FEMA Riverine Flood benefit-cost software was used. The project generated a benefit-cost ratio (BCR) of 0.57, well below the 1.0 cost effectiveness threshold. The inputs used in the analysis were provided by the applicant. The BCR should be considered an upper-bound result, because several important numbers used in the calculation favored the applicant significantly. The following inputs (among others) were used:
The applicant's estimate that 1,100 acres of agricultural area would be given enhanced protection was used for the BC Analysis. A FEMA study showed that only 400 acres would actually be protected. The area used may overestimate the benefits by a factor of 2.75;
The applicant's estimated project cost of $279,500 was used. The FEMA study indicated, that if the structure were properly designed to function as proposed, the project costs would then be much higher;
The value of damages to infrastructure protected by the project is $11,350. This figure was provided by the applicant;
In the BC Analysis, the proposed project is presumed l00% effective in preventing damage up to 2.5 feet over base flood elevation (BFE). This favors the applicant because the proposed bank design (see later notes) makes it prone to breaching. If the potential for breaching was considered, the
effectiveness of the project would be diminished, as would the benefit-cost ratio.
The applicant provided a benefit-cost analysis that does not address essential elements of benefit-cost analysis, such as flooding recurrence probabilities and present value calculations. The FEMA-generated BC Analysis resulted in a benefit-cost ratio of 0.57, indicating that the project is not cost effective and is thus ineligible for HMGP funding.