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Federal Register / Vol. 86, No. 155 / Monday, August 16, 2021 / Rules and Regulations
reviewed how the NPRM discussed emergency versus major disaster determinations.
In the NPRM, FEMA limited arbitrations to major disaster declaration determinations at proposed 206.206b3iA since the right of arbitration is housed in paragraph d of Section 423 of the Stafford Act. Section 423 is under Title IV of the Stafford Act, which is entitled Major Disaster Assistance Programs. Also, subparagraph d5A of 423 of the Stafford Act states that the applicant shall submit to the arbitration process established under the authority granted under Section 601 of Public Law 111
5. FEMAs corresponding regulations under 206.209 are entitled Arbitration for Public Assistance determinations related to Hurricanes Katrina and Rita Major disaster declarations DR1603, DR1604, DR1605, DR1606, and DR
1607. Therefore, FEMA limited arbitration in the NPRM to major disaster declarations.
Yet, there was no corresponding limitation in the appeals section of the NPRM because applicants may appeal emergency declaration decisions. As a result of the deliberation surrounding a response to this comment, FEMA did discover that the NPRM imprecisely stated in the Executive Orders 12866
and 13563 section that this proposed rule does not apply to emergency disaster declarations. Rather, it should have stated that the Regulatory Evaluation does not include a discussion of emergency disaster declarations; since, arbitration is only available to dispute the determinations of major disaster declarations. There was no need to analyze the cost for applicants to appeal determinations of emergency disaster declarations in the NPRM, since FEMA currently allows for such and the NPRM did not limit appeals to major disaster declaration determinations. FEMA did not make any changes to the regulatory text at 206.206 as a result of this comment but it did update the Regulatory Evaluation as noted above.

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III. Summary of Other Changes The NPRM at 44 CFR 206.206a proposed to define the term urbanized area to mean the area as identified by the United States Census Bureau USCB. The USCB defines an urbanized area as an area that consists of densely settled territory that contains 50,000 or more people. For clarity and to comply with publication requirements found in 1 CFR chapter I, FEMA has revised the final rules definition of urbanized area as an area
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that consists of densely settled territory that contains 50,000 or more people.
FEMA realized that the NPRM at 206.206 was silent regarding the recipient-related first and second appeal time limits. Section 423a of the Stafford Act allows appeals within 60
days. Therefore, in the first appeal time limits portion of the final rule FEMA
aligned with this requirement by adding the following sentence at the end of 206.206b1iiA: A recipient may make a recipient-related first appeal within 60 calendar days from the date of the FEMA determination that is the subject of the appeal and must electronically submit their first appeal to the Regional Administrator. FEMA
also had to make a corresponding addition to the second appeal time limits portion of the final rule by adding the following sentence to the end of 206.206b2iiA: If the Regional Administrator denies a recipient-related first appeal in whole or in part, the recipient may make a recipient-related second appeal within 60 calendar days from the date of the Regional Administrators first appeal decision and the recipient must electronically submit their second appeal to the Assistant Administrator for the Recovery Directorate.
FEMA realized that the NPRM at 206.206b3iA does not follow the language of Section 423d1 of the Stafford Act, which says that an applicant for assistance may request arbitration to dispute the eligibility for assistance or repayment of assistance.
Rather, the NPRM at 206.206b3iA
states that an applicant may request arbitration if there is a disputed agency determination. Therefore, in the final rule FEMA is removing the phrase disputed agency determination from paragraph 206.206b3iA and adding dispute of the eligibility for assistance or of the repayment of assistance in its place.
FEMA also realized that the NPRM at 206.206b does not follow the language of Section 423 of the Stafford Act, which says that an applicant for assistance may request arbitration to dispute the eligibility for assistance or repayment of assistance. Rather, the NPRM at 206.206b says that an eligible applicant or recipient may appeal or an eligible applicant may arbitrate any determination previously made related to an application for or the provision of PA according to the procedures of this section. Because the regulatory text does not follow the statutory language, FEMA
is removing the phrase or an eligible applicant may arbitrate from 206.206b and FEMA is adding a second sentence to 206.206b that says:

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An eligible applicant may request arbitration to dispute the eligibility for assistance or repayment of assistance.
FEMA is making these technical changes because FEMA does not have the discretion to deviate from statutorily imposed restrictions. Section 423a of the Stafford Act allows an applicant to appeal any decision regarding eligibility for, from, or amount of assistance.
Whereas, Section 423d1 of the Stafford Act allows an applicant to arbitrate the eligibility for assistance or repayment of assistance. Since Congress did not use the same language, there is a difference between what an applicant can arbitrate and what an applicant can appeal, which FEMA must delineate in its regulations at 44 CFR 206.206. Since these requirements are statutorily imposed and FEMA has no discretion FEMA may make these edits as technical changes in the final rule.
Additional technical changes to the final rule are at 44 CFR
206.206b1ivB1 and b2ivB1 as the Office of Management and Budget OMB revised the cross references from 2 CFR 200.338
to 2 CFR 200.339; as, OMB revised sections of their Guidance for Grants and Agreements. See 85 FR 49506, Aug.
13, 2020.
The final rule also includes corrections of typographical errors and other non-substantive stylistic changes from the NPRM. FEMA made a typographical error under the Executive Orders 12866 and 13563 section Impartiality heading. In the NPRM, the Executive Orders 12866 and 13563
section stated that CBCA found in favor of the applicant fully or partially in less than 20 percent of the time. The 20
percent was a typographical error. It should have read 55 percent to align with the correct data, which was listed on Table 13 of the NPRM. In this final rule, the data for the Executive Orders 12866 and 13563 section has been updated with the most recent 10-years of available data at the time of the analysis. Therefore, FEMA has replaced less than 20 with about 13 in the final rule to make sure that the narrative of the percentage that the CBCA found in favor of the applicant fully or partially aligns with Table 13.
The final rule also includes other nonsubstantive changes from the NPRM.
For instance, FEMA added a footnote to the Executive Orders 12866 and 13563
section under the Cost to Government/
FEMA heading that FEMA estimates that we could need up to four expert witnesses. FEMAs expert witnesses may or may not speak at the hearing.
Additionally, FEMA may hire an expert witness so that FEMA can consult with
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