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[House Report 115-418]
[From the U.S. Government Publishing Office]

115th Congress    }                                    {        Report
                        HOUSE OF REPRESENTATIVES
 1st Session      }                                    {       115-418

======================================================================

 
      DISASTER ASSISTANCE FAIRNESS AND ACCOUNTABILITY ACT OF 2017

                                _______
                                

 November 21, 2017.--Committed to the Committee of the Whole House on 
            the State of the Union and ordered to be printed

                                _______
                                

 Mr. Shuster, from the Committee on Transportation and Infrastructure, 
                        submitted the following

                              R E P O R T

    The Committee on Transportation and Infrastructure, to whom 
was referred the bill (H.R. 3176) to prohibit the Federal 
Emergency Management Agency from recouping certain assistance, 
and for other purposes, having considered the same, report 
favorably thereon with an amendment and recommend that the bill 
as amended do pass.

                                CONTENTS

                                                                   Page
Purpose of Legislation...........................................     2
Background and Need for Legislation..............................     2
Hearings.........................................................     3
Legislative History and Consideration............................     4
Committee Votes..................................................     4
Committee Oversight Findings.....................................     4
New Budget Authority and Tax Expenditures........................     4
Congressional Budget Office Cost Estimate........................     4
Performance Goals and Objectives.................................     7
Advisory of Earmarks.............................................     7
Duplication of Federal Programs..................................     8
Disclosure of Directed Rule Makings..............................     8
Federal Mandate Statement........................................     8
Preemption Clarification.........................................     8
Advisory Committee Statement.....................................     8
Applicability of Legislative Branch..............................     8
Section-by-Section Analysis of Legislation.......................     8
Changes in Existing Law Made by the Bill, as Reported............     9

    The amendment is as follows:
  Strike all after the enacting clause and insert the 
following:

SECTION 1. SHORT TITLE.

  This Act may be cited as the ``Disaster Assistance Fairness and 
Accountability Act of 2017''.

SEC. 2. RECOUPMENT OF CERTAIN ASSISTANCE PROHIBITED.

  (a) In General.--Notwithstanding section 3716(e) of title 31, United 
States Code, and unless there is evidence of civil or criminal fraud, 
the Federal Emergency Management Agency may not take any action to 
recoup covered assistance from the recipient of such assistance if the 
receipt of such assistance occurred on a date that is more than 3 years 
before the date on which the Federal Emergency Management Agency first 
provides to the recipient written notification of an intent to recoup.
  (b) Covered Assistance Defined.--In this section, the term ``covered 
assistance'' means assistance provided--
          (1) under section 408 of the Robert T. Stafford Disaster 
        Relief and Emergency Assistance Act (42 U.S.C. 5174); and
          (2) in relation to a major disaster declared by the President 
        under section 401 of such Act (42 U.S.C. 5170) on or after 
        January 1, 2012.

                         PURPOSE OF LEGISLATION

    H.R. 3176, as amended, prohibits the Federal Emergency 
Management Agency (FEMA) from recouping certain assistance 
granted to individuals.

                  BACKGROUND AND NEED FOR LEGISLATION

Federal Emergency Management Agency: History

    FEMA was established in 1979 by Executive Order 12148 by 
President Jimmy Carter in response to a number of massive 
disasters in the 1960's and 1970's. As a result of individual 
states trying to manage these disasters, the National Governors 
Association and others made a proposal to streamline and cut 
the number of agencies states were required to work with 
following a disaster. Prior to the creation of FEMA, the 
federal government's emergency response mechanisms were 
scattered among many agencies throughout government. The 
creation of FEMA helped to centralize these authorities and the 
coordination of the federal government's response to a 
disaster. The Disaster Relief Act of 1974 (Public Law 93-288), 
which constituted the statutory authority for most federal 
disaster response activities, especially of FEMA, was later 
amended by the Robert T. Stafford Disaster Relief and Emergency 
Assistance Act, also known as the Stafford Act (Public Law 100-
707).
    Following more than two decades as an independent agency, 
the Homeland Security Act of 2002 (P.L. 107-296) created the 
Department of Homeland Security (DHS), placed FEMA within DHS, 
dispersing FEMA's functions among various offices and 
directorates within the Department. In 2006, following 
Hurricanes Katrina and Rita and the intensive Congressional 
investigations and oversight, Congress enacted the Post-Katrina 
Emergency Management Reform Act of 2006 (PKEMRA) (Public Law 
109-295), which addresses key response roles and authorities 
and reconstituted FEMA within DHS.

Disaster response and recovery

    When the President declares a major disaster or emergency, 
the official declaration triggers certain federal response 
authorities and financial disaster assistance. In particular, 
when a declaration is made, the President is authorized to 
direct any federal agency, with or without reimbursement, to 
assist state and local governments and protect life and 
property. FEMA is responsible for coordinating federal agency 
response and ensuring the necessary federal capabilities are 
deployed at the appropriate place and time in support of state 
and local response efforts. In addition, FEMA provides direct 
support and financial assistance to states and local 
governments and individuals as authorized under the Stafford 
Act.

Disaster Assistance Fairness and Accountability Act of 2017

    In the wake of a Presidential major disaster declaration, 
FEMA may provide financial assistance to individuals who have 
necessary expenses and serious needs they are unable to meet by 
other means through the Individual and Households Program. 
While FEMA has implemented controls to avoid improper payments, 
errors are made. FEMA's current error rate for improper 
payments to individuals is less than two percent. H.R. 3176, as 
amended, institutes a three-year statute of limitations, which 
will prohibit FEMA from recouping assistance three years after 
it was received when there is no evidence of fraud. This will 
help ensure that any collection actions are initiated as 
quickly as possible.

                        HEARINGS AND ROUNDTABLES

    The Subcommittee on Economic Development, Public Buildings, 
and Emergency Management held the following hearings and 
roundtable discussions on subjects related to matters contained 
in H.R. 3176, as amended, during the 114th and 115th 
Congresses:
          ``Rebuilding after the Storm: Lessening Impacts and 
        Speeding Recovery'' held on January 27, 2015. The 
        purpose of the hearing was to launch an assessment of 
        the rising costs of disasters, the cost effectiveness 
        of disaster assistance, strategies to reduce disaster 
        losses, and the appropriate roles of government and the 
        private sector, and to consider reforms to save lives 
        through improved alerts and warning systems and search 
        and rescue.
          ``What is Driving the Increasing Costs and Rising 
        Losses from Disasters?'' held on March 18, 2015. The 
        purpose of the roundtable was to examine and discuss 
        data related to disaster costs, the trends observed 
        over time, and the projections for the future given the 
        policies in place today.
          ``The State of Pennsylvania and FEMA Region III are 
        Leaders in Mitigating Disaster Costs and Losses'' held 
        on May 28, 2015. The purpose of the roundtable was to 
        examine disaster costs and losses, focus on hazards 
        impacting Pennsylvania and the region, and identify 
        best practices for mitigating and avoiding disaster 
        impacts.
          ``Federal Disaster Assistance: Roles, Programs and 
        Coordination'' held on June 17, 2015. The purpose of 
        the roundtable was to examine and discuss federal 
        disaster assistance programs, the requirements and 
        effectiveness of those programs, and coordination among 
        various agencies and stakeholders.
          ``Controlling the Rising Cost of Federal Responses to 
        Disaster'' held on May 12, 2016. The purpose of the 
        hearing was to explore potential solutions and the 
        principles that should be driving solutions to lower 
        the overall costs of disasters and to help avoid 
        devastating losses.
          ``Building a 21st Century Infrastructure for America: 
        Mitigating Damage and Recovering Quickly from 
        Disasters'' held on April 27, 2017. The purpose of the 
        hearing is to examine how to protect infrastructure 
        against future disaster damage, how to lower overall 
        disaster costs, and to identify challenges facing FEMA 
        in responding to, recovering from, and mitigating 
        against disasters, both natural and manmade.

                 LEGISLATIVE HISTORY AND CONSIDERATION

    On July 11, 2017, Representative MacArthur (R-NJ) 
introduced H.R. 3176, a bill that prohibits FEMA from recouping 
assistance from individual applicants three years after the 
assistance was provided.
    On July 27, 2017, the Committee on Transportation and 
Infrastructure met in open session to consider H.R. 3176. The 
Committee considered an amendment offered by Congressman Lou 
Barletta (R-PA) which was adopted by voice vote. The Committee 
ordered the bill, as amended, reported favorably to the House 
by voice vote with a quorum present.

                            COMMITTEE VOTES

    Clause 3(b) of rule XIII of the Rules of the House of 
Representatives requires each committee report to include the 
total number of votes cast for and against on each record vote 
on a motion to report and on any amendment offered to the 
measure or matter, and the names of those members voting for 
and against. There were no recorded votes taken in connection 
with consideration of H.R. 3176, as amended, or ordering the 
measure reported. A motion to order H.R. 3176, as amended, 
reported favorably to the House was agreed to by voice vote 
with a quorum present.

                      COMMITTEE OVERSIGHT FINDINGS

    With respect to the requirements of clause 3(c)(1) of rule 
XIII of the Rules of the House of Representatives, the 
Committee's oversight findings and recommendations are 
reflected in this report.

               NEW BUDGET AUTHORITY AND TAX EXPENDITURES

    Clause 3(c)(2) of rule XIII of the Rules of the House of 
Representatives does not apply where a cost estimate and 
comparison prepared by the Director of the Congressional Budget 
Office under section 402 of the Congressional Budget Act of 
1974 has been timely submitted prior to the filing of the 
report and is included in the report. Such a cost estimate is 
included in this report.

               CONGRESSIONAL BUDGET OFFICE COST ESTIMATE

    With respect to the requirement of clause 3(c)(3) of rule 
XIII of the Rules of the House of Representatives and section 
402 of the Congressional Budget Act of 1974, the Committee has 
received the enclosed cost estimate for H.R. 3176, as amended, 
from the Director of the Congressional Budget Office:

                                     U.S. Congress,
                               Congressional Budget Office,
                                  Washington, DC, October 12, 2017.
Hon. Bill Shuster,
Chairman, Committee on Transportation and Infrastructure,
House of Representatives, Washington, DC.
    Dear Mr. Chairman: The Congressional Budget Office has 
prepared the enclosed cost estimate for H.R. 3176, the Disaster 
Assistance Fairness and Accountability Act of 2017.
    If you wish further details on this estimate, we will be 
pleased to provide them. The CBO staff contact is Robert Reese.
            Sincerely,
                                                Keith Hall,
                                                          Director.
    Enclosure.

H.R. 3176--Disaster Assistance Fairness and Accountability Act of 2017

    Summary: H.R. 3176 would establish a three-year statute of 
limitations on actions to recover certain improper assistance 
grants that the Federal Emergency Management Agency (FEMA) 
provided to individuals following a declared disaster. Under 
current law, FEMA has the authority to recover disaster 
assistance grants at any time after the date of disbursement.
    CBO estimates that H.R. 3176 would reduce FEMA's 
recoupments of improper payments, which are recorded as 
reductions in direct spending, by $30 million over the 2018-
2027 period. However, under current law, those amounts would be 
available for future disaster relief payments without further 
appropriation; thus, enacting the bill also would reduce direct 
spending by an equivalent amount, resulting in no net effect on 
direct spending over the next 10 years. Because fewer 
collections would be available to finance future disaster 
relief payments under the bill, H.R. 3176 would create a need 
for additional appropriations for those purposes. Assuming 
appropriation of the necessary amounts, CBO estimates that 
implementing the bill would cost $30 million over the 2018-2027 
period.
    Because enacting the bill would affect direct spending, 
pay-as-you-go procedures apply. Enacting the bill would not 
affect revenues. CBO estimates that enacting the legislation 
would not increase net direct spending or on-budget deficits in 
any of the four consecutive 10-year periods beginning in 2028.
    H.R. 3176 contains no intergovernmental or private-sector 
mandates as defined in the Unfunded Mandates Reform Act (UMRA) 
and would not affect the budgets of state, local, or tribal 
governments.
    Estimated cost to the Federal Government: The estimated 
budgetary effect of H.R. 3176 is shown in the following table. 
The costs of this legislation fall within budget function 450 
(community and regional development).

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                    By fiscal year, in millions of dollars--
                                                      --------------------------------------------------------------------------------------------------
                                                        2018    2019    2020    2021    2022    2023    2024    2025   2026   2027  2018-2022  2018-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                      INCREASES OR DECREASES (-) IN DIRECT SPENDING
 
Forgone Recoveries of Improper Payments:
    Estimated Budget Authority.......................      10       7       5       4       4       0       0      0      0      0        30         30
    Estimated Outlays................................      10       7       5       4       4       0       0      0      0      0        30         30
Reduced Spending from Recoveries:
    Estimated Budget Authority.......................     -10      -7      -5      -4      -4       0       0      0      0      0       -30        -30
    Estimated Outlays................................      -6      -7      -6      -4      -4      -2      -1      0      0      0       -27        -30
Net Change:
    Estimated Budget Authority.......................       0       0       0       0       0       0       0      0      0      0         0          0
    Estimated Outlays................................       4       0      -1       0       0      -2      -1      0      0      0         3          0
 
                                                     INCREASES IN SPENDING SUBJECT TO APPROPRIATION
 
Estimated Authorization Level........................      10       7       5       4       4       0       0      0      0      0        30         30
Estimated Outlays....................................       6       7       6       4       4       2       1      0      0      0        27         30
--------------------------------------------------------------------------------------------------------------------------------------------------------

    Basis of estimate: For this estimate, CBO assumes that H.R. 
3176 will be enacted near the end of 2017 and that the 
estimated amounts will be appropriated each year. Estimated 
outlays are based on historical spending patterns for the 
affected programs.

Direct spending

    Under current law, FEMA is required to recoup improper 
payments made during the course of providing disaster 
assistance. Improper payments can result from, among other 
things, duplication of benefits (for example, receipt of two 
insurance payments for the same damage), processing errors, or 
fraud. When notified by FEMA, recipients of improper payments 
must repay those amounts in full, set up a payment plan, or 
request that FEMA waive all or part of the repayment based on 
the recipient's ability to pay. If payment is not received, the 
Department of the Treasury assumes responsibility for 
collecting the debt (along with any applicable interest and fee 
charges) through federal and state payment deductions, 
administrative wage garnishment, or referral to a private 
collection agency. All payments received through the recoupment 
process are deposited in FEMA's Disaster Relief Fund (DRF) and 
are available to spend for future disasters without further 
appropriation.
    Under H.R. 3176, improper payments made to individuals 
would have to be recouped within three years of their 
disbursement. That limitation would not apply where there is 
evidence of fraud.
    According to data from a report by the Governmental 
Accountability Office, about three percent of the approximately 
$1.6 billion in FEMA individual assistance payments disbursed 
between 2012 and 2014 for Hurricane Sandy relief were improper 
or fraudulent. Based on a review of that report, CBO judges 
that few of those payments (less than 5 percent) were the 
result of fraudulent requests. Based on information from FEMA 
about the recoupment rate for improper payments after previous 
major disasters, CBO expects that about 25 percent of those 
payments have already been recouped. Thus, CBO estimates that 
$30 million in improper payments for individual assistance that 
are in the process of being recouped would no longer be 
collected under H.R. 3176. However, because those amounts would 
have been available to FEMA for future disaster relief payments 
without further appropriation, fewer collections also would 
reduce outlays, resulting in no net effect on direct spending 
over the 2018-2027 period.

Spending subject to appropriation

    CBO estimates that barring FEMA from recouping certain 
improper payments would reduce amounts deposited in the DRF by 
$30 million over the next five years. Assuming disaster relief 
payments stay at the same level, appropriations would need to 
increase; such spending would total $30 million over the 2018-
2027 period, CBO estimates.
    Pay-As-You-Go considerations: The Statutory Pay-As-You-Go 
Act of 2010 establishes budget-reporting and enforcement 
procedures for legislation affecting direct spending or 
revenues. The net changes in outlays that are subject to those 
pay-as-you-go procedures are shown in the following table.

 CBO ESTIMATE OF PAY-AS-YOU-GO EFFECTS FOR H.R. 3176, THE DISASTER ASSISTANCE FAIRNESS AND ACCOUNTABILITY ACT OF 2017, AS ORDERED REPORTED BY THE HOUSE
                                             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE ON JULY 27, 2017
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                                     By fiscal year, in millions of dollars--
                                                        ------------------------------------------------------------------------------------------------
                                                          2018   2019   2020    2021    2022    2023    2024    2025   2026   2027  2018-2022  2018-2027
--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                       NET INCREASE OR DECREASE (-) IN THE DEFICIT
 
Statutory Pay-As-You-Go Impact.........................      4      0      -1       0       0      -2      -1      0      0      0         3          0
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    Increase in long-term direct spending and deficits: CBO 
estimates that enacting the legislation would not increase net 
direct spending or on-budget deficits in any of the four 
consecutive 10-year periods beginning in 2028.
    Intergovernmental and private-sector impact: H.R. 3176 
contains no intergovernmental or private-sector mandates as 
defined in UMRA and would not affect the budgets of state, 
local, or tribal governments.
    Estimate prepared by: Federal Costs: Robert Reese; Impact 
on State, Local, and Tribal Governments: Rachel Austin; Impact 
on the Private Sector: Logan Smith.
    Estimate approved by: H. Samuel Papenfuss, Deputy Assistant 
Director for Budget Analysis.

                    PERFORMANCE GOALS AND OBJECTIVES

    With respect to the requirement of clause 3(c)(4) of rule 
XIII of the Rules of the House of Representatives, the 
performance goal and objective of this legislation is to 
implement a three-year statute of limitations on FEMA's ability 
to recoup disaster assistance funds from individuals in the 
absence of fraud.

                          ADVISORY OF EARMARKS

    Pursuant to clause 9 of rule XXI of the Rules of the House 
of Representatives, the Committee is required to include a list 
of congressional earmarks, limited tax benefits, or limited 
tariff benefits as defined in clause 9(e), 9(f), and 9(g) of 
rule XXI of the Rules of the House of Representatives. No 
provision in the bill, as amended, includes an earmark, limited 
tax benefit, or limited tariff benefit under clause 9(e), 9(f), 
or 9(g) of rule XXI.

                    DUPLICATION OF FEDERAL PROGRAMS

    Pursuant to clause 3(c)(5) of rule XIII of the Rules of the 
House of Representatives, the Committee finds that no provision 
of H.R. 3176, as amended, establishes or reauthorizes a program 
of the federal government known to be duplicative of another 
federal program, a program that was included in any report from 
the Government Accountability Office to Congress pursuant to 
section 21 of Public Law 111-139, or a program related to a 
program identified in the most recent Catalog of Federal 
Domestic Assistance.

                  DISCLOSURE OF DIRECTED RULE MAKINGS

    Pursuant to section 3(i) of H. Res. 5, 115th Cong. (2017), 
the Committee finds that enacting H.R. 3176, as amended, does 
not direct the completion of a specific rule making within the 
meaning of section 551 of title 5, United States Code.

                       FEDERAL MANDATE STATEMENT

    The Committee adopts as its own the estimate of federal 
mandates prepared by the Director of the Congressional Budget 
Office pursuant to section 423 of the Unfunded Mandates Reform 
Act (Public Law 104-4).

                        PREEMPTION CLARIFICATION

    Section 423 of the Congressional Budget Act of 1974 
requires the report of any Committee on a bill or joint 
resolution to include a statement on the extent to which the 
bill or joint resolution is intended to preempt state, local, 
or tribal law. The Committee states that H.R. 3176, as amended, 
does not preempt any state, local, or tribal law.

                      ADVISORY COMMITTEE STATEMENT

    No advisory committees within the meaning of section 5(b) 
of the Federal Advisory Committee Act are created by this 
legislation.

                  APPLICABILITY OF LEGISLATIVE BRANCH

    The Committee finds that the legislation does not relate to 
the terms and conditions of employment or access to public 
services or accommodations within the meaning of section 
102(b)(3) of the Congressional Accountability Act (Public Law 
104-1).

               SECTION-BY-SECTION ANALYSIS OF LEGISLATION

Section 1. Short title

    This section designates the short title as the ``Disaster 
Assistance Fairness and Accountability Act of 2017.''

Section 2. Recoupment of certain assistance prohibited

    This section provides that the Administrator shall not 
recover disaster assistance funds more than three years after 
they are received, absent fraud.
    Section two also defines the assistance covered under the 
act as ``assistance provided (1) under section 408 of the 
Robert T. Stafford Disaster Relief and Emergency Assistance Act 
(42 U.S.C. 5174); and (2) in relation to a major disaster 
declared by the President. . . .''

         CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

    H.R. 3176, as amended, makes no changes in existing law.

                                  [all]
```