The U.S. House of Representatives on Dec. 9 unanimously approved a bipartisan bill cosponsored by U.S. Rep. Garret Graves (R-LA) that would require the Federal Emergency Management Agency (FEMA) to pay interest on reimbursements to local governments and electrical cooperatives.
Specifically, the FEMA Loan Interest Payment Relief Act, H.R. 2672, would direct FEMA to provide financial assistance to a local government or electric cooperative as reimbursement for interest paid on a loan used for emergency or disaster recovery activities later paid for by FEMA assistance.
The interest that qualifies for reimbursement may not exceed the amount of interest that would have been paid if the loan’s interest rate were equal to the most recent prime rate, according to the congressional record bill summary.
“When disaster costs aren’t paid, our towns, cities and parishes often have to cut other government services to pay for or float disaster response and recovery efforts,” Rep. Graves said. “This means impacted communities are hit once by the disaster and hit again by FEMA. Our bill changes that.”
The congressman in April 2023 introduced H.R. 2672 alongside bill sponsor U.S. Rep. Neal Dunn (R-FL) and fellow cosponsor U.S. Rep. Darren Soto (D-FL). The bill now advances to the U.S. Senate for consideration.
“FEMA has no incentive to be efficient,” said Rep. Graves. “The Inspector General recently found that the disaster agency had $71 billion in outstanding reimbursement claims from state and local governments — some dating back over a decade.”
The U.S. House Transportation and Infrastructure Committee on Sept. 19 passed the measure, along with other pro-disaster victim bills authored by Rep. Graves, according to his staff.