Force Account Labor & Equipment Costs

Appeal Brief Appeal Letter Appeal Analysis

Appeal Brief

Disaster4490
ApplicantReverend Noel T. Adams Ambulance
Appeal TypeSecond
PA ID#081-09DE2-00
PW ID#GMP 662637/PW 505
Date Signed2024-05-13T16:00:00

Summary Paragraph

In response to the coronavirus (COVID-19) pandemic, the Applicant requested Public Assistance (PA) for contract costs to build a new ambulance by remounting part of an existing ambulance to a newly purchased truck chassis. FEMA prepared Grants Manager Project 662637 in the amount of $183,684.00 for the ambulance but, during closeout of the project, deducted $174,499.00 from that amount to account for the fair market value (FMV) of the ambulance. Based on information provided by the Applicant in its closeout documentation, FEMA calculated the FMV of the ambulance based on four months of use for eligible work under the project. The Applicant submitted a first appeal, disagreeing with FEMA’s use of four months in the calculation of the FMV and requesting that the full project amount be reinstated. The Applicant asserted that it placed the ambulance into service at the end of December 2021, used it to respond to COVID-19 patients until the public health emergency ended on May 11, 2023, and is still using it to respond to COVID-19 calls during the endemic phase. FEMA denied the Applicant’s first appeal, stating that it calculated the FMV of the ambulance based on the four-month time frame that the Applicant used the ambulance for the PA project, as documented in the closeout documentation. The Applicant submits its second appeal, requesting that the full project amount be reinstated, contending that the depreciation should be based on its use of the ambulance for seventeen months during the federally declared disaster. The Applicant provides call logs, which it claims support the additional use of the ambulance.

Authorities

  • Stafford Act § 403(a)(3).
  • 44 C.F.R. §§ 206.223(a)(1), 206.225(a); 2 C.F.R. § 200.313(c), (e)(2). 
  • PAPPG, at 29, 133.
  • Disposition Requirements FAQs, V.2, at 2, 4; Medical Care Policy, at 3-5. 
  • City of Atlanta, FEMA-4501-DR-GA, at 4 (Apr. 26, 2024).

Headnotes

  • When equipment purchased with PA funding is no longer needed for response to or recovery from the incident, the applicant must calculate the FMV of equipment that has a current FMV of $5,000 or more, and FEMA reduces eligible funding by this amount. The date used to determine when equipment is no longer needed is based on the work completion deadline of May 11, 2023, or information previously provided by an applicant. 
  • The Applicant did not calculate the FMV of its ambulance purchased with PA funding; therefore, FEMA calculated the FMV based on the four-month time frame the equipment was used for eligible work, and the Applicant has not substantiated that the ambulance was used for eligible work beyond that time frame. 

Conclusion

The Applicant has not demonstrated that it used its ambulance for eligible medical transports related to COVID-19 beyond the four-month time frame used by FEMA to calculate the FMV of the ambulance. Thus, the appeal is denied.

Appeal Letter

SENT VIA EMAIL

James W. Remillard                                       

Director

Missouri Department of Public Safety           

State Emergency Management Agency         

2302 Militia Drive                                          

P.O. Box 116                                                  

Jefferson City, Missouri 65102

 

John Barclay

Chief of EMS

Reverend Noel T. Adams Ambulance District

1000 S. 25th Street

Bethany, Missouri 64424


 

 

Re:  Second Appeal - Reverend Noel T. Adams Ambulance, PA ID 081-09DE2-00, 

        FEMA-4490-DR-MO, Grants Manager Project 662637/Project Worksheet 505, Force Account Labor & Equipment Costs

 

Dear James W. Remillard and John Barclay:

This is in response to a letter from the Missouri State Emergency Management Agency dated March 11, 2024, which transmitted the referenced second appeal on behalf of the Reverend Noel T. Adams Ambulance District (Applicant). The Applicant is appealing the U.S. Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) calculation of the fair market value (FMV) of its ambulance and its reduction of funding based on that amount. 

As explained in the enclosed analysis, I have determined the Applicant has not demonstrated that it used its ambulance for eligible medical transports related to COVID-19 beyond the four-month time frame used by FEMA to calculate the FMV of the ambulance. Thus, the appeal is denied. 

This determination is the final decision on this matter pursuant to 44 C.F.R. § 206.206, Appeals.

 

                                                                                                    Sincerely, 

                                                                                                          /S/

                                                                                                    Robert Pesapane

                                                                                                    Division Director

                                                                                                    Public Assistance Division

 

Enclosure

cc: Andrea Spillars

     Regional Administrator

     FEMA Region 7  

Appeal Analysis

Background

The coronavirus (COVID-19) pandemic resulted in a major disaster declaration for the state of Missouri on March 26, 2020, with an incident period from January 20, 2020, to May 11, 2023. The Reverend Noel T. Adams Ambulance District (Applicant), a special district government, requested Public Assistance (PA) for contract costs to build a new ambulance for transporting COVID-19 patients by remounting part of its existing ambulance to a newly purchased truck chassis. FEMA prepared Grants Manager Project 662637 to reimburse the Applicant’s costs for the refurbished ambulance in the amount of $183,684.00. On November 4, 2022, the Missouri State Emergency Management Agency (Recipient) certified to FEMA that the project was completed and provided closeout documentation from the Applicant.[1] The closeout documentation included a letter from a Certified Public Accountants (CPA) firm that identified $18,300.00 as the amount of depreciation for the ambulance, using a “straight-line depreciation over a ten-year life,” based on one year of use.[2] The Applicant provided a narrative with the closeout documents, stating that it used the ambulance to transport COVID-19 patients from January 15, 2022, to April 9, 2022, and explaining that: “April 9, 2022, was used as an end date as Governor Mike Parson declared an end to the pandemic on April 1, 2022, and we stopped tracking our COVID-19 transports.”[3] Neither the CPA letter nor the Applicant-provided narrative identified the fair market value (FMV) of the ambulance.   

In a Determination Memorandum received by the Applicant on August 14, 2023, FEMA outlined disposition requirements for the project, including the requirement that the Applicant must provide the FMV for any items that have a current FMV of $5,000.00 or more. FEMA stated that, because the Applicant did not provide mileage logs or the FMV of the refurbished ambulance, it determined the FMV of the ambulance to be $174,499.80 based on the original build cost of $183,684.00 and the Applicant’s use of the ambulance for eligible work during the four-month period of January through April, 2022, as stated in the Applicant’s closeout documentation. FEMA deobligated this FMV amount from the previously awarded funding of $183,684.00, resulting in a final eligible cost of $9,184.20. 

First Appeal 

On October 3, 2023, the Applicant submitted a first appeal, disagreeing with FEMA’s use of four months for the calculation of depreciation for the ambulance. The Applicant denied that it provided the $18,300.00 depreciation value contained in the CPA letter and claimed that it was never asked to provide the mileage or condition of the vehicle or the FMV. The Applicant stated that it placed the ambulance into service at the end of December 2021, used it to respond to COVID-19 patients until the public health emergency ended on May 11, 2023, and is still using it to respond to COVID-19 calls during the endemic phase. The Applicant requested that the project amount of $183,684.00 be reinstated with corrected dates for its use of the ambulance and indicated it would work with FEMA to determine an FMV. In a letter dated October 13, 2023, the Recipient forwarded the Applicant’s appeal, recommending that FEMA’s eligibility determination be sustained. 

In a letter signed January 9, 2024, the FEMA Region 7 Regional Administrator denied the first appeal, finding that the Applicant did not provide documentation to support the ambulance was used for eligible medical transports related to COVID-19 past April 9, 2022. FEMA stated that, in the project development and closeout documentation, the Applicant made it clear that it used the ambulance to transport COVID-19 patients from January 15, 2022, to April 9, 2022, and that it stopped tracking COVID-19 transports after April 9, 2022, when the Missouri Governor declared an end to the pandemic for the state. FEMA stated that it correctly calculated the FMV of the ambulance, based on the four-month period that the Applicant documented its use for eligible work, and correctly deducted the FMV from the obligated amount of $183,684.00. 

Second Appeal

On March 5, 2024, the Applicant submitted a second appeal. The Applicant disagrees with the four-month timeframe used by FEMA to determine the depreciation costs. The Applicant contends the depreciation of the ambulance should be based on 17 months (January 2022 through May 2023), which is when the Applicant claims it used the ambulance during the federally declared disaster and public health emergency. The Applicant provides call logs, which show the use of the ambulance from April 14, 2022, to May 11, 2023, and requests that funding be reinstated with the corrected dates for the use of the ambulance. In a letter dated March 11, 2024, the Recipient forwarded the Applicant’s appeal, recommending that FEMA uphold its prior determination.

 

Discussion

FEMA is authorized to provide assistance for emergency protective measures to save lives and protect public health and safety.[4] Eligible work includes emergency medical transport related to COVID-19.[5] There are certain disposition requirements when equipment is no longer needed for response to or recovery from the incident.[6] In response to COVID-19, tribal, local government, and private nonprofit applicants: (1) may use the items for other federally funded programs or projects, provided the Applicant informs FEMA in writing; or (2) must calculate the current FMV of each individual item of equipment and provide the current FMV to FEMA for any items that have a current FMV of $5,000.00 or more, after which FEMA reduces eligible funding by this amount.[7] To calculate depreciation or FMV, the date used to determine when equipment is no longer needed is based on the work completion deadline of May 11, 2023, or information previously provided by an applicant.[8] It is the applicant’s responsibility to provide documentation to substantiate its claim as eligible and to clearly explain how those records support its appeal.[9]

The depreciation or FMV calculation is based on the date when the equipment is no longer needed for response to or recovery from the incident.[10] Consistent with the above cited policy, FEMA originally determined this date based on information previously provided by the Applicant, which documented that it used the ambulance for COVID-19 medical transports from January 15, 2022, to April 9, 2022, and it stopped tracking COVID-19 transports after April 9, 2022. In response, the Applicant provides call logs on second appeal showing additional use of the ambulance to transport patients until May 11, 2023. However, while the call logs generally describe each patient’s symptoms (e.g., acute respiratory distress, fever, chest pain and discomfort, smoke inhalation, generalized weakness), there is no information that identifies whether the patient had or was suspected of having COVID-19.[11] Therefore, FEMA correctly calculated the FMV for the ambulance based on the information previously provided by the Applicant, which demonstrates that it used the equipment for COVID-19 medical transports until April 9, 2022.   

 

Conclusion

The Applicant has not demonstrated that it used its ambulance for eligible medical transports related to COVID-19 beyond the four-month timeframe used by FEMA to calculate the FMV of the ambulance. Therefore, the appeal is denied. 


 

[1] See Letter from Manager, Recovery Division, Missouri State Emergency Management Agency (SEMA), to Director, Recovery Division, FEMA Region 7 (Nov. 4, 2022). In the letter’s attachments, SEMA provided various documents, including the Project Completion and Certification Report (P.4), which the Applicant signed on July 6, 2022, certifying that the project was complete. Id. at 5. 

[2] Id. at 6. The undated letter from Harden Cummins Moss & Miller, LLC, included as part of the SEMA closeout documentation, is entitled “NTA Ambulance District,” and is addressed “To Whom it May Concern.”    

[3] Id. at 18. 

 

[4] Robert T. Stafford Disaster Relief and Emergency Assistance (Stafford) Act § 403(a)(3), Title 42, United States Code § 5170b(a)(3) (2018); Title 44 of the Code of Federal Regulations (44 C.F.R.) § 206.225(a) (2019). 

[5] FEMA Policy 104-21-0004, Coronavirus (COVID-19) Pandemic: Medical Care Eligible for Public Assistance (Interim) (Version 2), at 4 (Mar. 15, 2021). 

[6] SeeCOVID-19 Pandemic: Public Assistance Disposition Requirements for Equipment and Supplies Frequently Asked Questions Version 2, at 2 (May 5, 2023) [hereinafter Disposition Requirements for Equipment and Supplies FAQs]; Public Assistance Program and Policy Guide, FP 104-009-2, at 29 (Apr. 1, 2018) [hereinafter PAPPG]. Equipment is defined as any tangible personal property having a useful life of more than one year and a per-unit acquisition cost that equals or exceeds the lesser of the capitalization level established by the applicant for financial statement purposes, or $5,000, whichever is less. Disposition Requirements for Equipment and Supplies FAQs, at 3; PAPPG, at 29.

[7] Disposition Requirements for Equipment and Supplies FAQs, at 2. See generally PAPPG, at 29 (noting FMV is either the selling price or the advertised price for a similar item in a competitive market). 

[8] Disposition Requirements for Equipment and Supplies FAQs, at 4. 

[9] See 44 C.F.R. § 206.206(a); PAPPG, at 133; FEMA Second Appeal Analysis, City of Atlanta, FEMA-4501-DR-GA, at 4 (Apr. 26, 2024).

[10] The Applicant has not claimed that it used the ambulance for other federally funded programs or projects.

[11] See Letter from Chief of EMS, Rev. Noel T. Adams Memorial Ambulance District, to Director, SEMA, at Attach. A (Mar. 5, 2024). 

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