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Highland Lake Dam

Appeal Brief Appeal Letter

Appeal Brief

DisasterFEMA-1143-DR
ApplicantCity of Westbrook
Appeal TypeSecond
PA ID#XXX-XXXXX
PW ID#58003
Date Signed2004-06-17T04:00:00

Citation:

FEMA-1143-DR-ME; City of Westbrook, Highland Lake Dam; Damage Survey Report (DSR) 58003
 

Cross-reference:

Unsupported Project Costs
 

Summary:

Severe flooding in October 1996 caused significant damage to the Highland Lake Dam in the City of Westbrook (City). As a result, the Federal Emergency Management Agency (FEMA) prepared a DSR for $1,175,850 for its replacement and engineering costs. In August 1999, the City awarded a 120 calendar-day construction contract and issued a “Notice to Proceed” beginning on September 7, 1999. Following project completion, the City submitted a letter dated June 30, 2000, to the Maine Emergency Management Agency (State) requesting additional funds in the amount of $331,541. FEMA and a Technical Assistance Contractor (TAC) reviewed the request and, subsequently, FEMA prepared DSR 58003 for $75,999 to adjust the final cost of the project. The City submitted a first appeal on July 18, 2002, claiming that the excess costs were reasonable and necessary for the proper completion of the project and, therefore, eligible for reimbursement from FEMA. The FEMA Region I Regional Director partially approved the appeal on April 10, 2003, granting the City $96,683 in additional costs. The Regional Director denied the remaining $158,859 because it was not adequately supported by documentation and determined to be ineligible. The City submitted its second appeal on June 13, 2003, requesting that FEMA reconsider the remaining $158,859 as eligible. The request is based on the City’s claim that these costs are adequately supported by documentation that establishes that they are eligible. The State supports the City’s appeal.
 

Issues:

Are the additional costs eligible for reimbursement?
 

Findings:

No. The documentation does not support any additional reimbursement. Instead, it indicates that some of the additional reimbursements in the first appeal determination were for ineligible expenses and should not be made.
 

Rationale:

44 CFR §206.205(b)

Appeal Letter

June 17, 2004

M r. Arthur W. Cleaves
Director, Maine Emergency Management Agency
State Office Building, Station 72
Augusta, Maine 04333

Re: Second Appeal – City of Westbrook, Highland Lake Dam, FEMA-1143-DR-ME, Damage Survey Report (DSR) 58003

Dear Mr. Cleaves:

This is in response to your letter dated August 5, 2003, that transmitted the referenced second appeal on behalf of the City of Westbrook (City). The City is requesting reconsideration of the Federal Emergency Management Agency’s (FEMA’s) determination on the eligibility of $158,859 in excess costs for the Highland Lake Dam Project.

Severe flooding in October 1996 caused significant damage to the Highland Lake Dam in the City. As a result, FEMA prepared a DSR for $1,175,850 for its replacement, including engineering costs. In August 1999, the City awarded a 120 calendar-day construction contract and issued a “Notice to Proceed” for work to begin on September 7, 1999. Following project completion on May 5, 2000, the City submitted a letter dated June 30, 2000, to the Maine Emergency Management Agency requesting additional funds in the amount of $331,541. FEMA and a Technical Assistance Contractor (TAC) reviewed the request and; subsequently, FEMA prepared DSR 58003 for $75,999 to adjust the final cost of the project.

The City submitted a first appeal on July 18, 2002, claiming that the excess costs were reasonable and necessary for the proper completion of the project and, therefore, eligible for reimbursement from FEMA. FEMA Region I staff, with the assistance of a TAC with expertise in dam construction projects, reviewed the project documentation to determine the degree to which any portion of the additional costs were necessary and reasonable. As a result, the FEMA Region I Regional Director partially approved the appeal on April 10, 2003, granting the City $96,683 in additional costs. The Regional Director denied the remaining $158,859 because it was not adequately supported by documentation and was therefore ineligible.

The City submitted its second appeal on June 13, 2003, requesting that FEMA reconsider the remaining $158,859 as eligible. The request is based on the City’s claim that these costs are adequately supported by documentation that establishes that they are eligible. FEMA did not prepare a DSR to implement the first appeal decision because the City chose to pursue a second appeal for the remaining $158,859.

FEMA reviewed the City’s second appeal letter and materials transmitted with it. In addition, as is our policy when reviewing second appeals, we reviewed the first appeal and FEMA’s findings regarding it. We determined that there are no additional eligible costs supported by the materials transmitted with the second appeal. In fact, there are items that were determined eligible in the first appeal, which are actually ineligible for reimbursement from FEMA. Proposed Change Order #11 for $875 to install a commemorative plaque is not eligible in accordance with FEMA regulations and will be deducted from the eligible amount. Also, lost productivity is not an eligible cost for reimbursement from FEMA. Therefore, the nine days time extension and the costs associated with it granted in the first appeal for lost productivity will be deducted from the eligible amount. These costs are $4,799 for Proposed Change Order #28, General Conditions, $23,232 for lost productivity, and $2,700 for liquidated damages. Thus, the eligible amount of the first appeal will be reduced to $65,077.

The documentation submitted by the City, although voluminous, does not provide any new information that supports its claim for the additional $158,859. Thus, the second appeal is denied. However, by copy of this letter, I am asking the Acting Regional Director to prepare a DSR to implement the first appeal determination, as revised by my decision regarding the second appeal.

Please inform the City of my decision. My determination constitutes the final decision on this matter as set forth in 44 CFR §206.206.

Sincerely,
/S/
Laurence W. Zensinger
Deputy Director
Recovery Division
Emergency Preparedness and Response

cc: Kenneth L. Horak
Acting Regional Director
FEMA, Region I