[Federal Register Volume 74, Number 153 (Tuesday, August 11, 2009)]
[Proposed Rules]
[Pages 40124-40131]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E9-19156]
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DEPARTMENT OF HOMELAND SECURITY
Federal Emergency Management Agency
44 CFR Part 206
[Docket ID FEMA-2008-0006]
RIN 1660-AA47
Disaster Assistance; Public Assistance Repetitive Damage
AGENCY: Federal Emergency Management Agency, DHS.
ACTION: Notice of proposed rulemaking.
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SUMMARY: This proposed rule implements aspects of the Disaster
Mitigation Act of 2000 by reducing the Federal cost share of FEMA
Public Assistance to public and certain private nonprofit facilities
repetitively damaged in the preceding 10 years by the same type of
event and for which required hazard mitigation has not been
[[Page 40125]]
implemented. The Federal government should not repetitively reimburse
eligible applicants for damage that could be prevented through
mitigation efforts. The reduced Federal cost share of the proposed rule
is intended to provide an incentive to mitigate repetitive damage,
promote measures that reduce future loss to life and property, protect
Federal investment in public infrastructure, and help build disaster-
resistant communities.
DATES: Submit comments on or before October 13, 2009.
ADDRESSES: You may submit comments, identified by Docket ID FEMA-2008-
0006, by one of the following methods:
Federal eRulemaking Portal: http://www.regulations.gov. Follow the
instructions for submitting comments.
E-mail: [email protected]. Include Docket ID FEMA-2008-0006 in the
subject line of the message.
Fax: 703-483-2999.
Mail/Hand Delivery/Courier: Rules Docket Clerk, Office of Chief
Counsel, Federal Emergency Management Agency, Room 835, 500 C Street,
SW., Washington, DC 20472-3100.
Instructions: All Submissions received must include the agency name
and docket ID. Regardless of the method used for submitting comments or
material, all submissions will be posted, without change, to the
Federal eRulemaking Portal at http://www.regulations.gov, and will
include any personal information you provide. Therefore, submitting
this information makes it public. You may wish to read the Privacy Act
notice that is available on the Privacy and Use Notice link on the
Administration Navigation Bar of http://www.regulations.gov.
Docket: For access to the docket to read background documents or
comments received, go to the Federal eRulemaking Portal at http://www.regulations.gov and search for Federal Emergency Management Agency
docket ID ``FEMA-2008-0006.'' Submitted comments may also be inspected
at FEMA, Office of Chief Counsel, Room 835, 500 C Street, SW.,
Washington, DC 20472-3100.
FOR FURTHER INFORMATION CONTACT: Tod Wells, Acting Director, Public
Assistance Division, Federal Emergency Management Agency, 500 C Street,
SW., Room 414, Washington, DC 20472-3100, (phone) 202-646-3936;
(facsimile) 202-646-3304; or (e-mail) [email protected].
SUPPLEMENTARY INFORMATION:
I. Background
Each year, disasters strike the United States, including natural
events such as hurricanes, tornadoes, storms, earthquakes, volcanic
eruptions, landslides, snowstorms, and droughts and events that occur
from various other causes such as fires, floods, and explosions. When a
disaster occurs and a locality has responded to the best of its ability
and is, or will be, overwhelmed by the magnitude of the damage, the
community turns to the State for help. If it is evident that the
situation is or will be beyond the combined capabilities of the local
and State resources, the Governor may request that the President
declare that an emergency or major disaster exists in the State, under
the authority of the Robert T. Stafford Disaster Relief and Emergency
Assistance Act \1\ (Stafford Act).
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\1\ Disaster Relief Act of 1974, Public Law 93-288, 88 Stat. 143
(May 22, 1974), as amended 42 U.S.C. 5121 et seq.
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If an emergency or major disaster is declared, the Federal
Emergency Management Agency (FEMA) may award Public Assistance grants
to assist State, Tribal, and local governments and certain private
nonprofit entities (applicants), as defined in subpart H of 44 CFR part
206, with the response to and recovery from disasters. Specifically,
the Public Assistance Program provides assistance for debris removal,
emergency protective measures and permanent restoration of
infrastructure. To obtain these Public Assistance grants for damaged
facilities, the applicants must identify disaster-related damage which
is documented on a Project Worksheet (PW), referenced at 44 CFR
206.201(i).
The PW is the basis for Public Assistance grants and FEMA uses the
PW to document eligible costs. Federal funding is subject to the cost
share provisions established in the Stafford Act (42 U.S.C. 5172(b)),
and FEMA-State Agreement (44 CFR 206.47(a)). Typically, the Federal
cost share is 75 percent of the eligible costs identified on the PW.
In 2000, the President signed into law the Disaster Mitigation Act
of 2000 (DMA 2000), Public Law 106-390, 42 U.S.C. 5121 note. Subsection
205(b) of DMA 2000 amended section 406 of the Stafford Act by adding a
new paragraph (b)(2) (42 U.S.C. 5172(b)(2)) which states:
The President shall promulgate regulations to reduce the Federal
share of assistance under this section to not less than 25 percent
in the case of the repair, restoration, reconstruction, or
replacement of any eligible public facility or private nonprofit
facility following an event associated with a major disaster--(A)
that has been damaged, on more than one occasion within the
preceding10-year period, by the same type of event; and (B) the
owner of which has failed to implement appropriate mitigation
measures to address the hazard that caused the damage to the
facility.
This cost share reduction adds to existing hazard mitigation
authorities under sections 203, 404, and 406 of the Stafford Act.
II. Discussion of the Proposed Rule
In accordance with the amendment to section 406 of the Stafford
Act, this proposed rule would reduce the Federal cost share to 25
percent of eligible costs if the applicant has not taken appropriate
mitigation measures on a repetitively damaged facility. FEMA identified
a number of key issues in drafting this proposed rule. These include:
(A) Defining a ``facility'' as it relates to the new statutory
provision; (B) determining when the requirements of the new provision
will become effective; (C) determining what qualifies as ``more than
one occasion;'' (D) defining the ``same type of event;'' (E)
determining the amount of the cost share reduction; (F) defining an
``appropriate mitigation measure;'' and the process for identifying
such mitigation measures; and (G) establishing a system to identify
repetitively damaged facilities. FEMA discusses each of these issues
individually below. FEMA invites comment on each of these issues as
well as any other issues the public may find relevant.
A. Definition of ``Facility''
FEMA proposes to use the existing definition of a ``facility'' in
44 CFR 206.201(c). The existing definition states: ``Facility means any
publicly or privately owned building, works, system, or equipment,
built or manufactured, or an improved and maintained natural feature.
Land used for agricultural purposes is not a facility.'' Using the
existing definition of ``facility'' in 44 CFR 206.201(c) will eliminate
any potential confusion caused by a separate definition for the
application of this rule and ensure programmatic consistency.
B. When Will the Requirements Become Effective?
FEMA would begin the process of counting events for eligible
damaged facilities only after it issues an effective rule. While one
might argue that FEMA should have begun tracking such events upon the
enactment of the DMA 2000, FEMA proposes not to begin that process
until it issues an effective rule, in order to give applicants ample
time to implement appropriate mitigation
[[Page 40126]]
measures. FEMA believes this process is further justified because this
proposed rule is still subject to change based upon public comments
received.
C. Definition of ``More Than One Occasion''
FEMA would reduce the Federal cost share upon the third occurrence
of damage to an eligible facility. In drafting the proposed rule, FEMA
contemplated reducing the Federal cost share upon the second damaging
event. However, the Stafford Act states that the reduction in benefits
can only occur to a facility ``that has been damaged, on more than one
occasion.'' A facility that is damaged on ``more than one occasion''
has suffered damage at least twice. Therefore, the benefit reduction
would have to occur on or after the third occasion. Consistent with the
statutory language, FEMA would reduce Federal assistance upon the third
occurrence of the ``same type of event.''
D. Definition of ``Same Type of Event''
Another issue that FEMA addressed is the definition of the ``same
type of event'' that will trigger the cost share reduction mandates.
FEMA considered how precisely the term ``event'' should be defined. The
proposed rule defines ``same type of event'' as one that is the same
major disaster type (e.g., hurricane, tornado, flood, or earthquake).
FEMA documents the major disaster type on every PW. By defining ``same
type of event'' by major disaster type, FEMA can easily track and
ensure consistent application of the proposed rule. For example, if a
facility was damaged by a hurricane three times in a 10-year period,
the facility would be considered a repetitively damaged facility.
However, to trigger the cost share reduction under this rule, the
applicant must have been required, and failed to take, ``appropriate
mitigation measures,'' which are discussed below. ``Appropriate
mitigation measures'' would address the type of damage that the
facility sustained.
The new cost share reduction provision of the Stafford Act does not
contain a damage threshold amount below which this provision does not
apply. However, in situations where eligible facilities sustain less
than $1,000 in damages during a major disaster, the damage is not
eligible for FEMA assistance. See 44 CFR 206.202(d)(2). Therefore, FEMA
would not consider the event that resulted in damage in an amount less
than $1,000 as an ``event'' for the purposes of implementation of the
new statutory provision. Similarly, under the proposed rule if an
eligible applicant elects to pay 100 percent of the costs to repair a
particular facility and those costs would otherwise have been eligible
for FEMA assistance, FEMA would not count the disaster as an ``event''
with regard to that particular facility.
E. Determining Amount of Cost Share Reduction
This proposed rule also describes how FEMA proposes to calculate
the cost share reduction. FEMA must define how it will ``reduce the
Federal share of assistance under this section to not less than 25
percent'' of eligible costs for facilities that have been damaged
repetitively and whose owners have not implemented appropriate hazard
mitigation measures. Rather than imposing a cost share reduction on a
gradual basis, the proposed rule imposes a cost share reduction to 25
percent of eligible costs immediately upon the occurrence of the third
event.
FEMA drafted the proposed rule to effect a direct reduction in cost
share from no less than 75 percent to 25 percent; i.e., FEMA would not
make any variable cost share between 75 and 25 percent. FEMA reasoned
that this is consistent with the Congressional desire that this type of
concern be addressed aggressively and independent of FEMA's other
hazard mitigation authorities. FEMA concluded that a ``sliding'' scale
would subject FEMA to routine cost share negotiations and appeals
whenever a facility met the repetitive loss criteria, and that the
development of lengthy criteria to detail exactly how and when the
sliding reduction would occur, as well as a resulting complex rule that
would be difficult to implement consistently, would place undue
administrative burdens on disaster assistance applicants and on FEMA.
FEMA also considered a stepped cost share reduction, e.g., 75 percent
[rtarr13]50 percent [rtarr13]25 percent, but concluded that this option
would not result in mitigation against future losses as quickly as
going directly to a 25 percent reduction immediately upon the third
event. FEMA notes that Congress set 25 percent as the most stringent
reduction and thus FEMA concludes that going directly to that
percentage reduction is the most effective means to meet the objective
of the statute, absent use of a sliding scale or stepped cost share
reduction. Therefore, this proposed rule implements the 25 percent
reduction immediately upon the third event.
F. Definition of Appropriate Mitigation Measures
In drafting this proposed rule, FEMA also considered the definition
of the statutory language ``appropriate mitigation measures'' for the
purpose of implementing the amendment to section 406 of the Stafford
Act, (42 U.S.C. 5172(b)(2)). Sections 203, 322, 404, and 406 of the
Stafford Act and their implementing regulations such as 44 CFR 201.2,
206.2, 206.111, 206.117, and 206.431 currently reference ``hazard
mitigation measures,'' ``eligible hazard mitigation measures,''
``hazard mitigation measures that are cost effective,'' and ``hazard
mitigation criteria required by the President.'' However, the new
provision of the Stafford Act, 42 U.S.C. 5172(b)(2), contains the first
reference within the Stafford Act to ``appropriate mitigation
measures'' and there is no legislative history that clarifies the
meaning of this new statutory language.
In the proposed rule FEMA has defined ``appropriate mitigation
measures'' using the same definition as ``hazard mitigation'' which is
defined in 44 CFR 206.2(a)(14). Section 206.2(a)(14) defines ``hazard
mitigation'' as: ``Any cost effective measure which will reduce the
potential for damage to a facility from a disaster event.'' FEMA's
policy to determine cost-effectiveness under the Public Assistance
program includes mitigation measures that amount up to 15 percent of
the total eligible cost of the eligible repair work on a particular
project, certain mitigation measures that FEMA has pre-determined cost-
effective, and an acceptable benefit/cost analysis methodology. See
FEMA Public Assistance Guide FEMA 322 (June 2007), Disaster Assistance
Policy 9526.1, ``Hazard Mitigation Funding Under Section 406 (Stafford
Act)'' (available at: http://www.fema.gov/government/grant/pa/9526_1.shtm). The eligibility of hazard mitigation for Public Assistance
applicants is further addressed in 44 CFR 206.226. In approving grant
assistance for restoration of facilities, FEMA may require cost
effective hazard mitigation measures not required by applicable
standards pursuant to 44 CFR 206.226(e). Defining ``appropriate
mitigation measures'' with the same criteria as ``hazard mitigation''
ensures a more consistent evaluation for determining required
mitigation.
The applicant would have to perform the appropriate mitigation
measure on the damaged component of the facility. The appropriate
mitigation should be for the type of damage sustained (wind,
[[Page 40127]]
water, etc.). For example, if a roof was damaged by wind, FEMA may
require mitigation against wind damage to the roof rather than
requiring mitigation against fire or water damage to the roof.
FEMA examined several options for determining appropriate
mitigation measures for a facility. FEMA considered linking an
``appropriate mitigation measure'' to compliance with current, local
building codes applicable to certain hazards, such as earthquakes.
However, such a definition would not be adequate for all hazards, such
as floods, affecting all disaster-prone communities in the United
States.
FEMA also considered defining ``appropriate mitigation measures''
in terms of probabilities, e.g., measures designed to reduce the
likelihood of damage from the flood event with a 1-percent annual
chance of occurrence. However, one general probabilistic-based design
may not work for all hazard scenarios. FEMA deemed this approach
problematic for a number of reasons. First, these probabilistic design
standards may have conflicted with local codes and design standards.
Second, in some cases these probabilistic-based designs may have
exacerbated the hazard that they were intended to mitigate. For
example, culverts for storm drainage which handle intermittent flows
are, in most cases, designed to handle significantly less than the 1-
percent annual chance of a storm event; sizing them to handle the 1-
percent flood flow would tend to increase downstream flood flows and
increase costs and environmental impacts. Third, a probabilistic-based
design standard for ``appropriate mitigation measures'' could result in
inconsistencies with the State, Local and Indian Tribal Mitigation
Plans required by section 322 of the Stafford Act, as well as
inconsistencies in application because such a probabilistic design
would require FEMA to approve the mitigation measures on a case-by-case
basis.
Under section 322 of the Stafford Act and 44 CFR 201.4 and 201.7, a
State or Indian Tribal government acting as a Grantee must have, at a
minimum, a FEMA approved Standard State or Tribal Mitigation Plan in
effect to receive certain types of non-emergency assistance under the
Stafford Act. Under section 322 of the Stafford Act and 44 CFR 201.4, a
local or Indian Tribal government must have an approved local or Indian
Tribal plan in effect to receive assistance under the Hazard Mitigation
Grant Program (HMGP). Since FEMA believes that it is important for its
hazard mitigation programs to complement one another, FEMA proposes to
require that any appropriate mitigation measure for an eligible
facility be consistent with the State Mitigation Plan or Tribal
Mitigation Plan, if the Indian Tribal government is the Grantee, as
described at 44 CFR 201.4 through 44 CFR 201.6.
State Mitigation Plans provide general mitigation planning
guidelines for mitigation measures throughout the State, while Local
and/or Indian Tribal Mitigation Plans provide more specific criterion
for appropriate mitigation measures for a facility. FEMA was concerned
that, in the absence of a Local and/or Indian Tribal Mitigation Plan
for a designated area, the State Mitigation Plan would not provide
sufficient guidance regarding appropriate mitigation measures for a
facility. FEMA considered requiring revision to, or creation of, a
Local and/or Indian Tribal Mitigation Plan should a specific
appropriate mitigation measure not be specified for a facility;
however, the time required to do so could cause unacceptable delays in
providing appropriate mitigation to the facility. Further, State
Mitigation Plans as described under 44 CFR 201.4 already require the
State to coordinate mitigation measures with Local or Tribal Mitigation
Plans, where they exist.
G. Identifying Repetitively Damaged Facilities
To implement the proposed requirements in this rulemaking, FEMA
needs to collect repetitive loss information. FEMA would track the
history of the provision of disaster assistance following
Presidentially-declared major disasters by applicant and facility
through the use of its National Emergency Management Information System
(NEMIS)/Emergency Management Mission Integrated Environment (EMMIE)
computer program and database in which all PW's are stored. FEMA would
use the latitude and longitude documented on the PW and entered into
NEMIS/EMMIE for the damaged facility to track repetitively damaged
facilities. Tracking and recording this information in NEMIS/EMMIE
would assist FEMA in correctly and consistently interpreting the
requirements in this proposed rule, and if the Federal cost share is
reduced it would serve as essential documentation for resolving appeals
that may follow.
III. Regulatory Analysis
A. National Environmental Policy Act (NEPA)
The National Environmental Policy Act of 1969 (NEPA), Public Law
91-190, 83 Stat. 852 (Jan. 1, 1970) (42 U.S.C. 4321 et seq.), as
amended, requires that agencies consider environmental impacts in their
decision-making. Specifically, NEPA requires agencies to prepare an
Environmental Impact Statement (EIS) for ``major federal actions
significantly affecting the quality of the human environment.'' If an
action may or may not have a significant impact, the agency must
prepare an Environmental Assessment (EA). If, as a result of this
study, the agency makes a Finding of No Significant Impact (FONSI), no
further action is necessary. If the action will have a significant
effect, the agency uses the EA to develop an EIS.
Pursuant to 44 CFR 10.8(c)(2), action taken or assistance provided
under sections 402, 403, 407, or 502 of the Stafford Act and action
taken or assistance provided under section 406 of the Stafford Act that
has the effect of restoring facilities substantially as they existed
before a major disaster or emergency are statutorily excluded from NEPA
and the preparation of environmental impact statements and
environmental assessments by section 316 of the Robert T. Stafford
Disaster Relief and Emergency Assistance Act (Stafford Act), as
amended, 42 U.S.C. 5159. Also, 44 CFR 10.8(d)(2)(xix) excludes hazard
mitigation activities under the Stafford Act, and 44 CFR 10.8(d)(2)(ii)
excludes the preparation, revision and adoption of regulations from the
preparation of an EA or EIS where the rule relates to actions that
qualify for categorical exclusions, FEMA has determined that this
proposed rule is categorically excluded from the preparation of an EA
or an EIS. Further, the changes proposed by this rule are
administrative changes to the Public Assistance program that would have
no effect on the environment. See 44 CFR 10.8(d)(1).
B. Paperwork Reduction Act of 1995
As required by the Paperwork Reduction Act of 1995 (PRA) Public Law
104-33 (44 U.S.C. 3501 et seq.), as amended, an agency may not conduct
or sponsor, and a person is not required to respond to, a collection of
information unless the collection of information displays a valid
control number. This rulemaking involves the reduction in Federal
assistance for public or private nonprofit facilities repetitively
damaged by the same type of disaster when the
[[Page 40128]]
owner has failed to take appropriate mitigation measures. To identify
repetitively damaged facilities, FEMA must be able to track damaged
facilities.
In order to accurately record damaged facilities and, therefore,
track repetitively damaged facilities, FEMA would use the latitude and
longitude for the damaged facility. FEMA already collects the latitude
and longitude of facilities on the PW and enters the latitude and
longitude into NEMIS/EMMIE. The PW instructions currently require the
latitude and longitude for all damaged facilities. The PW instructions
fall under OMB Collection No. 1660-0017 ``Project Worksheets and
Continuation Forms'' which expires December 31, 2011. There would be no
additional burden to the approved collection as a result of the changes
proposed in this rule.
C. Executive Order 12866, Regulatory Planning and Review
FEMA has prepared and reviewed this rule under the provisions of
Executive Order 12866, Regulatory Planning and Review. Under Executive
Order 12866, a significant regulatory action is subject to Office of
Management and Budget (OMB) review and the requirements of the
Executive Order. The Executive Order defines ``significant regulatory
action'' as one that is likely to result in a rule that may:
(1) Have an annual effect on the economy of $100 million or more or
adversely affect in a material way the economy, a sector of the
economy, productivity, competition, jobs, the environment, public
health or safety, or State, local, or Tribal governments or
communities;
(2) Create a serious inconsistency or otherwise interfere with an
action taken or planned by another agency;
(3) Materially alter the budgetary impact of entitlements, grants,
user fees, or loan programs or the rights and obligations of recipients
thereof; or
(4) Raise novel legal or policy issues arising out of legal
mandates, the President's priorities, or the principles set forth in
the Executive Order.
This proposed rule does not meet the criteria under paragraph 2, 3,
or 4 of the provision of the Executive Order. In addition, FEMA
determined that it is not likely to have a significant economic impact
of $100 million or more per year (under paragraph 1 of this provision).
This proposed rule has not been reviewed by OMB.
As authorized by DMA 2000, this proposed rule would reduce the
Federal cost share to 25 percent for eligible Public Assistance cost to
repair, restore, reconstruct or replace an eligible public facility or
private nonprofit facility that has been damaged twice within the
preceding 10 years by the same type of event and the owner of the
facility has not implemented appropriate mitigation measures before the
third event of the same type. The proposed rule would not affect the
Public Assistance eligibility requirements. Further, the proposed rule
would only affect public facilities and eligible private nonprofit
facilities. It would not affect grants made under the Individual
Assistance program.
The statutory mandate imposed upon FEMA required the agency to
reduce the Federal share to ``not less than 25 percent'' of eligible
costs, and did not specifically mandate that FEMA establish the 25
percent rate chosen in this rule. Rather than imposing a cost share
reduction on a gradual basis, the proposed rule imposes a cost share
reduction to 25 percent of eligible costs immediately upon the
occurrence of the third event. Developing objective criteria for an
incremental cost share reduction from 75 percent to 25 percent (perhaps
with a median reduction at 50 percent) would likely result in a complex
rule that FEMA could not implement consistently without placing
additional administrative burdens on disaster assistance applicants, as
well as an undue burden on FEMA to develop and administer such a rule.
Therefore, this proposed rule would implement the full 25 percent
reduction immediately upon the third event.
FEMA cannot predict with certainty the future number of major
disasters that will affect the nation in a given year or the number of
facilities that will be repetitively damaged from those disasters.
However, between January 1, 1998, and January 1, 2008, there was an
average of 54 major disaster declarations made per year. Out of the
approximately 88,060 Public Assistance applicants in the past 10 years,
FEMA identified 1,756 of those applicants that suffered similar damage
within the same damage category at least twice in that time period.
These applicants would have, if this proposed rule had been in effect,
undertaken mitigation efforts or risk a reduced cost share percentage
should a disaster of the same type damage their facility a third time
within 10 years of the first of those two disasters. This figure only
amounts to 2 percent of all Public Assistance applicants. The total
eligible cost for these 1,756 Public Assistance applicants was $1.32
billion (in 2008 dollars) \2\ over the past 10 years, which amounts to
approximately $132 million per year.
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\2\ Data were adjusted for inflation based on Consumer Price
Index (CPI) published by the Bureau of Labor Statistics (BLS).
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Under section 406 of the Stafford Act, 42 U.S.C. 5172(b)(1), the
Federal share could not be less than 75 percent of eligible costs.
Under the terms of this proposed rule which would implement the new
paragraph 42 U.S.C. 5172(b)(2), if applicants failed to implement
appropriate mitigation measures for these repetitively damaged
facilities, the percentage of the Federal share would be reduced to 25
percent. Taking a conservative estimate and assuming that all 1,756
applicants failed to implement appropriate mitigation measures, the
cost implication would be as follows: 75 percent of the eligible costs
of $132 million is $99 million and 25 percent of $132 million is $33
million, so the potential reduction in Federal assistance would be
approximately $66 million annually based on an analysis of the period
January 1, 1998 through January 1, 2008.
Under the proposed rule, to be eligible for the full Federal cost
share an applicant must implement required hazard mitigation measures
prior to the third event of the same type. The required hazard
mitigation will vary from facility to facility. However, typical
mitigation measures include, but are not limited to, the relocation out
of hazardous locations, slope stabilization, protection from high winds
(shutters, hurricane clips, anchors), flood proofing of buildings
(elevation, use of flood-resistant materials), flood protection of
bridges and culverts (use clear spans instead of multiple spans,
riprap), protecting against seismic changes (bracing, anchoring), and
the protection of utilities (anchoring, use of disaster-resistant
materials, elevation). In general, appropriate mitigation measures
should be cost-effective.
The cost to mitigate these facilities may be eligible for the HMGP,
so States, local and/or Tribal governments and some private nonprofit
entities may be able to seek Federal funds to offset the cost of
mitigation efforts. Although this proposed regulation would not affect
the HMGP, additional information regarding the program may be found in
FEMA's regulations in 44 CFR parts 78, 201, and 206 and at http://www.fema.gov/government/grant/hmgp/index.shtm.
This proposed rule could potentially have an impact of
approximately $66 million per year. As a benefit, this reduced Federal
cost share would provide an incentive to mitigate repetitive damage.
Mitigation focuses on breaking the cycle of disaster damage,
reconstruction, and repeated damage. Mitigation efforts provide value
to the
[[Page 40129]]
American people by creating safer communities and reducing loss of life
and property, enabling communities to recover more rapidly from
disasters, and lessening the financial impact of disasters on
individuals, the Treasury, State, local and Tribal communities.
D. Executive Order 13132, Federalism
Executive Order 13132, ``Federalism'' (64 FR 43255, Aug. 10, 1999),
sets forth principles and criteria that agencies must adhere to in
formulating and implementing policies that have federalism
implications, that is, regulations that have ``substantial direct
effects 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.'' Federal
agencies must closely examine the statutory authority supporting any
action that would limit the policymaking discretion of the States and,
to the extent practicable, must consult with State and local officials
before implementing any such action.
FEMA has reviewed the proposed rule under Executive Order 13132 and
has concluded that the proposed rule, which implements statutory
requirements, does not have federalism implications as defined by
Executive Order 13132. FEMA has determined that the rule does not
significantly affect the rights, roles, and responsibilities of States,
and involves no preemption of State law nor does it limit State
policymaking discretion. This rulemaking amends a voluntary grant
program that may be used by State, local and Tribal governments and
eligible private nonprofit organizations to receive Federal grants to
assist in the recovery from disasters. States are not required to seek
grant funding, and this rulemaking does not limit their policymaking
discretion. In addition, FEMA actively encourages and solicits comments
on this proposed rule from interested parties.
E. Executive Order 12898, Environmental Justice
Under Executive Order 12898, as amended ``Federal Actions to
Address Environmental Justice in Minority Populations and Low-Income
Populations'' (59 FR 7629, Feb. 16, 1994), FEMA has undertaken to
incorporate environmental justice into its policies and programs.
Executive Order 12898 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 because of their race, color, or
national origin or income level.
The purpose of this rule is to reduce the Federal cost share for
repetitively damaged facilities where the owner of the facility has not
implemented appropriate mitigation measures. This reduced Federal cost
share would provide an incentive to mitigate future damage. Mitigation
focuses on breaking the cycle of repeated disaster damage. Mitigation
efforts provide value to the American people by creating safer
communities and reducing loss of life and property, enables communities
to recover more rapidly from disasters, and lessens the financial
impact of disasters on individuals, the United States Department of the
Treasury, State, local and Tribal communities.
No action that FEMA can anticipate under the proposed rule will
have a disproportionately high and adverse human health or
environmental effect on any segment of the population. In accordance
with Congressional mandates, the proposed rule implements the Federal
cost share reduction for repetitively damaged facilities. Accordingly,
the requirements of Executive Order 12898 do not apply to this proposed
rule.
F. Executive Order 13175, Consultation and Coordination With Indian
Tribal Governments
FEMA has reviewed this proposed rule under Executive Order 13175
``Consultation and Coordination with Indian Tribal Governments'' (65 FR
67249, Nov. 9, 2000). Under Executive Order 13175, FEMA may not issue a
regulation that has tribal implications, that imposes substantial
direct compliance costs on Indian Tribal governments, and that is not
required by statute. In reviewing the proposed rule, FEMA finds that
because Indian Tribal governments are potentially eligible applicants
under the Public Assistance program, the proposed rule does have
``tribal implications'' as defined in the Executive Order. The
implications of the proposed rule, however, will not have a substantial
direct effect 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. The proposed rule does not impose substantial direct compliance
costs on Indian Tribal governments nor does it preempt tribal law,
impair treaty rights nor limit the self-governing powers of Indian
Tribal governments.
Furthermore, this regulatory change is required by statute. This
proposed regulation would implement an amendment to 42 U.S.C. 5172(b),
which mandates a reduction in the percentage of Federal funding
provided after a public or private nonprofit facility has been damaged
more than once within the preceding 10 years by the same type of event
and the owner of the facility has not implemented appropriate
mitigation measures before the third event of the same type.
G. Regulatory Flexibility Act Statement
Under 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 (Pub. L. 104-121, 110 Stat. 847, 858-9 (March 29, 1996) (5
U.S.C. 601 note)), agencies must consider the impact of their
rulemakings on ``small entities'' (small businesses, small
organizations and local governments). The RFA applies to any proposed
rulemaking subject to notice and comment under section 553 of the
Administrative Procedure Act (APA) (5 U.S.C. 553). The RFA requires
Federal agencies to consider the potential impact of regulations on
small businesses, small governmental jurisdictions, and small
organizations during the development of their rules.
FEMA used 2000 U.S. Census Bureau data to identify actual Public
Assistance applicants that under the RFA could be considered small
entities. FEMA identified 920 Public Assistance applicants with
populations of 50,000 or less that suffered similar damage within the
same damage category twice over the past 10 years. Therefore, these 920
Public Assistance applicants could be considered small entities under
the RFA and could potentially meet the definition of repetitively
damaged facilities if their facility is damaged a third time within
that 10-year period. Out of the 920 Public Assistance applicants that
are considered small entities, 914 are small governmental jurisdictions
and 6 are private nonprofit (PNP) organizations. These 920 small
entities amount to approximately 52 percent of the total 1,756
applicants that suffered similar damage at least twice over the past 10
years.
Assuming that all 920 Public Assistance applicants failed to
implement required hazard mitigation and suffered damage a third time,
so that they meet the definition of a repetitively damaged facility,
this would only amount to one percent of all Public Assistance
applicants. The total eligible cost was $429.32 million (in 2008
[[Page 40130]]
dollars) \3\ for these 920 applicants over the past 10 years. This
equals an annual average of approximately $42.93 million.
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\3\ Data were adjusted for inflation based on the Consumer Price
Index (CPI) published by the Bureau of Labor Statistics (BLS).
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Under the terms of this proposed rule, if applicants failed to
implement required hazard mitigation for these repetitively damaged
facilities, FEMA would reduce the percentage of the Federal cost share
to 25 percent. Under section 406 of the Stafford Act, 42 U.S.C.
5172(b)(1), the Federal share could not be less than 75 percent of
eligible costs. Since 75 percent of $42.93 million is $32.20 million
and 25 percent of $42.93 million is $10.73 million, the potential
reduction would be $21.47 million in Federal assistance each year. As a
result, the average impact to these 920 applicants is $23,337 per year
(= 21,470,000/920).
FEMA measured the annual impact of this rule on each of these 914
small governmental jurisdictions \4\ based on the estimated reduction
in Federal assistance and annual revenues. Annual revenues for these
914 small governmental jurisdictions were estimated from the per capita
revenue for local governments by State.\5\ For example, the total
revenue for all local governments in Alabama in 2005-06 was $18.41
billion (in 2008 dollars) and the population is 4.66 million, resulting
in the per capita revenue of $3,951. Therefore, annual revenue for a
small governmental jurisdiction in Alabama with a population size of
500 is estimated approximately at $1.98 million (= $3,951 x 500). FEMA
compared the estimated reduction in Federal assistance with the
estimated annual revenue for each of these 914 small governmental
jurisdictions. Out of these 914 small governmental jurisdictions, only
19 (or 2 percent) are expected to have an impact higher than 1 percent
of their annual revenues. Consequently, FEMA certifies that there is no
significant economic impact on a substantial number of small entities.
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\4\ The 6 PNP organizations were not included as their annual
revenues cannot be estimated.
\5\ U.S. Census Bureau (2009), State and Local Government
Finance, http://ftp2.census.gov/govs/estimate/06slsstab1a.xls.
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H. Unfunded Mandates Reform Act
The Unfunded Mandates Reform Act of 1995 (UMRA), Public Law 104-4,
109 Stat. 48 (March 22, 1995) (2 U.S.C. 1501 et seq.), requires each
Federal agency, to the extent permitted by law, to prepare a written
assessment of the effects of any Federal mandate in a proposed or final
agency rule that may result in the 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. UMRA
exempts from its definition of ``Federal intergovernmental mandate''
regulations that establish conditions of Federal assistance or provide
for emergency assistance or relief at the request of any State, local,
or Tribal government. Therefore, this proposed rule is not an unfunded
Federal mandate under that Act.
I. 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.
J. Executive Order 12630, Governmental Actions and Interference With
Constitutionally Protected Property Rights
FEMA has reviewed this rule under Executive Order 12630,
``Governmental Actions and Interference with Constitutionally Protected
Property Rights'' (53 FR 8859, Mar. 18, 1988) as supplemented by
Executive Order 13406, ``Protecting the Property Rights of the American
People'' (71 FR 36973, June 28, 2006). This rule will not affect a
taking of private property or otherwise have taking implications under
Executive Order 12630.
K. Congressional Review of Agency Rulemaking
FEMA will send this rule to Congress and to the Government
Accountability Office under the Congressional Review of Agency
Rulemaking Act (Congressional Review Act), Public Law 104-121, 110
Stat. 873 (March 29, 1996) (5 U.S.C. 804) before it is effective. This
proposed rule is not a ``major rule'' within the meaning of the
Congressional Review Act. This rulemaking would not result in a major
increase in costs or prices for consumers, individual industries,
Federal, State, or local government agencies, or geographic regions,
nor would it have ``significant adverse effects'' on competition,
employment, investment, productivity, innovation, or on the ability of
United States-based enterprises to compete with foreign-based
enterprises.
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 proposes to amend 44 CFR part 206 as follows:
1. The authority citation of Part 206 is revised to read as
follows:
Authority: 42 U.S.C. 5121 through 5207; Reorganization Plan No.
3 of 1978, 43 FR 41943, 3 CFR, 1978 Comp., p. 329; 6 U.S.C. 101; EO
12127, 44 FR 19367, 3 CFR, 1979 Comp., p. 376; E.O. 12148, 44 FR
43239, 3 CFR, 1979 Comp., p. 412; E.O. 13286, 68 FR 10619, 3 CFR,
2003 Comp., p. 166.
In Sec. 206.226, add a new paragraph (l) to read as follows:
Sec. 206.226 Restoration of damaged facilities.
* * * * *
(l) Repetitively damaged facilities. A repetitively damaged
facility is an eligible facility that has suffered damage from the same
type of event for which Public Assistance has been approved twice
within the past 10 years. If appropriate mitigation measures, required
pursuant to paragraph (e) of this section, have not been made to the
facility before a third event of the same type, the Federal share of
eligible repair costs is 25 percent.
(1) ``Appropriate mitigation measures'' has the same meaning as
``hazard mitigation'' which is defined in Sec. 206.2(a)(14). The
appropriate mitigation measures for the facility must be consistent
with the mitigation strategy identified in the State Mitigation Plan
described in Sec. 201.4 of this chapter, or the Tribal Mitigation
Plan, if the Indian Tribal government is the Grantee as described in
Sec. 201.7 of this chapter.
(2) The 25 percent Federal cost share will not be applied to a
facility that is damaged before the deadline to complete approved
mitigation work in accordance with Sec. 206.204(c) and (d).
(3) ``Same type of event'' means the same major disaster type,
including but not limited to hurricane, tornado, flood, or earthquake.
(4) Damage to an eligible facility will not be counted as a
repetitive damage ``event'' for that particular facility if the
eligible applicant elects to pay 100 percent of the costs to repair the
facility, or the facility sustains less than $1,000 in damage from the
disaster event.
(5) Events will be counted toward repetitive status after [DATE 30
DAYS AFTER DATE OF PUBLICATION OF
[[Page 40131]]
THE FINAL RULE IN THE FEDERAL REGISTER].
Dated: August 4, 2009.
W. Craig Fugate,
Administrator, Federal Emergency Management Agency.
[FR Doc. E9-19156 Filed 8-10-09; 8:45 am]
BILLING CODE 9111-23-P