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Debris Monitoring
Appeal Brief
Appeal Letter
Appeal Analysis
Citation: FEMA-1292-DR-NC; City of Goldsboro; Project Worksheet (PW) 4314; Debris Monitoring
Cross Reference: Debris Removal; Debris Monitoring; Reasonable Costs
Summary: Hurricane Floyd made landfall on September 16, 1999, leaving large amounts of debris across the City of Goldsboro, NC. The Applicant contracted the debris management responsibility including bid preparation and selection of contractors. Four PWs were approved to cover the debris removal costs, which totaled $738,496. PW 4314 was approved for $184,033 to cover the debris monitoring costs. During final inspection, the claimed amount of $322,660 for debris monitoring costs was determined not reasonable and therefore, not eligible. PW 4314 was approved in the amount of $188,295. This covered costs of direct labor of field staff (including fringe benefits), reimbursable expenses, and a three percent inspection fee intended to account for monitoring. The Applicant submitted a first appeal claiming actual monitoring costs were $329,166 and requesting an additional $140,871 be funded. It stated that the scope of the monitoring costs exceeded monitoring and included bid preparation, contractor selection and financial administration. The first appeal was denied on March 13, 2002, because the monitoring costs were approaching fifty percent of the actual removal costs and were determined unreasonable. The Applicant submitted a second appeal on May 22, 2002. Again the request is that an additional $140,871 be funded.
Issues: 1. Are the debris monitoring costs reasonable?
Findings: 1. Yes. The Applicants average unit costs including monitoring is less than the average calculated for a sample set for North Carolina.2.
Rationale: 44 CFR § 206.228
Hurricane Floyd made landfall on September 16, 1999, leaving large amounts of vegetative, construction and demolition (C&D), and household hazardous waste (HHW) debris across the City of Goldsboro, NC (Applicant). The Applicant tasked Post Buckley, Schuh & Jernigan (PBS&J) with providing technical expertise and personnel experienced in FEMA eligibility criteria and organizing, implementing and managing debris removal operations under an existing contract. This scope of work ranged from bid preparation to final disposal of the debris.
The debris operations were divided into two phases. During Phase 1, PBS&J awarded two time and material contracts with a ceiling of 100 hours. The contracts were to cut downed and damaged trees within the right-of-way (ROW) and remove them to staging sites for later grinding and reduction. During Phase 2, PBS&J awarded five unit-price contracts, four of which were for picking up and hauling debris and one was for reduction of debris. PBS&J inspected every load of debris at the loading site and at the dumpsite. The work was accomplished from September 1999 to January 2000.
Project Worksheets
The debris removal activities were covered in four Project Worksheets (PWs). The monitoring activities were included in a separate PW. The Applicant removed and disposed of 149,546 cubic yards of debris at a cost of $738,496. The following table presents a summary of the PWs, the scopes of work and the approved amounts.
Project Worksheet Scope Approved Total
2686 Haul C&D and HHW debris to landfill $55,364
2687 Emergency clearance of vegetative debris, haul to staging and/or reduction site $379,299
2688 Vegetative Debris removal $64,200
2739 Grinding vegetative debris $239,633
Total Debris Removal $738,496
4314 Monitoring of all debris removal $188,295
Final Inspection
During final inspection completed on July 6, 2001, FEMA determined that the claimed amount of $322,660 under PW 4314 for debris monitoring, which included a 2.9 multiplier for fringe benefits, overhead and profit, was not reasonable. FEMA allowed a total labor cost of $73,144 (straight plus overtime for fieldwork only), fringe benefit rates of 59.84% for straight time and 11.2% for overtime, an additional 10% overhead and 10% profit. These comprised the final allowable labor costs of $118,383. The $47,758 in reimbursable expenses and $22,155 for inspections (3% of the total eligible removal costs [3% x $738,495=$22,155]) were also eligible. The total eligible amount of PW 4314 was $188,295.
1st Appeal
In a letter dated October 8, 2001, the Applicant submitted its first appeal. The appeal requested that an additional $140,871 be funded. The final actual costs claimed by the Applicant for debris monitoring was $329,166. The Applicant believed that the scope of the debris management effort was beyond monitoring and included costs and risks typically assumed by the debris removal contractor thereby increasing monitoring costs accordingly. Additionally, the Applicant believed that the overhead, profit and fringe benefit computations utilized by its consultant were supported by the documentation submitted with the first appeal which included a recent audit of those rates by the Defense Contracting Agency (DCA). The Regional Director denied the first appeal on March 13, 2002, because the monitoring costs were approaching fifty percent of the actual removal costs and were determined unreasonable.
2nd Appeal
The North Carolina Department of Crime and Public Safety (State) forwarded the Applicants second appeal on May 22, 2002. The request is that an additional $140,871 be funded. Again, it believes that the costs for debris monitoring were reasonable because its consultant had executed tasks beyond monitoring and had aggressively controlled the debris removal contractors costs. Additionally, the total removal costs for the Applicant were less than removal costs only for other applicants for the same event.
Conference call
On September 10, 2002, members of FEMA Headquarters, FEMA Region IV, the State, the Applicant, and a FEMA Technical Assistance Contractor participated in a conference call to allow the Applicant and State an opportunity to present their case and any additional data not included in the second appeal package.
DISCUSSION
There are two issues to be discussed. The first is whether the three percent construction inspection fee is applicable to debris monitoring and the second is whether the Applicants monitoring costs reasonable.
3 percent Inspection Fee
The costs associated with monitoring were considered excessive because they were greater than three percent of the actual removal costs. This position is based on the Engineering and Design Services curves and discussion contained in the Public Assistance Guide (Guide). The Guide explains that if a project requires only basic construction inspection services, a fee not exceeding three percent of construction costs is allowable. Basic inspection services are defined as review of bids, work site inspection visits, checking and approval of material samples, review of shop drawings and change orders, review of contractor payment, and acting as the clients representative. A debris removal site where material must be placed carefully and compacted to ensure stability is provided as an example of a project requiring only inspection services.
The three percent inspection fee is intended to cover costs associated with technical review or inspections of a construction-type project. It is not intended for debris removal and disposal activities. Therefore, monitoring costs associated with debris removal should not be capped at three percent of the actual removal costs.
Reasonable Monitoring Costs
The total cost to remove and dispose of 149,546 cubic yards of debris was $738,496. The State performed an analysis of average debris removal costs for 21 projects from 20 applicants and five disasters in the State of North Carolina. The State calculated an average debris removal cost (without monitoring) of $8.74 for the 21 selected projects. The Applicants average unit price (with monitoring) calculates to $7.13 per cubic yard (($329,166 + $738,496)/149,546 cubic yards). Therefore, the Applicants cost per cubic yard with monitoring is less than the average cost for the 20 selected projects without monitoring.
The Applicant and PBS&J followed guidance contained in the Debris Operations Guide relevant to monitoring recommendations. The Debris Operations Guide suggests on page D-4 that applicants should monitor the debris contractor to ensure satisfactory performance. Monitoring can include verification that all debris picked up is eligible, measuring and inspecting trucks for fullness of loads, and on-site inspection of pickup areas. Applicants are given the option of page 40 of the Debris Operations Guide to hire local engineering firms when they are unable to provide sufficient monitors. The Debris Operations Guide is silent on recommended saturation rates of monitors to debris crews or to percentages of monitoring costs to removal and reduction costs.
Additionally, as part of this analysis, the raw labor rates, fringe benefit rates, overhead rate and profit have been reviewed. The makeup of the costs associated with PBS&Js monitoring efforts appears to be consistent with industry practices. Therefore, based on the above discussion, the debris monitoring costs are considered reasonable.
CONCLUSION
Based on the discussion above, the debris monitoring costs are considered reasonable. The requested amo
Appeal Brief
| Disaster | FEMA-1292-DR |
| Applicant | City of Goldsboro |
| Appeal Type | Second |
| PA ID# | 191-26880-00 |
| PW ID# | 4314 |
| Date Signed | 2003-01-29T05:00:00 |
Cross Reference: Debris Removal; Debris Monitoring; Reasonable Costs
Appeal Letter
January 29, 2003
Dr. Kenneth B. Taylor
Director
North Carolina Department of Crime Control
and Public Safety
Division of Emergency Management
1830-B, Tillery Place
Raleigh, North Carolina, 27604
RE: Second Appeal City of Goldsboro, PAID 191-26880-00, Debris Monitoring Costs, FEMA-1292-DR-NC, Project Worksheet (PW) 4314
Dear Dr. Taylor:
This letter is in response to the referenced second appeal transmitted by your letter dated May 22, 2002. The City of Goldsboro is requesting an additional $140,871 for debris removal monitoring costs associated with Hurricane Floyd.
As explained in the enclosed analysis, I have determined that the total eligible cost for debris removal monitoring activities is $329,166. This represents an increase of $140,871 over the currently approved amount. Therefore, the appeal is approved. By copy of this letter, I am requesting the Regional Director to prepare a PW to implement this decision.
Please inform the applicant of my determination. My determination constitutes the final decision on this matter as set forth in 44 CFR § 206.206.
Sincerely,
/S/
John R. DAraujo, Jr.
Assistant Director
Response and Recovery Directorate
Enclosure
cc: Kenneth R. Burris, Jr.
Regional Director
FEMA Region IV
Dr. Kenneth B. Taylor
Director
North Carolina Department of Crime Control
and Public Safety
Division of Emergency Management
1830-B, Tillery Place
Raleigh, North Carolina, 27604
RE: Second Appeal City of Goldsboro, PAID 191-26880-00, Debris Monitoring Costs, FEMA-1292-DR-NC, Project Worksheet (PW) 4314
Dear Dr. Taylor:
This letter is in response to the referenced second appeal transmitted by your letter dated May 22, 2002. The City of Goldsboro is requesting an additional $140,871 for debris removal monitoring costs associated with Hurricane Floyd.
As explained in the enclosed analysis, I have determined that the total eligible cost for debris removal monitoring activities is $329,166. This represents an increase of $140,871 over the currently approved amount. Therefore, the appeal is approved. By copy of this letter, I am requesting the Regional Director to prepare a PW to implement this decision.
Please inform the applicant of my determination. My determination constitutes the final decision on this matter as set forth in 44 CFR § 206.206.
Sincerely,
/S/
John R. DAraujo, Jr.
Assistant Director
Response and Recovery Directorate
Enclosure
cc: Kenneth R. Burris, Jr.
Regional Director
FEMA Region IV
Appeal Analysis
BACKGROUNDHurricane Floyd made landfall on September 16, 1999, leaving large amounts of vegetative, construction and demolition (C&D), and household hazardous waste (HHW) debris across the City of Goldsboro, NC (Applicant). The Applicant tasked Post Buckley, Schuh & Jernigan (PBS&J) with providing technical expertise and personnel experienced in FEMA eligibility criteria and organizing, implementing and managing debris removal operations under an existing contract. This scope of work ranged from bid preparation to final disposal of the debris.
The debris operations were divided into two phases. During Phase 1, PBS&J awarded two time and material contracts with a ceiling of 100 hours. The contracts were to cut downed and damaged trees within the right-of-way (ROW) and remove them to staging sites for later grinding and reduction. During Phase 2, PBS&J awarded five unit-price contracts, four of which were for picking up and hauling debris and one was for reduction of debris. PBS&J inspected every load of debris at the loading site and at the dumpsite. The work was accomplished from September 1999 to January 2000.
Project Worksheets
The debris removal activities were covered in four Project Worksheets (PWs). The monitoring activities were included in a separate PW. The Applicant removed and disposed of 149,546 cubic yards of debris at a cost of $738,496. The following table presents a summary of the PWs, the scopes of work and the approved amounts.
Project Worksheet Scope Approved Total
2686 Haul C&D and HHW debris to landfill $55,364
2687 Emergency clearance of vegetative debris, haul to staging and/or reduction site $379,299
2688 Vegetative Debris removal $64,200
2739 Grinding vegetative debris $239,633
Total Debris Removal $738,496
4314 Monitoring of all debris removal $188,295
Final Inspection
During final inspection completed on July 6, 2001, FEMA determined that the claimed amount of $322,660 under PW 4314 for debris monitoring, which included a 2.9 multiplier for fringe benefits, overhead and profit, was not reasonable. FEMA allowed a total labor cost of $73,144 (straight plus overtime for fieldwork only), fringe benefit rates of 59.84% for straight time and 11.2% for overtime, an additional 10% overhead and 10% profit. These comprised the final allowable labor costs of $118,383. The $47,758 in reimbursable expenses and $22,155 for inspections (3% of the total eligible removal costs [3% x $738,495=$22,155]) were also eligible. The total eligible amount of PW 4314 was $188,295.
1st Appeal
In a letter dated October 8, 2001, the Applicant submitted its first appeal. The appeal requested that an additional $140,871 be funded. The final actual costs claimed by the Applicant for debris monitoring was $329,166. The Applicant believed that the scope of the debris management effort was beyond monitoring and included costs and risks typically assumed by the debris removal contractor thereby increasing monitoring costs accordingly. Additionally, the Applicant believed that the overhead, profit and fringe benefit computations utilized by its consultant were supported by the documentation submitted with the first appeal which included a recent audit of those rates by the Defense Contracting Agency (DCA). The Regional Director denied the first appeal on March 13, 2002, because the monitoring costs were approaching fifty percent of the actual removal costs and were determined unreasonable.
2nd Appeal
The North Carolina Department of Crime and Public Safety (State) forwarded the Applicants second appeal on May 22, 2002. The request is that an additional $140,871 be funded. Again, it believes that the costs for debris monitoring were reasonable because its consultant had executed tasks beyond monitoring and had aggressively controlled the debris removal contractors costs. Additionally, the total removal costs for the Applicant were less than removal costs only for other applicants for the same event.
Conference call
On September 10, 2002, members of FEMA Headquarters, FEMA Region IV, the State, the Applicant, and a FEMA Technical Assistance Contractor participated in a conference call to allow the Applicant and State an opportunity to present their case and any additional data not included in the second appeal package.
DISCUSSION
There are two issues to be discussed. The first is whether the three percent construction inspection fee is applicable to debris monitoring and the second is whether the Applicants monitoring costs reasonable.
3 percent Inspection Fee
The costs associated with monitoring were considered excessive because they were greater than three percent of the actual removal costs. This position is based on the Engineering and Design Services curves and discussion contained in the Public Assistance Guide (Guide). The Guide explains that if a project requires only basic construction inspection services, a fee not exceeding three percent of construction costs is allowable. Basic inspection services are defined as review of bids, work site inspection visits, checking and approval of material samples, review of shop drawings and change orders, review of contractor payment, and acting as the clients representative. A debris removal site where material must be placed carefully and compacted to ensure stability is provided as an example of a project requiring only inspection services.
The three percent inspection fee is intended to cover costs associated with technical review or inspections of a construction-type project. It is not intended for debris removal and disposal activities. Therefore, monitoring costs associated with debris removal should not be capped at three percent of the actual removal costs.
Reasonable Monitoring Costs
The total cost to remove and dispose of 149,546 cubic yards of debris was $738,496. The State performed an analysis of average debris removal costs for 21 projects from 20 applicants and five disasters in the State of North Carolina. The State calculated an average debris removal cost (without monitoring) of $8.74 for the 21 selected projects. The Applicants average unit price (with monitoring) calculates to $7.13 per cubic yard (($329,166 + $738,496)/149,546 cubic yards). Therefore, the Applicants cost per cubic yard with monitoring is less than the average cost for the 20 selected projects without monitoring.
The Applicant and PBS&J followed guidance contained in the Debris Operations Guide relevant to monitoring recommendations. The Debris Operations Guide suggests on page D-4 that applicants should monitor the debris contractor to ensure satisfactory performance. Monitoring can include verification that all debris picked up is eligible, measuring and inspecting trucks for fullness of loads, and on-site inspection of pickup areas. Applicants are given the option of page 40 of the Debris Operations Guide to hire local engineering firms when they are unable to provide sufficient monitors. The Debris Operations Guide is silent on recommended saturation rates of monitors to debris crews or to percentages of monitoring costs to removal and reduction costs.
Additionally, as part of this analysis, the raw labor rates, fringe benefit rates, overhead rate and profit have been reviewed. The makeup of the costs associated with PBS&Js monitoring efforts appears to be consistent with industry practices. Therefore, based on the above discussion, the debris monitoring costs are considered reasonable.
CONCLUSION
Based on the discussion above, the debris monitoring costs are considered reasonable. The requested amo