May states, territories and the District of Columbia demonstrate the 25% cost share for administrative costs through the costs incurred to administer underlying state-funded benefit payments made to eligible claimants?

Yes, states, territories and the District of Columbia may use the costs incurred to administer underlying state-funded benefit payments made to eligible claimants in order to demonstrate that the 25% cost share for their federal LWA award has been met.  If a state or territory chooses to do so, they must be able to allocate which costs were incurred to administer the underlying benefit payments to (1) only those claimants who were eligible for LWA, and (2) only during the six week period for which FEMA provided funds.