific project, such as staff time to complete field inspection and preparation of a PW. Direct costs are limited to actual reasonable costs incurred for a specific project. Such costs will be considered project costs.