The federal government is a significant resource for disaster preparedness and post-disaster economic recovery. Yet, navigating the federal system labyrinth of various agencies, programs and requirements can be an intimidating process. This section is designed to help economic developers understand the issues in order to effectively access disaster recovery resources in the federal system.
Limited funds, a lack of flexibility and inconsistent requirements are the primary challenges involved with accessing federal funds to restore a local economy after a disaster.
- Limited funds for business and economic recovery – The amount of federal money available for business and economic recovery is much smaller than the dollars allocated to address humanitarian needs. EDOs need to educate municipal leaders and the community on the need to expend funds on priority recovery projects, as well as to patch together resources from multiple sources for business needs.
- Lack of flexibility in the use of federal funds – Typically, federal funds are designated for specific purposes and do not provide much flexibility to meet the myriad needs of post-disaster business recovery . The time-consuming application process and bureaucracy associated with the use of federal funds (e.g., documentation to prove there is no duplication of benefits) can be a significant burden on a disaster-impacted community.
- Inconsistent requirements among different federal agencies – Many federal agencies have different, and sometimes competing, requirements for the use of funds. As EDOs and businesses look to assemble funds from a variety of sources, meeting these requirements means more time and costs in an already challenging post-disaster environment.
The role of the federal government in post-disaster response and recovery activities is significant, yet the process of understanding eligibility requirements, the application process and reporting documentation for federal programs can be overwhelming. In addition, the immediate emphasis after a disaster is on human safety and hazard mitigation. Federal resources for business and economic recovery can be slow to be distributed, so states such as Florida and Louisiana have developed bridge loan programs to provide immediate relief.
Below are the action steps for navigating the federal system in a post-disaster situation.
Step 1: Monitor whether a presidential ‘emergency’ or ‘major disaster’ has been declared or is in the process of being declared
This will enable significant federal resources to be deployed for immediate response, particularly from the Federal Emergency Management Agency (FEMA). FEMA will deploy these resources according to its procedures for processing a gubernatorial request to the President. In the absence of a presidential declaration, a community will rely mostly on local and state resources.
Step 2: Begin reaching out to federal representatives
This should include a two-pronged strategy:
- Congressional representatives – provide senators and congressional representatives with access to information on the community and economic impacts of the disaster.
- Federal agency representatives – establish contact with the appropriate federal government agencies to discuss federal funds already at their disposal for disaster recovery efforts. Economic developers often act as conduits of information between local and state elected officials and federal government agencies so communication is important. RestoretheGulf.gov can help users navigate Federal agencies and their programs. In addition, IEDC has developed a list of federal agencies that offer post-disaster resources.
Step 3: Request waivers for specific federal requirements
In a disaster situation, federal requirements for accessing funds can add an additional burden on a community and delay the recovery process. Community and economic recovery leaders need to understand accepted uses of funds as prescribed by the federal programs and request appropriate waivers.
Communities such as New York City (after 9/11) and Grand Forks, N.D. (after major flooding in 1997) requested and successfully obtained waivers of certain requirements, which expedited the delivery of assistance and enabled more flexible use of federal funds.
Step 4: Track appropriations going through Congress on how those funds will be obligated and distributed
Sometimes, special resources are provided to communities impacted by a major disaster. Typically, these funds are disbursed to a state agency for distribution among affected communities. Local stakeholders need to track and advocate for the efficient and equitable disbursement of those funds at the local level.
Step 5: Package federal resources from different sources to best meet local economic recovery needs
Typically in a disaster, communities need to patch together funding from a variety of sources (different federal agencies; public and private resources, etc.) to meet their recovery needs. As an example, JEDCO in Jefferson Parish, Louisiana, obtained funds from both EDA and HUD’s CDBG Disaster Assistance program for a revolving loan fund (RLF). This RLF provided critical assistance to hundreds of small businesses after Hurricane Katrina by distributing $50 million in loans and grants.
Economic recovery professionals will need to have a clear understanding of the requirements and waivers of various federal programs, and mitigate conflicts between these requirements when putting together such packages. They also need to understand and address Duplication of Benefits (DOB)* issues.
Step 6: Ensure your organization has the capacity to provide documentation and stay in compliance when using federal funds
As discussed above, communities need to carefully understand requirements to avoid Duplication of Benefits (DOB) associated with federal funds. They also need to know whether compliance will be performed at the state level or the local level.
Step 7: Monitor the use of federal funds and programs to maximize impact
- National Disaster Recovery Framework: Strengthening Disaster Recovery for the Nation (September 2011) describes the concepts and principles that promote effective Federal recovery assistance.
- The Federal Government recently developed a web-based resource tool, www.RestoreTheGulf.gov, to assist communities impacted by the Deepwater Gulf Oil Spill. The Guide to Federal Programs helps users to navigate through the Federal government’s resources and programs, which can be used in the event of a disaster. There is a section devoted to economic recovery.
- The SBA’s Disaster Preparedness and Disaster Recovery plan assists in navigating the SBA disaster loan programs along with implementation of the business continuity operations.
- Federal Emergency Management Agency (FEMA) has developed a list of federal agencies and organizations with preparedness, relief and recovery resources to address disasters and emergencies.
- The U.S. Government has developed DisasterAssistance.gov to provide information on how someone might be able to get help from the U.S. Government before, during and after a disaster.
- The International Economic Development Council has developed a list of federal agencies, which describes the various federal agencies and their programs that relate to economic development and economic recovery.
IMPORTANT FEDERAL PROGRAMS FOR POST-DISASTER ECONOMIC RECOVERY:
- U.S. Economic Development Administration’s (EDA) programs
- U.S. Housing and Urban Development’s (HUD) Community Development Block Grants (CDBG) Disaster Recovery Assistance program
- U.S. Small Business Administration’s (SBA) Disaster Assistance program
- U.S. Department of Agriculture’s (USDA) Rural Development Disaster Assistance Fund program
- U.S. Federal Emergency Management Agency’s (FEMA) programs
** Note on Duplication of Benefits (DOB) – DOB refers to the use of federal funds from different programs for the same purpose, which is prohibited by law. The burden of proving that there is no duplication of benefits lies on the local government disbursing funds and not the various federal agencies providing these funds. Economic developers need to ensure that there is no DOB when putting together resources from a variety of federal agencies for disaster recovery.