Beaches – Direct Result of the Disaster – Legal Responsibility – Other Federal Agency – Sand Replacement

Appeal Brief

Severe storm surge from Hurricane Isaac during the incident period August 26 to September 10, 2012 caused damage to sand fencing, a beach and dunes, as well as vegetative plantings that were part of BA-30.  FEMA prepared Project Worksheet 1573 to document the repair work, finding sand fencing repairs eligible and the remainder of the work ineligible due to a lack of a regular maintenance plan and the work being the responsibility of another federal agency.  On first appeal, the Applicant argued that: (1) the work is eligible because there is no other agency with specific authority to repair the damages in question; (2) FEMA’s denial of eligibility on the basis of purported legal authority of another federal agency is contrary to statute, regulation, and policy; (3) BA-30 is an eligible nonstructural project for shoreline stabilization designed to mimic, enhance, or restore natural stabilization systems per 44 C.F.R. § 206.345; and (4) BA-30 is an eligible facility because it does not require routine maintenance or FEMA should recognize inspection reports as sufficient to establish pre-disaster condition.  The FEMA Region VI Regional Administrator determined that the work was not under the specific authority of another federal agency, but denied the first appeal finding that the natural features of BA-30 were not maintained and thus failed to meet the regulatory requirements to be considered an improved beach.  On second appeal, the Applicant argues that FEMA’s denial is erroneous because BA-30 is an eligible “facility.” 

Authorities and Second Appeals

• Stafford Act §§ 102(9)(C), 312(a) 705(c).
• 16 U.S.C. §§ 3502(6)-(7), 3951-3956.
• 43 U.S.C. § 1356a
• 44 C.F.R. §§ 206.201(c), (j), 206.226(a), (j), 206.340, 206.343(a).
• PA Guide, at 22.
• FEMA Recovery Policy FP-205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures (Mar. 31, 2016).
• FEMA Second Appeal Analysis, Louisiana Department of Natural Resources Isles Dernieres Restoration Projects, FEMA-1437-DR-LA (Jan. 25, 2005)
• FEMA Second Appeal Analysis, Ventura County, FEMA-1577-DR-CA (July 7, 2009)

Headnotes

• 44 C.F.R. § 206.201 defines a facility as “any publicly or privately owned building, works, system or equipment, built or manufactured, or an improved and maintained natural feature.”
  • Louisiana’s coastal barrier islands, as a whole, do not qualify as a “system” because they were not “built or manufactured.”
• The PA Guide states that maintenance must have been done on a regular schedule and to standards to ensure that the improvement performed as designed.
  • BA-30 is not a “facility” because the Applicant failed to demonstrate that the barrier island was maintained.
• 44 C.F.R. § 206.226(a) limits PA funding where there is another Federal authority to restore facilities. 

CWPPRA creates an ongoing Federal program to specifically address restoration of the barrier islands.

Appeal Letter

Appeal Analysis

Background

Severe storm surge from Hurricane Isaac during the incident period August 26 to September 10, 2012 caused damage to sand fencing, a beach, dunes, and vegetative plantings that were part of the East Grand Terre Pass Barrier Island Restoration Project (BA-30).  The Coastal Protection and Restoration Authority (CPRA) (Applicant) serves as the designated state agency for BA-30.[1] 

Construction of BA-30 was funded by the Department of the Interior’s Minerals Management Service (MMS)[2] through a Coastal Impact Assistance Program (CIAP)[3] grant in 2008.[4]  However, the National Oceanic and Atmospheric Administration National Marine Fisheries Service funded the engineering and design work and acquisition of permits and land rights under the Coastal Wetlands Planning, Protection and Restoration Act of 1990 (CWPPRA).[5]  The project was completed in November 2010.[6]

FEMA prepared Project Worksheet (PW) 1573, Category G, to document replacement of approximately 6,060 feet of sand fencing, 60,000 vegetative plantings, and 1,303,741 cubic yards of beach and dune fill, including engineering and design services.  FEMA found $100,000 of repairs to the sand fencing to be eligible but determined that $29,460,144.00 of costs claimed for beach and dune fill and vegetative plantings were ineligible because (1) funding to repair BA-30 is the responsibility of another federal agency;[7] and (2) the Applicant did not demonstrate the improved beach, dunes, and vegetative plantings were regularly maintained.[8] 

First Appeal

The Applicant appealed FEMA’s determination on January 31, 2014.  The Applicant argued that: (1) the work is eligible because there is no specific authority under the CWPPRA or Energy Policy Act of 2005, which created the CIAP, to repair the damages in question; (2) FEMA’s denial of eligibility on the basis of another federal agency’s legal authority is contrary to Section 312 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) and FEMA’s regulations and policies; (3) BA-30 is an eligible nonstructural project for shoreline stabilization designed to mimic, enhance, or restore natural stabilization systems per FEMA regulations implementing the Coastal Barrier Resources Act (CBRA); and (4) a maintenance plan should not be essential for eligibility because BA-30 does not require routine maintenance to function as designed, or FEMA should recognize inspection reports as sufficient to establish pre-disaster condition.[9]

The State of Louisiana Governor’s Office of Homeland Security and Emergency Preparedness (Grantee) transmitted the first appeal on April 3, 2014.  The Grantee’s forwarding letter emphasized that the work is not the responsibility of another federal agency, stressing that FEMA has not completed its obligation to coordinate with other agencies to determine legal responsibility.  The Grantee also requests the Applicant be provided with an opportunity to present information and documentation demonstrating BA-30 has a routine maintenance plan.[10]

On March 19, 2015, FEMA sent a Final Request for Information (RFI) to the Grantee, requesting: (1) the amount of funding being appealed for each project component; (2) official documentation to de-authorize BA-30 from CWPPRA; (3) contracts, agreements, and funding documents related to the CIAP grant; (4) pre and post disaster maintenance plans and inspection reports; and (5) documentation establishing the beach as an engineered beach.[11]  In its response, the Applicant indicated it had submitted all required documentation and requested FEMA review the Cost Share Agreement.[12]  The Applicant also reserved the right to provide written confirmation that no other federal agency has responsibility for the work, which it was in the process of obtaining.[13] 

The FEMA Region VI Regional Administrator (RA) denied the first appeal on August 10, 2015.  The RA determined that: (1) the components of BA-30 were not regularly maintained, and thus failed to meet facility eligibility requirements to be considered an improved and maintained natural feature; (2) BA-30 was not an eligible improved beach because it was not maintained to specific standards to ensure improvements performed as designed; (3) projects must meet Public Assistance (PA) eligibility requirements before determining whether the project is compliant with the CBRA; and (4) the USFWS does not have specific authority for projects that receive CIAP grant funding.[14]  The RA also clarified that Section 312(a) of the Stafford Act, rather than Section 312(b)(1), is the relevant authority applicable to duplication of benefits.

Second Appeal

The Applicant submitted a second appeal by letter dated October 19, 2015.  The Applicant argues that FEMA’s denial is erroneous because BA-30 is a “facility” eligible for PA.[15] 

The Grantee transmitted the second appeal to FEMA Region VI on December 21, 2015 and supplements the Applicant’s main arguments.  The Grantee asserts that neither CWPPRA nor the Energy Policy Act of 2005 establishes responsibility in another federal agency to assist the Applicant; and even if another federal agency had legal responsibility to provide assistance, Stafford Act § 312(b) allows FEMA to provide funding if the Applicant has not yet received benefits or has only received partial benefits from the other agency, which has not occurred in this instance.  The Grantee also argues that BA-30 is a unit connected to a Coastal Barrier Resources System (CBRS) and therefore undergoes a separate and distinct eligibility analysis based solely on the consultation and consistency requirements of Title 44 Code of Federal Regulations (44 C.F.R.) §§ 206.348 and 206.349.[16]

Discussion

Facility Eligibility of Louisiana’s Coastal Barrier Resources System

The Applicant claims that FEMA’s denial of eligibility of PW 1573 is incorrect because BA-30 is a facility eligible for PA.[17]  It argues that FEMA failed to recognize BA-30 as part of the CBRS, a “system,” and that all of its component parts comprise an eligible “facility.”[18]

FEMA recognizes that BA-30 is part of the Grand Terre Islands, numbered S02 on the Louisiana CBRS maps.[19]  FEMA also notes that the Coastal Barrier Resources Act (CBRA) uses the term “system” to mean the barrier resource system defined in the Act,[20] which is comprised of “undeveloped” system units.[21]  However, the CBRA and its implementing regulations perform a different function than the Stafford Act, which uses the term “system” as part of a definition to establish PA eligibility for a wide range of facilities.  The Stafford Act definition of “public facility” includes “any other public building, structure, or system.”[22]  The word “system” is used in conjunction with the words “building” and “structure” to describe other types of public facilities that are man-made, such as sewage systems or electric power distribution systems.  In contrast, the CBRA defines “system unit” to mean “any undeveloped coastal barrier, or combination of closely-related undeveloped coastal barriers, included within the [CBRS].”[23]  This definition is inclusive of Louisiana’s barrier islands because, as a whole, the islands are not man-made but are naturally occurring landforms that are undeveloped and subject to constant change due to wave and tidal action.  In line with legislative intent, FEMA’s regulatory definition of “facility” excludes such undeveloped systems that are not “built or manufactured.”[24]  As Louisiana’s CBRS was not “built or manufactured,” it does not qualify as a “system.”

The statutory and regulatory constraints that limit eligible facilities to structures, buildings, and systems that are “built or manufactured” by man, is supported by the fact that the Stafford Act bases the amount of assistance off “the design of the facility as it existed immediately before the disaster event.”[25]  FEMA regulation embodies this by requiring that permanent work restore an eligible facility on the basis of its predisaster design and applicable standards.[26]  Louisiana’s system of barrier islands lack a predisaster design because they are naturally occurring and their formations constantly change.  Louisiana’s CBRS does not have a “predisaster design” to which it can be constructed because the system as a whole was never designed in the first place.

Facility Eligibility of BA-30 as a Natural Feature

The Applicant alternatively argues that BA-30 is eligible for PA funding because it is an improved and maintained natural feature.[27]  The Applicant supports its claim that the island has been maintained by asserting that projects (past and ongoing) have improved and maintained the “system” of barrier islands, of which it is a part.  It asserts that system wide projects equate to maintenance for BA-30.  Specifically, it cites Louisiana’s 2002 Barrier Island Comprehensive Monitoring Program (BICM) to provide long-term data about the system,[28] and two bills passed by the Louisiana legislature (House Bills No. 429 and 1034) in 2004 establishing the Barrier Island Stabilization and Preservation Program, to select and prioritize maintenance projects.[29] 

Pursuant to 44 C.F.R. § 206.201, a facility is defined as “any publicly or privately owned building, works, system or equipment, built or manufactured, or an improved and maintained natural feature.”[30]  For an “improved and maintained natural feature”[31] to be eligible, maintenance “must have been done on a regular schedule and to standards to ensure that the improvement performed as designed.”[32]  FEMA also looks to maintenance or inspection reports to verify the pre-disaster condition of facilities and to determine if the work is required as a direct result of the disaster.[33]  BA-30 is a barrier island, which is a natural feature, and held to the requirement of being improved and maintained.

The Applicant has failed to provide any evidence that BA-30 has been regularly maintained.  The Applicant’s argument that maintenance of one piece of a “system” constitutes maintenance of the entire system is flawed.  For example, if one segment of a road system is maintained regularly (e.g., a bridge), that does not constitute maintenance of the entire road system and other bridges within the system.  When considering BA-30 individually, the Applicant has not demonstrated regular maintenance.  The barrier islands appear to be designed to develop naturally rather than maintain a strict design standard, allowing for erosion to some degree during storms as part of its natural migration, which is why there are no maintenance requirements.  This lack of maintenance is affirmed by the 2002 CWPPRA Adaptive Management Review, which recognizes that barrier island projects “should” include operation and maintenance plans, but recognizes that “[d]ue primarily to funding constraints, barrier islands [do not] include maintenance” and these “cost constraints are hampering their adoption.”[34]  Likewise, the Applicant’s Fiscal Year 2012 Annual Plan states “that barrier islands migrate and deteriorate over time” and require regular maintenance;[35] however, despite these challenges “scheduled maintenance of these projects has not been incorporated into their funding or design.”[36]  In sum, the barrier islands continue to exist as a natural feature without any regular maintenance by the Applicant.[37]  As such, FEMA finds the proposed work ineligible for PA grant funding.[38]

Eligibility of BA-30 as an Improved Beach

To the extent that the Applicant and Grantee request consideration of the work in accordance with FEMA regulatory[39] and policy requirements[40] for beaches, the work is not eligible for PA grant funding.  To be eligible for PA funding, an improved beach must be constructed by the placement of sand (of proper grain size) to a designed elevation, width, and slope; and the applicant must establish and adhere to a maintenance program involving periodic renourishment of sand.  The Applicant has not demonstrated that BA-30 was designed to a certain elevation, width, and slope with sand of a particular grain size prior to the disaster.[41]  Additionally, as discussed in the preceding subsection, the Applicant has not shown it has a maintenance program involving periodic sand renourishment nor routine maintenance to BA-30.  Finally, the Applicant has not demonstrated BA-30 was constructed according to specific requirements and maintained to those standards.  As such, it is not eligible for PA grant funding. 

Eligibility of Sand Fencing

To be eligible for PA funding “an item of work must be required as a direct result of the declared disaster.”[42]  Normal maintenance that existed prior to the disaster is not eligible[43] and it is the “applicant’s responsibility to show that the damage is disaster-related.”[44]  When preparing the damage description for PW 1573, FEMA relied on statements made by the Applicant that the sand fencing was “destroyed by incident-period surge waters.”[45]  FEMA determined the sand fencing repairs to be eligible based on “previously approved claims” for other similar declared disasters[46] and the Applicant’s stated intent to maintain sand fencing over the twenty-year life of the project.[47]  Unfortunately, the Applicant’s statement that the sand fencing was damaged by surge waters is not supported by documentation.[48]  The administrative record does not include any maintenance or inspection reports that would reflect that the sand fencing damage resulted from the disaster.  Likewise, FEMA improperly relied upon previously approved claims for sand fencing repairs and statements by the Applicant that it maintained the sand fencing.  As the Applicant has not demonstrated disaster related damage associated with the sand fencing, its repair is not eligible for reimbursement.

Applicability of FEMA’s Regulations Implementing the CBRA

The Grantee argues that because BA-30 is a unit of the CBRS, FEMA must determine eligibility for PA in accordance with the consultation and consistency requirements of 44 C.F.R. §§ 206.348 and 206.349 in lieu of FEMA’s PA eligibility requirements.[49]  The Grantee’s argument, however, is not supported by statute or regulation.  The CBRA was enacted in 1982 to prohibit new expenditures and new financial assistance, including disaster assistance, by federal agencies within the CBRS for all but a few types of activities.  FEMA promulgated 44 C.F.R. Part 206, Subpart J to establish procedures for FEMA to comply with the CBRA “in the administration of disaster assistance.”[50]  FEMA’s regulations, in accordance with the stated purpose of the CBRA, places “limitations” [51] on the provision of assistance for the permanent restoration of facilities located in the CBRS.  The CBRA does not, as suggested by the Grantee, amend or modify the Stafford Act to create a separate disaster assistance program or expand the provision of disaster assistance funding.  The fact that BA-30 is a unit part of the CBRS, being numbered S02 on the Louisiana CBRS maps, and falling under the exemption listed at 206.344(c), does not alter FEMA’s PA eligibility requirements.  The language of the exemption states that “such assistance and expenditures may be made available,”[52] which indicates discretion in awarding assistance.  FEMA exercises this discretion by awarding PA funding in accordance with the criteria described in 44 C.F.R. Part 206 and applicable policies. 

With regard to 44 C.F.R. §§ 206.348 and 206.349, the consultation and consistency requirements are established by 16 U.S.C. § 3505, which applies to all federal agencies.  Those requirements are additional actions that must occur prior to a federal agency making a federal expenditure or providing financial assistance for work within the CBRS.  The statutory requirements do not establish specific disaster assistance eligibility requirements.  As FEMA did not find the work eligible for PA funding, it was not required to meet the consultation and consistency requirements.

The Applicant also argues that Congress intended the CBRA’s statutory exemption of BA-30, being numbered S02 on the Louisiana CBRS maps, to be interpreted broadly so that federal agencies provide funding for “stabilization and erosion control projects in units depicted on maps S01 through S11 so as to address the serious erosion problems facing Louisiana's coastline.”[53]  The Applicant’s interpretation of Congress’ intent ignores important context.  The exemption was established in recognition that “the coastal erosion problem is largely the result of Federal policies and actions,” such as the leveeing and channelization of the Mississippi and Atchafalaya Rivers which once renourished the marsh system.[54]  The exemption was not established to repair damage caused by natural disasters, such as hurricanes, but was focused solely on remedying the damage caused by federal “policies and actions.”[55]  Consequently, it appears Congress only intended for agencies to broadly interpret the “types of stabilization projects that may be undertaken” under the exemption.[56]  However, legislative history does not demonstrate Congressional intent for federal agencies to broadly interpret their own statutory authority to award grant funding for stabilization and erosion control projects in the Louisiana CBRS.[57]

Lastly, the Applicant contends that BA-30 falls within the CBRA exceptions, specifically 44 C.F.R. § 206.345(b)(6), and therefore does not need to meet PA eligibility requirements.  This is incorrect.  If an applicant proposes to complete work within a CBRS and the work falls within one of the exceptions, the CBRA limitations, detailed in 44 C.F.R. § 206.344, on new expenditures or financial assistance do not apply and a regional administrator “may make” disaster assistance available.  The exceptions only pertain to the CBRA limitations; not the foundations of PA eligibility.

Responsibility of Other Federal Agency

The Grantee claims that FEMA’s denial of eligibility of PW 1573 was erroneous as there is no specific authority to repair the damages in question under CWPPRA.[58]  The Grantee argues that the CWPPRA does not include authority for funding disaster damages nor does it authorize any specific federal agency to fund projects, and FEMA failed to comply with its responsibility to contact other federal agencies about their authority.[59]

PA funding is not available when “another Federal agency has specific authority to restore facilities damaged or destroyed by an event which is declared a major disaster.”[60]  While the Grantee contends that CWPPRA does not provide for restoration for disaster related damages, FEMA disagrees.

CWPPRA authorizes the Secretary of the Army to “carry out projects to protect, restore, and enhance wetlands and aquatic/coastal ecosystems.”[61]  The definition of a coastal wetlands restoration project in the CWPPRA does not specifically address disaster related repairs, rather it states simply that project activities include but are not limited to “new projects, completion or expansion of existing or on-going projects, individual phases, portions, or components of projects and operation, maintenance and rehabilitation of completed projects.”[62]  Direction with regard to the distribution of appropriations for such projects is also contained within CWPPRA.[63] 

Further, a June 26, 2015 letter from the U.S. Army Corps of Engineers (USACE) provides that “if the Federal and State sponsors of an existing CWPPRA project submit a request to restore infrastructure constructed with CWPPRA funding that was damaged or destroyed by a storm event, the Task Force has the discretion to approve or disapprove the request.”[64]  While FEMA has not consulted with the Department of the Army regarding this project, this letter reflects the discretionary authority of USACE and the Task Force, under the CWPPRA, to approve or deny project work to repair disaster related damage.  Accordingly, FEMA finds that pursuant to the plain language of CWPPRA, the responsibility for this proposed work rests with another federal agency.  The claim that CWPPRA does not include or intend to authorize projects to repair hurricane damaged structures is not supported by a reading of the plain language of the Act and PA funding is not available due to another agency’s authority.

Stafford Act § 705(c) Applicability

Section 705(c) of the Stafford Act bars FEMA from deobligating previously awarded funding if: “(1) the payment was authorized by an approved agreement specifying the costs; (2) the costs were reasonable; and (3) the purpose of the grant was accomplished.”[65]  FEMA issued FP-205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures, to implement these criteria.[66]  If all three are met, FEMA is prohibited from recouping grant funds even if it later determines that it made an error in determining eligibility.[67]  In this instance, FEMA is not prohibited from disallowing and deobligating the $100,000.00 in funding previously awarded for sand fencing because the Grantee has not drawn down funds for the work nor has the Applicant accomplished the purpose of the grant – completion of repairs to the sand fencing.  Consequently, FEMA can deobligate the $100,000.00 for sand fence repairs.

Conclusion

FEMA finds that Louisiana’s coastal barrier islands, as a whole, do not qualify as a “system” within 44 C.F.R § 206.201(c)’s definition of a “facility” as they were not “built or manufactured” in accordance with a design.  Additionally, BA-30 cannot be considered a “facility” because the Applicant failed to demonstrate that the barrier island has been maintained.  Finally, funding is also precluded by the Stafford Act and regulation because there is another Federal program specifically designed to address the environmental restoration of Louisiana’s barrier islands.  Consequently, the RA was correct in denying $29,560,144.00 in beach and dune fill replacement.  FEMA will also deobligate an additional $100,000.00 in funding previously awarded in error to repair sand fencing.