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Hopper Street Repairs

Appeal Brief Appeal Letter Appeal Analysis

Appeal Brief

Disaster1628-DR-CA
ApplicantCity of Petaluma
Appeal TypeSecond
PA ID#097-56784-00
PW ID#2285
Date Signed2012-08-13T04:00:00

Citation:         FEMA-1628-DR-CA, City of Petaluma, Hopper Street Repairs, PW 2285

Cross-

Reference:     Codes and Standards

Summary:       Flooding caused by FEMA-1628-DR-CA damaged Hopper Street in the City of Petaluma (Applicant).  Hopper Street is adjacent to a commuter rail line owned by the Sonoma-Marin Area Rapid Transit District (SMART).  The Applicant needed an encroachment permit from SMART before it could repair the damages to Hopper Street.  SMART requested that the Applicant construct new drainage facilities as part of the Hopper Street repairs because of concerns about storm water runoff from Hopper Street onto its rail line.  FEMA denied the Applicant’s request for funding to cover the costs of the new drainage facilities based on a determination that the SMART demands were not based on codes and standards that have been adopted and enforced by the Applicant.  The Applicant contends that it is required to comply with the SMART requirements and is therefore eligible to receive an additional $129,119 to construct new drainage facilities along the portions of Hopper Street that are going to be repaired.  The Applicant also maintains that FEMA improperly omitted $121,668 from the PW for certain road repair costs that were eligible.        

Issues:             1. Do current applicable codes, specifications, and standards require the construction of new drainage facilities adjacent to Hopper Street, as demanded by SMART?

                         2. Are the line items requested by the Applicant in the amount of $121,668 eligible to repair the damages to Hopper Street that were caused by the disaster?

Findings:         1. No.

                        2. Yes, in part. An additional $25,599 in estimated costs to repair the Hopper Street damages is considered eligible to restore the road to pre-disaster condition.

Rationale:       Subsection 406(e) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act; 44 CFR §206.226; Disaster Assistance Policy 9527.4, Construction Codes and Standards; Disaster Assistance Policy 9526.1, Hazard Mitigation Funding Under Section 406 (Stafford Act).

Appeal Letter

August 13, 2012

Mr. Mark Ghilarducci

Secretary

California Emergency Management Agency

3650 Schriever Avenue

Mather, California  95655

Re:       Second Appeal-City of Petaluma, PA ID 097-56784-00, Hopper Street Repairs,

            FEMA-1628-DR-CA, Project Worksheet (PW) 2285

Dear Mr. Ghilarducci:

This letter is in response to a letter from your office dated July 14, 2010, which transmitted the referenced second appeal on behalf of the City of Petaluma (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of $250,787 in funding for the repair of Hopper Street.

As explained in the enclosed analysis, I have determined that the new drainage facilities requested by the Applicant as part of obtaining a permit from the Sonoma-Marin Area Rapid Transit District (SMART) are not required by current applicable codes and standards and are not eligible for Public Assistance funding.  The Applicant is eligible to receive an additional $25,599 for the Hopper Street disaster repairs based upon the actual low bid scope and costs.  Accordingly, I am partially approving this appeal in the amount of $25,599.  By copy of this letter, I am requesting the Regional Administrator take the appropriate action to implement this determination.

Please inform the Applicant of my decision.  This determination is the final decision on this matter pursuant to 44 CFR §206.206, Appeals.

Sincerely,

/s/

Deborah Ingram

Assistant Administrator

Recovery Directorate

Enclosures

cc:        Nancy Ward

            Regional Administrator

            FEMA Region IX

Appeal Analysis

Background

During the 2005/2006 Winter Storm which resulted in disaster declaration FEMA-1628-DR-CA, flood waters inundated Hopper Street in the City of Petaluma, California (Applicant).  The flooding damaged 1,620 linear feet of Hopper Street.  On April 18, 2006, FEMA approved PW 1289 for estimated costs of $825,731 to restore nine road sites in Petaluma, one of which was Hopper Street.  In order to facilitate scope changes for the sites included in the original PW, FEMA de-obligated PW 1289 and replaced it with PW 2285.  FEMA prepared PW 2285 for $246,126 to address the damages caused by the flooding at Hopper Street.

On November 20, 2008, the Applicant sent a letter to the California Emergency Management Agency (Cal EMA) requesting a change in the scope of work for Hopper Street.  The basis for the requested change order was input the Applicant received from the Sonoma-Marin Area Rapid Transit District (SMART).  The damaged portion of Hopper Street is adjacent to a SMART commuter rail line, and the Applicant needed an encroachment permit from SMART before it could repair the Hopper Street damages.  SMART notified the Applicant in letters dated September 5 and November 17, 2008, as well as July 1, 2009, of its concern that the proposed Hopper Street repair could cause flooding along SMART’s rail line.  As a result of its concerns, SMART notified the Applicant that it would not issue an encroachment permit unless the Applicant added additional drainage facilities as part of the Hopper Street repairs.  Therefore, the Applicant requested an additional $129,119 to incorporate the additional drainage facilities that had been requested by SMART. 

On January 9, 2009, Cal EMA forwarded to FEMA the Applicant’s request for a change in the scope of work for the Hopper Street repair project.  Cal EMA noted that the drainage grades of the roadway and the roadway elevations were being modified to conform to current city codes and standards to prevent flood water from standing on the pavement.  Cal EMA recommended approval of the Applicant’s request based on a determination that the revised scope of work was dictated by SMART’s conditions for issuance of an encroachment permit.  On February 27, 2009, the Applicant submitted additional information which indicated it had awarded the Hopper Street repair project to North Bay Construction for $496,651.  On April 6, 2009, FEMA denied the Applicant’s request for a revised scope of work.  FEMA determined that the additional drainage facilities requested by SMART “are not required to repair the damaged facility to pre-disaster condition” and “getting an encroachment permit is not a codes and standards requirement.” 

First Appeal

The Applicant’s first appeal was submitted to Cal EMA on July 2, 2009.  In its appeal the Applicant argued that because it needed an encroachment permit from SMART to repair the damages to Hopper Street, the conditions imposed by SMART were equivalent to codes and standards with which the Applicant had to comply.  In addition, the Applicant argued that the proposed new drainage facilities would be “in conformance with the current American Railway and Maintenance of Way Association (ARMWA) guidelines, and be under the rules of both the California Public Utilities Commission (CPUC) and the Federal Railroad Administration (FRA) for both standard practice and safety.”  The Applicant also argued that its General Plan, its Storm-Water Management and Pollution Control Ordinance, and its Grading and Erosion Control Ordinance were local codes and standards that mandated the change in elevation and grade to Hopper Street.  Finally, the Applicant noted in its first appeal that in version 1 of PW 2285, FEMA had omitted costs that were eligible for FEMA assistance, and asked FEMA to include those omitted costs in the PW.

Cal EMA forwarded the Applicant’s first appeal to FEMA on September 2, 2009.  In summary, Cal EMA supported the Applicant’s first appeal, and it asked FEMA to 1) incorporate $129,119 into the project to cover the Applicant’s costs of compliance with SMART’s demands for additional drainage facilities, and 2) revise PW 2285 to “reflect the correct scope of work delineated in the original PW.”  FEMA responded to the Applicant’s first appeal on March 1, 2010.  FEMA denied the Applicant’s request for a change in the scope of work to address SMART’s demands for additional drainage facilities because those demands were not based on codes and standards that are eligible for FEMA assistance.  Additionally, FEMA approved partial funding of an additional $216,176 related to the original PW scope of work based on the accepted low bid for the project.  As a result of this determination, FEMA issued version 2 of PW 2285 to increase the eligible funding for the Hopper Street repairs to $462,302.

Second Appeal

The Applicant submitted its second appeal on May 11, 2010.  The Applicant argues that the demands which SMART imposed as a condition for the issuance of an encroachment permit were equivalent to a code requirement that had to be addressed and therefore is eligible for FEMA funding.  The second appeal states that “All changes are required by codes and standards, and dictated by good engineering practices.”  The Applicant is seeking $129,119 for the work requested by SMART.  The Applicant also requests an additional $121,668 for items omitted from the approved scope of work.  The Applicant requests that if the additional scope of work is not approved based on eligible codes and standards that the additional work be considered under FEMA’s Hazard Mitigation Program.

Cal EMA forwarded the second appeal to FEMA on July 14, 2010.  Cal EMA is supportive of the Applicant’s argument that FEMA improperly omitted a number of bid items when it prepared PW 2285, and it urges FEMA to obligate an additional $121,668 to address the omitted items.  However, in the second appeal Cal EMA declines to support the Applicant with respect to the SMART demands “as it appears that the proposed requirements constitute an improved project.” 

Discussion

Section 406(e) of the Robert T. Stafford Disaster Relief Act and Emergency Assistance Act (Stafford Act) defines “eligible cost” as “the cost of repairing…a public facility…on the basis of the design of such facility as it existed immediately prior to the major disaster and in conformity with current applicable codes, specifications, and standards….” (emphasis added).  FEMA has developed several forms of guidance for use in implementing the “codes and standards” provision of the Stafford Act.  FEMA’s implementing regulation at Title 44 Code of Federal Regulations (44 CFR) §206.226(d) Restoration of damaged facilities, Standards, states:  “For the costs of Federal, State, and local repair…standards which change the pre-disaster construction of [a] facility to be eligible, the standards must (1) Apply to the type of repair…required; (2) Be appropriate to the pre-disaster use of  the facility; (3) Be found reasonable, in writing, and formally adopted and implemented by the…local government on or before the disaster declaration date…(4) Apply uniformly to all similar types of facilities within the jurisdiction of the owner of the facility; and (5) For any standard in effect at the time of a disaster, it must have been enforced during the time it was in effect.”  In addition, Disaster Assistance Policy (DAP) 9527.4, Construction Codes and Standards, provides detailed guidance relating to FEMA’s implementation of the “codes and standards” provision of the Stafford Act.

The first issue in this appeal is whether the SMART demands are based on “current applicable codes, specifications, and standards” pursuant to Section 406(e) of the Stafford Act.  In its July 1, 2009, letter to the Applicant, SMART stated that it “is a state of California public agency.  Any time there is any change or improvement done within the SMART Right-of-Way, SMART requires that the changes be done under the current SMART standards, to also be in conformance with the current American Railway and Maintenance of Way Association (ARMWA) guidelines, and be under the rules of both the California Public Utilities Commission (CPUC) and the Federal Railroad Administration (FRA) for both standard practice and safety.”  Although the Applicant’s first appeal quoted from SMART’s July 1, 2009, letter, and referred to “current SMART standards”, as well as ARMWA, CPUC and FRA standards, the Applicant did not cite any specific construction codes that were developed by SMART, the ARMWA, the CPUC, or the FRA.  The Applicant did not show that SMART had authority to develop and enforce construction codes and standards.

The Applicant also cited in its first appeal the Petaluma General Plan, which requires the City of Petaluma “to protect the community from risk of flood damage,” the Petaluma Storm-Water Management and Pollution Control, which “establishes requirements to help the City comply with the Federal Water Pollution Control Act”, and the Petaluma Grading and Erosion Control Ordinance, the purpose of which is to “ensure the health, safety, and general welfare of citizens” within Petaluma.  Nevertheless, the Applicant did not cite in its first appeal any specific code provisions from its General Plan or Ordinances which require the Applicant to construct the new drainage facilities that SMART demanded.

DAP 9527.4, Construction Codes and Standards, Section VII(C) cites the five codes and standards criteria that are contained in 44 CFR §206.226(d) and elaborates on those regulations.  In the context of this appeal the two most noteworthy of those five criteria are 44 CFR §206.226(d)(3) and (5).

44 CFR §206.226(d)(3) dictates that codes and standards must “Be found reasonable, in writing, and formally adopted and implemented by the State or local government.”  Section VII(C)(3)(b) of DAP 9527.4 describes FEMA’s interpretation of the “formal adoption” requirement of the regulation.  It states that the formal adoption mandate “requires that all the requisite steps and actions have been taken by the appropriate legislative body or regulatory authority within the jurisdiction….The adopted code must be formally incorporated into the building code or the local ordinance.  Design standards, guidelines, policies, industry practices, or other non-mandatory provisions are not acceptable.”  Section VII(C)(3)(c) of DAP 9527.4 states that “FEMA does not recognize codes adopted by private non-profit organizations when determining eligible work.  FEMA also does not accept codes adopted by agencies or divisions of State or local governments that are not authorized to set codes or standards applicable to all similar type facilities within the broad governmental jurisdiction of the State or local government….”  Finally, Section VII(C)(5)(b) elaborates on

44 CFR §206.226(d)(5), and it notes that “a code must be enforced in a manner that imposes the same requirements on all projects without regard to ownership….The code cannot be subject to discretionary enforcement by building or permitting officials….”

The provisions of DAP 9527.4 that are cited in the preceding paragraph indicate that SMART’s demand for new drainage facilities as a condition of its providing the Applicant with an encroachment permit are not equivalent to “codes and standards” under Section 406(e) of the Stafford Act.  Although the Applicant has cited numerous documents which it argues are codes that establish its eligibility for funding under Section 406(e), none of those documents contain objective standards based on specific design criteria.  Most of the documents cited contain generic guidance, which are not equivalent to a mandatory code or standard.  In addition, the Applicant has not documented that SMART has the authority to adopt and enforce construction codes and standards.

The second issue in this appeal is whether the thirteen bid items in the amount of $121,668 that the Applicant contends have been improperly omitted from the PW are required by codes and standards and are therefore eligible for FEMA assistance.  As indicated (highlighted) in the attached spreadsheet, most of the items identified by the Applicant in its second appeal are related to new drainage elements designed by the Applicant to improve intercepting, collecting and conveying storm water not only from Hopper Street, but to lessen potential runoff onto the adjacent SMART right of way.  These items are intertwined with the new drainage facilities that SMART has required and are considered improvements to the pre-disaster Hopper Street design.  Therefore, the Applicant is not eligible to receive funding for this portion of the second appeal request.

Finally, the Applicant requests that if the additional scope of work is not approved based on eligible codes and standards that the additional work be considered under FEMA’s Hazard Mitigation Program.  FEMA Response and Recovery (RR) Policy 9526.1, Hazard Mitigation Funding Under Section 406 (Stafford Act), dated August 13, 1998, states that mitigation measures must: 

·         be related to eligible disaster-related damages and must directly reduce the potential of future, similar disaster damages to the eligible facility,

·         be determined to be cost effective, and

·         be approved by FEMA prior to funding.

The proposed additional work is not directly related to the damaged elements of the facility (Hopper Street), the Applicant has not demonstrated the cost effectiveness of the project or that it will directly reduce future, similar disaster damage to Hopper Street, and finally FEMA did not give approval for the additional work to be done prior to funding.  Therefore, the additional work proposed by the Applicant cannot be considered as a 406 Hazard Mitigation project. 

Upon review of the remaining items, some were found to be eligible or partially eligible.  As indicated in the attached spreadsheet, the Applicant is eligible to receive $21,494 to cover the cost of a project superintendent, $11,892 for the costs of removing and replacing 4” asphalt concrete (AC) at the intersection of the road and adjacent driveways, and $13,007 for the costs of additional hot asphalt mix.  The Applicant is also eligible to receive $6,314 to cover the cost of stabilization fabric at the Hopper Street repair site.  In addition, as noted in the attached spreadsheet, the Applicant is eligible to receive an additional $2,755 for costs associated with Geotechnical Soils and Testing, Construction Administration and Inspection, and Surveying activities.  The total estimate of this supplemental funding is $55,462.

As detailed in the attached spreadsheet, several additional items have been adjusted to reflect the actual bid for the Hopper Street repair project.  Specifically, the cost of item 1.18 (striping), as well as the cost for mobilization/demobilization and saw cutting (previously estimated by FEMA) were reduced to reflect actual costs.  In addition, the amount estimated for engineering and design services was reduced from $47,490 to $30,961 in accordance with the version of FEMA 322, Public Assistance Guide, dated October 1999 that was in effect at the time of FEMA-1628-DR-CA.  The revised apportionment of engineering and design services costs is based on the ratio of eligible costs compared to ineligible hard costs.  The total amount of the reduction is $29,863.     

Conclusion

The Applicant has not documented that SMART’s conditions for granting an encroachment permit are based on “current applicable codes, specifications, and standards,” and it has failed to document the eligibility for the costs of constructing the new drainage facilities proposed by SMART.  In addition, the Applicant is not eligible for assistance from FEMA to pay for the costs of the drainage facilities that it claims FEMA improperly omitted from PW 2285.  The Applicant is eligible to receive $6,314 for stabilization fabric as an eligible hazard mitigation activity, $21,494 for the cost of a superintendent, $11,892 for the cost of removing and replacing 4” of AC at the intersection of the damaged portions of Hopper Street and adjacent driveways, $13,007 for additional asphalt, and $2,755 for various other activities.  Pursuant to the alignment of the scope of work and costs for the Hopper Street repair project, the amount of assistance the Applicant is eligible to receive was reduced by $29,863.  Therefore, the appeal is partially approved in the amount of $25,599.

 

Item Description

Amount

Project Superintendent

 $21,494

Additional Asphalt

 $13,007

Removal & Replacement of 4” AC

 $11,892

Reduce cost of Item 1.18 Striping

($214)

Stabilization Fabric

 $  6,314

Mobilization/Demobilization Reduction

($12,000)

Saw Cut AC Reduction

($1,120)

Engineering & Design Services Reduction

($16,529)

Geotechnical Testing (3% of new subtotal)

 $1,181

Construction Admin & Inspection (3% of new subtotal)

 $1,181

Survey (1% of new subtotal)

  $393

Total

 $25,599