Time Extension

Conclusion:  The City of Southbay’s (Applicant) first appeal was submitted more than 60 days after the final determination regarding costs of PW 5403.  In addition, the Grantee submitted the Applicant’s second appeal after the 60 day regulatory timeframe.  As such, the Applicant’s first and second appeals fail to meet the procedural requirements of 44 C.F.R. § 206.206(c).  Timeliness aside, the Applicant did not provide adequate documentation to justify an additional $16,300.75 in PA funding.

Background

In October 2005, Hurricane Wilma caused heavy rains and powerful winds that generated mixed storm debris throughout the City of Southbay (Applicant).  The Applicant utilized a debris removal contract with Phillips and Jordan, Inc. (Contractor) to remove and dispose of storm debris located on its public rights-of-way.  The Contractor disposed of 12,576.9 cubic yards (CY) of debris following Hurricane Wilma.  FEMA prepared Project Worksheet (PW) 5403 to address the debris-related work.  During closeout, FEMA determined that the Applicant’s documentation did not reflect the costs claimed for all of the debris removal work, and de-obligated $5,088.02 due to truck certification discrepancies.  On September 2, 2010, PW 5403 was obligated for $145,834.78.  The Grantee was notified of FEMA’s final determination in a letter dated September 8, 2010.   

First Appeal

In an undated, unaddressed document proffered as an appeal,[1] the Applicant asserted that “24 load tickets were missing and they never have been submitted for reimbursement to your office.” The Applicant further argued, without substantiating documentation, that the missing load tickets were issued by the “same vendor that was contracted to remove debris in the city.”

The Grantee noted that $5,088.02 was deobligated from PW 5304 in its January 4, 2013 letter forwarding the Applicant’s appeal.  In addition, the Grantee asserted that the Applicant’s 24 load tickets represented eligible work, totaling $11,212.73, that was not captured in PW 5403.  The Grantee contended that the load ticket costs should be added to the closeout version of PW 5403, but did not specify whether the Applicant was appealing FEMA’s determination to de-obligate $5,088.02 from PW 5403.  Finally, the Grantee stated, with no further explanation, that the Applicant’s first appeal was received in a timely manner.  

In the first appeal response dated May 24, 2013, the FEMA Region IV Regional Administrator (RA) found that the closeout version of PW 5403[2] constituted FEMA’s final determination of costs for the project.  As such, the Applicant’s request to include additional costs for the missing load tickets was untimely as it was submitted to FEMA 28 months after the closeout version was issued.  In addition, the RA determined that the de-obligation of $5,088.02 for documentation discrepancies was not germane to the issue presented in the first appeal.  Accordingly, the appeal was denied.

Second Appeal

The Applicant asserts in its second appeal dated July 10, 2013, that personnel changes following Hurricane Wilma led to delays in submitting documentation to FEMA regarding PW 5403, indicating that its staff’s inadequate training and understanding of the process resulted in the documentation not being provided properly.  The Applicant states that internal and external deadlines also led to a rushed process for submitting documentation to FEMA.  Finally, the Applicant states it is not seeking reimbursement of $5,088.00 deobligated during the closeout of PW 5403.

In a letter dated August 22, 2014, the Grantee argues that, while FEMA determined that $5,088.02 in PA funding was ineligible due to documentation discrepancies, it failed to indicate which truck certifications were in question.  The Grantee asserts that the Applicant checked internal records and found no discrepancies.  The Grantee concludes that the Applicant cannot properly respond to FEMA’s determination without additional details regarding the deduction in funding.  Additionally, the Grantee requests FEMA draft a new version of PW 5403 to include costs associated with the 24 load tickets.

Discussion

Appeal Timeliness

Pursuant to the Stafford Act § 423 and 44 C.F.R. § 206.206(c)(1), an eligible Applicant may appeal any determination previously made related to an application for PA funding within 60 days of receiving notice of the action that is being appealed.  In addition, pursuant to 44 C.F.R. § 206.206(c)(2), the Grantee must submit appeals from an Applicant, with a written recommendation, to the Regional Administrator within 60 days of receipt.[3]  Neither the Stafford Act nor its implementing regulations provide FEMA authority to grant time extensions for filing first or second appeals.[4]

The closeout version of PW 5403 was obligated on September 2, 2010.  While the Applicant’s first appeal is undated, the Grantee’s letter transmitting the appeal to FEMA is dated January 4, 2013.  While the Grantee asserted that the Applicant’s first appeal was received in a timely manner, it did not explain why it failed to forward the first appeal to FEMA within the regulatory timelines.  In the first appeal determination, the RA noted that the first appeal was submitted more than two years after the final determination of costs for PW 5403; therefore, the appeal was denied based on timeliness.  Although the Applicant’s second appeal provides an explanation regarding the delay of its first appeal, FEMA does not have the authority to waive or extend the 60 day statutory and regulatory timeframes.  Accordingly, the RA’s first appeal determination regarding timeliness was appropriate.

Regarding the second appeal, the Applicant submitted it within 60 days of receipt of FEMA’s first appeal determination.  However, the Grantee’s letter dated August 22, 2014, seeking clarification of the deobligation, was submitted to FEMA after the regulatory timeframe lapsed.  As such, the Applicant’s second appeal failed to meet the procedural requirements of 44 C.F.R. § 206.206(c)(2) and consequently is denied.  Timeliness aside, as described below, the second appeal also is not meritorious on the substantive issues and would otherwise be denied.  

Allowable Costs

Pursuant to the Stafford Act §§ 403 and 407, FEMA Public Assistance (PA) funding may be available to a state or local government for debris removal if the work is essential to saving lives and protecting property or in the public interest.[5]  Costs associated with debris removal work are eligible for PA funding if the costs are reasonable and necessary to accomplish the work and in compliance with federal and state procurement requirements.[6]  Pursuant to 44 C.F.R. § 13.22, only allowable costs are eligible for Public Assistance funding.  In addition, all allowable procurement costs must be adequately documented.[7]                                                                  

In PW 5403, FEMA determined that the debris removal work was eligible and the contract used to complete the work followed proper procurement standards.  FEMA also determined that the majority of costs claimed in PW 5403 were eligible under the PA Program.  However, during closeout, FEMA found discrepancies with three truck certification forms which caused FEMA to deobligate $5,088.02 in PA funding.  Neither in their first appeal, nor in their second has the Applicant provided adequate documentation regarding the truck certification discrepancies.[8]  Rather, they have only asserted that their process for obtaining reimbursement was stalled due to, among other things, personnel changes.  A truck certification list, including size of hauling bed in cubic yards, license plate number, truck identification number assigned by the owner, and a short physical description of each truck constitutes adequate documentation.[9]  Additionally, regarding the additional 24 load tickets, such items do not, in and of themselves demonstrate the work performed  was compliant with 2 C.F.R. § 225, FEMA 325, and other FEMA policy and guidance.[10]  The Applicant has failed to substantiate that the work associated with the 24 load