University of Iowa gets FEMA funding for three flood-replacement projects

IOWA CITY - A federal government decision to pay to replace three flood-damaged University of Iowa buildings at new sites is good news for progress on university recovery, officials said, but also might have implications for flood recovery projects in Cedar Rapids.

The ruling by the U.S. Department of Homeland Security, announced Wednesday, settles a months-long dispute about whether the federal government will pay to repair the three UI buildings at their current sites or to replace the facilities at new sites, which was the original determination of the Federal Emergency Management Agency.

During the dispute, the UI moved forward with design work for a new Hancher Auditorium, School of Music and Art Building East, all damaged in the 2008 flood, and that continued work means progress was not slowed much, UI officials said.

“We've done that all along ... from day one,” Doug True, UI senior vice president of finance and operations, said. “It's a decision (state regents) took to keep us on track and now we aren't behind by even a month.”

The final ruling about the UI projects also likely is good news for Cedar Rapids flood recovery, said Mark Schouten, administrator of the Iowa Homeland Security and Emergency Management Division.

That's because FEMA funding for several replacement projects there, including the new downtown public library, was determined using the same criteria by FEMA that was called into question in the UI dispute, Schouten said.

“We hope this decision is broad enough and gives FEMA enough authority that the decisions they made in respect to Cedar Rapids also will be affirmed,” he said.

The U.S. Department of Homeland Security's Office of Inspector General just began an audit of the FEMA decisions on several Cedar Rapids flood replacement projects, Schouten said.

It was believed that the audit might seek to de-obligate about $38 million in replacement money on the Cedar Rapids projects, Schouten said, since the inspector general's office had questioned using the same criteria at the UI.

Officials now hope the Homeland Security ruling in the UI case sets a good precedent, he said.

Joe O'Hern, Cedar Rapids' executive director of development services and formerly the city's flood-recovery director, on Wednesday said the city of Cedar Rapids is not aware that the Office of Inspector General is looking at repair-versus-replace decisions by FEMA related to flood-damaged Cedar Rapids buildings.

But O'Hern said the city has known “it's one of the issues they could look at.” The city's new $46 million library is under construction at a new site and slated to open in August 2013.

In the university's case, about $83 million was at stake that had been obligated to the UI by FEMA. That's the difference between the estimated costs to repair current buildings and building new ones.

The final action on the federal funding for the replacement buildings “clears the way for construction - and we are ready,” UI President Sally Mason said in a statement.

Mason just last week told state legislators that further protracted delays on the federal decision would cost time and add expense for the three UI projects, but that she hoped an imminent decision would keep the impact to budgets and timelines minimal.

True on Wednesday said UI officials hope the projects will remain on schedule and at the projected budgets.

“We believe that we can achieve the dates that we've set out,” True said. “And the costs are best estimates, but the costs will be validated when we bid. That's when we find out if our estimates are right.”

It's expected the three replacement projects will cost about $420 million total, with FEMA covering about $270 million of that, True said.