Design Engineering Costs
|Applicant||City of Santa Monica|
Citation: FEMA-1008-DR-CA; City of Santa Monica PA ID 037-70000; DSR 74100.
Reference: Northridge Earthquake; Design Engineering Costs.
Summary: DSR 74100 was written to cover repairs to the Memorial Park Gymnasium of Santa Monica. Because the repairs were limited to patch and paint of drywall and stucco and other minor repairs, the engineering design costs of $692 were deleted from the DSR. The Disaster Recovery Manager denied the first appeal for the same reason. The applicant submitted a second appeal in which it did not request additional repair costs. The City, however, requested the reinstatement of the design engineering costs, but at $3,663.60. The increase was based on the City's own estimates of the eligible repair costs.
Issue: Is the City eligible to receive design engineering costs on the patch and paint repairs to the Memorial Park Gymnasium?
Findings: No. Eligibility of engineering design costs on repair work depends on the scope of work and the complexity, and the specific need for these services. Patch and paint repair work does not justify engineering design services.
Rationale: Pursuant to 44 CFR 206.228(a)(2)(ii), a 3% allowance for basic construction inspection services was included in the DSR, and 44 CFR 206.228(a)(3)(ii) does not permit any other administrative costs.
November 4, 1997
Mr. Gilbert Najera
Governor's Authorized Representative
Governor's Office of Emergency Services
74 North Pasadena Avenue, West Annex, Second Floor
Pasadena, California 91103
Dear Mr. Najera:
This is in response to your August 20, 1997, letter forwarding the City of Santa Monica's June 7, 1997, second appeal for the inclusion of engineering, design and bid preparation costs in damage survey report (DSR) 74100. The item was declared ineligible at the DSR review that authorized funding of $8,913 towards repairs to the Memorial Park Gymnasium in Santa Monica. On October 25, 1995, the City submitted a first appeal to the Regional Director asking for the reinstatement of this and other deleted items. The Federal Emergency Management Agency's (FEMA's) Disaster Recovery Manager denied the appeal. The engineering, design and bid preparation costs item was denied because the approved scope of work-patch and paint of drywall and stucco, and other minor repairs-did not require engineering design services.
In this second appeal, the City is claiming that it did not concur with the findings of the initial DSR inspection and had at the time attached a narrative showing that its estimate for disaster-related repairs was $72,358. Notwithstanding, the City is not at this time appealing for the inclusion of this cost, rather it is arguing that the engineering and design costs were eligible for reimbursement because they were directly related to repairing a publicly owned earthquake-damaged facility. The actual construction costs are now quoted to be $62,410 with computed engineering design costs of $3,663.60. The City concludes with the request "that the line item for engineering and design costs be reinstated at the actual costs of $3,663.60 for DSR 99964." (It is presumed that the reference to DSR 99964 is in error since it is a totally unrelated DSR.)
FEMA's records indicate that, at the time of writing the DSR, roof damage and associated hardwood flooring damage was determined to be preexisting. This finding was based on a January 22, 1994, report by Oakes and Associates. The City inspector wrote a non-concurrence of FEMA's findings but the City presented no documentation to support its claims of more eligible damage. The eligible repair work was determined to be relatively minor repairs-patch and paint of drywall and stucco-as itemized on page 11 (of 18) of the DSR. This type of work in general does not require engineering and design services.
Accordingly, I am denying the second appeal. Please inform the applicant of my determination. The applicant may submit a third appeal to the Director of FEMA. The appeal must be submitted through your office and the Regional Director within 60 days of receipt of this determination.
Lacy E. Suiter
Executive Associate Director
Response and Recovery Directorate