Disaster Assistance:

Improvements Needed in Determining Eligibility for Public Assistance

RCED-96-113: Published: May 23, 1996. Publicly Released: May 31, 1996.

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Pursuant to a congressional request, GAO reviewed the Federal Emergency Management Agency's (FEMA) public assistance program, focusing on: (1) its procedures for determining eligibility for public assistance; (2) its efforts to ensure that funds are spent in accordance with authorized work; and (3) options to modify FEMA eligibility criteria.

GAO found that: (1) while FEMA must fund the restoration of eligible facilities in accordance with applicable building codes, it is unclear whether the building codes that existed before the disaster or at the time of restoration should apply; (2) the eligibility of certain private, nonprofit facilities that provide essential governmental services to the general public is unclear; (3) without clear eligibility criteria, FEMA cannot control program costs or ensure consistent eligibility determinations; (4) eligibility determinations were not systematically codified and disseminated to FEMA personnel; (5) FEMA relies on states, independent audits, and its inspector general to ensure that federal funds are only spent on eligible restorations; and (6) changing various eligibility requirements in accordance with FEMA program officials' recommendations could reduce FEMA public assistance program costs.

Recommendations for Executive Action

  1. Status: Closed - Implemented

    Comments: As part of its redesign of the Public Assistance program, FEMA has developed and disseminated written policies designed to make eligibility determinations less subjective. The agency has established criteria that more clearly and comprehensively identify eligible versus ineligible facilities and work under the Public Assistance program. FEMA's policies are disseminated online to all parties, and the agency has revised its training to incorporate policy changes. Finally, FEMA has established a detailed policy that provides clarification on eligible costs of upgrading only parts of structures, as well as what types of private nonprofit organizations and facilities are eligible for disaster assistance.

    Recommendation: The Director, FEMA, should issue criteria that more clearly and comprehensively identify what facilities and work are eligible for public assistance and develop a system for disseminating these and future changes in criteria to FEMA regional staff. The Director should specifically clarify the criteria for determining the extent to which the permanent restoration of disaster-damaged facilities is eligible for funding and the eligibility of private nonprofit facilities.

    Agency Affected: Federal Emergency Management Agency

  2. Status: Closed - Implemented

    Comments: FEMA has taken some form of action on all of the twelve options that GAO identified and believes that congressional action is needed to further clarify three policies. FEMA has implemented policies that revise its appeals process, limit the impact of building codes and standards, and eliminate the eligibility for facilities not actively used for government services. The agency has also taken action to further clarify a number of policies. These include the eligibility of revenue-generating nonprofits and public versus private recreation facilities. FEMA believes that congressional action will be needed for any further clarification of eligibility for revenue-generating non-profit organizations. The action FEMA took on two other options, namely eliminating post-disaster beach renourishment and raising the 50 percent damage threshold, also led it to conclude that congressional action will be needed to further clarify these policies. Lastly, FEMA has started developing a regulatory rule to consider making a minimum amount of building insurance coverage a criterion for eligibility for public assistance. The agency published an advance notice of proposed rulemaking in February 2000 and is also considering conducting a study on insurance coverage in the public sector. FEMA does not have an estimate of when it plans to conclude its work for this rulemaking process.

    Recommendation: The Director, FEMA, should determine whether the identified options should be implemented and, if so, take actions to implement them, including, if necessary, proposing changes to legislation or FEMA regulations.

    Agency Affected: Federal Emergency Management Agency


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