The Federal Emergency Management Agency denied the University of Iowa’s second appeal for funding to replace the Art Museum on Wednesday.

Yet despite the setback, state and university officials said they still plan to look for other ways to receive mitigation from the agency.

Pat Hall, the recovery bureau chief from the Iowa Homeland Security and Management Division, said administrators would continue working with FEMA to find other regulations in which the museum could qualify to receive funding.

"We’re looking at every option possible within FEMA guidelines," Hall said. "We’re always hopeful."

The UI Art Museum was damaged in the 2008 flood. In the university’s second appeal, officials argued the museum couldn’t be used as a fine-arts museum because of difficulties in obtaining insurance for the university’s art collection. Lloyd’s of London has said it will cease to insure the artwork in its present location — the building has been flooded twice.

Regent Robert Downer said he was not in agreement with the appeal denial.

"It is my personal opinion that the University of Iowa’s position in this is right both on the facts and on the law," he said. "I don’t know how far it may make sense to carry this, but I think the university is correct with respect to it."

Downer also said he believes that the Art Museum was an important part of the UI.

"I think the Art Museum is a vital resource for the university, and I hope that we can get that back on line soon," Downer said. "But this is very disappointing, and I think FEMA’s wrong on this."

Other state officials also expressed dissatisfaction with the decision.

"I am disappointed in this decision by FEMA," said Mark Schouten, Iowa Homeland Security and Emergency Management Division administrator in a press release. "We will work with the University of Iowa to evaluate our options."

FEMA spokesman Lars Anderson said agency officials determined the university’s difficulties in obtaining insurance for the current museum were not a direct result of the damage from the 2008 floods.

"The building continues to be eligible for funding for repair but not full replacement," Anderson said.

UI spokesman Tom Moore said university officials would still continue to work toward ensuring the university has a safe and reliable facility for the art collection.

"We are very disappointed that the state’s and the university’s appeal for the replacement of the University of Iowa Art Museum has been denied by FEMA," Moore said. "We are currently reviewing all options and have not yet decided on a specific course of action."

Downer said he hopes officials continue to explore other options.

"We always need to look at what may be the most cost effective and timely approach to these," he said. "I certainly will be encouraging them to move forward as best as we can."