February 27, 2001: White House Proposes Drastic Cuts for Federal Disaster Mitigation Programs

The Bush administration’s proposed fiscal year 2002 budget includes a dramatic cut in federal funding for hazard mitigation grants, reducing the federal-state cost-sharing formula from 75/25 to 50/50. Mitigation grants allow localities to prepare for anticipated disasters by building levees and floodwalls, moving homes out of flood plains, and/or strengthening structures at risk from floods, earthquakes or other natural disasters. The Bush administration asserts that by making states pay more, they will spend the funds more wisely. “Shouldering a larger share of the costs will help to ensure that states select truly cost effective projects, an incentive that is missing if most of the funding is provided by FEMA,” the budget proposal reads. The proposed budget also eliminates FEMA’s Project Impact, the popular $25 million model mitigation program implemented during the Clinton administration in 1997 (see October 14, 1997-2001). Bush officials say the project, which has been launched in 250 cities and towns, “has not proven effective.” Additionally, the Bush administration proposes to eliminate $12 million from the National Flood Insurance Program budget by $12 million by denying coverage for thousands of “repetitive loss” properties in flood plains. [Office of Management and Budget, 2/27/2001, pp. 81 ; Washington Post, 5/8/2001] A repetitive loss property is one that has suffered flood damage two or more times over a 10-year period and for which repair costs exceed more than 25 percent of its market value. [FEMA, 10/22/2004] White House spokesman Scott Stanzel explains that proposed cuts to these and other federal emergency management programs are part of “an ongoing effort to shift control and responsibility to the states and give them more flexibility.” [Washington Post, 5/8/2001] Jack Harrald, director of the Institute for Crisis, Disaster and Risk Management at George Washington University, says in an interview with the Washington Post that Bush administration officials “clearly are disassociating themselves from programs closely identified with the previous administration. Whether a broader philosophical process is going on is not entirely clear yet, but I suspect it is.” [Washington Post, 5/8/2001] Congress will reject the administration’s proposal to reduce the 75/50 cost-sharing formula, but agree to end Project Impact. [Independent Weekly, 9/22/2004]