Appeals, Immediate Threat, Force Account Labor and Equipment Costs

Appeal Brief Appeal Letter Appeal Analysis

Appeal Brief

Disaster	4485
Applicant	Austin Independent School District
Appeal Type	Second
PA ID#	453-08A64-00
PW ID#	GMP 169609/PW 337
Date Signed	2023-03-21T16:00:00

Summary Paragraph

As a result of the COVID-19 pandemic, the Austin Independent School District (Applicant) requested funding under the Federal Emergency Management Agency’s (FEMA) Public Assistance (PA) program for force account labor (FAL) costs. On April 4, 2022, FEMA issued a Determination Memorandum, received by the Applicant that same day, denying the request because the costs did not meet FEMA eligibility criteria for PA funding. On June 3, 2022, the Applicant uploaded its first appeal in the Texas Division of Emergency Management (TDEM) (Recipient) Grants Manager System (GMS). In a June 15, 2022 letter to the Recipient, the Applicant restated its appeal position and attached a copy of its cleaning processes. On July 6, 2022, the Recipient transmitted the Applicant’s June 15, 2022 appeal letter to FEMA. On July 21, 2022, the FEMA Regional Administrator (RA), Region VI, denied the appeal as untimely and therefore did not address the eligibility of the FAL costs claimed.  On August 22, 2022, the Applicant submitted its second appeal, reiterating its first appeal arguments and contending it timely submitted its first appeal . In support, the Applicant includes a TDEM GMS screenshot and emails showing it uploaded its revised first appeal on June 3, 2022. On August 29, 2022, the Recipient transmitted the second appeal with its supporting letter confirming the Applicant’s original  first appeal submission date. FEMA sent a request for information seeking documentation demonstrating that the Applicant submitted its first appeal to FEMA in compliance with the time, form and content requirements of 44 C.F.R. § 206.206 and that the claimed FAL tasks (cleaning and disinfecting) were for COVID-19 emergency protective measures. In its response, the Applicant provided additional TDEM GMS documentation supporting the timeliness of the first appeal submittal and emails pertaining to disinfecting.

Authorities and Second Appeals

• Stafford Act §§ 403(a)(3), 423(a), 502.
• 44 C.F.R. §§ 206.206(a) and (c), 206.225(a)(3)(i), 206.228(a)(2)(iii).
• PAPPG, at 1924, 42, 57, 133.
• FP 104-21-003.

Headnotes     

• An applicant must file an appeal through the recipient to the regional administrator within 60 days after receipt of notice of the action that is to be appealed.
  • The Applicant demonstrated that it timely filed its first appeal.
• To be eligible for reimbursement, costs must be directly tied to the performance of eligible work and be adequately documented.  It is the applicant’s responsibility to substantiate its claim as eligible.
  • The Applicant has not substantiated through documentation that the claimed costs are tied to the performance of eligible work.

Conclusion

The Applicant has demonstrated that its first appeal was filed timely. However, the Applicant has not substantiated through documentation that the FAL costs claimed are tied to the performance of eligible work. Therefore, this appeal is denied.

Appeal Letter

Appeal Analysis

Background

On March 25, 2020, the coronavirus (COVID-19) pandemic resulted in a major disaster declaration for the State of Texas, during the incident period of January 20, 2020, and continuing. The Austin Independent School District (Applicant) requested funding under the Federal Emergency Management Agency’s (FEMA) Public Assistance (PA) program for $261,418.65 in straight-time force account labor (FAL) for deep cleaning and disinfecting provided from January 20 through March 13, 2020. The Applicant’s pay policy provided that: a) budgeted employees required to report to work during closure to conduct cleaning and disinfecting were paid at the rate of one- and one-half times their regular rate of pay for all hours worked up to 40 hours per week, and b) overtime for time worked over 40 hours in a week was calculated and paid according to law. In support of its claimed costs, the Applicant provided correspondence confirming that all the employees who performed emergency work were either permanent or seasonal budgeted employees and were not working in excess of their regularly scheduled 40-hour work week. On April 4, 2022, FEMA issued a Determination Memorandum (DM), received by the Applicant the same day, denying the requested costs because the Applicant’s submitted costs for regular straight-time reimbursement were not sufficiently documented and did not meet FEMA eligibility criteria for PA funding.

First Appeal

On April 13, 2022, the Applicant emailed a draft of its first appeal to the Texas Division of Emergency Management’s (TDEM) (Recipient) and requested advice on any needed revisions. On June 3, 2022, the Applicant uploaded its appeal using the TDEM Grants Manager System (GMS). On June 9, 2022, following a meeting to discuss the June 3, 2022 submission, the Recipient sent the Applicant a followup email with its suggested revisions. In a June 15, 2022 letter to the Recipient, the Applicant attached additional documentation and stated it reduced the appealed claim amount to actual overtime (OT) worked, a total of 6,202.25 hours for $149,614.91. The Applicant contended that its claim was denied in error due to FEMA’s belief and misunderstanding that the work was performed during, not after, regular hours. On June 24, 2022, the Recipient transmitted the Applicant’s June 15, 2022 appeal letter with supporting documentation, and a Recipient-letter recommending approval, to FEMA. On July 21, 2022, the FEMA Region VI Regional Administrator denied the appeal as untimely based on the June 15, 2022 date on the appeal letter transmitted to FEMA, which was more than 60 days after the Applicant’s receipt of the DM.

Second Appeal

On August 22, 2022, the Applicant submitted its appeal reiterating its first appeal arguments. The Applicant also contends its first appeal was timely submitted and includes a TDEM GMS screenshot and emails showing it uploaded its first appeal on June 3, 2022. The Applicant explains that on June 3, 2022, the Recipient asked additional questions which resulted in submission of the June 15, 2022 letter, transmitting additional documentation.

On August 29, 2022, the Recipient transmitted the Applicant’s second appeal, with a recommendation for reconsideration. The Recipient’s transmittal also enclosed supporting documentation, including: (1) a GMS screenshot showing the Applicant’s June 3, 2022 document uploads; (2) TDEM GMS activity notification emails; (3) various emails dated April 4-June 3, 2022, from the Recipient to the Applicant, providing guidance on what to include in the appeal, how to upload the appeal to TDEM GMS, and confirming receipt of the Applicant’s first appeal submission; (4) the Applicant’s compensation pay plan; and (5) a Payment Detail Listing showing OT hours worked for each Applicant-employee. In its transmittal letter, the Recipient confirms that the Applicant submitted its appeal through the TDEM GMS on June 3, 2022 and that the Recipient recommended minor changes. The Applicant then submitted an updated appeal letter dated June 15, 2022.

On November 4, 2022, FEMA sent a Request for Information (RFI) seeking documentation demonstrating that the Applicant submitted its first appeal to FEMA within the regulatory time limits and that the claimed force account labor OT tasks (cleaning and disinfecting) are for COVID-19 emergency protective measures. The Applicant responded to the RFI by providing: (1) duplicate copies of previously provided documentation in addition to another document from the TDEM GMS; (2) the attachments for the previously provided April and June 2022 emails;[1] and (3) two emails addressing the percentage of the Applicant’s increased disinfection efforts in response to the COVID-19 pandemic.

 

Discussion

Appeals

The Robert T. Stafford Disaster Relief and Emergency Assistance Act provides that an applicant may appeal any decision regarding eligibility for, from, or amount of assistance under this title within 60 days after the date on which an applicant is notified of the award or denial of award of such assistance.[2] FEMA’s implementing regulations require that applicants file an appeal through the recipient to the RA within 60 days after receipt of notice of the action that is to be appealed.[3]

Here, the Applicant received the DM on April 4, 2022 and by April 13, 2022, had emailed a draft appeal letter to the Recipient that met form and content requirements under Title 44 of the Code of Federal Regulations § 206.206(a), as the appeal specified the monetary figure in dispute and the provisions in Federal law, regulation, or policy, with which the Applicant believed the initial action was inconsistent. However, the Recipient suggested some revisions to the appeal (e.g., putting the appeal letter on the Applicant’s letterhead) and additionally directed the Applicant to submit it through the TDEM GMS.  The Applicant’s documentation provided on second appeal shows that it followed the Recipient’s guidance and timely submitted its first appeal through the Recipient, via the TDEM GMS, on June 3, 2022, within 60 days of its receipt of the DM. This documentation includes the TDEM GMS screenshots and activity notification emails confirming the Applicant’s successful upload and the Recipient’s receipt of the appeal on June 3, 2022,[4] along with a subsequent emails from the Recipient to the Applicant again confirming receipt of the appeal and requesting and confirming a meeting to discuss it. Therefore, the Applicant timely submitted a first appeal that met form and content requirements within the 60-day regulatory deadline. 

Following the June 3, 2022 first appeal submittal, the Recipient advised the Applicant to submit additional details and documentation. The Applicant did this on June 15, 2022, and the Recipient included the additional information in the appeal package that it forwarded to FEMA on June 24, 2022, all within the Recipient’s 60-day deadline.[5] Consequently, FEMA will consider all the documentation and/or justification contained in the Recipient’s transmittal. 

Immediate Threat, Force Account Labor and Equipment Costs

FEMA is authorized to provide PA funding for emergency protective measures to save lives and protect public health and safety.[6] For emergency protective measures to be eligible, the Applicant is responsible for showing the work is required due to an immediate threat resulting from the declared incident.[7] Eligible work under COVID-19 declarations includes cleaning and disinfection in accordance with applicable FEMA policy, and Centers for Disease Control guidance or that of an appropriate public health official available at the time the work was completed.[8] To be eligible, costs must be directly tied to the performance of eligible work and be adequately documented.[9] For emergency work, only OT labor is eligible for budgeted employees.[10] An applicant’s permanent employees are considered to be budgeted employees.[11] The straight-time salaries and benefits of an applicant’s own labor force (i.e., its budgeted employees) performing emergency work is not eligible.[12] It is the Applicant’s responsibility to substantiate its claim as eligible.[13]  If the applicant does not provide sufficient documentation to support its claim as eligible, FEMA cannot provide PA funding for the work.[14] Documentation should provide the “who, what, when, where, why, and how much” for each item claimed.[15]

Here, while the Applicant provided documentation showing payroll hours and associated payroll codes for OT work performed by various employees, these records do not identify the what, where, why, and how much for each claimed activity or otherwise provide detail or specificity regarding what the employees were doing during those hours. The Payment Detail Listing that the Applicant relies on simply shows the number of OT hours worked for each employee and does not specify the type of work performed during those hours. Although the Applicant provided a Cleaning Process document listing cleaning and disinfection tasks for various building areas, the Applicant has not demonstrated that the employees performed these tasks during the claimed OT hours. Accordingly, while the Applicant lists OT payroll hours for payroll codes for various employees, it does not list any payroll hours specifically related to performing eligible emergency protective measures in response to the declared incident, the COVID-19 pandemic. As such, the Applicant has not demonstrated the FAL OT costs on appeal are directly tied to the performance of eligible work and therefore are ineligible for PA funding.

 

Conclusion

The Applicant has demonstrated that its first appeal was filed timely. However, the Applicant has not substantiated through documentation that the FAL costs claimed are tied to the performance of eligible work. Therefore, this appeal is denied.

 

[1] Prior to this, relevant emails had been submitted to FEMA as PDFs, which showed the content that was contained in the body of each email but did not maintain the associated attachments originally sent with each transmission. In response to the RFI, however, the Applicant transmitted copies of the actual emails (saved as .msg) that maintained the original attachments sent with each transmission. For example, the Recipient transmitted the Applicant’s complete April 13, 2022 email, which contained the Applicant’s summary sheet for overtime (OT) costs paid and the Applicant’s original draft appeal letter. In this letter, the Applicant provided documented justification it believed supported its position, specifying: (1) that the claimed force account labor OT in dispute was $185,934.42 for 280 hours; (2) that employee hours were used to disinfect school buses and schools per Centers for Disaster Control guidance; and (3) the provisions in the Robert T. Stafford Disaster Relief and Emergency Assistance Act and FEMA policies with which the Applicant believed the DM was inconsistent.    

[2] Robert T. Stafford Disaster Relief and Emergency Assistance  (Stafford) Act  § 423(a), Title 42, United States Code (42 U.S.C.) 5189a(a) (2018).

[3] Title 44 of the Code of Federal Regulations (C.F.R.) §§ 206.206(a), 206.206(c)(1) (2019).

[4] See e.g., Email from Grants.TDEM.Texas.Gov, to Representative, Tex. Div. of Emergency Mgmt. (June 3, 2022, 1527 CST) (entitled “Activity Notification” and stating “Appeal #1 - 4485 (PA) / Austin Independent School District (ISD) / Project #337 - DR 4485 FEMA Deep Cleaning Jan20 thu [sic] Mar13 202 [sic] (S, Cat B): Advanced to Step 2) Verify Completeness of Appeal Request”).

[5] See 44 C.F.R. § 206.206(c)(2) (“The recipient will review and forward appeals from an applicant, with a written recommendation, to the Regional Administrator within 60 days of receipt.”). Under Federal regulations, the Applicant was not precluded from providing additional documentation and/or justification to the Recipient within the Recipient’s 60-day deadline for transmittal of the Applicant’s appeal to FEMA for consideration as part of the Recipient’s recommendation and submittal.

[6] Stafford Act §§ 403, 502, 42 U.S.C. §§ 5170b, 5192; 44 C.F.R. § 206.225(a); Public Assistance Program and Policy Guide, FP 104-009-21, at 42 (April 2018) [hereinafter PAPPG].

[7] 44 C.F.R. §§ 206.223(a)(1), 206.225(a)(3)(i); PAPPG, at 19, 57.

[8] FEMA Policy FP 104-21-0003, Coronavirus (COVID-19) Pandemic: Safe Opening and Operation Work Eligible for Public Assistance (Interim) (Version 2), at 3-5 (Sept. 8, 2021) [hereinafter O&O Policy].

[9] PAPPG, at 21.

[10] 44 C.F.R. § 206.228(a)(2)(iii); PAPPG, at 24.

[11] PAPPG, at 24.

[12] 44 C.F.R. §206.228(a)(2)(iii) (stating the straight-or regular-time salaries and benefits of a recipient’s or applicant’s permanently employed personnel are not eligible in calculating the cost of eligible emergency protective measures, except for those costs associated with host state evacuation and sheltering); PAPPG, at 24.

[13] PAPPG, at 133.

[14] Id.; see O&O Policy, at 3-4 (“In considering the allowability of costs, FEMA will evaluate, among other factors, whether the cost is documented with sufficient detail for FEMA to evaluate its compliance with federal laws, rules, and other PA program requirements.”).

[15] PAPPG, at 133.