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Second Appeal Brief
PA ID# 047-UGYND-00; Roman Catholic Diocese of Brooklyn
PW ID# Multiple PWs; Duplication of Benefits
Conclusion: Pursuant to the Stafford Act § 312, FEMA funding to repair the Roman Catholic Diocese of Brooklyn’s facilities is prohibited as it constitutes a duplication of benefits due to the Applicant’s secondary insurance policy.
Hurricane Irene caused flooding throughout Queens and Kings Counties, New York. Several of the Applicant’s facilities were impacted by the disaster. FEMA prepared PWs 5098, 5357, 5411, 5419, 5439, 5657, 5662, 5944, 6212, 6218, 6477, 6483, 7117, 7816 and 7889 to address repairs necessary to restore the facilities to pre-disaster condition. A FEMA Insurance Specialist reviewed the PWs and made cost reductions based on anticipated and actual insurance proceeds. The Applicant had two insurance policies in place at the time of the disaster. The primary insurance policy was in the amount of $70 million with a deductible of $250,000. The secondary policy was with Peter Turner Insurance Company (PTIC). The PTIC policy provided $250,000 of coverage with a $750 deductible. All, but one, of the PWs were obligated for a zero-dollar amount based on the duplication of benefits—PTIC policy payout and Public Assistance funding—that would result if the PWs were obligated. The PTIC deductible—$750.00 per occurrence—was funded in PW 5419. In the first appeal, the Applicant asserted that the PTIC policy provided self-insurance retention coverage, and thus, not a duplication of benefits. The Region II Acting Regional Administrator (RA) denied the first appeal because she determined that PTIC was licensed and regulated by the New York State Insurance Department. As such, PTIC issued a policy covering the facilities listed for damage caused by Hurricane Irene. The total amount of damage was under the $250,000 coverage amount; therefore, under the Stafford Act § 312, Duplication of Benefits, was not eligible for PA funding. In the second appeal, the Applicant argues that its contract with PTIC does not constitute insurance because there is no risk shifting or risk distribution involved. Accordingly, the Applicant contends that there is no duplication of benefits.
Authorities and Second Appeals
- City of Chicago v. FEMA, 2013 U.S. Dist. LEXIS 41633 (2013).
- Stafford Act § 312, 42 U.S.C. § 5155.
- 44 C.F.R. § 206.250(c).
- Catholic Bishop of Chicago, FEMA-1800-DR-IL, 18 PWs
- PA Guide, at 41.
- Stafford Act § 312 prohibits FEMA from providing assistance to any entity for any loss for which financial assistance has already been received from any other program, from insurance, or from any other source.
- The Stafford Act does not define “insurance.” However, based on the ordinary meaning of “insurance,” the Applicant’s subsidiary policy with PTIC constitutes insurance.
- According to the PA Guide and City of Chicago v. FEMA, the Stafford Act § 312 applies to a duplicative benefit for the same item of work from “any other source,” including a private contract where consideration was given for a benefit incurred.
Here, even if FEMA determined that the PTIC policy was not insurance, it would still constitutes a duplication of benefits because PTIC is obligated to compensate the Applicant for losses incurred with respect to the facilities in the PWs listed.