Applicants must comply with federal procurement regulations as a condition of receiving PA funding for contract costs for eligible work. The Applicant did not comply with federal procurement requirements by entering into a noncompetitive procurement and using a time and materials contract without a ceiling price. FEMA’s enforcement remedies in noncompliant procurement transactions are discretionary and include disallowing all or part of the cost of the activity or action not in compliance. To the extent FEMA allows funding notwithstanding procurement violations, FEMA may base funding on the reasonableness of the costs. FEMA has the discretionary authority to disallow funding as an enforcement action, which was appropriate here based on the circumstances and the lack of a cost analysis demonstrating reasonableness of the additional costs claimed.

The Applicant did not comply with federal procurement requirements and, additionally, has not demonstrated the claimed contractor DAC is reasonable. Therefore, this appeal is denied.

2 C.F.R. §§ 200.318(a),(j), 200.319, 200.320(f)(2), 200.323(a), 200.338, 200.403, 200.404(a); 44 C.F.R. 206.206(a). PAPPG, at 30, 32, 38, 133. City of Pierre, FEMA-1984-DR-SD, at 7; City of Key West, FEMA-4337.DR-FL, at 4; E. Baton Rouge Sch. Bd., FEMA-4277-DR-LA, at 2.