Immediate Threat, Force Account Labor & Equipment Costs

Appeal Brief

Summary Paragraph

The City of Biloxi (Applicant) requested Public Assistance (PA) for various costs incurred in response to the coronavirus (COVID-19) pandemic, including force account labor (FAL) overtime (OT) for police and fire personnel and city employees, force account equipment (FAE) for police and fire vehicles, materials, meals, legal services, and COVID-19 healthcare reimbursement. FEMA prepared Grants Manager Project 151614 to document the Applicant’s claimed costs. On November 13, 2020, FEMA issued a Request for Information requesting explanations for how the Applicant’s costs correlated to COVID-19 specific activities. The Applicant responded that personnel worked extended hours responding to emergency calls and performing various other emergency work. FEMA issued a Determination Memorandum, awarding $104,118.66 for COVID-19 employee testing and personal protective equipment and denying the remaining costs. FEMA determined that the Applicant did not demonstrate through documentation that the denied costs were related to eligible emergency services for the declared COVID-19 event. The Applicant submitted its first appeal, seeking $1,353,336.96 of the costs denied for FAL, FAE, materials, meals, and legal and medical services. The FEMA Region 4 Regional Administrator partially granted the Applicant’s first appeal awarding $4,914.87 for disinfection equipment and health and safety messaging and denying $1,348,422.09, as it found that the Applicant had not substantiated through documentation that the claimed denied costs were incurred in response to eligible emergency protective measures. The Applicant filed a second appeal, reiterating first appeal arguments. FEMA finds that the Applicant has not demonstrated that its costs claimed were associated with eligible emergency protective measures taken in response to the COVID-19 pandemic.
 

Authorities

• Stafford Act §§ 403, 502.
• 2 C.F.R. § 200.403(g)
• 44 C.F.R. §§ 206.206(a), 206.221(e)(5), 206.223(a)(1), 206.225(a), 206.228(a)(1) 206.228(a)(2)(iii).
• PAPPG,at 19, 21, 23-26 57, 58, 63-65, 133.
• FP 104-21-0003 at 5, FP 104-21-0004 at 2-5, 104-009-19.
• City of De Witt, FEMA-4483-DR-LA, at 2; Franciscan Alliance, Inc., FEMA-4489-DR-IL, at 2-3 City of Kingsland, FEMA 4501-DR-GA, at 2; Williamson (County), FEMA-4489-DR-IL, at 2.

Headnotes

• To be eligible, costs must be directly tied to the performance of eligible work.
  • The Applicant has not substantiated that the costs are directly tied to eligible emergency protective measures in response to the declared incident.

Conclusion

FEMA finds that the Applicant has not demonstrated that its claimed costs were associated with eligible emergency protective measures in response to the COVID-19 pandemic. Therefore, this appeal is denied.

Appeal Letter

Appeal Analysis

Background

The coronavirus (COVID-19) pandemic resulted in a major disaster declaration for the state of Mississippi with an incident period of January 20, 2020, to May 11, 2023.[1] The City of Biloxi (Applicant) requested reimbursement under FEMA’s Public Assistance (PA) program for costs incurred in responding to the COVID-19 pandemic. FEMA prepared Grants Manager Project (GMP) 151614 to document the Applicant’s total claimed costs of $1,783,481.29.[2] The Applicant claimed:

• $1,111,258.60 for force account labor overtime (FAL OT) for police, fire, and city personnel;[3]
• $121,665.65 for force account equipment (FAE) for police patrol vehicles and fire emergency response vehicles (engines and ambulances);
• $105,616.78 for materials including, reopening guideline flyers, first responder thank-you videos, virtual meeting software, temporary orange roll barriers, disinfection equipment for emergency vehicles, and air purifiers with high efficiency particulate air filters;
• $4,500.00 in contract costs for COVID-19 employee testing;
• $14,404.24 for employees’ meals;
• $100,533.02 in costs associated with: (1) legal services provided to the Applicant (i.e., an attorney reviewed COVID-19-related proclamations and other orders to ensure the Applicant complied with applicable authorities); and (2) reimbursement to Blue Cross Blue Shield of Mississippi (BCBS) for their payments of COVID-19-related healthcare claims (e.g., COVID-19 claims related to treatment at hospitals and physicians’ offices, as well as COVID-19 testing claims) and administration services;[4] and
• $325,503.00 in what the Applicant termed would be “future” costs from July 2020 through the remainder of 2020.

On November 13, 2020, FEMA issued a Request for Information requesting explanations for how the Applicant’s work and costs correlated to COVID-19 specific activities. The Applicant responded on November 25, 2020, stating it had declared a 21-day citywide emergency shutdown at the start of the pandemic, which included administrative leave for its FAL intended to achieve social distancing. The Applicant also stated that essential employees from various municipal departments were called back to provide essential services, and police were utilized to enforce citywide health and safety measures implemented during the shutdown.

On February 25, 2022, FEMA issued a Determination Memorandum approving $104,118.66 for COVID-19 employee testing[5] and personal protective equipment but denying the remaining $1,679,362.63. FEMA determined that the Applicant did not demonstrate that the majority of costs were related to the performance of eligible emergency work.

First Appeal 

In a letter dated March 29, 2022, the Applicant submitted its first appeal, seeking $1,353,336.96 denied in FAL, FAE, materials, meals, and legal and medical services.[6] The Applicant reiterated that the FAL OT for emergency services personnel and called back staff, as well as claimed costs for fire and police FAE, were incurred for work that was related to eligible emergency protective measures. The Applicant also stated that the: (1) materials (e.g., disinfection items, flyers that provided guidelines for reopening facilities, and virtual meeting software) were necessary to enforce disinfection and social distancing measures; (2) meals were necessary due to abnormal working hours for personnel and limited food availability; (3) fees for legal services were necessary to ensure compliance with COVID-19 proclamations; and (4) costs to BCBS for claims administered and processed by BCBS were for healthcare claims made by Applicant-personnel and reimbursed through the Applicant’s self-insurance fund.

In a decision dated July 6, 2023, the FEMA Region 4 Regional Administrator partially granted the Applicant’s appeal, approving $4,914.87 associated with disinfection measures and reopening guideline flyers. FEMA denied the remaining $1,348,422.09, finding that the Applicant had not substantiated the costs incurred for FAL OT, FAE for fire and police vehicles, the remaining materials, meals, and costs for legal services and BCBS claims were associated with emergency protective measures performed in response to COVID-19.

Second Appeal

The Applicant’s September 5, 2023 second appeal reiterates prior arguments and requests the previously denied funding.[7] The Applicant also attaches time sheets and Incident Command System logs for the fire department during the incident period. The Recipient forwarded the appeal, in a letter dated September 7, 2023, supporting the Applicant’s position.

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 include training specific to the declared event; technical assistance to state, local, tribal and territorial (SLTT) governments on emergency management and control of immediate threats to public health and safety; law enforcement; and eligible medical care activities and associated costs in primary medical care facilities including emergency and inpatient clinical care for COVID-19 patients.^[10] Under limited circumstances, the provision of meals for employees and volunteers engaged in eligible emergency work may be eligible, provided certain conditions are met.^[11]

FEMA may also provide assistance for measures implemented to facilitate the safe opening and operation of an eligible facility in response to the COVID-19 pandemic.^[12] Such assistance is limited to the purchase and distribution of face masks and personal protective equipment, cleaning and disinfection, COVID-19 diagnostic testing, screening and temperature scanning, and purchase and installation of temporary physical barriers.^[13] 

Costs must be directly tied to the performance of eligible work and adequately documented.[14]

i. Legal Services and BCBS

The Applicant requests reimbursement of legal services’ costs for an attorney who reviewed government proclamations and orders pertaining to COVID-19 to ensure the Applicant’s legal compliance with applicable authorities. However, the Applicant has not demonstrated that these costs are directly tied to eligible training or technical assistance on emergency management and control of immediate threats to public health and safety. In addition, the Applicant has not shown the costs are directly tied to eligible emergency protective measures implemented to facilitate the safe opening and operation of an eligible facility in response to the COVID-19 pandemic, nor any eligible emergency protective measures included under FEMA’s COVID-19 policies, or comparable activity, that eliminates or lessens an immediate threat.[15] Therefore, the cost claimed for legal services are ineligible for PA funding.

The Applicant also requests costs associated with payments to BCBS for COVID-19-related medical claims of its employees and certain BCBS administrative services fees. However, the Applicant’s documentation does not demonstrate that these costs are tied to eligible work performed by the Applicant. Rather, the Applicant’s documentation shows the Applicant’s claim is for its payment, as a self-insurer, for medical care treatment someone else provided to its employees and the costs to process those claims. Payment of employee healthcare and claims under the plans the Applicant offered to its employees and associated administrative costs is not an eligible emergency protective measure under FEMA’s Medical Care Policy or any other FEMA COVID-19 policy.[16] 

ii. Meals

While the Applicant’s documentation shows it provided meals to employees, the documentation does not demonstrate that the meals were provided to employees conducting eligible emergency work. Rather, the Applicant submitted an invoice for a bulk meal order from an event that was cancelled, which does not establish the claimed costs as directly tied to eligible emergency work in response to COVID-19. Additionally, although the Applicant alternatively asserts some of the costs may be eligible as part of OT-related costs, the costs are similarly not eligible under that classification as the Applicant has not demonstrated the FAL associated with the claimed costs was performing eligible work, discussed in more detail to follow. Therefore, the costs for the meals are ineligible for PA funding. 

iii. Materials

The Applicant requests costs for the purchase of virtual meeting software, stating the purchase was necessary to facilitate social distancing in its facility to reduce the spread of COVID-19 while also enabling it to comply with state and local executive orders and continue to provide essential government services. However, the Applicant has not demonstrated the costs are eligible under any of the specific categories listed within FEMA’s COVID-19 Safe Opening and Operation policy or any comparable activity that eliminates or lessens an immediate threat.^[17] Rather the documents show these costs were incurred to enable the Applicant to conduct routine, non-emergency work, and provide government services in a COVID-19 environment. Therefore, the costs claimed for the virtual meeting software are ineligible for PA funding. 

Force Account Labor & Equipment Costs

For emergency work, generally only overtime labor costs for budgeted employees are eligible.[18] FEMA determines the eligibility of overtime, premium pay, and compensatory time costs based on the Applicant’s predisaster written labor policy, if certain criteria are met.[19] FEMA may provide PA funding for ownership and operation costs Applicant-owned equipment used to perform eligible work (FAE), based on hourly rates.[20]Documentation should provide the “who, what, when, where, why, and how much” for each item claimed.[21]

Although the Applicant requests costs for FAL OT for fire and police personnel, the fire department call logs, as well as the police logs provided, do not offer any specific description of what activities the claimed work entailed to enable FEMA to distinguish between routine calls and potentially eligible emergency protective measures specifically related to the COVID-19 pandemic. The Applicant acknowledges that much of the information to differentiate these routine calls from COVID-19 specific calls was missing from the documentation.[22] Similarly, although the Applicant states it called back employees who then performed eligible work to ensure public health and safety, the documentation provided lacks detail to identify what work activities were conducted by those personnel. For example, the cost summary submitted does not have specific detail to identify the employee’s tasks/activities as emergency protective measures, and instead has general descriptions of work (e.g., essential operations and citizen services).[23] Accordingly, the Applicant has not substantiated that the FAL OT costs for police, fire, and called back employees, are directly tied to eligible emergency protective measures performed in response to the COVID-19 pandemic.

Likewise, the Applicant’s documentation provided to support its FAE claim does not demonstrate that the claimed use of police and fire vehicles is directly tied to eligible emergency protectives performed in response to the COVID-19 pandemic. Rather, the documentation shows the vehicles were utilized for normal law enforcement and emergency response activities tied to routine calls. Therefore, the costs claimed for FAE are not eligible for PA funding.

Conclusion

The Applicant has not demonstrated that its claimed costs were associated with eligible emergency protective measures in response to the COVID-19 pandemic. Therefore, this appeal is denied.