Board approves $4.3 million release from disaster reserves, aims to return funds to original subdivisions

The Napa County Board of Supervisors voted unanimously June 17 to release $4,300,000 in restricted fund balance tied to federally assisted disaster projects and to approve related budget transfers and amendments.

Audit Controller Tracy Schulze told the board the action responds to the status of multiple Federal Emergency Management Agency and California Governor’s Office of Emergency Services (Cal OES) disaster projects and the timing of audit waivers. "We restrict funds received until the closeout process is complete and risk of audit and clawback has passed," Schulze said during the presentation.

Grant Compliance Auditor Caitlin Ager walked supervisors through the FEMA funding process and the implications for Napa County, noting that final approved project funding can change at reconciliation: "Final approved project funding isn't known until reconciliation at the conclusion of all projects within a disaster," she said. Ager said the county is a Cal OES subrecipient, which creates additional compliance complexity.

County staff told the board that, since 2014, Napa County has received about $20,000,000 in FEMA/Cal OES public assistance for disaster projects; $7,200,000 has already been released and about $13,000,000 remains restricted. Staff estimated an additional $5,300,000 may still be owed by FEMA/Cal OES for closed projects, a figure subject to change as agencies complete reconciliations.

Schulze and Ager also reviewed why the county keeps funds restricted until Cal OES issues an audit waiver letter and how the Disaster Recovery Reform Act (a revision to the Stafford Act) established a three‑year project-level window for potential clawbacks. Staff said the county currently has 127 disaster projects at various stages of review and closeout and that release timing is driven largely by the three‑year audit clock.

The board approved the budgetary actions staff requested, which include the $4.3 million release to various subdivisions and an appropriation increase to repay Cal OES advances of $71,971. Supervisor Jack Alessio made the motion to approve the recommended actions and Supervisor John Manfrie seconded; the vote was unanimous.

Supervisors used the discussion to clarify how amounts relate to the recommended budget and to confirm that projects not submitted to Cal OES or FEMA (including some 2025 storm responses) were not part of the federal funding reconciliation.

The auditors' presentation and the board action close this agenda item; staff will carry out the transfers and continue to manage project reconciliations with Cal OES and FEMA.