FEMA Denies Cedar Rapids Sinclair Demolition Disposal Funds

CEDAR RAPIDS, Iowa - The Federal Emergency Management Agency will not reimburse the city of Cedar Rapids an estimated $6.5 million for part of the cost to remove and dispose of material from the former flood-damaged Sinclair meatpacking plant south of downtown.

FEMAs decision comes with a fault-finding explanation.

The agency concluded that it could not determine the reasonableness of the cost reimbursement sought by the city because the city made an "intentionally inaccurate representation" of the scope of the demolition work when it sought bids for the project, according to FEMAs written ruling to the state of Iowa and the city.

The agencys analysis suggests that the city lessened its estimate of the projects scope from 100,000 tons to 65,000 tons of demolition debris, which "may have influenced" the number of firms that would compete for the work. In the end, the project doubled in size without new, competitive bids as the project grew, the FEMA analysis states.

The latest denial comes from the federal agencys headquarters in Washington, D.C., and it is a denial of the citys second appeal on the Sinclair cost reimbursement issue. FEMAs regional office denied a first appeal nearly two years ago.

City Manager Jeff Pomeranz, and Joe OHern, the citys executive administrator for development services, on Monday called FEMAs new decision a final one.

"Theres nowhere else to go," Pomeranz said.

OHern said the city also continues to contest a different FEMA decision tied to the Sinclair plant that would deny the city another $3.5 million in reimbursement for damage at the Sinclair plant because of a private insurance award the city received from a fire that hit the plant after it was flooded. The city is still involved in its first appeal of the matter related to fire insurance, OHern said.

Both Pomeranz and OHern said they were "disappointed" with the new FEMA ruling.

Neither was with the city at the time that the Sinclair work was bid, but Pomeranz said he had confidence that the city acted in an "upfront, forthright manner."

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FEMA Denies Cedar Rapids Sinclair Demolition Disposal Funds