Force Account Labor & Equipment Costs

Appeal Brief

Summary Paragraph

During the period of August 22, 2020, through August 27, 2020, Hurricane Laura impacted Plaquemines Parish (Applicant). FEMA wrote Grants Manager Project (GMP) 165956, in the amount of $375,067.34, for the use of force account labor for emergency protective measures. In a Determination Memorandum, FEMA denied $53,269.77 for force account labor straight-time hours. FEMA found the straight-time hours paid as overtime were part of the Applicant’s budget prior to the disaster and therefore not eligible. The Applicant appealed FEMA’s determination and stated the funding denied represents regular time hours paid at the employee’s overtime rate and that it only budgeted for the straight-time pay rate of its employees. The Region 6 Regional Administrator denied the Applicant’s appeal, finding the force account labor cost represented straight-time hours worked by the Applicants budgeted employees and are not overtime labor costs nor extraordinary costs for employees called back to work during administrative leave. The Applicant submitted a second appeal and reiterated its prior arguments, specifically that the employees were essential employees called back to work during administrative leave to perform eligible emergency work. The Applicant provided an email from the Parish President dated August 23, 2020, which informed all staff that the Applicant’s offices would be closed and communicated that only essential employees were to report to work. the Recipient expressed its support of the Applicant’s appeal. The Recipient referenced a second appeal determination for Broward County School District, which it argued FEMA found similar costs eligible.

Authorities

• Stafford Act § 403(a).
• 44 C.F.R. 206.225(a), 206.228(a)(2)(iii).
• PAPPG, at 69 – 71.
• Plaquemines Parish, FEMA-3543-EM-LA (Feb. 13, 2024). Broward County School District, FEMA-4283-DR-FL (Oct. 11, 2019).

Headnotes

• For emergency work, generally only overtime labor is eligible for budgeted employees; except in limited circumstances, the straight-time of an applicant’s budgeted employees performing emergency work is ineligible. FEMA may reimburse extraordinary costs (such as call back pay and hazardous duty pay) for essential employees who are called back to duty during administrative leave to perform eligible emergency work if costs are paid in accordance with a labor policy that meets certain criteria. 
  • The employees were essential employees who were informed that government offices would be closed on subsequent dates, but that they were still required to report to work. This resulted in those employees performing emergency work during their regularly scheduled hours, without ever being “called back” to work.

Conclusion

The claimed FAL costs are neither associated with overtime labor costs nor are they extraordinary costs for essential employees called back to work during administrative leave to perform eligible emergency work. Therefore, this appeal is denied.

Appeal Letter

Appeal Analysis

Background

During the period of August 22, 2020, to August 27, 2020, Hurricane Laura impacted Plaquemines Parish (Applicant). FEMA wrote Grants Manager Project (GMP) 165956, in the amount of $375,067.34, documenting the use of force account labor, force account equipment, materials, and contracts to perform emergency work including flood control such as sandbagging, emergency pumping, evacuation and sheltering, and temporary flood walls. In a Determination Memorandum dated March 6, 2023, FEMA denied $53,269.77 for force account labor straight-time hours that were paid at an overtime (OT) rate, because the straight-time hours were associated with budgeted employees who worked during regularly scheduled hours.[1] FEMA found the straight-time hours were part of the Applicant’s budget prior to the disaster and therefore ineligible. FEMA approved $321,797.58 for the remaining emergency work costs found eligible. 

First Appeal 

In a letter dated August 14, 2023, the Applicant appealed FEMA’s denial of $53,269.77.[2] The Applicant referenced policy language in FEMA’s Public Assistance Program and Policy Guide (PAPPG) regarding budgeted versus unbudgeted hours for emergency work. The Applicant stated the requested funding represented straight-time hours paid at the employee’s OT rate and that it only budgeted for the straight-time pay rate of its employees. The Applicant asserts FEMA incorrectly relied on whether the employee itself is budgeted or unbudgeted instead of whether the hours worked were budgeted. In a letter dated October 3, 2023, the Governor’s Office of Homeland Security and Emergency Preparedness (Recipient) forwarded the appeal to FEMA and reiterated the Applicant’s position.

In a letter dated November 16, 2023, the Region 6 Regional Administrator denied the Applicant’s appeal, finding the force account labor cost represented straight-time hours worked by the Applicant’s budgeted employees and were not OT labor costs nor extraordinary costs for employees called back to perform eligible work during administrative leave.

Second Appeal

On January 16, 2024, the Applicant filed a second appeal, stating that the employees were essential employees called back to work during administrative leave to perform eligible emergency work and that costs were paid in accordance with its predisaster pay policy.[3] The Applicant provided a copy of an email from the Parish President dated August 23, 2020, which informed all staff that the Applicant’s offices would be closed due to the storm and communicated that only essential employees were to report to work on August 24-25, 2020. In a letter dated March 7, 2024, the Recipient expressed its support of the Applicant’s appeal. The Recipient referenced a prior second appeal decision,[4] stating that in that decision FEMA found similar costs eligible.

Discussion

FEMA is authorized to provide Public Assistance (PA) for emergency protective measures to save lives, protect public health and safety, and to protect improved property.[5] For emergency work, generally only OT labor is eligible for budgeted employees; except in limited circumstances, the straight-time of an applicant’s budgeted employees performing emergency work is ineligible.[6] OT is time worked beyond an employee’s scheduled working hours as defined by the applicant’s predisaster pay policy.[7] FEMA may reimburse extraordinary costs (such as call back pay and hazardous duty pay) for essential employees who are called back to duty during administrative leave to perform eligible emergency work if costs are paid in accordance with a labor policy that meets certain criteria.[8]

Here, the Applicant requests that FEMA reimburse the straight-time hours paid at an OT rate that the Applicant stated it was required to pay its employees under its predisaster pay policy. This includes the normal, budgeted rate of pay for employees that performed emergency work during regularly scheduled hours, including the work performed by budgeted employees that reported to work on August 24-25, 2020. For emergency work, only OT labor is eligible for budgeted employee hours, which the Applicant argues applies to its straight-time hours worked during an emergency under its pay policy. However, the Applicant’s pay policy does not define the hours worked during an emergency as OT; instead, it pays OT for hours worked in excess of the normal scheduled work hours.[9] Therefore, the claimed costs, which are for straight-time hours, conducted during the employees’ normal scheduled work hours, are ineligible for PA funding as OT.[10] 

The Applicant also argues its claimed costs are eligible as extraordinary costs of essential employees called back to duty during administrative leave; however, the record on appeal documents that these employees were not placed on leave. Rather, they were essential employees who were informed that government offices would be closed on subsequent dates, but that they were still required to report to work during those subsequent closure dates. This resulted in those employees performing emergency work during their regularly scheduled hours, without ever being “called back” to work.[11] The costs are, therefore, not eligible as extraordinary costs.[12]

Conclusion

The claimed FAL costs are neither associated with OT labor costs nor are they extraordinary costs for essential employees called back to work during administrative leave to perform eligible emergency work. Therefore, this appeal is denied.