Disaster Zone

Hurricane Sandy: 100%--90%--75% Reimbursement?

What level of financial reimbursement will the feds use for states hit hard by Sandy?

by Eric Holdeman / December 11, 2012

Following a disaster which reaches the level of a Presidential Declaration the expected Federal funding for public assistance to state and local jurisdictions is typically 75% of "eligible" damages.  Note the key word "eligible" damages--which are assessed by joint teams of local, state and federal staffs who visit every disaster site to estimate the damages.  Many times states split that cost with local jurisdictions so that each pays 12.5%.


One estimate being thrown around is that Superstorm Sandy will be a $80B disaster.  The difference between 100% and 75% reimbursement is significant--$25B, which is not chump change.


Early on Governor Cuomo started his own campaign to get a higher level of reimbursement than the standard 75%.  See quote, "Governor Andrew M. Cuomo today formally requested the maximum authorized federal reimbursement for federal aid in New York State's response to and recovery from Hurricane Sandy for all federally declared counties. The Governor will ask the New York congressional delegation to pass legislation that will allow the federal government to reimburse 100% of costs, and not 90% which the law currently allows the President to authorize."  Note:  This was for early costs associated with the response.


Secretary Napolitano also got into the act:

Secretary Napolitano announces increased eligibility for Hurricane Sandy debris removal.. 

"The Fiscal Year 2007 Department of Homeland Security Appropriations Act authorized a Public Assistance Pilot Program intended to reduce the costs to the Federal government of providing assistance to States and local governments; increase  flexibility in the administration of assistance; and expedite the provision of assistance under the Robert T. Stafford Disaster Relief and Emergency Assistance Act. Due to the current pressing need for efficient and timely recovery from a catastrophic disaster event, Hurricane Sandy, which has cast widespread debris over a major portion of the eastern seaboard of the United States, this rule implements one of the debris-related Public Assistance Pilot procedures: it allows for the reimbursement of the straight- or regular time salaries and benefits of the employees of Public Assistance applicants who perform disaster-related debris and wreckage removal work for any major disaster or emergency declared by the President on or after October 27, 2012, in response to Hurricane Sandy."


Normally only personnel overtime costs are eligible.


Talking earlier this evening with a responder who is out there on the East Coast working the Sandy disaster there is a push for the maximum amount of Federal assistance to be provided as allowed for by public law.  


The challenge is what will the FEMA Inspector General de-obligate five years from now when they come behind the disaster parade looking at all the paperwork and not agreeing with the decisions made in the field?


A billion here, a billion there--pretty soon it adds up quickly.