For the past 35 years, the Federal Emergency Management Agency, commonly known as FEMA, has been dedicated to preparing, protecting, responding and serving the American people following major disasters and crisis. Effective on April 1, 1979 under President Jimmy Carter’s administration and funded through federal funding, FEMA has been committed to preparing, protecting, responding and assisting in recovery efforts in the state as well as the local government during crisis and disasters. Similarly to any agency, FEMA has faced many challenges when providing funding to victims and survivors of disasters. Critics have criticized FEMA in their response to disasters.
Prior to FEMA, there was the Congressional Act of 1803. This Act was the first disaster legislation available to the American people. The Act was able to provide the town of Portsmouth, New Hampshire with assistance after an extensive fire swept through the town in 1802 (FEMA, 2010). Congress provided the state and local governments with federal funding to rebuild after the disaster. Throughout the 19th century, there were many extensive fires including one in New York City in 1835 and the Great Chicago Fire of 1871 ( FEMA, 2010). These disasters caused Congress to ad hoc legislation to protect and assist the survivors. The survivors were able to have their financial obligations temporarily suspended. During the 1920’s under President Calvin Coolidge’s administration, the Federal government provided minimal financial assistance to victims of disasters. On the contrary, the government insisted on the American citizens to assist and donate to the relief efforts. Disaster responses were generally funded through local governments and voluntary groups. The Federal government ‘funded disaster recovery on an incident-by-incident basis (Baca, 2008). Created in 1932 by President Herbert Hoover, the Reconstruction Finance Corporation Act (RFC) provided disaster loans for reparation and reconstructions following disasters (Haddow).
Passed in 1950 by Congress, the Federal Disaster Relief Act was available to state and local governments as a supplement and to "alleviate suffering and damage" caused by major disasters (CRS). This act also had two other provisions; (1) it authorized the President to distribute federal funds without being consented by Congress (2) it began the process of the governor asking the President for disaster funds for their respective state. The enactment of the Disaster Relief Act of 1966 expanded the Federal assistance program into ‘the recovery arena’ (Baca, 2008). Signed by President Richard Nixon, the act authorized the the federal government to "provide disaster loans below market rates" (CRS, 2011). The Act was later revised in 1974 to the Disaster Relief Act of 1974. The Act was the first program to assist individuals directly through the Individual and Family Grant Program (IFG) (CRS, 2011). The IFG provided assistance for essential items such as clothing. The Act also assisted the state and local governments by providing funding for ‘repair and replacement of public facilities’ (FEMA, 2010). The Disaster Relief Act was amended in November 1988 by the Robert Stafford Disaster Relief and Emergency Assistance Act (FEMA 2010). The system created by this Act, which is presently used today, authorized the federal government to respond and assist the state and local governments as well as individuals following disasters. The Act authorized the President to declare major disaster zones and emergency at the request of the effected states. The goal was for the government’s to assist in saving lives, provide cash grants for essential needs, unemployment assistance, assistance in repairing and rebuilding with residential buildings, commercial buildings and public infrastructure.
Prior to FEMA, requesting assistance from the federal government had become a major problem. By the request of organizations, such as the National Governors Association (NGA), to consolidate the number of agencies state and local governments worked with for assistance, FEMA was created through Executive order 12127 on April 1, 1979 by President Jimmy Carter (FEMA, 2014). Prior to the introduction of the single agency, FEMA, there were numerous agency’s assisting in the aid of disasters. Executive Order 12148 absorbed functions from various agencies into one. Some of the agencies were; General Service Administration (federal preparedness), The Federal Insurance Administration, The National Fire Prevention and Control, and The National Weather Service Community of Preparedness Program. As Anne Marie Baca expressed in her report, the Executive orders ‘consolidated authority for both manmade and natural disaster preparation, mitigation, response and recovery’ into one agency (Baca 2008). The mission of FEMA ‘is to support the citizens and first responders to ensure that as a nation we work together to build, sustain and improve our capability to prepare for, protect against, respond to, recover from and mitigate all hazards’ (FEMA, 2014). Under the leadership of FEMA’s first director, John Macy, the Integrated Emergency Management System was introduced. The System was centralized and ‘provided direction, control, and warming systems common to the full range of emergencies from small, isolated events to the ultimate emergency- war’ (FEMA 2010).
Once a disaster has been declared, FEMA provides assistance through their main account called the Disaster Relief Fund (DRF). DRF is ‘the source of funding for the Robert Stafford Emergency Relief and Disaster Assistance Act response and recover programs’ (CRS, ). Funds for the DRF are provided by the government through regular appropriations. DRF generally provides funds for what they call ‘normal’ disasters which are incidents that are $500 million or less. Once these funds are exhausted or go above $500 then a supplemental fund is provided. ‘FEMA is the second-largest recipient of supplemental appropriations’ (CRS). Funds are divided into three categories; individual assistance, public assistance hazard mitigation. Individual assistance provides funds for what is not covered by insurance, unemployment due to the disaster, and housing for individuals that were displaced. FEMA’s largest funded program is public assistance. Public assistance ‘helps communities absorb the costs of emergency measures’ (CRS). Such measures include removals of debris and repatriations. The third category Hazard Mitigation, ‘funds measures to prevent or lessen the effect of a future disaster through the Hazard Mitigation Grant Program’ (CRS). FEMA will determine is an individual is eligible to receive assistance. The question arises; how is the DRF funded? Each fiscal year, FEMA and the Office of Management and Budget (OMB) ‘submit a request to the President for the amount the two agencies determine the DRF should receive (CRS). The President may agree or disagree with the request. Once the request is submitted to the President, an administrative request is then sent to Congress. There are four points used when doing a budget recommendation; (1) available appropriation (2) DRF monthly average (3) monthly cost estimates for catastrophic events (4) estimated recoveries of unobligated funds (CRS). The equation used to determine the end-of-fiscal year is subtraction the cumulative DRF averages from the cost estimates, the difference is then added with the cumulative recoveries. ‘The DRF end-of-fiscal year estimate is revised monthly, based on the actual obligations that are recorded in lieu of the monthly estimates, and new estimates submitted for ‘open’ incidents’ ( CRS). According to an analysis conducted by the CRS for administration budget and appropriation statues, the average administrative request since the fiscal year of 1989 was $1.7billion, with the lowest request in 1992 for $286 million and the largest in 2001 for $3.6 billion. The lowest appropriation request was in 1991 for $0 and the largest was in 2000 for $3.5 billion. For the fiscal year of 2005 (year of Hurricane Katrina, Rita and Wilma) the administrative request was $2.4 billion and the appropriation was $2.3 billion. As of fiscal year 2013, the budget for FEMA was $13.6 billion (FEMA, 2013). During the FY 2013, there were also notable decreases in the DRF (-$987 million), pre-disaster mitigation ($35.5 million), and salaries and expenses (-$242.2 million) (FEMA 2013)
The debate for funding of disaster has been a long standing debate. Concerns were arising due ‘high levels of federal spending and the inability to institute fiscal planning mechanism’ (CRS). Some argue in lowering the deficit through budget procedures enforced by Congress. Others argue the supplemental appropriations ‘make budgets appear to forecast a lower deficit’. The debate of funding ultimately is divided into two categories (1) pro-supplemental appropriations (2) opposed supplemental appropriations. Those that are pro-supplemental appropriations argue because disasters are unpredictable, obtaining funds solely on regular appropriations will be a challenge and will cause less funding to other programs. Those opposed to supplemental appropriations argue it may result in high funding levels due to the overstatement of actual needs.
Starting in the 20th century, the government was starting to undergo scrutiny due to its responsiveness of disasters. Critics noted ‘a lack of coordination and the fact that, at the Federal Level, no single entity was responsible for coordinating Federal response and recovery efforts during large-scale disasters and emergencies’ (FEMA, 2010). In its early years, FEMA experienced many challenges and started feeling the heat in its response to the Loma Prieta Earthquake, Hurricane Hugo of 1989 and Hurricane Andrew in 1992. Following Hurricane Andrew, the lapse of response from the federal government was blamed primarily on the inability of many parts of the agency to function as one. Many citizens were displaced and thousands were left without access to clean water and food. It took FEMA five days to respond to the local government. The total amount of damaged caused by Andrew exceeded $20 billion – $1 million in damages to agriculture, $250 million in loss of income for victims of the storm, and $580 million in structural damages (Florida state). On February 26, 1993, with the bombing of the World Trade Center, FEMA face a new set of challenges ‘ terrorism on US soil. Two years later, on April 19, 1995, they faced another terrorist act with the bombing of the Alfred P. Murrah Federal building in Oklahoma City. The 1993 bombing was a test of FEMA’s reforms since the hurricanes and earthquakes.
After being scrutinized FEMA faced in the early part of the 20th century, James Lee Witt is appointed Director of FEMA under the President Clinton’s administration. Under Witt’s tenure, the agency underwent numerous of reforms to gain back the trust of the American citizens by making the agency more in-tune and making it more readily available to the state and local governments following disasters. Witt along with other top leaders ‘streamlined disaster relief and recovery operations, emphasize preparedness, and mitigation’ (FEMA, 2010). In 2001, Witt was replaced by Joe Allbaugh, under President Bush’s administration. Allbaugh sets out to reduce the FEMA by following Bush’s place of budget-cuts.
During the 21st century, the U.S. experienced a few severe disaster; the September 11, 2001 attacks on the World Trade Center and the 2005 hurricane season (Hurricane Katrina, Rita, Wilma). These disasters resulted in billions of dollars worth of damage. Following the September 11, 2001 attacks of the World Trade Center, the Office of Homeland Security ( OHS) was created. Through OHS, came Department of Homeland Security (DHS) which incorporated several different agencies including FEMA in March of 2003. FEMA was included in the DHS due to its goal in preparing, responding, recovering, and assisting the US in disasters and crisis despite the magnitude and also the assistance it had provided after terrorist attack on U.S. soil (i.e the 1995 Oklahoma bombing on the Murrah Federal building and the 1993 bombing on the World Trade Center). During the early years of the DHS and FEMA merger, the majority of the grant programs were no longer focused on flooding and hurricane threats but were geared toward the threat of terrorism (Bullock, Haddow & Coppola, 2012). Terrorism as Director Michael Brown called it was ‘the issue du jour’ (PBS, 2005). The shift on the focus to terrorism and the reduction of the role of FEMA, would later affect the recovery of Hurricane Katrina. Despite refocusing the agency to terrorism and funding cuts, Brown sponsored a plan for a mock major hurricane called Hurricane Pam. Coincidently; the exercise was a scenario of a catastrophic hurricane hitting New Orleans. President George W. Bush cut funding for the program and in June of 2005, there were talks to further reduce FEMA. Director Brown expressed major concerns about the lack of funding and the lack of preparedness the organization was undergoing. The exercise estimated a total of $40 billion worth of damages in Louisiana’s commercial and residential structures, actual estimate for Katrina was $80 billion (Beriwal, 2006)
Two months after talks of reducing FEMA, lack of unity within the department and proposed cuts, Director Brown’s concerns come to reality (Drum). On August 29, 2005, Hurricane Katrina made land fall and left a path of billions of dollars worth of destruction from housing to infrastructure along the Gulf Coast. The government received a lot of criticism but not as much as Brown. As Professor Peter Davis expressed to NBC News, "FEMA’s transfer into the Department of Homeland Security led to a slow, inadequate and poorly coordinated response to a predictable event". Within the same year of Hurricane Katrina, the Golf Coast and the southeast U.S were affected with two other catastrophic hurricanes; Rita (September 2005) and Wilma (October 2005). All three hurricanes left behind a trail of destructions and billions of dollars of reparations. One major controversy surrounding FEMA post Katrina was the purchase of 145,000 mobile home and trailers for survivors of the storms who lost their homes. It was reported FEMA spent $2.7 billion on the purchase (estimate $19,000 per unit). By March of 2007, FEMA was selling many of the trailers to survivors for 40 cents on the dollar (Kaufman, 2008). A total of 10,800 homes were sold through the General Service Administration (GSA) and at least 850 were sold directly from FEMA (Kaufman, 2008). Shortly after the sales, the FEMA began a buyback program for the homes sold directly from GSA, due to concerns of the homes being tainted with formaldehyde. There discussion early on in the program of the risk of formaldehyde being present in the trailers but FEMA was slow in responding to the complaints.
During the fiscal year of 2005, four emergency supplemental appropriations were enacted by Congress post Katrina. Two of the appropriations (P.L 109-61 and P.L 109-62) amounted to a total of $62.6 billion for response and recovery needs (NBC News). Two additional supplemental appropriations were enacted after Hurricanes Rita and Wilma in the 2006 fiscal year. The Department of Defense had overturned $34 billions previously appropriated to the DHS and allocated $29 billion to other programs in order to assist with damages. In the same fiscal year, an administrative request for an additional $19.3 billion in supplemental appropriations was also approved by Congress. As of April 2014, $5.3 billion dollars have been for individual assistance and $3.7 billion for housing assistance for families affected by Katrina (FEMA 2014). The affected communities have received $11.4 billion in public assistance grants. In May of 2007, law P.L. 110-28 was signed by President George W. Bush. This law allocated $7.6 billion for disaster assistance for Hurricane Katrina recovery ($6.9 allocated to the recovery efforts). Law P.L. 110-116, signed in November 2007, and allocated $6.3 billion mainly for recovery efforts due to the effects of Hurricane Katrina, Rita, and Wilma. Another $8.4 billion of disaster assistance was provided to further assist in the recovery efforts. The Gulf Coast received continued funds to assist in the recovery and rebuilding efforts. Through a mandate passed by Congress, FEMA had to submit their monthly reports on the DRF for Fiscal Year 2007. The reports included details for "allocations, obligations, and expenditures for Hurricane Katrina, Rita and Wilma" (CRS). In the 2008 fiscal year, the Supplemental Appropriations Act was enacted by Congress. This act included various funding; $100 million for the Economic Development Administration program, $73 million for Louisiana Road Home Program, and $300 million for Department of Housing and Urban Development (HUD). The majority of the assistance funding was directed to the Corps of Engineers for reparations of storm damages and also to mitigate against future disasters. After the enactment of the act, the total amount of supplemental funding had surpassed $130 billion. Even with the high level of funding, Congress authorized a transfer of $712 million from FEMA to the Small Business Administration for disaster loans. Three months after the enactment of the Supplemental Appropriations Act, the Consolidated Security, Disaster Assistance, and Continuing Appropriations Act of 2009 was passed. This act provided ongoing assistance from the 2005 hurricanes. It included funds; $85 million for the Tenant-Base Assistance program, $15 million for the Public Housing Capital Fund, and $15 for school education for students left homeless by the storms. In the 2010 fiscal year, law P.L. 111-212 was passed. This law provided continuing funding for the recovery project in the Gulf Coast. The law also paid ‘claims awarded by arbitrators to state, local, and nonprofits for damages resulting from Hurricane Katrina’ (CRS). The majority of the claims were to disputes caused by damages. An example given by the the Congressional Research Service, the Louisiana Charity Hospital was in a legal battle with FEMA of damages caused by Hurricane Katrina. FEMA disputed the damages were storm related and argued the damages were due to an aging building and offered to pay $150 million for repairs. The arbiters ruled in favor the hospital and ruled FEMA must pay the hospital $475 million for storm related damages.
As result to the response of the Hurricane, the Post Katrina Emergency Management Reform Act (PKEMRA) Act was enacted in October 2006. This act shifted many responsibilities back to FEMA that had been removed due to the merger with DHS, added additional responsibilities such as provide housing assistance, and amended the Homeland Security Act. Responsibilities given back to FEMA were grant programs and new training exercises (FEMA, 2010). The intentional resifting of responsibilities by Congress to the DHS, was to remind the department the focus is not only on terrorism but also natural disasters and the needs for both need to be a balanced. The primary recipient of supplemental funding for disaster assistance related to Hurricanes Katrina, Rita and Wilma was the DHS. The DHS received 57% of funding, Army Corps of Engineers received 16%, Department of Defense received 7%, and the Department of Transportation received 3%.
Although FEMA strives to improve, the Government Accountability Office (GAO) has been able to pinpoint inadequacies in the agency. In a study conducted by the GAO from 2000 through 2006, the GAO brought into question the budgeting practices of FEMA for disasters. The study looked at the estimated cost that FEMA declared and compared it to the actual cost for 83 noncatastrophic natural disasters. The study provided percentage differences for 2000 through 2004 natural disasters (2005 and 2006 disasters were not included). It provided information immediately following the disaster and post-three, six, and 1 year following the disasters. Results concluded within the first three months following a storm, the average cost requested was within 23% of the actual cost and the median was 14%. It further concluded the difference of the average cost did not meet 10% until one year, while the actual cost difference met 10% within six months. As stated in the study, it is difficult to budget for FEMA because ‘the number, severity, and timing of disasters are unknown’ (GAO, 2008) so the budget is constantly fluctuated. The agency is budgeting when there is no major crisis/ disaster and making large expenses when disaster strikes. Due to this unknown, majority of funding provided by FEMA is through supplemental appropriations rather than regular appropriations. Critics have criticized FEMA over concerns of high level of federal spending and the lack of proper budgeting. A few have proposed options for restructuring the budgetary planning mechanism for FEMA. Four options are; (1)eliminate nonemergency funding (2)strengthen declaration criteria (3) increase funding to the DRF (4) create a reserve account or a rainy-day fund that can be funded through cuts in other programs (CRS).
With 35 years of serving the American people, FEMA is remained committed in its mission to prepare, protect, respond, recover, and mitigate. Faced with many challenges, the agency has continued its efforts in reforming to address critics concerns. Although difficult to determine, budgeting for disasters and crisis will be a long standing issue that will one day be controlled.