May 21, 2020

Cassidy, Senators Propose Eliminating FEMA Cost-Share for 2020 Disasters to Help States, Cities During Pandemic

WASHINGTON – U.S. Senators Bill Cassidy, M.D. (R-LA), Cindy Hyde-Smith (R-MS) Bob Menendez (D-N.J.) and Gary Peters (D-Mich.) today introduced legislation to eliminate the cost-share payments required of states and communities included in federal disaster declarations in 2020.

The Local Community Emergency Relief Act of 2020 is the second Senate proposal offered this week to mitigate coronavirus-related financial burdens affecting states and cities.  Not limited to the COVID-19 emergency declaration, the bill would require the Federal Emergency Management Agency (FEMA) to provide a 100 percent cost share for all federal emergency declarations and major disaster declarations during calendar year 2020. 

“State and local communities have seen their budgets devastated by the COVID-19 economic lockdown. Adding a disaster, such as a hurricane, on top of the current crisis would make recovery extremely difficult, if not impossible.  This is a forward-looking bill to prevent disasters from derailing our recovery,” said Dr. Cassidy. 

“Cities and states are incurring ongoing revenue losses related to the COVID-19 emergency, and the federal government should utilize available tools and resources to ease that burden.  This is especially the case for areas hit by disasters.  Funding to meet the FEMA cost share requirements should instead be available for local front line work to overcome the pandemic,” Hyde-Smith said.

“New Jersey is on the frontlines of the pandemic in the U.S. with over 150,000 of our fellow residents infected, more than 10,000 of our loved ones and neighbors lost, an economy that’s been shaken, and tax revenues decimated,” said Menendez.  “At a time when states and local governments across the country are considering laying off essential workers and cutting basic services for their residents, the least the federal government can do to provide some relief is waive the local match for emergency aid.  That way, those limited resources can be used to keep more police, firefighters, paramedics, teachers, transit, public health and other frontline workers on the job and the critical services they provide going.”     

“Communities in Michigan and across the country are facing unprecedented challenges as a result of the Coronavirus pandemic, and they need the full resources and support the federal government can help provide as we tackle this emergency together. That’s why I have been calling on the Administration to make this change and relieve this burden on state and local governments,” said Peters, Ranking Member of the Homeland Security and Governmental Affairs Committee.  “On top of the public health and economic crisis we’re in, communities in Mid-Michigan are being evacuated from their homes by historic flooding. Michiganders need help, and this legislation will ensure that every community will be able to get the federal aid they need to address terrible disasters like these.”

In general, FEMA disaster assistance requires a 75 percent cost-share commitment from the federal government with 25 percent provided from nonfederal sources.  This legislation would follow earlier precedents to increase the federal share beyond 75 percent to ease the burden on disaster-hit cities, counties, and states—Hurricane Katrina in 2005, Hurricane Sandy in 2012, and significant Louisiana floods in 2016.

On Monday, the bipartisan State and Municipal Assistance for Recovery and Transition (SMART) Act (S.3752) was introduced to provide $500 billion targeted to state, local, and tribal governments with flexibility to use the funds to help mitigate the need for significant layoffs, tax hikes, and interruption of essential services.