o FEMA Region VIII approved a flood control project under HMGP for construction of a detention structure with channel drainage improvements to mitigate flooding problems. The State of North Dakota’s Water Control Board reviewed the project after it had been awarded by FEMA and found that it met the criteria of a dam. As a dam, the State required that it be built to higher standards than originally planned; therefore the scope of the original structure was expanded resulting in an unapproved scope of work (SOW) change that caused a cost overrun. The subgrantee argued that the joint site visits and conference calls provided sufficient notice of the change in SOW and additional expenses. A formal request however for SOW change prior to completion of the project was not submitted to the Region, and the Region thereby denied reimbursement for the resulting cost overrun.
• Reason for Denial
o Region VIII based the denial of the 1st appeal on the fact a formal SOW change request was not received prior to project completion and that language in the application letter and environmental notices clearly state the need for formal written approval for changes in SOW.
o 44 CFR 206.434 Eligibility; 44 CFR 206.440 Appeals, 44 CFR 206.436(d) Application Procedures; 44 CFR 13.30 Changes
o The subgrantee filed a second appeal, stating that site visits and conference calls provided sufficient notice of the change in scope and additional expenses, and the requested reimbursement for cost overrun should be granted.
• FEMA Findings
o FEMA HQ denied the 2nd appeal, supporting Region VIII’s decision to deny the 1st appeal.
o Rationale: An increase in the size of the stormwater detention structure constituted a change to the approved SOW and caused a cost overrun for the project. The grantee did not seek approval from FEMA before implementing this scope change.
o Reference(s): 44 CFR 206.440 Appeals; 44 CFR 206.434 Eligibility; 44 CFR 206.436(d) Application Procedures; 44 CFR 13.30 Changes