Introduction

The Disaster Relief Fund (DRF) is one of the most-tracked single accounts funded by Congress each year. Managed by the Federal Emergency Management Agency (FEMA), it is the primary source of funding for the federal government's domestic general disaster relief programs. These programs, authorized under the Robert T. Stafford Disaster Relief and Emergency Assistance Act, as amended (42 U.S.C. 5121 et seq.), outline the federal role in supporting state, local, tribal, and territorial governments as they respond to and recover from a variety of incidents. They take effect in the event that nonfederal levels of government find their capacities to deal with an incident overwhelmed.

Although the concept of general disaster relief provided by the federal government predates both FEMA and the Stafford Act, federal involvement in relief after natural and man-made disasters was very rare before the Civil War and was at times considered unconstitutional. Domestic disaster relief efforts became more common after the Civil War, but were not seen as a necessary obligation of the federal government. Standing federal domestic disaster relief programs and a pool of resources to fund them only emerged after the Second World War. Prior to the development of these programs, domestic disaster relief and recovery was a matter for private nongovernmental organizations and state and local governments.

Once established, the federal role in domestic disaster response and recovery grew, proving politically popular and resilient despite periodic concerns about management, execution, and budgetary impacts. The DRF is the primary source of funding for most general disaster relief programs, so it is an indicator of the scope of those programs and the volume of taxpayer-funded aid they provide. Understanding the trends in the growth of the federal government's role in general disaster relief and recovery, and the associated costs of that role, may be useful as Congress considers changes in both emergency management and budgetary policies.

This report introduces the DRF and provides a brief history of federal disaster relief programs. It goes on to discuss the appropriations that fund the DRF, and provides a funding history from FY1964 to the present day, discussing factors that contributed to those changing appropriations levels. It concludes with discussion of how the budget request for the DRF has been developed and structured, given the unpredictability of the annual budgetary impact of disasters, and raises some potential issues for congressional consideration.

What is the Disaster Relief Fund and how is it used?

The DRF is the primary source of funding for the federal government's general disaster relief program—response and recovery activities pursuant to a range of domestic emergencies and disasters defined in law—as opposed to specific relief and recovery initiatives that may be enacted for individual incidents.¹

What determines whether an incident qualifies as an emergency or disaster?

Under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (P.L. 93-288, as amended; hereinafter "the Stafford Act"), the President can declare that an emergency exists or a major disaster is occurring.² These declarations make state, tribal, territorial, and local governments³ eligible for a variety of assistance programs, many of which are funded from the DRF.⁴ Such declarations usually are made at the request of a state, tribal, or territorial government.

Does all federally funded disaster relief come from the DRF?

While the DRF funds Stafford Act disaster relief and recovery programs, several other federal departments and agencies have significant roles in disaster preparedness, relief, recovery, and mitigation. These include the Department of Housing and Urban Development, the Small Business Administration, U.S. Department of Agriculture, U.S. Army Corps of Engineers, and the Department of Health and Human Services. While FEMA may fund some of their activities out of the DRF through mission assignments,⁵ their broader disaster-related programs are funded through separate appropriations.⁶

What federal government activities are funded under the DRF?

The role of the federal government has evolved over the years, as described in the sections below, but emergency response and disaster relief has historically been a federalized "bottom-up" operation, starting from the local or tribal governments affected, backed up by the state or territorial government,⁷ and then turning to the federal government if capacity becomes overwhelmed. The broadening of the federal role has been a factor in which activities are funded under the DRF.

Currently, the Federal Emergency Management Agency (FEMA) coordinates federal disaster response and recovery efforts. As such, it manages the DRF, which funds activities in five categories:

• 1. Activity pursuant to a major disaster declaration—In recent years, this activity has represented more than 95% of DRF obligations. FEMA's primary "Direct Disaster Programs" are the Individual Assistance (IA),⁸ Public Assistance (PA),⁹ and the Hazard Mitigation Grant Program (HMGP) programs.¹⁰ Federal assistance provided by other federal agencies at FEMA's direction through "mission assignments" is often paid for from the DRF.¹¹
• 2. Predeclaration surge activities—These are activities undertaken prior to an emergency or major disaster declaration to prepare for response and recovery, such as deploying response teams or prepositioning equipment.
• 3. Activity pursuant to an emergency declaration—This is federal assistance to supplement state and local efforts in providing emergency services in any part of the United States.
• 4. Fire Management Assistance Grants (FMAGs) for large wildfires—This is assistance for the mitigation, management, and control of any fires on public or private lands that could, if unchecked, worsen and result in a major disaster declaration.¹²
• 5. Disaster Readiness and Support (DRS) activities—These are ongoing, non-incident-specific activities that allow FEMA to provide timely disaster response, operate its programs responsively and effectively, and provide oversight of its emergency and disaster programs.

Under what statute is the Disaster Relief Fund authorized?

The DRF is not separately authorized as a distinct entity, but the activities it funds are authorized under the Stafford Act (42 U.S.C. 5121 et seq.).

Where are appropriations for the Disaster Relief Fund provided?

Since FY1980—FEMA's first annual appropriation—the DRF has been funded through its own appropriation within FEMA's budget, first under the heading "Disaster Relief," and then "Disaster Relief Fund" starting in FY2012. FEMA's annual appropriations were first provided through the VA, HUD, and Independent Agencies Appropriations Act, but have been included in the Department of Homeland Security Appropriations act since FY2004. Since the first "Disaster Relief" appropriation for FY1948, most of the DRF's appropriations have been provided through supplemental appropriations. See "Appropriations for General Disaster Relief" for details.

Are specific Disaster Relief Fund appropriations for specific disasters or programs?

DRF appropriations have historically been provided for general disaster relief, rather than specific presidentially declared disasters or emergencies.

The most recent iterations of the appropriations bill text indicate the funds are provided for the "necessary expenses in carrying out the Robert T. Stafford Disaster Relief and Emergency Assistance Act," thus covering all past and future disaster and emergency declarations.¹³ Previous versions of the appropriations language (going back to 1950) also reference the legislation authorizing general disaster relief rather than targeting specific disasters. On a number of occasions, specific disasters have been mentioned in the appropriation, but funding was not specifically directed to one disaster over others.

While many disaster supplemental appropriations bills are associated with a specific incident or incidents—such as P.L. 113-2, "the Sandy Supplemental"—the language in that act does not limit the use of the DRF appropriation to that specific incident.¹⁴

CRS has identified two exceptions to this practice:

• P.L. 107-117 and P.L. 107-206 provided a total of $8.04 billion in resources to the Disaster Relief Fund, specifically for expenses "to respond to the September 11, 2001, terrorist attacks on the United States."¹⁵
• P.L. 116-260, Division M (the Coronavirus Response and Relief Supplemental Appropriations Act, 2021), included a $2 billion supplemental appropriation for the DRF and specifically provided for COVID-19 disaster-related funeral expenses.

In addition, transfers are made from the DRF from time to time to fund the disaster relief oversight efforts of the DHS Office of Inspector General as well as the Community Disaster Loan program through the Disaster Assistance Direct Loan Program.

How is the DRF being spent today?

Since the enactment of P.L. 112-74, Congress has received regular reporting on spending from the DRF. Monthly reports on such spending since March 2013 are available on FEMA's website.¹⁶ Currently, the reports include information on DRF balances, actual and projected obligations from the DRF for large-scale disasters broken down by disaster declaration, and obligations and expenditures aggregated by incident. These reports also include estimates of the DRF balance through the end of the current fiscal year.

Analysis of some of the data across these monthly DRF reports can show trends in how the DRF has been used for disasters declared since August 1, 2017.

Figure 1. DRF Obligations for Major Disasters, by Program (from Disaster Relief Fund monthly report data, as of January 10, 2024)

Source: CRS analysis of FEMA's Disaster Relief Fund: Monthly Report data from March 2020, October 2023, January 2024. Notes: Pre-COVID data does not reflect deobligations made after February 29, 2020. FY2023 data does not reflect deobligations made after September 30, 2023, or adjustments made by FEMA in fiscal year closeout.

Historical Context for Federal Disaster Relief Funding

Disaster relief has not always been a part of the mission of the federal government. For nearly 80 years, federal domestic disaster relief was minimal, extremely narrow in scope, and largely did not address humanitarian needs, leaving those to private organizations and local levels of government. Even as the country emerged from the Civil War with more of a national identity and a sense that the federal government could act to provide relief in some circumstances, disaster aid remained limited, responding only after the fact on a case-by-case basis. Only after World War II did the concept emerge of a federal role in responding to disasters. This new role was more broadly defined, led by the President and funded in advance, as opposed to case-by-case responses to needs in the wake of the most severe events led by ad hoc congressional action. Over the ensuing years, the general disaster relief program and its funding grew, expanding concepts of assistance once reserved for catastrophic events to address more common natural disasters. In the 1970s, the Federal Emergency Management Agency (FEMA) was established, institutionalizing the federal role in disaster response, recovery, mitigation, and preparedness—the role we recognize today. At the heart of that role is the set of relief programs that have evolved since the 1940s, known collectively as the Stafford Act, which are funded by the Disaster Relief Fund appropriation.

1789-1947: Case by Case, After the Fact

The Constitution provides little specific direction on the question of how the United States should confront disasters. While allusions to the intent of the Constitution speak to promoting domestic tranquility and the general welfare, limitations on the federal role in state affairs combined with the balance of national priorities and federal resources constrained federal involvement in disaster relief and recovery in the early years of the country.

The federal government did provide disaster relief on some occasions. Some observers note at least 128 instances from 1803 to 1947 when natural disasters prompted the federal government to provide some type of ad hoc relief on a case-by-case basis for specific incidents after they occurred.¹⁷ Prior to the Civil War, these measures largely consisted of refunds of duties paid on goods destroyed in customs house fires, allowances for delayed payments of bonds, and land grants for resettlement.¹⁸

Proponents of disaster relief argued that the "general welfare" clause of the Constitution warranted the federal role in disaster relief.¹⁹ Opponents did not find this justification convincing, as it was nonspecific,²⁰ and argued that certain natural disasters (such as flooding of the Mississippi River) were foreseeable, and therefore state and local governments had an obligation to be prepared.²¹ They also contended that it was improper for the government to provide relief for specific places with money it collected for the common good;²² and that the federal government could not afford to provide universal relief. As the U.S. economy became more robust, federal revenues grew, weakening the position of those in Congress who opposed a federal role in disaster assistance on the basis of the lack of such resources.

Congressional willingness to provide assistance was not always sufficient to ensure its provision, however. In 1887, President Grover Cleveland vetoed a bill that would have provided $10,000 to pay for seeds for farmers in Texas after a drought, arguing as follows:

I can find no warrant for such an appropriation in the Constitution; and I do not believe that the power and duty of the General Government ought to be extended to the relief of individual suffering which is in no manner properly related to the public service or benefit. A prevalent tendency to disregard the limited mission of this power and duty should, I think, be steadfastly resisted, to the end that the lesson should be constantly enforced that though the people support the Government, the Government should not support the people.

The friendliness and charity of our countrymen can always be relied upon to relieve their fellow-citizens in misfortune. This has been repeatedly and quite lately demonstrated. Federal aid in such cases encourages the expectation of paternal care on the part of the Government and weakens the sturdiness of our national character, while it prevents the indulgence among our people of that kindly sentiment and conduct which strengthens the bonds of a common brotherhood.²³

Much of the disaster relief provided in this period was nongovernmental in nature. In 1881, Clara Barton founded the American National Red Cross (ANRC),²⁴ which provided disaster aid from funds it raised from private sources. One year before a catastrophic earthquake struck San Francisco in 1906, the incorporating legislation for the ANRC was revised to task the organization with "mitigating the sufferings caused by pestilence, famine, fire, floods, and other great national calamities, and to devise and carry on measures for preventing the same."²⁵ In the days after the earthquake, President Theodore Roosevelt issued an appeal for assistance from the public for the ANRC's relief efforts:

In the face of so horrible and appalling a national calamity as that which has befallen San Francisco, the outpouring of the nation's aid should, as far as possible, be entrusted to the American Red Cross, the national organization best fitted to undertake such relief work.... In order that this work may be well systematized and in order that the contributions, which I am sure will flow in with lavish generosity, may be wisely administered, I appeal to the people of the United States, to all cities, chambers of commerce, boards of trade, relief committees and individuals to express their sympathy and render their aid by contributions to the American Red Cross.²⁶

While the federal government provided ad hoc response and recovery assistance to San Francisco, the majority of the aid was provided through private means. Congress appropriated $2.5 million in the days after the quake to the Secretary of War to provide "subsistence and quartermaster's supplies ... to such destitute persons as have been rendered homeless or are in needy circumstances as a result of the earthquake and commissary stores to such injured and destitute persons as may require assistance,"²⁷ but nonfederal cash contributions to the ANRC and the local relief organizations exceeded $9 million in the two years following the disaster.²⁸

The ANRC served as the major institutional source of relief for disaster victims in the United States, serving communities and individuals in cooperation with state and local governments with relatively little direct contribution from the federal government for many years. The Red Cross continued to play a leading role in nongovernmental disaster relief as the federal government's role in disaster aid evolved and expanded through the 20^th century and into the 21^st.

1947-1950: General Disaster Relief Funding from the Federal Government Begins

After the Second World War, the federal government started becoming more involved in disaster relief beyond specific incident-by-incident relief efforts. In 1947, P.L. 80-233 authorized the federal government to provide surplus property to state and local governments for disaster relief under the Disaster Surplus Property Program. Less than eight months later, the Administrator of the Federal Works Agency noted in a letter to President Harry S. Truman that the program would not provide adequate relief to communities over the longer term.²⁹

The next year, Congress made its first appropriation for general disaster relief. The Second Deficiency Appropriation Act, 1948,³⁰ which was enacted on June 25, 1948, provided funding directly to the President as follows:

DISASTER RELIEF

Disaster Relief: To enable the President, through such agency or agencies as he may designate, and in such manner as he shall determine, to supplement the efforts and available resources of State and local governments or other agencies, whenever he finds that any flood, fire, hurricane, earthquake, or other catastrophe in any part of the United States is of sufficient severity and magnitude to warrant emergency assistance by the Federal Government in alleviating hardship, or suffering caused thereby, and if the governor of any State in which such catastrophe shall occur shall certify that such assistance is required, $500,000, to remain available until June 30, 1949, and to be expended without regard to such provisions regulating the expenditure of Government funds or the employment of persons in the Government service as he shall specify: Provided, That no expenditures shall be made with respect to any such catastrophe in any State until the governor of such State shall have entered into an agreement with such agency of the Government as the President may designate giving assurance of expenditure of a reasonable amount of the funds of the government of such State, local governments therein, or other agencies, for the same or similar purposes with respect to such catastrophe: Provided further, That no part of this appropriation shall be expended for departmental personal services: Provided further, That no part of this appropriation shall be expended for permanent construction: Provided further, That within any affected area Federal agencies are authorized to participate in any such emergency assistance.³¹

Although this legislation came with broad latitude for the President in expending these funds, this appropriation contained several hallmarks that continue in today's disaster relief structure:

• the President makes the determination that a disaster has occurred, and that federal aid is required;
• the state has a role in certifying the need and committing state resources to be eligible for federal support;
• aid is to "supplement the efforts and available resources of State and local governments or other agencies," rather than to fund the entire relief effort; and
• the President may direct federal agencies to participate in emergency assistance.

The conditions laid out in this appropriation were echoed in the next two appropriations, provided in 1949, which totaled $1 million.³²

1950-1966: The Disaster Relief Act of 1950—General Relief and Specific Relief

The Disaster Relief Act of 1950 formalized the structure outlined in the initial appropriations legislation, and indicated for the first time that

it is the intent of Congress to provide an orderly and continuing means of assistance by the Federal Government to States and local governments in carrying out their responsibilities to alleviate suffering and damage resulting from major disasters, to repair essential public facilities in major disasters, and to foster the development of such State and local organizations and plans to cope with major disasters as may be necessary.³³

Section 8 of the act limited the authorized disaster relief funding to $5 million in total.³⁴ This restriction did not effectively constrain funding, however. The first supplemental appropriation for general disaster relief authorized under the Disaster Relief Act for 1950 provided $25 million, and a waiver of the Section 8 limitation.³⁵ The first authorized annual appropriation for general disaster relief was for $800,000, enacted August 31, 1951, less than two months later.³⁶ Annual appropriations were "to be available until expended," rather than expiring as previous general disaster relief appropriations had, and their use for administrative expenses was statutorily capped at 2% per year.³⁷

Under the Kennedy and Johnson Administrations, the federal government's role in disaster relief expanded further.³⁸ Federal general disaster relief programs broadened in 1962, with the inclusion of several American territories, and provision of grants for repair of state facilities.³⁹

However, Congress still passed specific legislation authorizing relief programs pursuant to other major disasters. In 1964 and 1965, post-disaster legislation provided specific relief for victims of an earthquake in Alaska,⁴⁰ flooding in western states,⁴¹ and Hurricane Betsy in Florida, Louisiana, and Mississippi.⁴² In a history of disaster relief legislation, one observer described the situation thus:

In 1962, 1964, and 1965, Congress had sought to preserve P.L. 81-875 [the Disaster Relief Act of 1950] and yet provide disaster assistance in the case of the very big disasters by special legislation only for the states named. Although no one at the time appeared aware that the new types of assistance would become precedents for general legislation, it was in the nature of the system that ultimately they would be reenacted for general use.⁴³

1966-1974: The Disaster Relief Act of 1966—General Relief Broadens

The Disaster Relief Act of 1966⁴⁴ revised the general disaster assistance program by providing more assistance to public colleges and universities, as well as authorizing assistance to repair local public facilities.⁴⁵ The Disaster Relief Act of 1969⁴⁶ was enacted in response to Hurricane Camille, although the expansion of the federal role in disaster assistance it formalized had been included in legislation since 1965. It included broader public and individual assistance, including temporary housing, food assistance, unemployment assistance, matching funds to help states develop preparedness plans, and authorization for the federal government to fund up to half the cost of repair and restoration of public facilities.⁴⁷ Not all of these costs would be borne by the funding provided to the President, and the programs were only authorized through calendar 1970, but they represented a significant broadening of federal government involvement.

The Disaster Relief Act of 1970⁴⁸ consolidated the previous disaster relief legislation into a single act, and made many of the Camille-driven programs permanent, including programs to provide temporary housing assistance, debris removal, and permanent repair and replacement of state and local public facilities.

1974-2017: The Era of Federally Coordinated Emergency Management

The Disaster Relief Act of 1974⁴⁹ provided for a more robust preparedness program, and introduced the concept of "emergency" declarations to accommodate assistance in cases where an incident did not rise to the "major disaster" threshold.⁵⁰

The Disaster Relief and Emergency Assistance Amendments of 1988 (P.L. 100-707, hereinafter DREAA) renamed the Disaster Relief Act of 1974 as the Robert T. Stafford Disaster Relief and Emergency Assistance Act (the aforementioned Stafford Act).⁵¹ It made the following programmatic changes:

• Authorized the President to declare an emergency under the Stafford Act in "any occasion or instance" in which federal aid is needed—allowing for assistance without a major disaster declaration;⁵²
• Defined a "major disaster" as "any natural catastrophe ... or, regardless of cause, any fire, flood, or explosion, in any part of the United States, which in the determination of the President causes damage of sufficient severity and magnitude to warrant major disaster assistance.... "⁵³
• Established a 75% minimum level of assistance for the immediate response, debris removal, and repair of public facilities; and
• Provided for a 50/50 cost share for hazard mitigation grants.⁵⁴

The Stafford Act and the DREAA are the pieces of legislation that structure the current relationship between the federal and state government in emergency management and disaster relief. These laws, which appear at 42 U.S.C. 5121 et seq., continue to be amended, with reform legislation frequently following on the heels of exceptionally large disasters, or complexes of disasters. Two major reform bills were enacted since FEMA was incorporated into DHS in 2003:

• 1. The Post Katrina Emergency Reform Act of 2006 (PKEMRA)⁵⁵—Enacted as a sixth title to the FY2007 DHS Appropriations Act, PKREMRA reauthorized and restructured FEMA, and made amendments to the Stafford Act, including allowing federal assistance to be provided in the absence of a specific request, improved assistance for individuals with disabilities, and expanded availability of public assistance to nongovernmental organizations.
• 2. The Sandy Recovery Improvement Act (SRIA)⁵⁶—Enacted as a part of the FY2013 supplemental appropriations act, SRIA included alternative procedures for the Stafford Act Public Assistance program to allow disaster impacted area to get assistance on the basis of cost estimates rather than reimbursement of costs, among other reforms.

2017-Present: The Disaster Recovery Reform Act and Catastrophic Disasters

The current era of disaster relief begins with a series of catastrophic disasters⁵⁷ in 2017. Wildfires in California as well as Hurricanes Harvey, Irma, and Maria led to a series of large supplemental appropriations for disasters, including two for the DRF. The following year, the Disaster Recovery Reform Act of 2018 (DRRA)⁵⁸ was enacted through an FAA reauthorization measure. DRRA had provisions to broaden federal investments from the DRF into mitigation efforts that protect public infrastructure, as well as making changes to the Stafford Act's Public Assistance and Individual Assistance programs.⁵⁹

In addition to more frequent "traditional" catastrophic disasters, major disaster assistance programs under the Stafford Act were used for the first time in the context of an infectious disease outbreak during the COVID-19 pandemic.⁶⁰ On March 13, 2020, President Donald J. Trump made a series of emergency declarations under Section 501(b) of the Stafford Act in response to the nationwide spread of a novel coronavirus disease (COVID-19).⁶¹ The declarations authorized assistance to all U.S. states, territories, tribes, and the District of Columbia. At the time he announced the declarations, he invited the recipients of those declarations to request major disaster declarations.⁶² FEMA notes that 50 states, five territories, the District of Columbia, and three tribes all requested and received major disaster declarations for COVID-19 response.⁶³ For more information on the various applications of Stafford Act authorities pursuant to this incident, see CRS Report R47048, FEMA's Role in the COVID-19 Federal Pandemic Response.

Remarks from the passage of the Stafford Act seem to indicate that such applications may not have been what the architects of the measure envisioned. While not explicitly excluding the use of the major disaster declaration for infectious disease, Representative Arlen Stangeland (R-MN), the ranking member of the Subcommittee on Water Resources of the House Public Works and Transportation Committee, noted in his comments on the final version of the bill that other authorities existed for public health matters:

Title I reorganizes the disaster relief program to clearly define Presidential authority to respond to major disasters and emergencies. Major disasters would include primarily natural catastrophes or, in certain instances, nonnatural catastrophes while emergencies would include any occasion or instance in which Federal assistance was necessary. However, we do not intend for emergency declarations to be available in responding to public health problems such as disease epidemics or environmental or nuclear catastrophes for which Federal assistance is already available....

In March, 2021, the American Rescue Plan Act (P.L. 117-2; ARPA) was signed into law. Included in Section 4005 was a $50 billion mandatory appropriation for the Disaster Relief Fund, the first mandatory budget authority ever provided to that account.

Appropriations for General Disaster Relief

Types of Appropriations for Disaster Relief

General disaster relief activities by the federal government under the Stafford Act are funded through the appropriations process. Three types of appropriations support these activities:

Supplemental Appropriations: Requested by the Administration on an ad hoc basis, generally to address a need not sufficiently covered in the annual appropriations process. These move on a short timetable and generally do not go through the complete committee process.

Annual Appropriations: Requested by the Administration in February as a part of the annual budget process, these are expected to be passed by Congress and enacted into law prior to the start of the fiscal year in October. Annual appropriations measures fund the core activities of the government and are developed through the committee process.

Continuing Appropriations: Provided when annual appropriations work remains unresolved at the beginning of the new fiscal year, these appropriations are temporary budget authority provided at a rate for operations based on the prior fiscal year to allow the government to continue functioning. The measure that provides them is termed a "continuing resolution," or "CR." These continuing appropriations may expire (in the case of an interim CR), or extend to the end of the fiscal year (in the case of a "long-term" CR).

Supplemental Appropriations for Disaster Relief

The current Disaster Relief Fund concept can trace its birth back to an appropriations bill in the 1940s—the Second Deficiency Appropriations Act, 1948.⁶⁴ Deficiency appropriations bills, which provided funding to meet unanticipated needs during the fiscal year, were a forerunner of modern supplemental appropriations bills. The severity, frequency, and resultant costs to the federal government from the array of disasters that strike the United States have always been unpredictable in an annual budgetary context. To respond to this uncertainty, disaster relief funding frequently has been provided through deficiency, and later supplemental, appropriations.

When Congress and the Administration began to express concerns about the budget deficit in the 1980s, efforts were made to restrain supplemental spending by limiting it to cases of "dire emergency." With the implementation of budget control in the 1990s, a special designation for emergency spending was created. If both Congress and the Administration agreed that certain spending was an emergency requirement, budget limits would be adjusted to accommodate that spending. Congress used the emergency designation on a disaster relief appropriation for the first time in an FY1992 supplemental appropriations act.⁶⁵ Congress continues to use emergency designations in supplemental appropriations legislation to provide budgetary flexibility.

At one point, Congress was statutorily required to use the emergency designation for disaster relief appropriations. Under the terms of the aforementioned FY1992 supplemental appropriations act, beginning in FY1993, Congress required "all amounts appropriated for disaster assistance payments [under the Stafford Act] that are in excess of either the historical annual average obligation of $320,000,000, or the amount submitted in the President's initial budget request, whichever is lower" be designated as emergency requirements under a specific provision of the Balanced Budget and Emergency Deficit Control Act of 1985.⁶⁶ This practice of emergency designation above a particular threshold was followed until FY2000, when a clause appeared in the appropriation noting that discretionary appropriations were being provided notwithstanding the restrictions of this section of the U.S. Code.⁶⁷

Before the implementation of special budgetary treatment specifically for disaster relief in the FY2013 annual appropriations cycle, 86.1% of appropriations for the DRF were provided through supplemental appropriations. See "Calculation of the Annual Appropriations Request" for a discussion of why supplemental appropriations are central to ensuring adequate funding for the DRF.

Annual Appropriations

The first general disaster relief funding was provided in an annual appropriations act in 1948, and carried its own authorizing provisions. Stand-alone authorization for general disaster relief first came in 1950.

Once the initial separate authorization was put in place for general disaster relief, appropriations were provided for FY1952, FY1956-FY1958, and FY1962. As noted above, with the development, codification, and expansion of the federal role in emergency management, appropriations for general disaster relief became more common—and larger. Annual appropriations for general disaster relief have been provided each year since FY1964, with only two exceptions.⁶⁸

Disaster Relief Designation

The adoption of a special designation for the costs of major disasters under the Stafford Act as a part of the Budget Control Act of 2011 (P.L. 112-25, BCA) reduced the DRF's reliance on supplemental appropriations, and changed its structure.

More Annual Appropriations:

Establishment in the BCA of a specific budget exception for disaster relief linked to the Stafford Act that was distinct from the broader exception for "emergency requirements" made it easier to provide budget authority to the DRF in the annual appropriations process.⁶⁹ FY2013 was the first year this mechanism was used over the course of the whole annual appropriations process. Controlling for inflation, in the first six years of the disaster relief adjustment the DRF received more annual appropriations than it had during its entire pre-BCA existence going back to 1948. Since the implementation of the disaster relief adjustment in the annual appropriations process, the percentage of DRF appropriations provided through annual appropriations has risen from less than 14% to more than 41%.

The FY2023 annual appropriation for the DRF of $19.945 billion was its largest annual appropriation ever, breaking the previous record of $18.799 billion set by the FY2022 annual appropriation.

Changes in DRF Account Structure:

As the new mechanism required identifying resources within the DRF that were specifically for major disasters, since the FY2013 annual appropriations request, FEMA has bifurcated the DRF request between the costs of major disasters—the "Disaster Relief Category"—and everything else funded by the DRF—"Base Disaster Relief," which includes funding for emergency designations, fire management assistance, pre-disaster declaration surge activities, and Disaster Readiness and Support Programs. The former category is eligible for the BCA designation as "disaster relief," while the latter category is not, and usually scores against discretionary spending limits.

The allowable adjustment for disaster relief expired at the end of FY2021. According to OMB, it had covered $104 billion in major disaster costs through FY2021.⁷⁰ Over the life of the BCA, 93% of covered appropriations went to the DRF.

In its FY2022 budget request, the Biden Administration proposed extending special budgetary treatment for disaster relief. Subsequently, the FY2022 budget resolution included an adjustment for disaster relief that continued effectively to exempt such funding from spending limits within the congressional budget process.⁷¹ When Congress reestablished statutory limits on discretionary spending for FY2024 and FY2025, it also restored the disaster relief adjustment.⁷²

Continuing Appropriations

Even though the DRF is a "no-year" fund, and its appropriations are available until expended, it does get temporary replenishment from continuing resolutions (CRs) at times, until its annual appropriations are finalized.⁷³

In FY1982, for the first time, interim general disaster relief funding was provided in a CR through an "anomaly," a provision providing funds at an operating rate different from that base rate of operations provided in the resolution.⁷⁴

These "anomaly" provisions may also provide flexibility that can help avoid some of the complications that can arise under the constraints of operating under continuing appropriations. For example, CRs generally provide funding at a constant rate of operations, with certain restrictions. This can complicate disaster response and recovery, when calls for funding vary in scale and timing from year to year. The DRF could, in some circumstances, risk being depleted by response and recovery needs while operating under a CR. This risk can be addressed in one of two ways: responsively, when FEMA requests special flexibility from the Office of Management and Budget (OMB)—which apportions CR funding to agencies; or proactively, when a special provision is included in the CR that directs such flexibility be provided to ensure adequate resources are available. Such language can be found in CRs since FY2018, which all provide that the funds provided "may be apportioned up to the rate for operations necessary to carry out response and recovery activities" under the Stafford Act.⁷⁵

DRF Funding History

The following figures show appropriations for the DRF from FY1964 through FY2023.

Each fiscal year shows a gross total of annual appropriations and discretionary appropriations (represented by a two-part bar) and a net total (represented by a black mark on each bar), which takes into account rescissions and transfers from the DRF. An inset graphic provides the scale to include funding levels for several outlier years,⁷⁷ while showing the detail of appropriations for the more typical years. The first figure shows data in nominal dollars, and the second shows constant FY2023 dollars.

The figures show an increase in appropriations for the DRF starting in the 1990s, largely due to increases in supplemental appropriations. Annual appropriations rose significantly in the early 2000s and again starting in FY2013. FY2021 saw the DRF receive its largest gross appropriations in its history, in nominal dollars, due to the $50 billion in mandatory supplemental funding provided in the American Rescue Plan Act. However, when inflation is taken into account, FY2005 remains the single highest year for appropriations for the DRF, when a series of hurricanes, including Katrina, Rita, and Wilma hit the southeastern United States.⁷⁸

A table showing the underlying data for each figure appears in the Appendix.

Figure 2. Nominal Dollar Disaster Relief Appropriations, FY1964-FY2023

Source: CRS analysis of appropriations laws. Notes: Totals for FY2005, FY2006, FY2018, FY2020, FY2021, and FY2023, referenced by the arrows, are beyond the scale of the main graph and are shown on the inset. FY2013 numbers do not reflect the impact of sequestration. Supplemental data include contingent appropriations and all appropriations under the heading of "Disaster Relief" or "Disaster Relief Fund" including the language "for an additional amount." Reductions reflected in the Net Total data include transfers and rescissions specifically enumerated in appropriations acts. For information on trends in the declarations that helped drive the demand for these appropriations, see CRS Report R42702, Stafford Act Declarations 1953-2016: Trends, Analyses, and Implications for Congress, by Bruce R. Lindsay.

Figure 3. FY2021 Dollar Disaster Relief Appropriations, FY1964-FY2023

Source: CRS analysis of appropriations laws. Notes: Totals for FY2005, FY2006, FY2018, FY2020, FY2021, and FY2023, referenced by the arrows, are beyond the scale of the main graph and are shown on the inset. FY2013 numbers do not reflect the impact of sequestration. Supplemental data include contingent appropriations and all appropriations under the heading of "Disaster Relief" or "Disaster Relief Fund" including the language "for an additional amount." Reductions reflected in the Net Total data include transfers and rescissions specifically enumerated in appropriations acts. For information on trends in the declarations that helped drive the demand for these appropriations, see CRS Report R42702, Stafford Act Declarations 1953-2016: Trends, Analyses, and Implications for Congress, by Bruce R. Lindsay.

Factors in Changing Appropriations Levels

For years, FEMA's budget justifications have noted, in one form or another, that "[t]he primary cost driver associated with Major Disasters is disaster activity."⁷⁹ While year-to-year disaster relief appropriations are largely driven by disaster activity and ongoing recovery needs, when analyzing historical data over an extended time frame, other factors such as programmatic changes in general disaster relief and certain changes in the budget process may also warrant consideration.

Incident Frequency and Severity

The two largest factors affecting year-to-year disaster relief appropriations are disaster activity, which varies in frequency and severity, and the ongoing recovery costs from previous disasters. Federal involvement in disaster response and recovery occurs when lower levels of government find their capabilities are overwhelmed and turn to the federal government for help. Reduced (or increased) numbers of calls for relief mean reduced (or increased) need for disaster relief appropriations.

The incidents that lead to expenditures from the DRF vary in scale. Equally powerful storms may strike a community with a glancing blow or a direct hit. An earthquake may strike a rural area, or a major city with complex infrastructure. Stricken communities, states, territories, and tribes have varying levels of preparedness for particular types of disaster, and different amounts of public infrastructure to repair and replace.

Some observers have noted that as the U.S. population grows and develops property in disaster-prone areas, and as patterns of severe weather shift, the costs of disasters are likely to continue to rise.⁸⁰ According to the National Centers for Environmental Information of the National Oceanic and Atmospheric Administration, from 1980 through 2023, the United States has averaged more than eight weather-related disaster events that each cost $1 billion or more each year.⁸¹ The frequency of these events is increasing. From 1980 through 2007, more than seven billion-dollar events occurred in only one year (1998). Since 2007, these events have become more frequent: only one year since 2007 has seen fewer than seven such events. Ten or more such events have occurred each year since 2011. The average over the last five years (2019-2023) is more than 20 billion-dollar events. The United States was struck by 28 such events in 2023, exceeding the previous annual record set in 2020 of 22 events.⁸²

The contrast in funding for the DRF between the period of high-frequency, high-impact events from FY2012 to the present day and the relatively calm period of the 1980s is illustrated in Figure 3. Without the driver of large disasters, DRF appropriations remained modest. During the period from FY1981 to FY1991, unusually low levels of disaster activity led to no supplemental appropriations for 7 of those 11 fiscal years, and no annual appropriations in either FY1984 or FY1991—the only two fiscal years for which this has occurred since FY1964. By contrast, over the last seven years, the DRF has required sustained high levels of appropriations. Total nominal dollar appropriations for the DRF for each year never went below $12 billion. Even adjusting for inflation, all seven fiscal years were among the 11 highest years of funding for the DRF, and four were within the top five. The top four years of outlays from the DRF all occurred over the four-year period of FY2020 through FY2023.

Figure 4 shows the relationship between billion-dollar events and catastrophic incidents—those that cost the DRF more than $500 million each. Note that not all of the billion-dollar loss events resulted in more than $500 million in expenditures from the DRF. The most expensive of the catastrophic events—pandemic COVID-19—is not included in NOAA's billion-dollar event accounting, as it is not weather-related. The right axis shows annual obligations from the DRF, to illuminate the effect of these events on DRF obligations. Given its unprecedented nature and high cost, white dots with green borders show DRF obligations for non-COVID events.

Figure 4. Number of $1 Billion Loss Events and Catastrophic Incidents, FY2014-FY2023, with DRF Obligations, Controlling for COVID-19 Obligations

Source: CRS analysis of NOAA billion-dollar events research and DRF monthly reports. Notes: All events tallied by fiscal year. Amounts are not indexed for inflation. DRF obligations data does not reflect the year-end closeout adjustments performed in the month after the fiscal year is complete; however, these amounts are not large enough to be reflected in the Figure. Total obligations do not reflect set-asides or obligations associated with the Building Resilient Infrastructure and Communities program. Deobligations of funding, rescissions, and transfers are not reflected.

Figure 4 nevertheless shows the increasing trend in the number of billion-dollar loss events over the last 10 years, and an increasing number of half-billion DRF cost events. It also shows, as expected due to the significance of recovery costs from large events, that relief most often comes in the form of reimbursements after the fact. However, the level of obligations from the DRF has more to do with the relative severity of the event, as opposed to the number of events, as the severity of the COVID-19 response shows.

Further analysis of the 10 most recent fiscal years reinforces the association between catastrophic incidents and the level of appropriations for and obligations from the DRF. Figure 5 shows the level of appropriations for the DRF for each of the last 10 fiscal years, followed by two columns showing total DRF obligations and DRF obligations for catastrophic disasters.

Figure 5. DRF Appropriations and Obligations, FY2014-FY2023 (Reflecting the comparative size of obligations for catastrophic events)

Source: CRS analysis of fiscal year-ending Disaster Relief Fund: Monthly Reports from FEMA, FY2014-FY2023, Appendices A and B. Notes: Data does not reflect the year-end closeout adjustments performed in the month after the fiscal year is complete. However, these amounts are not large enough to be reflected in the figure. Total obligations do not reflect set-asides or obligations associated with the Building Resilient Infrastructure and Communities program. Deobligations of funding, rescissions, and transfers also are not reflected. FEMA credits $16 billion in supplemental appropriations for the DRF in the same measure as the FY2024 Continuing Resolution as FY2024 funding, so those funds are not reflected in this figure.

The DRF continues to pay the costs of recovery from catastrophic incidents for years after they occur. For example, in FY2023, FEMA obligated $7.9 billion in DRF funding for ongoing recovery from non-pandemic catastrophic disasters that occurred in FY2020 or earlier, including almost $5.6 billion for Hurricanes Harvey, Irma, Maria, and the 2017 California wildfires, $146 million for Hurricane Sandy (2012), and $267 million for costs from Hurricanes Katrina, Rita, and Wilma (2005).

Programmatic Changes in Disaster Relief

Over the long term, alterations to the scope of federal disaster relief programs affect the type and level of federal spending when disasters occur. Initially, the first appropriation for disaster relief and the Disaster Relief Act of 1950 authorized funding to repair local public facilities at the President's discretion. As the brief history above relates, the federal program for general disaster relief has evolved into a much broader program, of which local public facilities is only one facet.

This evolution has occurred gradually. Some of this evolution was the result of incorporating assistance offered in response to specific disasters in the 1960s and 1970s into the general relief programs under the Stafford Act. Additional changes were brought about by the broadening of the federal role in smaller-scale incidents, as well as proactive declarations prior to potential disasters to reduce their impact. In addition, disaster relief programs funded through the DRF now include disaster mitigation programs that are not limited to mitigating the type of disaster that triggered them, but are also intended to reduce the impact (and by extension, the cost) of disasters over the long term.

The impacts of programmatic expansions are reflected in Figure 3, with the trend of increased general disaster relief appropriations on a small scale associated with expansions under the Disaster Relief Act of 1969 and the Disaster Relief Act of 1970, and on a larger scale with the expansion of programs under the Disaster Relief and Emergency Assistance Amendments of 1988. While the decrease in disaster activities in the 1980s reduced the annual demand for disaster relief appropriations, once the number of declared disasters rose again, and emergencies and mitigation also drew on DRF resources, demand for those resources grew rapidly.

Programmatic broadening in general disaster relief has continued in the 21^st century. It remains to be seen if the novel use of the Stafford Act to support COVID-19 response will become a precedent for future use of the Stafford Act and DRF resources.⁸³

Changes in the Budget Process

Changes in congressional budget processes have at times been discussed as a means of limiting the budgetary impact of disaster relief spending. However, the budget controls that have been approved and implemented generally have been provided with provisions to ensure disaster relief budget authority remains available if needed.

Prior to 1985, Congress provided appropriations to fund the federal government without specific statutory limitations on overall spending. The 1985 Balanced Budget and Emergency Deficit Control Act put limits on deficit spending in place. The Budget Enforcement Act of 1990 placed express limits on discretionary spending for the first time.

The 1990 act also provided an exception to those limits, allowing Congress, together with the President, to declare certain spending to be an emergency requirement, and therefore not subject to those limits. This was used to provide additional appropriations for disaster relief. Although the original set of discretionary limits expired, the emergency spending designation has continued as part of the appropriations process.

In 2011, the Budget Control Act (P.L. 112-25, BCA) not only reestablished statutory spending limits, but also provided a special designation for the costs of major disasters, in addition to the emergency designation.⁸⁴

The impact of these changes in the budget process on disaster relief appropriations appears to be limited to the structure of the total appropriations, rather than the amount. The Congressional Budget Office (CBO) noted that in the 1970s, "about 5%" of supplemental funding was for disasters.⁸⁵ In a report reviewing supplemental appropriations enacted during the 1980s, CBO indicated that number fell to less than 1%.⁸⁶ This can be attributed to the drop in disaster activity discussed above. In a similar report on the 1990s, CBO observed an increase in the use of supplemental appropriations to provide disaster relief, noting the following:

[I]n the 1990s, Presidents Bush and Clinton tended to request—and the Congress tended to provide in regular appropriations—less than what would eventually be spent in those disaster-related accounts. (Some observers say the underfunding was an effort to keep total appropriations under the [budget enforcement] caps.) When a disaster or emergency arose, the Congress enacted supplemental appropriations during the fiscal year, usually at the request of the President. That supplemental funding was designated emergency spending and was therefore not counted under the discretionary spending caps.⁸⁷

Figure 2 and Figure 3 do not show a distinct impact of budget controls on the overall level of disaster spending. However, they do show an increase in the amount of funding provided in annual appropriations versus supplemental appropriations starting in FY2012. The addition of the disaster relief designation under the BCA enabled higher funding levels for disasters in the annual appropriations bills, as disaster relief-designated appropriations did not compete with other appropriations for limited discretionary resources, either within the allocations provided to the subcommittee funding FEMA, or within the overall discretionary spending limit. In the early years of the disaster relief designation, this increased annual funding also reduced the frequency and urgency of supplemental appropriations for the DRF.

However, Congress has provided emergency-designated relief for catastrophic disasters in supplemental appropriations, whether statutory budget controls were in place or not.

Figure 6 shows a 20-year gross funding history for the DRF from FY2004 through FY2023, showing, for each fiscal year, the breakdown between annual and supplemental appropriations, then the breakdown of funding provided within budget limitations (discretionary spending) and beyond budget limitations (disaster relief and emergency designated spending). It shows the pre-BCA usage of the emergency designation to cover supplemental appropriations for the DRF, and the usage of the disaster relief designation to cover increased DRF annual appropriations, beginning in FY2013—the only time that the disaster relief designation was used in a supplemental appropriations measure. The absence of the gross discretionary bar from FY2021 through FY2023 shows the reliance of the DRF "base" on carryover balances from the CARES Act in that period. It also shows the first mandatory supplemental spending for the DRF—$50 billion through the American Rescue Plan Act (P.L. 117-2) in FY2021—which is subject to different controls than discretionary appropriations.

Figure 6. DRF Annual and Supplemental Appropriations Within and Beyond Discretionary Spending Limits, FY2004-FY2023

Source: CRS analysis of DRF appropriations database. Notes: Does not show the impact of transfers or rescissions. FY2013 data does not include the impact of sequestration.

Budgeting Practices for Disaster Relief

Management of Disaster Relief Funds

The responsibility for managing DRF appropriations has shifted among agencies as the general disaster relief function has grown. In March 1951, President Truman initially delegated the authority for directing federal agencies in a disaster to the Housing and Home Finance Administrator at the Department of Housing and Urban Development (HUD);⁸⁸ then in January 1953 the responsibility was shifted to the Federal Civil Defense Administration in the Department of Defense (DOD).⁸⁹ In 1961, the authority was moved within the department to the Office of Civil Defense Mobilization, which had its name changed in 1961 to the Office of Emergency Planning, and changed again in 1968 to the Office of Emergency Preparedness.⁹⁰ It remained with that office until its abolishment in 1973, when disaster relief powers were transferred from DOD back to HUD, where those powers were exercised by the Federal Disaster Assistance Administration (FDAA).⁹¹

Although management responsibilities were vested in various parts of the federal bureaucracy, appropriations for general disaster relief were provided directly to the Executive Office of the President from FY1948 through FY1973. For FY1974, funds were still described as "Funds Appropriated to the President," but they were provided within HUD's appropriations.⁹²

1978: The Creation of the Federal Emergency Management Agency

In 1978, responding to support from state governors for a more cohesive emergency management structure at the federal level, President Jimmy Carter issued Reorganization Plan #3, which created the Federal Emergency Management Agency (FEMA). At the time, disaster relief functions were vested in three agencies: the FDAA (at HUD, managing general federal disaster relief), the Federal Preparedness Agency (FPA—part of the General Services Administration); and the Defense Civil Preparedness Agency (DCPA—part of the Department of Defense). This was the first time that emergency management functions at the national level were expressly centralized into a single federal agency. FEMA had a three-part role:

• Mobilizing federal resources,
• Coordinating federal efforts with state and local governments, and
• Managing the efforts of the public and private sectors in disaster responses.

FY1980 was the first year appropriations for "Disaster Relief" were provided to FEMA.

Calculation of the Annual Appropriations Request

A review of selected FEMA budget justifications shows how the executive branch has discussed its decision concerning how much to request for disaster relief.

"Past Experience" and Various Averages

In the early 1980s (1983-1985), FEMA provided justifications for the Disaster Relief appropriation that included management and coordination, individual assistance, and public assistance activities. These activities were also supported under the Emergency Management Planning and Assistance appropriation and the Salaries and Expenses appropriation for FEMA. These justifications noted that actual disaster relief requirements were based on unpredictable external factors. The FY1984 justification noted, "The budget requests mentioned are based on average projection of disaster occurrence. Any significant change from the projected totals, through either more or larger size incidents, could generate an increased request."⁹³

However, despite that uncertainty, a request for a specific budget number leads to questions about the basis for that particular number. In the FY1986 process, FEMA explicitly noted it was projecting its anticipated need "on the basis of past experience with disasters."⁹⁴ Between September 1984, when FEMA submitted its budget request to the Office of Management and Budget for review, and February 1985, when the budget justification was provided to Congress, additional "experience" was apparently accumulated that reduced the projected demand for disaster relief from $350 million to $275 million.⁹⁵

By the FY1989 appropriations cycle, the language justifying the request had evolved into "an assessment of historical averages," and included specific data on the average annual disaster relief obligations for a seven-year period,⁹⁶ as well as the disaster relief obligations for the most recently concluded fiscal year. The budget justification then included a request, noting the request and the projected obligation data that justified it included $30 million in savings through unspecified "legislative and administrative reforms."⁹⁷

As has been noted before, by the late 1980s and into the 1990s, concerns about deficit spending led to the discussion of budget controls, and ultimately their implementation.

The FY1992 request highlighted the difficulty in simply using averages of past obligations. According to the justification, the average annual obligation from 1981 to 1989 of $270 million was exceeded by the FY1990 obligation of over $2 billion for costs related to Hurricane Hugo⁹⁸ and the Loma Prieta earthquake.⁹⁹

The FY1994 request included a great deal of information on prior-year activities, discussing these elements in the context of average levels of obligations, and noting the impact of larger disasters in prior years, but did little to specifically justify the request level of $292 million.¹⁰⁰

Five-Year Averages (With Exceptions)

For FY1995, the budget discussion evolved, as FEMA justified the request on the basis of the first five years of activities under the Stafford Act, and the series of major disasters that had struck.¹⁰¹ The use of the five-year average continued through the 1990s and early 2000s, with disaster support costs—the costs of maintaining disaster response capabilities that are not attributable to a specific disaster—included as well. Certain very large disasters were not included in the average. For example, for FY1999, FEMA explicitly excluded the costs of the 1994 Northridge earthquake, plus disaster support costs.¹⁰² For FY2003, not only were the ongoing recovery costs from Northridge excluded from the average, but so were the impacts of the 9/11 terrorist attacks.

By FY2009, the justification had again evolved: "Coupled with funding from recoveries of prior year obligations and unobligated funds carried forward, the appropriation request will fund the five-year average obligation level for direct disaster activity (excluding extraordinary events, such as the terrorist attack of September 11, 2001, the 2004 hurricanes in Florida and other states, and Hurricanes Katrina, Rita, and Wilma in 2005 and 2006 and excluding disaster readiness and support functions)."¹⁰³ In FY2011, the Administration simplified the request language by referring to disasters that cost less than $500 million as "non-catastrophic disaster activity." That year, in addition to the request for the DRF based on the five-year average of "non-catastrophic" disaster relief obligations, the Administration made a concurrent request for $3.6 billion for the costs of prior catastrophic storms and wildfires.

The Budget Control Act Era: Ten-Year Averages, Reserves, and Flexibility

The 2010s saw continued debate on deficit spending, coupled with a continuing desire to fund disaster relief programs. When Congress passed the Budget Control Act of 2011 (P.L. 112-25; BCA), it created statutory caps on spending as well as a special mechanism to exempt some of the costs of major disasters from those caps. (See "Changes in the Budget Process" for details.)

A $500 million reserve fund was included in the Administration's budget request for FY2012. This was intended to help ensure resources were available on short notice in hurricane season.¹⁰⁴ This rose to $1 billion in FY2015. For FY2019, the reserve request increased to $2 billion "due to the uncertainty around the availability of additional supplemental funding to continue addressing the 2017 hurricanes."¹⁰⁵

In FY2013, FEMA shifted from using a 5-year average to using a 10-year average of non-catastrophic obligations, plus the estimated requirements for past major disasters, plus the reserve, as the basis for their overall DRF request.¹⁰⁶

In FY2020, FEMA began to request funding for a statutorily established set-aside for the Building Resilient Infrastructure and Communities program mitigation program outlined in P.L. 115-254, §1234.¹⁰⁷ The set-aside amount is equal to 6% of the estimated aggregate amount of eight types of assistance required for each major disaster. The law, as it requires there to be no reduction in those grants as a result of the set-aside, implies the need for additional funding in the DRF appropriation.¹⁰⁸

The Post-BCA Era: Current Practices

As noted in the "Disaster Relief Designation" subsection above, the statutory discretionary spending limits of the BCA and the disaster relief allowable adjustment expired at the end of FY2021. Since then, the Administration has requested, and Congress has continued to provide a similar adjustment within the budget process, both in FY2022 without statutory limits, and under the budget agreement that set discretionary budget limitations for FY2024 and FY2025.

The methodology for calculating the DRF request has remained consistent since FY2013:

• To calculate the anticipated need for the DRF base, the annual budget request relies on the 10-year historical average of the costs of emergency declarations, Fire Management Assistance Grants, and pre-disaster surge activities, plus spend plan information for Disaster Readiness and Support Activities. Within those amounts, FEMA projects pay costs based on a five-year historical average.¹⁰⁹
• For the costs of major disasters, the annual budget request relies on the 10-year historical average of the costs of major disasters costing less than $500 million each, plus the planned spending for past catastrophic disasters. Within those amounts, FEMA projects pay costs based on a five-year historical average.
• In addition, the DRF request for major disasters has continued to a $2 billion reserve for initial operations in response to significant events, and funding the set-aside for the BRIC program.¹¹⁰
• These amounts are offset by projected unobligated budget authority carried over from the prior fiscal year and deobligations of previously awarded disaster relief budget authority that is no longer eligible for use due to changes in project parameters.

Known Limitations to this Calculation

Given the structure of the budget process, the federal role in disaster response and recovery, and the realities of major disasters as events of limited predictability and highly variable expense, developing an annual budget request that is authoritatively reflective of future requirements is a virtual impossibility. FEMA notes several limitations of the current methodology in its annual statement of its DRF funding requirements:

• Leaving out new catastrophic disasters, beyond the reserve for new significant event response, as FEMA points out, means the Administration will need to seek supplemental appropriations in the event of almost any catastrophic event. Not only are the costs of new catastrophic disasters not reflected in the budget request for the coming fiscal year, that request does not include the cost of catastrophic disasters that occur in the fiscal year during which the request is being considered. These omissions are the largest driver in shortfalls in the major disasters subaccount of the DRF.
• The practical inability of the request to reflect disaster activity in the fiscal year when it is under consideration—activity that will affect the size of carryover balances and recoveries that may be relied on in the request—means the request is almost certain to mismatch with the actual need. One aspect of this is that the delay of obligations from one project into the next fiscal year may help mitigate a shortfall in one year, only to exacerbate one in the next.
• For existing catastrophic disasters, the request for a given fiscal year is based on cost estimates. It is then matched up with projections based on spend plans, which are more reflective of projected needs, as they just reflect the obligation plans for the current year. Even these spending plans shift, which can result in monthly fluctuations of projected end-of-year balances and potential shortfalls, resulting in uncertainty about the required level of supplemental appropriations.

Predicting future events, especially ones as out-of-the-ordinary as disasters, presents a real challenge. This is compounded by the rising potential costs of the catastrophic events that drive most of the spending from the DRF. Without an agreed-upon model to project those costs in the budgeting process, even if these events become more rare, the DRF by necessity will continue to rely on supplemental appropriations to meet disaster funding requirements.

When the DRF Runs Low

At times, the balance in the DRF has dropped to a point that raises concern about its ability to address current and/or impending incidents. When this occurs, FEMA implements "Immediate Needs Funding" (INF) restrictions, which allow FEMA to prioritize, to an extent, obligation of funds from the DRF, limiting them to "life-safety and life sustaining efforts."

This restriction is made through FEMA guidance documents, rather than regulations. INF restrictions were put into place seven out of the nine years from FY2003 through FY2011. After management changes (see "If the DRF Runs Out of Money" below), INF restrictions were not implemented again until FY2017, when a series of major hurricanes, including Hurricane Maria, and wildfires were poised to draw heavily on DRF resources.

The most recent implementation of INF restrictions was on August 29, 2023. FEMA initiated immediate needs funding as the unobligated balance in the DRF dropped to $3.4 billion in the middle of responses to multiple major disasters.¹¹¹ FEMA lifted the restriction on October 2, 2023, after enactment of a continuing resolution¹¹² that provided up to $19.95 billion in temporary budget authority for the DRF through November 17, 2023, and a $16 billion supplemental appropriation ($15.50 billion for the costs of major disasters, and $500 million for the DRF base).

Under the most recent INF restriction, FEMA indicated that it would pause new Public Assistance (PA) and Hazard Mitigation obligations that were not essential for lifesaving and life-sustaining activities. It further indicated that under the restriction, it would continue to provide

• Individual Assistance payments directly to survivors for critical needs and housing;
• Public Assistance for states, tribes and territories essential for lifesaving and life-sustaining activities;
• State management costs;
• Mission assignments of federal partners for critical response activities;
• Fire Management Assistance grants; and
• Essential ongoing disaster operations, including salaries of FEMA field staff (Stafford Act employees).

Emergency Contingency Funding and Reserve Funds

At times, the Administration and Congress have examined methods of speeding up or broadening the availability of funds to address emergencies and disasters by changing how they were appropriated. Examples of this include the use of contingent appropriations and the proposal to establish a reserve fund for disaster relief.

Contingent Appropriations

In some of its first exercises of the emergency designation, Congress chose to provide a portion of the appropriation for the DRF as emergency-designated budget authority contingent on the Administration specifically requesting the additional funds and designating them as an emergency requirement. An example of this structure can be found in P.L. 103-75, a supplemental appropriations bill for FY1993:

For an additional amount for ''Disaster relief", $1,735,000,000, and in addition, $265,000,000, which shall be available only to the extent an official budget request for a specific dollar amount, that includes designation of the entire amount of the request as an emergency requirement as defined in the Balanced Budget and Emergency Deficit Control Act of 1985, as amended, is transmitted by the President to Congress, to remain available until September 30, 1997, for the Midwest floods and other disasters: Provided, That the entire amount is designated by Congress as an emergency requirement pursuant to section 251(b)(2)(D)(i) of the Balanced Budget and Emergency Deficit Control Act of 1985, as amended, and title I, chapter II, of P.L. 102-229.¹¹⁴

The FY2002 annual disaster relief appropriation was the last annual appropriation that included this type of contingent appropriation.

Reserve Funds

While appropriations requests for the DRF for many years included a special appropriated reserve within the DRF for unanticipated catastrophic disasters, the concept of a budgetary reserve fund outside the DRF has also been proposed in the past, which would enable appropriations for broader non-Stafford disaster relief initiatives.

In FY2002, alongside a request for the DRF that included disaster support costs and funding for prior-year disasters, the Administration proposed the creation a of $5.6 billion National Emergency Reserve allowance to support the costs of "significant new disasters." The DRF, the Small Business Administration (SBA) Disaster Loan Program, and wildfire programs at the Department of Agriculture and Department of the Interior would have been the primary recipients of this funding.¹¹⁵ The annual reserve would have been established in the budget resolution, and based on the average annual spending on "extraordinarily large events." It would have been allocated to the appropriations subcommittees to fund presidential requests for emergency requirements if two criteria were met: "the events were sudden, urgent, unforeseen, and not permanent; and adequate funding for a normal year has been provided for the applicable program by the Appropriations Committees." Unused reserve amounts could be rolled over into the next year.¹¹⁶ The proposal was not adopted.

Rescissions and Transfers from the DRF

Rescissions are cancellations of previously appropriated budget authority. They are made at times to redirect unobligated balances to other purposes through further appropriation, or to offset a portion of the cost of the legislation that carried them. From the establishment of the DRF in FY1948 through FY2003, rescissions were made three times from the DRF.¹¹⁷ From FY2004 through the present day, rescissions have been made 11 times.

Five of the 11 occurred before the enactment of the BCA:

• In FY2004, $225 million of an earlier $500 million supplemental appropriation to the DRF was rescinded as an offset for federal funding for certain wildfire costs in California.¹¹⁸
• In FY2006, over $23.4 billion of $60 billion in gross appropriations for the DRF was rescinded and reappropriated to other disaster recovery programs across the government.¹¹⁹
• In FY2008 and FY2009, three rescissions of DRF funding for the Hazard Mitigation Program for the state of Mississippi were made to pay for a grant for the state to purchase and deploy an interoperable communications system.¹²⁰

With the restructuring of the DRF appropriation under the BCA, FEMA faced a new challenge. Periodically, obligated funds that were no longer needed or eligible to be used for their original purpose would be "deobligated" and returned to the DRF for use. It was unclear whether those deobligated funds should be assigned to the base, or to the costs of major disasters. Deobligated funds that had been appropriated without a designation were ultimately considered to be a part of the base, as they were appropriated without a specified intent.

These were not insignificant amounts—in FY2013, FEMA recovered almost $910 million.¹²¹ Because the base is spent at a much slower rate than the disaster relief-designated portion of the DRF, a sizeable unobligated balance accrued. Both the Obama Administration and Trump Administration proposed rescinding portions of the unobligated recovered funds, including a request from the Trump Administration to rescind $250 million in FY2020. From FY2014 through FY2017, almost $2.5 billion was rescinded from the DRF, which offset a portion of the cost of the annual DHS appropriations bills.¹²²

The appropriations committees took a different approach in FY2019, when the Administration requested a $300 million rescission from the DRF in its budget proposal. Congress included language in the FY2019 DHS appropriations act to use $300 million in unobligated balances to fund part of the existing DRF appropriation.¹²³ This had the same net effect as rescinding the funds, in that the net appropriation was smaller, but also made a statement that the DRF balances were being used for Stafford Act purposes.

Additional rescissions were taken in FY2020 ($300 million)¹²⁴ and FY2022 ($147.6 million). In all of these cases, the rescissions were taken from the DRF base, rather than funds used to pay for costs pursuant to major disasters.

At times transfers have been made from the DRF appropriation to fund specific disaster-related costs. The first of these was a $5 million transfer to cover the costs of assistance to certain workers adversely affected by a drought in 1988. Recent transfers from the DRF include

• Office of Inspector General—First transfer from the DRF in annual appropriations for FY2000. Starting with the FY2002 DRF appropriation, transfers were made to support OIG oversight of disaster relief activities, first to the FEMA OIG, then the DHS OIG. Such transfers are now frequently part of supplemental appropriations for the DRF.
• Community Disaster Loans—Authorized in 1974, Community Disaster Loans (CDLs) provide support for communities suffering revenue losses as the result of a disaster.¹²⁵ Loans are funded through the Disaster Assistance Direct Loan Program (DADLP). Although the program is part of the Stafford Act, as specific separate appropriations were provided for it in FY1992, the DADLP is not eligible for funding through the general DRF appropriation absent specific transfer language. DADLP received its first transfer from the DRF for CDLs in a supplemental appropriation for the DRF in FY1992.¹²⁶
• Hermit's Peak / Calf Canyon Fire Settlement—The FY2023 Continuing Appropriations Act included a $2.5 billion transfer of unobligated balances from the DRF base to settle claims of victims injured by the Hermit's Peak/Calf Canyon Fire.¹²⁷ This transfer was specifically made from the unobligated resources provided in the CARES Act, specifically the remains of $15 billion that was directed to the DRF base.¹²⁸
• USAID Compact Aid Agreement—Unlike the other transfers, which are made on the basis of language in appropriations measures, a small transfer from the DRF base is projected each year to cover the costs of disaster relief pursuant to the Compacts of Free Association, under which USAID manages disaster relief and reconstruction assistance for the Federated States of Micronesia, the Republic of the Marshall Islands, and the Republic of Palau.¹²⁹

These transfers are distinct from the BRIC funding "set-aside," which earmarks budget authority within the major disasters subaccount of the DRF for program use. Should other funding in the major disasters subaccount become fully obligated, unobligated balances originally designated for the BRIC program can be made available for immediate response needs.

Issues for Congress

The federal government has defined a role for itself in emergency management and disaster recovery as a backstop for state, local, territorial, and tribal governments, providing limited relief for individuals and support for mitigation efforts. FEMA's DRF appropriation funds a great deal of the federal effort. As the DRF appropriation is simply an amount of budget authority provided to support disaster activities defined through separately crafted laws and policies, many of the issues related to the DRF are less about the appropriation than they are about the defined federal role.

Should the purpose of the DRF be rescoped?

Despite the magnitude of funding provided through the DRF and the breadth of Stafford Act relief, other appropriations support additional disaster-related activities in other departments and agencies. As noted earlier, HUD, USDA, DOT, DOD, and SBA all fund various disaster relief and recovery programs. With the COVID-19 pandemic, relief and recovery funds have come from a wide variety of accounts through a range of programs.

At various times in the past, efforts have been made to fund activities through the DRF that are not part of the current portfolio of Stafford Act programs. The Stafford Act already encompasses a wide range of emergency management, disaster relief, and disaster response activities. Making non-Stafford programs eligible for DRF funding is something Congress could choose to do, but it may not provide any obvious policy or budgetary advantage. Existing non-Stafford programs have their own funding streams, management, and oversight. Providing their resources through a new appropriation could complicate their funding stream and congressional oversight. While making the programs eligible for funding from the DRF could make additional budget authority available, it would be more transparent and direct for Congress to simply fund the program through its existing appropriation.

There is no special budgetary treatment for appropriations for the DRF—only for appropriations which are designated for the costs of major disasters or designated as emergency requirements, following the terms outlined in budget resolutions. Shifting discretionary spending out of one appropriations subcommittee's jurisdiction into another provides no overall budgetary benefit—the total amount of spending remains the same. Subcommittee allocations are set and reset every year (sometimes multiple times each year) at the discretion of the House and Senate appropriations committees, so such a move could well result in no net impact on available resources.

The concept of a broader funding stream providing discretionary resources for DRF, SBA, and USDA disaster relief programs has also been considered before. Such an idea, floated by a previous Administration but rejected by Congress, might have made more resources available in the immediate aftermath of a disaster, but it is not clear that such reorganization would make the programs more effective or subject to more thorough oversight. The move could actually limit the ability of Congress to provide specific oversight or direction through appropriations to the separate programs.

Congress could also break up the DRF into appropriations for the individual Stafford Act programs or groups of programs, similar to what was provided for COVID-19 pandemic-related funeral expenses in Division N of P.L. 116-260. This might allow for additional specific congressional oversight and direction, but it could reduce the flexibility that exists within the DRF to shift its resources to meet unanticipated disaster needs by segmenting the available resources, and possibly inadvertently limiting the amount of resources available for the highlighted programs in the future.

In response to the COVID-19 epidemic, the Administration and Congress used the major disaster provisions of the Stafford Act to respond to a public health crisis for the first time. As the country emerges from the COVID-19 pandemic, Congress may choose to reexamine a number of issues, including the following:

• Are the Stafford Act and DRF the best vehicles for providing assistance in responding to a public health crisis?
• How should Congress approach funding future public health needs?
• What was the interplay between natural disaster authorities and public health authorities in this situation, and how can that be made more efficient and effective?

How much is enough to have on hand?

Appropriations are frequently provided on the basis of what can be spent on a project in a given fiscal year. This thinking informs part of the funding request, as it includes a basis of spending on open disasters, where recovery is ongoing. A 10-year average informs the portion of the DRF budget request that pays for response and recovery from disasters that cost less than $500 million. Previous and current Administrations have sought additional reserve funds over and above those projected needs to pay for potential significant "no notice" events—this reserve request now stands at $2 billion. Even with this reserve, in FY2023, there was concern that the available funding in the major disasters DRF category could be depleted prior to the end of the fiscal year due to catastrophic events and higher-than-expected costs of previous incidents. Although FEMA indicates that funding set aside within the major disaster portion of the DRF is available for responding to events if its other funds are depleted, this is not the stated congressional intent for those funds, and FEMA has never accessed those resources.

On the other hand, as noted above, from FY2014 to FY2017, almost $2.5 billion in funding was rescinded from unobligated balances in the DRF, and in FY2019, unobligated balances were used to offset appropriations for the DRF. FEMA's budget explicitly states that in the event of catastrophic disaster activity, it will need to come to Congress for supplemental appropriations for the DRF, as it has in the past.

What accommodations should be made in the federal budget for disaster relief?

While disaster relief is a relatively small part of the discretionary budget, and an even smaller part of the overall federal budget, disaster relief spending is anticipated to continue growing in the coming years. In modern history, Congress has been generally willing to provide resources for major disasters on an as-needed basis. However, discussions of deficit and debt continue in Congress, and with the expiration of the Budget Control Act's discretionary spending limits and the statutory adjustment for disaster relief at the end of FY2021, new agreements will need to be reached. The central question for disaster relief budgeting is this: Does disaster relief represent enough of a priority for the federal government to maintain the status quo notwithstanding potential increasing costs?

When budget controls were put in place starting in the 1980s, up through 2022, exceptions were provided to help ensure relief and recovery efforts would continue to be funded. With the expiration of the Budget Control Act statutory caps on discretionary spending, one limitation on disaster relief spending—albeit one with a limited practical effect, as noted above—has gone away. The allowable adjustment for disaster relief expired as well, although a similar mechanism to adjust the limits set by budget resolutions and subcommittee allocations was included in the FY2022 budget resolution. The adjustment has effectively allowed most of the annual DRF appropriation to be provided without competing against other homeland security priorities for the discretionary funding provided under the Homeland Security appropriations subcommittee's allocation.¹³⁰ Congress may consider whether they want that process to continue.

Congress may also debate whether to try to limit disaster relief spending. The most direct means of doing this would not be to change the DRF appropriation, but by changing the underlying laws that authorize the programs it funds. Implementing relief limits or deductibles for states or smaller jurisdictions, larger nonfederal cost shares, or changes in the declaration process may prove unpopular, and having to vote for them once in more durable authorizing legislation may be more practical than doing so annually in appropriations legislation.

Appendix. General Disaster Relief Appropriations, FY1964-FY2023