State and Local Public Finance: How do state and local governments respond to disasters/emergencies?

With recent natural disasters of Hurricane Sandy, flooding of the Red River and in NE Minnesota, tornadoes in North Minneapolis, and a host of other natural disasters, I thought it would be pertinent to discover the policies and procedures that governments have at their disposal to react to these devastating events. Due to the uncertainty, seemingly increasing, and sheer destructive forces that are at play with these natural disasters, the effects on state and local governments can be crippling. The following looks at how intergovernmental grants can help the recovery efforts.

Source: NOAA

Federal Government

The Federal Emergency Management Agency (FEMA) is the federal government’s central responder to disasters and emergencies. As a major agency in the Department of Homeland Security, their abbreviated stated mission is to prepare, respond, mitigate, and to help recover from disasters and emergencies that occur. While they deploy many different services to achieve their goals, the Public Assistance grant program is of particular interest to this blog post.

The Public Assistance (PA) grant program provides assistance to State, Tribal, and local governments through supplemental Federal disaster monies that cover the following activities: debris removal, emergency protective measures, and repair, replace, or restore disaster damaged publicly owned facilities. The federal share of the grant is no less than 75% of the eligible cost with the remaining amount typically paid for by the State (grantee) who determines how that will be split up by the (sub- grantees) eligible applicants. Because this is highly coordinated activity between federal, state, and local governments there is a host of roles and responsibilities as well as eligibility requirements that need to be fulfilled in order for successful assistance. The following chart describes the life-cycle of the PA grant.

Source: FEMA

· Preliminary Damage Assessment (PDA)

· Presidential Disaster Declaration

· Applicants' Briefing by Grantee

· Submission of Request for Public Assistance by Applicant

· Kick-off Meeting with Public Assistance Coordinator (PAC)

· Project Formulation and Cost Estimating

· Project Review and Validation

· Obligation of Federal Funds and Disbursement to Subgrantees

· Appeals and Closeout

Minnesota Government

The Minnesota state agency that deals with the coordination of disaster relief is the Homeland Security Emergency Management (HSEM), a division within the Minnesota Department of Public Safety. They administer 17 different federal-state grant programs and in FY2009 they provided more than $80 million to over 300 local governments. Much of these different grants involve the federal government and relate to homeland security activities but the Emergency Management Performance Grant (EMPG) is provided to enhance and sustain state and local emergency management capabilities. HSEM also is in charge of Minnesota Recovers, a state clearinghouse for recovery information that pertains to hazards and natural disasters that effect Minnesota. For example, if the President provides a disaster declaration for the state of Minnesota, Minnesota Recovers posts the effected counties as well as the specific assistance programs that are available for the aid in recovery.