Documenting disaster recovery costs.

Good record keeping is the basis for successful cost recovery from federal and state disaster assistance programs. Some points to consider.

Large disasters such as Hurricane Hugo, the Loma Prieta Earthquake and Hurricane Andrew have a major impact on individuals, governmental and nonprofit

organizations, and the impacted areas' economic activity and base. Governments expend resources in preparing for, responding to and recovering from a disaster event. As an event progresses from preparatory activities to response and repairs to postevent recovery, the last thought of those caught up in the long list of unanticipated activities is record keeping. Good record keeping, however, is the basis for successful cost recovery from federal and some state disaster assistance programs. Failure to produce adequate expenditure records of disaster-related activities will severely limit an affected jurisdiction's ability to recover disaster-related costs from these programs. Participation in federal disaster assistance programs is long term and detail intensive.

Federal Relief

When a disaster event is beyond the response capability of a state and impacted local government(s), the President may declare an emergency or major disaster upon a governor's request. This makes a variety of federal resources and programs available, one of which is administered by the Federal Emergency Management Agency (FEMA). FEMA is the lead agency to fund and coordinate the assistance programs under the Robert T. Stafford Disaster Relief and Emergency Act (PL 100-707, 1988- an amendment to PL 93-288). The Stafford Act substantially broadened the federal assistance programs and increased the states' responsibility and flexibility in administering the programs.

In addition to direct federal assistance, there are two major federal disaster assistance programs: 1) Individual Assistance (IA) to assist with loans and/or grants for losses suffered by individuals and families and 2) Public Assistance (PA) to assist with grants to public agencies and some nonprofit organizations. Eligible organizations with disaster-related costs and damages, such as a state or state entities, local governments and "governmental-type" nonprofit groups, become applicants (subgrantees) in FEMA's PA program. The state serves as the administrator (grantee) of this program. Public Assistance is a cost-sharing program. Under the Stafford Act, the federal government is required to fund not less than 75 percent of "net eligible costs;" the remaining nonfederal share is the responsibility of the state and local governments. In some severely impacted areas, the President may, and in some instances has, fully funded the net eligible costs.