[Federal Register Volume 64, Number 76 (Wednesday, April 21, 1999)]
[Rules and Regulations]
[Pages 19496-19498]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-9934]
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FEDERAL EMERGENCY MANAGEMENT AGENCY
44 CFR Part 206
RIN 3067-AC72
Disaster Assistance; Cost-share Adjustment
AGENCY: Federal Emergency Management Agency (FEMA).
ACTION: Final rule.
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SUMMARY: This rule accomplishes three objectives. First, it establishes
the financial criteria under which we, FEMA, recommend to the President
a cost-share adjustment for permanent restorative work and for
emergency work under the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (the Stafford Act). Second, the rule states
that we recommend capping the Federal share of assistance at ninety
percent (90%.) Third, we raise the $64 statewide per capita threshold
that we have used since 1985 for recommending cost-share adjustments to
current dollars, and will adjust that threshold annually in future
years. The new threshold is phased in over a gradual period. The rule
in no way affects the current process under which the President
sometimes grants one hundred percent (100%) Federal funding for
emergency work, including direct Federal assistance, for limited
periods following disaster declarations when the emergency needs
warrant it.
EFFECTIVE DATE: This rule is effective May 21, 1999.
FOR FURTHER INFORMATION CONTACT: Patricia Stahlschmidt, Response and
Recovery Directorate, Federal Emergency Management Agency, 500 C Street
SW., Washington, DC 20472, 202-646-4066, (facsimile) 202-646-4060, or
(email) patricia.stahlschmidt@fema.gov.
SUPPLEMENTARY INFORMATION:
Background
On March 5, 1998, we published a proposed rule on cost-share
adjustment under the Stafford Act, 42 U.S.C. 5121 et seq. in the
Federal Register at 63 FR 10816. We invited comments for 60 days ending
on May 4, 1998. We received nine sets of comments: two from State and
local government organizations; six from States; and one from a local
government. Three commenters generally supported placing the criteria
in regulation and annually adjusting the threshold for inflation, and
one commenter agreed with the ninety percent (90%) cap on the Federal
share of assistance. Most commenters objected to various aspects
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of the rule. Following is a summary of the comments and our responses.
Evaluation of Cost-share Adjustments
One of the most frequent comments was that there was no evaluation
or analysis of the original threshold for recommending cost-share
adjustments, and therefore there is no basis for raising this threshold
to current dollars. Further comments along this line argued that the
proposed threshold fails to consider State capability and does not
provide an incentive for mitigation. We acknowledge that there was no
analysis of the original $64 per capita threshold for recommending
cost-share adjustments. However, that threshold is widely recognized
and we have used it consistently since 1985 when we recommended the
first cost-share adjustment. We do not intend, and never intended, to
measure State capability or to provide an incentive for mitigation
through this rule. Rather, the $64 threshold is simply a yardstick to
determine when the economic impact of a disaster is of such severity
that it warrants recommendation for a cost-share adjustment. We are
quite willing to work with our State partners to identify capability or
mitigation measures that might justify consideration of a cost-share
adjustment. However, we view that as a longer-term effort separate from
this rule. With respect to measuring economic impact, no commenters
offered alternatives to the use of a per capita impact although two did
suggest that we lower the threshold to $50 per capita. We believe
instead that the 1985 threshold should be brought up to current dollars
and adjusted annually using the Consumer Price Index for All Urban
Consumers, since that is the legislative basis for annually adjusting
the small project grants under the Public Assistance Program and grants
under the Individual and Family Grant Program.
Presidential Discretion for Cost-share Adjustments
Several commenters noted that the threshold for granting cost-share
adjustments unwisely limits Presidential discretion, and fails to
account for the unique circumstances of a disaster. We believe that the
rule adequately allows for Presidential discretion. First, the wording
of the rule has been revised to state that we would recommend to the
President when a cost-share adjustment is warranted in recognition of
the fact that the President retains the authority for actually granting
cost-share adjustments. Secondly, the rule clearly recognizes that,
irrespective of the economic threshold established here, the President
may continue the practice of granting up to one hundred percent (100%)
Federal funding for emergency work when he believes such action is
warranted in the early days of the disaster.
Multiple Disasters
Several commenters noted that the rule contains no provision for
multiple disasters within a State. We agree, and have revised the rule
to state that we will consider the effect of major disaster
declarations in a State within the preceding twelve months. The final
rule does not specifically indicate how we will consider multiple
disasters because that would depend on the circumstances. We need to
consider the timing of the disasters, the size, and the location when
we review the impact of multiple disasters. For example, two very large
disasters that strike the same area of a State might have a much
greater economic impact than widely disbursed small disasters in the
State even though the cumulative per capita impact might be similar.
Statewide Population Factors
A number of other commenters noted that the per capita threshold
should consider the relative densities within a State, or should be
based on the county and not on statewide population. We will continue
to base the threshold on the statewide population to reflect the
supplemental nature of Federal disaster assistance and the State's
preeminent role in this partnership. The declaration process itself
analyzes the localized impacts of the disaster when we recommend which
counties should be granted Federal disaster assistance. If a State
wishes to adjust the nonfederal cost-share burden in certain areas of
the State it can do so through the State/applicant split of the
nonfederal cost-share.
Actual Stafford Act Obligations To Measure per Capita Impact
Several commenters noted that the nonfederal share and State
administrative costs should be included in the calculation of statewide
per capita impact, and that the threshold should be based on estimates.
We currently consider only actual obligations when determining the per
capita impact of a disaster and will continue that practice. Actual
obligations provide a better and more consistent measure of the impact
of a disaster than do estimates, which can vary widely from disaster to
disaster and can change dramatically over the course of the disaster.
In order to be consistent in our method of measuring the per capita
impact we will also continue our practice of measuring Stafford Act
obligations only. State administrative costs have been and will
continue to be considered when we measure per capita costs though we do
not include our administrative costs in the calculation.
Limitation on Use of Sliding Scales
Three commenters noted that Sec. 320 of the Stafford Act precludes
any geographic area from receiving assistance under the Act solely by
virtue of an arithmetic formula or sliding scale based on income or
population. We are well aware of this provision of the Act but do not
violate it because the rule does not prohibit any geographic area from
receiving assistance under the Act. The rule merely determines when a
more favorable cost-share adjustment may be recommended.
Gross Domestic Product as a Measure of Impact
One commenter noted that in the 1993 floods that affected nine
Midwestern States the President used 0.1 percent of the gross domestic
product (GDP) as the measure to determine that a cost-share adjustment
would be recommended for all nine States. That GDP measurement was not
mentioned in the proposed rule because it has come to be a one-time-
only measurement. In more recent multi-state flood disasters in the
Upper Midwest and Ohio River basins we considered only the per capita
threshold as the basis for recommending a cost-share adjustment.
Timeframe for Implementation
One commenter noted that the proposed timeframe for implementation
is no longer relevant. We recognize that it is no longer relevant. Due
to the length of time for publication, comment and review of comments,
the timeframe for implementation of the new threshold will now begin in
calendar year 1999 on May 21, 1999 and not in fiscal year 1998. The
phase-in period to bring the threshold up to current dollars has also
been extended to address concerns about the increase in the threshold.
National Environmental Policy Act
44 CFR part 10 categorically excludes this rule from its
requirements. We have not prepared an environmental assessment.
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Executive Order 12866, Regulatory Planning and Review
This rule is not a significant regulatory action within the meaning
of section 2(f) of E.O. 12866 of September 30, 1993, 58 FR 51735, but
attempts to adhere to the regulatory principles set forth in E.O.
12866. The Office of Management and Budget has not reviewed this rule
under E.O. 12866.
Paperwork Reduction Act
This rule does not contain a collection of information and
therefore is not subject to the provisions of the Paperwork Reduction
Act of 1995.
Executive Order 12612, Federalism
This rule involves no policies that have federalism implications
under E.O. 12612, Federalism, dated October 16, 1987.
Executive Order 12778, Civil Justice Reform
This rule meets the applicable standards of section 2(b)(2) of E.O.
12778.
Congressional Review of Agency Rulemaking
We have sent this final rule to the Congress and to the General
Accounting Office under the Congressional Review of Agency Rulemaking
Act, Pub. L. 104-121. The rule is not a ``major rule'' within the
meaning of that Act. It is an administrative action in support of
normal day-to-day activities. It establishes the financial criteria
under which we would recommend a cost-share adjustment for permanent
restorative work and for emergency work, and recommends capping the
Federal cost-share for permanent restorative work at ninety percent
(90%). The rule does not result in nor is it likely to result in an
annual effect on the economy of $100,000,000 or more. It will not
result in a major increase in costs or prices for consumers, individual
industries, Federal, State, or local government agencies, or geographic
regions. It will not have ``significant adverse effects'' on
competition, employment, investment, productivity, innovation, or on
the ability of United States-based enterprises to compete with foreign-
based enterprises.
This final rule is exempt (1) from the requirements of the
Regulatory Flexibility Act, and (2) from the Paperwork Reduction Act.
The rule is not an unfunded Federal mandate within the meaning of the
Unfunded Mandates Reform Act of 1995, Pub. L. 104-4. It does not meet
the $100,000,000 threshold of that Act, and any enforceable duties are
imposed as a condition of Federal assistance or a duty arising from
participation in a voluntary Federal program.
List of Subjects in 44 CFR Part 206
Administrative practice and procedure, Disaster assistance,
Intergovernmental relations, Reporting and recordkeeping requirements.
Accordingly, 44 CFR Part 206 is amended as follows:
PART 206 SUBPART B--THE DECLARATION PROCESS
1. The authority citation for part 206 continues to read as
follows:
Authority: The Robert T. Stafford Disaster Relief and Emergency
Assistance Act, 42 U.S.C. 5121 et seq.; Reorganization Plan No. 3 of
1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; E.O. 12127, 44 FR
19367, 3 CFR, 1979 Comp., p. 376; E.O. 12148, 44 FR 43239, 3 CFR,
1979 Comp., p. 412; and E.O. 12673, 54 FR 12571, 3 CFR, 1989 Comp.,
p. 214.
2. We are adding Sec. 206.47 to read as follows.
Sec. 206.47 Cost-share adjustments.
(a) We pay seventy-five percent (75%) of the eligible cost of
permanent restorative work under section 406 of the Stafford Act and
for emergency work under section 403 and section 407 of the Stafford
Act, unless the Federal share is increased under this section.
(b) We recommend an increase in the Federal cost share from
seventy-five percent (75%) to not more than ninety percent (90%) of the
eligible cost of permanent work under section 406 and of emergency work
under section 403 and section 407 whenever a disaster is so
extraordinary that actual Federal obligations under the Stafford Act,
excluding FEMA administrative cost, meet or exceed a qualifying
threshold of:
(1) Beginning in 1999 and effective for disasters declared on or
after May 21, 1999, $75 per capita of State population;
(2) Effective for disasters declared after January 1, 2000, and
through December 31, 2000, $85 per capita of State population;
(3) Effective for disasters declared after January 1, 2001, $100
per capita of State population; and,
(4) Effective for disasters declared after January 1, 2002 and for
later years, $100 per capita of State population, adjusted annually for
inflation using the Consumer Price Index for All Urban Consumers
published annually by the Department of Labor.
(c) When we determine whether to recommend a cost-share adjustment
we consider the impact of major disaster declarations in the State
during the preceding twelve-month period.
(d) If warranted by the needs of the disaster, we recommend up to
one hundred percent (100%) Federal funding for emergency work under
section 403 and section 407, including direct Federal assistance, for a
limited period in the initial days of the disaster irrespective of the
per capita impact.
Dated: April 14, 1999.
James L. Witt,
Director.
[FR Doc. 99-9934 Filed 4-20-99; 8:45 am]
BILLING CODE 6718-02-P
