Documentation

Appeal Brief

Summary Paragraph Between April 30, 2010 and May 18, 2010, severe rainstorms, tornadoes, and straight-line winds impacted Nashville-Davidson County.  The rainstorms caused the Cumberland River to overflow and submerge the hot house building located at the Applicant’s Metropolitan Water Services Biosolids Facility.  Floodwaters submerged the building, damaging electrical components found in and near the building.  FEMA subsequently prepared Project Worksheet (PW) 5524 documenting necessary repairs to a transformer, an instrument panel, two variable frequency drives, and a second transformer located outside the building.  The PW did not document resident engineering costs and partially disallowed Direct Administrative Costs (DAC).  On June 3, 2011, the Applicant submitted its first appeal requesting $18,161.18 and arguing FEMA made errors in estimating DAC and resident engineering costs.  In a letter dated May 2, 2012, the FEMA Region IV Regional Administrator (RA) denied the appeal, finding that the the work associated with the hot house did not need the services of resident engineers, and the activities claimed as DAC actually involved procurement and payment activities that amounted to project management costs not DAC.  On July 24, 2012, the Applicant submitted a second appeal based solely on resident engineering costs.  The documentation provided with the Applicant’s second appeal submission was insufficient to show the services of resident engineers were necessary to complete work on the hot house.  

Authorities and Second Appeals

• Stafford Act § 406 (a)(1)(A), 42 U.S.C. § 5172.

• PA Digest, at 48.

• PA Guide, at 57.

Headnotes

• PA Digest, at 48, provides that “[s]pecial services[,] which are not required on every restoration project, include engineering surveys, soil investigations, services of a resident engineer, and feasibility studies. These services must be specifically described and must be shown to be necessary for completing the eligible scope of work.”

  • The Applicant did not provide sufficient documentation to show the services of resident engineers were necessary.

Appeal Letter

Appeal Analysis

Background

Between April 30, 2010 and May 18, 2010, severe rainstorms, tornadoes, and straight-line winds impacted Nashville-Davidson County (Applicant).  The rainstorms caused the Cumberland River to overflow, and the resulting floodwaters damaged the Applicant’s Central Waste Water Treatment Plant as well as different buildings at the Applicant’s Metropolitan Water Services Biosolids Facility (Biosolids Facility), part of the Waste Water Treatment Plant. 

At the time of the weather event, floodwaters submerged the Biosolid Facility’s effluent pump station—also known as the hot house building.  The floodwaters damaged electrical components found in and near the building.  FEMA subsequently prepared Project Worksheet (PW) 5524 documenting necessary repairs to a transformer, an instrument panel, two variable frequency drives, and a second transformer located outside the building.  The PW did not document resident engineering costs and partially disallowed Direct Administrative costs (DAC).

First Appeal

The Applicant submitted a first appeal by letter dated June 3, 2011, arguing that FEMA made scope and cost estimate errors and requesting a total reimbursement of $18,161.18.  The Applicant sought additional DAC funding for costs it asserted were incurred in completing tasks associated with the PW, and costs it would incur at project closeout. The Applicant also requested resident engineering funding for activities it asserted were necessary to complete the project. 

In a letter dated May 2, 2012, the FEMA Region IV Regional Administrator (RA) denied the appeal in its entirety, making the following determinations: the activities claimed as DAC actually involved procurement and payment activities not DAC; and the replacement and/or repair of electrical components was not complex and did not require the services of a resident engineer.

Second Appeal

In a July 24, 2012 second appeal letter, the Applicant requests $17,531.00 in costs associated with resident engineering services.  The Grantee transmitted the appeal to FEMA on September 18, 2012.  The Applicant argues the documents provided with its submission reflect a direct relationship between timesheets and specific tasks on daily reports.

Discussion

Pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) § 406, FEMA is authorized to provide reimbursement for the associated expenses incurred by a local government during the repair, restoration, reconstruction, or replacement of a facility damaged as the result of a declared disaster.[1]  Generally, the costs of basic engineering and design services normally performed by an architectural-engineering firm on complex construction projects are eligible for reimbursement.[2]  Some projects require special engineering services in addition to basic engineering services.  The services of a resident engineer qualify as special engineering services and are estimated separately and apart from engineering and design service curves.  Special services are not required on all projects and these services must be shown to be necessary for completing the eligible scope of work.[3]

The RA in his response to the first appeal stated, “the replacement and/or repair of electrical components in this facility [was] not complex and [was] not a major component of the waste facilities overall.”  The RA also pointed out the PW’s costs, excluding DAC and construction management, totaled $19,253.70, while the Applicant is requesting $17,345 in resident engineering costs.

The Applicant’s second appeal submission fails to argue for or provide documents showing the necessity of resident engineering services—in fact, the submission incorrectly asserts that FEMA, in response to the first appeal, agreed the hot house required resident engineering services.  The RA concluded the exact opposite, determining the work on the hot house did not require special engineering services.  On second appeal, the Applicant did not address the RA’s conclusion.  Rather, the Applicant submitted documentation to demonstrate a relationship between the resident engineer’s time sheets and tasks completed.   The Applicant’s argument speaks only to a cost allocation documentation issue, not the threshold issue of whether resident engineering services were necessary. 

The provided documents, even though intended for another purpose, fail to reflect the necessity of resident engineering services.  These documents, by design, only address the relationship between resident engineer’s timesheets and tasks completed—they are essentially the same documents provided to the RA at first appeal, with the exception of new interlineations describing resident engineer’s services.   The new interlineations are not relevant and do not demonstrate resident engineers are necessary.

Conclusion

In conclusion, the Applicant failed to provide sufficient documentation to show resident engineers were necessary to complete work on the hot house.  Therefore, FEMA denies this appeal.