Debris Removal
Appeal Brief
Appeal Letter
Appeal Analysis
Citation: FEMA-1311-DR-GA; Gilmer County; PW 204
Cross-reference: Debris Removal
Summary: A disaster declaration for the County was issued January 27, 2000, for an ice storm that stuck the North Georgia Mountains and Gilmer County. Gilmer County contracted with Halls Tree Service, Inc. (Contractor) to collect eligible debris. The contract specified $10 per cubic yard (CY) for debris to be picked up and hauled to a temporary debris storage and reduction site (TDSR) located at the landfill and $7 per CY for processing debris deposited at the TDSR. However, confusion arose when the Contractor changed the debris removal procedure without an authorized change order in place. Instead of hauling the loose debris to the landfill and reducing it via chipping there, the Contractor reduced the debris on site prior to transporting it to the TDSR. The Contractor then applied a 4:1 conversion ratio to increase the number of loads hauled by a factor of four and submitted a final bill for debris removal. (FEMA utilizes a 4:1 ratio to determine the volume of loose debris that is reduced to a given volume of chips.) The billing inaccuracy was discovered by FEMA at closeout when it was discovered that Halls charged Gilmer County for four times the number of truckloads it had actually hauled. FEMA disallowed $330,811. The State transmitted Gilmer Countys first appeal on July 3, 2002, supporting the Countys appeal stating that it would cause a tremendous hardship for the applicant. FEMA denied the appeal in its determination of October 16, 2002, stating that the debris conversion calculation was incorrectly applied. In its second appeal, the County stated in affidavits that it held a number of meetings with FEMA and State officials, and that both the FEMA and State officials instructed that the removal of four cubic yards of loose debris was equal to one cubic yard of chipped debris and that FEMAs representatives, cloaked with the authority of the agency, were aware of the four to one ratio being applied by Gilmer County.
Issues: Is the additional cost for hauling debris eligible for FEMA funding?
Findings: The additional charge for the hauling of debris was for work that was not performed and was not in compliance with the contract in place between Gilmer County and the Contractor and is therefore not eligible for FEMA reimbursement.
Rationale: 44 CFR §13.43, Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments, Enforcement.
On January 22, 2000, an ice storm struck the North Georgia Mountains and Gilmer County, knocking down trees and power lines. Debris was spread countywide over roads and properties. A disaster declaration for the County was issued January 27, 2000. As part of its cleanup effort, Gilmer County issued a request for proposals and on
March 17, 2000, selected Halls Tree Service, Inc. (Contractor) to collect eligible debris from County roads and right-of-ways. The final contract specified costs for each step of debris cleanup:
· $10 per cubic yard (CY) for debris to be picked up and hauled to a temporary debris storage and reduction site;
· $7 per cubic CY for processing (chipping or grinding) debris deposited at the reduction site by the contractor; and
· $7 per CY for processing (chipping or grinding) debris deposited at the reduction site by parties other than the contractor.
·
During the cleanup process the Contractor changed the debris removal procedure without an authorized change order in place. Instead of hauling the loose debris to the reduction site located at the landfill and reducing it via chipping there, as specified in the contract, the Contractor reduced the debris at the pickup sites prior to transporting it to the landfill, thereby substantially reducing the volume and number of truckloads needed to haul the debris. The change in procedure was not discovered by FEMA until closeout, when the number of truckloads appeared low in comparison to the number of cubic yards claimed.
Throughout the debris removal process, FEMA representatives explained to County officials that a conversion ratio of four to one could be applied to the amount of chipped debris in order to determine the quantities of loose debris hauled to and chipped at the reduction site located at the landfill. However, the applicability of this conversion factor was apparently misunderstood, because after completing debris clearance, the Contractor submitted a final bill of $994,814 for the hauling and chipping of debris. After reviewing the invoices at closeout it was discovered that the contractor charged Gilmer County for four times the number of truckloads it had actually hauled, applying the conversion ratio as if the Contractor had hauled loose, not chipped, debris. In the final Project Worksheet, FEMA disallowed $330,811 for the hauling of loose debris that was actually hauled as chipped debris.
First Appeal
Gilmer County appealed FEMAs determination in its letter of June 11, 2002. The County indicated that a number of Gilmer County representatives had met with FEMA representatives and discussed the method of billing, and per FEMAs direction, applied the four to one ratio to calculate hauled debris. The State transmitted Gilmer Countys first appeal on July 3, 2002, supporting the Countys appeal, stating that it would cause a tremendous hardship for the applicant. In the same letter the State also acknowledged once the documentation was submitted to the FEMA Project Officer, discrepancies were found in the reduction ratio commonly used for haul capacity for chipped debris versus loose debris.
FEMA denied the appeal on October 16, 2002, stating that the debris conversion calculation was incorrectly applied. The denial letter stated that the contract price was $10 CY of hauled material, regardless of whether it was chipped or loose debris.
Second Appeal
On March 6, 2003, the State transmitted Gilmer Countys second appeal dated
January 6, 2003. The County stated that it held a number of meetings with FEMA and State officials, and that both FEMA and State officials instructed that the removal of four cubic yards of loose debris was equal to one cubic yard of chipped debris. Upon those instructions eight invoices were submitted and approved, and that it was not until the final invoice was submitted that FEMA said that the four to one ratio was incorrect. The County submitted affidavits in support of its statement from three County officials and the Contractor.
The recollection of the discussion of the four to one ratio was consistent in three of the four affidavits. William Wright, who served as the Countys Emergency Management Director, in his affidavit indicated that the four to one ratio was repeatedly discussed, and it was not until FEMA examined the haul tickets in detail at the end of the project that the discrepancy was discovered. Danny R. Hall, President of Halls Tree Service, Inc. differed from the other statements by adding that, the compensation to be paid to Halls Tree Service, Inc. would be determined by the total number of cubic yards of whole debris (loose debris) delivered to the landfill.
The County contends that FEMAs representatives, cloaked with the authority of the agency, were aware of the four to one ratio being applied by Gilmer County. FEMAs position of denying further payment, we contend is unjustified since its agents participated in and even instructed the County to utilize a four to one ratio to determine the amount of debris to be billed. Furthermore, we contend that FEMAs approval and payment of eight periodic payments constitutes ratification of Gilmer Countys position.
DISCUSSION
The four to one conversion ratio is used to determine the volume of chipped debris for purposes of compensation from a known quantity of loose debris. However, the conversion ratio for loose debris hauled to resultant chipped debris no longer applied to the hauled debris, because it was already chipped when it was transported.
The issue regarding the application of the four to one ratio to the hauled debris was not identified by FEMA until after Gilmer County had already paid the Contractor. However, Gilmer County, not FEMA, was responsible for administering and monitoring the contract with Halls Tree Service, Inc. While, FEMA can approve changes in the Project Worksheet Scope of Work (e.g. resulting from increased amounts of debris), this was not the case with PW 204. Rather, FEMA made quarterly progress payments to the State for the eligible scope of work identified in the PW. During project closeout eligible costs are reconciled against the approved scope of work. It was at this time that FEMA discovered the discrepancy.
FEMA was not responsible for the administration of the contract with Halls Tree Service, Inc. and will not pay for work that was not performed. Whereas FEMA has the authority to assist State and local governments in disaster recovery and provides guidance for obtaining Federal assistance, FEMA does not have authority to direct contracts between another government entity and a private contractor. Nor was any FEMA official authorized to waive statutory and regulatory requirements. The Federal Government is not estopped by representations of FEMA officials that allegedly authorized applicants to expend FEMA funds in violation of the Stafford Act and the Public Assistance program regulations. Because the Contractors work was not in accordance with Gilmer Countys approved contract, under 44 CFR §13.43 (a)(2), Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments, FEMA may, Disallow (that is, deny both use of funds and matching credit for) all or part of the cost of the activity or action not in compliance.
CONCLUSION
Gilmer County paid its contractor for four times the number of truck loads of debris actually hauled. FEMA cannot reimburse applicants for work that was not performed and work that was not in compliance with the contract in place between Gilmer County and the Contractor. Accordingly, there is no basis for granting the appeal. The appeal is denied.
Appeal Brief
| Disaster | FEMA-1311-DR |
| Applicant | Gilmer County |
| Appeal Type | Second |
| PA ID# | 123-99123-00 |
| PW ID# | 204 |
| Date Signed | 2003-10-17T04:00:00 |
Appeal Letter
October 17, 2003
Mr. Mike G. Sherberger, Director
Georgia Emergency Management Agency
P.O. Box 18055
Atlanta, Georgia 30316-0055
Re: Second Appeal Gilmer County, PA ID 123-99123-00, Debris Removal, FEMA-1311-DR-GA, PW 204
Dear Mr. Sherberger:
This letter is in response to a March 6, 2003, letter forwarding the referenced second appeal on behalf of Gilmer County. The County disputes FEMAs eligibility determination regarding the hauling of debris. The amount in question is $330,811.
As described in the enclosed appeal analysis, I have determined that Gilmer County has not demonstrated that the appealed costs for the hauling of debris are eligible for reimbursement. Therefore, I am denying Gilmer Countys appeal.
Please inform the County of my decision. My determination constitutes the final decision on this matter pursuant to 44 CFR §206.206.
Sincerely,
/S/
Laurence W. Zensinger
Acting Director, Recovery Division
Emergency Preparedness & Response
Department of Homeland Security
Enclosure
cc: Kenneth O. Burris, Jr.
Regional Director
Region IV
Mr. Mike G. Sherberger, Director
Georgia Emergency Management Agency
P.O. Box 18055
Atlanta, Georgia 30316-0055
Re: Second Appeal Gilmer County, PA ID 123-99123-00, Debris Removal, FEMA-1311-DR-GA, PW 204
Dear Mr. Sherberger:
This letter is in response to a March 6, 2003, letter forwarding the referenced second appeal on behalf of Gilmer County. The County disputes FEMAs eligibility determination regarding the hauling of debris. The amount in question is $330,811.
As described in the enclosed appeal analysis, I have determined that Gilmer County has not demonstrated that the appealed costs for the hauling of debris are eligible for reimbursement. Therefore, I am denying Gilmer Countys appeal.
Please inform the County of my decision. My determination constitutes the final decision on this matter pursuant to 44 CFR §206.206.
Sincerely,
/S/
Laurence W. Zensinger
Acting Director, Recovery Division
Emergency Preparedness & Response
Department of Homeland Security
Enclosure
cc: Kenneth O. Burris, Jr.
Regional Director
Region IV
Appeal Analysis
BACKGROUNDOn January 22, 2000, an ice storm struck the North Georgia Mountains and Gilmer County, knocking down trees and power lines. Debris was spread countywide over roads and properties. A disaster declaration for the County was issued January 27, 2000. As part of its cleanup effort, Gilmer County issued a request for proposals and on
March 17, 2000, selected Halls Tree Service, Inc. (Contractor) to collect eligible debris from County roads and right-of-ways. The final contract specified costs for each step of debris cleanup:
· $10 per cubic yard (CY) for debris to be picked up and hauled to a temporary debris storage and reduction site;
· $7 per cubic CY for processing (chipping or grinding) debris deposited at the reduction site by the contractor; and
· $7 per CY for processing (chipping or grinding) debris deposited at the reduction site by parties other than the contractor.
·
During the cleanup process the Contractor changed the debris removal procedure without an authorized change order in place. Instead of hauling the loose debris to the reduction site located at the landfill and reducing it via chipping there, as specified in the contract, the Contractor reduced the debris at the pickup sites prior to transporting it to the landfill, thereby substantially reducing the volume and number of truckloads needed to haul the debris. The change in procedure was not discovered by FEMA until closeout, when the number of truckloads appeared low in comparison to the number of cubic yards claimed.
Throughout the debris removal process, FEMA representatives explained to County officials that a conversion ratio of four to one could be applied to the amount of chipped debris in order to determine the quantities of loose debris hauled to and chipped at the reduction site located at the landfill. However, the applicability of this conversion factor was apparently misunderstood, because after completing debris clearance, the Contractor submitted a final bill of $994,814 for the hauling and chipping of debris. After reviewing the invoices at closeout it was discovered that the contractor charged Gilmer County for four times the number of truckloads it had actually hauled, applying the conversion ratio as if the Contractor had hauled loose, not chipped, debris. In the final Project Worksheet, FEMA disallowed $330,811 for the hauling of loose debris that was actually hauled as chipped debris.
First Appeal
Gilmer County appealed FEMAs determination in its letter of June 11, 2002. The County indicated that a number of Gilmer County representatives had met with FEMA representatives and discussed the method of billing, and per FEMAs direction, applied the four to one ratio to calculate hauled debris. The State transmitted Gilmer Countys first appeal on July 3, 2002, supporting the Countys appeal, stating that it would cause a tremendous hardship for the applicant. In the same letter the State also acknowledged once the documentation was submitted to the FEMA Project Officer, discrepancies were found in the reduction ratio commonly used for haul capacity for chipped debris versus loose debris.
FEMA denied the appeal on October 16, 2002, stating that the debris conversion calculation was incorrectly applied. The denial letter stated that the contract price was $10 CY of hauled material, regardless of whether it was chipped or loose debris.
Second Appeal
On March 6, 2003, the State transmitted Gilmer Countys second appeal dated
January 6, 2003. The County stated that it held a number of meetings with FEMA and State officials, and that both FEMA and State officials instructed that the removal of four cubic yards of loose debris was equal to one cubic yard of chipped debris. Upon those instructions eight invoices were submitted and approved, and that it was not until the final invoice was submitted that FEMA said that the four to one ratio was incorrect. The County submitted affidavits in support of its statement from three County officials and the Contractor.
The recollection of the discussion of the four to one ratio was consistent in three of the four affidavits. William Wright, who served as the Countys Emergency Management Director, in his affidavit indicated that the four to one ratio was repeatedly discussed, and it was not until FEMA examined the haul tickets in detail at the end of the project that the discrepancy was discovered. Danny R. Hall, President of Halls Tree Service, Inc. differed from the other statements by adding that, the compensation to be paid to Halls Tree Service, Inc. would be determined by the total number of cubic yards of whole debris (loose debris) delivered to the landfill.
The County contends that FEMAs representatives, cloaked with the authority of the agency, were aware of the four to one ratio being applied by Gilmer County. FEMAs position of denying further payment, we contend is unjustified since its agents participated in and even instructed the County to utilize a four to one ratio to determine the amount of debris to be billed. Furthermore, we contend that FEMAs approval and payment of eight periodic payments constitutes ratification of Gilmer Countys position.
DISCUSSION
The four to one conversion ratio is used to determine the volume of chipped debris for purposes of compensation from a known quantity of loose debris. However, the conversion ratio for loose debris hauled to resultant chipped debris no longer applied to the hauled debris, because it was already chipped when it was transported.
The issue regarding the application of the four to one ratio to the hauled debris was not identified by FEMA until after Gilmer County had already paid the Contractor. However, Gilmer County, not FEMA, was responsible for administering and monitoring the contract with Halls Tree Service, Inc. While, FEMA can approve changes in the Project Worksheet Scope of Work (e.g. resulting from increased amounts of debris), this was not the case with PW 204. Rather, FEMA made quarterly progress payments to the State for the eligible scope of work identified in the PW. During project closeout eligible costs are reconciled against the approved scope of work. It was at this time that FEMA discovered the discrepancy.
FEMA was not responsible for the administration of the contract with Halls Tree Service, Inc. and will not pay for work that was not performed. Whereas FEMA has the authority to assist State and local governments in disaster recovery and provides guidance for obtaining Federal assistance, FEMA does not have authority to direct contracts between another government entity and a private contractor. Nor was any FEMA official authorized to waive statutory and regulatory requirements. The Federal Government is not estopped by representations of FEMA officials that allegedly authorized applicants to expend FEMA funds in violation of the Stafford Act and the Public Assistance program regulations. Because the Contractors work was not in accordance with Gilmer Countys approved contract, under 44 CFR §13.43 (a)(2), Uniform Administrative Requirements for Grants and Cooperative Agreements to State and Local Governments, FEMA may, Disallow (that is, deny both use of funds and matching credit for) all or part of the cost of the activity or action not in compliance.
CONCLUSION
Gilmer County paid its contractor for four times the number of truck loads of debris actually hauled. FEMA cannot reimburse applicants for work that was not performed and work that was not in compliance with the contract in place between Gilmer County and the Contractor. Accordingly, there is no basis for granting the appeal. The appeal is denied.
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