Disposition of Equipment

Citation:  FEMA-1763-DR-IA, Mahaska County Emergency Management Agency, Disposition of Equipment Project Worksheet (PW) 565

Cross-
Reference:  Equipment and Supplies

Summary:  The Applicant purchased equipment and supplies in response to widespread flooding in Mahaska County from June 1 through August 31, 2010.  FEMA prepared PW 565 in the amount of $39,166 for force account labor and equipment and supplies.  FEMA determined, pursuant to 44 Code of Federal Regulations (CFR) §13.32(e)(2), Equipment, Disposition, and 44 CFR §13.33(b), Supplies, Disposition, that the Applicant was required to compensate FEMA for the fair market residual value of used and unused equipment and supplies with an aggregate value exceeding $5,000.  Therefore, $24,695 was deducted from the eligible costs for equipment and supplies, and on January 26, 2011, PW 565 was obligated for $14,471.

The Applicant submitted a first appeal on February 24, 2011, disputing FEMA’s decision to reduce the eligible costs for emergency equipment and supplies.  Support documentation included invoices, detailed descriptions of the purchased items and explanations of how the items were used in the emergency response operation.  On December 7, 2011, the Regional Administrator responded to the first appeal and determined that the deduction was only required for the boat and motor purchase.  The Regional Administrator explained that the boat and motor were purchased together and used together in function in the same way as an automobile.  A deduction amount of $6,980 was calculated on the $8,085 purchase price of the boat and motor.  All other equipment and supply costs were reimbursed resulting in an additional $17,715 in funding.

The Applicant submitted a second appeal, which was forwarded to FEMA from the State on March 20, 2012.  The Applicant disagrees with FEMA’s comparison of the boat and motor to a motorized vehicle and requests reinstatement of the $6,980 reduction.

Issue:  Are the items in dispute separate purchases with a current per-unit fair market    value of less than $5,000?

Finding:  Yes.
 
Rationale:  44 CFR §13.32(e)(1), Equipment, Disposition; FEMA DAP9525.12, Disposition of Equipment, Supplies and Salvageable Materials.