[Federal Register Volume 73, Number 227 (Monday, November 24, 2008)]
[Rules and Regulations]
[Pages 70894-70897]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-27839]
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DEPARTMENT OF HOMELAND SECURITY
Federal Emergency Management Agency
44 CFR Parts 206 and 207
[Docket ID: FEMA-2006-0035]
RIN 1660-AA21
Management Costs
AGENCY: Federal Emergency Management Agency, DHS.
ACTION: Notice of meeting and reopening of comment period.
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SUMMARY: The Federal Emergency Management Agency (FEMA) is announcing
the date, time, and location for a meeting regarding the Management
Costs Interim Rule (1660-AA21). This meeting will be open to the
public. FEMA also announces the reopening of the comment period for the
Management Costs Interim Rule.
DATES: Meeting Date: Wednesday, December 10, 2008, from 1 to 4 p.m.
e.s.t. Comment Date: The comment period for the interim final rule
published at 72 FR 57869, October 11, 2008, is reopened. Written
comments must be received by December 11, 2008.
ADDRESSES: The meeting will be held at 800 K Street, NW., 1st Floor,
North Tower, Washington, DC 20001. Individuals will be required to
present photo identification to enter the building in which the meeting
will be held. All written submissions must include the Docket ID FEMA-
2006-0035 and may be submitted by any one of the following methods:
Federal Rulemaking Portal: http://www.regulations.gov. Follow
instructions for submitting comments on the Web site.
E-mail: [email protected]. Include Docket ID FEMA-2006-0035 in the
subject line of the message.
Facsimile: (703) 483-2999.
Mail: Office of Chief Counsel, Federal Emergency Management Agency,
Room 835, 500 C Street, SW., Washington, DC 20472.
Hand Delivery/Courier: Office of the Chief Counsel, Federal
Emergency Management Agency, Room 835, 500 C Street, SW., Washington,
DC 20472.
FOR FURTHER INFORMATION CONTACT: Jennifer Cramer, Federal Emergency
Management Agency, 800 K Street, NW, Washington, DC 20472, telephone
202-786-9841.
SUPPLEMENTARY INFORMATION:
Background
Under the provisions of the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (Stafford Act), 42 U.S.C. 5121-5207, and its
implementing regulations, the Federal Emergency Management Agency
(FEMA) has the authority to assist State and local governments in
carrying out their responsibilities pursuant to a Presidentially
declared major disaster or emergency. Section 324 of the Stafford Act,
42 U.S.C. 5165b, required FEMA to establish management cost rates to be
used in determining contributions for management costs. Management
costs include any indirect cost, any administrative expense and any
other expense not directly chargeable to a specific project under a
major disaster, emergency, or disaster preparedness or mitigation
activity or measure.
On October 11, 2007, FEMA published an Interim Rule that proposed a
methodology for calculating the management cost rates, as well as
guidance for the implementation of section 324 of the Stafford Act (72
FR 57869). As established by the Interim Rule, management costs that
are reasonably incurred by a grantee or subgrantee in administering and
managing the Public Assistance (PA) program and the Hazard Mitigation
Grant Program (HMGP) grant award will be reimbursed up to a fixed rate.
The flat percentage rate for PA is 3.34 percent for major disaster
declarations, and 3.90 percent for emergencies. The HMGP rate is 4.89
percent for major disaster declarations. FEMA determined the rate for
management costs using a historical average of the Federal share of
actual administrative and management costs paid to grantees and
subgrantees. To calculate the figures in the Interim Rule, FEMA used
data collected in the National Emergency Management Information System
(NEMIS) for declarations from August 1998 to July 2004. FEMA did not
establish a percentage of management costs that grantees must pass
through to subgrantees.
FEMA initially held a 30-day comment period on the Interim Rule.
FEMA received 34 public comments, (all of which are available in the
docket for public inspection). On August 29, 2008 (73 FR 50881),
seeking specific data on unreimbursed eligible management costs, FEMA
reopened the Interim Rule for an additional 30-day comment period and
received an additional 37 comments, (which are also available in the
docket for public inspection). Some individuals who submitted comments
during the second
[[Page 70895]]
comment period, including a specific request from the Governors of
California, Florida, New York and Texas, asked to meet with FEMA to
discuss their concerns about the Interim Rule. In response to those
requests, FEMA has agreed to hold this public listening session in
which those affected by the rule may present their concerns orally.
FEMA has also opened the public comment period to the regulatory docket
to allow for the submission of additional written comments or data.
FEMA continues to review the written comments received during the first
two comment periods and will address those as well as any comments
received at the public meeting in the next rulemaking document
published for this project.
Additional Information
The data provided below is for informational purposes only. The
management cost rates published in the Interim Rule have not changed.
FEMA continues to evaluate data and the public comments received to
date as well as those that it expects to receive during the public
meeting. Any change to the management cost rates would occur through a
Second Interim Rule or a Final Rule that would be published in the
Federal Register.
In response to comments received on the Interim Rule, FEMA has been
recalculating the management cost rates using NEMIS data for all
declarations made before the date the Interim Rule went into effect
(November 13, 2007). FEMA chose to include only those declarations for
two reasons. First, after that date, grantees only received up to the
percentages established in the rule, which FEMA found could
artificially deflate the percentage, as they are capped at the 3.34/
3.90/4.89 percent rate (as appropriate). Second, under the Interim
Rule, final management cost amounts for disasters or emergencies do not
``lock in'' until 12 months after the disaster, so data compiled
earlier than 12 months would not represent final management cost
amounts. Further, because the first declaration under the Interim Rule
was declared November 30, 2007, none of those disasters has received
the full amount of management costs; obligations in NEMIS will only
reflect the initial 25 percent of eligible management costs provided to
grantees. Because management cost rates are calculated by using actual
obligations, including declarations affected by the Interim Rule at
this time would artificially decrease the average.
The data below represents the recalculated average rates. FEMA is
also conducting distributional analyses, however, that data is not yet
available for publication. The average rate data provided below
includes Hurricane Katrina (DR-1603-LA) data as a separate entry to
highlight how the percentage of management costs is affected in
extremely large disasters. Contrary to some of the comments received,
FEMA found that due to economies of scale or other factors, funds
obligated for management costs as a percentage of project dollars may
actually decrease for extremely large disasters. The data below
excludes the 9/11 World Trade Center attack (DR-1391-NY), because the
funds provided by FEMA for that particular disaster were specifically
mandated, accounted for separately, and obligated under different
eligibility criteria.
Although the Interim Rule did not establish a percentage of
management costs that must be passed through to subgrantees, FEMA
received several comments requesting that such a rate be set. The rates
below break out the average amount of management costs paid to
subgrantees. Again, this data is provided for informational purposes
only. These figures should not be used as mandatory or even suggested
pass through amounts.
Finally, the rate of management costs for HMGP funds associated
with Hurricane Katrina (DR-1603-LA) may appear inflated. This is
because the calculated rate as shown below is based on management costs
as a percentage of project funds obligated to date, not as a percentage
of the total amount of HMGP funds available to the State
($1,333,208,000). As of the date of this analysis, only approximately
15 percent of the estimated available project funds have been
obligated, while the management costs obligated to date are reflective
of the level of effort necessary to manage the entire program.
Management costs are often obligated faster than project dollars in the
HMGP.
Management and Administrative Funds Paid as a Percentage of Project Funds
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NEMIS state NEMIS
management NEMIS grantee subgrantee Total MC
NEMIS project obligations obligations obligations grantee & subg
obligations (``category (``sliding (``sliding (Cat Z +
Z'') scale'') scale'') sliding scale)
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Public Assistance--Major Disasters
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All NEMIS Pre Sec 324 \2\ Less 22,870,296,549.. 328,235,854 129,056,414 264,930,091 720,316,814
1391 \1\.
3.15% Total MC.
2.00% Grantee..
1.16%
Subgrantee.
DR 1603 LA.................... 6,610,259,454... 70,390,092 33,283,020 39,144,562 142,817,674
2.16% Total MC.
1.57% Grantee..
0.59%
Subgrantee.
All NEMIS Pre Sec 324 Less 16,260,037,094.. 257,845,763 95,773,394 225,785,529 577,499,140
1391, 1603.
3.55% Total MC.
2.17% Grantee..
1.39%
Subgrantee.
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Hazard Mitigation--Major Disasters
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NEMIS
NEMIS state NEMIS grantee subgrantee Total MC
NEMIS project management obligations obligations grantee & subg
obligations obligations (``sliding (``sliding (SMC +
(SMC) scale'') scale'') sliding scale)
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All NEMIS Pre Sec 324 Less 2,080,757,726... 65,786,946 16,335,829 37,275,104 119,154,832
1391.
[[Page 70896]]
5.73% MC.......
3.95% Grantee..
1.79%
Subgrantee.
DR 1603 LA.................... 200,003,640..... 10,795,418 1,051,543 3,104,886 14,951,847
7.48% Total MC.
5.92% Grantee..
1.55%
Subgrantee.
All NEMIS Pre Sec 324 Less 1,880,754,086... 54,991,528 15,284,286 34,170,218 104,202,985
1391, 1603.
5.54% Total MC.
3.74% Grantee..
1.82%
Subgrantee.
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Public Assistance--Emergencies
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NEMIS state NEMIS
management NEMIS grantee subgrantee Total MC
NEMIS project obligations obligations obligations grantee & subg
obligations (``category (``sliding (``sliding (Cat Z +
Z'') scale'') scale'') sliding scale)
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All NEMIS Pre Sec 324......... 1,458,597,114... 6,187,426 10,690,782 25,095,074 41,973,281
2.88% MC.......
1.16% Grantee..
1.72%
Subgrantee .
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\1\ DR-1391-NY (World Trade Center) excluded because eligibility and source and accounting of funds were treated
differently than Stafford Act/Disaster Relief Fund declarations.
\2\ All declarations declared between 8/26/1998 and 11/12/2007; obligations as of 10/1/2008.
As stated above, NEMIS was used to generate the data in the table
which reflects the Federal share of actual administrative and
management costs paid to grantees and subgrantees. If grantees or
subgrantees have incurred management costs (as defined by section 324
of the Stafford Act (42 U.S.C. 5165b)) that were not reimbursed, please
submit those costs to the docket during this open comment period. FEMA
needs actual cost data to support a rate, and encourages grantees and
subgrantees to submit actual unreimbursed cost data. FEMA requested
this data during the second Interim Rule comment period, but in some
cases received percentage rates for management costs incurred for
disasters rather than actual cost data. FEMA has data showing the
amount of management costs that were actually paid to grantees and
subgrantees. FEMA requests that grantees and subgrantees submit to the
docket any actual costs incurred that were not reimbursed, but would
have been eligible; for example, sliding scale limitations in section
406 of the Stafford Act. For example:
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Disaster No. Explanation of cost Amount
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DR-9999-XX....................... Travel costs incurred $5,127.00
for field inspections
that exceeded available
sliding scale.
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Unreimbursed costs might include items eligible for sliding scale
funds when such funds were insufficient, or subgrantee costs not
eligible for sliding scale funds and therefore not eligible for FEMA
reimbursement. Unreimbursed costs must have been incurred in support of
the management and administration of PA or HMGP under a specific
Presidential declaration (major disaster or emergency for PA or major
disaster for HMGP), and not in support of other programs such as
community relations or Disaster Recovery Center staff, or staff
supporting Individual Assistance programs. Unreimbursed costs do not
include State cost shares required for sliding scale, Category Z, or
indirect cost funding, nor do they include costs that were not
reimbursed because they were inconsistent with applicable Federal rules
and cost principles, such as OMB Circular No. A-87.
Public Meeting
The December 10, 2008 meeting is open to the public and will begin
at 1 p.m. e.s.t. To enter the 800 K Street, NW., 1st Floor, North
Tower, Washington, DC 20001 facility in which the meeting will be held,
members of the public will be required to present photo identification.
The meeting will be held in the 1st Floor Conference Center. Please
note that the meeting may close early if all persons who wish to
comment have done so. Persons with disabilities who require special
assistance should advise Jennifer Cramer (contact information provided
above in the ADDRESSES section) of their anticipated special needs as
early as possible. Members of the public who wish to make comments must
be present and seated by 1 p.m. e.s.t.
Those who are unable to attend or speak at the meeting may submit
written comments. Written comments must be received by December 11,
2008. All submissions received must include the Docket ID FEMA-2006-
0035 and may be submitted by any one of the methods listed in the
ADDRESSES section above. A summary of the comments received at the
public meeting will be posted to the docket at www.regulations.gov.
Instructions for Submitting Information to the Docket
For access to the docket to submit comments, read the Notice of
Proposed Rulemaking, Interim Rule, background
[[Page 70897]]
documents and all comments received, go to the Federal eRulemaking
Portal at http://www.regulations.gov. To the far right is a section
titled ``More Search Options.'' Below that title, click on ``Advanced
Docket Search.'' On the next screen, in the box provided for Docket ID,
type ``FEMA-2006-0035''. The next screen will provide a link to the
docket. Once viewing the docket, all documents are provided in
chronological order, beginning with the 2002 Notice of Proposed
Rulemaking.
All Submissions received must include the agency name and Docket
ID. Regardless of the method used for submitting comments or supporting
material, all submissions will be posted, without change, to the
Federal eRulemaking Portal at http://www.regulations.gov, and will
include any personal information you provide. Therefore, submitting
this information makes it public. You may wish to read the Privacy Act
notice that is available on the Privacy and Use Notice link on the
Administration Navigation Bar of http://www.regulations.gov.
Dated: November 18, 2008.
R. David Paulison,
Administrator, Federal Emergency Management Agency.
[FR Doc. E8-27839 Filed 11-21-08; 8:45 am]
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