Allowable Costs & Reasonable Costs, Immediate Threat

Appeal Brief

Appeal Letter

Appeal Analysis

Background

The coronavirus (COVID-19) pandemic resulted in a major disaster declaration for the state of South Carolina on March 27, 2020, with an incident period of January 20, 2020, to May 11, 2023. Oconee County (Applicant) requested $92,639.35 for items it purchased in response to the pandemic, including 47 Aerus Pure and Clean Air Purifiers (Air Purifiers) and various materials and supplies (e.g., personal protective equipment (PPE), cleaning and disinfecting supplies, and other items). The Applicant stated that the items were necessary for the safe opening and operation of its facilities, and that it completed all claimed work between March 6, 2020, and June 30, 2022.[1] FEMA created Grants Manager Project 700651 to document the Applicant’s claim.

FEMA issued a Request for Information (RFI) detailing the Applicant’s response to the pandemic, including the purchase and use of the Air Purifiers. In response, the Applicant provided an invoice for cleaning and disinfecting supplies; a written description of the actions it took to prevent the spread of the COVID-19 virus; a spreadsheet recording the location of each Air Purifier; and other information (press releases, articles, etc.) describing various facility closures and other mitigation measures.

FEMA issued a second RFI notifying the Applicant that the use of ionizing air purification was considered an emerging technology not supported by guidance from the Centers for Disease Control and Prevention (CDC). FEMA offered the Applicant the opportunity to withdraw the claim for the Air Purifiers or submit the project to further review. In response, the Applicant asserted that its use of the Air Purifiers was in accordance with FEMA’s policy and guidance from the CDC. Specifically, the Applicant referenced a June 2021 CDC guidance document that recommended “increased ventilation in buildings and the use of ‘portable high-efficiency particulate air filtration systems.’”[2] It stated further that, in some of its facilities, other ventilation methods were not feasible and the use of the Air Purifiers “was the best viable option for safe opening.”[3]

In a Determination Memorandum signed on July 11, 2023, FEMA denied $74,730.00 for the Air Purifiers.[4] FEMA found that the Applicant had demonstrated it used a layered approach in response to the pandemic including disinfection and cleaning in its facilities, providing hand sanitizers and PPE to its employees, and using temporary barriers for social distancing. However, FEMA found that the Air Purifiers were described by their manufacturer as ultraviolet (UV) ionic air purifiers, and noted that ionization technology was not recommended or supported by the CDC. Therefore, FEMA determined that the Applicant had not demonstrated that the use of the Air Purifiers was consistent with guidance from the CDC or public health officials available at the time of purchase.

First Appeal

On October 13, 2023, the Applicant submitted a first appeal requesting $74,730.00 for the Air Purifiers. The Applicant reiterated the assertions it made in the response to FEMA’s second RFI. Further, the Applicant stated that the Air Purifiers use “[high-efficiency particulate air (HEPA)] and activated carbon filters as well as active purification technology to reduce the airborne [COVID-19] viral particles by … 99.9 [percent].”[5] In support, the Applicant attached previously provided documentation to its appeal. In a transmittal letter dated November 17, 2023, the South Carolina Emergency Management Division (Recipient) expressed support for the appeal.

On May 25, 2024, the FEMA Region 4 Regional Administrator denied the appeal. FEMA found that the Air Purifiers used ionization technology that was not supported by CDC guidance. Further, FEMA determined that the Applicant had not demonstrated that the Air Purifiers were necessary to eliminate or reduce an immediate threat resulting from the pandemic.

Second Appeal

On July 26, 2024, the Applicant submitted a second appeal, again requesting $74,730.00 for the Air Purifiers. The Applicant reiterates positions from its first appeal. Additionally, it states that the Air Purifiers used HEPA filters in addition to other air filtration methods (i.e., activated carbon filters and “active purification technology”).[6] Thus, it asserts that the Air Purifiers were in compliance with the CDC’s June 2021 guidance, which recommended the use of air filtration systems with HEPA filters, and that it “does not believe the cost[s] should be denied due to the additional filtration technologies.”[7] In addition to previously provided documentation, the Applicant attached a scanned printout of an online sales brochure describing the function and features of the Air Purifiers (Sales Brochure). In a transmittal letter dated September 12, 2024, the Recipient reiterates the Applicant’s positions and expresses support for the appeal.

Discussion

Immediate Threat

FEMA is authorized to provide assistance for emergency protective measures to save lives and protect public health and safety.[8] For emergency protective measures to be eligible, the applicant is responsible for showing the work is required due to an immediate threat resulting from the declared incident.[9] In response to COVID-19, eligible emergency protective measures may include certain specific, limited measures implemented to facilitate the safe opening and operation of eligible facilities.[10] Air disinfection may be eligible in limited circumstances in accordance with FEMA Policy 104‑21‑0003, Coronavirus (COVID-19) Pandemic: Safe Opening and Operation Work Eligible for Public Assistance (Interim), Version 2, under the category of cleaning and disinfection.[11] FEMA may only fund air disinfection (including HEPA filters) in cases where applicants implemented a layered approach.[12] Such work must also be done in accordance with CDC guidance or that of an appropriate public health official available at the time the work was completed.[13]

The Applicant previously demonstrated that it used a layered approach in responding to the pandemic.[14] On second appeal, the Applicant asserts that because the Air Purifiers use HEPA filters among other air purification technologies, their purchase and use was consistent with CDC guidance. It provides the Sales Brochure, which demonstrates that the Air Purifiers utilize HEPA and activated carbon filters as well as the “proprietary ActivePure Technology,” which “uses [UV] light waves and a catalytic process to produce super oxide molecules and hydro-peroxides that destroy contaminants on surfaces and in the air.”[15] The Sales Brochure further describes the Air Purifiers as “combin[ing] multiple complementary technologies, including positive and negative multipoint and [radio frequency] ion generation, HEPA, and activated carbon.”[16]

Thus, notwithstanding the inclusion of HEPA filters, the Air Purifiers utilize UV light for ionization and hydrogen peroxide generation. The CDC considers ionization and hydrogen peroxide generating devices to be emerging technologies and does not support or recommend their use.[17] Therefore, the Applicant has not demonstrated that it purchased and used the Air Purifiers in accordance with guidance from the CDC or an appropriate public health official at the time the work was completed.[18]

Allowable Costs & Reasonable Costs

To be eligible, costs must be, among other requirements, necessary and reasonable to accomplish the work properly and efficiently.[19] A cost is reasonable if, in its nature and amount, it does not exceed that which would be incurred by a prudent person under the circumstances prevailing at the time the decision was made to incur the cost.[20] It is the applicant’s responsibility to provide documentation to substantiate its claim as eligible and to clearly explain how those records support its appeal.[21] FEMA may evaluate whether a claimed cost is comparable to the current market price for similar goods or services to determine cost reasonableness.[22]

The Applicant provides invoices showing that it purchased the Air Purifiers in March and May 2021 at a cost of $1,500.00 for each unit.[23] Regarding its decision to purchase the Air Purifiers, the Applicant contends that other building ventilation interventions were not feasible and the use of portable devices “was the best viable option” to safely open and operate its facilities.[24] Further, it asserts that at the time of the purchase “COVID-19 equipment/supplies were scarce.”[25]

However, in guidance available at the time the Applicant purchased the Air Purifiers, the CDC estimated a cost of approximately $500.00 per room for portable HEPA fan/filter systems.[26] Here, the Applicant provided a list of the facilities in which it used the Air Purifiers, but has not provided information supporting its assertion that the Air Purifiers were the best viable option, such as showing the number of rooms, or where the units were placed, in each facility. Likewise, the Applicant has not asserted that it considered or attempted to procure portable HEPA filtration units at a lower cost and, apart from its statements on appeal, has not provided information demonstrating that lower-cost devices were unavailable due to demand resulting from the pandemic. Therefore, notwithstanding the ineligibility of the Air Purifiers as discussed above, the Applicant has also not demonstrated the associated costs were necessary and reasonable for the safe opening and operation of its facilities during the pandemic.

Conclusion

The Applicant has not demonstrated that the Air Purifiers are eligible emergency protective measures implemented in response to COVID-19 or that the associated costs were necessary and reasonable for the safe opening and operation of its facilities. Therefore, this appeal is denied.