Time & Material Contract

January 6, 2009

W. Craig Fugate
Director
State of Florida
Division of Emergency Management
2555 Shumard Oak Boulevard
Tallahassee, Florida 32399

Re: Second Appeal–City of Fort Meyers, PA ID 071-24125-00, Time & Material Contract,
FEMA-1539-DR-FL, Project Worksheet (PW) 6333

Dear Mr. Fugate:

This letter is in response to your letter dated June 19, 2008, which transmitted the referenced second appeal on behalf of the City of Fort Meyers (Applicant). The Applicant is appealing the Department of Homeland Security’s Federal Emergency Management Agency’s (FEMA) de-obligation of $168,596 for work completed under a time-and-material (T&M) contract beyond the allowable 70-hour work period.

FEMA prepared PW 6333 for $367,299 for debris removal from the Applicant’s rights-of-way (ROWs) and other public property. The Applicant used a T&M contract to remove the debris for over one and one-half months. At final inspection, FEMA de-obligated $168,596 because the time period of the work performed under the T&M contract was in excess of the allowable 70-hour time limit. In addition, FEMA could not determine the reasonableness of the costs the Applicant incurred beyond the 70-hour limit.

The State submitted the Applicant’s first appeal to FEMA eight months after regulatory deadline. The Regional Administrator denied the appeal because the State did not submit the appeal within the regulatory timeframe specified in 44 CFR §206.206(c). Therefore, the Regional Administrator did not evaluate the merits of the appeal.
The Applicant submitted its second appeal on April 17, 2008. The Applicant maintains that (1) the debris removal work performed in parks and on golf courses necessitated the use of a T&M contract, and that the “cubic yard/truckload ticket approach [was] not practical”; (2) FEMA policy allows exceptions to the 70-hour time limitation for work in which a clear scope of work cannot be developed; and (3) the “cost for the services in relationship to the need for those services were [sic] fair.” The State forwarded the appeal on June 19, 2008 and supports the Applicant’s request.

The Debris Management Guide, FEMA 325, April 1999 states:

Time-and-Material contracts should be limited to a maximum of 70 hours of actual emergency debris clearance work and should be used only after all available local, tribal and State government equipment has been committed. Time-and-Material contracts for debris clearing, hauling, and/or disposal should be terminated once the designated not-to-exceed number of hours is reached. On occasion, Time-and-Material contracts may be extended for a short period when absolutely necessary, for example, until appropriate Unit Price contracts have been prepared and executed.

T&M contracts may be appropriate beyond the initial 70-hour, provided that Applicant appropriately monitors the work. The Applicant did not provide any documentation to show that it appropriately monitored the contractor, or any other information that would allow FEMA to evaluate the reasonableness of the costs incurred after the initial 70-hour time period.

Based on these facts and the information submitted with the appeal, I have determined that the Applicant has not shown that the costs it incurred under the T&M contract were reasonable. Therefore, I am denying the second appeal.

Please inform the Applicant of my decision. This determination is the final decision on this matter pursuant to 44 CFR §206.206.

Sincerely,
/s/
Carlos J. Castillo
Assistant Administrator
Disaster Assistance Directorate

cc: Major Phil May
Regional Administrator
FEMA Region IV