Alternative Procedures for Permanent Work

• Insurance: applicants receiving permanent work funding must obtain and maintain insurance on insurable facilities and property (buildings, contents, equipment, vehicles), including those funded through alternative procedures (see FP 206-086-1).
• Appeals: FEMA does not grant appeals on alternative procedures projects, except for cost adjustments after the offer is accepted (such as insurance, noncompliance or audits). Disagreements over damage, scope or cost must be resolved before accepting. Denied extensions to accept an offer can’t be appealed.
• Inspector General: the DHS OIG can audit any project, including alternative procedures projects.

Proof that you obtained and maintain insurance on facilities funded through alternative procedures, and full procurement and cost records, since the OIG can audit these projects.

• Notify FEMA before scope changes that involve buildings or structures 45 years or older, ground-disturbing activities, or work in or near waterways.
• Except for buildings 45 years or older, changes that substantially conform to the approved scope (material substitutions, interior floor plan reconfigurations) don’t require notice.
• Changes affecting hazard mitigation must be approved within the 18-month deadline, and the fixed amount is adjusted.
• Work must be complete by the approved deadline. The recipient certifies that incurred costs relate to the approved scope and that work followed FEMA rules.
• The recipient submits its certification within 180 days of the subrecipient completing its last alternative procedures project or the latest project deadline, whichever comes first, for the subrecipient to keep excess funds.
• Subrecipients don’t track costs to specific line items; they substantiate and certify that claimed costs relate to the overall eligible work.

The recipient’s closeout certification with a final cost report covering: actual work completed, mitigation achieved, EHP compliance, civil rights compliance, obtain and maintain insurance compliance, total actual costs, procurement compliance, and actual insurance proceeds.

• Fixed cost funds may be shared across all alternative procedures projects for repair, restoration or replacement; new facilities including land acquisition; equipment; or cost-effective hazard mitigation.
• If mitigation funding is included, you must complete the approved mitigation scope to keep that funding.
• Excess funds may be used, once the approved scope is complete, for cost-effective risk reduction and to improve future PA operations or planning, as shown in the table.
• Submit a proposed scope and timeline for excess funds to the recipient within 90 days of completing your last alternative procedures project; the recipient forwards it to FEMA within 180 days. You can request an extension.
• FEMA reviews proposed uses for reasonableness and sets a completion deadline within the disaster’s period of performance.
• Category I projects cannot be included in alternative procedures projects. All work must otherwise be PA-eligible.

A proposed scope of work and timeline for any excess funds, submitted to the recipient within 90 days of completing your last alternative procedures project, and the recipient’s submission to FEMA within 180 days.

• FEMA works with engineers, architects, cost estimators and construction managers to develop or validate the estimate, then transmits it as a fixed cost offer through Grants Portal.
• If accepted, the project is an alternative procedures project. Obligation is FEMA’s acceptance of the fixed amount.
• FEMA treats the fixed amount as reasonable and eligible if there is no fraud and you comply with grant conditions, including procurement. Insurance proceeds and salvage values are credited.
• After agreement there are no further adjustments except for insurance and approved hazard mitigation scope changes. FEMA’s cost estimating format includes contingencies for hidden damage, unforeseen environmental and permitting requirements, and other unknowns.
• If you need only architecture and engineering first, you must define the actual scope of work before a fixed cost offer is sent.

FEMA’s fixed cost offer and its transmittal date; your and the recipient’s acceptance within 30 days; and any extension approved by FEMA’s Assistant Administrator for Recovery before the deadline.

• FEMA, the recipient and the applicant must agree on the damage description and dimensions, scope of work and hazard mitigation before the fixed cost estimate is developed, by FEMA or by you.
• Funding is capped at the federal share of the estimated cost to restore to pre-disaster design and function under eligible codes and standards, plus cost-effective mitigation tied to the restoration work actually performed.
• Allowable costs: architectural, engineering, environmental review and design fees; construction and other restoration costs, including permitting fees, project or construction management, and required codes, consensus-based codes and approved industry standards.
• Expert panel: a FEMA-funded independent panel of cost experts may review estimates. It addresses cost only, not eligibility, and is not used for appeals. FEMA may request it for any estimate; you may request it for projects with an estimated federal share of at least $5 million.
• Hazard mitigation: mitigation is a separate fixed amount in the subaward tied to the actual work planned. If capacity is increased, mitigation is limited to protecting the original capacity. If the approved mitigation isn’t completed, FEMA reduces the fixed amount by that portion.

The agreed damage description and dimensions, scope of work and hazard mitigation proposal; design, permitting and construction management cost information; and code and standard requirements.

• Standard procedures fund the pre-disaster size, capacity and function of a damaged facility based on actual costs.
• Section 428 lets FEMA fund large permanent work projects on fixed, capped estimates through alternative procedures. They can only be applied to large projects.
• Alternative procedures let applicants consider their community’s hazards, risks and vulnerability, with less itemized cost tracking and more flexibility in funding and restoration.
• See the table for the main differences in funds, tracking and scope changes.

Under alternative procedures you track total costs for all alternative procedures projects together, and show that the work relates to the approved scopes of work, rather than tracking costs by work item and project.