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Time Limitations
Appeal Brief
Appeal Letter
Citation: FEMA-12465-DR-OK; City of Stroud, Project Worksheet (PW) 32
Cross-reference: Time Limitations
Summary: A tornado struck the City of Stroud (City) on May 9, 2003. As a result, the Federal Emergency Management Agency (FEMA) prepared PW 32 on
June 9, 2003, for $0 to repair damaged elements of a maintenance building. FEMAs estimate for repairs was $75,464. However, the City had insurance coverage for this work less a deductible of $1,000, which FEMA covered on PW 28. The City elected to demolish this building and erect a new, slightly larger structure, at the same location that would comply with current codes and standards without notifying FEMA or the Oklahoma Department of Emergency Management (OEM). The cost of the new 5,004 square foot building was $226,945, equating to a replacement cost of $181,645 for the original sized building. Dividing FEMAs estimate for repairs by the replacement cost of the original sized building yields a percentage of 41.5%, thus, replacement of the building does not qualify for reimbursement. On February 17, 2004, the City requested additional funding for constructing the building to code. OEM denied the Citys request on May 11, 2004, because the insurance coverage was greater than the funding that FEMA would authorize for an improved project and the request was not submitted within the sixty day timeframe allowed for identifying damages. The City submitted its first appeal on July 2, 2004, claiming that FEMAs estimate for repairs was too low and that its insurance estimate ($157,629) for repairs exceeds 50% of the insured value ($189,200). Also, it stated that negotiations with its insurance company delayed its ability to provide notice of additional costs sooner. The FEMA Region VI Acting Director denied the appeal on January 7, 2005, because the insurance proceeds were sufficient to cover the estimated cost to repair damages from the disaster, which did not exceed 50% of the replacement cost. Also, the elements requested for upgrade were not directly impacted by the event and the City did not meet the sixty day appeal deadline. The City submitted its second appeal on November 9, 2004, requesting reconsideration of FEMAs determination. OEM does not support the Citys appeal for $31,795.
Issues: Did the City comply with the sixty day timeframe to identify additional damages?
Findings: No. The Citys first substantive meeting was in May 2003, but it did not seek additional funding until February 2004, seven months past the deadline.
Rationale: 44 CFR §206.202(d)(ii)
Appeal Brief
| Disaster | FEMA-1465-DR |
| Applicant | City of Stroud |
| Appeal Type | Second |
| PA ID# | 081-71000-00 |
| PW ID# | 32 |
| Date Signed | 2005-04-07T04:00:00 |
June 9, 2003, for $0 to repair damaged elements of a maintenance building. FEMAs estimate for repairs was $75,464. However, the City had insurance coverage for this work less a deductible of $1,000, which FEMA covered on PW 28. The City elected to demolish this building and erect a new, slightly larger structure, at the same location that would comply with current codes and standards without notifying FEMA or the Oklahoma Department of Emergency Management (OEM). The cost of the new 5,004 square foot building was $226,945, equating to a replacement cost of $181,645 for the original sized building. Dividing FEMAs estimate for repairs by the replacement cost of the original sized building yields a percentage of 41.5%, thus, replacement of the building does not qualify for reimbursement. On February 17, 2004, the City requested additional funding for constructing the building to code. OEM denied the Citys request on May 11, 2004, because the insurance coverage was greater than the funding that FEMA would authorize for an improved project and the request was not submitted within the sixty day timeframe allowed for identifying damages. The City submitted its first appeal on July 2, 2004, claiming that FEMAs estimate for repairs was too low and that its insurance estimate ($157,629) for repairs exceeds 50% of the insured value ($189,200). Also, it stated that negotiations with its insurance company delayed its ability to provide notice of additional costs sooner. The FEMA Region VI Acting Director denied the appeal on January 7, 2005, because the insurance proceeds were sufficient to cover the estimated cost to repair damages from the disaster, which did not exceed 50% of the replacement cost. Also, the elements requested for upgrade were not directly impacted by the event and the City did not meet the sixty day appeal deadline. The City submitted its second appeal on November 9, 2004, requesting reconsideration of FEMAs determination. OEM does not support the Citys appeal for $31,795.
Appeal Letter
April 7, 2005
Mr. Albert Ashwood
Governors Authorized Representative
State of Oklahoma, Department of Emergency Management
Post Office Box 53365
Oklahoma City, Oklahoma 73152-3365
Re: Second Appeal City of Stroud, PA ID 081-71000-00, Time Limitations,
FEMA-1465-DR-OK, Project Worksheet (PW) 32
Dear Mr. Ashwood:
This is in response to your letter dated January 7, 2005, which transmitted the referenced second appeal on behalf of the City of Stroud (City). The Applicant is appealing the Federal Emergency Management Agencys (FEMAs) denial of additional funding for building code upgrades.
A tornado struck the City of Stroud (City) on May 9, 2003. As a result, the Federal Emergency Management Agency (FEMA) prepared PW 32 on June 9, 2003, for $0 to repair damaged elements of a maintenance building. FEMAs estimate for repairs was $75,464. However, the City had insurance coverage for this work less a deductible of $1,000, which FEMA covered on PW 28. The City elected to demolish this building and erect a new, slightly larger structure, at the same location that would comply with current codes and standards without notifying FEMA or the Oklahoma Department of Emergency Management (OEM). The cost of the new 5,004 square foot building was $226,945, equating to an actual replacement cost of $181,645 for the original sized building. On February 17, 2004, the City requested additional funding for constructing the building to code. OEM denied the Citys request on May 11, 2004, because the insurance coverage was greater than the funding that FEMA would authorize for an improved project and the request was not submitted within the sixty day timeframe allowed for identifying damages.
The City submitted its first appeal on July 2, 2004, claiming that FEMAs estimate for repairs was too low and that its insurance estimate ($157,629) for repairs exceeds 50% of the insured value ($189,200). Also, it stated that negotiations with its insurance company delayed its ability to provide notice of additional costs sooner. The FEMA Region VI Acting Regional Director denied the appeal on January 7, 2005, because the insurance proceeds were sufficient to cover the estimated cost to repair damages from the disaster, which did not exceed 50% of the replacement cost. Also, the elements requested for upgrade were not directly impacted by the event and the City did not meet the 60 day appeal deadline.
The City submitted its second appeal on November 9, 2004, requesting reconsideration of FEMAs determination. There seems to be some confusion by the City on FEMAs 50 Percent Rule. The rule defines repair cost as only those repairs associated with the damaged components. This cost does not include upgrades triggered by codes and standards, demolition, site work, or applicable project management costs, even though such costs may be eligible for public assistance. The City claimed its insurance settlement of $157,629 as its repair cost and, therefore, concluded that the replacement of the building was eligible for FEMA funding because it was greater than 50% of the insured value of $189,200. This is incorrect. Also, the rule defines replacement cost as the costs for all work necessary to provide a new facility of the same size or design capacity and function as the damaged facility in accordance with current codes and standards. It does not include demolition, site work, and applicable project management costs, even though these costs may be eligible for public assistance. Dividing FEMAs estimate for repairs by the actual replacement cost of the original sized building yields a percentage of 41.5%, thus, replacement of the building does not qualify for reimbursement.
Aside from the confusion over the 50 Percent Rule, I am denying the Citys second appeal because of its failure to comply with time limitations as defined in FEMA regulations.
44 CFR §206.202(d)(ii) states that the applicant will have 60 days following its first substantive meeting with FEMA to identify and to report damage to FEMA. The Citys first substantive meeting with FEMA was May 15, 2003. Therefore, the 60-day deadline for requesting additional funding was July 14, 2003. The City did not request the additional funding until February 17, 2004, seven months past the deadline.
Please inform the City of my decision. My determination constitutes the final decision on this matter as set forth in 44 CFR §206.206.
Sincerely,
/S/
Daniel A. Craig
Director
Recovery Division
Emergency Preparedness and Response
cc: Gary Jones
Acting Regional Director
FEMA, Region VI
Mr. Albert Ashwood
Governors Authorized Representative
State of Oklahoma, Department of Emergency Management
Post Office Box 53365
Oklahoma City, Oklahoma 73152-3365
Re: Second Appeal City of Stroud, PA ID 081-71000-00, Time Limitations,
FEMA-1465-DR-OK, Project Worksheet (PW) 32
Dear Mr. Ashwood:
This is in response to your letter dated January 7, 2005, which transmitted the referenced second appeal on behalf of the City of Stroud (City). The Applicant is appealing the Federal Emergency Management Agencys (FEMAs) denial of additional funding for building code upgrades.
A tornado struck the City of Stroud (City) on May 9, 2003. As a result, the Federal Emergency Management Agency (FEMA) prepared PW 32 on June 9, 2003, for $0 to repair damaged elements of a maintenance building. FEMAs estimate for repairs was $75,464. However, the City had insurance coverage for this work less a deductible of $1,000, which FEMA covered on PW 28. The City elected to demolish this building and erect a new, slightly larger structure, at the same location that would comply with current codes and standards without notifying FEMA or the Oklahoma Department of Emergency Management (OEM). The cost of the new 5,004 square foot building was $226,945, equating to an actual replacement cost of $181,645 for the original sized building. On February 17, 2004, the City requested additional funding for constructing the building to code. OEM denied the Citys request on May 11, 2004, because the insurance coverage was greater than the funding that FEMA would authorize for an improved project and the request was not submitted within the sixty day timeframe allowed for identifying damages.
The City submitted its first appeal on July 2, 2004, claiming that FEMAs estimate for repairs was too low and that its insurance estimate ($157,629) for repairs exceeds 50% of the insured value ($189,200). Also, it stated that negotiations with its insurance company delayed its ability to provide notice of additional costs sooner. The FEMA Region VI Acting Regional Director denied the appeal on January 7, 2005, because the insurance proceeds were sufficient to cover the estimated cost to repair damages from the disaster, which did not exceed 50% of the replacement cost. Also, the elements requested for upgrade were not directly impacted by the event and the City did not meet the 60 day appeal deadline.
The City submitted its second appeal on November 9, 2004, requesting reconsideration of FEMAs determination. There seems to be some confusion by the City on FEMAs 50 Percent Rule. The rule defines repair cost as only those repairs associated with the damaged components. This cost does not include upgrades triggered by codes and standards, demolition, site work, or applicable project management costs, even though such costs may be eligible for public assistance. The City claimed its insurance settlement of $157,629 as its repair cost and, therefore, concluded that the replacement of the building was eligible for FEMA funding because it was greater than 50% of the insured value of $189,200. This is incorrect. Also, the rule defines replacement cost as the costs for all work necessary to provide a new facility of the same size or design capacity and function as the damaged facility in accordance with current codes and standards. It does not include demolition, site work, and applicable project management costs, even though these costs may be eligible for public assistance. Dividing FEMAs estimate for repairs by the actual replacement cost of the original sized building yields a percentage of 41.5%, thus, replacement of the building does not qualify for reimbursement.
Aside from the confusion over the 50 Percent Rule, I am denying the Citys second appeal because of its failure to comply with time limitations as defined in FEMA regulations.
44 CFR §206.202(d)(ii) states that the applicant will have 60 days following its first substantive meeting with FEMA to identify and to report damage to FEMA. The Citys first substantive meeting with FEMA was May 15, 2003. Therefore, the 60-day deadline for requesting additional funding was July 14, 2003. The City did not request the additional funding until February 17, 2004, seven months past the deadline.
Please inform the City of my decision. My determination constitutes the final decision on this matter as set forth in 44 CFR §206.206.
Sincerely,
/S/
Daniel A. Craig
Director
Recovery Division
Emergency Preparedness and Response
cc: Gary Jones
Acting Regional Director
FEMA, Region VI