Supplemental Appropriations for the 2004 Hurricanes and Other Disasters
CRS Report for Congress
Supplemental Appropriations for the 2004
Hurricanes and Other Disasters
Updated September 1, 2005
Specialist in American National Government
Government and Finance Division
Ralph M. Chite
Specialist in Agricultural Policy
Resources, Science, and Industry Division
Congressional Research Service ˜ The Library of Congress
Supplemental Appropriations for the 2004 Hurricanes
and Other Disasters
After a series of devastating hurricanes struck Florida and other states in the
summer of 2004, the 108th Congress passed two emergency supplemental
appropriations statutes that provided an estimated $16.475 billion to areas stricken
by the hurricanes and other natural disasters. The House and Senate quickly
approved legislation (H.R. 5005) the day after President Bush submitted a request on
September 6, 2004, for $2 billion in FY2004 funding, largely in response to the
devastation caused by Hurricanes Charley and Frances in Florida. The President
signed the bill into law (P.L. 108-303) on September 7. All of the $2 billion was for
assistance provided by the Federal Emergency Management Agency (FEMA).
The second supplemental, this one coming in FY2005, largely reflected four
other requests submitted to Congress after Hurricanes Ivan and Jeanne continued the
run of damage in Florida and other southern and eastern states. After weeks of
debate, Congress agreed to incorporate revised provisions from a House-passed
supplemental disaster measure (H.R. 5212) into the FY2005 Military Construction
Appropriations Act (H.R. 4837). President Bush signed the legislation (P.L. 108-
324) on October 13, 2004. Division B of P.L. 108-324 contained $14.475 billion in
supplemental funding, including $6.5 billion for additional FEMA assistance, $3.45
billion for agricultural losses and recovery for 2003 and 2004, $1.2 billion for
emergency highway funds, and $929 million to cover the cost and administration of
Small Business Administration loans, among other provisions. A portion of the
agricultural spending was offset by a $2.858 billion reduction in spending authority
for an agricultural conservation program over a multi-year period, with reductions
beginning in FY2008.
While few debated the need for federal disaster assistance, considerable
discussion occurred on the scope of the legislation. Members representing
midwestern and western states contended that the continuing drought affecting their
farming constituents constituted a disaster that required aid beyond that previously
provided. The Administration did not request agricultural aid to producers in states
not affected by the hurricanes. The other issue that was a matter of public debate
focused on a proposed amendment in the House to fully offset the cost of the FY2005
supplemental through a proportional reduction in discretionary funds; the House
rejected the amendment.
This report will not be updated. However, the issues and responses that were
considered by Congress in 2004 are likely to be relevant to the 109th Congress as it
is faced with how to respond to Hurricane Katrina and other natural disasters in 2005.
Background on the Disaster Relief Fund................................5
Issues of Debate..................................................11
Unanticipated Events and Apportionment of Spending............11
Agricultural Disaster Assistance.................................13
USDA’s Florida Hurricane Disaster Assistance Program..........13
General Crop and Livestock Disaster Assistance................14
Additional Hurricane Loss Assistance.........................15
List of Tables
Table 1. FY2004, FY2005 Supplemental Appropriations After Hurricanes and
Table 2. Disaster Relief Fund, FY1974-FY2005.........................8
Supplemental Appropriations for the 2004
Hurricanes and Other Disasters
President Bush signed the Military Construction Appropriations Act, FY2005
(H.R. 5212, P.L. 108-324) on October 13, 2004. Division B of the statute comprises
the Emergency Supplemental Appropriations for Hurricane Disasters Assistance Act,
FY2005, which appropriated an estimated $14.5 billion for disaster assistance. The
President’s approval followed weeks of debate over four supplemental appropriations
requests submitted to Congress after a series of hurricanes struck Florida and other
states in August and September. Prior to approval of H.R. 5212, the 108th Congress
had expeditiously enacted legislation (H.R. 5005) on September 6 that appropriated
$2 billion for disaster relief needed in the immediate aftermath of Hurricanes Charles
and Frances; the President signed the legislation (P.L. 108-303) on September 7.
Another active Atlantic hurricane season has been experienced in 2005,
climaxing with the devastation caused by Hurricane Katrina when it struck the Gulfth
states on August 29, 2005. As the 109 Congress deliberates the federal response to
Hurricane Katrina, assistance similar to that provided following the 2004 hurricanes,
and described in this report, might be considered.
For the first time in roughly a hundred years a single state endured four major
hurricanes in the span of weeks. From mid-August through mid-September 2004,
Hurricanes Charley, Frances, Ivan, and Jeanne resulted in billions of dollars of1
insured and uninsured damages in Florida. In addition to the four major disaster
declarations issued by President Bush in Florida for each of the hurricanes,
declarations were issued after the hurricanes and related storms caused severe losses
in 11 other states.2 Also, agricultural producers in many midwestern and western
states have struggled for the last several years with drought conditions and other
weather extremes. Taken at a glance, calendar year 2004 may close as the most
financially costly year for natural disasters.
1 Damage estimates require weeks of effort as damage survey teams assess the extent of
destruction. According to one news report insured losses may exceed $20 billion; see
[http://www.klfy.com/Global/story.asp?S=2325982&nav=7k7cR7af], visited Oct. 6, 2004.
2 A “major disaster declaration” may be issued by the President if a governor certifies that
the affected state has suffered damages that require federal assistance. For more information
see page 9 of this report. For a list of states in which major disaster declarations have been
issued, see [http://www.fema.gov/news/disasters.fema?year=2004#diz], visited Oct. 7, 2004.
In light of these losses, and those associated with other disasters throughout the
nation, the Bush Administration submitted three supplemental appropriations
requests for FY2004 between September 6 and October 5, 2004 that totaled
approximately $14 billion. In response to the initial request on September 6 for $2
billion, Congress approved legislation (H.R. 5005) to appropriate the funds; the
President signed the bill on September 7 (P.L. 108-303). This appropriation was
provided to the Department of Homeland Security (DHS) to ensure that disaster relief
assistance administered by the Federal Emergency Management Agency (FEMA)
would be funded.
A subsequent funding request submitted to Congress on September 14 was
incorporated by the House into H.R. 5072, which received no action as Congress and
the Administration waited for the damage estimates associated with two other
Following the destruction caused by Hurricanes Ivan and Jeanne, the
Administration submitted three additional requests for supplemental funding on
September 27 and October 5 and 7, 2004.3 Two other bills were subsequently
introduced in the House (H.R. 5212, H.R. 5227) to appropriate supplemental FY2005
funds. Congress debated the provisions in the closing days (October 9 through 11)
of the second session. The House reportedly planned on incorporating the disaster
supplemental funding into the FY2005 appropriations bill (H.R. 4567) for the
Department of Homeland Security (DHS). The Senate had incorporated $3 billion
in emergency agricultural assistance into H.R. 4567 on September 14.
Just prior to the election recess conferees agreed to incorporate the FY2005
disaster supplemental into the FY2005 Military Construction Appropriations Act
(H.R. 4837). The President signed the bill into law (P.L. 108-324) on October 13,
including $6.5 billion for additional FEMA assistance, $3.45 billion for agricultural
losses and recovery for 2003 and 2004 disasters, $1.2 billion for emergency highway
funds, and $929 million to cover the cost and administration of Small Business
Administration loans, among other provisions. A portion of the agricultural spending
was offset by a $2.858 billion reduction in spending for an agricultural conservation
program over a multi-year period, with reductions beginning in FY2008.
3 The fifth request consolidated the second, third, and fourth requests that had previously
been submitted. For administration documents on all of the requests, see U.S. Office of
Management and Budget, “Estimate #9, FY2004 Emergency Supplemental: Department of
Homeland Security Federal Emergency Management Agency (FEMA), Disaster Relief
Associated with Hurricanes Charley and Frances,” available at [http://www.whitehouse.gov/
omb/budget/amendments/supplemental_9_6_04.pdf]; “Estimate #11, Emergency
Supplemental: Hurricanes Charley and Frances (Various Agencies), 9/14/04,” available at
[http://www.whitehouse.gov/ omb/budget/ame ndments/supplemental_9_14_0 4.pdf];
“Estimate #13, Emergency Supplemental: Hurricanes Ivan and Jeanne (Various Agencies),
pdf]; “Estimate #14, Emergency Supplemental: Hurricanes Charley, Frances, Ivan and
Jeanne (Various Agencies, 10/5/04,” at [http://www.whitehouse.gov/omb/budget/
amendments/supplemental_10_5_04.pdf]; and “Supplemental — October 7, 2004:
Additional Hurricane Related Assistance, 10/7/04,” at [http://www.whitehouse.gov/omb/
budget/amendments/supplemental_10_7_04.pdf], all visited Oct. 12, 2004.
Table 1 of this report presents summary information on the administration
requests and congressional action taken on supplemental disaster relief funding for
FY2004 and FY2005.
Table 1. FY2004, FY2005 Supplemental Appropriations After
Hurricanes and Other Disasters
($ in millions)
Federal agency/accountRequest AP.L. 108-303 &P.L. 108-324 A,B
Department of Agriculture
Commodity Credit Corporation — Disaster Assistance4193,016
Farm Service Agency100100
Natural Resources Conservation Service250250
Rural Community Advancement Program6868
Rural Housing Service1818
Dept. of Agriculture subtotal (before offset) C9683,565
Department of Commerce
National Oceanic & Atmospheric Administration1221
Department of Defense — Civil, Corps of Engineers
General investigations, construction6363
Operation and maintenance, general145145
Flood control and coastal emergencies148148
Flood control, specified states616
Dept. of Defense — Civil, subtotal362372
Department of Defense — Military
Operation and Maintenance 751751
Defense Health Program1212
Revolving and Management Funds44
Department of Defense — Military, subtotal1,0801,080
Department of Health and Human Services
Dept. Management / Health and social services5050
Department of Homeland Security
Emergency Preparedness and Response / D
Disaster relief fund 8,5008,500
Dept. of Homeland Security / Coast Guard3333
Dept. of Homeland Sec. subtotal8,5338,533
Department of Housing and Urban Development
Community planning and development150150
Department of the Interior
Dept. of the Interior / Fish and Wildlife Service4141
Federal agency/accountRequest AP.L. 108-303 &P.L. 108-324 A,B
Dept. of the Interior / U.S. Geological Survey11
Dept. of the Interior / National Park Service5151
Dept. of the Interior / Bureau of Reclamation05
Dept. of the Interior, subtotal9298
Department of Justice
Federal Prison System2424
Department of Transportation
Federal Aviation Administration E3030
Federal Highway Administration F1,2021,202
Dept. of Transportation subtotal1,2321,232
Department of Veterans Affairs
Construction and Operating Expenses3737
Dept. of Vet. Affairs subtotal124124
Agency for International Development100100
Environmental Protection Agency33
National Aeronautics and Space Administration126126
Small Business Administration 929929
Executive Office of the President / Amer. Red Cross7070
Other Agencies Subtotal 1,2281,228
P.L. 108-303 (Total: all for Disaster Relief Fund)2,0002,000
P.L. 108-324 (Total before offset)11,85514,475
Grand Total: (Before offset)13,85516,475
Dept. of Agriculture Conservation Security ProgramC
Grand Total — (After offset) G13,85513,617
Sources: A Data on administration requests obtained from Congressional Budget Office computer run dated
October 14, 2004 and from “Supplemental — October 7, 2004: Additional Hurricane Related Assistance,
10/7/04,” at [http://www.whitehouse.gov/omb/budget/amendments/supplemental_10_7_04.pdf], visited Oct.
12, 2004. P.L. 108-324 based on conference report text available at [http://www.congress.gov/cgi-lis/cpquery/
R?cp108:FLD010:@1(hr773)], visited Oct. 22, 2004. See also data at the House Appropriations Committee
website, [http://appropriations.house.gov/_files/disastersuppconf.pdf], visited Oct. 22, 2004.B
P.L. 108-303 appropriated $2 billion for the Disaster Relief Fund, as requested. All other supplemental
funding was provided in P.L. 108-324. C
P.L. 108-324 includes a cap on the authorized level of spending for the Conservation Security Program, a
USDA mandatory program authorized by the 2002 farm bill. The cap is over a 10-year period that does not take
effect until FY2008. Total savings of $2.8 billion reflected at the end of Table 1.D
The total request and appropriation includes $2 billion in P.L. 108-303 and $6.5 billion in P.L. 108-324.E
Funds derived from the airport and airway trust fund.F
Funds derived from the Highway Trust Fund.G
Total reflects rounding.
Background on the Disaster Relief Fund
Roughly half of the supplemental funds appropriated in the wake of the four
hurricanes (and other disasters) will be used by DHS in administering relief to
stricken communities and victims. These funds are derived from the Disaster Relief
Fund (DRF) administered by FEMA. This section provides background information
on the DRF and the authority under which its resources are allocated.
P.L. 108-303 appropriated $2 billion to the disaster relief fund (DRF)
administered by the Department of Homeland Security (DHS). DHS uses DRF funds
to provide assistance to individuals, families, state and local governments, and certain4
nonprofit organizations, as authorized by the Stafford Act. Stafford Act aid is
available after the President issues a declaration that federal assistance is needed to
supplement the resources of states and localities that are overwhelmed by particularly
significant catastrophes.5 Federal assistance supported by DRF money is used by
states, localities, and certain non-profit organizations to provide mass care, restore
damaged or destroyed facilities, clear debris, and aid individuals and families with
uninsured needs, among other activities. In calendar year 2003, President Bush
issued 56 major disaster declarations; thus far in calendar year 2004, 61 such6
declarations have been issued.
Five types of declarations may be issued by the President or the Secretary of
DHS, summarized as follows:7
!Major disaster. The President issues a major disaster declaration
after receiving a request from the governor of the affected state.8 A
declaration authorizes DHS to administer various federal disaster
assistance programs for victims of declared disasters. Each major
disaster declaration specifies the type of incident covered, the time
period covered, the types of disaster assistance available, the
counties affected by the declaration, and the Federal Coordinating
4 The Robert T. Stafford Disaster Relief and Emergency Assistance Act, 42 U.S.C. 5121
5 For more information on the Stafford Act and the DRF, see CRS Report RL32242,
Emergency Management Funding for the Department of Homeland Security: Information
and Issues for FY2005, by Keith Bea, Shawn Reese, Wayne Morrissey, Frank Gottron, and
C. Stephen Redhead.
6 For a list of major disaster declarations, see U.S. Federal Emergency Management Agency,
“Federally Declared Disasters by Calendar Year,” at [http://www.fema.gov/library/
drcys.shtm], visited Sept. 16, 2004.
7 Summaries adapted from testimony by FEMA in U.S. Congress, Committee on
Appropriations, Subcommittee on VA, HUD, and Independent Agencies, Departments of
Veterans Affairs and Housing and Urban Development, and Independent Agenciesthnd
Appropriations for 2001, hearing, 106 Cong., 2 sess., Feb. 29, 2000 (Washington: GPO,
8 For criteria considered in the declaration of a major disaster, see 44 CFR 206.48.
!Emergency. The declaration process for emergencies is similar to
that used for major disasters; the President may, however, issue an
emergency declaration without a gubernatorial request if primary
responsibility rests with the federal government.9 Under an
emergency declaration, the federal government funds and undertakes
emergency response activities, debris removal, and individual
assistance and housing programs. DRF expenditures for an
emergency are limited to $5 million per declaration unless the
President determines that there is a continuing need; Congress must
be notified if the $5 million ceiling is breached.
!Fire suppression. The Secretary of DHS is authorized to provide
fire suppression assistance to supplement the resources of
communities when fires threaten such destruction as would warrant
a major disaster declaration.
!Defense emergency. Upon request from the governor of an affected
state, the President may authorize the Department of Defense (DoD)
to carry out emergency work for a period not to exceed 10 days.
DoD emergency work is limited to work essential for the
preservation of life and property.
!Pre-declaration activities. When a situation threatens human
health and safety, and a disaster is imminent but not yet declared, the
Secretary of DHS may place agency employees on alert. DHS
monitors the status of the situation, communicates with state
emergency officials on potential assistance requirements, and
deploys teams and resources to maximize the speed and
effectiveness of the anticipated federal response and, when
necessary, performs preparedness and preliminary damage
The Homeland Security Act of 2002 (P.L. 107-296) transferred the authorities
and functions previously carried out by the Federal Emergency Management Agency
(FEMA) to DHS and charged the Secretary of Homeland Security with responsibility
for administering these activities. The Emergency Preparedness and Response
Directorate (EPR) of DHS, which includes FEMA, has primary responsibility for
allocating funds from the DRF for activities authorized by the Stafford Act.
Table 2 of this report lists appropriations made to the DRF since 1974. Prior
to FY1989, supplemental appropriations made to the DRF were approved
9 “The President may exercise any authority vested in him ... of this title with respect to an
emergency when he determines that an emergency exists for which the primary
responsibility for response rests with the United States because the emergency involves a
subject area for which, under the Constitution or laws of the United States, the United States
exercises exclusive or preeminent responsibility and authority. In determining whether or
not such an emergency exists, the President shall consult the Governor of any affected state,
if practicable. The President’s determination may be made without regard to subsection (a)
of this section.” 42 U.S.C. 5191(b).
infrequently and generally exceeded the amount originally appropriated in each fiscal
year by roughly $100 to $200 million.10 By comparison, since FY1989,
appropriations have exceeded $1 billion in each fiscal year and supplemental
appropriations have been approved in all but FY1991 and FY2000.
The last two columns of Table 2 show that a similar growth pattern has
developed for outlays from the DRF. Prior to FY1989, outlays from the DRF
averaged $568 million, and on only two occasions (Hurricane Frederic in FY1978
and the eruption of Mt. St. Helens in FY1980) exceeded $1 billion. Since 1989,
however, average annual outlays have exceeded $2 billion, due to significant
hurricanes (Hugo in FY1989, Andrew in FY1992, Floyd in FY1999), earthquakes
(Loma Prieta in FY1990, Northridge in FY1994), floods (Midwest floods of 1993,
Red River floods of 1995), the terrorist attacks of September 11, 2001, and the
sequence of four hurricanes in the summer of 2004.
10 An exception occurred in FY1980 after the eruption of Mt. St. Helens.
Table 2. Disaster Relief Fund, FY1974-FY2005
(millions of dollars, 2002 constant dollars)
Appropriations (available funds)
FY A Re q. O r i g . S upp. Nominal Constant Nominal Constant
75 100 150 50 200 591 206 609
76 187 187 0 187 517 362 999
77 100 100 200 300 770 294 754
78 150 115 300 415 997 461 1,108
79 200 200 194 394 876 277 616
80 194 194 870 1,064 2,175 574 1,173
81 375 358 0 358 668 401 746
82 400 302 0 302 526 115 201
83 325 130 0 130 217 202 337
85 100 100 0 100 156 192 299
86 194 100 250 350 533 335 511
87 100 120 B 0 120 178 219 325
88 125 120 0 C 120 173 187 269
89 200 100 D 1,108 1,208 1,674 140 194
90 270 98 E 1,150 1,248 1,668 1,333 1,781
92 F184 185 4,136 G 4,321 5,429 902 1,134
93 292 292 2,000 H 2,292 2,816 2,276 2,796
94 I1,154 226 J 4,709 4,935 5,935 3,743 4,502
95 320 320 K 3,275 3,595 4,235 2,116 2,492
96 320 222 K 3,275 K 3,497 4,042 2,233 2,581
97 320 L1,320 L3,300 4,620 5,248 2,551 2,898
98 M 2,708 320 N 1,600 1,920 2,155 1,998 2,242
99 O 2,566 P 1,214 Q 1,130 2,344 2,597 3,746 4,149
01 2,909 300 T5,890 6,249 3,217 3,413
02 U 1,369 664 V 7,008 V 12,160 12,677 3,947 4,114
03 1,843 800 W 1,426 W 2,199 2,255 8,541 8,761
041,9561,800 X2,275X2,042 Y2,068 Y3,044Y3,082
05 2,151 2,042 X 8,500 10,542 Z10,542 Y 3,363 Y 3,363
Total 24,240 16,360 48,988 72,099 84,455 50,648 60,224
Sources: U.S. President annual budget documents; appropriations legislation; U.S. Federal
Emergency Management Agency budget justifications. Constant dollar amounts based on CRS
calculations based on GDP (chained) price index in: U.S. President (Bush), Historical Tables, Budget
of the United States Government, Fiscal Year 2005 (Washington, 2004), pp. 184-185.
A Data in the request column generally represent the first budget request submitted by the
Administration each year and do not include amended or supplemental requests. Note, however,
additional detail in this column.
B In February 1987, a total of $57.5 million was rescinded and transferred from the DRF to the
Emergency Food and Shelter Program account (P.L. 100-6). That amount was returned to the fund
the same year in supplemental appropriations legislation enacted in July 1987 (P.L. 100-71).
C P.L. 100-202, the Continuing Appropriations Act for FY1988, appropriated $120 million for disaster
relief. According to FEMA, the original appropriation for that fiscal year was $125 million, but $5
million was transferred to the Department of Labor for “low income agriculture workers.”
D Supplemental funds were included in P.L. 101-100, continuing appropriations legislation enacted
after Hurricane Hugo struck in September 1989. According to FEMA, this amount was “referred to
as a supplemental but was an increase in the original appropriation during a continuing resolution.”
E P.L. 101-130, enacted after the Loma Prieta earthquake, appropriated $1.1 billion in supplemental
funding for FY1990. In addition, $50 million was appropriated in P.L. 101-302, dire emergency
supplemental appropriations legislation. Table 2 does not reflect a $2.5 million transfer from the
President’s unanticipated needs fund.
F FY1992 request does not include the budget amendment of $90 million submitted by the
Ad mi ni st r a t i o n.
G Appropriations for FY1992 included a $943 million dire emergency supplemental in P.L. 102-229,
enacted in the fall of 1991 after Hurricane Bob; $300 million after the Los Angeles riots and flooding
in Chicago (spring of 1992) in P.L. 102-302; and $2.893 billion in P.L. 102-368 after Hurricanes
Andrew and Iniki, Typhoon Omar, and other disasters.
H Total for FY1993 includes the $2 billion supplemental approved after the Midwest floods of 1993
I The original FY1994 budget request was $292 million. On July 29, 1993, a supplemental request
of $862 million was sent by President Clinton to Congress.
J Supplemental appropriations for FY1994 enacted after the Northridge earthquake struck Los
Angeles (P.L. 103-211).
K Additional supplemental appropriation approved for Northridge earthquake costs (P.L. 104-19) for
FY1995, with the same amount ($3.275 billion) reserved for a contingency fund for FY1996.
However, $1 billion of the contingency fund was rescinded in FY1996 omnibus appropriations, P.L.
104-134. In the same legislation, another $7 million was also appropriated to other FEMA accounts
for costs associated with the bombing of the Alfred P. Murrah federal building in Oklahoma City.
L The FY1998 budget appendix (p. 1047) noted a transfer of $104 million from the disaster relief fund
in FY1996. In the FY1997 appropriations act (P.L. 104-204), $1 billion that had been rescinded in
FY1996 (P.L. 104-134) was restored, and $320 million in new funds were appropriated. Supplemental
appropriations of $3.3 billion were approved in P.L. 105-18 after flooding in the Dakotas and
Minnesota, and after storms in other states were declared major disasters. The legislation specified,
however, that of the total, $2.3 billion was to be available in FY1998 only when FEMA submitted a
cost control report to Congress. This requirement was met, and the funding was made available in
M The FY1998 request consisted of a $320 million base amount plus $2.388 billion “to address actual
and projected requirements from 1997 and prior year declarations.” (Budget Appendix FY1998, p.
1047). Does not include $50 million requested for the DRF for mitigation activities.
N Supplemental appropriations legislation (P.L. 105-174) for FY1998 approved for flooding associated
with El Niño and other disasters.
O The FY1999 request consisted of $307.8 million for the DRF and an additional $2.258 billion in
contingency funding to be available when designated as an emergency requirement under the Balanced
Budget Act of 1985, as amended.
P The FY1999 omnibus appropriations act (P.L. 105-277, 112 Stat. 2681-579) included $906 million
for costs associated with Hurricane Georges, flooding associated with El Niño, and other disasters.
Q Emergency supplemental appropriations for FY1999 (P.L. 106-31) included $900 million for
tornado damages as well as $230 million for unmet needs, subject to allocation directions in the
conference report (H.Rept. 106-143).
R FY2000 appropriations act (P.L. 106-74, 113 Stat. 1085) included disaster relief funding as follows:
$300 million in regular appropriations and $2.480 billion designated as emergency spending for costs
associated with Hurricane Floyd and other disasters. In addition, the Consolidated Appropriations Act
(P.L. 106-113) authorized the Director of FEMA to use up to $215 million in disaster relief funds
appropriated in P.L. 106-74 for the purchase of residences flooded by Hurricane Floyd, under
S Supplemental appropriations legislation (P.L. 106-246) authorized that $77 million from the DRF
to be used for buyout and relocation assistance for victims of Hurricane Floyd. The act also
appropriated $500 million in a separate account for claim compensation and administrative costs
associated with the Cerro Grande fire that destroyed much of Los Alamos, New Mexico.
T P.L. 107-38 appropriated $40 billion in response to the terrorist attacks of September 11, 2001.
Pursuant to the statute, these funds for FY2001 were allocated by the Office of Management Budget
from the Emergency Response Fund (ERF). Of the total appropriated in P.L. 107-38 after the
September 11 attacks, $4.4 billion were allocated for FY2001 through P.L. 107-117 (115 Stat. 2338).
The total available for obligation for FY2001 ($5.9 billion) taken from FEMA Justification of
Estimates, FY2003, p. DR-2.
U Request for FY2002 did not include funding for the Disaster Relief Contingency Fund.
V Congress appropriated a total of $7.008 billion for FY2002 in P.L. 107-117 and 107-206 to meet
additional needs associated with the terrorist attacks. Total funds available ($12.16 billion) include
a transfer from the Transportation Security Administration, $1 billion released from the Emergency
Contingency Fund, and other sources. See Department of Homeland Security, Emergency
Preparedness and Response Directorate, Justification of Estimates, FY2004, p. DR-2.
W Includes $442 million in P.L. 108-69 and $938 million in P.L. 108-83 to meet needs associated with
tornadoes, winter storms, the recovery of wreckage of the Space Shuttle Columbia and other disasters.
Also, funds appropriated in these measures and in the FY2004 appropriations act for DHS (P.L. 108-
90) have been used for costs associated with Hurricane Isabel. Total of $2.199 billion available taken
from: Department of Homeland Security, Emergency Preparedness and Response Directorate,
Justification of Estimates, FY2005, p. FEMA-18.
X P.L. 108-106 which primarily addressed reconstruction costs in Iraq and Afghanistan also contained
an appropriation of $500 million for needs arising from disasters in the fall of 2003, including
Hurricane Isabel and the California fires. Section 4002 of the act designates the funds an emergency
requirement pursuant to the budget resolution adopted by Congress (H.Con.Res. 95), but the
Consolidated Appropriations Act for FY2004 (Sec. 102(a), Division H, P.L. 108-199) rescinded $225
million of the $500 million appropriated in P.L. 108-106. Total of $2.043 billion taken from:
Department of Homeland Security, Emergency Preparedness and Response Directorate, Justification
of Estimates, FY2005, p. FEMA-18. P.L. 108-303, enacted after Hurricanes Charley and Frances
struck Florida, appropriated $2 billion to the DRF and gave discretion to DHS to transfer $300 million
to the Small Business Administration for disaster loans. P.L. 108-324, Division B of the Military
Construction Appropriations Act for FY2005, appropriated an additional $6.5 billion to the DRF.
Y Outlay data and constant dollar calculations based on estimates.
Z Funds presented in current dollars.
Issues of Debate
Members of Congress rarely engage in controversy or debate on federal disaster
assistance funding measures. Many constituents, Members of Congress, and
analysts generally agree that the federal government has an important role in the
immediate response to significant catastrophes, as well as in long-term recovery
efforts. Some debate may occur, however, on the types of activities to be funded
through this request, the addition of provisions in supplemental appropriations
legislation for activities not always seen to be emergency needs, and activities funded
through supplemental appropriations, among other issues. The remainder of this
report contains information on some of the issues raised in the debate over the
FY2004 and FY2005 disaster assistance supplemental requests considered and acted
upon by Congress.
Unanticipated Events and Apportionment of Spending. One issue
concerns the anticipation of catastrophes, notably hurricanes, and the rate at which
funds are depleted from the DRF. Hurricanes Charley and Frances struck during the
congressional recess. By mid-August the DRF, which is used for all disaster and
emergency declarations issued by the President, contained insufficient funds to meet
even the immediate response needs.11 Accordingly, the schedule DHS had
established for obligating funds, pursuant to statutory apportionment requirements,
had to be revised.12 In a letter to the chairman of the House Appropriations
Committee, an OMB official reported that in light of the immediate needs, “it will
be necessary to obligate funds at a rate that will exhaust amounts currently
appropriated to fund immediate disaster response efforts involving the safety of
human life and the protection of property.”13 Expediting the obligation rate, OMB
noted, required expeditious passage of supplemental appropriations “[b]ecause of the
unanticipated magnitude of the destruction caused and anticipated to be caused by
this season’s hurricanes.”
The notification OMB gave to Congress on September 3 makes reference to an
exception to the statutory apportionment requirements.14 In essence, DHS cannot
obligate funds from the DRF in excess of the amount appropriated and must obligate
11 Telephone conversation between the author and congressional staff, September 7, 2004.
12 “An appropriation for an indefinite period and authority to make obligations by contract
before appropriations shall be apportioned to achieve the most effective and economical
use.” 31 U.S.C. 1512.
13 Letter from Joshua B. Bolten, Director, Office of Management and Budget, to the
President, September 6, 2004.
14 “Except as provided ..., an official may make, and the head of an executive agency may
request, an apportionment under section 1512 of this title that would indicate a necessity for
a deficiency or supplemental appropriation only when the official or agency head decides
that the action is required because of ... (B) an emergency involving the safety of human
life, the protection of property, or the immediate welfare of individuals when an
appropriation that would allow the United States Government to pay, or contribute to,
amounts required to be paid to individuals in specific amounts fixed by law or under
formulas prescribed by law, is insufficient.” 31 U.S.C. 1515(b)(1).
funds from the DRF effectively and economically. DHS (and other departments and
agencies) may, however, expedite the rate of obligation for reasons specified in the
statute. Due to the immediate needs that resulted from the two hurricanes, OMB
contended that the exception was appropriately invoked. As noted in the OMB
notice, this change in the obligation rate (apportionment) necessitated supplemental
appropriations to provide funds for the response to the hurricanes and other disasters.
While Congress theoretically could have refused to appropriate the requested
supplemental funds, it is not unreasonable to have expected positive action. Some
may argue, however, that congressional power over the purse is compromised by
having DHS and OMB decide that supplemental appropriations are necessary. That
decision arguably rests with Congress.
While the situation that led to enactment of P.L. 108-303 was resolved
expeditiously, one may conceive that future catastrophic disasters (including terrorist
attacks more devastating than those of September 11, 2001) could occur in the future
while Congress is in recess, or in adjournment. The revision of the apportionment
rate from the DRF, and the resulting press to enact supplemental appropriations,
might be alleviated in the future if Congress were to address the issue. Options for
congressional action include:
!Congress could extend to the Secretary of DHS the authority
currently held by the Secretary of Defense (and the Secretary of
Transportation for the Coast Guard) to obligate funds from the DRF
on a deficiency basis under specified circumstances.15 As the Coast
Guard has been transferred from the Department of Transportation
to DHS, it may be argued that the Secretary of DHS has this
authority when the Coast Guard operates as a service to the Navy.
!In light of advances made in hurricane prediction and projections of
storm intensity, it may be argued that hurricanes may be foreseen
and anticipated, at least to a degree adequate enough for Congress to
consider supplemental appropriations in late spring or early summer
of each year, prior to the August district work period.16
!Congress could appropriate reserve funds that would be released to
DRF for obligation if specified conditions exist. For example, over
$2 billion appropriated for the DRF in FY1998 was only made
available “until the Director of the Federal Emergency Management
15 “No contract or purchase on behalf of the United States shall be made, unless the same
is authorized by law or is under an appropriation adequate to its fulfillment, except in the
Department of Defense and in the Department of Transportation with respect to the Coast
Guard when it is not operating as a service in the Navy, for clothing, subsistence, forage,
fuel, quarters, transportation, or medical and hospital supplies, which, however, shall not
exceed the necessities of the current year.” 41 U.S.C. 11.
16 Perhaps the most prominent forecasting models used by a team of researchers at Colorado
State University, headed by Dr. William Gray. See [http://hurricane.atmos.colostate.edu/
forecasts/], visited Sept. 9, 2004.
Agency submits to the Congress a legislative proposal to control
disaster relief expenditures including the elimination of funding for
certain revenue producing facilities.”17
Agricultural Disaster Assistance18
Background. The late summer 2004 hurricanes damaged or destroyed
significant portions of Florida’s agricultural production, particularly citrus trees,
vegetables, and nursery products. Various other parts of the nation also have suffered
farm production losses over the past year caused by prolonged drought, floods,
freezes, and other weather-related disasters. Generally, farm production losses are not
eligible for FEMA assistance, but instead are covered under an assortment of ongoing
programs administered by the U.S. Department of Agriculture (USDA). These
include disaster loans, the federal crop insurance program, and the noninsured crop
disaster assistance program.19
When major disasters affect widespread portions of the nation, Congress
traditionally has supplemented these ongoing USDA programs with emergency crop
loss payments, livestock feed assistance and other ad-hoc programs. Between fiscal
years 1988 and 2003, Congress approved nearly $17 billion in emergency crop loss
payments, and approximately $2.6 billion in livestock and other emergency farm20
To assist farmers with more recent production losses, congressional and
administrative action has taken place on two fronts: (1) USDA announced a new
Florida Hurricane Disaster Assistance Program, which is expected to make an
estimated $500 million in direct disaster payments to Florida citrus, vegetable, and
nursery growers; and (2) Congress approved a $3.5 billion supplemental
appropriation for agriculture disaster assistance in the FY2005 military construction
appropriation act (P.L. 108-324, H.R. 4837). It includes $658.5 million for damages
caused by hurricanes and other storms in 2004 and an estimated $2.9 billion in
general crop and livestock disaster assistance for eligible producers nationwide. The
$2.9 billion was offset by a comparable reduction in funding for a mandatory
agriculture conservation program in future years.
USDA’s Florida Hurricane Disaster Assistance Program. The
Administration has begun implementing a new agricultural disaster payment
program designed to assist any Florida county that was declared a disaster area as a
result of either Hurricane Charley, Frances, or Jeanne. The new Florida Hurricane
17 P.L. 105-18, 111 Stat. 200.
18 This section prepared by Ralph Chite, Resources, Science, and Industry Division, CRS.
19 For more information on these and other USDA assistance programs, see CRS Report
RS21212, Agricultural Disaster Assistance, by Ralph Chite.
20 For more details on this spending, see CRS Report RL31095, Emergency Funding for
Agriculture: A Brief History of Supplemental Appropriations, FY1989-FY2005, by Ralph
Disaster Assistance Program did not require a new appropriation.21 Instead, the
program uses existing USDA Section 3222 funds (estimated by USDA at more than
$500 million) to provide direct disaster payments to producers of citrus, vegetables
and nursery crops based on estimated losses. Sign-up began October 5 for citrus
assistance and October 20 for vegetable and nursery crops. Recipients are subject to
an $80,000 payment limit, and must have adjusted gross income under $2.5 million
(which is waived if more than 75% of income is derived from farming or forestry).
General Crop and Livestock Disaster Assistance. Of the estimated
$3.5 billion in agricultural disaster assistance provided in the FY2005 military
construction appropriations act (P.L. 108-324), approximately $2.9 billion is for
additional crop disaster payments, livestock feed assistance, and tree replanting
assistance. Much of this disaster assistance is expected to benefit regions that have
experienced multiple years of drought, and other areas that were affected by a late
summer frost and other disasters.
Fiscal conservatives had insisted that the cost of any agricultural assistance for
disasters other than the 2004 hurricanes be offset with reductions in other USDA
programs. Supporters of farm and conservation programs were opposed to reducing
spending for any farm bill programs to pay for disaster assistance, and contended that
all natural disasters should be treated equally. Congress did adopt a $2.9 billion
reduction in spending authority for the Conservation Security Program, a mandatory
USDA program authorized by the 2002 farm bill (P.L. 107-171) . However, the
offset will not take effect until FY2008, after lawmakers write a new farm bill.
Within a couple of days after final congressional action on P.L. 108-324, the Senate
adopted a resolution (S.Res. 465) instructing conferees on the FY2005 agriculture
appropriations bill (H.R. 4766) to restore any cuts to the CSP. Conference on this
measure is pending.
P.L. 108-324 uses USDA’s Commodity Credit Corporation (CCC) to fully fund
payment formulas for three disaster programs — crop loss assistance, livestock
assistance, and tree assistance. The Congressional Budget Office (CBO) estimates
the cost of these three programs at $2.35 billion for crop losses, $475 million for
livestock assistance, and $35 million for tree replantings. If these estimates fall short
of program needs, CCC funds are available for any shortfall.
Crop loss payments are to be implemented in the same fashion as the 2000 crop
disaster program. A crop producer would be eligible for assistance if crop losses due
to any natural disaster were in excess of 35% in either 2003, 2004, or 2005. (A
producer must choose one of the three years. The only eligible 2005 crop losses are
those caused by a 2004 hurricane or tropical storm.) For losses in excess of the 35%
21 For more information on this program, see [http://disaster.fsa.usda.gov/fl_hurricane.htm],
visited Oct. 22, 2004.
22 “Section 32” is a permanent appropriation that since 1935 has earmarked the equivalent
of 30% of annual customs receipts to support the farm sector through a variety of activities.
Perhaps the best-known use of Section 32 funds is USDA’s direct purchases of meats,
poultry, fruits, vegetables, and fish, which are diverted mainly to school lunch and other
domestic food programs.
threshold, an eligible producer can receive a payment of up to 65% of the relevant
price for the commodity. Payments will be made to all eligible producers regardless
of whether a farmer was in a declared disaster area. Recipients are subject to an
$80,000 per person payment limit. Total payments received under this act combined
with crop insurance payments and the sale of the harvested crop cannot exceed 95%
of what the value of the crop would have been in the absence of the losses. The
applicant’s adjusted gross income must be under $2.5 million, but the limitation is
waived if more than 75% of income is derived from farming. Any Florida producer
that receives a payment under USDA’s Florida Hurricane Disaster Assistance
Program (see above) is ineligible for a crop loss payment provided by P.L. 108-324.
The act also sets aside $50 million for Virginia and $3 million for North Carolina for
2003 crop year losses, and allows only these states to receive crop loss payments for
two of the eligible years.
Also included in the total is necessary funding for a Livestock Assistance
Program (LAP), which would provide direct payments to eligible livestock producers
who suffered grazing losses due to a natural disaster. The bill requires the program
to be modeled after the LAP implemented in 2000. Under this proposed program,
a livestock producer would be eligible for LAP benefits when a natural disaster
caused the producer in an approved county to suffer a 40% or greater loss of grazing
for three or more consecutive months during either 2003 or 2004. The livestock
producer would be eligible for payments for either year, but not both.
Finally, necessary funds are provided to fully fund the Tree Assistance Program
(TAP), which was authorized by the 2002 farm bill (P.L. 107-171) but did not receive
any regular appropriations for FY2004. TAP provides financial assistance to orchard
growers to help them replant eligible trees, bushes, and vines that are damaged or
destroyed by a natural disaster. A grower who lost more than 15% of eligible trees
to a natural disaster can be reimbursed for 75% of the cost of replanting eligible
losses that occurred between December 1, 2003, and December 31, 2004. Payments
are limited to 500 acres and no more than $75,000 per person. The act provides an
additional $15 million to eligible forest land owners who suffered tree losses during
the same period.
Additional Hurricane Loss Assistance. An additional $658.5 million in
agricultural assistance was made available in P.L. 108-324 for regions that were
severely affected by the series of 2004 hurricanes and tropical storms. Included in
this amount is $250 million to repair waterways and watersheds; $150 million for
debris clean-up and repairs on farms through the Emergency Conservation Program;
$90 million for additional funding for the Florida Hurricane Disaster Assistance
Program for citrus, vegetable, and nursery crop losses; $68 million for rural
infrastructure and $18 million for rural housing loans and grants; $40 million for
sugarcane payments; $10 million for dairy production losses; $10 million for
cottonseed producers and first handlers; $10 million for private forest landowners;
$8.5 million for pecan producers; and $4 million for additional Farm Service Agency
administrative expenses associated with the hurricane assistance.
Hurricanes Charley, Frances, Ivan, and Jeanne, the continuing drought, and
other catastrophes serve as reminders that natural disasters, not just terrorist attacks,
devastate communities and have short-term (if not long-term) adverse economic
impacts. These hurricanes continue a decades-long trend that has required billions
of dollars in federal expenditures. The immediate shortfall in the DRF in early
September 2004 was resolved with the passage of H.R. 5005, P.L. 108-303. With
three other supplemental requests the Administration indicated to Congress that the
needs of stricken communities and victims required more aid. During the debate on
the supplemental request Members of Congress have considered issues such as the
funding of disasters and the American Red Cross.
Although farm disaster assistance has been enacted to cover farm production
losses in virtually every crop year between 1988 and 2004, some policymakers are
concerned that the continued availability of ad-hoc disaster payments might
discourage producers from purchasing a crop insurance policy. Several billion
dollars in additional premium subsidy were pumped into the federal crop insurance
program beginning in 2000, to enhance farmer participation and preclude the need
for ad-hoc disaster assistance. Participation in the crop insurance program has
increased significantly since 2000. However, when widespread disasters strike, the
political pressure continues to further compensate farmers for disaster losses.