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.