Direct Result of the Disaster, Predisaster Conditions, Codes and Standards

Appeal Brief

Appeal Letter

Appeal Analysis

Background

From October 26 to November 8, 2012, Hurricane Sandy caused extensive damage to Veteran’s Memorial Waterfront Park (Facility) in the City of Elizabeth, New Jersey (Applicant).  The Facility sits on a 1.3 mile stretch of waterfront land bordering the Arthur Kill Waterway, and includes amenities such as a recreational park area with a flag memorial, a fishing pier, a municipal marina, a boardwalk, chess tables, and a hike and bike area.[1]  FEMA prepared Project Worksheet (PW) 3772 for $16,243,804.50 in costs for the repair and restoration of five separate areas in the Facility.  The work performed in the Facility’s “formal park area” (Area 1) totaled $9,744,980.00 in costs and covered repairs of damage to flagpoles, a monument, decorative walls, benches, fencing, decking, lighting fixtures, trash cans, drinking fountains, concrete pavers, and a sprinkler system.[2]

In December 2013, the Applicant’s contractor noticed signs of soil contamination in Area 1 while completing flagpole repairs.  The contractor reported oil-stained soil, a petroleum odor emanating from the soil, and an oily sheen floating on a pool of groundwater at the worksite.  This prompted the Applicant to contact its environmental consultant, T&M Associates (T&M), to request an evaluation of the Facility by a Licensed Site Remediation Professional (LSRP).[3]  During the initial site inspection, the LSRP detected a petroleum odor and the presence of historic fill material in the excavated soil.^[4]  After an assessment of the site and analysis of the site’s soil samples on March 13, 2014, the LSRP confirmed the presence of soil contamination discharged from sources such as historic fill material and previous industrial operations on the site dating back to the 1880s.[5]  As required by New Jersey law, the Applicant filed a Confirmed Discharge Notification form with the New Jersey Department of Environmental Protection (NJDEP) on April 3, 2014.[6]  In its filing, the Applicant reported that the site’s soil and groundwater were contaminated with substances such as extractable petroleum hydrocarbons, polyaromatic hydrocarbons (PAHs), and metals.  The Applicant’s filing also noted that the contamination’s discharge date is unknown and origin is from sources such as historic fill material and historic industrial operations of oil companies, a coal yard, a scrap metal recycling yard, and several rail lines.                         

On June 5, 2014, the Applicant submitted a scope of work (SOW) change request for $607,803.52 in soil remediation work.  The request involved removing and disposing of the top 12-inch layer of contaminated soil on 2.84 acres of land in Area 1, and then filling that space with a layer of clean soil overlaid with a fabric barrier and a second layer of clean topsoil.[7]  The Applicant enclosed an invoice for the soil remediation’s construction costs and a May 1, 2014 Memorandum from T&M, with attachments summarizing the LSRP’s site investigation, soil sample analysis results, and the site’s historical industrial operations.  The State of New Jersey Office of Emergency Management (Grantee) submitted the Applicant’s SOW change request to FEMA with an October 3, 2014 letter recommending approval.  On October 17, 2014, FEMA denied the SOW change request deeming the work ineligible because the soil contamination existed prior to the disaster.[8]  The Applicant continued to seek Public Assistance (PA) funding for the soil remediation work in a proposed PW Amendment dated March 6, 2015, documenting $630,531.93 in soil remediation costs.[9]  On June 18, 2015, the Grantee informed the Applicant that FEMA declined to approve the $630,531.93 in soil remediation costs documented in the proposed PW Amendment, which FEMA ultimately never signed or obligated.[10]

First Appeal

The Applicant submitted a letter dated July 27, 2015, appealing FEMA’s denial to include soil remediation work in PW 3772.[11]  On first appeal, the Applicant raised several arguments challenging FEMA’s finding that the soil contamination predated the disaster.  First, the Applicant explained that there were no recorded instances of soil impacts or conditions requiring remediation work at the Facility at any time prior to the disaster.[12]  The Applicant also emphasized that the Facility was commissioned in 1991 without surface soil contamination and was constructed in accordance with NJDEP standards.[13]  Additionally, the Applicant insisted that any pre-existing soil conditions would have been discovered during the Facility’s commission and construction because the Facility was developed under close scrutiny of state officials and the media.  The Applicant also contended that the contamination was caused by the disaster’s floodwaters and by debris deposited at the Facility during the disaster.  Moreover, the Applicant asserted that the soil contamination resulted from eligible work, such as the soil excavation work performed during the flagpole repairs that disturbed the clean layer of surface soil placed on the Facility during its construction in 1993.  The Applicant also argued that FEMA should deem the soil remediation work eligible for PA funding as an upgrade required by state codes or standards because the soil excavation work performed during the flagpole repairs in Area 1 led to the discovery of the Facility’s soil contamination, which triggered the soil remediation requirements under NJDEP’s Site Remediation Program.  In closing, the Applicant stressed that the soil remediation work required by NJDEP was absolutely necessary to restore the Facility to its predisaster condition and function.[14]

On March 25, 2016, FEMA sent a Final Request for Information (RFI) to the Applicant, which stated that the Administrative Record lacked sufficient evidence to support the Applicant’s assertion that the disaster caused the contamination at the Facility.  The Applicant responded on May 6, 2016, with a letter reiterating the arguments presented in its appeal and attached a letter of support from T&M dated May 5, 2016.[15]  In its letter of support, T&M explained that the Facility was constructed in accordance with NJDEP rules, had no record of soil contamination, and was fully functioning immediately prior to the disaster.[16]  T&M also stated that the contamination resulted from debris deposited in the Facility’s topsoil layer during the disaster and flooding that caused the groundwater table to rise bringing underground contamination up to the Facility’s surface soil.  Lastly, T&M argued that the Facility would need to be closed to the public without completing the recommended soil remediation work.  The Grantee concurred in its response letter, and noted that the Facility was listed on NJDEP’s Green Acres Program’s open space inventory, which confirmed that the Facility was constructed in full compliance with the rules and regulations under its NJDEP development permit.  Moreover, the Grantee urged FEMA to contact a Compliance Officer at NJDEP’s Green Acres Program to request archived files containing historical information regarding the Facility’s affiliation with the Green Acres Program.[17]

On July 27, 2016, the FEMA Region II Regional Administrator (RA) denied the first appeal on grounds that the soil remediation work was not required as a result of the disaster.  The RA found that the Applicant did not demonstrate that the soil contamination was directly caused by the disaster or by the performance of eligible work.  Additionally, the RA referenced documentation indicating that the soil contamination predated the disaster, such as the Confirmed Discharge Notification form signed by the Applicant’s Director of Public Works on April 3, 2014.  In that form, the Applicant listed the contamination’s discharge date as “[u]nknown” and identified the source of contamination as historic fill material and historic operations.[18]  In response to the Applicant’s claim that FEMA should deem the soil remediation work eligible for PA funding as a code-mandated upgrade, the RA explained that a code-mandated upgrade must apply to eligible work related to a disaster-damaged element of the Facility in order to be eligible.  Accordingly, the RA concluded that the soil remediation work did not qualify as an eligible code-mandated upgrade because the codes and standards cited by the Applicant in this instance only applied to the soil and not to a disaster-damaged element of the Facility, such as the flagpoles’ structural components. 

FEMA’s Region II later re-opened the first appeal to consider the Applicant’s Final RFI response.[19]  On October 21, 2016, the RA re-issued the first appeal decision and noted that the additional information submitted in the Final RFI response did not warrant changes to the original first appeal decision.

Second Appeal

In its letter dated November 22, 2016, the Applicant appeals the RA’s first appeal decision and requests $630,531.93 in soil remediation work.  On second appeal, the Applicant argues that FEMA’s conclusion that the soil contamination predated the disaster is “unrealistic” and “is in no way supported by historical records.”[20]  In addition, the Applicant attributes the soil contamination to “debris laden flood waters during Hurricane Sandy and the disturbance of the surface soils” during the performance of eligible work at the Facility. The Applicant also contends that the soil remediation work is an eligible code-mandated upgrade required as a result of eligible work because it would have been impossible to complete the eligible work in PW 3772 without damaging the Facility’s layer of surface soil.  On November 23, 2016, the Grantee transmitted a letter of support to FEMA with the Applicant’s second appeal. 

Discussion

Direct Result of the Disaster/Predisaster Conditions

Pursuant to the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) § 406, as implemented by Title 44 of the Code of Federal Regulations (44 C.F.R.) § 206.226, FEMA may reimburse eligible applicants for the repair, restoration, reconstruction, or replacement of a public facility damaged or destroyed by a major disaster on the basis of the facility’s design as it existed immediately prior to the disaster and in conformity with other provisions.^[21]  However, the Applicant must establish that all work items for which funding is requested are required as a result of the disaster,[22] and the Applicant must provide documentation differentiating those disaster-related work items from work to repair damage caused by a pre-disaster event, a post-disaster event, or inadequacies that existed prior to the disaster.^[23]  On appeal, it is the Applicant’s burden to substantiate each of its claims with documentation and clearly explain how that information supports each claim.^[24] 

The Applicant has not demonstrated that the surface soil remediation work is required as a result of the disaster.  The Applicant proffered many ideas speculating on possible disaster-related causes of the Facility’s surface soil contamination, but has not provided adequate supporting documentation to show the actual cause of the contamination.  On first appeal, the Applicant suggested that disaster-related floodwaters and debris contaminated the surface soil.  In its Final RFI response and attached letter of support from T&M, the Applicant also argues that floodwaters eroded the surface soil exposing contaminated subsoil.  On second appeal, the Applicant attributes the contamination to surface soil disturbances from disaster-related excavation, repair work, and debris removal.  However, these claims are founded on unsupported assumptions and conclusions.  For instance, the Applicant’s contention that disaster-related debris caused the contamination assumes the debris was contaminated, but the Applicant did not demonstrate that any of the disaster-related debris deposited at the Facility was tainted.  Likewise, the Applicant has not established that the disaster’s floodwaters were particularly laden with PAHs and metals.  The Applicant also concludes that the disaster-related excavation, repair work, and debris removal contaminated the Facility’s surface soil.  However, the Applicant provided no explanation or documentation to show how the disaster-related work spread contamination across 2.84 acres of land to a depth between 0.5 to 1.0 feet,[25] nor did the Applicant exclude any other potential causes such as activities that have occurred at the Facility for over 20 years.  Moreover, the Applicant provided no explanation or documentation in support of its claim that the disaster’s floodwaters eroded the surface soil exposing contaminated subsoils other than a similar conclusory statement contained within T&M’s May 6, 2016 letter; and neither statement described the extent or location of the erosion.  Finally, the Confirmed Discharge Notification form that the Applicant filed with NJDEP on April 3, 2014, contradicts the Applicant’s claims addressed above because the form notes that the soil contamination was discharged on an “unknown” date by “historic operations” or other “unknown” sources.^[26]

The Applicant also did not establish the Facility’s surface soil conditions immediately prior to the disaster.  The Applicant provided excerpts of construction bid documents dated September 20, 1991, to demonstrate that the topsoil was initially clean and remained uncontaminated until Hurricane Sandy.  These documents indicate that the Applicant was required to construct the project in accordance with NJDEP regulations and submit a mandatory topsoil analysis report.  However, the bid document excerpts are incomplete and do not establish the condition of the surface soil at the time of construction because the topsoil analysis report was omitted along with other important documents such as construction plans, designs, and specifications.  Even if this documentation was complete, it only pertains to the condition of the Facility’s topsoil in 1993 and does not establish the condition of the topsoil “immediately prior to the disaster” as required by FEMA regulations.  Moreover, it does not account for 20 years of intervening activities at the Facility, weather events, and adjacent industrial operations that could have impacted the Facility’s topsoil.

After reviewing the appeal and its entire record, FEMA finds that the Applicant has not demonstrated that soil remediation work is required as a direct result of the disaster.^[27]  Accordingly, FEMA concludes that the soil remediation work is ineligible for PA funding.

Codes and Standards

Pursuant to the Stafford Act § 406 and 44 C.F.R. § 206.226(d), FEMA may provide assistance to repair an eligible facility damaged by a disaster in conformity with current applicable codes, specifications, and standards.  The regulations define “standards” as codes, specifications or standards required for the construction of facilities.^[28]  When a facility is in violation of a code or standard at the time of a disaster, the costs associated with bringing that facility into compliance are generally ineligible for PA funding.^[29]  FEMA may reimburse costs of federal, state, and local repair or replacement codes or standards, if the codes or standards (1) apply to the type of repair or restoration required; (2) are appropriate to the predisaster use of the facility; (3) are found to be reasonable, in writing, and formally adopted and implemented by the state or local government on or before the disaster declaration date or a legal federal requirement applicable to the type of restoration; (4) apply uniformly to all similar types of facilities within the jurisdiction of the owner of the facility; and (5) were enforced during the time the codes or standards were in effect.^[30]  FEMA Disaster Assistance Policy (DAP) 9527.4, Construction Codes and Standards, further explains that all five prongs of 44 C.F.R. § 206.226(d) must be met in order for a code-mandated upgrade to be eligible for PA funding regardless of whether the work is needed to obtain a building, occupancy, or environmental permit.^[31] 

           1. Applies to the type of repair or restoration required

As required under 44 C.F.R. § 206.226(d)(1), an eligible upgrade to meet codes or standards must apply to the type of repair or restoration required.  FEMA may fund upgrades required by applicable codes or standards to elements of a facility, if such upgrades are related to disaster-related repair work.[32]  The Applicant argues that the soil remediation work is required by NJDEP’s Site Remediation Program, and must be completed to restore the Facility to its predisaster condition and use.  However, the Applicant did not demonstrate that the surface soil contamination resulted from the disaster or that the contamination was not a pre-existing condition caused by another event or activity; thus the soil remediation is not part of the eligible work.  Rather, the eligible work in Area 1 only involved repairing structural components of the Facility damaged during the disaster.[33]  NJDEP’s Site Remediation Program requirements only apply to the soil and do not apply to any of the Facility’s disaster-damaged structural components, such as the flagpoles.  Therefore, the soil remediation work required by NJDEP is ineligible because the requirements under NJDEP’s Site Remediation Program do not apply to eligible work to repair a disaster-damaged component of the Facility.

1. Uniformly applied

Pursuant to 44 C.F.R. § 206.226(d)(4), the applicable code or standard must uniformly apply to all similar types of facilities in the jurisdiction.[34]  FEMA policy explains that the code or standard cannot be subject to discretionary enforcement by building or permitting officials and must provide for uniform accountability in the event of noncompliance.[35]  The cited rules and regulations under NJDEP’s Site Remediation Program associated with the requested soil remediation work do not apply uniformly because NJDEP’s “Waiver Rule” allows NJDEP to selectively waive compliance of its rules and regulations.^[36]  Additionally, NJDEP’s Site Remediation Program gives LSRPs the authority to dictate all required soil remediation measures performed in New Jersey on a case-by-case basis.  Thus, the soil remediation work is not an eligible code-mandated upgrade because the cited rules and regulations under NJDEP’s Site Remediation Program are not uniformly applied. 

Conclusion

The Applicant has not established that the soil remediation is required as a result of the disaster, or that the work is an eligible code-mandated upgrade under 44 C.F.R. § 206.226(d).  Accordingly, the Applicant’s second appeal is denied.