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Second Appeal Analysis
PA ID# 015-67275-00; Spring Township
PW ID# PW 123 ; Scope of Work
From May 4 through June 21, 2015, Spring Township (Applicant), located in Butler County, Kansas, experienced severe storms, flooding, straight-line winds, and tornadoes. Many of the Applicant’s gravel roads sustained damage as a result of the storms and flooding. The damages included scouring, loss of aggregate from gravel roads and ditches filled up with debris. FEMA held a kick-off meeting with the Applicant on August 31, 2015. FEMA wrote Project Worksheet (PW) 123 in December 2015, to document damages to fifteen road sites. The PW’s scope of work (SOW) authorized the replacement of gravel to a depth between one and a half inches and two and a half inches. FEMA estimated the project would cost $102,005.75. The PW was signed by the Applicant’s representative on April 25, 2016. However, prior to obligation, FEMA reviewed the project and determined it was ineligible because the Applicant failed to provide documentation to demonstrate the roads were properly maintained and the damages were the direct result of the disaster.
In a letter dated June 20, 2016, the Applicant submitted its appeal of FEMA’s denial of funding for PW 123.
The Applicant stated that it provided FEMA with all requested documentation and attached to its submission a history of gravel purchases, road crew timesheets, and rainfall data to demonstrate the road damage was disaster-related. The Applicant subsequently supplemented its appeal with various additional documentation, such as pictures, maps, and timesheets.
The appeal also included a re-written PW, which contained a revised SOW that included additional gravel for damaged roads and repair of two culverts at Site 4 and Site 11. These additional items of work were not contained in the original, FEMA-approved SOW for PW 123.
In a letter dated August 19, 2016, the Recipient forwarded the Applicant’s appeal to FEMA with a supporting analysis. The Recipient argued there was substantial evidence showing that the damaged roads were properly maintained at the time of the disaster. The Recipient also noted the same roads experienced similar damage from a 2013 disaster. As a result, these roads were repaired shortly before the 2015 disaster, with FEMA closing out the previous project a little more than one month before the 2015 disaster. The Recipient asserted the Applicant is eligible for $202,473.28 in actual costs, which included the additional repair costs and direct administrative costs (DAC).
On November 10, 2016, FEMA sent a Final Request for Information (Final RFI) to the Applicant and Recipient, stating that FEMA needed additional information to confirm that all the claimed work was eligible.
FEMA expressed concern that some of the claimed damage exceeded the original approved SOW as the Applicant increased the gravel depth at each site by an additional two to five inches and replaced two culverts. FEMA requested, among other things, information concerning the timeframe when the Applicant discovered and notified the Recipient and FEMA of the additional damages. Moreover, FEMA requested confirmation of the date the work was completed. The Final RFI advised the Applicant that the administrative record would close upon issuance of the first appeal determination.
The Applicant responded to the Final RFI by letter dated November 14, 2016, noting there were no formal records outlining when each damaged site was discovered, but asserting that all damages were reported to FEMA. According to the Applicant, they “never notified FEMA of all the problems on the project.”
Instead, the Applicant believed, “FEMA probably had quality controls in place that would have caught many of these errors.”
Regarding the SOW, the Applicant contended FEMA erred by approving one half inch increments of gravel when the average rock surface was 2 inches. The Applicant confirmed it completed all work on June 30, 2016. Lastly, the Applicant submitted rainfall data for the incident period, a breakdown of the hours worked by force account labor, and an itemized breakdown of DAC in the amount of $2,566.21.
On February 10, 2017, the Regional Administrator (RA) partially approved the appeal, granting $108,084.11 ($105,700.98 for repair costs and $2,383.13 for DAC
) in Public Assistance (PA) funding. FEMA determined that the Applicant provided documentation sufficient to show that the roads were adequately maintained prior to the disaster and the damages documented on the original PW were disaster-related. However, the RA determined the additional gravel and repair of two culverts (Site 4 and Site 11) were ineligible for reimbursement as the Applicant did not notify the Recipient or FEMA of the additional damages.
In a letter dated April 7, 2017, the Applicant appeals FEMA’s denial of $94,389.17 in funding for the additional gravel for road repairs and for the repair of two culverts. The Applicant contends the added gravel and repair of two culverts included in the re-written PW are not new and additional damages, but rather may have been omissions from the original PW. With its appeal, the Applicant enclosed damage estimates it purportedly previously provided FEMA.
The Recipient forwarded the Applicant’s second appeal submission to FEMA on May 31, 2017. The Recipient’s second appeal submission reiterates and supports the Applicant’s positions.
According to FEMA regulation, applicants have 60 days following the first substantive meeting
with FEMA to identify and report damage to FEMA.
There are instances, however, when an applicant may discover additional work that is necessary to properly complete the project.
For small projects, if an applicant discovers a gross error or omission in the SOW, an applicant should notify the recipient as soon as possible.
The applicant is responsible for requesting changes in the PW at any point when changes in the project or its costs are identified.
An applicant must obtain the prior approval of the awarding agency whenever any revision of the scope or objective of the project is anticipated.
This is critical because the PW is the basis for the PA grant.
FEMA policy cautions applicants not to assume that such costs can be reported at the end of the project and that the additional funds will be approved automatically.
Where an applicant fails to obtain FEMA’s prior approval, it risks the denial of reimbursement of costs for work that exceeds the approved SOW.
The Applicant has not demonstrated that it identified the damages on appeal within 60 days of the August 31, 2015 kick-off meeting. The administrative record does not include any documentation indicating the Applicant communicated or reported the additional damage
to FEMA prior to completion of the work. It was not until submission of the first appeal, which contained the re-written PW with the new SOW, that the Applicant informed FEMA of the additional work. Therefore, the additional work is ineligible for PA funds.
To the extent that the SOW may have contained errors or omissions, the Applicant was obligated to notify the Recipient as soon as possible. The Applicant should have been aware of the errors or omissions when it’s representative signed the PW on April 25, 2016. However, the Applicant submitted the re-written PW, to modify the approved SOW, after the work in question was completed on June 30, 2016, thus precluding FEMA from inspecting the damage and determining eligibility.
Consequently, the Applicant did not request, nor receive approval, for a change in the original SOW, as required by FEMA regulation and policy.
Therefore, the RA correctly concluded that the additional gravel and repair of the two culverts at Site 4 and Site 11 are ineligible for reimbursement.
The Applicant has not demonstrated it timely identified all disaster-related damage within the 60-day regulatory timeframe following its kick-off meeting. Nor has the Applicant shown where it requested, and received approval, for a change in the SOW. The Applicant’s appeal is therefore denied.
Letter from Infrastructure Branch Dir., FEMA Region VII to Deputy Dir., Kan. Div. of Emergency Mgmt. and Operator, Spring Twp., at 2-3 (May 18, 2016).
Letter from Tr., Spring Twp., to Kan. Div. of Emergency Mgmt., at 1 (June 20, 2016).
Letter from Deputy Dir., Kan. Div. of Emergency Mgmt., to Reg’l Adm’r, FEMA Region VII, at enclosure 3 (Aug. 19, 2016).
Letter from Dir., Recovery Div. FEMA Region VII to Deputy Dr., Kan. Div. of Emergency Mgmt. and Tr., Spring Twp., at 1 (Nov. 10, 2016) [hereinafter Final RFI
Letter from Operator, Spring Twp., to Kan. Emergency Mgmt. and FEMA Region VII, at 1 (Nov. 14, 2016).
The Applicant’s appeal sought $2,458.47 in DAC. In response to the Final RFI, the Applicant provided an updated spreadsheet with $2,566.21 as the amount requested for DAC. According to FEMA’s calculations, the proper amount for DAC was $2,383.13. This is the amount awarded to the Applicant in FEMA’s first appeal determination, which the Applicant did not challenge on second appeal.
This additional information was not considered by FEMA when adjudicating this appeal. See
FEMA Second Appeal Analysis, Nobles Cooperative Electric,
FEMA-4112-DR-MN, at 2-3 (July 23, 2015) (explaining that once the administrative record is closed, FEMA will not consider any new information submitted with a second appeal.). See also, Final RFI
, supra note 3 (advising the Applicant the administrative record would close upon issuance of the first appeal determination.).
 Public Assistance Guide
, FEMA 322, at 96 (June 2007) [hereinafter PA Guide
] (explaining the first substantive meeting is usually the Kickoff Meeting).
Title 44 Code of Federal Regulations (44 C.F.R.) § 206.202(d)(1)(ii) (2014).
44 C.F.R. § 13.30(d)(l).
FEMA Second Appeal Analysis, Roseau Cty. Hwy. Dept.
, FEMA-1288-DR-MN, at 7 (Jan. 6, 2017).
The Applicant argues that the extra gravel and repair of two culverts was not additional damage. FEMA considers them to be additional damage to the extent they were not listed in the originally approved SOW for PW 123.
 PA Guide
, at 140 (explaining the timing of a request to change the SOW should be such that the damaged element can be inspected by FEMA prior to its repair).
44 C.F.R. § 13.30(d)(l); PA Guide
, at 139-140.