1. marcilopez@aol.com1 How an Electric Utility can get ready for FEMA Marci Lopez P.E.

2. marcilopez@aol.com2 In this presentation I am not representing FEMA, but am speaking as a former electric utility manager

3. marcilopez@aol.com3 What is the my Presentation Plan ?

4. marcilopez@aol.com4 My Presentation Plan  The first part of the Presentation will be an overview of those FEMA rules that most directly affect an electric utility.  I will assume that you are not familiar with the FEMA process. Therefore, feel free to ask questions as I review some important rules

5. marcilopez@aol.com5 My Presentation Plan  The second part of the Presentation will be a discussion of strategies the utility may want to take, with the goal of getting all of its eligible money as rapidly as possible.  At that time, I will ask you questions concerning the advantages and disadvantages of these strategies

6. marcilopez@aol.com6 Importance to an Electric Utility  While FEMA makes very sure the rules are well known, the typical electric utility does not often know how to use those rules to its best advantage  The Baseball Analogy

7. marcilopez@aol.com7 Does the actions of the electric utility really have an impact on the FEMA process ?

8. marcilopez@aol.com8 The utility’s capability to quickly provide FEMA with:  complete information will directly determine when the utility will get its money  accurate cost data will directly determine how much money the utility will get

9. marcilopez@aol.com9 What is the basic element of the FEMA process?

10. marcilopez@aol.com10 The Project A Project is a set of documentation which:  pertains to specific damaged facilities and equipment and the associated costs for their repair and replacement  pertains only to the costs of performing specific activities such as debris removal, temporary electric service restoration and handling of electric trouble calls

11. marcilopez@aol.com11 The documentation for a Project must include what elements ?

12. marcilopez@aol.com12 Documentation Elements  Damage Description and Dimensions  Scope of Work  Costs associated with the Scope of Work

13. marcilopez@aol.com13 What is a Damage Description ?

14. marcilopez@aol.com14 A Damage Description  A description of the specific cause of damage or condition (high winds, floodwater, shaking, fire)  Example- As a result of Hurricane Mary on April 17,2005, high winds damaged……

15. marcilopez@aol.com15 What are Damage Dimensions ?

16. marcilopez@aol.com16 Damage Dimensions  A description of the damages to a facility, including the damage dimensions  Examples- 5 poles, 400 ft of conductor, 127 conductor splices, 8 distribution transformers, Liberty Station 230 Kv bus, 4 tons of debris on right of way, 1200 service outages

17. marcilopez@aol.com17 What is a Scope of Work ?

18. marcilopez@aol.com18 Scope of Work  A description of the permanent repairs or replacement, debris removal and debris disposition, temporary repairs and handling service trouble calls  Examples – 10 distribution poles were replaced, 1000 ft of 15Kv conductor will be replaced,

19. marcilopez@aol.com19 How are Costs associated with the Scope of Work included in the Project submittal ?

20. marcilopez@aol.com20 Costs associated with the Scope of Work  Actual Costs are submitted as Cost Summaries and included as part of the Project  Future and Estimated Costs are included as part of the Scope of Work

21. marcilopez@aol.com21 For future work, what detailed cost estimates are required ?

22. marcilopez@aol.com22 Future Work Cost Estimates  Cost estimates should correlate with documented damage description and detailed scope of work  Cost estimates should be based on: Purchase prices Purchase prices Contractor bids Contractor bids Calculated Per Unit costs Calculated Per Unit costs

23. marcilopez@aol.com23 What are the most common FEMA work categories associated with an electric utility ?

24. marcilopez@aol.com24 Common Work Categories  Cat A Debris Removal  Cat B Emergency Protective Measures (Temporary Repairs)  Cat F Utilities (Permanent Repairs)  Each Project may only have one Category and one Declared County

25. marcilopez@aol.com25 What are Multiple Sites ?

26. marcilopez@aol.com26 Multiple Sites  Multiple Sites are damage sites having the same characteristics  For Debris Removal, multiple sites may be combined into one overall Damage Description and one overall Scope of Work  For Emergency Protective Measures, multiple temporary repair sites may be combined into one overall Damage Description and one overall Scope of Work

27. marcilopez@aol.com27 How are Multiple Sites for Lines handled ?

28. marcilopez@aol.com28 Multiple Sites for Lines  Multiple distribution line repair sites may be combined into one damage description with an estimated number of splices or length of line  Include a marked distribution line map of the conductor replaced or splices

29. marcilopez@aol.com29 Are there any Restrictions on Costs and Damages ?

30. marcilopez@aol.com30 Project Damages and Costs  The repair or replacement of a damaged facilities must be the utility’s legal obligation or responsibility  The facilities must have been damaged or the costs must have been incurred as a direct result of the storm.  Upgrades required to meet building codes and standards, at the time of the disaster,are eligible costs

31. marcilopez@aol.com31 How is Volunteer/Donated Labor handled ?

32. marcilopez@aol.com32 Volunteer / Donated Labor  Volunteer / donated labor can be used as credit for the non-FEMA allocation  FEMA will pay only for costs that were actually incurred by the Utility

33. marcilopez@aol.com33 What is Debris Removal ?

34. marcilopez@aol.com34 Debris Removal  Debris Removal involves removing debris from line rights-of-way, stations and utility property and disposing of the debris  For Force Account Labor, used for debris removal, only overtime is eligible.  For Contract Labor, used for debris removal, both regular time and overtime are eligible

35. marcilopez@aol.com35 What are Emergency Protective Measures ?

36. marcilopez@aol.com36 Emergency Protective Measures  Emergency Protective Measures involve the following: Answering electric trouble calls Answering electric trouble calls Performing temporary repairs and service restoration Performing temporary repairs and service restoration  For Force Account Labor, only overtime is eligible. For Contract Labor, both regular time and overtime are eligible

37. marcilopez@aol.com37 What is Permanent Repair ?

38. marcilopez@aol.com38 Utilities (Permanent Repair)  Utilities involves the permanent repair of facilities, equipment and lines  FEMA will pay to restore the facility to its pre-disaster condition

39. marcilopez@aol.com39 Who determines what is damaged ?

40. marcilopez@aol.com40 Damaged Facilities and Equipment  The Utility identifies the damage and the FEMA representative inspects the damage to determine whether it is eligible.  The FEMA representative must see the damage

41. marcilopez@aol.com41 What if repairs or replacement have to be made before FEMA arrives ?

42. marcilopez@aol.com42 Immediate Repairs or Replacement  Take pictures of the damage  Get the equipment repaired  If a qualified person states that it would cost more to repair then purchase, then purchase a replacement  Submit photos, a description of the damage, an estimated cost to repair and an invoice, if purchased

43. marcilopez@aol.com43 What is Hazard Mitigation ?

44. marcilopez@aol.com44 Hazard Mitigation  Mitigation involves evading costs for a future similar storm to the one that caused this damage  FEMA will usually pay an additional amount, of the cost to return the damaged facility to its pre-disaster condition, for hazard mitigation  For utilities, Mitigation is usually not timely

45. marcilopez@aol.com45 How is Insurance handled ?

46. marcilopez@aol.com46 Self Insurance  If the utility has an established self insurance plan with a schedule of covered facilities, then the covered facilities are not eligible up to the limit of self insurance

47. marcilopez@aol.com47 Insurance  Be prepared to provide FEMA with insurance documentation showing what facilities are insured  FEMA expects the utility to receive maximum recovery for the insured facilities  FEMA will usually pay the deductable

48. marcilopez@aol.com48 What typical costs are eligible for reimbursement ?

49. marcilopez@aol.com49 Typical Eligible Costs  Labor  Equipment (Vehicles/ Construction Equipment)  Rented Equipment  Material  Contract

50. marcilopez@aol.com50 For work that is completed, how is the cost information submitted to FEMA ?

51. marcilopez@aol.com51 Completed Work Summaries  Force Account Labor  Force Account Equipment  Rented Equipment  Material  Contract

52. marcilopez@aol.com52 Does the required information have to be submitted on FEMA Summary forms ?

53. marcilopez@aol.com53 Information Submittals  Required information does not have to be submitted on FEMA forms  If the utility can print out the required Summary information, FEMA will accept it

54. marcilopez@aol.com54 Who is included in Force Account Labor ?

55. marcilopez@aol.com55 Force Account Labor  Force Account Labor only includes the actual worker, directly performing the scope of work and his/her first level supervisor  If a higher-level person is actually performing the duties of either the worker or the first level supervisor, that person can be included provided you show the person’s actual title and use the pay rate for the worker or first level supervisor position

56. marcilopez@aol.com56 Can fringe benefits be included in Force Account labor costs ?

57. marcilopez@aol.com57 Fringe Benefits  Fringe Benefits can be can included as a percentage of the hourly regular time and overtime labor rates provided you show the components of those percentages  The same average fringe benefits percentages (regular time and overtime) may be used for all employees

58. marcilopez@aol.com58 What Equipment Cost Rates should be used ?

59. marcilopez@aol.com59 Equipment Cost Rates  For Force Account Equipment Costs, use the FEMA cost codes and equipment rates  The FEMA equipment rates do include fuel costs

60. marcilopez@aol.com60 How are material handling and warehousing costs included ?

61. marcilopez@aol.com61Material  For material costs, do not include handling or warehouse charges  For purchased material, show copy of invoice  Material Costs can include food, lodging and meals, provided these costs are part of legal agreements

62. marcilopez@aol.com62 Does FEMA impose any specific procurement requirements on contract work ?

63. marcilopez@aol.com63 Procurement of Contract Work  Use your established normal or emergency procurement procedures  Contract work is defined as work done by other than Force Account.

64. marcilopez@aol.com64 Mutual Aid Contracts  A mutual aid contract must be in place prior to the work being done  If possible, have the Mutual Aid contractor perform all of the Category B emergency protective measures work ( temporary work)

65. marcilopez@aol.com65 What are the definitions of a FEMA small and large project ?

66. marcilopez@aol.com66 Small and Large Projects  A Small Project is a project having a total value less than about $55,500.  A Large Project is a project having a total value greater than about $55,500.

67. marcilopez@aol.com67 Who determines whether a project is large or small ?

68. marcilopez@aol.com68 Small Project vs. Large Project  The utility defines the project and therefore determines if is a small or large project  The utility can take several small projects, having the same category of work, and combine them into a large project

69. marcilopez@aol.com69 How does FEMA treat a Small Project ?

70. marcilopez@aol.com70 Small Project  The Utility gets its money up front, whether the work has been started or not  If the utility does the work as defined by the scope of work and spends less, the utility keeps the difference  If the utility does the work as defined by the scope of work and spends more, then the utility pays the difference

71. marcilopez@aol.com71 How does FEMA treat a Large Project ?

72. marcilopez@aol.com72 Large Project  The utility gets the money only after it incurs the cost  When the utility finishes the scope of work and spends less, the utility will be reimbursed that amount  When the utility reaches the total cost amount and has not finished the scope of work, the utility can usually finish the scope of work and be reimbursed the additional amount

73. marcilopez@aol.com73 What are the more important elements of a Small and Large Project ?

74. marcilopez@aol.com74 More Important Elements  Small Project – The Cost Estimate & The Scope of Work  Large Project – The Scope of Work

75. marcilopez@aol.com75 What strategies should the utility define ?

76. marcilopez@aol.com76 Force Account Labor and Contracting  Debris Removal, includes removal, chipping or cutting up and disposal  Emergency Protective Measures, includes temporary repairs and handling trouble calls

77. marcilopez@aol.com77 Small and Large Projects  Criteria for identifying small and large projects  Advantages of small and large projects

78. marcilopez@aol.com78 What procedures should the utility consider implementing ?

79. marcilopez@aol.com79 Identifying Damages and Costs  Make every employee responsible for identifying any potentially storm related damages and costs in order to insure that FEMA submittals are complete

80. marcilopez@aol.com80 Document Code and County Name  All potentially storm related documents should have a code that identifies them as being storm related and the name of the county where that cost occurred

81. marcilopez@aol.com81 Damaged Equipment Procedure  Take photos of the damage  Get the equipment repaired  If a qualified technician states that it would cost more to repair then purchase, then purchase a replacement  Submit photos, a description of the damage, an estimated cost to repair and an invoice, if purchased

82. marcilopez@aol.com82 What Procedures should the Utility consider modifying ?

83. marcilopez@aol.com83 Storm Related Documents  Modify procedures to direct copies of all storm related documents to designated persons who will review and organize copies of the source documents for their organizational unit

84. marcilopez@aol.com84 Preparation of Actual Cost Summaries  Modify procedures to automatically prepare FEMA summaries from the original source data

85. marcilopez@aol.com85 What plans should the Utility consider developing ?

86. marcilopez@aol.com86 Hazard Mitigation Plans  An overall mitigation plan should be adopted and implemented as finances allow  Develop some standard mitigation schemes for specific facilities

87. marcilopez@aol.com87Remember  Disasters are going to happen and the utility will deal with FEMA  The costs of preparing now will be more then offset, especially if the utility is bleeding money to restore the electric system. The utility does not have the option of delaying system restoration

88. marcilopez@aol.com88 The payoff for a utility preparing in advance is a quicker reimbursement of the damage costs to which the electric utility is eligible

89. marcilopez@aol.com89 Thank you for your attention and participation