Streamline FEMA’s activities and reduce its costs

On the very day the Obama administration left office, the Federal Register published the Federal Emergency Management Agency’s (FEMA) “parting gift”: a system of “deductibles” for national emergencies, from floods to hurricanes and earthquakes.

FEMA’s scheme would permit the agency to begin assistance only after the affected state absorbs, say, $1 million or $5 million of damages. This self-insured deductible could be offset, suggested Obama’s FEMA administrator, Craig Fugate, by disaster mitigation efforts or by other means.  

{mosads}Setting aside the unusual timing of FEMA waiting until its exit to advance this cost-saving rule, there are better ways for the states to absorb a greater share of the cost for disasters that occur within their borders. 

Here are some suggestions to streamline FEMA’s activities and reduce its costs:

Substantially raise FEMA’s damage threshold

FEMA’s mission is to assist states when the financial severity of an incident exceeds the state’s capacity to act but the current threshold for disaster funding is set very low. 

Today, FEMA pays 75 percent of all infrastructure damages — from the first dollar — when estimated costs exceed $1.41 per capita. For smaller, less populous states, damages of about $1 million are enough to trigger FEMA funding.

Louisiana, which has averaged at least one federal disaster a year during the past decade, is eligible for federal assistance once damage costs exceed about $7 million.  

It is a stretch to consider such minimal damage as catastrophic, and the over-dependence on FEMA provides little incentive for a state to spend its own taxpayer funding on disaster mitigation — things like improved construction standards, for instance, that will reduce the impact of disasters when they occur.

Instead of imposing a system of disaster deductibles, let’s explore making the states more accountable in the first place, by increasing the threshold for disaster relief.        

Stick to national-level disasters

Rather than providing true disaster relief, many federally declared disasters are little more than money transfer events that incur federal costs for what are essentially local problems. 

Today, FEMA funds all sorts of disasters whose costs should rightly be borne by state and local taxpayers — even the cost for snow removal “that overwhelms the capability of the affected state.”  While the goal may be a noble one, FEMA usually won’t even have staff on the ground until well after the streets are cleared. In such cases, FEMA’s only role is to carry out an administratively costly process to reimburse states for the cost of plowing.

It is hard to argue that snow removal is a legitimate use of federal money, and doing so only impedes the ability of the agency to respond to truly national-impact events.

Use block grants

FEMA’s ground presence is expensive, even for limited events. 

In 2016, for instance, Texas had four declared disasters. For each of them, FEMA deployed hundreds of staff to the Lone Star State. Each time, the agency proceeded through the same laborious process with the state and the affected counties and municipalities: mandatory, redundant meetings with each entity, site visits to (and detailed documentation of), every impacted area, and the entry (by hand) of lengthy administrative reports for each discrete project. 

At this point, emergency officials in Texas probably know as much about FEMA’s program requirements as FEMA officials do, and require very little true oversight. 

Other than the favorable optics of having federal presence on the ground, there is absolutely no reason to incur these costs for most declarations. Instead, let the states submit certified estimates for work completed (or receipts for work done), subject to full audit and penalties if the work is misstated or disallowed. It will dramatically speed up the process and save millions — and free up FEMA staff to support higher priority disasters.

Christopher E. Hagerup is a senior policy adviser to the National Sheriffs Association and former FEMA director of Intergovernmental Affairs. 

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