Millions more in FEMA Sandy funds expected soon

Repair crews work on West Shore Road, which Repair crews work on West Shore Road, which was damaged during superstorm Sandy. (Dec. 20, 2012) Photo Credit: David Pokress

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Millions more in federal emergency funds are set to flow to help Sandy-affected municipalities in New York repair roads, bridges and other infrastructure when a key $2.5 billion threshold is crossed in coming weeks.

That figure is the critical mark at which President Barack Obama can raise to 90 percent the federal cost share for public projects approved by the Federal Emergency Management Agency, up from 75 percent. The remaining 10 percent would be met by the affected state or local municipality, or a combination of both.

Mike Byrne, FEMA's federal coordinating officer for New York, said he expects the agency's total expenditures to New York State to reach more than $2.5 billion "within the next two months."

"Once we crest past the $2.5 billion mark paid out, the state will document that and make a request to us to have the cost share adjusted from 75/25 to 90/10," Byrne said. "We will analyze it, make a recommendation to the president. The president decides. It's really pretty straightforward."

The increased cost share would bring a sigh of relief from leaders of many stretched Long Island municipalities.

Long Beach City Manager Jack Schnirman, reached as he was working on the city's budget proposal for the upcoming fiscal year, said Friday that the increase in the federal share of funding is "vital."

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"We're looking at over $200 million in total damages as a result of Sandy, as compared with $2 million for Irene," he said, referring to the August 2011 tropical storm. "An increase in the federal cost share is crucial if we are to avoid devastating the city's recovering finances."

Long Beach hopes to secure FEMA public assistance for many projects, including repairs to the beach, bay, water and sewage treatment plants, and other critical infrastructure damaged or in need of hardening after Sandy, Schnirman said.

An increase in the cost share to 90 percent would be retroactive, and eligibility requirements for public assistance grants would not be altered. For example, Long Beach learned in December that it would get $23.9 million for the federal share of a public assistance grant to reimburse a debris removal contract. The increased cost share would up that to $29 million.

FEMA aid comes in two forms. As of Friday, FEMA had obligated $1.747 billion to New York State -- $806.4 million in "public assistance" projects and $941 million in "individual assistance," mainly in the form of housing aid.

Under the Sandy federal aid package, Congress appropriated $11.48 billion for FEMA's disaster relief fund -- which also may have to cover immediate response to future disasters.

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Until now, the agency has officially advised municipalities and entities such as the Long Island Power Authority to budget conservatively, for a 75 percent cost share. But Byrne said he anticipates New York will cross the threshold easily.

"I'd be shocked if we're not over the $2.5 billion figure in the next two months at the outside. We're really processing a lot of money very quickly," he told Newsday in an interview before the five-month anniversary of the storm.

Between 1985 and 2009, a total of 222 cost-share adjustments were made for major disasters, according to a recent Congressional Research Service report.

John Cameron, chairman of the Long Island Regional Planning Council, said the increased federal cost share is sorely needed.

"It's huge," he said. "It means many impacted municipalities will be able to manage their increased costs much more effectively -- and potentially within the state-imposed tax cap, something that would not have been possible otherwise."

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Communities damaged by the Oct. 29 storm already face potential tax-assessment challenges by property owners, and that could translate into higher taxes for businesses and homes that were not affected.

"We just don't know yet how many, nor the outcome of the numerous assessment challenges that will evolve," Cameron said.

Meanwhile, FEMA and the U.S. Department of Housing and Urban Development on Friday announced a program designed to help households still displaced by Sandy. As of a week ago, 423 New York households -- including 173 in Nassau and 39 in Suffolk -- still were staying in FEMA-funded hotels or motels.

The Disaster Housing Assistance Program -- known as DHAP -- will provide temporary rental payments directly to landlords. It requires participants to sign on for case management that monitors progress on their house repairs, toward their eventual return home.

The program was created in 2007 and provided a temporary housing alternative to thousands of households displaced by Hurricane Katrina. It also was used after Hurricanes Ike and Gustav in 2008.

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"If your home, your primary residence is still uninhabitable, you don't have the resources to take care of it, you don't qualify for an SBA loan and you still need a place to stay while you're finishing repairs -- that's what this program is for," Byrne said.

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