Sand Replacement

FEMA-1609
PA ID# 021-99021-00; Collier County
PW ID# 2700; Sand Replacement
10/02/2015

Conclusion:  On second appeal, the Applicant substantiated that an additional $6,149,099.06 for sand restoration and $1,611,405.10 for engineering, survey, and environmental compliance costs are eligible for PA funding.    

Summary Paragraph

In 2005, the Applicant was devastated by Hurricanes Katrina and Wilma which resulted in substantial sand loss on its beaches. FEMA initially prepared PW 2700 to address sand replacement at Naples Beach following Hurricane Wilma, only.  FEMA subsequently revised PW 2700 to reimburse for costs associated with replenishing Naples Beach, Vanderbilt Beach, and Park Shores following Hurricanes Katrina and Wilma and obligated Version 3 for 12,868,475.94.  Following guidance in an unrelated second appeal, FEMA Region IV deobligated $11,095,283.52 from PW 2700 in Version 6.  In a first appeal letter, the Applicant asserted that there was no technical basis for deobligating the funds, the deobligation was not based on established FEMA policies and procedures, and FEMA’s deobligation was precluded by the Stafford Act § 705(c).  The Region IV Regional Administrator (RA) partially approved the first appeal determining that $1,853,755.68 in funding would be reinstated because it represented eligible costs for dune repair, mobilization and demobilization, engineering, and survey costs that were erroneously deobligated from PW 2700.  However, the RA determined that the Applicant’s survey of losses included pre- and post-disaster sand erosion that was not eligible for PA funding, as it was not disaster-related.  In addition, the RA determined that the Stafford Act § 705(c) was not applicable because the increased scope of work was not eligible; therefore, the associated costs were inherently not reasonable.  In its second appeal, the Applicant asserts that FEMA drastically underestimated the actual amount of damage suffered by the Applicant’s beaches as a result of Hurricane Wilma and challenges the amount of funding that FEMA reinstated for engineering and environmental monitoring activities in the first appeal determination.  The Applicant requests that FEMA reinstate $6,149,099.06 for sand restoration and $3,167,206.65 for actual engineering and survey costs. 

Authorities and Second Appeals

  • Stafford Act § 406.
  • Stafford Act § 705(c).
  • 44 C.F.R. § 206.226(j).
  • OMB Circular A-87, 2 C.F.R. § 225.
  • PA Guide, at 56-61, 86-87.

Headnotes

  • The Stafford Act § 406 authorizes FEMA to reimburse costs incurred by a local government for the repair, restoration, reconstruction, or replacement of a public facility damaged or destroyed by a declared disaster.
  • Pursuant to 44 C.F.R. § 206.226(j)(2), work on an improved beach may be eligible for PA funding if the beach was constructed by the placement of sand to a designed elevation, width, and slope and the beach was maintained by periodically re-nourishing the sand through established procedures prior to the disaster.
    • The Applicant substantiated an additional 203,356 cubic yards of sand loss resulting from Hurricanes Katrina and Wilma through survey reports completed by its engineering consultant. 
    • Replacement of the additional sand loss is eligible for PA reimbursement.
  • Pursuant to OMB Circular A-87 and FEMA policy, in order to be eligible for PA funding, costs must be directly tied to eligible work and reasonable and necessary to accomplish the eligible work. 
    • The Applicant substantiated an additional $1,611,405.10 for actual engineering, survey, and environmental costs associated with its beach restoration project.

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Sand Replacement

Documentation

Main Content

Appeal Brief | Appeal Letter | Appeal Analysis | Back

Second Appeal Brief

FEMA-1909-DR
PA ID# 037-52004-00; Nashville-Davidson County
PW ID# 5523; Documentation
08/31/2015

Conclusion:  On second appeal, Nashville-Davidson County (Applicant) provided adequate documentation to support reimbursement of costs associated with resident engineering services.

Summary Paragraph

Between April 30, 2010 and May 18, 2010, severe rainstorms, tornadoes, and straight-line winds impacted Nashville-Davidson County (Applicant).  The rainstorms caused the Cumberland River to overflow and subsequently floodwaters damaged electrical and mechanical components in the generator building located at Applicant’s K.R. Harrington Water Treatment Plant.  FEMA subsequently prepared Project Worksheet (PW) 5523 documenting necessary repairs to these electrical and mechanical components.  The PW did not document resident engineering costs and disallowed direct administrative costs (DAC).  In a June 1, 2011 letter, the Applicant submitted its first appeal requesting $25,920.38 and arguing that FEMA made numerous scope and cost estimate errors.  More specifically, the Applicant argued that FEMA made errors in estimating the following costs: DAC, resident engineering costs, construction management costs, and costs to replace metal doors.  In a letter dated June 1, 2012, the FEMA Region IV Regional Administrator (RA) partially approved the appeal, granting the construction management costs and the costs to replace the metal doors but denying the request for DAC and resident engineering costs.  The RA based the denial of resident engineering costs on a lack of adequate documentation.  On August 10, 2012, the Applicant submitted its second appeal, requesting only resident engineering costs totaling $13,691.00.  Upon FEMA’s subsequent request for additional information, the Applicant provided additional documents describing resident engineer’s services. 

Authorities and Second Appeals

  • Stafford Act § 406 (a)(1)(A), 42 U.S.C. § 5172.

  • 44 C.F.R. § 13.22.

  • OMB Circular A-87 Attachment A (C)(1)(a),(j), 2 C.F.R. § 225 Appendix A (C)(1)(a),(j)

  • PA Digest, at 48.

  • PA Guide, at 40, 59.

Headnotes

  • OMB Circular A-87 provides that allowable costs must meet the cost principles of being necessary; allocable to Federal awards; and adequately documented.

    • The Applicant provided documentation to demonstrate that the resident engineering costs are necessary, allocable, and adequately documented for PW 5523.

  • PA Digest, at 48, provides that “[s]pecial services[,] which are not required on every restoration project, include engineering surveys, soil investigations, services of a resident engineer, and feasibility studies. These services must be specifically described and must be shown to be necessary for completing the eligible scope of work.”

    • This project is part of 19 separate PWs associated with flood recovery efforts of a complex nature, and could require the use of resident engineering services.

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Documentation

Procurement – Reasonable Costs

Procurement – Reasonable Costs

Main Content

Appeal Brief | Appeal Letter | Appeal Analysis | Back

Second Appeal Brief

1603
PA ID# 071-02E99-00; St. Mary’s Academy
PW ID# 17387; Procurement – Reasonable Costs
08/04/2015

Conclusion: The contract security services performed at St. Mary’s Academy were improperly procured pursuant to 2 C.F.R. Part 215; however, the actual costs were reasonable under OMB Circular A-122.

Summary Paragraph

In August 2005, Hurricane Katrina caused extensive damage to St. Mary’s Academy.  FEMA determined that the facility was eligible for replacement.  The Applicant relocated the school to a temporary location and contacted security service firms via phone and email requesting bid proposals.  Based on the proposals, the Applicant selected three security firms for services from August 2007 to July 2010.  FEMA prepared several versions of PW 17387, obligating actual costs.  The Office of the Inspector General (OIG) subsequently performed OIG Audit DD-11-15, which found that the Applicant improperly procured security services by not allowing open competition.  The OIG recommended that FEMA deobligate all funding.  FEMA concurred with the OIG’s finding, but awarded reasonable costs, which FEMA determined to be the lowest rates among the proposals, deobligating $75,862.86.  In its first appeal, the Applicant argued that it properly procured security services and that the actual costs were reasonable.  FEMA denied the first appeal, finding that the Applicant did not properly procure the services, further deobligating $40,089.77 based on new information submitted in response to the Request for Information.  The Applicant reiterates its first appeal position on second appeal.

Authorities and Second Appeals

  • 2 C.F.R. § 215.0(b)(3) (2005).
  • 2 C.F.R. § 215.1.
  • 2 C.F.R. § 215.43.
  • 2 C.F.R. § 215.44.
  • 2 C.F.R. § 215.45.
  • 2 C.F.R. § 215.46.
  • OMB Circular A-122.
  • Second Appeal Analysis, Bluebonnet Electric Cooperative, Inc., FEMA-4029-DR-TX.

Headnotes

  • Per 2 C.F.R. § 215.1, Part 215 establishes uniform administrative requirements for grants awarded to Private Non-Profits.  § 215.0(b)(3) states that, where state and local governments provide subawards to a PNP, Part 215 applies. 
    • The Applicant is a PNP.
  • 2 C.F.R. § 215.43 requires that all procurement transactions be conducted in a manner to provide open and free competition, awards be made to the bidder whose bid is responsive to the solicitation, and solicitations clearly set forth all requirements to the bidder.
    • The Applicant did not provide documentation showing that it solicited bids from multiple companies.
    • The Applicant, nonetheless, selected bidders who were responsive.
  • Section 215.44 outlines procurement procedures.
    • The Applicant did not demonstrate that it had written procurement procedures.
    • The Applicant considered and selected small, minority-owned, and/or women-owned businesses, where practicable.
    • The Applicant utilized fixed-price contracts with a set number of guards at flat rates and selected responsible contractors who possessed the potential to perform successfully.
    • The Applicant did provide FEMA with procurement documents upon request.
  • Section 215.46 requires retention of procurement records containing the basis for contract selection, justification for lack of competition, and basis for award cost or price.
    • The Applicant did not provide records.
  • Section 215.62 allows FEMA to use legally available remedies when an applicant fails to comply.  OMB Circular A-122 states that a cost is reasonable if it does not exceed that which a prudent person in the same situation would incur.
    • The Applicant provided supporting documentation establishing that the selected rates were reasonable.

 

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Procurement – Reasonable Costs