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Force Account Labor Overtime

Appeal Brief Appeal Letter

Appeal Brief

DisasterFEMA-1604-DR
ApplicantCity of Gulfport
Appeal TypeSecond
PA ID#047-29700-00
PW ID#Project Worksheets 3911, 7827, 9510 and 10220
Date Signed2009-01-06T05:00:00
Citation: FEMA-1604-DR-MS, City of Gulfport, Force Account Labor Overtime, Project Worksheets 3911, 7827, 9510, and 10220

Cross-reference: Overtime, Labor Costs

Summary: Two days after Hurricane Katrina made landfall, the City of Gulfport (Applicant) authorized overtime at the rate of two times the normal pay for the Applicant’s employees to perform emergency protective measures. FEMA’s Response and Recovery Policy 9525.7, Labor Cost–Emergency Work, permits funding if an applicant’s eligible costs for straight and overtime according to the Applicant’s written policies in effect prior to the disaster. Accordingly, following the Applicant’s Personnel Policy and Procedures Manual dated April 20, 2004, Section 110, page 7, FEMA approved overtime for force account labor at a rate of one and one-half times the normal pay (totaling $1,357,236.84). FEMA denied the additional overtime (totaling $727,427).
Issues: Are overtime policies implemented after the event eligible for FEMA funding?
Findings: No.

Rationale: Response and Recovery Policy 9525.7, Labor Costs–Emergency Work,
dated July 20, 2000.

Appeal Letter

January 6, 2009

Thomas M. “Mike” Womack
Governor’s Authorized Representative
Mississippi Emergency Management Agency
Post Office Box 5644
Pearl, Mississippi 39208-5644

Re: Second Appeal–City of Gulfport, PA ID 047-29700-00, Force Account Labor Overtime,
FEMA-1604-DR-MS, Project Worksheets (PW) 3911, 7827, 9510 and 10220

Dear Mr. Womack:

This letter is in response to your letter dated October 1, 2008, which transmitted the referenced second appeal on behalf of the City of Gulfport (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) denial of funding for overtime costs at a rate of two times the normal pay for the Applicant’s employees.

Two days after Hurricane Katrina made landfall, the Applicant authorized overtime at the rate of two times the normal pay for its employees to perform emergency protective measures. FEMA’s Response and Recovery Policy 9525.7, Labor Costs–Emergency Work, permits funding of an Applicant’s overtime costs in accordance with written policies that are in effect prior to the disaster. Accordingly, following the Applicant’s Personnel Policy and Procedures Manual dated April 20, 2004, Section 110, page 7, FEMA approved overtime for force account labor at a rate of one and one-half time the normal pay.

The Applicant submitted its first appeal to the Mississippi Emergency Management Agency (MEMA) on November 7, 2007. The Applicant stated that its city council declared a local state of emergency two days prior to Hurricane Katrina’s landfall, which, among other preparedness measures, empowered the mayor, at his discretion, to pay overtime up to two times the normal pay to personnel that were required to work during times of hazard and curfew. Two days following landfall of Hurricane Katrina, the mayor exercised the authority given him by the city council and approved an overtime pay rate of two times the normal pay for employees who worked above the normal work schedule during the emergency. The Regional Administrator denied the appeal in a letter dated May 28, 2008, stating the Applicant did not provide any evidence that it paid overtime at the rate of two times the normal pay to its employees for any event except Hurricane Katrina. The Regional Administrator also stated that the mayor’s discretionary authority to pay two times the normal pay following a named storm is not
consistent with OMB Circular A-87, Cost Principles for State, Local, and Indian Tribal Governments.

The Applicant submitted its second appeal on August 5, 2008. The Applicant attached supporting documentation including a resolution of the Gulfport City Council authorizing the mayor to pay overtime up to double time at his discretion, a proclamation by the mayor declaring a civil emergency, a memorandum describing the City of Gulfport payroll policy for Hurricane Katrina, and the City of Gulfport Personnel Policy and Procedures Manual. However, the information provided does not change the discretionary nature of the authority to pay overtime at the rate of two times the normal rate of pay.
I have reviewed the information submitted with the appeal and have determined that the Regional Administrator’s decision in the first appeal is consistent with Public Assistance regulations and policy. Accordingly, I am denying the second appeal.
Please inform the Applicant of my decision. This determination constitutes the final decision on this matter pursuant to 44 CFR §206.206.

Sincerely,
/s/
Carlos J. Castillo
Assistant Administrator
Disaster Assistance Directorate

cc: Major P. May
Regional Administrator
FEMA Region IV