Legal Responsibility

Appeal Brief

Appeal Letter

Appeal Analysis

Background

Hurricane María caused significant damage throughout Puerto Rico from September 17 through November 15, 2017.^[1]The Municipality of Ponce (Applicant) sought Public Assistance funding for permanent repairs for several buildings and contents (Facilities) in the Port of Ponce (Port). FEMA developed Grants Manager Project (GMPs) 117938, 133360, 73114, and 79549 for the Applicant to capture the claimed damages at the Facilities and its repair costs. Relevant to this appeal, on September 13, 2023, the Government of Puerto Rico Central Office for Recovery, Reconstruction, and Resiliency (Recipient) requested, on behalf of the Ponce Port Authority (PPA), that FEMA transfer the damage inventories from GMPs 117938, 133360, 73114, and 79549 from the Applicant to the PPA. To support its request, the Recipient provided a Memorandum of Understanding (MOU), dated September 1, 2023, stating that under a local law the Applicant was required to transfer all its real estate properties at the Port to the PPA; and a letter from the PPA, dated September 7, 2023, that confirmed acceptance of the transfer of the projects from the Applicant. On December 7, 2023, FEMA denied the request, finding that the PPA was not legally responsible for the Facilities repairs at the time of the disaster.

First Appeal

On February 5, 2024, the PPA appealed, citing local laws, and providing MOUs to support its claim that it was legally responsible for the Facilities.[2] The PPA stated that, on December 12, 2011, Local Law 240 (LL 240) created the PPAto administer and maintain the Port and directed the transfer of the Port assets to the PPA within 10 years. The PPA stated that, in compliance with LL 240, it had taken steps during the prior 18-24 months for the transfer of the title of the Facilities to the PPA. The PPA also claimed that MOUs signed between the PPA, and the owner of the Facilities made the PPA legally responsible to represent, request, pursue, obtain, and manage federal assistance funds for all properties in the process of being transferred to the PPA, including the Facilities at issue.[3] Finally, the PPA claimed that the fact it could be held liable for any incident in the Facilities indicated that it was legally responsible for the Facilities. In a letter dated April 4, 2024, the Recipient forwarded the appeal to FEMA with its support. 

On October 21, 2024, the FEMA Region 2 Regional Administrator denied the appeal. Relevant to this appeal, FEMA stated that the PPA had not shown that it was legally responsible to repair the Facilities at the time of the declared disaster. FEMA found that the Applicant could not use post-disaster MOUs to transfer legal responsibility for repairs of the Facilities to the PPA.

Second Appeal

The PPA submitted its second appeal in a letter dated December 20, 2024.[4] The PPA reiterates its previous arguments in support of its legal authority to repair the Facilities, citing LL 240, prior MOUs, and certifications of property transfers included in the second appeal. The PPA references three previous FEMA second appeal decisions, asserting that FEMA assesses ownership and legal responsibility based on the terms of written agreements, such as deeds, title documents, and local government tax records.[5] For example, the PPA indicates that in one second appeal decision, FEMA found the Applicant was legally responsible for disaster-related repairs after reviewing all the documentation, when no official ownership record was available and no other responsible party was identified.[6] The PPA also states that in a different second appeal from the same applicant, FEMA found an applicant had demonstrated legal responsibility to make disaster-related repairs through documented efforts in maintaining, improving, conserving, and restoring a historic property.[7] The PPA asserts that these previous FEMA appeal decisions support its claim of legal responsibility for the Facilities’ maintenance and repairs as outlined in the written agreements provided. Furthermore, the PPA notes that in compliance with LL 240, it completed the ownership transfer process for certain properties in June of 2024, emphasizing the law’s intent for the PPA to be viewed as the owner of all the properties that comprise the Port, including the Facility. The Recipient forwarded the appeal to FEMA with its support in a letter dated February 18, 2025.  

Discussion

FEMA may provide funding to a local government for the repair of a public facility damaged by a major disaster.^[8] To be eligible for funding, work must be the legal responsibility of the applicant requesting assistance.[9] To determine legal responsibility for permanent work, FEMA evaluates whether the applicant claiming the costs had legal responsibility for disaster-related restoration of the facility at the time of the incident based on ownership and the terms of any written agreements.^[10] To determine ownership, FEMA may review deeds, title documents, and local government tax records.^[11] 

Here, the PPA claims it was legally responsible for the Facilities at the time of the disaster, based on LL 240, MOUs, and property transfer certifications. Although LL 240 laid the groundwork for transferring the Facilities to the PPA, this process was not completed at the time of the disaster, and as a result, the PPA did not own the Facilities. 

Since legal responsibility was not established based on ownership of the Facilities, FEMA considers whether there are any written agreements establishing the Applicant’s legal responsibility for repairs to the Facilities at the time of the disaster. The PPA provided FEMA with multiple MOUs, claiming that they demonstrate the PPA’s responsibility to repair the event-related damages. However, the MOUs were executed between early 2022 and late 2023, approximately four to six years after the disaster, and did not recognize the PPA’s responsibility to repair the disaster-related damages.  

Similarly, the PPA submits various certifications of property transfers corresponding to locations of the Facilities; however, these certificates were issued in June 2024, nearly seven years after the disaster. Moreover, even if the certificates had been issued before the disaster, they would still fail to establish PPA’s legal responsibility for repairs, since they indicate that the Facilities were owned by the Government of Puerto Rico and registered under another governmental entity in the Property Registry at the time of the disaster rather than the PPA. 

Finally, the PPA argues that FEMA precedent has established that an applicant’s ongoing efforts to maintain, improve, conserve, and restore a historic property sufficiently demonstrate legal responsibility. The PPA cites, Asociación Frailes Capuchinos, Inc., as support for its claim that it is legally responsible for maintaining and repairing the Facilities based on their use. However, the facts in this appeal differ from those in Asociación Frailes Capuchinos, Inc. In that case, the applicant had continuously occupied the facility for 70 years since its construction, there were no known prior legal owners registered with the government, and no other legal owners had emerged since the applicant took possession.^[12] In addition, there was no documentation to suggest that another entity owned or was responsible for the facility. In contrast, in this case, ownership of the Facility at the time of the disaster is undisputed. While steps had been taken to transfer ownership of the Facilities to the PPA, at the time of the disaster, an entity other than the PPA was the legal owner of the Facilities. 

Based on the PPA’s submitted documentation, the PPA did not own the Facilities at the time of the disaster and did not demonstrate through the terms of any written agreements that it was legally responsible for the requested repairs at the time of the disaster.^[13]

Conclusion

The PPA did not have legal responsibility for the requested repairs at the time of the disaster. Therefore, this appeal is denied.