As referenced in our recent CAT-Law post on the Catastrophic Losses of 2018, at the end of 2018 Congress passed the Disaster Recovery Reform Act of 2018 (DRRA) in an effort to improve the nation’s overall capacity to respond to large-scale disasters. The DRRA reflects lawmakers’ concern that the Federal Emergency Management Agency (FEMA) alone was ill-equipped to respond to large-scale disasters, which appear to be occurring with increasing frequency and severity since Hurricane Katrina in 2005. Notably, 2017 and 2018 brought Hurricanes Harvey, Maria, and Irma in rapid succession, as well as massive wildfires in California and elsewhere.
According to FEMA, the DRRA’s “reforms acknowledge the shared responsibility of disaster response and recovery, aim to reduce the complexity of FEMA and build the nation’s capacity for the next catastrophic event.” In other words, the DRRA shifts more responsibility and funding to local and state governments and increases the focus on disaster prevention as opposed to disaster response alone.
The DRRA was supported by a number of groups, such as the National Association of Counties, the American Society of Civil Engineers, and the National Conference of State Legislatures. It was also supported by the insurance industry, in particular the Buildstrong Coalition, which, in turn, is supported by the National Association of Mutual Insurance Companies and Navigators Global. Their support is attributable, at least in part, to the DRRA’s focus on disaster prevention; specifically, the inclusion of significant reforms to the building code. According to the Buildstrong Coalition, one dollar invested on pre-disaster mitigation saved between six and eight dollars in future disaster costs; yet, prior to the DRRA, FEMA had been spending 14 times more on post-disaster mitigation than pre-disaster prevention. The DRRA was aimed at changing those ratios.
Key regulatory changes found in the DRRA include:
- Increases funding for hazard mitigation in a new national Pre-Disaster Mitigation account. The law firm Baker Donelson estimates that “At the rate and intensity of the occurrence of disaster events, this is likely to equate to billions of dollars in mitigation funding in a given year (including for the 2017 and 2018 seasons).”
- Prohibits FEMA from recouping certain funds from state and local governments, including aid provided more than three years after the date of its release.
- Allows state and local governments to administer housing assistance grants.
- Increases FEMA funding for “management costs” to state recipients, which can be passed on to a subrecipient; that is, an applicant for funding, such as a county, state agency, community, or eligible nonprofit.
- Empowers the President to waive the general ban on duplication of benefits, primarily for debris removal and emergency protective measures, found in the Stafford Act. This includes benefits received from insurance and private donors.
- Creates a presumption that “fixed estimate grants made under the alternative procedures program are ‘presumed to be reasonable and eligible costs’ (in the absence of fraud) once certified by a professionally licensed engineer and accepted by the FEMA Administrator."
- Limits a flood insurance deduction to one building within a multi-structure campus for disasters declared between Jan. 1, 2016, and Dec. 31, 2018.
- Creates new funding for local and state wildfire prevention and mitigation practices.
- Authorizes FEMA to provide grants to state and tribal governments to directly administer housing construction, including reimbursement.
- Expands grants for Other Needs Assistance and Housing Assistance, and exempts rental assistance and accessibility-related personal property costs from the maximum grant amounts.
- Requires more information sharing and transparency from FEMA.
- Orders FEMA to issue disaster-response guidance for states and other non-federal governments regarding:
- power facility outages and restoration
- code implementation and enforcement
- submerged roads, and
- evacuation routes.
The DRRA was included as part of the Federal Aviation Administration Reauthorization Act of 2018. That Act passed with overwhelming bipartisan support (398-23 in the House and 93-6 in the Senate) and was signed into law by the President on October 5, 2018. While the DRRA has not been in effect long enough to know its effects, its advocates hope that American disaster relief will become more effective, both in results and in costs to all involved.
Posted by Michael Patrick O'Brien
