The Federal Emergency Management Agency determined this week that the state hospital in Waterbury was damaged but not destroyed by Tropical Storm Irene.
The decision is a setback for the Shumlin administration. It means the state does not qualify for 90 percent federal funding to replace the facility.
Despite the FEMA ruling, the administration remains confident that the feds will pay for some of the $43 million price tag to replace the state hospital.
But how much has yet to be determined. And both FEMA and Administration Secretary Jeb Spaulding say the final amount will be less than what the state had hoped for. Still, Spaulding sounded optimistic when he briefed lawmakers on Wednesday.
"We are making significant progress," according to Spaulding. "And we will have the financial capacity – working with the institutions committees – to stay on track with the state hospital and the state office complex. There is no doubt in my mind."
FEMA spokesman David Mace says the law requires FEMA to make two findings in order for the state to qualify for 90 percent federal funding.
First, the buildings had to be destroyed. And second, the buildings have to be susceptible to repetitive heavy damage from natural disasters.
"In this case, FEMA determined the facility – the state hospital – doesn’t meet the qualifications to be classified as destroyed," he says. "Also, there hasn’t been an evidentiary showing that the building is and will be subject to repetitive heavy damage."
Mace says FEMA has other funding options for the hospital and state office complex.
"And we are working with the state to maximize the funding available through those other avenues," he says.
Gov. Peter Shumlin downplayed the importance of the FEMA decision. He says the agency told the state last June that the state hospital buildings would not qualify for the 90 percent funding.
"They had suggested that since the buildings weren’t destroyed, we were dealing with damaged, and they had sent us on a wrong path in the beginning," he says. "We have been for the last many months – since June – on the right path, which is to get all the dollars that we can that we deserve to rebuild the state hospital."
The final FEMA decision was delivered to the state on Tuesday. The state has 60 days to appeal, but Shumlin says an appeal may not be necessary.