Monthly Archives: September 2016

County Mismanagement Leads to Staggering FEMA Debt

County Mismanagement Leads to Staggering FEMA Debt

Henderson County, Ill. failed to comply with all federal regulations during management of Public Assistance projects and is now faced with a staggering $471,791 debt to FEMA.

In 2008, Illinois was hit with historic flooding. One of the counties impacted–Henderson County, Ill.–received federal funding through the Public Assistance program. [1] However, a Department of Homeland Security audit in 2011 revealed that the county received $3.7 million in ineligible funds from FEMA due to its failure to comply with the federal laws and regulations in completing the work (not 1ahendmapnecessarily that the work itself was ineligible for funding). [2] The county was able appeal and reduce the debt significantly to $471,791; however, that is still a sizable debt for the County of approximately 7,000 residents and a $49,612 to repay. [3] In an effort to try and buy the county time, the County’s Board decided to deplete two emergency reserve funds, bringing the debt down to $316,791.

What is unclear is exactly why, but if the County does not pay the debt back by June 2017, the county faces the loss of several vital agencies such as the Health Department, Sheriff’s Office, and Transportation Services. What concerns the board is that after making this “good faith payment”, the county may not have the funds to respond to the next looming flood.

Whats Happening?

This case looks like a great example of a successful 1st Appeal–despite what it looks–reducing the County’s debt to FEMA 89%. The County is trying to use it’s elected representatives to find ways to further reduce the struggling community’s debt, find sources to pay the debt, and keep vital services open. What else could the County do? They could possibly work out a payment plan or do a 2nd Appeal to FEMA. A 2nd Appeal may or may not yield better results though. Additionally, counties can actually file for bankruptcy under Chapter 9 of the U.S. Bankruptcy code. If they do so, it would likely just be a reorganization of the debt, rather than a charge-off. [4]

No matter how this case pans out, it will be one to follow and watch the outcome of.

References:

[1] Elizabeth Meyer, County Depletes Two Emergency Reserve Funds as Good-Faith Effort at Denting FEMA Debt, The Hawk Eye (Sept. 28, 2016). See generally Fed. Emergency Mgmt. Agency, Disaster Declarations for Illinois, (Sept. 29, 2016) https://www.fema.gov/disasters/grid/state-tribal-government/55?field_disaster_type_term_tid_1=All (Three major disaster declarations were declared in 2008 for Illinois for Severe Storms and Flooding: 1800 in Oct. 3, 2008; 1771 in Jun. 24, 2008; and 1747 in Mar. 7, 2008).

[2] Elizabeth Meyer, County Depletes Two Emergency Reserve Funds as Good-Faith Effort at Denting FEMA Debt, The Hawk Eye (Sept. 28, 2016).

[3] Henderson Cty., Henderson County EDC Demographics, (2008) http://www.hendersoncountyedc.com/About-Henderson/Demographics.

[4] See 11 USCA §901 et seq; U.S. Courts, Chapter 9 – Bankruptcy Basics, (2016), http://www.uscourts.gov/services-forms/bankruptcy/bankruptcy-basics/chapter-9-bankruptcy-basics (noting that the definition of a municipality under Chapter 9 of the Bankruptcy code is broad enough to include a County Government).

DoD Immediate Response Authority

DoD Immediate Response Authority

Though there are a plethora of issues surrounding use of the Military in a disaster; under the Immediate Response Authority, military commanders are allowed to provide limited assistance in life-threatening situations for limited durations.

What Is the Immediate Response Authority?

Defense Support of Civil Authorities (“DSCA”) is the federal policy that allows Department of Defense (“DoD”) resources—be it personnel, equipment, or facilities—to support entities at the state and local level to respond to disasters and other emergency conditions. [1] Under this program is the

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A handout aerial image released by the US Army on 15 September 2013 shows 2nd General Support Aviation Battalion, 4th Combat Aviation Brigade, 4th Infantry Division, soldiers evacuating fifth-grade students from Firewood Elementary. Courtney of Daily Mail UK. Click Image to read the full article.

Immediate Response Authority (“IRA”). Normally, a request for use of DoD assets to preform DSCA missions (i.e. respond to a crisis or emergency) requires the President or Secretary of Defense to approve a written request from the supported entity. [2] However, IRA allows for this request process to be short-circuited in some circumstances. IRA allows for military commanders to respond

to a DSCA request from local civil authorities under “imminently serious conditions [ ] if time does

not permit approval from higher authority….” [3] The key here is that the power to provide this response is temporary and limited to only situations which are aimed to “prevent human suffering, or mitigate great property damage.” [4] DSCA missions under IRA will generally end when the whole reason why the request was submitted in the first place ceases to exist. [5] Though a request cannot be denied for lack of agreement to, generally requesting jurisdictions should be prepared to reimburse the federal government for use of DoD assets under IRA. [6] There are some exceptions that would require a fact intensive analysis under other federal regulations and statutes.

What Does This Mean for the Emergency Manager?

First, this is not the source of authority that allows for military installations to enter into mutual aid agreements with local civil authorities. These types of mutual aid requests are considered to be “DSCA mutual aid” or “automatic aid” request and governed by DoD Instruction 6055.06 “DoD Fire and Emergency Services Program”. [7] Even under that program, we’re talking basic Fire & Medical first responders to support; not other uniformed personnel or equipment. IRA allows for the uniformed personnel and equipment, such as non-Fire or EMS personnel, aviation assets (such as helicopters) and engineering assets (such as bridges and boats) to possibly be used in a dire needs circumstance. What is important for the Emergency Manager in a military town, is to be sure they know who to talk to in these two circumstances. A good working relationship and talking to the lawyers and Staff Judge Advocates (the Military Commander’s in-house counsel) early can help iron out how and what to do when minutes count.

References

[1] 32 CFR §185.3 (West 2016).

[2] 32 CFR §185.4(c)-(d) (West 2016).

[3] 32 CFR §184.4 (g) (West 2016).

[4] 32 CFR §184.4 (g) (West 2016).

[5] 32 CFR §184.4(g)(2) (West 2016).

[6] 32 CFR §184.4(g)(3) (West 2016).

[7] DoDI 6055.06, DoD Fire and Emergency Services Program, 27 (Dec. 21, 2006). See generally 42 USCA §5195 (2016) (Policy purpose gives the sense that congress intends to allow federal to local mutual aid agreements in some circumstnaces).