FEMA freezes disaster funding; residents may be left in cold


FEMA disaster cleanup funds are being frozen until Congress can allocate more funding. Image: Flickr / daquellamanera / CC-BY-SA

Cleaning up after a major natural disaster is expensive. The Federal Emergency Management Agency acts as safeguard to help pay for the cleanup and help residents get back on their feet. The cleanup from Irene is expected to cost as much as $7 billion, a part of which FEMA should be responsible for, but the agency simply does not have the money.

FEMA cutting payouts

The Federal Emergency Management Agency has less than $800 million right now. Generally, FEMA will put a freeze on payouts if it has less than $1 billion available for immediate use. A significant amount of the $800 million in FEMA funds available are already earmarked for flood and tornado cleanup. FEMA has frozen much of that aid money in order to provide immediate cleanup funds to the Hurricane Irene victims. These cuts are not being made to immediate projects or temporary housing. Instead, payments are being cut to long-term rebuilding projects.

Politicians promising money – kind of

In May of this year, FEMA’s director Craig Fugate warned Congress that the agency was facing a shortfall. Republican lawmakers have released a statement blaming the White House for leaving FEMA high and dry without funding in the face of disasters, though Eric Cantor, a Virginia congressman whose district was hard-hit by Hurricane Irene, has said that money for FEMA is coming, but that the money must be offset by cuts elsewhere in the government. Congress does have the authority to pass emergency funding bills that would provide FEMA several billion dollars without affecting current budget negotiations.

Protecting yourself before a disaster

Though Congress and FEMA have yet to work out the details of emergency funding, the reality is that federal money rarely covers the whole cost of a disaster. Preparation is the key for most families, and getting set up with a few basics before a disaster hits is most helpful. First, research supplemental insurance and, if necessary, purchase it. Second, you should keep emergency supplies and cash in a secure place and retrieve them before a disaster. Supplies can skyrocket in price immediately after a disaster, when demand is high.

Protecting yourself after a disaster

After a disaster, you should be on the lookout for contractors or so-called “storm chasers” that charge sky-high prices for help. You should also contact insurance, credit card and finance companies to inform them that you have been hit by a disaster. Special concessions are sometimes given to individuals who have been disaster victims, and a note can be placed in your credit report. You should also stay vigilant because of the possibility of identity theft. The mail and personal information that can be found at uninhabited homes is ripe for identity theft. Finally, be willing to ask for help. The National Voluntary Organizations Active In Disasters directory can provide a list of national and state non-profits that are set up to help disaster victims.


Democrat and Chronicle
CNN Money
National Voluntary Organizations Active in Disaster
American Red Cross

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