Benefit Cost Analysis
For all construction-oriented projects (e.g., structural flood improvements, elevations, and buyouts) to be eligible for FIF funding, both the costs and the benefits of proposed projects must be quantified and reported, that is, a Benefit Cost Analysis (BCA). Benefits may include property losses avoided, reduced risk of injuries or fatalities, and avoided economic disruption or environmental losses.
A Benefit/Cost Ratio (BCR) is the result of a BCA. A BCR must be reported with at least one decimal place (e.g., 1.1). A BCR greater than or equal to 1.0 is generally preferred to justify investments in the construction of flood projects. If the reported BCR is less than 1.0, the applicant must provide a detailed explanation of why the project is still justified, including any primary benefits that could not be quantified and therefore were not included in the BCR calculation.
As currently in the SFY 2024-2025 FIF Intended Use Plan, BCRs are not required t for the following FIF-funded project types:
- Flood Management Evaluations (FME) Category (formerly Category 1)
- Flood Management Strategies (FMS) Category (formerly Category 4)
-
Federal Award Matching Funds if:
- A BCA was developed and approved for a federal award (verification required), or
- The federal grant program generally requires a BCA but specifically exempts it for certain projects (e.g., lower-cost or non-construction projects).In these cases, the TWDB will also not require a BCA unless the proposed project is construction-oriented.
As stated in the draft SFY 2026-27 FIF Intended Use Plan, Flood Mitigation Projects (FMPs) are no longer required to submit the BCA with the abridged application or during project implementation.
BCA Tools
There are no specific BCA tools that must be used to determine the BCR. Free BCA tools that may be used include:
- FEMA BCA
- USACE BCA
- Benefit-Cost Analysis (BCA) Input Tool and Instructions: The TWDB funded and guided the development of a user-friendly spreadsheet interface developed with the TWDB fundingSummary of updates (01/26/2024)
BCA Guidance
- BCA Public Comment Notice
- Benefits Cost Analysis Guidance
- TWDB Guidance: Benefit-Cost Analysis Reporting for FIF Applications
- In Development: Guidance Document for Communities on Best Practices & Improvements for Completing a BCA (Public Comment open until July 15, 2026)
- Benefit Cost Analysis Template Example
BCA Contact
For questions on BCA, please emailFIF@twdb.texas.gov.