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Disaster Recovery Briefs

A timely commentary on developments and decisions affecting federal disaster assistance.

The availability of federal financial assistance depends on whether an applicant meets statutory, regulatory, and programmatic requirements. These requirements are informed by the interpretations of various entities, including the awarding agency (e.g., FEMA, HUD, Treasury), the Office of Inspector General, and judicial bodies that decide disputes, like Federal Courts and the Civilian Board of Contract Appeals which hears arbitrations of FEMA decisions. Through Disaster Recovery Briefs, Baker Donelson's Disaster Recovery Team provides timely analysis of guidance, reports, and decisions that impact the availability and provision of federal financial assistance, like FEMA Public Assistance, HUD Community Development Block Grants, and funding under the CARES Act Coronavirus Relief Fund, and American Rescue Plan Fiscal Recovery Funds, among others.

June 2021

June 2

  • FEMA Applicants and American Rescue Plan Fiscal Recovery Fund Recipients Should Know About Updates to Procurement Requirements
    Entities that enter into contracts funded by federal grants like FEMA's Public Assistance program or the Coronavirus State and Local Fiscal Recovery Funds under the American Rescue Plan, must ensure their procurements and contracts meet the requirements of 2 C.F.R. Part 200, also referred to as the "Uniform Rules." Last fall, the Office of Management and Budget revised 2 C.F.R. Part 200, including the procurement standards. These updates apply to awards made or disasters declared after November 12, 2020, although a few provisions are retroactive to August 13, 2020.
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June 2

  • OIG Reports Lessons Learned from the CARES Act and Advises on American Rescue Plan
    Last year, the CARES Act Authorized the U.S. Department of the Treasury (Treasury) to make $150 billion payments to state, local, territorial, and tribal governments from the Coronavirus Relief Fund (CRF). Treasury issued guidance on how the funds could be spent, but recipients were not required to sign assistance agreements and funds were not considered by the agency to be "grants" subject to most of the requirements of 2 C.F.R. Part 200, the Uniform Administrative requirements, Cost Principles, and Audit Requirements for Federal Awards. With enactment of the American Rescue Plan Act (ARP), Treasury is now poised to pay $350 billion to state, local, territorial, and tribal governments from the Coronavirus State and Local Fiscal Recovery Funds (FRF). On May 17, 2021, the Department of the Treasury Office of Inspector General (OIG) issued a Memorandum entitled American Rescue Plan – Application of Lessons Learned from the Coronavirus Relief Fund, recommending that Treasury implement additional controls as it provides ARP relief.
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May 2021

May 12

  • BREAKING: Treasury Releases Guidance for Coronavirus State and Local Fiscal Recovery Fund
    This week, the U.S. Department of the Treasury announced the launch of the Coronavirus State and Local Fiscal Recovery Fund, established by the American Rescue Plan Act of 2021, to provide $350 billion in emergency funding for eligible state, local, territorial, and Tribal governments. According to Treasury's statement accompanying its launch of the program and release of related guidance, the intent is that these funds will "provide a substantial infusion of resources to help turn the tide on the pandemic, address its economic fallout, and lay the foundation for a strong and equitable recovery."
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May 3

  • American Rescue Plan: Treasury Coronavirus State and Local Fiscal Recovery Fund
    All eyes are on the U.S. Department of the Treasury as we quickly approach the deadline for distribution of the first tranche of the $350 billion provided under the American Rescue Plan Act for what has been dubbed the State and Local Fiscal Recovery Fund.
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April 2021

April 27

  • FEMA Seeks Public Comments on Future Program Delivery by June 21
    On April 22, FEMA released a request for information to the public seeking comments on specific FEMA programs, regulations, collections of information, and policies for the agency to consider in light of recent Executive Orders. All comments should be submitted by Monday, June 21.
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April 24

  • BREAKING: SBA Now Advises Shuttered Venue Operator Grant to Re-Open Monday, April 26
    In response to stakeholder feedback about reopening the Shuttered Venue Operators Grant application this weekend, the U.S. Small Business Administration has now advised that the application portal will re-open Monday, April 26, 2021 at 12:00 p.m. EDT.
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April 22

  • CBCA Decision – CBCA Strictly Enforces Arbitration Filing Deadlines Under the 2018 Disaster Recovery Reform Act
    Section 1219 of the Disaster Recovery Reform Act of 2018 (DRRA) permits FEMA Public Assistance applicants to pursue binding arbitration to resolve funding disputes with FEMA. The agency has published a Fact Sheet to provide guidance on the process to request arbitration under the DRRA. Eligible applicants must meet the following three criteria to seek arbitration.
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April 6

  • FEMA Fact Sheet: Audit-Related Guidance for Entities Receiving FEMA Public Assistance Funds
    The Federal Emergency Management Agency (FEMA) recently released a Fact Sheet to help entities that have received, or expect to receive, funding under FEMA's Public Assistance program properly account for and document their eligible costs. FEMA's guidance comes at a critical point in response to the ongoing COVID-19 pandemic, as many entities are now working to re-open and determining whether they may be eligible to submit some of the resulting increased costs to FEMA for reimbursement. The Fact Sheet includes specific recommendations and "Audit Tips" for managing COVID-19-related project costs.
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March 2021

March 26

  • OIG Again Pressures FEMA to Enforce Procurement Rules
    In 2016, the U.S. Department of Homeland Security Office of Inspector General (the "OIG") issued a report entitled "FEMA Can Do More to Improve Public Assistance Grantees' and Subgrantee's Compliance with Federal Procurement Rules." Therein, the OIG noted that over a six year period it had questioned $352.3 million in grant costs due to procurement non-compliance, but that FEMA had subsequently determined 91.3% of those questions costs eligible, often because FEMA excused noncompliance where it deemed costs reasonable. The OIG warned FEMA's enforcement of Federal regulations would fall short, without "financial consequences for noncompliance", including taking money back from grantees and subgrantees.
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March 19

  • American Rescue Plan: OMB Memo Gives Insight into Oversight and Compliance Requirements Applicable to Funds
    The Acting Director of the Office of Management and Budget (OMB) has issued a guidance memorandum to all executive departments and agency heads to emphasize the importance of accountability and transparency of federal government spending with respect to assistance provided under the American Rescue Plan Act of 2021 (ARP). OMB's memo, referenced as M-21-20, also imparts a duty to all agencies to maintain effective stewardship of these funds, which includes supporting all Americans, and as such, requires advancing racial equity and supporting underserved communities across our country.
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January 2021

January 8

  • Treasury Releases Information on New Emergency Rental Assistance Program: Opt-in by January 12 Deadline
    The U.S. Department of the Treasury just released details of a new Emergency Rental Assistance Program, including a list of eligible recipients for the $25 billion in funding, pursuant to Title V, Section 501, of the Consolidated Appropriations Act of 2021. Treasury must provide funding to any eligible recipients within 30 days of enactment, or by January 26, 2021, so states and local governments that are eligible – and willing – to participate will receive funding quickly and must be ready to begin distributing payments to qualified renters, landlords, and utilities.
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January 5

  • New Grant Opportunity for Venue Operators Impacted by the Pandemic
    After much anticipation, the Consolidated Appropriations Act of 2021 was signed into law on December 27, 2020. While funding for vaccination support, the fate of stimulus checks to individuals, and support (or lack thereof) for state and local governments garnered a great deal of attention, there are many different programs and funding streams included within the 5,593-page package. One such new and notable program will provide $15 billion in funding to eligible "shuttered venue operators" in the form of grants administered through the U.S. Small Business Administration.
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January 4

  • FEMA Seeks Comment on Proposed Change to Disaster Declaration Criteria
    Just before the holidays, FEMA published an 86-page notice of proposed rulemaking in the Federal Register regarding a change to the "Estimated cost of the assistance" disaster declaration factor that FEMA uses to review a Governor's request for a major disaster under the Public Assistance Program. Any comments to the proposed rule must be submitted by February 12, 2021.
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December 2020

December 31

  • CBCA 6822-FEMA; In the Matter of FLORIDA KEYS ELECTRIC COOPERATIVE Emergency Procurement; Reasonable Costs
    Documentation Critical to Florida Utility's FEMA Reimbursement Arbitration
    A Panel consisting of Judges Beardsley, Drummond, and Russell has determined the Florida Keys Electric Cooperative is entitled to partial reimbursement of its costs incurred to establish two full-service base camps to support recovery and power restoration efforts immediately following Hurricane Irma in 2017. Based on data included in the Decision, the Cooperative will recover approximately 84 percent of the costs incurred, compared to a full denial going into the arbitration and a subsequent determination by FEM that approximately 20 percent of the costs were eligible.
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December 28

  • Changes to the FEMA Public Assistance Program and Policy Guide: Remedies for Procurement Noncompliance
    The latest version of FEMA's Public Assistance Program and Policy Guide (PAPPG), applicable to incidents declared on or after June 1, 2020, removes language that existed in prior versions confirming FEMA's policy to approve the reasonable cost of eligible work in the case of noncompliance with federal procurement requirements. This change gives FEMA greater latitude to impose harsh penalties, including denial of all contract costs, and indicates FEMA may be doubling down on its propensity to impose strict compliance with these requirements following recent disasters.
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December 4

  • FEMA Seeks Comment on Revised Policy Implementing Stafford Act Section 705
    On October 10, 2020, FEMA published a proposed revision to its existing policy for implementation of Stafford Act § 705, Disaster Grant Closeout Procedures. FEMA seeks comment on the proposed policy by December 10, 2020. Stafford Act § 705 has two subsections that give important rights to applicants and thereby limit FEMA's broad discretionary authority in the administration of disaster assistance funding. These provisions have created opportunities for applicants facing deobligation to successfully retain previously awarded funds and thus FEMA's policy to implement them should be of significant interest to disaster-prone state, tribal, and local governments.
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October 2020

October 30

  • CBCA Panel Denies Florida Utility's Arbitration Request
    A Panel consisting of Judges Vergilio, Goodman, and Kullberg has denied a request for arbitration filed by St. John's River Utility, Inc. of Florida regarding its claim for assistance following Hurricane Irma in 2017. The Panel determined that the grantee, the Florida Division of Emergency Management (FDEM), untimely submitted St. John's Request for Public Assistance (RPA) and that neither the grantee nor applicant had submitted documentation of sufficient extenuating circumstances to justify a time extension.
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