Appeals, Project Documentation and Closeout

Appeal Brief Appeal Letter Appeal Analysis

Appeal Brief

Disaster	1539
Applicant	Oviedo, City of
Appeal Type	Second
PA ID#	117-53575-00
PW ID#	PW 1866, 5766, 6758
Date Signed	2021-08-09T16:00:00

Summary Paragraph

Hurricane Charley, declared a major disaster (DR-1539) on August 13, 2004, impacted the City of Oviedo (Applicant).  The Applicant received Public Assistance funding for multiple projects, including Project Worksheets (PW) 1866, 5766, and 6758.  FEMA prepared project closeout versions and deobligated funds from each PW between 2007 and 2011.  In 2011 the Applicant appealed the deobligation for PW 1866.  On April 5, 2017, FEMA denied the first appeal.  On

June 24, 2019, the Florida Division of Emergency Management (Grantee) notified the Applicant that it overpaid the Applicant and requested the Applicant repay the funds to the Grantee.  On February 14, 2020, the Grantee requested disaster closeout for the Applicant’s DR-1539 projects.  On March 30, 2020, the Grantee notified the Applicant of FEMA’s closeout of DR-1539, advised of the Applicant’s appeal rights, and reiterated its repayment request.  On May 29, 2020, the Applicant appealed, contesting the indebtedness, and arguing that the reimbursement claims were unwarranted, untimely, and barred under Stafford Act section 705.  FEMA denied the appeal, finding that FEMA neither made a determination nor initiated administrative action to recover any payment from the Applicant since the projects’ closeout, the Stafford Act did not prohibit the recovery of funds, and the Applicant’s claims were not within 44 C.F.R. § 206.206.  The Applicant submitted its second appeal, contesting the closeout of DR-1539 and reiterating its first appeal arguments.

Authorities and Second Appeals

• Stafford Act § 705.
• 44 C.F.R. § 206.206.
• FP 205-081-2 at 2.
• N. Miami Beach Med. Ctr., FEMA-4337-DR-FL, at 3; St. Thomas Univ., FEMA-1609-DR-FL, at 3.

Headnotes

• An eligible applicant may appeal a determination related to the provision of Federal assistance within 60 days of receiving notice of FEMA’s determination.
  • FEMA made no new eligibility determinations after the projects were closed and appeal rights for the prior determinations lapsed.  Therefore, the appeal claims related to the provision and repayment of PA funds are untimely.
• Section 705 does not apply in cases where an applicant’s appeal rights are exhausted, including when an applicant has not submitted a timely appeal.
  • Because the Applicant’s appeal is untimely, the protections of Stafford Act section 705 do not apply.

Conclusion

The Applicant’s appeal is untimely and the protections of Stafford Act section 705 do not prohibit the Grantee’s recovery of funds.  Accordingly, the appeal is denied. 

Appeal Letter

Appeal Analysis

Background

Hurricane Charley, declared a major disaster (DR-1539) on August 13, 2004, caused damage to the City of Oviedo (Applicant).  The Applicant received Public Assistance (PA) funding for multiple projects, including Project Worksheets (PW) 1866, 5766, and 6758.  FEMA prepared project closeout versions and deobligated funds from each PW between 2007 and 2011.  In 2011 the Applicant appealed the deobligation for PW 1866.  FEMA denied the appeal[1] and the Applicant did not file a second appeal. 

On June 24, 2019, the Florida Division of Emergency Management (Grantee) requested that the Applicant repay it for funds that FEMA had withdrawn from the Grantee’s account due to cost underruns and deobligations in PWs 1866, 5766, and 6758.  On February 14, 2020, the Grantee requested disaster closeout for the Applicant’s DR-1539 projects, which FEMA completed in a letter dated March 30, 2020.  Also, on March 30, 2020, the Grantee notified the Applicant of FEMA’s closeout of DR-1539, advised the Applicant of its appeal rights, and reiterated the Grantee’s request for the Applicant’s repayment of the amount due for overpaid funds.[2]

 

First Appeal

On May 29, 2020, the Applicant submitted its first appeal, contesting its debt to the Grantee and stating that claims for repayment for PWs 1866, 5766, and 6758 are untimely and barred under   section 705 of the Robert T. Stafford Disaster Relief and Emergency Assistance (Stafford) Act.  The Applicant also asserted that it did not initially pursue a second appeal of the April 5, 2017 first appeal decision for PW 1866 because it was working with the Grantee to settle the debt, which it had fully paid pursuant to a settlement agreement with the Grantee, and that both FEMA and the Grantee were estopped from seeking recovery of any additional funds.  In its

August 10, 2020 transmittal letter, the Grantee did not support the appeal and clarified that the Applicant was not appealing FEMA’s March 20, 2020 disaster closeout notification but rather actions taken by the Grantee to recover its own overpayments to the Applicant.

On January 28, 2021, the FEMA Region IV Regional Administrator denied the appeal.  FEMA explained that there had been no determination or administrative action since the final PW versions were obligated 9-to-13 years ago that would trigger the protections in section 705 of the Stafford Act or first appeal rights in Title 44 of the Code of Federal Regulations (44 C.F.R.) § 206.206.

 

Second Appeal

On March 29, 2021, the Applicant submitted its second appeal, requesting that DR-1539 be reopened and reiterating its arguments made on first appeal.  On May 27, 2021, the Grantee transmitted the second appeal.  The Grantee reiterates its first appeal contentions.

 

Discussion

Appeals

Section 423(a) of the Stafford Act provides that any decision regarding eligibility for assistance may be appealed within 60 days after the date on which the applicant is notified of the award or denial of assistance.[3]  Implementing this provision, 44 C.F.R. § 206.206(c) requires that applicants must file appeals within 60 days after receipt of a notice of the action that is being appealed.[4] 

FEMA prepared project closeout versions and deobligated funds from the Applicant’s PWs between 2007 and 2011. The Applicant appealed the deobligation for PW 1866, which FEMA denied on April 5, 2017.  The Applicant did not file a second appeal.  FEMA did not make any new eligibility determinations after the projects were closed out and appeal rights for those determinations lapsed in 2017.  The Grantee’s attempt to seek repayment from the Applicant is not an action triggering the 60-day appeal timeframe as it is not a FEMA action.[5]  Accordingly, the appeal is untimely.

 

Project Documentation and Closeout

Section 705 of the Stafford Act bars FEMA from deobligating previously awarded funding under certain circumstances.[6]  However, FEMA’s implementing policy states that section 705 does not apply in cases where an applicant’s appeal rights are exhausted, including when an applicant has not submitted a timely appeal. [7]  Because the Applicant’s appeal is untimely, section 705 is not applicable here. 

 

Conclusion

The Applicant’s appeal is untimely and the protections of Stafford Act section 705 do not prohibit the Grantee’s recovery of funds.  Accordingly, the appeal is denied.

 

[1] Letter from RA, Region IV, FEMA to Dir. Finance Dept., City of Oviedo (Apr. 5, 2017).

[2] Letter from Fla. Div. Emergency Mgmt. to City Manager, City of Oviedo (Mar. 30, 2020).  The letter states “Should you disagree with FEMA in regards to its closeout action, you have the right to appeal, in accordance with 44 CFR § 206.206. . . . You must file an appeal within 60 days of receipt of this correspondence…”

[3] Robert T. Stafford Disaster Relief and Emergency Assistance (Stafford) Act § 423(a), 42 U.S.C. § 5189a(a) (2000).

[4] Title 44 Code of Federal Regulations (44 C.F.R.) § 206.206 (2003).

[5] FEMA Second Appeal Analysis, St. Thomas Univ., FEMA-1609-DR-FL, at 3 (June 8, 2017) (finding that a Grantee’s letter seeking repayment of PA funds following deobligations taken at project closeout was not a FEMA action triggering appeal rights, and that the event triggering the 60-day appeal timeframe was the earlier notification of project closeout).

[6] Stafford Act § 705, 42 U.S.C. § 5205.

[7] FEMA Policy FP 205-081-2, Stafford Act Section 705, Disaster Grant Closeout Procedures, at 1 (June 2, 2021).