2024-17909. Hazard Mitigation Grant Program Application Period Extension

Table 1—10-Year Familiarization Costs, Discounted and Annualized

[$2023]

Year	Undiscounted	3 Percent	7 Percent
1	$4,686	$4,550	$4,379
2	312	294	273
3	312	286	255
4	312	277	238
5	312	269	222
6	312	261	208
7	312	254	194
8	312	246	182
9	312	239	170
( print page 66248)
10	312	232	159
Total	7,494	6,908	6,280
Annualized		810	894

FEMA cannot predict whether applicants will spend additional time on their grant applications as a result of the extension. However, FEMA expects extending the application period by 3 months for HMGP assistance will not increase costs to HMGP applicants or to FEMA. Applicants will have more knowledge about the amount of money they will have to spend at 15 months because the “lock-in” generally occurs at 12 months; the extension allows for 3 months of additional time, post-disaster, to recover and identify areas for improved resiliency in their communities. FEMA expects the additional time will help applicants ensure application information is accurate and includes necessary mitigation projects. The ability to reopen the application period is not allowed under current regulations, so this will add additional costs to FEMA and applicants. An applicant will have to dedicate time to request the reopening, and FEMA will have to review and approve or deny the reopening based on statutory authority to do so. However, since this has not been done before, FEMA does not have historical data to estimate the time and staffing requirements to reopen an application period.

Benefits

This rule will reduce the application burden for applicants and FEMA by extending application deadlines to a more reasonable timeframe. These timeframes will allow applicants to collect information and submit the application to the FEMA Region and receive approval without the additional steps involved in requesting extensions from FEMA Regional Administrators and FEMA Headquarters. Additionally, this rule will decrease the burden on FEMA of processing application extension requests.

FEMA estimated cost savings to the Federal Government by multiplying the reduction of work hours for FEMA staff to review and process the extension request by the hourly-loaded wage rates. HMGP regional staff estimate a time burden between 3-5 hours per extension request, which includes multiple levels of review. FEMA used an average estimate of 3.5 hours for a Regional Office review and 4 hours for a Headquarters review. FEMA used Step 5 of the General Schedule to account for the average experience level of Federal employees, and added a 23.25 percent average locality multiplier to account for average locality pay across the United States ^[41] to the 2023 General Schedule (Base) ^[42] pay, as well as a 1.45 percent benefits multiplier.^[43] For example, a GS-12 Step 5 working in a Regional Office would have an estimated hourly compensation of $69.00 (base wage of $38.61 × 1.2325 average locality adjustment × 1.45 wage multiplier). Table 2 shows the breakdown of time and wages for FEMA staff to review and approve extension requests.

Table 2—Review of HMGP Extension Requests (2023$)

Type	Grade level	Hours	Fully-loaded wage rate 44	Total opportunity cost savings
Regional Extension *	12	2.5	$69.00	$172.50
	14	0.5	96.95	48.48
	15	0.25	114.05	28.51
	† SES	0.25	123.09	30.77
Total per Request				280.26
HQ Extension ^	12	2.5	74.17	185.42
	14	0.5	104.23	52.11
	15	0.25	122.60	30.65
	13 (Legal Review)	0.5	88.20	44.10
	SES	0.25	123.09	30.77
Total per Request				343.05
* Office of Personnel Management 2023 Pay and Leave Table (Base Schedule with 23.25% increase for average locality differential). Available at https://www.opm.gov/​policy-data-oversight/​pay-leave/​salaries-wages/​salary-tables/​pdf/​2023/​GS_​h.pdf. (Wage rates multiplied by 1.2325) (last accessed on August 1, 2024). ( print page 66249)
† Senior Executive Service January 2023 Pay and Leave. Available at https://www.opm.gov/​policy-data-oversight/​pay-leave/​salaries-wages/​salary-tables/​23Tables/​exec/​html/​ES.aspx. (last accessed on August 1, 2024). FEMA used the midpoint of the salary rage ($141,022 to $212,100) of $176,561 and applied a multiplier of 1.45 to obtain yearly compensation of $256,013. Yearly salary was divided by 2,080 to estimate hourly compensation of $123.09.
^ Office of Personnel Management 2023 Pay and Leave Tables for the Washington-Baltimore-Arlington, DC-MD-VA-WV-PA locality. Available at https://www.opm.gov/​policy-data-oversight/​pay-leave/​salaries-wages/​salary-tables/​pdf/​2023/​DCB.pdf (last accessed on August 1, 2024).

FEMA estimates that this rule will reduce the number of extension requests by 6.9 per year for the Regional Administrators and 7.4 per year for FEMA Headquarters. This will lead to a cost reduction of $1,934 (6.9 requests × $280.26) per year for Regional extensions and $2,539 (7.4 requests × $343.05) per year for Headquarters extensions.

FEMA estimated the cost savings to applicants of this rule by multiplying the reduction of work hours for an applicant to compile information and submit the extension request by the annual number of extension requests and by the appropriate wage rate. HMGP regional staff estimate the time burden for applicants to be 3-5 hours for each extension request; FEMA used the average estimate of 4 hours. FEMA estimates the average number of extension requests to be 14.3 (6.9 Regional + 7.4 Headquarters) per year, and the fully-loaded ^[45] hourly wage rate for a State Government Emergency Management Director to be $55.78.^[46] FEMA estimates applicant cost savings of $223.12 ($55.78 × 4) per extension request and a total cost savings to applicants of $3,191 ($223.12 × 14.3 requests).

The total quantified cost savings from this rule are $4,473 ($1,934 + 2,539) in cost savings to FEMA and $3,191 in cost savings to HMGP applicants totaling $7,664 in cost savings per year. FEMA was unable to estimate the benefits from reopening the application period due to a lack of historical data. FEMA expects that additional cost savings will exist by diminishing the need to reopen the application period for numerous applications but cannot quantify those cost savings.

Transfer Payments

FEMA is not able to estimate the impacts on transfer payments of this rule. FEMA expects no changes in the number of HMGP grants approved, or the amount of funding obligated as total HMGP funding is limited by a “lock-in,” which acts as a ceiling for assistance available to a recipient, including its subrecipients. The level of HMGP assistance available for a given disaster is based on a percentage of the estimated total Federal assistance under the Stafford Act, excluding administrative costs for each major disaster declaration.^[47] However, FEMA is unable to estimate if the changes will affect the amount of funding that is obligated but unused by applicants. Between 2013 and 2022 approximately 18.22 percent of HMGP funds were returned to the Disaster Relief fund due to a number of factors, including insufficient time for recipients to submit applications. This amount also includes withdrawn applications, ineligible applications, or applications found to not be cost-effective by FEMA. Because application time constraints were only one factor in the amount of HMGP funds not expended, FEMA is unable to estimate the amount of transfers that can be expected from this rule.

Alternatives Considered

FEMA considered extending the application period to 18 months instead of 15 months, with no changes to the Regional Administrator's ability to extend. While the average application period duration including extensions is approximately 19 months. Major disasters with extraordinary circumstances, which are far less common than typical disasters, raised the average significantly. FEMA chose to increase the application period to 15 months to balance the need to provide assistance quickly while ensuring appropriate oversight for more complex disasters. In addition, requesting additional time for Regional Administrators to authorize ( i.e., two 120-day extensions instead of two 90-day extensions) will address most outliers that need to extend beyond 15 months.

Conclusion

FEMA believes this rule is necessary due to historical timeframes for HMGP applications exceeding what is currently allowed by regulation. Under current practice, the majority of HMGP applications must be extended by FEMA regions and FEMA Headquarters. This creates an unnecessary burden to both FEMA and HMGP applicants that increases the costs of submitting these applications as well as project delays under the current process for requesting extension. The extensions provided by this rule will result in cost savings to both FEMA and HMGP applicants, as well as streamline the process for a substantial number of applicants who will no longer be required to navigate a cumbersome process of requesting extensions through the Regional Administrator and FEMA Headquarters. The cost savings associated with this final rule show why extending the HMGP application period will be beneficial. Additionally, this rule will allow FEMA more flexibility to reopen HMGP application periods when needed and to reopen application periods if an applicant successfully appeals a denial. This rule will ensure HMGP funds are more efficiently allocated. ( print page 66250)

Table 3—OMB Circular A-4 Accounting Statement (2023$)

Category	3 Percent discount rate	7 Percent discount rate
BENEFITS:
Annualized Monetized	$7,664	$7,664
Qualitative (unquantified) benefits	• More likely to use available HMGP funds due to greater likelihood of grant approvals
COSTS:
Annualized Monetized	$810	$894
Qualitative (unquantified) costs	N/A
TRANSFERS:
Annualized Monetized	$0	$0
Qualitative (unquantified) Transfers	• Increased number of approved HMGP grants up to the maximum available funding per declared disaster
From/To	FEMA to HMGP recipients and subrecipients
Effects on State, local, and/or Tribal governments	• Extends the HMGP application deadline for States, Territories, and the District of Columbia as well as 565 Federally recognized Tribes
Effects on small businesses	• Not estimated
Effects on wages	None
Effects on growth	None