Streamlined FEMA Cost Exemption Act
Streamlined FEMA Cost Exemption Act
Plain Language Summary
# Streamlined FEMA Cost Exemption Act Summary **What the Bill Would Do** This bill would make it easier for states, local governments, and tribes to keep federal disaster aid money by shortening the time FEMA has to ask for it back and allowing more flexibility in how FEMA handles payment errors. Specifically, it reduces from three years to two years the deadline for FEMA to recover disaster funds it determines were improperly spent, and it would let FEMA set its own acceptable error rate for disaster grants rather than adhering to a strict 10% standard. **Who It Affects and Key Provisions** The bill primarily affects state, local, and tribal governments that receive FEMA disaster assistance. Rather than being required to repay FEMA for errors or duplicate payments, the bill would authorize FEMA to waive these recoupment requirements in certain cases.
The shorter recovery window gives these entities less time to worry about FEMA audits and potential repayment demands years after a disaster. **Current Status** HR 3759 is currently in committee and has not yet been voted on by Congress. The bill was introduced by Rep. Neal Dunn (R-FL) in the 119th Congress.
CRS Official Summary
Streamlined FEMA Cost Exemption ActThis bill reduces to two years the statute of limitations for the Federal Emergency Management Agency (FEMA) to recoup disaster funding. It also requires FEMA to establish a ratio of acceptable error in its grants payments and authorizes the waiver of certain recoupment and duplication of benefits requirements.The bill reduces from three years to two the time period (starting from the final report of project completion) during which FEMA may take action to recover emergency or disaster assistance FEMA has provided to a state, Indian tribal, or local government. Also, under current law, FEMA generally must reduce and recover improper payments (i.e., payments that should not have been made or were made in an incorrect amount) and maintain an error rate below 10%. The bill requires FEMA to establish its own acceptable error ratio for providing emergency or disaster assistance funds for eligible purposes. It also authorizes FEMA to waive recoupment of certain emergency or disaster assistance (e.g., Public Assistance funding) when the provided funds exceed the total cost of the relevant project by no more than 5%.Additionally, the bill reauthorizes the President to waive the prohibition on the duplication of benefits upon request from the governor of a state if the President determines certain criteria are met. In exercising such authority, the President may not determine that a loan is a duplication. This authority is not applicable to FEMA’s Individual Assistance program or Public Assistance for repair and replacement.
Latest Action
Referred to the Subcommittee on Economic Development, Public Buildings, and Emergency Management.