FEMA disaster relief fund faces August shortfall as feds scramble to find cash

WASHINGTON — The Federal Emergency Management Agency’s disaster relief fund is on track to run out of money as soon as next month, though the agency’s administrator told Congress on Thursday that she’s working with the White House to find a solution.

“Our current projections on the disaster relief fund is that we will go into a deficit at some time mid-to-late August,” FEMA Administrator Deanne Criswell said before a U.S. House panel.

FEMA, which responds to dozens of disasters annually, plans to continue monitoring the account in the weeks ahead and is working with the Biden administration to understand what options the agency might have when the balance in that one account reaches zero dollars.

“We have many tools that we can implement to ensure that we always have enough funding to be able to support the life-saving and life-sustaining activities,” Criswell said, adding that her “goal” is to make sure the agency has enough money to last through the end of the fiscal year in September.

Congress, at that point, will need to pass some sort of government funding package, or begin a partial government shutdown.

The House and Senate have separately begun debating the annual government funding measures in committee, though House Republicans have decided to write their bills below the spending levels set in the bipartisan debt limit law that Congress approved earlier this year. That could make it especially challenging for the Senate, which has drafted bipartisan bills, to broker a final agreement with the House and avoid a 1% across the board spending cut that would take effect on Jan. 1 if lawmakers haven’t approved all 12 bills.

While lawmakers will likely advance a short-term government spending bill in September instead of full-year appropriations legislation, that stopgap measure would help to replenish the disaster relief fund.

Escalating numbers of natural disasters

Criswell told the U.S. House Homeland Security Committee’s subcommittee on Emergency Management and Technology that the agency has seen a significant increase in the number of natural disasters it responds to annually.

“From atmospheric rivers in January to tornadoes and wildfires in December, we can no longer speak of a disaster season,” Criswell said. “We now face intensified natural disasters throughout the year, often in places that are not used to experiencing them.”

Historic rainfall and flooding have hit Vermont in recent days.

The dynamics of natural disasters are also changing as the climate changes, Criswell testified.

“We’re seeing this convergence of different climate events come together and cause damage that we would have never anticipated,” she said.

FEMA is working to model what future natural disasters will look like, so the agency can help different regions of the country understand what crises they’ll face during the next decade and begin to prepare through mitigation, she said.

“FEMA is not an immigration agency’

FEMA is also continuing to wrap up its responsibilities related to the COVID-19 pandemic and assist with undocumented immigrants, though Criswell stressed FEMA is not an immigration agency.

Several Republicans on the panel expressed concerns that FEMA providing some assistance to migrants could stretch the agency too thin.

“FEMA has been tasked with alleviating the impact of President Biden’s failures, from resettling Afghan refugees in 2021 to now housing and feeding illegal immigrants,” said panel Chair Anthony D’Esposito, a New York Republican. “I am worried that FEMA is becoming a de facto damage control agency.”

Criswell told the subcommittee that Congress previously provided funding for an emergency food and shelter program that allowed FEMA to provide humanitarian aid. Within the last year, that program has transitioned into a shelter and service program.

“I just want to clarify for the record that FEMA is not an immigration agency,” Criswell said. “We do follow congressional direction in the program that we do have that supports that emergency food and shelter program for humanitarian efforts and now the shelter and services program.”

Criswell said she supports an item in President Joe Biden’s budget request for the upcoming fiscal year that asked Congress to appropriate $4.7 billion for a border contingency fund within the Department of Homeland Security.

“Depending on the conditions and the dynamic nature of the border, what that contingency fund also provides is up to $800 million that could be available to FEMA to support our shelter and services program,” Criswell said. “This would be the same level as fiscal year 2023.”

FEMA is housed within the Department of Homeland Security.

Flood insurance pricing

Members of the committee from both political parties expressed concern with FEMA’s newer approach to flood insurance policy costs, which it rolled out as part of the so-called Risk Ratings 2.0 program.

The new pricing for a flood insurance policy, Criswell said, is designed to charge homeowners for each home’s specific flood risk.

Rep. Troy Carter, a Louisiana Democrat and the panel’s ranking member, said he had “grave concerns” about the new costs for getting a flood insurance policy through the National Flood Insurance Program.

“Louisiana is expected to see an increase of as much as 130% on average to a single family home phased in over years,” Carter said. “This policy would ensure that hundreds if not thousands of Louisianians will be vulnerable during extreme weather occurrences because they simply cannot afford to pay for flood insurance.”

D’Esposito also expressed concerns with new flood insurance policy pricing and frustration that FEMA officials have not provided information or a briefing for members of Congress after a group of lawmakers sent a letter in May.

“To date, your agency has not produced any responsive documents, and even though we anticipated receiving a briefing last month, your staff now indicates they may not provide the briefing citing ongoing litigation,” D’Esposito said.

Criswell said she would work with her staff to respond to the lawmakers about their concerns.