WASHINGTON (Jan. 20, 2016) – The R Street Institute welcomed the announcement, published in today’s Federal Register, that the Federal Emergency Management Agency is seeking to make reforms to the disaster declaration process that would more clearly align incentives and protect taxpayers.

FEMA announced it is considering establishing a “disaster deductible” as part of its Public Assistance Program. The program would require state and other local governments to commit a set level of resources before they would be eligible for federal grants following a presidential major disaster declaration.

“R Street long has advocated similar reforms to the Stafford Act system of disaster assistance,” said R Street Senior Fellow R.J. Lehmann. “This proposal from FEMA is a tremendous first step toward aligning incentives to ensure that local governments invest in mitigation and disaster preparedness. It would reduce moral hazard, better manage taxpayer dollars and better safeguard citizens’ lives and property.”

Credit could be granted toward meeting the FEMA deductible “through proactive pre-event actions such as adopting enhanced building codes, establishing and maintaining a disaster relief fund or self-insurance plan, or adoption of other measures that reduce the recipient’s risk from disaster events,” the agency said.

FEMA has opened its proposal to public comment, with a deadline of March 21, 2016.

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