Avoiding Future Losses

March 2, 2021
How utilities can use HMGP funds to mitigate future winter woes

After last fortnight’s crushing winter weather, many local governments and water utilities are probably asking “what do I do now?” According to AccuWeather, the total economic impact from the winter storms could be as high as $50 billion. Following a Presidential Disaster Declaration, such as the one declared on February 19th for Texas, FEMA is providing several funding sources for impacted states.  The Hazard Mitigation Grant Program (HMGP) is one such funding source.

What is a Hazard Mitigation Grant?
FEMA provides HMGP grant funding for projects that will reduce the long-term vulnerability to natural hazards such as hurricanes, floods, earthquakes, and severe winter storms, among others. In the case of a severe winter storm, an HMGP grant could be used to reduce the potential for damages or loss of life by winterizing generators and electrical systems. In the case of a flood-related disaster, HMGP funds might be used for drainage infrastructure projects or home elevations.

Why is HMGP important?
HMGP is an important program because it reduces future hazard vulnerability. Because it has happened before, a particular disaster is within the realm of possibility. This means it can occur again. After mitigation actions are undertaken, if the disaster occurs again, the severity of the results will be lessened. There will be less loss of life and less damage to property. The HMGP supports efforts that ensure that natural hazards do not become disastrous.

How does it work?
The HMGP program opens after a Presidential Major Disaster Declaration. The total funding available for the HMGP program is dependent on the total amount of disaster relief requested immediately after a disaster. This ensures that the most damaging events receive the most HMGP funding, and that mitigation dollars are spent in a manner that most effectively reduces future damages. While the current allocation for this disaster is unknown, the HMGP allocations can be significant. After Hurricane Harvey, almost $300 million was allocated to the state of Texas in HMGP funds.

What projects are eligible for HMGP funds? What does not qualify for HMGP?
Because HMGP is focused on reducing future damages, projects that address immediate disaster recovery, repair, or maintenance are not eligible under the HMGP. Other grants, such as the FEMA Public Assistance program, may be appropriate for immediate, post-disaster recovery funding. Projects that provide a long-term reduction in future damages, such as retrofitting, emergency generators, and studies such as water system evaluations or flood studies are eligible for HMGP funding.  HMGP funding is provided at a 75/25 federal/local cost share. The HMGP program will cover 75 percent of costs for eligible projects. The remaining 25 percent local share can be provided in cash, in-kind services, or in local labor or equipment.   

While HMGP is open to all jurisdictions in the state and to projects that mitigate any natural hazard, preference is given to the most impacted jurisdictions and to projects that mitigate the same hazard type as in the disaster declaration. This ensures that mitigation efforts are used to address the most pressing mitigation needs. In this upcoming allocation, a jurisdiction could apply for funding to carry out a mitigation project to reduce drought vulnerability. However, FEMA would prefer to fund projects that mitigate the effects of severe winter weather. The damages suffered in this severe winter weather disaster demonstrate that funding is required to help bolster mitigation efforts that reduce vulnerability to similar future events.

How can agencies apply for HMGP funds?
Agencies should contact their State Hazard Mitigation Officer to apply for HMGP. At the time of this writing, only the state of Texas has received a major disaster declaration for February winter storms. Applicants in Texas should submit an application through the Texas Division of Emergency Management. The HMGP application has not yet been opened. However, it is expected that the HMGP application process will begin in late spring. Once opened, the HMGP application window will be open until February 19, 2022, one year after the disaster declaration.

While the HMGP process differs for each allocation, it generally follows a predictable process. Applicants will first submit a Notice of Intent (NOI), indicating that they intend to pursue funding under HMGP. The NOI is a short form that will provide information about the applicant and the project. Once the NOI is submitted, the applicant will need to work on the full HMGP application, including a benefit-cost analysis that demonstrates the cost-effectiveness of the project, and submit the full application and benefit-cost analysis before the application deadline.

Access to HMGP funds can help ensure that a community or utility can avoid repeating the same predictable fate after every disaster. Simply rebuilding as before will leave a community or utility just as vulnerable as they were before the disaster hit. Mitigating against future hazards is essential for a long-term resilience strategy. Studies show that every dollar provided by federal hazard mitigation grants prevents six dollars in future losses. Mitigation is a cost-effective tool to address hazard vulnerability. 

About the Author

Tak Makino

Tak Makino, CFM, is a flood mitigation manager at Lockwood, Andrews & Newnam, Inc. (LAN), a national planning, engineering and program management firm. LAN has assisted agencies with HMGP grant efforts for the last 10 years.