Oklahoma Department of Emergency Management
PO Box 53365
Oklahoma City, Oklahoma 73152-3365
RE: Second Appeal – City of Tulsa, Elm Creek Basin
DR-1883-OK, Project #48
Dear Mr. Ashwood:
This is in response to your letter dated December 26, 2013 to Tony Robinson, Regional Administrator, FEMA Region VI. The City of Tulsa is appealing the Regional Administrator’s decision to deny its request to provide Hazard Mitigation Grant Program (HMGP) funding in support of the proposed Elm Creek Basin project.
The City of Tulsa, Oklahoma proposes a 65-acre detention pond in order to reduce flooding in the Elm Creek Basin. The project’s central focus is the construction of a detention pond. The detention pond involves demolition, excavation, modification of the street elevations, relocation of storm sewers, sanitary sewer, and waterlines, and the construction of a safety rail around the perimeter of the proposed basin. The project scope of work indicates that thirty-one residential and non-residential properties would benefit from this project. Tulsa owns four parcels of land in the proposed location, but must purchase nineteen (19) right-of-way properties (14 with structures, 4 vacant lots, and 1 parking lot). The estimated construction duration is thirty-six months.
Region VI received an application from the State of Oklahoma (Applicant) on behalf of the City of Tulsa (Sub-applicant) on August 8, 2011. Three requests for information (RFI) were sent to the State in an attempt to ascertain additional information to calculate the Benefit Cost Analysis (BCA) and clarify the Scope of Work (SOW). The project application was denied in a November 20, 2012 letter from Frank Pagano, Mitigation Division Director, FEMA Region VI, citing deficiencies in the SOW, engineering feasibility and effectiveness, cost estimate, NEPA compliance and project eligibility. The first appeal was received by FEMA on March 28, 2013 and was denied by the Region for many of the same reasons in a letter dated August 27, 2013.
On November 19, 2013 the City of Tulsa submitted supplemental information in support of its second level appeal. The supplemental information addressed areas cited in the appeal denial letter from FEMA Region VI to include:
1. Project Scope of Work
2. Engineering Feasibility and Effectiveness
3. Cost Estimate / Cost Benefit Analysis
4. Overall Eligibility (44 CFR, Sec. 206.434, Eligibility)
The project file was reviewed by FEMA Headquarters to evaluate the complex issues identified in this case. The major findings of this review are as follows:
Feasibility and Effectiveness – The overall project was found to be feasible and effective. The review shows that of the 31 properties to benefit from construction of the proposed detention basin, 13 properties (42%) will be removed from the 100-yr (1% chance) floodplain. The remaining 18 properties (58%) will have reduced flood depths during the 100-yr (1% chance) event but still remain susceptible to flooding. After mitigation, all 31 properties will be above flood elevations for the more frequent 10-yr (10% chance) event.
Cost Estimate – A review of all cost data submitted with the appeal package indicates that the total project cost is actually $9.95M ($9,948,652) rather than the $8.47M ($8,474,452) cited in the application documents. This is due to costs associated with concrete for road construction ($1.4M) and other minor costs associated with storm drain relocations that were not accounted for in the overall budget.
Benefit Cost Analysis – FEMA Headquarters performed a reevaluation of the Benefit Cost Analysis to determine the validity of what was submitted by the applicant. Our reevaluation, using all of the inputs provided by the applicant, indicates that total benefits derived from protection of the 31 structures is $27,446,627. With a total project cost of $9.95M, the resulting BCR is 2.76. However, a closer review of the data indicates that the applicant is subscribing too many benefits to the structure located at 1802 S. Baltimore Ave. The assumptions pertaining to a complete shutdown of this structure during a flood event and the loss of use for an extended period of time cannot be substantiated or supported. The structure located at 1802 S. Baltimore Ave. provides $24.13M in benefits while the project as a whole yields $27.45M in benefits which accounts for 88.0% of total project benefits. FEMA’s reevaluation of the BCA yields a benefit cost ratio (BCR) of 0.33 demonstrating that this project is not cost-effective.
There is no requirement that mitigation projects meet a 100-yr event level of protection, so long as the project demonstrates the mitigation value, meets benefit-cost and all other grant eligibility requirements. While the overall project has been found to be feasible and effective, it appears that other mitigation alternatives may prove to be more so. The project will remove less than half of the structures from the 100 year floodplain and the benefits would accrue to primarily one structure. Given that one structure (1802 S. Baltimore Ave, a 10-story bank building) is providing the bulk of the benefits for this project, it may be more feasible and cost effective to merely provide some type of floodproofing mitigation for this single structure.
I have thoroughly reviewed all documentation that the State and the City of Tulsa submitted with this appeal and have determined that the Region’s decision on the first appeal is consistent with program regulations and policy. Therefore, I deny the second appeal.
Please inform City of Tulsa officials of my determination. My determination is the final decision on this issue in accordance with 44 CFR 206.440, Appeals.
Roy E. Wright
Deputy Associate Administrator for Mitigation
Federal Insurance and Mitigation Administration
cc: Tony Robinson, Regional Administrator, FEMA Region VI
Sandra Keefe, Director, Mitigation Division, FEMA Region VI
Anne Mack Vest, State Hazard Mitigation Officer, OK DEM