Citation: FEMA-1791-DR-TX, University of Texas Medical Branch, Animal Resource Center, Project Worksheet (PW) 12288
Cross-Reference: Hazard Mitigation
Summary: Resulting from Hurricane Ike, the first level of the University of Texas Medical Branch’s (Applicant) Animal Resource Center, Building 20, flooded to a depth of three feet, damaging the building and mechanical, electrical and plumbing (MEP) equipment. FEMA prepared PW 12288 for $814,272 for the repair of disaster damage to the building and MEP equipment. The Applicant proposed to construct a second level addition to Building 20 and to relocate the MEP equipment to the new addition as a hazard mitigation proposal (HMP) for $952,431. FEMA prepared a Benefit Cost Analysis (BCA) using an effective life of 30 years for the equipment. The BCA resulted in a Benefit Cost Ratio (BCR) of 0.95; a BCR of 1.00 or greater is required to demonstrate that the mitigation measure is cost effective. FEMA determined that the HMP was ineligible and approved PW 12288 for $814,272. The Applicant submitted its first appeal asserting that FEMA had used an incorrect value (30 years) for the effective life of the mitigation in the BCA. The Applicant stated that a value of 50 years was more appropriate for the proposed mitigation measure. A 30-year effective life is the appropriate value for equipment; however; the Applicant maintained that the mitigation measure is the construction of an addition to a building, not equipment. The appropriate effective life for a building is 50 years and using this value for effective life of the mitigation would result in a BCR to greater than 1.00. The FEMA Region VI Regional Administrator denied the first appeal stating that it chose the equipment value because hazard “mitigation measures must be related to eligible disaster-related damage and the applicant’s proposed addition sustained no damage during the event.” The Applicant submitted a second appeal maintaining its position relative to the effective life of the proposed mitigation measure – the construction of a second-floor addition.
Issues: 1. Did FEMA use the appropriate value for project useful life in its BCA?
2. Is the HMP cost-effective?
Findings: 1. No. The appropriate value is 50 years.
Rationale: FEMA Disaster Assistance Policy DAP9526.1, Hazard Mitigation Funding Under Section 406 (Stafford Act), dated July 30, 2007, FEMA BCA Reference Guide, June 2009