Rutherford County finance officials told the Board of Commissioners that FEMA delays in obligating disaster reimbursements have left tens of millions of dollars unpaid and are creating immediate budget strain.
Finance Director Paula Roach told commissioners the county’s largest FEMA claim—its debris removal project—totaled nearly $28 million; approximately $7.6 million was returned as expedited funding in February, and the remainder remains pending. Roach and other staff said the county has paid contractors out of its own funds while waiting for federal reimbursement, effectively creating an “IOU” that reduces local interest income and could affect the county’s credit ratings.
The discussion matters because those reimbursements fund work already completed after the storm and because the county uses its fund balance and the interest it earns to cover one‑time capital needs. Roach said the result of the reimbursement delay is lost interest earnings and reduced flexibility for projects such as vehicle purchases, courthouse work and other capital needs.
At the meeting Roach and commissioners described the scale of the county’s outstanding claims: total storm‑related costs submitted were characterized as roughly $38 million, of which about $7.6 million has been paid and roughly $31.5 million remains pending. Roach said she has met with FEMA and the Joint Field Office but that reimbursement requires additional federal steps — review by FEMA’s CRC and then congressional obligation — and that the process has been unusually slow.
Commissioners and staff also noted regional implications. Roach and county leaders cited a North Carolina Association of County Commissioners estimate that western North Carolina counties are collectively owed roughly $200 million in FEMA IOUs, and they urged federal and state legislators to press for faster federal action. County staff said S&P and Fitch are monitoring local governments’ finances and that prolonged delays could lead to credit pressure.
The board approved budget amendments at the meeting that cover several discrete items — signage, roof replacements, donated Sheriff’s programs, ARPA interest transfers and school capital grants — but commissioners asked staff to continue working with state and federal officials to get reimbursements obligated. Roach said staff are pursuing state-level pathways to convert short‑term cash flow loans into forgivable funding where possible, and county leaders said they will continue to press congressional and state offices for advocacy.
Officials emphasized the limits of local authority: payments already made to contractors cannot be retroactively made to earn interest, and there is no mechanism to collect lost interest from FEMA. Commissioners directed staff to keep pursuing reimbursements and to present options if credit or cash flow pressures intensify.