FEMA’s New ‘Disaster Deductible’ Shifts Responsibility to States

Disasters assistance administrators are already overburdened, says the National Governors Association.

by Vera Bergengruen / May 31, 2016
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(TNS) - Under pressure from Congress to reduce federal dollars spent on emergency aid, the Federal Emergency Management Agency is floating a new proposal that would give states a financial incentive to better prepare for storms, floods, hurricanes and other disasters.

Some state and local officials are pushing back. Many of the 150 public comments filed to the agency express concern that the proposed changes would just shift the financial and administrative burden to local governments already overloaded during disaster situations.

“Disaster assistance administrators at the state and local level are already overburdened, particularly in the aftermath of a major disaster,” the bipartisan National Governors Association said in its comments, calling the current system an already “complex and time-consuming exercise.”

The change would reward states that take actions to prevent disasters, while making those that do not pay a greater percentage before the federal government pitches in. They would be responsible for an initial share of disaster costs through a deductible that they could lower by taking steps to become better prepared — for example by adopting tougher building codes, establishing their own emergency management funds, and investing money in elevating homes and moving communities out of riskier regions.

The agency believes that this would be a better option than simply increasing the threshold to receive disaster aid.

“We don’t want to have to use the blunt instrument of just tripling the indicator. It would save a lot of money for the federal government but wouldn’t build the common goals of building readiness for communities,” said Josh Batkin, FEMA’s director of external affairs, in an interview.

The number of disaster declarations by the president has increased from an average of 13 per year in the 1950s, to an average of 137 per year in the 2000s. Under the current system, the president makes a major disaster declaration to assist state and local governments when the scale of the disaster exceeds their capabilities.

While recognizing the need to change the system, many respondents expressed concerns that such a deductible would create an administrative headache that puts an extra burden on local governments during disasters.

“We feel that having a disaster deductible will create more confusion and generate more documentation requirements,” wrote Susan Gilson, director of the National Association of Flood and Stormwater Management Agencies, in her public comment to FEMA. “The disaster deductible will cause local communities to divert resources to meeting the documentation requirements at a time when the local community needs to be focusing its efforts on disaster recovery.”

Smaller communities could simply not have the resources to get through the bureaucracy, according to many local officials.

“The question for us is manpower,” South Carolina Emergency Management Division chief of recovery and mitigation Elizabeth Ryan said in an interview.

“We’re here to advocate for the applicant, but having to provide justification proving how much or how little was planned would add a lot more work, and we just don’t have the manpower to tackle this thing when we’re still engaged in response and recovery.”

Other organizations think that putting more emphasis — and pressure — on local governments is a necessary step.

“Too many states have come to believe natural disasters are the problem of the federal government, when actually, public safety is the primary responsibility of state and local governments that have authority to guide development to be at more or less at risk to natural hazards,” the Association of State Floodplain Managers said in its comments to FEMA, calling the proposal a good first step.

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Simply reducing the number of emergency declarations made by the president would have an impact.

“Transferring aid from federal to local government is not costless,” Carolyn Kousky, a fellow at the environmental research nonprofit Resources for the Future, said in an interview. “There are a lot of declarations for very small amounts of money, and for some it costs more to get the dollars to local government than the money they’re sending.”

Her organization put out a study that found the deductible would reduce federal aid by a small percentage but would eliminate a large number of the emergency declarations, thereby saving on administrative costs.

However, there is a chance that even a minor decrease in aid would be felt most by small and rural communities.

“Victims of Hurricane Sandy in New York and New Jersey would still get a large amount of money,” Kousky said. “It’s very plausible that some rural communities with less resources would feel the loss of that small amount of money more since it’s a bigger deal.”

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That is the main concern of state and local officials who struggle to stretch already scarce resources during storms, floods and other disasters.

“For these communities it may affect their ability to recover from an event because they flat out don’t have the money,” South Carolina Emergency Management director Kim Stenson said, pointing out that there already is a 25-percent cost share for the communities.

“Even with that cost share, sometimes that’s very onerous, especially for some small counties in South Carolina,” he said.

The White House said earlier this month that FEMA will use the feedback it has received on its proposal and put together an updated plan for state deductibles. The agency has emphasized that the current proposal is being shaped by the input they’ve received.

“We’re still going through 150 comments in an effort to lay out how this would work, and we’re going to get even more detailed comment back,” Batkin said.

“We don’t have all the answers; we need the community to help us figure it out,” he said. The agency plans to publish the rule later this calendar year.

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