What FEMA's dwindling funds mean for the next disaster

• FEMA could face ~$2 billion deficit in disaster relief fund
• Increased disasters loom with storm season
• Costs could fall to states, localities

RICHMOND, Virginia - After Saint Ann and the St. Louis area in Missouri suffered major flooding in 2022, Beth Gutzler got assistance from the Federal Emergency Management Agency (FEMA) – something that sticks in her mind to this day.

"Basements were flooded. I hate to say that that's normal, but it is," she said.

"FEMA was the first person that I called," she said. "I have this memory of having emergency funds in my account within a week. I just have this memory of how it's supposed to be."

Now, Gutzler is struggling to get even a response to help with damages from a tornado that swept through the St. Louis area in March, including her new community of Florissant, and others in the state are seeking help after another tornado blew through the area in May.

"There was absolutely no response from FEMA until weeks and weeks later," she said. "I would assume it's administration and their capacity."

Having experience with customer service, she added, "I know what you're taught to do if people call and you can't have answers for them. You're taught to just delay."

With the Atlantic hurricane season underway in the eastern U.S. and as officials grapple with the deadly Texas floods, FEMA is faced with competition for its resources on top of across-the-board federal government staffing cuts.

Experts worry there simply is not enough funding and personnel to go around when the next disaster hits.

"We know this is going to be an active Atlantic hurricane season," said Shana Udvardy, senior climate resilience policy analyst with the Union of Concerned Scientists, a non-profit group.

"All we need is one big hurricane, and we're going to probably be in 'immediate needs' funding," she said, referring to a special designation when disaster funds run low.

Disaster relief fund

President Donald Trump announced a major disaster declaration in the wake of the Texas floods this month, a designation that allows public entities and local residents to apply for assistance from the federal government.

But FEMA, already strained in recent years by ever-growing and costlier disasters, is projected to face an approximately $1.6-2.3 billion deficit in its disaster relief fund (DRF) by the end of September, according to the latest projections.

White House budget director Russell Vought said there is sufficient money in the wake of the Texas disaster.

"FEMA has $13 billion in its reserves right now to continue to pay for the necessary expenses," he told reporters this month. "The president has said to Texas anything it needs, it will get."

But if the disaster fund runs too low, the government moves to the 'immediate needs' funding designation, under which non-emergency projects are put on the back burner.

"It's just adding more stress for those states and local communities that are relying on this funding to come through," Udvardy said.

FEMA did not respond to requests for comment.

States, local entities and non-profit groups had been getting a boost on projects intended to mitigate future disasters through programmes like Building Resilient Infrastructure and Communities (BRIC).

But in April FEMA ended BRIC, calling it "wasteful" and "politicized" and saying it would move unspent funds to the disaster relief fund.

Some members of Congress have called on Trump to restore those programme grants and are asking whether staff cuts at FEMA and other government agencies like the National Weather Service affected the response to the Texas floods.

The administration "cannot ignore the fact that natural disasters are becoming more severe and more frequent due to climate change," said Rep. Bennie Thompson of Mississippi, the top Democrat on the House Homeland Security Committee.

"The president threatening to eliminate FEMA, firing scientists and muzzling experts helps no one and puts us all in danger," Thompson said.

Department of Homeland Security Secretary Kristi Noem said this month that FEMA has been "disastrous" and "incompetent" at times over the years, notably after Hurricane Katrina in 2005.

"It has been slow to respond at the federal level – it's even been slower to get the resources to Americans in crisis, and that is why this entire agency needs to be eliminated as it exists today and remade into a responsive agency," Noem told the FEMA Review Council, which Trump set up in January.

Local solutions

One way the administration could keep the relief fund coffers full is simply to issue fewer major disaster declarations, although that effectively shifts clean-up costs onto states and localities.

"Certainly it appears that they are much less eager to provide disaster funding post-disaster, or at least declaring a major disaster," said Steve Ellis, president of Taxpayers for Common Sense, a watchdog group.

Nonprofit groups, states and localities have been working to come up with their own solutions in the face of more frequent and intense climate-driven storms, wildfires and hurricanes.

In Denver, Colorado, residents voted to increase a tax and establish a climate protection fund seeded with about $40 million per year, said Libby Zemaitis, senior manager for resilience programs at the Center for Climate and Energy Solutions, an environmental policy think tank.

"You're less at the mercy of the changing resources from outside," Zemaitis said of such efforts. "They know they can have the staff, have the capacity, have the long-term programs and planning needed."

(Reporting by David Sherfinski; Editing by Ellen Wulfhorst.)