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FEMA determines City of Brenham Ineligible for Funding for the Lake Somerville Raw Water Intake Structure

The Brenham City Council held an Emergency Session on Tuesday, March 22, 2022, to discuss an Eligibility Determination letter received on March 17, 2022, from the Federal Emergency Management Agency (FEMA) regarding the Lake Somerville Raw Water Intake Structure. FEMA has determined the project to repair damage to the structure is ineligible for public assistance funding.

As a result of severe storms and flooding from the May 2016 disaster, the City submitted a Request for Public Assistance from FEMA in late 2017. The initial request was for $479,223. In March 2019, the City requested a scope change and cost modification to install a soldier pile wall system to repair the embankment. FEMA processed the request for an increase of $741,124 bringing the total claim for damages to $1,174,924. The federal share amount was $883,575 or 75% of total project cost.

In July 2020, the City submitted another cost modification due to cost overrun. The letter indicated that due to higher-than-expected bids, the soldier pile wall system would cost an additional $3,821,891, bringing the total project cost to $4,499.991. Due to this large increase in cost, FEMA began an internal investigation. In August 2020, FEMA submitted a series of questions and asked the City to respond. Although the City responded to this request for information, in FEMA’s opinion the response was not satisfactory.

During the investigation and through a search of council meeting minutes, FEMA learned of pre-existing deterioration and deferred maintenance to the structure which led to the current determination of ineligibility of funding. FEMA does not provide funding for repairs of pre-existing damage caused by deterioration or deferred maintenance. In late 2020, when FEMA gave the City opportunity to provide documentation to support its claim that damage was caused by the disaster or to establish the pre-disaster condition of the structure, the City’s response purportedly did not include all of the information that FEMA was seeking. In March 2022, the City learned that FEMA had contacted the Office of Inspector General (OIG) alleging a complaint against the City and requesting the OIG review the allegation of the City’s failure to disclose pre-existing damages in the original disaster documentation. The City was informed in March 2022 that the OIG, after the United States Attorney’s Office declined prosecution, referred the incident back to FEMA for administrative action.

At present, the City has the right to appeal within 60 days of receipt of the March 17 letter, which is May 16, 2022, and intends to do so. As part of the appeal process, the City must return $883,575.30 to Texas Department of Emergency Management (TDEM) who will hold the funds in escrow until the appeal process is finalized. If the appeal is favorable, the funds will be returned to the City, and if not favorable, the funds will be returned to FEMA.

On March 18, 2022, the City also received a Letter of Concern from FEMA dated March 14, 2022, indicating that FEMA is considering pursuing administrative action against the City and considering debarment of the City from future procurement and non-procurement federal assistance. The City has engaged with FEMA and is cooperating with the agency’s inquiry.

Mayor Tate states, “As a result of the May 2016 disaster, the City was working with FEMA on 27 different projects for public assistance. If we inadvertently failed to disclose pre-existing damages, it was due to an oversight and was not intentional. We want to be transparent and provide the necessary documentation to support our request for reimbursement of expenditures related to repairs at the Lake Somerville Raw Water Intake Structure. City council and city officials are working diligently with TDEM and the appropriate legal counsel to ensure we are successful in the appeal process.”