City of Pembroke Pines v. Fed. Emergency Mgmt. Agency
| Decision Date | 04 January 2021 |
| Docket Number | Case No. 19-cv-62056-SINGHAL, Case No. 19-cv-62032-SINGHAL, Case No. 19-cv-81140-SINGHAL |
| Citation | 510 F.Supp.3d 1126 |
| Parties | CITY OF PEMBROKE PINES, FLORIDA, Plaintiff, v. FEDERAL EMERGENCY MANAGEMENT AGENCY and Peter T. Gaynor, in his official capacity, Defendants. City of Deerfield Beach, Florida, Plaintiff, v. Federal Emergency Management Agency and Peter T. Gaynor, in his official capacity, Defendants. City of Lake Worth Beach, Florida, Plaintiff, v. Federal Emergency Management Agency and Peter T. Gaynor, in his official capacity, Defendants. |
| Court | U.S. District Court — Southern District of Florida |
Michelle F. Zaltsberg, Baker Donelson Bearman Caldwell Berkowitz PC, Orlando, FL, Carolyn Stroud Ansay, Torcivia, Donlon, Goddeau & Ansay, P.A., Christy Lyn Goddeau, West Palm Beach, FL, Ernest B. Abbott, Pro Hac Vice, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Washington, DC, Wendy Huff Ellard, Pro Hac Vice, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Jackson, MS, for Plaintiff City of Lake Worth Beach, Florida.
Anthony C. Soroka, Weiss Serota Helfman Cole, Bierman P.L., Boca Raton, FL, Ernest B. Abbott, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Washington, DC, Michelle F. Zaltsberg, Baker Donelson Bearman Caldwell Berkowitz PC, Orlando, FL, Wendy Huff Ellard, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Jackson, MS, for Plaintiff City of Deerfield Beach, Florida.
Michelle F. Zaltsberg, Baker Donelson Bearman Caldwell Berkowitz PC, Orlando, FL, Samuel Stuart Goren, Goren Cherof Doody & Ezrol P.A., Fort Lauderdale, FL, Ernest B. Abbott, Pro Hac Vice, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Washington, DC, Wendy Huff Ellard, Pro Hac Vice, Baker, Donelson, Bearman, Caldwell & Berkowitz, PC, Jackson, MS, for Plaintiff City of Pembroke Pines, Florida.
Christopher Edward Cheek, U.S. Attorney's Office, Miami, FL, for Defendant Federal Emergency Management Agency, Acting Administrator of the Federal Emergency Management Agency.
ORDER GRANTING MOTION TO DISMISS CONSOLIDATED ACTIONS
Hurricane Wilma ravaged South Florida in 2005. Over fifteen years later, three Florida cities remain in a legal battle with the federal government over federal monies from the disaster-relief effort. In these consolidated actions, the Cities of Lake Worth Beach, Deerfield Beach, and Pembroke Pines (collectively, "Cities") seek judicial review of the U.S. Federal Emergency Management Agency's ("FEMA") determination that (1) the Cities’ administrative appeals were untimely and (2) as such, FEMA was without authority to consider the merits of the Cities’ administrative appeals. See generally Consol. Am. Compl. (DE [47]). FEMA moved to dismiss (DE [22]) the initial complaint. The Court referred the motion to Magistrate Judge Bruce E. Reinhart (DE [29]), who issued his Report and Recommendation ("R&R") (DE [39]). Judge Reinhart recommended the complaints be dismissed with leave to amend because, among other things, the Cities might be able to file an amended complaint that showed FEMA's determinations were not discretionary. The Court affirmed and adopted the R&R in full (DE [44]). The Cities have since filed the Consolidated Amended Complaint (DE [47]) and FEMA has again moved to dismiss (DE [50]).
The Court has reviewed the pleadings and is fully advised in the premises. The Cities still have not carried their burden in showing that FEMA's determinations were not discretionary—and they cannot do so. Therefore, for the following reasons, the motion to dismiss is GRANTED .
FEMA provides financial assistance to communities through its Public Assistance Program to help them recover from natural disasters. See 44 C.F.R. § 206.200 – .208. One of the many ways FEMA does so is through its grant assistance under the Stafford Act. See 42 U.S.C. § 5121 ; 44 C.F.R. § 206.203. The process is as follows: FEMA delivers the federal monies to a state agency (the "recipient"),1 and the state agency distributes the monies to the municipality (the "subrecipient"). See 44 C.F.R. § 206.202, .203.
In Florida, the Florida Division of Emergency Management ("FDEM") is the intermediary—the recipient—between FEMA and the municipalities. Thus, the monies flow from FEMA through FDEM to the municipalities.
FDEM applies for, and receives, the monies from FEMA; FDEM awards the funds to the municipalities as subrecipients. FDEM also serves as grant administrator, including facilitating all communication between FEMA and the subrecipients. Consol. Am. Compl. ¶ 21; see also 44 C.F.R. § 206.202(b).
FEMA uses Project Worksheets ("PW") to document the scope of work and cost estimates for projects seeking public assistance funding. Consol. Am. Compl. ¶ 20. Once a PW is approved, FEMA obligates the federal funding for the work described in the PW. Id. ¶ 22. The obligated funds are deposited into a federal "Smartlink" account to which recipient has access. Id. ¶¶ 23–24. These funds are provided to the subrecipients by the recipient after review of documentation showing that the work performed was within the scope of the approved PW, at a reasonable cost and in compliance with applicable grant requirements, and that the subrecipient actually paid for the work. Id. ¶ 24.
Section 705 of the Stafford Act governs disaster-relief grant closeout procedures. See 42 U.S.C. § 5205 (as codified). After the work authorized by the PW has been completed, FEMA executes a closeout process to ensure that all applicable administrative actions and required work have been completed, all contracts have been approved, and all costs expended were reasonable. See Consol. Am. Compl. ¶ 25. Based on the closeout findings, FEMA can deobligate funds. Separately, after this closeout process, the U.S. Department of Homeland Security Office of the Inspector General ("OIG") audits the work and recommends whether FEMA should deobligate funds. If funds are deobligated, FEMA electronically transfers those funds out of the Smartlink account, rendering the funds no longer available to the recipient or subrecipients.
Section 423(a) of the Stafford Act governs the appeal process. See 42 U.S.C. § 5189a(a) (as codified). All applicants for federal disaster relief assistance have a statutory right of appeal from "any FEMA decision regarding eligibility for, from, or amount of assistance [which] ... may be appealed within 60 days after the date on which the applicant for such assistance is notified of the award or denial of award of such assistance." Id. DHS regulations create a two-level appeal process: an appeal to the applicable FEMA regional administrator ("First Appeal"), and an appeal to the assistant administrator for the recovery directorate at FEMA headquarters ("Second Appeal"). See 44 C.F.R. § 206.206(b). The recipient must forward the subrecipient's appeal to the FEMA regional administrator within sixty days of receiving notice of the First Appeal. Id. § 206.206(c)(2). The regulations require the subrecipient to submit the appeal through the recipient. Id. § 206.206(a). In sum, the FEMA regional administrator decides the First Appeal and the assistant administrator for the disaster assistance directorate decides any appeal of the regional administrator's determinations. Id. § 206.206(b).
Lake Worth Beach is a municipal corporation located in Palm Beach County. See Consol. Am. Compl. ¶ 13. Unlike the other two cities joining this lawsuit, Lake Worth Beach had the misfortune of suffering extensive damage not just from Hurricane Wilma (2005), but also Hurricanes Frances (2004) and Jeanne (2004). Id. ¶¶ 33–34. Because it was located in a designated disaster area and owned and operated facilities damaged by Hurricanes Frances, Jeanne, and Wilma, the city was eligible for disaster assistance funding under FEMA's Public Assistance Program. Id. ¶ 160. The city requested public funds under the Public Assistance Program, id. ¶ 162, and FEMA approved the request, id. ¶ 163.
On FEMA's closeout process, more than seven years after Hurricane Frances and six years after Hurricane Wilma, FEMA deobligated $3,119,435.94 based on a variety of alleged eligibility issues. Id. ¶ 171. The city received notice of FEMA's closeout and OIG audit deobligations by letters dated December 21, 2011 and May 16 and 17, 2013, respectively. Id. ¶¶ 177, 182. The city submitted its notice of First Appeal of the FEMA closeout deobligations to FDEM on February 7, 2012. Id. ¶ 179.
FDEM forwarded the notice of First Appeal of the FEMA closeout deobligations on March 7, 2012. Id. ¶ 180. The city submitted its notice of First Appeal of the OIG audit deobligations on July 12, 2013. Id. ¶ 184. FDEM forwarded the notice of First Appeal of the OIG audit deobligations on July 19, 2013. Id. ¶ 185. According to the Amended Complaint, FDEM resubmitted the city's First Appeals on some date in 2014 "after FEMA had taken no action" on the appeals ... to ensure they were received." Id. ¶ 188.
From January 2015 through April 2018, FEMA began a process of sending the city three requests for information ("RFI"), seeking additional documentation, raising issues of the First Appeals’ timeliness, and informing the city that the record may not have contained sufficient information documenting that FDEM's compliance with the sixty-day statutory requirement. Id. ¶¶ 189–197.
Deerfield Beach is a municipal corporation located in Broward County. See Consol. Am. Compl. ¶ 12. Wilma's damage was extensive in Deerfield Beach. See id. ¶¶ 79–82. Its public beaches suffered erosion between two and three feet, requiring about 32,000 cubic yards of material to rebuild. Id. ¶ 82. The city prepared four PWs totaling approximately $11 million. Id. ¶¶ 92, 97, 109.
In April 2011, the OIG issued an audit report recommending that FEMA deobligate almost $4 million—what OIG asserted was "ineligible"...
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