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Second Appeal Brief
PA ID# 000-U5P35-00; Washington State Department of General Administration
PW ID# Multiple Project Worksheets; OIG Audit Report DS-07-01
Citation: FEMA-1361-DR-WA, Washington State Department of General Administration, Office of Inspector General (OIG) Audit Report DS-07-01, Multiple Project Worksheets (PWs)
Reference: Reasonable Cost, Improved Project, Pre-Existing Condition
Summary: Several facilities under the authority of the State of Washington Department of General Administration (Applicant), including the Washington State Legislative Building, sustained damages as a result of the Nisqually Earthquake. FEMA obligated three versions of PW 1567, for a total of $11,171,098 for the design and construction of repairs and hazard mitigation for the Legislative Building, based on cost estimates prepared using the Cost Estimating Format (CEF). The Applicant requested and FEMA approved an Improved Project for PW 1567. The OIG conducted an audit of the Applicant’s grant and presented the findings in Audit Report DS-07-01. The OIG questioned $4,899,578 claimed by the Applicant; the majority of the questioned costs ($4,792,035; Findings A–D) were associated with the Legislative Building repairs (PW 1567). Findings A through D were related to the improper use of the CEF, repair costs that were not earthquake related, hazard mitigation measures on undamaged elements of the facility, and claimed costs that exceeded the improved project cap. The Applicant submitted a first appeal of FEMA’s intent to de-obligate the costs questioned by the OIG. The Acting Regional Administrator denied the Applicant’s appeal, concluding that the documentation on file was not sufficient to support the Applicant’s position. The Applicant submitted a second appeal, requesting FEMA not de-obligate $4,476,413 in costs questioned by the OIG. The Applicant addressed each finding in detail and submitted voluminous documentation in support of the appeal.
Issues: 1. Is the approved cost estimate reasonable with no errors or omissions?
2. Did the approved scope of work include repair of non-disaster related damage?
3. Did the approved hazard mitigation measures address undamaged elements of the facility?
Findings: 1. No. FEMA used inappropriate factors in the CEF and made inaccurate conclusions regarding the project timeline.
Rationale: Office of Management and Budget Circular A-87; 44 CFR §202.203(d)(1); Response and Recovery Policy 9526.1, Hazard Mitigation Funding Under Section 406 (Stafford Act)