Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 44761 

1 Disaster Relief Act of 1974, Public Law 93–288, 

88 Stat. 143 (May 22, 1974), as amended, 42 U.S.C. 

5121 et seq. 

DEPARTMENT OF HOMELAND 

SECURITY 

Federal Emergency Management 

Agency 

44 CFR Part 206 

[Docket ID FEMA–2009–0006] 

RIN 1660–AA63 

Arbitration for Public Assistance 

Determinations Related to Hurricanes 

Katrina and Rita (Disasters DR–1603, 

DR–1604, DR–1605, DR–1606, and DR– 

1607) 

AGENCY: Federal Emergency 

Management Agency, DHS. 

ACTION: Final rule. 

SUMMARY: Pursuant to the American 

Recovery and Reinvestment Act of 2009 

(ARRA), this final rule establishes an 

option for arbitration under the Public 

Assistance program administered by the 

Federal Emergency Management 

Agency. Public Assistance grant award 

determinations related to Hurricanes 

Katrina and Rita under major disaster 

declarations DR–1603, DR–1604, DR– 

1605, DR–1606, and DR–1607 are 

eligible for arbitration, within the limits 

set by this rule. 

DATES: Effective Date: August 31, 2009. 

FOR FURTHER INFORMATION CONTACT: Tod 

Wells, Deputy Director, Public 

Assistance Division, Federal Emergency 

Management Agency, 500 C Street, SW., 

Washington DC, 20472–3100, (phone) 

202–646–3936, or (e-mail) 

tod.wells@dhs.gov. 

SUPPLEMENTARY INFORMATION: 

I. Background 

A. Public Assistance Process for Project 

Approval 

Under the Public Assistance program, 

authorized by the Robert T. Stafford 

Disaster Relief and Emergency 

Assistance Act 1 (Stafford Act), the 

Federal Emergency Management Agency 

(FEMA) awards grants to State and local 

governments, Indian Tribal 

governments, and certain private 

nonprofit organizations (‘‘eligible 

applicant’’—44 CFR 206.222) to assist 

them to respond to and recover from 

Presidentially-declared emergencies and 

major disasters as quickly as possible. 

Specifically, the program provides 

assistance for debris removal, 

emergency protective measures, and 

permanent restoration of infrastructure. 

When the President declares an 

emergency or major disaster declaration 

for a State, authorizing the Public 

Assistance program, an eligible 

applicant may apply for Public 

Assistance. The applicant submits a 

Request for Public Assistance (FEMA 

Form 90–49) to FEMA through the 

Grantee, which is usually the State, but 

may be an Indian Tribal government. An 

eligible applicant may be a State agency, 

a local or Tribal government, or a 

private nonprofit organization. See 44 

CFR 206.222. Upon award, the Grantee 

notifies the applicant of the award, and 

the applicant becomes a subgrantee. 

The basis for the Public Assistance 

grant is a project worksheet. The project 

worksheet documents the details of the 

project, which is a logical grouping of 

work required as a result of a declared 

major disaster or emergency. A project 

may include eligible work at several 

sites, and may include more than one 

project worksheet. A project worksheet 

is the primary form used to document 

the location, damage description and 

dimensions, scope of work, and cost 

estimate for each project. The Office of 

Management and Budget has approved 

the project worksheet form (FEMA Form 

90–91) under information collection 

number 1660–0017. When the scope of 

work or estimated costs of a project 

change, FEMA generates an additional 

version of the project worksheet. It is 

not uncommon to have several versions 

of a project worksheet for one project, as 

it may be difficult to predict costs and 

scope of work at the beginning of a 

project. 

FEMA divides applications for Public 

Assistance into two groups—large 

projects and small projects—based on 

the dollar amount of the project. The 

threshold for large and small projects is 

adjusted annually to reflect changes in 

the Consumer Price Index for All Urban 

Consumers published by the United 

States Department of Labor. The 

threshold for small projects in Fiscal 

Year 2005 (Hurricanes Katrina and Rita 

occurred in Fiscal Year 2005) was 

$55,500. The project worksheet process 

is slightly different for these two types 

of projects. Since the arbitration process 

applies only to large projects totaling 

more than $500,000, this rulemaking 

will address the process for reviewing 

project worksheets for large projects. 

Project worksheets for large projects 

are developed by a FEMA Project 

Specialist, working with the applicant/ 

subgrantee, and are submitted directly 

to a FEMA Public Assistance 

Coordinator (PAC) Crew Leader for 

review and processing. Although large 

projects are funded on documented 

actual costs, work typically is not 

complete at the time of project approval. 

Therefore, FEMA obligates large project 

grants based on estimated costs. The 

obligation process is the process by 

which funds are made available to the 

Grantee. The funds reside in a Federal 

account until drawn down by the 

Grantee and paid to the applicant/ 

subgrantee. When the applicant/ 

subgrantee or Grantee disagree with 

FEMA’s determination about whether a 

cost is eligible for reimbursement or 

reasonable, among other project 

worksheet determinations, FEMA 

provides an appeals process to 

adjudicate such disputes. 

B. Public Assistance Appeal Process 

Under 44 CFR 206.206 

Traditionally, under the appeals 

procedures in 44 CFR 206.206, an 

eligible applicant, subgrantee, or 

Grantee may appeal any determination 

made by FEMA related to an application 

for or the provision of Public 

Assistance. There are two levels of 

appeal. The first level appeal is to the 

FEMA Regional Administrator. The 

second level appeal is to the FEMA 

Assistant Administrator for the Disaster 

Assistance Directorate. Typical appeals 

involve disputes regarding whether an 

applicant, facility, item of work, or 

project is eligible for Public Assistance, 

whether approved costs are sufficient to 

complete the work, whether a requested 

time extension was properly denied, 

whether a portion of the cost claimed 

for the work is eligible, or whether the 

approved scope of work is correct. 

An applicant/subgrantee appellant 

must file an appeal with the Grantee 

within 60 days of the appellant’s receipt 

of a notice of the determination that is 

being appealed. The appellant must 

provide documented justification to 

support the position of the appellant. 

This documentation should specify the 

monetary amount in dispute and the 

provisions in Federal law, regulation, or 

policy with which the appellant 

believes the initial action was 

inconsistent. The Grantee reviews and 

evaluates the appeal documentation. 

The Grantee then prepares a written 

recommendation on the merits of the 

appeal and forwards that 

recommendation to the FEMA Regional 

Administrator within 60 days of its 

receipt of the appeal. The Grantee need 

not endorse the appeal position but 

must forward all appeals it receives. 

The Regional Administrator reviews 

the appeal and takes one of two actions: 

(1) Renders a decision on the appeal and 

informs the Grantee of the decision; or 

(2) requests additional information. The 

appellant may be granted 60 days to 

provide any additional information, and 

the Regional Administrator provides a 


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44762 Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 

decision on the appeal within 90 days 

of receipt of that information. If the 

appeal is granted, the Regional 

Administrator takes appropriate action, 

such as approving additional funding, 

denying additional funding, or sending 

a Project Specialist to meet with the 

appellant to determine additional 

eligible funding. 

If the Regional Administrator denies 

the appeal, the appellant may submit a 

second appeal. The appellant must 

submit the second appeal to the Grantee 

within 60 days of receiving notice of the 

Regional Administrator’s decision. The 

Grantee must forward the second level 

appeal with a written recommendation 

to the Regional Administrator within 60 

days of receiving the second appeal. The 

Regional Administrator reviews the 

information provided with the second 

appeal and requests additional 

information if necessary. The Regional 

Administrator forwards the second 

appeal with a recommendation for 

action to the FEMA Assistant 

Administrator as soon as practicable. 

The FEMA Assistant Administrator 

for the Disaster Assistance Directorate 

reviews the second appeal and renders 

a decision or requests additional 

information from the appellant. In a 

case involving highly technical issues, 

FEMA may request an independent 

scientific or technical analysis by a 

group or person having expertise in the 

subject matter of the appeal. Upon 

receipt of requested information from 

the appellant and any other requested 

reports, FEMA renders a decision on the 

second appeal within 90 days. This 

decision constitutes the final 

administrative decision of FEMA. See 

44 CFR 206.206(e)(3). 

C. The American Recovery and 

Reinvestment Act of 2009 

The President signed the American 

Recovery and Reinvestment Act of 2009 

(ARRA or Act), Public Law 111–5, into 

law on February 17, 2009. Section 601 

of the ARRA requires the President to 

establish an arbitration panel under 

FEMA’s Public Assistance program to 

expedite recovery efforts from 

Hurricanes Katrina and Rita within the 

Gulf Coast region. The ARRA further 

requires the arbitration panel to have 

sufficient authority regarding the award 

or denial of disputed Public Assistance 

applications for covered hurricane 

damage under sections 403, 406, or 407 

of the Stafford Act. The ARRA limits 

arbitration to projects that total more 

than $500,000. By memorandum dated 

August 6, 2009, the President assigned 

to the Secretary of the U.S. Department 

of Homeland Security the function of 

the President under section 601. See 74 

FR 40055 (Aug. 10, 2009). 

Three states in the Gulf Coast region 

have Public Assistance project 

worksheets from Hurricane Katrina that 

are awaiting an initial determination 

from FEMA: Louisiana, Mississippi, and 

Alabama. Two states in the Gulf Coast 

region have Public Assistance project 

worksheets from Hurricane Rita that are 

awaiting an initial determination from 

FEMA: Louisiana and Texas. Any 

funding of these project worksheets 

would be under the following major 

disaster declarations: DR–1603 

(Louisiana—Hurricane Katrina), DR– 

1604 (Mississippi—Hurricane Katrina), 

DR–1605 (Alabama—Hurricane 

Katrina), DR–1606 (Texas—Hurricane 

Rita), and DR–1607 (Louisiana— 

Hurricane Rita). Approximately 44 

appeals are pending from these 

declarations. Further, there are 

approximately 2,188 Public Assistance 

project worksheets from Louisiana and 

Mississippi awaiting an initial 

determination of eligibility under the 

Public Assistance program from FEMA, 

which, if disputed, may be appealed. 

These project worksheets are at various 

stages within the determination process. 

For example, some are incomplete and 

awaiting further information from the 

applicant, some are undergoing site 

visits, and some have additional 

versions requiring FEMA review. 

II. Discussion of the Rule 

A. General 

This regulation is promulgated 

pursuant to section 601 of the ARRA 

and establishes arbitration procedures to 

resolve outstanding disputes regarding 

Public Assistance projects over 

$500,000 from the states of Louisiana, 

Mississippi, Alabama, and Texas under 

the following declarations: DR–1603, 

DR–1604, DR–1605, DR–1606, and DR– 

1607. Public Assistance applicants/ 

subgrantees under these declarations 

may request arbitration in lieu of filing 

an appeal under 44 CFR 206.206 for any 

determination made by FEMA that is 

eligible for appeal and meets the 

$500,000 threshold. As discussed 

below, Public Assistance applicants/ 

subgrantees under these declarations 

who were engaged in the FEMA appeals 

process as of February 17, 2009, and had 

not received a final agency decision 

prior to February 17, 2009, may request 

arbitration in lieu of the appeal, even if 

FEMA issued a final agency decision on 

the appeal on or after February 17, 2009. 

B. Applicability and Limitations 

The purpose of the ARRA is to 

expedite recovery efforts from 

Hurricanes Katrina and Rita within the 

Gulf Coast region. Therefore, the option 

for arbitration is limited to Public 

Assistance project worksheets filed 

under one of the five major disaster 

declarations declared for Hurricanes 

Katrina and Rita in the Gulf Coast 

region. In addition, the total amount of 

the Public Assistance project must be 

greater than $500,000. This dollar 

limitation is set by section 601 of the 

ARRA and is not within FEMA’s 

discretion. 

Arbitration is not an option if an 

agency decision became final before 

February 17, 2009, the date when 

arbitration became a legal option for 

Public Assistance applicants under the 

ARRA. For those determinations made 

prior to February 17, 2009, FEMA has 

determined that a final decision will 

exist in three instances: (1) When the 

applicant/subgrantee did not file an 

appeal within the 60-day appeal period; 

(2) when the applicant/subgrantee failed 

to file for a second appeal within 60 

days of denial of its first appeal; or (3) 

when FEMA issued an appeal decision 

on a second appeal of the applicant/ 

subgrantee. See 44 CFR 206.206. If there 

was a final decision before February 17, 

2009, the applicant/subgrantee has 

exhausted its administrative remedies 

and may not elect arbitration. 

The ARRA created the right to 

arbitration as of its effective date. If the 

applicant/subgrantee is eligible to file 

an appeal under 44 CFR 206.206, or if 

a first or second level appeal was 

pending on or after February 17, 2009, 

arbitration remains an option. 

Applicants/subgrantees that had a first 

or second level appeal pending on or 

after February 17, 2009, may choose 

arbitration, regardless of whether FEMA 

has issued a decision on the appeal 

since the effective date of the ARRA. 

However, if the applicant/subgrantee 

was eligible to appeal after the effective 

date of the ARRA, but allowed the 

appeal period to expire without filing an 

appeal, the applicant/subgrantee is not 

eligible to file an appeal and, therefore, 

is not eligible for arbitration. 

The stated purpose of the ARRA 

arbitration provision is to ‘‘expedite’’ 

recovery efforts. Accordingly, a request 

for arbitration is in lieu of filing or 

continuing an appeal under 44 CFR 

206.206. The use of only one review 

procedure, arbitration or appeal, is more 

expeditious than two consecutive 

review procedures. The use of both 

arbitration and the standard appeal 

process would lengthen, not expedite, 

the recovery process. Arbitration and 

appeals each require significant time to 

complete, and FEMA has determined 

going forward that it would be contrary 


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to Congressional intent to allow 

applicants/subgrantees to pursue both 

an appeal and arbitration. 

C. Content of Request for Arbitration 

and Other Submissions 

A request for arbitration must contain 

a written statement and all 

documentation supporting the 

applicant’s or subgrantee’s position. The 

applicant/subgrantee may provide 

supporting documentation not 

previously included in the project 

worksheet or the application to FEMA. 

There is no limit on the amount of 

documentation that may be provided. 

The request should include all 

information necessary for the arbitration 

panel to make an informed decision. 

The request should clearly set out the 

applicant’s/subgrantee’s position. The 

parties are encouraged to describe their 

claims in sufficient detail to make the 

circumstances of the dispute clear to the 

arbitration panel. 

Any party may be represented by 

counsel or another authorized 

representative. If represented, the party 

must provide the name and address of 

the representative to the other party, the 

Grantee, and the arbitration panel. 

All papers, notices, or other 

documents submitted to the arbitration 

panel by the applicant or subgrantee, 

the Grantee, or FEMA must be 

simultaneously served on each party’s 

authorized representative or counsel. 

The submitting party must make such 

service by courier or overnight delivery 

service (such as Federal Express, DHL, 

United Parcel Service, or the United 

States Postal Service overnight 

delivery), addressed to the party, 

representative, or counsel, as applicable, 

at its last known address. 

D. Submission of the Request for 

Arbitration 

An applicant/subgrantee must submit 

a request for arbitration simultaneously 

to the Grantee, the applicable FEMA 

Regional Administrator, and the 

arbitration administrator. FEMA will 

post an address, phone number, and fax 

number for the arbitration administrator 

on FEMA’s Web site at http:// 

www.fema.gov. Consistent with the 

Section B above, any application or 

project worksheet totaling more than 

$500,000 that is eligible for appeal is 

eligible for arbitration. 

If there is a first or second level 

appeal pending with FEMA, or if FEMA 

issued a decision on a first or second 

level appeal on or after February 17, 

2009, the applicant/subgrantee must 

submit the request for arbitration, as 

well as a withdrawal of the pending 

appeal, if applicable, simultaneously to 

the Grantee, the applicable FEMA 

Regional Administrator, and the 

arbitration administrator by October 30, 

2009. Otherwise, if the applicant/ 

subgrantee seeks arbitration, it must 

request arbitration in writing to the 

Grantee within 30 calendar days after 

receipt of notice of the determination 

that is the subject of the arbitration 

request, or by September 30, 2009, 

whichever is later. Issues that may be 

arbitrated would be the same as those 

that are normally subject to appeal, 

provided the total amount of the project 

is greater than $500,000. As an example, 

a subgrantee could appeal the amount of 

the FEMA-approved costs, where the 

subgrantee believes the eligible amount 

should be greater. Examples of second 

appeals can be found at http:// 

www.fema.gov/appeals/. 

E. Submission by the Grantee 

Within 15 calendar days of receipt of 

the applicant’s or subgrantee’s request 

for arbitration, the Grantee may forward 

a written recommendation in support or 

opposition of the applicant’s or 

subgrantee’s request simultaneously to 

the FEMA Regional Administrator, the 

arbitration administrator, and the 

applicant. In addition, the Grantee must 

forward the name and address of the 

Grantee’s authorized representative or 

counsel. 

In selecting 15 calendar days, FEMA 

is implementing the intent of the ARRA. 

The Act specifically requires the 

arbitration process to ‘‘expedite’’ 

recovery efforts from Hurricanes Katrina 

and Rita. A 15-calendar-day time limit 

is intended to expedite the resolution of 

the applicant’s or subgrantee’s dispute. 

However, this 15-day time period will 

allow sufficient time for the Grantee to 

review the request and prepare a 

recommendation without delaying the 

arbitration process. 

F. Submission of FEMA’s Response 

Within 30 calendar days of receipt of 

the applicant’s or subgrantee’s request, 

FEMA will simultaneously submit a 

response in support of its position, a 

copy of the project worksheet(s), and 

any supporting information to the 

arbitration administrator, the Grantee, 

and the applicant/subgrantee. 

G. Selection of Arbitrators 

The arbitration panels will be 

composed of three judges drawn from 

the Federal pool of current and senior 

administrative law judges and other 

similar officials serving in adjudicative 

capacities on boards, commissions and 

agencies. Each panel will be selected by 

the arbitration administrator. The 

individuals assigned to any one panel 

may change from case to case, as 

assigned by the arbitration 

administrator. The arbitration 

administrator will notify all parties to 

the arbitration of the names and 

identities of the arbitrators selected for 

the panel. 

H. Preliminary Conference 

Within 10 business days of the panel’s 

receipt of FEMA’s response to the 

request for arbitration, a preliminary 

conference will be held by telephone 

with the arbitrators, the parties and/or 

their representatives. The preliminary 

conference may address such issues as 

the future conduct of the case, including 

clarification of the issues and claims, 

possible arbitrator disqualification, the 

scheduling of hearings and the hearing 

location, if applicable, and other 

administrative matters. 

I. Hearing 

The panel will provide the applicant/ 

subgrantee and FEMA with an 

opportunity to make an oral 

presentation in person, by telephone 

conference, or other means during 

which all the parties may 

simultaneously hear all other 

participants. If the applicant/subgrantee 

or FEMA would like to request a 

hearing, it must be requested no later 

than the preliminary conference. The 

panel will determine the hearing 

location, and its decision will be final 

and binding. The panel will endeavor to 

hold the hearing within 60 calendar 

days of the preliminary conference, 

unless the panel postpones the hearing 

upon agreement of the parties, or at the 

request of a party for good cause shown. 

If the hearing is postponed, the panel 

will set a new date within 10 business 

days of the postponement. 

The parties may not engage in 

discovery or provide additional paper 

submissions at the hearing. Each party 

may present its position through oral 

presentations by individuals designated 

in advance of the hearing. If the panel 

deems it appropriate or necessary, it 

may request additional written materials 

from either or both parties or seek the 

advice or expertise of independent 

scientific or technical subject matter 

experts, such as engineers and 

architects. 

J. Review by the Arbitration Panel 

In its review, the arbitration panel 

will consider all relevant written 

materials provided by the parties and 

the Grantee. If a hearing is held, the 

panel will also consider the oral 

presentations made at the hearing. In 

addition, the panel may, if it deems 

appropriate or necessary, seek the 


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44764 Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 

advice or expertise of independent 

scientific or technical subject matter 

experts, such as engineers or architects. 

K. Decision: Time Limits 

The panel will make every effort to 

issue a written decision within 60 

calendar days after the panel declares 

the hearing closed, or if an oral 

presentation was not requested, within 

60 calendar days following the receipt 

of FEMA’s response to the request for 

arbitration. In general, 60 days is a 

reasonable time for a panel to review the 

determination, discuss the issues 

involved, and issue a decision. It is 

shorter than the 90 days allotted for first 

and second level appeals under the 

appeals process, and in keeping with 

the purpose of the arbitration 

provision—to expedite the recovery 

process. 

However, the issues involved in 

Public Assistance determinations can be 

technical and complex. In cases 

involving highly technical and complex 

matters, a decision of the panel may 

take longer than 60 days. The appeal 

regulation allows additional time for 

review of an appeal when highly 

technical issues are involved. See 44 

CFR 206.206(d). Similarly, this 

regulation provides for the possibility 

that the arbitration panel will not be 

able to render a decision within 60 days 

on such issues. 

L. Finality of Decision 

A decision of the majority of the panel 

will constitute a final decision, binding 

on all parties. Final decisions are not 

subject to further administrative review. 

Final decisions are not subject to 

judicial review, except as permitted by 

9 U.S.C. 10. 

M. Ex Parte Communications 

No party, and no one acting on behalf 

of any party, will have ex parte 

communications with an arbitrator. This 

means that neither the applicant/ 

subgrantee, the Grantee, nor FEMA may 

communicate with an arbitrator about a 

particular arbitration without the 

participation of the other parties or their 

representatives. If a party engages in an 

ex parte communication, the party 

engaged in such communication must 

provide a summary or a transcript of the 

entire communication to the other 

parties. 

N. Costs 

FEMA will pay the fees of the 

arbitrators, the costs of any expert 

retained by the panel and the arbitration 

facility costs, if any. The expenses for 

each party, including attorney’s fees, 

representative fees, copying costs, costs 

associated with attending any hearing, 

and any other fees not specifically listed 

in the regulation must be paid by the 

party incurring the expense. 

O. Guidance 

FEMA will issue separate guidance as 

necessary to supplement this regulation. 

III. Regulatory Analysis 

A. Administrative Procedure Act 

The Administrative Procedure Act 

(APA) requires an agency to publish a 

rule for public comment prior to 

implementation. 5 U.S.C. 553. The APA, 

however, provides an exception to this 

requirement for rules of agency 

procedure or practice. 5 U.S.C. 553 

(b)(3)(A). 

This rule implements section 601 of 

the ARRA by detailing how a Public 

Assistance applicant or subgrantee may 

request arbitration. It is therefore, a 

procedural rule; it establishes 

procedures for making an arbitration 

request and the procedures FEMA will 

follow in issuing an arbitration decision. 

The rule does not affect eligibility under 

the Public Assistance program; rather, it 

adds an option for review of Public 

Assistance applications to expedite 

recovery efforts. FEMA already provides 

for review of these determinations 

through the appeal provisions of 44 CFR 

206.206. This rule simply provides an 

alternate procedure for seeking such a 

review of FEMA determinations. 

Further, because this rule is 

procedural in nature and does not 

confer any substantive rights, benefits or 

obligations, FEMA finds that this rule 

shall become effective immediately 

upon publication of this final rule in the 

Federal Register. 5 U.S.C. 553(d). 

B. Executive Order 12866, Regulatory 

Planning and Review 

Under Executive Order 12866, 

regulatory actions are subject to Office 

of Management and Budget (OMB) 

review and the requirements of the 

Executive Order. The Executive Order 

defines ‘‘significant regulatory action’’ 

as one that is likely to result in a rule 

that may: 

(1) Have an annual effect on the 

economy of $100 million or more or 

adversely affect in a material way the 

economy, a sector of the economy, 

productivity, competition, jobs, the 

environment, public health or safety, or 

State, local, or Tribal governments or 

communities; 

(2) Create a serious inconsistency or 

otherwise interfere with an action taken 

or planned by another agency; 

(3) Materially alter the budgetary 

impact of entitlements, grants, user fees, 

or loan programs or the rights and 

obligations of recipients thereof; or 

(4) Raise novel legal or policy issues 

arising out of legal mandates, the 

President’s priorities, or the principles 

set forth in the Executive Order. 

This rule is entirely voluntary. 

Applicants are not required to seek 

arbitration under the authority and 

requirements of this rule. This rule 

provides an additional option to 

applicants/subgrantees in lieu of appeal. 

For those that choose to undergo 

arbitration, this rule will result in a total 

cost increase of $389,363 to applicants/ 

subgrantees, and a cost savings of 

$4,242 to Grantees. This rule is not an 

economically significant regulatory 

action as defined in Executive Order 

12866. This is not a significant rule 

under Executive Order 12866; therefore, 

OMB has not reviewed this rule. 

Under FEMA’s standard appeal 

procedures, an applicant/subgrantee 

must file an appeal with documentation 

supporting the appeal within 60 days of 

the decision that is being appealed. The 

Grantee then forwards the request to the 

Regional Administrator within 60 days 

of receipt, and in doing so may submit 

a written recommendation to FEMA. 

The Regional Administrator then 

reviews the appeal and either makes a 

determination or seeks additional 

information from the applicant within 

90 days. 

If the Regional Administrator denies 

the appeal, the applicant/subgrantee 

may submit a second appeal to the 

Grantee within 60 days of the Regional 

Administrator’s denial. The Grantee 

must forward the second appeal to the 

Regional Administrator within 60 days 

of receipt. The Regional Administrator 

then forwards the second appeal to 

FEMA headquarters as soon as possible. 

Upon receipt, FEMA headquarters either 

requests additional information, 

requests independent scientific or 

technical analysis from experts, or 

makes a determination within 90 days. 

Under the arbitration procedures 

contained in this rule, an applicant/ 

subgrantee must submit a request for 

arbitration, with documentation 

supporting the request, simultaneously 

to the Grantee, applicable FEMA 

Regional Administrator, and the 

arbitration administrator. For those that 

do not have a pending appeal with 

FEMA, this request is due within 30 

days of receipt of notice of the 

determination that is the subject of the 

arbitration request. If there is an appeal 

pending with FEMA, or if FEMA has 

issued a decision on a first or second 

level appeal on or after February 17, 

2009, the request for arbitration with 

supporting documentation, and if 


sroberts on DSKD5P82C1PROD with RULES
Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 44765 

2This figure was generated using similar 

estimates from other Federal agencies requests for 

arbitration. For example, National Mediation Board 

receives about 80 ‘‘Requests for Arbitration Panel 

for Airline System Boards of Adjustment’’ annually 

with a burden estimate of 20 hours per year (74 FR 

10098); or Federal Mediation and Conciliation 

Service’s ‘‘Request for Arbitration Services’’ form, 

receiving approximately 10,000 per year and 

estimating about 10 minutes to complete (71 FR 

69130). 

applicable, a statement that they 

withdraw the pending appeal, must be 

sent simultaneously to the Grantee, the 

applicable FEMA Regional 

Administrator, and the arbitration 

administrator by October 30, 2009. The 

Grantee may forward a recommendation 

to the Regional Administrator and the 

arbitration administrator, with a copy to 

the applicant, within 15 days of receipt 

from the applicant/subgrantee. 

Once formed, the panel will conduct 

a preliminary conference by telephone, 

and if requested, the parties will be 

provided a hearing to make an oral 

presentation in person, by telephone 

conference or other means during which 

all the parties may simultaneously hear 

all other participants. The location will 

be chosen by the panel. The panel may, 

if it deems appropriate or necessary, 

seek the advice or expertise of 

independent scientific or technical 

subject matter experts, or request 

additional information from the parties. 

The panel will then endeavor to issue a 

written decision within 60 days after the 

hearing or, if there is no hearing, after 

receipt of FEMA’s response to the 

request for arbitration. 

As of July 17, 2009, FEMA had 2,188 

project worksheets that had not yet 

received an initial determination from 

FEMA as well as 44 pending appeals for 

disasters DR–1603, DR–1604, DR–1605, 

DR–1606, and DR–1607 that are for 

projects over $500,000. Adding the 44 

existing appeals to the 2,188 projects 

which may result in appealable 

determinations creates a total of 2,232 

potential projects that may be eligible 

for arbitration. Not all project 

worksheets will have contested 

determinations that will result in 

arbitration, and not all pending appeals 

will be withdrawn in favor of 

arbitration. To generate the cost 

estimates for this rulemaking, FEMA 

used existing data for first appeals. 

FEMA receives an average of 364 

appeals per year. Conservatively 

estimating that 80 percent of those 

appeals involve large projects, FEMA 

estimates that 291 appeals are 

associated with the total 5,008 large 

projects obligated by FEMA per year. As 

a result, FEMA estimates that 5.81 

percent of large projects are appealed 

(5.81% = 291/5,008). By applying this 

percentage, FEMA estimates that 127 

appeals are expected from the 2,188 

large projects over $500,000 that have 

not yet received an initial determination 

from FEMA for disasters DR–1693, DR– 

1604, DR–1605, DR–1606, and DR–1607 

(5.81% × 2,188 = 127). 

The arbitration process requires the 

applicant/subgrantee to submit a request 

for arbitration simultaneously to the 

Grantee, the applicable FEMA Regional 

Administrator, and the arbitration 

administrator in the form of a written 

statement from the applicant/ 

subgrantee, which FEMA conservatively 

estimates will take an applicant/ 

subgrantee approximately one hour to 

complete.2 Within 15 days of receipt of 

the request for arbitration, the Grantee 

may forward a recommendation to 

FEMA and the arbitration administrator 

(with a copy to the applicant/ 

subgrantee), which FEMA estimates will 

take the Grantee approximately one 

hour to complete. FEMA therefore 

estimates that it will take 127 

applicants/subgrantees a cumulative 

127 hours to prepare requests for 

arbitration and the four potential 

Grantees (the States of LA, MS, TX, and 

AL) a cumulative 127 hours to prepare 

and forward their recommendation to 

FEMA and the arbitration administrator. 

FEMA obtained the national average 

hourly wage for a managerial ($36.50) 

position in State government from the 

Bureau of Labor Statistics (2009) ‘‘May 

2007 National Industry-specific 

Occupational Employment and Wage 

Estimates’’, NAICS 999200—State 

Government (OES Designation). The 

managerial wage rate was for the 

‘‘General and Operations Managers 

position (standard occupational 

classification (SOC) code #: 11–1021).’’ 

The Bureau of Labor Statistics’ hourly 

wage reflects only the direct cost of 

employment. FEMA, therefore, 

multiplied the wage rates by 1.4 to 

derive the full employment costs for a 

managerial ($51.10) position in State 

government. FEMA estimates that it will 

take applicants/subgrantees and 

Grantees the same amount of time to 

prepare requests for arbitration as it 

takes them to prepare requests for 

appeal. Therefore, FEMA estimates that 

this rulemaking will result in a cost 

savings of $6,490 (= 127 × 51.10) for 

applicants/subgrantees and $6,490 (= 

127 × 51.10) for Grantees. These cost 

savings occur because there is no 

requirement for an applicant/subgrantee 

to resubmit documentation through a 

second round of review to exhaust its 

administrative remedies under 

arbitration, as there is in the appeals 

process. This method is intended to 

reduce the administrative burden on 

applicants/subgrantees. Applicant/ 

subgrantees may only seek one method 

for resolution of the dispute—appeal or 

arbitration—not both. 

In addition to the 2,188 project 

worksheets which have not yet received 

an initial determination from FEMA, as 

noted above, as of July 17, 2009, FEMA 

currently has 44 pending appeals. 

Although it is not expected that all of 

these appeals will be withdrawn in 

favor of arbitration, as a conservative 

estimate for the purposes of this 

analysis, FEMA estimates that all 44 

will withdraw in favor of arbitration. 

Therefore these applicants/subgrantees 

will also submit a request for arbitration 

containing a statement that they 

withdraw their appeal. FEMA estimates 

it will take the applicant/subgrantee 

approximately one hour to prepare its 

request and the Grantee one hour to 

prepare its recommendation and 

forward it to FEMA and the arbitration 

administrator. Using the $51.10 wage 

rate established above, FEMA estimates 

that this change will have a total cost of 

$2,248 (= 44 × $51.10) to applicants/ 

subgrantees and $2,248 (= 44 × $51.10) 

to Grantees. 

The panel will conduct a preliminary 

conference by telephone, and if 

requested, the parties will make an oral 

presentation in person, by telephone 

conference or other means during which 

all the parties may simultaneously hear 

all other participants at a location 

designated by the panel. In person 

appearance at a hearing is entirely 

voluntary, at the applicant’s/ 

subgrantee’s discretion. If they choose to 

appear, however, the costs to do so are 

incurred by the applicant/subgrantee. 

Because the hearings may be conducted 

via telephone or other means during 

which all the parties may 

simultaneously hear all other 

participants, most applicants are not 

expected to have any travel costs. For 

those who are granted an in-person 

hearing, the panel may choose to have 

the hearing in Washington, DC. It is also 

likely that more than one person will 

attend. This is based on FEMA’s 

experience meeting with applicants on 

second appeals, which usually involves 

about six people. This includes 

representatives from the applicant, the 

State, and any consultants. Assuming 

round trip air travel for a team of six 

people and that 25 percent of the 

applicants/subgrantees will make an inperson appearance, (43 = 25% × (127 + 

44)), FEMA estimates that the travel cost 

to applicants/subgrantees will be 


sroberts on DSKD5P82C1PROD with RULES
44766 Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 

3Average domestic airfare in the 4th quarter of 

2008 from the U.S. Department of Transportation’s 

Bureau of Transportation Statistics (BTS), May 6, 

2009, http://www.bts.gov/press_releases/2009/ 

bts021_09/html/bts021_09.html. 

4The amount of $361 includes hotel expense for 

one night, and meals and incidental expenses for 

two days. The per diem rate for the District of 

Columbia is obtained from the U.S. General 

Services Administration, May 2009, http:// 

www.gsa.gov/Portal/gsa/ep/

contentView.do?queryYear=2009&

contentType=GSA_BASIC&contentId=17943&

queryState=District+of+Columbia&noc=T. 

$89,526 (= 43 × 6 × $347 3)). In addition, 

should an applicant/subgrantee choose 

to appear in person, it will incur (1) 

lodging, meals, and incidental expenses, 

and (2) the regular-time cost of the 

employee who attends the hearing in 

lieu of performing that employee’s 

regular duties. Assuming that 

attendance at a hearing will require two 

work days to travel to and attend the 

hearing, lodging, meals, and incidental 

expenses will be $93,138 (= 43 × 6 

people × $361 4). The time cost to 

applicants/subgrantees will be $210,941 

(= 43 × 6 people × 16 hours × $51.10). 

Therefore, the total cost to applicants/ 

subgrantees for in-person presentation 

at a hearing is estimated to be $393,605 

(= $89,526 + $93,138 + $210,941). 

FEMA will pay the fees of the 

arbitrators, the costs of any expert 

retained by the panel, and the 

arbitration facility costs, if any. Even 

though FEMA cannot quantify this cost 

change, it is not likely to be 

economically significant given the 

number of arbitrations expected from 

disasters DR–1603, DR–1604, DR–1605, 

DR–1606, and DR–1607. Additionally, it 

will save the Federal government the 

time and costs it would have incurred 

to process appeals. FEMA estimates that 

this rule will result in a cost increase of 

$389,363 to applicants/subgrantees, and 

a cost saving of $4,242 to Grantees. 

Table 1 details the impact of the final 

rule. FEMA did not annualize the 

impact because this rule applies only to 

disasters DR–1603, DR–1604, DR–1605, 

DR–1606, and DR–1607. FEMA has 

determined that this rule will not have 

a significant economic impact of $100 

million or more per year. 

TABLE 1—QUANTIFIED IMPACT OF THE FINAL RULE

Applicants/ 

Subgrantees Grantees 

Requests for arbitration ........................................................................................................................................... ¥$6,490 

Requests forwarded for arbitration .......................................................................................................................... ¥$6,490 

Withdraw in favor of arbitration ............................................................................................................................... 2,248 2,248 

In-person presentation ............................................................................................................................................. 393,605 ........................

Sub-total ........................................................................................................................................................... 389,363 ¥4,242 

Grand Total ............................................................................................................................................... 385,121 

C. Regulatory Flexibility Act (RFA) 

The Regulatory Flexibility Act (RFA) 

(5 U.S.C. 601–612), and section 213(a) of 

the Small Business Regulatory 

Enforcement Fairness Act of 1996, 

Public Law 104–121, 110 Stat. 847, 858– 

9 (Mar. 29, 1996) (5 U.S.C. 601 note) 

require that special consideration be 

given to the effects of proposed 

regulations on small entities. The RFA 

mandates that an agency conduct a RFA 

analysis when an agency is ‘‘required by 

section 553 * * * to publish general 

notice of proposed rulemaking for any 

proposed rule.’’ 5 U.S.C. 603(a). 

Accordingly, an RFA is not required 

when a rule is exempt from notice and 

comment rulemaking under 5 U.S.C. 

553(b). FEMA has determined that this 

rule is exempt from notice and comment 

rulemaking because it is a rule of agency 

procedure. See 5 U.S.C. 553(b)(3)(A). 

Therefore, an RFA analysis under 5 

U.S.C. 603 is not required for this rule. 

D. National Environmental Policy Act 

(NEPA) 

This rulemaking is categorically 

excluded from further review under the 

National Environmental Policy Act 

(NEPA), Public Law 91–190, 83 Stat. 

852 (Jan. 1, 1970) (42 U.S.C. 4321 et 

seq.), as amended. Action taken or 

assistance provided under sections 403, 

406, and 407 of the Stafford Act are 

statutorily excluded from NEPA and the 

preparation of environmental impact 

statements and environmental 

assessments by section 316 of the 

Stafford Act. 42 U.S.C. 5159; 44 CFR 

10.8(c). NEPA implementing regulations 

governing FEMA activities at 44 CFR 

10.8(d)(2)(ii) categorically exclude the 

preparation, revision, and adoption of 

regulations from the preparation of an 

environmental assessment or 

environmental impact statement, where 

the rule relates to actions that qualify for 

categorical exclusions. Action taken or 

assistance provided under sections 403 

and 407 of the Stafford Act are 

categorically excluded under 44 CFR 

10.8(d)(2)(xix). Because no other 

extraordinary circumstances have been 

identified, this rule does not require the 

preparation of either an environmental 

assessment or an environmental impact 

statement as defined by NEPA. 

E. Executive Order 12898, 

Environmental Justice 

Under Executive Order 12898, Federal 

Actions to Address Environmental 

Justice in Minority Populations and 

Low-Income Populations, 59 FR 7629, 

February 16, 1994, FEMA incorporates 

environmental justice into its policies 

and programs. The Executive Order 

requires each Federal agency to conduct 

its programs, policies, and activities that 

substantially affect human health or the 

environment, in a manner that ensures 

that those programs, policies, and 

activities do not have the effect of 

excluding persons from participation in 

our programs, denying persons the 

benefits of our programs, or subjecting 

persons to discrimination because of 

their race, color, or national origin. 

No action that FEMA can anticipate 

under this rule will have a 

disproportionately high or adverse 

human health and environmental effect 

on any segment of the population. 

Accordingly, the requirements of 

Executive Order 12898 do not apply to 

this rule. 

F. Congressional Review of Agency 

Rulemaking 

FEMA has sent this final rule to the 

Congress and to the Government 

Accountability Office under the 

Congressional Review of Agency 

Rulemaking Act, (‘‘Congressional 

Review Act’’), Public Law 104–121, 110 

Stat. 873 (Mar. 29, 1996) (5 U.S.C. 804). 

This rule is not a ‘‘major rule’’ within 

the meaning of the Congressional 

Review Act. 


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Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 44767 

G. Unfunded Mandates Reform Act of 

1995 

The Unfunded Mandates Reform Act 

of 1995, Public Law 104–4, 109 Stat. 48 

(Mar. 22, 1995) (2 U.S.C. 1501 et seq.), 

applies to any notice of proposed 

rulemaking that would implement any 

rule which includes a Federal mandate 

that may result in the expenditure by 

State, local, and Tribal governments, in 

the aggregate, or by the private sector, of 

$100 million or more in any one year. 

If the rulemaking includes a Federal 

mandate, the Act requires an agency to 

prepare an assessment of the anticipated 

costs and benefits of the Federal 

mandate. The Act also pertains to any 

regulatory requirements that might 

significantly or uniquely affect small 

governments. Before establishing any 

such requirements, an agency must 

develop a plan allowing for input from 

the affected governments regarding the 

requirements. FEMA has determined 

that this rule will not result in the 

expenditure by State, local, and Tribal 

governments, in the aggregate, nor by 

the private sector, of $100 million or 

more in any one year as a result of a 

Federal mandate, and it will not 

significantly or uniquely affect small 

governments. In light of the foregoing, 

FEMA has determined that no actions 

are deemed necessary under the 

provisions of the Unfunded Mandates 

Reform Act of 1995. 

H. Executive Order 13132, Federalism 

Executive Order 13132, Federalism, 

64 FR 43255, August 4, 1999, sets forth 

principles and criteria that agencies 

must adhere to in formulating and 

implementing policies that have 

federalism implications, that is, 

regulations that have substantial direct 

effects on the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government. Federal agencies 

must closely examine the statutory 

authority supporting any action that 

would limit the policymaking discretion 

of the States, and to the extent 

practicable, must consult with State and 

local officials before implementing any 

such action. This final rule involves no 

policies that have federalism 

implications under Executive Order 

13132. 

I. Paperwork Reduction Act of 1995 

This rule contains a collection of 

information that is subject to review by 

the Office of Management and Budget 

(OMB) under the Paperwork Reduction 

Act of 1995 (PRA), as amended, Public 

Law 104–13, 109 Stat. 163, (May 22, 

1995) (44 U.S.C. 3501–3520). The 

information collection included in this 

rule is approved by OMB under control 

number 1660–0017, Public Assistance 

Progress Report and Program Forms. 

J. Executive Order 13175, Consultation 

and Coordination With Indian Tribal 

Governments 

Executive Order 13175, Consultation 

and Coordination with Indian Tribal 

Governments, 65 FR 67249, Nov. 9, 

2000, applies to agency regulations that 

have Tribal implications, that is, 

regulations that have substantial direct 

effects on one or more Indian Tribes, on 

the relationship between the Federal 

Government and Indian Tribes, or on 

the distribution of power and 

responsibilities between the Federal 

Government and Indian Tribes. Under 

this Executive Order, to the extent 

practicable and permitted by law, no 

agency may promulgate any regulation 

that has Tribal implications, that 

imposes substantial direct compliance 

costs on Indian Tribal governments, and 

that is not required by statute, unless 

funds necessary to pay the direct costs 

incurred by the Indian Tribal 

government or the Tribe in complying 

with the regulation are provided by the 

Federal Government, or the agency 

consults with Tribal officials. 

There is no substantial direct 

compliance cost associated with this 

rule. This rule would not affect the 

distribution of power or responsibilities 

of Tribal governments. 

K. Executive Order 12630, 

Governmental Actions and Interference 

With Constitutionally Protected Property 

Rights 

FEMA has reviewed this rule under 

Executive Order 12630, ‘‘Governmental 

Actions and Interference with 

Constitutionally Protected Property 

Rights’’ (53 FR 8859, Mar. 18, 1988) as 

supplemented by Executive Order 

13406, ‘‘Protecting the Property Rights 

of the American People’’ (71 FR 36973, 

June 28, 2006). This rule will not affect 

the taking of private property or 

otherwise have taking implications 

under Executive Order 12630. 

L. Executive Order 12988, Civil Justice 

Reform 

FEMA has reviewed this rule under 

Executive Order 12988, ‘‘Civil Justice 

Reform’’ (61 FR 4729, Feb. 7, 1996). 

This rule meets applicable standards to 

minimize litigation, eliminate 

ambiguity, and reduce burden. 

List of Subjects in 44 CFR Part 206 

Administrative practice and 

procedure, Coastal zone, Community 

facilities, Disaster assistance, Fire 

prevention, Grant programs-housing and 

community development, Housing, 

Insurance, Intergovernmental relations, 

Loan programs—housing and 

community development, Natural 

resources, Penalties, Reporting and 

recordkeeping requirements. 

■ For the reasons discussed in the 

preamble, the Federal Emergency 

Management Agency amends 44 CFR 

part 206, subpart G, as follows: 

PART 206—FEDERAL DISASTER 

ASSISTANCE 

■ 1. The authority citation for part 206 

continues to read as follows: 

Authority: Robert T. Stafford Disaster 

Relief and Emergency Assistance Act, 42 

U.S.C. 5121 through 5207; Reorganization 

Plan No. 3 of 1978, 43 FR 41943, 3 CFR, 1978 

Comp., p. 329; Homeland Security Act of 

2002, 6 U.S.C. 101; E.O. 12127, 44 FR 19367, 

3 CFR, 1979 Comp., p. 376; E.O. 12148, 44 

FR 43239, 3 CFR, 1979 Comp., p. 412; and 

E.O. 13286, 68 FR 10619, 3 CFR, 2003 Comp., 

p. 166. 

■ 2. Add § 206.209 to read as follows: 

§ 206.209 Arbitration for Public Assistance 

determinations related to Hurricanes 

Katrina and Rita (Major disaster 

declarations DR–1603, DR–1604, DR–1605, 

DR–1606, and DR–1607). 

(a) Scope. Pursuant to section 601 of 

the American Recovery and 

Reinvestment Act of 2009, Public Law 

111–5, this section establishes 

procedures for arbitration to resolve 

disputed Public Assistance applications 

under the following major disaster 

declarations: DR–1603, DR–1604, DR– 

1605, DR–1606, and DR–1607. 

(b) Applicability. An applicant or 

subgrantee (hereinafter ‘‘applicant’’ for 

purposes of this section) may request 

arbitration of a determination made by 

FEMA on an application for Public 

Assistance, provided that the total 

amount of the project is greater than 

$500,000, and provided that: 

(1) the applicant is eligible to file an 

appeal under § 206.206; or 

(2) the applicant had a first or second 

level appeal pending with FEMA 

pursuant to § 206.206 on or after 

February 17, 2009. 

(c) Governing rules. An applicant that 

elects arbitration agrees to abide by this 

section and applicable guidance. The 

arbitration will be conducted pursuant 

to procedure established by the 

arbitration panel. 

(d) Limitations—(1) Election of 

remedies. A request for arbitration 

under this section is in lieu of filing or 

continuing an appeal under § 206.206. 

(2) Final agency action under 

§ 206.206. Arbitration is not available 

for any matter that obtained final agency 


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44768 Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 

action by FEMA pursuant to § 206.206 

prior to February 17, 2009. Arbitration 

is not available for determinations for 

which the applicant failed to file a 

timely appeal under the provisions of 

§ 206.206 prior to August 31, 2009, or 

for determinations which received a 

decision on a second appeal from FEMA 

prior to February 17, 2009. 

(e) Request for arbitration—(1) 

Content of request. The request for 

arbitration must contain a written 

statement and all documentation 

supporting the position of the applicant, 

the disaster number, and the name and 

address of the applicant’s authorized 

representative or counsel. 

(2) Submission by the applicant to the 

Grantee, the FEMA Regional 

Administrator, and the arbitration 

administrator. An applicant under 

paragraph (b)(1) of this section must 

submit its request for arbitration in 

writing simultaneously to the Grantee, 

the FEMA Regional Administrator, and 

the arbitration administrator within 30 

calendar days after receipt of notice of 

the determination that is the subject of 

the arbitration request or by September 

30, 2009, whichever is later. An 

applicant under paragraph (b)(2) of this 

section must make a request for 

arbitration in writing and, if FEMA has 

not issued a decision on the appeal, 

submit a withdrawal of the pending 

appeal, simultaneously to the Grantee, 

the FEMA Regional Administrator, and 

the arbitration administrator by October 

30, 2009. 

(3) Submission by the Grantee to the 

arbitration administrator and FEMA. 

Within 15 calendar days of receipt of 

the applicant’s request for arbitration, 

the Grantee must forward the name and 

address of the Grantee’s authorized 

representative or counsel, and may 

forward a written recommendation in 

support or opposition to the applicant’s 

request for arbitration, simultaneously 

to the FEMA Regional Administrator, 

the arbitration administrator, and the 

applicant. 

(4) Submission of FEMA’s response. 

FEMA will submit a memorandum in 

support of its position, a copy of the 

Project Worksheet(s), and any other 

supporting information, as well as the 

name and address of its authorized 

representative or counsel, 

simultaneously to the arbitration 

administrator, the Grantee, and the 

applicant, within 30 calendar days of 

receipt of the applicant’s request for 

arbitration. 

(5) Process for submissions. When 

submitting a request for arbitration, the 

applicant should describe its claim with 

sufficient detail so that the 

circumstances of the dispute are clear to 

the arbitration panel. All papers, 

notices, or other documents submitted 

to the arbitration administrator under 

this section by the applicant, the 

Grantee, or FEMA will be served on 

each party’s authorized representative 

or counsel. The submitting party will 

make such service by courier or 

overnight delivery service (such as 

Federal Express, DHL, United Parcel 

Service, or the United States Postal 

Service overnight delivery), addressed 

to the party, representative, or counsel, 

as applicable, at its last known address. 

(f) Selection of arbitration panel. The 

arbitration administrator will select the 

arbitration panel for arbitration and 

notify the applicant, FEMA, and the 

Grantee of the names and identities of 

the arbitrators selected for the panel. 

(g) Preliminary conference. The 

arbitration panel will hold a preliminary 

conference with the parties and/or 

representatives of the parties within 10 

business days of the panel’s receipt of 

FEMA’s response to the request for 

arbitration. The panel and the parties 

will discuss the future conduct of the 

arbitration, including clarification of the 

disputed issues, request for 

disqualification of an arbitrator (if 

applicable), and any other preliminary 

matters. The date and place of any oral 

hearing will be set at the preliminary 

conference. The preliminary conference 

will be conducted by telephone. 

(h) Hearing—(1) Request for hearing. 

The panel will provide the applicant 

and FEMA with an opportunity to make 

an oral presentation on the substance of 

the applicant’s claim in person, by 

telephone conference, or other means 

during which all the parties may 

simultaneously hear all other 

participants. If the applicant or FEMA 

would like to request an oral hearing, 

the request must be made no later than 

the preliminary conference. 

(2) Location of hearing. If an in-person 

hearing is authorized, it will be held at 

a hearing facility of the arbitration 

panel’s choosing. 

(3) Conduct of hearing. Each party 

may present its position through oral 

presentations by individuals designated 

in advance of the hearing. These 

presentations may reference documents 

submitted pursuant to paragraph (e) of 

this section; the parties may not provide 

additional paper submissions at the 

hearing. If the panel deems it 

appropriate or necessary, it may request 

additional written materials from either 

or both parties or seek the advice or 

expertise of independent scientific or 

technical subject matter experts. 

(4) Closing of hearing. The panel will 

inquire of each party whether it has any 

further argument. When satisfied that 

the record is complete, the panel will 

declare the hearing closed, unless a 

post-hearing submission of additional 

information or a memorandum of law is 

to be provided in accordance with this 

paragraph. The hearing will be declared 

closed as of the date set by the panel for 

the submission of the additional 

information or the memorandum of law. 

(5) Time limits. The panel will 

endeavor to hold the hearing within 60 

calendar days of the preliminary 

conference. 

(6) Postponement. The arbitration 

panel may postpone a hearing upon 

agreement of the parties, or upon 

request of a party for good cause shown. 

Within 10 business days of the 

postponement, the arbitration panel will 

notify the parties of the rescheduled 

date of the hearing. 

(7) Record of the hearing. There will 

be no recording of the hearing, unless a 

party specifically requests and arranges 

for such recording at its own expense. 

(8) Post-hearing submission of 

additional information. A party may file 

with the arbitration panel additional 

information or a memorandum of law 

after the hearing upon the arbitration 

panel’s request or upon the request of 

one of the parties with the panel’s 

consent. The panel will set the time for 

submission of the additional 

information or the memorandum of law. 

(9) Reopening of hearing. The hearing 

may be reopened on the panel’s 

initiative under compelling 

circumstances at any time before the 

decision is made. 

(i) Review by the arbitration panel. (1) 

Determination of timeliness. Upon 

notification by FEMA, or on its own 

initiative, the arbitration panel will 

determine whether the applicant timely 

filed a request for arbitration. 

(2) Substantive review. The arbitration 

panel will consider all relevant written 

materials provided by the applicant, the 

Grantee, and FEMA, as well as oral 

presentations, if any. If the panel deems 

it appropriate or necessary, it may 

request additional written materials 

from either or both parties or seek the 

advice or expertise of independent 

scientific or technical subject matter 

experts. 

(j) Ex parte communications. No party 

and no one acting on behalf of any party 

will engage in ex parte communications 

with a member of the arbitration panel. 

If a party or someone acting on behalf 

of any party engages in ex parte 

communications with a member of the 

arbitration panel, the party that engaged 

in such communication will provide a 

summary or a transcript of the entire 

communication to the other parties. 


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Federal Register / Vol. 74, No. 167 / Monday, August 31, 2009 / Rules and Regulations 44769 

(k) Decision—(1) Time limits. The 

panel will make every effort to issue a 

written decision within 60 calendar 

days after the panel declares the hearing 

closed pursuant to paragraph (h)(4) of 

this section, or, if a hearing was not 

requested, within 60 calendar days 

following the receipt of FEMA’s 

response to the request for arbitration. A 

decision of the panel may take longer 

than 60 calendar days if the arbitration 

involves a highly technical or complex 

matter. 

(2) Form and content. The decision of 

the panel will be in writing and signed 

by each member of the panel. The panel 

will issue a reasoned decision that 

includes a brief and informal discussion 

of the factual and legal basis for the 

decision. 

(3) Finality of decision. A decision of 

the majority of the panel shall constitute 

a final decision, binding on all parties. 

Final decisions are not subject to further 

administrative review. Final decisions 

are not subject to judicial review, except 

as permitted by 9 U.S.C. 10. 

(4) Delivery of decision. Notice and 

delivery of the decision will be by 

facsimile or other electronic means and 

by regular mail to each party or its 

authorized representative or counsel. 

(l) Costs. FEMA will pay the fees 

associated with the arbitration panel, 

the costs of any expert retained by the 

panel, and the arbitration facility costs, 

if any. The expenses for each party, 

including attorney’s fees, representative 

fees, copying costs, costs associated 

with attending any hearing, or any other 

fees not listed in this paragraph will be 

paid by the party incurring such costs. 

(m) Guidance. FEMA may issue 

separate guidance as necessary to 

supplement this section. 

Dated: August 14, 2009. 

Craig Fugate, 

Administrator, Federal Emergency 

Management Agency. 

[FR Doc. E9–19994 Filed 8–28–09; 8:45 am] 

BILLING CODE 9111–23–P 

DEPARTMENT OF DEFENSE 

Defense Acquisition Regulations 

System 

48 CFR 202, 209, 214, et al. 

Defense Federal Acquisition 

Regulations Supplement; Technical 

Amendments 

Correction 

In rule document E9–20416 beginning 

on page 42779 in the issue of Tuesday, 

August 25, 2009, make the following 

correction: 

On page 42780 starting in the first 

column, the definition for Contracting 

activity in section 202.101 is corrected 

to read as follows: 

202.101 Definitions. 

* * * * * 

Contracting activity for DoD also 

means elements designated by the 

director of a defense agency which has 

been delegated contracting authority 

through its agency charter. DoD 

contracting activities are— 

Department of Defense 

Counterintelligence Field Activity 

Department of Defense Education Activity 

TRICARE Management Activity 

Washington Headquarters Services, 

Acquisition and Procurement Office 

Army 

Headquarters, U.S. Army Contracting 

Command 

Joint Contracting Command—Iraq/ 

Afghanistan 

National Guard Bureau 

Program Executive Office for Simulation, 

Training, and Instrumentation 

U.S. Army Aviation and Missile Life Cycle 

Management Command 

U.S. Army Communications-Electronics Life 

Cycle Management Command 

U.S. Army Corps of Engineers 

U.S. Army Expeditionary Contracting 

Command 

U.S. Army Intelligence and Security 

Command 

U.S. Army Joint Munitions and Lethality Life 

Cycle Management Command 

U.S. Army Medical Command 

U.S. Army Medical Research and Materiel 

Command 

U.S. Army Mission and Installation 

Contracting Command 

U.S. Army Research, Development, and 

Engineering Command 

U.S. Army Space and Missile Defense 

Command 

U.S. Army Sustainment Command 

U.S. Army Tank-Automotive and Armaments 

Life Cycle Management Command 

Navy 

Office of the Deputy Assistant Secretary of 

the Navy (Acquisition & Logistics 

Management) 

Naval Air Systems Command 

Space and Naval Warfare Systems Command 

Naval Facilities Engineering Command 

Naval Inventory Control Point 

Naval Sea Systems Command 

Naval Supply Systems Command 

Office of Naval Research 

Military Sealift Command 

Strategic Systems Programs 

Marine Corps Systems Command 

Installations and Logistics, Headquarters, 

U.S. Marine Corps 

Air Force 

Office of the Assistant Secretary of the Air 

Force (Acquisition) 

Office of the Deputy Assistant Secretary 

(Contracting) 

Air Force Materiel Command 

Air Force Reserve Command 

Air Combat Command 

Air Mobility Command 

Air Education and Training Command 

Pacific Air Forces 

United States Air Forces in Europe 

Air Force Space Command 

Air Force District of Washington 

Air Force Operational Test & Evaluation 

Center 

Air Force Special Operations Command 

United States Air Force Academy 

Aeronautical Systems Center 

Air Armament Center 

Electronic Systems Center 

Space and Missile Systems Center 

Defense Advanced Research Projects Agency 

Office of the Deputy Director, Management 

Defense Business Transformation Agency 

Contracting Office 

Defense Commissary Agency 

Directorate of Contracting 

Defense Contract Management Agency 

Office of the Director, Defense Contract 

Management Agency 

Defense Finance And Accounting Service 

External Services, Defense Finance and 

Accounting Service 

Defense Information Systems Agency 

Defense Information Technology Contracting 

Organization 

Defense Intelligence Agency 

Office of Procurement 

Defense Logistics Agency 

Acquisition Management Directorate 

Defense Supply Centers 

Defense Energy Support Center 

Defense Security Cooperation Agency 

Contracting Division 

Defense Security Service 

Acquisition and Contracting Branch 

Defense Threat Reduction Agency 

Acquisition Management Office 

Missile Defense Agency 

Headquarters, Missile Defense Agency 

National Geospatial-Intelligence Agency 

Procurement and Contracting Office 

National Security Agency 

Headquarters, National Security Agency 

United States Special Operations Command 

Headquarters, United States Special 

Operations Command 

United States Transportation Command 

Directorate of Acquisition 

* * * * * 

[FR Doc. Z9–20416 Filed 8–28–09; 8:45 am] 

BILLING CODE 1505–01–D 


sroberts on DSKD5P82C1PROD with RULES