Between September 23 and November 1, 2005, Hurricane Rita devastated the state of Louisiana, including Cameron Parish, where the Cameron Parish School Board (Applicant) is located. The storm destroyed the Applicant’s Administration Office Building (Facility), and FEMA prepared Project Worksheet (PW) 533 to address reconstruction of the Facility. After several revisions, FEMA obligated PW 533 V12 and issued the Change Order Summary Spreadsheet outlining the eligible and ineligible costs. The Applicant appealed $79,180.56 associated with the overhead and profit (OH&P) as well as bond and insurance (B&I) costs associated with the construction change orders. The Applicant also appealed $15,064.50 in costs for the Facility’s security system. In its first appeal the Applicant argued that FEMA improperly calculated OH&P and B&I for the change orders and that FEMA wrongly denied reimbursement of costs for a security system. The Regional Administrator (RA) found that the Applicant had not shown that the new security system existed in the predisaster Facility nor that it was required by a code or standard. Additionally, the RA found that FEMA properly applied RS Means estimates to determine reasonable costs to calculate both OH&P and B&I and therefore, denied the Applicant’s appeal. On second appeal, the Applicant asserts the same arguments but adds that FEMA should not have provided lump sum estimations for RS Means, instead arguing that line-by-line estimates were more appropriate. Next, the Applicant contends that the actual costs submitted were close enough to the RS Means estimates and should be presumptively reasonable.
Authorities and Second Appeals
- 44 C.F.R. §§ 13.36, 13.43, 206.206, 206.226 (2004).
- 2 C.F.R. § 225.55 (2005).
- UTMB¸ FEMA-1791-DR-TX, at 5-6 (Mar. 29, 2017).
- Dep’t of Transp., FEMA-4068-DR-FL, at 5 (Aug 5, 2016).
- Spanish Flat Water District, FEMA-1646-DR-CA, at 3 (May 22, 2012).
- Federal Aviation Administration – Request for Advance Decision, B-195173, 58 Comp. Gen. 654 (1979).
- City of Fort Lauderdale, FEMA-1609-DR-FL, at 5-6 (Nov. 25, 2015).
- Twin Valley Electric Cooperative, FEMA-1741-DR-KS, at 6-7 (June 28, 2017).
- 44 C.F.R. § 206.226 limits eligible work to restoration of facilities to the predisaster condition.
- The Applicant failed to prove that FEMA funding was insufficient to replace the security system as it existed in the predisaster Facility.
- 44 C.F.R. § 206.206 holds an applicant must provide documented justification for its position.
- The Applicant provided no support that FEMA improperly calculated OH&P or B&P costs.
- 44 C.F.R. § 13.36 prohibits cost plus a percentage of cost contracting.
- The Applicant’s construction contract article governing change orders may be a cost plus percentage contract and therefore prohibited.
The Cameron Parish School Board failed to demonstrate that FEMA funding was insufficient to replace the security system, as it existed in the predisaster Facility. Moreover, the Applicant also failed to demonstrate that FEMA miscalculated the direct, B&I, or OH&P costs. All appealed costs are ineligible and the appeal is denied.