[Federal Register Volume 89, Number 14 (Monday, January 22, 2024)]
[Rules and Regulations]
[Pages 3990-4125]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-00677]



[[Page 3989]]

Vol. 89

Monday,

No. 14

January 22, 2024

Part II





Department of Homeland Security





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Federal Emergency Management Agency





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44 CFR Part 206





Individual Assistance Program Equity; Interim Final Rule

  Federal Register / Vol. 89 , No. 14 / Monday, January 22, 2024 / 
Rules and Regulations  

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

44 CFR Part 206

[Docket ID: FEMA-2023-0003]
RIN 1660-AB07


Individual Assistance Program Equity

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Interim final rule.

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SUMMARY: The Federal Emergency Management Agency (FEMA) is publishing 
this interim final rule (IFR) amending its regulations governing the 
Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program.

DATES: 
    Effective Date: This rule is effective March 22, 2024.
    Applicability Date: This rule applies to Emergencies and Major 
Disasters declared on or after March 22, 2024.
    Comment Date: Comments must be received no later than July 22, 
2024.

ADDRESSES: You may submit comments, identified by Docket ID: FEMA-2023-
0003, via the Federal eRulemaking Portal: http://www.regulations.gov. 
Follow the instructions for submitting comments.

FOR FURTHER INFORMATION CONTACT: Kristina McAlister, Federal Emergency 
Management Agency, 500 C Street SW, Washington, DC 20472. Phone: 866-
826-8751 or email: [email protected].

SUPPLEMENTARY INFORMATION: 

Table of Contents

I. Public Participation
II. Executive Summary
III. Background
    A. Individual Assistance
    B. Impacts of Climate Change on Disaster Assistance
    C. Equity in Individual Assistance
    1. Income Project
    2. Equity RFI--IA Program Equity Responses to Comments
    D. Changes in Policy Positions To Increase Equity in IHP
    1. Insurance Proceeds
    2. Requirement To Apply for an SBA Loan Prior to Receipt of ONA
    3. Home Repair Pre-Existing Conditions
    4. Serious Needs and Displacement Assistance
IV. Discussion of the Interim Final Rule
    A. Section 206.101--Temporary Housing Assistance for Emergencies 
and Major Disasters Declared on or Before October 14, 2002
    B. Section 206.110--Federal Assistance to Individuals and 
Households
    C. Section 206.111--Definitions
    D. Section 206.112--Registration Period
    E. Section 206.113--Eligibility Factors
    F. Section 206.114--Criteria for Continued or Additional 
Assistance
    G. Section 206.115--Appeals
    H. Section 206.117--Housing Assistance
    I. Section 206.118--Disposal of Housing Units
    J. Section 206.119--Financial Assistance To Address Other Needs
    K. Section 206.131--Individual and Family Grant Program for 
Major Disasters Declared on or Before October 14, 2002
    L. Section 206.191--Duplication of Benefits
V. Regulatory Analyses
    A. Administrative Procedure Act
    B. Executive Order 12866, Regulatory Planning and Review; 
Executive Order 13563, Improving Regulation and Regulatory Review; 
and Executive Order 14094, Modernizing Regulatory Review
    1. Need for Regulation
    2. Affected Population
    3. Baseline
    4. Transfer Payments
    5. Costs
    6. Cost Savings
    7. Total Net Costs
    8. Benefits
    9. Circular A-4 Accounting Statement, No-Action Baseline (2020$) 
Table
    10. Circular A-4 Accounting Statement, Pre-Guidance Baseline 
(2020$) Table
    11. Marginal Analysis Table
    C. Regulatory Flexibility Act
    D. Unfunded Mandates Reform Act
    E. National Environmental Policy Act of 1969 (NEPA)
    F. Paperwork Reduction Act of 1995
    G. Privacy Act/E-Government Act of 2002
    H. Executive Order 13175, Consultation and Coordination With 
Indian Tribal Governments
    I. Executive Order 13132, Federalism
    J. Executive Order 12630, Taking of Private Property
    K. Executive Order 12898, Environmental Justice and Executive 
Order 14096, Revitalizing Our Nation's Commitment to Environmental 
Justice for All
    L. Executive Order 12988, Civil Justice Reform
    M. Executive Order 13045, Protection of Children From 
Environmental Health Risks and Safety Risks
    N. Executive Order 11988, Floodplain Management
    O. Executive Order 11990, Protection of Wetlands
    P. National Historic Preservation Act
    Q. Endangered Species Act
    R. Congressional Review of Agency Rulemaking

Table of Abbreviations

ADA--Americans with Disabilities Act
APA--Administrative Procedure Act
CATEX--Categorical Exclusions
CDBG-DR--Community Development Block Grant Disaster Recovery Program
CEQ--Council on Environmental Quality
CFR--Code of Federal Regulations
CNA--Critical Needs Assistance
CPI-U--Consumer Price Index for All Urban Consumers
CRA--Congressional Review of Agency Rulemaking Act
CTHA--Continued Temporary Housing Assistance
DCM--Disaster Case Management
DHAP--Disaster Housing Assistance Program
DHS--Department of Homeland Security
DHS-OIG--Department of Homeland Security's Office of Inspector 
General
DMA2K--Disaster Mitigation Act of 2000
DRC--Disaster Recovery Center
DRRA--Disaster Recovery Reform Act of 2018
EA--Environmental Assessment
EDW--Enterprise Data Warehouse
EIS--Environmental Impact Statement
ESA--Endangered Species Act
FCO--Federal Coordinating Officer
FDAA--Federal Disaster Assistance Administration
FEMA--Federal Emergency Management Agency
FIT--Failed Income Test
FmHA--Farmers Home Administration
FMR--Fair Market Rent
FVL--FEMA Verified Loss
FY--Fiscal Year
GAO--Government Accountability Office
GFIP--Group Flood Insurance Policy
GSA--U.S. General Services Administration
HA--Housing Assistance
HUD--U.S. Department of Housing and Urban Development
IA--Individual Assistance
IAPPG--Individual Assistance Program and Policy Guide
IFG--Individual and Family Grant Program
IFR--Interim Final Rule
IHP--Individuals and Households Program
IRS--Internal Revenue Service
JFO--Joint Field Office
LEP--Limited English Proficiency/Limited English Proficient
LER--Lodging Expense Reimbursement
LI--Lower Income
MLR--Multifamily Lease and Repair
NEMIS--National Emergency Management Information System
NEPA--National Environmental Policy Act of 1969
NFIA--National Flood Insurance Act of 1968, as Amended
NFIP--National Flood Insurance Program
NHPA--National Historic Preservation Act
NPRM--Notice of Proposed Rulemaking
OIG--Office of Inspector General
OMB--Office of Management and Budget
ONA--Other Needs Assistance
PHC--Permanent Housing Construction
PHP--Permanent Housing Plan
PIA--Privacy Impact Assessment
PKEMRA--Post-Katrina Emergency Management Reform Act of 2006
RA--Regional Administrator
RA--Rental Assistance
RFA--Regulatory Flexibility Act of 1980
RFI--Request for Information
RIA--Regulatory Impact Analysis
RPFVL--Real Property FEMA Verified Loss
SBA--Small Business Administration
SFHA--Special Flood Hazard Area

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SRIA--Sandy Recovery Improvement Act of 2013
Stafford Act--Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, as Amended
STT--State, Tribal, or Territorial
Treasury--U.S. Department of Treasury
TSA--Transitional Sheltering Assistance
USGCRP--U.S. Global Change Research Program
Welfare Reform Act--Title IV of the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996

I. Public Participation

    We encourage you to participate in this rulemaking by submitting 
comments and related materials. We will consider all comments and 
materials received during the comment period.
    If you submit a comment, identify the agency name and the Docket ID 
for this rulemaking, indicate the specific section of this document to 
which each comment applies, and give the reason for each comment. All 
submissions will be posted, without change, to the Federal e-Rulemaking 
Portal at www.regulations.gov and will include any personal information 
you provide. Therefore, submitting this information makes it public. 
For more about privacy and the docket, visit https://www.regulations.gov/document?D=DHS-2018-0029-0001.
    Viewing comments and documents: For access to the docket to read 
background documents or comments received, go to the Federal e-
Rulemaking Portal at http://www.regulations.gov.

II. Executive Summary

    The Federal Emergency Management Agency (FEMA) is publishing this 
interim final rule (IFR) amending its regulations governing the 
Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program. Specifically, the IFR 
increases eligibility for home repair assistance by amending the 
definitions and application of the terms safe, sanitary, and 
functional, allowing assistance for certain accessibility-related 
items, and amending its approach to evaluating insurance proceeds; 
allows for the re-opening of the applicant registration period when the 
President adds new counties to the major disaster declaration; 
simplifies the documentation requirements for continued temporary 
housing assistance; simplifies the appeals process; simplifies the 
process to request approval for a late registration; removes the 
requirement to apply for a Small Business Administration (SBA) loan as 
a condition of eligibility for Other Needs Assistance (ONA); and 
establishes additional eligible assistance under ONA for serious needs, 
displacement, disaster-damaged computing devices and essential tools 
for self-employed individuals. FEMA also makes revisions to reflect 
changes to statutory authority that have not yet been implemented in 
regulation, to include provisions for utility and security deposit 
payments, lease and repair of multifamily rental housing, child care 
assistance, maximum assistance limits, and waiver authority.

III. Background

A. Individual Assistance

    FEMA is responsible for administering and coordinating the Federal 
Government response to Presidentially declared disasters pursuant to 
the Robert T. Stafford Disaster Relief and Emergency Assistance Act, as 
amended (Stafford Act), Public Law 93-288, 42 U.S.C. 5121 et seq. When 
a catastrophe occurs in a State or affects the members of a Tribal 
community, the State's Governor or Tribal Chief Executive may request a 
Presidential declaration of a major disaster pursuant to Section 401 of 
the Stafford Act. 42 U.S.C. 5170(a), (b); 44 CFR 206.36(a). Such a 
request must be based on a finding that the disaster is of such 
severity and magnitude that an effective response is beyond the 
capabilities of the State or Tribal government and the affected local 
governments and that Federal assistance is necessary. 42 U.S.C. 5170. 
The President's declaration of a disaster will designate the areas 
within a State, or for an Indian Tribal government, where Federal 
assistance may be made available (including local governments such as 
counties, parishes, or Tribal lands, if appropriate) and identify the 
types of assistance that are authorized under the declaration, 44 CFR 
206.40(a), although other types may be authorized later, 44 CFR 
206.40(c). A major disaster declaration may authorize all, or only 
particular types of, supplemental Federal assistance requested by the 
Governor or Tribal Chief Executive. 44 CFR 206.40(a).
    One of those types is ``Federal Assistance to Individuals and 
Households'' governed by section 408 of the Stafford Act, which 
authorizes FEMA to provide financial assistance and direct services to 
individuals and households who, as a direct result of a major disaster, 
have necessary expenses and serious needs in cases in which the 
individuals and households are unable to meet such expenses or needs 
through other means. 42 U.S.C. 5174. FEMA refers to this assistance as 
the Individuals and Households Program (IHP).
    Section 408 categorizes IHP into two provisions of assistance: 
Housing Assistance (HA) and ONA. Housing Assistance is available for 
individuals and households who are displaced from their pre-disaster 
primary residences \1\ or whose pre-disaster residences are rendered 
uninhabitable or, for individuals with disabilities, inaccessible or 
uninhabitable, as a result of damage caused by a major disaster. 42 
U.S.C. 5174(b). FEMA may provide those individuals: (1) temporary 
housing assistance in the form of financial assistance (funds provided 
to an individual to reimburse for hotels, motels, or other short-term 
lodging (referred to as Lodging Expense Reimbursement, or LER) or to 
rent alternate housing accommodations while the individual is displaced 
from their primary residence) or direct assistance (FEMA may provide 
the individual temporary housing units or FEMA may lease and repair 
multifamily rental properties (referred to as Multifamily Lease and 
Repair, or MLR) for the purpose of housing individuals); (2) financial 
assistance to repair owner-occupied private residences, utilities, and 
residential infrastructure damaged by a major disaster to a safe and 
sanitary living or functioning condition (referred to as home repair 
assistance); (3) financial assistance to replace owner-occupied private 
residences damaged by a major disaster (referred to as home replacement 
assistance); and (4) in rare circumstances, financial or direct 
assistance to construct permanent or semi-permanent housing (referred 
to as Permanent Housing Construction, or PHC). 42 U.S.C. 5174(c).
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    \1\ Per 44 CFR 206.111 ``primary residence'' means the dwelling 
where the applicant normally lives, during the major portion of the 
calendar year; or the dwelling that is required because of proximity 
to employment, including agricultural activities, that provide 50 
percent of the household's income. Home Repair Assistance and Home 
Replacement Assistance are not available for non-traditional forms 
of housing that do not have structural elements to assess and 
calculate a repair or replacement award (e.g., tents). By policy, 
FEMA defines non-traditional housing as a form of dwelling void of 
structural floor, structural walls, and structural roof. See page 62 
of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
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    ONA is financial assistance FEMA makes available to individuals and 
households adversely affected by a disaster to address their necessary 
expenses and serious needs.\2\ FEMA

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awards two types of ONA: SBA-dependent, which provides assistance for 
personal property, transportation, and Group Flood Insurance Policies 
(GFIPs); and non SBA-dependent ONA, which provides funeral assistance, 
medical and dental assistance, childcare assistance, moving and storage 
assistance, critical needs assistance, cleaning and sanitizing 
assistance as well as assistance for miscellaneous items.\3\ To obtain 
SBA-dependent ONA, FEMA currently requires individuals above a certain 
income level, as identified in SBA-provided income test tables, to 
apply for a disaster loan from SBA; SBA-dependent ONA includes Personal 
Property Assistance, Transportation Assistance, and GFIP.\4\ If those 
individuals were denied for a loan by the SBA or the amount received 
did not satisfy their total necessary expenses, FEMA could provide them 
with assistance for SBA-dependent types of ONA. Prior to this rule's 
revisions, these provisions were located in 44 CFR 206.119(a). FEMA did 
not require application to the SBA for individuals below the relevant 
income threshold or for other types of ONA.\5\
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    \2\ 42 U.S.C. 5174(e).
    \3\ See page 146 of FEMA Policy (FP) 104-009-03, Individual 
Assistance Program and Policy Guide, Version 1.1 (IAPPG 1.1). 
https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \4\ Applicants whose pre-disaster home was located in a Special 
Flood Hazard Area and received assistance for insurable flood 
damaged real or personal property may be considered for a FEMA-
purchased GFIP certificate, which provides 3 years of flood 
insurance coverage.
    \5\ The SBA provides FEMA with the relevant income threshold 
information on a yearly basis. The income threshold used is 
determined by the individual's household situation and accounts for 
where the individual resides and the number of dependents living in 
the household.
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    As detailed further below, section 1212 of the Disaster Recovery 
Reform Act of 2018, Public Law 115-254, 132 Stat. 3448 (Oct. 5, 2018) 
amended Section 408(h) to establish separate caps for each category of 
assistance. Currently, the maximum amount of IHP HA and ONA financial 
assistance for any single emergency or major disaster is $42,500.\6\ 
These financial caps do not apply to the provision of financial 
assistance to rent alternate housing accommodations or necessary 
expenses for individuals with disabilities. 42 U.S.C. 5174(h).\7\ The 
Federal cost-share under IA is 100 percent for HA and 75 percent for 
ONA (with the State responsible for the 25 percent non-Federal share). 
42 U.S.C. 5174(g).
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    \6\ See 88 FR 72520, Oct. 20, 2023. Section 408 caps the amount 
of assistance individuals may receive under IA for HA to $25,000 and 
for ONA to $25,000. These caps are adjusted annually to reflect 
changes in the Consumer Price Index for All Urban Consumers (CPI-U) 
published by the Department of Labor.
    \7\ DRRA amended this section to exclude financial housing 
assistance and necessary expenses for individuals with disabilities 
from those caps.
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    FEMA may only provide housing assistance for a period not to exceed 
18 months from the date of the major disaster declaration, although it 
may extend this period of assistance if it determines that due to 
extraordinary circumstances an extension would be in the public 
interest. 42 U.S.C. 5174(c)(1)(B)(iii); 44 CFR 206.110(e). FEMA is 
required to ensure it has systems in place to allow it to verify the 
identity and address of recipients for assistance, minimize the risk of 
making duplicate or fraudulent payments, collect any duplicate 
payments, provide instructions to individuals detailing the proper use 
of assistance, and conduct an expedited and simplified review and 
appeal process for individuals denied assistance. 42 U.S.C. 5174(i).
    FEMA is required to ensure that the disaster assistance it provides 
is not a duplication of benefits with any other program or from 
insurance or any other source. 42 U.S.C. 5155(a). FEMA has set forth a 
regulatory delivery sequence at 44 CFR 206.191(d) which was further 
clarified in its Individual Assistance Program and Policy Guide (IAPPG) 
\8\ to establish the order in which disaster relief agencies and 
organizations provide assistance to disaster survivors and ensure its 
assistance does not result in a prohibited duplication of benefits. 
Currently, the delivery sequence is, in order of delivery: (i) 
Volunteer Agencies and Mass Care; (ii) Insurance; (iii) FEMA Housing 
Assistance; \9\ (iv) FEMA/State/Territory/Tribal Government ONA; \10\ 
(v) SBA Income Evaluation (Repayment Capability) which will either 
result in an SBA referral or FEMA/State ONA; \11\ and (vi) Unmet 
Needs--Volunteer Agencies.\12\
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    \8\ See page 10 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \9\ This includes both financial and direct Housing Assistance. 
For financial, this encompasses Lodging Expense Reimbursement, 
Rental Assistance, Repair Assistance, and Replacement Assistance, 
and for direct, this includes Multifamily Lease and Repair, 
Transportable Temporary Housing Units, Direct Lease, and Permanent 
Housing Construction.
    \10\ This includes the following types of non-SBA-dependent ONA: 
Funeral Assistance, Medical and Dental Assistance, Child Care 
Assistance, Moving and Storage Assistance, Assistance for 
Miscellaneous Items, and, under this rule, Critical Needs Assistance 
and Clean and Sanitize Assistance.
    \11\ SBA-dependent ONA includes Personal Property Assistance, 
Transportation Assistance, and Group Flood Insurance Policy.
    \12\ See page 10 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
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B. Impacts of Climate Change on Disaster Assistance

    Climate change--changes in the average or variability of weather 
conditions that persist over long time scales (e.g., multiple decades 
or longer) \13\--and related global changes can threaten human health; 
the economy; the built environment; and the natural world, including 
wildlife, plants, and the ecosystems upon which they rely.\14\ Many 
scientists, governments, and organizations have researched climate 
change, documented its experienced effects, projected potential 
effects, and undertaken activities to respond to it.\15\ Scientists 
have demonstrated the effects of climate change are already realized 
around the world, and they project that climate changes will intensify 
in future decades.\16\
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    \13\ C.R.S. Rep 46694, Climate Change Adaptation: Department of 
the Interior, at 1 (2021) available at https://crsreports.congress.gov/product/pdf/R/R46694; for example, see 
definitions of climate and climate change at U.S. Global Change 
Research Program (USGCRP), ``Glossary,'' at https://www.globalchange.gov/climate-change/glossary, and Intergovernmental 
Panel on Climate Change, ``Definition of Terms Used Within the Data 
Distribution Centre: Glossary,'' at https://www.ipcc-data.org/guidelines/pages/glossary/glossary_c.html. This report does not 
address the causes of multidecadal climate change. For a discussion 
of climate change science, see CRS Report R43229, Climate Change 
Science: Key Points, by Jane A. Leggett. For additional background 
on climate change, see CRS In Focus IF11446, Weather and Climate 
Change: What's the Difference? by Jane A. Leggett.
    \14\ Alexa Jay et al., ``Overview,'' in Impacts, Risks, and 
Adaptation in the United States: Fourth National Climate Assessment, 
vol. II, eds. David Reidmiller et al. (Washington, DC: U.S. USGCRP, 
2018), pp. 33-71 (hereinafter, assessment cited as Reidmiller et 
al., Impacts, Risks, and Adaptation).
    \15\ For example, the USGCRP is a Federal program mandated by 
Congress through P.L. 101-606 with the stated purpose of developing 
and coordinating ``a comprehensive and integrated United States 
research program which will assist the Nation and the world to 
understand, assess, predict, and respond to human-induced and 
natural processes of global change.'' For more information, see 
USGCRP, ``About USCGRP,'' at https://www.globalchange.gov/about. The 
IPCC ``is the United Nations body for assessing the science related 
to climate change'' (IPCC, ``About the IPCC,'' at https://www.ipcc.ch/about/).
    \16\ For example, see IPCC, ``Synthesis Report of the IPCC Sixth 
Assessment Report (AR6), Summary for Policymakers'' at 4-6, 12-13 
(Mar. 20, 2023), https://www.ipcc.ch/report/sixth-assessment-report-cycle/; Economic Report of the President at 275, 280, 282-84 (March 
2023), https://www.whitehouse.gov/wp-content/uploads/2023/03/ERP-2023.pdf.
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    The issue of climate change impacts and implementing solutions is 
incredibly challenging and complex. Climate change poses a direct 
threat to the security of our Nation in the form of increasingly severe 
and unpredictable storms, flooding, and wildfires that 
disproportionately impact some of

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America's most vulnerable communities.\17\ Climate change disasters, 
such as heatwaves, can take place over longer time scales or broader 
geographic areas than other more acute disruptions. Other impacts, such 
as ``nuisance flooding'' are less intense but more chronic. This 
requires us to think differently about emergency response.\18\
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    \17\ Fourth National Climate Assessment, Volume II: Impacts, 
Risks, and Adaptation in the United States, https://nca2018.globalchange.gov/#sf-2.
    \18\ DHS Strategic Framework for Addressing Climate Change (Oct. 
21, 2021), https://www.dhs.gov/sites/default/files/publications/dhs_strategic_framework_10.20.21_final_508.pdf.
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    The Nation is no stranger to historic and costly hurricane seasons. 
The 2017 Atlantic hurricane season was one of the most active in U.S. 
history; between April and November, there were 17 named storms, with 
10 becoming hurricanes.\19\ As of October 9, 2017, FEMA received more 
applications for the Individuals and Households Program than in 
hurricanes Katrina, Rita, Wilma and Sandy combined. By November 30, 
2017, FEMA registered more than 4.7 million households for the 
Individuals and Households Program.\20\ These hurricanes were 
accompanied by devastating wildfires in California that burned for 
months. The President's 2023 Economic Report \21\ recounts that 
Hurricane Ian struck Florida in September 2022, causing a coastal storm 
surge of up to 18 feet and widespread inland flooding; it will end up 
being one of the costliest storms on record, with losses to residential 
and commercial property estimated at between $36 billion and $62 
billion.\22\ Climate change has elevated the need for the delivery of 
efficient disaster services and increased the need for IHP assistance, 
particularly for socially vulnerable populations, which are 
disproportionately impacted.\23\ In response and in a step towards 
equity, the regulatory changes in this rule seek to add efficiency in 
the delivery of assistance to survivors by simplifying processes, 
removing barriers to entry, and increasing eligibility for certain 
types of assistance under the program. For example, the changes seek to 
streamline documentation requirements, thus easing entry into the 
Individuals and Households Program. Each regulatory change to follow is 
influenced by the growing emergency needs of citizens across the 
Nation, which has meant the trend of growing FEMA participation and 
responsibility for response.
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    \19\ 2017 Hurricane Seasons FEMA After-Action Report, at v (July 
12, 2018), 2017 Hurricane Season FEMA After-Action Report.
    \20\ 2017 Hurricane Seasons FEMA After-Action Report, at 39 
(July 12, 2018), 2017 Hurricane Season FEMA After-Action Report.
    \21\ See Economic Report of the President at 282 (March 2023), 
https://www.whitehouse.gov/wp-content/uploads/2023/03/ERP-2023.pdf.
    \22\ CoreLogic, ``CoreLogic Analysis Shows Final Estimated 
Insured and Uninsured Damages for Hurricane Ian to Be Between $41 
Billion and $70 Billion'' (2022), www.corelogic.com/press-releases/corelogic-analysis-shows-final-estimated-insured-and-uninsured-damages-for-hurricane-ian-to-be-between-41-billion-and-70-billion/. 
Paquette, D., and M. Kornfield, ``Ian Is Florida's Deadliest 
Hurricane Since 1935; Most Victims Drowned'' (Oct. 5, 2022), https://www.washingtonpost.com/nation/2022/10/05/hurricane-ian-florida-victims/.
    \23\ See, e.g., EPA, Climate Change and Social Vulnerability in 
the United States: A Focus on Six Impacts, (September 2021), https://www.epa.gov/cira/social-vulnerability-report. The EPA's report 
analyzed four socially vulnerable groups: low income, minority, no 
high school diploma, and 65 or older. See Id. at 4, Table ES.1--
Socially Vulnerable Groups Analyzed in this Report.
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    Presently coastal areas globally face land loss, repeat flooding, 
and storm surges, affecting coastal populations.\24\ Extreme weather 
events are increasing in intensity as well as frequency.\25\ Sustained 
changes in climate have exacerbated the physical risks and threats 
coastal communities are exposed to every day.
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    \24\ Maldonado, J., Wang, I.F.C., Eningowuk, F. et al. 
Addressing the challenges of climate-driven community-led 
resettlement and site expansion: knowledge sharing, storytelling, 
healing, and collaborative coalition building, J Environ Stud Sci 
11, 294-304 (2021), https://doi.org/10.1007/s13412-021-00695-0.
    \25\ Maldonado, J., Wang, I.F.C., Eningowuk, F. et al, 
Addressing the challenges of climate-driven. community-led 
resettlement and site expansion: knowledge sharing, storytelling, 
healing, and collaborative coalition building, J Environ Stud Sci 
11, 294-304 (2021), https://doi.org/10.1007/s13412-021-00695-0.
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    As climate change threatens to bring more extreme events like 
increased floods, sea level rise, and intensifying droughts and 
wildfires, is our responsibility to better prepare and support 
communities, families, and businesses before, during, and after 
disasters. Here, in light of the increasing climate-related disasters 
facing the Nation, FEMA issues amendments to the Individuals and 
Households Program to ensure that it meets the increasing need for 
assistance to individuals and families recovering from disasters.

C. Equity in Individual Assistance

1. Income Project
    There have been numerous assertions over the years that IHP 
disproportionately benefits higher income households over lower income 
households.\26\ In 2019, FEMA undertook an analysis to determine if 
this was true (Income Project).\27\ FEMA analyzed 5 years of disaster 
data (January 1, 2014-December 31, 2018) which comprised 4.8 million 
registrations.
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    \26\ See The Hill, Disaster Housing Recovery: Time for Congress 
to Act (November, 26, 2018) (``FEMA consistently creates barriers 
that prevent low-income people from receiving assistance . . . FEMA 
is unwilling and incapable of handling the housing needs of low-
income disaster survivors,'') https://thehill.com/opinion/civil-rights/418175-disaster-housing-recovery-time-for-congress-to-act 
(last visited Nov. 29, 2021); Texas Housers, Low-income Households 
Disproportionately Denied by FEMA is a Sign of a System that is 
Failing the Most Vulnerable (November 30, 2018) (``Homeowner 
households with fewer financial resources were more likely to be 
denied FEMA assistance after Harvey,'') https://texashousers.org/2018/11/30/low-income-households-disproportionately-denied-by-fema-is-a-sign-of-a-system-that-is-failing-the-most-vulnerable/ (last 
visited Nov. 29, 2021); NPR, How Federal Disaster Money Favors the 
Rich (March 5, 2019) (``Disasters, and the federal aid that follows, 
disproportionately benefit wealthier Americans'') https://www.npr.org/2019/03/05/688786177/how-federal-disaster-money-favors-the-rich (last visited Nov. 29, 2021).
    \27\ FEMA, Individuals & Households Program Survivor Income 
Analysis (2019) and Survivor Income Analysis: Phase 2--Drivers of 
variance in IHP assistance across income groups (2019). See 
Supporting & Related Material tab on www.regulations.gov under 
Docket ID: FEMA-2023-0003.
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    In July 2019, FEMA completed Phase 1 of the project.\28\ Phase 1 
results showed that of the FEMA registrants during that time period, 62 
percent were ``lower income,'' 10 percent were ``middle income,'' and 
28 percent were ``higher income.'' \29\ FEMA concluded generally that 
lower income households were more likely to receive an award, or, in 
other words, have a higher award rate under the Individuals and 
Households Program, but that the average award amount was lower for 
those households than for higher income households.
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    \28\ For Phase 1 of the Income Project, the average repair/
replacement award size for lower income owners is $2,165 while the 
average award size for higher income owners is $4,139. For Personal 
Property Assistance, the average award size for lower income owners 
is $819, while the average award size for higher income owners 
$2,093. For Personal Property Assistance, the average award size for 
lower income renters is $900, while the average award size for 
higher income renters is $2,110.
    \29\ FEMA, Individuals & Households Program Survivor Income 
Analysis (2019) and Survivor Income Analysis: Phase 2--Drivers of 
variance in IHP assistance across income groups (2019). See 
Supporting & Related Material tab on www.regulations.gov under 
Docket ID: FEMA-2023-0003. FEMA defines Lower income as a 
combination of low, very low, and extremely low-income. As defined 
by HUD, Extremely Low income means Income at or below the national 
poverty threshold or 30% of the Area Median Income, whichever is 
less; Very Low income means Income between >30% and 50% of AMI; and 
Low Income means Income between >50% and 80% of AMI. (See Page 5 of 
the Income Analysis).
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    The data proved to be more varied at the assistance type level. 
FEMA compared the rate of applicants referred to IHP for further 
consideration,\30\ award

[[Page 3994]]

rates, and award amounts of lower income households to higher income 
households for home repair/replacement financial assistance, rental 
housing financial assistance, personal property financial assistance, 
direct housing assistance, and transitional shelter assistance.
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    \30\ The term ``referred to IHP'' reflects terminology FEMA uses 
in the implementation of IHP. Applicants fill out registrations and 
their answers will determine some threshold eligibility factors and 
what types of assistance they may need or what unmet needs they 
have. At that point, the eligible applications are routed to the 
FEMA employees who process each type of assistance to make further 
eligibility determinations.
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    The data received indicates that lower income households were 
referred for assistance at a higher rate than were higher income 
households for all types of assistance except direct housing but were 
awarded assistance in lower amounts for repair and replacement 
assistance and personal property. Specifically, FEMA found the 
following:
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    \31\ This represents ``10 times'' or ``10x more likely'' when it 
comes to personal property referrals for lower income applicants.
    \32\ The original analysis did not include a specific breakdown 
for Transitional Sheltering Assistance (TSA) referral rates, but 
FEMA believes the rate to be in line with referral rates for non-
lower-income TSA applicants.
[GRAPHIC] [TIFF OMITTED] TR22JA24.000

    In November 2019, FEMA completed Phase 2 of the project in which it 
focused on additional analysis of the data to determine the cause of 
the variance in results between lower and higher income applicants. 
FEMA found that: (1) higher income households were less likely to 
receive an award for home repair/replacement assistance because they 
were more likely to have insurance which covered their losses; (2) 
lower income households received lower award amounts for home repair/
replacement because they had lower Real Property FEMA Verified Loss 
(RPFVL),\33\ smaller homes, and were more likely to live in mobile 
homes which may be smaller or less expensive than non-mobile homes; (3) 
lower income households were less likely to receive an award for rental 
assistance because they were more likely to be found ineligible as a 
result of their home being habitable than higher income households; (4) 
lower income households were less likely to be eligible for personal 
property assistance, but the results were inconclusive and FEMA could 
not identify the primary driver of the difference; (5) lower income 
households were likely to have a lower award amount for personal 
property assistance but FEMA could not account for the reason why, 
although home size might be a factor; and (6) using a RPFVL per square 
foot threshold instead of a flat RPFVL threshold for direct housing 
would increase the proportion of lower income owners and decrease the 
proportion of higher income owners who qualified for direct 
housing.\34\
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    \33\ RPFVL is the total dollar amount of IHP eligible disaster-
caused damage to real property as verified by FEMA.
    \34\ For more information on FEMA's Direct Housing Assistance 
see page 93 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
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2. Equity RFI--IA Program Equity Responses to Comments
    On January 20, 2021, President Joseph R. Biden signed Executive 
Order 13985, ``Advancing Racial Equity and Support for Underserved 
Communities \35\ Through the Federal Government.'' \36\ On January 20, 
2021, President Joseph R. Biden signed Executive Order 13990, 
``Protecting Public Health and the Environment and Restoring Science To 
Tackle the Climate Crisis.'' \37\ On January 27, 2021, President Joseph 
R. Biden signed Executive Order 14008, ``Tackling the Climate Crisis at 
Home and Abroad.'' \38\ And, on February 16, 2023, President Joseph R. 
Biden signed Executive Order 14091, ``Further Advancing Racial Equity 
and Support for Underserved Communities Through the Federal 
Government.'' \39\
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    \35\ Section 2.b. of Executive Order 13985 defines ``underserved 
communities'' as populations sharing a particular characteristic, as 
well as geographic communities, that have been systematically denied 
a full opportunity to participate in aspects of economic, social, 
and civic life, as exemplified by the list in the definition of 
``equity.'' Section 10.a. of Executive Order 14091 defines 
``equity'' to mean the consistent and systematic treatment of all 
individuals in a fair, just, and impartial manner, including 
individuals who belong to communities that often have been denied 
such treatment, such as Black, Latino, Indigenous and Native 
American, Asian American, Native Hawaiian, and Pacific Islander 
persons and other persons of color; members of religious minorities; 
women and girls; LGBTQI+ persons; persons with disabilities; persons 
who live in rural areas; persons who live in United States 
Territories; persons otherwise adversely affected by persistent 
poverty or inequality; and individuals who belong to multiple such 
communities.
    \36\ E.O. 13985, ``Advancing Racial Equity and Support for 
Underserved Communities Through the Federal Government,'' 86 FR 
7009, Jan. 25, 2021.
    \37\ E.O. 13990, ``Protecting Public Health and the Environment 
and Restoring Science to Tackle the Climate Crisis,'' 86 FR 7037, 
Jan. 25, 2021.
    \38\ E.O. 14008, ``Tackling the Climate Crisis at Home and 
Abroad,'' 86 FR 7619, Feb. 1, 2021.
    \39\ E.O. 14091, ``Further Advancing Racial Equity and Support 
for Underserved Communities Through the Federal Government.''88 FR 
10825, Feb. 22, 2023.
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    Consistent with those Executive Orders and to gain additional 
information on the issues identified in the 2019 income project, on 
April 22, 2021, FEMA published a Request for Information (RFI) on FEMA 
Programs, Regulations, and Policies.\40\ FEMA sought public input on 
its programs, regulations, collections of information, and policies for 
the agency to ensure that its programs, regulations, and policies 
contain necessary, properly tailored, and up-to-date requirements that 
effectively achieve FEMA's mission in a manner that furthers the goals 
of advancing equity for all, including those in underserved 
communities; bolstering resilience from the impacts of climate change, 
particularly for those disproportionately impacted by climate change; 
and environmental justice.
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    \40\ 86 FR 21325, Apr. 22, 2021.
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    FEMA held public meetings and extended the comment period on the 
RFI to ensure all interested parties had sufficient opportunity to 
provide comments on FEMA's programs.\41\ All relevant comments received 
in response to the request for information, including those received 
during the public

[[Page 3995]]

meetings, have been posted to the public rulemaking docket on the 
Federal eRulemaking portal at https://www.regulations.gov/document/FEMA-2021-0011-0001/comment.
---------------------------------------------------------------------------

    \41\ See ``Request for Information on FEMA Programs, 
Regulations, and Policies; Public Meetings; Extension of Comment 
Period,'' 86 FR 30326, June 7, 2021.
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    Comments on the RFI that are relevant to the IHP issues addressed 
in this rule are discussed below. Comments regarding other IA programs 
outside of IHP, such as Disaster Legal Services, other FEMA program 
areas, such as Public Assistance, or that were otherwise not directly 
relevant to this rule, are not discussed.
Registration Period
    A few commenters raised issues regarding the registration deadline 
for FEMA programs, arguing that the current deadline posed difficulties 
for applicants--particularly for applicants from underserved 
populations--and should be extended.\42\ One commenter stated 
applicants may have a wide variety of valid reasons for registering 
late and that requiring documentation to justify the late filing is 
inappropriate and unnecessary.\43\ This commenter requested all 
registrations received during the post-deadline grace period be 
accepted without additional documentation.\44\ Another commenter 
recommended removing the registration deadline altogether, saying that 
it was arbitrary and discouraged disaster survivors from 
registering.\45\ This commenter also noted that disaster survivors may 
not realize they need assistance immediately and that even once they 
do, it may be difficult for them to meet the registration deadlines due 
to the impacts of a disaster, such as being displaced or losing 
telephone service. Finally, this commenter argued that FEMA should not 
impose a registration deadline that ends before the period of 
assistance for the disaster ends.
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    \42\ FEMA-2021-0011-0149, FEMA-2021-0011-0236, FEMA-2021-0011-
0277, and FEMA-2021-0011-0295.
    \43\ FEMA-2021-0011-0149.
    \44\ The commenter referred to a 30-day grace period after the 
registration period, but as described below, FEMA actually accepts 
late applications for 60 days following the close of the 
registration period.
    \45\ FEMA-2021-0011-0295.
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    We do not agree that a registration deadline discourages disaster 
survivors from registering. Rather, it provides clear submission 
timeframes to help disaster applicants.
    FEMA's regulations, at 44 CFR 206.112, provide that the standard 
registration period is 60 days following the date that the President 
declares an incident a major disaster or an emergency. FEMA may extend 
the registration period when the State \46\ requests more time to 
collect registrations from the affected population. FEMA may also 
extend the standard registration period when necessary to establish the 
same registration deadline for contiguous counties or States. After the 
standard or extended registration period ends, FEMA accepts late 
registrations for an additional 60 days. FEMA processed late 
registrations for registrants that provided suitable documentation \47\ 
to support and justify the reason for the delay in their registration.
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    \46\ To improve readability, the term ``State'' will be used in 
this rule to refer to State, Tribal, and Territorial governments, as 
applicable. Where there are relevant differences in how these 
governments are treated under the Stafford Act or FEMA's 
regulations, they will be explained in more detail.
    \47\ Page 71 of IAPPG 1.1 discusses late applications and the 
types of acceptable information FEMA required in order for the late 
application to be considered. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    FEMA required the applicant to submit a letter, signed by the 
applicant or person who the applicant authorizes to act on their 
behalf, explaining the extenuating circumstances that prevented them 
from applying for assistance in a timely manner. Acceptable 
documentation included record of hospitalization, illness, or 
disability of the applicant or an immediate family member; record of 
death for an immediate family member; or proof of personal or business 
travel that kept the applicant out of the area for the full 
registration period.\48\
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    \48\ See page 71 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Based on comments indicating that the level of documentation 
required to justify a late application is inappropriate and 
unnecessary, FEMA is removing the requirement to provide documentation. 
FEMA agrees that the late application process should be simplified to 
reduce the burden on disaster survivors. Therefore, under this rule, 
FEMA will only require that registrants explain the reason for the 
delay. This change is discussed in more detail in the section-by-
section analysis, below.
    FEMA believes these changes are needed to the current regulations 
to allow individual applicants to more easily submit a late 
application, but the regulations are generally sufficient to ensure the 
majority of disaster survivors have an adequate opportunity to register 
for assistance during the registration period. FEMA reaches out to 
survivors and communities after disasters using multiple tools, teams, 
and tactics to help applicants register for assistance, to include 
placing staff who can register applicants in disaster impacted areas 
and shelters.\49\ Although disaster survivors may face a range of 
challenges in applying for assistance, the initial 60-day period is 
generally sufficient for most disasters, and for those specific 
disasters where there may be additional difficulties with timely 
filing, FEMA may extend the period. Increasing the default registration 
period or removing limits on registration altogether could lead to more 
applicants filing late, slowing the delivery of assistance, and 
increasing the administrative burden for FEMA in processing those 
applications.\50\ The flexibility to extend the registration period on 
a disaster-by-disaster basis as appropriate allows FEMA to avoid 
unnecessary delays in program administration while still giving 
applicants additional time when needed, is why the registration period 
is not arbitrary.
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    \49\ For more information see FEMA in the Field: Disaster 
Survivor Assistance and Disaster Recovery Centers, https://www.fema.gov/fact-sheet/fema-field-disaster-survivor-assistance-and-disaster-recovery-centers. FEMA currently provides letters in 
English and Spanish. FEMA recently updated our English and Spanish 
letters to include a tagline in six languages informing applicants 
how to contact the Helpline for translation help. The six languages 
are: English, Spanish, Russian, Portuguese, Vietnamese, and Korean. 
FEMA knows which language to provide letters in based on the 
language that the Disaster Survivor selected on their Disaster 
Assistance Registration.
    \50\ In response to a disaster declaration, FEMA scales up its 
resources including individuals working the FEMA Helpline, 
inspectors deploying to the field to conduct damage assessments, and 
staff deploying to the field to assist the Region and State in 
disaster recovery. Often, these individuals will staff Disaster 
Recovery Centers (DRCs), which are locations where individuals may 
register for assistance, ask questions about their application, 
provide documentation, etc. to FEMA or other government 
representatives in person. Removing a registration timeframe or 
increasing it beyond the current periods established in the 
regulations would increase the amount of time staff would need to be 
deployed in these various roles.
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    Data shows that over the last 10 years, the registration period was 
extended past the initial 60 days authorized in 44 CFR 206.112(a) in 42 
percent of Individual Assistance (IA) declarations. In 44 CFR 
206.112(b), FEMA still retains the ability to extend the registration 
period on an as-needed basis. FEMA, in coordination with a State, 
Tribal, or Territorial (STT) government, can extend the registration 
period when there are wide-spread obstacles that may delay or impede 
disaster survivors' ability to register, while maintaining the 
authority to accept late registrations from disaster survivors who may 
have specific, individual circumstances that impact their opportunity 
to register.

[[Page 3996]]

Accessibility, Language Access, and Effective Communication With People 
With Disabilities
    Numerous commenters provided general statements about improving 
applicant access to FEMA assistance and the necessity for improving 
FEMA staff training to assist with language and accessibility needs 
across programs. Eight of these comments raised concerns about 
applicant accessibility within FEMA's IHP. Five commenters reasoned 
that FEMA must improve its communication access for applicants who have 
a primary language other than English with Limited English Proficiency 
(LEP),\51\ as well as applicants with low-literacy and those with a 
disability who use another form of communication (e.g., American Sign 
Language). These commenters stated that FEMA must provide effective 
translation or local FEMA employees that speak the applicant's language 
and can effectively explain the IHP process, as well as provide 
multilingual staff that can answer applicant questions during 
inspections, throughout registration intake, and in-person at DRCs.
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    \51\ FEMA-2021-0011-0149, FEMA-2021-001-0164, FEMA-2021-0011-
0261, FEMA-2021-0011-0282, and FEMA-2021-0011-0313.
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    Five commenters questioned FEMA's ability to adequately identify 
and meet the reasonable accommodation and reasonable modification needs 
of applicants with disabilities across the IHP service delivery 
process.\52\ These commenters reasoned that FEMA failed to establish a 
clear and transparent public process for survivors to request 
reasonable accommodations and reasonable modifications. One commenter 
stated that even if a disaster survivor has requested an accommodation 
or a modification, FEMA has no system to indicate that they are a 
survivor with a disability or that they need an accommodation or a 
modification other than another undifferentiated note in their 
file.\53\ Commenters explained that, consequently, these requests do 
not automatically populate across IHP, so FEMA staff are often unaware 
of an applicant's previously documented accommodation, modification, or 
access need. They argued that this lack of planning and transparency 
denies meaningful access to survivors with disabilities and inhibits 
their ability to access reasonable accommodations and reasonable 
modifications within all aspects of IHP.
---------------------------------------------------------------------------

    \52\ FEMA-2021-0011-0152, FEMA-2021-0011-0164, FEMA-2021-0011-
0167, FEMA-2021-0011-0205, and FEMA-2021-0011-0313.
    \53\ FEMA-2021-0011-0152.
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    Two commenters stated that IHP did not provide allowances for the 
inclusion of accessibility-related items for pre-existing or disaster 
acquired disabilities. These commenters asserted that disaster 
survivors with physical disabilities who require accommodations or 
modifications to access their home in the wake of a disaster should 
receive timely assistance to repair their homes.\54\ Two commenters 
further explained that FEMA's habitability standards are inequitable 
and deny IHP assistance to applicants with disabilities and survivors 
who have low income, especially for applicants within these underserved 
groups who also have underlying health conditions. These commenters 
asserted that a habitability standard which assumes that what is safe 
to occupy for one person is safe to occupy for another person is wrong. 
They explained that because IHP policy has not considered the presence 
of mold a condition that would prevent an applicant from occupying a 
home safely, applicants with immunocompromised health conditions such 
as asthma, cancer, or sickle cell disease, for whom it was unsafe to 
live in a home with mold, were routinely denied assistance.\55\
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    \54\ FEMA-2021-0011-0164 and FEMA-2021-0011-0261.
    \55\ FEMA-2021-0011-0152 and FEMA-2021-0011-0164.
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    FEMA acknowledges that voluntary agencies and community 
organizations are the first and last organizations to provide survivors 
support services in a community before and after a disaster. Therefore, 
FEMA's Voluntary Agency Coordination Section provides technical 
assistance, coordination, and subject matter expertise to partners who 
are addressing gaps in resources, providing financial support and 
additional support to survivors after government assistance is 
exhausted. This assistance is provided via FEMA's Voluntary Agency 
Liaison (VAL) staff. The function of the VALs is to coordinate 
voluntary activities between internal FEMA partners, local, State, and 
Federal Government entities and State and National Voluntary 
Organizations Active in Disaster; to support and build the capability 
of disaster recovery for current and future disasters; and to support 
ongoing community recovery activities even after the period of 
assistance has ended. VALs work directly with IA staff to ensure that 
all disaster survivors to include those with LEP are informed of FEMA 
assistance.
    FEMA has many ways to meet survivors' language needs. Many FEMA 
employees are bilingual or multilingual and can assist LEP survivors 
with registration in their primary language by phone and in-person at a 
DRC. All DRCs have a sign posted in a visible location with the phrase 
``If you do not speak English'' in over 40 languages. A DRC staff 
member will use that sign to determine what language the survivor 
speaks and call for an interpreter to assist them.
    If an in-person interpreter is not present at the DRC, FEMA staff 
will connect the survivor with the FEMA Helpline or video relay service 
so the survivor is able to communicate with the FEMA employee 
accurately. FEMA's Helpline has interpretation services provided by 
qualified interpreters available in 250 languages to assist LEP 
disaster survivors.
    FEMA recognizes that an applicant's ability to effectively 
communicate their reasonable accommodation or reasonable modification 
request is essential. To improve FEMA's ability to assist applicants 
with disabilities with requesting and receiving reasonable 
accommodations and reasonable modifications during registration, FEMA 
recently updated its registration process to better capture 
accommodations, modifications, and access assistance needs for 
applicants and their household members. Specifically, FEMA added 
questions to the Disaster Assistance Registration forms to provide 
applicants with an opportunity to consider, document and differentiate 
their household's pre-disaster and disaster-caused accommodation or 
modification requests and access needs. FEMA uses responses to 
registration questions to provide reasonable accommodations, reasonable 
modifications, and assistance to applicants throughout the IHP process. 
These questions include whether the applicant has a disability or 
language need that requires an accommodation or modification, or 
interpretation or translation services to interact with FEMA staff and/
or access FEMA programs; if the applicant or anyone in their household 
has a disability that affects their ability to perform daily living 
activities or requires an assistive device; and whether they have any 
disability-related assistive devices or medically required equipment/
supplies/support services damaged, destroyed, lost, or disrupted 
because of the disaster.\56\
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    \56\ This rulemaking clarifies that ONA includes medical service 
costs for the loss or injury of a service animal. See new 44 CFR 
206.119(b)(3)(iv).

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[[Page 3997]]

    FEMA recently completed system updates with the new question in 
2018 to ensure information provided in response to these questions at 
registration or provided to staff at other times are captured and 
easily accessible to all staff in a consistent area in the system. FEMA 
is also performing additional outreach to applicants with disabilities 
and language access needs to assist them in understanding any 
correspondence FEMA provides to them.\57\ Applicants who state they 
have a disability during the registration process are placed in a 
prioritization queue and, if later determined ineligible for FEMA 
assistance, will be contacted via phone to explain their ineligibility. 
The field will also conduct their own outreach via phone to applicants 
with access and functional needs. FEMA continues to explore new methods 
and processes for documenting and populating reasonable accommodation 
and reasonable modification requests across the IHP. Lastly, in this 
rule, FEMA is revising the IHP Application for Continued Temporary 
Housing Assistance, FEMA Form FF-104-FY-21-115, to include a question 
that provides applicants with another opportunity to identify any 
disability-related household needs that might impact their application 
or recertification for temporary housing assistance.
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    \57\ FEMA currently provides letters in English and Spanish. 
FEMA recently updated our English and Spanish letters to include a 
tagline in six languages informing applicants how to contact the 
Helpline for translation help. The six languages are: English, 
Spanish, Russian, Portuguese, Vietnamese, and Korean.
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    As noted in the IAPPG 1.1, FEMA may provide Home Repair Assistance 
and Personal Property Assistance for disaster-damaged accessibility-
related items. Nevertheless, in response to public requests for IHP 
policy that meets applicants' disaster-caused structural home 
modification needs, FEMA recently amended its policy to include 
Assistance for Disaster-Caused Americans with Disabilities Act (ADA) 
Real Property Needs. The September 2, 2021, Amendment to FEMA Policy 
(FP) 104-009-03, Individual Assistance Program and Policy Guide 
(IAPPG), Version 1.1 memorandum currently allows FEMA to provide 
financial assistance to applicants who incur a disaster-caused 
disability and consequently require the installation or construction of 
accessibility-related real property components at their damaged 
dwelling to meet their needs. Home Repair Assistance for specific 
accessibility-related items is not limited by a financial maximum 
award. The following accessibility-related items are currently eligible 
under Home Repair Assistance when the applicant or a member of the 
household has a disaster-caused disability:
     Exterior ramp.
     Grab bars.
     Paved path of travel to the primary residential entrance 
(for accessible ingress or egress from the applicant's vehicle to their 
dwelling).
    In response to public comments, FEMA is also making changes to the 
regulatory text at 44 CFR 206.117(b)(2) and adding a new 44 CFR 
206.113(a)(9) as a part of this rule. The changes allow FEMA 
flexibility to provide financial assistance to applicants for the 
installation or construction of real property items that were not 
present in the home prior to the disaster. Specifically, these changes 
allow IHP to expand its existing policy, which provides for the 
installation of ADA related real property to applicants with disaster-
caused needs, to include Home Repair Assistance for disaster survivors 
with pre-existing, pre-disaster needs for accessibility-related items, 
such as an exterior ramp, grab bars, etc., that make their home safe 
and functional when any level of disaster-caused real property damage 
occurs to the primary residence.
    In new 44 CFR 206.113(a)(9), FEMA states that FEMA may provide 
assistance with respect to home repair for accessibility-related items, 
if an applicant meets the following conditions: (i) the applicant is 
either an individual with a disability as defined in 42 U.S.C. 5122 
whose disability existed prior to the disaster \58\ and whose primary 
residence was damaged by the disaster, or an individual with a 
disability as defined in 42 U.S.C. 5122 whose disability was caused by 
the disaster and whose primary residence was damaged by the disaster; 
(ii) the real property component is necessary to meet the 
accessibility-related need of the household; and (iii) the real 
property component is not covered by insurance or any other source.
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    \58\ FEMA generally will accept statements from relevant medical 
providers, such as physical therapists, occupational therapists, 
registered nurses, physician assistants, etc.
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    Via information collection at 1660-0002, we are adding a 
documentation requirement to tie the need for the home repair 
accessibility-related items (which currently includes only ramp, grab 
bars, and/or paved pathway) to the pre-existing disability to meet the 
household's access and functional need. We are requiring that a 
medical, health care, or rehabilitation professional certify whether or 
not this is necessary; as, they have the expertise to make that 
determination or we will accept prior medical, health care, or 
rehabilitation professional documentation that supports the need for 
the accessibility-related items.
    FEMA is making the below changes to Home Repair Assistance to 
respond to four RFI comments,\59\ so that FEMA may make the dwelling 
safe/sanitary for pre-disaster disabled applicants. For example, this 
change will allow FEMA to reimburse pre-disaster disabled applicants 
for installation of accessibility items, such as grab bars and access 
ramps, if the primary residence sustained disaster damage regardless of 
whether or not the applicant had grab bars or access ramps pre-
disaster.\60\
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    \59\ FEMA-2021-0011-0152, FEMA-2021-0011-0164, FEMA-2021-0011-
0235, and FEMA-2021-0011-0261.
    \60\ If the FEMA assistance provided for these items is less 
than the actual cost to the applicant, the applicant may appeal for 
additional assistance. FEMA will accept itemized bills, receipts, or 
estimates to verify that there is a need for additional assistance.
---------------------------------------------------------------------------

    In 44 CFR 206.117(b)(2)(i), FEMA states that FEMA may provide 
financial assistance for the repair of an owner-occupied primary 
residence if: the eligibility criteria in 44 CFR 206.113 are met; FEMA 
determines the dwelling was damaged by the disaster; and the damage is 
not covered by insurance. This provision is similar to the current 44 
CFR 206.117(b)(2)(i), except FEMA is removing the phrase ``real 
property components in'' before ``an owner-occupied primary 
residence;'' adding ``FEMA determines'' after ``met;'' removing ``to 
the component'' after ``damage'' and replacing ``component'' with 
``dwelling,'' as the Stafford Act does not limit repairs to 
``components'' and replacing ``owner's'' with ``owner-occupied'' for 
consistency as owner-occupied is the defined term in 44 CFR 206.111; 
removing the current 44 CFR 206.117(b)(2)(i)(B) that ``the component 
was functional immediately before the declared event'' and removing 
current 44 CFR 206.117(b)(2)(i)(E) that ``the repair of the component 
is necessary to ensure the safety or health of the occupant or to make 
the residence functional,'' and removing the clause ``and the damage 
was caused,'' since this rule will allow FEMA to pay for pre-existing 
conditions if the component itself was damaged by the disaster.
    In 44 CFR 206.117(b)(2)(ii), FEMA states that FEMA may provide 
financial assistance for the repair of the disaster damaged dwelling to 
a safe and sanitary living or functioning condition. This

[[Page 3998]]

clause is consistent with the current 44 CFR 206.117(b)(2)(ii), except 
FEMA is adding ``the disaster damaged dwelling to a safe and sanitary 
living or functioning condition including'' after ``of.'' These 
additions align with the changes that make it clear that only disaster 
damaged dwellings (regardless of their pre-disaster condition) may 
receive repair assistance, as FEMA may only pay to restore disaster 
damage to a safe and sanitary living or functioning condition. If the 
dwelling was not touched by the disaster, it will not be eligible for 
repair assistance; therefore, the applicant would not be able to apply 
for Home Repair Assistance for their pre-existing, pre-disaster needs 
for accessibility-related items, such as an exterior ramp, grab bars, 
etc., that would make their home safe and functional.
    The September 2, 2021, Amendment to FEMA Policy (FP) 104-009-03, 
Individual Assistance Program and Policy Guide (IAPPG), Version 1.1 
memorandum also amended the Home Repair Assistance section in IAPPG 1.1 
to include financial assistance to repair real property components 
impacted by disaster-caused mold growth.\61\ The amendment's expressed 
intent was to support low income and other underserved disaster 
survivors who may not have the means to immediately address disaster 
damage, particularly when disasters are not declared immediately or 
inspections are delayed. However, all applicants with disaster-caused 
mold damage may be eligible for the assistance when they meet all other 
conditions of eligibility. These additional funds will be provided as 
part of the Home Repair Assistance award when applicable.
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    \61\ See page 9 of the Amendment to FP 104-009-03, Individual 
Assistance Program and Policy Guide, Version 1.1 memorandum cites to 
Chapter 3, Section IV.E. of the IAPPG 1.1, which is on pages 85-88 
of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
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Appeals
    Sixteen commenters provided responses about the IHP appeal process. 
Ten of the commenters expressed concern that the appeal process is 
burdensome on applicants and must be simpler in order for applicants of 
varying backgrounds and communities to successfully navigate the 
process.\62\ According to 3 of these 10 commenters, filing a successful 
appeal for applicants in traditionally underserved populations often 
requires hard to find or costly access to legal services.\63\ To 
streamline the appeal process and reduce the burden on disaster 
survivors, these commenters suggested FEMA expand methods for filing 
appeals, including by:
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    \62\ FEMA-2021-0011-0151, FEMA-2021-0011-0162, FEMA-2021-0011-
0209, FEMA-2021-0011-0235, FEMA-2021-0011-0237, FEMA-2021-0011-0245, 
FEMA-2021-0011-0260, FEMA-2021-0011-0261, FEMA-2021-0011-0273, and 
FEMA-2021-0011-0292.
    \63\ FEMA-2021-0011-0151, FEMA-2021-0011-0245, and FEMA-2021-
0011-0260.
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     Allowing applicants to file appeals online, by telephone, 
and in-person.\64\
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    \64\ FEMA-2021-0011-0149, FEMA-2021-0011-0261, and FEMA-2021-
0011-0292.
---------------------------------------------------------------------------

     Providing a standard appeal form.\65\
---------------------------------------------------------------------------

    \65\ FEMA-2021-0011-0245.
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     Reaching out directly to applicants by phone to personally 
assist them with the appeal process when they are denied 
assistance.\66\
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    \66\ FEMA-2021-0011-0261.
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     Providing appeal status updates to applicants through 
their online applicant portals.\67\
---------------------------------------------------------------------------

    \67\ FEMA-2021-0011-0149.
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    Two additional commenters described the appeal process as overly 
complicated to navigate because of challenges in other parts of the IHP 
delivery process. Specifically, these commenters asserted that IHP 
eligibility notification letters provided unclear explanations of the 
reason an applicant is determined ineligible for assistance. The 
commenters explained that when applicants are unable to identify and 
understand the cause of their denial for assistance, they lack critical 
information needed to pursue a successful appeal.\68\ Three commenters 
also discussed obstacles disaster survivors face after the trauma of a 
major disaster and recommended that FEMA extend the appeal deadline 
beyond the current 60 days.\69\ Two of these commenters explained that 
by providing applicants with a grace period for establishing ownership 
and addressing other issues that take time to obtain documentation, 
FEMA could improve access to their programs for applicants with low 
income and applicants of color who are disproportionately affected by 
heir-ownership (when a person inherited the land or residence but does 
not hold formal title to it) and other documentation issues.
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    \68\ FEMA-2021-0011-0237 and FEMA-2021-0011-0275.
    \69\ FEMA-2021-0011-0149, FEMA-2021-0011-0208, and FEMA-2021-
0011-0245.
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    Three other commenters argued the need for greater transparency in 
the appeal process.\70\ One of the three recommended that FEMA publish 
appeal decisions online, while another suggested that if an applicant 
pursues an appeal and inspection documents exist, FEMA should provide 
those documents to the applicant regardless of the applicant's appeal 
approval or denial status. Four commenters maintained that the issue 
went beyond transparency and was instead a matter of fairness. They 
asserted that the existing appeal process is unfair because FEMA serves 
as both the original decision maker--determining applicant eligibility 
or award amount, while simultaneously serving as the final decision 
maker--determining if those same applicants have waged a successful 
appeal to overturn FEMA's original eligibility and/or award 
decisions.\71\ Three of these commenters went on to reason that a right 
of legal action in the courts, to include an oral hearing and 
discovery, should be built into the FEMA appeal process.
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    \70\ FEMA-2021-0011-0162, FEMA-2021-0011-0260, and FEMA-2021-
0011-0295.
    \71\ FEMA-2021-0011-0235, FEMA-2021-0011-0275, FEMA-2021-0011-
0295, and FEMA-2021-0011-0302.
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    FEMA does not have the legal authority to accept the commenters' 
suggestions to create a right to challenge FEMA's eligibility decisions 
in court as part of the appeal process, so that FEMA is not both the 
original decision maker and the final decision maker. The United States 
is immune from suit unless it consents to be sued.\72\ The Stafford Act 
provides that FEMA shall not be liable for any claim based upon the 
exercise or performance of or the failure to exercise or perform a 
discretionary function or duty. 42 U.S.C. 5148. The appeal process 
applies to FEMA's eligibility decisions under IHP. FEMA's eligibility 
decisions are discretionary determinations, which means that they are 
not reviewable by a court.\73\ However, FEMA has protocols in place 
that guarantee appeals are not reviewed by the same case worker who 
made the original eligibility determination.
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    \72\ See, e.g., United States v. Mitchell, 463 U.S. 206, 212 
(1983).
    \73\ See City of San Bruno v. FEMA, 181 F. Supp. 2d 1010, 1014-5 
(N.D. Cal. 2001) (``Distributing limited funds is inherently a 
discretionary responsibility.'') Please note, while the eligibility 
decisions underlying appeals are discretionary and therefore immune 
from suit, the mandatory provisions in 42 U.S.C. 5189a related to 
appeals are not: FEMA is required to issue rules providing for the 
fair and impartial consideration of appeals. FEMA has discharged 
that responsibility by issuing regulations although the content of 
those regulations are also considered discretionary and immune from 
suit. (Barbosa v. United States Dep't of Homeland Security, 916 F.3d 
1068, 1073 (D.C. Cir. 2019)) (``We have little doubt that the 
statutory requirement for regulations rely on the discretionary 
judgment of FEMA; the range of choice that FEMA can employ is quite 
wide'').
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    FEMA similarly does not have the legal authority to extend the 60-
day appeal time frame set forth in 42 U.S.C. 5189a(a). Nevertheless, as 
a part of this rule, FEMA identified an opportunity to

[[Page 3999]]

codify additional flexibilities for applicants in meeting this 60-day 
deadline for appeals sent by mail. As is currently done in practice, 
FEMA will continue to accept and process any appeal postmarked within 
60 days of the date on the applicant's IHP decision letter, even if 
FEMA receives the appeal outside of the 60-day deadline.
    FEMA can address comments to simplify the appeal process by 
removing the requirement to submit an appeal and by creating an 
optional appeal form. FEMA's existing regulations, 44 CFR 206.115(b), 
require that appeals must be in writing and explain the reason(s) for 
the appeal. However, a written explanation may not be necessary to 
substantiate an appeal claim. Instead, supporting documents, such as 
receipts, bills, repair estimates, contractor estimates, property 
titles, or deeds may better demonstrate the reason(s) for the appeal 
and provide justification for FEMA to reconsider the applicant's 
original eligibility determination. Nevertheless, to comply with the 
existing regulations, FEMA does not currently process appeals that do 
not contain the required written and signed letter of explanation, even 
if the applicant provides adequate documentation. To alleviate this 
bureaucratic hurdle, FEMA is removing the requirement that applicants 
must submit a signed appeal letter explaining the reason(s) for the 
appeal when they have provided sufficient justification through 
supporting documents. This change will streamline the appeal process 
and reduce additional paperwork and correspondence between the 
applicant and FEMA that may delay the applicant's recovery process.
    To further assist applicants with navigating the appeal process, as 
suggested by a commenter, as part of this rulemaking, FEMA has 
developed an optional Appeal Request Form which applicants may use to 
assist them when submitting an appeal.\74\ This form, which FEMA will 
accept as a written explanation, will be available online at 
www.DisasterAssistance.gov. These changes are intended to provide a 
more user-friendly, equitable, and efficient appeal process that better 
meets the needs of traditionally underserved populations.
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    \74\ FEMA is providing in this rule that appeals must include a 
written explanation or verifiable documentation for the appeal. This 
will give disaster survivors the option to complete the Appeal 
Request Form instead of drafting a written appeal letter, or submit 
verifiable documentation without the form or a letter. FEMA 
currently provides letters in English and Spanish. FEMA recently 
updated our English and Spanish letters to include a tagline in six 
languages informing applicants how to contact the Helpline for 
translation help. The six languages are: English, Spanish, Russian, 
Portuguese, Vietnamese, and Korean. FEMA knows which language to 
provide letters in based on the language that the Disaster Survivor 
selected on their Disaster Assistance Registration.
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    With respect to the additional suggestions from commenters, FEMA 
notes that under the current process, applicants may access key 
information online, including appeal status, letters, and their 
personal appeal decision. Applicants with an online account can upload 
their appeal \75\or check the status of their appeal, by visiting 
www.DisasterAssistance.gov and selecting Check Your Application Status 
or by calling FEMA's Helpline at 800-621-3362 (711 or VRS available). 
Applicants who use a relay service, such as a Videophone, InnoCaption, 
or CapTel, are asked to provide the specific number assigned to that 
service. Individual applicants can reference their personal appeal 
decisions and letters online if they have created an online account and 
selected electronic correspondence from FEMA. FEMA considered 
publishing appeals information. Ultimately, FEMA declined to do so, due 
to a concern that releasing data of only appeal applicants would appear 
to require greater public exposure for appeal applicants than is 
required for initial applicants. Publication of appeal records could 
discourage applicants from appealing, or even appear to be a punitive 
measure for individuals who appeal.
---------------------------------------------------------------------------

    \75\ Applicants that create an online FEMA account or use their 
login.gov account can upload documents including appeal letters.
---------------------------------------------------------------------------

    Our system does not have the capability to display inspection 
reports nor is it captured in FEMA's National Emergency Management 
Information System (NEMIS) in a way that would readily be understood by 
the public. As part of FEMA's development of a new system,\76\ FEMA 
plans to improve the amount of detail that can be provided to 
applicants related to their inspection results and eligibility.
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    \76\ FEMA has been collecting suggestions from various workshops 
and other feedback efforts to ensure the new system, once built, 
meets all IHP and applicant needs.
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    In addition, under section 423 of the Stafford Act, 42 U.S.C. 
5189a, and existing regulations governing FEMA IHP, 44 CFR 206.115(d)-
(f), an applicant may ask for a copy of information in his or her file 
by writing to FEMA. To promote transparency, FEMA's regulations require 
the agency to give the applicant a written notice of the disposition of 
the appeal within 90 days of receiving the appeal. The appeal decision 
made by FEMA, or the State, Tribal, or Territorial (STT) government in 
instances where the STT government has opted to process ONA, is final. 
FEMA believes its current regulations are sufficient to ensure that 
disaster survivors can exercise their right to appeal assistance 
decisions. The existing regulations provide FEMA with the flexibility 
needed to meet survivor needs, while complying with privacy and 
paperwork reduction laws, intended to protect applicant information and 
minimize burdens, and avoiding the unnecessary expenditures and delays 
that would be a part of implementing the expanded appeal process 
requested by commenters, which included a litigation component to the 
IHP appeal process.
    Finally, FEMA makes every effort to ensure that its correspondence 
is written using plain language and that eligibility notification 
letters provide adequate explanation of the applicant's eligibility 
determination, award decision, and next steps should the applicant want 
to appeal the eligibility determination or award amount.\77\ For 
example, FEMA conducts periodic, comprehensive reviews of our applicant 
correspondence to make improvements based on disaster survivor 
feedback. As part of this process, FEMA hosts focus groups with 
disaster survivors to give them the opportunity to review proposed 
changes to our letters \78\ and to provide us with feedback about how 
to make the letters more understandable and helpful. FEMA reviews the 
feedback received from the focus groups before finalizing changes to 
the letters. FEMA held focus groups in 2016 and 2022.\79\
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    \77\ FEMA currently provides letters in English and Spanish. 
FEMA recently updated our English and Spanish letters to include a 
tagline in six languages informing applicants how to contact the 
Helpline for translation help. The six languages are: English, 
Spanish, Russian, Portuguese, Vietnamese, and Korean.
    \78\ In 2022, the focus groups reviewed the following letters: 
Cover Letter sent to all applicants; Continued Temporary Housing 
Assistance Letter; Denial letter; Approval letter; Request For 
Information letter; and Identity Theft/Bank Routing letter.
    \79\ At the 2016 focus group, 196 people agreed to participate 
but only 76 actually attended the feedback sessions. At the 2022 
focus group, 102 people agreed to participate but only 18 actually 
attended the feedback sessions.
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    Prior to peak hurricane season in 2022, FEMA updated its applicant 
letters based on focus group feedback, with the intent of simplifying 
the letters and making the appeal process clearer. As one example of a 
change made based on focus group input, FEMA further clarified the 
relationship between SBA and FEMA and how our processes interact, after 
focus group members

[[Page 4000]]

indicated that the SBA section of the letters were confusing.
    Applicants who need assistance with understanding their eligibility 
notification letter or the appeal process can receive assistance by 
phone by calling the FEMA Helpline at 800-621-3362 (711 or VRS 
available). When available, applicants may also receive in-person 
assistance by visiting a local DRC, where FEMA and SBA customer 
representatives are available. FEMA will continue to explore options 
for simplifying the process for submitting appeals and strives to 
continue to identify ways to alleviate any disparate impacts to 
underserved groups in the IHP process.
Assistance by Default
    Two commenters suggested FEMA implement proactive measures to 
provide a broad delivery of disaster assistance to residents in a 
declared area in order to equitably deliver assistance without regard 
to economic ability, housing situation, or specific losses attributed 
to the disaster.\80\ One of the suggestions specified assistance should 
be delivered as an opt-out method, with a stronger focus on the housing 
needs of parolees and unhoused individuals.
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    \80\ FEMA-2021-0011-0259 and FEMA-2021-0011-0274.
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    FEMA has a duty under section 408(i) of the Stafford Act, 42 U.S.C. 
5174(i), to verify each applicant is eligible for assistance. 
Additionally, section 696 of the Post-Katrina Emergency Management 
Reform Act of 2006 (PKEMRA), 6 U.S.C. 795, also requires FEMA to 
develop and maintain proper internal management controls to prevent and 
detect fraud, waste, and abuse. Accordingly, without a change to these 
underlying statutory provisions, FEMA cannot provide assistance without 
first verifying the applicant's specific housing situation or losses.
    While FEMA understands the immediate need for assistance after 
catastrophic events, FEMA also has to balance its responsibility to 
ensure assistance is provided only to eligible individuals and for the 
purpose allowable by statute. Therefore, FEMA must verify disaster-
caused loss or expenses. Additional assistance provided for in this 
rulemaking, such as Serious Needs Assistance and Displacement 
Assistance,\81\ will make more funds immediately available and their 
eligibility criteria and uses are less specific than most existing 
forms of IHP assistance. It should also be noted that there are other 
State or local agencies, as well as volunteer organizations, that may 
be able to provide more targeted assistance to populations where needs 
and challenges extend beyond disaster caused impacts.
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    \81\ Applicants experiencing homelessness pre-disaster who can 
also verify occupancy at an impacted location may also be considered 
for Initial Rental Assistance only; LER; all types of ONA (this 
includes Serious Needs Assistance, Displacement Assistance, and 
Critical Needs Assistance (prior to the IFR).)
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    FEMA remains committed to ongoing community engagement and 
communication with our stakeholders to better understand the needs of 
traditionally underserved communities and to share information 
regarding disaster preparedness and recovery assistance. We conduct 
tribal engagement sessions on draft policies; and we have held 
engagement sessions with the public on letter updates. We also engage 
with other stakeholders, such as Congressional members and staff, State 
and local officials, and advocacy organizations to discuss their 
concerns.
Citizenship
    A few commenters raised issues regarding immigration status-based 
restrictions on FEMA IA, arguing that FEMA should reform the IA Program 
to ensure that undocumented residents are eligible. Commenters noted 
that undocumented families are unable to access a range of benefits and 
therefore are more likely to suffer lasting harm.\82\ One commenter 
stated that the FEMA registration process asks for information on all 
members of the household, not just the eligible member(s). Non-eligible 
parents who have survived disasters, even if they have U.S. citizen 
children, and other eligible survivors are not applying for help for 
fear they or others in their household may be turned in to immigration 
enforcement authorities.\83\ This commenter also stated that FEMA 
should repeal its alleged policy of forwarding citizenship status to 
immigration enforcement authorities or any other Government agencies. 
Another commenter stated that one of the obstacles for disaster 
survivors seeking FEMA assistance is that based on the ``Welfare Reform 
Act,'' an immigrant must have been designated a legal immigrant for 5 
years in order to receive any Federal financial assistance.\84\ Another 
commenter suggested that FEMA should look into creating and promoting 
programs available for people who are not citizens but pay taxes 
through work permits or ITIN \85\ numbers.\86\ Lastly, one commenter 
stated that immigration and naturalization status is one demographic 
characteristic that is notably absent in the RFI.\87\
---------------------------------------------------------------------------

    \82\ FEMA-2021-0011-0293 and FEMA-2021-0011-0269.
    \83\ FEMA-2021-0011-0245.
    \84\ FEMA-2021-0011-0255.
    \85\ An ITIN, or Individual Taxpayer Identification Number, is a 
tax processing number only available for certain nonresident and 
resident aliens, their spouses, and dependents who cannot get a 
Social Security Number (SSN). It is a 9-digit number, beginning with 
the number ``9,'' formatted like an SSN (NNN-NN-NNNN).
    \86\ FEMA-2021-0011-0275.
    \87\ FEMA-2021-0011-0163.
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    Title IV of the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996, sometimes referred to as the Welfare Reform 
Act, Pub. L. 104-193, provides that noncitizens who are not ``qualified 
aliens'' are not eligible for Federal public benefits, which include 
assistance provided under Section 408 of the Stafford Act, 42 U.S.C. 
5174. FEMA cannot alter this requirement without a statutory change; 
however, FEMA considers the citizenship status of the entire household 
where someone is applying for assistance. This means that any adult 
household member who is a U.S. citizen or qualified alien in the 
household may apply for assistance, or any undocumented immigrants with 
children who are U.S. citizens may apply on behalf of their child. 
Further, regardless of citizenship status, disaster survivors may be 
eligible for the following FEMA programs that provide services instead 
of financial assistance to individuals:
     Mass Care/Emergency Assistance (Section 403 of the 
Stafford Act, 42 U.S.C. 5170b) which addresses sheltering needs 
immediately following a disaster;
     Crisis Counseling Assistance and Training Program (Section 
416 of the Stafford Act, 42 U.S.C. 5183) which is a Federal-funded 
supplemental program that enables State, local, Territorial, or Tribal 
government agencies to provide crisis counseling services or contract 
with local mental health service providers to provide services;
     Disaster Case Management (DCM) (Section 426 of the 
Stafford Act, 42 U.S.C. 5189d) which is a Federal-funded supplemental 
program that provides financial assistance to State, local, 
Territorial, or Tribal government agencies, or qualified private 
organizations, to enable non-Federal entities to provide DCM services; 
and
     Disaster Legal Services (Section 415 of the Stafford Act, 
42 U.S.C. 5182) which via an agreement with the American Bar 
Association provides free legal help for survivors.
    In 2017, FEMA updated the FEMA registration language by removing

[[Page 4001]]

references to the Bureau of Immigration and Customs Enforcement \88\ 
and clarifying the reasons FEMA would share information. The current 
version informs applicants that, consistent with the Privacy Act, 5 
U.S.C. 552a, FEMA may share individuals' information with Federal, 
State, Tribal, and local agencies and voluntary organizations to enable 
individuals to receive additional disaster assistance or to allow FEMA 
to administer assistance.\89\
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    \88\ The Bureau of Immigration and Customs Enforcement is now 
referred to as the U.S. Immigration & Customs Enforcement.
    \89\ See ICR Reference No. 202201-1660-005, FF-104-FY-21-122 
(formerly 009-0-1) View Information Collection Request (ICR) Package 
(reginfo.gov).
---------------------------------------------------------------------------

    The topic of immigration is notably absent in the RFI because 
citizenship requirements for Federal assistance are established by 
statute and cannot be resolved via rulemaking. However, FEMA has no 
policy of forwarding individuals' information particularly pertaining 
to their citizenship status to immigration enforcement authorities. 
Accordingly, FEMA posts the following language via a flyer in all DRC 
locations. ``This location is a protected area designated to provide 
emergency response and relief. FEMA will not proactively share your 
information with immigration or law enforcement agencies. U.S. 
Immigration and Customs Enforcement (ICE) and U.S. Customs and Border 
Protection (CBP) will not conduct enforcement operations at or near 
this location, except in the most extraordinary of circumstances.''
Codes and Standards
    One comment was received suggesting that FEMA should require IHP 
applicants to adhere to minimum construction standards for any 
applicable repair to their disaster-damaged home, regardless of whether 
the local community has adopted a building code.\90\ While FEMA 
recognizes the importance of building codes and encourages all 
communities to adopt and enforce modern building codes,\91\ we do not 
believe it is appropriate to establish a nationwide minimum 
construction standard for IHP at this time. FEMA provides funds to IHP 
recipients to address disaster repair needs, which may include costs to 
meet applicable codes, up to the Housing Assistance maximum award. 
Recipients should rebuild or repair their damaged homes in compliance 
with applicable State and local codes, and are subject to State and 
local enforcement of those codes. FEMA does not have the capacity to 
monitor and enforce a nationwide minimum construction standard for IHP. 
Moreover, FEMA does not have the authority to fund costs of compliance 
of any such code beyond the maximum award amount, which would leave 
some recipients in a situation where FEMA would require repair work but 
would not be able to provide sufficient funding to cover it.
---------------------------------------------------------------------------

    \90\ FEMA-2021-0011-0307.
    \91\ https://www.fema.gov/sites/default/files/documents/fema_bcs-brochure_03-01-21_0.pdf.
---------------------------------------------------------------------------

Cost Share
    Two commenters raised issues regarding the cost share requirement, 
arguing that FEMA should reduce or remove the requirement 
altogether.\92\ The commenters noted that the cost share requirement 
can preclude many communities from accessing resources because they do 
not have the ability to meet the cost share, specifically, economically 
disadvantaged rural communities and Tribal Nations.
---------------------------------------------------------------------------

    \92\ FEMA-2021-0011-0265 and FEMA-2021-0011-0289.
---------------------------------------------------------------------------

    Section 408(g) of the Stafford Act, 42 U.S.C. 5174(g), governs the 
IHP cost share. Specifically, it states that the Federal share of 
Housing Assistance under the IHP will be 100 percent; whereas, the 
Federal share for Other Needs Assistance will be 75 percent and the 
non-Federal share will be paid from funds made available by the 
relevant STT government.\93\ The statute at 48 U.S.C. 1469a(d) allows 
FEMA to waive or adjust the cost share for disaster grants in insular 
areas such as the Virgin Islands, Guam, American Samoa, and the 
Northern Mariana Islands. Outside of this one specific flexibility, 
FEMA does not have the ability to waive or adjust the cost share for 
IHP assistance through regulatory change, as it would require a 
legislative change.
---------------------------------------------------------------------------

    \93\ The Stafford Act definition of State in 42 U.S.C. 5122(4) 
incorporates the Territories and DC. The ``References'' provision in 
42 U.S.C. 5123 incorporates Tribes into either the definition of 
State or local government, depending on the role of the Tribe.
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Data Sharing/Collection
    Two commenters expressed their concerns with how applicant data is 
shared from FEMA with local partners. One of them commented that the 
way in which FEMA shares data with local partners seems to be 
inconsistent from incident to incident.\94\ Additionally, they asked 
that FEMA utilize Internal Revenue Service (IRS) income data to 
expedite the verification process.\95\ The other commenter mentioned 
how FEMA's registration data needs to be accurate and quickly made 
available to local partners, and that FEMA should create procedures to 
safeguard applicants' information.\96\
---------------------------------------------------------------------------

    \94\ FEMA-2021-0011-0187.
    \95\ FEMA-2021-0011-0187.
    \96\ FEMA-2021-0011-0277.
---------------------------------------------------------------------------

    FEMA recognizes that data sharing might make it easier for 
survivors to access assistance from other entities, and FEMA is always 
looking for ways to simplify IHP and speed the delivery of assistance. 
However, collecting, maintaining, and sharing data on a large scale 
presents challenges with respect to data security, and updating the 
rules on data sharing with State and local partners requires carefully 
balancing those concerns against the benefits of simplifying the 
program. FEMA continues to work alongside its State, local, Tribal, and 
Territorial partners to ensure that disaster recovery resources and 
services are not delayed or hindered by data collection and sharing 
concerns. Applicants can also access up to date information on their 
individual applications by setting up a Disaster Assistance Center 
electronic account with FEMA following a disaster.
    Lastly, the IRS has indicated they could not share data with FEMA 
without statutory authorization.\97\ As most forms of FEMA assistance 
are not income dependent, however, using IRS income data would not 
significantly improve how quickly FEMA is able to get initial 
assistance to applicants. Applicants are asked to self-report their 
income at Registration Intake to determine if the applicant meets 
criteria established by the SBA to indicate the capability to repay a 
loan. Those applicants determined potentially capable of repaying a 
loan are referred to the SBA and must complete an application with the 
SBA before being further considered by FEMA for SBA-dependent ONA. 
Additionally, as part of this rule, FEMA is removing the requirement 
that applicants must apply and be denied for an SBA disaster loan 
before being considered for SBA-dependent ONA, further minimizing any 
potential benefits of information sharing by the IRS.
---------------------------------------------------------------------------

    \97\ See 26 U.S.C. 6103; IRS, Disclosure Laws (Oct. 5, 2022), 
https://www.irs.gov/government-entities/federal-state-local-governments/disclosure-laws. FEMA had multiple discussions with the 
IRS on this subject, and representatives from the IRS stated clearly 
that the agency believed that sharing this type of data with FEMA 
would require a statutory authorization.
---------------------------------------------------------------------------

Demographics
    One commentor stated that Federal funds should not be a roadmap but 
rather a single point of engagement and support, especially to 
underserved communities or other communities who may fall below the 
poverty line or

[[Page 4002]]

become homeless, and should ensure quality of life before the disaster 
for these communities.\98\ A few commenters suggested that FEMA should 
collect demographic data especially of those residing in vulnerable and 
underserved communities to identify the communities with the most need 
and enhance equitable recovery.\99\ One of those commenters also 
suggested that FEMA should reconsider the constraints of the Paperwork 
Reduction Act on how FEMA collects and shares voluntary demographical 
data.\100\ A few commenters raised the issue of the type of demographic 
data that FEMA should collect for identifying the communities which 
benefit most from FEMA resources to include voluntary household data 
(i.e., gender and race) and how they intersect (e.g., Black woman, 
Latino man); immigration and nationalization status; ethnicity; race; 
income; degree of rurality; and data that represents the underserved 
and others who may fall below the poverty line or become homeless.\101\
---------------------------------------------------------------------------

    \98\ FEMA-2021-0011-0159.
    \99\ FEMA-2021-0011-0163, FEMA-2021-0011-0224, FEMA-2021-0011-
0261, FEMA-2021-0011-0264, FEMA-2021-0011-0275, and FEMA-2021-0011-
0277.
    \100\ FEMA-2021-0011-0163.
    \101\ FEMA-2021-0011-0163, FEMA-2021-0011-0259, FEMA-2021-0011-
0261, and FEMA-2021-0011-0275.
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    With respect to acting as a single point of engagement for 
underserved communities' broader quality of life needs, FEMA is 
committed to providing disaster assistance in a fair and equitable 
manner. This rule's changes to how FEMA assesses habitability, 
discussed in more depth below, will put applicants in a better position 
to recover from disasters while staying within the bounds of FEMA 
statutory authority under the Stafford Act.
    With respect to demographic data, in an effort to further 
understand the distribution of awarded IHP assistance, FEMA obtained 
Office of Management and Budget's (OMB) approval to gather demographic 
information from disaster survivors who choose to provide it.\102\ This 
data will help FEMA assess \103\ whether agency policies and actions 
create or exacerbate barriers to full and equal participation in our 
programs and better understand program outcomes for applicants.
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    \102\ Information Collection 1660-0154, Generic Clearance for 
Civil Rights and Equity. In the IHP, FEMA already collects some 
demographics for programmatic reasons (date of birth/age, income, 
and disability via OMB Control Number: 1660-0002, Disaster 
Assistance Registration). Under 1660-0154, new questions pertaining 
to race, Tribal enrollment, ethnicity, education, gender, and 
marital status are intended to be used in order to conduct robust 
statistical analysis of the outcome of IHP for various vulnerable 
populations. The data will be used to understand intersectionality 
of demographics and identify any issues with program implementation 
that may be affecting a specific group of individuals.
    \103\ The supporting statement associated with FEMA's 
demographics data collection, 1660-0154, indicates that FEMA will do 
analysis of the demographic questions to determine if it is 
necessary to continue to collect the data based on our findings. We 
plan to complete this analysis after 2 years of data collection, in 
the fall of 2024, to inform whether all six questions are still 
needed.
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Disaster Housing Assistance Program
    A few commenters mentioned the expired Disaster Housing Assistance 
Program (DHAP), which initially was created as a FEMA pilot program 
administered by the U.S. Department of Housing and Urban Development 
(HUD) to assist applicants of Hurricanes Katrina and Rita,\104\ later 
for Hurricanes Ike and Gustav, and a small program for Hurricane Sandy. 
One commenter questioned why the previous administration did not 
utilize this program for any recent disasters.\105\ Two other 
commenters requested the pilot program be reinstated.\106\
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    \104\ See https://www.huduser.gov/portal/publications/destech/DHAP.html for a HUD evaluation of DHAP that served Katrina and Rita.
    \105\ FEMA-2021-0011-0149.
    \106\ FEMA-2021-0011-0162 and FEMA-2021-0011-0235.
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    Rather than reinstate DHAP,\107\ FEMA has instead developed and 
implemented another form of Direct Temporary Housing Assistance called 
Direct Lease. Direct Lease provides FEMA with the ability to lease 
properties not generally available to the public directly from the 
landlord to provide temporary housing to eligible survivors.\108\ Under 
Direct Lease, eligible survivors pay no cost for rent (not including 
utilities) for up to 18 months. FEMA matches survivors with available 
housing that meets their needs and FEMA is able to place applicants 
into Direct Lease within 4 to 6 weeks following a disaster 
declaration.\109\
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    \107\ Building off lessons learned from DHAP, HUD, and FEMA had 
exploratory conversations regarding development of a new pilot 
called Disaster Assistance Supportive Housing (DASH). However, DASH 
is not currently being pursued.
    \108\ The property must be an existing residential property, not 
typically available to the general public (i.e., corporate 
apartments, vacation rentals, and second homes) for use as temporary 
housing.
    \109\ In situations where pre-disaster HUD occupants are placed 
into a FEMA-provided direct housing unit, HUD will engage with the 
pre-disaster HUD assisted families to assist them in finding 
permanent housing.
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Direct Housing
    Several commenters mentioned Direct Housing Assistance. Four 
commenters recommended FEMA should change regulations and policy to 
allow FEMA to provide permanent housing solutions such as repairing 
and/or rebuilding the applicant's damaged/destroyed dwelling.\110\ One 
commenter desired more housing options outside of Transportable 
Temporary Housing Units under Direct Housing Assistance,\111\ whereas, 
another commenter wanted FEMA to provide more help to applicants on 
their permanent housing plan.\112\ Lastly, one commenter wanted to 
remind FEMA to ensure information provided to applicants meet relevant 
fair housing and civil rights laws and notes that FEMA should enforce 
those laws with entities with whom FEMA partners.\113\
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    \110\ FEMA 2021-0011-0157, FEMA 2021-0011-0237, FEMA 2021-0011-
0269, and FEMA 2021-0011-0224.
    \111\ FEMA 2021-0011-0261.
    \112\ FEMA 2021-0011-0146.
    \113\ FEMA 2021-0011-0235.
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    FEMA's existing regulations at 44 CFR 206.117(b) and IAPPG 1.1 
currently allow for the following forms of Direct Housing Assistance: 
Transportable Temporary Housing Units, MLR, Direct Lease, and PHC. Per 
42 U.S.C. 5174(c)(4), FEMA may only provide PHC assistance--in the form 
of direct repairs or new construction--to individuals and households to 
construct permanent or semi-permanent housing in insular areas outside 
the continental United States. Per 42 U.S.C. 5174(c)(4)(A)-(B), FEMA 
may also consider providing such assistance in other locations where no 
alternative housing resources are available and other types of 
Temporary Housing Assistance are unavailable, infeasible, or not cost-
effective.\114\ Such circumstances are extremely rare: FEMA has only 
authorized PHC in the continental United States twice.\115\
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    \114\ See 44 CFR 206.117(b)(4)(i)(F).
    \115\ The factors that most commonly result in a need for PHC 
outside the continental United States are a lack of temporary 
housing resources and an inability to bring temporary housing into 
an affected area due to high transportation costs.
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    FEMA supports all direct housing occupants--owners and renters--in 
achieving their Permanent Housing Plans \116\ through multiple 
channels, including working with Voluntary Agency Liaisons \117\ and 
DCM specialists

[[Page 4003]]

to identify and provide additional individualized services and 
referrals for occupants, coordinating with the respective STT 
government to jointly develop milestones for timely completion of 
occupant transitions to permanent housing, and maintaining engagement 
with the STT government and long-term recovery groups to identify State 
or local housing programs that can continue to support survivors after 
FEMA's direct housing mission closes. Furthermore, FEMA complies with 
and requires all housing entities with whom the Agency contractually 
partners to comply with Federal housing and civil rights laws. Lastly, 
it is important to note that FEMA is undertaking an effort to improve 
and streamline Direct Housing Assistance, which may include further 
regulatory reforms.\118\
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    \116\ Currently, permanent housing plan is defined at 44 CFR 
206.111 to mean a realistic plan that, within a reasonable 
timeframe, puts the disaster victim back into permanent housing that 
is similar to the victim's pre-disaster housing situation. A 
reasonable timeframe includes sufficient time for securing funds, 
locating a permanent dwelling, and moving into the dwelling.
    \117\ Voluntary Agency Liaisons establish and maintain 
relationships among Federal and SLTT governments, as well as 
voluntary, faith-based and community organizations active in 
preparedness, response, and recovery; coordinate with Voluntary 
Organizations Active in Disaster at the national, State, 
Territorial, Tribal, and local levels; assist with translating and 
navigating Federal programs for their stakeholders; provide 
technical guidance and support with donations, unaffiliated and 
spontaneous volunteer management; and collaborate with and support 
non-government organizations that deliver an array of disaster 
relief services to affected jurisdictions.
    \118\ Direct Housing field operations coordinate with DCM and 
Voluntary Agency Liaisons by hosting regular roundtable discussions 
to discuss unmet needs and identify specific solutions for occupants 
to help them achieve their permanent housing plans.
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Group Flood Insurance Policy
    One commenter stated that the IA flood insurance requirements, 
which attaches to property rather than people, can be a burdensome 
expense for those on limited and fixed incomes.\119\ The commenter also 
raised concern about FEMA's policy of determining an applicant 
ineligible for disaster assistance when they have failed to maintain 
flood insurance requirements established when the applicant received 
the initial FEMA financial assistance that triggered the flood 
insurance requirement. The commenter suggested FEMA consider extending 
group flood insurance coverage to poor communities beyond 36 months.
---------------------------------------------------------------------------

    \119\ FEMA-2021-0011-0275.
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    FEMA does not have the authority to remove the flood insurance 
requirement absent a legislative change to the National Flood Insurance 
Act of 1968 (NFIA). Under the Flood Disaster Protection Act of 1973, 
FEMA may not approve any financial assistance for acquisition or 
construction purposes for use in any Special Flood Hazard Area (SFHA) 
where the sale of flood insurance has been made available under the 
NFIA, 42 U.S.C. 4001 et seq., unless the building or mobile home and 
any personal property to which such financial assistance relates is 
covered by flood insurance in an amount at least equal to its 
development or project cost. See 42 U.S.C. 4012a(a). As the commenter 
notes, this requirement to maintain flood insurance applies to the 
property, regardless of whether ownership is transferred.
    While much of this comment touches on the National Flood Insurance 
Program (NFIP) and is outside the scope of this IA rulemaking,\120\ 
FEMA understands that flood insurance policies may be cost prohibitive 
for some disaster survivors as they are trying to recover from a major 
disaster. A GFIP is a form of assistance that can help applicants who 
have trouble affording an initial flood insurance policy. FEMA 
establishes a GFIP for each disaster declaration that results from 
flooding and is authorized for IA. FEMA's existing regulations at 44 
CFR 206.119(d) provide that individuals identified by FEMA as eligible 
for ONA as a result of flood damage caused by a Presidentially-declared 
major disaster and who reside in a SFHA may be included in a GFIP 
established under the NFIP regulations at 44 CFR 61.17.
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    \120\ FEMA is working on many rulemakings to help the public 
regarding the NFIP. See the following rules on FEMA's Unified Agenda 
(UA): 1) 1660-AB06, the National Flood Insurance Program: Standard 
Flood Insurance Policy (SFIP), Homeowner Flood Form. This rule would 
revise the SFIP by adding a new Homeowner Flood Form and five 
accompanying endorsements. The new Homeowner Flood Form would 
replace the Dwelling Form as a source of coverage for homeowners of 
one-to-four family residences. Together, the new Form and 
endorsements would more closely align with property and casualty 
homeowners' insurance and provide increased options and coverage in 
a more user-friendly and comprehensible format. 2) 1660-AB11, NFIP's 
Floodplain Management Standards for Land Management & Use, & an 
Assessment of the Program's Impact on Threatened and Endangered 
Species & Their Habitats. FEMA issued a Request for Information to 
receive the public's input on revisions to the NFIP's floodplain 
management standards for land management and use regulations. FEMA's 
authority under the NFIA requires the agency to, from time to time, 
develop comprehensive criteria designed to encourage the adoption of 
adequate State and local measures. The agency is reviewing potential 
actions to better align the NFIP minimum floodplain management 
standards with our current understanding of flood risk, flood 
insurance premium rates, and risk reduction approaches to make 
communities safer, stronger, and more resilient to increased 
flooding. FEMA is considering revisions to the minimum standards to 
better protect people and property in a nuanced manner that balances 
community needs with the national scope of the NFIP while also 
incorporating opportunities for improving resilience in communities 
that have been historically underserved. The agency is also 
reviewing ways to further promote enhanced resilience efforts 
through the Community Rating System and to strengthen NFIP 
compliance with Section 7 of the Endangered Species Act.
---------------------------------------------------------------------------

    Per IAPPG 1.1, FEMA directly purchases GFIP certificates on behalf 
of applicants who are required to purchase and maintain flood insurance 
but who may not otherwise be able to purchase a policy. This assistance 
is provided as a part of the effort to reduce future expenses from 
floods. As required by existing regulations at 44 CFR 206.119(a), 
applicants must apply for and be denied an SBA loan before receiving a 
GFIP certificate under ONA. This rule will remove this SBA requirement, 
which increases the number of applicants in SFHAs that are eligible to 
receive a 3-year policy from FEMA following a flood disaster.\121\
---------------------------------------------------------------------------

    \121\ An applicant who accepts an SBA loan with a flood 
insurance requirement will not be considered for a FEMA-purchased 
GFIP certificate in the same disaster as an applicant cannot hold 
two flood insurance policies on one property.
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Habitability
    A few commenters raised issues regarding the definition of 
``uninhabitable,'' recommending that FEMA should revise the definition 
to ensure it meets the needs of all disaster survivors and underserved 
communities.\122\ One commenter stated that FEMA defines 
``uninhabitable'' as a dwelling that is not safe, sanitary, or fit to 
occupy, but that FEMA has no published standard that establishes when a 
home is ``safe, sanitary, and functional.'' This commenter stated FEMA 
must clearly define what constitutes a ``safe, sanitary, and functional 
home.'' \123\ Another commenter stated that if a residence is deemed 
``safe to occupy'' the applicant will be denied IHP assistance, as it 
is presumed habitable, and that ``One Size Fits All'' Habitability 
Standard is built on the faulty assumption that what is safe to occupy 
for one is safe to occupy for all.\124\ This commenter also noted that 
following Hurricane Harvey, FEMA did not consider the presence of mold 
as a condition which would prevent safe occupation; therefore, many 
were denied assistance. Another commenter argued that part of the 
reason for fewer awards to low-income disaster survivors is likely 
based on the implicit bias and inadequate training of its inspectors 
but also that part of the reason lies in FEMA's standards for 
determining when a disaster survivor's home is ``safe to occupy.'' 
\125\ This commenter also noted that despite applicants living in homes 
with blue-tarped roofs, buckled floors, nonexistent foundations, 
destroyed septic systems, and gaping holes, they were denied assistance 
as their dwelling

[[Page 4004]]

was determined ``safe to occupy.'' Lastly, another commenter stated 
that FEMA lacks ascertainable standards for equitable and impartial 
distribution of Home Repair Assistance, which results in arbitrary, 
subjective decisions about who gets Home Repair Assistance and how much 
assistance is provided in each case.\126\
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    \122\ FEMA-2021-0011-0260, FEMA-2021-0011-0152, and FEMA-2021-
0011-0286.
    \123\ FEMA-2021-0011-0295.
    \124\ FEMA-2021-0011-0152.
    \125\ FEMA-2021-0011-0286.
    \126\ FEMA-2021-0011-0310.
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    Section 408 of the Stafford Act, 42 U.S.C. 5174, authorizes FEMA to 
provide Housing Assistance to applicants who, as a direct result of a 
major disaster, are displaced from their pre-disaster primary 
residences or are left with pre-disaster primary residences that are 
``uninhabitable'' or, with respect to individuals with disabilities, 
are ``uninhabitable or inaccessible.'' FEMA's regulations at 44 CFR 
206.111 defines ``uninhabitable'' as a dwelling that is not ``safe, 
sanitary or fit to occupy.'' FEMA's regulations at 44 CFR 206.111 
further defines ``safe'' and ``sanitary,'' but does not define ``fit to 
occupy.'' ``Safe'' means secure from disaster-related hazards or 
threats to occupants; ``sanitary'' means free of disaster-related 
health hazards.
    FEMA recognizes that current regulations limit assistance to 
applicants with residences that incurred disaster-caused damage falling 
short of immediate safety and sanitation concerns and prevents FEMA 
from addressing or assessing the general livability issues when 
determining Housing Assistance eligibility, and is making changes that 
are expected to address these concerns. FEMA is revising the term 
``uninhabitable'' to mean the dwelling is not safe or sanitary. FEMA is 
revising the term ``safe'' to mean secure from hazards or threats to 
occupants, and FEMA is revising the term ``sanitary'' to mean free of 
health hazards. FEMA is also removing the requirement for disaster-
damaged real property components to be functional immediately before 
the disaster in order to provide assistance for pre-existing damage 
exacerbated by the disaster. This change will remove a discretionary 
element for inspectors that is not required by the Stafford Act.\127\ 
As a result, applicants with minimal damage, who may be without the 
means to pay for minimal repairs, or who are unable to complete the 
work themselves, will be eligible for Home Repair Assistance.
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    \127\ In coordination with the publication of this rule, FEMA 
will ensure its training and instructional materials are updated to 
ensure all relevant FEMA staff are apprised of and are able to 
implement the changes.
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Hazard Mitigation Under IHP
    Eleven commenters stated that FEMA should allow recovery funds to 
be used toward making resilient upgrades that offer greater protection 
against future disasters, with one commenter specifically noting that 
this would be particularly helpful in flood prone areas.\128\ Another 
commenter noted the recent changes made to IHP assistance provide funds 
toward hazard mitigation measures; however, they stated that these 
funds are specifically for wind and flood events. This commentor 
believed that these funds should also be extended to wildfire and 
earthquake events.\129\
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    \128\ FEMA-2021-0011-0151, Attachment 1; FEMA-2021-0011-0206; 
FEMA-2021-0011-0209; FEMA-2021-0011-0221; FEMA-2021-0011-0224; FEMA-
2021-0011-0237; FEMA-2021-0011-0270; FEMA-2021-0011-0271; FEMA-2021-
0011-0278; FEMA-2021-0011-0285; and FEMA-2021-0011-0303.
    \129\ FEMA-2021-0011-0261. At the time of this comment, FEMA was 
only providing hazard mitigation assistance for items in wind and 
flood events. However, in August of 2022, FEMA added two fire-
specific hazard mitigation items, i.e., covering for attic vents, 
crawlspace vents, and vents in enclosures below decks and non-
combustible gutter and leaf guards. FEMA continues to explore hazard 
mitigation under the IHP to include funds for additional mitigation 
measures, some targeted toward additional disaster causes.
---------------------------------------------------------------------------

    FEMA recognizes that helping disaster survivors address hazard 
mitigation measures while repairing their homes from disaster damage 
will help make their homes more resilient. Therefore, using our 
authority under Section 408(c)(2)(A)(ii) of the Stafford Act, 42 U.S.C. 
5174(c)(2)(A)(ii), FEMA began including additional assistance for 
mitigation in Home Repair Assistance awards for disasters declared on 
or after May 26, 2021.\130\
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    \130\ See pages 86-88 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Prior to this IFR, hazard mitigation under IHP is awarded as part 
of Home Repair Assistance for specific real property components that 
existed and were functional prior to the disaster--roof, water heater, 
furnace, and main electrical panel.\131\ Hazard mitigation measures are 
intended to minimize future damage to owner-occupied residences and are 
subject to the IHP maximum amount of Home Repair Assistance. FEMA plans 
to expand hazard mitigation under IHP in the future to include funds 
for additional mitigation measures, some targeted toward additional 
disaster causes.
---------------------------------------------------------------------------

    \131\ Prior to this IFR, in order to receive IHP assistance 
toward hazard mitigation efforts, the component needs to have been 
functional prior to the disaster.
---------------------------------------------------------------------------

    This IFR will allow FEMA to include mitigation for components that 
were not functional prior to the disaster when the damage to the 
component is worsened by the disaster.
Home Repair Assistance
    Seven commenters raised concern regarding FEMA's delivery of Home 
Repair Assistance,\132\ specifically focusing on how FEMA addresses 
pre-existing damage.
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    \132\ FEMA-2021-0011-0033, FEMA-2021-0011-0149, FEMA-2021-0011-
0194, FEMA-2021-0011-0199, FEMA-2021-0011-0245, FEMA-2021-0011-0277, 
and FEMA-2021-0011-0310.
---------------------------------------------------------------------------

    Per Section 408 of the Stafford Act, 42 U.S.C. 5174, FEMA may 
provide financial assistance for the repair of owner-occupied private 
residences, utilities, and residential infrastructure (such as a 
private access routes) damaged by a major disaster to a safe and 
sanitary living or functioning condition; and eligible hazard 
mitigation measures that reduce the likelihood of future damage to such 
residences, utilities, or infrastructure.
    As part of this rule, FEMA is removing the requirement for real 
property components to be functional immediately before the disaster to 
provide assistance for pre-existing damage that has been further 
damaged by the disaster. When a component of the home with pre-existing 
damage is further damaged by the disaster, FEMA may provide assistance 
to fully repair or replace the item (as appropriate) rather than 
denying assistance solely because not all damage was caused by the 
disaster.
    One comment suggested FEMA focus its efforts on providing permanent 
repairs to disaster-damaged homes using a sliding scale benefit.\133\ 
FEMA has limited statutory authority to provide direct repairs via 
PHC--i.e., per Section 408(c)(4) of the Stafford Act, 42 U.S.C. 
5174(c)(4), FEMA may only provide financial assistance or direct 
assistance--in the form of direct repairs or new construction--to 
individuals and households to construct permanent or semi-permanent 
housing in insular areas outside the continental United States. or 
other areas where no alternative housing resources are available and 
other types of Temporary Housing Assistance are unavailable, 
infeasible, or not cost-effective. Because FEMA is authorized under 
statute to provide such assistance only in these limited circumstances, 
FEMA has only implemented this type of direct assistance twice before 
in the continental United States.
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    \133\ FEMA-2021-0011-0269.

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[[Page 4005]]

Homelessness
    Four commenters voiced concern over the lack of FEMA guidance to 
State, local, and Tribal governments on how to handle people 
experiencing homelessness during a disaster, the lack of resources 
available for people experiencing homelessness during or after a 
disaster, and the need for more programs dedicated to those 
experiencing homelessness.\134\
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    \134\ FEMA-2021-0011-0235, FEMA-2021-0011-0277, FEMA-2021-0011-
0295, and FEMA-2021-0011-0310.
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    Per Section 408(a)(1) of the Stafford Act, 42 U.S.C. 5174(a)(1), 
FEMA's IHP assistance is intended to assist with disaster-caused 
losses; therefore, issues related to pre-disaster homelessness are 
outside the scope of the program. FEMA does not provide Housing 
Assistance (Rental Assistance, Direct Assistance, Home Repair 
Assistance, or Home Replacement Assistance) to applicants experiencing 
pre-disaster homelessness if their need for housing or shelter was not 
caused by the disaster. However, applicants experiencing pre-disaster 
homelessness may be eligible for certain types of ONA (Transportation 
Assistance, Medical and Dental Assistance, Funeral Assistance, and 
Child Care Assistance). Further, applicants whose pre-disaster 
residence was a tent or other form of nontraditional housing could be 
considered for limited housing assistance (2-month initial Rental 
Assistance and Lodging Expenses Reimbursement) if a public official or 
homelessness advocate verifies a disaster survivor's occupancy and if 
that individual meets all other eligibility requirements.
    While FEMA may be limited in the types of assistance it can provide 
to pre-disaster homeless individuals, there are other Federal, State, 
or local government resources that are more readily available for this 
population, e.g., HUD's Emergency Solutions Grants Program or HUD's 
Rapid Unsheltered Survivor Housing Program.
    Applicants experiencing homelessness as a result of the disaster--
for example, those whose pre-disaster residences were destroyed due to 
a disaster--may be considered for various types of financial Housing 
Assistance to include Lodging Expense Reimbursement, Rental Assistance, 
Home Repair Assistance, and Replacement Assistance, to meet their 
disaster housing needs. Additionally, if a direct housing mission is 
approved for the disaster, they could be eligible for a direct housing 
unit depending on the level of damage incurred to their pre-disaster 
residence and on whether they have not been able to use any FEMA-
provided Rental Assistance.
IHP File
    A few commenters raised issues regarding FEMA's process for 
applicants to request a copy of their IHP file, stating that it is 
unnecessarily complex.\135\ One commenter argued that it is excessive 
and unnecessarily burdensome to require applicants to obtain notary 
signatures or provide the penalty of perjury statement in order to 
access their IHP file. This commenter reasoned that IHP file 
information should be accessible through one online portal.\136\ 
Another commenter argued that when applicants request a copy of their 
file, FEMA does not provide access to all specific information used to 
make FEMA's decision such as pictures, home and property damage 
descriptions, and eligibility decisions, including include how FEMA 
calculates the awards and inspection line-item pricing. This commentor 
also noted that to access this type of information, applicants must 
file a Freedom of Information Act request.\137\ Lastly, one commenter 
stated that FEMA should develop a streamlined process including a 
central point of contact for State-led agencies and other disaster 
relief organizations to obtain applicant information required to 
provide further recovery assistance years following the disaster 
declaration.\138\
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    \135\ FEMA-2021-0011-0149 and FEMA-2021-0011-0277.
    \136\ FEMA-2021-0011-0149.
    \137\ FEMA-2021-0011-0295.
    \138\ FEMA-2021-0011-0275.
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    There are multiple statutes which govern what information FEMA may 
collect and how that information may be shared. The Stafford Act allows 
FEMA to collect personal information to determine eligibility and 
administer FEMA disaster assistance as a result of an emergency or a 
Presidentially declared disaster. See 42 U.S.C. 5121-5207.
    As outlined on page 67 of IAPPG 1.1, applicants may submit a 
written, signed request for a copy of FEMA's records related to their 
registration for IHP assistance.\139\ The request must specifically 
state what information the applicant would like to receive (e.g., 
entire file copy, copy of all correspondence from FEMA, etc.) \140\ and 
who is to receive the requested information (e.g., self, attorney, 
friend, etc.). For identity verification purposes, the request must 
include, among other requirements, the applicant's signature with 
either a notary stamp or seal or the statement: ``I hereby declare 
under penalty of perjury that the foregoing is true and correct.'' 
Applicants have the ability to create an online account, via 
www.DisasterAssistance.gov, where they may access a high-level overview 
of their application, including eligibility determinations and letters 
provided by FEMA, upload documentation, and change some information. 
Current system limitations prevent FEMA from including information such 
as pictures, home and property damage descriptions, and inspection 
line-item pricing. However, FEMA is developing a new system with 
increased capabilities.\141\ Once such increased capabilities are 
developed, nothing in this rule will prevent FEMA from implementing 
them. Information on how FEMA calculates awards and determines 
eligibility are available to the public via the IAPPG.
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    \139\ Applicants may alternatively choose to complete, sign, and 
return the Authorization for the Release of Information Under the 
Privacy Act form (OMB No. 1660-0061) to request a copy of their file 
and authorize the release of information.
    \140\ Note that line-item pricing is not part of an applicant's 
IHP file and therefore is not included in requests for copies of IHP 
files. While NEMIS can provide a summary of the items viewed or 
noted during inspection, it does not include the line-item pricing.
    \141\ FEMA is in the very early stages of the Systems 
Engineering Lifecycle and Acquisition process. The Agency is working 
to complete all requisite documentation needed for gate reviews, and 
have requested funding via the Program Decision Option process to 
support completely modernizing the functionality currently provided 
by the legacy on-premises NEMIS-IA system. This will be a multi-year 
effort.
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    FEMA continues to work alongside its State, local, Tribal and 
Territorial partners to ensure that disaster recovery resources and 
services are not delayed or hindered by data collection and sharing 
concerns. Following a disaster, FEMA establishes a Joint Field Office 
(JFO), which is the appropriate central point to work with the State 
and disaster-relief organizations for the disaster. Once the JFO 
closes, those duties would devolve to the FEMA Region, unless a long-
term field office is set up to handle disaster-related concerns. FEMA 
has processes in place to assist States, Tribes, and Territories with 
information sharing. These entities work with the FEMA staff assigned 
to coordinate with them for a specific disaster. This is the standard 
process that FEMA utilizes when responding to disaster-specific 
requests of all types from States, Tribes, and Territories.
Insurance
    One commenter stated that the Stafford Act needed to be amended so 
that Federal assistance would not be considered a duplication of 
benefits

[[Page 4006]]

with received insurance proceeds.\142\ Statutory changes are outside 
the scope of this rulemaking.
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    \142\ FEMA-2021-0011-0153.
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Loss Verification
    Twenty-three comments were received regarding FEMA's loss 
verification methods,\143\ referencing FEMA's inspection process and 
describing it as slow, subject to human error, costly, and 
disproportionally impacting historically disadvantaged populations. 
While three commenters stated FEMA should utilize more geospatial 
technology or develop remote technology capabilities, one commenter 
\144\ noted concern over the remote inspector process established by 
FEMA during COVID-19, stating that it disadvantaged disaster survivors 
by creating additional documentation burdens, which particularly 
impacted those who were least able to access technology or local 
assistance. Another commenter noted their concern that the loss 
verification process prioritized property values rather than examining 
the full impact of the housing loss, thereby adversely impacting 
whether an applicant would be considered eligible for Direct Housing 
Assistance. Lastly, one commenter specifically stated that FEMA, during 
inspection, should count damages to mobile homes as personal property 
losses.
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    \143\ FEMA-2021-0011-0033, FEMA-2021-0011-0147, FEMA-2021-0011-
0151, FEMA-2021-0011-0153, FEMA-2021-0011-0159, FEMA-2021-0011-0162, 
FEMA-2021-0011-0163, FEMA-2021-0011-0169, FEMA-2021-0011-0199, FEMA-
2021-0011-0206, FEMA-2021-0011-0208, FEMA-2021-0011-0221, FEMA-2021-
0011-0256, FEMA-2021-0011-0261, FEMA-2021-0011-0270, FEMA-2021-0011-
0271, FEMA-2021-0011-0275, FEMA-2021-0011-0277, FEMA-2021-0011-0282, 
FEMA-2021-0011-0285, FEMA-2021-0011-0295, FEMA-2021-0011-0302, and 
FEMA-2021-0011-0310.
    \144\ FEMA-2021-0011-0169.
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    Once disaster survivors register for assistance, FEMA is required 
to verify losses to determine their eligibility for IHP assistance. 
FEMA uses multiple loss verification methods, including onsite and 
geospatial inspections as well as submitted documentation. FEMA may, at 
its discretion, determine other methods of verification (i.e., remote 
inspections) that will be used to help verify loss and deliver 
assistance.\145\ FEMA may also review and verify documentation for 
disaster-caused losses that cannot be verified through on-site or 
geospatial inspections.
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    \145\ FEMA uses a variety of techniques and technologies when 
conducting geospatial inspections. This includes using aerial and 
satellite photography and remote sensing technologies. For remote 
inspections, FEMA inspectors will contact applicants via phone and 
complete the standard onsite inspection process remotely based on 
responses from the applicant.
---------------------------------------------------------------------------

    FEMA inspectors are trained to identify post-disaster damage and 
record all appropriate evidence of any disaster damage. Home and/or 
property values are not considered during damage verification. While 
there are numerous checks and balances in place to verify consistent 
and accurate damage assessments, FEMA continues to explore ways to 
improve its loss verification methods.
    Per IAPPG 1.1, FEMA may provide financial assistance to repair an 
owner-occupied primary residence, utilities, and residential 
infrastructure, including private access routes damaged as a result of 
a Presidentially-declared disaster up to the financial Housing 
Assistance maximum award. Home Repair Assistance is intended to make 
the damaged home safe, sanitary, or functional. Damage to real property 
components of the applicant's home is addressed under the IHP's Home 
Repair Assistance, regardless of the type of home. Mobile homes have 
unique real property components, and damage to these items are captured 
during inspection. Personal Property is not dependent on the type of 
home and is recorded under ONA.
Multifamily Lease and Repair
    One commenter stated that FEMA should make more effort to aid 
residents of multifamily housing units in the wake of disasters.\146\
---------------------------------------------------------------------------

    \146\ FEMA-2021-0011-0268.
---------------------------------------------------------------------------

    Section 408 of the Stafford Act, 42 U.S.C. 5174, limits IHP 
assistance to individuals and households; \147\ therefore, in 
situations where multifamily housing units, such as a condominium, are 
damaged by a disaster, FEMA only provides financial Housing Assistance 
and ONA to owner-occupants for eligible disaster-caused damages to 
areas the owner is responsible for within their unit. These types of 
assistance do not cover repair for disaster-caused damage to 
multifamily housing units for structural elements (e.g., roof, exterior 
walls, chimneys, and shared foundation) and common areas shared by all 
residents such as recreational facilities, outdoor space, parking, 
landscaping, fences, laundry rooms, and all other jointly-used space, 
unless these spaces are the individual's responsibility.
---------------------------------------------------------------------------

    \147\ 44 CFR 206.113(b)(9) further limits assistance by stating 
that FEMA may not provide IHP assistance for business losses, 
including farm businesses and self-employment.
---------------------------------------------------------------------------

    FEMA may provide Direct Temporary Housing Assistance to eligible 
applicants in the form of temporary rental units made available through 
repairs or improvements to existing, vacant multifamily housing units 
(e.g., apartments). Under the Multifamily Lease and Repair program, 
FEMA may enter into lease agreements with owners of multifamily 
properties located in a disaster area and make repairs or improvements 
(including to structural elements and common areas of the multifamily 
properties) to provide temporary housing to eligible applicants. FEMA 
may utilize units repaired or improved under Multifamily Lease and 
Repair as temporary housing for eligible applicants who are unable to 
use Rental Assistance due to a lack of available resources. This type 
of Direct Temporary Housing Assistance is intended to repair or improve 
individual units to re-house existing tenants.\148\
---------------------------------------------------------------------------

    \148\ For additional information about Multifamily Lease and 
Repair, please see pages 107 to 112 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

Non-Traditional Housing
    One commenter stated that FEMA does not recognize applicants who 
live in non-traditional housing such as ``boats, yurts, and travel 
trailers.'' The commentor requested that FEMA consider these as viable 
places of residence and recognize them for compensation.\149\
---------------------------------------------------------------------------

    \149\ FEMA-2021-0011-0149.
---------------------------------------------------------------------------

    Per Chapter 3: II.B.10. of IAPPG 1.1,\150\ eligible applicants who 
live in travel trailers and boats may be eligible for Home Repair 
Assistance and Home Replacement Assistance. Applicants residing in 
yurts and other unique homes may also receive Home Repair Assistance 
for any damaged structural elements of the home. However, Home Repair 
Assistance and Home Replacement Assistance is not available for other 
non-traditional forms of housing if they do not have structural 
elements to assess and calculate a repair or replacement award (e.g., 
tents). By policy, FEMA defines non-traditional housing as a form of 
dwelling void of structural floor, structural walls, and structural 
roof. Applicants who reside in non-traditional housing who are able to 
verify occupancy may be eligible for initial Rental Assistance, Lodging 
Expense Reimbursement, and all types of Other Needs Assistance.
---------------------------------------------------------------------------

    \150\ See page 62 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
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Ownership/Occupancy
    All 26 comments received regarding FEMA's verification of applicant 
ownership and/or occupancy of their

[[Page 4007]]

disaster-damaged dwelling were consistent with one concern: the 
applicant's burden of proving ownership and/or occupancy, especially in 
relation to properties being passed down via heirship.\151\
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    \151\ FEMA-2021-0011-0033, FEMA-2021-0011-0149, FEMA-2021-0011-
0153, FEMA-2021-0011-0163, FEMA-2021-0011-0194, FEMA-2021-0011-0199, 
FEMA-2021-0011-0207, FEMA-2021-0011-0235, FEMA-2021-0011-0236, FEMA-
2021-0011-0245, FEMA-2021-0011-0255, FEMA-2021-0011-0259, FEMA-2021-
0011-0260, FEMA-2021-0011-0261, FEMA-2021-0011-0265, FEMA-2021-0011-
0273, FEMA-2021-0011-0275, FEMA-2021-0011-0276, FEMA-2021-0011-0277, 
FEMA-2021-0011-0282, FEMA-2021-0011-0286, FEMA-2021-0011-0293, FEMA-
2021-0011-0302, FEMA-2021-0011-0305, FEMA-2021-0011-0306, and FEMA-
2021-0011-0310.
---------------------------------------------------------------------------

    Per IAPPG 1.1, FEMA verifies occupancy through an automated public 
records search or submitted documents. In locations where automated 
verification of public records is limited, FEMA may partner with 
applicable authorities from the State, local, Tribal, or Territorial 
government to verify ownership or occupancy. When FEMA is unable to 
verify an applicant's occupancy of their disaster-damaged primary 
residence, the applicant may provide FEMA with documentation for 
verification. Based on comments submitted via the April 22, 2021 RFI, 
FEMA updated its automated public records criteria along with its 
policy to provide more documentation flexibilities for verifying 
occupancy. Specifically, as outlined in the Amendment to FEMA Policy 
(FP) 104-009-03, Individual Assistance Program and Policy Guide 
(IAPPG), Version 1.1 memorandum, dated September 2, 2021, FEMA will now 
accept social service organization documents, local school documents, 
Federal or State benefit documents, motor vehicle registration, 
affidavits of residency or court documentation, and mobile home park 
documents in addition to the documentation options listed in IAPPG 1.1 
to verify occupancy. Furthermore, as an option of last resort, FEMA may 
accept a written self-declarative statement from applicants whose pre-
disaster residence was a mobile home or travel trailer or from 
applicants living in insular areas, islands, and Tribal lands.
    Like occupancy, when FEMA is unable to verify an applicant's 
ownership of their primary residence, the applicant may provide FEMA 
with documentation to prove ownership. Based on comments submitted via 
the RFI, FEMA also updated its policy to provide more documentation 
flexibilities in order to verify ownership. Specifically, as outlined 
in the Amendment to FEMA Policy (FP) 104-009-03, Individual Assistance 
Program and Policy Guide (IAPPG), Version 1.1 memorandum, dated 
September 2, 2021, FEMA will now accept receipts for major repairs or 
improvements, mobile home park letters, court documents, and a public 
official's letter in addition to the documentation options listed in 
IAPPG 1.1 to verify ownership. Furthermore, as an option of last 
resort, FEMA may accept a written self-declarative statement from 
applicants whose pre-disaster residence was a mobile home or travel 
trailer, from applicants living in insular areas, islands, and Tribal 
lands, and from applicants whose pre-disaster residence was passed down 
via heirship.\152\
---------------------------------------------------------------------------

    \152\ Please see FEMA's Equity web page at Equity [bond] 
FEMA.gov (last visited July 2, 2022.)
---------------------------------------------------------------------------

    Both occupancy and ownership verification may be completed upon 
inspection if the applicant is able to show an acceptable document to 
the inspector. FEMA inspectors, however, will not accept self-
declarative statements; this option of last resort must be mailed, 
uploaded to the applicant's online account, or submitted in person at a 
DRC.\153\ For those applicants who are still unable to prove occupancy 
and ownership, FEMA will conduct proactive outreach via casework to 
ensure all eligible applicants are able to receive assistance.
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    \153\ FEMA inspectors do not have the ability to upload 
documentation into an applicant's file. Applicants may submit a 
self-declarative statement to FEMA by either mail, uploading the 
document into their online www.disasterassistance.gov account, or by 
visiting a DRC, where a FEMA employee may upload the document into 
their file.
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Period of Assistance
    Five commenters requested that the current period of assistance be 
extended or for there to be options in which it could be extended on an 
individual disaster basis.\154\ One of the commenters stated that some 
applicants who received FEMA assistance to fix their homes had 
contractors take money for the repairs but not complete the work, that 
FEMA should take on the burden of the lost money, or otherwise ensure 
that the work is properly completed, and that assistance from FEMA 
should only be complete when the people in a household are fully, 
safely housed again.\155\
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    \154\ FEMA-2021-0011-0153, FEMA-2021-0011-0163, FEMA-2021-0011-
0253, FEMA-2021-0011-0274, and FEMA-2021-0011-0277.
    \155\ FEMA-2021-0011-0274.
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    Section 408(c)(1)(B)(iii) of the Stafford Act, 42 U.S.C. 
5174(c)(1)(B)(iii), limits IHP assistance to 18 months following the 
date of the disaster declaration. The period of assistance begins at 
the date of the Presidential disaster declaration and not the date on 
which the disaster is designated for IA. FEMA may extend the period of 
IHP assistance beyond 18 months due to extraordinary circumstances if 
an extension would be in the public interest, and FEMA has implemented 
this authority when warranted.\156\ As the period of assistance is 
established in statute, it cannot be addressed in this rulemaking 
effort.
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    \156\ The President has delegated authority to the Administrator 
of FEMA to determine whether due to extraordinary circumstances an 
extension of IHP assistance beyond the 18-month limit would be in 
the public interest. See 42 U.S.C. 5174(c)(1)(B)(iii). Executive 
Order 12148, Federal Emergency Management, July 20, 1979 and 
Department of Homeland Security Delegation 9001.1. The FEMA 
Administrator has delegated authority to the Assistant Administrator 
for the Recovery Directorate to extend this period if they determine 
that due to extraordinary circumstances an extension would be in the 
public interest. See 44 CFR 206.110(e) and section G.4. of the 
Federal Emergency Management Agency (FEMA) Delegation Number: FDA 
112-002a-1 Issue Date: Oct. 30, 2020.
---------------------------------------------------------------------------

    FEMA assistance is intended for disaster caused losses. Disputes 
between contractors and individuals are private civil matters, in which 
FEMA has no authority to intercede. These should be addressed by the 
applicant through appropriate legal channels.
Rental Assistance
    One commenter stated that FEMA must include clear guidance in its 
policies to ensure that multifamily homes are treated in a fair and 
equitable manner, including expanding the definition of ``household'' 
so that multiple families in one housing unit are counted as separate 
households for purposes of calculating aid and are eligible for 
separate rental assistance when needed.\157\ This situation is 
addressed in current FEMA policy.\158\ FEMA may provide financial 
assistance to pre-disaster homeowners or renters to rent alternate 
housing if they are displaced from their primary residence as a result 
of a Presidentially-declared disaster. While FEMA typically will award 
Rental Assistance to the first individual who registers for the 
household, if a multifamily household is unable to relocate together 
due to extenuating circumstance, then FEMA may provide additional 
Rental Assistance to the other members of the household. Additionally, 
through this rule, FEMA is adding a new type of assistance--
Displacement Assistance--that will provide an additional resource to 
applicants who must temporarily

[[Page 4008]]

relocate from their home as the result of damage from a Presidentially-
declared disaster. Displacement Assistance will be an award amount 
based on the daily rate established by the STT government and is 
intended to provide flexibility for applicants to address their short-
term lodging needs via hotels, motels, friends and family, or other 
available options.
---------------------------------------------------------------------------

    \157\ FEMA-2021-0011-0295.
    \158\ See page 57 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Another commenter stated that it is common in Puerto Rico for 
multiple homes to be built on a single lot and to have the same address 
and that this leads to a denial of assistance for the second family to 
apply due to suspected duplication of benefits.\159\ Although FEMA did 
previously encounter difficulties distinguishing between separate homes 
on a single lot due to system limitations and lack of available third-
party data, we now have a better understanding of these arrangements 
and have improved our processes \160\ to ensure the appropriate 
assistance is provided to each family when FEMA can determine two 
separate homes exist and the applicants meet all other eligibility 
criteria.
---------------------------------------------------------------------------

    \159\ FEMA-2021-0011-0292.
    \160\ There are processes available in these types of unique 
situations where multiple households reside in the same house or 
there are multiple separate homes on the same property. In the case 
of multiple separate homes on the same property, applicants must 
demonstrate that the homes are separate structures, and for multiple 
households in the same home, they must demonstrate that they have a 
pre-disaster financial responsibility to the household, such as a 
formal agreement supported by pre-disaster rent receipts, cancelled 
checks, or money orders; pre-disaster lease, landlord's written or 
verbal statement, or rental agreement; or pre-disaster major utility 
bills.
---------------------------------------------------------------------------

Renter Assistance
    Ten commenters stated that FEMA assistance is prioritized for 
homeowners and that programs and services need to be expanded to 
include renters and/or provide more assistance programs to benefit 
renters.\161\ One commenter stated that FEMA should afford minority and 
poor families the opportunity to move to neighborhoods that are safer, 
the schools are better, and jobs are more available.\162\ This 
commenter also suggested that the choice of where to live must be built 
into FEMA housing programs. Another commenter stated that FEMA provides 
assistance for hotel stays, but there are not many programs that 
provide rental assistance, security deposits, and application fees for 
survivors that have to relocate.\163\ This commenter also stated that 
providing flexible funding for renters to replace appliances, 
furniture, clothing, and other necessary goods would be more 
beneficial. One commenter stated that the application for continuing 
Rental Assistance is onerous and difficult for survivors to complete. 
Further, applicants must continue to work toward obtaining permanent 
housing to remain eligible for continuing rental assistance.\164\
---------------------------------------------------------------------------

    \161\ FEMA-2021-0011-0293, FEMA-2021-0011-0271, FEMA-2021-0011-
0270, FEMA-2021-0011-0285, FEMA-2021-0011-0206, FEMA-2021-0011-0209, 
FEMA-2021-0011-0221, FEMA-2021-0011-0262, FEMA-2021-0011-0274, and 
FEMA-2021-0011-0187.
    \162\ FEMA-2021-0011-0199.
    \163\ FEMA-2021-0011-0275.
    \164\ FEMA-2021-0011-0295.
---------------------------------------------------------------------------

    A few commenters suggested that FEMA should partner with HUD to 
design resilient and affordable housing relocation solutions and follow 
a similar approach to HUD's Community Development Block Grant--Disaster 
Recovery (CDBG-DR) program for clients who want to remain in their 
communities while reducing disaster risk.\165\ Lastly, two commenters 
suggested longer-term, safe housing solutions that are affordable to 
renters, arguing that once the funds are exhausted for renters, FEMA 
transitional services are not timely or are complex processes causing 
victims to experience a period of homelessness.\166\
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    \165\ FEMA-2021-0011-0231, and 0264.
    \166\ FEMA-2021-0011-0256, and 0296.
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    Some of these comments misconstrue FEMA policy. Per Section 408 of 
the Stafford Act, 42 U.S.C. 5174, FEMA may only provide financial 
assistance to repair an owner-occupied primary residence, utilities, 
and residential infrastructure, including private access routes damaged 
as a result of a Presidentially-declared disaster. FEMA does not have 
the authority to provide repair assistance to renters or landlords not 
occupying the damaged property as their primary residence.
    Section 408 of the Stafford Act, 42 U.S.C. 5174, also states that 
FEMA may provide financial assistance, i.e., Rental Assistance, to pre-
disaster homeowners or renters to rent alternate temporary housing if 
they are displaced from their primary residence as a result of a 
Presidentially-declared disaster. FEMA may also provide Continued 
Temporary Housing Assistance (CTHA) to eligible applicants who 
exhausted previously awarded Rental Assistance (for its intended use), 
are unable to return to their pre-disaster residence because it is 
uninhabitable, inaccessible, or not available due to the disaster, and 
their post disaster housing costs represent 30 percent or more of their 
post-disaster household income.\167\ This assistance may be provided 
for up to 18 months or until the end of the 18-month period of 
assistance, whichever comes first.\168\ FEMA will also award applicants 
one additional month of rent when utilized for a security deposit. FEMA 
does not dictate where renters may choose temporary housing; rather, 
renters may choose where to live. Addressing the suggestion that FEMA 
partner with HUD to design a CDBG-DR equivalent, FEMA notes that HUD is 
a separate Federal agency with separate statutory authorities that 
differ from FEMA's both in terms of the structure of the Agency's 
programs and the objectives of those programs. Such a change is outside 
the scope of this rulemaking. However, FEMA is currently working with 
HUD on several housing issues in an effort to make better use of each 
agency's authorities in support of disaster survivors.
---------------------------------------------------------------------------

    \167\ See page 81 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \168\ FEMA may certify pre-disaster renters, up to 18-months or 
the end of the 18-month period of assistance, whichever comes first, 
for continued rent assistance when adequate, alternate housing is 
not available, or when they have not realized a permanent housing 
plan through no fault of their own. FEMA may certify pre-disaster 
owners for continued rent assistance, up to 18-months or the end of 
the 18-month period of assistance, whichever comes first, when 
adequate, alternate housing is not available, or when they have not 
realized a permanent housing plan through no fault of their own.
---------------------------------------------------------------------------

    FEMA agrees that renters should have equitable access to IHP 
financial assistance. One type of assistance renters may currently 
qualify for is Personal Property Assistance. Under Section 408(e)(2) of 
the Stafford Act, 42 U.S.C. 5174(e)(2), FEMA may provide financial 
assistance under the ONA provision of the IHP to repair or replace 
personal property damaged or destroyed due to a disaster. FEMA 
assistance to repair and replace personal property may be provided for: 
appliances (standard household appliances such as refrigerator, washing 
machine, etc.); clothing (essential clothing needed due to overall 
loss, damage, or contamination); room furnishings (standard furnishings 
found in a bedroom, kitchen, bathroom, and living room); and essential 
tools (tools and equipment required by an employer for employment and 
items required for education).
    Additionally, FEMA is committed to improving its Renter Assistance 
program in those areas where equity may be lacking. For example, as 
part of this rule, FEMA is broadening the IHP to encompass any damage 
to the applicant's primary residence that causes the home to be 
unsuitable for occupancy. This change allows more renters with minimal 
damages to qualify

[[Page 4009]]

for Rental Assistance if they must relocate for a short time while 
repairs are made to their apartment.
    As is discussed further below, FEMA is removing the requirement 
that applicants must apply and be denied for an SBA disaster loan 
before being considered for SBA-dependent ONA. Applicants may apply for 
an SBA loan for additional funds if they have an unmet need, but 
eligibility for Personal Property Assistance, Transportation 
Assistance, and Group Flood Insurance Policies will no longer be 
contingent on applying for and being denied for an SBA loan making them 
available to more renters.
    Another example of how FEMA is making strides towards equity 
involves regulatory updates to CTHA. The rule update will add 
flexibility regarding FEMA's ability to provide some continued 
assistance without requiring substantial documentation from the 
applicant. FEMA is also making updates to its CTHA policy and the 
Application for CTHA forms so that applicants have a better 
understanding of what documentation is needed at each step of the 
process. Plus, the applicant having to work toward obtaining permanent 
housing in order to remain eligible for continued rental assistance 
increases the likelihood of successful recovery outcomes.
    In addition, FEMA is implementing two new types of assistance, 
Serious Needs Assistance and Displacement Assistance. Serious Needs 
Assistance will provide funds to address immediate needs related to 
sheltering, evacuation, or other emergent disaster expenses. 
Displacement Assistance is intended to assist displaced applicants with 
the cost of short-term living arrangements immediately following a 
disaster.
SBA-Dependent ONA
    The majority of commenters who commented on this requirement raised 
the same concern: FEMA should remove the requirement for applicants to 
apply for and be denied an SBA loan before receiving consideration for 
IA grants. The commenters stated the process is unclear and places an 
unnecessary burden on applicants; creates a disproportionate barrier; 
and may, at best, lead to a delay in the registration process, or, at 
worst, effectively block access to the grants.\169\ Two commenters 
further expressed that forcing people to apply for an SBA loan after 
the initial registration is a barrier and deterrent to applying for 
help, especially in senior citizen communities as they do not want a 
loan and most are on a fixed income; for black disaster survivors who 
face their credit history being scrutinized without receiving tangible 
assistance; and for renters with low incomes, and for members of 
underserved communities, including people of color, who, many times, 
have a greater need than middle-income survivors.\170\ Another 
commenter argued that FEMA should automatically qualify the application 
and denial steps of the SBA process for individuals who already receive 
needs-based assistance such as food stamps, Supplemental Security 
Income, and Social Security Disability Income to allow the most 
vulnerable to receive assistance more quickly and easily.\171\ A few 
commenters offered solutions, such as that FEMA actively coordinate 
with the SBA to conduct pre-screening using SBA's established credit 
score and citizenship requirements before referring applicants to the 
SBA, and that FEMA's staff receive training on SBA-related issues and 
be able to answer questions about any aspect of the SBA's process.\172\ 
One commenter stated that FEMA underassesses the needs of renters with 
low-incomes, and for members of underserved communities, including 
people of color, who seek to recover damaged personal property and 
vehicles by first requiring an application for an SBA loan, which 
causes delays in their application process.\173\ Lastly, one commenter 
remarked that requiring an SBA loan denial as a prerequisite to 
receiving emergency aid burdens the applicant and paves the way for 
deeper poverty for survivors of natural disasters. This commentor 
further explained their perception that the ease to extend debt 
instruments (i.e., an SBA loan) is in stark contrast to the denial of 
assistance due to the lack of legal documentation or a means to fight 
unjust denials.\174\
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    \169\ FEMA-2021-0011-0245, FEMA-2021-0011-0251, FEMA-2021-0011-
0255, FEMA-2021-0011-0275, and FEMA-2021-0011-0277.
    \170\ FEMA-2021-0011-0245 and FEMA-2021-0011-0277.
    \171\ FEMA-2021-0011-0245.
    \172\ FEMA-2021-0011-0255 and FEMA-2021-0011-0275.
    \173\ FEMA-2021-0011-0277.
    \174\ FEMA-2021-0011-0306.
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    FEMA's current regulations under 44 CFR 206.119(a)(1)-(3) state 
that FEMA and the State may provide financial assistance to individuals 
and households who have other disaster-related necessary expenses or 
serious needs. Prior to this IFR, to qualify for assistance under this 
section, an applicant must also apply to the SBA Disaster Home Loan 
Program for all available assistance under that program; and be 
declined for SBA Disaster Home Loan Program assistance; or demonstrate 
that the SBA assistance received does not satisfy their total necessary 
expenses or serious needs arising out of the major disaster. FEMA's 
current 44 CFR 206.191(d) provides FEMA's sequence of delivery to 
ensure uniformity in preventing duplication of benefits. The delivery 
sequence pertains to that period of time in the recovery phase when 
most of the traditional disaster assistance programs are available. The 
delivery sequence includes in relevant part Housing Assistance pursuant 
to Section 408 of the Stafford Act, 42 U.S.C. 5174; SBA and Farmers 
Home Administration \175\ disaster loans; and then ONA, pursuant to 
Section 408 of the Stafford Act, 42 U.S.C. 5174.
---------------------------------------------------------------------------

    \175\ The Farmers Home Administration is now administered by the 
successor agencies of the Farmers Home Administration. The Farmers 
Home Administration disaster loans are now the Department of 
Agriculture disaster loans.
---------------------------------------------------------------------------

    Prior to this IFR, FEMA's regulations required SBA referrals, but 
FEMA only required applicants whose self-reported income meets the 
SBA's minimum income requirements to apply for and be denied an SBA 
disaster loan before receiving consideration for SBA-dependent ONA, in 
an effort to minimize the burden on and expedite assistance to 
applicants whose income did not meet SBA's minimum income requirements. 
Based on comments submitted via the RFI, the SBA, in coordination with 
FEMA, raised the minimum income threshold so that more eligible lower 
income applicants could be assisted by FEMA as opposed to referred to 
SBA for a loan.
    With this rule, FEMA is removing the requirement entirely that 
applicants must apply and be denied for an SBA disaster loan before 
being considered for SBA-dependent ONA. Removing this requirement will 
ensure low income and other vulnerable disaster survivors who may not 
have the means to obtain or repay a disaster loan due to their 
financial condition have equitable access to disaster assistance while 
also leveraging new ways to prevent duplication of benefits.\176\
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    \176\ FEMA currently shares relevant data with the SBA, and will 
continue to do so to ensure FEMA and the SBA continue to remain good 
partners and stewards of taxpayer dollars. FEMA and the SBA will 
continue to coordinate to ensure that FEMA assistance and SBA 
disaster loans do not cause a duplication of benefits for the same 
type of assistance.
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    Just because an applicant already receives needs-based assistance 
such as food stamps, SSI, and SSDI does not mean that they will be 
eligible for FEMA assistance. The applicant will have to meet the IHP 
eligibility

[[Page 4010]]

requirements which have no link to income for the majority of IHP 
assistance. Therefore, FEMA cannot automatically qualify applicants for 
IHP assistance based upon their already receiving food stamps, SSI, and 
SSDI.
Self-Employed Workers
    Two commenters stated that gig workers, artists, and other self-
employed individuals do not receive the same assistance as other 
applicants.\177\ One of those commenters detailed that FEMA should 
correct the inequity by extending eligibility to self-employed 
individuals for necessary expenses and serious needs for repair or 
replacement of tools, specialized or protective clothing and equipment 
required by an employer as a condition of employment. The commenter 
also stated that FEMA could streamline the process to remove obstacles 
that delay assistance to self-employed workers by eliminating the FEMA 
requirement for applicants to first apply for and be denied an SBA 
disaster loan before self-employed workers are eligible for Personal 
Property Assistance for necessary expenses and serious needs.\178\
---------------------------------------------------------------------------

    \177\ FEMA-2021-0011-0187 and FEMA-2021-0011-0200.
    \178\ FEMA-2021-0011-0200.
---------------------------------------------------------------------------

    Prior to this IFR, per 44 CFR 206.113(b)(9), FEMA may not provide 
IHP assistance for business losses, including farm businesses and self-
employment. Under current policy, self-employed individuals are 
eligible for FEMA assistance for their personal losses except for 
necessary expenses and serious needs related to business losses.\179\ 
Business losses include costs for essential tools, such as tool repair 
or replacement, computing devices, supplies, and uniforms, which may 
include specialized or protective clothing.
---------------------------------------------------------------------------

    \179\ See page 168 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    As part of this rule and in response to comments received during 
the Agency's RFI, FEMA is amending its regulations to allow FEMA to 
provide self-employed applicants with IHP financial assistance for 
necessary expenses and serious needs as it relates to self-employed 
applicants seeking assistance for the replacement of essential 
tools.\180\ FEMA is also adding a new definition at 44 CFR 206.111 of 
``essential tools'' to mean tools and equipment required for employment 
and items required for education. The changes will allow FEMA to 
provide assistance for disaster-damaged tools and equipment, or other 
items required for a specific trade or profession, for self-employed 
applicants, in their individual capacity.
---------------------------------------------------------------------------

    \180\ For self-employed applicants FEMA is requiring a written 
statement from the applicant, including an itemized list of 
essential tools, specialized or protective clothing, computing 
devices, and equipment required for self-employment, and verifying 
their need for the items. The statement must include ``I hereby 
declare under penalty of perjury that the foregoing is true and 
correct,'' and be signed by the applicant. Tax return documentation 
are required to establish self-employment (e.g., Form 1040 or 1040-
SR, Schedule C, etc.).
---------------------------------------------------------------------------

    In addition, this rule will remove the requirement for applicants 
to apply for and be denied an SBA loan before receiving ONA. For 
additional information, refer to the SBA-Dependent ONA discussion in 
section III.D.2 of this rule.
Single Application for Federal Assistance
    Twenty-one commenters recommend merging the information collection 
authorities that govern over 19 other Federal agencies in order to form 
a single registration for disaster assistance.\181\ These commenters 
point out how each of the separate registration processes of the 
various agencies places an unnecessary burden on the survivor as they 
try to recover from a disaster. One commentor also stated that the 
current documentation requirements and duplicative registration 
processes prevents them from receiving aid they would otherwise be 
eligible to receive.\182\
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    \181\ FEMA-2021-0011-0033; FEMA-2021-0011-0151 Attachment 1; 
FEMA-2021-0011-0153; FEMA-2021-0011-0157; FEMA-2021-0011-0159; FEMA-
2021-0011-0187; FEMA-2021-0011-0204; FEMA-2021-0011-0206; FEMA-2021-
0011-0209; FEMA-2021-0011-0221; FEMA-2021-0011-0235; FEMA-2021-0011-
0236; FEMA-2021-0011-0237; FEMA-2021-0011-0256; FEMA-2021-0011-0270; 
FEMA-2021-0011-0271; FEMA-2021-0011-0277; FEMA-2021-0011-0285; FEMA-
2021-0011-0293; FEMA-2021-0011-0295; FEMA-2021-0011-0302.
    \182\ FEMA-2021-0011-0295.
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    FEMA recognizes the complexities caused by multiple disaster 
registration processes and that data sharing might make it easier for 
survivors to access assistance. FEMA has previously examined whether a 
streamlined, one-stop shop application could be created and has 
identified statutory and administrative barriers that would prevent a 
single agency from collecting and sharing as wide a range of 
information as would be required for a unified application. A recent 
Government Accountability Office (GAO) report highlighted the potential 
benefits of a single application, but noted concerns about the 
feasibility of such an application and about whether it would actually 
reduce the complexity of Federal disaster recovery programs.\183\ 
However, within the spirit of these comments, and aligned with existing 
authorities, FEMA is streamlining the application process to reduce the 
burden on applicants, and plans to implement the streamlined process by 
the end of this year.\184\ This effort will also help prepare FEMA's 
technology platform to integrate with other Federal agency application 
platforms in the future, but such integration will likely still require 
multiple years of systems development. Nonetheless, FEMA continually 
assesses its application process and is open to other changes that 
would make it simpler or less burdensome for applicants.
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    \183\ GAO-23-104956, Disaster Recovery: Actions Needed to 
Improve the Federal Approach (November 15, 2022).
    \184\ Once the streamlined applicant process is implemented, 
survivors applying for disaster assistance will have the ability to 
select the type of assistance they require and only have to answer 
questions directly related to the specific types of assistance they 
need. This will decrease the number of questions survivors need to 
answer and reduce the time to complete their disaster application 
online or at a FEMA Disaster Recovery Center.
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Transparency
    Eight commenters raised transparency concerns regarding FEMA's IHP 
policy and guidance. The comments focused mainly on how FEMA should 
make public the policy and determination process it uses before IA 
decisions are made.\185\ Five commenters stated that FEMA should make 
FEMA's determination process for IA more transparent and accessible and 
that FEMA regulations should be easier to find.\186\ Two of those 
commenters also stated that there is a general lack of transparency 
around FEMA's inspection process.\187\ One commenter stated that FEMA 
denial codes used during Hurricane Harvey offer only vague reasons for 
a denial of renters and low-income homeowners.\188\ This commenter also 
believes FEMA made processing mistakes during Hurricane Harvey and is 
refusing to release the data to allow for a proper determination if a 
significant number of these denials were made incorrectly. One 
commenter also noted that FEMA's eligibility codes are not publicly 
accessible, and when found, they do not provide a detailed

[[Page 4011]]

explanation of the code.\189\ Another commenter stated that FEMA should 
publicize the RSMeans amounts.\190\ Lastly, another commenter suggested 
that FEMA should release information about the contracting process for 
IA in a transparent and more equitable way.\191\
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    \185\ FEMA-2021-0011-0206, FEMA-2021-0011-0209, FEMA-2021-0011-
0221, FEMA-2021-0011-0237, FEMA-2021-0011-0270, FEMA-2021-0011-0271, 
FEMA-2021-0011-0286, and FEMA-2021-0011-0295.
    \186\ FEMA-2021-0011-0033, FEMA-2021-0011-0245, FEMA-2021-0011-
0157, FEMA-2021-0011-0285 and FEMA-2021-0011-0277.
    \187\ FEMA-2021-0011-0277 and FEMA-2021-0011-0285.
    \188\ FEMA-2021-0011-0277.
    \189\ FEMA-2021-0011-0199.
    \190\ FEMA-2021-0011-0260.
    \191\ FEMA-2021-0011-0275.
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    The Stafford Act and FEMA's regulations at 42 U.S.C. 5174 and 44 
CFR 206.101-120 govern IHP's eligibility criteria. The Stafford Act and 
FEMA regulations are publicly available and can be found online by 
searching on www.fema.gov and www.ecfr.gov.
    FEMA embraces the tenets of transparency, participation, and 
collaboration to support citizens and first responders to increase 
government accountability, innovation, and effectiveness. To provide 
greater transparency on the IHP, FEMA released the Individuals and 
Households Program Unified Guidance (IHPUG) on September 30, 2016. The 
IHPUG compiled FEMA policy for each type of assistance under the IHP 
into one comprehensive document and was intended to serve as a singular 
policy resource for State, local, Territorial, and Tribal governments, 
and other entities who assist disaster survivors with post-disaster 
recovery. The IHPUG was eventually superseded by the Individual 
Assistance Program and Policy Guide, which was released on January 19, 
2019. The IAPPG consolidated policy statements from all IA Programs to 
include IHP, Mass Care and Emergency Assistance, and the Community 
Services. On May 26, 2021, FEMA released FP 104-009-03, IAPPG 1.1, 
which supersedes the IAPPG, Version 1.0. IAPPG 1.1 \192\ incorporates 
policy changes to the IHP resulting from Disaster Recovery Reform Act 
of 2018 (DRRA),\193\ and provides an updated guide to programs and 
activities available to an affected State, local, Territorial, or 
Tribal government following a disaster. Chapter 3.III.B. of the IAPPG 
includes information of how FEMA verifies losses via inspections.
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    \192\ See page 7 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \193\ Disaster Recovery Reform Act of 2018, Public Law 115-254, 
132 Stat. 3448 (Oct. 5, 2018), 42 U.S.C. 5174(h).
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    To increase consistency in implementation, collaboration, and 
knowledge sharing between State, local, Territorial, or Tribal 
governments, FEMA, and other Federal and non-Federal entities who 
assist disaster survivors, FEMA conducts a comprehensive review of IA 
policies no less than every 3 years. If FEMA determines it necessary to 
release new or updated policy language before the next scheduled 
update, FEMA will update the electronic version of the IAPPG, issue a 
memorandum describing the additions or updates, and post both documents 
at www.fema.gov.
    FEMA continuously seeks to improve public awareness and 
understanding of FEMA's programs. Some of the comments underestimate 
the transparency of FEMA policy. Uniform eligibility criteria are 
currently in place and available to the public. FEMA makes all 
policies, fact sheets, guidance, news, and multimedia content available 
online at www.fema.gov. FEMA continually updates and assesses the 
clarity and effectiveness of its IHP eligibility letters to ensure 
applicants are properly informed of the reasons for and consequences of 
FEMA's eligibility determinations, and how the decision may be 
appealed. Applicants who do not understand FEMA's determination process 
or have additional questions after receiving an eligibility letter can 
call FEMA's Helpline to request additional information.
    Existing technology for dissemination of disaster data includes 
OpenFEMA.\194\ Building off of the DHS Open Government plan,\195\ the 
OpenFEMA initiative proactively publishes data relevant to its mission 
and in open formats that are easily accessible to the public. FEMA has 
a long history of engaging non-profits, local communities and non-
governmental organizations (NGOs) and private entities to prepare for, 
protect from, respond to, recover from and mitigate hazards. This 
initiative aims to ensure FEMA is providing timely, usable, and 
accurate data in a raw format to constituents. This enables 
stakeholders to leverage the data in innovative and value-added ways. 
The OpenFEMA database is widely used, receiving approximately 8 million 
requests for data from roughly 64,000 unique visitors each month. Most 
importantly, by proactively releasing information on an ongoing basis, 
this initiative makes it easier to operationalize live data during a 
disaster. FEMA will continue to leverage innovative methods to collect 
and share data while adhering to all applicable laws and policies.
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    \194\ See OpenFEMA, https://www.fema.gov/about/reports-and-data/openfema.
    \195\ DHS, Open Government Plan 2016-2018 (Oct. 21, 2016), 
available at https://www.dhs.gov/sites/default/files/publications/2016%20Open%20Government%20Plan_vFinal.pdf.
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    RSMeans, http://www.rsmeans.com, is one of a number of commercial 
sources that produces industry-accepted guides of construction cost 
information to support estimating the repair or replacement cost of a 
building. Under FEMA's contract with RSMeans, the company identifies 
some of the costs to repair or replace damaged real and personal 
property based on geographic area. FEMA may not share RSMeans amounts, 
however, because the contract does not permit us to publicly post the 
company's proprietary data.
    Some of the comments touch on Mass Care and Direct Housing changes, 
which are outside the scope of this rule. A separate effort is underway 
to improve Direct Housing and other areas of IA that involve 
contracting.
    Also, in an effort to advance equity and improve program 
administration, in August of 2022, FEMA began gathering demographic 
information from disaster survivors that choose to provide it. This 
data will be used to assess the impact of IA Programs on underserved 
populations.
Transportation Assistance
    One commenter noted that FEMA should provide resources to help 
displaced households without access to cars obtain funding for 
increased transportation costs (e.g., the use of Uber or Lyft).\196\ 
Another commenter stated that FEMA should provide transportation 
assistance to applicants to use public transportation services (i.e., 
bus, metro).\197\
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    \196\ FEMA-2021-0011-0235.
    \197\ FEMA-2021-0011-0244.
---------------------------------------------------------------------------

    Per Section 408(e)(2) of the Stafford Act, 42 U.S.C. 5174(e)(2), 
and as outlined on page 170 of the IAPPG 1.1, FEMA may provide 
financial assistance under the ONA provision of the IHP to individuals 
and households with disaster-caused vehicle repair or replacement 
expenses. Unlike most other forms of IHP assistance, an applicant 
seeking Transportation Assistance does not need to live in the 
Presidentially-declared area to be considered for assistance.\198\ The 
affected STT government establishes the maximum amount of 
Transportation Assistance (i.e., Transportation Repair and 
Transportation Replacement) that may be awarded. The amount of 
Transportation Repair and Replacement Assistance awarded is based on 
the degree of damage and the STT government's repair and replacement 
maximum.
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    \198\ See page 170 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.

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[[Page 4012]]

    Understanding that applicants have serious and immediate needs 
after a disaster, including for transportation costs, this rule revises 
FEMA's regulations in order to establish Serious Needs Assistance. 
Through these changes, FEMA will provide more immediate financial 
assistance under the ONA provision of the IHP to applicants who have 
necessary expenses or serious needs as a result of a disaster. Serious 
needs may include but are not limited to: water, food, first aid, 
infant formula, diapers, personal hygiene items, and fuel for or the 
cost of transportation. FEMA's implementation of Serious Needs 
Assistance will also provide funds to address immediate needs related 
to sheltering, evacuating, or other emergent disaster expenses. As this 
assistance is intended to provide applicants the financial means to 
address immediate serious needs prior to FEMA's evaluation of their 
eligibility for other disaster assistance programs, FEMA will limit 
assistance to those applicants who are displaced from their pre-
disaster primary residence as a result of the disaster or who are 
sheltering in their pre-disaster residence and report a need to shelter 
elsewhere, and who assert they have a serious need at registration and 
request financial assistance for those needs and expenses.
Utilities
    One commenter stated that FEMA needed to provide more assistance to 
applicants to ensure their utility bills are paid.\199\ FEMA may 
provide assistance toward utility bills in limited circumstances. For 
example, FEMA may provide financial assistance to pre-disaster 
homeowners or renters to rent alternate temporary housing if they are 
displaced from their primary residence as a result of a Presidentially-
declared disaster. FEMA awards eligible applicants initial Rental 
Assistance based on the Fair Market Rent (FMR) established by HUD for 
the county, parish, Tribal land, municipality, village, or district 
where the pre-disaster residence is located and the number of bedrooms 
the household requires. Utility costs are factored into the FMR rate 
established by HUD. Additionally, should an applicant need continued 
rental assistance, the cost of utilities is factored into the CTHA 
award amount provided. Homeowners may also provide their pre-disaster 
housing costs (to include utilities) in order to show a continued 
financial need for CTHA. Under section 408 of the Stafford Act, 42 
U.S.C. 5174(c)(1)(A), however, FEMA, is not able to provide assistance 
for pre-disaster utility bills or for any utility bills from the 
residence from which the applicant was displaced.
---------------------------------------------------------------------------

    \199\ FEMA-2021-0011-0033.
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Other Comments on IHP Delivery
    One commenter raised the issue that FEMA's assistance is often 
times proportional to the survivor's pre-disaster financial condition. 
This commenter, and a few others, expressed that FEMA should prioritize 
assistance to individuals with fewer resources or capabilities \200\ 
including underserved communities and individuals who are near or below 
the poverty level and cannot afford insurance.\201\ Multiple commenters 
expressed concern that FEMA's housing programs are overly complex to 
navigate,\202\ especially for survivors whose first language is not 
English.\203\
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    \200\ FEMA-2021-0011-0005, FEMA-2021-0011-0159, and FEMA-2021-
0011-0236.
    \201\ FEMA-2021-0011-0159.
    \202\ FEMA-2021-0011-0159, FEMA-2021-0011-0265, and FEMA-2021-
0011-0276.
    \203\ FEMA-2021-0011-0276.
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    Two of those commenters suggested that FEMA should proactively go 
into communities disproportionately impacted by emergencies to assist 
survivors in navigating the process and accessing resources. 
Specifically, these commenters noted that disaster survivors should be 
able to access these resources without the need to apply for FEMA 
assistance.\204\
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    \204\ FEMA-2021-0011-0159, and FEMA-2021-0011-0265.
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    One commenter noted that survivors with LEP experience delays in 
recovery and often times receive denials for disaster assistance caused 
by miscommunications and misunderstandings of document requirements and 
lack of services to obtain equitable access to resources and 
assistance.\205\ Another commenter expressed that FEMA should provide 
assistance to local governments so that local officials could work 
within the community to ensure disaster survivors understand where and 
how to obtain disaster assistance. Alternatively, another commenter 
believed that FEMA should provide better outreach to underserved 
communities in order to inform and help survivors access and apply for 
FEMA's programs.\206\
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    \205\ FEMA-2021-0011-0193.
    \206\ FEMA-2021-0011-0287.
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    Three commenters suggested that FEMA should develop an internal 
program and policy evaluation capacity which would reduce the need for 
external review boards and inspector general audits that are more 
costly to the U.S. taxpayer and burdensome to FEMA personnel but 
results in little to no improvements in program equity.\207\
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    \207\ FEMA-2021-0011-0163, FEMA-2021-0011-0224, and FEMA-2021-
0011-0254.
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    Two commenters expressed that FEMA should apply the least 
restrictive guidance regarding documentation requirements across all 
jurisdictions to minimize administrative time, confusion, and 
inconsistencies from disaster to disaster, expressing that one way to 
start is for FEMA to apply more flexibility in its ``use of funds'' 
policy which would allow survivors to repurpose their rental assistance 
for home repair or vice versa in order to prioritize their own recovery 
needs.\208\ Two commenters expressed that FEMA's ``use of funds'' 
guidance leads to long wait times for FEMA assistance, communicates 
distrust between government and residents, and leaves owners and 
renters of substandard/damaged dwellings waiting for assistance 
especially for lower-income and underserved groups. A third commenter 
presented another example indicating that FEMA's strategy to provide 
limited assistance for temporary home repairs puts vulnerable 
communities at a greater risk to experience additional disasters due to 
climate change, and these vulnerable communities would greatly benefit 
from FEMA's consideration for permanent repairs to include minor 
cosmetic damage that can lead to further damage if left 
unrepaired.\209\ A fourth commenter noted that requiring applicants to 
have a bank account is an example of how FEMA's regulations and/or 
policies are complicated and negatively impact accessing assistance for 
underserved communities.\210\ In addition to the previous four 
examples, one commenter raised the issue that FEMA's annual adjustments 
of maximum IHP assistance should consider local rent control and 
stabilization protection limits.
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    \208\ FEMA-2021-0011-0235 and FEMA-2021-0011-0281.
    \209\ FEMA-2021-0011-0270, FEMA-2021-0011-0271, and FEMA-2021-
0011-0285.
    \210\ FEMA-2021-0011-0281.
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    A commenter stated that FEMA should include subsistence activities 
under ONA.\211\ Furthering that issue, another commenter expressed that 
climate injustice impacts indigenous people namely harvesters (fisher 
people), stating FEMA does not recognize them as businesses and denies 
assistance although they are registered within their Tribes as 
harvesters. This commenter also highlighted the difficulties 
experienced by black communities in receiving prompt

[[Page 4013]]

assistance and communicating with FEMA during Hurricanes Laura and 
Delta, noting that the New York Times recently cited a study showing 
that the higher the rate of black households in a ZIP code, the less 
likely they are to receive an inspection.\212\ This commenter also 
expressed the need for FEMA to provide housing assistance to unhoused 
or paroled individuals.\213\
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    \211\ FEMA-2021-0011-0246.
    \212\ FEMA generally conducts an inspection (onsite and/or 
geospatial) and considers documentation as methods to verify losses, 
which is required to determine eligibility for assistance. See IAPPG 
p. 72.
    \213\ FEMA-2021-0011-0274.
---------------------------------------------------------------------------

    Another commenter raised the issue that the process between 
registration and receipt of assistance is too long, confusing, and 
biased against persons or families in underserved communities, 
including people of color, and especially for the elderly/disabled 
individuals who have to wait on insurance adjustments in order to 
complete and collect documents required for FEMA's eligibility 
process.\214\ This commenter also suggested that FEMA consider 
subsidized air filters, cooling, and other assistance for pregnant 
individuals.\215\
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    \214\ FEMA-2021-0011-0256.
    \215\ FEMA-2021-0011-0258.
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    One commenter suggested that FEMA track and analyze who starts but 
does not finish the registration process to better understand barriers 
experienced by applicants seeking disaster assistance. This commenter 
raised the issue that FEMA's registration and the CTHA processes are 
burdensome, due to the length of the forms and instructions and the 
lack of a list of required documents, especially for survivors in 
poverty who may not be residing in traditional housing or not under a 
traditional written lease. This commenter suggested that FEMA 
completely remove its documentation requirements as applicants already 
have to certify the information provided is true and correct.\216\
---------------------------------------------------------------------------

    \216\ FEMA-2021-0011-0275.
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    Similarly, another commenter noted that survivors have difficulty 
after a disaster with collecting required documentation to complete a 
disaster registration and/or provide eligibility documentation after 
they have registered. This commenter also stated that FEMA should 
change its authorities to allow temporary to permanent housing 
solutions instead of just temporary housing assistance. Lastly, they 
remind FEMA that disaster assistance must be fair, equitable, and based 
upon an objective assessment of need.\217\
---------------------------------------------------------------------------

    \217\ FEMA-2021-0011-0277.
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    One commenter raised the suggestion for FEMA to provide two-way 
travel support to evacuated residents who want to return to their homes 
and provided examples of the challenges faced in Puerto Rico to include 
that some travel support was only available for residents who wanted to 
leave Puerto Rico and had the resources to start anew somewhere else, 
but others who lacked those resources experienced an insurmountable 
barrier to returning due to one-way travel restrictions.\218\
---------------------------------------------------------------------------

    \218\ FEMA-2021-0011-0292.
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    One commenter raised the issue that due to the lack of development 
for post-disaster replacement housing or existing overcrowding in 
Tribal communities, temporary housing often becomes de facto permanent 
housing, leaving many families to never recover or regain their housing 
and become permanently displaced.\219\ This commenter proposes 
implementing post-disaster temporary-to-permanent housing solutions in 
communities, with an emphasis on tribal communities. One commenter 
stated that FEMA mandates applicants leave their residences as a 
condition of eligibility in order to receive disaster assistance and 
requested the removal of this requirement.\220\ Another commenter 
expressed that IA should mimic Public Assistance's decision to remove 
the obtain/maintain flood insurance requirement for applicants who 
receive less than $5,000 to repair their damaged structure located in a 
SFHA.\221\
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    \219\ FEMA-2021-0011-0293.
    \220\ FEMA-2021-0011-0295.
    \221\ FEMA-2021-0011-0303.
---------------------------------------------------------------------------

    FEMA provides IHP assistance without concern to socioeconomic 
factors or gender, race, or ethnicity. IHP assistance provides 
financial assistance and direct services to eligible individuals and 
households who have uninsured or underinsured necessary expenses and 
serious needs caused by a disaster; it is intended to meet basic needs 
and supplement disaster recovery efforts. IHP assistance is not a 
substitute for insurance and cannot compensate for all losses.
    As outlined in Section 408(h) of the Stafford Act, 42 U.S.C. 
5174(h), the amount of financial assistance an individual or household 
may receive under IHP is limited. Financial Housing Assistance and ONA 
have independent and equal financial maximums, and FEMA adjusts these 
maximum awards each fiscal year based on the CPI-U. Temporary Housing 
Assistance, including Lodging Expense Reimbursement, Rental Assistance, 
and CTHA, are not counted toward the financial Housing Assistance 
maximum award.
    FEMA understands that an applicant's pre-disaster financial and 
living situation may impact their post-disaster resources or 
capabilities, and increasing equity in disaster assistance outcomes is 
an area of focus for FEMA. As part of this rule, and as discussed 
above, FEMA is removing the requirement for disaster-damaged real 
property components to be functional immediately before the disaster to 
provide assistance for pre-existing damage exacerbated by the disaster. 
Applicants without the means to pay for minimal damage, or who are 
unable to complete the work themselves--often low-income or other 
underserved populations--may be eligible for repair assistance under 
the changes. The intent is still to limit assistance to disaster damage 
impacting the home.
    One comment mentioned the disproportionate distribution of 
assistance based on an individual's or household's financial situation 
prior to the disaster.\222\ While the value of an applicant's home 
prior to the disaster is not a consideration for FEMA assistance, FEMA 
recognizes that lower income survivors may have smaller homes with 
fewer rooms leading to smaller average awards than more wealthy 
applicants with larger homes. The self-reported income at Registration 
Intake is used to determine whether the applicant meets the SBA 
disaster loan income requirements to be considered for a disaster loan 
for SBA-dependent ONA. Based on comments submitted via the RFI, the 
SBA, in coordination with FEMA, raised their minimum income threshold 
so that more eligible lower income applicants could be assisted by FEMA 
as opposed to referred to SBA for a loan. Additionally, as part of this 
rule, FEMA is removing the requirement that applicants must apply and 
be denied for an SBA disaster loan before being considered for SBA-
dependent ONA. Applicants may apply for an SBA loan for additional 
funds if they have an unmet need, but eligibility for Personal Property 
Assistance, Transportation Assistance, and Group Flood Insurance 
Policies will no longer be contingent on applying for and being denied 
for an SBA loan.
---------------------------------------------------------------------------

    \222\ FEMA-2021-0011-0005.
---------------------------------------------------------------------------

    The September 2, 2021, Amendment to FEMA Policy (FP) 104-009-03, 
Individual Assistance Program and Policy Guide (IAPPG), Version 1.1 
memorandum also amended the Home Repair Assistance section in IAPPG 1.1 
to include financial assistance to repair real property components 
impacted by

[[Page 4014]]

disaster-caused mold growth. The amendment's expressed intent was to 
support low income and other underserved disaster survivors who may not 
have the means to immediately address disaster damage, particularly 
when disasters are not declared immediately or inspections are delayed. 
However, all applicants with disaster-caused mold damage may be 
eligible for the assistance when they meet all other conditions of 
eligibility. These additional funds are provided as part of the Home 
Repair Assistance award when applicable.
    Also, as part of this rule, FEMA is making changes to the current 
regulations, at 44 CFR 206.111, that will broaden its definition of 
``uninhabitable'' as discussed below in section III.D. of this IFR. The 
changes to 44 CFR 206.117 will remove the requirement for disaster-
damaged real property components to be functional immediately before 
the disaster. These changes will allow IHP to provide assistance for 
pre-existing damage exacerbated by the disaster, which will create more 
flexibility within the program to meet disaster survivors' unique 
recovery needs.
    Another example of how FEMA is seeking to improve equity involves 
the regulatory updates to CTHA. This rule will add flexibility 
regarding FEMA's ability to provide some continued assistance without 
requiring substantial documentation from the applicant, while 
simplifying assistance delivery and reducing processing time. FEMA is 
making updates to its CTHA policy by adding a new form, the IHP 
Supplemental Application for CTHA form,\223\ and revising the IHP 
Application for CTHA form \224\ so that applicants have a better 
understanding of what documentation is needed at each step of the 
process.
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    \223\ FF-104-FY-21-115.
    \224\ FF-104-FY-21-115.
---------------------------------------------------------------------------

    The updates to CTHA policy and the applicable CTHA forms are 
intended to address to concerns raised by organizations and the public 
in general about the CTHA process. All changes--working together--are 
intended to better assist applicants in obtaining a permanent housing 
solution by the 18-month period of assistance.
    With respect to internal program and policy evaluation, FEMA is 
committed to improving our programs and internal processing 
capabilities, and previously established the IA Audit Section. This 
Section evaluates internal controls and makes recommendations for 
operational improvements within IA disaster assistance activities. The 
improvement recommendations are the results of thorough internal 
audits, studies, and investigations. The Audit Section's focus is to 
ensure compliance with the Stafford Act and other applicable laws and 
regulations. FEMA also has a Recovery Reporting and Analytics Division 
(RAD). This Division serves as the primary resource pool for analytical 
efforts and is focused on providing analysis and information that is 
targeted to inform specific operational or strategic decisions. FEMA 
also has a Continuous Improvement Division that routinely conducts 
reviews and issues internal after-action reports/recommendations on a 
variety of issues.\225\
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    \225\ Due to the scope and nature of after-action review 
products, these reports are intended for internal FEMA use and are 
often not applicable to external audiences. However, to contribute 
to a larger body of knowledge and foster lessons learned sharing 
within the emergency management community, after-action review 
products can be made available to jurisdictions and other Federal 
agencies that request them or as directed by the Regional 
Administrators, where appropriate. The general public release of 
after-action review reports only occurs for reports of national 
significance as deemed by Agency leadership.
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    FEMA also recently reviewed our policies and processes to improve 
the application process. Based on comments submitted via the RFI, FEMA 
updated its policy to provide more documentation flexibilities in order 
to verify occupancy. Specifically, as outlined in the Amendment to FEMA 
Policy (FP) 104-009-03, Individual Assistance Program and Policy Guide 
(IAPPG), Version 1.1 memorandum, dated September 2, 2021, FEMA will now 
accept social service organization documents, local school documents, 
Federal or State benefit documents, motor vehicle registration, 
affidavits of residency or court documentation, and mobile home park 
documents in addition to the documentation options listed in the IAPPG 
1.1 to verify occupancy. Furthermore, as an option of last resort, FEMA 
may accept a written self-declarative statement from applicants whose 
pre-disaster residence was a mobile home or travel trailer or from 
applicants living in insular areas, islands, and Tribal lands.
    Like occupancy, when FEMA is unable to verify an applicant's 
ownership of their primary residence, the applicant may provide FEMA 
with documentation to prove ownership. Based on comments submitted via 
the RFI, FEMA also updated its policy to provide more documentation 
flexibilities in order to verify ownership. Specifically, as outlined 
in the Amendment to FEMA Policy (FP) 104-009-03, Individual Assistance 
Program and Policy Guide (IAPPG), Version 1.1 memorandum, dated 
September 2, 2021, FEMA will now accept receipts for major repairs or 
improvements, mobile home park letters, court documents, and a public 
official's letter in addition to the documentation options listed in 
IAPPG 1.1 to verify ownership. Furthermore, as an option of last 
resort, FEMA may accept a written self-declarative statement from 
applicants whose pre-disaster residence was a mobile home or travel 
trailer, from applicants living in insular areas, islands, and Tribal 
lands, and from applicants whose pre-disaster residence was passed down 
via heirship.
    Both occupancy and ownership verification may be completed upon 
inspection if the applicant is able to show an acceptable document to 
the inspector. FEMA inspectors, however, will not be able to accept 
self-declarative statements as they are an option of last resort.
    FEMA recognizes that effective communication access regarding FEMA 
programs is essential in the recovery process, including during 
inspection, for all disaster survivors. FEMA has many ways to meet 
survivors' language needs. Many FEMA employees are bilingual or 
multilingual and can assist LEP survivors with registration in their 
primary language by phone and in-person at a DRC. When survivors visit 
a DRC there is a sign with the phrase ``If you do not speak English'' 
in over 40 languages. A DRC staff member will use that sign to 
determine what language the LEP survivor speaks and call for an 
interpreter to assist them. Applicants may also request language access 
by contacting FEMA's Helpline at 800-621-3362 (711 or VRS available). 
FEMA's Helpline has translation and interpretation services (provided 
by qualified translators and interpreters) available in 250 languages 
to assist LEP disaster survivors. FEMA often sends Disaster Assistance 
Teams into the affected communities to help survivors apply for IHP 
assistance. Or, FEMA may provide Mobile Registration Intake Centers 
which ease disaster survivor burden with registration as they provide 
survivors a way to perform initial registration, some technical 
assistance on current registrations, and allow them to have documents 
scanned into their case files. FEMA may also coordinate with the State, 
local, Tribal, or Territorial government to send staff into emergency 
shelters to assist survivors. FEMA staff are equipped with computers or 
similar devices to assist survivors with registering for IHP

[[Page 4015]]

assistance or providing them referrals to other resources.
    FEMA remains committed to ongoing community engagement and 
communication with our stakeholders to better understand the needs of 
traditionally underserved communities and sharing information regarding 
disaster preparedness and recovery assistance. FEMA has focused on 
hiring more bilingual employees, including hiring local staff in 
affected areas with large Spanish-speaking populations.
    One commenter appeared to misunderstand FEMA's Section 425, 42 
U.S.C. 5189c, Transportation Assistance policy, implying that FEMA only 
provides assistance for survivors to evacuate their homes and not 
assistance to return. As outlined in Appendix A of IAPPG 1.1, the 
Stafford Act authorizes FEMA to provide assistance, when approved, to 
relocate individuals displaced from their pre-disaster primary 
residences as a result of a major disaster or emergency or otherwise 
transported from their pre-disaster residence under Section 403(a)(3) 
or Section 502 of the Stafford Act, 42 U.S.C. 5170b(a)(3) and 42 U.S.C. 
5192, to and from alternative locations for short or long-term 
accommodation or to return an individual or household to their pre-
disaster primary residence or alternative location. Contrary to the 
comment, per IAPPG 1.1, eligible expenses may include one round trip 
airfare for all pre-disaster household members and household pets and 
service animals.
    A few other commenters also misconstrued other areas of IHP 
policy.\226\ For instance, applicants do not need to have a bank 
account in order to receive FEMA assistance. In addition to providing 
assistance via direct deposit, applicants can opt to receive assistance 
via check. Additionally, there are only a few types of assistance that 
are contingent on whether an applicant has relocated from their damaged 
dwelling (i.e., Lodging Expense Reimbursement, Rental Assistance, and 
Critical Needs Assistance (CNA)). Regardless of whether an applicant 
chooses to relocate from their disaster-damaged dwelling, applicants 
may be eligible to receive Home Repair Assistance or Home Replacement 
Assistance, along with other types of ONA such as Personal Property 
Assistance. Lastly, one commenter mentioned FEMA's use of funds 
policy.\227\ Section 314 of the Stafford Act, 42 U.S.C. 5157, governs 
FEMA's misuse of funds provision to state that individuals who 
knowingly misapply the proceeds of assistance provided via the Stafford 
Act shall be penalized. FEMA has limited discretion in how it 
implements this statutory provision. Even if the problems identified by 
the commenter, such as long wait times, are the result of the use of 
funds policy, FEMA lacks the authority to remove this limitation. 
Nevertheless, there are still some flexibilities with how an applicant 
may use their IHP assistance. For example, an applicant who receives 
Home Repair or Home Replacement Assistance may use the funds to either 
repair their disaster damaged dwelling or for the purchase of a home in 
a different location. Similarly, applicants who receive Rental 
Assistance may choose to use that assistance in any location around the 
United States.
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    \226\ FEMA-2021-0011-0235, FEMA-2021-0011-0281, and FEMA-2021-
0011-0295.
    \227\ FEMA-2021-0011-0235.
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    With respect to the comment that IA should remove the obtain/
maintain flood insurance requirement for applicants who receive less 
than $5,000 to repair their damaged structure located in a SFHA, FEMA's 
discretion to waive this requirement is limited by certain statutory 
provisions. Under the Flood Disaster Protection Act of 1973, FEMA may 
not approve any financial assistance for acquisition or construction 
purposes for use in any SFHA where the sale of flood insurance has been 
made available under the NFIA, 42 U.S.C. 4001 et seq., unless the 
building or mobile home and any personal property to which such 
financial assistance relates is covered by flood insurance in an amount 
at least equal to its development or project cost. See 42 U.S.C. 
4012a(a). FEMA understands that flood insurance policies may be cost 
prohibitive for some disaster survivors as they are trying to recover 
from a major disaster. A GFIP is a form of assistance that can help 
applicants who have trouble affording an initial flood insurance 
policy. FEMA establishes a GFIP for each disaster declaration that 
results from flooding and is authorized for IA. FEMA's existing 
regulations at 44 CFR 206.119(d) provide that individuals identified by 
FEMA as eligible for ONA as a result of flood damage caused by a 
Presidentially-declared major disaster and who reside in a SFHA may be 
included in a GFIP established under the NFIP regulations at 44 CFR 
61.17. A GFIP has a 3-year policy term and payments to cover the 
premium amounts for each applicant are necessary expenses eligible 
under ONA. Covering the first 3 years of applicants' flood insurance 
policies helps them to maintain that coverage even when dealing with 
other disaster-related expenses that might otherwise prevent them from 
being insured.

D. Changes in Policy Positions To Increase Equity in IHP

    As directed by Executive Order 13985 on ``Advancing Racial Equity 
and Support for Underserved Communities Through the Federal 
Government'' and Executive Order 14091, ``Further Advancing Racial 
Equity and Support for Underserved Communities Through the Federal 
Government.'' FEMA assessed whether underserved communities and their 
members face systemic barriers in accessing benefits under IHP and how 
any such barriers could be reduced. FEMA's assessment was informed by 
longstanding challenges individuals have reported facing in navigating 
IHP, the income project,\228\ and comments its stakeholders made in 
response to the equity RFI. FEMA balanced these potential changes with 
the statutory requirement that financial assistance under the Stafford 
Act should be a supplemental form of assistance that addresses 
disaster-related necessary expenses and serious needs and may not 
duplicate other forms of assistance. As a result of this assessment, 
FEMA determined it needed to re-visit and change position on certain 
policy positions that have resulted in inequities in the delivery of 
IHP.\229\ This section identifies prior policy positions FEMA has 
articulated for specific areas of IHP that have had the unintended 
consequence of creating inequities in the program and will be remedied 
with this IFR.
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    \228\ FEMA, Individuals & Households Program Survivor Income 
Analysis (2019) and Survivor Income Analysis: Phase 2--Drivers of 
variance in IHP assistance across income groups (2019). See Docket 
ID FEMA-2023-0003 on www.regulations.gov.
    \229\ FEMA also determined it needed to expand or improve 
existing forms of assistance under IHP to better address disaster 
needs and to simplify processes and documentation requirements that 
serve as barriers to equal opportunity. Those changes are addressed 
in Section IV's Discussion of the Interim Final Rule but do not 
require the additional analysis provided here because they are not 
changes in policy position.
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1. Treatment of Insurance Proceeds
    FEMA provides IHP financial assistance to applicants for uninsured 
or underinsured disaster-caused expenses up to the IHP cap for the 
applicable form of assistance. Pursuant to existing regulations at 44 
CFR 206.113(a)(4) and (a)(6), however, insured applicants are only 
eligible for such assistance if the net insurance settlement amount 
from insurance is: (1) less than the maximum

[[Page 4016]]

amount of assistance FEMA can authorize under IHP; and (2) insufficient 
to cover the insured applicant's necessary expenses or serious needs. 
FEMA introduced the current language in 2002 through an NPRM \230\ 
proposing regulations creating the IHP to implement amendments to the 
Stafford Act from the Disaster Mitigation Act of 2000 (DMA2K).\231\
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    \230\ 67 FR 3412, Jan 23, 2002.
    \231\ Public Law 106-390, 114 Stat. 1552 (Oct. 30, 2000).
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    DMA2K amended the Stafford Act primarily to authorize a program for 
predisaster mitigation, but also to streamline the administration of 
disaster relief and control the Federal costs of disaster 
assistance.\232\ For example, DMA2K enumerated the types of housing 
assistance available to individuals and set, for the first time via 
statute, sub-caps for repair and replacement assistance that were 
relatively low--$5,000 for repair assistance and $10,000 for 
replacement assistance.\233\ FEMA had to determine how to implement 
DMA2K within this context and within the context of the existing 
duplication of benefits provision in the Stafford Act which prohibits 
FEMA from providing assistance to individuals that duplicates 
assistance that has been provided under any other program or from 
insurance or any other source.\234\
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    \232\ Id.
    \233\ Id. FEMA noted in the 2002 NPRM that these caps were newly 
imposed via statute whereas FEMA had previously imposed caps 
administratively. 67 FR 3412, Jan 23, 2002. FEMA further noted that 
there appeared to be some ``confusion'' in the legislative history 
whether the $5,000 repair cap was also intended to encompass the 
costs for hazard mitigation measures and specifically requested 
comment on whether the cap might ``imprudently tie [FEMA's] hands'' 
in the implementation of the program. FEMA received comments 
agreeing that the cap was too limiting and stated it would seek 
legislative modifications. 67 FR 61446, Sept. 30, 2002.
    \234\ 42 U.S.C. 5155; Section 206 of DMA2K also addressed the 
duplication of benefits provision specifically as it related to 
repair assistance noting that FEMA should not require an individual 
to show that the assistance can be met through other means, ``except 
insurance proceeds.''
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    FEMA did not specifically provide a rationale for, or consider any 
alternatives to, comparing the amount of insurance proceeds to the IHP 
cap in the preamble to its 2002 regulation; however, by making it a 
condition of eligibility that the amount of the insurance proceeds an 
individual receives must be less than the maximum amount of IHP 
assistance available, FEMA essentially determined that any insurance 
payout an applicant receives should be deducted from the amount of the 
FEMA Verified Loss as if it were automatically duplicative of the 
assistance FEMA might be authorized to provide. The Stafford Act does 
not require this result: FEMA is authorized to provide financial 
assistance, and, if necessary, direct services, to individuals and 
households who, as a direct result of a major disaster, have necessary 
expenses and serious needs that they are unable to meet through other 
means.\235\
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    \235\ 42 U.S.C. 5174(a)(1).
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    FEMA's 2002 interpretation may have made sense in the context of 
DMA2K in which Congress expressed intent to control the costs of 
disaster assistance and established, for the first time via statute, 
low sub-caps on repair and replacement assistance.\236\ However, 
Congress has since indicated clear intent to increase the amount of 
assistance FEMA provides to individuals and households. For example, in 
PKEMRA, Congress removed the $5,000 and $10,000 caps on repair and 
replacement assistance and expanded other forms of assistance under 
IHP.\237\ In DRRA, Congress more than doubled the amount of assistance 
available under IHP and removed the caps for accessibility-related real 
and personal property items for applicants with disabilities.\238\ 
However, despite this clear Congressional intent to increase the amount 
of assistance FEMA provides to individuals and households, FEMA never 
re-visited its prior interpretation that any insurance proceeds should 
be automatically deducted from the total amount it provides to 
individuals.
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    \236\ Public Law 106-390, 114 Stat. 1552 (Oct. 30, 2000).
    \237\ Post-Katrina Emergency Management Reform Act of 2006, 109-
295, 120 Stat. 1452 (Oct. 4, 2006) at Section 689d expanding IHP to 
authorize payments for security deposits and utilities; Section 689f 
authorizing transportation and case management services to 
individuals and households; and Section 689i authorizing a pilot 
program to repair multifamily rental housing for the purpose of 
temporarily housing disaster survivors.
    \238\ Specifically, DRRA: (1) removed temporary housing 
assistance from the calculation of the maximum amount of financial 
assistance available to applicants; (2) doubled the total amount of 
assistance available to applicants under the remainder of IHP by 
separating the maximum amount of financial assistance for HA and ONA 
from one cap to two equal, independent caps; and (3) removed the 
financial assistance maximum award limits for accessibility-related 
real and personal property items for applicants with disabilities. 
See Disaster Recovery Reform Act of 2018, Public Law 115-254, 132 
Stat. 3448 (Oct. 5, 2018), 42 U.S.C. 5174(h).
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    This has resulted in an implementation inequity that penalizes the 
applicants with the most insurance coverage. Eligible applicants may 
receive the difference between the net insurance settlement amount and 
the amount of FEMA verified loss, up to the IHP cap. When an 
applicant's net insurance settlement amount from insurance is equal to 
or exceeds the IHP cap, FEMA determines that the applicant's need has 
been met by insurance and will not provide any additional assistance. 
In practice, what this means is that even when an applicant's net 
insurance settlement amount is less than the loss amount verified by 
FEMA (i.e., the applicant has an unmet need), an applicant is not 
eligible for IHP assistance if their net insurance settlement exceeds 
the IHP cap. Conversely, a similarly situated applicant with a net 
insurance settlement amount less than the IHP cap is eligible to 
receive IHP assistance to address their remaining unmet need in an 
amount up to the full IHP cap.
    Excluding from IHP financial assistance those insured applicants 
with a net insurance settlement amount that is equal to or exceeds the 
IHP cap can pose a significant obstacle to them achieving a permanent 
housing solution, especially for homeowners. An ineligible insured 
homeowner whose home is underinsured may be unable to afford the unmet 
financial need to repair the home. An ineligible renter may also find 
it difficult to obtain a permanent housing solution when faced with the 
cost of underinsured losses for personal property. In Table 2 below, 
which assumes an IHP cap for housing assistance of $42,500, both 
Applicants A and B have the same unmet need for home repairs, but only 
Applicant B is eligible for IHP financial assistance for no other 
reason than that their net insurance settlement amount is less than the 
IHP cap.

[[Page 4017]]

[GRAPHIC] [TIFF OMITTED] TR22JA24.001

    This potential inequity is compounded by the fact that the IHP cap 
for an eligible insured applicant is not reduced by the amount of their 
net insurance settlement. The end result is that, while Applicant A is 
not eligible for any IHP financial assistance (because their net 
insurance settlement amount exceeds the IHP cap), Applicant B is 
eligible for IHP assistance up to the full amount of the IHP cap. 
Furthermore, Applicant B is treated the same as Applicant C, an 
uninsured applicant; both applicants are eligible for IHP financial 
assistance to address their unmet need up to the full amount of the IHP 
cap. This further compounds the inequity for Applicant A, who had the 
most insurance protection.
    FEMA's use of the IHP cap to limit eligibility for insured 
applicants creates challenges for disaster survivor recovery by 
limiting the ability of some applicants to achieve a permanent housing 
solution. Applicants that cannot fund the full repair costs of their 
homes are, notionally, more likely to remain in temporary housing for 
extended periods of time. Ultimately, by making these additional funds 
available to applicants under the IHP cap, the Agency may save funds 
currently used for financial or direct temporary housing of this 
population.
    To help equitably address the unmet needs of insured applicants, 
and to more effectively assist them to achieve permanent housing 
solutions, FEMA considered the following options: (1) remove the IHP 
cap as a condition of eligibility for insured applicants; or (2) make 
the cost of the deductible eligible for insured applicants. Under the 
first option, FEMA would discontinue its application of the IHP cap 
against an applicant's net insurance settlement amount for the purpose 
of determining eligibility for IHP financial assistance. Instead, all 
insured applicants would be potentially eligible for IHP assistance 
irrespective of whether their net insurance settlement amount exceeds 
the IHP cap. The IHP cap would continue to limit the amount of IHP 
financial assistance that eligible applicants could receive to address 
their unmet need. During a 5-year period, only 0.4 percent of 
applicants with real-property insurance settlements were found to be 
ineligible for IHP assistance due to their net settlement amounts 
exceeding the IHP cap. Under this option, each of these ineligible 
applicants would have received approximately $24,000 in IHP financial 
assistance. Total costs to FEMA would have been approximately $398,000 
($365,000 in financial assistance and $33,000 for the cost of increased 
inspections). However, it may be the case that many potential 
applicants with net settlement insurance amounts greater than the IHP 
cap simply do not apply for IHP assistance. In that case, the total 
costs to FEMA could be significantly higher. Regardless, the impact to 
these applicants will be significant compared to uninsured IHP 
recipients and those with low levels of damage.
    Under the second option, FEMA would authorize eligible applicants 
to receive IHP financial assistance to address the cost of their 
deductible, irrespective of their FEMA verified loss. Based on 
insurance documentation, FEMA could pay applicants for the amount of 
their deductible. In cases where the insured applicant does not feel 
they have an unmet need, no FEMA inspection would be required. 
Applicants with an unmet need would receive funds to address their 
unmet need, as determined by their FEMA verified loss, and their 
deductible. In many cases, FEMA provides a lower amount of IHP funds to 
repair elements of a home than an insurance company provides. 
Therefore, addressing applicants' unmet needs and deductibles could 
help insured applicants recover more quickly post-disaster. It could 
also incentivize applicants to choose higher dollar deductibles, which 
does not align with Agency goals to increase insurance coverage in the 
general population.
    This option could be implemented individually or in conjunction 
with Option 1. While this option is easy to understand, in some cases, 
it may require FEMA to overpay applicants' unmet needs based on Table 3 
below. Applicant D has no unmet need per FEMA's calculations, but will 
still receive payment for their deductible. Applicant E has an unmet 
need and receives payment for that need and the amount of their 
deductible.

[[Page 4018]]

[GRAPHIC] [TIFF OMITTED] TR22JA24.002

    FEMA ultimately determined that removing the IHP cap as a condition 
of eligibility for insured applicants would be the most equitable in 
meeting the recovery needs of all applicants to assist them in 
recovering from the impacts of disasters by achieving permanent housing 
solutions more effectively. FEMA's post-DMA2K interpretation that the 
IHP cap should act as a condition of eligibility may have been 
reasonable given that the purpose of DMA2K was to control the costs of 
disaster assistance. However, the continued application of this policy 
position despite clear Congressional intent to increase assistance to 
individuals and households, and the inequitable treatment of applicants 
with varying levels of insurance coverage has led FEMA to reconsider. 
FEMA did not consider options that would provide less assistance to 
applicants than we already provide because it would contravene 
Congressional intent.
    In addition to equity, FEMA's intent is to reduce the complexity of 
our program so that it is more straightforward and user-friendly to 
navigate for all disaster survivors. As such, it makes sense to remove 
an arbitrary test that is difficult to explain or defend and instead 
provide assistance, up to the cap, for the unmet need not covered by 
insurance. Although the second option might increase the amount of 
assistance that insured applicants receive, it will not remedy the 
implementation inequity in which applicants who have more insurance 
coverage may receive less assistance to address unmet needs. The 
selected option increases assistance for insured applicants and will 
not decrease assistance for any other category of applicants; as such, 
there are no reliance interests FEMA must consider in making the 
change.

2. SBA Loan Requirement

    Through their authorizing statutes, both FEMA \239\ and the SBA 
\240\ may provide financial assistance to address personal property, 
transportation, and other necessary expenses resulting from a major 
disaster. FEMA provides this assistance through the ONA provision of 
the IHP and refers to these types of ONA collectively as ``SBA-
dependent ONA.'' FEMA and the SBA coordinate on the delivery of SBA-
dependent ONA to ensure compliance with two of FEMA's regulations: (1) 
44 CFR 206.191 which sets forth a sequence of delivery to prevent a 
duplication of benefits with assistance received from another source; 
\241\ and (2) 44 CFR 206.119(a)(1) through (3) which sets out the 
requirement that applicants apply and be declined for an SBA Disaster 
Home Loan before being considered for FEMA SBA-dependent ONA.\242\
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    \239\ Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, Public Law 93-288 as amended, Section 408(e)(2), 42 
U.S.C. 5174(e)(2).
    \240\ Section 9 of the Small Business Act, Public Law 93-24, 87 
Stat. 25, (April 20, 1973), as amended, 15 U.S.C. 636 et seq.
    \241\ Prior to this IFR, 44 CFR 206.191, Duplication of 
benefits. See paragraph (c)(1) and (d)(2)(iii).
    \242\ Prior to this IFR, 44 CFR 206.119(a)(1)-(3).
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    When applying for FEMA assistance, applicants who indicate a need 
for SBA-dependent ONA are asked to provide their approximate annual 
household income and number of dependents. FEMA's NEMIS performs an 
automated comparison of the applicant's information to the SBA's 
minimum income table to determine whether the applicant could 
potentially qualify for an SBA loan to cover their SBA-dependent ONA 
need. Applicants whose income and number of dependents do not meet the 
SBA's minimum threshold are not referred to the SBA and are considered 
for FEMA SBA-dependent ONA. For internal tracking purposes, FEMA and 
the SBA categorize these applicants as Failed Income Test (FIT). FEMA 
does not take additional steps to verify FIT applicants' income or 
dependent information before awarding funds for verified SBA-dependent 
ONA expenses; these expenses may include Personal Property Assistance, 
Transportation Assistance, and Group Flood Insurance Policies.
    Applicants whose income and dependent information meet the SBA's 
minimum income threshold are referred to the SBA to complete the loan 
application process. The SBA's loan application process consists of 
multiple steps at which the applicant's income, credit score, and debt-
to-earnings ratio are assessed and, in certain cases, verified with the 
IRS and a private credit reporting agency. If at any point during the 
process the applicant is declined for a loan, the applicant is referred 
back to FEMA for consideration for SBA-dependent ONA.
    The requirement to apply to the SBA for a loan before an applicant 
may be eligible for certain types of disaster assistance is a holdover 
regulatory requirement dating back to the implementation of the 
Disaster Relief Act of 1974 \243\ before FEMA existed and when disaster 
assistance was administered by a component of HUD called the Federal 
Disaster Assistance Administration (FDAA). The Disaster Relief Act of 
1974 authorized disaster assistance to individuals and households 
through two separate sections--one section addressed temporary housing 
and the other set up the Individual and Family Grant Program (IFG), 
which preceded the IHP.\244\
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    \243\ Public Law 93-288, 88 Stat. 143 (May 22, 1974).
    \244\ Id at Sections 404 and 408.
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    The IFG was a grant the FDAA could provide to States to administer 
to individuals and households, subject to national criteria, standards, 
and procedures established via regulation. The original implementing 
regulations did not include a requirement to apply to the SBA for a 
loan as a condition of eligibility before receipt of a grant under the 
IFG.\245\ The FDAA first proposed a

[[Page 4019]]

loan requirement in 1977, but it was limited to ``farmers, ranchers, 
and persons engaged in aquaculture'' who were required to apply to the 
Farmers Home Administration (FmHA) and provide proof of the denial of 
such loan assistance before they were considered eligible for 
assistance under the IFG.\246\ The FDAA revised the requirement in 1978 
to add the SBA to reflect an agreement between FmHA and SBA in which 
the SBA would make housing or personal property loans in a disaster 
when farmers had suffered production and farm losses as well as housing 
and personal property losses.\247\ The FDAA did not specifically 
provide a rationale for, or consider any alternatives to, this 
requirement.
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    \245\ 39 FR 28212, Aug. 5, 1974; 40 FR 23252, May 28, 1975. The 
implementing regulations did require that individuals or households 
applying to the State for assistance under the program certify that 
they had sought assistance for any necessary expense or serious need 
through other available disaster assistance programs, and either 
been denied for such assistance or demonstrate it had not satisfied 
their need, as a condition of eligibility.
    \246\ 42 FR 5094, Jan. 27, 1977; On July 11, 1977, 42 FR 35643, 
35644.
    \247\ On May 23, 1978, 43 FR 22029, 22030.
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    In 1988, the President signed the Robert T. Stafford Disaster 
Relief and Emergency Assistance Act of 1988 \248\ into law. FEMA \249\ 
issued a rulemaking \250\ to implement the changes in which it added 
new parts 206 and 207 to 44 CFR to govern assistance for disasters or 
emergencies declared on or after November 23, 1988. The section of the 
regulations governing the IFG was moved to 44 CFR 206.131. FEMA made 
reference in several parts of the IFG section to processes for 
applicants who were required to apply to the SBA or the FmHA before 
being eligible for IFG assistance,\251\ but the regulation no longer 
identified who was subject to the requirement or maintained the 
specific identification of the population of applicants who were 
required to apply for a loan as ``farmers, ranchers, and persons who 
engaged in aquaculture.'' \252\ Instead, FEMA was silent as to 
applicability. However, one section referred back to the general 
requirement in 44 CFR 206.131(d)(1)(i)(A) that an individual or family 
must apply for all applicable available governmental disaster 
assistance programs before being eligible for the IFG, beginning the 
current practice without explicitly determining that a loan from the 
SBA or FmHA constituted such ``applicable available governmental 
disaster assistance.'' At that time, FEMA also added 44 CFR 206.191 
governing duplication of benefits and containing the first iteration of 
the sequence of delivery that is found in FEMA's current regulations 
listing disaster loans from the SBA and FmHA as required to be provided 
before the provision of assistance from the IFG.
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    \248\ Public Law 100-707, 102 Stat. 4689 (Nov. 23, 1988).
    \249\ FEMA was established effective April 1, 1979, and the 
regulations governing the disaster assistance programs administered 
by the FDAA were redesignated without change from 24 CFR Chapter 
XIII to 44 CFR Chapter I (44 FR 56172, Sept. 28, 1979). The language 
related to the FmHA and SBA loan requirement for ``farmers, 
ranchers, and persons engaged in aquaculture'' were moved to 44 CFR 
205.48 without change or a rationale for, or consideration of any 
alternatives to, the loan requirement.
    \250\ 54 FR 11610, March 21, 1989.
    \251\ Id. at 44 CFR 206.131(d)(1)(iii)(D); 206.131(d)(4); 
206.131(j)(1)(ii)).
    \252\ Id. at 44 CFR 206.131(d)(1)(iii)(D).
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    In 2000, DMA2K \253\ amended section 408 of the Stafford Act to 
combine the two sections authorizing temporary housing and the IFG into 
one section setting forth one program for individuals and households. 
DMA2K acknowledged FEMA's longstanding position related to SBA loans, 
specifically prohibiting FEMA from denying assistance to individuals 
for temporary housing, home replacement, or permanent housing 
construction solely because of the SBA loan requirement.\254\ FEMA 
issued an NPRM \255\ proposing regulations to establish the IHP to 
implement these amendments. At that time, FEMA introduced 44 CFR 
206.119 which specifically requires that an applicant for IHP apply to 
the SBA for all available assistance under that program and either: (1) 
be declined for such assistance; or (2) demonstrate that the SBA 
assistance the applicant received failed to satisfy their disaster need 
before they are eligible for ONA.
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    \253\ Public Law 106-390, 114 Stat. 1552 (Oct. 30, 2000).
    \254\ Id. at Section 206; see also 42 U.S.C. 5174(a)(2).
    \255\ 67 FR 3412, Jan 23, 2002.
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    Neither the FDAA nor FEMA ever provided a specific rationale for, 
or considered any alternatives to, the determination that applicants 
must apply to the SBA for loans and be denied or demonstrate the 
assistance provided fails to meet their needs as a condition of 
eligibility for ONA. It is clear from the rulemaking documents and the 
placement of the language related to SBA loans in 44 CFR 206.191 that 
FEMA views the types of assistance both it and the SBA may provide as 
potentially duplicative and therefore believes it is necessary to 
establish procedures to prevent such a duplication. However, there is 
no specific explanation in the rulemaking documents which sets forth 
why the FDAA and FEMA decided that loans from the FmHA or SBA had to 
precede the delivery of ONA assistance in the sequence of delivery. It 
may be that FEMA viewed the SBA as required to be first in the sequence 
of delivery because the Stafford Act requires FEMA to provide 
assistance to individuals under IHP if the individuals have necessary 
expenses and serious needs which they are ``unable to meet through 
other means'' \256\ and the availability of an SBA loan could 
constitute those ``other means;'' however, that has never been 
explicitly stated as the rationale for the regulatory requirements.
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    \256\ 42 U.S.C. 5174(a).
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    In practice, the SBA requirement has created such a significant 
barrier to assistance that it has resulted in millions of potentially 
eligible applicants walking away from the disaster assistance process 
and therefore unable to address their necessary disaster expenses or 
serious needs. Based on data \257\ from all declared disasters from the 
last 10 years, 3,887,049 applicants have been referred to the SBA and, 
of those applicants, 2,140,115 that could have received an SBA loan or 
been eligible but chose not to take the loan, did not receive SBA-
dependent ONA awards (55 percent). During the last 10 years, the 
remaining 1,746,934 applicants received SBA-dependent ONA awards and, 
of those, approximately 364,334 were SBA denied, which is about 21 
percent.
---------------------------------------------------------------------------

    \257\ Data is for all declared disasters from January 1, 2010 
through December 31, 2019.
---------------------------------------------------------------------------

    The GAO completed a review of the IHP in 2020 and described the 
challenges and barriers associated with the SBA loan requirement as a 
problem that requires a solution.\258\ The GAO found that survivors may 
not complete the SBA loan application because they do not understand it 
is a requirement that governs eligibility for IHP.\259\ Multiple 
officials from SLTTs and NGOs confirmed that survivors did not 
understand or were confused by the requirement to complete an SBA 
disaster loan application to qualify for some types of assistance from 
FEMA's IHP.\260\ In addition to officials from SLTTs and NGOs, multiple 
FEMA staff members reported that survivors had challenges understanding 
the requirement to apply for an SBA loan and that the requirement has 
been a long-standing issue with the program.\261\ The GAO states that 
the process creates an additional burden on disaster

[[Page 4020]]

survivors because survivors who do not have much experience in dealing 
with the Federal bureaucracy are required to interact with multiple 
Federal agencies and fill out multiple forms (many of which ask the 
same questions).\262\ According to the GAO, the confusion and delays 
associated with this requirement may have created a barrier that 
prevented many potentially low-income IHP applicants with FEMA-verified 
personal property losses from being considered for personal property 
assistance.\263\ The GAO recommended that the FEMA Administrator assess 
the extent to which its process for determining an applicant's 
eligibility for SBA-dependent ONA limits or prevents survivors' access 
to IHP assistance, and work with SBA to identify options to simplify 
and streamline the disaster assistance application process for 
survivors.
---------------------------------------------------------------------------

    \258\ GAO-20-503, Disaster Assistance: Additional Actions Needed 
to Strengthen FEMA's Individuals and Households Program (September 
30, 2020).
    \259\ Id. at 36.
    \260\ Id.
    \261\ Id.
    \262\ Id. at 40.
    \263\ Id. at 39.
---------------------------------------------------------------------------

    The GAO report accurately identified the requirement to apply for 
an SBA loan as a longstanding issue. FEMA was sued in the wake of 
Hurricane Katrina where plaintiffs alleged, among other claims, that 
FEMA had violated 42 U.S.C. 5174(a)(2) when it unlawfully denied 
applicants temporary housing assistance by inaccurately telling them 
they had to first apply to the SBA for a loan.\264\ The Court found 
that while FEMA may not have actually denied disaster applicants for 
temporary housing as a result of their failure to apply to the SBA for 
a loan, it failed to properly communicate to individuals that the 
requirement only applied to the provision of certain types of ONA and 
that individuals could still receive temporary housing assistance even 
if they were seeking ONA and had not yet applied to the SBA. Plaintiffs 
alleged that the requirement, even if not applied to the denial of 
temporary housing assistance, was onerous and burdensome and caused 
extensive delays of necessary assistance. The Court found that a press 
release FEMA had issued to attempt to clear up the confusion only 
exacerbated it and issued a permanent injunction prohibiting FEMA from 
requiring applicants to complete an SBA loan application as a 
prerequisite for receipt of temporary housing assistance and from 
miscommunicating the nature of Federal assistance under the Stafford 
Act.
---------------------------------------------------------------------------

    \264\ McWaters v. FEMA, 436 F. Supp. 2d 802 (E.D. La. 2006).
---------------------------------------------------------------------------

    FEMA has attempted to remedy the confusion regarding the SBA 
requirement by explaining it in guidance documents, fact sheets, press 
releases, and videos.\265\ The message is not simple: FEMA must 
communicate that some applicants may be referred to the SBA, that those 
applicants must complete an application for a loan if they are 
referred, that if the referred applicants do not apply, they may be 
denied for some assistance, but they only might be denied for ONA and 
not for temporary housing. It is not surprising that the confusion and 
barrier to assistance has persisted.
---------------------------------------------------------------------------

    \265\ See pages 7, 45, 141-142, 145-146, 149, 166, 173, IAPPG 
1.1. Individual Assistance Program and Policy Guide [verbar] 
FEMA.gov; see also, e.g., Fact Sheets [verbar] FEMA.gov in which 
search of term ``SBA'' produces 187 results as of May 4, 2023 
covering data dating back to January 20, 2021 with some of the 
following representative fact sheets describing SBA requirement 
(Frequently Asked Questions About FEMA Disaster Assistance [verbar] 
FEMA.gov; FEMA Assistance Provides for Basic Needs [verbar] FEMA.gov 
Renters Can Apply for FEMA Assistance [verbar] FEMA.gov; Questions 
and Answers About Individual Assistance [verbar] FEMA.gov) see also, 
e.g., representative video FEMA Accessible: Three Ways to Register 
for FEMA Disaster Assistance--YouTube; see also, e.g., Press 
Releases [verbar] FEMA.gov in which search of term ``SBA'' produces 
375 results as of May 4, 2023 covering data dating back to January 
20, 2021 with some of the following representative fact sheets 
describing SBA requirement (SBA Helps Arkansas Businesses Impacted 
by Severe Storms and Tornadoes [verbar] FEMA.gov; Oklahoma Survivors 
in McClain and Pottawatomie Counties Can Apply for Possible FEMA 
Assistance [verbar] FEMA.gov).
---------------------------------------------------------------------------

    FEMA RFI commenters also identified the SBA loan requirement as an 
inequitable barrier to entry into the program. The commenters stated 
the process is unclear and places an unnecessary burden on applicants; 
creates a disproportionate barrier; and may, at best, lead to a delay 
or, at worst, cause a functional barrier in the registration 
process.\266\ Specifically, the commenters stated that: (1) forcing 
people to apply for an SBA loan after the initial registration is a 
barrier and deterrent to applying for help, especially for members of 
senior citizen communities who do not want a loan and may be on a fixed 
income; for black disaster survivors who face their credit history 
being scrutinized without receiving tangible assistance; and for 
renters with low-incomes and for members of underserved communities, 
including people of color, who many times have a greater need than 
middle-income survivors; \267\ (2) FEMA underassesses the needs of 
renters with low-incomes and members of underserved communities, 
including people of color, who seek to recover damaged personal 
property and vehicles by first requiring an application for an SBA 
loan, which causes delays in their application process; \268\ and, (3) 
the SBA requirement burdens the applicant and paves the way for deeper 
poverty for survivors of natural disasters and the ease to extend debt 
solutions (i.e., an SBA loan) to individuals greatly contrasts with the 
denial of assistance due to the lack of legal documentation or a means 
to fight unjust appeals.\269\ A few commenters offered solutions to 
include that FEMA actively coordinate with the SBA to conduct pre-
screening using SBA's established credit score and citizenship 
requirements before referring applicants to the SBA and that FEMA's 
staff receive training on SBA-related issues and be able to answer 
questions about any aspect of the SBA's process.\270\ Another commenter 
argued that FEMA should automate the application and denial steps of 
the SBA process for individuals who already receive needs-based 
assistance such as food stamps, Supplemental Security Income, and 
Social Security Disability Income to allow the most vulnerable to 
receive assistance more quickly and with less complexity.\271\
---------------------------------------------------------------------------

    \266\ FEMA-2021-0011-0245, FEMA-2021-0011-0251, FEMA-2021-0011-
0255, FEMA-2021-0011-0275, and FEMA-2021-0011-0277.
    \267\ FEMA-2021-0011-0277.
    \268\ FEMA-2021-0011-0277.
    \269\ FEMA-2021-0011-0306.
    \270\ FEMA-2021-0011-0255 and FEMA-2021-0011-0275.
    \271\ FEMA-2021-0011-0245.
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    Contrarily, the Department of Homeland Security's Office of 
Inspector General (DHS-OIG) criticized FEMA for not instituting enough 
controls over the SBA loan requirement process and recommended that 
FEMA collect and verify more documentation from disaster survivors, 
which would add more complexity to the process.\272\ DHS-OIG asserted 
that by not taking additional steps to verify a FIT applicant's self-
reported income and dependent information, FEMA made improper payments.
---------------------------------------------------------------------------

    \272\ DHS-OIG FEMA Has Paid Billions in Improper Payments in SBA 
Dependent Other Needs Assistance Since 2003, OIG-20-60, page 1.
---------------------------------------------------------------------------

    FEMA explored multiple options to improve its verification of self-
reported income in response to DHS-OIG's concerns. FEMA first 
considered whether it could require applicants to submit more 
documentation to verify income. Examples of acceptable documentation 
would include the previous year's tax returns or pay-related documents 
from an applicant's employer. Applicants whose documentation indicated 
that their income and dependent information met the SBA's minimum 
threshold would be referred to the SBA for loan consideration.\273\ 
However, creating an

[[Page 4021]]

additional administrative hurdle in the immediate aftermath of a 
disaster would greatly increase the applicant's post-disaster stress 
and strain FEMA's case-processing resources. FEMA continually attempts 
to minimize the forms of assistance that require documentation and 
manual review prior to award. Typically, most SBA-dependent ONA can be 
auto-processed by NEMIS post-inspection with no required staff 
interaction. Auto-processed awards can be received by applicants that 
select an electronic funds transfer within 24 hours of their 
inspection. Most applicants receive automated payments within 1 to 2 
weeks of applying for assistance, while manual payments take a few 
months to be processed and received by applicants, especially in larger 
disasters. Increasing the manual workload would further increase the 
time and/or cost required to make manual payments.
---------------------------------------------------------------------------

    \273\ As with each of the options FEMA evaluated, the SBA would 
need to update their application evaluation process to ensure these 
referred-based-on-verification applicants were not referred back to 
FEMA based solely on their self-reported income. The SBA also relies 
on self-reporting during the initial loan application process. The 
SBA uses this information to calculate an income/number of 
dependents to debt ratio and compares it to a minimum threshold. The 
SBA only verifies the income of those applicants that pass this 
initial threshold, which it accomplishes by coordinating with the 
IRS and reviewing applicants' credit score.
---------------------------------------------------------------------------

    FEMA could take steps to verify income for FIT applicants in 
coordination with external government partners. This involves certain 
legal challenges FEMA would have to overcome. The SBA has specific 
legislative authority, which FEMA does not have, to verify an 
applicant's income with the IRS as part of its loan application 
process. The IRS has indicated they could only pursue data sharing if 
there were specific statutory authority for it.\274\ If FEMA overcame 
this legal hurdle, this option would appear to be less burdensome for 
the applicant, as FEMA would undertake the initial step of verifying 
the applicant's income and dependent information from the previous tax 
year; however it would still add some time and additional documentation 
requirements to the IHP registration process.
---------------------------------------------------------------------------

    \274\ See 26 U.S.C. 6103; IRS, Disclosure Laws (Oct. 5, 2022), 
https://www.irs.gov/government-entities/federal-state-local-governments/disclosure-laws.
---------------------------------------------------------------------------

    FEMA could purchase the services of a privately operated credit 
reporting company which can verify real-time employment and income data 
for an individual. This would require FEMA to make system changes to 
interface with the company's data and add this additional verification 
against the self-reported income. The service provided by the company 
may be able to provide an applicant's current income, but it is unclear 
if that would accurately portray the household's annual income. 
Variance in household income immediately after a disaster is very 
common and there are a multitude of reasons why an applicant's reported 
income immediately after a disaster would not exactly match what is 
reported by the private sector credit reporting company. This option 
would not have a significant impact on the timing of the applicant's 
assistance, unless the private sector credit reporting company returns 
a higher income than what the applicant self-reported, in which case, 
the applicant would have to apply to SBA.
    FEMA also explored utilizing a credit check to determine which 
applicants should be referred to the SBA, rather than solely the FIT 
table. The SBA currently uses a credit check in the later stages of 
their loan application process and FEMA could mirror the credit score 
thresholds that the SBA has already developed to determine which 
applicants should be referred to SBA for further evaluation. FEMA would 
need to establish a contract with a third-party vendor that provides 
credit scores. Unlike the SBA, which utilizes detailed information from 
the credit report on the applicant's debts, FEMA would only need the 
credit score. As the credit check can be performed electronically and 
completed in real-time, it should not delay assistance to applicants. 
However, FEMA would need to inform applicants their credit may be 
checked when they apply for disaster assistance which could cause 
hesitation for some applicants to participate in the FEMA disaster 
assistance process and increase the barrier to assistance.
    Ultimately, none of the options FEMA explored to further verify 
applicant information will eliminate the longstanding inequitable 
barrier to access to the IHP presented by the SBA loan requirement. The 
requirement causes delay and confusion. FEMA has attempted to 
communicate the requirement more clearly; however, the confusion 
surrounding it has persisted. The historically low percentage of 
applicants with SBA-dependent needs identified at inspection who choose 
to apply for and accept an SBA loan for these needs indicates a gap in 
the correct recovery process which this change would address. Removal 
of the requirement addresses FEMA's obligation under Executive Order 
13985 and Executive Order 14091 to identify and address barriers to 
opportunities and benefits and aligns with the goal of the 2022-2026 
FEMA Strategic Plan to instill equity as a foundation of emergency 
management by removing barriers to FEMA programs through a people first 
approach and achieving equitable outcomes for those we serve.\275\ 
Removal of the requirement also aligns with certain of the comments 
received from the RFI and the conclusions reached by the GAO and will 
simplify applicant messaging for both FEMA and the SBA. Finally, 
removal of the requirement will allow applicants to receive the 
disaster assistance for which they have applied without being re-routed 
to fill out an SBA loan application first. Applicants will still have 
the option of applying for an SBA loan if the disaster assistance they 
receive does not meet their needs; as such, nothing is being taken away 
from disaster applicants and there are no reliance interests FEMA must 
consider in making the change.
---------------------------------------------------------------------------

    \275\ Strategic Goal 3.1 of the 2018-2022 FEMA Strategic Plan 
was to reduce the complexity of FEMA and to streamline the disaster 
survivor and grantee experience, which also would be furthered by 
these changes. The IFR also aligns with the 2022-2026 FEMA Strategic 
Plan, Goal 2: Lead whole of community in climate resilience; and 
Goal 3: Promote and sustain a ready FEMA and prepared Nation.
---------------------------------------------------------------------------

3. Housing Assistance
    Section 408 of the Stafford Act, 42 U.S.C. 5174, authorizes FEMA to 
provide housing assistance to applicants to respond to the disaster-
related housing needs of individuals and households who are displaced 
from their predisaster primary residences or whose predisaster primary 
residences are rendered uninhabitable, or with respect to individuals 
with disabilities, rendered inaccessible or uninhabitable, as a result 
of damage caused by a major disaster. A subcategory of housing 
assistance is home repair assistance which FEMA may provide to repair 
disaster-damaged owner-occupied primary residences to a safe and 
sanitary living or functioning condition.
    Prior to the changes in this IFR, 44 CFR 206.111 defined 
``uninhabitable'' to mean the dwelling is not safe, sanitary or fit to 
occupy, but did not directly define ``habitable'' or ``fit to occupy.'' 
FEMA defined ``safe'' as secure from disaster-related hazards or 
threats to occupants. FEMA defined ``sanitary'' as free of disaster-
related health hazards. FEMA defined ``functional'' as an item or home 
capable of being used for its intended purpose. In 44 CFR 
206.117(b)(2)(ii), FEMA provided a list of components of the home for 
which it would provide repair assistance. In 44 CFR 206.117(b)(2)(i), 
FEMA provided that FEMA will repair each component

[[Page 4022]]

if it was functional immediately before the disaster, damaged by the 
disaster, not covered by insurance, and the repair of the component was 
necessary to ensure the safety or health of the occupant or to make the 
residence functional. Repairs were limited to restoration of the 
dwelling to a safe and sanitary living or functioning condition. Repair 
assistance would only be provided to the extent that the work makes the 
component functional. 44 CFR 206.117(b)(2)(iii). Components that were 
functional immediately before the declared event may have been eligible 
for repair assistance if the damage to the component was caused by the 
disaster and the component was no longer functional. 44 CFR 
206.117(b)(2)(iv).
    These regulations reflected FEMA's interpretation that the Stafford 
Act's requirement that housing assistance be provided for ``disaster-
related'' needs prohibits FEMA from providing home repair assistance 
for pre-existing damage, which is where applicants have damage to their 
homes that occurred prior to the disaster and was not a result of the 
disaster or worsened by the disaster. FEMA has also referred to pre-
existing damage as ``deferred maintenance.''
    A version of the current language has been in place since 2002 when 
FEMA issued an NPRM \276\ proposing regulations creating the IHP to 
implement amendments to the Stafford Act from DMA2K.\277\ However, 
FEMA's 2002 version of the regulations governing home repair assistance 
was not explicit regarding FEMA's interpretation that the Stafford Act 
requires FEMA to identify and exclude pre-existing damage when 
calculating awards for home repair assistance.\278\ In 2008, FEMA was 
sued by disaster survivors from Hurricane Dolly who were denied home 
repair assistance as a result of FEMA's deferred maintenance 
determinations.\279\ The lawsuit alleged that FEMA's ``hidden and vague 
rules'' effectively prevented low-income families from accessing home 
repair assistance'' and ``institutionalize[d] economic 
discrimination.'' \280\ The Court held that FEMA had violated the APA 
by failing to publish the deferred maintenance policy and forbade FEMA 
to use it to adversely affect Hurricane Dolly disaster applicants.\281\
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    \276\ 67 FR 3412, Jan 23, 2002. The NPRM was implemented via an 
IFR. See 67 FR 61446, Sept. 30, 2002.
    \277\ Public Law 106-390, 114 Stat. 1552 (Oct. 30, 2000).
    \278\ 67 FR 3412, Jan 23, 2002 at proposed 44 CFR 206.108(b)(2) 
and 44 CFR 206.108(c)(1).
    \279\ La Union del Pueblo Entero (Lupe) v. FEMA, 2009 U.S. Dist. 
LEXIS 40368 (S.D. Tex., May 13, 2009).
    \280\ Id.
    \281\ Id.
---------------------------------------------------------------------------

    In 2012, FEMA issued a Notice of Proposed Rulemaking (NPRM) \282\ 
to clarify its interpretation of the statutory requirement that housing 
assistance under the Stafford Act be ``disaster-related'' by adding 
more specific limiting language to 44 CFR 206.117(b)(2) and explaining 
how it applied this interpretation to home repair assistance 
determinations. According to FEMA, the proposed text did not add new 
requirements; instead, it clarified the existing requirements.\283\ 
FEMA stated that it historically interpreted the requirement that 
damage must be ``disaster-related'' as it applied to components of a 
home by breaking the evaluation into two parts: (1) the component must 
have been functional immediately before the event; \284\ and (2) the 
component must have been damaged and made not functional by the 
event.\285\ FEMA added new language noting that the repair assistance 
would be provided ``only to the extent that it makes the component 
functional,'' stating ``FEMA does not provide repairs or replacement to 
further improve a component beyond making it functional.'' \286\ FEMA 
expanded on its general view of IHP by stating ``IHP is not a loss 
indemnification program and does not ensure that applicants are 
returned to their pre-disaster living conditions.'' \287\
---------------------------------------------------------------------------

    \282\ 77 FR 44562, July 30, 2012. The NPRM was implemented via a 
Final Rule. See 78 FR 66852, Nov. 7, 2013.
    \283\ Id.
    \284\ FEMA later expanded on this in the proposed rule to state 
that components did not need to be ``fully functional,'' nor was it 
``disqualifying if the component posed a risk before the event.'' In 
FEMA's view the key was that the component must have had some 
functionality before the event and incurred a change in 
functionality (must become unfunctional) as a result of the event.
    \285\ Id.
    \286\ Id.
    \287\ Id.
---------------------------------------------------------------------------

    These limitations have been a regular source of frustration for 
survivors and disaster recovery community members,\288\ highlighting 
the gap between FEMA's regulations and the expectation of what disaster 
assistance should, or could, cover.\289\ The limitations associated 
with pre-existing conditions means repair assistance has been limited 
to applicants with residences that incurred disaster damage but fall 
short of immediate safety and sanitation concerns without directly 
addressing or assessing the general livability issues. For example, 
certain components such as roofs may have sustained disaster damage but 
may also still leak from another area with pre-existing damage. Under 
its prior approach, FEMA would only pay to repair the disaster damage 
to the roof, not the pre-existing damage, which did not restore the 
home to a safe, sanitary living or functioning condition.
---------------------------------------------------------------------------

    \288\ See La Union del Pueblo Entero v. FEMA, 2009 U.S. Dist. 
LEXIS 40368 (S.D. Tex., May 13, 2009); Barbosa v. United States 
Dep't of Homeland Security, 916 F.3d 1068, 1073 (D.C. Cir. 2019).
    \289\ FEMA guidance also previously interpreted the requirement 
that the damage be ``caused by the disaster'' to exclude assistance 
for secondary effects of the disaster (e.g., mold, damage to 
subflooring, removing wet drywall to prevent water wicking further 
up and causing mold). FEMA's position was that mold is not a direct 
result of the disaster, rather a secondary effect caused by not 
removing, adequately drying out, or cleaning wet materials in the 
home, and thus not ``directly caused by the disaster.'' As such, 
FEMA only authorized a limited amount of assistance to remove 
damaged elements that might cause mold. However, FEMA's position on 
this was too narrow given that secondary effects would not occur but 
for the underlying disaster-caused damage. In 2021, FEMA reversed 
this policy position and authorized assistance to address secondary 
effects, such as mold. See page 9 of the Amendment to FP 104-009-03, 
Individual Assistance Program and Policy Guide, Version 1.1 
memorandum cites to Chapter 3, Section IV.E. of the IAPPG 1.1, which 
is on pages 85-88 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    At the time FEMA made these determinations, it may have made sense 
to limit assistance under IHP; however, Congress has since indicated 
clear intent to increase the amount of assistance FEMA provides to 
individuals and households.\290\ FEMA considered whether its approach 
could be altered to better address the needs of disaster survivors and 
to address livability issues. FEMA considered two options: (1) define 
``fit to occupy'' in guidance ensure consideration of general 
livability conditions at the time of inspection that, if left 
unaddressed, could potentially impact the home's habitability later in 
the disaster or after inspection, and authorize replacement for 
components that could not be repaired when considering the overall 
condition of the component; or (2) amend the regulations to remove the 
requirement for real property components to be functional immediately 
prior to the disaster so that FEMA could repair a component that 
sustained disaster damage to a safe, sanitary, and functioning 
condition without attempting to determine whether the component had 
pre-existing damage.
---------------------------------------------------------------------------

    \290\ See Public Law 106-390, 114 Stat. 1552 (Oct. 30, 2000); 
Post-Katrina Emergency Management Reform Act of 2006, 109-295, 120 
Stat. 1452 (Oct. 4, 2006) Disaster Recovery Reform Act of 2018, 
Public Law 115-254, 132 Stat. 3448 (Oct. 5, 2018), 42 U.S.C. 5174(h) 
supra, at notes 242-244.

---------------------------------------------------------------------------

[[Page 4023]]

    In the first option, FEMA considered putting forth a policy 
interpretation of what might make a residence ``unfit'' to occupy.\291\ 
Unfit is defined in legal terms as ``unsuitable; or not adapted or 
qualified for a particular use or service.'' \292\ In non-legal terms, 
unfit generally means ``not of the necessary quality or standard to 
meet a particular purpose;'' ``below the required standard;'' ``in poor 
condition;'' or ``not suitable; inappropriate.'' \293\ FEMA could have 
defined ``fit to occupy'' in guidance to address unsanitary or poor 
conditions that made a disaster damage home unsuitable for occupancy 
associated with the disaster-related impacts to the general livability 
conditions of the home to increase clarity for FEMA housing inspectors 
and disaster survivors. FEMA also considered whether it could authorize 
replacement for disaster-damaged components that had pre-existing 
damage, but could not be partially repaired. However, this approach 
would not fully remove the subjectivity associated with making 
habitability and repair decisions and would potentially overcompensate 
disaster survivors to replace items with pre-existing damage that could 
be repaired to a safe, sanitary living or functioning condition.
---------------------------------------------------------------------------

    \291\ As noted above, in regulation, FEMA defined 
``uninhabitable'' to mean the dwelling is not safe, sanitary or fit 
to occupy, but did not define ``fit to occupy.'' FEMA defined 
``safe'' as secure from disaster-related hazards or threats to 
occupants. FEMA defined ``sanitary'' as free of disaster-related 
health hazards.
    \292\ Black's Law Dictionary (4th pocket ed. 2011); see also 
Barron's Legal Guides Law Dictionary (2nd ed. 1984).
    \293\ Webster's Collegiate Dictionary (11th ed. 2003); Collins 
English Dictionary--Complete and Unabridged (12th ed. 2014); and 
American Heritage Dictionary of the English Language (5th ed. 2016).
---------------------------------------------------------------------------

    In the second option, FEMA considered amending its regulations to 
remove the specific requirements related to pre-existing damage so that 
it could better address livability conditions. This required FEMA to 
re-visit its earlier interpretations of statutory authority. Although 
the Stafford Act uses the term disaster-related, it is not applied 
specifically to the subcategory of repair assistance; instead, it 
applies generally to the initial determination of whether to provide 
housing assistance at all.\294\ FEMA may provide housing assistance to 
respond to the disaster-related needs of individuals who are displaced 
from their predisaster primary residences or whose predisaster 
residences are rendered uninhabitable as a result of damage caused by a 
major disaster. After FEMA determines that an applicant has cleared 
this initial hurdle, it determines the appropriate types of housing 
assistance to be provided to the applicant based on factors such as 
cost-effectiveness and convenience to the individual.\295\ As it 
applies specifically to home repair assistance, the Stafford Act states 
that FEMA may provide financial assistance for the repair of dwellings 
that were damaged by a major disaster to a safe and sanitary living or 
functioning condition.\296\ This does not require FEMA to discount pre-
existing damage; FEMA could read the Act to mean that uninhabitable 
dwellings which sustained some disaster damage could be repaired ``to'' 
a safe and sanitary living condition. Simply, as FEMA has accomplished 
with this IFR, FEMA may provide assistance to repair a dwelling with a 
mix of disaster damage and pre-existing damage on a dwelling component 
to a safe and sanitary living condition. Finally, FEMA previously 
interpreted functioning to mean ``functional'' means and applied it in 
a component-by-component fashion FEMA could instead acknowledge that 
the Stafford Act uses the term ``functioning'' as one of the options 
for the desired end state of the dwelling by authorizing FEMA to 
provide assistance to repair a disaster-damaged dwelling to a safe and 
sanitary living ``or'' functioning condition.
---------------------------------------------------------------------------

    \294\ 42 U.S.C. 5174(b)(1).
    \295\ 42 U.S.C. 5174(b)(2)(A).
    \296\ 42 U.S.C. 5174(c)(2)(A)(i).
---------------------------------------------------------------------------

    This IFR's changes to the definitions of ``uninhabitable,'' 
``safe,'' and ``sanitary,'' and the eligibility criteria for home 
repair assistance remove the regulatory limitations associated with 
pre-existing damage. Addressing this issue via amendment to the 
regulations more appropriately meets congressional intent that FEMA's 
assistance allows applicants to repair homes ``to'' a safe and sanitary 
living or functioning condition. Applicants will be in a better 
position to realistically recover from the disaster by receiving 
assistance to repair or replace real property components of the home 
that are not covered by insurance and are necessary to ensure the 
safety or health of the occupant. As a result, applicants will be less 
reliant on FEMA's other forms of housing assistance, such as temporary 
housing assistance, and will be able to return more quickly to a safe 
and functioning residence. This will expand assistance and address 
longstanding complaints that FEMA assistance does not adequately 
address survivor needs; as such, there are no reliance interests that 
FEMA considered in making these changes.
4. Serious Needs Assistance and Displacement Assistance
    FEMA has the authority under Section 408(e)(2) of the Stafford Act, 
42 U.S.C. 5174(e)(2), implemented as ONA at current 44 CFR 
206.119(c)(6)(ii), which provides that FEMA in consultation with the 
State may provide financial assistance for ``necessary expenses or 
serious needs.'' FEMA has determined that the most pressing necessary 
expenses and serious needs generally occur during the immediate 
aftermath of disasters. Individuals and households displaced from their 
homes often need immediate assistance to be able to pay for short-term 
lodging or serious needs. In some instances, the immediate funds would 
be sufficient to address the short-term needs and the individuals may 
be able to return to their pre-disaster residences without additional 
support.
    FEMA has established some short-term solutions for housing such as 
LER and initial rental assistance under its Stafford Act authority to 
provide temporary housing assistance at Section 408(c)(1)(A)(i), and it 
has offered expedited assistance for serious needs under its ONA 
authority at Section 408(e)(2) in the form of debit cards, or CNA. FEMA 
has, however, attached certain criteria to the eligibility for or 
expenditure of such assistance that has had the unintended consequence 
of impacting longer-term needs or resulting in the inequitable 
distribution of such benefits. FEMA provides LER via reimbursement for 
hotels, motels, or other short-term lodging while an applicant is 
displaced from his or her primary residence,\297\ which requires 
disaster applicants to have up-front funding for such expenses. FEMA 
provides initial rental assistance to eligible applicants but will only 
recertify applicants for continued rent assistance if they can submit 
rent receipts to show that they have exhausted the FEMA rent funds on 
rent.\298\ FEMA's statutory authority to provide temporary housing 
assistance requires that the financial assistance be used to rent 
``alternate housing accommodations, existing rental units, manufactured 
housing, recreational vehicles or other readily fabricated dwellings;'' 
\299\ as such, the requirements FEMA has placed upon applicants to 
prove that such assistance is, in fact, used for rent is a reasonable 
interpretation of the statute.
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    \297\ See page 44 IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \298\ 44 CFR 206.114(b)(2).
    \299\ 42 U.S.C. 5174(c)(1)(A)(i).

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[[Page 4024]]

    However, FEMA's previous interpretation has produced inequities in 
disaster events; FEMA has been sued by disaster applicants alleging 
that FEMA provided them with initial rental assistance without clearly 
explaining the purpose of the funds and, when applicants spent the 
funds on other necessities, FEMA denied them for continued temporary 
housing assistance because they could not produce receipts verifying 
the funds were spent on rent.\300\ While FEMA has continued to 
communicate the appropriate uses of initial rental assistance, the 
problem remains that disaster applicants have post-disaster serious 
needs aside from housing for which they need assistance.
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    \300\ Ridgley v. Fed. Emergency Mgmt. Agency, 2007 U.S. Dist. 
LEXIS 43002 (E.D. La., June 13, 2007).
---------------------------------------------------------------------------

    FEMA determined it could improve upon and expand its existing 
authority by establishing two new types of assistance to address 
immediate unmet needs under the IHP's ONA provision: Serious Needs 
Assistance and Displacement Assistance. Serious Needs Assistance and 
Displacement Assistance would both be subject to the ONA cost share and 
available for every disaster in which IHP is authorized. Applicants 
will have to meet all standard IHP eligibility criteria under 44 CFR 
206.113. FEMA will not require receipts documenting the use of the 
funds for either form of assistance. Serious Needs Assistance will take 
the place of CNA, and, in this improved version, FEMA may provide funds 
to eligible survivors to assist with the additional costs they incur 
due to being impacted or displaced by a disaster (including 
evacuation). Survivors would be able to use the funds for immediate or 
serious needs such as water, food, first aid, infant formula, diapers, 
personal hygiene items, or fuel for transportation. These needs will 
vary according to each applicant and FEMA will not require receipts 
documenting the use of this assistance. Serious Needs Assistance will 
be available for every disaster in which IHP is authorized instead of 
only being available in specific geographic areas upon the request of 
STT government.\301\ FEMA examined its past practice in providing 
similar payments and considered setting the assistance amount at the 
current amount provided for CNA ($500) or increasing it to $750 or 
$1000. At this time, FEMA believes increasing the amount to $750 \302\ 
would better cover immediate post-disaster serious needs based upon our 
prior experience with CNA.
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    \301\ Prior to this IFR, FEMA only provided CNA for a limited 
number of disasters and only in specific geographic areas when the 
STT government submits a written request, with justification, within 
14 days from the date of the disaster declaration. See page 164 
IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf. The STT government must demonstrate that 
applicants are displaced due to restrictions placed by STT 
government officials; shelters in the area do not meet the needs of 
the displaced population; and community and life-sustaining services 
within a reasonable distance are limited due to disaster-caused 
impact. Id.
    \302\ FEMA will adjust the amount of SNA to reflect changes in 
the CPI for all Urban Consumers that the Department of Labor 
publishes annually. 44 CFR 206.119(b)(1).
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    FEMA is establishing Displacement Assistance to provide funds for 
short-term living arrangements based on a timeframe established by FEMA 
and a nightly room rate approved in the State Administrative Option as 
required in Sec.  206.120(b). Displacement Assistance will be available 
for eligible survivors whose homes are uninhabitable to assist them 
with securing temporary lodging while they make repairs or pursue 
temporary housing. Applicants who receive Displacement Assistance can 
still request and receive Initial Rental Assistance when they are ready 
to move into temporary housing; however, FEMA created this assistance 
to fill a gap for disaster survivors who may not need long-term rental 
assistance.
    FEMA considered two options for limiting Serious Needs Assistance 
and Displacement Assistance. FEMA considered: (1) limiting the 
population who could receive Serious Needs Assistance to only those 
applicants who had been displaced by a disaster or who reported a need 
for shelter as a result of the disaster; or (2) limiting the geographic 
area that might be eligible for Serious Needs Assistance to only those 
areas with certain impacts. The first option would not meet the needs 
of disaster applicants who have immediate, unmet needs that are not 
caused by displacement. For example, if there are widespread power 
outages in an area that did not cause an applicant to be displaced, but 
might have caused refrigerated food or medicine to expire, an applicant 
might need immediate assistance to replace those necessary items. The 
second option would potentially delay the disbursement of Serious Needs 
Assistance beyond the initial disaster period to allow FEMA to gather 
information about the geographic impacts of the disaster. FEMA often 
does not have the detailed information necessary about the impacts of a 
disaster in its immediate aftermath to make such geographic 
determinations. Such a delay would frustrate the intent to provide 
immediate assistance and may compound the effects of unmet serious 
needs.
    There are multiple benefits to improving FEMA's implementation of 
these types of immediate needs assistance. Lower-income groups and 
minorities suffer disproportionately from disaster and recover less 
quickly than more privileged residents. Natural disasters can compound 
existing inequities and act as tipping points, consuming savings, and 
pushing households into financial and economic insecurity. According to 
the Federal Reserve, 32 percent of Americans could not cover an 
emergency expense of $400 with cash or its equivalent, with 11 percent 
saying they would be unable to pay the expense by any means.\303\ 
FEMA's establishment of Serious Needs Assistance and Displacement 
Assistance will allow eligible disaster applicants to apply for and 
quickly receive an initial tranche of each form of assistance to help 
with the immediate serious needs and necessary expenses after a 
disaster. Disaster applicants will have more flexibility to choose the 
form of short-term lodging that best suits their needs, to include 
staying with friends and family and offsetting their expenses, which 
should decrease shelter usage. Displacement assistance is a more 
equitable and efficient way of providing short-term lodging assistance 
than LER,\304\ which is an administratively burdensome reimbursement 
action that benefits those who have the means to pay their hotel bills 
up front, rather than those applicants who do not have such funds 
available. FEMA hopes to address the need many disaster survivors have 
for short-term transitional assistance, when there is no need for 
longer-term rental assistance. The changes align with the 2022-2026 
FEMA Strategic Goal 1 to instill equity as a foundation of emergency 
management by removing barriers to FEMA programs through a people first 
approach and achieving equitable outcomes for those we serve.\305\ The 
changes also support IA

[[Page 4025]]

Strategic Plan Objective 1.1 to prioritize and evolve service delivery, 
and IA Strategic Plan Objective 1.3 to enhance program delivery. These 
changes will expand assistance and address complaints that FEMA 
assistance does not adequately address immediate, unmet applicant 
needs; as such, there are no disaster applicant reliance interests that 
FEMA considered in making these changes. STTs cannot allege a reliance 
interest associated with future benefits they might request in a 
discretionary disaster grant program.
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    \303\ Federal Reserve Board, Report on the Economic Well-Being 
of U.S. Households 2021, Figures 19 and 20, https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm.
    \304\ FEMA in this IFR states that Displacement Assistance is in 
lieu of LER and only those displaced applicants who do not receive 
Displacement Assistance may receive LER.
    \305\ Strategic Goal 3.1 of the 2018-2022 FEMA Strategic Plan, 
to streamline the disaster survivor and grantee experience, also 
would be furthered by these changes. The IFR also aligns with the 
2022-2026 FEMA Strategic Plan, Goal 2: Lead whole of community in 
climate resilience; and Goal 3: Promote and sustain a ready FEMA and 
prepared Nation.
---------------------------------------------------------------------------

IV. Discussion of the Interim Final Rule

A. Section 206.101--Temporary Housing Assistance for Emergencies and 
Major Disasters Declared on or Before October 14, 2002

    On September 30, 2002, FEMA issued regulations on the then-new 
Individuals and Households Program.\306\ The rule implemented DMA2K 
\307\ and added Sec. Sec.  206.110-120 to subpart D of part 206 of 
FEMA's regulations.\308\ The previous regulations, relating to the 
superseded Individual and Family Grant Program, were retained in Sec.  
206.101, but revised to apply only to disasters declared before October 
15, 2002, the applicability date of the new Individuals and Households 
Program regulations.\309\ Since these old regulations are now outdated 
and no longer necessary, FEMA removes and reserves Sec.  206.101. 
Sections 206.102 through 206.109 are currently reserved, so removing 
and reserving Sec.  206.101 will extend the existing reservation to 
Sec. Sec.  206.101-109.
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    \306\ 67 FR 61446, Sept 30, 2002.
    \307\ Public Law 106-390, 114 Stat. 1552 (Oct. 30, 2000).
    \308\ See 67 FR 61446, 61452.
    \309\ See Id. at 61460.
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B. Section 206.110--Federal Assistance to Individuals and Households

    In the first sentence of Sec.  206.110(a), FEMA states that this 
section implements the policy and procedures set forth in the Robert T. 
Stafford Disaster Relief and Emergency Assistance Act, as amended 
(Stafford Act), 42 U.S.C. 5174. This is consistent with the first 
sentence of current Sec.  206.110(a), except for FEMA removing 
``section 408 of;'' adding ``as amended (Stafford Act)'' for clarity; 
and removing ``as amended by the Disaster Mitigation Act of 2000'' for 
clarity. FEMA makes these edits for public ease of reference, as a 
United States Code cite is more accessible to the public and 
referencing the section of the Stafford Act only increases the length 
of the regulation. Plus, there have been many amendments to the 
Stafford Act since DMA2K. Instead of including all of the amendments to 
the Stafford Act, FEMA removes the reference to DMA2K and uses ``as 
amended.''
    In the first sentence of Sec.  206.110(b), FEMA states that no 
individual or household will receive financial assistance greater than 
$25,000 under subpart D with respect to a single major disaster or 
emergency for the repair or replacement of their pre-disaster primary 
residence. This is consistent with the first sentence of current Sec.  
206.110(b), except for FEMA adding the phrase ``for the repair or 
replacement of their pre-disaster primary residence'' to codify section 
1212 of the DRRA which amended 408(h) of the Stafford Act, 42 U.S.C. 
5174, to remove Temporary Housing Assistance from any financial maximum 
retroactive to disasters declared on or after August 1, 2017. Thereby, 
financial assistance for temporary housing expenses are no longer 
limited to a maximum award amount. Financial assistance for home repair 
and replacement for owner-occupied homes is still limited to a maximum 
award amount.
    FEMA adds a new second sentence to Sec.  206.110(b), FEMA states 
that no individual or household will receive financial assistance 
greater than $25,000 under subpart D with respect to a single major 
disaster or emergency for Other Needs Assistance. FEMA adds this new 
language for clarity since section 1212 of the DRRA amended 408(h) of 
the Stafford Act, 42 U.S.C. 5174, by separating ONA, so ONA and Home 
Repair Assistance/Home Replacement Assistance have equal, independent 
financial maximums retroactive to disasters declared on or after August 
1, 2017.
    In the third sentence (currently the second sentence) of Sec.  
206.110(b), FEMA states that FEMA will adjust the $25,000 limits 
annually to reflect changes in the Consumer Price Index (CPI) for All 
Urban Consumers that the Department of Labor publishes. This is 
consistent with the current second sentence of Sec.  206.110(b), except 
for FEMA replacing ``limit'' with ``limits'' for grammar purposes, 
since there are multiple $25,000 limits that FEMA adjusts annually.
    FEMA adds a new paragraph (b)(1) to Sec.  206.110 stating that the 
maximum amount of financial assistance excludes rental assistance under 
Sec.  206.117(b)(1)(i) and lodging expense reimbursement under Sec.  
206.117(b)(1)(i). FEMA adds this new language for clarity; as, Rental 
Assistance and Lodging Expense Reimbursement are not counted toward the 
financial housing assistance maximum award.
    FEMA adds a new paragraph (b)(2) to Sec.  206.110 stating that the 
maximum amount of financial assistance excludes expenses to repair or 
replace eligible damaged accessibility-related real property 
improvements and personal property for individuals with disabilities. 
FEMA adds this new language for clarity since section 1212 of the DRRA 
removed financial assistance maximum award limits for accessibility-
related real and personal property items for applicants with 
disabilities. IAPPG 1.1 references specific disaster-damaged 
accessibility real property items that can be paid in addition to the 
financial assistance maximum award amount for Housing Assistance 
(Chapter 3: IV.E. Home Repair Assistance).\310\ Also, IAPPG 1.1 
currently references specific disaster-damaged accessibility personal 
property items that can be paid in addition to the financial assistance 
maximum award amount for ONA (Chapter 3: VI.A.1. Amount of Assistance.) 
\311\
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    \310\ See page 86 IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \311\ See page 146 IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    In the second sentence of Sec.  206.110(c), FEMA states that FEMA 
will determine the appropriate types of housing assistance to be 
provided under Sec.  206.110 based on considerations of cost 
effectiveness, convenience to the individuals and households and the 
suitability and availability of the types of assistance. This is 
consistent with the current second sentence of Sec.  206.110(c), except 
for FEMA revising ``shall'' to ``will'' for purposes of plain language.
    In the fourth sentence of Sec.  206.110(c), FEMA states that 
temporary housing and repair assistance must be utilized to the fullest 
extent practicable before other types of housing assistance. This is 
consistent with the current fourth sentence of Sec.  206.110(c), except 
for FEMA revising ``shall'' to ``must'' for purposes of plain language.
    In Sec.  206.110(d), FEMA states that eligibility for Federal 
assistance under subpart D is limited to losses or expenses resulting 
from damage that occurred during the dates of the incident period 
established in a presidential declaration that a major disaster or 
emergency exists, except that reasonable lodging expenses that are 
incurred in anticipation of and immediately preceding such event may be 
eligible for Federal assistance under

[[Page 4026]]

Chapter I. This is consistent with current Sec.  206.110(d), except for 
FEMA replacing ``will begin on'' with ``is limited to losses or 
expenses resulting from damage that occurred during the dates'' and 
replacing ``that results'' with ``period established'' for clarity. 
With these edits FEMA is trying to identify that the damage must have 
occurred in the incident period, not necessarily all the losses or 
expenses.
    In the second sentence of Sec.  206.110(e), FEMA states that the 
Assistant Administrator for the Recovery Directorate may extend the 
period of assistance if he/she determines that due to extraordinary 
circumstances an extension would be in the public interest. This is 
consistent with current second sentence Sec.  206.110(e), except for 
FEMA's technical edit of replacing ``Disaster Assistance'' with 
``Recovery,'' as it represents a past FEMA organization change and 
replacing ``this period'' with ``the period of assistance'' to align 
with the paragraph heading (e), period of assistance.
    In the first sentence of Sec.  206.110(h), FEMA states that in 
accordance with the requirements of the Stafford Act, 42 U.S.C. 5155, 
FEMA will not provide assistance under subpart D when any other source 
has already provided such assistance or when such assistance is 
available from any other source. This is consistent with the first 
sentence of current Sec.  206.110(h), except for FEMA removing 
``section 312 of'' since referencing the section of the Stafford Act 
just increases the length of the regulation.
    FEMA removes current Sec.  206.110(h)(2), which states ``applicable 
benefits are exhausted,'' as it is unnecessary, since an applicant does 
not have to exhaust benefits as a condition for FEMA to provide 
assistance to insured applicants under subpart D. FEMA's current 
regulations assume this is necessary to prevent a duplication of 
benefits, but FEMA will only be providing assistance for items or 
repairs that are not covered or adequately addressed by the applicant's 
insurance, so it should not be necessary for them to exhaust their 
insurance benefits before they receive IA.
    FEMA is not providing applicants all of the money they need for 
their recovery. The eligibility factor regulations at Sec.  
206.113(a)(5) already ensure that applicants accept all assistance from 
other sources for which they are eligible and that they accept all 
assistance from their insurance, if they have any.
    Section 206.110(h)(2) is consistent with current Sec.  
206.110(h)(3), except for the change to the paragraph structure.
    In Sec.  206.110(h)(3), FEMA states that, among other exceptions to 
the principle that FEMA will not provide assistance when assistance is 
available from any other source, FEMA may provide assistance to insured 
applicants when applicants cannot use their insurance because there is 
no housing on the private market. This is consistent with current Sec.  
206.110(h)(4), except FEMA replaced ``housing is not available'' with 
``applicants cannot use their insurance because there is no housing'' 
for clarity.
    In Sec.  206.110(i)(1), FEMA states that except as provided in 
Sec.  206.110(i)(2), the Federal share of eligible costs paid under 
subpart D is 100 percent. This is consistent with current Sec.  
206.110(i)(1), except for FEMA replacing ``shall be'' with ``is'' for 
purposes of plain language.
    In Sec.  206.110(i)(2) through the first sentence of Sec.  
206.110(i)(2)(ii), FEMA states that Federal and State cost shares for 
``Other Needs'' assistance under the Stafford Act, 42 U.S.C. 5174(e) 
and (f), are as follows: the Federal share is 75 percent; and the non-
Federal share is 25 percent and must be paid from funds made available 
by the State. This is consistent with the current Sec.  206.110(i)(2) 
through the first sentence of Sec.  206.110(i)(2)(ii), except for FEMA 
removing ``subsections 408 (e) and (f) of'' and adding ``42 U.S.C. 
5174(e) and (f),'' for public accessibility; replacing ``will be'' with 
``are,'' ``shall be'' with ``is,'' and ``replacing ``shall'' with 
``must'' for purposes of plain language; and adding ``is 25 percent 
and'' after ``non-Federal share'' for clarity.
    In the second sentence of Sec.  206.110(i)(2)(ii), FEMA states that 
if the State does not provide the non-Federal share to FEMA before FEMA 
begins to provide assistance to individuals and households under the 
Stafford Act, 42 U.S.C. 5174(e), FEMA will still process applications. 
This is consistent with the second sentence in current Sec.  
206.110(i)(2)(ii), except for FEMA removing ``subsection 408(e) of'' 
and adding ``42 U.S.C. 5174(e),'' for ease of reference, as a United 
States Code cite is more accessible to the public and referencing the 
section of the Stafford Act just increases the length of the 
regulation.
    In the fourth sentence of Sec.  206.110(i)(2)(ii), FEMA states that 
if the State does not provide such reimbursement on a monthly basis, 
then FEMA will issue a billing notice to the State on a monthly basis 
for the duration of the program. This is consistent with the fourth 
sentence of current Sec.  206.110(i)(2)(ii), except for FEMA replacing 
``Bill for Collection'' with ``billing notice'' for clarity. The United 
States Treasury Department (Treasury) tends to use the term ``billing 
notices'' when referring to these documents,\312\ so FEMA is adopting 
that term here to avoid confusion.
---------------------------------------------------------------------------

    \312\ See, e.g., Treasury Dept., Managing Federal Receivables, 
Chapter 6: Delinquent Debt Transparency, at 6-4 (March 2015), 
https://fiscal.treasury.gov/files/dms/chapter6.pdf.
---------------------------------------------------------------------------

    In the fifth sentence of Sec.  206.110(i)(2)(ii), FEMA states that 
FEMA will charge interest, penalties, and administrative costs on 
delinquent billing notices in accordance with the Debt Collection 
Improvement Act. This is consistent with the fifth sentence of current 
Sec.  206.110(i)(2)(ii), except for FEMA replacing ``administrative 
fees'' with ``administrative costs'' and replacing ``Bills for 
Collection'' with ``billing notices'' for clarity. Treasury uses the 
terms ``costs'' and ``administrative costs'' instead of ``fees'' and 
``administrative fees'' in the debt collection context,\313\ so FEMA is 
adopting that terminology here to avoid confusion.
---------------------------------------------------------------------------

    \313\ See, e.g., Id. at 6-15; 31 U.S.C. 3717(e)(1); and 31 CFR 
901.9(c).
---------------------------------------------------------------------------

    In the sixth sentence of Sec.  206.110(i)(2)(ii), FEMA states that 
cost shared funds, interest, penalties and administrative costs owed to 
FEMA through delinquent billing notices may be offset from other FEMA 
disaster assistance programs (i.e., Public Assistance) from which the 
State is receiving assistance, or future grant awards from FEMA or 
other Federal Agencies. This is consistent with the sixth sentence in 
current Sec.  206.110(i)(2)(ii), except for FEMA replacing ``fees'' 
with ``administrative costs,'' replacing ``Bills for Collections'' with 
``billing notices,'' and adding ``assistance'' after ``receiving'' for 
clarity.
    In Sec.  206.110(j)(2), FEMA states that under the Stafford Act, 42 
U.S.C. 5174(f)(2), FEMA must share applicant information with States in 
order for the States to make available any additional State and local 
disaster assistance to individuals and households. This is consistent 
with current Sec.  206.110(j)(2), except for FEMA removing ``section 
408(f)(2) of'' since referencing the section of the Stafford Act only 
increases the length of the regulation.
    In Sec.  206.110(j)(2)(ii), FEMA states that States receiving such 
applicant information must not further disclose the information to 
other entities, and must not use it for purposes other than providing 
additional State or local disaster assistance to individuals and 
households. This is consistent with current Sec.  206.110(j)(2)(ii), 
except for FEMA replacing ``must'' with ``shall'' in

[[Page 4027]]

two places in the sentence for purposes of plain language.
    In the first sentence of Sec.  206.110(k)(2), FEMA states that 
individuals or households that are located in a special flood hazard 
area may not receive Federal Assistance for National Flood Insurance 
Program (NFIP)--insurable real and/or personal property, damaged by a 
flood, unless the community in which the property is located is 
participating in the NFIP (See 44 CFR 59.1), or the exception in 42 
U.S.C. 4105(d) applies. This is consistent with the first sentence in 
current Sec.  206.110(k)(2), except for FEMA replacing ``(See 44 CFR 
part 59.1)'' with ``(See 44 CFR 59.1)'' as a technical correction since 
the cross cite is a section and not a part.
    In the first sentence of Sec.  206.110(k)(3)(i), FEMA states that 
as a condition of the assistance and in order to receive any Federal 
assistance for future flood damage to any insurable property, 
individuals and households named by FEMA as eligible recipients under 
the Stafford Act, 42 U.S.C. 5174, who receive assistance, due to flood 
damage, for acquisition or construction purposes under subpart D must 
buy and maintain flood insurance, as required in 42 U.S.C. 4012a, for 
at least the assistance amount. This is consistent with the current 
first sentence of Sec.  206.110(k)(3)(i), except for FEMA removing 
``section 408 of'' to decrease the length of the regulations; adding 
``42 U.S.C. 5174'' for accessibility; and revising ``damages'' to 
``damage'' for grammar purposes.
    In the first sentence of Sec.  206.110(k)(3)(i)(A), FEMA states 
that if the applicant is a homeowner, flood insurance coverage must be 
maintained at the address of the flood-damaged property for as long as 
there is a residential building (See 44 CFR 59.1) at the address. This 
is consistent with the current first sentence of Sec.  
206.110(k)(3)(i)(A), except for FEMA adding ``there is a residential 
building (See 44 CFR 59.1) at'' before ``the address'' and removing 
``exists'' for clarity. An address does not ``exist.'' Rather, the 
language, for as long as there is a residential building at the 
address, is more precise.
    In Sec.  206.110(m), FEMA states that assistance provided under 
subpart D generally does not have the potential to affect historic 
properties and thus FEMA has no further obligations under the National 
Historic Preservation Act, 54 U.S.C. 306108, with the exception of 
ground disturbing activities and construction related to Sec. Sec.  
206.117(b)(1)(ii) (direct housing), 206.117(b)(2)(ii)(F) (repair 
assistance for privately owned roads and bridges), 206.117(b)(3) 
(replacement assistance), and 206.117(b)(4) (permanent housing 
construction.) This is consistent with current Sec.  206.110(m), except 
for FEMA replacing ``is exempted from review in accordance with section 
106 of'' with ``FEMA has no further obligations under'' for clarity and 
since referencing the section of the National Historic Preservation Act 
only increases the length of the regulation; adding ``54 U.S.C. 
306108'' for ease of reference; replacing ``Temporary'' with 
``direct,'' adding ``206.117(b)(2)(ii)(F) (repair assistance for 
privately owned roads and bridges),'' and replacing ``Replacement 
housing'' with ``replacement assistance'' for clarity; and replacing 
``Permanent housing construction'' with ``permanent housing 
construction'' to align with section formatting.
    With regard to the changes in Sec.  206.110(m), the National 
Historic Preservation Act, 54 U.S.C. 306108, states that the head of 
any Federal agency having direct or indirect jurisdiction over a 
proposed Federal undertaking or federally assisted undertaking in any 
State, prior to the approval of the expenditure, shall take into 
account the effect of the undertaking on any historic property. If the 
undertaking is a type of activity that does not have the potential to 
cause effects on historic properties, assuming such historic properties 
were present, the agency official has no further obligations under 
Section 106 of the National Historic Preservation Act. Based on over 20 
years of practice, since Sec.  206.110(m) was published, FEMA has 
determined that the proposed undertaking, excluding the stated 
exceptions, does not have the potential to cause effects on historic 
properties. Therefore, FEMA changes the language in Sec.  206.110(m) to 
align it with the applicable statutory and regulatory language (i.e., 
36 CFR 800.3(a)(1)).
    In Sec.  206.110(n), FEMA adds a new paragraph heading of 
``Severability'' for consistency with standards established by the 
Federal Register. FEMA is adding new paragraph Sec.  206.110(n) stating 
any provision of subpart D held to be invalid or unenforceable as 
applied to any person or circumstance should be construed so as to 
continue to give the maximum effect to the provision permitted by law, 
including as applied to persons not similarly situated or to dissimilar 
circumstances, unless such holding is that the provision of subpart D 
is invalid and unenforceable in all circumstances, in which event the 
provision should be severable from the remainder of subpart D and 
should not affect the remainder thereof.
    A severability clause is a standard legal provision. It indicates 
FEMA's intent that if a court finds that a specific provision of a rule 
is unlawful, the court should allow the remainder of the rule to 
survive. Those provisions that are unaffected by a legal ruling can be 
implemented by an agency without requiring a new round of rulemaking 
simply to promulgate provisions that are not subject to a court ruling.
    FEMA is publishing this IFR to amend its regulations governing the 
Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program. Specifically, the IFR 
increases eligibility for home repair assistance by amending the 
definitions and application of the terms safe, sanitary, and 
functional, allowing assistance for certain accessibility-related 
items, and amending its approach to evaluating insurance proceeds; 
allows for the re-opening of the applicant registration period when the 
President adds new counties to the major disaster declaration; 
simplifies the documentation requirements for continued temporary 
housing assistance; simplifies the appeals process; simplifies the 
process to request approval for a late registration; removes the 
requirement to apply for a Small Business Administration loan as a 
condition of eligibility for ONA; and establishes additional eligible 
assistance under ONA for serious needs, displacement, disaster-damaged 
computing devices and essential tools for self-employed individuals. 
FEMA also makes revisions to reflect changes to statutory authority 
that have not yet been implemented in regulation, to include provisions 
for utility and security deposit payments, lease and repair of 
multifamily rental housing, child care assistance, maximum assistance 
limits, and waiver authority.
    FEMA believes that its authority to implement each of these 
provisions is well-supported in law and practice and should be upheld 
in any legal challenge. FEMA also believes that its exercise of its 
authority reflects sound policy. However, in the event that any portion 
of the interim final rule is declared invalid, FEMA intends that the 
various provisions be severable. The provisions are not so 
interconnected that the rule's efficacy depends on every one of them 
remaining in place--implementation of the different provisions is 
sufficiently distinct that FEMA's aim of increasing equity and easing 
entry to the IA Program would still be furthered by

[[Page 4028]]

maintaining the other provisions. For example, if a court were to find 
unlawful the changes to insurance proceeds, the remaining provisions of 
the interim final rule, such as those on CTHA and security deposit 
payments, could still function sensibly and FEMA would still intend 
them to stand.

C. Section 206.111--Definitions

    In Sec.  206.111, FEMA adds terms for ``Destroyed,'' ``Essential 
tools,'' ``Recertification,'' ``Repairs,'' and ``State'' and to revise 
the definitions of ``Alternative housing resources,'' ``Dependent,'' 
``Displaced applicant,'' ``Eligible hazard mitigation measures,'' 
``Fair market rent,'' ``Financial ability,'' ``Functioning,'' ``Housing 
costs,'' ``Manufactured housing sites,'' ``Owner-occupied,'' 
``Permanent housing plan,'' ``Reasonable commuting distance,'' 
``Safe,'' ``Sanitary,'' ``Serious need,'' and ``Uninhabitable.''
    Alternative housing resources. FEMA revises the term ``Alternative 
housing resources'' to mean any housing that is available or can 
quickly be made available in lieu of permanent housing construction and 
is cost-effective when compared to permanent construction costs. Some 
examples are rental resources, manufactured housing units, and travel 
trailers. This is consistent with the current definition of 
``Alternative housing resources'' except for FEMA replacing ``mobile 
homes'' with ``manufactured housing units,'' after ``rental 
resources.'' FEMA makes these changes to align with HUD's regulations 
and FEMA has moved away from the term ``mobile home'' generally, except 
when referring to a pre-disaster mobile home that an applicant may have 
occupied and to add an Oxford comma to the list of examples for grammar 
purposes.
    Dependent. FEMA revises the term ``Dependent'' to mean someone who 
is normally claimed as such on the Federal tax return of another, 
according to the Internal Revenue Code. It may also mean the minor 
children of a couple not living together, where the children live in 
the affected residence with the parent or guardian who does not claim 
them on the tax return. This is consistent with the current definition 
of ``Dependent,'' except for FEMA removing ``actually'' before 
``claim'' for clarity.
    Destroyed. FEMA defines the term ``Destroyed'' to mean the primary 
residence is a total loss or damaged to such an extent that repairs are 
infeasible. IAPPG 1.1 at Chapter 3: IV.G.1. considers a residence 
destroyed when: disaster-caused damage necessitates the replacement of 
the majority of two or more major structural components (e.g., basement 
walls/foundation, load-bearing walls, or roof assembly have collapsed); 
the disaster has completely removed the above-grade structure and only 
the foundation remains; flood waters have reached the roof, inundating 
the majority of the structure's living area; the dwelling is in 
imminent threat of collapse because of disaster-caused damages; in the 
case of mobile homes and or travel trailers, when the frame is visibly 
bent or twisted and releveling is not possible; or repair is not 
feasible, and replacement is necessary to ensure the safety or health 
of the occupant or make the residence functional.\314\ FEMA knows that 
the IAPPG 1.1 definition is too long for a regulatory definition, so 
FEMA drafted the more succinct definition of ``destroyed.''
---------------------------------------------------------------------------

    \314\ See page 91 IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Displaced applicant. FEMA revises the term ``Displaced applicant'' 
to mean one whose disaster-damaged primary residence is uninhabitable, 
inaccessible, or made unavailable by the landlord. This is consistent 
with the current definition of the term ``Displaced applicant,'' except 
for FEMA adding ``disaster damaged'' before ``primary residence'' for 
clarity as the Stafford Act requires the home to be rendered 
``uninhabitable'' by disaster damage; adding ``or'' before the clause 
``made unavailable by the landlord'' for clarity; and removing the 
clauses ``(to meet their disaster housing need)'' and ``or not 
functional as a direct result of the disaster and has no other housing 
available in the area, i.e., a secondary home or vacation home.'' The 
removal of the clauses have two different reasons. FEMA's definition of 
``Uninhabitable'' (not safe, sanitary or fit to occupy) does not 
mention functioning or functional as a factor for determining whether 
the home is uninhabitable. The Stafford Act makes ``functioning 
condition'' a part of the habitability standard for repair assistance. 
Specifically, repairs must restore the home to a safe, sanitary or 
functioning condition. There is no requirement for the home to be not 
functioning; only that the home be owner-occupied as the primary 
residence before the disaster and rendered uninhabitable by the 
disaster damage. Secondly, since the ineligibility factors are included 
in Sec.  206.113, it seems unnecessary and repetitive to include the 
additional explanatory information of ``i.e., a secondary home or 
vacation home'' in the definition of displaced applicant.
    Eligible hazard mitigation measures. FEMA revises the term 
``Eligible hazard mitigation measures'' to mean home improvements that 
an applicant can accomplish in order to reduce or prevent future 
disaster damage to the primary residence, utilities, or infrastructure. 
This is consistent with the current definition of ``Eligible hazard 
mitigation measures,'' except for FEMA replacing the phrase ``essential 
components of the home'' with ``the primary residence, utilities, or 
infrastructure'' for clarity. FEMA does not have a definition for the 
phrase ``essential components of the home,'' but Sec.  
206.117(b)(2)(ii)(H) currently refers to ``eligible hazard mitigation 
measures'' and includes the clarifying words ``that reduce the 
likelihood of future damage to the residence, utilities, or 
infrastructure.'' FEMA is replacing the undefined phrase in Sec.  
206.111, with the phrase that FEMA has been using in Sec.  
206.117(b)(2)(ii)(H), ``the residence, utilities, or infrastructure,'' 
with the small revision of adding ``primary'' before ``residence'' as 
``primary residence'' is the defined term in the IHP regulations.
    Essential tools. FEMA defines the term ``Essential tools'' to mean 
tools and equipment required for employment and items required for 
education. This definition of ``Essential tools'' is consistent with 
the current definition of Essential tools in Chapter 3: VI.C.1. of 
IAPPG 1.1 except that it replaces the phrases ``required by an employer 
as a condition of'' and ``required as a condition of an applicant's or 
household member's'' with ``required for'' so that it parallels the ONA 
regulatory text at Sec. Sec.  206.119(b)(6)(iv) and 206.119(b)(6)(v) 
for consistency.\315\
---------------------------------------------------------------------------

    \315\ See page 167 IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Fair market rent. FEMA revises the term ``Fair market rent'' to 
mean estimates of rent plus the cost of utilities, except telephone, 
identified by the Department of Housing and Urban Development as being 
adequate for existing rental housing in a particular geographic area. 
This is consistent with the current definition of fair market rent, 
except for FEMA removing the following part of the current first 
sentence of the definition: ``housing market wide estimates of rents 
that provide opportunities to rent standard quality housing throughout 
the geographic area in which rental housing units are in competition'' 
for simplicity and removing the following phrase from the beginning of 
the current second sentence of the definition, ``the fair

[[Page 4029]]

market'' for simplicity; adding the phrase ``estimates of rent plus the 
cost of utilities, except telephone'' to more closely mirror HUD's 
definition of FMR and adding ``geographic'' before ``area'' for 
clarity.
    Financial ability. Currently, FEMA's definition of ``Financial 
ability'' only applies to the requirement that applicants whose incomes 
were impacted by the disaster can afford to pay 30 percent of their 
income toward housing. Applicants whose income was not impacted are 
expected to be able to pay the dollar amount they paid pre-disaster. 
When computing financial ability, extreme or unusual financial 
circumstances may be considered by the RA. FEMA has been applying the 
concept that all applicants requesting Continued Temporary Housing 
Assistance have the financial ability to pay up to 30 percent of their 
income toward housing to all applicants requesting CTHA since 2002, to 
treat applicants consistently.
    FEMA revises the term ``Financial ability'' to mean the applicant's 
capability to pay 30 percent of gross post-disaster household income 
for housing. When computing financial ability, extreme or unusual 
financial circumstances may be considered by FEMA. This is consistent 
with the current definition of the term ``Financial ability,'' except 
for FEMA moving the clause ``30 percent of gross post-disaster income 
for housing'' to earlier in the definition, replacing ``the Regional 
Administrator'' with ``FEMA'' to ensure continued consistency in 
processing across disasters at the national level when computing 
``Financial ability'' in extreme or unusual financial circumstances, 
and removing the second and third sentences of the current definition.
    Functioning. FEMA revises the term from ``Functional'' to 
``Functioning'' for clarity and FEMA states that the definition remains 
the same. Functioning means an item or home capable of being used for 
its intended purpose.
    Housing costs. FEMA revises the term ``Housing costs'' to mean rent 
and mortgage payments, including principal, interest, real estate 
taxes, real property insurance, homeowners or condominium association 
fees, and utility costs. This is consistent with the current definition 
of the term ``Housing costs,'' except for FEMA adding ``homeowners or 
condominium association fees'' to codify the current practice.
    Manufactured housing sites. FEMA revises the term ``Manufactured 
housing sites'' to mean those sites used for the placement of travel 
trailers and other manufactured housing units, including:
    (1) Commercial site, a site customarily leased for a fee, which is 
fully equipped to accommodate a housing unit;
    (2) Private site, a site that the applicant provides or obtains at 
no cost to the Federal Government, complete with utilities; and
    (3) Group site, a site provided by the State or local government or 
FEMA, if determined that such site would be more economical or 
accessible than one that the State or local government provides, that 
accommodates two or more units and is complete with utilities.
    This is consistent with the current definition of the term 
``Manufactured housing sites,'' except for FEMA removing the phrase 
``government or privately owned mobile homes'' for clarity and deleting 
the comma after ``travel trailers'' for grammar purposes. FEMA deletes 
``government or privately owned'' as there is not something other than 
government or privately owned. FEMA deletes ``mobile homes'' to align 
with HUD's regulations and as FEMA has moved away from the term 
``mobile home'' generally, except when referring to a pre-disaster 
mobile home that an applicant may have occupied.
    Also, the above definition is consistent with the current 
definition of the subterm ``Group site,'' except for FEMA adding ``or 
FEMA, if determined that such site would be more economical or 
accessible than one that the State or local government provides'' 
before ``that'' for clarity and consistency. Currently, Sec.  
206.117(b)(1)(ii)(E)(4) covers a group site provided by FEMA and it 
includes the language that ``such a site would be more economical or 
accessible than one that the State or local government provides,'' so 
for consistency FEMA adds the limitations of when FEMA will provide a 
group site to the revisions to the definition.
    Owner-occupied. FEMA revises the term ``Owner-occupied'' to mean 
that the residence is occupied by:
    (1) The legal owner with verifiable documentation; or
    (2) A person who does not hold formal title to the residence and 
pays no rent, but can produce verifiable documentation demonstrative of 
legal responsibility including tax payment receipts; receipts for major 
repairs, maintenance, or improvements of the residence; court 
documents, a letter from a public official, or, for mobile home or 
travel trailer owners residing in a commercial park, a letter from the 
mobile home park owner or manager; or
    (3) A person who has verifiable documentation of lifetime occupancy 
rights with formal title vested in another.
    This is consistent with the current term ``Owner-occupied,'' except 
for FEMA adding ``with verifiable documentation; or '' after ``legal 
owner'' in paragraph (1) for clarity and to avoid being overly 
limiting; adding ``verifiable documentation of '' before ``lifetime'' 
in paragraph (3) for clarity; and replacing ``is responsible for the 
payment of taxes or maintenance of the residence'' with ``can produce 
verifiable documentation demonstrative of legal responsibility 
including tax payment receipts; receipts for major repairs, 
maintenance, or improvements of the residence; court documents, a 
letter from a public official, or, for mobile home or travel trailer 
owners residing in a commercial park, a letter from the mobile home 
park owner or manager'' in subparagraph (2) for clarity. FEMA has 
already implemented all of the proposed changes to the definition of 
the term ``Owner-occupied'' via the September 2, 2021, Amendment to 
FEMA Policy (FP) 104-009-03, Individual Assistance Program and Policy 
Guide (IAPPG), Version 1.1 memorandum; therefore, FEMA is only 
codifying existing practice in our revisions to this term.
    Permanent housing plan. FEMA revises the term ``Permanent housing 
plan'' to mean a realistic plan that, within a reasonable timeframe, 
puts the displaced applicant back into permanent housing that is 
similar to their pre-disaster housing situation. A reasonable timeframe 
includes sufficient time within the period of assistance for securing 
funds and services to repair the home, completing repairs or locating a 
permanent dwelling, and moving into the dwelling. This is consistent 
with the current definition of the term ``Permanent housing plan,'' 
except for FEMA replacing ``disaster victim'' with ``displaced 
applicant'' and replacing ``the victim's'' with ``their'' for 
consistency and adding the phrase ``within the period of assistance,'' 
the clause ``and services to repair the home,'' and the clause 
``completing repairs or'' for clarity.
    Reasonable commuting distance. FEMA revises the term ``Reasonable 
commuting distance'' to mean a distance that does not place undue 
hardship \316\ on an applicant. It also

[[Page 4030]]

takes into consideration the traveling time involved due to road 
conditions, e.g., mountainous regions or road closures and the normal 
commuting patterns of the area. This is consistent with the current 
definition of ``Reasonable commuting distance,'' except for FEMA 
replacing ``bridges out'' with ``road closures'' for grammar purposes; 
as, ``bridges out'' is not grammatically correct.
---------------------------------------------------------------------------

    \316\ The following are the types of circumstances that FEMA 
would consider as an ``undue hardship.'' FEMA takes into 
consideration the travel time involved due to road conditions and 
disaster-related impacts to commuting patterns in the area. For 
example, during the Oso mudslides, a main thoroughfare was destroyed 
due to the disaster and the only alternative for residents was to 
take a mountainous road that increased applicants commute time by 2 
hours. Similar situations have also occurred in Hawaii due to lava-
flow, where entire roadways were impassible and severely impacted 
the community.
---------------------------------------------------------------------------

    Recertification. FEMA defines the term ``Recertification'' to mean 
the process that FEMA uses to evaluate an applicant's eligibility for 
continued temporary housing assistance under Sec.  206.114. Currently, 
the recertification process is discussed in various places in the 
IAPPG.\317\ FEMA describes recertification as when FEMA re-evaluates 
the occupant's eligibility on a periodic basis, and the eligibility for 
the entire period of assistance is subject to the occupant continuing 
to meet recertification requirements. FEMA defines the term 
``Recertification'' in the IFR for clarity.
---------------------------------------------------------------------------

    \317\ See pages 98, 99, and 103 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Repairs. FEMA defines the term ``Repairs'' to mean repairs of a 
quality necessary for a safe and sanitary living or functioning 
condition. This is a new definition that FEMA aligns with the Stafford 
Act language at 42 U.S.C. 5174 and is consistent with the edits FEMA 
made in the below repair section.
    Safe. FEMA revises the term ``Safe'' to mean secure from hazards or 
threats to occupants. This is consistent with the current definition of 
the term ``safe,'' except for FEMA removing ``disaster-related'' from 
the definition.
    Sanitary. FEMA revises the term ``Sanitary'' to mean free of health 
hazards. This is consistent with the current definition of the term 
``sanitary,'' except for FEMA removing ``disaster-related'' from the 
definition.
    Under FEMA's current regulations, if an applicant's primary 
residence had existing health hazards prior to a disaster, the 
applicant would not be eligible for assistance to repair those hazards. 
The changes to the definitions of ``safe'' and of ``sanitary'' allow 
FEMA to provide assistance for repairing those hazards. For example, 
under the changes, if an applicant's primary residence had a leaky roof 
prior to a disaster, that leak will be eligible for repair as long as 
the primary residence incurred some disaster damage and repair or 
replacement of the roof was required to make the home sanitary. This is 
consistent with 42 U.S.C. 5174 and will help FEMA provide disaster 
assistance in a more fair and equitable manner.
    Serious need. FEMA revises the term ``Serious need'' to mean the 
requirement for an item, or service, that is necessary to an 
applicant's ability to prevent, mitigate, or overcome a disaster-
related hardship, injury or adverse condition. This is consistent with 
the current definition of the term ``Serious need,'' except for FEMA 
replacing ``essential'' with ``necessary'' for consistency with the 
Stafford Act at 42 U.S.C. 5174. The current regulation uses 
``essential,'' which is defined as ``absolutely necessary,'' so that is 
something more than necessary. With this change, FEMA is aligning with 
the statutory language more closely, especially where ``necessary'' can 
be interpreted as less of a bar for applicants to reach than 
``essential.''
    State. FEMA defines the term ``State'' to mean for the purposes of 
subpart D and where consistent with the requirements of the Stafford 
Act, any State as defined in Sec.  206.2(a)(22) \318\ or ``Indian 
tribal government'' as defined in the Stafford Act (42 U.S.C. 5122(6)). 
FEMA adds the defined term ``State'' which includes Tribes for clarity.
---------------------------------------------------------------------------

    \318\ State: Any State of the United States, the District of 
Columbia, Puerto Rico, the Virgin Islands, Guam, American Samoa, and 
the Commonwealth of the Northern Mariana Islands.
---------------------------------------------------------------------------

    Uninhabitable. FEMA revises the term ``Uninhabitable'' to mean the 
dwelling is not safe or sanitary. This is consistent with the current 
definition of ``Uninhabitable,'' except for FEMA adding ``or'' before 
``sanitary'' and removing ``or fit to occupy,'' since the Stafford Act 
at 42 U.S.C. 5174 does not define uninhabitable but only uses safe and 
sanitary as a habitability standard.

D. Section 206.112--Registration Period

    In the first sentence of Sec.  206.112(b), FEMA states that FEMA 
may extend the registration period when the State requests more time to 
collect registrations from the affected population. This is consistent 
with the first sentence of current Sec.  206.112(b), except for FEMA 
replacing ``the regional administrator or his/her designee'' with 
``FEMA'' to ensure continued consistency in processing across disasters 
at the national level.
    In the second sentence of Sec.  206.112(b), FEMA states that FEMA 
may also extend the standard registration period when necessary to 
establish the same registration deadline for contiguous counties or 
States. This is consistent with the second sentence of current Sec.  
206.112(b), except for FEMA replacing ``the Regional Administrator or 
his/her designee'' with ``FEMA'' to ensure continued consistency in 
processing across disasters at the national level.
    In Sec.  206.112(c), FEMA adds a new paragraph heading of 
``Reopening of the registration period'' for consistency with standards 
established by the Federal Register. FEMA adds a new paragraph 
206.112(c) which states that after the registration period for the 
major disaster or emergency has expired, FEMA may reopen the 
registration period for 60 days only when the President's declaration 
is amended to include additional counties and only for the additional 
counties. The intent is to limit a reopened registration period to 60 
days and just for the areas included in the add-on after the 
registration period already ended.
    In the second sentence of Sec.  206.112(d), FEMA states that we 
will process late registrations for those registrants who explain the 
reason for the delay in their registration. This is consistent with the 
second sentence of current Sec.  206.112(c), except for FEMA replacing 
``provide suitable documentation to support and justify'' with 
``explain'' as requiring documentation places a burden on applicants to 
produce the documents and can slow the provision of assistance to 
applicants. It is also generally accepted that underserved populations 
are most likely to struggle with producing suitable documentation.
    FEMA's current policy \319\ states that applicants who apply late 
must submit a letter that explains the extenuating circumstances that 
prevented them from applying for assistance in a timely manner and 
signed by the applicant or person who the applicant authorizes to act 
on their behalf. The letter should also include documentation 
justifying the extenuating circumstances. The documentation provided 
must be dated immediately prior to or within the FEMA registration 
period. Acceptable documentation may include:
---------------------------------------------------------------------------

    \319\ Page 71 of the Individual Assistance Program and Policy 
Guide, version 1.1 (Individual Assistance Program and Policy Guide 
(IAPPG) (fema.gov) discusses late applications and the types of 
acceptable information FEMA requires in order for the late 
application to be considered.
---------------------------------------------------------------------------

     Record of hospitalization, illness, or disability of the 
applicant or an immediate family member;
     Record of death for an immediate family member; or

[[Page 4031]]

     Proof of personal or business travel that kept the 
applicant out of the area for the full application period.
    Additionally, FEMA received the following comment in response to 
the RFI:

    The barriers for an applicant to access FEMA assistance should 
be as minimal as possible. To that end, [the commenter] requests 
that Congress accept any and all applications received during the 
thirty-day grace period after the deadline has passed. Currently, 
CFR requirements state that an applicant must provide ``suitable 
documentation'' to justify the late application. There are myriads 
of valid reasons why applicants may be late to apply and forcing 
them to justify why their particular reason should count is 
inappropriate and unnecessary.\320\
---------------------------------------------------------------------------

    \320\ FEMA-2021-0011-0149.

    In the past 10 years, FEMA has approved 51 percent of the late 
applications received. In many disasters, the disaster staff worked 
closely with survivors who submitted late applications to explain the 
necessary documentation and help gather it from the applicant. 
Simplifying the process for applicants will also allow this staff more 
time to support other elements of disaster recovery and applicants with 
other ineligibility reasons.
    The language surrounding ``suitable documentation'' has been in 
FEMA's regulations since the IHP regulations went into effect in 2002. 
Generally, requiring documentation has been a means for FEMA to 
validate that there is a disaster-related need. However, any applicants 
approved for further consideration based on their late application 
status still have to meet all the eligibility requirements required of 
applicants who applied during the application period (i.e., occupancy 
and ownership, citizenship, and identity verification, assistance 
eligibility criteria, etc.). Ultimately, survivors who apply during the 
late application period will only receive funds if they have disaster-
caused damages or losses.
    This change ultimately benefits applicants and lowers the 
documentation burden for receiving eligibility consideration for IHP 
assistance for any disaster survivor who registers during the late 
application period, while also providing FEMA the ability to ensure 
there is a disaster-related reason for the late application. There are 
no expected negative impacts for disaster survivors in making this 
change.
    FEMA has also decided to accept more reasons from applicants for 
late applications. These include:
     Incarceration;
     Victim of human trafficking;
     On-going domestic situations where persons in the same 
household posed an immediate threat to other family members, resulting 
in a separation of the family unit; or
     Major life events that occurred during the initial 
registration period (e.g., birth or adoption of a child, foster care 
placement, marriage, gender transition, transition of a family member 
into or out of a residential or mental health care facility) that led 
to a late application.
    FEMA considered the following policy alternatives: making no 
change; updating the language to no longer require suitable 
documentation; or removing the requirement for applicants to justify 
their late application at all. Making no change maintains a substantial 
applicant burden that slows the provision of assistance and likely 
impacts underserved populations disproportionately. While the current 
documentation requirement impacts a relatively small population's 
eligibility, it ultimately denies access to any form of FEMA IHP 
assistance if the applicant cannot provide documentation justifying the 
reason for their late application. Removing the requirement for any 
justification, verbal or otherwise, essentially removes any difference 
between the standard application period and the late application period 
which are identified as separate and distinct time periods.

E. Section 206.113--Eligibility Factors

    In the first sentence of Sec.  206.113(a), FEMA states that in 
general, FEMA may provide assistance to individuals and households who 
qualify for such assistance under the Stafford Act, 42 U.S.C. 5174, and 
subpart D. This is consistent with the first sentence of current Sec.  
206.113(a), except for FEMA removing ``section 408 of'' and adding ``42 
U.S.C. 5174'' after ``the Stafford Act,'' for clarity and public ease 
of reference.
    In Sec.  206.113(a)(1), FEMA states that FEMA may only provide 
assistance when the individual or household has incurred a disaster-
related necessary expense and serious need in the State in which the 
disaster has been declared, without regard to their residency in that 
State. This is consistent with current Sec.  206.113(a)(1), except for 
FEMA replacing ``or'' with ``and'' before ``serious need,'' as a 
codification of a current existing policy and practice since FEMA has 
always allowed applicants to receive assistance for both a necessary 
expense and a serious need without regard to their residency in that 
State and FEMA capitalizing ``State'' in Sec.  206.113(a)(1), when used 
as a noun.
    FEMA removes the current sentence at Sec.  206.113(a)(4), which 
states that an eligibility factor under which FEMA may provide 
assistance is in a situation where the applicant has insurance, when 
the insured individual or household's insurance proceeds are less than 
the maximum amount of assistance FEMA can authorize and the proceeds 
are insufficient to cover the necessary expenses or serious needs. FEMA 
removes current Sec.  206.113(a)(4), as an applicant may only receive 
assistance for real or personal property through the IHP when their 
insurance proceeds are less than the FEMA Verified Loss (FVL) and the 
applicable HA or ONA maximum. Per 42 U.S.C. 5174, FEMA can assist 
underinsured applicants, but the current regulations limit the 
assistance to applicants who receive less than $42,500 in real or 
personal property from their insurance company. FEMA identified the 
need to update FEMA's current regulations to allow for more equity in 
the IHP when FEMA determines the unmet needs of applicants by comparing 
their net insurance settlements to the FVL. For the reasons described 
earlier, the IFR limits the requirement to compare insurance proceeds 
to the financial HA or ONA maximum.
    In Sec.  206.113(a)(4), FEMA states that an eligibility factor 
under which FEMA may provide assistance is in a situation where the 
applicant has insurance, but the applicant cannot use their insurance 
because housing is not available on the private market. In Sec.  
206.113(a)(4), FEMA is consistent with current Sec.  206.113(a)(5), 
except for FEMA adding ``but the applicant cannot use their insurance'' 
after ``insurance,'' and replacing ``when'' with ``because'' for 
clarity. FEMA is incorporating this clarifying language to apply to 
applicants who have insurance but are unable to use their Additional 
Living Expenses or Loss of Use coverage, as there is no housing 
available on the private market.
    In Sec.  206.113(a)(5), FEMA states that an eligibility factor 
under which FEMA may provide assistance is in a situation where the 
applicant has insurance, when the insured individual or household has 
accepted all assistance from other sources for which he, she, or they 
are eligible, including insurance, and that assistance and insurance is 
insufficient to cover the necessary expense and serious need. In Sec.  
206.113(a)(5), FEMA is consistent with current Sec.  206.113(a)(6), 
except for FEMA replacing the phrase ``when the insured individual or 
household's insurance

[[Page 4032]]

proceeds and all other assistance are less than the maximum amount of 
assistance FEMA can authorize and the proceeds'' with the phrase ``and 
that assistance and insurance is'' before ``insufficient'' to allow for 
more equity and to more fully address the unmet needs of applicants, 
replacing ``or'' with ``and'' before ``serious'' for clarity, and 
replacing ``needs'' with ``need'' for grammar purposes. We note that 
the changes from ``or'' to ``and'' has no practical effect. Section 
408(a)(1) of the Stafford Act, 42 U.S.C. 5174, uses ``and'' for 
overarching eligibility criteria, but Section 408(e) of the Stafford 
Act, 42 U.S.C. 5174 uses ``or'' to describe eligibility criteria for 
ONA. FEMA used the word ``or'' in the current regulations to avoid 
being overly limiting; however, current Sec.  206.111 defines 
``necessary expense'' to be, essentially, whatever it costs to fix a 
``serious need.'' This means that although the regulations use ``or,'' 
FEMA always treated the phrase as an ``and.''
    Section 206.113(a)(6) is consistent with current Sec.  
206.113(a)(7), except for the changes to the paragraph structure. 
Section 206.113(a)(7) is consistent with current Sec.  206.113(a)(8), 
except for the changes to the paragraph structure and the removal of 
``and'' at the end of the paragraph. Section 206.113(a)(8) is 
consistent with current Sec.  206.113(a)(9), except for the changes to 
the paragraph structure and the addition of ``; and'' at the end of the 
paragraph to allow for a new paragraph Sec.  206.113(a)(9).
    In new Sec.  206.113(a)(9), FEMA states that FEMA may provide 
assistance with respect to home repair for accessibility-related items, 
if an applicant meets the following conditions: (i) the applicant is 
either an individual with a disability as defined in 42 U.S.C. 5122 
whose disability existed prior to the disaster and whose primary 
residence was damaged by the disaster, or an individual with a 
disability as defined in 42 U.S.C. 5122 whose disability was caused by 
the disaster and whose primary residence was damaged by the disaster; 
(ii) the real property component is necessary to meet the 
accessibility-related need of the household; and (iii) the real 
property component is not covered by insurance or any other source.
    In response to public comments, FEMA has also changed the 
regulatory text at Sec.  206.117(b)(2) and a new Sec.  206.113(a)(9) as 
a part of this IFR. The changes will allow FEMA flexibility to provide 
financial assistance to applicants for the installation or construction 
of real property items that were not present in the home prior to the 
disaster. Specifically, these changes allow IHP to expand its existing 
policy,\321\ which provides for the installation of ADA related real 
property to applicants with disaster-caused needs, to include Home 
Repair Assistance for disaster survivors with pre-existing, pre-
disaster needs for accessibility-related items, such as an exterior 
ramp, grab bars, etc., that make their home safe and functional when 
any level of disaster-caused real property damage occurs to the primary 
residence.
---------------------------------------------------------------------------

    \321\ September 2, 2021, Amendment to FEMA Policy (FP) 104-009-
03, Individual Assistance Program and Policy Guide (IAPPG), Version 
1.1 memorandum.
---------------------------------------------------------------------------

    Not only does the new regulatory text at Sec.  206.113(a)(9) list 
the home repair for accessibility-related items eligibility factors, 
but it also clarifies that FEMA uses the term an ``individual with a 
disability'' as defined in section 102(7) of the Stafford Act, 42 
U.S.C. 5122. Unfortunately, section 102(7) of the Stafford Act is 
outdated and states that the term ``individual with a disability'' 
means an individual with a disability as defined in Section 3(2) of the 
Americans with the Disabilities Act of 1990 (42 U.S.C. 12102(2)). The 
ADA was amended in 2008 and the definition of disability was moved from 
subparagraph (2) to subparagraph (1). Congress has not amended the 
Stafford Act to reflect this change; therefore, FEMA is interpreting 
the language in section 102(7) of the Stafford Act, 42 U.S.C. 5122, to 
mean that FEMA should use the ADA definition of disability with respect 
to an individual at 42 U.S.C. 12102(1).
    If FEMA did not interpret section 102(7) of the Stafford Act, 42 
U.S.C. 5122, to mean that the term ``individual with a disability'' 
means an individual with a disability as defined in the ADA at current 
42 U.S.C. 12102(1) and instead relied on the ADA cross-reference that 
is currently listed in the Stafford Act, 42 U.S.C. 12102(2), then FEMA 
will define ``individual with a disability'' based on the ADA 
definition of the term ``major life activities'' which is illogical. 
FEMA assumes that Congress will amend the Stafford Act to cross-
reference to the correct paragraph of the ADA.
    Via information collection 1660-0002, we are adding a documentation 
requirement to tie the need for the home repair accessibility-related 
items: ramp, grab bars, and/or paved pathway to the pre-existing 
disability to meet the household's access and functional need. We are 
requiring that a medical, health care, or rehabilitation professional 
certify whether or not this is necessary; as, they have the expertise 
to make that determination or we will accept prior medical, health 
care, or rehabilitation professional documentation that supports the 
need for the accessibility-related items.
    FEMA is making changes to Home Repair Assistance to adjudicate four 
RFI comments,\322\ so that FEMA may make the dwelling safe/sanitary for 
pre-disaster disabled applicants. For example, this change will allow 
FEMA to reimburse pre-disaster disabled applicants for accessibility 
items, such as grab bars and access ramps, if the primary residence 
sustained disaster damage regardless of whether or not the applicant 
had grab bars or access ramps pre-disaster.
---------------------------------------------------------------------------

    \322\ FEMA-2021-0011-0152, FEMA-2021-0011-0164, FEMA-2021-0011-
0235, and FEMA-2021-0011-0261.
---------------------------------------------------------------------------

    In Sec.  206.117(b)(2)(i), FEMA states that FEMA may provide 
financial assistance for the repair of an owner-occupied primary 
residence if: the eligibility criteria in Sec.  206.113 are met; FEMA 
determines the dwelling was damaged by the disaster; and the damage is 
not covered by insurance. This sentence is consistent with the current 
Sec.  206.117(b)(2)(i), except for FEMA removing the phrase ``real 
property components in'' before ``an owner-occupied primary 
residence;'' adding ``FEMA determines'' after ``met;'' removing ``to 
the component'' after ``damage'' and replacing ``component'' with 
``dwelling,'' as the Stafford Act does not limit repairs to 
``components'' and replacing ``owner's'' with ``owner-occupied'' for 
consistency as owner-occupied is the defined term in Sec.  206.111; 
removing the current Sec.  206.117(b)(2)(i)(B) that ``the component was 
functional immediately before the declared event'' and removing current 
Sec.  206.117(b)(2)(i)(E) that ``the repair of the component is 
necessary to ensure the safety or health of the occupant or to make the 
residence functional,'' and removing the clause ``and the damage was 
caused,'' since FEMA is paying for pre-existing conditions if the 
component itself was damaged by the disaster.
    In Sec.  206.117(b)(2)(ii), FEMA states that FEMA may provide 
financial assistance for the repair of the disaster damaged dwelling to 
a safe and sanitary living or functioning condition. This clause is 
consistent with the current Sec.  206.117(b)(2)(ii), except for FEMA 
adding ``the disaster damaged dwelling to a safe and sanitary living or 
functioning condition including'' after ``of.'' These additions align 
with the changes that make it clear that only

[[Page 4033]]

disaster damaged dwellings (regardless of their pre-disaster condition) 
may receive repair assistance, as FEMA may only pay to restore disaster 
damage to a safe and sanitary living or functioning condition. If the 
dwelling was not touched by the disaster, it will not be eligible for 
repair assistance; therefore, the applicant will not be able to apply 
for Home Repair Assistance for their pre-existing, pre-disaster needs 
for accessibility-related items, such as an exterior ramp, grab bars, 
etc., that make their home safe and functional.
    In Sec.  206.113(b)(1), FEMA states that FEMA may not provide 
assistance under subpart D for housing or displacement assistance, to 
individuals or households who are displaced from other than their pre-
disaster primary residence. This is consistent with the current Sec.  
206.113(b)(1), except for FEMA adding ``or displacement'' before 
``assistance'' for clarity, since we added displacement assistance to 
the ONA regulations in Sec.  206.119(b)(2).
    In Sec.  206.113(b)(2), FEMA states that FEMA may not provide 
assistance under subpart D for temporary housing or displacement 
assistance, to individuals or households who have adequate rent-free 
housing accommodations. This is consistent with the current Sec.  
206.113(b)(2), except for FEMA adding ``temporary'' before ``housing'' 
and adding ``or displacement'' before ``assistance'' for clarity. FEMA 
may provide assistance to repair an applicant's home, but FEMA will not 
provide the applicant with rental assistance or direct housing 
assistance, while the applicant's repairs are made because the 
applicant has somewhere else they can temporarily live.
    In Sec.  206.113(b)(3), FEMA states that FEMA may not provide 
assistance under subpart D for temporary housing or displacement 
assistance, to individuals or households who own a secondary or 
vacation residence within reasonable commuting distance to the disaster 
area, or who own available rental property that meets their temporary 
housing needs. This is consistent with the current Sec.  206.113(b)(3), 
except for FEMA adding ``temporary'' before ``housing'' and adding ``or 
displacement'' before ``assistance'' for clarity. See the explanation 
in the above discussion of Sec.  206.113(b)(2).
    In Sec.  206.113(b)(4), FEMA states that FEMA may not provide 
assistance under subpart D for temporary housing or displacement 
assistance to individuals or households who evacuated the residence in 
response to official warnings solely as a precautionary measure and are 
able to return to and safely occupy the residence immediately after the 
incident. This is consistent with the current Sec.  206.113(b)(4), 
except for FEMA adding ``temporary'' before ``housing'' adding ``or 
displacement'' before ``assistance,'' see the explanation in the above 
discussion of Sec.  206.113(b)(2), removing ``who'' before ``are,'' and 
adding ``and safely occupy'' before ``the residence immediately after 
the incident'' for clarity and equity. This is intended to apply to 
applicants that did not receive damage that impacted habitability and 
can safely return and live in their home immediately. However, lodging 
expense reimbursement is available to individuals or households who 
evacuated the residence in response to official warnings solely as a 
precautionary measure and did not receive temporary housing or 
displacement assistance. See Sec.  206.110(d).
    In Sec.  206.113(b)(5), FEMA states that FEMA may not provide 
assistance under subpart D for housing assistance, for improvements or 
additions to the pre-disaster condition of property, except for the 
following: (i) improvements or additions required to make repairs that 
comply with local and State ordinances; (ii) eligible hazard mitigation 
measures; or (iii) accessibility-related items for individuals with 
disabilities, consistent with Sec.  206.113(a)(9). This is consistent 
with the current Sec.  206.113(b)(5), except for FEMA adding ``for the 
following:'' after ``except'' and giving the exceptions in a list 
format across paragraphs (b)(5)(i)-(iii), for clarity; replacing 
``those'' with ``improvements or additions'' for clarity; adding 
``hazard'' to ``Eligible hazard mitigation measures'' for clarity since 
that is the defined term in Sec.  206.111; adding to ``make repairs 
that'' before ``comply'' for clarity; and adding an exception for 
accessibility-related items for individuals with disabilities, for 
consistency with the changes to Sec.  206.113(a)(9).
    In Sec.  206.113(b)(9), FEMA states that FEMA may not provide 
assistance under subpart D for business losses, including farm 
businesses. This is consistent with the current Sec.  206.113(b)(9), 
except for FEMA removing ``and self-employment'' in order to allow the 
self-employed eligibility for essential tools. Currently, the self-
employed are ineligible for IHP grants; so, artists and gig workers 
cannot apply for ONA personal property assistance for their self-
employed personal property assistance items damaged in the disaster. 
Businesses will continue to be ineligible for business losses under 
206.113(b)(9). Therefore, FEMA is allowing a self-employed individual 
to receive assistance under the ONA portion of the IHP for personal 
property losses under 206.119(b)(6)(iv) in their individual capacity. 
For example, under our changes, a gig worker could apply for personal 
property assistance for disaster damaged essential tools that are 
required for their livelihood. So, if they are a guitar player, then 
they could apply for ONA personal property assistance for repairing/
replacing the guitar, whichever is needed.
    For self-employed individuals, FEMA relies on the individual to 
self-certify the items required for their job.\323\ Two RFI commenters 
\324\ address challenges faced by self-employed individuals that 
participate in the ``gig economy.'' These individuals that have no 
employees other than themselves are classified by the U.S. Census 
Bureau as ``nonemployer businesses'' may face challenges identifying 
the types of assistance for which they qualify at FEMA and other 
Federal Agencies.
---------------------------------------------------------------------------

    \323\ For self-employed applicants FEMA requires, a written 
statement from the applicant, including an itemized list of 
essential tools, specialized or protective clothing, computing 
devices, and equipment required for self-employment, verifying their 
need for the items. The statement must include, ``I hereby declare 
under penalty of perjury that the foregoing is true and correct,'' 
and be signed by the applicant. Tax return documentation would be 
required to establish self-employment (e.g., Form 1040 or 1040-SR, 
Schedule C, etc.).
    \324\ FEMA-2021-0011-0187 and FEMA-2021-0011-0200.
---------------------------------------------------------------------------

    In Senate Report 115-283, which accompanied the Fiscal Year (FY) 
2019 DHS Appropriations Act (Pub. L. 116-6) included the requirement 
that FEMA review its reimbursement policy, including in relation to 
Small Business Loans, for expenses incurred as a result of a major 
disaster or emergency by self-employed or freelance workers for tool 
repair or replacement, specialized or protective clothing, or other 
requirement equipment, for fairness in relation to other reimbursement 
policies. The Senate Report also requested a cost estimate.
    FEMA's Individuals and Households Program Assistance for 
Occupational Tools FY 2019 Report to Congress (FY 2019 Report) found 
that FEMA IHP assistance is not a substitute for insurance and cannot 
compensate for all losses caused by a disaster. The IHP is intended to 
meet basic needs and supplement disaster recovery efforts. FEMA 
believed that it was appropriate to continue to direct businesses, 
including self-employed persons, to SBA so that they can secure low-
interest loans for their disaster-related losses. Self-employment 
business losses are ineligible for FEMA assistance, meaning that FEMA 
does not record business-

[[Page 4034]]

related losses including occupational tool loss, from IHP applicants 
who self-report that their household's primary source of income is 
self-employment. Because of this ineligibility, FEMA could not provide 
a cost estimate about self-employment business losses from IHP 
applicants in the FY 2019 Report.
    Currently, self-employed individuals are eligible for all FEMA 
assistance for their personal losses, except for necessary expenses and 
serious needs related to business losses. Non-self-employed individuals 
may receive assistance for disaster related costs for occupational 
tools, such as tool repair or replacement, essential computer, and 
uniforms, which may include specialized or protective clothing, but 
these are currently considered business losses for the self-employed, 
which makes them ineligible. The IFR changes this by removing ``self-
employment'' from the list of conditions of ineligibility.
    This IFR removes the requirement that applicants apply and receive 
an SBA loan denial before FEMA considers them for personal property 
assistance. FEMA assists self-employed individuals, solely related to 
their personal essential tools, without ever requiring them to seek 
loan assistance from SBA for these losses. In order to implement this 
change, FEMA is removing ``self-employment'' as a condition of 
ineligibility for business losses.
    FEMA is making this policy change as there is stakeholder interest 
in such. Not only did FEMA receive two RFI comments on this matter, but 
obviously there is Congressional interest, since Senate Report 115-283 
asked FEMA to review its policy.
    In Sec.  206.113(b)(10), FEMA states that FEMA may not provide 
assistance under subpart D for any items not otherwise authorized by 
Sec. Sec.  206.117 and 206.119. This is consistent with current Sec.  
206.113(b)(10), except for FEMA replacing ``this section'' with 
``Sec. Sec.  206.117 and 206.119,'' for clarity since Sec.  206.113 
does not actually authorize any items.

F. Section 206.114--Criteria for Continued or Additional Assistance

    FEMA revises Sec.  206.114's heading of ``Criteria for continued 
assistance'' to ``Criteria for continued or additional assistance'' for 
clarity since it does not only cover ``Criteria for continued 
assistance.''
    In Sec.  206.114(a), FEMA adds a new paragraph heading of 
``General'' for consistency since the rest of the paragraphs at this 
level have paragraph headings and to comply with the Federal Register 
Document Drafting Handbook.
    In the second sentence of Sec.  206.114(a), FEMA states that FEMA 
may provide initial and continued temporary housing assistance, 
financial or direct, upon request during the period of assistance, 
based on need, and generally only when adequate, alternate housing is 
not available or when the permanent housing plan has not been fulfilled 
through no fault of the applicant. This sentence is consistent with the 
current second sentence of Sec.  206.114(a), except for FEMA providing 
clarifying language by adding ``initial and'' before ``continued'' for 
clarity; adding ``temporary'' between ``continued housing'' for 
consistency throughout the section; adding ``financial or direct, upon 
request'' before ``during,'' to clarify that ``continued temporary 
housing assistance'' covers both financial or direct assistance and to 
clarify that applicants must request CTHA; and removing the clause 
``but not to exceed the maximum amount of assistance for the program.'' 
FEMA deletes the clause, as section 1212 of the DRRA authorized changes 
to the provision of IHP Assistance by removing the financial assistance 
maximum award limits for temporary housing assistance. These changes 
were retroactive to disasters declared on or after August 1, 2017.
    ``Upon request'' refers to the required income and housing costs 
documentation applicants in need of continued temporary housing 
assistance will have to complete to request additional assistance. 
Applicants may complete the IHP Application for Continued Temporary 
Housing Assistance, FEMA Form FF-104-FY-21-115, and the Supplemental 
Application for Continued Temporary Housing Assistance, FEMA Form FF-
XXXXX, to request additional assistance. FEMA uses the information 
collected on the Application for Continued Temporary Housing Assistance 
to verify that an applicant continues to have a disaster-caused need 
for CTHA and to determine how much rental assistance the applicant may 
be eligible to receive.
    For an applicant that is a homeowner and if the applicant's FEMA 
verified real property loss exceeds the amount of initial rental 
assistance awarded, FEMA will automatically mail the Application for 
Continued Temporary Housing Assistance after the initial rental 
assistance award. If the recorded FEMA-verified real property loss does 
not exceed the amount of initial rental assistance awarded, the 
applicant must call FEMA's Helpline to request an Application for 
Continued Temporary Housing Assistance. For an applicant that is a 
renter, the applicant must call FEMA's helpline to request an 
Application for Continued Temporary Housing Assistance. In Sec.  
206.114(b), FEMA replaces the paragraph heading of ``Additional 
criteria for continued assistance'' with ``Rental assistance'' for 
clarity.
    In Sec.  206.114(b), FEMA adds a new paragraph that states that 
FEMA may provide initial financial assistance for rent, also known as 
initial rental assistance, as described in Sec.  206.117(b)(1)(i), to 
displaced eligible applicants to rent alternate housing accommodations 
for an initial time period established by FEMA.
    FEMA reorganizes our current regulations at Sec.  206.114(b)(1) 
through (5), as FEMA found that having the eligibility, non-
eligibility, and criteria for continued assistance categories separate 
from the specific types of assistance made for very difficult reading. 
Therefore, FEMA instead of conflating the regulations into one 
paragraph, separates them into two paragraphs: ``Rental assistance'' 
and ``Direct housing assistance.'' There are no substantive changes in 
the reorganization, as we simply introduce initial and continued 
assistance for both rental and direct assistance in a clearer way.
    In Sec.  206.114(b)(1), we state that FEMA may periodically 
recertify all displaced applicants who received initial rental 
assistance and request continued rental assistance. All displaced 
applicants requesting continued rental assistance must take the 
following actions at certain points throughout the recertification 
process: submit rent receipts to show that they have exhausted or will 
exhaust previously provided funds; provide documentation demonstrating 
they lack the financial ability to pay their post-disaster housing 
costs and have a continued need for rental assistance; establish a 
realistic permanent housing plan; and provide documentation showing 
that they are making efforts to obtain permanent housing.
    In the first new sentence of Sec.  206.114(b)(1), FEMA clarifies 
that in order for displaced applicants to receive CTHA they must have 
been awarded initial rental assistance.
    In the second sentence of Sec.  206.114(b)(1), FEMA states that all 
displaced applicants requesting continued rental assistance must take 
the following actions at certain points throughout the recertification 
process. This sentence is not consistent with the current second 
sentence of

[[Page 4035]]

Sec.  206.114(b)(1) as FEMA currently requires that all applicants must 
establish a realistic permanent housing plan no later than the first 
certification for continued assistance. In this IFR, FEMA splits the 
recertification process into several timeframes and allow applicants to 
build upon their preliminary documentation as the disaster recovery 
continues. For example, within the first two payments of CTHA, FEMA 
will only require applicants to identify a plan for permanent housing. 
After the second two payments of CTHA, FEMA will require applicants to 
present documentation showing progress toward achieving their permanent 
housing plan and to identify any obstacles impeding the achievement of 
the plan. FEMA will use these submissions to conduct additional 
outreach to applicants who are encountering obstacles or to refer such 
applicants to voluntary organizations to assist them.
    In order to help FEMA provide appropriate resources and assistance 
to applicants throughout their housing recovery process, applicants 
will select from a list of permanent housing plans on the Application 
for Continued Housing Assistance form based on their pre-disaster 
housing status.
    The type of documentation that will be required to establish a 
permanent housing plan will be variable and flexible depending on an 
applicant's specific circumstances. For example, the following table 
provides a non-exhaustive list of the varying types of documentation 
that might be required based on the applicant's plan to achieve a 
permanent housing solution and pre-disaster status.
BILLING CODE 9111-24-P
[GRAPHIC] [TIFF OMITTED] TR22JA24.003

    As post-disaster recovery can be a challenge for all applicants, 
FEMA will engage more closely to assist applicants in achieving a 
recovery outcome by the end of the period of assistance. FEMA will work 
with applicants through all

[[Page 4036]]

recertification phases to review their progress toward their PHP and 
identify specific resources to assist the applicant in achieving their 
recovery goals.
---------------------------------------------------------------------------

    \325\ Depending on the size and scope of the disaster(s), FEMA 
may adjust the timeframes in the table, as needed. FEMA will 
continue to engage applicants throughout the recertification 
process, especially those who continue to receive assistance toward 
the end of disaster in order to ensure they are able to better 
transition into a non-FEMA provided housing solution.
[GRAPHIC] [TIFF OMITTED] TR22JA24.004

BILLING CODE 9111-24-C
    In Sec.  206.114(b)(1)(i), FEMA states that displaced applicants 
requesting continued rental assistance must submit rent receipts to 
show exhaustion of previously provided funds. This sentence is 
generally consistent with the current first sentence of Sec.  
206.114(b)(2), except for FEMA adding ``displaced'' before 
``applicants'' for consistency; and replacing ``they have exhausted the 
FEMA rent funds and'' with less limiting language ``that they have 
exhausted or will exhaust previously provided funds.'' While this is 
less limiting, it is still the Program's intent that the applicant must 
exhaust their funds. However, funds may be awarded prior to exhaustion 
to prevent a gap in assistance.
    In Sec.  206.114(b)(1)(ii), FEMA states that displaced applicants 
requesting continued rental assistance must provide documentation 
demonstrating they lack the financial ability to pay their post-
disaster housing costs and have a continued need for rental

[[Page 4037]]

assistance. The only part of Sec.  206.114(b)(1) that currently exists 
is the clause to ``provide documentation,'' in current Sec.  
206.114(b)(2). The language, ``provide documentation,'' refers to the 
submission of the current recertification form, FEMA Form 104-FY-21-
115, IHP Application for Continued Temporary Housing Assistance, as 
described in Chapter 3: IV.C.2. of IAPPG 1.1.\326\ Thereby, the way the 
displaced applicant provides documentation that they lack the financial 
ability to pay their post-disaster housing costs and have a continued 
need for assistance is by completing the CTHA application and providing 
any additional documentation, as needed.
---------------------------------------------------------------------------

    \326\ See page 82 of IAPPG 1.1 Individual Assistance Program and 
Policy Guide [bond] FEMA.gov.
---------------------------------------------------------------------------

    In Sec.  206.114(b)(1)(iii), FEMA states that displaced applicants 
requesting continued rental assistance must establish a realistic 
permanent housing plan, which is consistent with current Sec.  
206.114(b)(1) except for the timing of the realistic permanent housing 
plan. Currently, the realistic permanent housing plan is required no 
later than the first certification for continued assistance. In this 
IFR, FEMA no longer requires the realistic housing plan at the first 
certification for continued assistance.
    In Sec.  206.114(b)(1)(iv), FEMA states that displaced applicants 
requesting continued rental assistance must provide documentation 
showing that they are making efforts to obtain permanent housing, which 
is consistent with current Sec.  206.114(b)(1).
    In the first sentence of Sec.  206.114(b)(2), FEMA states that FEMA 
expects that pre-disaster renters will use their initial rental 
assistance to obtain permanent housing. This is consistent with the 
current first sentence of Sec.  206.114(b)(3), except for FEMA removing 
``generally'' before ``expects'' for clarity. FEMA does not want to 
suggest that in some cases applicants should not seek to obtain 
permanent housing.
    In the second sentence of Sec.  206.114(b)(2), we state that FEMA 
may provide continued rental assistance to pre-disaster renters with a 
continuing disaster-related housing need. This is consistent with the 
current second sentence of 206.114(b)(3), except for FEMA replacing 
``we'' with ``FEMA'' for clarity; replacing ``may certify them during 
the period of assistance, for'' with ``may provide'' before 
``continued'' for clarity; replacing ``rent'' with ``rental'' before 
assistance; and replacing ``when adequate, alternate housing is not 
available, or when they have not realized a permanent housing plan 
through no fault of their own'' with ``to pre-disaster renters with a 
continuing disaster-related housing need'' for clarity. FEMA's language 
is closer to the Stafford Act language at 42 U.S.C. 5174 which is our 
authorizing statute.
    Currently, Sec.  206.114 discusses rental assistance and direct 
housing assistance in the same paragraph. But, in this IFR we separate 
rental assistance from direct housing assistance. There will be 
repetitive language in 206.114(b) and (c), in order to clarify to the 
public what the requirements are for rental assistance and direct 
housing assistance.
    In Sec.  206.114(c), FEMA adds a new paragraph heading ``Direct 
housing assistance,'' for consistency since the rest of the paragraphs 
at this level have paragraph headings and to comply with the Federal 
Register Document Drafting Handbook.
    In Sec.  206.114(c), FEMA states that FEMA may provide direct 
housing assistance as described in Sec.  206.117(b)(1)(ii), to 
displaced eligible applicants who are unable to make use of financial 
assistance to rent adequate alternate housing. FEMA may periodically 
recertify all displaced applicants receiving direct housing assistance 
for continued direct housing assistance. All displaced applicants who 
need continued direct housing assistance must take the following 
actions at certain points throughout the recertification process: (1) 
establish a realistic permanent housing plan; and (2) provide 
documentation showing that they are making efforts to obtain permanent 
housing throughout the recertification process. The clause in Sec.  
206.114(c)(1) is generally consistent with the current first sentence 
of Sec.  206.114(b)(1), except for FEMA removing the phrase ``no later 
than the first certification for continued assistance.'' The clause in 
Sec.  206.114(c)(2) is generally consistent with the current second 
sentence of Sec.  206.114(b)(1), except for FEMA adding ``throughout 
the recertification process'' after ``permanent housing.''
    In Sec.  206.114(d), FEMA adds a new paragraph heading ``Other 
assistance,'' for consistency since the rest of the paragraphs at this 
level have paragraph headings and to comply with the Federal Register 
Document Drafting Handbook.
    In Sec.  206.114(d) through (1), FEMA adds a new paragraph to state 
that FEMA may provide repairs or housing replacement assistance, as 
described in Sec.  206.117(b)(2) and Sec.  206.117(b)(3), lodging 
expense reimbursement, as described in Sec.  206.117(b)(1)(i), or other 
needs assistance, as described in Sec.  206.119, to eligible 
applicants. If FEMA requires more information to process an applicant's 
initial request for assistance, it may request additional information. 
This new language is intentionally broad in case FEMA finds an 
alternate way to contact applicants to request additional information 
in the future (e.g., via text) and it codifies Chapter 3: C.2. of IAPPG 
1.1, which is a narrower, as it states that an applicant may receive a 
letter requesting additional information.\327\
---------------------------------------------------------------------------

    \327\ See page 76 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    In Sec.  206.114(d)(2), FEMA states that after the initial award of 
assistance, applicants requesting additional assistance for repairs, 
housing replacement, lodging expense reimbursement, personal property, 
transportation, child care, medical, dental, funeral, moving and 
storage, or other necessary expenses and serious needs may submit an 
appeal as outlined in Sec.  206.115 and will be required to submit 
information and/or verifiable documentation established via guidance 
identifying the additional need. In Sec.  206.114(d)(2), FEMA combines 
current Sec.  206.114(b)(5) and Sec.  206.114(b)(6) into one sentence, 
so as not to have to repeat the following language twice as it is used 
in both current Sec.  206.114(b)(5) and current Sec.  206.114(b)(6): 
``individuals or households requesting additional'' and ``will be 
required to submit information and/or documentation identifying the 
continuing need.'' Section 206.114(d)(2) is consistent with combining 
current Sec.  206.114(b)(5) and Sec.  206.114(b)(6), except for FEMA 
adding ``After the initial award of assistance'' to the beginning of 
Sec.  206.114(d)(2) for clarity; replacing ``Individual or households'' 
with ``Applicants for consistency;'' adding ``repairs, housing 
replacement, lodging expense reimbursement'' before ``personal'' for 
clarity and consistency; adding ``child care'' before ``medical;'' 
adding ``may submit an appeal as outlined in Sec.  206.115 and'' before 
``will be'' for clarity; adding ``verifiable'' before 
``documentation;'' adding ``established via guidance'' before 
``identifying;'' and replacing ``continuing'' with ``additional'' at 
the end of the sentence for clarity purposes. ``Continuing need'' is 
not appropriate in the sentence as there is not a ``continuing need'' 
for repair assistance, rather an ``additional'' need of repair 
assistance is more appropriate. FEMA adds child care; as section 1108 
of the Sandy Recovery Improvement Act of

[[Page 4038]]

2013 (SRIA) \328\ established child care as an eligible expense under 
the ONA provision of the IHP.\329\ This is a clarifying edit; as, 
currently FEMA implements child care assistance through Chapter 3: 
VI.B.3. of IAPPG 1.1.\330\ FEMA adds ``verifiable'' documentation at 
Sec.  206.114(d)(2), as per PKEMRA FEMA has a responsibility for 
identifying fraud, waste, and abuse. Therefore, FEMA is making this 
provision, for clarity and transparency to allow the public to know 
that the documentation they submit to support their requests for CTHA 
must be verifiable. FEMA will call service providers as applicable to 
validate the veracity of the supporting documentation that applicants 
submit to FEMA.
---------------------------------------------------------------------------

    \328\ Sandy Recovery Improvement Act of 2013, Pub. L. 113-2, 127 
Stat. 47 (Jan. 29, 2013), 42 U.S.C. 5174(e)(1).
    \329\ Initially, the Recovery Policy, Disaster Assistance for 
Child Care 9461.1, Jan. 17, 2014 was the controlling policy, https://www.fema.gov/sites/default/files/2020-07/recovery-policy_disaster%20assistance-child-care.pdf.
    \330\ See pages 155-160 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    FEMA adds ``may submit an appeal as outlined in Sec.  206.115'' for 
clarity; however, this is the current process so it will not change 
anything for applicants. Page 66, Chapter 3: II.C. 2. of the IAPPG 1.1 
says that applicants may submit a written appeal if they disagree with 
any FEMA determination. This is in line with what FEMA states in 
206.114(d)(2). Page 68, Chapter 3: II.C.5. of the IAPPG 1.1, states 
that the appeal letter should be accompanied by documentation to 
support the appeal request, such as repair estimates, contractor 
estimates, or other supporting documentation. Table 6 lists supporting 
documentation that must be submitted to FEMA to demonstrate current 
housing costs and the use of the previously awarded rental assistance 
or CTHA funds.
BILLING CODE 9111-24-P

[[Page 4039]]

[GRAPHIC] [TIFF OMITTED] TR22JA24.005

BILLING CODE 9111-24-C
    Upon subsequent requests for CTHA, applicants will only need to 
submit supporting documentation for income and housing costs if the 
household's income or housing costs have changed. See 44 CFR 
206.114(b).

G. Section 206.115--Appeals

    In the first sentence of Sec.  206.115(a), FEMA states that under 
the provisions of the Stafford Act, 42 U.S.C. 5189a, applicants for 
assistance under subpart D may appeal any determination of eligibility 
for assistance made under subpart D. This sentence is consistent with 
the current first sentence of Sec.  206.115(a), except for FEMA 
removing ``section 423 of'' and inserting ``42 U.S.C. 5189a,'' before 
applicants. FEMA makes these edits for public ease of reference, as a 
United States Code cite is more accessible to the public and 
referencing the section of the Stafford Act just increases the length 
of the regulation.
    In the first sentence of Sec.  206.115(b), FEMA states that appeals 
must include a written explanation or verifiable documentation for the 
appeal and meet the requirements of Sec.  206.117, as applicable. This 
sentence is consistent with the current first two words of the first 
sentence of Sec.  206.115(b). In the first sentence of Sec.  
206.115(b), FEMA replaces the clause ``be in writing and explain the 
reason(s) for the appeal'' with ``include a written explanation or 
verifiable documentation for the appeal'' to reduce the complexity, to 
streamline the process, to reduce FEMA processing time, and to decrease 
the burden on applicants to successfully appeal a determination. This 
language allows applicants to continue to submit a written letter of 
explanation to enhance their appeal, if they choose, and establishes 
the requirement to submit either a written appeal or verifiable 
documentation--thus reducing the need for additional letters requesting 
this information from

[[Page 4040]]

applicants. Finally, FEMA adds a cross reference for consistency to the 
end of the first sentence of Sec.  206.115(b) ``and meet the 
requirements of Sec.  206.117, as applicable'' since FEMA's current 
regulations at Sec. Sec.  206.117(b)(2)(vii), 206.117(b)(3)(iv), and 
206.117(b)(4)(iii) include cross references to the appeals procedures 
in Sec.  206.115.
    In the second sentence of Sec.  206.115(b), FEMA states ``See 
Sec. Sec.  206.117(b)(2)(vi), 206.117(b)(3)(iv), and 
206.117(b)(4)(iii).'' FEMA makes this addition to the current 
regulations for clarity; as, the cross references to the appeals 
procedures in Sec.  206.115 already exist in FEMA's current regulations 
at Sec. Sec.  206.117(b)(2)(vii), 206.117(b)(3)(iv), and 
206.117(b)(4)(iii).
    In the third sentence of Sec.  206.115(b), FEMA states that if 
someone other than the applicant files the appeal, then the applicant 
must also submit a signed statement giving that person authority to 
represent them. This sentence is consistent with the current third 
sentence in Sec.  206.115(b), except for FEMA removing ``his, her, or'' 
before ``them'' as ``his or her'' is redundant.
    In the fourth sentence of Sec.  206.115(b), FEMA states that if a 
written explanation is submitted, it must be signed by the applicant or 
a person the applicant designates to represent them. This sentence is 
consistent with the intent of the current second sentence in Sec.  
206.115(b). This sentence is trying to ensure that the public 
understands that if a written explanation is submitted, it has to be 
signed either by the applicant or the person the applicant chooses to 
represent them. If the applicant submits verifiable documentation no 
signature is necessary.
    In Sec.  206.115(c), FEMA states that applicants must appeal to 
FEMA for decisions made under subpart D, unless FEMA has made a grant 
to the State to provide assistance to individuals and households under 
Sec.  206.120(a), State administration of other needs assistance; then 
the applicant must appeal to the State. This is consistent with the 
current Sec.  206.115(c), except for FEMA replacing ``the Regional 
Administrator or his/her designee'' with ``FEMA'' to ensure continued 
consistency in processing across disasters at the national level. This 
change also aligns regulations with current practices that already 
streamline the appeals process to eliminate delays.
    In the second sentence of Sec.  206.115(d), FEMA states that if 
someone other than the applicant is submitting the request, then the 
applicant must also submit a signed statement giving that person 
authority to represent them. This is consistent with the current second 
sentence of Sec.  206.115(d), except for FEMA placing ``him or her'' 
with ``them'' for consistency with the edits suggested in the third 
sentence of Sec.  206.115(b).
    FEMA removes current Sec.  206.115(e), which states that the 
appropriate FEMA or State program official will notify the applicant in 
writing of the receipt of the appeal. FEMA removes current Sec.  
206.115(e), to codify the current practice that the applicant is not 
notified in writing of receipt of the appeal.
    In the first sentence of Sec.  206.115(e), FEMA states that FEMA or 
the appropriate State official will review the original decision after 
receiving the appeal. This sentence is consistent with the current 
first sentence Sec.  206.115(f), except for FEMA replacing ``the 
Regional Administrator or his/her designee'' with ``FEMA'' to ensure 
continued consistency in processing across disasters at the national 
level and adding ``the'' before ``appropriate'' for grammar purposes.
    In the second sentence of Sec.  206.115(e), FEMA states that FEMA 
or the State, as appropriate, will give the appellant a written notice 
of the disposition of the appeal and a reason for the determination 
within 90 days of receiving the appeal. This sentence is consistent 
with the current second sentence of Sec.  206.115(f), except for FEMA 
removing ``the'' before ``receiving'' for grammar purposes and adding 
``and a reason for the determination'' for clarity and transparency; 
as, it is currently FEMA's practice to provide a reason in the written 
notice of the disposition of the appeal.
    In the third sentence of Sec.  206.115(e), FEMA states that the 
decision of the FEMA or State appellate authority is final. This 
sentence is consistent with the current third sentence of Sec.  
206.115(f), except for FEMA adding a clarifying phrase ``FEMA or 
State'' before ``appellate.''

H. Section 206.117--Housing Assistance

    In Sec.  206.117(a), FEMA removes the definition ``Caused by the 
disaster'' since FEMA is paying for pre-existing conditions if the 
component itself was damaged by the disaster, adding the term 
``Multifamily Rental Housing,'' and revising the definition of ``Real 
Property Component'' or ``Component,'' as follows.
    Multifamily Rental Housing. FEMA defines the term ``Multifamily 
Rental Housing'' to mean a rental property that contains three or more 
dwelling units contained within one building, each such unit providing 
complete and independent living facilities for one or more persons, 
including permanent provisions for living, sleeping, cooking, and 
sanitation. FEMA has used this definition since the January 1, 2019, 
release of the Individual Assistance Program and Policy Guide at 
Chapter 3: V.D.1.\331\ Section 1103 of SRIA \332\ established FEMA's 
authority to lease and repair rental units located in areas covered by 
a major disaster declaration for temporary housing of applicants, and 
section 1213 of DRRA \333\ reaffirmed this authority. Currently, FEMA 
has no regulations specific to the selection of properties to be leased 
and repaired, the types of repairs that may be funded, or the intention 
that these rental units are to be used as a type of Direct Temporary 
Housing Assistance. Therefore, this IFR will detail the requirements of 
implementing Multifamily Lease and Repair as a form of Direct Temporary 
Housing Assistance including addition of the definition of 
``Multifamily Rental Housing.''
---------------------------------------------------------------------------

    \331\ See page 105 of IAPPG. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \332\ 42 U.S.C. 5174(c)(1)(B).
    \333\ Disaster Recover Reform Act of 2018, Public Law 115-254, 
132 Stat. 3448 (Oct. 5, 2018), 42 U.S.C. 5174(c)(1)(B).
---------------------------------------------------------------------------

    However, FEMA currently has a definition of ``Multifamily Rental 
Housing'' in the IAPPG 1.1 at Chapter 3: V.E.1.\334\ that is consistent 
with the definition of ``Multifamily Rental Housing'' here except for 
the clarifying phrase ``contained within one building.'' This phrase 
was added to clarify that the definition of multifamily rental housing 
is limited to rental properties contained within one building, such as 
apartments, and does not include rental properties composed of multiple 
separate dwelling units on the same plot of land.
---------------------------------------------------------------------------

    \334\ See page 107 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Prior to the definition of ``Multifamily Rental Housing'' in the 
2019 version of the IAPPG, FEMA followed the HUD regulations at 12 CFR 
1282.1(b), which states multifamily housing means a residence 
consisting of more than four dwelling units. However, during DR-4277-
LA, the available housing market of multifamily buildings proved 
insufficient to meet the demand for temporary housing in the affected 
area. FEMA received hundreds of calls and emails from property owners 
interested in MLR. Despite a growing need for temporary housing and 
interest in MLR, many properties were immediately excluded based solely 
on the fact that the buildings had four or fewer units. Based on this 
experience, FEMA

[[Page 4041]]

decided to expand the criteria to include three or more dwelling units 
because the risk of diminishing returns on the time and labor required 
to assess and scope potential properties was more than offset by making 
MLR viable in communities where three- and four-unit buildings were 
prevalent and larger multifamily properties were scarce.
    When provided the authority to repair or make improvements to 
existing multifamily housing units as a form of direct temporary 
housing assistance via SRIA, FEMA initially defined ``multifamily 
housing'' as ``a property that consists of not less than five dwelling 
units in one site, each such unit providing complete living facilities 
including provisions for cooking, eating, and sanitation within the 
unit.'' \335\
---------------------------------------------------------------------------

    \335\ See page 73 of the Individuals and Households Program 
Unified Guidance, released on September 30, 2016, at FEMA 
Individuals and Households Program Unified Guidance.
---------------------------------------------------------------------------

    FEMA specifically seeks public comment on whether its definition is 
appropriate, or should be changed from ``three or more dwelling units 
contained within one building'' to ``two or more dwelling units 
contained within one building.''
    Real Property Component or Component. FEMA revises the term ``Real 
Property Component'' or ``Component'' to mean each individual part of a 
dwelling as enumerated in paragraph (b)(2)(ii) of Sec.  206.117. This 
is consistent with the definition of ``Real Property Component'' or 
``Component'' in current Sec.  206.117(a) except for FEMA removing the 
phrase ``that makes it habitable,'' as whether or not the component 
makes the dwelling habitable is now immaterial in the definition. The 
overarching eligibility requirement for housing assistance is whether 
or not the applicant's home is uninhabitable. Once an applicant has hit 
that threshold, FEMA is simplifying the program to pay for all 
components listed in paragraph (b)(2)(ii) of Sec.  206.117 as long as 
the component incurred some disaster damage and then repair those 
components ``to'' a safe and sanitary living or functioning condition.
    FEMA revises subparagraph heading (i) of Sec.  206.117(b)(1) from 
``Financial'' to ``Rental'' assistance for clarity. In the first 
sentence of Sec.  206.117(b)(1)(i), FEMA states that eligible displaced 
applicants may receive rental assistance to rent alternate housing 
resources. This sentence is consistent with the current first sentence 
of Sec.  206.117(b)(1)(i), except for FEMA replacing ``individuals and 
households'' with ``displaced applicants'' for clarity; replacing 
``financial'' with ``rental'' for clarity; and removing ``existing 
rental units, manufactured housing, recreational vehicles, or other 
readily fabricated dwellings'' for clarity. There is no reason to list 
the definition of ``Alternate housing resources'' in the sentence after 
using the defined term. Finally, in the third sentence of Sec.  
206.117(b)(1)(i), FEMA states that this may include lodging expense 
reimbursement for reasonable short-term lodging expenses for 
individuals or households who have not received displacement assistance 
(See Sec.  206.119(b)(2)) in the immediate aftermath of a disaster. 
This is consistent with the third sentence of current Sec.  
206.117(b)(1)(i), except for FEMA replacing ``includes'' with ``may 
include,'' adding ``lodging expense'' before ``reimbursement,'' 
replacing ``that'' with ``for,'' and adding ``who have not received 
displacement assistance (See Sec.  206.119(b)(2))'' after 
``households,'' and removing ``incur'' for clarity. FEMA adds the 
cross-reference to the displacement assistance regulations for ease of 
review.
    In Sec.  206.117(b)(1)(i)(A), FEMA states that FEMA will include 
all members of a pre-disaster household in a single registration and 
will provide assistance for one temporary housing residence, unless 
FEMA determines that the size or nature of the household requires that 
we provide assistance for more than one residence. This sentence is 
consistent with the current Sec.  206.117(b)(1)(i)(A), except for FEMA 
replacing ``the Regional Administrator or his/her designee'' with 
``FEMA'' for consistency.
    In the first sentence of Sec.  206.117(b)(1)(i)(B), FEMA states 
that FEMA will base the amount of assistance on the current fair market 
rent for existing rental units. This sentence is consistent with the 
current first sentence of Sec.  206.117(b)(1)(i)(B), except for FEMA 
replacing ``rental'' with ``amount of'' for clarity; removing 
``Department of Housing and Urban Development's,'' as it is 
duplicative; and replacing ``rates'' with ``rent'' for clarity. FEMA 
replaces ``fair market rates'' with ``fair market rent'' as the defined 
term at Sec.  206.111 is ``fair market rent.'' Additionally, the 
definition of ``fair market rent'' states that the fair market rental 
rates applied are those identified by the Department of Housing and 
Urban Development as being adequate for existing rental housing in a 
particular area; since the term provides that the rates are identified 
by HUD, FEMA does not need to repeat that in the first sentence of 
Sec.  206.117(b)(1)(i)(B).
    In the second sentence of Sec.  206.117(b)(1)(i)(B), FEMA states 
that FEMA will further base the applicable rate on the location of the 
rental unit and the number of bedrooms the household requires, as 
determined by FEMA. This sentence is consistent with the current second 
sentence of Sec.  206.117(b)(1)(i)(B), except for FEMA removing the 
phrase ``household's bedroom requirement and the'' from the beginning 
of the sentence and replacing it with the clarifying phrase ``and the 
number of bedrooms the households requires, as determined by FEMA'' to 
the end of the sentence. This will codify existing policy and practice 
that FEMA determines the number of bedrooms a household requires, for 
clarity.\336\
---------------------------------------------------------------------------

    \336\ See the ``fair market rent'' box on page 109 of Chapter 3: 
V.E.2. of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    In Sec.  206.117(b)(1)(i)(C), FEMA states that rental assistance 
may include the payment of the cost of utilities, excluding telephone, 
cable, television, and internet service. This sentence is not 
consistent with current Sec.  206.117(b)(1)(i)(C), as the current 
regulations state that all utility costs and utility security deposits 
are the responsibility of the occupant except where the utility does 
not meter utility services separately and utility services are part of 
the rental charge. Section 689d of PKEMRA \337\ updated section 408 of 
the Stafford Act, at 42 U.S.C. 5174(c)(1)(A), to allow for the payment 
of the cost of utilities, excluding telephone service. This currently 
is implemented via the IAPPG 1.1 at Chapter 3: IV.B. which further 
explains this distinction between essential and non-essential utilities 
and clarifies that cable, TV, and internet service are also 
excluded.\338\ The IFR will codify this provision of the IAPPG 1.1.
---------------------------------------------------------------------------

    \337\ Post-Katrina Emergency Management Reform Act of 2006, 109-
295, 120 Stat. 1452 (Oct. 4, 2006), 6 U.S.C. 701 note.
    \338\ See page 80 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    In Sec.  206.117(b)(1)(i)(D), FEMA states that rental assistance 
may include the payment of the cost of security deposits, not to exceed 
an amount equal to the fair market rent for one month, as determined 
under paragraph (b)(1)(i)(B) of Sec.  206.117. This sentence is not 
consistent with the current two sentences of Sec.  206.117(b)(1)(i)(D), 
as the current regulations state that the occupant is responsible for 
all housing security deposits and that in extraordinary circumstances, 
the Regional Administrator or his/her designee may authorize the 
payment of security deposits; however, the owner or occupant must 
reimburse the full

[[Page 4042]]

amount of the security deposit to the Federal Government before or at 
the time that the temporary housing assistance ends. Section 689d of 
PKEMRA updated the Stafford Act, at 42 U.S.C. 5174(c)(1)(A), to allow 
for the payment of security deposits. Currently, FEMA implements 
Section 689d of PKEMRA via the IAPPG 1.1 at Chapter 3: IV.C.2.,\339\ 
and FEMA limits security deposits to the amount equal to one month's 
rent, if applicable. Therefore, the changes at Sec.  
206.117(b)(1)(i)(D) are more limiting then the PKEMRA amendment, but 
consistent with current practice.
---------------------------------------------------------------------------

    \339\ See page 84 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    In Sec.  206.117(b)(1)(i)(E), FEMA states that applicants that 
receive displacement assistance under Sec.  206.119(b)(2) must request 
rental assistance if their disaster-caused temporary housing needs 
continue once displacement assistance is exhausted. This new paragraph 
is for public transparency. With the new displacement assistance, if an 
applicant wants to receive rental assistance after receiving 
displacement assistance, they now have to contact FEMA to let FEMA know 
that they need continued temporary housing assistance in the form of 
rental assistance. If FEMA did not propose Sec.  206.117(b)(1)(i)(E), 
the only notification the public would have of this would be from the 
second sentence of Sec.  206.114(a), which says that FEMA may provide 
initial and CTHA, financial or direct, upon request during the period 
assistance.
    In Sec.  206.117(b)(1)(ii)(A), FEMA states that FEMA may provide 
direct assistance in the form of purchased or leased temporary housing 
units directly to displaced applicants who lack available housing 
resources and are unable to make use of the assistance provided under 
paragraph (b)(1)(i) of Sec.  206.117. This sentence is consistent with 
the current Sec.  206.117(b)(1)(ii)(A), except for FEMA replacing 
``individuals or households'' with ``displaced applicants'' and 
replacing ``would be'' with ``are'' for clarity.
    In Sec.  206.117(b)(1)(ii)(B), FEMA states that FEMA will include 
all members of a pre-disaster household in a single application and 
will provide assistance for one temporary housing unit, unless FEMA 
determines that the size or nature of the household requires that we 
provide assistance for more than one temporary housing unit. This is 
consistent with current Sec.  206.117(b)(1)(ii)(B), except for FEMA 
replacing ``residence'' with ``unit;'' replacing ``the Regional 
Administrator or his/her designee'' with ``FEMA;'' and replacing 
``residence'' with ``temporary housing unit,'' for clarity and 
consistency.
    In Sec.  206.117(b)(1)(ii)(C), FEMA states that any site upon which 
a FEMA-provided temporary housing unit is placed must comply with 
applicable State and local codes and ordinances, as well as 44 CFR part 
9, Floodplain Management and Protection of Wetlands, and all other 
applicable environmental and historic preservation laws, regulations, 
Executive orders, and agency policy. This is consistent with current 
Sec.  206.117(b)(1)(ii)(C), except for FEMA adding ``temporary'' before 
``housing'' for consistency and replacing ``Orders'' with ``orders'' 
for formatting purposes.
    In Sec.  206.117(b)(1)(ii)(E), FEMA states that FEMA-provided or 
funded temporary housing units may be placed in the locations, listed 
in subparagraphs (1)-(4). This is consistent with current Sec.  
206.117(b)(1)(ii)(E), except that for consistency FEMA adding 
``temporary'' before ``housing.''
    In Sec.  206.117(b)(1)(ii)(E)(1), FEMA states that FEMA-provided or 
funded temporary housing units may be placed at a commercial site that 
is complete with utilities, when FEMA determines that the upgrading of 
commercial sites, or installation of utilities on such sites, will 
provide more cost-effective, timely and suitable temporary housing than 
other types of resources. This is consistent with current Sec.  
206.117(b)(1)(ii)(E)(1), except for FEMA replacing ``the Regional 
Administrator or his/her designee'' with ``FEMA'' for consistency and 
removing the superfluous clause ``then Federal assistance may be 
authorized for such actions.''
    In Sec.  206.117(b)(1)(ii)(E)(2), FEMA states that FEMA-provided or 
funded temporary housing units may be placed at a private site that an 
applicant provides, complete with utilities, when FEMA determines that 
the cost of installation or repairs of essential utilities on private 
sites will provide more cost effective, timely, and suitable temporary 
housing than other types of resources. This is consistent with current 
Sec.  206.117(b)(1)(ii)(E)(2), except for FEMA replacing ``the Regional 
Administrator or his/her designee'' with ``FEMA'' for consistency and 
removing the superfluous clause ``then Federal assistance may be 
authorized for such actions.''
    In Sec.  206.117(b)(1)(ii)(E)(3), FEMA states that FEMA-provided or 
funded temporary housing units may be placed at a group site that 
accommodates two or more temporary housing units and is complete with 
utilities, provided by the State or local government, when FEMA 
determines that the cost of developing a group site provided by the 
State or local government, to include installation or repairs of 
essential utilities on the sites, will provide more cost effective, 
timely, and suitable temporary housing than other types of resources. 
This is consistent with current Sec.  206.117(b)(1)(ii)(E)(3), except 
for clarity and consistency FEMA adds ``temporary housing'' before 
``units,'' replaces ``the Regional Administrator or his/her designee'' 
with ``FEMA,'' removes the superfluous clause ``then Federal assistance 
may be authorized for such actions,'' and reorganizes the first portion 
of subparagraph (3) for clarity and consistency.
    In Sec.  206.117(b)(1)(ii)(E)(4), FEMA states that FEMA-provided or 
funded temporary housing units may be placed at a group site provided 
by FEMA, if determined that such a site would be more economical or 
accessible than one that the State or local government provides. This 
is consistent with current Sec.  206.117(b)(1)(ii)(E)(4), except for 
FEMA replacing ``the Regional Administrator or his/her designee'' with 
``FEMA'' for consistency and replacing ``determines'' with 
``determined'' for grammar purposes.
    In Sec.  206.117(b)(1)(ii)(F), FEMA states that if FEMA determines 
it would be a cost-effective alternative to other temporary housing 
options, FEMA may enter into lease agreements with owners of 
multifamily rental housing properties to house displaced applicants 
eligible for assistance under subpart D.
    In Sec.  206.117(b)(1)(ii)(F)(1), FEMA states that FEMA may only 
enter into lease agreements with owners of multifamily rental housing 
properties impacted by a major disaster or located in areas covered by 
a major disaster declaration.
    In Sec.  206.117(b)(1)(ii)(F)(2), FEMA states that FEMA may make 
repairs or improvements to properties under such lease agreements, to 
the extent necessary to serve as temporary housing, provided, however, 
that the value of the improvements or repairs must be deducted from the 
value of the lease agreement.
    FEMA is adding these subparagraphs since section 1103 of SRIA \340\ 
established FEMA's authority to lease and repair rental units located 
in areas covered by a major disaster declaration for temporary housing 
of applicants,

[[Page 4043]]

and section 1213 of DRRA \341\ reaffirmed this authority.\342\ 
Currently, FEMA has no regulations specific to the selection of 
properties to be leased and repaired, the types of repairs that may be 
funded, or the intention that these rental units are to be used as a 
type of Direct Temporary Housing Assistance. Therefore, this IFR will 
detail the requirements of implementing Multifamily Lease and Repair as 
a form of Direct Temporary Housing Assistance.
---------------------------------------------------------------------------

    \340\ 42 U.S.C. 5174(c)(1)(B).
    \341\ Disaster Recovery Reform Act of 2018, Pub. L. 115-254, 132 
Stat. 3448 (Oct. 5, 2018), 42 U.S.C. 5174 (c)(1)(B).
    \342\ The DRRA added authorization for FEMA to lease and repair 
property impacted by a major disaster.
---------------------------------------------------------------------------

    However, FEMA currently has guidance regarding MLR that is 
consistent with Sec.  206.117(b)(1)(ii)(F). The IAPPG 1.1 at Chapter 3: 
V.E.2. added reference to an updated two-tier approval process for 
determining cost-effectiveness of MLR.\343\ Under this process, FEMA 
determines the cost-effectiveness of a potential MLR property, compared 
to other forms of Direct Temporary Housing Assistance, by estimating 
the cost of repairs or improvements to the property, estimating the 
value of the lease agreement, and calculating the net per-unit cost to 
FEMA. MLR property repairs may be approved by the RA or the Federal 
Coordinating Officer, if the RA has delegated the authority to the 
Federal Coordinating Officer, if the per unit cost does not exceed the 
average per unit acquisition cost of the smallest mobile housing unit 
in FEMA's inventory. If the per unit cost of the MLR property repairs 
does exceed this threshold amount, they must be approved by the IA 
Division Director and the RA or the Federal Coordinating Officer must 
provide a justification for why increasing MLR property costs above the 
per unit cost threshold is a more feasible, cost-effective, and 
survivor-centric solution.
---------------------------------------------------------------------------

    \343\ See page 109 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Additionally, FEMA currently has guidance regarding MLR that is 
consistent with Sec.  206.117(b)(1)(ii)(F)(1). On page 107 of the IAPPG 
1.1 at Chapter 3: V.E.1., FEMA states that properties eligible for MLR 
must be located in a county/jurisdiction designated for Individual 
Assistance.\344\
---------------------------------------------------------------------------

    \344\ Page 107 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    FEMA also currently has guidance regarding MLR that is consistent 
with Sec.  206.117(b)(1)(ii)(F)(2). On page 109 of the IAPPG 1.1 at 
Chapter 3: V.E.2., FEMA states that under the terms of any lease 
agreement for potential MLR property, the value of the improvements or 
repairs shall be deducted from the value of the lease agreement.\345\
---------------------------------------------------------------------------

    \345\ Page 109 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    In the first sentence of Sec.  206.117(b)(1)(ii)(G), FEMA states 
that after the end of the 18-month period of assistance, FEMA may begin 
to charge up to the fair market rent for each temporary housing unit 
provided. This sentence is consistent with the current first sentence 
of Sec.  206.117(b)(1)(ii)(F), except for FEMA removing ``rate'' from 
``fair market rent rate,'' since the defined term at Sec.  206.111 is 
``fair market rent'' not ``fair market rent rate.''
    The second and third sentences of Sec.  206.117(b)(1)(ii)(G) are 
consistent with the second and third sentences of current Sec.  
206.117(b)(1)(ii)(F), except for the change to the paragraph structure.
    Section 206.117(b)(1)(ii)(H) is consistent with current Sec.  
206.117(b)(1)(ii)(G), except for the change to the paragraph structure.
    Section 206.117(b)(1)(ii)(H)(1) through (3) is consistent with 
current Sec.  206.117(b)(1)(ii)(G)(1) through (3), except for the 
changes to the paragraph structure. In Sec.  206.117(b)(1)(ii)(H)(4) 
through (5), FEMA states that FEMA may terminate direct assistance for 
reasons that include, but are not limited to the following: the 
occupant(s) failed to comply with any term of the lease/rental 
agreement or other rules of the site where the temporary housing unit 
is located; or the occupant(s) does not provide evidence documenting 
that they are working towards a permanent housing plan. This is 
consistent with current Sec.  206.117(b)(1)(ii)(G)(4) through (5), 
except for FEMA adding ``temporary housing'' before ``unit'' for 
consistency and adding ``semicolon or'' after ``located'' as a 
technical correction.
    The first sentence of Sec.  206.117(b)(1)(ii)(I) is consistent with 
current Sec.  206.117(b)(1)(ii)(H), except for the changes to the 
paragraph structure.
    In the second sentence of Sec.  206.117(b)(1)(ii)(I), FEMA states 
that this notice will specify the reasons for termination of assistance 
and occupancy, the date of termination, the procedure for appealing the 
determination, and the occupant's liability for such additional charges 
as FEMA deems appropriate after the termination date, including fair 
market rent for the unit. This sentence is consistent with the current 
second sentence of Sec.  206.117(b)(1)(ii)(H), except for FEMA 
replacing ``the Regional Administrator or his/her designee'' with 
``FEMA'' to ensure continued consistency in processing across disasters 
at the national level.
    Section 206.117(b)(1)(ii)(J) through (b)(2) is consistent with 
current Sec.  206.117(b)(1)(ii)(I) through (b)(2), except for the 
changes to the paragraph structure.
    In Sec.  206.117(b)(2)(i), FEMA states that FEMA may provide 
financial assistance for the repair of an owner-occupied primary 
residence if: the eligibility criteria in Sec.  206.113 are met; FEMA 
determines the dwelling was damaged by the disaster; and the damage is 
not covered by insurance. This sentence is consistent with the current 
Sec.  206.117(b)(2)(i), except for FEMA removing the phrase ``real 
property components in'' before ``an owner-occupied primary 
residence;'' adding ``FEMA determines'' after ``met;'' removing ``to 
the component'' after ``damage'' and replacing ``component'' with 
``dwelling,'' as the Stafford Act does not limit repairs to 
``components'' and replacing ``owner's'' with ``owner-occupied'' for 
consistency as owner-occupied is the defined term in Sec.  206.111; 
removing the current Sec.  206.117(b)(2)(i)(B) that ``the component was 
functional immediately before the declared event'' and removing current 
Sec.  206.117(b)(2)(i)(E) that the ``repair of the component is 
necessary to ensure the safety or health of the occupant or to make the 
residence functional,'' and removing the clause ``and the damage was 
caused,'' since FEMA is paying for pre-existing conditions if the 
component itself was damaged by the disaster.
    In Sec.  206.117(b)(2)(ii), FEMA states that FEMA may provide 
financial assistance for the repair of the disaster damaged dwelling to 
a safe and sanitary living or functioning condition. This clause is 
consistent with the current Sec.  206.117(b)(2)(ii), except for FEMA 
adding ``the disaster damaged dwelling to a safe and sanitary living or 
functioning condition including'' after ``of.'' These additions align 
with the changes that make it clear that only disaster damaged 
dwellings (regardless of their pre-disaster condition) may receive 
repair assistance, as FEMA may only pay to restore disaster damage to a 
safe and sanitary living or functioning condition. If the dwelling was 
not touched by the disaster, it will not be eligible for repair 
assistance.
    In response to public comments, FEMA is also changing the 
regulatory text at Sec.  206.117(b)(2) and a new Sec.  206.113(a)(9) as 
a part of this IFR. The changes will allow FEMA flexibility to provide 
financial assistance to applicants for the installation or

[[Page 4044]]

construction of real property items that were not present in the home 
prior to the disaster. Specifically, these changes will allow IHP to 
expand its existing policy, which provides for the installation of ADA 
related real property to applicants with disaster-caused needs, to 
include Home Repair Assistance for disaster survivors with pre-
existing, pre-disaster needs for accessibility-related items, such as 
an exterior ramp, grab bars, etc., that make their home safe and 
functional when any level of disaster-caused real property damage 
occurs to the primary residence.
    In new Sec.  206.113(a)(9), FEMA states that FEMA may provide 
assistance with respect to home repair for accessibility-related items, 
if an applicant meets the following conditions: (i) the applicant is 
either an individual with a disability as defined in 42 U.S.C. 5122 
whose disability existed prior to the disaster and whose primary 
residence was damaged by the disaster, or an individual with a 
disability as defined in 42 U.S.C. 5122 whose disability was caused by 
the disaster and whose primary residence was damaged by the disaster; 
(ii) the real property component is necessary to meet the 
accessibility-related need of the household; and (iii) the real 
property component is not covered by insurance or any other source.
    Via information collection 1660-0002, we are adding a documentation 
requirement to tie the need for the home repair accessibility-related 
items: ramp, grab bars, and/or paved pathway to the pre-existing 
disability to meet the household's access and functional need. We are 
requiring that a medical, health care, or rehabilitation professional 
certify whether or not this is necessary; as, they have the expertise 
to make that determination or, we will accept prior medical, health 
care, or rehabilitation professional documentation that supports the 
need for the accessibility-related items. FEMA requests comment on 
whether this is the appropriate level of documentation needed to 
confirm the necessity of accessibility-related items or if FEMA should 
pursue less burdensome documentation requirements.
    FEMA makes the below changes to Home Repair Assistance to 
adjudicate four RFI comments,\346\ so that FEMA may make the dwelling 
safe/sanitary for pre-disaster disabled applicants. For example, this 
change will allow FEMA to reimburse pre-disaster disabled applicants 
for accessibility items, such as grab bars and access ramps, if the 
primary residence sustained disaster damage regardless of whether or 
not the applicant had grab bars or access ramps pre-disaster. If the 
dwelling was not touched by the disaster, it will not be eligible for 
repair assistance; therefore, the applicant will not be able to apply 
for Home Repair Assistance for their pre-existing, pre-disaster needs 
for accessibility-related items, such as an exterior ramp, grab bars, 
etc., that make their home safe and functional.
---------------------------------------------------------------------------

    \346\ FEMA-2021-0011-0152, FEMA-2021-0011-0164, FEMA-2021-0011-
0235, and FEMA-2021-0011-0261.
---------------------------------------------------------------------------

    In Sec.  206.117(b)(2)(ii)(H), FEMA states that FEMA may provide 
financial assistance for eligible hazard mitigation measures. This is 
consistent with current Sec.  206.117(b)(2)(ii)(H), except for FEMA 
removing the phrase ``items or services determined to be'' for clarity, 
as FEMA never defined what ``items or services'' meant in context of 
mitigation measures and the removing of the phrase ``that reduce the 
likelihood of future damage to the residence, utilities, or 
infrastructure'' as that is now part of the defined term ``Eligible 
hazard mitigation measures.''
    In the first sentence of Sec.  206.117(b)(2)(iii), FEMA states that 
FEMA financial assistance for the repair of disaster damage will be 
limited to repairs of quality necessary for a safe and sanitary living 
or functioning condition. This is not consistent with current Sec.  
206.117(b)(2)(iii), as FEMA has changed its position regarding pre-
existing conditions. Rather, FEMA now repairs the home to a safe and 
sanitary living or functioning condition to align with the 
``functioning condition'' provision listed in 42 U.S.C. 5174 
(c)(2)(A)(i) of the Stafford Act.
    In the second sentence of Sec.  206.117(b)(2)(iii), FEMA states 
that in some instances, when the extent of the damage is unclear, FEMA 
may provide assistance for the average cost of a licensed technician's 
professional assessment. The second sentence of Sec.  
206.117(b)(2)(iii) is new regulatory text which indicates that FEMA may 
pay for the average cost of a licensed technician's professional 
assessment in some situations when the extent of the damage is unclear. 
While that situation has typically presented itself when FEMA is 
considering providing assistance for damages to more complex items that 
affect the habitability of the home, like furnaces, wells, septic 
systems, roads, bridges, or retaining walls, there may be other 
situations in which we will need that kind of assessment. So, FEMA has 
left Sec.  206.117(b)(2)(iii) general to allow for flexibility.
    Currently, under page 86 of the IAPPG 1.1, FEMA lists that for 
wells, furnaces, and septic systems, FEMA may provide assistance or 
reimbursement for the cost of a licensed technician's professional 
assessment associated with the repair or replacement of those 
components. Additionally, when verifiable receipts or estimates are 
submitted on appeal, FEMA may pay up to the actual cost of the receipt 
or estimate for wells, furnaces, and septic systems. Thus, the new 
regulatory text for the second sentence of Sec.  206.117(b)(2)(iii), 
will codify FEMA's policy and practice, in place since 2000, of 
providing assistance for the average cost of a licensed technician's 
professional assessment.
    In the third sentence of Sec.  206.117(b)(2)(iii), FEMA states that 
FEMA may provide for the replacement of a component if repair is not 
feasible. This is consistent with the fourth sentence of current Sec.  
206.117(b)(2)(iii), except for FEMA adding an ``a'' after ``of'' for 
clarity and replacing ``components'' with ``component'' for grammar 
purposes.
    FEMA removes the current Sec.  206.117(b)(2)(iv) that states that 
components that were functional immediately before the declared event 
may be eligible for repair assistance if the damage to the component 
was caused by the disaster and the component is no longer functional. 
The reason for the removal is FEMA's policy change. In this IFR, FEMA 
will provide assistance to repair or replace a disaster-damaged 
component, room, or area as long as the dwelling incurred disaster 
damage, including damage that was exacerbated by the disaster and 
requires repair or replacement to make the home habitable. If the 
dwelling was not touched by the disaster, it will not be eligible for 
repair assistance.
    In Sec.  206.117(b)(2)(iv), FEMA states that eligible individuals 
or households may receive up to the maximum amount of assistance (See 
Sec.  206.110(b)) to repair damage to their primary residence 
irrespective of other financial resources, except insurance proceeds. 
This sentence is consistent with the current Sec.  206.117(b)(2)(v), 
except for FEMA removing the italicization of ``See'' to correct a 
formatting error, removing ``of this part'' as to conform with the 
Federal Register Document Drafting Handbook regarding cross-
referencing, and revising ``damages'' to ``damage'' for clarity.
    Section 206.117(b)(2)(v) is consistent with current Sec.  
206.117(b)(2)(vi), except for the change to the paragraph structure.

[[Page 4045]]

    In the first sentence of Sec.  206.117(b)(2)(vi), FEMA states that 
if the applicant disputes a determination made by FEMA regarding 
eligibility for repair assistance, the applicant may appeal that 
determination pursuant to the procedures in Sec.  206.115. This is 
consistent with current Sec.  206.117(b)(2)(vii), except for changing 
the paragraph structure and removing of ``of this part.'' The removal 
of ``of this part'' is to conform with the Federal Register Document 
Drafting Handbook regarding cross-referencing.
    In the second sentence of Sec.  206.117(b)(2)(vi), FEMA states that 
in addition to the requirements in Sec.  206.115, the applicant must 
provide proof that the component meets the requirements of paragraph 
(b)(2)(i) of Sec.  206.117. This sentence is consistent with the second 
sentence of current Sec.  206.117(b)(2)(vii), except for FEMA removing 
the clause ``including that the component was functional before the 
declared event and proof that the declared event caused the component 
to stop functioning.'' The reason for the clause's removal is that FEMA 
is making a policy change that only disaster damaged components 
(regardless of their pre-disaster condition) may receive repair 
assistance, as FEMA may only pay to restore disaster damage to a safe 
and sanitary living or functioning condition.
    The third sentence of Sec.  206.117(b)(2)(vi) is consistent with 
current Sec.  206.117(b)(2)(vii), except for the change to the 
paragraph structure.
    In Sec.  206.117(b)(3)(i), FEMA states that FEMA may provide 
financial assistance for the replacement of an owner-occupied primary 
residence if: the eligibility criteria in Sec.  206.113 are met; the 
residence was destroyed by the disaster; and the damage to the 
residence is not covered by insurance. This sentence is consistent with 
current Sec.  206.117(b)(3)(i), except for FEMA replacing ``owner's'' 
with ``owner-occupied'' before ``primary residence;'' removing ``of 
this part'' from current Sec.  206.117(b)(3)(i)(A) for consistency; 
removing the current Sec.  206.117(b)(3)(i)(B), which states that the 
residence was functional immediately before the disaster; removing the 
following clause from the current Sec.  206.117(b)(3)(i)(C) ``and the 
damage was caused;'' removing the current Sec.  206.117(b)(3)(i)(E), 
which states that repair is not feasible, will not ensure the safety or 
health of the occupant, or will not make the residence functional; and 
removing the current Sec.  206.117(b)(3)(i)(F), which states that 
replacement is necessary to ensure the safety or health of the 
occupant. These additions align with the policy changes that the 
residence does not have to be functional immediately before the 
disaster and that all of the damage to the residence need not have been 
caused by the disaster since FEMA is paying for pre-existing damage.
    In the first sentence of Sec.  206.117(b)(3)(ii), FEMA replaces the 
first sentence with the second sentence of current Sec.  
206.117(b)(3)(ii), except for FEMA removing the italicization of 
``See'' to correct a formatting error and removing ``of this part'' for 
consistency. FEMA is removing the first sentence of current Sec.  
206.117(b)(3)(ii), which states that all replacement assistance awards 
must be approved by the Regional Administrator or his/her designee to 
ensure continued consistency in processing across disasters at the 
national level.
    In Sec.  206.117(b)(3)(iii), FEMA states that housing replacement 
assistance will be based on the average replacement cost established by 
FEMA for the type of residence destroyed, or the statutory maximum (See 
Sec.  206.110(b)), whichever is less. This sentence is consistent with 
current Sec.  206.117(b)(3)(iii), except for FEMA replacing ``verified 
disaster related level of damage to the dwelling'' with ``average 
replacement cost established by FEMA for the type of residence 
destroyed'' and removing ``of this part'' for consistency. FEMA's 
clarifying revisions are to help the public understand that since FEMA 
has already said that the residence must be destroyed or cannot be 
repaired, that FEMA will pay replacement assistance based on the 
average replacement cost established by FEMA for the type of residence 
destroyed.
    In the first sentence of Sec.  206.117(b)(3)(iv), FEMA states that 
if the applicant disputes a determination made by FEMA regarding 
eligibility for replacement assistance, the applicant may appeal that 
determination pursuant to the procedures in Sec.  206.115. This 
sentence is consistent with the current first sentence of Sec.  
206.117(b)(3)(iv), except for FEMA removing ``of this part'' to conform 
with the Federal Register Document Drafting Handbook regarding cross-
referencing.
    In the second sentence of Sec.  206.117(b)(3)(iv), FEMA states that 
in addition to the requirements in Sec.  206.115, the applicant must 
provide proof that repair is not feasible, or will not ensure the 
safety or health of the occupant. This sentence is consistent with the 
current second sentence of Sec.  206.117(b)(3)(iv), except for FEMA 
removing the clause ``or make the residence functional'' based on the 
policy changes that FEMA has previously discussed in this IFR that the 
residence no longer has to be functional pre-disaster.
    In Sec.  206.117(b)(4)(i)(A), FEMA states that FEMA may provide 
financial or direct assistance to applicants for the purpose of 
constructing permanent and semi-permanent housing if the eligibility 
criteria in Sec.  206.113 are met. This is consistent with current 
Sec.  206.117(b)(4)(i)(A), except for FEMA removing ``of this part'' to 
conform with the Federal Register Document Drafting Handbook regarding 
cross-referencing.
    In Sec.  206.117(b)(4)(i)(B), FEMA deletes the current Sec.  
206.117(b)(4)(i)(B), which states that the residence was functional 
immediately before the declared event, based upon the policy changes 
that the residence no longer has to be functioning immediately before 
the declared event.
    Section 206.117(b)(4)(i)(B) through (D) is consistent with current 
Sec.  206.117(b)(4)(i)(C) through (E), except for changing the 
paragraph structure.
    In Sec.  206.117(b)(4)(i)(E), FEMA states that FEMA may provide 
financial or direct assistance to applicants to construct permanent and 
semi-permanent housing if the residence is in a location where 
alternate housing resources are not available and the types of 
financial or direct temporary housing assistance described in paragraph 
Sec.  206.117(b)(1), (2), and (3) are unavailable, infeasible, or not 
cost-effective. This is consistent with current Sec.  
206.117(b)(4)(i)(F), except for FEMA removing ``located'' as it is 
repetitive and replacing the phrase ``an insular area outside the 
continental United States or in another'' with ``a'' before 
``location'' as a simplifying edit for clarity. There is no reason to 
include the phrase, as the point of the sentence is that the residence 
is in a location where no alternative housing resources are available.
    In the first sentence of Sec.  206.117(b)(4)(iii), FEMA states that 
if the applicant disputes a determination made by FEMA regarding 
eligibility for construction assistance, the applicant may appeal that 
determination pursuant to the procedures in Sec.  206.115. This is 
consistent with the first sentence in current Sec.  206.117(b)(4)(iii), 
except for FEMA removing ``of this part'' to conform with the Federal 
Register Document Drafting Handbook regarding cross-referencing.
    In the second sentence of Sec.  206.117(b)(4)(iii), FEMA states 
that in addition to the requirements in Sec.  206.115, the applicant 
must provide proof that the property is in a location where alternative 
housing resources are

[[Page 4046]]

not available. This is consistent with current Sec.  
206.117(b)(4)(iii), except for FEMA removing the phrase ``either 
located in an insular area outside the continental United States or'' 
as a simplifying edit for clarity. There is no reason to include the 
phrase as the point of the sentence is that the residence is in a 
location where no alternative housing resources are available.

I. Section 206.118--Disposal of Housing Units

    In Sec.  206.118(a) through (1), FEMA states that FEMA may sell 
temporary housing units purchased under Sec.  206.117(b)(1)(ii), 
Temporary housing, direct assistance, as follows: sale to an occupant. 
This is consistent with the current Sec.  206.118(a) through (1), 
except for FEMA adding ``temporary'' before ``housing units'' for 
clarity and replacing ``applicant'' with ``occupant'' for clarity in 
reference to those who attempt to purchase the temporary housing unit 
they occupy during their period of FEMA individual assistance.
    In Sec.  206.118(a)(1)(i), FEMA states that FEMA may sell a 
temporary housing unit to the occupant, if they lack permanent housing 
and have a site that complies with local codes and ordinances and 44 
CFR part 9. This is consistent with the current Sec.  206.118(a)(1)(i), 
except for FEMA replacing ``sale'' with the clause ``FEMA may sell a 
temporary housing unit;'' replacing ``individual or household'' with 
``occupant;'' removing ``occupying the unit;'' replacing ``the 
occupant'' with ``they;'' replacing ``lacks'' with ``lack'' for grammar 
purposes; replacing the ``comma'' after ``permanent housing'' with 
``and;'' and replacing ``has'' with ``have'' for grammar purposes. 
These changes are for clarity and consistency.
    In Sec.  206.118(a)(1)(ii), FEMA removes the paragraph heading 
``adjustment to the sales price'' for consistency and to comply with 
the Federal Register Document Drafting Handbook, as the rest of the 
paragraphs at that level do not have paragraph headings.
    In Sec.  206.118(a)(1)(ii), FEMA states that FEMA may approve 
adjustments to the sales price when selling a temporary housing unit to 
the occupant if the occupant is unable to pay the fair market value of 
the temporary housing unit and when doing so is in the best interest of 
the occupant and FEMA. This is consistent with current Sec.  
206.118(a)(1)(ii), except for FEMA adding ``temporary'' before 
``housing unit'' for clarity; removing ``of a unit;'' replacing 
``purchaser'' with ``occupant'' for consistency and because 
``occupant'' is a defined term in Sec.  206.111; replacing ``home or'' 
with ``temporary housing unit;'' and replacing ``applicant'' with 
``occupant'' for consistency.
    In Sec.  206.118(a)(1)(iii), FEMA states that FEMA may sell a 
temporary housing unit to the occupant only on the condition that the 
purchaser agrees to obtain and maintain hazard insurance, as well as 
flood insurance on the temporary housing unit if it is or will be in a 
designated Special Flood Hazard Area. This is consistent with current 
Sec.  206.118(a)(1)(iii), except for FEMA adding ``temporary'' before 
``housing unit'' and ``temporary housing'' before ``unit'' for 
consistency.
    In Sec.  206.118(a)(2), FEMA replaces a colon with a period for 
grammar purposes. In the first sentence of Sec.  206.118(a)(2)(i), FEMA 
states that FEMA may sell, transfer, donate, or otherwise make a 
temporary housing unit available directly to a State or other 
governmental entity, or to a voluntary organization, for the sole 
purpose of providing temporary housing to eligible displaced applicants 
in major disasters and emergencies. This is consistent with the first 
sentence of current Sec.  206.118(a)(2)(i), except for FEMA adding 
``temporary housing'' before ``unit'' for consistency and replacing 
``disaster victims'' with ``eligible displaced applicants'' for 
consistency and clarity.
    In Sec.  206.118(a)(2)(i)(B), FEMA states that the State, 
governmental entity, or voluntary organization must agree to obtain and 
maintain hazard insurance on the temporary housing unit, as well as 
flood insurance if the housing unit is or will be in a designated 
Special Flood Hazard Area. This is consistent with current Sec.  
206.118(a)(2)(i)(B), except for FEMA adding ``temporary housing'' 
before ``unit'' for consistency.
    In Sec.  206.118(a)(2)(ii), FEMA states that FEMA may also sell 
temporary housing units at a fair market value to any other person. 
This is consistent with current Sec.  206.118(a)(2)(ii), except for 
FEMA adding ``temporary'' before ``housing units'' for consistency.
    In the first sentence of Sec.  206.118(b), FEMA states that a 
temporary housing unit will be sold ``as is, where is,'' except for 
repairs FEMA deems necessary to protect health or safety, which are to 
be completed before the sale. This is consistent with current Sec.  
206.118(b), except for FEMA adding ``temporary housing'' before 
``unit'' for consistency.
    In the third sentence of Sec.  206.118(b), FEMA states that in 
addition, FEMA will inform the purchaser that they may have to bring 
the installation of the temporary housing unit up to codes and 
standards that are applicable at the proposed site. This is consistent 
with the third sentence of Sec.  206.118(b), except for FEMA replacing 
``he/she'' with ``they'' and for adding ``temporary housing'' before 
``unit'' for consistency. Plus, we are making these changes for 
clarity; as FEMA has always meant ``temporary housing unit'' when we 
used ``unit'' and FEMA has always meant that the installation of the 
temporary housing unit has to be up to codes and standards.

J. Section 206.119--Financial Assistance To Address Other Needs

    In Sec.  206.119(a), FEMA states that FEMA and the State may 
provide financial assistance to individuals and households who are 
adversely affected by a major disaster and have other verifiable, 
documented disaster-related necessary expenses or serious needs. This 
is consistent with current Sec.  206.119(a), except for FEMA adding the 
clause ``are adversely affected by a major disaster and'' after 
``households who'' for clarity; adding ``verifiable, documented'' 
before ``disaster-related'' for clarification; and removing the current 
second sentence of Sec.  206.119(a) and removing the current 
subparagraphs (a)(1) through (3) which state that to qualify for 
assistance under Sec.  206.119, an applicant must also: apply to the 
United States Small Business Administration's (SBA) Disaster Home Loan 
Program for all available assistance under that program; and be 
declined for SBA Disaster Home Loan Program assistance; or demonstrate 
that the SBA assistance received does not satisfy their total necessary 
expenses or serious needs arising out of the major disaster. FEMA 
removes the above-mentioned regulatory text, as the removal of the 
designation of ``SBA-dependent ONA'' allows FEMA to provide all 
eligible applicants ONA regardless of loan repayment worthiness.
    This aligns with the goal of the 2022-2026 FEMA Strategic Plan to 
instill equity as a foundation of emergency management by removing 
barriers to FEMA programs through a people first approach and achieving 
equitable outcomes for those we serve.\347\ The historically low 
percentage of applicants with SBA-dependent needs identified at 
inspection who choose to apply for and accept an SBA loan for these 
needs

[[Page 4047]]

indicates a gap in the correct recovery process which this change would 
address. This also assists the IA Division in responding to GAO 20-503 
on FEMA's Individuals and Households Program.\348\ This solution will 
also simplify applicant messaging for both FEMA and the SBA.
---------------------------------------------------------------------------

    \347\ Strategic Goal 3.1 2018-2022 FEMA Strategic Plan was to 
reduce the complexity of FEMA and to streamline the disaster 
survivor and grantee experience, which also would be furthered by 
these changes. The IFR also aligns with the 2022-2026 FEMA Strategic 
Plan, Goal 2: Lead whole of community in climate resilience; and 
Goal 3: Promote and sustain a ready FEMA and prepared Nation.
    \348\ GAO 20-503 touched on the confusion created by the current 
regulatory requirement that applicants apply for an SBA disaster 
loan prior to being considered for SBA-dependent ONA. The GAO made a 
formal recommendation that the FEMA Administrator should assess the 
extent to which its process for determining an applicant's 
eligibility for SBA-dependent other needs assistance limits or 
prevents survivors' access to IHP assistance, and work with SBA to 
identify options to simplify and streamline the disaster assistance 
application process for survivors.
---------------------------------------------------------------------------

    FEMA is removing the SBA requirement in order to streamline the 
application process and ensure all applicants can access assistance. 
However, we also recognize that doing so would allow applicants who 
might otherwise qualify for an SBA loan to instead receive a grant, 
thus increasing the cost of disaster assistance from the Disaster 
Relief Fund and reducing the potential for repayment of assistance. 
FEMA specifically seeks comment on the removal of the requirement to 
apply to the SBA to qualify for certain categories of assistance under 
ONA and whether FEMA should seek statutory authority for alternative 
ways to ensure higher income applicants first pursue SBA loans for this 
and other categories of assistance. From Sec.  206.119(b) onward, FEMA 
reorganizes the order of the types of assistance to first cover the two 
new types of assistance: serious needs and displacement. FEMA states 
that the new types of assistance should go first as they are first in 
the delivery sequence and these two types of assistance have specific 
registration deadlines. FEMA also employees new paragraph headings of 
``Serious needs'' and ``Displacement'' at Sec.  206.119(b)(1) and Sec.  
206.119(b)(2), respectively.
    In Sec.  206.119(b)(1), FEMA states that serious needs assistance 
is the necessary expenses to assist applicants who report they are 
displaced as a result of the disaster, who report a need for shelter as 
a result of the disaster, or who have other emergency disaster 
expenses. These needs will vary according to each applicant and FEMA 
will not require receipts documenting the use of this assistance. FEMA 
will adjust the amount of this assistance to reflect changes in the CPI 
for all Urban Consumers that the Department of Labor publishes.
    In Sec.  206.111, FEMA revises the definition of displaced 
applicant to mean one whose disaster-damaged primary residence is 
uninhabitable, inaccessible, or made unavailable by the landlord. All 
that is required by ONA is that the applicant is adversely affected by 
a disaster. In the ONA revisions at Sec.  206.119(b)(1), an applicant 
does not have to be displaced to receive the serious needs assistance 
which is why we did not limit the new serious needs to displaced 
applicants.
    In Sec.  206.119(b)(2), FEMA states that displacement assistance is 
the necessary expenses to assist displaced applicants with short-term 
living arrangements immediately following a disaster. Applicants must 
have registered within the 60-day or extended registration period. The 
award amount is based on a time period established by FEMA and approved 
in the State Administrative Option, as required by Sec.  206.120(b). 
FEMA will not require receipts documenting the use of this assistance.
    In Sec.  206.119(b)(2), FEMA states the difference between lodging 
expense reimbursement and displacement assistance. Section 
206.119(b)(2) does not require receipts for the new displacement 
assistance; while, lodging expense reimbursement does require receipts. 
Also, the new displacement assistance refers to the revised term 
displaced applicant which means one whose disaster-damaged primary 
residence is uninhabitable, inaccessible, or made unavailable by the 
landlord. By contrast, lodging expense reimbursement is for individuals 
or households who have not received displacement assistance under this 
section.
    In Sec.  206.119(b)(3), FEMA revises the paragraph heading to 
Medical and dental. This paragraph heading is consistent with the 
current Sec.  206.119(c)(3), paragraph heading except for FEMA removing 
``expenses'' and adding ``and dental.'' By changing the format of the 
paragraph headings in this section, FEMA is adding consistency in how 
each type of assistance is referred to.
    Also, in Sec.  206.119(b)(3), when describing eligible medical and 
dental assistance, FEMA states necessary expenses to assist applicants 
with medical and dental costs, which may include the following: medical 
service costs; dental service costs; repair or replacement of medical 
or dental equipment; loss or injury of a service animal; and costs for 
prescription medicines related to eligible medical or dental services, 
or which need to be replaced due to the disaster. This sentence is 
consistent with current Sec.  206.119(c)(3), except for FEMA replacing 
``medical'' with ``necessary'' before ``expenses'' for clarity; adding 
the clause ``to assist applicants with medical and dental costs which'' 
after ``expenses'' for clarity; removing ``are generally'' and 
``limited to'' and adding ``may include'' for clarity; adding 
``service'' between ``medical costs'' and ``dental costs'' for clarity 
and consistency; adding ``or dental'' before ``equipment;'' and adding 
the following new language ``loss or injury of a service animal; and 
costs for prescription medicines related to eligible medical or dental 
services, or which need to be replaced due to the disaster'' for 
clarity. FEMA currently covers the loss of prescription drugs in 
Chapter 3: VI.B.2. of the IAPPG 1.1,\349\ so it was not essential that 
we added the regulatory text, but we did so for clarity that these 
eligible costs may include medical services and prescription drugs. 
Currently, in Chapter 3: VI.B.2. of IAPPG 1.1 \350\ FEMA interprets 
current Sec.  206.119(c)(3)(iii) to include service animals. For 
clarity we are adding ``loss or injury of a service animal.''
---------------------------------------------------------------------------

    \349\ See page 153 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
    \350\ See page 153 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    In Sec.  206.119(b)(4), FEMA adds a paragraph heading of ``child 
care.'' This is a new paragraph with a new paragraph heading. 
Currently, FEMA does not have child care expenses ONA regulations.
    In Sec.  206.119(b)(4), FEMA states that child care assistance is 
for necessary expenses to assist applicants with child care costs, 
which may include the following: standard child care service fees, 
including personal assistance services that support activities of daily 
living for children with disabilities and registration and health 
inventory fees for applicants who require a new child care provider. 
FEMA adds child care expenses under ONA; as section 1108 of SRIA \351\ 
established child care as an eligible expense under the ONA provision 
of the IHP.\352\ This is a codification of a current existing policy 
and practice, as, currently FEMA implements child care assistance 
through the IAPPG 1.1.\353\
---------------------------------------------------------------------------

    \351\ 42 U.S.C. 5174(e)(1).
    \352\ Initially, the Recovery Policy, Disaster Assistance for 
Child Care 9461.1, Jan. 17, 2014, was the controlling policy. 
https://www.fema.gov/sites/default/files/2020-07/recovery-policy_disaster%20assistance-child-care.pdf.
    \353\ See pages 155-160, Child Care Assistance, of IAPPG 1.1. 
https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Currently, Sec.  206.119(c)(4) paragraph heading is ``funeral 
expenses.'' In Sec.  206.119(b)(5), FEMA changes the paragraph heading 
to ``funeral'' for

[[Page 4048]]

consistency with the other paragraph headings at that paragraph level.
    In Sec.  206.119(b)(5), FEMA states that funeral assistance is 
necessary expenses to assist applicants with funeral costs, which may 
include the following: funeral services; burial or cremation; and other 
related funeral expenses. This is consistent with the current Sec.  
206.119(c)(4), except for FEMA replacing ``funeral'' with ``necessary'' 
before ``expenses'' for clarity, adding the clause ``to assist 
applicants with funeral costs which'' after ``expenses'' for clarity, 
removing ``are generally limited to'' and adding ``may include'' for 
clarity and to parallel the language in Sec.  206.119(b)(3).
    In Sec.  206.119(b)(6), when describing eligible personal property 
assistance, FEMA includes necessary expenses to assist applicants whose 
primary residences were damaged by the disaster with personal property 
costs, which may include the following: clothing; household items, 
furnishings or appliances; computing devices; essential tools, 
specialized or protective clothing, computing devices, and equipment 
required for employment; computing devices, uniforms, schoolbooks and 
supplies required for educational purposes; and cleaning or sanitizing 
any eligible personal property item.\354\ This is consistent with the 
current Sec.  206.119(c)(1), except for FEMA replacing ``and serious 
needs for repair or replacement of'' with ``to assist applicants whose 
primary residences were damaged by the disaster with'' after 
``necessary expenses'' for clarity, adding ``costs'' after ``personal 
property'' for clarity, replacing ``are generally limited to'' with 
``may include'' before the ``the following'' for clarity and to 
parallel the language in Sec.  206.119(b)(3), adding a new subparagraph 
(iii) which includes ``computing devices'' to provide additional 
assistance under ONA personal property for one household computing 
device not related to employment or education, adding ``Essential'' 
before ``tools'' as FEMA adds a new definition of ``Essential tools'' 
in Sec.  206.111, adding ``computing devices'' after ``protective 
clothing,'' to allow them as eligible costs if the computing devices 
are for employment, replacing the phrase ``by an employer as a 
condition of'' with ``for'' before ``employment'' to reflect FEMA's 
policy change regarding self-employed essential tools; and replacing 
``computers'' with ``computing devices'' in 206.119(b)(6)(iv) for 
consistency since we are replacing ``computers'' with ``computing 
devices'' in the other subparagraphs in 206.119(b)(6).
---------------------------------------------------------------------------

    \354\ When the damages are not captured at inspection, an 
applicant must provide: an itemized receipt, estimate, or bill for 
repair or replacement of the disaster-damaged items; a written 
statement signed by the applicant verifying that the items were 
disaster-damaged and the written statement includes: ``I declare 
under penalty of perjury that the information I provided is true and 
correct.''
---------------------------------------------------------------------------

    While FEMA had previously provided assistance for damaged 
computers, it was limited to those computers that were required for 
educational purposes or as a condition of employment. Recognizing that 
technology continues to have an increasing role in how households 
communicate, manage finances, and facilitate many other necessary 
aspects of daily living, FEMA, via IHP, is expanding Personal Property 
Assistance so that a household may receive financial assistance for a 
disaster damaged computing device, regardless of its intended use. 
Applicants may receive financial assistance for additional damaged 
computing devices that are needed for educational purposes or as a 
condition of employment, to include self-employed individuals.
    In Sec.  206.119(b)(6), FEMA clarifies that the personal property 
was in a pre-disaster primary residence in a declared disaster area 
when FEMA adds the clause ``to assist applicants whose primary 
residences were damaged by the disaster.''
    The paragraph heading Sec.  206.119(b)(7) is the same as current 
Sec.  206.119(c)(2), except for the change to the paragraph structure.
    In Sec.  206.119(b)(7), when describing eligible transportation 
assistance, FEMA states that FEMA and the State may provide financial 
assistance to individuals and households including necessary expenses 
to assist applicants with transportation costs, which may include the 
following: repairing or replacing vehicles; public transportation; and 
other transportation related costs or services. This is consistent with 
the current Sec.  206.119(c)(2), except for FEMA removing ``or serious 
needs'' after ``necessary expenses'' and removing ``for'' before 
``transportation'' for clarity; adding the clause ``to assist 
applicants with'' before ``transportation'' and adding ``costs'' after 
``transportation'' for clarity; removing ``are generally limited to'' 
and adding ``which may include'' before ``the following'' for clarity 
and to parallel the language in Sec.  206.119(b)(3); and removing 
``and'' in current Sec.  206.119(c)(2)(i), removing ``financial 
assistance for'' before ``public,'' removing ``any;'' moving the clause 
``other transportation related costs or services'' from current Sec.  
206.119(c)(2)(ii) to Sec.  206.119(b)(7)(iii).
    The heading of Sec.  206.119(b)(8) addresses moving and storage. 
This is consistent with current Sec.  206.119(c)(5), except the heading 
does not include ``expenses.'' In Sec.  206.119(b)(8), when describing 
eligible moving and storage assistance, FEMA states that FEMA and the 
State may provide financial assistance to individuals and households 
including necessary expenses to assist applicants whose primary 
residences were damaged by the disaster with costs related to moving 
and storing personal property, which may include the following: moving 
and storing personal property to avoid additional disaster damage; 
storage of personal property while disaster-related repairs are being 
made to the primary residence; and return of the personal property to 
the individual or household's primary residence. This is consistent 
with current Sec.  206.119(c)(5), except for FEMA reorganizing this 
paragraph to include three subparagraphs so that it follows the format 
of the other paragraphs in this section. Also, Sec.  206.119(b)(8), 
removes ``and serious needs'' after ``necessary expenses,'' and adds 
the clause ``to assist applicants whose primary residences were damaged 
by the disaster with costs'' before ``related to moving and storing 
personal property'' for clarity and replaces ``generally'' with 
``may.''
    In Sec.  206.119(b)(9), the paragraph heading is Group Flood 
Insurance purchase, which is consistent with the current paragraph 
heading at Sec.  206.119(d), except for the paragraph structure. Since 
Group Flood Insurance is a type of assistance, it should be listed with 
the other types of assistance listed in Sec.  206.119(b) instead of, as 
currently stands, its own separate paragraph. In Sec.  206.119(b)(9), 
FEMA states that individuals identified by FEMA as eligible for 
assistance for flood insurable damage under the Stafford Act, 42 U.S.C. 
5174, as a result of flood damage caused by a Presidentially-declared 
major disaster and who reside in a special flood hazard area (SFHA) may 
be included in a Group Flood Insurance Policy (GFIP) established under 
the National Flood Insurance Program (NFIP) regulations at 44 CFR 
61.17. This sentence is consistent with current Sec.  206.119(d), 
except for FEMA replacing ``Other Needs assistance'' with ``assistance 
for flood insurable damage'' for clarity; removing ``section 408 of'' 
and adding ``42 U.S.C. 5174'' for clarity and public ease of reference.
    The first sentence of Sec.  206.119(b)(9)(i) is consistent with the 
current first

[[Page 4049]]

sentence of Sec.  206.119(d)(1), except for the paragraph structure. 
Currently, the first sentence of Sec.  206.119(d)(1), states that the 
premium for the GFIP is a necessary expense within the meaning of Sec.  
206.119. In the second sentence of Sec.  206.119(b)(9)(i), FEMA states 
that FEMA or the State must withhold this portion of the Other Needs 
award and provide it to the NFIP on behalf of individuals and 
households who are eligible for coverage. This is consistent with the 
current second sentence of Sec.  206.119(d)(1), except for FEMA 
replacing ``shall'' for ``must'' for purposes of plain language. In the 
third sentence of Sec.  206.119(b)(9)(i), FEMA states that the coverage 
must be equivalent to the maximum assistance amount established under 
the Stafford Act, 42 U.S.C. 5174. The is consistent with the current 
third sentence of Sec.  206.119(d)(1), except for FEMA replacing 
``shall'' with ``must'' for purposes of plain language and removing 
``section 408 of'' and adding ``42 U.S.C. 5174'' for clarity and public 
ease of reference.
    In the first sentence of Sec.  206.119(b)(9)(ii), FEMA states that 
FEMA or the State IHP staff must provide the NFIP with records of 
individuals who received assistance for flood-insurable losses within a 
SFHA and are to be insured through the GFIP. This is consistent with 
the current first sentence of Sec.  206.119(d)(2), except for FEMA 
replacing ``shall'' with ``must'' for purposes of plain language and 
replacing ``an ``Other Needs'' award'' with ``assistance for flood-
insurable losses within a SFHA'' for clarity. In the second sentence of 
Sec.  206.119(b)(9)(ii), FEMA states that records of applicants to be 
insured must be accompanied by payments to cover the premium amounts 
for each applicant for the 3-year policy term. This is consistent with 
the current second sentence of Sec.  206.119(d)(2), except for FEMA 
removing ``Other Needs'' for clarity and replacing ``shall'' with 
``must'' for purposes of plain language. The third and fourth sentences 
in Sec.  206.119(b)(9)(ii) are consistent with the third and fourth 
sentences in the current Sec.  206.119(d)(2).
    Section 206.119(b)(9)(iii) is consistent with current Sec.  
206.119(d)(3), except for the paragraph structure.
    In Sec.  206.119(b)(10), when describing eligible miscellaneous 
assistance, FEMA states that FEMA may provide assistance for other 
miscellaneous items or services that FEMA, in consultation with the 
State, determines are necessary expenses and serious needs. Section 
206.119(b)(10) is consistent with current Sec.  206.119(c)(6)(ii), 
except for FEMA adding a paragraph heading of ``Miscellaneous'' to 
Sec.  206.119(b)(10). This last paragraph for section 206.119 serves as 
a ``catch all'' for types of assistance under the necessary expenses 
and serious needs provisions of the Stafford Act.

K. Section 206.131--Individual and Family Grant Program for Major 
Disasters Declared on or Before October 14, 2002

    On September 30, 2002, FEMA issued regulations on the then-new 
Individuals and Households Program. The rule implemented the DMA2K and 
added Sec. Sec.  206.110-120 to subpart D of part 206 of FEMA's 
regulations. The previous regulations, relating to the superseded 
Individual and Family Grant Program, were retained in Sec.  206.131, 
but revised to apply only to disasters declared before October 15, 
2002, the effective date of the new Individuals and Households Program 
regulations. Since these old regulations are now outdated and no longer 
necessary, FEMA removes and reserves Sec.  206.131. Sections 206.132 
through 206.140 are currently reserved, so removing and reserving Sec.  
206.131 extends the existing reservation to Sec. Sec.  206.131-140.
    Since FEMA is removing Sec.  206.131 and reserving Sec.  206.131, 
FEMA also is revising the Subpart E--heading from ``Individual and 
Family Grant Programs' to ``Reserved'' for clarity.

L. Section 206.191--Duplication of Benefits

    In the first sentence of Sec.  206.191(a), FEMA states that Sec.  
206.191 establishes the policies for implementing the Stafford Act, 42 
U.S.C. 5155, entitled Duplication of Benefits. This sentence is 
consistent with current Sec.  206.191(a), except for FEMA removing 
``section 312 of'' and adding ``42 U.S.C. 5155'' after ``the Stafford 
Act.'' FEMA makes these edits for public ease of reference, as a United 
States Code cite is more accessible to the public and referencing the 
section of the Stafford Act just increases the length of the 
regulation.
    In the first sentence of Sec.  206.191(b)(1), FEMA states that 
Federal agencies providing disaster assistance under the Act or under 
their own authorities triggered by the Act, must cooperate to prevent 
and rectify duplication of benefits, according to the general policy 
guidance of the Federal Emergency Management Agency. This sentence is 
consistent with the first sentence of current Sec.  206.191(b)(1), 
except for FEMA replacing ``shall'' with ``must'' for purposes of plain 
language.
    In the second sentence of Sec.  206.191(b)(1), FEMA states that the 
agencies must establish appropriate agency policies and procedures to 
prevent duplication of benefits. This sentence is consistent with the 
second sentence of current Sec.  206.191(b)(1), except for FEMA 
replacing ``shall'' with ``must'' for purposes of plain language.
    In Sec.  206.191(d)(2), FEMA states that the delivery sequence is, 
in order of delivery: volunteer agencies' emergency assistance (except 
expendable items such as clothes, linens, and basic kitchenware); 
insurance (including flood insurance); housing assistance pursuant to 
the Stafford Act, 42 U.S.C. 5174; Other Needs assistance, pursuant to 
the Stafford Act, 42 U.S.C. 5174; Small Business Administration and 
Department of Agriculture disaster loans; Volunteer agencies' 
``additional assistance'' programs; and the ``Cora Brown Fund.'' This 
is consistent with current Sec.  206.191(d)(2), except for FEMA 
removing the Stafford Act section cites and replacing them with United 
States Code cites, which are more accessible to the public and 
switching the delivery sequence, so that FEMA disaster survivors do not 
have to go to SBA before seeking ONA assistance from FEMA. Also, FEMA 
removes ``Farmers Home Administration'' and replaces it with 
``Department of Agriculture'' since the Farmers Home Administration is 
now administered by the successor agencies of the Farmers Home 
Administration, so the ``Farmers Home Administration disaster loans'' 
are now the ``Department of Agriculture disaster loans.''
    In the first sentence of Sec.  206.191(d)(4), FEMA states that if 
following the delivery sequence concept would adversely affect the 
timely receipt of essential assistance by an individual or household, 
an agency may offer assistance which is the primary responsibility of 
another agency. This sentence is consistent with current Sec.  
206.191(d)(4), except for FEMA replacing ``a disaster victim'' with 
``an individual or household'' for consistency and clarity.
    In the Sec.  206.191(d)(4)(ii), FEMA states that in the case where 
the individual or household has refused assistance from Agency A, 
Agency A must notify Agency B that it must recover assistance 
previously provided. This sentence is consistent with current Sec.  
206.191(d)(4)(ii), except for FEMA replacing ``disaster victim'' with 
``individual or household'' for consistency and adding the clarifying 
phrase ``Agency A must'' before ``notify Agency B.''
    In Sec.  206.191(e)(1)(i), FEMA states that in making an 
eligibility determination, FEMA, in the case of federally operated

[[Page 4050]]

programs, or the State, in the case of State operated programs, must 
determine whether assistance is the primary responsibility of another 
agency to provide, according to the delivery sequence; and determine 
whether that primary response agency can provide assistance in a timely 
way. This sentence is consistent with current Sec.  206.191(e)(1)(i), 
except for FEMA revising ``the FEMA Regional Administrator'' to 
``FEMA'' for consistency and revising ``shall'' with ``must'' for 
purposes of plain language.
    In Sec.  206.191(e)(2), FEMA states that in making an eligibility 
determination, FEMA or the State must remind the applicant about his/
her responsibility to pursue an adequate settlement. In the second 
sentence of Sec.  206.191(e)(2)(iii), FEMA states that where flood 
insurance is involved, FEMA must coordinate with the Federal Insurance 
Administration. These sentences are consistent with current Sec.  
206.191(e)(2) and the second sentence of Sec.  206.191(e)(2)(iii), 
except for FEMA revising ``the FEMA Regional Administrator'' to 
``FEMA,'' as the RA is not involved; adding ``the'' before State for 
grammar purposes; and revising ``shall'' to ``must'' for purposes of 
plain language.
    In the first sentences of Sec.  206.191(e)(3), FEMA states that 
each disaster assistance agency is responsible for preventing and 
rectifying duplication of benefits under the general authority of the 
Stafford Act, 42 U.S.C. 5155. This sentence is consistent with current 
Sec.  206.191(e)(3), except for FEMA removing the phrase ``the 
coordination of the Federal Coordinating Officer (FCO) and,'' as field 
leadership does not coordinate the rectification of duplication of 
benefits; and revising ``section 312'' to ``the Stafford Act, 42 U.S.C. 
5155'' for clarity and public ease of reference.
    In the second sentence of Sec.  206.191(e)(3), FEMA states that to 
determine whether duplication has occurred and established procedures 
have been followed, FEMA must, within 90 days after the close of the 
disaster assistance program's application period, for selected disaster 
declarations, examine on a random sample basis, FEMA's and other 
government and voluntary agencies' case files and document the findings 
in writing. This sentence is consistent with the current second 
sentence of Sec.  206.191(e)(3), except for FEMA replacing ``the 
Regional Administrator'' with ``FEMA'' for consistency, replacing 
``shall'' with ``must'' for purposes of plain language, and replacing 
``programs'' with ``program's'' for grammar purposes.
    In Sec.  206.191(e)(4), FEMA states that if duplication is 
discovered, FEMA must determine whether the duplicating agency followed 
its own remedial procedures. This is consistent with current Sec.  
206.191(e)(4), except for FEMA replacing ``the Regional Administrator'' 
with ``FEMA'' for consistency and replacing ``shall'' with ``must'' for 
purposes of plain language.
    In the first sentence of Sec.  206.191(e)(4)(i), FEMA states that 
if the duplicating agency followed its procedures and was successful in 
correcting the duplication, FEMA will take no further action. This is 
consistent with current first sentence of Sec.  206.191(e)(4)(i), 
except for FEMA replacing ``the Regional Administrator'' with ``FEMA'' 
for consistency.
    In the second sentence of Sec.  206.191(e)(4)(i), FEMA states that 
if the agency was not successful in correcting the duplication, and 
FEMA is satisfied that the duplicating agency followed its remedial 
procedures, no further action will be taken. This is consistent with 
the current second sentence of Sec.  206.191(e)(4)(i), except for FEMA 
replacing ``the Regional Administrator'' with ``FEMA,'' as the RA is 
not involved.
    In the first sentence of Sec.  206.191(e)(4)(ii), FEMA states that 
if the duplicating agency did not follow its duplication of benefits 
procedures, or FEMA is not satisfied that the procedures were followed 
in an acceptable manner, then FEMA must provide an opportunity for the 
agency to take the required corrective action. This is consistent with 
the current first sentence of Sec.  206.191(e)(4)(ii), except for FEMA 
twice replacing ``the Regional Administrator'' with ``FEMA,'' as the RA 
is not involved and replacing ``shall'' with ``must'' for purposes of 
plain language.
    In the second sentence of Sec.  206.191(e)(4)(ii), FEMA states that 
if the agency cannot fulfill its responsibilities for remedial action, 
FEMA must notify the recipient of the excess assistance, and after 
examining the debt, then as appropriate, take those recovery actions in 
conjunction with agency representatives for each identified case in the 
random sample (or larger universe, at FEMA's discretion). This is 
consistent with the current second sentence of Sec.  206.191(e)(4)(ii), 
except for FEMA replacing ``the Regional Administrator'' with ``FEMA,'' 
as the RA is not involved; replacing ``shall'' with ``must'' for 
purposes of plain language; replacing ``if it is determined that the 
likelihood of collecting the debt and the best interests of the Federal 
Government justify taking the necessary recovery actions, then'' with 
``then as appropriate,'' and replacing ``the Regional Administrator's'' 
with ``FEMA's,'' as the RA's discretion is not involved.
    In the first sentence of Sec.  206.191(e)(5), FEMA states that when 
the random sample shows evidence that duplication has occurred and 
corrective action is required, FEMA must urge the duplicating agency to 
follow its own procedures to take corrective action, and must work with 
the agency toward that end. This is consistent with the current first 
sentence of Sec.  206.191(e)(5), except for FEMA replacing ``the 
Regional Administrator and the FCO'' with ``FEMA,'' as the RA and the 
FCO are not involved and replacing ``shall'' with ``must'' for purposes 
of plain language.
    In the second sentence of Sec.  206.191(e)(5), FEMA states that 
under its authority in the Stafford Act, 42 U.S.C. 5155, FEMA must 
require the duplicating agency to report to FEMA on the agency's 
attempt to correct the duplications identified in the sample. This is 
consistent with the current second sentence of Sec.  206.191(e)(5), 
except for FEMA replacing ``his/her'' with ``its;'' replacing ``section 
312'' with ``the Stafford Act, 42 U.S.C. 5155,'' for clarity and public 
ease of reference; replacing ``the Regional Administrator'' with 
``FEMA,'' as the RA is not involved in duplication of assistance when 
assistance under other authorities is involved; replacing ``shall'' 
with ``must'' for purposes of plain language; replacing ``him/her'' 
with ``FEMA;'' and replacing ``its'' with ``the agency's'' for clarity.
    In the first sentence of Sec.  206.191(f), FEMA states that funds 
due to FEMA are recovered in accordance with the Department of Homeland 
Security's Debt Collection Regulations (6 CFR part 11--Claims) and the 
Federal Claims Collection Standards (Department of the Treasury--
Department of Justice) (31 CFR chapter IX). This is consistent with the 
current first sentence of Sec.  206.191(f), except for FEMA adding the 
follow clause at the end of the sentence ``and the Federal Claims 
Collection Standards (Department of the Treasury--Department of 
Justice) (31 CFR chapter IX).'' FEMA is adding the additional cross 
reference as much of 44 CFR part 11 uses the joint Department of the 
Treasury (Treasury)/Department of Justice (DOJ) regulations and there 
are provisions in the Treasury/DOJ regulations that are not addressed 
in the DHS regulations.

[[Page 4051]]

    In the second sentence of Sec.  206.191(f), FEMA states that 
section 1216 of DRRA, 42 U.S.C. 5174a, also provides FEMA the authority 
to waive debts owed by individuals and households who received 
assistance under subpart D of part 206. FEMA is adding a new second 
sentence at Sec.  206.191(f) for clarity and transparency, since 
section 1216 of the DRRA directs FEMA to (1) waive debt owed by 
individuals and households who received assistance through the IHP 
where the assistance was distributed in error by FEMA; and (2) waive 
debt owed to the United States related to covered assistance that is 
subject to a claim or legal action, in accordance with section 317 of 
the Stafford Act, 42 U.S.C. 5160.\355\ Waiver is not permitted in 
either instance if the debt involves fraud, the presentation of a false 
claim, or misrepresentation by the debtor or any party having an 
interest in the claim.\356\ Due to passage of section 1216 of DRRA, 
FEMA updated its debt collection processes for Individual Assistance 
recipients.
---------------------------------------------------------------------------

    \355\ Disaster Recovery Reform Act of 2018, Public Law 115-254, 
132 Stat. 3449 (Oct. 5, 2018), as amended by the James M. Inhofe 
National Defense Authorization Act for Fiscal Year 2023, Public Law 
117-263, 136 Stat. 3404 (Dec. 23, 2022), 42 U.S.C. 5174.
    \356\ Id.
---------------------------------------------------------------------------

    In Sec.  206.191(g), FEMA adds a new paragraph heading of 
``Severability'' for consistency with standards established by the 
Federal Register. FEMA is adding a new paragraph (g) in Sec.  206.191 
stating any provision of Sec.  206.191 held to be invalid or 
unenforceable as applied to any person or circumstance should be 
construed so as to continue to give the maximum effect to the provision 
permitted by law, including as applied to persons not similarly 
situated or to dissimilar circumstances, unless such holding is that 
the provision of Sec.  206.191 is invalid and unenforceable in all 
circumstances, in which event the provision should be severable from 
the remainder of Sec.  206.191 and should not affect the remainder 
thereof.
    A severability clause is a standard legal provision. It indicates 
FEMA's intent that if a court finds that a specific provision of a rule 
is unlawful, the court should allow the remainder of the rule to 
survive. Those provisions that are unaffected by a legal ruling can be 
implemented by an agency without requiring a new round of rulemaking 
simply to promulgate provisions that are not subject to a court ruling.
    FEMA believes that its authority to implement the provisions of 
this IFR is well-supported in law and practice and should be upheld in 
any legal challenge. FEMA also believes that its exercise of its 
authority reflects sound policy. However, in the event that any portion 
of the IFR is declared invalid, FEMA intends that the various 
provisions be severable. The provisions are not so interconnected that 
the rule's efficacy depends on every one of them remaining in place--
implementation of the different provisions is sufficiently distinct 
that FEMA's aim of increasing equity and easing entry to the IA Program 
would still be furthered by maintaining the other provisions. For 
example, if a court were to find unlawful the change to the sequence of 
delivery in paragraph (d), the remaining provisions of the IFR, such as 
those on debt waiver in paragraph (f), could still function sensibly 
and FEMA would still intend them to stand.

V. Regulatory Analyses

A. Administrative Procedure Act

    The Administrative Procedure Act \357\ (APA) governs the process by 
which Federal agencies develop and issue regulations. Generally, when 
an agency promulgates legislative rules, the exercise of that authority 
is governed by the informal rulemaking procedures outlined in 5 U.S.C. 
553, which include publishing notices of proposed rulemaking and 
providing the opportunity for interested persons to submit 
comments.\358\ However, the APA provides an unqualified exemption for 
all rules relating to ``public property, loans, grants, benefits, or 
contracts'' (sometimes also referred to as the ``proprietary 
exemption'') from the procedural rulemaking requirements of Section 
553.\359\ The exemption includes ``all federally supported `subsidy 
programs' and `grants-in-aid programs under which the [F]ederal 
[G]overnment makes payment to [S]tate and local governments' as well as 
private individuals and entities.'' \360\ The exemption covers both 
narrow ``managerial'' proprietary decisions and broader proprietary 
``matters of interpretation and policy.'' \361\ The case law 
interpreting the requirement sets forth a relatively brief framework 
for analysis: namely, that the exempted subject matters are ``clearly 
and directly'' implicated in the rulemaking at issue.\362\
---------------------------------------------------------------------------

    \357\ 5 U.S.C. 551 et seq.
    \358\ See 5 U.S.C. 553(b) and (c).
    \359\ Id. Section 553(a)(2).
    \360\ Sierra Club v. Atlanta Reg'l Comm'n, 255 F. Supp. 2d 1319 
(GA N.D. 2002) (citing STEIN, MITCHELL & MEZINES, ADMINISTRATIVE LAW 
Sec.  1502[4][e] (quoting ATTORNEY GENERAL'S MANUAL ON THE APA 27-28 
(1947)).
    \361\ Alphapointe v. Dep't of Veterans Affairs, 416 F. Supp. 3d 
(D.D.C. 2019) (quoting Nat'l Wildlife Fed'n v. Snow, 561 F.2d 227, 
231-32 (D.C. Cir. 1976)).
    \362\ Humana of S.C., Inc. v. Califano, 191 U.S. App. D.C. 368, 
590 F.2d 1070, 1082 (1978) (That the governmental function is not 
strictly ``proprietary,'' or the regulation's character is not 
``mechanical,'' does not curtail Section 553(a)(2)'s permissive 
effect. Public policy may be sorely affected, and the wisdom of 
public input manifest, but the statutory exemption still prevails 
when ``grants,'' ``benefits,'' or other named subjects are ``clearly 
and directly'' implicated.)
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    As described more fully in the background section, supra, this IFR 
is clearly and directly related to a grant program, the IHP, which 
authorizes FEMA to provide financial assistance and direct services to 
individuals and households who, as a direct result of a major disaster, 
have necessary expenses and serious needs in cases in which the 
individuals and households are unable to meet such expenses or needs 
through other means.\363\ As such, this rule is exempt from the APA's 
notice and comment requirement.
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    \363\ 42 U.S.C. 5174.
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    However, FEMA did not end its analysis here. FEMA's regulations on 
rulemaking provide that its general policy is to provide for public 
participation in rulemaking despite the APA exemption unless it 
determines that circumstances warrant a departure from that general 
policy.\364\ FEMA identified specific circumstances which warrant such 
a departure, such as for its annual grant programs which are subject to 
annual appropriations and potential revisions to their requirements, 
and more general circumstances, such as situations in which it requires 
flexibility to adapt quickly to legal and policy mandates. FEMA 
retained its general policy in favor of public participation in 
rulemaking.
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    \364\ 44 CFR 1.3(a) and (c). Until recently, FEMA waived the 
exemption afforded to grant programs under the APA and treated its 
programs as if they were subject to traditional notice and comment 
requirements. On March 3, 2022, FEMA published a final rule 
clarifying its position regarding notice and comment rulemaking for 
its grant programs. See 87 FR 11971, Mar. 3, 2022. FEMA determined 
that removal of the waiver of the exemption streamlined the 
regulations and ensured that the agency retained the flexibility to 
utilize a range of public engagement options in advance of 
rulemaking where appropriate. FEMA noted that it would retain its 
general policy in favor of public participation in rulemaking but 
would retain discretion to depart from this policy as circumstances 
warrant.
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    In light of the increasing climate-related disasters facing the 
Nation, it is vital to implement these program improvements now to 
ensure IHP meets the increasing need for assistance to individuals and 
families recovering from disasters. Some impacts of climate change are 
already being felt as extreme weather events have increased in

[[Page 4052]]

intensity as well as frequency,\365\ and those impacts will worsen as 
climate change intensifies in the future.\366\ Such impacts have 
elevated the need for IHP assistance and will continue to require 
greater efficiency in the delivery of disaster services, particularly 
for disadvantaged communities, which are disproportionately 
impacted.\367\ This rule increases equity by simplifying processes, 
removing barriers to entry, and increasing eligibility for certain 
types of assistance under the program.
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    \365\ See Economic Report of the President at 275 (March 2023), 
https://www.whitehouse.gov/wp-content/uploads/2023/03/ERP-2023.pdf.
    \366\ See CRS Rep. 46694, Climate Change Adaptation: Department 
of the Interior, at 1 (2021), available at https://crsreports.congress.gov/product/pdf/R/R46694; Maldonado, J., Wang, 
I.F.C., Eningowuk, F. et al. Addressing the challenges of climate-
driven, community-led resettlement and site expansion: knowledge 
sharing, storytelling, healing, and collaborative coalition 
building. J. Environ. Stud. Sci. 11, 294-304 (2021). https://doi.org/10.1007/s13412-021-00695-0.
    \367\ See, e.g., EPA, Climate Change and Social Vulnerability in 
the United States: A Focus on Six Impacts (September 2021), https://www.epa.gov/cira/social-vulnerability-report.
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    FEMA has balanced the need for flexibility to adapt quickly to 
legal and policy mandates with its general policy favoring public 
participation in rulemaking. FEMA sought input on regulatory changes to 
the IHP through an RFI, published on April 22, 2021, seeking public 
input on its programs, regulations, collections of information, and 
policies to ensure they effectively achieve FEMA's mission in a manner 
that furthers the goals of advancing equity for all, including those in 
underserved communities; bolstering resilience from the impacts of 
climate change, particularly for those disproportionately impacted by 
climate change; and environmental justice.\368\ FEMA held public 
meetings and extended the comment period on the RFI to ensure all 
interested parties had sufficient opportunity to provide comments.\369\ 
Commenters raised equitable concerns that FEMA addressed in this IFR, 
such as removing the requirement to apply for the SBA for a loan fore 
receipt of ONA, amending FEMA's habitability standards, increasing 
assistance for essential tools, simplifying its appeal process, and 
removing documentation requirements for late registrations.
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    \368\ 86 FR 21325, Apr. 22, 2021.
    \369\ See ``Request for Information on FEMA Programs, 
Regulations, and Policies; Public Meetings; Extension of Comment 
Period,'' 86 FR 30326, June 7, 2021.
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    FEMA has determined, in its discretion,\370\ that these 
circumstances warrant publishing this as an interim final rule, but 
FEMA is seeking public comment on this rule and will carefully consider 
each comment received to determine whether further changes to FEMA's 
IHP regulations are needed.
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    \370\ 42 U.S.C. 5148.
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B. Executive Order 12866, Regulatory Planning and Review, as Amended by 
Executive Order 14094, Modernizing Regulatory Review; Executive Order 
13563, Improving Regulation and Regulatory Review

    Executive Orders 12866 (Regulatory Planning and Review), as amended 
by Executive Order 14094 (Modernizing Regulatory Review), and 13563 
(Improving Regulation and Regulatory Review) direct agencies to assess 
the costs and benefits of available regulatory alternatives and, if 
regulation is necessary, to select regulatory approaches that maximize 
net benefits (including potential economic, environmental, public 
health and safety effects, distributive impacts, and equity). Executive 
Order 13563 emphasizes the importance of quantifying both costs and 
benefits, of reducing costs, of harmonizing rules, and of promoting 
flexibility. OMB has designated this rule as a ``significant regulatory 
action'' as defined under section 3(f)(1) of Executive Order 12866, as 
amended by Executive Order 14094 because its annual effects on the 
economy exceed $200 million in any year of the analysis. Accordingly, 
OMB has reviewed it.
    This Regulatory Impact Analysis (RIA) provides an assessment of the 
potential costs, benefits, and transfer payments from this rule under 
the criteria of Executive Orders 12866 and 13563. This analysis does 
not attempt to replicate the regulatory language of the rule or any 
other supporting documentation. FEMA urges the reader to review the 
rest of this rule in addition to reviewing this analysis. The complete 
RIA is available in the Docket. The following analysis is a summary of 
the information contained in the IA Equity RIA document.
    FEMA publishes this IFR amending its regulations governing the 
Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program. Specifically, the IFR 
increases eligibility for home repair assistance by amending the 
definitions and application of the terms safe, sanitary, and 
functional, allowing assistance for certain accessibility-related 
items, and amending its approach to evaluating insurance proceeds; 
allows for the re-opening of the applicant registration period when the 
President adds new counties to the major disaster declaration; 
simplifies the documentation requirements for continued temporary 
housing assistance; simplifies the appeals process; simplifies the 
process to request approval for a late registration; removes the 
requirement to apply for a Small Business Administration loan as a 
condition of eligibility for ONA; and establishes additional eligible 
assistance under ONA for serious needs, displacement, disaster-damaged 
computing devices and essential tools for self-employed individuals. 
FEMA also makes to reflect changes to statutory authority that have not 
yet been implemented in regulation, to include provisions for utility 
and security deposit payments, lease and repair of multifamily rental 
housing, child care assistance, maximum assistance limits, and waiver 
authority. FEMA is also making several technical changes, codification 
of existing policy and practice, and non-substantive clarifications to 
its IA regulations. These changes are addressed in the Marginal 
Analysis Table that can be found in this document.

[[Page 4053]]

Table 7--Summary of the Impacts of the Changes, No-Action Baseline 
(2020$)
[GRAPHIC] [TIFF OMITTED] TR22JA24.006

1. Need for Regulation
    FEMA provides financial assistance under the HA and ONA provisions 
of the IHP to eligible individuals and households who have uninsured or 
underinsured necessary expenses and serious needs. In alignment with 
Executive Order 13985 on ``Advancing Racial Equity and Support for 
Underserved Communities Through the Federal Government'' and Executive 
Order 14091, ``Further Advancing Racial Equity and Support for 
Underserved Communities Through the Federal Government.'' and in 
response to comments received during the Agency's Request for 
Information to receive input from the public on FEMA programs, 
regulations, and collections of information, FEMA is updating its IHP 
regulations. FEMA makes these changes to simplify the IHP, promote more 
equitable access to disaster assistance, and to reflect changes made to 
statutory authority. These changes will remove administrative burdens, 
improve overall timeliness, and utilize program and policy discretion 
to reduce barriers.
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    \371\ Post-Katrina Emergency Management Reform Act of 2006 
(PKEMRA).
    \372\ Sandy Recovery Improvement Act of 2013 (SRIA).
    \373\ Disaster Recovery Reform Act of 2018 (DRRA).
    \374\ The term ``recipients'' used throughout this document 
refers to individuals and households that apply for IHP assistance 
and receive assistance from FEMA.
    \375\ FEMA defines the term ``State'' to mean for the purposes 
of Subpart D of 44 CFR 206 and where consistent with the 
requirements of the Stafford Act, any State of the United States, 
the District of Columbia, Puerto Rico, the Virgin Islands, Guam, 
American Samoa, and the Commonwealth of the Northern Mariana Islands 
or Indian tribal government as defined in the Stafford Act (42 
U.S.C. 5122(6)).
    \376\ The term ``applicants'' used throughout this document 
refers to individuals and households that apply for IHP assistance.
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    FEMA makes the following changes to increase equity and ease of 
entry to IHP:
    1. Revise IHP eligibility determinations based on insurance 
proceeds to help with unmet needs;

[[Page 4054]]

    2. Expand application of habitability ``safe, sanitary, and 
functioning'' for IHP to include pre-existing damage;
    3. Amend CTHA process and timeline in which applicants provide 
permanent housing plan documents. Also, codify CTHA income threshold of 
30 percent of applicant's post-disaster income towards their post-
disaster housing costs;
    4. Remove the requirement to apply for an SBA loan prior to receipt 
of certain types of ONA;
    5. Establish Serious Needs Assistance ONA;
    6. Establish Displacement Assistance ONA;
    7. Simplify IA appeals process;
    8. Amend IA registration to allow for the reopening of the 
registration period
    9. Amend IA late registration to accept verbal explanations for 
applicant requests;
    10. Expand Personal Property Assistance ONA eligibility for 
computing devices;
    11. Expand Personal Property Assistance ONA eligibility for self-
employed essential tools;
    12. Expand Home Repair Assistance to include accessibility-related 
items for applicants who have a disability but had unmet pre-disaster 
accessibility needs;
    13. Codify Home Repair Assistance to include accessibility-related 
items for survivors with disaster-related disabilities;
    14. Codify Home Repair Assistance for professional assessments; and
    15. Codify requirements waiver of certain IHP debt.
    Additionally, to support eligible applicants' ability to respond to 
and recover from major disasters and emergencies, Congress passed 
PKEMRA, SRIA, and DRRA. This rule will incorporate certain changes 
identified in those acts into regulation including assistance for 
Security Deposits and Utilities (PKEMRA), Child Care Assistance (SRIA), 
Lease and Repair of Multifamily Rental Housing (SRIA), and Maximum 
Amount of Assistance (DRRA).
2. Affected Population
    The IHP provides financial assistance and direct services to 
eligible individuals and households who have uninsured or underinsured 
necessary expenses and serious needs as a result of a Presidentially-
declared disaster. From 2010 to 2019, the average number of IHP 
recipients was 340,654 per year.\377\
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    \377\ Data pulled from Enterprise Data Warehouse (EDW) was used 
to calculate the historical IHP average number of recipients for 
2010-2019.
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3. Baseline
    Following OMB Circular A-4 guidance, FEMA assessed impacts of this 
rule against a no-action baseline and pre-guidance baseline. The no-
action baseline is what the world will look like without this rule. 
Accordingly, measuring the rule against a no-action baseline shows the 
effects of the rule as compared to current FEMA practice (i.e., 
compared to IA Guidance, which reflects FEMA's current practice). A 
pre-guidance baseline is what the world will look like without the 
enabling statute or guidance that FEMA issued to implement it. 
Accordingly, measuring the rule against a pre-guidance baseline shows 
the effects of the rule as compared to FEMA practice prior to enactment 
of the enabling statute or guidance (i.e., as if FEMA had not already 
implemented the statutory or policy changes through the IAPPG).
    FEMA conducted a 10-year retrospective analysis of available IA 
Program data from 2010-2019, the most recent representative disaster 
period with complete data at the time of this analysis, to estimate how 
the rule will impact major disaster declarations costs, benefits, and 
transfers over a 10-year period.\378\ FEMA recognizes a future 10-year 
period could vary from the 2010-2019 period. However, this is the best 
estimate given the data available and the unpredictability of the 
number, size, and cost of future IA awards.
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    \378\ FEMA considered 2010-2019 the most representative analysis 
period when selecting the data and time-period for estimating 
impacts of this rule into the future. At the time of this analysis, 
in early 2021, data from 2020 was available but not used for this 
analysis as Covid data posed more bias and uncertainty risks than 
value when estimating future impacts.
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4. Transfer Payments
    Transfer payments are monetary payments from one group to another 
that do not affect the total resources available to society. The 
assistance FEMA provides to recipients through IHP grants are 
considered transfer payments because these are monetary payments from 
FEMA and States to individuals and households for their purchase of 
goods and services. In this analysis, FEMA has analyzed the impact of 
this rule on these transfer payments.
No-Action Baseline
    The rule under a no-action baseline will result in additional 
transfer payments due to the following changes for: Insurance Proceeds, 
Habitability, Removing SBA Requirement for ONA, Serious Needs 
Assistance, Displacement Assistance, Appeals Process, Reopening 
Registration Period, Personal Property Assistance (PPA) Computing 
Devices, PPA Self-Employed, and Home Repair for Accessibility-Related 
Items for Per-Disaster Unmet Needs. Other changes, such as providing 
reimbursement for a professional assessment for unclear damage and 
providing child care assistance, were changed by statute and have been 
already implemented by FEMA through IA Guidance. Because FEMA has 
already implemented these policies and codifies them without change, 
the codification of these policies will not impact transfer payments 
under the no-action baseline. Additionally, the late registration 
change of accepting verbal explanations for late registration requests 
is not expected to impact transfer payments.
    Under a no-action baseline, the rule increases assistance provided 
from FEMA and States to individuals and households by an estimated $672 
million per year. Specifically, FEMA's transfer payments increase by 
$512 million per year and State transfer payments, due to State ONA 
cost share, increases $160 million per year. The three largest changes 
(removing SBA requirement of ONA, Serious Needs Assistance, and 
Displacement Assistance) account for approximately 87 percent of the 
increase in transfer payments and detailed summaries of these impact 
are provided below measured against the no-action baseline.
    FEMA's change removing the SBA loan application requirement prior 
to receipt of certain types of ONA accounts for more than 20 percent of 
the transfer payment increase, estimated at $155,551,150 (FEMA 
$116,663,362 + State $38,887,788) per year. Currently, applicants 
seeking certain types of IHP ONA must first apply and be denied for an 
SBA disaster loan. Through this process, applicants who qualify for an 
SBA loan are ineligible to receive certain types of ONA. Unlike ONA, 
which is a grant that does not need to be repaid, an SBA loan accrues 
interest and must be repaid. SBA-dependent ONA includes three types of 
assistance Personal Property assistance, Transportation assistance, and 
GFIP.\379\ FEMA estimates that, from 2010-2019, approximately 45 
percent of SBA-dependent ONA applicants received SBA-dependent ONA; 
these applicants either did not meet the income threshold to be 
referred to the SBA to apply for a loan or applied for a loan and were 
denied. This rule will remove the requirement that applicants apply for 
an SBA loan before becoming

[[Page 4055]]

eligible for ONA; however, applicants may still choose to apply for an 
SBA loan to assist with their recovery.
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    \379\ See page 150, SBA-dependent ONA, of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
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    FEMA used ONA recipient data from EDW for 2010 through 2019 to 
establish a no-action baseline. From 2010 to 2019, an average of 
174,693 recipients received ONA annually and the average award was 
$1,455. FEMA awarded $254,178,315 (= 174,693 x $1,455) of ONA on 
average annually. Accordingly, FEMA estimates that under a no-action 
baseline, 174,693 recipients will receive ONA annually and ONA 
assistance will total $254,178,315 per year. FEMA uses these amounts 
against which to measure the change to remove the SBA requirement for 
ONA.
    FEMA used the three types of SBA-dependent ONA assistance (Personal 
Property assistance, Transportation assistance, and GFIP) historical 
ONA data to estimate the impact to households and individuals of the 
changes to eliminate the requirement to apply for an SBA loan prior to 
receipt of ONA. From 2010 to 2019, an average of 174,693 recipients 
received ONA annually. Based on FVL damages collected from ONA 
applicants 2010 through 2019, FEMA estimates the number applicants 
previously ineligible for ONA under Personal Property Assistance and 
Transportation Assistance with disaster damage was 574,899 referred 
applicants, or 57,490 applicants per year. These applicants previously 
would have either received an SBA loan or been eligible but chose not 
to receive a loan. FEMA estimates that, after removing the SBA 
application requirement, these 57,490 applicants currently ineligible 
for SBA-dependent ONA will receive the average ONA amount of $1,455 
resulting in additional assistance of $83,647,950 (= 57,490 x $1,455) 
per year. The ONA average award amount of $1,455 was used for these 
applicants because Personal Property Assistance and Transportation 
Assistance are the most frequent types of SBA-ONA assistance and 
represents the average recipient award amount. Additionally, from 2010 
through 2019 there were 422,958 referred ONA ineligible applicants, or 
42,296 per year, with flood damage within a flood zone. Applicants 
located in Special Flood Hazard Areas, who receive disaster assistance 
after a flooding event, are required to buy and keep flood insurance on 
their property. As part of ONA, FEMA will provide GFIP for eligible 
applicants. FEMA estimates that, after removing the SBA application 
requirement, these 42,296 applicants currently ineligible for SBA-
dependent ONA will receive the average GFIP amount of $1,700 resulting 
in additional assistance of $71,903,200 (42,296 x $1,700) per year in 
the future. The $1,700 specific GFIP average amount was used for these 
applicants because FEMA was able to identify those in a flood zone and 
GFIP would be in addition to any other SBA-dependent ONA amounts.
    FEMA's primary impact estimate of this change is an additional 
$155,551,150 (= $83,647,950 + $71,903,200) in ONA awards annually. ONA 
is a cost-shared program between FEMA and the affected State, where the 
State typically covers 25 percent of ONA award and FEMA covers 75 
percent. State's transfer payments for the additional ONA will be 
$38,887,788 per year (= $155,551,150 x 25 percent) and FEMA's transfer 
payments will be $116,663,362 per year (= $155,551,150 x 75 percent).
    FEMA will establish Displacement Assistance under ONA that will 
provide assistance to eligible survivors whose homes are uninhabitable. 
FEMA expects Displacement Assistance will be a payment per recipient to 
cover 14 nights of lodging in most cases. Displacement Assistance will 
become a preceding step before requesting initial Rental Assistance and 
those receiving Displacement Assistance will be ineligible for LER 
Assistance.
    Currently there are two primary types of assistance for displaced 
survivors: LER Assistance and initial Rental Assistance. FEMA used LER 
and initial Rental Assistance data from EDW for 2010 through 2019 to 
estimate the baseline for this change. FEMA estimates a no-action 
baseline of 142,273 recipients who receive LER or Rental Assistance (= 
2,367 LER recipients + 139,906 Initial Rental Assistance recipients) 
and approved assistance in the amount of $315,987,647 (= $3,017,925 + 
$312,969,722) per year. Displacement Assistance will be a new type of 
assistance established through this rule; recipients will be ineligible 
for LER assistance.
    To estimate the impact that establishing Displacement Assistance 
will have on transfer payments, FEMA used the State standard U.S. 
General Services Administration (GSA) lodging rates in conjunction with 
initial Rental Assistance data. Initial Rental Assistance data from 
2010-2019 provided the recipient count for each State. FEMA assumes 
that individuals who received Initial Rental Assistance will meet the 
criteria to receive newly established Displacement Assistance. 
Additionally, FEMA used IHP data 2010-2019 to estimate that an average 
of 67,075 individuals per year were displaced due to housing damage but 
were unwilling to relocate. These individuals unwilling to relocate 
were ineligible for Rental Assistance but will be eligible for 
Displacement Assistance. Because the amount in Displacement Assistance 
will vary by State according to GSA lodging rates, FEMA needed 
recipient counts by State in order to estimate the amount in 
Displacement Assistance that FEMA might provide. FEMA multiplied the 
number of recipients per State by the GSA lodging rate for each State 
to calculate a per State total. Next, FEMA summed the State totals to 
create a national total. Finally, FEMA divided the national total by 
the total number of Initial Rental Assistance recipients to estimate an 
average per recipient Displacement Assistance amount of $1,369 (= 
$283,356,989 average annual amount / 206,981 (139,906 Rental + 67,075 
unwilling to relocate) average number of Initial Rental Assistance 
recipients and those unwilling to relocate). FEMA used the estimated 
the average Displacement Assistance amount per recipient of $1,369 
multiplied by the average number of recipients for LER and initial 
Rental Assistance 209,348 (= 2,367 + 206,981) per year to estimate the 
average annual amount of Displacement Assistance at $286,597,412 (= 
$1,369 x 209,348). FEMA anticipates LER for displaced applicants with 
disaster-damage to their home will fall to near zero based on the 
sequence of assistance delivery for Displacement Assistance (i.e., it 
could be paid out quicker), and those receiving Displacement Assistance 
will be ineligible for LER. FEMA's primary estimate assumes the 
assistance FEMA currently provides through LER to be zero in the future 
and initial Rental Assistance will decline by 20 percent from the 
current 10-year average totaling $250,375,778 ($312,969,722 x (1-20 
percent)) per year. Accordingly, FEMA estimates the change will cause 
assistance for Displacement Assistance, LER, and initial Rental 
Assistance to increase to $536,973,190 (= $286,597,412 Displacement + 
$0 LER + $250,375,778 Rental) per year.
    The estimated annual transfer payments from FEMA and States to 
recipients (individuals/households) for the new Displacement Assistance 
ONA increases assistance by $220,985,543 (= $536,973,190-$315,987,647 
baseline) per year. ONA is a cost-shared program between FEMA and the 
affected State, where the State typically covers 25 percent of ONA 
award and FEMA covers 75 percent. States' transfer payments for 
Displacement Assistance ONA will be $55,246,386 (=

[[Page 4056]]

$220,985,543 x 25 percent) per year and FEMA's transfer payments will 
be $165,739,157 (= $220,985,543 x 75 percent) per year.
    FEMA is also creating Serious Needs Assistance to provide 
assistance in an amount established by FEMA to eligible survivors to 
address immediate needs related to sheltering, evacuation, or other 
emergency disaster expenses. Serious Needs Assistance will be more 
widely available to survivors than CNA as Serious Needs Assistance will 
not require an additional State request and FEMA approval, unlike CNA. 
Serious Needs Assistance will take the place of CNA. FEMA used CNA data 
from EDW for 2015 through 2019 to estimate the baseline and impact for 
this change due to more frequent CNA usage during this period. Prior to 
2015, CNA was rarely used with most years having zero CNA 
recipients.\380\ An average of 185,937 recipients received CNA per year 
at an average amount of $528. FEMA estimates a no-action baseline of 
185,937 recipients who receive CNA and assistance provided of 
$98,174,736 (= 185,937 x $528) per year.
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    \380\ Limited CNA usage prior to 2015 may have been due to the 
requirements for requesting and justifying CNA and a lack of State 
familiarization with this assistance.
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    FEMA used IHP applicant data from EDW for 2015 through 2019 to 
estimate the impact that replacing CNA with the new, broader, Serious 
Needs Assistance will have on transfer payments. FEMA's change to 
Serious Needs Assistance will standardize eligibility within the 
declaration area based on the applicant's location being out of the 
pre-disaster home or that they report they have other emergency 
disaster expenses.\381\ FEMA applied this new Serious Needs Assistance 
eligibility to all IHP applicant data from 2015 through 2019 
(regardless if CNA was activated by the State or not) to identify 
applicants that will receive Serious Needs Assistance under the new 
policy. FEMA estimates 410,807 applicants per year will meet 
eligibility and receive Serious Needs Assistance. FEMA believes $750 is 
the most appropriate amount to cover immediate post-disaster serious 
needs based on prior experience with CNA. Accordingly, FEMA estimates 
Serious Needs Assistance will be $308,105,250 (= 410,807 x $750) per 
year.
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    \381\ Currently CNA must be requested with a justification from 
the State for each disaster. FEMA has also often waived certain 
eligibility criteria or only approved assistance in certain 
counties, parishes, or municipalities.
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    FEMA estimates that the new Serious Needs Assistance ONA increases 
annual transfer payments from FEMA and States to recipients 
(individuals/households) by $209,930,514, for a total of $308,105,250 
in Serious Needs Assistance per year (from a baseline of $98,174,736 in 
CNA per year). ONA is cost-shared between FEMA and the affected State. 
The State typically covers 25 percent of the ONA award and FEMA covers 
75 percent. The States' portion of the additional assistance provided 
under Serious Needs Assistance ONA will be $52,482,628 (= $209,930,514 
x 25 percent) per year and FEMA's portion will be $157,447,886 (= 
$209,930,514 x 75 percent) per year.
    FEMA will expand Personal Property Assistance so that a household 
may receive financial assistance for a disaster-damaged computing 
device, regardless of its intended use. While FEMA had previously 
provided assistance for damaged computers, it was limited to those 
computers that were required for educational purposes or as a condition 
of employment. FEMA recognizes that technology continues to have an 
increasing role in how households communicate, manage finances, and 
facilitate many other necessary aspects of daily living. FEMA used 
2010-2019 Personal Property ONA data to estimate the impact of the 
changes. FEMA estimated the number of additional recipients based on 
the average number of recipients with Personal Property awards 2010-
2019 and the assistance estimated award amount for a computing device 
of $900. To estimate the number of additional recipients, FEMA used the 
average annual number of Personal Property Assistance recipients of 
53,131 because recipients of Personal Property Assistance sustained 
damage to personal property and FEMA assumed all such recipients will 
be eligible for assistance to replace one computer. FEMA estimates that 
the annual impact of the change will be an additional $47,817,900 (= 
53,131 x $900) in assistance. ONA is a cost-shared program between FEMA 
and the affected State, where the State typically covers 25 percent of 
ONA award and FEMA covers 75 percent. States' portion of the new 
Personal Property Assistance ONA will be $11,954,475 (= $47,817,900 x 
25 percent) and FEMA's portion will be $35,863,425 (= $47,817,900 x 75 
percent).
    In Table 8 below, FEMA presents the total change in transfer 
payments from the rule as measured against a no-action baseline (i.e., 
the effects of the rule as compared to current FEMA practice). FEMA 
estimates that this rule, as measured against a no-action baseline, 
will result in an additional $6.72 billion in transfer payments from 
FEMA and States to individuals and households over 10-years. The total 
10-year discounted transfer payments will be $5.73 billion at a 3 
percent discount rate and $4.72 billion at a 7 percent discount rate; 
this is $672 million annualized at a 3 percent and 7 percent discount 
rate (Table 8).

[[Page 4057]]

[GRAPHIC] [TIFF OMITTED] TR22JA24.007

Pre-Guidance Baseline
    The rule under a pre-guidance baseline will result in additional 
transfer payments due to the following changes (mirroring the no-action 
baseline changes) that FEMA makes through this rule: Insurance 
Proceeds, Habitability, Removing SBA Requirement for ONA, Serious Needs 
Assistance, Displacement Assistance, Appeals Process, Reopening 
Registration Period, Personal Property Assistance (PPA) Computing 
Devices, PPA Self-Employed, and Home Repair for Accessibility-Relates 
Items for Per-Disaster Unmet Needs. FEMA also codifies a number of 
changes that FEMA has previously implemented through guidance. FEMA has 
measured the impact of these changes on transfer payments against the 
pre-guidance baseline. These are for changes to: CHTA, Professional 
Assessment for Unclear Damage, Debt Waiver, MLR, Assistance for Child 
Care, Assistance for Security Deposit Payments, Assistance for Utility 
Payments, Temporary Housing (TH) Maximum Cap Removal, and HA and ONA 
Maximum Cap Separation.
    In Table 9 below, FEMA presents the total change in transfer 
payments from the rule as measured against a pre-guidance baseline 
(i.e., the effects of the rule as compared to FEMA practice prior to 
implementing statutory changes). Under a pre-guidance baseline, the 
changes that FEMA has already implemented and codifies the new changes 
FEMA implements through this rule increases assistance provided from 
FEMA and States to individuals and households estimated at $711 million 
per year over the next 10 years. Specifically, FEMA's transfer payments 
will be $551 million per year and State transfer payments due to the 
State ONA cost share will be $160 million per year.
    Under a pre-guidance baseline, FEMA's three largest changes 
(removing SBA requirement of ONA, Serious Needs Assistance, and 
Displacement Assistance) account for approximately more than 80 percent 
of the increase in transfer payments estimated at $587 million (FEMA 
transfer payments $440 million + State transfer payments $147 million) 
per year.
    FEMA estimates the 10-year undiscounted transfer payments of the 
rule measured against a pre-guidance baseline will be $7.11 billion. 
The total 10-year discounted transfer payments will be $6.06 billion at 
a 3 percent discount rate and $4.99 billion at a 7 percent discount 
rate, with annualized transfers of $711 million at a 3 percent and 7 
percent discount rate (Table 9).

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5. Costs
No-Action Baseline
    In Table 10 below, FEMA presents the total costs of the rule as 
measured against a no-action baseline (i.e., the effects of the rule as 
compared to current FEMA practice) over the next 10 years. The rule, 
under a no-action baseline, will result in additional costs to States, 
FEMA, and applicants. States will have additional costs due to 
familiarization with the rule in the first year only estimated at 
$41,816. FEMA expects to incur costs for implementing system updates 
related to the changes in this rule in the first two years estimated to 
be $4.3 million per year. Additionally, FEMA expects to incur costs for 
reviewing additional documentation submitted by applicants. FEMA 
anticipates that applicants will submit additional documents to FEMA as 
a result of the following changes in this rule: (1) removing the 
requirement to first apply for a Small Business Administration (SBA) 
loan before receipt of certain types of ONA ($578,934), (2) FEMA 
exercising its option to reopen a registration period ($991), and (3) 
expanded assistance for accessibility-related items ($13,122). FEMA 
estimates a total of $593,047 per year in additional documentation 
review costs to FEMA.
    Applicants will have additional costs due to increased burden hours 
for submitting documentation to FEMA related to these same changes: 
removal of the SBA application requirement ($334,300), registration 
period reopening ($830), and application for accessibility-related 
items ($10,982). FEMA estimates applicants burden hour costs increases 
by a total of $346,112 per year.
    FEMA estimates total costs, to FEMA, States, and applicants, at 
$5,280,975 (= $41,816 + $4,300,000 + $593,047 + $346,112) in the first 
year, $5,239,159 (= $4,300,000 + $593,047 + $346,112) in the second 
year, and $939,159 (= $593,047 + $346,112) in subsequent years.
    FEMA estimates the 10-year undiscounted costs of the rule will be 
$18.0 million over the next 10 years as measured against a no-action 
baseline. The total 10-year discounted costs will be $16.3 million at a 
3 percent discount rate and $14.4 million at a 7 percent discount rate, 
with annualized costs of $1.9 million at a 3 percent and $2.1 million 
at a 7 percent discount rate (Table 10).

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Pre-Guidance Baseline
    In Table 11 below, FEMA presents the total costs of the rule over 
the future 10-year period as measured against a pre-guidance baseline 
(i.e., the effects of the rule as compared to FEMA practice prior to 
implementing the statutory changes). The rule, under a pre-guidance 
baseline, will result in additional costs to States, FEMA, and 
applicants. States will have additional costs due to familiarization 
with the rule in the first year only estimated at $41,816. FEMA expects 
to incur costs for implementing system updates related to the changes 
in this rule in the first two years estimated to be $4.3 million per 
year. The rule also increases costs for FEMA due to (1) reviewing 
additional applicant submitted documentation for the SBA requirement 
removal ($578,934), (2) debt waiver ($460), (3) child care ($708), (4) 
registration period reopening ($991), and (5) accessibility-related 
items ($13,122), which total an estimated $594,215 per year measured 
against a pre-guidance baseline.
    Applicants will have additional costs due to increased burden hours 
for submitting documentation related to the same changes: (1) SBA 
requirement removal ($334,300), (2) debt waiver ($385), (3) child care 
assistance ($593), (4) registration period reopening ($830), and (5) 
applicants with a disability applying for accessibility-related items 
($10,982). FEMA estimates the total cost to applicants for the new 
changes in this rule and the changes FEMA has already implemented and 
codifies is $347,090 per year measured against a pre-guidance baseline. 
FEMA estimates costs, before cost saving, at $5,283,121 (= $41,816 + 
$4,300,000 + $594,215 + $347,090) in the first year, $5,241,305 (= 
$4,300,000 + $594,215 + $347,090) in the second year, and $572,190 (= 
$594,215 + $347,090) in subsequent years.
    FEMA estimates the 10-year undiscounted costs of the rule will be 
$18.1 million measured against a pre-guidance baseline. The total 10-
year discounted costs will be $16.3 million at a 3 percent discount 
rate and $14.4 million at a 7 percent discount rate, with annualized 
costs of $1.9 million at a 3 percent and $2.1 million at a 7 percent 
discount rate (Table 11).

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6. Cost Savings
    The rule, under a no-action and pre-guidance baseline, will also 
reduce burden costs for applicants by removing the SBA loan application 
requirement prior to certain FEMA assistance and lowering the expected 
number of applicants spending time completing loan applications 
($2,029,273), submitting CTHA streamlined incremental documentation 
($870,862), the more flexible appeals process documentation ($861,338), 
and the simplified option for verbal explanations of late registration 
requests ($207,727) resulting in cost savings estimated at $1,939,927 
per year. FEMA will also have cost savings related to CTHA 
documentation review ($7,220) and late registration review ($173,928) 
estimated at $181,148 per year. Additionally, SBA will have cost 
savings because fewer loan applications will be submitted and reviewed 
by SBA staff resulting in savings estimated at $3,877,763 per year. The 
combined Federal Government cost savings are estimated at $4,058,911 
(FEMA $181,148 + SBA $3,877,763).
    FEMA estimates the 10-year undiscounted cost savings of the will be 
$80.3 million. The total 10-year discounted cost savings will be $68.5 
million at a 3 percent discount rate and $56.4 million at a 7 percent 
discount rate, with annualized cost savings of $8.0 million at a 3 
percent and 7 percent discount rate (Table 12).

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7. Total Net Costs
    FEMA estimates net cost savings under a no-action baseline at $2.7 
million (= $5,280,975 costs-$8,028,111 cost savings) in the first year, 
$2.8 million (= $5,239,159 costs-$8,028,111 cost savings) in the second 
year, and $7.1 million (= $980,975 costs-$8,028,111 cost savings) in 
subsequent years for this rule.
    FEMA estimates net cost savings under a pre-guidance baseline at 
$2.7 million (= $5,283,121 costs-$8,028,111 cost savings) in the first 
year, $2.8 million (= $5,241,305 costs-$8,028,111 cost savings) in the 
second year, and $7.1 million (= $941,305 costs-$8,028,111 cost 
savings) in subsequent years for this rule.
8. Benefits
    FEMA was unable to quantify benefits of this rule because data does 
not explicitly exist for the types of benefits incurred. All benefits 
associated with the rule will be qualitative. FEMA anticipates this 
rule will promote more equitable access to disaster assistance by 
reducing applicant barriers, improving overall timeliness, and removing 
administrative burdens for disaster survivors. These benefits are 
expected to be broad based impacting disaster survivors applying for 
IHP assistance types covered in this rule. Ultimately, the rule will 
lead to a larger pool of eligible disaster survivors receiving disaster 
assistance funds than had in the past. The rule will also improve 
clarity and align FEMA regulations with statutory changes improving the 
efficiency and consistency of IHP assistance. The intent is that these 
changes will lead to improved recovery outcomes for applicant survivors 
with an emphasis on vulnerable populations.
No-Action Baseline
    The following is an overview of equity (consistent, systematic 
fair, just, and impartial treatment of all) benefits under a no-action 
baseline for changes of this rule.
    FEMA's change removing the requirement for applicants to apply for 
SBA loans prior to receipt of ONA will alleviate survivor 
administrative burden and help streamline recovery. FEMA used EDW 
applicant data for the FEMA to SBA referral date and SBA to FEMA return 
date from 2010 through 2019 to estimate the potential change in speed 
of assistance of this change. FEMA analyzed applicants that FEMA 
referred to SBA because their income met the referral threshold but who 
were denied an SBA loan and returned to FEMA for ONA. FEMA estimates 
that 364,334 (36,433 per year) such applications were referred to SBA 
and returned to FEMA for ONA. On average, 33.6 days (12,244,620 days / 
364,334 applicants) were required for those referred to SBA for loan 
repayment eligible consideration, determined ineligible for SBA loans, 
and returned to FEMA for ONA. Two potential reasons for this time delay 
estimate could be high volume of SBA referred applicants during the 
initial days following the disaster and non-responsiveness of 
applicants. FEMA anticipates that eliminating the need to apply to SBA 
for a loan before receiving ONA will reduce the time it takes for these 
36,433 applicants to receive assistance from FEMA by 33.6 days, thereby 
streamlining the disaster assistance process for many individuals. Non-
repayable assistance grants to survivors also provides greater 
financial assistance, than repayable SBA loans, allowing disaster 
survivors and communities to recover more quickly. Additionally, lower 
income survivors are less likely to apply for an SBA loan, due to 
uncertain financial and employment conditions following a disaster. 
Benefits of this change will remove administrative burdens to increase 
applicant access to assistance.
    Benefits from streamlining the appeals process by removing the 
signed letter requirement are that the appeal requirements will be more 
equitable and flexible. Applicants could still submit a signed letter 
explaining the reason(s) for an appeal or applicants could instead 
choose to provide verifiable documentation of their appeal. To further 
assist applicants with navigating

[[Page 4062]]

the appeals process, FEMA is creating an optional appeal request form 
for an applicant to use when submitting an appeal. FEMA expects that 
this optional appeal request form increases the approval rate for 
disaster survivors seeking assistance.
    FEMA's change for CTHA incremental documentation requirements for 
PHPs will lessen applicant burden and help FEMA provide appropriate 
resources and assistance to applicants throughout their housing 
recovery process. FEMA recognizes that post-disaster recovery can be a 
challenge for all applicants, FEMA will engage more closely to assist 
applicants in achieving a recovery outcome by the end of the period of 
assistance. Depending on the disaster, applicants may not be able to 
satisfy requirements of a PHP during the initial application. To 
expedite the recovery process, FEMA will remove the requirement for 
applicants to select a permanent housing plan during the initial 
application. FEMA will work with applicants through all recertification 
intervals to review their progress toward their PHP and identify 
specific resources to assist the applicant in achieving their recovery 
goals.
    Benefits from the establishment of Displacement Assistance will 
address the need many disaster survivors have for short-term 
transitional assistance. Displacement Assistance will also be a more 
equitable and efficient way to provide short-term lodging rather than 
LER, as it is proactive assistance increasing the benefit for 
applicants that do not have the means to pay for lodging costs up 
front. It will also improve assistance equity as displaced disaster 
survivors within an area receive a consist amount of assistance to 
address their short-term lodging needs ensuring displaced survivors 
receive assistance covering common needs and allows for recipients to 
receive assistance quickly. Displacement Assistance also improves 
assistance flexibility and may avoid unintended use of funds, reducing 
the risk of applicants unable to qualify for Rental Assistance because 
they spent Rental Assistance funds on immediate needs or ineligible 
temporary housing solutions like staying with friends and family.
    FEMA's change establishing Serious Needs Assistance will broaden 
eligible expense categories compared with CNA, thereby improving 
assistance flexibility. This change may avoid unintended use of funds 
reducing the risk of applicants unable to qualify for other FEMA 
assistance because they spent the prior more narrowly defined CNA on 
other needs. It will also provide all impacted disaster survivors a 
consistent amount of assistance ensuring all displaced survivors 
receive assistance covering common needs and allows for recipients to 
receive assistance more quickly. The benefits of establishing Serious 
Needs Assistance improves assistance flexibility to better help 
disaster survivors.
    Benefits from expanding Home Repair and Home Replacement Assistance 
eligibility for accessibility-related items when these items were not 
present prior to the disaster and are necessary to make the damaged 
home safe and functional for someone who has a pre-existing disability 
increases assistance equity for those disaster survivors with a 
disability. This change will also address unmet needs and more 
effectively assist applicants achieve permanent housing solutions. FEMA 
continually faces challenges finding available accessible housing post-
disaster, as there is a limited amount of accessible housing stock.
    FEMA's change of broadening the ``uninhabitable'' definition to 
encompass disaster damage to the applicant's primary residence that 
causes the home to be unsuitable for occupancy better supports disaster 
survivors whose residences incurred disaster damage. According to the 
Federal Reserve, 32 percent of Americans could not cover an emergency 
expense of $400 with cash or its equivalent, with 11 percent saying 
they would be unable to pay the expense by any means.\382\ This change 
will better support low income and other vulnerable disaster survivors 
who may not have the means to immediately address disaster damage. 
Additionally, FEMA is removing the requirement for disaster-damaged 
real property components to be functional immediately before the 
disaster for pre-existing damages exacerbated by the disaster. The 
benefit of expanding assistance increases types of eligible repairs and 
speed the repair of disaster-damaged dwellings for disaster survivors.
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    \382\ Federal Reserve Board, Report on the Economic Well-Being 
of U.S. Households 2021, Figures 19 and 20, https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm https://www.federalreserve.gov/publications/2022-economic-well-being-of-us-households-in-2021-dealing-with-unexpected-expenses.htm.
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    Benefits from expanding Personal Property Assistance so that a 
household may receive financial assistance for a disaster-damaged 
computing device, regardless of its intended use will provide 
additional assistance to help survivors replace disaster-damaged 
computing devices. This change reflects FEMA recognizing technology 
continues to have an increasing role in how households communicate, 
manage finances, and facilitate many other necessary aspects of daily 
living. This change aligns with the purpose of IHP is to determine what 
meets the basic needs of disaster survivors. In the current landscape, 
most households have a computing device; \383\ therefore, it may be an 
essential need. Additionally, many states have requested that FEMA 
provide assistance for these types of items on their annual submission 
of their ONA Administrative Option Selection Form reflecting the 
importance of computing devices for disaster survivors.
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    \383\ In April 2021, the U.S. Census Bureau released a report 
that examined trends in computer and internet use in 2018. Per the 
report, among all households in 2018, 92 percent had at least one 
type of computer. Please see https://www.census.gov/content/dam/Census/library/publications/2021/acs/acs-49.pdf for further 
information. This shows an increase in computer prevalence as 
compared to a 2016 study conducted by the Pew Research Center, which 
noted that 80 percent of American households had at least one 
desktop or laptop computer in their home. Additional data from the 
2016 study conducted by the Pew Research Center study showed that a 
third of U.S. households had access to three or more smartphones. 
Please see https://www.pewresearch.org/fact-tank/2017/05/25/a-third-of-americans-live-in-a-household-with-three-or-more-smartphones/.
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    FEMA's change for insurance proceeds, no longer comparing net 
insurance settlement amounts to the applicable maximum IHP Assistance 
amount when determining eligibility will more equitably address the 
unmet needs of underinsured applicants. FEMA's current use of the 
applicable maximum IHP Assistance amount as a threshold for determining 
eligibility creates an inequity between similarly impacted applicants. 
A one-dollar difference in net insurance settlement at the applicable 
maximum IHP Assistance amount determines an applicant's ineligibility 
for potentially thousands of dollars in IHP Assistance verses an 
applicant with one dollar less in net settlement who will be eligible. 
Excluding those insured applicants with a net insurance settlement 
amount that

[[Page 4063]]

is equal to or exceeds the applicable maximum IHP Assistance amount can 
pose an obstacle to them achieving a permanent housing solution, 
especially for lower income homeowners, as lower income ineligible 
underinsured homeowners may be unable to afford the unmet need to 
repair their home.
Pre-Guidance Baseline
    Under a pre-guidance baseline, the benefits above will apply as 
well as the benefits of the changes FEMA has already implemented and is 
codifying. The following provides an overview of additional equity 
(consistent, systematic fair, just, and impartial treatment of all) 
benefits under a pre-guidance baseline.
    Amending the definition of ``financial ability'' to pay by removing 
the comparison between pre-disaster and post-disaster income and 
awarding CTHA recipients 30 percent of their post-disaster housing 
income streamlines applicant documentation and more accurately measures 
applicants' post-disaster financial situation. This change also reduced 
documentation of the pre-disaster income to lessen applicant burdens.
    FEMA's change for MLR to lease, repair, and improve existing, 
vacant multifamily units as a type of temporary housing for applicants 
is cost-effective and more survivor-centric alternative to other 
temporary housing options. In addition to cost-effectiveness and 
improvements to properties that benefit affected communities, 
multifamily lease and repair assistance will provide more capacity for 
temporary housing. If available properties in the designated area are 
exhausted, applicants or FEMA will have more flexibility by 
incorporating this option in the portfolio of housing solutions.
    In 2014, FEMA expanded assistance to recognize child care as a 
disaster-caused financial burden because the applicant's gross 
household income has decreased as a direct result of the disaster or 
because child care expenses have increased as a result of the disaster. 
By increasing assistance eligibility and reducing disruptions to 
affordable, local child care services, FEMA enables applicants to 
financially recuperate sooner and reduces disruptions to families.
    FEMA's change allowing applicants to use security deposit payments 
for another property when an applicant is unable to return to their 
disaster-damaged home better assists applicants by allowing the 
recipient to make timely progress toward finding a long-term housing 
solution. This change increases assistance flexibility to better help 
the survivor recover.
    FEMA revisions to align with section 698d of the PKEMRA to allow 
for payments of utilities, excluding telephone service. Providing 
additional assistance for utility payments increases CTHA flexibility 
to better help displaced survivors recover by reducing temporary 
housing burden costs for those with financial needs.
    Benefits from removal of Temporary Housing Assistance applied to 
the Financial Housing Assistance maximum ensures those applicants with 
the most severe disaster damage may still have funds available to them 
for temporary housing solutions.
    FEMA's change to have separate and individual maximum caps for HA 
and ONA ensures those applicants with the most severe disaster damage 
receive eligible assistance at least equivalent to similarly impacted 
disaster survivors for HA and ONA. This policy change removes limiting 
HA like Home Repair Assistance due to assistance already ready received 
for ONA.
    FEMA change to waive debt for individuals and households who 
received assistance through the IHP that was distributed in error by 
FEMA benefitted disaster survivors who accrued this debt through no 
fault of their own. This change reduced repayment burden for these 
applicants which could place additional financial hardship on disaster 
survivors. FEMA made this policy change to align with DRRA.
9. Baseline Time Period
    As discussed above, to provide a full understanding of the impacts 
of the policy changes discussed in this rule, DHS measured their 
impacts relative to two baselines. The no action baseline represents a 
state o the world under current FEMA policies; that is, impacts of the 
rule as compared to IA Guidance. The second baseline considered in the 
analysis is the pre-guidance baseline, which represents a state of the 
world before statutory changes and/or FEMA's implementing guidance. 
Table 13 provides a summary of the impacts of the rule over a 10-year 
future period of analysis as measured against a no-action baseline. 
Table 14 provides a summary of the impacts measured against the pre-
guidance baseline for a 21-period of analysis that includes the actual 
impacts from the changes that FEMA has already implemented and will 
codify (2010-2019) combined with the future impacts of these changes 
and the new changes FEMA implements through this rule (2020-2030).
BILLING CODE 9111-24-P

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BILLING CODE 9111-24-C

C. Regulatory Flexibility Act

    The Regulatory Flexibility Act (RFA) (5 U.S.C. 601-612), and 
section 213(a) of the Small Business Regulatory Enforcement Fairness 
Act of 1996, Public Law 104-121, 110 Stat. 847, 858-59 (Mar. 29, 1996) 
(5 U.S.C. 601 note) require that special consideration be given to the 
effects of regulations on small entities. When an agency is required to 
publish a general NPRM, it must prepare a regulatory flexibility 
analysis describing the impact of the rule on small entities.\399\ FEMA 
is not required, by the Administrative Procedure Act (APA) or any other 
law, to publish a general NPRM for this rule. Therefore, FEMA is not 
required to prepare a regulatory flexibility analysis for this rule.
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    \399\ See 5 U.S.C. 603-604.
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    As is discussed above, the APA generally requires agencies to 
publish an NPRM, but it provides an exception for matters relating to 
public property, loans, grants, benefits, or contracts.\400\ This rule 
amends FEMA's regulations related to grant funding FEMA provides under 
the IHP. As such, it is exempt from the APA's notice and comment 
requirements and therefore from the RFA's requirements. Until recently, 
FEMA waived the exemption afforded to grant programs under the APA and 
treated its programs as if they were subject to traditional notice and 
comment requirements. On March 3, 2022, FEMA published the 
``Regulations on Rulemaking Procedures Final Rule'' clarifying its 
position regarding notice and comment rulemaking for its grant 
programs.\401\ FEMA determined that removal of the waiver of the 
exemption streamlined the regulations and ensured that the agency 
retained the flexibility to utilize a range of public engagement 
options in advance of rulemaking where appropriate. FEMA noted that it 
would retain its general policy in favor of public participation in 
rulemaking but would retain discretion to depart from this policy as 
circumstances warrant.
---------------------------------------------------------------------------

    \400\ 5 U.S.C. 553(a)(2), (b) and (c).
    \401\ See 87 FR 11971, Mar. 3, 2022.
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    This rulemaking is related to financial assistance and direct 
services FEMA provides to individuals and households who, as a direct 
result of a major disaster, have necessary expenses and serious needs 
in cases in which the individuals and households are unable to meet 
such expenses or needs through other means. 42 U.S.C. 5174. The only 
part of the rulemaking which might affect small entities are the 
changes to 44 CFR 206.113(b)(9) where FEMA is allowing self-employed 
individuals to receive personal property assistance for essential tools 
damaged in the disaster. That means this rulemaking will not have a 
significant impact on small entities as it will only impact those self-
employed individuals who choose to apply for personal property 
assistance, in their individual capacity, not as a self-employed 
business.\402\ Self-employed individuals who feel that the information 
collection requirements are too onerous do not have to apply for 
assistance as this is a voluntary grant program. Based on these 
circumstances, FEMA is not preparing a regulatory flexibility analysis 
because this rule is unlikely to have a significant impact on small 
entities.
---------------------------------------------------------------------------

    \402\ Businesses will continue to be ineligible under 44 CFR 
206.113(b)(9).
---------------------------------------------------------------------------

D. Unfunded Mandates Reform Act

    Pursuant to section 201 of the Unfunded Mandates Reform Act of 1995 
(Pub. L. 104-4, 2 U.S.C. 1531), each Federal agency ``shall, unless 
otherwise prohibited by law, assess the effects of Federal regulatory 
actions on State, local, and Tribal governments, and the private sector 
(other than to the extent that such regulations incorporate 
requirements specifically set forth in law).'' Section 202 of the Act 
(2 U.S.C. 1532) further requires that before promulgating any general 
NPRM that is likely to result in the promulgation of any rule that 
includes any Federal mandate that may result in expenditure by State, 
local, and Tribal governments, in the aggregate, or by the private 
sector, of $100 million or more (adjusted annually for inflation) in 
any one year, and before promulgating any final rule for which a 
general NPRM was published, the agency shall prepare a written 
statement detailing the effect on State, local, and Tribal governments 
and the private sector. This is a final rule for which a general NPRM 
was not published, and thus preparation of such a statement is not 
required.

E. National Environmental Policy Act of 1969 (NEPA)

    Section 102 of the National Environmental Policy Act of 1969 
(NEPA), 83 Stat. 852 (Jan. 1, 1970) (42 U.S.C. 4321 et seq.) requires 
Federal agencies to consider the environmental impacts of any major 
Federal action they propose that may significantly affect the quality 
of the human environment, to consider alternatives to that action, and 
mitigate any potential adverse effects. The Council on Environmental 
Quality's (CEQ) regulations for implementing NEPA, 40 CFR parts 1500 
through 1508, require each Federal agency to determine whether the 
proposed activity is a ``major Federal action'' and the appropriate 
level of NEPA review, that is, whether the action requires preparation 
of an environmental assessment (EA) or environmental impact statement 
(EIS), or if a categorical exclusion applies. 40 CFR 1501.3. Major 
Federal actions include promulgation of new or revised agency rules. 40 
CFR 1508.1(q)(2).
    For efficiency, Federal agencies identify in their NEPA 
implementing procedures categories of actions (categorical exclusions 
(CATEXs)) that normally do not have a significant effect on the human 
environment individually or cumulatively. 40 CFR 1501.4. If a CATEX 
applies then the, preparation of an EA or environmental impact 
statement EIS is not required. However, the Federal agency must 
determine if there are extraordinary circumstances which may result in 
the action having a significant impact. If the agency can lessen the 
significance of the impact, the agency may still apply the CATEX. 
However, if there is a significant impact, the CATEX does not apply, 
and further environmental review is required. 40 CFR 1501.4. If an 
action does not qualify for a CATEX and has the potential to 
significantly effect the environment, the agency must prepare an EA to 
evaluate the environmental impact of the action. The EA will determine 
whether the agency may issue a finding of no significant impact or must 
prepare an EIS. A Federal agency is required to prepare an EIS if the 
proposed action will have significant effects on the quality of the 
human environment. 40 CFR 1501.3, 1502.3.
    DHS has established categorical exclusions for categories of 
actions that experience has shown do not individually or cumulatively 
have a significant effect on the human environment. The DHS categorical 
exclusions are listed in Appendix A of DHS Instruction Manual 023-01-
001-01, Implementing the National Environmental Policy Act (Instruction 
Manual). The Instruction Manual and associated DHS Directive 023-01, 
Implementing the National Environmental Policy Act, establish the 
policies and procedures DHS and its component agencies use to comply 
with NEPA and CEQ's NEPA regulations. Under DHS NEPA implementing 
procedures, for an action to be categorically excluded, it must satisfy 
each of the following three conditions: (1) The entire action clearly 
fits within one or more of the categorical exclusions; (2) the action 
is not a piece

[[Page 4109]]

of a larger action; and (3) no extraordinary circumstances exist that 
create the potential for a significant environmental effect.
    The majority of the revisions in this rulemaking apply to the 
regulations for the Individuals and Households Program, which is a 
voluntary grant program that provides financial assistance and direct 
services to eligible individuals and households who have uninsured or 
underinsured necessary expenses and serious needs as a result of a 
Presidentially-declared disaster. FEMA publishes this IFR to amend its 
regulations governing the Individual Assistance program to increase 
equity by simplifying processes, removing barriers to entry, and 
increasing eligibility for certain types of assistance under the 
program. Specifically, the IFR increases eligibility for home repair 
assistance by amending the definitions and application of the terms 
safe, sanitary, and functional, allowing assistance for certain 
accessibility-related items, and amending its approach to evaluating 
insurance proceeds; allows for the re-opening of the applicant 
registration period when the President adds new counties to the major 
disaster declaration; simplifies the documentation requirements for 
continued temporary housing assistance; simplifies the appeals process; 
simplifies the process to request approval for a late registration; 
removes the requirement to apply for a Small Business Administration 
loan as a condition of eligibility for ONA; and establishes additional 
eligible assistance under ONA for serious needs, displacement, 
disaster-damaged computing devices and essential tools for self-
employed individuals. FEMA also makes revisions to reflect changes to 
statutory authority that have not yet been implemented in regulation, 
to include provisions for utility and security deposit payments, lease 
and repair of multifamily rental housing, child care assistance, 
maximum assistance limits, and waiver authority. This action is not a 
piece of a larger action, but rather amends subpart D, E, and F of 44 
CFR part 206 \403\ as a standalone action.
---------------------------------------------------------------------------

    \403\ This IFR revises Subpart D--Federal Assistance to 
Individuals and Households, removes and reserves Subpart E--
Individual and Family Grant Programs, and revises only Sec.  206.191 
of Subpart F--Other Individual Assistance.
---------------------------------------------------------------------------

    These changes implement existing statutory requirements and amend 
existing regulations. FEMA is not aware of any significant impact on 
the environment or any change in environmental effect that will result 
from these changes. Accordingly, FEMA finds promulgation of this rule 
clearly fits within the scope of Categorical Exclusion A(3) in Appendix 
A of the Instruction Manual, which provides a categorical exclusion for 
promulgation of certain types of rules, including rules that interpret 
or amend an existing regulation without changing its environmental 
effect (Categorical Exclusion A3(d)).
    In accordance with DHS NEPA implementing procedures, FEMA finds no 
extraordinary circumstances associated with this rulemaking that may 
give rise to significant environmental effects requiring further 
analysis and documentation. This rule addresses specific amendments to 
subpart D, E, and F of 44 CFR part 206 and is not part of a larger 
action by FEMA. This action is therefore categorically excluded, and no 
further NEPA analysis or documentation is required.

F. Paperwork Reduction Act of 1995

    This rule contains information collection revisions necessary to 
support FEMA's implementation of the Individual Assistance Program 
Equity Interim Final Rule. The Individual Assistance Registration and 
Individuals and Households Program collections are assigned OMB Control 
Numbers 1660-0002 and 1660-0061. The collections are submitted under 
OMB's emergency clearance procedures to allow implementation as of the 
effective date of this interim final rule. Additionally, FEMA will seek 
public comments on both collections through the normal clearance 
process.

G. Privacy Act/E-Government Act of 2002

    Under the Privacy Act, 5 U.S.C. 552a, an agency must determine 
whether implementation of a proposed regulation will result in a system 
of records. A ``record'' is any item, collection, or grouping of 
information about an individual that is maintained by an agency, 
including, but not limited to, his/her education, financial 
transactions, medical history, and criminal or employment history and 
that contains his/her name, or the identifying number, symbol, or other 
identifying particular assigned to the individual, such as a finger or 
voice print or a photograph. See 5 U.S.C. 552a(a)(4). A ``system of 
records'' is a group of records under the control of an agency from 
which information is retrieved by the name of the individual or by some 
identifying number, symbol, or other identifying particular assigned to 
the individual. An agency cannot disclose any record which is contained 
in a system of records without written consent from the file subject, 
or an applicable Privacy Act exception. 5 U.S.C. 552a(b).
    The E-Government Act of 2002, 44 U.S.C. 3501 note, also requires 
specific procedures when an agency takes action to develop or procure 
information technology that collects, maintains, or disseminates 
information that is in an identifiable form. This Act also applies when 
an agency initiates a new collection of information that will be 
collected, maintained, or disseminated using information technology if 
it includes any information in an identifiable form permitting the 
physical or online contacting of a specific individual.
    To meet the requirements of the Privacy Act and E-Government Act of 
2002, the agency performed a Privacy Threshold Analysis, which is an 
initial determination of whether the regulation triggers the 
requirements of either of those Acts. The system is covered by the 
existing Privacy Impact Assessments (PIAs): DHS/FEMA/PIA-049 Individual 
Assistance (IA) Program and DHS/FEMA/PIA-057 Individuals and Households 
Program Equity Analysis. The system is also covered by an existing 
System of Records Notice: DHS/FEMA-008 Disaster Recovery Assistance 
Files.

H. Executive Order 13175, Consultation and Coordination With Indian 
Tribal Governments

    Executive Order 13175, ``Consultation and Coordination With Indian 
Tribal Governments,'' 65 FR 67249, Nov. 9, 2000 applies to agency 
regulations that have Tribal implications, that is, regulations that 
have substantial direct effects on one or more Indian Tribes, on the 
relationship between the Federal Government and Indian Tribes, or on 
the distribution of power and responsibilities between the Federal 
Government and Indian Tribes. Under this Executive order, to the extent 
practicable and permitted by law, no agency will promulgate any 
regulation that has Tribal implications, that imposes substantial 
direct compliance costs on Indian Tribal governments, and that is not 
required by statute, unless funds necessary to pay the direct costs 
incurred by the Indian Tribal government or the Tribe in complying with 
the regulation are provided by the Federal Government, or the agency 
consults with Tribal officials.
    The majority of the revisions in this rulemaking apply to the 
regulations for the IHP, which is a voluntary grant program that 
provides financial assistance and direct services to eligible

[[Page 4110]]

individuals and households who have uninsured or underinsured necessary 
expenses and serious needs as a result of a Presidentially-declared 
disaster. FEMA publishes this IFR amending its regulations governing 
the Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program. Specifically, the IFR 
increases eligibility for home repair assistance by amending the 
definitions and application of the terms safe, sanitary, and 
functional, allowing assistance for certain accessibility-related 
items, and amending its approach to evaluating insurance proceeds; 
allows for the re-opening of the applicant registration period when the 
President adds new counties to the major disaster declaration; 
simplifies the documentation requirements for continued temporary 
housing assistance; simplifies the appeals process; simplifies the 
process to request approval for a late registration; removes the 
requirement to apply for a Small Business Administration loan as a 
condition of eligibility for ONA; and establishes additional eligible 
assistance under ONA for serious needs, displacement, disaster-damaged 
computing devices and essential tools for self-employed individuals. 
FEMA also makes revisions to reflect changes to statutory authority 
that have not yet been implemented in regulation, to include provisions 
for utility and security deposit payments, lease and repair of 
multifamily rental housing, child care assistance, maximum assistance 
limits, and waiver authority. Under the IFR, Indian Tribal members 
would have the same opportunity to participate in the IHP, as other 
eligible applicants. As a result, FEMA does not expect this IFR to have 
a substantial direct effect on one or more Indian Tribal Governments or 
impose direct compliance costs on Indian Tribal Governments. FEMA does 
not expect the regulations to have substantial direct effects on the 
relationship between the Federal Government and Indian Tribal 
Governments or on the distribution of power and responsibilities 
between the Federal Government and Indian Tribal Governments.
    In its request for information,\404\ FEMA received four comments 
from Indian Tribal Governments or members of Indian Tribal Governments 
that were relevant to this rule.\405\
---------------------------------------------------------------------------

    \404\ 86 FR 21325, Apr. 22, 2021.
    \405\ There were other general Tribal comments received on the 
request for information, but they are outside the scope of this rule 
and are not discussed here.
---------------------------------------------------------------------------

Subsistence Practices
    All four of the comments addressed the same general issue: the 
eligibility of subsistence cabins and equipment under IHP.\406\ The 
commenters detailed how the subsistence cabins and fish drying 
equipment in an Alaska Native community were damaged by flooding, but 
the Alaska Department of Homeland Security and Emergency Management did 
not provide assistance for these damages because it determined that 
Federal regulations limited eligibility for IHP ONA to property in or 
near a person's home. One commenter stated that the State's ONA State 
Specific Items list, which they obtained through a public records 
request, includes certain types of subsistence equipment that are 
eligible, but only if the items are stored at a person's home at the 
time of the disaster.\407\ This commenter explained that the 
subsistence cabins and equipment should be and are eligible for 
assistance, regardless of location, and stated FEMA must amend its 
regulations to clarify this eligibility. Another commenter requested 
FEMA mandate the State of Alaska provide assistance for the repair and 
replacement of the subsistence cabins and fish drying equipment, even 
outside the community that they reside.\408\
---------------------------------------------------------------------------

    \406\ FEMA-2021-0011-0176 (pages 19-20, 27-28, representing two 
separate commenters), FEMA-2021-0011-0246, and FEMA-2021-0011-0283.
    \407\ FEMA-2021-0011-0246.
    \408\ FEMA-2021-0011-0283.
---------------------------------------------------------------------------

    There are a number of different factors that can impact eligibility 
under IHP ONA and a close review of the specific circumstances for 
these subsistence cabins and equipment would be needed to determine 
whether they are in fact eligible. Even if a given item is eligible, 
however, the applicable STT government for the declaration must 
identify all the ONA-eligible personal property and miscellaneous items 
it wishes to cover, as well as the maximum number of items each 
individual or household may receive.\409\
---------------------------------------------------------------------------

    \409\ See page 149 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
---------------------------------------------------------------------------

    Per current regulations, 44 CFR 206.113(b)(9), FEMA may not provide 
IHP assistance for business losses, including farm businesses and self-
employment. Under current policy, self-employed individuals are 
eligible for FEMA assistance for their personal losses, but not for 
necessary expenses and serious needs related to business losses.
    As part of this IFR and in response to comments received on the 
agency's RFI, FEMA amends its regulations to allow FEMA to provide 
self-employed applicants with IHP financial assistance for necessary 
expenses and serious needs for occupational tools. Assistance would be 
based on a need to replace certain disaster-damaged items required for 
self-employment. This would include disaster-damaged tools and 
equipment, or other items required for a specific trade or profession, 
not provided or supplied by the employer. Depending on the item 
requested by the applicant and its purpose, subsistence items may be 
eligible for assistance under this authority.

I. Executive Order 13132, Federalism

    A rule has implications for federalism under Executive Order 13132 
``Federalism'' (64 FR 43255, Aug. 10, 1999), if it has a substantial 
direct effect on the States, on the relationship between the national 
government and the States, or on the distribution of power and 
responsibilities among the various levels of government. FEMA has 
analyzed this rule under Executive Order 13132 and determined that it 
does not have implications for federalism.

J. Executive Order 12630, Taking of Private Property

    This rule will not effect a taking of private property or otherwise 
have taking implications under Executive Order 12630, ``Governmental 
Actions and Interference With Constitutionally Protected Property 
Rights'' (53 FR 8859, Mar. 18, 1988).

K. Executive Order 12898, Environmental Justice and Executive Order 
14096, Revitalizing Our Nation's Commitment to Environmental Justice 
for All

    Executive Order 12898 ``Federal Actions To Address Environmental 
Justice in Minority Populations and Low-Income Populations'' (59 FR 
7629, Feb. 16, 1994), as amended by Executive Order 12948 (60 FR 6381, 
Feb. 1, 1995) mandates that Federal agencies identify and address, as 
appropriate, disproportionately high and adverse human health or 
environmental effects of their programs, policies, and activities on 
minority populations and low-income populations. It requires each 
Federal agency to conduct its programs, policies, and activities that 
substantially affect human health or the environment in a manner that 
ensures that those programs, policies, and activities do not have the 
effect of excluding persons from participation in, denying persons the 
benefit of, or subjecting persons to discrimination

[[Page 4111]]

because of their race, color, or national origin or income level.
    The supplemental definition of ``Environmental Justice'' in sec. 
2.(b)(ii) of Executive Order 14096 ``Revitalizing Our Nation's 
Commitment to Environmental Justice for All'' (88 FR 25251, April 26, 
2023) includes the just treatment and meaningful involvement of all 
people such that they have equitable access to subsistence practices 
and the Section 1 policy statement says that the Federal Government 
must recognize, honor and respect the different cultural practices--
including subsistence practices, ways of living, Indigenous Knowledge, 
and traditions--in communities across America.
    The majority of the revisions in this rulemaking apply to the 
regulations for the IHP, which is a voluntary grant program that 
provides financial assistance and direct services to eligible 
individuals and households who have uninsured or underinsured necessary 
expenses and serious needs as a result of a Presidentially-declared 
disaster FEMA publishes this IFR amending its regulations governing the 
Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program. Specifically, the IFR 
increases eligibility for home repair assistance by amending the 
definitions and application of the terms safe, sanitary, and 
functional, allowing assistance for certain accessibility-related 
items, and amending its approach to evaluating insurance proceeds; 
allows for the re-opening of the applicant registration period when the 
President adds new counties to the major disaster declaration; 
simplifies the documentation requirements for continued temporary 
housing assistance; simplifies the appeals process; simplifies the 
process to request approval for a late registration; removes the 
requirement to apply for a Small Business Administration loan as a 
condition of eligibility for ONA; and establishes additional eligible 
assistance under ONA for serious needs, displacement, disaster-damaged 
computing devices and essential tools for self-employed individuals. 
FEMA also makes revisions to reflect changes to statutory authority 
that have not yet been implemented in regulation, to include provisions 
for utility and security deposit payments, lease and repair of 
multifamily rental housing, child care assistance, maximum assistance 
limits, and waiver authority. There are no adverse effects and no 
disproportionate effects on minority populations and low-income 
populations.
    On April 22, 2021, FEMA published an RFI on FEMA Programs, 
Regulations, and Policies.\410\ FEMA sought public input on its 
programs, regulations, collections of information, and policies for the 
agency to ensure that its programs, regulations, and policies contain 
necessary, properly tailored, and up-to-date requirements that 
effectively achieve FEMA's mission in a manner that furthers the goals 
of advancing equity for all, including those in underserved 
communities; bolstering resilience from the impacts of climate change, 
particularly for those disproportionately impacted by climate change; 
and environmental justice.
---------------------------------------------------------------------------

    \410\ 86 FR 21325, Apr. 22, 2021.
---------------------------------------------------------------------------

    FEMA held public meetings and extended the comment period on the 
RFI to ensure all interested parties had sufficient opportunity to 
provide comments on FEMA's programs.\411\ All relevant comments 
received in response to the request for information, including those 
received during the public meetings, have been posted to the public 
rulemaking docket on the Federal eRulemaking portal at https://www.regulations.gov/document/FEMA-2021-0011-0001/comment.
---------------------------------------------------------------------------

    \411\ See ``Request for Information on FEMA Programs, 
Regulations, and Policies; Public Meetings; Extension of Comment 
Period,'' 86 FR 30326, June 7, 2021.
---------------------------------------------------------------------------

    In response to its RFI, FEMA received five comments on 
environmental justice related to this rule.\412\ One commenter stated 
that people with disabilities or who live in persistent poverty may 
often have homes that do not meet FEMA's ``safe and habitable'' 
standard and that FEMA's limitations on housing recovery efforts beyond 
a pre-disaster state leaves these people only with housing options that 
are even more susceptible to negative environmental impact.\413\ 
Additionally, the commenter stated that because the Individual 
Assistance program does not cover accessibility-related items for pre-
existing or disaster acquired disabilities, many disabled people must 
choose between accessible housing structures or communities that afford 
more environmental justice opportunities. The commenter stated that 
this increases inequity and environmental injustice for disabled 
persons and that accounting for these environmental needs and covering 
these expenses would promote environmental justice.
---------------------------------------------------------------------------

    \412\ There were more comments that raised environmental justice 
issues generally, but they are outside the scope of this rule and 
are not discussed here.
    \413\ FEMA-2021-0011-0164.
---------------------------------------------------------------------------

    FEMA recognizes that current regulations limit assistance to 
applicants with residences that incurred disaster-caused damage; 
therefore, the regulations, as written, do not allow FEMA to address 
applicants' immediate safety and sanitation concerns and prevent FEMA 
from addressing or assessing the general livability issues with the 
applicant's residence when determining Housing Assistance eligibility. 
As part of this rule, FEMA broadens the definition of uninhabitable to 
encompass any damage to the applicant's disaster damaged primary 
residence that causes the home to be unsuitable for occupancy or any 
disaster damage, that if left unrepaired, would impact habitability in 
the future. FEMA redefines ``uninhabitable'' to mean the dwelling is 
not safe or sanitary. ``Safe'' will refer to being secure from hazards 
or threats to occupants, and ``sanitary'' will refer to being free of 
health hazards. FEMA also removes the requirement for disaster-damaged 
real property components to be functional immediately before the 
disaster in order to provide assistance for pre-existing damage 
exacerbated by the disaster. Applicants with minimal damage, including 
those without the means to pay for minimal damage or who are unable to 
complete the work themselves, would generally be eligible for Home 
Repair Assistance under the regulations.
    In response to public requests for IHP policy that meets 
applicants' disaster-caused structural home modification needs, FEMA 
recently amended its Home Repair Assistance policy to include 
Assistance for Disaster-Caused Americans with Disabilities Act (ADA) 
Real Property Needs. The September 2, 2021, Amendment to FEMA Policy 
(FP) 104-009-03, Individual Assistance Program and Policy Guide 
(IAPPG), Version 1.1 memorandum currently states that FEMA may provide 
financial assistance to applicants who incur a disaster-caused 
disability and consequently require the installation or construction of 
accessibility-related real property components at their damaged 
dwelling to meet their needs. Home Repair Assistance for specific 
accessibility-related items is not limited by a financial maximum 
award. The following accessibility-related items are eligible under 
Home Repair Assistance when the applicant or a member of the household 
has a disaster-caused disability:
     Exterior ramp.
     Grab bars.

[[Page 4112]]

     Paved path of travel to the primary residential entrance 
(for accessible ingress or egress from the applicant's vehicle to their 
dwelling).
    In response to public comments, FEMA has also changes to the 
regulatory text at 44 CFR 206.117(b)(2) and a new 44 CFR 206.113(a)(9) 
as a part of this IFR. The changes will allow FEMA flexibility to 
provide financial assistance to applicants for the installation or 
construction of real property items that were not present in the home 
prior to the disaster. Specifically, these changes would allow IHP to 
expand its existing policy, which provides for the installation of ADA 
related real property to applicants with disaster-caused needs, to 
include Home Repair Assistance for disaster survivors with pre-
existing, pre-disaster needs for accessibility-related items, such as 
an exterior ramp, grab bars, etc., that make their home safe and 
functional when any level of disaster-caused real property damage 
occurs to the primary residence.
    One commenter recommended programmatic changes they stated would 
promote environmental justice.\414\ First, the commenter suggested FEMA 
automatically deem applicants eligible for disaster assistance if they 
are already eligible for or enrolled in other Government aid programs, 
such as Medicaid, Supplemental Security Income, or Temporary Assistance 
for Needy Families.
---------------------------------------------------------------------------

    \414\ FEMA-2021-0011-0245.
---------------------------------------------------------------------------

    Different Federal aid programs have different statutory 
requirements for eligibility and an applicant who qualifies for one may 
not necessarily qualify for another. The eligibility standards for 
FEMA's IA Program are not the same as those for the other Federal 
programs the commenter listed, and FEMA is not able to change statutory 
requirements via regulation.
    The commenter further suggested a way to streamline policies to 
promote environmental justice is to connect agency databases. This way, 
Federal Government agencies already working with individuals from 
environmental justice communities, can share information about those in 
need at the time the individual makes an application for disaster 
relief.\415\ The commenter stated this may shorten application 
processing times.
---------------------------------------------------------------------------

    \415\ FEMA-2021-0011-0245.
---------------------------------------------------------------------------

    FEMA recognizes that data sharing might make it easier to access 
information about disaster survivors. However, collecting, maintaining, 
and sharing data on a large scale presents challenges with respect to 
data security. The Stafford Act and other authorities allow FEMA to 
collect personal information to determine eligibility and administer 
FEMA disaster assistance as a result of an Emergency or a 
Presidentially-declared disaster. FEMA cannot use other agencies' data 
for purposes not specifically authorized by statute.
    The same commenter stated that to further promote equity, 
resilience to climate change, and environmental justice, FEMA should 
reduce its focus and the resources it commits to preventing fraud and 
duplication of benefits.\416\
---------------------------------------------------------------------------

    \416\ FEMA-2021-0011-0245.
---------------------------------------------------------------------------

    Section 312(a) of the Stafford Act, 42 U.S.C. 5155(a), requires all 
Federal agencies to prevent recipients of disaster assistance from 
receiving such assistance for losses as to which the recipient has 
received financial assistance under any other program or from insurance 
or any other source. In short, 42 U.S.C. 5155(a) prohibits the use of 
Federal disaster assistance to pay a person or entity twice for the 
same disaster loss. In addition, per Section 408(i) of the Stafford 
Act, 42 U.S.C. 5174, FEMA must develop a system, including an 
electronic database, that minimizes the risk of making duplicative 
payments or payments for fraudulent claims under this section. FEMA 
must ensure good stewardship of taxpayers' funds and avoid both fraud 
and duplication of benefits as mandated by law. Section 696 of PKEMRA, 
6 U.S.C. 795, also requires FEMA to develop and maintain proper 
internal management controls to prevent and detect fraud, waste, and 
abuse.
    While FEMA continues to ensure we remain good stewards of 
taxpayers' funds, based on the comments received via the RFI, FEMA 
updated its policy to provide more documentation flexibilities in order 
to verify occupancy. Specifically, as outlined in the Amendment to FEMA 
Policy (FP) 104-009-03, Individual Assistance Program and Policy Guide 
(IAPPG), Version 1.1 memorandum, dated September 2, 2021, FEMA will now 
accept social service organization documents, local school documents, 
Federal or State benefit documents, motor vehicle registration, 
affidavits of residency or court documentation, and mobile home park 
documents (i.e., a letter or other written statement from the park 
owner or manager which states that the applicant or co-applicant 
occupied the disaster-damaged dwelling at the time of the disaster) in 
addition to the documentation options listed in IAPPG 1.1 to verify 
occupancy. Furthermore, as an option of last resort, FEMA may accept a 
written self-declarative statement from applicants whose pre-disaster 
residence was a mobile home or travel trailer or from applicants living 
in insular areas, islands, and Tribal lands.
    Like occupancy, when FEMA is unable to verify an applicant's 
ownership of their primary residence, the applicant may provide FEMA 
with documentation to prove ownership. Based on comments submitted via 
the RFI, FEMA also updated its policy to provide more documentation 
flexibilities in order to verify ownership. Specifically, as outlined 
in the Amendment to FEMA Policy (FP) 104-009-03, Individual Assistance 
Program and Policy Guide (IAPPG), Version 1.1 memorandum, date 
September 2, 2021, FEMA will now accept a mobile home park letter from 
the park owner or manager which states that the applicant or co-
applicant owned the disaster-damaged dwelling at the time of the 
disaster, court documents, and a public official's letter in addition 
to the documentation options listed in IAPPG 1.1 to verify ownership. 
Furthermore, as an option of last resort, FEMA may accept a written 
self-declarative statement from applicants whose pre-disaster residence 
was a mobile home or travel trailer, from applicants living in insular 
areas, islands, and Tribal lands, and from applicants whose pre-
disaster residence was passed down via heirship.
    The commenter also stated that FEMA's determination letters sent to 
IA applicants are not effective at achieving the objective of assisting 
those most at need within environmental justice communities because 
they fail to provide useful or understandable information about the 
types of assistance provided or denied and the reasons for denial.\417\ 
The commenter recommended a number of changes to the letters to address 
these issues, including using plain, simple, natural language and 
providing more information about why the applicant has been approved or 
denied and how to address denials.
---------------------------------------------------------------------------

    \417\ FEMA-2021-0011-0245.
---------------------------------------------------------------------------

    FEMA continually updates and assesses the clarity and effectiveness 
of our IHP eligibility letters. FEMA's letters do not rely solely on 
codes and provide plain language descriptions of reasons for 
ineligibility and how to appeal. FEMA's regulations, at 44 CFR 
206.115(b), require that appeals must be in writing and explain the 
reason(s) for the appeal. In this rule, FEMA is

[[Page 4113]]

removing the requirement that applicants submit a signed appeal letter 
explaining the reason for the appeal when they have provided sufficient 
substantiation through other documents. This will streamline the appeal 
process and reduce the complexity for applicants, which will speed up 
assistance to applicants and remove bureaucratic hurdles in the 
applicant's recovery process. To further assist applicants with 
navigating the appeals process, FEMA has created an optional appeal 
form that applicants could use when submitting appeals.
    The commenter stated that internet access is an environmental 
justice concern and that members of underserved communities, including 
people of color, and the elderly tend to lack reliable access to the 
internet and FEMA's online portal.\418\ The commenter further stated 
that, at least in some cases, requiring disaster survivors submit forms 
via the internet creates an unnecessary barrier to receiving aid.
---------------------------------------------------------------------------

    \418\ FEMA-2021-0011-0245.
---------------------------------------------------------------------------

    While FEMA does encourage applicants to apply online when possible, 
we appreciate that not all applicants will have reliable internet 
access, especially right after a disaster. There are other options 
besides the internet for applying for IHP assistance, and if an 
applicant prefers not using the internet or does not have reliable 
access to the internet, they may apply over the telephone or in-person, 
instead.\419\ Applicants may also submit documentation to FEMA through 
a variety of methods to include postal mail, fax, and by visiting DRCs 
that may be available in the impacted area following the disaster.
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    \419\ For more information on ways to apply, see FEMA's IHP web 
page, https://www.fema.gov/assistance/individual/program#apply. 
Additionally, FEMA does extensive outreach at disaster sites which 
would include members of underserved communities, including people 
of color and the elderly. FEMA's robust messaging of how to apply 
for FEMA assistance includes applying by telephone, using internet 
access, or by going to a DRC.
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    This commenter also stated that immigrant households and those with 
undocumented individuals face a number of environmental justice issues, 
that the FEMA application asks for information on all members of a 
household, not just the eligible members, and that the FEMA application 
and other forms indicate that information provided regarding an 
application for assistance may be shared with other DHS components, 
including U.S. Immigration and Customs Enforcement.\420\ The commenter 
recommended FEMA repeal this policy of forwarding citizenship status to 
other agencies, and update its forms to reflect such a change, because 
it has a chilling effect on applications from these households, even 
when some members of the household are eligible for assistance.
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    \420\ FEMA-2021-0011-0245.
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    While the Privacy Act requires FEMA to make applicants aware of 
this information, we have updated this data sharing language in the 
past several years to remove references to U.S. Immigration and Customs 
Enforcement and clarify the reasons FEMA would share information. The 
current version informs applicants that, consistent with the Privacy 
Act, as amended, 5 U.S.C. 552a, FEMA may share individuals' information 
with Federal, State, Tribal, and local agencies and voluntary 
organizations to enable individuals to receive additional disaster 
assistance or to allow FEMA to administer assistance.\421\
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    \421\ See ICR Reference No. 202201-1660-005, FF-104-FY-21-122 
(formerly 009-0-1) View Information Collection Request (ICR) Package 
(reginfo.gov).
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    One commenter stated that the focus of many FEMA programs on 
replacing what was lost in a disaster propagates environmental 
injustices and inequity for marginalized communities.\422\ The 
commenter further stated that numerous studies have shown that some 
neighborhoods today are still influenced by redlining that occurred 
decades ago. The commenter recommended FEMA adopt a build-forward 
approach that leverages the recovery process to implement community-
based plans to address inequities.
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    \422\ FEMA-2021-0011-0261. See ICR Reference No. 202201-1660-
005, FF-104-FY-21-122 (formerly 009-0-1) View Information Collection 
Request (ICR) Package (reginfo.gov).
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    FEMA may provide financial assistance to repair an owner-occupied 
primary residence, utilities, and residential infrastructure, including 
private access routes damaged as a result of a Presidentially-declared 
disaster. Home Repair Assistance is intended to make the damaged home 
safe, sanitary, or functional.\423\ It is not intended to return the 
home to its pre-disaster condition. Rather, currently, Home Repair 
Assistance award amounts are based on repair or replacement of 
components that are of average quality, size, or capacity and provided 
to eligible applicants who meet all requirements.
---------------------------------------------------------------------------

    \423\ See 42 U.S.C. 5174(c)(2)(A)(i).
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    In this rule, FEMA removes the requirement for real property 
components to be functional immediately before the disaster to provide 
assistance for pre-existing damage. Under this IFR, when a component of 
the home with pre-existing damage is further damaged by the disaster, 
FEMA will provide assistance to fully repair or replace the item (as 
appropriate) rather than denying assistance solely because not all 
damage was caused by the disaster.
    One commenter stated FEMA should prioritize comprehensive data 
collection and analysis to achieve the agency's equity and 
environmental justice goals, and noted this may require collecting more 
specific data than FEMA has collected before.\424\ The commenter said 
FEMA must conduct rigorous and regular analyses of the distribution of 
its aid with regards to applicants' race and ethnicity, income level 
and wealth, educational attainment, gender, disability status, age, and 
other factors that may help indicate an applicant's relationships to 
underserved communities.
---------------------------------------------------------------------------

    \424\ FEMA-2021-0011-0265.
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    In August of 2022, FEMA began gathering demographic information 
from disaster survivors that choose to provide it. This data will be 
used to assess the impact of IA Programs and policies on underserved 
populations using FEMA's existing analysis processes. Although some 
data and information will be provided for background or situational 
awareness, the objective will be to affect positive changes by 
conducting analysis of the collected data to better understand program 
outcomes accordingly based on factors such as race, ethnicity, and 
income and updating policies and programs within our regulatory and 
statutory parameters to achieve greater equity.
    This commenter also stated that FEMA could extend the process of 
self-certifying homeownership to members of underserved, historically 
marginalized, and environmental justice communities nationwide.\425\ 
The commenter stated this change could help decrease the barriers for 
``low-wealth'' and ``people of color households'' to receiving Federal 
aid and assistance.
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    \425\ FEMA-2021-0011-0265.
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    Per IAPPG 1.1, FEMA verifies occupancy through an automated public 
records search or submitted documents. In locations where automated 
verification of public records is limited, FEMA may partner with 
applicable authorities from the State, local, Tribal, or Territorial 
government to verify ownership or occupancy. When FEMA is unable to 
verify an applicant's occupancy of their disaster-damaged primary 
residence, the applicant may provide FEMA with documentation for

[[Page 4114]]

verification. Based on comments submitted via the RFI, FEMA updated its 
policy to provide more documentation flexibilities in order to verify 
occupancy. Specifically, as outlined in the Amendment to FEMA Policy 
(FP) 104-009-03, Individual Assistance Program and Policy Guide 
(IAPPG), Version 1.1 memorandum, dated September 2, 2021, FEMA will now 
accept social service organization documents, local school documents, 
Federal or State benefit documents, motor vehicle registration, 
affidavits of residency or court documentation, and mobile home park 
documents (i.e., a letter or other written statement from the park 
owner or manager which states that the applicant or co-applicant 
occupied the disaster-damaged dwelling at the time of the disaster) in 
addition to the documentation options listed in the IAPPG 1.1 to verify 
occupancy. Furthermore, as an option of last resort, FEMA may accept a 
written self-declarative statement from applicants whose pre-disaster 
residence was a mobile home or travel trailer or from applicants living 
in insular areas, islands, and Tribal lands.
    Like occupancy, when FEMA is unable to verify an applicant's 
ownership of their primary residence, the applicant may provide FEMA 
with documentation to prove ownership. Based on comments submitted via 
the RFI, FEMA also updated its policy to provide more documentation 
flexibilities in order to verify ownership. Specifically, as outlined 
in the Amendment to FEMA Policy (FP) 104-009-03, Individual Assistance 
Program and Policy Guide (IAPPG), Version 1.1 memorandum, dated 
September 2, 2021, FEMA will now accept receipts for major repairs or 
improvements, mobile home park letters from the park owner or manager 
which states that the applicant or co-applicant owned the disaster-
damaged dwelling at the time of the disaster, court documents, and a 
public official's letter in addition to the documentation options 
listed in IAPPG 1.1 to verify ownership. Furthermore, as an option of 
last resort, FEMA may accept a written self-declarative statement from 
applicants whose pre-disaster residence was a mobile home or travel 
trailer, from applicants living in insular areas, islands, and Tribal 
lands, and from applicants whose pre-disaster residence was passed down 
via heirship.
    One commenter stated that FEMA's policies forcing disaster 
survivors to rebuild their homes in hazardous and racially segregated 
and environmentally blighted areas fails to promote environmental 
justice.\426\ The commenter stated that FEMA fails to affirmatively 
further fair housing or to make housing options available outside of 
racially segregated areas to persons receiving IA and that there are 
many cases in which FEMA has effectively locked people into rebuilding 
in hazardous areas. The commenter noted that IA funding is specifically 
tied to rehabilitation of the residence affected by the disaster and 
argued that instead of spending this funding on repairs to a home in an 
area that is substandard for safe and sanitary housing, it could be 
utilized to move the affected household out of the hazardous area.
---------------------------------------------------------------------------

    \426\ FEMA-2021-0011-0277.
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    Per Section 408 of the Stafford Act, 42 U.S.C. 5174, FEMA may 
provide financial assistance to repair or replace an owner-occupied 
primary residence damaged as a result of a Presidentially-declared 
disaster. An applicant who receives Home Repair or Home Replacement 
Assistance may use the funds to either repair their disaster damaged 
dwelling or for the purchase of a home in a different location.\427\ 
Similarly, applicants who receive Rental Assistance may choose to use 
that assistance in any location in the United States.\428\ FEMA may 
also provide reimbursement of moving and storage expenses to eligible 
applicants who must relocate from their damaged home.
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    \427\ FEMA communicates the options via various means--whether 
through fact sheets, IAPPG 1.1, in person, or applicant received 
communication.
    \428\ Since August 2006, FEMA established its Rental Assistance 
Rate Increase Policy, which outlined the criteria and guidance for 
increasing the rate of Rental Assistance within a declared State 
following a presidential emergency or major disaster declaration. 
This policy is currently included at page 85 of the IAPPG 1.1. FEMA 
evaluates the need for a Rental Assistance rate increase by 
comparing U.S. Census Bureau American Community Survey statistics on 
housing inventory and vacancy rates to the best available data on 
disaster-caused housing impacts in declared disaster areas. The STT 
government may request a Rental Assistance rate increase by 
submitting other reliable sources of these data elements for FEMA to 
use. The FMR Calculator allows FEMA to rapidly evaluate the need for 
a Rental Assistance rate increase based on pre-disaster housing 
stock data, the amount of housing impacted by the disaster, and the 
post-disaster vacancy rate for each impacted county. FEMA may 
authorize Rental Assistance rate increases when the FMR Calculator 
demonstrates available housing for the area is insufficient to meet 
the disaster-caused housing need, or when elevated housing market 
rates adversely impact eligible applicants' ability to obtain rental 
resources. The RA or the FCO, if the RA has delegated authority to 
the FCO, may approve Rental Assistance rate increases for designated 
counties (or equivalent) when the FMR Calculator result indicates an 
increase above 100 percent. The increase may not exceed the amount 
indicated by the FMR Calculator, or 125 percent of the HUD FMR, 
whichever is lower.
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    FEMA recognizes that helping disaster survivors address hazard 
mitigation measures while repairing their homes from disaster damage 
will help make their homes more resilient. FEMA began including 
additional assistance for mitigation in Home Repair Assistance awards 
for disasters declared on or after May 26, 2021. Section 
408(c)(2)(A)(ii) of the Stafford Act, 42 U.S.C. 5174(c)(2)(A)(ii), 
authorizes FEMA to provide IHP assistance for eligible hazard 
mitigation measures that reduce the likelihood of future damage to such 
residences, utilities, or infrastructure, under the Home Repair 
Assistance provision. Hazard mitigation under IHP is awarded as part of 
Home Repair Assistance for specific real property components that 
existed and were functional prior to the disaster--roof, water heater, 
furnace, and main electrical panel. Hazard mitigation measures, such as 
elevating the water heater and furnace, are intended to minimize future 
damage to owner-occupied residences and are subject to the IHP maximum 
amount of Home Repair Assistance. FEMA plans to expand hazard 
mitigation under IHP in the future to include additional mitigation 
measures.
    The same commenter stated that a number of other issues impact 
environmental justice. First, the commenter stated FEMA's assistance 
policy for the homeless population is discriminatory, noting that 
homeless people living in shelters or unsheltered on the street do not 
qualify for any housing assistance.\429\ The commenter recommended FEMA 
coordinate with local organizations to provide shelter options post-
disaster to the homeless population while encouraging permanent housing 
options.
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    \429\ FEMA-2021-0011-0277.
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    FEMA's IHP assistance is intended to assist with disaster-caused 
losses. Therefore, issues related to pre-disaster homelessness are 
outside the scope of the program. As the commenter noted, applicants 
who resided in non-traditional housing (including tents) and are able 
to verify occupancy are eligible for certain types of housing 
assistance, in addition to ONA.\430\ However, temporary congregate 
sheltering options are available to homeless applicants following a 
disaster regardless of their eligibility for IHP assistance.
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    \430\ See page 62 of IAPPG 1.1. https://www.fema.gov/sites/default/files/documents/fema_iappg-1.1.pdf.
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    Second, the commenter noted that the ``Needs Assessment'' is the 
first of many applications for recovery that applicants submit and that 
it provides crucial information that gives governments a realistic 
assessment of the amount of

[[Page 4115]]

unmet need, but stated that it may be confusing for applicants that 
they also need to submit separate applications for FEMA and for HUD 
assistance.\431\ The commenter recommended the ``Needs Assessment'' be 
used as a first point of entrance into the disaster recovery mechanism 
instead of waiting for applicants to apply for FEMA or CDBG-DR funds. 
The commenter further recommended that government agencies share this 
data so that disaster survivors do not get lost in the disaster 
recovery apparatus.
---------------------------------------------------------------------------

    \431\ FEMA-2021-0011-0277.
---------------------------------------------------------------------------

    It is unclear to FEMA whether the ``Needs Assessment'' referenced 
by the commenter is a form submitted to a private organization or 
another Federal agency. If the commenter's reference is to a form 
submitted to a Federal agency, different Federal aid programs have 
different statutory requirements for eligibility and an applicant who 
qualifies for one may not necessarily qualify for another. The 
eligibility standards for FEMA's IA Program are not the same as those 
for HUD's CDBG-DR program, and FEMA is not able to change statutory 
requirements via regulation. If the ``Needs Assessment'' form is 
submitted to a private organization, it generally would not be a part 
of FEMA's operations.
    With respect to data sharing, FEMA recognizes that data sharing 
might make it easier to access information about disaster survivors. 
However, collecting, maintaining, and sharing data on a large scale 
presents challenges with respect to data security. The Stafford Act and 
other authorities allow FEMA to collect personal information to 
determine eligibility and administer FEMA disaster assistance as a 
result of an Emergency or a Presidentially declared disaster. FEMA 
cannot use other agencies' data for unintended purposes.
    Finally, the commenter noted that some types of disaster assistance 
are administered by FEMA and others by HUD and that FEMA has an 
obligation to not duplicate assistance with any other Federal program, 
but stated that this is an issue of income discrimination for low-
income survivors and also a barrier to finding stable housing in a 
housing market devastated by a disaster.\432\ The commenter stated that 
the lack of coordination between the various entities charged with 
administering recovery funds makes the overall recovery process more 
complicated, and recommended that FEMA take over temporary housing 
assistance entirely so disaster survivors may find housing not tied to 
HUD assistance while the area is still recovering. The commenter also 
recommended that FEMA allow its temporary housing funds to be used also 
as permanent repair dollars in a way that CDBG-DR funding can build on.
---------------------------------------------------------------------------

    \432\ FEMA-2021-0011-0277.
---------------------------------------------------------------------------

    The commenter is correct that FEMA must not duplicate assistance 
provided by other Federal programs. With respect to taking over other 
assistance programs outside of the Stafford Act, doing so would require 
a change to the statutory provisions underlying those programs and FEMA 
cannot change statutory provisions via rulemaking. However, FEMA is 
committed to ongoing engagement and communication with our Federal 
partners to better address the needs of traditionally underserved 
communities and will continue looking for better ways to coordinate our 
program delivery. Additionally, FEMA already provides permanent repair 
dollars in addition to temporary housing funds to eligible homeowners.
    As part of this IFR and in response to comments received on the 
agency's RFI, FEMA amends its regulations to allow FEMA to provide 
self-employed applicants with IHP financial assistance for necessary 
expenses and serious needs for occupational tools. Assistance will be 
based on a need to replace certain disaster-damaged items required for 
self-employment. This will include disaster-damaged tools and 
equipment, or other items required for a specific trade or profession, 
not provided or supplied by the employer. Depending on the item 
requested by the applicant and its purpose, subsistence items may be 
eligible for assistance under this authority. (See the Subsistence 
Practices discussion in the Executive Order 13175, Consultation and 
Coordination With Indian Tribal Governments regulatory statement.)
    Other comments received on FEMA's RFI relating to public access to 
information, which may overlap with the Environmental Justice effects 
of this rule, are discussed above in the Equity RFI--IA Program Equity 
Responses to Comments section.

L. Executive Order 12988, Civil Justice Reform

    This rule meets applicable standards in Sections 3(a) and 3(b)(2) 
of Executive Order 12988, ``Civil Justice Reform'' (61 FR 4729, Feb. 7, 
1996), to minimize litigation, eliminate ambiguity, and reduce burden.

M. Executive Order 13045, Protection of Children From Environmental 
Health Risks and Safety Risks

    This rule will not create environmental health risks or safety 
risks for children under Executive Order 13045, ``Protection of 
Children From Environmental Health Risks and Safety Risks'' (62 FR 
19885, Apr. 23, 1997).

N. Executive Order 11988, Floodplain Management

    Pursuant to Executive Order 11988, each Federal agency is required 
to provide leadership and take action to reduce the risk of flood loss, 
to minimize the impact of floods on human safety, health and welfare, 
and to restore and preserve the natural and beneficial values served by 
floodplains in carrying out its responsibilities for (1) acquiring, 
managing, and disposing of Federal lands and facilities; (2) providing 
federally undertaken, financed, or assisted construction and 
improvements; and (3) conducting Federal activities and programs 
affecting land use, including but not limited to water and related land 
resources planning, regulating, and licensing activities. In carrying 
out these responsibilities, each agency must evaluate the potential 
effects of any actions it may take in a floodplain; to ensure that its 
planning programs and budget requests reflect consideration of flood 
hazards and floodplain management; and to prescribe procedures to 
implement the policies and requirements of the Executive order, to the 
extent permitted by law.
    Before promulgating any regulation, an agency must determine 
whether the regulation will affect a floodplain(s), and if so, the 
agency must consider alternatives to avoid adverse effects and 
incompatible development in the floodplain(s). Where possible, an 
agency shall use natural systems, ecosystem processes, and nature-based 
approaches when developing alternatives for consideration. If the head 
of the agency finds that the only practicable alternative consistent 
with the law and with the policy set forth in Executive Order 11988 is 
to promulgate a regulation that affects a floodplain(s), the agency 
must, prior to promulgating the regulation, design or modify the 
regulation in order to minimize potential harm to or within the 
floodplain, consistent with the agency's floodplain management 
regulations and prepare and circulate a notice containing an 
explanation of why the action is located in the floodplain.
    The requirements of Executive Order 11988 apply in the context of 
the provision of Federal financial assistance relating to, among other 
things, construction and property improvement activities. However, this 
rule will not have an effect on floodplains. The purpose of the rule is 
to update FEMA's

[[Page 4116]]

IHP regulations to reflect statutory changes that have already been 
implemented. The majority of the revisions in this rulemaking apply to 
the regulations for the IHP, which is a voluntary grant program that 
provides financial assistance and direct services to eligible 
individuals and households who have uninsured or underinsured necessary 
expenses and serious needs as a result of a Presidentially-declared 
disaster. FEMA publishes this IFR amending its regulations governing 
the Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program. Specifically, the IFR 
increases eligibility for home repair assistance by amending the 
definitions and application of the terms safe, sanitary, and 
functional, allowing assistance for certain accessibility-related 
items, and amending its approach to evaluating insurance proceeds; 
allows for the re-opening of the applicant registration period when the 
President adds new counties to the major disaster declaration; 
simplifies the documentation requirements for continued temporary 
housing assistance; simplifies the appeals process; simplifies the 
process to request approval for a late registration; removes the 
requirement to apply for a Small Business Administration loan as a 
condition of eligibility for ONA; and establishes additional eligible 
assistance under ONA for serious needs, displacement, disaster-damaged 
computing devices and essential tools for self-employed individuals. 
FEMA also makes revisions to reflect changes to statutory authority 
that have not yet been implemented in regulation, to include provisions 
for utility and security deposit payments, lease and repair of 
multifamily rental housing, child care assistance, maximum assistance 
limits, and waiver authority.

O. Executive Order 11990, Protection of Wetlands

    Pursuant to Executive Order 11990, each Federal agency must provide 
leadership and take action to minimize the destruction, loss or 
degradation of wetlands, and to preserve and enhance the natural and 
beneficial values of wetlands in carrying out the agency's 
responsibilities for (1) acquiring, managing, and disposing of Federal 
lands and facilities; and (2) providing federally undertaken, financed, 
or assisted construction and improvements; and (3) conducting Federal 
activities and programs affecting land use, including but not limited 
to water and related land resources planning, regulating, and licensing 
activities. Each agency, to the extent permitted by law, must avoid 
undertaking or providing assistance for new construction located in 
wetlands unless the head of the agency finds (1) that there is no 
practicable alternative to such construction, and (2) that the proposed 
action includes all practicable measures to minimize harm to wetlands 
which may result from such use. In making this finding the head of the 
agency may take into account economic, environmental and other 
pertinent factors.
    In carrying out the activities described in the Executive order, 
each agency must consider factors relevant to a proposal's effect on 
the survival and quality of the wetlands. Among these factors are: 
public health, safety, and welfare, including water supply, quality, 
recharge and discharge; pollution; flood and storm hazards; and 
sediment and erosion; maintenance of natural systems, including 
conservation and long-term productivity of existing flora and fauna, 
species and habitat diversity and stability, hydrologic utility, fish, 
wildlife, timber, and food and fiber resources; and other uses of 
wetlands in the public interest, including recreational, scientific, 
and cultural uses.
    The requirements of Executive Order 11990 apply in the context of 
the provision of Federal financial assistance relating to, among other 
things, construction and property improvement activities. However, this 
rule will not have an effect on land use or wetlands. The purpose of 
the rule is to update FEMA's IHP regulations to reflect statutory 
changes that have already been implemented. The majority of the 
revisions in this rulemaking apply to the regulations for the IHP, 
which is a voluntary grant program that provides financial assistance 
and direct services to eligible individuals and households who have 
uninsured or underinsured necessary expenses and serious needs as a 
result of a Presidentially declared disaster. FEMA publishes this IFR 
amending its regulations governing the Individual Assistance program to 
increase equity by simplifying processes, removing barriers to entry, 
and increasing eligibility for certain types of assistance under the 
program. Specifically, the IFR increases eligibility for home repair 
assistance by amending the definitions and application of the terms 
safe, sanitary, and functional, allowing assistance for certain 
accessibility-related items, and amending its approach to evaluating 
insurance proceeds; allows for the re-opening of the applicant 
registration period when the President adds new counties to the major 
disaster declaration; simplifies the documentation requirements for 
continued temporary housing assistance; simplifies the appeals process; 
simplifies the process to request approval for a late registration; 
removes the requirement to apply for a Small Business Administration 
loan as a condition of eligibility for ONA; and establishes additional 
eligible assistance under ONA for serious needs, displacement, 
disaster-damaged computing devices and essential tools for self-
employed individuals. FEMA also makes revisions to reflect changes to 
statutory authority that have not yet been implemented in regulation, 
to include provisions for utility and security deposit payments, lease 
and repair of multifamily rental housing, child care assistance, 
maximum assistance limits, and waiver authority.

P. National Historic Preservation Act

    The National Historic Preservation Act (NHPA) (54 U.S.C. 300101, 
formerly 16 U.S.C. 470) was enacted in 1966, with various amendments 
throughout the years. Section 106 of the NHPA (54 U.S.C. 306108) 
requires Federal agencies to take into account the effect of a proposed 
Federal or Federally assisted undertaking on any historic property. 
Among other requirements, where there is the potential for the 
undertaking (or project) to affect historic properties, the NHPA 
mandates a consultation process in the early stages of project planning 
which must be completed prior to the approval of expenditure of the 
Federal funds. Subpart B of 36 CFR part 800 lays out a four-step 
Section 106 process to fulfill this obligation: (1) Initiate the 
process (800.3); (2) identify historic properties (800.4); (3) assess 
adverse effects (800.5); (4) resolve adverse effects (800.6). If, 
however, the agency determines that the undertaking is a type of 
activity that does not have the potential to cause effects on historic 
properties, assuming such historic properties were present, the agency 
has no further obligations under the NHPA. 36 CFR 800.3(a)(1). Based on 
over 20 years of practice, since section 206.110(m) was published, FEMA 
has determined that the proposed undertaking, excluding the stated 
exceptions, does not have the potential to cause effects on historic 
properties. Therefore, FEMA changes the language in section 206.110(m) 
to align it with the applicable statutory and regulatory language 
(i.e., 36 CFR 800.3(a)(1)).

[[Page 4117]]

    The purpose of the rule is to amend its IA regulations to increase 
equity and ease of entry to the IA Program and to update FEMA's IHP 
regulations to reflect statutory changes that have already been 
implemented. The majority of the revisions in this rulemaking apply to 
the regulations for the IHP, which is a voluntary grant program that 
provides financial assistance and direct services to eligible 
individuals and households who have uninsured or underinsured necessary 
expenses and serious needs as a result of a Presidentially-declared 
disaster. FEMA publishes this IFR amending its regulations governing 
the Individual Assistance program to increase equity by simplifying 
processes, removing barriers to entry, and increasing eligibility for 
certain types of assistance under the program. Specifically, the IFR 
increases eligibility for home repair assistance by amending the 
definitions and application of the terms safe, sanitary, and 
functional, allowing assistance for certain accessibility-related 
items, and amending its approach to evaluating insurance proceeds; 
allows for the re-opening of the applicant registration period when the 
President adds new counties to the major disaster declaration; 
simplifies the documentation requirements for continued temporary 
housing assistance; simplifies the appeals process; simplifies the 
process to request approval for a late registration; removes the 
requirement to apply for a Small Business Administration loan as a 
condition of eligibility for ONA; and establishes additional eligible 
assistance under ONA for serious needs, displacement, disaster-damaged 
computing devices and essential tools for self-employed individuals. 
FEMA also makes revisions to reflect changes to statutory authority 
that have not yet been implemented in regulation, to include provisions 
for utility and security deposit payments, lease and repair of 
multifamily rental housing, child care assistance, maximum assistance 
limits, and waiver authority.
    Pursuant to Section 106 of the NHPA and its implementing 
regulations at 36 CFR part 800, FEMA has determined that this rule does 
not have the potential to cause effects to historic properties and in 
accordance with 36 CFR 800.3(a)(1), FEMA has no further obligations 
under Section 106.

Q. Endangered Species Act

    The Endangered Species Act (ESA) mandates that Federal agencies 
determine whether their proposed actions may affect listed species and/
or their designated critical habitat (critical habitat has been 
designated for some, but not all listed species). Without authorization 
or exemption from Federal resource agencies, it is unlawful for any 
person, whether government employee or private citizen, to take listed 
species.
    To comply with Section 7(a)(2) of the ESA, 16 U.S.C. 1536, for 
every action that FEMA proposes to carry out, fund, or authorize, FEMA 
must first determine if listed species and habitat are present in the 
action area. If species are present in the action area, then FEMA must 
make one of the following determinations with respect to the effect of 
the proposed action on listed species and critical habitat: (1) No 
Effect (NE); (2) may affect, but is not likely to adversely affect 
(NLAA); or (3) may affect and is likely to adversely affect (LAA).
    The purpose of the rule is to update FEMA's IHP regulations to 
reflect statutory changes that have already been implemented. The 
majority of the revisions in this rulemaking apply to the regulations 
for the IHP, which is a voluntary grant program that provides financial 
assistance and direct services to eligible individuals and households 
who have uninsured or underinsured necessary expenses and serious needs 
as a result of a Presidentially declared disaster. FEMA publishes this 
IFR amending its regulations governing the Individual Assistance 
program to increase equity by simplifying processes, removing barriers 
to entry, and increasing eligibility for certain types of assistance 
under the program. Specifically, the IFR increases eligibility for home 
repair assistance by amending the definitions and application of the 
terms safe, sanitary, and functional, allowing assistance for certain 
accessibility-related items, and amending its approach to evaluating 
insurance proceeds; allows for the re-opening of the applicant 
registration period when the President adds new counties to the major 
disaster declaration; simplifies the documentation requirements for 
continued temporary housing assistance; simplifies the appeals process; 
simplifies the process to request approval for a late registration; 
removes the requirement to apply for a Small Business Administration 
loan as a condition of eligibility for ONA; and establishes additional 
eligible assistance under ONA for serious needs, displacement, 
disaster-damaged computing devices and essential tools for self-
employed individuals. FEMA also makes revisions to reflect changes to 
statutory authority that have not yet been implemented in regulation, 
to include provisions for utility and security deposit payments, lease 
and repair of multifamily rental housing, child care assistance, 
maximum assistance limits, and waiver authority.
    This rule has been evaluated by FEMA and due to the administrative 
nature, FEMA has determined the rule does not have the potential to 
affect Federally listed species or designated critical habitat. As 
such, a ``No Effect'' determination has been made for these activities. 
Per the ESA regulations, notification to, and consultation with, the 
U.S. Fish and Wildlife Service and/or the National Marine Fisheries 
Service are not required for activities with a ``No Effect'' 
determination.

R. Congressional Review of Agency Rulemaking

    Under the Congressional Review of Agency Rulemaking Act (CRA), 5 
U.S.C. 801-808, before a rule can take effect, the Federal agency 
promulgating the rule must submit to Congress and to the GAO a copy of 
the rule; a concise general statement relating to the rule, including 
whether it is a major rule; the proposed effective date of the rule; a 
copy of any cost-benefit analysis; descriptions of the agency's actions 
under the RFA and the Unfunded Mandates Reform Act; and any other 
information or statements required by relevant Executive orders.
    FEMA has submitted this interim final rule to the Congress and to 
GAO pursuant to the CRA. OMB has determined that this rule is a ``major 
rule'' within the meaning of the CRA.

List of Subjects in 44 CFR Part 206

    Administrative practice and procedure, Coastal zone, Community 
facilities, Disaster assistance, Fire prevention, Grant programs--
housing and community development, Housing, Insurance, 
Intergovernmental relations, Loan programs--housing and community 
development, Natural resources, Penalties, Reporting and recordkeeping 
requirements.

    For the reasons stated in the preamble, the Federal Emergency 
Management Agency amends 44 CFR part 206 as follows:

PART 206--FEDERAL DISASTER ASSISTANCE

0
1. The authority citation for part 206 continues to read as follows:

    Authority:  Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, 42 U.S.C. 5121 through 5207; Homeland Security Act 
of 2002, 6 U.S.C. 101 et seq.; Department of Homeland Security 
Delegation 9001.1; sec. 1105, Pub. L. 113-2, 127 Stat. 43 (42 U.S.C. 
5189a note).

[[Page 4118]]

Subpart D--Federal Assistance to Individuals and Households


Sec.  206.101  [Removed and Reserved]

0
2. Remove and reserve Sec.  206.101.
0
3. Amend Sec.  206.110 by:
0
a. Revising the first sentence of paragraph (a), paragraphs (b), (c), 
(d), and (e);
0
b. Revising paragraph (h) introductory text;
0
c. Removing paragraph (h)(2), redesignating paragraphs (h)(3) and (4) 
as (h)(2) and (3), and revising newly redesignated paragraph (h)(3);
0
d. Revising paragraphs (i), (j)(2) introductory text, and (j)(2)(ii);
0
e. Revising the first sentence of paragraph (k)(2), the first sentence 
of paragraph (k)(3)(i) introductory text, and the first sentence of 
paragraph (k)(3)(i)(A);
0
f. Revising paragraph (m); and
0
g. Adding paragraph (n).
    The additions and revisions read as follows:


Sec.  206.110  Federal assistance to individuals and households.

    (a) Purpose. This section implements the policy and procedures set 
forth in the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, as amended (Stafford Act), 42 U.S.C. 5174. * * *
    (b) Maximum amount of assistance. No individual or household will 
receive financial assistance greater than $25,000 under this subpart 
with respect to a single major disaster or emergency for the repair or 
replacement of their pre-disaster primary residence. No individual or 
household will receive financial assistance greater than $25,000 under 
this subpart with respect to a single major disaster or emergency for 
Other Needs Assistance. FEMA will adjust the $25,000 limits annually to 
reflect changes in the Consumer Price Index (CPI) for All Urban 
Consumers that the Department of Labor publishes.
    (1) The maximum amount of financial assistance excludes rental 
assistance under Sec.  206.117(b)(1)(i) and lodging expense 
reimbursement under Sec.  206.117(b)(1)(i).
    (2) The maximum amount of financial assistance excludes expenses to 
repair or replace eligible damaged accessibility-related real property 
improvements and personal property for individuals with disabilities.
    (c) Multiple types of assistance. One or more types of housing 
assistance may be made available under this section to meet the needs 
of individuals and households in the particular disaster situation. 
FEMA will determine the appropriate types of housing assistance to be 
provided under this section based on considerations of cost 
effectiveness, convenience to the individuals and households and the 
suitability and availability of the types of assistance. An applicant 
is expected to accept the first offer of housing assistance; 
unwarranted refusal of assistance may result in the forfeiture of 
future housing assistance. Temporary housing and repair assistance must 
be utilized to the fullest extent practicable before other types of 
housing assistance.
    (d) Date of eligibility. Eligibility for Federal assistance under 
this subpart is limited to losses or expenses resulting from damage 
that occurred during the dates of the incident period established in a 
presidential declaration that a major disaster or emergency exists, 
except that reasonable lodging expenses that are incurred in 
anticipation of and immediately preceding such event may be eligible 
for Federal assistance under this chapter.
    (e) Period of assistance. FEMA may provide assistance under this 
subpart for a period not to exceed 18 months from the date of 
declaration. The Assistant Administrator for the Recovery Directorate 
may extend the period of assistance if he/she determines that due to 
extraordinary circumstances an extension would be in the public 
interest.
* * * * *
    (h) Duplication of benefits. In accordance with the requirements of 
the Stafford Act, 42 U.S.C. 5155, FEMA will not provide assistance 
under this subpart when any other source has already provided such 
assistance or when such assistance is available from any other source. 
In the instance of insured applicants, we will provide assistance under 
this subpart only when:
* * * * *
    (3) Applicants cannot use their insurance because there is no 
housing on the private market.
    (i) Cost sharing. (1) Except as provided in paragraph (i)(2) of 
this section, the Federal share of eligible costs paid under this 
subpart is 100 percent.
    (2) Federal and State cost shares for ``Other Needs'' assistance 
under the Stafford Act, 42 U.S.C. 5174(e) and (f), are as follows:
    (i) The Federal share is 75 percent; and
    (ii) The non-Federal share is 25 percent and must be paid from 
funds made available by the State. If the State does not provide the 
non-Federal share to FEMA before FEMA begins to provide assistance to 
individuals and households under the Stafford Act, 42 U.S.C. 5174(e), 
FEMA will still process applications. The State will then be obliged to 
reimburse FEMA for the non-Federal cost share of such assistance on a 
monthly basis. If the State does not provide such reimbursement on a 
monthly basis, then FEMA will issue a billing notice to the State on a 
monthly basis for the duration of the program. FEMA will charge 
interest, penalties, and administrative costs on delinquent billing 
notices in accordance with the Debt Collection Improvement Act. Cost 
shared funds, interest, penalties and administrative costs owed to FEMA 
through delinquent billing notices may be offset from other FEMA 
disaster assistance programs (i.e., Public Assistance) from which the 
State is receiving assistance, or future grant awards from FEMA or 
other Federal Agencies. Debt Collection procedures will be followed as 
outlined in 44 CFR part 11.
    (j) * * *
    (2) Under the Stafford Act, 42 U.S.C. 5174(f)(2), FEMA must share 
applicant information with States in order for the States to make 
available any additional State and local disaster assistance to 
individuals and households.
* * * * *
    (ii) States receiving such applicant information must not further 
disclose the information to other entities, and must not use it for 
purposes other than providing additional State or local disaster 
assistance to individuals and households.
    (k) * * *
    (2) Individuals or households that are located in a special flood 
hazard area may not receive Federal Assistance for National Flood 
Insurance Program (NFIP)--insurable real and/or personal property, 
damaged by a flood, unless the community in which the property is 
located is participating in the NFIP (See 44 CFR 59.1), or the 
exception in 42 U.S.C. 4105(d) applies. * * *
    (3) Flood insurance purchase requirement: (i) As a condition of the 
assistance and in order to receive any Federal assistance for future 
flood damage to any insurable property, individuals and households 
named by FEMA as eligible recipients under the Stafford Act, 42 U.S.C. 
5174, who receive assistance, due to flood damage, for acquisition or 
construction purposes under this subpart must buy and maintain flood 
insurance, as required in 42 U.S.C. 4012a, for at least the assistance 
amount. * * *
    (A) If the applicant is a homeowner, flood insurance coverage must 
be maintained at the address of the flood-

[[Page 4119]]

damaged property for as long as there is a residential building (See 44 
CFR 59.1) at the address. * * *
* * * * *
    (m) Historic preservation. Assistance provided under this subpart 
generally does not have the potential to affect historic properties and 
thus FEMA has no further obligations under the National Historic 
Preservation Act, 54 U.S.C. 306108, with the exception of ground 
disturbing activities and construction related to Sec. Sec.  
206.117(b)(1)(ii) (direct housing), 206.117(b)(2)(ii)(F) (repair 
assistance for privately owned roads and bridges), 206.117(b)(3) 
(replacement assistance), and 206.117(b)(4) (permanent housing 
construction).
    (n) Severability. Any provision of this subpart held to be invalid 
or unenforceable as applied to any person or circumstance should be 
construed so as to continue to give the maximum effect to the provision 
permitted by law, including as applied to persons not similarly 
situated or to dissimilar circumstances, unless such holding is that 
the provision of this subpart is invalid and unenforceable in all 
circumstances, in which event the provision should be severable from 
the remainder of this subpart and should not affect the remainder 
thereof.

0
4. Amend Sec.  206.111 by:
0
a. Revising the definitions of ``Alternative housing resources'' and 
``Dependent'';
0
b. Adding the definition of ``Destroyed'';
0
c. Revising the definitions of ``Displaced applicant'' and ``Eligible 
hazard mitigation measures'';
0
d. Adding the definition of ``Essential tools'';
0
e. Revising the definitions of ``Fair market rent'' and ``Financial 
ability'';
0
f. Removing the definition of ``Functional'';
0
g. Adding the definition of ``Functioning'';
0
h. Revising the definition of ``Housing costs'';
0
i. In the definition of ``Manufactured housing sites,'' revise the 
introductory text and paragraph (3);
0
j. Revising the definitions of ``Owner-occupied'', ``Permanent housing 
plan'' and ``Reasonable commuting distance'';
0
k. Adding the definitions of ``Recertification'' and ``Repairs'';
0
l. Revising the definitions of ``Safe'', ``Sanitary'', and ``Serious 
need'';
0
m. Adding the definition of ``State''; and
0
n. Revising the definition of ``Uninhabitable''.
    The additions and revisions to read as follows:


Sec.  206.111  Definitions.

* * * * *
    Alternative housing resources means any housing that is available 
or can quickly be made available in lieu of permanent housing 
construction and is cost-effective when compared to permanent 
construction costs. Some examples are rental resources, manufactured 
housing units, and travel trailers.
* * * * *
    Dependent means someone who is normally claimed as such on the 
Federal tax return of another, according to the Internal Revenue Code. 
It may also mean the minor children of a couple not living together, 
where the children live in the affected residence with the parent or 
guardian who does not claim them on the tax return.
    Destroyed means the primary residence is a total loss or damaged to 
such an extent that repairs are infeasible.
    Displaced applicant means one whose disaster-damaged primary 
residence is uninhabitable, inaccessible, or made unavailable by the 
landlord.
* * * * *
    Eligible hazard mitigation measures are home improvements that an 
applicant can accomplish in order to reduce or prevent future disaster 
damage to the primary residence, utilities, or infrastructure.
    Essential tools means tools and equipment required for employment 
and items required for education.
    Fair market rent means estimates of rent plus the cost of 
utilities, except telephone, identified by the Department of Housing 
and Urban Development as being adequate for existing rental housing in 
a particular geographic area.
    Financial ability means the applicant's capability to pay 30 
percent of gross post-disaster household income for housing. When 
computing financial ability, extreme or unusual financial circumstances 
may be considered by FEMA.
* * * * *
    Functioning means an item or home capable of being used for its 
intended purpose.
* * * * *
    Housing costs means rent and mortgage payments, including 
principal, interest, real estate taxes, real property insurance, 
homeowners or condominium association fees, and utility costs.
* * * * *
    Manufactured housing sites means those sites used for the placement 
of travel trailers and other manufactured housing units, including:
* * * * *
    (3) Group site, a site provided by the State or local government or 
FEMA, if determined that such site would be more economical or 
accessible than one that the State or local government provides, that 
accommodates two or more units and is complete with utilities.
* * * * *
    Owner-occupied means that the residence is occupied by:
    (1) The legal owner with verifiable documentation; or
    (2) A person who does not hold formal title to the residence and 
pays no rent, but can produce verifiable documentation demonstrative of 
legal responsibility including tax payment receipts; receipts for major 
repairs, maintenance, or improvements of the residence; court 
documents, a letter from a public official, or, for mobile home or 
travel trailer owners residing in a commercial park, a letter from the 
mobile home park owner or manager; or
    (3) A person who has verifiable documentation of lifetime occupancy 
rights with formal title vested in another.
    Permanent housing plan means a realistic plan that, within a 
reasonable timeframe, puts the displaced applicant back into permanent 
housing that is similar to their pre-disaster housing situation. A 
reasonable timeframe includes sufficient time within the period of 
assistance for securing funds and services to repair the home, 
completing repairs or locating a permanent dwelling, and moving into 
the dwelling.
* * * * *
    Reasonable commuting distance means a distance that does not place 
undue hardship on an applicant. It also takes into consideration the 
traveling time involved due to road conditions, e.g., mountainous 
regions or road closures and the normal commuting patterns of the area.
    Recertification means the process that FEMA uses to evaluate an 
applicant's eligibility for continued temporary housing assistance 
under Sec.  206.114.
    Repairs means repairs of a quality necessary for a safe and 
sanitary living or functioning condition.
    Safe means secure from hazards or threats to occupants.
    Sanitary means free of health hazards.
    Serious need means the requirement for an item, or service, that is 
necessary to an applicant's ability to prevent,

[[Page 4120]]

mitigate, or overcome a disaster-related hardship, injury or adverse 
condition.
* * * * *
    State means, for the purposes of this subpart and where consistent 
with the requirements of the Stafford Act, any State as defined in 
Sec.  206.2(a)(22) or Indian tribal government as defined in the 
Stafford Act (42 U.S.C. 5122(6)).
    Uninhabitable means the dwelling is not safe or sanitary.
* * * * *

0
5. Amend Sec.  206.112 by:
0
a. Revising paragraph (b);
0
b. Redesignating paragraph (c) as paragraph (d) and adding a new 
paragraph (c); and
0
c. Revising the second sentence of newly redesignated paragraph (d).
    The additions and revisions read as follows:


Sec.  206.112  Registration period.

* * * * *
    (b) Extension of the registration period. FEMA may extend the 
registration period when the State requests more time to collect 
registrations from the affected population. FEMA may also extend the 
standard registration period when necessary to establish the same 
registration deadline for contiguous counties or States.
    (c) Reopening of the registration period. After the registration 
period for the major disaster or emergency has expired, FEMA may reopen 
the registration period for 60 days only when the President's 
declaration is amended to include additional counties and only for the 
additional counties.
    (d) Late registrations. * * * We will process late registrations 
for those registrants who explain the reason for the delay in their 
registration.

0
6. Amend Sec.  206.113 by:
0
a. Revising paragraphs (a) introductory text and (a)(1);
0
b. Removing paragraph (a)(4) and redesignating paragraphs (a)(5) 
through (a)(9) as paragraphs (a)(4) through (a)(8), respectively;
0
c. Revising newly redesignated paragraphs (a)(4), (5), (7), and (8) and 
adding paragraph (9);
0
d. Revising paragraphs (b)(1) through (5), (9) and (10).
    The addition and revisions read as follows:


Sec.  206.113  Eligibility factors.

    (a) Conditions of eligibility. In general, FEMA may provide 
assistance to individuals and households who qualify for such 
assistance under the Stafford Act, 42 U.S.C. 5174, and this subpart. 
FEMA may only provide assistance:
    (1) When the individual or household has incurred a disaster-
related necessary expense and serious need in the State in which the 
disaster has been declared, without regard to their residency in that 
State;
* * * * *
    (4) In a situation where the applicant has insurance, but the 
applicant cannot use their insurance because housing is not available 
on the private market;
    (5) In a situation where the applicant has insurance, when the 
insured individual or household has accepted all assistance from other 
sources for which he, she, or they are eligible, including insurance, 
and that assistance and insurance is insufficient to cover the 
necessary expense and serious need;
* * * * *
    (7) With respect to housing assistance, if the primary residence 
has been destroyed, is uninhabitable, or is inaccessible;
    (8) With respect to housing assistance, if a renter's primary 
residence is no longer available as a result of the disaster; and
    (9) With respect to home repair for accessibility-related items, if 
an applicant meets the following conditions:
    (i) The applicant is either an individual with a disability as 
defined in 42 U.S.C. 5122 whose disability existed prior to the 
disaster and whose primary residence was damaged by the disaster, or an 
individual with a disability as defined in 42 U.S.C. 5122 whose 
disability was caused by the disaster and whose primary residence was 
damaged by the disaster;
    (ii) The real property component is necessary to meet the 
accessibility-related need of the household; and
    (iii) The real property component is not covered by insurance or 
any other source.
    (b) * * *
    (1) For housing or displacement assistance, to individuals or 
households who are displaced from other than their pre-disaster primary 
residence;
    (2) For temporary housing or displacement assistance, to 
individuals or households who have adequate rent-free housing 
accommodations;
    (3) For temporary housing or displacement assistance, to 
individuals or households who own a secondary or vacation residence 
within reasonable commuting distance to the disaster area, or who own 
available rental property that meets their temporary housing needs;
    (4) For temporary housing or displacement assistance to individuals 
or households who evacuated the residence in response to official 
warnings solely as a precautionary measure and are able to return to 
and safely occupy the residence immediately after the incident;
    (5) For housing assistance, for improvements or additions to the 
pre-disaster condition of property, except for the following:
    (i) Improvements or additions required to make repairs that comply 
with local and State ordinances;
    (ii) Eligible hazard mitigation measures; or
    (iii) Accessibility-related items for individuals with 
disabilities, consistent with paragraph (a)(9) of this section;
* * * * *
    (9) For business losses, including farm businesses; or
    (10) For any items not otherwise authorized by Sec. Sec.  206.117 
and 206.119.

0
7. Revise Sec.  206.114 to read as follows:


Sec.  206.114  Criteria for continued or additional assistance.

    (a) General. FEMA expects all recipients of assistance under this 
subpart to obtain and occupy permanent housing at the earliest possible 
time. FEMA may provide initial and continued temporary housing 
assistance, financial or direct, upon request during the period of 
assistance, based on need, and generally only when adequate, alternate 
housing is not available or when the permanent housing plan has not 
been fulfilled through no fault of the applicant.
    (b) Rental assistance. FEMA may provide initial financial 
assistance for rent, also known as initial rental assistance, as 
described in Sec.  206.117(b)(1)(i), to displaced eligible applicants 
to rent alternate housing accommodations for an initial time period 
established by FEMA.
    (1) FEMA may periodically recertify all displaced applicants who 
received initial rental assistance and request continued rental 
assistance. All displaced applicants requesting continued rental 
assistance must take the following actions at certain points throughout 
the recertification process:
    (i) Submit rent receipts to show that they have exhausted or will 
exhaust previously provided funds;
    (ii) Provide documentation demonstrating they lack the financial 
ability to pay their post-disaster housing costs and have a continued 
need for rental assistance;
    (iii) Establish a realistic permanent housing plan; and
    (iv) Provide documentation showing that they are making efforts to 
obtain permanent housing.

[[Page 4121]]

    (2) FEMA expects that pre-disaster renters will use their initial 
rental assistance to obtain permanent housing. However, FEMA may 
provide continued rental assistance to pre-disaster renters with a 
continuing disaster-related housing need.
    (c) Direct housing assistance. FEMA may provide direct housing 
assistance as described in Sec.  206.117(b)(1)(ii), to displaced 
eligible applicants who are unable to make use of financial assistance 
to rent adequate alternate housing. FEMA may periodically recertify all 
displaced applicants receiving direct housing assistance for continued 
direct housing assistance. All displaced applicants who need continued 
direct housing assistance must take the following actions at certain 
points throughout the recertification process:
    (1) Establish a realistic permanent housing plan; and
    (2) Provide documentation showing that they are making efforts to 
obtain permanent housing throughout the recertification process.
    (d) Other assistance. FEMA may provide repairs or housing 
replacement assistance, as described in Sec.  206.117(b)(2) and Sec.  
206.117(b)(3), lodging expense reimbursement, as described in Sec.  
206.117(b)(1)(i), or other needs assistance, as described in Sec.  
206.119, to eligible applicants.
    (1) If FEMA requires more information to process an applicant's 
initial request for assistance, it may request additional information.
    (2) After the initial award of assistance, applicants requesting 
additional assistance for repairs, housing replacement, lodging expense 
reimbursement, personal property, transportation, child care, medical, 
dental, funeral, moving and storage, or other necessary expenses and 
serious needs may submit an appeal as outlined in Sec.  206.115 and 
will be required to submit information and/or verifiable documentation 
established via guidance identifying the additional need.

0
8. Amend Sec.  206.115 by:
0
a. Revising the first sentence of paragraph (a) introductory text;
0
b. Revising paragraphs (b) and (c) and the second sentence of paragraph 
(d);
0
c. Removing paragraph (e); and
0
f. Redesignating paragraph (f) as paragraph (e) and revising newly 
redesignated paragraph (e).
    The revisions read as follows:


Sec.  206.115  Appeals.

    (a) Under the provisions of the Stafford Act, 42 U.S.C. 5189a, 
applicants for assistance under this subpart may appeal any 
determination of eligibility for assistance made under this subpart. * 
* *
* * * * *
    (b) Appeals must include a written explanation or verifiable 
documentation for the appeal and meet the requirements of Sec.  
206.117, as applicable. See Sec. Sec.  206.117(b)(2)(vi), 
206.117(b)(3)(iv), and 206.117(b)(4)(iii). If someone other than the 
applicant files the appeal, then the applicant must also submit a 
signed statement giving that person authority to represent them. If a 
written explanation is submitted, it must be signed by the applicant or 
a person the applicant designates to represent them.
    (c) Applicants must appeal to FEMA for decisions made under this 
subpart, unless FEMA has made a grant to the State to provide 
assistance to individuals and households under Sec.  206.120(a), State 
administration of other needs assistance; then the applicant must 
appeal to the State.
    (d) * * * If someone other than the applicant is submitting the 
request, then the applicant must also submit a signed statement giving 
that person authority to represent them.
    (e) FEMA or the appropriate State official will review the original 
decision after receiving the appeal. FEMA or the State, as appropriate, 
will give the appellant a written notice of the disposition of the 
appeal and a reason for the determination within 90 days of receiving 
the appeal. The decision of the FEMA or State appellate authority is 
final.

0
9. Amend Sec.  206.117 by:
0
a. In paragraph (a):
0
i. Removing the definition of ``Caused by the disaster'';
0
ii. Adding the definition of ``Multifamily Rental Housing''; and
0
iii. Revising the definition of ````Real Property Component'' or 
``Component'''';
0
b. Revising paragraphs (b)(1)(i), (b)(1)(ii)(A) through (C) and (E);
0
c. Redesignating paragraphs (b)(1)(ii)(F) through (I) as paragraphs 
(b)(1)(ii)(G) through (J), respectively, and adding a new paragraph 
(F);
0
d. Revising the first sentence of newly redesignated paragraph 
(b)(1)(ii)(G), paragraph (b)(1)(ii)(H)(4), and the second sentence of 
newly redesignated paragraph (b)(1)(ii)(I);
0
e. Revising paragraphs (b)(2)(i), (b)(2)(ii) introductory text, 
(b)(2)(ii)(H), and (b)(2)(iii);
0
f. Removing paragraph (b)(2)(iv) and redesignating paragraphs (b)(2)(v) 
through (vii) as paragraphs (b)(2)(iv) through (vi);
0
g. Revising newly redesignated paragraphs (b)(2)(iv) and (b)(2)(vi);
0
h. Revising paragraphs (b)(3) and (b)(4)(i)(A);
0
i. Removing paragraph (b)(4)(i)(B) and redesignating paragraphs (C) 
through (F) as paragraphs (B) through (E); and
0
j. Revising newly redesignated paragraph (b)(4)(i)(E) and the first two 
sentences of (b)(4)(iii).
    The additions and revisions read as follows:


Sec.  206.117  Housing assistance.

    (a) * * *
    ``Multifamily Rental Housing'' means a rental property that 
contains three or more dwelling units contained within one building, 
each such unit providing complete and independent living facilities for 
one or more persons, including permanent provisions for living, 
sleeping, cooking, and sanitation.
    ``Real Property Component'' or ``Component'' means each individual 
part of a dwelling as enumerated in paragraph (b)(2)(ii) of this 
section.
* * * * *
    (b) Types of housing assistance--(1) Temporary housing assistance--
(i) Rental assistance. Eligible displaced applicants may receive rental 
assistance to rent alternate housing resources. FEMA may also provide 
assistance for the reasonable cost of any transportation, utility 
hookups, or installation of a manufactured housing unit or recreational 
vehicle to be used for housing. This may include lodging expense 
reimbursement for reasonable short-term lodging expenses for 
individuals or households who have not received displacement assistance 
(See Sec.  206.119(b)(2)) in the immediate aftermath of a disaster.
    (A) FEMA will include all members of a pre-disaster household in a 
single registration and will provide assistance for one temporary 
housing residence, unless FEMA determines that the size or nature of 
the household requires that we provide assistance for more than one 
residence.
    (B) FEMA will base the amount of assistance on the current fair 
market rent for existing rental units. FEMA will further base the 
applicable rate on the location of the rental unit and the number of 
bedrooms the household requires, as determined by FEMA.
    (C) Rental assistance may include the payment of the cost of 
utilities, excluding telephone, cable, television, and internet 
service.
    (D) Rental assistance may include the payment of the cost of 
security deposits, not to exceed an amount equal to the fair market 
rent for one month, as determined under paragraph (b)(1)(i)(B) of this 
section.

[[Page 4122]]

    (E) Applicants that receive displacement assistance under Sec.  
206.119(b)(2) must request rental assistance if their disaster-caused 
temporary housing needs continue once displacement assistance is 
exhausted.
    (ii) Direct assistance. (A) FEMA may provide direct assistance in 
the form of purchased or leased temporary housing units directly to 
displaced applicants who lack available housing resources and are 
unable to make use of the assistance provided under paragraph (b)(1)(i) 
of this section.
    (B) FEMA will include all members of a pre-disaster household in a 
single application and will provide assistance for one temporary 
housing unit, unless FEMA determines that the size or nature of the 
household requires that we provide assistance for more than one 
temporary housing unit.
    (C) Any site upon which a FEMA-provided temporary housing unit is 
placed must comply with applicable State and local codes and 
ordinances, as well as 44 CFR part 9, Floodplain Management and 
Protection of Wetlands, and all other applicable environmental and 
historic preservation laws, regulations, Executive orders, and agency 
policy.
* * * * *
    (E) FEMA-provided or funded temporary housing units may be placed 
in the following locations:
    (1) A commercial site that is complete with utilities, when FEMA 
determines that the upgrading of commercial sites, or installation of 
utilities on such sites, will provide more cost-effective, timely and 
suitable temporary housing than other types of resources.
    (2) A private site that an applicant provides, complete with 
utilities, when FEMA determines that the cost of installation or 
repairs of essential utilities on private sites will provide more cost 
effective, timely, and suitable temporary housing than other types of 
resources.
    (3) A group site that accommodates two or more temporary housing 
units and is complete with utilities, provided by the State or local 
government, when FEMA determines that the cost of developing a group 
site provided by the State or local government, to include installation 
or repairs of essential utilities on the sites, will provide more cost 
effective, timely, and suitable temporary housing than other types of 
resources.
    (4) A group site provided by FEMA, if determined that such a site 
would be more economical or accessible than one that the State or local 
government provides.
    (F) If FEMA determines it would be a cost-effective alternative to 
other temporary housing options, FEMA may enter into lease agreements 
with owners of multifamily rental housing properties to house displaced 
applicants eligible for assistance under this subpart.
    (1) FEMA may only enter into lease agreements with owners of 
multifamily rental housing properties impacted by a major disaster or 
located in areas covered by a major disaster declaration.
    (2) FEMA may make repairs or improvements to properties under such 
lease agreements, to the extent necessary to serve as temporary 
housing, provided, however, that the value of the improvements or 
repairs must be deducted from the value of the lease agreement.
    (G) After the end of the 18-month period of assistance, FEMA may 
begin to charge up to the fair market rent for each temporary housing 
unit provided. * * *
    (H) * * *
    (4) The occupant(s) failed to comply with any term of the lease/
rental agreement or other rules of the site where the temporary housing 
unit is located; or
* * * * *
    (I) * * * This notice will specify the reasons for termination of 
assistance and occupancy, the date of termination, the procedure for 
appealing the determination, and the occupant's liability for such 
additional charges as FEMA deems appropriate after the termination 
date, including fair market rent for the unit.
* * * * *
    (2) Repairs. (i) FEMA may provide financial assistance for the 
repair of an owner-occupied primary residence if:
    (A) The eligibility criteria in Sec.  206.113 are met;
    (B) FEMA determines the dwelling was damaged by the disaster; and,
    (C) The damage is not covered by insurance.
    (ii) FEMA may provide financial assistance for the repair of the 
disaster damaged dwelling to a safe and sanitary living or functioning 
condition including:
* * * * *
    (H) Eligible hazard mitigation measures.
    (iii) FEMA financial assistance for the repair of disaster damage 
will be limited to repairs of a quality necessary for a safe and 
sanitary living or functioning condition. In some instances, when the 
extent of the damage is unclear, FEMA may provide assistance for the 
average cost of a licensed technician's professional assessment. FEMA 
may provide for the replacement of a component if repair is not 
feasible.
    (iv) Eligible individuals or households may receive up to the 
maximum amount of assistance (See Sec.  206.110(b)) to repair damage to 
their primary residence irrespective of other financial resources, 
except insurance proceeds.
* * * * *
    (vi) If the applicant disputes a determination made by FEMA 
regarding eligibility for repair assistance, the applicant may appeal 
that determination pursuant to the procedures in Sec.  206.115. In 
addition to the requirements in Sec.  206.115, the applicant must 
provide proof that the component meets the requirements of paragraph 
(b)(2)(i) of this section. If the applicant disputes the amount of 
repair assistance awarded, the applicant must also provide 
justification for the amount sought.
    (3) Housing replacement. (i) FEMA may provide financial assistance 
for the replacement of an owner-occupied primary residence if:
    (A) The eligibility criteria in Sec.  206.113 are met;
    (B) The residence was destroyed by the disaster; and
    (C) The damage to the residence is not covered by insurance.
    (ii) If replacement assistance is granted, the applicant may either 
use the maximum amount of assistance (See Sec.  206.110(b)) to replace 
the dwelling in its entirety, or may use the assistance toward the cost 
of acquiring a new permanent residence.
    (iii) Housing replacement assistance will be based on the average 
replacement cost established by FEMA for the type of residence 
destroyed, or the statutory maximum (See Sec.  206.110(b)), whichever 
is less.
    (iv) If the applicant disputes a determination made by FEMA 
regarding eligibility for replacement assistance, the applicant may 
appeal that determination pursuant to the procedures in Sec.  206.115. 
In addition to the requirements in Sec.  206.115, the applicant must 
provide proof that repair is not feasible, or will not ensure the 
safety or health of the occupant. If the applicant disputes the amount 
of replacement assistance awarded, the applicant must also provide 
justification for the amount sought.
    (4) * * *
    (i) * * *
    (A) The eligibility criteria in Sec.  206.113 are met;
* * * * *
    (E) The residence is in a location where alternative housing 
resources are not available and the types of financial

[[Page 4123]]

or direct temporary housing assistance described in paragraphs (b)(1), 
(2), and (3) of this section are unavailable, infeasible, or not cost-
effective.
* * * * *
    (iii) If the applicant disputes a determination made by FEMA 
regarding eligibility for construction assistance, the applicant may 
appeal that determination pursuant to the procedures in Sec.  206.115. 
In addition to the requirements in Sec.  206.115, the applicant must 
provide proof that the property is in a location where alternative 
housing resources are not available. * * *

0
10. Revise Sec.  206.118 to read as follows:


Sec.  206.118  Disposal of housing units.

    (a) FEMA may sell temporary housing units purchased under Sec.  
206.117(b)(1)(ii), Temporary housing, direct assistance, as follows:
    (1) Sale to an occupant. (i) FEMA may sell a temporary housing unit 
to the occupant, if they lack permanent housing and have a site that 
complies with local codes and ordinances and part 9 of this Title.
    (ii) FEMA may approve adjustments to the sales price when selling a 
temporary housing unit to the occupant if the occupant is unable to pay 
the fair market value of the temporary housing unit and when doing so 
is in the best interest of the occupant and FEMA.
    (iii) FEMA may sell a temporary housing unit to the occupant only 
on the condition that the purchaser agrees to obtain and maintain 
hazard insurance, as well as flood insurance on the temporary housing 
unit if it is or will be in a designated Special Flood Hazard Area.
    (2) Other methods of disposal. (i) FEMA may sell, transfer, donate, 
or otherwise make a temporary housing unit available directly to a 
State or other governmental entity, or to a voluntary organization, for 
the sole purpose of providing temporary housing to eligible displaced 
applicants in major disasters and emergencies. As a condition of the 
sale, transfer, or donation, or other method of provision, the State, 
governmental entity, or voluntary organization must agree to:
    (A) Comply with the nondiscrimination provisions of the Stafford 
Act, 42 U.S.C. 5151; and
    (B) Obtain and maintain hazard insurance on the temporary housing 
unit, as well as flood insurance if the housing unit is or will be in a 
designated Special Flood Hazard Area.
    (ii) FEMA may also sell temporary housing units at a fair market 
value to any other person.
    (b) A temporary housing unit will be sold ``as is, where is'', 
except for repairs FEMA deems necessary to protect health or safety, 
which are to be completed before the sale. There will be no implied 
warranties. In addition, FEMA will inform the purchaser that they may 
have to bring the installation of the temporary housing unit up to 
codes and standards that are applicable at the proposed site.

0
11. Revise Sec.  206.119 to read as follows:


Sec.  206.119  Financial assistance to address other needs.

    (a) Purpose. FEMA and the State may provide financial assistance to 
individuals and households who are adversely affected by a major 
disaster and have other verifiable, documented disaster-related 
necessary expenses or serious needs.
    (b) Types of assistance. (1) Serious needs. Necessary expenses to 
assist applicants who report they are displaced as a result of the 
disaster, who report a need for shelter as a result of the disaster, or 
who have other emergency disaster expenses. These needs will vary 
according to each applicant and FEMA will not require receipts 
documenting the use of this assistance. FEMA will adjust the amount of 
this assistance to reflect changes in the CPI for all Urban Consumers 
that the Department of Labor publishes.
    (2) Displacement. Necessary expenses to assist displaced applicants 
with short-term living arrangements immediately following a disaster. 
Applicants must have registered within the 60-day or extended 
registration period. The award amount is based on a time period 
established by FEMA and approved in the State Administrative Option, as 
required by Sec.  206.120(b). FEMA will not require receipts 
documenting the use of this assistance.
    (3) Medical and dental. Necessary expenses to assist applicants 
with medical and dental costs, which may include the following:
    (i) Medical service costs;
    (ii) Dental service costs;
    (iii) Repair or replacement of medical or dental equipment;
    (iv) Loss or injury of a service animal; and
    (v) Costs for prescription medicines related to eligible medical or 
dental services, or which need to be replaced due to the disaster.
    (4) Child care. Necessary expenses to assist applicants with child 
care costs, which may include the following:
    (i) Standard child care service fees, including personal assistance 
services that support activities of daily living for children with 
disabilities; and
    (ii) Registration and health inventory fees for applicants who 
require a new child care provider.
    (5) Funeral. Necessary expenses to assist applicants with funeral 
costs, which may include the following:
    (i) Funeral services;
    (ii) Burial or cremation; and
    (iii) Other related funeral expenses.
    (6) Personal property. Necessary expenses to assist applicants 
whose primary residences were damaged by the disaster with personal 
property costs, which may include the following:
    (i) Clothing;
    (ii) Household items, furnishings or appliances;
    (iii) Computing devices;
    (iv) Essential tools, specialized or protective clothing, computing 
devices, and equipment required for employment;
    (v) Computing devices, uniforms, schoolbooks and supplies required 
for educational purposes; and
    (vi) Cleaning or sanitizing any eligible personal property item.
    (7) Transportation. Necessary expenses to assist applicants with 
transportation costs, which may include the following:
    (i) Repairing or replacing vehicles;
    (ii) Public transportation; and
    (iii) Other transportation related costs or services.
    (8) Moving and storage. Necessary expenses to assist applicants 
whose primary residences were damaged by the disaster with costs 
related to moving and storing personal property, which may include the 
following:
    (i) Moving and storing personal property to avoid additional 
disaster damage;
    (ii) Storage of personal property while disaster-related repairs 
are being made to the primary residence; and
    (iii) Return of the personal property to the individual or 
household's primary residence.
    (9) Group Flood Insurance purchase. Individuals identified by FEMA 
as eligible for assistance for flood insurable damage under the 
Stafford Act, 42 U.S.C. 5174, as a result of flood damage caused by a 
Presidentially-declared major disaster and who reside in a special 
flood hazard area (SFHA) may be included in a Group Flood Insurance 
Policy (GFIP) established under the National Flood Insurance Program 
(NFIP) regulations at 44 CFR 61.17.
    (i) The premium for the GFIP is a necessary expense within the 
meaning of this section. FEMA or the State must withhold this portion 
of the Other Needs award and provide it to the NFIP

[[Page 4124]]

on behalf of individuals and households who are eligible for coverage. 
The coverage must be equivalent to the maximum assistance amount 
established under the Stafford Act, 42 U.S.C. 5174.
    (ii) FEMA or the State IHP staff must provide the NFIP with records 
of individuals who received assistance for flood-insurable losses 
within a SFHA and are to be insured through the GFIP. Records of 
applicants to be insured must be accompanied by payments to cover the 
premium amounts for each applicant for the 3-year policy term. The NFIP 
will then issue a Certificate of Flood Insurance to each applicant. 
Flood insurance coverage becomes effective on the 30th day following 
the receipt of records of GFIP insureds and their premium payments from 
the State or FEMA, and such coverage terminates 36 months from the 
inception date of the GFIP, which is 60 days from the date of the 
disaster declaration.
    (iii) Insured applicants would not be covered if they are 
determined to be ineligible for coverage based on a number of 
exclusions established by the NFIP. Therefore, once applicants/
policyholders receive the Certificate of Flood Insurance that contains 
a list of the policy exclusions, they should review that list to see if 
they are ineligible for coverage. Those applicants who fail to do this 
may find that their property is, in fact, not covered by the insurance 
policy when the next flooding incident occurs and they file for losses. 
Once the applicants find that their damaged buildings, contents, or 
both, are ineligible for coverage, they should notify the NFIP in 
writing in order to have their names removed from the GFIP, and to have 
the flood insurance maintenance requirement expunged from the data-
tracking system.
    (10) Miscellaneous. Other miscellaneous items or services that 
FEMA, in consultation with the State, determines are necessary expenses 
and serious needs.

Subpart E--[Removed and Reserved]

0
12. Remove and reserve Subpart E, consisting of Sec. Sec.  206.131 
through 206.140.

Subpart F--Other Individual Assistance

0
13. Amend Sec.  206.191 by:
0
a. Revising paragraphs (a), (b)(1), (d)(2)(ii) through (iv);
0
b. Revising the first sentence of paragraph (d)(4) introductory text 
and paragraph (d)(4)(ii);
0
c. Revising paragraph (e)(1)(i), (e)(2) introductory text, the second 
sentence of (e)(2)(iii), (e)(3) through (5) and paragraph (f); and
0
e. Adding paragraph (g).
    The addition and revisions read as follows.


Sec.  206.191  Duplication of benefits.

    (a) Purpose. This section establishes the policies for implementing 
the Stafford Act, 42 U.S.C. 5155, entitled Duplication of Benefits. 
This section relates to assistance for individuals and families.
    (b) * * *
    (1) Federal agencies providing disaster assistance under the Act or 
under their own authorities triggered by the Act, must cooperate to 
prevent and rectify duplication of benefits, according to the general 
policy guidance of the Federal Emergency Management Agency. The 
agencies must establish appropriate agency policies and procedures to 
prevent duplication of benefits.
* * * * *
    (d) * * *
    (2) * * *
    (ii) Housing assistance pursuant to the Stafford Act, 42 U.S.C. 
5174;
    (iii) Other Needs assistance, pursuant to the Stafford Act, 42 
U.S.C. 5174;
    (iv) Small Business Administration and Department of Agriculture 
disaster loans;
* * * * *
    (4) If following the delivery sequence concept would adversely 
affect the timely receipt of essential assistance by an individual or 
household, an agency may offer assistance which is the primary 
responsibility of another agency. * * *
* * * * *
    (ii) In the case where the individual or household has refused 
assistance from Agency A, Agency A must notify Agency B that it must 
recover assistance previously provided.
    (e) * * *
    (1) * * *
    (i) In making an eligibility determination, FEMA, in the case of 
federally operated programs, or the State, in the case of State 
operated programs, must determine whether assistance is the primary 
responsibility of another agency to provide, according to the delivery 
sequence; and determine whether that primary response agency can 
provide assistance in a timely way.
* * * * *
    (2) Programs under the Act vs. insurance. In making an eligibility 
determination, FEMA or the State must:
* * * * *
    (iii) * * * Where flood insurance is involved, FEMA must coordinate 
with the Federal Insurance Administration. * * *
    (3) Random sample. Each disaster assistance agency is responsible 
for preventing and rectifying duplication of benefits under the general 
authority of the Stafford Act, 42 U.S.C. 5155. To determine whether 
duplication has occurred and established procedures have been followed, 
FEMA must, within 90 days after the close of the disaster assistance 
program's application period, for selected disaster declarations, 
examine on a random sample basis, FEMA's and other government and 
voluntary agencies' case files and document the findings in writing.
    (4) Duplication when assistance under the Act is involved. If 
duplication is discovered, FEMA must determine whether the duplicating 
agency followed its own remedial procedures.
    (i) If the duplicating agency followed its procedures and was 
successful in correcting the duplication, FEMA will take no further 
action. If the agency was not successful in correcting the duplication, 
and FEMA is satisfied that the duplicating agency followed its remedial 
procedures, no further action will be taken.
    (ii) If the duplicating agency did not follow its duplication of 
benefits procedures, or FEMA is not satisfied that the procedures were 
followed in an acceptable manner, then FEMA must provide an opportunity 
for the agency to take the required corrective action. If the agency 
cannot fulfill its responsibilities for remedial action, FEMA must 
notify the recipient of the excess assistance, and after examining the 
debt, then as appropriate, take those recovery actions in conjunction 
with agency representatives for each identified case in the random 
sample (or larger universe, at FEMA's discretion).
    (5) Duplication when assistance under other authorities is 
involved. When the random sample shows evidence that duplication has 
occurred and corrective action is required, FEMA must urge the 
duplicating agency to follow its own procedures to take corrective 
action, and must work with the agency toward that end. Under its 
authority in the Stafford Act, 42 U.S.C. 5155, FEMA must require the 
duplicating agency to report to FEMA on the agency's attempt to correct 
the duplications identified in the sample.
    (f) Recovering FEMA funds: debt collection. Funds due to FEMA are 
recovered in accordance with the Department of Homeland Security's Debt 
Collection Regulations (6 CFR part 11--Claims) and the Federal Claims 
Collection Standards (Department of the Treasury--Department of 
Justice) (31

[[Page 4125]]

CFR chapter IX). Section 1216 of the Disaster Recovery Reform Act of 
2018, 42 U.S.C. 5174a, also provides FEMA the authority to waive debts 
owed by individuals and households who received assistance under 
subpart D of this part.
    (g) Severability. Any provision of this section held to be invalid 
or unenforceable as applied to any person or circumstance should be 
construed so as to continue to give the maximum effect to the provision 
permitted by law, including as applied to persons not similarly 
situated or to dissimilar circumstances, unless such holding is that 
the provision of this section is invalid and unenforceable in all 
circumstances, in which event the provision should be severable from 
the remainder of this section and should not affect the remainder 
thereof.

Deanne Criswell,
Administrator, Federal Emergency Management Agency.
[FR Doc. 2024-00677 Filed 1-19-24; 8:45 am]
BILLING CODE 9111-24-P