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Direct Result of Disaster, Predisaster Conditions

Appeal Brief Appeal Letter Appeal Analysis

Appeal Brief

DisasterFEMA-1791
ApplicantUniversity of Texas Medical Branch
Appeal TypeSecond
PA ID#000-UV3S5-00
PW ID#15822
Date Signed2017-05-19T00:00:00

Conclusion:  The Applicant’s proposed items of work are not required as a result of the disaster.  They are modifications to address pre-existing inadequacies in the Applicant’s hot water system.  They do not restore, but rather modify, the system’s predisaster design and capacity.  The predisaster function of the hot water system has been restored through the permanent installation of Copper-Silver Ionization equipment. 

Summary Paragraph

On September 13, 2008, Hurricane Ike struck Galveston, Texas.  The resulting loss of power disrupted the hot water distribution system at the Applicant’s Healthcare Core Complex.  The loss of water circulation caused stagnation throughout the hot water distribution system.  This stagnation, combined with elevated temperatures for thirteen days, created a favorable environment for Legionella bacteria colonization.  Before the disaster, the Applicant never tested its hot water distribution system for Legionella since it was not required to do so.  After the disaster, the Applicant detected the presence of Legionella within the hot water system and installed point-of-use water filters and performed short-term Copper-Silver Ionization (CSI) treatments.  FEMA funded these emergency protective measures in Project Worksheet (PW) 15823 and awarded the Applicant $1,294,123.85.    These emergency protective measures were funded until August 25, 2011, when the Applicant received authorization from the Texas Commission on Environmental Quality (TCEQ) to permanently install and operate CSI equipment.  In December of 2012, FEMA approved PW 15822 (Category E) for $529,631.16 for the purchase, permanent installation, and start-up of a CSI system.  Based on a consultant’s report which recommended various improvements to the hot water system, the Applicant also requested an additional $12,248,641.00 in Public Assistance (PA) funds.  However, FEMA determined the Applicant’s requested items of work (i.e. replacing storage tanks, modifying recirculation systems, installing instantaneous hot water heaters, providing ultra-violet radiation, removing dead leg piping, and relocating water softeners and pumps) were not required as a result of the disaster and therefore denied the Applicant’s request for the additional $12,248,641.00.  In March 2013, the Applicant appealed arguing that CSI treatments alone would not rid its hot water system of Legionella.  The Applicant sought an additional $12,248,641.00 to replace storage tanks, modify recirculation systems, install instantaneous hot water heaters, provide ultra-violet radiation, remove dead leg piping, and relocate water softeners and pumps.  On February 10, 2016, the FEMA Regional Administrator (RA) denied the Applicant’s appeal.  The RA stated that the Applicant’s hot water system was not physically damaged by the disaster.  The proposed items of work were not repairs of disaster-related damage, but rather modifications to remove pre-existing inadequacies in the system.  On April 25, 2016, the Applicant filed its second appeal.  The Applicant argued that FEMA is required to restore the hot water system to its predisaster condition.  The Applicant maintains that the predisaster condition to be restored is a hot water system that is free from Legionella bacteria, thus requiring replacement of major system components.

Authorities and Second Appeals

  • Stafford Act § 406.
  • 44 C.F.R. §§ 206.201(h), 206.223(a)(1).
  • PA Guide, at 29, 54, 79.
  • Univ. of Tex. Med. Branch., FEMA-1791-DR-TX, at 1, 4, 5.
  • City of Boulder, FEMA-4145-DR-CO, at 4.
  • Delaware Cty. Dept. of Pub. Works, FEMA-4020-DR-NY, at 2, 3.

Headnotes

  • Per 44 C.F.R. § 206.223(a)(1), to be eligible for financial assistance, an item of work must be required as the result of a major disaster event.
  • Per the PA Guide, at 29, work to correct inadequacies that existed prior to the disaster, is not eligible.
  • The Applicant’s proposed items of work are not required as a result of the disaster.  They are modifications to address pre-existing inadequacies in the hot water system.
  • Per the PA Guide, at 79, permanent work is that which is required to restore a damaged facility, through repair or restoration, to its pre-disaster design, function, and capacity.
    • The Applicant’s proposed modifications to its hot water system would change the predisaster design of the facility and improve its predisaster capacity.
    • The facility’s predisaster function of providing safe, usable hot water, has already been restored through the permanent installation of a CSI system.

Appeal Letter

W. Nim Kidd, CEM
Assistant Director, Texas Department of Public Safety
Texas Division of Emergency Management
PO Box 4087
Austin, Texas 78773-0220

Re: Second Appeal – FEMA-1791-DR-TX, University of Texas Medical Branch, Project Worksheet 15822 – Direct Result of Disaster, Predisaster Conditions

Dear Chief Kidd:

This is in response to a letter from your office dated April 27, 2016, which transmitted the referenced second appeal on behalf of the University of Texas Medical Branch (Applicant).  The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of funding in the amount of $12,248,641.00 for permanent modifications to the hot water system of the Healthcare Core Complex.

As explained in the enclosed analysis, I have determined that the proposed items of work are not required as a direct result of the disaster but rather, are modifications to address pre-existing inadequacies in the system.  The facility’s predisaster function of delivery of safe, usable hot water, was restored through the permanent installation of a Copper-Silver Ionization system.

Accordingly, I am denying this appeal.  Please inform the Applicant of my decision.  This determination is the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.

Sincerely,

/s/
Christopher Logan
Director
Public Assistance Division                                                                       

Enclosure

cc: George A. Robinson
      Regional Administrator
      FEMA Region VI

Appeal Analysis

Background

On September 13, 2008, Hurricane Ike struck Galveston, Texas.  The resulting loss of power disrupted the domestic hot water distribution system at the University of Texas Medical Branch (Applicant) Healthcare Core Complex.  The loss of water circulation caused stagnation throughout the hot water distribution system.  This stagnation, combined with elevated temperatures for thirteen days, created a favorable environment for Legionella bacteria colonization.  Before the disaster, the Applicant never tested its hot water distribution system for Legionella since it was not required to do so.  After the disaster, the Applicant detected the presence of Legionella within the hot water system and installed point-of-use water filters and performed short-term Copper-Silver Ionization (CSI) treatments.  FEMA funded these emergency protective measures in Project Worksheet (PW) 15823 and awarded the Applicant $1,294,123.85.  These emergency protective measures were funded by FEMA until August 25, 2011, when the Applicant received authorization from the Texas Commission on Environmental Quality (TCEQ) to permanently install and operate CSI equipment.[1]  In December of 2012, FEMA approved PW 15822 (Category E) for $529,631.16 for the purchase, permanent installation, and start-up of a CSI system. [2]  Based on a consultant’s report which recommended various improvements to the hot water system,[3] the Applicant also requested an additional $12,248,641.00 in Public Assistance (PA) funds.  However, FEMA determined the Applicant’s requested items of work (i.e. replacing storage tanks, modifying recirculation systems, installing instantaneous hot water heaters, providing ultra-violet radiation, removing dead leg piping, and relocating water softeners and pumps) were not required as a result of the disaster and therefore denied the funding request.  

First Appeal

On March 22, 2013, the Applicant appealed arguing that CSI treatments alone would not rid its hot water system of Legionella.[4]  The Applicant sought the additional funding to modify its hot water system as part of a comprehensive approach to combat the Legionella colonization.[5]  The FEMA Regional Administrator (RA) denied the Applicant’s appeal on February 10, 2016, finding that the Applicant’s hot water system was not physically damaged by the disaster.  As such, the Applicant’s requested modifications were not required as the result of the disaster in accordance with 44 C.F.R. § 206.223(a)(1).  Rather, the requested items of work were modifications to address pre-existing inadequacies in the system.  Therefore, the proposed items of work were not eligible.

Second Appeal

Through its April 25, 2016 second appeal of the RA’s decision, the Applicant asserts the Legionella colonization in its hot water system was the direct result of the disaster.[6]  The Applicant argues that FEMA is required to restore the hot water system to its predisaster condition, which, although it did not test for Legionella prior to the disaster, is a hot water system without such colonization.[7]  The Applicant acknowledges that it currently and effectively uses point-of-use filters and CSI treatment in its hot water system but views such actions as temporary measures.  The Applicant also notes the costs associated with these temporary measures will continue into perpetuity without a permanent solution.  The Applicant reiterates its request for FEMA to fund the replacement storage tanks, modification of recirculation systems, installation of instantaneous hot water heaters, removal of dead leg piping, and relocation of water softeners and pumps, in the amount of $12,248,641.00.[8]

Discussion

Result of the Disaster

To be eligible for financial assistance, an item of work must be required as the result of the major disaster event.[9]  Repair of non-disaster related damage, or work to correct inadequacies that existed prior to the disaster, is not eligible for reimbursement.[10]

The items of work for which Applicant seeks financial assistance (i.e. replacing storage tanks, modifying recirculation systems, installing instantaneous hot water heaters, providing ultra-violet radiation, removing dead leg piping, and relocating water softeners and pumps) are modifications to the Applicant’s hot water system to correct inadequacies that existed prior to the disaster.  The consultant’s report clearly establishes this point in its Summary of Recommendations where it states, “[c]onsideration should be given by UTMB to implement plumbing modifications to address the issues of poor flow and other issues presented by existing plumbing systems that are potential contributing factors to Legionella colonization of the hot water distribution systems.”[11]  The poor flow and other issues that would be remedied by the Applicant’s proposed modifications were not caused by or a result of the disaster.  Rather, these deficiencies existed for years prior to the disaster.  As a result, the Applicant’s proposed items of work are not eligible for PA funding.

Predisaster Condition

The Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) Section

406(e) authorizes FEMA to fund the cost of repairing, restoring, reconstructing, or replacing an eligible facility.[12]  Such work is commonly referred to as permanent work.  Permanent work is that which is required to restore a damaged facility, through repair or restoration, to its pre-disaster design, function, and capacity in accordance with applicable codes or standards.[13] 

Whether the Applicant’s proposed items of work restores the predisaster condition of its facility necessarily requires closer examination of the three elements of predisaster condition.

Predisaster Design

FEMA provides funds to restore a facility to its pre-disaster design or to a design in accordance with an applicable standard.  “Predisaster design” is defined as the size or capacity of a facility as originally designed and constructed or subsequently modified by changes or additions to the original design.[14]  The Applicant urges FEMA to adopt the consultant’s recommendations, a plan to drastically modify and improve the design of the current hot water system in the following fashion:

  • Replacing the existing hot water storage tanks and heaters with instantaneous or semi-instantaneous water heaters.[15]
  • Modifying the domestic hot water recirculation systems to increase the rate and volumes such that recirculation return water temperatures are within 5°F of the water temperatures leaving the heaters.[16]
  • Extending the domestic water recirculation system further than currently required by local codes.[17]
  • Installing UV Radiation on the recirculation water line.[18]

In this instance, the proposed items of work significantly improve and expand upon the hot water system’s current design.  As such, the work exceeds restoring the system to predisaster design.  

Predisaster Function

FEMA’s PA Guide notes that a facility must perform the same function it was performing before the disaster.[19]  The Applicant argues FEMA must return the facility to, “a functional system without Legionella colonization.”[20]  However, the Applicant has not demonstrated the absence of Legionella bacteria prior to the disaster as they did not perform any testing.  Without any baseline measure of the hot water system prior to the disaster, and knowledge that elements of its predisaster design (e.g. dead legs) create environments where Legionella exists, the Applicant’s claim of a Legionella-free facility is not compelling.[21]  This is crucial because, contrary to the Applicant’s assertion, Legionella is commonly present in man-made water systems in low or undetectable amounts.[22]  The predisaster function in question is not a “system without Legionella colonization,” a potentially impossible task; but rather, a system that delivers safe, usable hot water. 

FEMA has already funded the purchase and permanent installation of CSI equipment for the Applicant’s hot water system.  Yet, the Applicant maintains that the CSI equipment is a temporary solution.[23]  However, the Applicant has not posited any evidence to support the assertion that once Legionella colonization occurs, a potable water system must be replaced or drastically modified.  The consultant’s report indicates that the treatment and preventative measures that have been employed are effective to restore a water distribution system’s function.[24]  Specifically, the consultant’s report recommends the use of Copper-Silver Ionization in a water system that has been colonized by Legionella.[25]  This recommendation is supported by medical literature[26] and published industry guidelines endorse the use of CSI in hospital hot water systems. [27]    

The Applicant has regularly stated that “UTMB did not have patients diagnosed with Legionella prior to Hurricane Ike, nor have we had any patients diagnosed with Legionella since.”[28]  As such, this observation confirms that permanent installation of CSI equipment has been effective in remediating the level of Legionella in the Applicant’s hot water system and it has been restored to its predisaster function (i.e. delivery of safe, usable hot water).

Predisaster Capacity

The PA Guide provides, “[t]he restored facility must operate at the capacity available before the disaster.”[29]  As previously noted, the recommendations contained in the consultant’s report drastically modify the Applicant’s hot water system.  In addition to altering the predisaster design, the proposed items of work modify and improve upon the predisaster capacity of the Applicant’s hot water system.  These modifications do not maintain nor restore the hot water system’s predisaster capacity.

Increased Operating Expenses

The Applicant maintains that the permanent installation of CSI equipment is a temporary solution and that the costs associated with it are significant and will continue into perpetuity without a permanent solution.  While FEMA policy acknowledges that costs of operating a facility or providing a service may increase due to or after a disaster, these costs, with few exceptions, are not eligible.[30]  FEMA previously determined the operation and maintenance costs associated with the permanent installation of CSI equipment to be ineligible increased operating expenses and will not revisit the argument here.[31] 

Conclusion

The Applicant’s proposed items of work are not required as a result of the disaster.  They are modifications to address pre-existing inadequacies in the Applicant’s hot water system, which alter the system’s predisaster design and capacity.  FEMA has already funded the purchase and permanent installation of CSI equipment, thereby restoring the hot water system’s predisaster function of providing safe, usable hot water, as required by federal regulation and FEMA policy.  Therefore, the Applicant’s appeal is denied.

 

[1] Letter from Tex. Comm'n on Envtl. Quality, to Representative, Preferred Eng'g, at 1 (Aug. 25, 2011).

[2] Project Worksheet 15822, University of Texas Medical Branch, Version (0) (Sep. 13, 2012) ($525,881.16 for the CSI system and $3750.00 for Direct Administrative Costs for a total of $529,631.16).

[3] Report from HDR/EBSol, Inc. to UTMB, UTMB Healthcare Buildings, Domestic Water Recommendations, at 2, 4-6 (Feb. 11, 2011) [hereinafter Consultant’s Report].

[4] Letter from Vice President, Fin. Accounting and Reporting, Univ. of Tex. Med. Branch, to Chief, Tex. Div. of Emergency Mgmt, at 2 (Mar. 22, 2013).

[5] Id.

[6] Letter from Vice President, Fin. Accounting and Reporting, Univ. of Tex. Med. Branch to Chief, Tex. Div. of Emergency Mgmt, attach. at 3 (Apr. 25, 2016) [hereinafter Applicant’s Second Appeal Letter].

[7] Id. at 4.

[8] Id. at 3.

[9] Title 44 Code of Federal Regulations (44 C.F.R.) § 206.223(a)(1) (2007); Public Assistance Guide, FEMA 322, at 29 (June 2007) [hereinafter PA Guide].

[10] PA Guide, at 29.

[11] Consultant’s Report, at 2. (emphasis added) (Thus, the consultant’s report refutes the Applicant’s argument that, “the conditions that caused the Legionella colonization currently plaguing UTMB’s water supply did not exist prior to Hurricane Ike.”).

[12] The Robert T. Stafford Disaster Relief and Emergency Assistance Act of 1988, Pub. L. No. 93-288, § 406, 42

U.S.C. § 5172 (2006).

[13] PA Guide, at 79.  See also FEMA Second Appeal Analysis, Delaware Cty. Dept. of Pub. Works, FEMA-4020-DR-NY, at 2 (July 6, 2015).

[14] 44 C.F.R. § 206.201(h).

[15] Consultant’s Report, at 4.

[16] Id. at 5.

[17] Id. at 6.

[18] Id.

[19] PA Guide, at 79.

[20] Applicant’s Second Appeal Letter, at 4.

[21] FEMA Second Appeal Analysis, City of Boulder, FEMA-4145-DR-CO, at 4 (Jan. 19, 2017) (“As reflected in 44 C.F.R. § 206.206(a), the Applicant, as the proponent of the relief sought, must provide documented justification needed to support eligibility.”).

[22] Minimizing the Risk of Legionellosis Associated with Building Water Systems, American Society of Heating, Refrigerating and Air Conditioning Engineers (ASHRAE), ASHRAE Guideline 12-2000, at 2 (Feb. 10, 2000). (“Legionellae bacteria are commonly present in natural and man-made aquatic environments… In natural water sources and municipal water systems, legionellae (sic) are generally present in very low or undetectable concentrations.”) [hereinafter ASHRAE Guidelines].  See also Applicant’s Second Appeal Letter, at 1 (“Legionella bacteria can also exist in a benign fashion within a water system.”).

[23] Applicant’s Second Appeal Letter, at 6.

[24] Consultant’s Report, at 1 (“Research suggests that to achieve a sustained reduction in Legionella colonization, a facility should focus on implementation of Legionella prevention measures to reduce the percentage of sites testing positive for the presence of the organism.”).

[25] Id. at 2 (“Copper/Silver (Cu/Ag) Ionization is recommended on the hot water distribution system as an evidence based solution for control for Legionella.”) (emphasis in original).

[26] Letter from HDR/EBSol, Inc., to UTMB, at 2 (Feb. 11, 2011) [hereinafter Consultant’s Report Cover Letter] (citing several medical journal publications which demonstrate the effectiveness of using CSI to combat Legionella in a potable water system.).

[27] ASHRAE Guidelines, at 4. (“Copper-silver ionization is a relatively new approach to controlling Legionella in hot water distribution systems and has been used successfully in a number of hospitals.”).

[28] Applicant’s Second Appeal Letter, at 7.

[29] PA Guide, at 79.

[30] Id. at 54.

[31] See FEMA Second Appeal Analysis, University of Texas Medical Branch, FEMA-1791-DR-TX, PW 15823, at 6-7 (Sep. 30, 2016).

Last updated May 28, 2020