Time Limitations/Extensions – Direct Administrative Costs & Management Costs

Appeal Brief Appeal Letter Appeal Analysis

Appeal Brief

Disaster4332
ApplicantTexas Department of State Health Services
Appeal TypeSecond
PA ID#000-U0109-00
PW ID#PW 6115
Date Signed2021-12-01T17:00:00

Summary Paragraph

On August 23, 2017, Hurricane Harvey impacted multiple counties in Texas.  The Texas Department of State Health Services (Applicant) elected to participate in FEMA’s Public Assistance Alternative Procedures for Direct Administrative Costs (PAAP DAC) pilot program and signed Appendix A.  FEMA approved Project Worksheet (PW) 6115, a Category Z project, to reimburse DAC.  The Applicant requested a time extension for submitting its proposal to use excess PAAP DAC funds associated with PW 6115 to the Texas Division of Emergency Management (Grantee) on August 22, 2019.  In follow up communication, the Applicant stated the time extension was necessary because extenuating circumstances (i.e., wildfires and a mass shooting) prevented it from meeting the August 25, 2019 deadline to submit its proposal.  In a letter dated January 15, 2021, FEMA denied the Applicant’s time extension request.  FEMA noted the Applicant’s justification for the delays only covered a period of fewer than three weeks, which did not provide sufficient justification for delays.  The Applicant submitted its first appeal in a letter dated March 24, 2021, and argued that additional extenuating circumstances beyond its control (i.e., other disasters that occurred after August 2019, including responding to the coronavirus) demanded the Applicant’s ongoing response efforts and justified the extension.  The FEMA Region VI Regional Administrator denied the first appeal, stating that time extension denials for alternative procedures projects are not appealable actions under FEMA policy.  The Applicant reiterates its prior arguments on second appeal and asserts that FEMA previously provided guidance after it issued the initial time extension denial and through language included in the first appeal response, that the time extension denial was in fact appealable.  The Grantee transmitted the second appeal along with a letter of support. 

Authorities and Second Appeals

  • Stafford Act § 428(c)(3)-(4), (e)(1)(B)(ii).
  • PAPPG, at 145-146 (Apr. 1, 2018).
  • PAAP for DAC, Version 1.1, at 2, 7.

Headnotes

  • The PAPPG, at 145-146, states that for alternative procedures projects, the applicant may submit an appeal only for insurance or corrective actions resulting from reviews such as an audit. 
    • FEMA’s denial of the Applicant’s request to extend the deadline to submit an excess funds PAAP DAC proposal does not fall within the appealable actions outlined in FEMA policy.  Additionally, the Applicant signed an Agreement for Participation, which included a stipulation that appeal rights pertained to deobligations resulting from specifically delineated determinations.  Therefore, the time extension denial at issue is not appealable.

Conclusion

FEMA finds that the Applicant did not have an agreed-upon proposal for the use of PAAP DAC excess funds within 180 days of the latest period of performance.  Furthermore, the denial of a request to extend the deadline to submit a proposal to use excess PAAP DAC funds is not an appealable action under FEMA policy.  Therefore, this appeal is denied. 

Appeal Letter

W. Nim Kidd, MPA

Chief, Texas Division of Emergency Management

Vice Chancellor – The Texas A&M University System

1033 La Posada Drive, Suite 300

Austin, TX  78752

 

Re:  Second Appeal – Texas Department of State Health Services, PA ID: 000-U0109-00, FEMA-4332-DR-TX, Project Worksheet (PW) 6115, Time Limitations/Extensions – Direct Administrative Costs & Management Costs

 

Dear Chief Kidd:

This is in response to a letter from your office dated September 2, 2021, which transmitted the referenced second appeal on behalf of Texas Department of State Health Services (Applicant).  The Applicant is appealing the U.S. Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of a request to extend the deadline to submit its proposal to use excess Public Assistance Alternative Procedures for Direct Administrative Costs (PAAP DAC) funds.  

As explained in the enclosed analysis, I have determined that the Applicant did not have an agreed-upon proposal for the use of PAAP DAC excess funds within 180 days of the latest period of performance.  Furthermore, the denial of a request to extend the deadline to submit a proposal to use excess PAAP DAC funds is not an appealable action under FEMA policy.  Therefore, this appeal is denied. 

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/

                                                                     Ana Montero

                                                                    Division Director

                                                                    Public Assistance Division

Enclosure

cc:  George A. Robinson

Regional Administrator

FEMA Region VI

Appeal Analysis

Background

On August 23, 2017, Hurricane Harvey impacted multiple counties in Texas.  On April 6, 2018, the Texas Department of State Health Services (Applicant) elected to take part in FEMA’s Public Assistance Alternative Procedures for Direct Administrative Costs (PAAP DAC) pilot program and signed Appendix A: Agreement for Participation.[1]  On June 21, 2019, FEMA approved Project Worksheet (PW) 6115, a Category Z project, for $1,759,864.53 in consolidated, fixed estimate DAC (5 percent of the Applicant’s eligible emergency and permanent work projects, prior to reductions), pursuant to the PAAP DAC policy.[2]

In a letter to the Texas Division of Emergency Management (Grantee) dated August 26, 2019, the Applicant requested a six-month time extension for submitting its proposal to use $1,759,864.53, the full amount of DAC awarded for PW 6115, as excess PAAP DAC funds.  In follow up communication, the Applicant stated the time extension was necessary because extenuating circumstances prevented it from meeting the August 25, 2019 deadline to submit its proposal.[3]  On October 15, 2019, the Grantee forwarded the Applicant’s request, supporting its request for an extension.  In a letter dated January 15, 2021, FEMA denied the Applicant’s request.  FEMA noted the Applicant’s justification for the delays covered a period of fewer than three weeks, which did not provide sufficient justification for delays beyond the August 25, 2019 deadline to submit a request for use of excess funds.

First Appeal

The Applicant submitted its first appeal in a letter dated March 24, 2021.  The Applicant stated it was working in July 2019 to complete a proposal for the use of excess PAAP DAC funds. However, the Applicant explained that in August 2019 its primary focus shifted to response and recovery efforts associated with wildfires and a mass shooting.  Further, the Applicant stated that other disasters that occurred after August 2019 demanded the Applicant’s ongoing response efforts, including responding to COVID-19.  Therefore, the Applicant requested that FEMA extend the deadline to submit the proposal for the use of excess PAAP DAC to August 31, 2021.  The Grantee transmitted the first appeal along with a letter of support on April 21, 2021. 

The FEMA Region VI Regional Administrator issued the first appeal decision on June 4, 2021, stating that time extension denials for alternative procedures’ projects are not appealable actions under FEMA policy. 

Second Appeal

Through an August 1, 2021 second appeal letter, the Applicant reiterates its prior arguments.  In addition, the Applicant disputes FEMA’s determination that its time extension request is not an appealable action.  First, it states that it received guidance from FEMA and the Grantee that it could appeal the original determination denying the extension request, pointing to language in the first appeal response that indicated the Applicant could appeal the determination.  Second, the Applicant disputes FEMA’s reliance on sections from the PAAP Guide for Permanent Work because its project involves DAC rather than permanent work.  The Applicant states it is unreasonable not to allow an applicant to appeal a decision that is in error.  The Grantee transmitted the second appeal along with a letter of support on September 2, 2021. 

Discussion

Section 428 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act authorizes FEMA to provide funding for management costs to applicants based on an estimate, if the applicant elects to participate in the alternative procedure program.[4]  FEMA’s PAAP DAC policy permits excess DAC funds to be used for any costs otherwise eligible, if the applicant identifies the excess funds and submits the request to use the funds within 180 days of the latest project period of performance.[5]  FEMA policy on appeals states that for alternative procedures’ projects, the applicant may submit an appeal only for insurance or corrective actions resulting from reviews such as an audit.[6]  

FEMA policy makes it clear that an applicant must submit its proposal for the use of PAAP DAC excess funds within 180 days of the latest period of performance and that appeal rights for alternative procedures’ projects only apply to the limited actions (e.g., corrective actions) described above.  Here, the Applicant signed the PAAP DAC Agreement for Participation, which includes conditions on the use of excess funds and stipulates appeal rights in the context of deobligations resulting from specifically delineated determinations.[7]  The Applicant in this case is not appealing any of the aforementioned actions; it is appealing FEMA’s denial of the Applicant’s request to extend the deadline to submit an excess funds PAAP DAC proposal.  Therefore, FEMA finds that, regardless of any prior communication to the contrary, the underlying time extension denial is not appealable.[8]    

 

Conclusion

The Applicant did not have an agreed-upon proposal for the use of PAAP DAC excess funds within 180 days of the latest period of performance.  Furthermore, the denial of a request to extend the deadline to submit a proposal to use excess PAAP DAC funds is not an appealable action under FEMA policy.  Therefore, this appeal is denied. 

 

 

[1] Appendix A is the Agreement for Participation in the PAAP DAC pilot, signed by FEMA, Texas Division of Emergency Management (Grantee), and Texas Department of State Health Services (Applicant). 

[2] Public Assistance Alternative Procedures for Direct Administrative Costs, Version 1.1, (June 12, 2018).

[3] The Applicant cited three events in August 2019 as extenuating circumstances causing the delay in submitting its excess funds PAAP DAC proposal: a mass shooting in El Paso, and two wildfires in Copper Breaks, Texas.

 

[4] Robert T. Stafford Disaster Relief and Emergency Assistance (Stafford) Act § 428(e)(1)(B)(ii), Title 42, United States Code (42 U.S.C.)  § 5189f(e)(1)(B)(ii) (Supp. I 2013).

[5] Public Assistance Alternative Procedures for Direct Administrative Costs, Version 1.1, at 7.

[6] Public Assistance Program and Policy Guide, FP 104-009-02, at 145-146 (Apr. 1, 2018).

[7] Appendix A: Agreement for Participation, executed by FEMA and the Grantee on January 1, 2018, and signed by the Applicant on April 6, 2018.

[8] See generally, FEMA Second Appeal Analysis, Florida Divison of Emergency Management, FEMA-3395-EM-FL, at 2 (Sept. 21, 2021) (making it clear that FEMA does not accept PAAP DAC excess funds proposals beyond the 180-day deadline).

Last updated December 6, 2021