Cost Estimate

When an applicant requests public assistance  for disaster-related work, grant amounts are based on reasonable actual costs  if the work was completed at the time of the request. However, for work that  has not been completed at the time of the request, a Cost Estimate must be used.  Typically, these estimates are prepared using unit costs. With this method,  the project is broken down into elements based on the quantities of material  that must be used to complete the work. For example, a culvert repair may be  broken down into linear feet of pipe, cubic yards of fill, and square feet of  pavement. The estimate for each of these items is a cost per unit that  includes all labor, equipment, and material necessary to install that item  (referred to as an “in­ place” cost).
   Unit cost data developed by State or local  governments may be used for estimating costs if appropriate. Alternatively,  commercially available cost- estimating guides or data from local vendors and  contractors may also be used. Another choice is to use FEMA’s list of unit  costs (see Cost Codes)  for typical disaster repairs. It may be necessary for FEMA to review cost  data not based on established cost codes before approving a grant.
   For large or complex projects, it may be  necessary for the applicant to prepare a detailed design of the restoration  work before a viable cost estimate can be developed. In such cases, a grant  for engineering and design services is approved first (see Engineering and Design Services).  Once the design is complete, a cost estimate for the work is prepared or  actual bids for the work may be used as the basis for the grant (see Cost Estimating Format). Costs for  managing a project may also be included if the project is sufficiently large  or complex to require them (see Large Projects). Most small projects do not require project management above  the level of a first-level supervisor.
   A method of estimating would be to tally the  estimated cost of the labor, equipment, and materials for the project. Final  payments will be based on documentation of payroll information, equipment  logs or usage records, and by other records, such as invoices, receipts, or  work orders prepared by the applicant. This method also may be used for work  to be completed, if appropriate.
   References:   44 CFR §206.202(d)
   Public Assistance Guide, FEMA 322, pages 96,  103-106


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