FEMA Program Support Material

October 2023 1 

Demonstrating Cost-Effectiveness for

Projects Less than $1 Million

FEMA is providing greater access to its Building Resilient Infrastructure and Communities 

(BRIC) and Flood Mitigation Assistance (FMA) grant programs by addressing one of the 

challenges identified by our partners: the successful completion of a project Benefit-Cost 

Analysis (BCA).

For the Fiscal Year (FY) 2023 BRIC and FMA grant cycle, subapplicants may submit a costeffectiveness narrative, rather than a BCA, for projects costing less than $1 million. This 

Program Support Material provides instructions for how to complete a cost-effectiveness 

narrative needed for FEMA to validate the cost-effectiveness of the proposed project. 

Overview Applicants and subapplicants applying for BRIC and FMA must provide a BCA or other documentation that validates 

cost-effectiveness. For the FY23 BRIC and FMA grant cycle, subapplicants may provide a cost-effectiveness narrative 

for projects with a total cost of less than $1 million. Total project costs for purposes of demonstrating cost 

effectiveness include all project costs required to complete the mitigation activity. Refer to the Hazard Mitigation 

Assistance Program and Policy Guide Part 5.C.1.2: Project Costs for additional details. 

FEMA will then validate the project’s cost-effectiveness and estimate a Benefit-Cost Ratio (BCR) for the project 

during its review. Projects with a total cost of less than $1 million that qualify for BCA Assistance are not required to 

submit a cost-effectiveness narrative. In no case will FEMA award a hazard mitigation project that is not costeffective. 

A cost-effectiveness narrative is a written description, including both qualitative and quantitative data, of how a 

proposed mitigation project would benefit the community by protecting lives and the built environment. This Program 

Support Material describes the elements of a cost-effectiveness narrative. Additional context and guidance for the 

concepts described in this Program Support Material can be found in the FEMA Hazard Mitigation Assistance

Program and Policy Guide.
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How to Complete a Cost-Effectiveness Narrative

For projects with a total cost of less than $1 million, subapplicants may submit a cost-effectiveness narrative that 

FEMA will use to validate a project’s cost-effectiveness and estimate a BCR. In order to provide FEMA with enough 

data to estimate the project BCR, subapplicants should ensure they address the following questions in their 

narrative: 

 How often does the hazard being mitigated occur?

− For example: “Power outages occur at the Hazardtown fire station about once every 3-5 years.”

 How many people benefit from the proposed mitigation project, and how was this number determined? (See

Table 1 for more information on how to determine the project’s benefitting population for purposes of the costeffectiveness narrative.)

− For example: “The proposed mitigation project, installing a generator at the Hazardtown fire station, benefits

the fire station’s service population of 700 residents.”

 What structures, infrastructure, and/or building contents, if any, will be damaged if the project is not

implemented?

− For example: “If the proposed mitigation project is not implemented, Hazardtown Middle School will continue

to experience flooding in the auditorium and classrooms on the north side of the building, damaging school

equipment and resulting in costly mold remediation.”

 What public services (including public safety, transportation, and utilities) and/or businesses, if any, would lose

function during future hazard events if the project is not implemented?

− For example: “If the culvert under Overflow Road at Muddy Creek is not upsized, Overflow Road will continue

to flood during intense rainfall events and impede access to the Muddy Creek Shopping Center.”

 Are there any additional benefits directly attributable to the proposed project that are not captured elsewhere in

the cost-effectiveness narrative?

− For example, would the project result in avoided injuries or deaths; reduced emergency management costs;

reduced maintenance costs; protection of cultural, historical, or agricultural resources; reduced carbon

emissions; or other economic benefits to the community?

FEMA GO Instructions

 The cost-effectiveness narrative should be in Microsoft Word or Adobe PDF format and attached in the CostEffectiveness section of the FEMA GO subapplication.

 For the question “How was cost-effectiveness determined for this project?” the subapplicant should select

“Other BCA methodology approved by FEMA in writing.”

 For the total project benefits, enter a value equal to the project cost.

 For the question “Was sea level rise incorporated into the flood elevations in the BCA?” select “No.”

 For the question “Were environmental benefits added to the project benefits?” select “No.”

 For the question “Were social benefits added to the project benefits?” select “No.”
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Additional Information and Resources

For questions about developing a cost-effectiveness narrative, contact the BCA Helpline at bchelpline@fema.dhs.gov

or 855-540-6744 (toll free). For Building Resilient Infrastructure and Communities and Flood Mitigation Assistance 

questions, call the HMA Helpline at 866-222-3580. 
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Appendix A

Table 1: How to Determine Number of People Benefitting from Proposed Mitigation Project

Project Type Examples of Benefitting Population

Property acquisition for open space

- Residential structures: Number of people living in home or building

- Commercial, industrial, or recreational structures: Average daily

number of workers and/or customers

- Utilities: Number of customers served by the facility being mitigated

- Critical facilities, including police stations, fire stations, hospitals, or

other government facilities: Service population

- Schools: Number of students

- Roads and/or bridges: the average daily traffic (ADT) count of the

portion being mitigated

- Number of people living or working in the geographic area directly

impacted by the proposed mitigation activity

Mitigation reconstruction

Structure elevation

Floodproofing

Stabilization

Flood risk reduction: localized flood 

risk reduction

Flood risk reduction: non-localized 

flood risk reduction

Wildfire mitigation

Warning system

Aquifer storage and recovery

Retrofit: Structural retrofit

Retrofit: Non-structural retrofit

Retrofit: Seismic structural retrofit

Retrofit: Seismic non-structural retrofit

Retrofit: Wind retrofit

Retrofit: Wildfire retrofit

Retrofit: Snow retrofit

Secondary power source: Generator

Secondary power source: Solar 

photovoltaic system

Secondary power source: Microgrid

Secondary power source: Backup 

battery power system

Tsunami vertical evacuation refuge - Occupancy of vertical evacuation refuge or safe room

Safe room

Other innovative solutions - Number of people directly impacted by proposed mitigation activity