FEMA has developed resources for applicants and subapplicants to use while navigating the cost-effectiveness requirement for hazard mitigation projects.
Search by title or use the filters below to find BCA Toolkit resources, existing Pre-Calculated Benefits, ecosystem services and general reference guides, as well as training materials for instructors and students.
This guidance provides instructions for how to complete a cost-effectiveness narrative needed for FEMA to validate the cost-effectiveness for each HMA program and how to determine the number of people benefitting from a proposed mitigation project.
FEMA Policy 206-23-001
This policy supports the implementation of federal guidance provided by OMB Circular A-94, Appendix D to update the discount rate used in Benefit-Cost Analyses (BCA) of hazard mitigation projects. In accordance with the principles of OMB Circular A-94, FEMA will adopt the A-94 discount rate of 3.1%. It also includes streamlined cost-effectiveness determination methods, such as allowing subapplicants to submit a cost-effectiveness narrative, rather than a BCA, for projects costing less than $1 million. FEMA will continue to engage with OMB to improve implementation of FEMA’s cost effectiveness requirements to enable FEMA’s strategic goals and accelerate risk reduction and adaptation nationwide.
FEMA Policy FP-108-024-02: This policy allows for ecosystem service benefits to be included in a mitigation project’s Benefit Cost Analysis (BCA) regardless of the Benefit-Cost Ratio (BCR). Ecosystem service benefits are positive effects provided to people by nature, such as aesthetic value, air quality, recreation space, and water filtration.
By removing the previous BCR threshold, ecosystem service benefits can be used for all project types eligible under the Hazard Mitigation Assistance (HMA) and Public Assistance (PA) 406 mitigation programs that support the incorporation of ecosystem service benefits and result in the improvement of the natural environment.
This policy was effective from September 28, 2020 through March 22, 2023.
FEMA is announcing an increase in program accessibility for communities for the fiscal year 2022 Building Resilient Infrastructure and Communities (BRIC) and Flood Mitigation Assistance (FMA) grant program application cycle through use of an alternative cost-effectiveness method that will modify the threshold for certain mitigation projects to be cost-effective under limited conditions.
