On May 22, 2011, an E-5 tornado struck the City of Joplin, Missouri (Applicant), and as a result, some of the Applicant’s fire vehicles suffered significant damage, with five of the vehicles a total loss. In addition, three other fire vehicles and other pieces of fire equipment incurred repairable damage. FEMA wrote Project Worksheet (PW) 1939 for the permanent repair and replacement of fire vehicles and related equipment, for a total estimated award of $439,785.00. On September 26, 2016, the Grantee submitted a Large Project Final Accounting, in which the Applicant requested payment of $919,633.78. FEMA issued a Determination Memorandum (DM) on February 23, 2018, denying the requested funding amount. FEMA noted that per agency policy, eligible replacement costs for vehicles are based on used items of similar age, capacity, and condition. The Applicant, however, purchased new vehicles without demonstrating that similar used items were either not available within a reasonable time or distance, or not in accordance with national consensus standards. In addition, FEMA noted that the Applicant purchased additional fire equipment not included in PW 1939. Thus, FEMA determined that the PW amounted to an improved project and capped the award at the obligated amount less actual insurance proceeds, for a total of $212,829.62. The Applicant appealed, arguing that its fire department purchases only new fire and police vehicles based on public safety concerns, and that it conducted a search for comparable used vehicles but found none because its department required specific, custom upgrades to the vehicles. FEMA denied the first appeal for the same reasons as in the DM, but also found that the Applicant failed to demonstrate that any custom upgrades or new trucks were required by codes and standards. FEMA also determined the temporary used fire trucks, which FEMA funded separately under PW 1950, constituted the permanent replacement trucks for PW 1939 and in addition to denying the request for additional funding in PW 1939, FEMA also deobligated all funding in PW 1950. The Applicant submitted a timely second appeal to the Grantee on December 7, 2018.
Authorities and Second Appeals
- Stafford Act § 406.
- 44 C.F.R. §§ 13.32(e)(2), 206.201(c), 206.203(c), 206.226(d), 206.226(h).
- PA Guide, at 49, 83, 84, 110.
- RP 9524.10, at 2.
- DAP 9525.12, at 2.
- Per RP 9524.10, FEMA will fund costs of new items if comparable used items are not available within a reasonable time or distance, or do not meet applicable national consensus standards.
- The Applicant did not demonstrate that used comparable fire vehicles were not available or not in line with national consensus standards.
- Per DAP 9525.12, applicants may retain replacement equipment even if no longer needed after the project is complete, provided the applicant reimburses FEMA its share of the fair market value of the equipment prior to disaster closeout.
- The Applicant may retain the temporary fire vehicles in PW 1950, provided it reimburses FEMA prior to disaster closeout.
Conclusion- (Appeal decision issued 5/30/2019)
The Applicant has not demonstrated that used comparable vehicles were not reasonably available or did not meet national consensus standards, thus, FEMA denies the request for additional funding for new fire vehicles. However, FEMA is reinstating funding in PW 1950, as FEMA policy permits the Applicant to retain the temporary fire trucks, provided the Applicant reimburses FEMA the fair market value.