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Pipe Insulation Replacement

Appeal Brief

Disaster1909-DR-TN
ApplicantNashville-Davidson County
Appeal Type2nd
PA ID#037-52004-00
PW ID#5522
Date Signed

Conclusion:  The Applicant provided sufficient documentation to support the need for replacement of pipe insulation due to mold contamination.

Summary Paragraph

During the incident period of April 30 to May 18, 2010, severe storms and flooding caused the Cumberland River to overflow, submerging the Applicant’s K. R. Water Treatment Plant.  The Plant’s Filter/Chemical Building was inundated and its below-grade rooms flooded.  FEMA prepared PW 5522 in the amount of $3,128,178.01 for repairs to the building.  FEMA initially determined that the costs of the replacement of the pipe insulation due to mold contamination were ineligible because either the repairs were needed due to deferred maintenance or the contamination could not be verified.  The Applicant submitted a first appeal in the amount of $3,047,519.38 for several items, including $141,577.00 for the replacement of the pipe insulation.  The Regional Administrator (RA) found that there was limited contamination and not enough to merit full pipe insulation replacement; that the Applicant’s technical memorandum did not specify the precise facility location or dimensions of the tested pipes; and their unit linear costs.  Finally, the RA stated that the Applicant did not refute the original determination of deferred maintenance.  On second appeal, the Applicant argued that the damage was disaster-related, that it was necessary to replace the pipe insulation, and claimed that maintenance was not deferred.  The Applicant provided a survey report supporting the claim of adequate maintenance. 

Authorities and Second Appeals

  • 44 C.F.R. § 206.223(a)(1)
  • Recovery Division Fact Sheet 9580.100, Mold Remediation at 4 (Nov. 7, 2006)
  • PA Guide, at 32
  • City of Port Arthur, FEMA-1606-DR-TX, at 3.

Headnotes

  • 44 C.F.R. § 206.223(a)(1) provides that to be eligible for reimbursement, an item of work must “[b]e required as the result of the emergency or major disaster event.”
    • The pipe insulation was in an area that was completely submerged with floodwaters resulting from the disaster.
  • Recovery Division Fact Sheet 9580.100, Mold Remediation provides that “It is the responsibility of the applicant to show evidence of mold contamination or damage during the inspection.”
    • The Applicant conducted testing; 45 percent of the samples contained mold at that time. 
  • The PA Guide at 32 states that for “mold remediation to be eligible, the mold must not be a result of poor facility maintenance or failure to take protective measures in a reasonable time after the event.”
  • The Applicant took prompt action to drain and dry the plant immediately following the flood waters receding.
    • The Applicant provided a 2009 survey report to demonstrate proper maintenance.
  • City of Port Arthur, FEMA-1606-DR-TX, at 3, states that under FEMA’s mold remediation policy, “soft surfaces such as ceiling tiles, cellulose and fiberglass insulation, and wallboards should be replaced after being contaminated with mold.”
    • The Applicant’s paper-backed pipe insulation should be considered a soft surface.

 

 

Appeal Letter

September 4, 2014

David PurkeyInterim DirectorTennessee Emergency Management Agency3041 Sidco Drive, P.O. Box 41502Nashville, TN 37204-1502

Re:  Second Appeal – Nashville-Davidson County, PA ID 037-52004-00, FEMA-1909-DR-TN, Project Worksheet (PW) 5522 – Pipe Insulation Replacement – Mold Contamination

Dear Mr. Purkey:

This is in response to your letter dated February 20, 2014, which transmitted the referenced second appeal on behalf of Nashville-Davidson County (Applicant).  The Applicant is appealing the U.S. Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of $141,577.00 for the replacement of mold contaminated pipe insulation.

As explained in the enclosed analysis, I have determined that the Applicant has demonstrated that the damage to the pipe insulation was caused by the flooding, that there was adequate maintenance, and that the pipe insulation replacement was necessary.  Accordingly, I am granting the appeal.  By copy of this letter, I am requesting the Acting Regional Administrator take appropriate action to implement this determination.

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/

William W. RocheDirectorPublic Assistance Division                                         

Enclosure

cc: Andrew Velasquez, III     Regional Administrator     FEMA Region IV

Appeal Analysis

Background

During the incident period of April 30, 2010, to May 18, 2010, severe storms and flooding caused the Cumberland River to overflow.  The Nashville-Davidson County’s (Applicant) K.R. Harrington Water Treatment Plant was submerged.  The Filter/Chemical Building System of the water treatment plant was inundated and the below-grade rooms flooded.  The Applicant’s equipment, which had pipes with paper-backed piping insulation, was submerged.  The Applicant contracted to pump out, clean, and dry the facility immediately after the floodwaters receded.  On October 29, 2010, the Applicant had a bacteria and mold assessment conducted, which confirmed the presence of mold.  FEMA obligated Project Worksheet (PW) 5522 to address restoration of the Filter Building System for $3,128,178.01 on March 13, 2011.  The cost of the pipe insulation replacement was not obligated because the Applicant did not verify the contamination at the time and the damage was thought to be the result of deferred maintenance.

First Appeal

In a letter submitted June 1, 2011, the Applicant appealed a total of $3,047,519.38 in denied funding for direct administrative costs, resident engineering, mold on pipe insulation, metal door replacement, repairs to damaged flumes, repairs to damaged electrical wiring and cable, replacement of lime feed and fluoride feed equipment, replacement of a distributive control unit, replacement of butterfly valves in filter building clearwells, rebuilding pumps, and replacement of air compressors.  On December 6, 2013, the FEMA Region IV Regional Administrator (RA) issued a partial approval for $1,853,767.32, subject to insurance review and anticipated insurance proceeds.  The rest of the costs, including the replacement of the pipe insulation, were denied because, while the work may have been eligible, the documentation provided was not sufficient to prove that the damages were disaster-related. 

In FEMA’s first appeal response, the RA stated that the technical memorandum and report provided by the Applicant showed only limited mold contamination, findings which did not merit complete replacement. The RA also stated that the reports did not identify the facility location or dimensions of the tested pipes, and did not provide a unit cost per linear foot for pipe insulation removal and replacement.  Finally, the Applicant did not refute FEMA’s finding that the insulation damage resulted from deferred maintenance.  Therefore, the RA found that the Applicant provided insufficient documentation to show that the degradation of pipe insulation resulted from the flooding.  However, the Applicant used the same technical memorandum in six other appeals with this issue, and relief was granted in all of them.[1]

Second Appeal

On February 12, 2014, the Applicant submitted a second appeal letter to the State of Tennessee (Grantee).  The Grantee transmitted the Applicant’s second appeal to FEMA Region IV in a letter dated February 20, 2014, supporting the appeal.  The Grantee argues that the documentation submitted with the second appeal should be sufficient to allow reimbursement for the pipe insulation.  The Applicant limited its second appeal to the removal of the pipe insulation for $9,577.00 and the replacement of the pipe insulation for $132,000.00, totaling $141,577.00.

Discussion

Need for Removal and Replacement of Pipe Insulation

According to 44 C.F.R. § 206.223(a)(1), in order to be eligible, work must be required as the result of the disaster. The floodwaters reached two feet above grade on the outside building walls and completely submerged the interior, below-grade rooms for two to three days.[2]  On October 29, 2010, the Applicant had a bacteria and mold assessment conducted, which confirmed the presence of mold.  In a letter dated May 18, 2011, the Applicant’s consultant explained that their observation and assessment of the impacted facility led them to the conclusion that the insulation was damaged by a major water intrusion event and that all of insulation in the flood zone was impacted.  FEMA’s Fact Sheet on mold remediation incorporates guidance from the Environmental Protection Agency stating that fiberglass and cellulose insulation should be replaced following mold contamination.[3]  It does not reference a threshold for contamination remediation eligibility; rather it only instructs that water damaged fiberglass and cellulose installation should be discarded and replaced.   

Dimensions, Locations, and Cost

FEMA’s Public Assistance (PA) Guide provides that in a PW scope of work, “work should be specified as an action with quantifiable (length, width, depth, capacity) and descriptive (brick, wood, asphalt, timber deck bridge) terms.”[4]  The RA found that the technical memorandum and report provided by the Applicant did not identify which pipes were tested, their location in the facility, or the pipe dimensions.  On second appeal, the Applicant provided the locations and dimensions of the pipes in question, which correlate to PW line items numbered 3, 4, 9-14, and 16-19 from the PW’s damage description and scope of work.[5]  While the Applicant did not provide a unit cost per linear foot for pipe insulation removal and replacement, FEMA calculated the cost per linear foot by adding the totals requested for removal and replacement and dividing by the total linear feet of pipe insulation.  The resulting cost per linear foot was reasonable and comparable to the cost allowed on first appeal for the same applicant on PWs 5533, 5585, 5596, 5591, 5595, and 5597. 

Maintenance

The PA Guide states that for mold remediation to be eligible, “the mold must not be the result of poor facility maintenance or failure to take protective measures in a reasonable time after the event.”[6]  That the Applicant acted appropriately by hiring a contractor to pump out, clean, and dry the facility as soon as the floodwaters receded is not in dispute.  However, on first appeal, the RA found that the Applicant did not refute FEMA’s initial finding that the insulation damage resulted from deferred maintenance. 

In its second appeal submission, the Applicant states that the State of Tennessee’s Department of Environment and Conservation conducts routine sanitary surveys under its Drinking Water Program to ensure that water treatment facilities are compliant with the Safe Drinking Water Act.  The State’s 2009 survey did not make note of or deduct from the survey for any indication of the presence of mold.  In response to a specific request from FEMA, the Applicant provided a copy of the survey conducted on February 11-13 and 17, 2009.  The survey provided some recommendations but stated that “all other operations of the water system were of a superior nature.”  None of the recommendations applied to maintenance of the pipe insulation.  Furthermore, the survey included specific categories of equipment and associated scoring regarding maintenance.  Specifically, line items “4L.  Maintenance of Equipment, Buildings and (1) Grounds 1200-5-1-.02, .17(3), (17); and (19)”; “6B.  Inspection and Maintenance of Reservoirs, Tanks and Clearwell 1200-5-1-.17(16), (17), (33) and (34)”; and “7B.  Maintenance of Pumping Equipment 1200-5- (1-3) 1-.17(13)” were marked as “OK”, indicative of good maintenance practices.  These survey results sufficiently demonstrate that the pipes were properly maintained prior to the incident and that the damage was caused by the disaster.

Conclusion

The Applicant has provided documentation which identifies where the pipes were located, pipe dimensions, and unit costs for the insulation replacement.  The Applicant has also provided sufficient documentation to demonstrate that the insulation damage was a result of the flood event.  Therefore, the replacement of the mold contaminated pipe insulation is eligible.  A version to PW 5522 will be written to reflect this eligibility, subject to insurance review and anticipated insurance proceeds. 

[1] See first appeal responses for Nashville-Davidson County, PWs 5533 (Sept. 27, 2013); 5585 (Sept. 27, 2013); 5591 (Nov. 25, 2013); 5595 (Dec. 6, 2013); 5596 (Sept. 27, 2013); and 5597 (Nov. 25, 2013).

[2] Project Worksheet 5522, Nashville-Davidson County, Version 0 (Sept. 15, 2010).

[3] See Recovery Division Fact Sheet 9580.100, Mold Remediation at 4 (Nov. 7, 2006); see also FEMA Second Appeal Analysis, City of Port Arthur, FEMA-1606-DR-TX, (October 14, 2008) at 3.

[4] Public Assistance Guide, FEMA 322 at 101 (June 2007) (hereinafter PA Guide].

[5] PW 5522, Nashville-Davidson County, Version 0.

[6] PA Guide, at 32.

 

Last updated May 28, 2020

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