Disaster Management Costs Modernization Act
- Bill Number
- S. 773
- Origin Chamber
- Senate
- Congress
- 119th Congress, Session 1
- Policy Area
- Emergency Management
- Status
- Introduced
- Latest Action
- 2025-02-27: Read twice and referred to the Committee on Homeland Security and Governmental Affairs.
- Last Updated
- 2026-02-05T12:03:16Z
AI-Generated Summary
Purpose
The Disaster Management Costs Modernization Act (S. 773) aims to encourage states, Indian Tribes, and U.S. territories to complete and close disaster recovery projects more efficiently. It does this by allowing unused (excess) funds originally set aside for managing those projects to be redirected toward management costs for other disaster-related activities, rather than returning them unused to the federal government.
Key Provisions
- Amendment to Existing Law: Updates Section 324 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (which governs federal funding for disaster management costs) by adding a new subsection (c).
- Definition of Excess Funds: Defines "excess funds for management costs" as the difference between the amount originally authorized for management (up to 3% of certain disaster aid grants) and the actual amount spent by the recipient (grantee or subgrantee) when the grant is closed.
- Availability and Use of Excess Funds:
- The President (through the Federal Emergency Management Agency, or FEMA) can make these excess funds available to grantees or subgrantees for future disaster aid under specific sections of the Stafford Act.
- Allowable uses include:
- Building capacity to prepare for, recover from, or reduce the effects of major disasters or emergencies.
- Covering management costs for other major disasters, emergencies, preparedness activities, or mitigation efforts (e.g., projects to lessen future disaster damage).
- These funds remain available for 5 years from the date they are made accessible.
- Applicability: Applies only to major disasters or emergencies declared on or after the bill's enactment date, and to funding appropriated on or after that date.
- GAO Study Requirement: Within 180 days of enactment, the Government Accountability Office (GAO, an independent congressional watchdog) must report to relevant Senate and House committees on actual management costs for major disasters over the past 5 years. The report will assess if the current funding levels are appropriate, including details on costs, usage, disaster lengths, and reasons for delays.
- No New Funding: The changes do not authorize any additional federal spending; they repurpose existing allocations.
Significant Changes to Existing Law
- Previously, under Section 324, management cost funds (capped at 3% of certain grants) that went unused had to be returned to the federal government upon project closure, providing no incentive to finish projects quickly.
- The bill introduces a new mechanism to retain and reuse excess management funds for other eligible activities, effectively turning potential waste into a resource for ongoing disaster management.
- It restructures the section's wording for clarity, redesignating parts without altering core percentages for management cost allowances.
Potential Impacts
- On Government Agencies: FEMA and the President gain flexibility in administering funds, potentially reducing administrative burdens and encouraging timely project closures. The GAO study could lead to future adjustments in funding formulas based on real data.
- On Citizens: Faster closure of recovery projects may speed up overall disaster recovery in affected communities, improving access to rebuilt infrastructure and services. Repurposed funds could enhance preparedness and mitigation, reducing future disaster risks and costs for taxpayers.
- On International Relations: No direct impact, as the bill focuses on domestic U.S. disaster aid to states, Tribes, and territories.
Main Stakeholders Affected
- States, Indian Tribes, and U.S. Territories: Primary recipients (grantees and subgrantees) who manage disaster projects; they benefit from incentives to close projects and reuse funds for broader resilience efforts.
- Federal Agencies: FEMA (implements the changes) and GAO (conducts the required study).
- Congress: Oversight committees (Senate Homeland Security and Governmental Affairs; House Transportation and Infrastructure) receive the GAO report and could influence future disaster policy.
- Local Governments and Communities: Indirectly affected through improved efficiency in federal aid distribution for recovery and mitigation.
Notable Legal, Constitutional, or Political Implications
- Legal: Strengthens the Stafford Act's framework for efficient fund use without expanding eligibility or caps, ensuring compliance with federal grant rules. The 5-year availability period provides flexibility while maintaining accountability.
- Constitutional: Aligns with Congress's spending power under Article I, Section 8, by reallocating existing appropriations without new authorizations, avoiding potential separation-of-powers issues.
- Political: Bipartisan sponsorship (by Senators Hassan, D-NH, and Lankford, R-OK) suggests broad appeal for fiscal responsibility in disaster aid. The GAO study promotes transparency and data-driven policymaking, potentially reducing waste and building support for future disaster funding amid increasing climate-related events. No major controversies anticipated, as it avoids new spending or mandates.
This summary was generated by AI and may contain inaccuracies. Refer to the official source document for the authoritative text.
Sponsor
Sen. Hassan, Margaret Wood [D-NH]
Cosponsors (4)
Sen. Lankford, James [R-OK], Sen. Wicker, Roger F. [R-MS], Sen. Rounds, Mike [R-SD], Sen. Ossoff, Jon [D-GA]
Recent Actions
- 2025-02-27: Read twice and referred to the Committee on Homeland Security and Governmental Affairs.
- 2025-02-27: Introduced in Senate
Bill Versions
- Disaster Management Costs Modernization Act — issued 2025-02-27 — PDF (6 pages)