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

Over at Emergency Management Magazine, there was an interesting article about how FEMA is floating the idea of that would "give states a financial incentive to better prepare for storms, floods, hurricanes and other disasters." 
Their article comes on the heels of January on "Proposed Rules" under the title of

Federal Emergency Management Agency

Establishing a Deductible for FEMA’s

Public Assistance Program

AGENCY:

Federal Emergency

Management Agency, DHS.

SUMMARY:

“The Federal Emergency Management Agency (FEMA) is considering the establishment of a disaster deductible, requiring a predetermined level of financial or other commitment from a Recipient (Grantee), generally the State, Tribal, or Territorial government, before FEMA will provide assistance under the Public Assistance Program when authorized by a Presidential major disaster declaration. FEMA believes the deductible model would incentivize Recipients to make meaningful improvements in disaster planning, fiscal capacity for disaster response and recovery, and risk mitigation, while contributing to more effective stewardship of taxpayer dollars. For example, Recipients could potentially receive credit toward their deductible requirement through proactive pre-event actions such as adopting enhanced building codes, establishing and maintaining a disaster relief fund or self-insurance plan, or adoption of other measures that reduce the Recipient’s risk from disaster events. The deductible model would increase stakeholder investment and participation in disaster recovery and building for future risk, thereby strengthening our nation’s resilience to disaster events and reducing the cost of disasters long term. FEMA seeks comment on all aspects of the deductible concept.”

In regards to the deductible:

“Consistent with the principles of the Stafford Act that assistance from the Federal Government is supplemental in nature and that every recipient of disaster assistance has some measureable capacity to independently respond, FEMA is considering the establishment of a disaster ‘‘deductible.’’ To ensure a Recipient’s participation in recovery from disaster losses, following receipt of a major disaster declaration authorizing the Public Assistance Program, the Recipient(s) would be required to demonstrate it has satisfied a predetermined deductible amount before FEMA would provide assistance through a Project Worksheet for eligible Public Assistance work. FEMA would intend for the calculation of the deductible level for each Recipient to be published periodically and to be representative of Recipient capability. In addition to considering how to calculate a deductible amount, FEMA is considering what means by which a Recipient could demonstrate it has satisfied a deductible requirement, including through completion of FEMA- eligible projects entirely with its own funding, or through other Recipient activities for which FEMA would calculate an appropriate credit against the deductible. FEMA might provide a credit toward the deductible, for example, for a Recipient’s prior adoption of a building code that reduces risk; for adoption of proactive fiscal planning such as establishing a disaster relief fund or a self-insurance fund; or investment in programs of assistance available when there is not a federal declaration.”

What you are hearing is the cry of a thousand local emergency management directors, upset that the potential gravy train of FEMA money may soon dry up.  As the writers at the Heritage Foundation pointed out:

“The pace of FEMA declarations has increased with each new President. In just eight years, President George W. Bush issued nearly as many FEMA declarations as Presidents Reagan, George H. W. Bush, and Clinton combined. In 2011 alone, President Obama issued more FEMA declarations than President Reagan did in eight years and President George H. W. Bush in four years. Is it any surprise that the Disaster Relief Fund keeps running out of funds, thereby requiring emergency appropriations?”

If a federal agency wants to shift some responsibilities the states, I am all for it. I argue that localities are better equipped to handle emergency situations than a centrally planned response. FEMA was created to respond to a Superstorm Sandy or Hurricane Katrina level event. As cold hearted as this will sound, this agency has been overtaxed by being called into smaller disasters. This can lead up to a point that if a major disaster occurred, FEMA would be ill prepared or funded to respond, leading to a Katrina like response.

Much like other post on this page, the point is very clear, you cannot depend on either the general government or even your local government to respond effectively to disasters. The best way to ensure that you are not severely impacted when disasters strikes, is to take responsibility for you and your family and being prepared.

Good Luck and Good Hunting