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Direct Result of Disaster

Appeal Brief Appeal Letter Appeal Analysis

Appeal Brief

Disaster1603-DR-LA
ApplicantLouisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans
Appeal TypeSecond
PA ID#000-UURAV-00
PW ID# 20644
Date Signed2015-01-28T00:00:00

Conclusion: The contract security services performed at Charity Hospital from August 2010 to June 2012 are neither work required as a direct result of a disaster as required by 44 C.F.R. § 206.223(a), nor an eligible emergency protective measure as defined by 44 C.F.R. § 206.225(a).

Summary Paragraph

In August 2005, Hurricane Katrina caused extensive damage to Charity Hospital, which was closed immediately following the storm and has since remained closed.  From August 2010 to June 2012, the Applicant secured the building contents by utilizing contract security services consisting of foot and mobile patrol officers around the vacant building, for a total cost of $592,920.32.  FEMA prepared PW 20644 for zero dollars for this work, finding that the security services did not constitute an eligible emergency protective measure.  In its first appeal, the Applicant argued that FEMA requested that the building contents be secured until the valuation process was completed.  The Applicant also stated that the valuation process was not completed until December 2012.  Upon review, the Regional Administrator denied the first appeal based on the finding that the security services provided five to seven years after the disaster did not meet eligibility requirements of an emergency protective measure.  In its second appeal, the Applicant requests reconsideration, claiming that the security services were necessary to avoid damage resulting from theft and vandalism, as well as to protect the public from exposure to any dangerous material within the hospital. 

Authorities and Second Appeals

  • Stafford Act § 403
  • 44 C.F.R. § 206.223(a).
  • 44 C.F.R. § 206.223(e).
  • 44 C.F.R. § 206.225(a)(1).
  • 44 C.F.R. § 206.225(a)(3).
  • PA Guide, at 23 (Oct. 1999).
  • PA Guide, at 50.

Headnotes

  • 44 C.F.R. § 206.223(a) states that to be eligible for financial assistance, an item of work must be required as the result of the major disaster.  The PA Guide specifies that work must be required as a direct result of the declared disaster.
  • The contract security services were performed to avoid theft and vandalism, and other potential consequences of such criminal acts five to seven years after the event.  This work was not required as a direct result of the major disaster; therefore, the work is ineligible for financial assistance.
  • 44 C.F.R. § 206.225(a)(1) provides that emergency protective measures to save lives, to protect public health and safety, and to protect improved property are eligible.  44 C.F.R. § 206.225(a)(3) further provides that eligible emergency protective measures must: (i) eliminate or lessen immediate threats to life, public health or safety; or (ii) eliminate or lessen immediate threats of significant additional damage to improved public or private property through measures which are cost effective.
    • The contract security services provided five to seven years after the disaster did not serve to eliminate or lessen any immediate threat.
    • The contract security services were performed to avoid theft or vandalism, which are not considered an immediate threat from a hurricane disaster event.

 

Appeal Letter

January 28, 2015

Kevin Davis
Director
Governor’s Office of Homeland Security and Emergency Preparedness
7667 Independence Boulevard
Baton Rouge, Louisiana 70806

Re:  Second Appeal – Louisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans, PA ID 000-UURAV-00, FEMA-1603-DR-LA, Project Worksheet (PW) 20644

Dear Mr. Davis:

This is in response to your letter dated May 13, 2014, which transmitted the referenced second appeal on behalf of Louisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of $592,920.32 in funding for contract security services at Charity Hospital. 

As explained in the enclosed analysis, I have determined that the contract security services provided at Charity Hospital five to seven years after Hurricane Katrina are not work required as a direct result of a disaster, nor are they an eligible emergency protective measure.  Therefore, I am denying this appeal. 

Please inform the Applicant of my decision.  This determination constitutes the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.

Sincerely,

/s/

William W. Roche
Director
Public Assistance Division

Enclosure

cc:  George A. Robinson
       Regional Administrator
       FEMA Region VI

Appeal Analysis

Background

On August 29, 2005, heavy rains and wind from Hurricane Katrina caused significant damage to Charity Hospital located in New Orleans, Louisiana. The hospital was closed immediately following the storm and has since remained closed.  The State of Louisiana, Facility Planning and Control (FP&C) was legally responsible for the hospital building facility, while Louisiana State University Health Care Services Division Medical Center of Louisiana at New Orleans (LSU HCSD MCLNO or Applicant), had legal responsibility for the day-to-day operation of the hospital and all its contents and equipment, except permanently fixed equipment.

On November 21, 2008, the US Department of Veterans Affairs, FEMA, the City of New Orleans, the Louisiana State Historic Preservation Officer, and the Advisory Council on Historic Preservation entered into a programmatic agreement to minimize adverse effects to historic properties affected by decisions to repair or replace certain historical New Orleans medical facilities, including Charity Hospital, pursuant to Section 106 of the National Historic Preservation Act (NHPA).[1]  According to the agreement, FP&C performed “secure and ventilate” asset protective measures to secure the hospital facility and preserve character-defining historic building features from deterioration or damage.  Security measures performed included the following: securing windows with rolling shutter doors to prevent access; securing strategic doors to prevent unauthorized entry into the building; installing access lighting throughout the facility including the basement, corridors, and mechanical areas; and installing a 6-foot chain link fence with barbed wire around the facility perimeter. FEMA subsequently provided over $3.9 million in Public Assistance (PA) funding for this work in Project Worksheet (PW) 19731.[2]

In January 2010, Charity Hospital was deemed eligible for replacement.  Subsequently, FEMA determined that all building contents on all 20 floors of Charity Hospital were completely damaged, with the exception of a small quantity of items removed from the hospital following Hurricane Katrina for use at temporary facilities.[3]  The costs associated with the proper removal and disposal of all damaged building contents were provided in PW 20370.[4]

On April 27, 2012, the Applicant requested a new Category B PW for emergency work to provide security services at Charity Hospital.  The Applicant submitted invoices for contract security services procured between August 6, 2010 and June 7, 2012, for a total amount of $592,920.32.  Security services consisted of one foot patrol officer at all times, one mobile patrol officer during nights and weekends, and one lead officer during the regular work week.

On March 13, 2013, FEMA obligated PW 20644 for zero dollars, because the security services did not meet emergency work requirements as defined by Title 44 of the Code of Federal Regulations (C.F.R.) Section 206.225.[5]  FEMA determined that the timeframe of the security services—five to seven years after the declared disaster—did not demonstrate an immediate need necessary for emergency work and that security was provided mainly to prevent theft or vandalism, which were not considered disaster-related damage.  FEMA noted that FP&C had already completed its “secure and ventilate” project, which consisted of passive security measures to prevent further damage from environmental conditions and vandalism.  Finally, FEMA found that the time period of the security services did not overlap or end concurrently with the intended schedule for sorting and disposing of the building contents, which started in January 2013.

First Appeal

On March 23, 2013, the Applicant submitted its first appeal to the Grantee, requesting that FEMA obligate the $592,940.32 denied on PW 20644.  The Grantee transmitted the Applicant’s first appeal to FEMA Region VI, indicating its support of the appeal, on June 10, 2013.  As a basis for the appeal, the Applicant claimed that FEMA requested that the hospital building be secured so that no assets would be destroyed or removed until a thorough review had been completed.  The Applicant contended that the valuation process was not finalized until December 2012.

The FEMA Region VI Regional Administrator (RA) denied the first appeal on January 2, 2014.  The RA determined that the security services did not meet eligibility requirements to be considered an eligible emergency protective measure in accordance with 44 C.F.R. §206.225.[6]  The RA stated that the security services provided approximately five to seven years after the disaster did not serve to eliminate or reduce any immediate threats.  Additionally, the RA noted that FP&C had previously rendered the facility secure.

Second Appeal

On May 13, 2014, the Grantee transmitted the Applicant’s second appeal letter dated March 1, 2014, indicating its support of the appeal.  In the second appeal, the Applicant reiterated its request for reconsideration of the denied funding for contract security services provided at Charity Hospital in the amount of $592,940.32. 

The Applicant asserts that the passive security measures in place (as performed by FP&C), such as securing windows/doors and installing lights/fences with barbed wire around the facility perimeter, are not sufficient to completely prevent crime, remove vagrants, or deter future damage to the exterior, interior, or assets of a historic site such as Charity Hospital.  The Applicant further explains that, based on the type of structure (a historic site), the geographical location (a crime-ridden area), the numerous previous attempts of theft, loss, vagrancy, unauthorized entry, and threats to entry, a fence is not sufficient to completely secure the facility.  The Applicant also claims that the contract security personnel have removed vagrants, persons attempting to steal copper, and persons attempting to cause structure damages to the historic site. 

The Grantee supports the Applicant’s arguments and elaborates that while the hospital stood empty, security was necessary to safeguard the property and the costly medical equipment and supplies left behind.  According to the Grantee, the Applicant believed that if it had not secured the equipment and the building contents and they got further damaged, FEMA could have considered it negligence and ineligible for reimbursement.  Finally, the Grantee claims that failure to protect and safeguard the building contents could have jeopardized the public’s safety by potentially exposing the public to various biohazards and/or dangerous equipment located inside the hospital.

Discussion

Direct Result of Disaster

Section 403 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) authorizes FEMA to provide assistance essential to meeting immediate threats to life and property resulting from a major disaster, including reduction of immediate threats to life, property, and public health and safety.[7]  Further, 44 C.F.R. § 206.223(a)(1) provides that an item of work must be required as the result of the major disaster event to be eligible for financial assistance.  Additionally, the Public Assistance Guide specifies that work must be required as a direct result of the declared disaster.[8]

In this case, the security services provided were not work required as a direct result of the declared disaster.  Here, Hurricane Katrina caused property damage, requiring Charity Hospital to be closed. The closure increased the hospital’s exposure to potential threats of theft and vandalism.  While FEMA does not dispute that theft and vandalism may present risks to the hospital facility and its contents, these risks, especially five to seven years after the event, are not direct results of the disaster.  Rather, they are ordinary risks of crime that would typically be present both before and after a disaster such as Hurricane Katrina.  Accordingly, because the declared disaster, in itself, did not directly cause theft or vandalism, or any threat thereof, the security provided to prevent theft and vandalism was not work required as a direct result of the declared disaster.  Thus, it is ineligible for PA funding.  

The Applicant also argues that security was provided not only to guard the hospital against theft and vandalism, but also to ensure public safety against potential exposure to various biohazards and dangerous equipment located inside the hospital.  However, the threat of such potential exposure to the general public at large was not a direct result of the disaster.  The potential threat would have materialized only upon unlawful access and use of the biohazards and dangerous equipment.  This would be considered a direct result of a criminal act independent of the disaster.  Therefore, any security provided to ensure public safety against potential threats from a criminal act was not eligible work required as a direct result of the disaster.

Emergency Protective Measures

Pursuant to 44 C.F.R. § 206.225(a)(1), emergency protective measures performed to save lives, to protect public health and safety, and to protect improved property are eligible.  The regulations further provide that eligible emergency protective measures must eliminate or lessen immediate threats to life, public health or safety, or eliminate or lessen immediate threats of significant additional damage to improved public or private property through cost-effective measures.[9]

The PA Guide defines the term an “immediate threat” as the threat of damage from an event that could reasonably occur within 5 years.[10]  Immediate threat from a hurricane event, such as Hurricane Katrina, may be a 5-year flooding event that could cause damage or threaten lives, public health, and safety.[11]  Accordingly, emergency protective measures performed to eliminate or lessen such immediate threats (e.g., temporarily covering a wind-damaged roof with a tarp) would be eligible. However, threats of theft, vandalism, or any public exposure to hazardous materials resulting from criminal acts more than five years after the event are not immediate threats as defined by the PA Guide.  As such, because the security services performed did not eliminate or lessen an immediate threat, as described in the PA Guide, they are ineligible for PA funding.

Furthermore, the Applicant believed that the security services were necessary to avoid any potential negligence on its part that may have resulted from failure to adequately secure the hospital building contents before inventory and valuation were completed.  FEMA agrees that avoiding negligence is a valid concern, as, pursuant to 44 C.F.R. §206.223(e), no assistance would be provided to an applicant for damages caused by its own negligence.[12]  Nevertheless, in this case, the security services did not address an immediate threat, as defined by FEMA guidelines.  FEMA notes that the FP&C secure and ventilate project was intended to prevent further damage to the hospital building (FP&C’s legal responsibility) and also served to protect the building contents (Applicant’s legal responsibility) by restricting access to the building itself.  Consequently, issues associated with theft and vandalism that might have been present in the immediate aftermath of Hurricane Katrina would have been addressed by that project.  Any additional security services procured by the Applicant were not eligible emergency protective measures as outlined in regulations and guidelines.[13]  As such, the work is ineligible for PA funding.

Reasonable Cost

In the second appeal, the Grantee asserted that the Applicant provided sufficient justification that the security services were provided at reasonable cost.  However, as the work itself is not eligible, FEMA will not determine whether the costs were reasonable.

Conclusion

The contract security services performed at Charity Hospital from August 2010 to June 2012 are neither work required as a direct result of a disaster, nor an eligible emergency protective measure.  Therefore, the work is ineligible for PA funding.  


[1] See Programmatic Agreement among the US Department of Veterans Affairs, the Federal Emergency Management Agency, the City of New Orleans, the Louisiana State Historic Preservation Officer, and the Advisory Council on Historic Preservation Regarding the Funding to Repair or Replace Healthcare Facilities Comprising the VA Medical Center and the Medical Center of Louisiana at New Orleans (Nov. 21, 2008).

[2] Project Worksheet 19731, Facility Planning and Control, State of Louisiana, Version 0 (Oct. 6, 2011).

[3] Project Worksheet 20370, LSU HCSD MCLNO, Version 0 (Oct. 15, 2012).

[4] Id.

[5] See 44 C.F.R. §206.225 (2004)

[6] See 44 C.F.R. §206.225.

[7] The Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1988, Pub. L. No. 93-288, §403, 42 U.S.C. § 5170b (1988).

[8] Public Assistance Guide, FEMA 322, at 23 (Oct. 1999) [hereinafter PA Guide].

[9] 44 C.F.R. § 206.225(a)(3).

[10]PA Guide, at 50.

[11] See PA Guide, at 50 (stating that “[f]or a flood, the immediate threat exist if a 5-year flooding event could cause damage or threaten lives, public health, and safety.  This is not a flood that necessarily happens within 5 years, but a flood that has a 20 percent chance of occurring in any given year.”).

[12] 44 C.F.R. § 206.223(e).

[13] See 44 C.F.R. § 206.225(a); see also PA Guide, at 50.