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Tuesday, August 20, 2013

Disaster Relief Funding and Supplemental Appropriations for Disaster Relief

Bruce R. Lindsay
Analyst in American National Government

Justin Murray
Information Research Specialist

When a state is overwhelmed by an emergency or disaster, the governor may request assistance from the federal government. Federal assistance is contingent on whether the President issues an emergency or major disaster declaration. Once the declaration has been issued the Federal Emergency Management Agency (FEMA) provides disaster relief through the use of the Disaster Relief Fund (DRF), which is the source of funding for the Robert T. Stafford Emergency Relief and Disaster Assistance Act response and recovery programs. Congress appropriates money to the DRF to ensure that funding for disaster relief is available to help individuals and communities stricken by emergencies and major disasters (in addition, Congress appropriates disaster funds to other accounts administered by other federal agencies pursuant to federal statutes that authorize specific types of disaster relief).

Historically, the DRF is generally funded at a level that is sufficient for what are known as “normal” disasters. These are incidents for which DRF outlays are less than $500 million. When a large disaster occurs, funding for the DRF may be augmented through emergency supplemental appropriations. A supplemental appropriation generally provides additional budget authority during the current fiscal year to (1) finance activities not provided for in the regular appropriation; or (2) provide funds when the regular appropriation is deemed insufficient.

This methodology used to budget the DRF appears to have been altered since the passage of the Budget Control Act (P.L. 112-25). The Budget Control Act includes a series of provisions that directed the Office of Management and Budget (OMB) to annually calculate an “allowable adjustment” for disaster relief to the BCA’s discretionary spending caps. That adjustment, if used, would make additional budget authority available for the federal costs incurred by major disasters declared under the Stafford Act beyond what is allowed in the regular discretionary budget allocation. The OMB calculation may have provided a mechanism that encourages a larger regular appropriation to the DRF. It is possible that larger DRF appropriations may reduce the need for supplemental appropriations.

Budgeting for disaster relief has been the subject of a great deal of debate. Some argue that more money should be appropriated in FEMA’s DRF account in annual appropriations, while others maintain that augmenting the DRF through supplemental appropriations is preferable because it allows Congress to react directly to a particular situation. Others may argue that emergency supplemental appropriations are preferable for fiscal management reasons because an appropriation is not requested unless there is a real need for supplemental funding. Another argument is to revamp the budgetary process to fund disaster relief.

This report describes the various components of the DRF, including (1) what authorities have shaped it over the years; (2) how FEMA determines the amount of the appropriation requested to Congress (pertaining to the DRF); and (3) how emergency supplemental appropriations are requested. Information is also provided on funds appropriated in supplemental appropriations legislation to agencies other than the Department of Homeland Security (DHS). Aspects of debate concerning how disaster relief is budgeted are also highlighted and examined, and alternative budgetary options are summarized.

Date of Report: August 5, 2013
Number of Pages: 28
Order Number: R40708
Price: $29.95

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