Once again, the budget brinksmanship in Washington, D.C., ended with a deal that postponed one of the key questions driving the debate: Should the Federal Emergency Management Agency (FEMA) receive whatever funding it desires, or should the federal government rein in FEMA and its profligate spending by exercising fiscal restraint? FEMA’s current spending and declaration trends represent a microcosm of the larger problems facing America.
Specifically, FEMA is running out of money in its Disaster Relief Fund (DRF) due to its daily disaster spending burn rate, which is approaching $13 billion per year. FEMA’s fiscal crisis piles onto the federal government’s larger fiscal debt crisis, driven by a massive expansion of the federal government over the past four years.
Federalization of Disasters Driving Funding Crisis
FEMA’s funding crisis is directly related to the federalization of natural disasters that has occurred since 1993. The Heritage Foundation has been the lone voice urging reform of this system, as it is undermining capabilities at FEMA and in state and local governments. The declaration activity in 2011 illustrates this problem.
For the first nine months of 2011, FEMA has issued 222 declarations, which is a single-year record and a 41 percent increase over the previous record of 157 declarations set in 1996, when President Bill Clinton was running for reelection. FEMA has issued 84 Major Disaster Declarations this year, which also is a record.
This pace of declarations is draining the DRF at a pace of $30 million to $40 million per day.
For perspective on FEMA’s “new normal,” Hurricane Irene—barely a Category 1 hurricane when it finally struck the U.S.—resulted in Major Disaster Declarations for 12 states, largely for flooding. In sharp contrast, just six years ago, Hurricane Katrina—America’s costliest disaster by tens of billions of dollars, with more than 60,000 square miles impacted—resulted in just four states receiving Major Disaster Declarations. Texas did not even receive a Major Disaster Declaration for Hurricane Katrina.
“Reforms” Should Not Drive Costs Even Higher
Because of this significant increase in activity, FEMA’s costs are exploding, and it is draining the DRF. Keep in mind that a Major Disaster Declaration is the highest FEMA declaration, which triggers a 75 percent (or more) cost shift from the state to the federal government. Louisiana Senator Mary Landrieu (D) recently introduced a bill called the Disaster Recovery Act of 2011 (S. 1630) that would make matters even worse.
Here are some key sections:
The fiscal impact of S. 1630 would appear to be quite large, which would only exacerbate FEMA’s funding problems.
Real FEMA Reform
Instead of federalizing disasters to a greater extent, the federal government needs to exercise fiscal restraint and force states to be responsible for their own localized problems. The solution should not perpetuate the funding problem by avoiding it through a short-term gust of money or worsen it by driving the cost even higher. Specifically, Congress should:
Enough with the Band-Aids
Congress can continue to simply give FEMA another round of taxpayer dollars as a short-term bandage for its budget woes. However, this only ensures that the fundamental problems with FEMA’s disaster response framework remain unfixed for another year—leaving state and local governments less prepared and FEMA undoubtedly ill-equipped for the next truly catastrophic disaster.
Matt A. 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 and is author of Homeland Security and Federalism: Protecting America from Outside the Beltway.
“FEMA Declarations, by Year and by Presidential Administration,” Heritage Foundation chart, August 31, 2011, at http://www.heritage.org/Multimedia/InfoGraphic/2011/08/FEMA-Declarations.
“FEMA Reform and Disaster Response: Heritage Foundation Recommendations,” Heritage Foundation WebMemo No. 3359, September 8, 2011, at http://www.heritage.org/Research/Reports/2011/09/FEMA-Reform-and-Disaster-Response-Heritage-Foundation-Recommendations.
Matt Mayer, James Jay Carafano, and Jessica Zuckerman, “Homeland Security 4.0: Overcoming Centralization, Complacency, and Politics,” Heritage Foundation Special Report No. 97, August 23, 2011, at http://www.heritage.org/Research/Reports/2011/08/Homeland-Security-4-0-Overcoming-Centralization-Complacency-and-Politics.
Lee Clarke, Mission Improbable: Using Fantasy Documents to Tame Disaster (Chicago: University Of Chicago Press, 1999).