Bismarck, ND - Jackman Coulee Project
Appeal Brief
Appeal Letter
Appeal Analysis
In conclusion, after review of the second level appeal documentation, FEMA Headquarters concurs with the determination by the Region to disallow reimbursement for cost overruns requested by the City of Bismarck, North Dakota.
David I. Maurstad
Appeal Brief
| Applicant | North Dakota Department of Emergency Services |
| Appeal Type | 2nd |
| Date Signed | 2008-03-06T00:00:00 |
1st Appeal
• Issue
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.
• Reference(s)
o 44 CFR 206.434 Eligibility; 44 CFR 206.440 Appeals, 44 CFR 206.436(d) Application Procedures; 44 CFR 13.30 Changes
2nd Appeal
• Issue
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
• Issue
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.
• Reference(s)
o 44 CFR 206.434 Eligibility; 44 CFR 206.440 Appeals, 44 CFR 206.436(d) Application Procedures; 44 CFR 13.30 Changes
2nd Appeal
• Issue
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
Appeal Letter
Lonnie G. Hoffer
Alternate Governor's Authorized Representative
State of North Dakota
Office of the Adjutant General
Department of Emergency Services
Post Office Box 5511
Bismarck, North Dakota 58506-5511
Alternate Governor's Authorized Representative
State of North Dakota
Office of the Adjutant General
Department of Emergency Services
Post Office Box 5511
Bismarck, North Dakota 58506-5511
Dear Mr. Hoffer,
I am writing in response to your request dated November 26, 2007 for FEMA to review the second level appeal for the City of Bismarck (Jackman Coulee Project DR-1279-ND, P-7.) This second appeal follows the decision by the FEMA Region VIII Office in Denver to disallow cost overruns claimed for the city’s stormwater improvement project submitted under the Hazard Mitigation Grant Program (HMGP).
FEMA Headquarters personnel have thoroughly reviewed the information submitted with this second level appeal. After careful consideration I have concluded that the original determination by Region VIII to disallow the costoverrun claimed for this project should stand. The second level appeal does not contain new or substantive information that would provide grounds for overturning the decision made at the Region.
The Regional Office found the following costs to be ineligible:
An increase in the size of the stormwater detention structure constituted a change to the approved scope of work which resulted in a cost overrun for the project in the amount of $1,142,612. The grantee did not seek approval from FEMA before implementing this scope change. (44CFR Part 13.30(d)(1))
In conclusion, after review of the second level appeal documentation, FEMA Headquarters concurs with the determination by the Region to disallow reimbursement for cost overruns requested by the City of Bismarck, North Dakota.
If you have any additional questions regarding this issue, please contact Mike Hillenburg, Chief, Hazard Mitigation Assistance Branch, Region VIII, at (303) 235-4875.
Sincerely,
David I. Maurstad
Assistant Administrator
Mitigation Directorate
Mitigation Directorate
cc: Douglas A. Gore, Acting Regional Adminstrator, FEMA Region VIII
Michael Hillenburg, Hazard Mitigation Assistance Branch Chief
Michael Hillenburg, Hazard Mitigation Assistance Branch Chief
Appeal Analysis
An increase in the size of the stormwater detention structure constituted a change to the approved scope of work which resulted in a cost overrun for the project in the amount of $1,142,612. The grantee did not seek approval from FEMA before implementing this scope change. (44CFR Part 13.30(d)(1))
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