Appeal Timeliness
Appeal Brief
Appeal Letter
Appeal Analysis
Appeal Brief
| Disaster | FEMA 1561 |
| Applicant | Town of Windermere |
| Appeal Type | Second |
| PA ID# | 095-78050-00 |
| PW ID# | PW) 4116 |
| Date Signed | 2018-04-02T00:00:00 |
Conclusion: The Florida Division of Emergency Management (Grantee) failed to forward the Town of Windermere’s (Applicant’s) first appeal within 60 days of receipt. Thus, the first appeal was untimely. FEMA’s policy implementing Stafford Act Section 705(c) protections does not apply to matters where appeal rights have lapsed and are exhausted.
Summary Paragraph
In September 2004, high winds from Hurricane Jeanne caused extensive damage throughout the Town of Windermere (Applicant), Florida. FEMA prepared Project Worksheet (PW) 4116 to document the Applicant’s contract costs associated with the removal and disposal of hazardous tree limbs from public property. Upon subsequent review at closeout, FEMA determined that the Applicant did not competitively bid the contract and failed to provide support documentation for some of the work, and deobligated funding. In 2015, the Florida Division of Emergency Management (Grantee) notified the Applicant of the deobligation, enclosing the project application grant report (P.2 report), and advised the Applicant to submit an appeal with supporting documentation through the Grantee’s online grants management system. On February 15, 2016, the Applicant entered its justification for a first appeal and filed supporting documentation through the Grantee’s online grants management system (FloridaPA.org). It subsequently uploaded additional documentation and resubmitted the appeal in a letter on March 15, 2016. In its appeal, the Applicant objected to the deobligation occurring so many years later, arguing the contract was properly bid, and further that Stafford Act Sections 705(a) and (c) prohibited taking the funding back. The Grantee forwarded the Applicant’s appeal to FEMA on May 18, 2016. In a Final Request for Information, FEMA requested proof the appeal was filed and forwarded within the 60-day regulatory time limit. The Applicant provided records supporting notice was received on December 17, 2015, and asserted it timely-filed the appeal’s content with documentation with the Grantee, through FloridaPA.org. The Regional Administrator (RA) denied the appeal because it was untimely. She referenced FEMA’s implementing policy, which explains that 705(c) does not apply where appeal rights are exhausted and FEMA has rendered a final administrative decision. On second appeal the Applicant argues: its first appeal rights are preserved since FEMA failed to provide the requisite analysis demonstrating the 705(c) criteria were not met; FEMA’s policy 705(c) policy was issued after the first appeal was initiated and should not apply; it should not be penalized for the Grantee’s delayed transmittal; and its February submittal met appeal content criteria, regardless of when the formal letter was filed.
Authorities and Second Appeals
- Stafford Act §§ 423(a), 705(c).
- 44 C.F.R. §§ 206.206(a) and (c)(1)-(2).
- Recovery Policy FP 205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures.
- Goshen Historic District, FEMA-4085-DR-NY, at 2, Dep’t of Transp., FEMA-4068-DR-FL, at 3, Roman Catholic Archdiocese of Miami, FEMA-1602-DR-FL, at 3-4, City of Pensacola, FEMA-1551-DR-FL, at 5, Port of Galveston, FEMA-1791-DR-TX, at 7.
Headnotes
- Section 423 of the Stafford Act, implemented by 44 C.F.R. § 206.206(c), requires an applicant to appeal a determination within 60 days of receiving notice. The grantee must forward the appeal together with a written recommendation, within 60 days of receipt. Failure by either the applicant or the grantee to comply with these requirements renders the appeal untimely and the applicant’s appeal rights lapse.
- 44 C.F.R. § 206.206(a) provides that appeals will be made in writing through the grantee and must contain documented justification supporting the appellant’s position, specifying the monetary figure in dispute and the provisions in Federal law, regulation, or policy with which the appellant believes the initial action was inconsistent.
- The Applicant demonstrated its February 15, 2016 submittal met appeal content and format requirements and was timely filed. However, the Grantee failed to forward it to FEMA within 60 days of receipt.
- Recovery Policy FP 205-081-2, implementing Stafford Act Section 705(c), does not apply where appeal rights are exhausted and FEMA has made a final administrative decision.
- Because the first appeal was untimely, the Applicant’s appeal rights lapsed. Therefore, FEMA’s guidance implementing Stafford Act Section 705(c) is inapplicable.
Appeal Letter
Mr. Wesley Maul
Director
Florida Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, FL 32399-2100
Re: Second Appeal – Town of Windermere, PA ID 095-78050-00, FEMA‑1561-DR-FL, Project Worksheet (PW) 4116 – Appeal Timeliness, 705(c)
Dear Mr. Maul:
This is in response to your office’s letter, as amended on January 2, 2018, which transmitted the referenced second appeal on behalf of the Town of Windermere (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) decision to uphold the deobligation of $160,057.81 in Public Assistance funding based on an untimely first appeal submission.
As explained in the enclosed analysis, I have determined that the Applicant’s first appeal was untimely and as such, the Applicant’s appeal rights lapsed. Consequently, the protections of Stafford Act Section 705(c) do not apply. Accordingly, I am denying the appeal.
Please inform the Applicant of my decision. This determination is the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.
Sincerely,
/S/
Keith Turi
Acting Assistant Administrator
Recovery Directorate
Enclosure
cc: Gracia B. Szczech
Regional Administrator
FEMA Region IV
Appeal Analysis
Background
On September 24, 2004, high winds from Hurricane Jeanne caused extensive damage throughout the Town of Windermere (Applicant) in Florida. FEMA prepared Project Worksheet (PW) 4116 to document the Applicant’s contract costs associated with the removal and disposal of hazardous tree limbs from public property. Upon subsequent review at closeout, FEMA determined that the Applicant did not competitively bid the contract and failed to provide support documentation for some of the work.[1] For these reasons, in 2014, FEMA deobligated funding from the PW.[2] The Florida Division of Emergency Management (Grantee) notified the Applicant of the deobligation in a letter dated July 2, 2015, which enclosed a copy of FEMA’s project application summary (P.2 report). The Grantee’s letter also advised the Applicant that it had 60 days upon receipt to submit an appeal with supporting documentation through the Grantee’s online grants management system (FloridaPA.org).[3]
First Appeal
The Applicant submitted a first appeal for $160,057.81[4] in a letter dated March 15, 2016. The Applicant stated the funding was deobligated in error, arguing it competitively bid the contract and its bidding process complied with federal regulation. Additionally, the Applicant argued that FEMA is prohibited by the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) Section 705(a)[5] from recovering funding because more than three years had passed since funds were approved and paid. If making an argument on Section 705(a) grounds was found to be premature, the Applicant asserted that Stafford Act Section 705(c) also bars recovery[6] because the required three criteria were met.[7] The Grantee forwarded the appeal on May 18, 2016 together with its letter of concurrence dated the previous day.
In a Final Request for Information (Final RFI) issued on July 18, 2017, FEMA Region IV requested documentation demonstrating the Applicant’s timely submittal of the appeal to the Grantee and the Grantee’s timely forwarding of it to FEMA. The Final RFI indicated timeliness of the appeal was based on the record of when notification of the deobligation occurred (July 2, 2015), the Applicant’s appeal letter date (March 15, 2016), and the date the Grantee transmitted the appeal to FEMA (May 18, 2016).[8] In response,[9] the Applicant offered additional documentation for FEMA’s consideration, such as screenshots from FloridaPA.org and e-mail correspondence to substantiate it did not receive notification (with the P.2 report) until December 17, 2015. Furthermore, it cited to correspondence wherein this date was acknowledged by the Grantee as the start of the 60-day period to submit its appeal through FloridaPA.org.[10] Lastly, the Applicant clarified that the appeal’s content was timely filed with the Grantee in FloridaPA.org on February 15, 2016 (including supporting documentation).[11] At the Grantee’s request, the Applicant later submitted the appeal in the form of a letter on March 15, 2016.[12] In a separate response letter, the Grantee stated it did not have additional documentation supporting that it timely forwarded the appeal to FEMA. The Grantee also argued, because Stafford Act Section 705(c) serves as a statutory barrier to FEMA’s authority to deobligate funds, an appeal asserting the applicability of the subsection is unnecessary. Rather, prior to proceeding with deobligation, FEMA has the burden of demonstrating that the subsection’s requirements have not been met.[13]
On October 18, 2017, the FEMA Region IV Regional Administrator (RA) denied the appeal. The RA referenced screenshots from FloridaPA.org documenting earlier attempts to provide notification of the deobligation dating back to May 2014. Even if the Applicant was not notified until December 2015 and FEMA were to accept that the appeal was in fact filed a month prior to the letter date, the RA emphasized it was nonetheless untimely because the Grantee missed the deadline when forwarding it to FEMA. She further determined that pursuant to FEMA’s Recovery Policy FP 205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures, Stafford Act Section 705(c) does not apply where appeal rights are exhausted and FEMA has rendered a final administrative decision.[14]
Second Appeal
On December 18, 2017, the Applicant submitted a second appeal. The Applicant reasserts its previous arguments and contends its first appeal right is preserved because FEMA has not provided analysis demonstrating that the criteria of Stafford Act Section 705(c) were not met. Moreover, the Applicant argues that because FEMA did not issue FP 205-081-2 until late March 2016, after the first appeal process had begun, it is inapplicable. Even if the policy applied, the Applicant asserts it should not be penalized for the Grantee’s untimely transmittal. In addition, the Applicant contends the appeal, timely-filed in February 2016, met appeal content criteria pursuant to Title 44 of the Code of Federal Regulations (44 C.F.R.) § 206.206(a). Thus, in this instance, the Applicant indicates it should not matter that the formal letter, comprised of the same content, was not filed until March since neither the Stafford Act nor regulation require submitting an appeal “in a particular form.”[15]
The Grantee forwarded the second appeal on January 2, 2018, recommending approval. According to the Grantee, although it attempted to make notice of the deobligation by posting its July 2015 letter to FloridaPA.org, it asserts there is no proof the Applicant received such notification prior to December 17, 2015. It reiterates the Applicant timely-filed the first appeal but concedes it failed to forward it to FEMA within 60 days.
Discussion
Appeal Requirements
Section 423 of the Stafford Act, as implemented by 44 C.F.R. § 206.206, allows an eligible applicant to appeal any Public Assistance eligibility determination within 60 days after receiving notice of the award or denial of award of such assistance.[16] Implementing regulations require an applicant to submit an appeal to the grantee within 60 days of receiving notice of the appealable action.[17] The date an applicant receives notice of FEMA’s eligibility determination serves as the date from which the applicant’s 60-day time period to file a first appeal runs.[18] Following receipt of an applicant’s appeal, a grantee has 60 days to forward it together with a written recommendation, to the Regional Administrator.[19] Failure by either an applicant or the grantee to comply with these requirements renders the appeal untimely and the applicant’s appeal rights lapse.[20] Appeals must also be made in writing and must contain documented justification supporting the appellant’s position, specifying the amount in dispute, and provisions in federal law, regulation, or policy with which the appellant believes the initial action was inconsistent.[21]
Even though there is information showing the Grantee made earlier attempts to notify the Applicant, the Applicant provided records demonstrating it did not receive notice, along with FEMA’s P.2 report, until December 17, 2015.[22] Moreover, in subsequent correspondence, the Grantee indicated that because notification “did not reach” the Applicant, it sent a “new P.2 [report]” on December 17, 2015.[23] The Applicant has also demonstrated it filed the first appeal, in writing with the Grantee, on February 15, 2016.[24] The appeal justification and supporting documentation that was uploaded on February 15, 2016 sufficiently explained the Applicant’s position, disputed amount, and why the Applicant believed the deobligation was inconsistent with federal law and regulation.[25] It later supplemented this filing with more documentation (uploaded March 7-15, 2016)[26] and additional narrative in the March 15, 2016 appeal letter. Thus, based on when the Applicant received notice of the appealable action and when the first appeal was filed with the Grantee, the Applicant submitted a timely appeal that met format and content requirements.[27] However, regardless of whether the Grantee received the appeal in February or March 2016, it was not forwarded until May 18, 2016,[28] after the Grantee’s regulatory 60-day period had expired. This fact is not in dispute.[29] Therefore, the first appeal was rendered untimely by the Grantee’s actions.[30]
Stafford Act Section 705(c)
Stafford Act Section 705(c) provides that a state or local government is not liable for reimbursement or any other penalty for any payment made pursuant to the Stafford Act if the payment was authorized by an approved agreement specifying costs, the costs were reasonable, and the purpose of the grant was accomplished.[31] FEMA implemented this statutory provision through its Recovery Policy FP 205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures.[32] If the three criteria are met, FEMA is prohibited from recovering grant funds even if it later determines that it made an error in determining eligibility.[33] This policy also explains that the statutory prohibition does not apply to matters where appeal rights have lapsed and FEMA has made a final administrative decision.[34]
The Applicant and Grantee argue that, since the appeal was initiated before FEMA issued the policy, the policy should not apply. In terms of scope, however, the policy applies to all potential recoveries but not when an applicant’s appeal, arbitration or dispute resolution rights have lapsed and FEMA has made a final administrative decision (e.g., an adjudicated second appeal or final arbitration decision).[35] As discussed above, because the Grantee forwarded the first appeal after the expiration of the regulatory timeframe, the Applicant’s appeal rights lapsed. As such, FEMA FP 205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures, implementing Stafford Act 705(c) protections, is inapplicable.[36]
Conclusion
The Grantee failed to forward the first appeal to FEMA within the 60 days required by regulation. Thus, the first appeal was untimely. FEMA’s guidance implementing Stafford Act Section 705(c) protections, does not apply after an applicant’s appeal rights have lapsed. Consequently, the appeal is denied and FEMA may recover funding.
[1] Project Worksheet 4116, Town of Windermere, Version 2 (Apr., 14, 2014) (incorporating by reference FEMA’s previous explanation for this determination conveyed by general comment dated Feb. 10, 2014).
[2] Id. (deobligating $165,008.05).
[3] Letter from State Pub. Assistance Officer, Fla. Div. of Emergency Mgmt., to Fin. Dir., Town of Windermere, at 1 (July 2, 2015). The letter’s date displays an error (“July 2, 105”).
[4] Letter from Applicant’s Attorney, to Appeals Officer, Fla. Div. of Emergency Mgmt., at 1 (Mar. 15, 2016) [hereinafter, Applicant’s First Appeal Letter]. The appealed amount appears to represent how the Grantee determined the amount “overpaid” to the Applicant as a result of FEMA’s deobligation, with corresponding reductions in Applicant and Grantee administrative costs.
[5] The Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1988, Pub. L. No. 93-288, § 705(a), 42 U.S.C. § 5205(a) (2003).
[6] Applicant’s First Appeal Letter at 3. The Applicant cited 42 U.S.C. §§ 5205(a) and (c), which refer to Stafford Act Sections 705(a) and (c), respectively.
[7] Stafford Act § 705(c) provides that a state or local government shall not be liable for reimbursement or any other penalty for payment made under the Act if (1) the payment was authorized by an approved agreement specifying costs; (2) the costs were reasonable; and (3) the purpose of the grant was accomplished.
[8] Letter from Dir., Recovery Div., FEMA Region IV, to Dir., Fla. Div. of Emergency Mgmt. & Attorneys [Applicant’s counsel of record], at 1 (July 18, 2017). Additional information pertaining to the substance of the appeal was not requested.
[9] Letter from Attorneys, to Dir., Recovery Div., FEMA Region IV, at 1-2 (Aug. 17, 2017) [hereinafter, Applicant’s Final RFI Response] (enclosing support documentation collectively referenced as Exhibit A) [hereinafter, Exhibit A].
[10] Applicant’s Final RFI Response, at 1; Exhibit A, at 61.
[11] Applicant’s Final RFI Response, at 2; Exhibit A, at 64-70.
[12] Applicant’s Final RFI Response, at 2.
[13] Letter from Dir., Fla. Div. of Emergency Mgmt., to Dir., Recovery Div., FEMA Region IV, at 2 (Aug. 28, 2017).
[14] FEMA Recovery Policy FP 205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures, at 2 (Mar. 31, 2016) [hereinafter, FP 205-081-2].
[15] Letter from Attorney, to Assistant Adm’r, Recovery, FEMA, through Adm’r, FEMA Region IV, at 3 (Dec. 18, 2017).
[16] Stafford Act § 423(a).
[17] 44 C.F.R. § 206.206(c)(1) (2004).
[18] Recovery Directorate Manual, Public Assistance Program Appeal Procedures, Version 3, at 12 (Apr. 7, 2014).
[19] 44 C.F.R. § 206.206(c)(2).
[20] FEMA Second Appeal Analysis, Goshen Historic Track Inc., FEMA-4085-DR-NY, at 2 (Jan. 23, 2018); FEMA Second Appeal Analysis, Dep’t of Transp., FEMA-4068-DR-FL, at 3-4 (Aug. 5, 2016).
[21] 44 C.F.R. § 206.206(a).
[22] Applicant’s Final RFI Response, Exhibit A, at 11-16 (documenting the Grantee emailed the July 2015 notification letter with the P.2 report to the Applicant on Dec. 17, 2015); at 62 (documenting, in email sent to the Grantee on Dec. 16, 2015, that the Applicant had not received the P.2 report (as of Dec. 16th), and that the Applicant’s mailing address was inaccurate in FloridaPA.org.).
[23] Applicant’s Final RFI Response, Exhibit A, at 61.
[24] Id. at 69 (providing a snapshot from FloridaPA.org as proof that the Applicant first submitted the appeal for Grantee review on Feb. 15, 2016).
[25] Id. at 64-66 (providing an excerpt of the appeal’s justification entered in FloridaPA.org). FEMA examined the full text of the entry in FloridaPA.org during review of the second appeal.
[26] Id. at 70.
[27] Had FEMA relied exclusively on the March 15, 2016 letter date, the first appeal would be untimely pursuant to 44 C.F.R. § 206.206(c)(1).
[28] E-mail from Fla. Div. of Emergency Mgmt. Agency, to, FEMA Region IV, FEMA-R4-PA-Appeals [shared distribution list] (May 18, 2016 10:00 CST) (forwarding the first appeal).
[29] Letter from Interim Dir., Fla. Div. of Emergency Mgmt., to Assistant Adm’r, FEMA Recovery, through Adm’r, Recovery, FEMA Region IV, at 3 (Jan. 2, 2018) (“…the Recipient failed to forward the Subrecipient’s appeal to FEMA Region IV in a timely manner.”). Note that Jan. 2, 2018 is when the Grantee transmitted its amended second appeal recommendation letter to FEMA.
[30] See, e.g., FEMA Second Appeal Analysis, City of Pensacola, FEMA-1551-DR-FL, at 5 (Mar. 22, 2017) (finding that “… both prongs of [44 C.F.R. §] 206.206(c) must be met in order for an appeal to be timely.”).
[31] Stafford Act § 705(c).
[32] FP 205-081-2, at 4-7 (Mar. 31, 2016).
[33] Id. at 4.
[34] FP 205-081-2, at 4; FEMA Second Appeal Analysis, Port of Galveston, FEMA-1791-DR-TX, at 7 (Jan. 19, 2017).
[35] FP 205-081-2, at 2.
[36] FEMA Second Appeal Analysis, Roman Catholic Archdiocese of Miami, FEMA-1602-DR-FL, at 3-4 (Jan. 3, 2018).
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