Jeffrey D. Stern
Virginia Department of Emergency Management
10501 Trade Court
North Chesterfield, VA 23236
RE: Second Appeal – Lancaster County, Elevation Project, FEMA-DR-1661-VA, Project # 0010
Dear Mr. Stern:
This letter is in response to a letter dated January 24, 2014 from Brett Burdick, which transmitted the subject appeal on behalf of Lancaster County. Lancaster County appealed the Region III Mitigation Division Director’s decision to de-obligate $130,538 (Federal share is $446,165) in ineligible costs related to the mitigation project.
The elevation project was awarded on September 25, 2008 in the amount of $446,165 federal share to elevate 7 residential structures. On January 4, 2010 the Virginia Department of Emergency Management (VDEM) requested a scope of work change to remove 1 structure, but retain the funds associated with this structure. The scope change to include 6 elevations was approved by the Regional office.
On March 24, 2010, FEMA Region III issued a Bill for Collection to VDEM for another Lancaster County elevation project awarded under FEMA-DR-1491-VA, project #33 in the amount of $97,500. At the time, only $23,978 in federal funds was available in SMARTLINK for FEMA-DR-1491-VA. Since Lancaster County did not have the funds to return the amount owed, the FEMA Disaster Finance Center (DFC), at the request of VDEM, transferred $73,522 from FEMA-DR-1661-VA to cover the Bill for Collection.
On September 10, 2010, FEMA Region III was notified by Congressman Wittman’s office about a potential violation of regulations and grant terms and conditions regarding a property located at XX Muskreek Road, White Stone, VA. On September 14, 2010 a site visit was conducted by the FEMA project officer where it was learned that the entire structure had been demolished and was being rebuilt. The structure included additional living area beyond what was originally in place (360 sq ft larger), elevation to higher than originally designed (+3.5 ft) and enclosed area below the BFE that appears to be designed for living area rather than merely for parking and storage as specified in NFIP regulation. This activity constitutes mitigation reconstruction which is not an eligible activity under HMGP.
On May 6, 2011 the FEMA Regional office provided Congressman Wittman and VDEM with their findings and determination with respect to this property. The Region indicated that Lancaster County, without prior consultation with VDEM or FEMA, allowed the homeowner to change the scope of work on this property from an elevation to a mitigation reconstruction project. Over the next several months the Region attempted to obtain documentation regarding this particular property as well as the 5 other properties that were included in the elevation project.
On May 13, 2013 VDEM and FEMA staff conducted a joint visit of all 6 properties included in the elevation project. During the site visit it was discovered that another dwelling was in violation of NFIP requirements and terms and conditions of the grant agreement. The property located at XXX Winona Road, White Stone, VA, located in a Coastal V-zone was elevated but included enclosed area below the BFE in violation of NFIP requirements. Proper documentation for this particular elevation project was not provided to VDEM or FEMA.
During the week of July 31, 2013, VDEM and FEMA reviewed all documentation submitted by Lancaster County to determine final eligibility of all project costs. The table below summarizes the final account of the federal share expended for the project:
Address | Approved (Budget) Total Elev. | Cost Final (As-built)
Total Elev. Cost | 75% Fed Share
XXX Summers Lane, WhiteStone, VA | $90,387.00 | $102,357.66 | $76,768.25
XX Braden Lane, White Stone, VA | $108,300.00 | $116,146.36 | $87,109.77
XXX Riverside Drive, White Stone, VA\ $83,300.00 | $80,328.40 | $60,246.30
XXX Riverside Drive, White Stone, VA | $113,300.00 | $122,002.65 | $91,501.99
XX Muskreek Road, White Stone, VA | $97,300.00 | $0.00 | $0.00
XXX Winona Road, White Stone, VA | $98,300.00 | $0.00 | $0.00
XXX Little Oyster Lane, White Stone, VA | (withdrawn) | $4,000.00 | $0.00 | $0.00 |
$594,887.00 | $420,835.07 | $315,626.30
FEMA and VDEM agreed that the two properties in question, XX Muskreek Road and XXX Winona Road, were not in compliance with applicable regulations (44 CFR, 9, 10, 13.30(d), 13.36, 60.3(e)(5), 206.434(c)(3)) and terms and conditions of the grant and subgrant agreements and therefore all costs associated with these properties would be disallowed.
On October 24, 2013, VDEM reimbursed FEMA in the amount of $204,061.22 as directed by FEMA Regional staff.
In response to the first level appeal, the Regional Office determined that the two properties in question; XX Muskreek Road and XXX Winona Road were ineligible to receive HMGP funding. The Muskreek Road property was an ineligible project type (mitigation reconstruction) and the Winona Road property was not compliant with NFIP regulations with respect to enclosures below the Base Flood Elevation (BFE). Both VDEM and the FEMA Regional office were in agreement with this determination. With the second level appeal submission, no new evidence has been presented that would refute this initial determination.
The VDEM returned $204,061 to FEMA as a result of the determination of ineligible costs for the above referenced properties. The total federal share available under this HMGP award was $446,165. The total eligible costs for the project were $315,626 as determined in a joint review by VDEM and FEMA Regional staff. The difference in these two figures is what should be de-obligated under this grant ($446,165 - $315,626 = 130,539). In addition, the FEMA Regional office directed VDEM to return $73,522 associated with the shortfall for DR-1491 for a total reimbursement of $204,061.
The Regional Office properly directed VDEM to reimburse FEMA a total of $204,061 associated with DR-1491 and DR-1661. Since this funding has already been reimbursed by VDEM, no new action is necessary. By copy of this letter, I request the Regional Administrator to take appropriate action to implement this determination.
Please inform Lancaster County of this decision. My determination is FEMA’s final decision on this matter pursuant to Title 44 CFR 206.440, Appeals.
Roy E. Wright
Deputy Associate Administrator for Mitigation
cc: Matthew Wall, State Hazard Mitigation Officer
MaryAnn Tierney, Regional Administrator, FEMA Region III
Eugene K. Gruber, Division Director, Mitigation Division, FEMA Region III