[Senate Report 117-258]
[From the U.S. Government Publishing Office]


                                                      Calendar No. 649

117th Congress     }                                 {     Report
                                 SENATE
 2d Session        }                                 {     117-258
_______________________________________________________________________



              DISASTER MANAGEMENT COSTS MODERNIZATION ACT

                               __________

                              R E P O R T

                                 of the

                   COMMITTEE ON HOMELAND SECURITY AND

                          GOVERNMENTAL AFFAIRS

                          UNITED STATES SENATE

                              to accompany

                                S. 4654

             TO AMEND SECTION 324 OF THE ROBERT T. STAFFORD
              DISASTER RELIEF AND EMERGENCY ASSISTANCE ACT
               TO INCENTIVIZE STATES, INDIAN TRIBES, AND
            TERRITORIES TO CLOSE DISASTER RECOVERY PROJECTS
               BY AUTHORIZING THE USE OF EXCESS FUNDS FOR
         MANAGEMENT COSTS FOR OTHER DISASTER RECOVERY PROJECTS



             [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]




               December 14, 2022.--Ordered to be printed





                                ______
                                 

                 U.S. GOVERNMENT PUBLISHING OFFICE

39-010                    WASHINGTON : 2023













        COMMITTEE ON HOMELAND SECURITY AND GOVERNMENTAL AFFAIRS

                   GARY C. PETERS, Michigan, Chairman

THOMAS R. CARPER, Delaware           ROB PORTMAN, Ohio
MAGGIE HASSAN, New Hampshire         RON JOHNSON, Wisconsin
KYRSTEN SINEMA, Arizona              RAND PAUL, Kentucky
JACKY ROSEN, Nevada                  JAMES LANKFORD, Oklahoma
ALEX PADILLA, California             MITT ROMNEY, Utah
JON OSSOFF, Georgia                  RICK SCOTT, Florida
                                     JOSH HAWLEY, Missouri

                   David M. Weinberg, Staff Director
                    Zachary I. Schram, Chief Counsel
         Christopher J. Mulkins, Director of Homeland Security
           Naveed Jazayeri, Senior Professional Staff Member
                Pamela Thiessen, Minority Staff Director
            Sam J. Mulopulos, Minority Deputy Staff Director
       Clyde E. Hicks Jr., Minority Director of Homeland Security
                     Laura W. Kilbride, Chief Clerk








                                                      Calendar No. 649

117th Congress     }                                 {     Report
                                 SENATE
 2d Session        }                                 {     117-258

======================================================================



 
              DISASTER MANAGEMENT COSTS MODERNIZATION ACT

                                _______
                                

               December 14, 2022.--Ordered to be printed

                                _______
                                

 Mr. Peters, from the Committee on Homeland Security and Governmental 
                    Affairs, submitted the following

                              R E P O R T

                         [To accompany S. 4654]

    The Committee on Homeland Security and Governmental 
Affairs, to which was referred the bill (S. 4654) to amend 
section 324 of the Robert T. Stafford Disaster Relief and 
Emergency Assistance Act to incentivize States, Indian Tribes, 
and Territories to close disaster recovery projects by 
authorizing the use of excess funds for management costs for 
other disaster recovery projects, having considered the same, 
reports favorably thereon with an amendment, in the nature of a 
substitute, and recommends that the bill, as amended, do pass.

                                CONTENTS

                                                                   Page
  I. Purpose and Summary..............................................1
 II. Background and Need for the Legislation..........................2
III. Legislative History..............................................2
 IV. Section-by-Section Analysis of the Bill, as Reported.............3
  V. Evaluation of Regulatory Impact..................................3
 VI. Changes in Existing Law Made by the Bill, as Reported............3

                         I. Purpose and Summary

    S. 4654, the Disaster Management Costs Modernization Act, 
would allow excess management funds authorized by the Federal 
Emergency Management Agency (FEMA) after a disaster or 
emergency to be rolled over after the close out of an incident. 
The excess funds can be used for disaster response and recovery 
capacity building or for management costs of other open 
disasters. Any excess management funds are still subject to the 
caps set in law and only available for a period of 5 years. 
Under this bill, excess costs are defined as the difference 
between management costs authorized by law and the actual 
amount expended by the recipient.

              II. Background and Need for the Legislation

    Financial management is a crucial component of successful 
disaster response and recovery. Under the Stafford Act, 
management costs are defined to include any indirect cost, any 
direct administrative cost, and any other administrative 
expense associated with a specific project under a major 
disaster, emergency, or disaster preparedness or mitigation 
activity or measure.\1\ Eligible expenses for management costs 
can include conducting preliminary damage assessments, 
trainings, site inspections, closeout reviews and more.\2\
---------------------------------------------------------------------------
    \1\42 U.S.C. Sec. 5165(b).
    \2\Federal Emergency Management Agency, Public Assistance 
Management Costs (Interim): FEMA Recovery Policy (FP-104-11-2) (Nov. 
12, 2018).
---------------------------------------------------------------------------
    Signed in 2018, as part of the Federal Aviation 
Administration Reauthorization Act, the Disaster Recovery 
Reform Act authorized a robust increase in management costs 
provided for disasters and emergencies across the country.\3\ 
According to the National Emergency Management Association 
(NEMA), despite an increase in emergency management funding, a 
major shortcoming is ``the inability for grantees to utilize 
this allowance across all open disasters.''\4\ NEMA recommends 
for FEMA to allow grantees to utilize management funds across 
different open disasters which will, in turn, strengthen 
recovery and mitigation efforts.\5\ Allowing this flexibility 
was also proposed in a recent Government Accountability Office 
report as an option for FEMA to simplify federal disaster 
recovery program requirements.\6\
---------------------------------------------------------------------------
    \3\Pub. L. No. 115-254 (2018).
    \4\National Emergency Management Association, NEMA 2021 Policy 
Priorities (2019) (https://www.nemaweb.org/index.php/files/113/2021-
Meeting-of-the-States/295/NEMA--2021-Policy-Priorities.pdf).
    \5\Id.
    \6\Government Accountability Office, Disaster Recovery: Actions 
Needed to Improve the Federal Approach (GAO-23-104956) (Nov. 2022).
---------------------------------------------------------------------------
    This legislation would allow for the excess management 
funds authorized by FEMA to a grantee after a disaster or 
emergency to be rolled over after the close out of an incident. 
The bill specifies that the excess funds may be used for 
activities associated with disaster recovery and preparedness. 
By allowing this flexibility, recipients of management costs 
will be able to help ensure that they have the necessary 
resources to manage future disasters and sustain response and 
recovery capabilities between disasters.

                        III. Legislative History

    S. 4654 was introduced on July 28, 2022 by Senators Hassan 
(D-NH) and Lankford (R-OK). The bill was referred to the Senate 
Committee on Homeland Security and Governmental Affairs. The 
Committee considered this bill at a business meeting on August 
3, 2022. An amendment in the nature of a substitute was filed 
by Senator Hassan and later modified. The modified substitute 
amendment incorporated technical drafting assistance from FEMA 
and made technical edits to the bill. The Hassan substitute 
amendment, as modified, was adopted by voice vote en bloc with 
Senators Peters, Hassan, Sinema, Rosen, Padilla, Ossoff, 
Lankford, Romney, Scott, and Hawley present. The Committee 
ordered the bill, as amended by the modified Hassan substitute 
amendment, to be reported favorably by voice vote en bloc. 
Senators present for the vote were: Peters, Hassan, Sinema, 
Rosen, Padilla, Ossoff, Lankford, Romney, Scott, and Hawley.

        IV. Section-by-Section Analysis of the Bill, as Reported


Section 1. Short title

    This section designates the name of the bill as the 
``Disaster Management Costs Modernization Act.''

Section 2. Use of excess funds for management costs

    Subsection (a) amends section 324 of the Robert T. Stafford 
Disaster Relief and Emergency Assistance Act by creating a new 
subsection within titled ``Use of Excess Funds for Management 
Costs.'' This subsection defines the term ``excess funds for 
management costs'' as the difference between management costs 
authorized by law and the actual amount expended by the 
recipient. The subsection also states that the rolled-over 
excess funds can be used for disaster response and recovery 
capacity building or for management costs of other open 
disasters. Additionally, this subsection provides that any 
excess management funds are still subject to the caps set in 
law and only available for a period of 5 years.
    Subsection (b) clarifies this legislation applies to grants 
rewarded in relation to a declared major disaster or emergency 
that is open on, or made on or after enactment of this Act.

                   V. Evaluation of Regulatory Impact

    Pursuant to the requirements of paragraph 11(b) of rule 
XXVI of the Standing Rules of the Senate, the Committee has 
considered the regulatory impact of this bill and determined 
that the bill will have no regulatory impact within the meaning 
of the rules. The Committee agrees with the Congressional 
Budget Office's statement that the bill contains no 
intergovernmental or private-sector mandates as defined in the 
Unfunded Mandates Reform Act (UMRA) and would impose no costs 
on state, local, or tribal governments.

       VI. Changes in Existing Law Made by the Bill, as Reported

    In compliance with paragraph 12 of rule XXVI of the 
Standing Rules of the Senate, changes in existing law made by 
the bill, as reported, are shown as follows: (existing law 
proposed to be omitted is enclosed in brackets, new matter is 
printed in italic, and existing law in which no change is 
proposed is shown in roman):

ROBERT T. STAFFORD DISASTER RELIEF AND EMERGENCY ASSISTANCE ACT

           *       *       *       *       *       *       *


TITLE III--MAJOR DISASTER AND EMERGENCY ASSISTANCE ADMINISTRATION

           *       *       *       *       *       *       *


SEC. 324. MANAGEMENT COSTS.

    (a) * * *
    (b) * * *
    (c) Use of Excess Funds for Management Costs.--
          (1) Definition.--In this subsection, the term `excess 
        funds for management costs' means the difference 
        between--
                  (A) the amount of the applicable specific 
                management costs authorized under subsection 
                (b); and
                  (B) as of the date on which the incident is 
                closed, the amount of funding for management 
                costs activities expended by the grantee or 
                subgrantee receiving the financial assistance 
                for costs described in subparagraph (A).
          (2) Availability of excess funds for management 
        costs.--The President may make available to a grantee 
        or subgrantee receiving financial assistance under 
        section 403, 404, 406, 407, or 502 any excess funds for 
        management costs.
          (3) Use of funds.--Excess funds for management costs 
        made available to a grantee or subgrantee under 
        paragraph (2) may be used for activities associated 
        with building capacity to respond to or recover from 
        the types of incidents for which assistance may be made 
        available under section 403, 404, 406, 407, or 502 and 
        to provide such assistance, including for providing 
        training and other activities associated with any major 
        disaster or emergency declaration, or to otherwise 
        prepare for such an incident.
          (4) Availability.--Excess funds for management costs 
        made available to a grantee or subgrantee under 
        paragraph (2) shall remain available to the grantee or 
        subgrantee until the date that is 5 years after the 
        date on which the excess funds for management costs are 
        made available under paragraph (2).
    [(c)] (d) Review.--The President shall review the 
management cost rates established under subsection (b) not 
later than 3 years after the date of establishment of the rates 
and periodically thereafter.

           *       *       *       *       *       *       *


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