Committee hears request to broaden use of FEMA denial reserve for disaster recovery and ARPA administration

Deputy Commissioner Artie Merrill and other administration staff told the committee that a $15 million general-fund appropriation made in fiscal 2024 to offset denied FEMA reimbursement claims still contains more than $13 million in available spending authority.

Merrill said the administration proposes amending the original fiscal‑2024 language to broaden allowable uses. Under the proposed change, remaining funds could be used not only to offset the costs of denied FEMA public-assistance claims but also to distribute to departments to cover unanticipated administrative costs related to recovery efforts from declared disasters, and to cover statewide costs associated with administering the American Rescue Plan Act (ARPA) state fiscal recovery fund programs. Eligible costs would include limited-service positions and contracted services needed to carry out recovery or ARPA-related activities.

Committee members asked whether the appropriation ever applied to individual citizens’ FEMA claims. Merrill and the administration clarified it was and remains a state-level appropriation to the Agency of Administration for state costs (for example, repairs to state-owned buildings and transportation infrastructure) and is not intended for individual-level FEMA claims.

When asked how much of the remaining balance the administration expected to use, staff deferred to the Recovery Office, which the administration said would provide a more detailed accounting. Committee members indicated they would invite the Recovery Office to testify with updated figures and spending plans.

Ending: The committee was presented with a proposed expansion in allowable uses for the FEMA-denial reserve and asked the Recovery Office to provide detailed estimates and planned distributions before the committee adopts language.