Abstract: All disasters are local. Or so many
politicians proclaim. Yet 29 states send their tax money to FEMA
only to end up footing the disaster-response bill for the other 21.
Unfair? Incredibly so -- and inefficient -- explains Heritage
homeland security expert Matt Mayer. Instead of nationalizing
disaster management, states should keep their FEMA taxes -- and
fund and manage their own local disasters. Mayer explains how to
amend the Stafford Act to make this happen.
In 1996, the Federal Emergency Management Agency (FEMA) issued
more disaster declarations (157) than in any year before or
since. As President Clinton's FEMA administrator,
James Lee Witt, remarked, "Disasters are very political events."
As Chart 1 shows, beginning in 1993, the federal government
played an ever-increasing role in natural disasters across America.
In the short span of 16 years, the yearly average of FEMA
declarations tripled from 43 under President George H. W. Bush, to
89 under President Clinton, to 130 under President George W. Bush.
With President Barack Obama's current pace of 139 declarations this
year -- the fifth-highest in FEMA history -- despite the absence of
any hurricanes or other major disasters, it appears the march
toward a de facto national emergency management agency is
inevitable. (NEMA -- the existing National Emergency
Management Association will have to change its name.)
This nationalized disaster response agency would be a colossal
mistake given that (1) most response resources are locally owned,
(2) response from Washington, D.C., is always slow, and (3) other
than hurricanes, disasters do not provide notice of their arrival
until they have arrived, so any federal response will be well after
the fact. An even more significant reason a nationalized disaster
response agency would be a stupendous mistake is that, even today,
a majority of states do not benefit from FEMA's largesse. Rather, a
minority of states receive the majority of declarations -- which
means a majority of states send their disaster-response taxes to
Washington, D.C., so that FEMA can subsidize the disaster responses
in a minority of states.
The worse part about this tax-redistribution policy is that the
politicians from the subsidizing states support this policy despite
how unfairly it affects their own states.
Federal Disaster Policy Creates
Incentives to Nationalize Disasters
The controlling federal statute for disasters is the Robert T.
Stafford Disaster Relief and Emergency Assistance Act of 1988
(Stafford Act). Under the Stafford Act, the federal
government pays at least 75 percent of the disaster response so
long as FEMA has issued a declaration. The key provisions of the
Stafford Act, which create enormous incentives for governors to
seek disaster declarations from FEMA, are:
- Section 402(5): the federal government pays 100 percent of the
costs to save lives, prevent human suffering, or mitigate severe
- Section 403(b): the federal government pays not less than 75
percent of eligible assistance essential to meeting immediate
threats to life and property;
- Section 404(a): the federal government pays not less than 75
percent of hazard mitigation efforts;
- Section 406(b): the federal government pays not less than 75
percent of eligible costs to damaged facilities;
- Section 407(d): the federal government pays not less than 75
percent of eligible debris removal costs; and
- Section 408(g): the federal government pays 100 percent of
individual assistance (up to $25,000 per household).
Without a FEMA declaration, these costs are borne entirely by
the state and local governments affected by the disaster. With a
FEMA declaration, at least 75 percent of the above costs are
shifted to the other 49 states not affected by the
Given these incentives, it should not be a surprise to anyone
that governors quickly -- within five years of its enactment --
figured out how to manipulate the Stafford Act and FEMA and turn
local disasters into national occasions, and why Presidents, given
their electoral interests, have been eager participants in this
redistribution game. By shifting their costs to other states, these
governors are adopting a "spread the wealth" mentality. The problem
with this approach, however, is that it fails to take a step back
from the trough long enough to figure out that the gains for many
of the states are illusory.
FEMA's Winners and Losers
The exact percentage of annual federal taxes that represent
funds for "disaster response" -- taxes used by the federal
government to execute the Stafford Act -- is unknown. What is known
is that a majority of states would be better off if they just kept
their disaster response taxes and funded their own emergency
management operations. Specifically, because a majority of states
receive a smaller share of FEMA declarations in proportion to their
populations, these states subsidize the minority of states that
receive a greater number of FEMA declarations in proportion to
their populations. (See Table 1.)
Take Oklahoma, which since 1993 has received 90 FEMA
declarations -- an average of 5.45 declarations per year. These 90
FEMA declarations equate to 5 percent of all FEMA declarations
across the country in that period of time. In contrast, Oklahoma's
population of 3,642,361 represents only 1 percent of the total U.S.
population. Roughly 40,471 Oklahomans footed the bill for each
disaster declaration for their state.
At the same time, Michigan, which has 3 percent of the U.S.
population, received only 1 percent of FEMA declarations in 1993.
Specifically, Michigan has a population of 10,003,422 and received
only 14 FEMA declarations, which averages to 0.85 declarations per
year. On average, roughly 714,530 Michiganders paid disaster
response taxes to support each of those FEMA declarations, or,
stated another way, 674,059 more taxpayers in Michigan sent
money to Washington, D.C., for each FEMA declaration in Michigan as
compared to taxpayers in Oklahoma. That means that more Michigan
citizens will pay higher taxes, and other states will receive more
money from FEMA. Much of the money that Michiganders pay in taxes
subsidizes small disasters in other states that should not have
received FEMA disaster declarations in the first place.
Based on this analysis, Michigan is paying far more into
the disaster response tax bucket than it gets out of it each year
as people in Oklahoma pay far less into the bucket than they
get out of it. Although an admittedly simple comparison, Oklahoma
is clearly winning (defined as getting the federal government to
redistribute its costs to other states) and Michigan is clearly
losing (defined as disproportionately paying the costs of other
Using this percentage of all FEMA declarations compared to the
percentage of total U.S. population as the metric, as Map 1 shows,
under the current policy, there are more states that lose (have the
same or lower percentage of FEMA declarations as a percentage of
total U.S. population) than win (have a higher percentage of FEMA
declarations as a percentage of total U.S. population).
Some argue that the current policy makes sense because there are
more winners than losers (assuming those who break even should not
care). This argument, however, ignores the reality that states that
lose or break even are better off if they keep their disaster
response funds because they will then have full control over their
disaster responses, which is arguably better than being controlled
by Washington, D.C.
This argument also does not stand up to the fact that the
minority 21 states and District of Columbia "winners" have received
942 FEMA declarations since 1993, which represent 53 percent of all
FEMA declarations during that time. Of those states, only
Louisiana, Texas, and the District of Columbia have experienced
disasters that can be classified as catastrophes with nation-wide
effects (Hurricanes Katrina and Ike and the September 11 attack).
The other 19 states have experienced routine disasters, such as
tornadoes, floods, fires, and storms that they can manage without
federal involvement. Natural disasters rarely, if ever, involved
the federal government from 1787 to 1993.
But, the "more winners than losers" argument ignores an even
more basic calculation: demographics. Because many of the "winning"
states are sparsely populated, their allocation of U.S. House and
Senate members is also small. Using the Electoral College numbers
for each state, the losing states hold 303 votes (271
representatives and 32 senators) and the winning states hold only
144 votes (104 representatives and 40 senators). This allocation
means that the losing states have more than enough votes (218) in
the U.S. House to amend the Stafford Act to make it more equitable
for their own taxpayers.
The U.S. Senate is where the tougher challenge to change the
Stafford Act lies. Of the break-even states, Arkansas (25
declarations since 1993), Connecticut (10), Idaho (11), Iowa (19),
Mississippi (23), Nebraska (25), South Carolina (15), Utah (15),
and West Virginia (26) have averaged fewer than two FEMA
declarations per year since 1993. These states hold the 18 votes
needed to amend the Stafford Act. If the remaining five states
determine that retaining 100 percent control over their disaster
response is in their best interest, a filibuster-proof majority of
60 votes is within reach.
Despite the fact that a clear majority of states and their
congressional members do not come out ahead under the current
system, advancing a real FEMA reform agenda has fallen on deaf
ears. Perhaps with the data in this paper, more Members of Congress
will be interested in putting in place the reforms necessary to
ensure that states and localities regain their primary role in
disaster response and, as important, stop subsidizing the routine
localized disasters across America.
Nationalization of Disasters Leaves
Often overlooked in the discussion on the role of FEMA is the
impact that nationalization has on the overall preparedness of both
the states and FEMA. In addition to the incentive noted above for
governors to nationalize disasters so they can spread the costs of
their disaster management to other states, the nationalization of
disasters also undermines the preparedness of state and local
emergency management agencies.
As discussed more fully in my book Homeland Security and
Federalism: Protecting America from Outside the Beltway:
[w]hen FEMA federalizes routine natural disasters, states and
localities lose the incentive to prepare for those events. As a
result, FEMA will inherit the load. At the same time as changes
were happening in Washington that caused substantial complaints
from the emergency management community, states, responding to the
federalization of disasters, were cutting emergency management
budgets by an average of almost 25 percent.
These cuts leave states with too few disaster response
capabilities, which only create more incentives to nationalize
routine disasters. This ratchet-down effect places all but the
smallest disasters outside the reach of the Stafford Act.
The nationalization of routine disasters requires FEMA to get
involved with a new disaster somewhere in the United States every
2.8 days. This operational tempo keeps FEMA perpetually in a
response mode, leaving too little time and resources to adequately
focus on catastrophic preparedness. With staffing levels and
budgets only nominally larger than the pre-1993 levels, it should
be no surprise that FEMA is not able to handle a catastrophic
In fact, an audit in 2008 found that "FEMA continues to perform
well responding to non-catastrophic or 'garden variety' disasters;
however, it still has much to do to become a cohesive, efficient,
and effective organization to prepare for and respond to the next
catastrophic event." "In the nine critical areas reviewed in the
audit, in the almost three years since Hurricane Katrina, FEMA had
'made moderate progress in five of the nine areas, modest progress
in three areas, and limited progress in one area.'" The bottom line is
that this heightened pace is putting an undue burden on FEMA staff
The surprise should not have been the failures that occurred
while responding to Hurricane Katrina; rather, the surprise should
have been that FEMA was able to paper over enormous capabilities
deficiencies from Hurricane Andrew in 1992 to Hurricane Floyd in
1999 to Hurricane Katrina in 2005.
A Fairer -- and Better -- Way to
It is clear that the current definition used by FEMA to issue
declarations is routinely ignored. After all, no reasonable person
would concede that the vast majority of the 2,864 FEMA declarations
involved disasters that were "of such severity and magnitude that
effective response [wa]s beyond the capabilities of the State and
the affected local governments and that Federal assistance [wa]s
necessary." In some cases, the FEMA declarations were
issued months after the disaster struck, further
highlighting the reality that FEMA declarations are mostly about
In 2008, Ohio experienced a strong snowstorm from March 7 to
March 9. It was not until April 24, however, that Ohio received a
FEMA declaration. By that time, the snow had long since melted and
the emergency was over. As further proof of the inanity of the
whole process, in the FEMA press release almost seven weeks later,
FEMA Administrator David Paulison proclaimed "that federal funding
is available on a cost sharing basis to save lives and protect
public health, safety and property over a continuous 48-hour period
during the incident period. Snow removal and emergency
protective measures will be provided at 75 percent Federal
funding" (emphasis added) as if the FEMA declaration had been
issued on March 7. Issuing a declaration was not about
saving lives or protecting property. It was all about the money.
The bottom line is that it is fundamentally unfair for taxpayers
in the rest of the United States to subsidize the routine disasters
that occur in a smaller group of other states. In order to reverse
this nationalization of disasters, Congress should amend the
Stafford Act and:
- Establish clear requirements that limit the types of situations
in which FEMA declarations can be issued. One way to accomplish
this is to align declarations with the various international scales
used for disasters (for example, the Saffir- Simpson Scale, the
Richter Scale, or the Fujita Scale). Limiting disaster declarations
to Category 1 hurricanes and above, for instance, would eliminate
declarations for all tropical storms that cause moderate damage,
but are not "of such severity and magnitude that effective response
is beyond the capabilities of the State and the affected local
governments and that Federal assistance is necessary."
- Eliminate certain types of disasters from FEMA's portfolio
entirely. For example, burdening FEMA with allocating money to
farmers for crops destroyed by freezing temperatures is highly
inefficient. Insurance markets and state and local governments can
deal with such disasters more efficiently than the federal
government can. Finally, while severe storms and tornadoes cause
property damage and cost lives, they rarely outstrip the abilities
of state and local governments.
- Reduce the cost-share provision for all FEMA declarations to no
more than 25 percent of the costs. This change will ensure that at
least three-fourths of the costs of a disaster are borne by the
taxpayers living where the disaster took place. The current policy
is simply unfair to those Americans living in states that do not
experience many disasters. For catastrophes with nationwide impact
disasters, such as 9/11 and Hurricane Katrina, a relief provision
could provide a higher federal cost-share where the total costs of
the disaster exceed a certain threshold amount.
Over the last 16 years, politicians on both sides of the aisle
and from across the country viewed the increasing federalization of
FEMA declarations as another way to get federal funds into their
states. As the data demonstrate, however, the current FEMA
disaster-declaration process produces fewer winners and more
losers, resulting in the large-scale subsidization of 21 states by
the taxpayers in the other 29 states. It is time for policymakers
to stop clamoring for money and to start living by the motto they
all proclaim: "All disasters are local."
Almost all disasters are indeed local, which is why the vast
majority of them should be responded to, run by, and funded by
state and local governments and their taxpayers. Save FEMA and
federal funds for the exceptional catastrophes that do require the
federal government to step in.
Matt Mayer is a Visiting Fellow at The Heritage
Foundation and president of the Buckeye Institute for Public Policy
Solutions in Columbus, Ohio. He has served as Counselor to the
Deputy Secretary and Acting Executive Director for the Office of
Grants and Training in the U.S. Department of Homeland Security. He
is author of Homeland Security and Federalism: Protecting America
from Outside the Beltway.
A. Mayer, Homeland Security and Federalism: Protecting America
from Outside the Beltway (Santa Barbara, Cal.: Praeger, 2009),
Ibid., p. 99, citing Christopher Cooper
and Robert Block, Disaster: Hurricane Katrina and the Failure of
Homeland Security (New York: Times Books, 2006), p. 64.
Robert T. Stafford Disaster Relief and
Emergency Assistance Act, Public Law No. 100-707, November 23,
Senate Committee on Homeland Security and Government Affairs,
"FEMA's Level of Preparedness," 110th Congress, 2nd sess., 2008,
Mayer, Homeland Security and Federalism,
p. 101. The nine critical areas are: overall planning, coordination
and support, interoperable communication, logistics, evacuations,
housing, disaster workforce, mission assignments, and acquisition
42 U.S. Code § 5191(a).
42 U.S. Code § 5191(a).