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Debris Removal

Appeal Brief Appeal Letter

Appeal Brief

DisasterFEMA 1551-DR
ApplicantEscambia County
Appeal TypeSecond
PA ID#033-99033-00
PW ID#Project Worksheet
Date Signed2008-08-27T04:00:00
Citation: FEMA-1551-DR-FL, Escambia County, FL, PW 3565, Debris Removal

Summary: Following Hurricane Ivan, Escambia County (Applicant) requested $8,994,725 for removing stumps. On May 31, 2005, the Federal Emergency Management Agency (FEMA) prepared Project Worksheet (PW) 3565 for $3,636,253 for eligible stump removal costs, but disallowed $5,358,472 because the Applicant removed stumps from some ineligible locations and removed stumps 24 inches or less in diameter on a per-stump basis instead of the recommended cubic-yard basis.

In a letter dated March 9, 2006, the Applicant filed a first appeal requesting that FEMA reimburse in full the cost of stump removal. In a letter dated November 13, 2007, the Regional Administrator denied the Applicant’s first appeal because the Applicant removed 5,475 stumps from Federal Aid roads, private roads and other ineligible locations, and the Applicant claimed costs for removing stumps 24 inches or less in diameter on a per-stump basis as stipulated in the memorandum dated May 13, 2005, from the former Director of Recovery. The memorandum stated that stumps 24 inches or less in diameter should be reimbursed at the cubic-yard rate for regular vegetative debris rather than on a per-stump basis. The Applicant’s second appeal dated February 26, 2008, reiterates its position that $3,852,614 for unit contract costs associated with the removal of stumps less than 24 inches in diameter are eligible based on the guidance that existed at the time the work was completed.

Issues: Are costs for removing stumps 24 inches or less in diameter on a per-stump basis eligible for Public Assistance funding?

Findings: No.

Rationale: 44 CFR §206.224; FEMA 325, Debris Management Guide, dated April 1999;
OMB Circular A-87, Cost Principles for State, Local and Tribal Governments.

Appeal Letter

August 27, 2008

W. Craig Fugate
Director Division of Emergency Management
Florida Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, Florida 32399-2100

Re: Second Appeal–Escambia County, PA ID 033-99033-00, Debris Removal, FEMA-1551-DR-FL, Project Worksheet (PW) 3565
Dear Mr. Fugate:
This letter is in response to your letter dated February 26, 2008, which transmitted the referenced second appeal on behalf of the Escambia County (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of $3,851,615 for stump removal costs.
On November 30, 2004, FEMA issued Disaster Specific Guidance (DSG) 17, Eligibility of Stump Removal Costs, to provide disaster specific guidance on stump removal eligibility. On May 13, 2005, the former Director of the Recovery Division issued a memorandum that clarified the applicability of DSG 17 and ambiguities in the guidance pertaining to stump excavation and removal. In particular, it stated that FEMA would reimburse applicants on the basis of a cubic-yard conversion rate for the removal of eligible stumps with diameters of 24 inches or less. On November 5, 2005, PW 3565 obligated $3,636,253 using an equivalent cubic-yard basis as explained in the above mentioned guidance. This amount was $5,358,472 less than the Applicant requested.
In a letter dated March 9, 2006, the Applicant submitted its first appeal requesting that FEMA reimburse in full the $8,994,725 contract cost of stump removal. The Applicant contended that FEMA applied DSG 17 and the Director of Recovery’s memorandum retroactively months after its contracted work was completed. In a letter dated November 13, 2007, the Regional Administrator denied the Applicant’s first appeal because the Applicant did not submit documentation to support the eligibility of the 5,475 stumps and because the per-stump unit costs were determined to be unreasonable.

In a letter dated February 26, 2008, the Applicant submitted its second appeal. The Applicant did not contest the $1,506,857 associated with FEMA’s eligibility decision on the 5,475 disallowed stumps, but reiterated its position that the $3,851,615 associated with the removal of stumps 24 inches in diameter or less are eligible based on the guidance that existed at the time the work was completed. The Applicant claims that FEMA’s retroactive decision to reimburse costs associated with the removal of stumps 24 inches or less in diameter on the cubic-yard basis is not consistent with the congressional objective of the Stafford Act. The Applicant further asserted that FEMA 325, Debris Management Guide, makes no reference to a requirement for volumetric conversion of stumps 24 inches or less or the reimbursement for removal cost at cubic-yard rates instead of premium prices per individual stump.

The Office of Management and Budget Circular A-87, Cost Principles for State, Local and Tribal Governments, requires that all Federal grant costs be reasonable. FEMA has determined that the reimbursement of the removal of stumps on a per-stump basis is not reasonable. The former Director of the Recovery Division’s memorandum dated May 13, 2005, clarified existing FEMA guidance on eligibility of stump removal costs. It did not retroactively apply new guidance. After reviewing the information submitted with the appeal, I have determined that the Regional Administrator’s decision on the first appeal is consistent with program guidance. Therefore, the Applicant’s request for $3,851,615 for costs associated with the removal of stumps 24 inches or less in diameter is denied.
Please inform the Applicant of my decision. My determination constitutes the final decision on this matter as set forth in 44 CFR §206.206.
Sincerely,
/s/

Carlos J. Castillo Assistant Administrator Disaster Assistance Directorate
cc: Major Phil May Regional Administrator FEMA Region IV