Safeguarding Tomorrow RLF_FY25_Intended_Use_Plan_template_20250114_508.docx

Safeguarding Tomorrow Through Ongoing Risk Mitigation Revolving Loan Fund Program Intended Use Plan Template and Guidance January 2025

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Intended Use Plan Template and Guidance Table of Contents

Guidance for Completing the Intended Use Plan The intended use plan provides information to potential loan recipients and other interested parties about goals for the entity loan fund, the criteria for the distribution of loans, and the process for management of the loan fund.

The Federal Emergency Management Agency (FEMA) will review the intended use plan to make sure it is developed to meet the requirements outlined in 42 United States Code (U.S.C.) Section 5135(g) (https://www.govinfo.gov/content/pkg/USCODE-2020-title42/html/USCODE-2020-title42-chap68.htm): Grants to entities for establishment of hazard mitigation revolving loan funds and the relevant year’s Notice of Funding Opportunity. Table 1 has requirements from 42 U.S.C. Section 5135 to help entities make sure they have met all requirements. Entities must update their intended use plan each year to make sure they continue to comply with statutory requirements. These updates must be submitted by the end of the federal fiscal year, September 30. For entities that submit an intended use plan as part of an application package for a Safeguarding Tomorrow Through Ongoing Risk Mitigation Revolving Loan Fund (Safeguarding Tomorrow RLF) capitalization grant, the intended use plan submitted with the application will be considered to meet the yearly update requirement for the fiscal year in which the intended use plan is submitted.

Each section contains prompts to help the entity submit all needed information for the intended use plan. Each answer should contain, when it applies, background information, descriptions and reasoning, and relevant supporting details. The information in italics is there as a guide to help you draft your answers. All italicized content in the Intended Use Plan Template should be deleted and [Entity Name] replaced with the appropriate entity agency that will administer the fund before submitting the plan to FEMA. Text placed in brackets should be filled in or deleted by the applicant. For example, [YEAR] should be replaced with the relevant fiscal year.

As entities prepare their intended use plans and develop the project proposal lists, they should use evidence-based, best-available climate data sets, information resources, decision-support tools, and federal resources to identify current and future climate risks over the expected service life of the projects in their project proposal lists. Climate projections, emission scenarios, or other suitable scenario conditions should be specified based on the project’s service life and an entity’s risk tolerance, as appropriate and available. Entities should document how their planned project design and operations are resilient to any identified current and future climate risks.

Section 7 provides more resources.

Intended Use Plan Template and Guidance 1 Table 1: Intended Use Plan Requirements The Reference column sections can be found at 42 U.S.C. Section 5135. (https://uscode.house.gov/view.xhtml?req=granuleid:USC-prelim-title42-section5135)&num=0&edition=prelim)

in Intended Use Plan?

Section

Section 5135(g)(2)(A) ☐ Yes ☐ No Intended Use Plan Template Section 2.2.1

Section 5135(g)(2)(B)(i) ☐ Yes ☐ No Intended Use Plan Template Section 2.3.1

Section 5135(g)(2)(B)(ii) ☐ Yes ☐No Intended Use Plan Template Section 2.2.2

Section 5135(g)(2)(B)(iii) ☐ Yes ☐ No Intended Use Plan Template Section 2.2.2

Section 5135(g)(2)(B)(iv) ☐ Yes ☐ No Intended Use Plan Template Section 2.2.2

Section 5135(g)(2)(G) ☐ Yes ☐ No Intended Use Plan Template Section 2.2.3

Section 5135(g)(2)(G) ☐ Yes ☐ No Intended Use Plan Template Section 2.2.4

Section 5135(d)(3)(A) ☐ Yes ☐ No Intended Use Plan Template Section 2.3.1

Section 5135(f)(3) ☐ Yes ☐ No Intended Use Plan Template Section 2.3.1.1

Section 5135(g)(2)(C) ☐ Yes ☐ No Intended Use Plan Template Section 3.1

Section 5135(g)(2)(C) ☐ Yes ☐ No Intended Use Plan Template Section A.1

Section 5135(g)(2)(D) ☐ Yes ☐ No Intended Use Plan Template Section 3.2

Address last fiscal year’s loan fund financial status.

This is not required for new applicants.

42 U.S.C.

Section 5135(g)(2)(G) ☐ Yes ☐ No Intended Use Plan Template Section 4.1.1.1

Address current fiscal year’s loan fund financial status.

This is not required for new applicants.

42 U.S.C.

Section 5135(g)(2)(G) ☐ Yes ☐ No Intended Use Plan Template Section 4.1.1.2

Provide information on standard loan terms.

Initial loan term requirements are outlined in 42 U.S.C. Section 5135(f)(1)(A). Entities may change loan terms if they meet or exceed these standards. Loan agreements will have to follow applicable grant award terms and conditions.

42 U.S.C.

Section 5135(g)(2)(F) ☐ Yes ☐ No Intended Use Plan Template Section 4.2.1

Provide information about loan terms for communities that are categorized as low- income or underserved.

Minimum requirements for loan terms are outlined in 42 U.S.C. Section 5135(f)(1)(A).

Entities may change loan terms if they meet or exceed these standards. Loan agreements will have to follow applicable grant award terms and conditions.

42 U.S.C.

Section 5135(g)(2)(F) ☐ Yes ☐ No Intended Use Plan Template Section 4.2.2

Section 5135(g)(2)(E) ☐ Yes ☐ No Intended Use Plan Template Section 4.3

Section 5135(h)(2) ☐ Yes ☐ No Intended Use Plan Template Section 6.2

Introduction Status of the [Entity Name] Safeguarding Tomorrow Through Ongoing Risk Mitigation Revolving Loan Fund Provide information about the following items:

The intended use plan purpose; include the fiscal year it covers.

The agency that is responsible for emergency management and will oversee and manage the fund program.

The body in charge of financial management of the fund (if financial administration is combined as described in Section 4).

Any other entity, agency, or other party that will help manage the fund.

Updates for Fiscal Year [YEAR] Safeguarding Tomorrow Through Ongoing Risk Mitigation Revolving Loan Fund If this is the first intended use plan prepared by the entity, this section is not needed. Provide information to address the following prompts:

Summarize updates about the fund management that the entity has set up.

Detail capacity-building efforts.

Give updates about the use(s) of funds since the last capitalization grant.

Confirm if there have been any changes to the loan interest rates and explain why.

Describe any challenges that relate to staffing capacity and carrying out the program. Is the entity loan fund staffed and resourced enough? Does it have the knowledge needed to manage the operations and finances of the entity loan fund? If not, describe staffing/resource/knowledge gaps.

Describe how the entity loan fund has promoted equity in administering funds and carrying out the program. In the narrative, consider how the entity loan fund works to:

Increase outreach.

Increase capacity-building work.

Increase trainings.

Increase meetings.

In addition, include supporting data from projects/activities that can reinforce the narrative on equity benefits.

Uses of the [Entity Name] Safeguarding Tomorrow Through Ongoing Risk Mitigation Revolving Loan Fund (Safeguarding Tomorrow RLF) The sections that follow let entities describe how they plan to use the grant for approved activities for the Safeguarding Tomorrow RLF program. Entities should provide details in the specified sections that apply to how they plan to use funds in their loan fund.

[Entity Name] Program Objectives Describe the objectives of the entity loan fund.

How will the entity loan fund provide loans to the local governments that need financing assistance the most?

How will the entity loan fund support hazard mitigation projects and activities to reduce risks from natural hazards for homeowners, businesses, nonprofits, and communities by decreasing the loss of life and property, the cost of insurance, and federal disaster payments?

[Entity Name] Program Goals Connection to Other Plans and Goals Describe how the fund will be used in line with existing planning efforts, including the entity’s hazard mitigation plans. Describe how it will support other programs and efforts to reduce the impacts of major disasters as well.

Mitigation and Resiliency Goals Provide details about plans to achieve mitigation and resilience benefits per 42 U.S.C. Section 5135(g)(2)(B), such as:

Reducing future damage and loss associated with hazards.

Reducing the number of Severe Repetitive Loss and Repetitive Loss structures.

Decreasing the number of insurance claims due to injuries that result from major disasters or other natural hazards.

Increasing community ratings under the National Flood Insurance Program’s Community Rating System.

Short-Term Entity Safeguarding Tomorrow RLF Goals Include a list of short-term goals that will guide decisions for the loan fund. Entities may define short-term goals based on their or local communities’ needs. Short-term goals may include results that can be measured during the period of performance.

The following prompts may support the creation of short-term goals:

How will the entity loan fund help recipients complete projects?

How will the entity loan fund disburse loans to recipients in an efficient way?

How will the entity loan fund monitor and assess how the recipient carries out the project?

How will the entity work together with low-income geographic areas and underserved communities?

How will the entity identify and arrange projects that meet program goals quickly and efficiently?

Long-Term Entity Safeguarding Tomorrow RLF Goals Include a list of long-term goals that will guide the decisions for the entity loan fund. Entities may define long-term goals based on their or local communities’ needs. Long-term goals may include results that can be measured during the period of performance; the advancement of construction and phased actions; coordination with loan recipients, etc.

The following prompts may support creation of long-term goals:

How will the entity loan fund be managed to maintain a lasting source of funds?

What financial metrics will be used to make sure the fund is managed well and remains effective?

How will the entity loan fund continue to select projects effectively and clearly?

How will the entity work with local communities to make sure a steady flow of eligible projects is submitted and ready for funding?

How will the entity promote equity for low-income geographic areas and underserved communities throughout the life of the loan fund?

How will the entity use current and future assets and choose local projects in need of funding?

What methods will be in place to make sure capitalization grants and revolving income are used effectively?

How will the entity make sure it follows federal program requirements?

How will the entity help recipients follow federal requirements?

[Entity Name] Program Priorities Use information about the development of your project proposal list to complete the following sections.

Increase Resilience and Reduce Risk How will the entity loan fund support projects that build resilience and reduce the risk of harm to natural and built infrastructure? The following subsections offer potential actions to build resilience and reduce risk.

Provide information to address the following prompts, as applicable:

HAZARD MITIGATION

How will the entity award loans to support hazard mitigation planning?

How will the loan fund be used to support local hazard mitigation activities that reduce the impacts of natural hazards? State which hazards the entity plans to address. Eligible natural hazards may include:

Drought.

Extreme heat.

Severe storms. This includes hurricanes, tornadoes, windstorms, cyclones, and severe winter storms.

Wildfires.

Earthquakes.

Flooding. This includes the construction, repair, or replacement of a non-federal levee or other flood control structure.

Shoreline erosion.

High water levels.

Storm surges.

ZONING AND LAND USE PLANNING

If the loan fund will include projects for zoning and land use planning, provide information to address the following prompt:

How will the entity loan fund be used to carry out zoning and land use planning changes? The bullets that follow display approved zoning and land use activities.

Development and improvement of zoning and land use codes to encourage low-impact development; resilient wildland-urban interface land management and development; natural infrastructure; green stormwater management; conservation areas next to floodplains; implementation of watershed or greenway master plans; and reconnection of floodplains.

Study and creation of agricultural risk compensation districts where there is a desire to remove or set back levees that protect highly-developed agricultural land to mitigate for flooding. Such actions must allow agricultural producers to receive compensation for assuming greater flood risk that would lessen flood exposure to population centers and areas with critical infrastructure.

Study and creation of land use incentives that reward developers for using low-impact development stormwater best management practices. Such practices could swap density increases in some areas for increased open space in others; improve catch basins to reduce urban flooding; reward developers for including and augmenting natural infrastructure near building projects without reliance on increased sprawl; and reward developers for addressing wildfire ignition.

Study and creation of an erosion response plan that accommodates river, lake, forest, plains, and ocean shoreline retreating or bluff stabilization due to increased flooding and disaster impacts.

BUILDING CODE ADOPTION AND ENFORCEMENT

If the fund will be used to support building code adoption and enforcement, provide information to address the following prompt:

How will the entity loan fund be used to support building code adoption and enforcement?

COST SHARE

An entity loan fund may provide a loan to a local government for its non-federal cost share requirement of a grant under one of FEMA’s Hazard Mitigation Assistance (HMA) grant programs. Its use must follow all relevant program and legal requirements. An applicant should list any potential projects, where a loan may be used for this purpose, in the project proposal list submitted with its application. Federal funds that are used to meet the non-federal cost share requirement must meet the purpose and eligibility requirements of both the relevant Hazard Mitigation Assistance grant program and the Safeguarding Tomorrow RLF program. Local governments that want to use loan funding as matching funds for a Hazard Mitigation Assistance grant should work with the applying entity to find out their funding priorities; make sure the project is captured in the entity’s intended use plan and project proposal list; and position loan funding with project and grant timelines. There is no limit to the percentage of grant funds that loan recipients can use for this purpose.

If it applies, provide information to address the following prompts:

How will the entity loan fund be used to support loan recipients who will pay the cost share for federal and non-federal grants?

What other grant program(s) will the loans provide matching funds for?

Partnerships How will the entity loan fund include partnerships between eligible entities to carry out a project or similar projects?

This text can be similar to Question 17 in the grant application form. However, it gives entities room to fully describe their priorities in more detail and provide this information for public comment.

Regional Impacts How will the entity loan fund support projects that consider the regional impacts of hazards on river basins, river corridors, micro-watersheds, macro-watersheds, estuaries, lakes, bays, coastal regions, and wildland-urban interfaces? How will it do the same for areas at risk of earthquakes, tsunamis, droughts, severe storms, and wildfires?

This text can be similar to Question 18 in the grant application form. However, it gives entities room to fully describe their priorities in more detail and provide this information for public comment.

Major Economic Sectors and National Infrastructure How will the loan fund help projects that make key economic sectors and critical national infrastructure more resilient? This includes areas like ports, power and water facilities, and essential bridges and waterways for interstate commerce and global commodity supply chain assets within the entity’s jurisdiction. Refer to FEMA’s Community Lifelines Resources (https://www.fema.gov/emergency-managers/practitioners/lifelines) to inform the content.

This text can be similar to Question 15 in the grant application form. However, it gives entities room to fully describe their priorities in more detail and provide this information for public comment.

Criteria and Method for Distribution of Funds Loan Management Information Provide the following information:

Does the loan fund contain funds that are available to be disbursed as loans?

What is the loan application process for financial assistance from the loan fund?

How will the entity use financial planning to make sure funding is available in the future?

What are the short-, medium-, and long-term financial projections for the fund?

If available, provide a detailed loan application process and/or financial planning method and supporting materials in Appendix A; include a reference in your explanation in this section.

Criteria and Method for Loan Distribution Provide the following information:

What are the criteria and methods for disbursing funds to loan recipients? The following prompts may support defining criteria and methods:

How will the entity determine if loan applicants have the skills and resources they need to meet requirements?

How will the entity loan fund target funding for low-income geographic areas and underserved communities? How will interest rates vary?

How will the entity determine the types of assistance and interest rates for loan applicants based on their needs?

If applicable, provide a complete loan distribution procedure in Appendix B.

Creating a Project Proposal List Entities must provide a list of project proposals that include local government hazard mitigation projects per 42 U.S.C. Section 5135(b)(1)(A). These lists should be prioritized to show how the entity will use the capitalization grant funds.

Provide confirmation that the entity submitted a project proposal list with the grant application. FEMA offers a project proposal list template spreadsheet to help the entity draft this list.

PRIORITIZATION METHODOLOGY

Summarize the methodology the entity used to prioritize projects in the project proposal lists. FEMA recommends creating a ranking system to decide the priority of projects to be funded. Categories for ranking may include but are not limited to:

Duration of a project (multiyear versus annual).

Population served.

Projects that align with the statutory objectives.

Projects that align with the hazard mitigation plan.

Readiness to proceed.

Projects that promote equity objectives.

Provide a complete ranking system for prioritization in Appendix C.

TIEBREAKING PROCEDURE

Describe how the entity will determine which project to select if the projects have equal scores.

Financial Management Financial Status of the [Entity Name] Safeguarding Tomorrow Through Ongoing Risk Mitigation Revolving Loan Fund If the entity plans to combine the financial administration of the loan fund with that of another revolving loan fund established by the entity and not associated with the Safeguarding Tomorrow RLF program:

Name the agency that will handle the program’s finances and explain their role in managing the financial side of the program.

Describe how the entity will account for the capitalization grant, entity share, repayment of loans, and interest earned on amounts in the entity loan funds separate from other funds.

Describe how the emergency management agency will keep control over assistance priorities and oversight activities.

Name any other revolving loan fund(s) that will be combined with the entity’s loan fund under this program for financial management.

Explain how the entity loan fund will be used to pay the administrative costs for starting and operating the loan fund, as per 42 U.S.C. Section 5135(f)(6)(A).

State the percentage of funding for this fiscal year that is expected to be used for administrative costs.

Address the Financial Status of the Entity Loan Fund This information is required for the previous and current fiscal years, if available. For new applicants, this information is NOT required. FEMA suggests using the following prompts to make a table:

FOR THE PREVIOUS FISCAL YEAR

What are the sources of the funds in the entity loan fund? This includes the capitalization grant, entity match, bonds, loan repayments, interest repayments, and investment earnings.

How are the funds in the entity loan fund used? This covers administrative costs, transfers, capital projects, and bond debt services.

If it applies, describe any loan refinancing activities.

FOR THE CURRENT FISCAL YEAR

Where are the sources of the funds in the entity loan fund? This includes the capitalization grant, entity match, bonds, loan repayments, interest repayments, and investment earnings.

How are the funds in the entity loan fund used? This covers administrative costs, transfers, capital projects, and bond debt service.

If it applies, describe any loan refinancing activities.

Table 2: Example Sources Table

Table 3: Example Uses Table

Financial Terms of Loans Financial terms of loans have limits set by statute. The requirements are as follows:

Interest rates cannot exceed 1% but can be lower.

Annual principal and interest payments from the borrower must start no later than one year after the project is completed. The entity has the option to start payments earlier.

Standard loans must be repaid within 20 years of project completion. Loans to low-income geographic areas must be repaid within 30 years of project completion. This is the longest period allowed for repayment; entities can choose to have borrowers fully repay the loans earlier.

All loans should be repaid before the project’s design life ends.

Borrowers must name a specific revenue source to repay the loan.

Borrowers must have a FEMA-approved hazard mitigation plan.

All payments made by borrowers for both principal and interest must be deposited into the entity loan fund.

Entities should also describe if they plan to collect fees, how they will be collected, where they will be deposited, and their intended use.

Standard Loans Use the following prompts and the loan term limits in Section 4.2 to provide information on standard loan terms:

How will the fund set terms for standard loans?

What will interest rates be?

What is the expected repayment timeline?

How will the entity confirm that borrowers have or will establish a dedicated source of revenue?

Loans for Low-Income Geographic Areas or Underserved Communities Use the following prompts and the loan term limits in Section 4.2 to provide information about loan terms for communities that are categorized as low-income geographic areas or underserved communities:

How will the entity’s revolving loan fund set terms for loans to low-income geographic areas or underserved communities?

What will interest rates be?

What is the expected repayment timeline?

How will the entity check that borrowers have or will identify a dedicated revenue source for repayment?

Loan Disbursements Provide information on the following prompts:

What is the likely amount of funds the entity plans to disburse as loans during this fiscal year?

What is the utilization goal for the funds?

The utilization goal measures how well loan funds disburse loans. To find this number, cumulative assets are divided by the cumulative funds that are available for projects. Entities set a target measure that best aligns with their needs. FEMA suggests aiming for a pace level around or above 100%. If entities fall behind or experience a decline, they should review loan policies, procedures, and outreach. Most pace levels that exceed 100% suggest advanced loan commitment.

Has the entity worked with local governments to find possible revenue sources to support projects and activities that do not make money, per 42 U.S.C. Section 5135(f)(1)(A)(iii)?

Entity Program Management Technical Assistance If applicable, provide information to address the following prompts:

How will the entity loan fund be used to provide technical assistance to recipients, per 42 U.S.C. Section 5135(f)(6)(B)?

What percentage of the fiscal year’s funding will likely be used for technical assistance?

Local Capacity Development Describe how the loan fund is helping local communities build their capacity.

Environmental and Historic Preservation Compliance Describe how the entity plans to follow Environmental and Historic Preservation compliance procedures. This includes how proposed projects will be pre-screened and which activity types will be submitted to FEMA for review.

FEMA will give entities guidance and materials to help them complete this section.

Public Meetings and Comment Activities Provide information on the following items:

How did the entity include public input, consultations with government agencies, and feedback from interested groups before submitting this intended use plan?

How has the entity used information from public meetings and comment activities to help carry out the loan fund?

Describe the public notice process and actions taken to address public comments for project proposals.

Audits and Reporting Compliance with Federal Reporting Requirements Complete the template language below:

To ensure clarity, all program materials are posted on our website [Entity Website]. We will use the services of a(n) [enter preferred auditing agency (e.g., outside Certified Public Accounting firm)] to run an independent audit to make sure finances are correct for the one- and two-year audits.

We commit to entering project and benefits data into the FEMA Grants Outcomes (FEMA GO) system. We will enter financial data in the Payment and Reporting System as well. These efforts will support the evaluation of the [Entity Name] Safeguarding Tomorrow RLF program. Among other requirements, FEMA will use the data from the audits and reporting to assess how the loan funds:

Administer the funds.

Provide project benefits to local communities.

Promote equity.

We will enter project benefits data into FEMA GO by the end of the quarter in which the capitalization grant is received. After the period of performance, we will enter required project benefits data into FEMA GO by the end of the fiscal year for this intended use plan.

Benefits data includes the hazard mitigation benefits narrative. The hazard mitigation benefits narrative shows how a project lowers a community’s risk from natural hazards. It also shows how the community builds resilience. The variety of project types funded by the program can make measuring this challenging. The entity should figure out ways to track the mitigation benefits of selected projects.

The benefits narrative is a flexible way to report on the status and success of funded projects. It should clearly state the pre-mitigation conditions and the post-mitigation conditions created by the project. The difference between these will show the mitigation benefit of the project. Pre- and post-mitigation conditions should be supported by data where possible. Data could include details on hazard recurrence; population, structures, and infrastructure affected; loss of function of services; and other benefits.

In addition to the template text above, provide information for the following prompt:

What information will be collected to support the analysis of pre- and post-mitigation conditions? How will the entity measure project benefits?

Publication of Information Describe the frequency and location of the publication of information requirement. Per 42 U.S.C. Section 5135(h)(2), the entity should publish and periodically update all projects that receive funding from the loan fund. This includes project location, type and amount of assistance provided from the loan fund; the expected funding schedule; and the expected date of project completion.

The recipient should publish information publicly on a preferred platform and at the times most suitable to the recipient during and after the period of performance.

Loan Recipient Auditing and Reporting Describe how the entity loan fund will monitor and evaluate the performance of loan recipients to make sure they follow fund usage guidelines, if it applies.

Additional Resources This section is for informational purposes. Remove this section before you submit your plan.

https://www.climate.gov/ National Oceanic and Atmospheric Administration’s Sea Level Rise Viewer: https://coast.noaa.gov/slr/ U.S. Climate Resilience Toolkit: https://toolkit.climate.gov/#climate-explorer National Risk Index for Natural Hazards (for information on place-based vulnerabilities and current and historical natural hazard exposure): https://www.fema.gov/flood-maps/products- tools/national-risk-index https://www.drought.gov/ https://heat.gov/ https://wildfirerisk.org/ National Climate Assessment: https://nca2018.globalchange.gov/ Climate Mapping for Resilience and Adaptation: https://resilience.climate.gov/

Appendix A

Appendix B B.1. Loan Distribution Methodology

Appendix C C.1. Project Proposal List Prioritization Methodology image1.jpeg image2.png