From October 1-23, 2015, South Carolina experienced prolonged heavy rainfall and flooding, resulting in damage to the Applicant’s sewer system, including its manholes. The Applicant observed increased wastewater flows in two basins and identified disaster related damage in some manholes and sewer lines along those basins. Based on this analysis and set of observations, the Applicant contracted with Michael Baker International (MBI), an engineering firm, to perform damage assessments on approximately 290 manholes in along two basins to determine the extent of flood-related damages. MBI found that 75 manholes were damaged by the disaster and it recommended repairs for each of them. The Applicant requested Public Assistance (PA) for repairs to the manholes and also requested $135,196.09 for MBI’s damage assessments identifying the 75 disaster-damaged manholes and recommending repairs. On August 15, 2018, FEMA issued a determination memorandum denying $135,196.09 in PW 1125 for damage assessments, finding they were general damage surveys which are ineligible for funding under PA policy. Shortly thereafter, FEMA obligated Version 0 of PW 1125 for a total of $938,350.58, approving costs for repairs and Direct Administrative Costs but not for damage assessments. The Applicant appealed claiming that the costs were eligible under PA policy guidance allowing reimbursement for inspections to determine the extent of damage and nature of repairs, when damage to an inaccessible structure is evident. Alternatively, the Applicant claimed that the costs may be eligible as engineering and design costs. The Applicant also clarified in a response to a Request for Information that it was only requesting reimbursement for costs associated with the 75 damaged manholes identified, rather than all 290 manholes inspected. On July 15, 2019, FEMA Region IV’s Regional Administrator (RA) denied the appeal, finding that the work appealed constituted ineligible damage surveys and that the limited repairs documented in the PW’s scope of work (SOW) did not appear to justify reimbursement for damage assessments. The Applicant submitted a second appeal reiterating prior arguments.
Authorities and Second Appeals
- According to the PA Guide, the owner of a facility is responsible for determining the extent of damage. Surveys for damage are not eligible for PA funding. However, when damage to an inaccessible structure or structural component is evident based on other observations, FEMA may pay for inspections to determine the extent of damage and method of repair.
- The Applicant’s contractor inspected 290 manholes for damage and did not limit its assessment to determining the extent of damage or method of repairs for inaccessible structures where damage was evident. This assessment constitutes an ineligible damage survey.
- The PA Guide states that costs for an engineering evaluation to determine the type and extent of repairs necessary to return a facility to its predisaster condition and costs of basic engineering and design services normally performed by an architectural-engineering firm on complex constructions projects are eligible for reimbursement. All costs must be reasonable and necessary to perform the eligible work.
- The Applicant has not demonstrated that the appealed costs were required as part of an engineering evaluation to determine the type and extent of necessary repairs. This type of engineering evaluation would not have been reasonable or necessary for the complexity of repairs described in this PW’s SOW – cleaning and spraying damaged manholes without significant variation between repairs.
The costs associated with locating and assessing damaged manholes are ineligible as part of a general survey for damage and cannot be justified as eligible engineering and design costs based on the complexity of repairs in the PW’s approved SOW. Accordingly, the Applicant’s appeal is denied.