Earthquake-related rent control activities
Appeal Brief
Appeal Letter
PURPOSE: To obtain signature on the letter to the California Governor's Authorized Representative denying the City of Santa Monica's (City) request for costs incurred by the Rent Control Board (RCB) for work to remove damaged properties from the rent restriction rolls and/or to increase rents.
DISCUSSION: The City suffered extensive facility damage as a result of the Northridge Earthquake and the RCB subsequently amended its regulations by establishing an administrative appeal process to encourage the prompt rehabilitation of buildings. As a result, FEMA prepared DSR 44927 for $232,338 for costs associated with the earthquake-related rent control activities. Upon review, the DSR was approved for $0 because the rent control activities were not eligible costs, pursuant to the Stafford Act (Act). On September 15, 1995, the State forwarded the City's request of eligibility (treated as a first appeal). The Northridge Area Recovery Manager determined that the rent control programs were not authorized by the Act and denied the appeal. In the second appeal, the City claimed that the RCB activities were essential to ensure that health and safety were maintained and that FEMA's denial was not based on statute or regulation. The Executive Associate Director denied the second appeal and determined that the RCB's work was designed to provide rent restriction relief to owners to induce them to make repairs so that tenants could be rehoused, not for health and safety. The third appeal submission identifies the role of the RCB in relation to other City agencies and reiterates the previous appeals. There is no basis to reverse previous appeal decisions.
RECOMMENDATION: Sign the letter denying the subgrantee's third appeal.
Appeal Brief
| Disaster | FEMA-1008-DR |
| Applicant | City of Santa Monica and the Rent Control Board |
| Appeal Type | Third |
| PA ID# | 037-70000 |
| PW ID# | 44927 |
| Date Signed | 1999-06-01T04:00:00 |
DISCUSSION: The City suffered extensive facility damage as a result of the Northridge Earthquake and the RCB subsequently amended its regulations by establishing an administrative appeal process to encourage the prompt rehabilitation of buildings. As a result, FEMA prepared DSR 44927 for $232,338 for costs associated with the earthquake-related rent control activities. Upon review, the DSR was approved for $0 because the rent control activities were not eligible costs, pursuant to the Stafford Act (Act). On September 15, 1995, the State forwarded the City's request of eligibility (treated as a first appeal). The Northridge Area Recovery Manager determined that the rent control programs were not authorized by the Act and denied the appeal. In the second appeal, the City claimed that the RCB activities were essential to ensure that health and safety were maintained and that FEMA's denial was not based on statute or regulation. The Executive Associate Director denied the second appeal and determined that the RCB's work was designed to provide rent restriction relief to owners to induce them to make repairs so that tenants could be rehoused, not for health and safety. The third appeal submission identifies the role of the RCB in relation to other City agencies and reiterates the previous appeals. There is no basis to reverse previous appeal decisions.
RECOMMENDATION: Sign the letter denying the subgrantee's third appeal.
Appeal Letter
June 1, 1999
Mr. Gilbert Najera
Governor's Authorized Representative
74 North Pasadena Avenue, West Annex
Pasadena, California 91103
Dear Mr. Najera:
This is in response to your letter dated May 6, 1998, to the Federal Emergency Management Agency (FEMA). With that letter, you forwarded a third appeal of Damage Survey Report (DSR) 44927 under FEMA-1008-DR-CA on behalf of the City of Santa Monica and the Rent Control Board (RCB). The subgrantee is requesting $232,338 for administrative expenses for labor expenses to perform inspections and process requests.
On January 17, 1994, the City suffered extensive structural damage as a result of the Northridge Earthquake. Subsequently, RCB amended its regulations by establishing an administrative appeal process to encourage the prompt rehabilitation of buildings damaged by the earthquake. As a result, FEMA prepared DSR 44927 for $232,338 for administrative costs associated with disaster-related rent control activities. Upon review, the DSR was approved for $0 because the expenses were covered by the statutory administrative allowance and the rent control activities were not eligible expenses, as defined in the Stafford Act (Act). The State subsequently forwarded additional information from the City regarding the eligibility of the expense. The Northridge Area Recovery Manager reiterated that rent control programs were not authorized by the Act, and denied the appeal.
In the second appeal, the City claimed that RCB's activities were essential to ensure that health and safety were maintained and that FEMA's denial was not based on statute or regulation. In support of the appeal, the State referred to FEMA funding for the City of Los Angeles for costs associated with issuing permits to facilitate demolition of unsafe structures that presented an immediate threat. During review of the second appeal of DSR 44927, FEMA prepared DSR 45684 for $295,887 for the same force account labor expenses. However, FEMA again determined that these activities were not eligible emergency protective measures and the DSR was approved for $0. In the second appeal response, the Executive Associate Director stated that RCB's work was designed to provide rent restriction relief to owners to induce them to make repairs so that tenants could be rehoused. Additionally, the Executive Associate Director stated that the City of Los Angeles was granted a waiver for permit processing and inspections under unique circumstances to facilitate health and safety. He denied the second appeal.
In the third appeal, the applicant reiterates the arguments of the first and second appeals. In support of the appeal, the applicant provides additional information regarding the relationships between various City agencies and the RCB and identifies the following as the primary issues: 1) Section 403 of the Act and the activities of the RCB; 2) The eligibility of the expenses under Title 44 of the Code of Federal Regulations; 3) The eligibility of the expenses under FEMA's waiver for building permits; and 4) Denial of due process for the City.
Regarding the first issue, the applicant provides information regarding the relationship of the various City departments, specifically the City's Building and Safety Department (BSD). The applicant states RCB, in conjunction with BSD, "provided front line communication with tenants and landlords about their properties . to insure and facilitate prompt rebuilding of City's residential rental housing.." This is in keeping with pages four and five of RCB's Charter which list the powers and duties of RCB, including setting rent ceilings, removing rent controls, and registering rental units. As stated previously, these activities do not constitute emergency protective measures and are not eligible pursuant to Section 403 of the Stafford Act.
Issues 2 and 3 were sufficiently addressed in the enclosed second appeal response. In thorough detail, the enclosed second appeal explained that the expenses were neither an emergency response or emergency restoration and, as such, were not eligible for funding, pursuant to Section 403 or 406 of the Act. No additional information was provided to reverse the previous decision regarding the eligibility of these expenses.
The remaining issue is whether the applicant received due process for DSR 44927. FEMA prepared the DSR for $295,887 for activities, including labor expenses for administration of public contracts, inspections, and petitioning rent increases. During FEMA's normal review process of the DSR, it was determined that these costs were not eligible. The disaster regulations provide for three levels of appeal. The applicant has submitted three appeals to FEMA. Therefore, the applicant has been afforded due process pursuant to the regulations.
Based on a thorough review of the information submitted, I uphold the decision of the Executive Associate Director and deny the third appeal. Please inform the applicant of my determination. This is the third and final level of appeal, pursuant to 44 CFR 206.206.
Sincerely,
/S/
James L. Witt
Director
cc: Christina Lopez
Federal Coordinating Officer
FEMA-1008-DR-CA
Mr. Gilbert Najera
Governor's Authorized Representative
74 North Pasadena Avenue, West Annex
Pasadena, California 91103
Dear Mr. Najera:
This is in response to your letter dated May 6, 1998, to the Federal Emergency Management Agency (FEMA). With that letter, you forwarded a third appeal of Damage Survey Report (DSR) 44927 under FEMA-1008-DR-CA on behalf of the City of Santa Monica and the Rent Control Board (RCB). The subgrantee is requesting $232,338 for administrative expenses for labor expenses to perform inspections and process requests.
On January 17, 1994, the City suffered extensive structural damage as a result of the Northridge Earthquake. Subsequently, RCB amended its regulations by establishing an administrative appeal process to encourage the prompt rehabilitation of buildings damaged by the earthquake. As a result, FEMA prepared DSR 44927 for $232,338 for administrative costs associated with disaster-related rent control activities. Upon review, the DSR was approved for $0 because the expenses were covered by the statutory administrative allowance and the rent control activities were not eligible expenses, as defined in the Stafford Act (Act). The State subsequently forwarded additional information from the City regarding the eligibility of the expense. The Northridge Area Recovery Manager reiterated that rent control programs were not authorized by the Act, and denied the appeal.
In the second appeal, the City claimed that RCB's activities were essential to ensure that health and safety were maintained and that FEMA's denial was not based on statute or regulation. In support of the appeal, the State referred to FEMA funding for the City of Los Angeles for costs associated with issuing permits to facilitate demolition of unsafe structures that presented an immediate threat. During review of the second appeal of DSR 44927, FEMA prepared DSR 45684 for $295,887 for the same force account labor expenses. However, FEMA again determined that these activities were not eligible emergency protective measures and the DSR was approved for $0. In the second appeal response, the Executive Associate Director stated that RCB's work was designed to provide rent restriction relief to owners to induce them to make repairs so that tenants could be rehoused. Additionally, the Executive Associate Director stated that the City of Los Angeles was granted a waiver for permit processing and inspections under unique circumstances to facilitate health and safety. He denied the second appeal.
In the third appeal, the applicant reiterates the arguments of the first and second appeals. In support of the appeal, the applicant provides additional information regarding the relationships between various City agencies and the RCB and identifies the following as the primary issues: 1) Section 403 of the Act and the activities of the RCB; 2) The eligibility of the expenses under Title 44 of the Code of Federal Regulations; 3) The eligibility of the expenses under FEMA's waiver for building permits; and 4) Denial of due process for the City.
Regarding the first issue, the applicant provides information regarding the relationship of the various City departments, specifically the City's Building and Safety Department (BSD). The applicant states RCB, in conjunction with BSD, "provided front line communication with tenants and landlords about their properties . to insure and facilitate prompt rebuilding of City's residential rental housing.." This is in keeping with pages four and five of RCB's Charter which list the powers and duties of RCB, including setting rent ceilings, removing rent controls, and registering rental units. As stated previously, these activities do not constitute emergency protective measures and are not eligible pursuant to Section 403 of the Stafford Act.
Issues 2 and 3 were sufficiently addressed in the enclosed second appeal response. In thorough detail, the enclosed second appeal explained that the expenses were neither an emergency response or emergency restoration and, as such, were not eligible for funding, pursuant to Section 403 or 406 of the Act. No additional information was provided to reverse the previous decision regarding the eligibility of these expenses.
The remaining issue is whether the applicant received due process for DSR 44927. FEMA prepared the DSR for $295,887 for activities, including labor expenses for administration of public contracts, inspections, and petitioning rent increases. During FEMA's normal review process of the DSR, it was determined that these costs were not eligible. The disaster regulations provide for three levels of appeal. The applicant has submitted three appeals to FEMA. Therefore, the applicant has been afforded due process pursuant to the regulations.
Based on a thorough review of the information submitted, I uphold the decision of the Executive Associate Director and deny the third appeal. Please inform the applicant of my determination. This is the third and final level of appeal, pursuant to 44 CFR 206.206.
Sincerely,
/S/
James L. Witt
Director
cc: Christina Lopez
Federal Coordinating Officer
FEMA-1008-DR-CA
Last updated