59730 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

1The Cerro Grande Fire Assistance Act (Pub. L. 

106–246 (2001)) required FEMA to design and 

administer a program to fully compensate those 

who suffered injuries resulting from the Cerro 

Grande Fire. The Cerro Grande Fire resulted from 

a prescribed fire ignited on May 4, 2000, by 

National Park Service fire personnel at the 

Bandelier National Monument, New Mexico under 

an approved prescribed fire plan. That fire burned 

approximately 47,750 acres and destroyed over 200 

residential structures. The Cerro Grande Fire 

Assistance Act process is detailed in an Interim 

Final Rule (65 FR 52259 (Aug. 27, 2000) and a Final 

Rule (66 FR 15847 (Mar. 21, 2001) that is now 

codified at 44 CFR part 295. 

2 ‘‘On the flip side, economic strategies 

traditionally employed in the Santa Fe National 

Forest assessment area, typically combining 

ranching, acequia agriculture, wood collection and 

other communal land uses, appear to be less viable 

in the context of rising land values and declining 

prices for primary commodities. Consequently, 

many of these traditional uses are party to the 

transformation of land use patterns, as ranches and 

agricultural lands are sold for residential and 

second home development.’’ University of New 

Mexico Bureau of Business and Economic Research, 

‘‘Socioeconomic Assessment of the Santa Fe 

National Forest,’’ August 2007 at pg. 99, found at 

https://www.fs.usda.gov/internet/FSE_

DOCUMENTS/fsbdev3_021243.pdf (last accessed 

July 5, 2023). 

DEPARTMENT OF HOMELAND 

SECURITY 

Federal Emergency Management 

Agency 

44 CFR Part 296 

[Docket ID FEMA–2022–0037] 

RIN 1660–AB14 

Hermit’s Peak/Calf Canyon Fire 

Assistance 

AGENCY: Federal Emergency 

Management Agency, Department of 

Homeland Security. 

ACTION: Final rule. 

SUMMARY: This final rule sets out the 

procedures for claimants to seek 

compensation for injury or loss of 

property resulting from the Hermit’s 

Peak/Calf Canyon Fire. 

DATES: This rule is effective August 29, 

2023. 

FOR FURTHER INFORMATION CONTACT: 

Angela Gladwell, Office of Response 

and Recovery, 202–646–2500, FEMAHermits-Peak@fema.dhs.gov. Persons 

with hearing or speech challenges may 

access this number through TTY by 

calling the toll-free Federal Relay 

Service at 800–877–8339. 

SUPPLEMENTARY INFORMATION: 

I. Executive Summary 

A. Summary of Legal Authority 

Congress enacted the Hermit’s Peak/ 

Calf Canyon Fire Assistance Act (‘‘Act’’) 

as part of the Continuing 

Appropriations and Ukraine 

Supplemental Appropriations Act, 

2023, Public Law 117–180, 136 Stat. 

2114 (2022), and directed FEMA to 

issue an Interim Final Rule (‘‘IFR’’) 

within 45 days of enactment. Congress 

passed the Act to compensate those 

parties who suffered injury and loss of 

property from the Hermit’s Peak/Calf 

Canyon Fire (‘‘Fire’’). The Act requires 

FEMA to design and administer a claims 

program to compensate victims of the 

Fire for injuries resulting from the Fire 

and to provide for the expeditious 

consideration and settlement for those 

claims and injuries. The Act further 

directs FEMA to establish an arbitration 

process for disputes regarding claims. 

On December 29, 2022, the 

Consolidated Appropriations Act, 2023, 

Public Law 117–328, 136 Stat. 4459 

provided additional funding for the 

Act’s implementation. 

B. Summary of the IFR 

On November 14, 2022, FEMA 

published the IFR that established the 

procedures for processing and paying 

claims for property, business, and/or 

financial losses to those sustaining 

losses from the Fire. FEMA’s procedures 

in the IFR were generally consistent 

with those established for claims 

associated with the Cerro Grande Fire 

Assistance Act.1 Under the IFR 

procedures, a claimant initiates a claim 

by filing a Notice of Loss with the Office 

of Hermit’s Peak/Calf Canyon Fire 

Claims (‘‘Claims Office’’). After receipt 

and acknowledgement by the Claims 

Office, the Claims Office contacts the 

claimant to review the claim and helps 

the claimant formulate a strategy for 

obtaining any necessary supporting 

documentation to complete the Proof of 

Loss. After coordinating with the Claims 

Reviewer, the claimant reviews and 

signs a Proof of Loss and submits it to 

the Claims Office. The Claims Reviewer 

reviews and evaluates the Proof of Loss 

and submits a report to the Authorized 

Official for review to determine whether 

compensation is due to the claimant. 

The Authorized Official’s written 

decision is provided to the claimant. If 

satisfied with the decision, the claimant 

receives payment after returning a 

completed Release and Certification 

Form. If the claimant is not satisfied 

with the decision, an Administrative 

Appeal could be filed with the Director 

of the Claims Office. If the claimant is 

not satisfied after appeal, the dispute 

could be resolved through binding 

arbitration or heard in the United States 

District Court for the District of New 

Mexico. 

C. Summary of Changes From the IFR to 

the Final Rule 

FEMA is making changes from the IFR 

to the Final Rule to reflect the concerns 

raised by commenters and better adhere 

to the intent of the Act by addressing 

the needs of the communities impacted 

by the Fire. Given the geographic, 

economic, and cultural distinctions 

between the impacted communities of 

the Cerro Grande and the Hermit’s Peak/ 

Calf Canyon Fires, FEMA is revising 

some sections of the regulatory text to 

ensure the claims process is more 

tailored to claimants impacted by the 

Fire. FEMA is revising the regulatory 

text in the Final Rule to eliminate the 

25 percent formulas associated with 

reforestation and revegetation in 

§ 296.21(c)(2) and with heightened risk 

reduction in § 296.21(e)(5) that were 

based on the Cerro Grande Fire 

Assistance process. FEMA recognizes 

the distinct geographic, economic, and 

cultural differences between these 

impacted communities and that these 

formulas, while an efficient way to 

process claims in the Cerro Grande Fire 

Assistance process, are not easily 

adapted to meet the needs of claimants 

injured by the Fire. FEMA agrees with 

the majority of commenters that removal 

of these formulas is essential to ensuring 

claimants in the Hermit’s Peak/Calf 

Canyon Fire Assistance process are 

compensated for their actual 

compensatory damages resulting from 

the Fire. FEMA is modifying 

§ 296.21(c)(3)(ii) regarding claims for a 

decrease in the value of real property. 

Distinct from Cerro Grande, the 

claimants impacted by this Fire have 

commented that they are more likely to 

have significant acreage damaged that 

has the potential for long-term natural 

restoration. Requiring that the property 

value be permanently diminished for a 

decrease in property value claim, as 

provided in the IFR, is inconsistent with 

the geography, economy, and real estate 

valuations of the impacted 

communities.2 Based on comments 

received and to ensure the Final Rule 

accommodates the needs of claimants 

and impacted communities, FEMA is 

revising the language in 296.21(c)(3)(ii) 

to allow a claimant to establish that the 

value of the real property was 

‘‘significantly’’ diminished ‘‘long-term’’ 

as a result of the Fire. FEMA is adding 

paragraph (c)(5) to incorporate language 

from the Act regarding physical 

infrastructure to ensure that claimants 

understand compensatory damages may 

be awarded for damage or destruction of 

physical infrastructure, including 

damage to irrigation infrastructure such 

as acequia systems. Acequia systems are 

unique to the communities impacted by 


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Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 59731 

3As mentioned above, Division N, Title VI of the 

Consolidated Appropriations Act, 2023, Public Law 

117–328, 136 Stat. 4459 authorized additional 

funding to implement the Act. 

4Section 102(a)(1) and (2), Hermit’s Peak/Calf 

Canyon Fire Assistance Act, Public Law 117–180, 

136 Stat. 2114 (2002). See also ‘‘Las Dispensas 

Prescribed Burn Declared Wildfire,’’ Apr. 6, 2022 

found at https://inciweb.nwcg.gov/incident/article/ 

8049/68044/ (last accessed July 5, 2023 Sept. 15, 

2022) and Theresa Davis, ‘‘How ‘good fires’ can turn 

into wildfires,’’ Albuquerque Journal, Apr. 30, 2022 

found at https://www.alqjournal.com/2494692/howgood-fires-can-turn-into-wildfires.html (last 

accessed Sept. 15, 2022). 

5See Bill Gabbert, ‘‘Investigators determine Calf 

Canyon Fire caused by holdover from prescribed 

fire,’’ Wildfire Today, May 27, 2022 found at 

https://wildfiretoday.com/?s=calf+canyon+

holdover&apbct__email_id__search_form_34270= 

(last accessed Oct. 6, 2022). 

the Fire and, just as the Act recognizes 

this distinction, FEMA is also 

recognizing it and incorporating it into 

the Final Rule. 

In the IFR, FEMA requested 

additional feedback on some of the 

dates set relating to claims for financial 

losses. Based on comments received, 

FEMA is making changes to those dates. 

FEMA currently requires claimants 

seeking compensation for out-of-pocket 

expenses for treatment of mental health 

conditions to submit claims for 

treatment rendered on or before April 6, 

2024. FEMA is revising this paragraph 

to allow claims for treatment identified 

on or before November 14, 2024, 

consistent with the timeframe for 

submitting a claim under the Act. FEMA 

recognizes that mental health treatment 

may extend beyond the deadline for 

filing a claim and claimants may reopen 

claims under § 296.35 for good cause. 

FEMA is also making a clarifying edit in 

the Final Rule by specifying that the 

treatment can be for a condition that 

resulted from the Fire or for conditions 

worsened by the Fire. Based on 

comments received, this edit helps 

clarify that treatment for conditions 

worsened by the Fire will also be 

compensated. In the IFR, FEMA allows 

compensation for donations provided 

no later than September 20, 2022. FEMA 

is revising § 296.21(c)(4) to allow 

claimants to seek actual compensatory 

damages for donations provided to 

survivors no later than November 14, 

2022. FEMA is setting the date of the 

IFR publication as the timeframe by 

which donations will be considered 

compensable. 

FEMA is modifying the language in 

§ 296.31(a) regarding reimbursement for 

expert opinions. FEMA understands 

that claimants impacted by this Fire are 

more likely to need the services of 

experts to help better value their claims 

than the claimants in the Cerro Grande 

Fire Assistance process given the scope 

of the Fire and the geographic, 

economic, and cultural distinctions 

between the impacted communities. 

FEMA is revising the regulatory text to 

allow for reimbursement for expert 

opinions that the Claims Office deems 

necessary to determine the amount of 

the claim. This additional flexibility 

will help claimants and FEMA better 

understand and process claims. 

FEMA is also revising § 296.35 of the 

regulatory text in the Final Rule 

regarding reopening a claim. The IFR 

provides that claimants can seek to 

reopen their claim to consider issues 

raised when the claimant closes on the 

sale of a home and wishes to present a 

claim for a decrease in the value of their 

real property under § 296.21(c)(3). 

FEMA is revising this language in the 

Final Rule to allow claimants to reopen 

their claim when the claimant closes on 

the sale of real property, expanding the 

ability to reopen a claim beyond just a 

home. This change reflects the unique 

geographic area impacted by the Fire 

and the reality that claimants may sell 

a portion of their land without 

necessarily selling their home and 

experience a loss for which 

compensation should be made available. 

FEMA is also revising the timeline by 

which a request to reopen must be 

submitted for claims related to 

additional losses as part of a 

reconstruction in excess of those 

previously awarded or for good cause. 

Recognizing the challenges claimants 

face with reconstruction and other 

potential issues that can arise that 

require a claim to be reopened, FEMA 

is revising § 296.35 to set the deadline 

by which requests to reopen these types 

of claims must be submitted as a date in 

the future that the Director of the Claims 

Office will set and publish in the 

Federal Register and at https://

www.fema.gov/hermits-peak. 

FEMA is making some clarifying 

revisions in the Final Rule. Currently in 

§ 296.1, FEMA states the purpose of the 

rule is to pay for actual compensatory 

damages for injuries suffered from the 

Fire (emphasis added). FEMA is 

revising this language, consistent with 

the language from the Act, to pay for 

actual compensatory damages for 

injuries resulting from the Fire 

(emphasis added). FEMA is making this 

edit to better communicate to claimants 

that all injuries resulting from the Fire, 

including injuries resulting from 

flooding, mudflow, mold, and debris 

flow in the aftermath of the Fire, are 

compensable. However, a claimant may 

not be eligible for compensation if their 

injuries resulted from flooding, 

mudflow, mold, or debris unrelated to 

the Fire. FEMA is also updating the 

definition of ‘‘subsistence resources’’ to 

include ‘‘other natural resource’’ 

gathering, consistent with how the 

impacted communities are engaged in 

subsistence activities. FEMA is updating 

§ 296.12 regarding election of remedies. 

The IFR discusses how claimants waive 

their right to pursue claims if they 

accept an award. FEMA is revising this 

section to clarify that the claimant 

waives their right to pursue other claims 

only after acceptance of a final award, 

consistent with commenters’ request for 

additional clarity on this point and for 

consistency with the Act. Consistent 

with the Act, FEMA is incorporating 

language in § 296.13 to reiterate the 

prioritization of claims for injured 

persons over subrogees. In § 296.21(a), 

FEMA is resolving a grammatical error 

by changing ‘‘Injury’’ to ‘‘injury’’ and 

another grammatical error by adding 

‘‘that’’ to § 296.21(f) to read that the Act 

allows FEMA to compensate Injured 

Persons only for damages not paid, or 

that will not be paid, by insurance or 

other third-party payments or 

settlements. 

II. Background and Legal Authority 

On September 30, 2022, President 

Biden signed the Act into law as part of 

the Continuing Appropriations and 

Ukraine Supplemental Appropriations 

Act, 2023, Public Law 117–180, 136 

Stat. 2114 (2022).3 Congress passed the 

Act to compensate those parties who 

suffered injury and loss of property from 

the Hermit’s Peak/Calf Canyon Fire. On 

April 6, 2022, the U.S. Forest Service 

initiated the Las Dispensas-Gallinas 

prescribed burn on Federal land in the 

Santa Fe National Forest in San Miguel 

County, New Mexico. That same day the 

prescribed burn, which became known 

as the ‘‘Hermit’s Peak Fire,’’ escaped the 

burn unit’s boundaries and was 

declared a wildfire, spreading to other 

Federal and non-Federal lands.4 On 

April 19, 2022, the Calf Canyon Fire, 

also in San Miguel County, New 

Mexico, began burning on Federal land 

and was later identified as the result of 

a pile burn in January 2022 that 

remained dormant under the surface 

before reemerging.5 The Hermit’s Peak 

and Calf Canyon Fires merged on April 

27, 2022, and both fires were reported 

as the Hermit’s Peak Fire or the Hermit’s 

Peak/Calf Canyon Fire. By May 2, 2022, 

the fire had grown, causing evacuations 

in multiple villages and communities in 

San Miguel County and Mora County, 

including the San Miguel County jail, 

the State’s psychiatric hospital, the 

United World College, and New Mexico 


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59732 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

6See Bill Gabbert, ‘‘Calf Canyon/Hermits Peak 

Fire grows to more than 120,000 acres,’’ Wildfire 

Today, May 2, 2022 found at https://

wildfiretoday.com/2002/05/02/calf-canyon-hermitspeak-fire-grows-to-more-than-120000-acres/ (last 

accessed Sept. 15, 2022). See also Bryan Pietsch and 

Jason Samenow, ‘‘New Mexico blaze is now largest 

wildfire in state history,’’ The Washington Post, 

May 17, 2022, found at https://

www.washingtonpost.com/nation/2022/05/17/calfcanyon-hermits-peak-fire-new-mexico/ (last 

accessed July 27, 2023). 

7 87 FR 33808 (June 3, 2022). 

8 ‘‘Hermits Peak/Calf Canyon Fire 100 percent 

contained, fire officials say,’’ The New Mexican, 

Aug. 21, 2022 found at https://

www.santafenewmexican.com/news/local_news/ 

hermits-peak-calf-canyon-fire-100-percentcontained-fire-officials-say/articles_5ac054fc-21a1- 

11ed-9401-134e852ee0a8.html (last accessed July 5, 

2023). 

9FEMA received three comments that did not 

address the Interim Final Rule or the claims 

process: One commenter asked where the regulation 

could be read, and FEMA contacted the commenter 

to provide this information; another commenter 

shared a poem to reflect their feelings during the 

holiday season after the Fire; one comment from a 

law firm was incomplete without attachments 

referenced. 

10FEMA also received an inquiry on the status of 

another FEMA application at a public meeting. A 

commenter offered their services to assist with 

claims, filling out applications for Federal agencies, 

internet use, mental health assistance, etc. at two 

public meetings. Another commenter from the same 

organization also offered services during a public 

meeting. 

11Transcripts of that meeting have been posted to 

the public docket at https://www.regulations.gov/ 

docket/FEMA-2022-0037. 

12Bill Gabbert, ‘‘Cerro Grande fire, 10 years ago 

today,’’ May 10, 2010 found at https://

wildfiretoday.com/2010/05/10/cerro-grande-fire-10- 

years-ago-today/ (last accessed July 5,, 2023). 

13See New Mexico Forest and Watershed 

Restoration Institute, ‘‘Hermit’s Peak and Calf 

Canyon Fire: The largest wildfire in New Mexico’s 

recorded history and its lasting impacts’’ Aug. 24, 

2022, found at https://storymaps.arcgis.com/stories/ 

d48e2171175f4aa4b5613c2d11875653 (last 

accessed Mar. 3, 2023). 

14See https://www.census.gov/library/stories/ 

state-by-state/new-mexico-population-changebetween-census-decade.html (last accessed July 5, 

2023). 

15University of New Mexico Bureau of Business 

and Economic Research, ‘‘Socioeconomic 

Assessment of the Santa Fe National Forest,’’ 

August 2007 at pg. 5, found at https://

www.fs.usda.gov/internet/FSE_DOCUMENTS/ 

fsbdev3_021243.pdf (last accessed Mar. 3, 2023). 

Highlands University.6 At the request of 

New Mexico Governor Lujan Grisham, 

President Biden issued a major disaster 

declaration on May 4, 2022.7 The 

Hermit’s Peak/Calf Canyon Fire was not 

100 percent contained until August 21, 

2022.8

The Act provides compensation to 

injured persons impacted by the Fire. It 

requires FEMA to design and administer 

a claims program to compensate injured 

parties for injuries resulting from the 

Fire and to provide for the expeditious 

consideration and settlement for those 

claims and injuries. The Act further 

directs FEMA to establish an arbitration 

process for disputes regarding claims. 

On November 14, 2022, FEMA 

published an IFR with a 60-day 

comment period that established the 

procedures for the processing and 

payment of claims to those injured by 

the Fire sustaining property, business, 

and/or financial losses. FEMA held 

public meetings during the comment 

period to further gather public feedback 

on the rule. Based on public comment, 

FEMA is making changes to the Final 

Rule to better reflect the differences 

between the Cerro Grande Fire and the 

Hermit’s Peak/Calf Canyon Fire, as the 

Hermit’s Peak/Calf Canyon Fire 

destroyed a significant amount of 

forested private lands, communities, 

acequias, ranches, and farms, and to 

further reflect the specific cultural, 

economic, and geographic distinctions 

between the areas impacted by the 

Hermit’s Peak/Calf Canyon Fire. This 

rule finalizes the IFR, with changes in 

response to public comments received 

on the IFR. 

III. Discussion of Public Comments and 

FEMA’s Responses 

A. Summary of Public Comments 

The public comment period on the 

IFR closed on January 13, 2023, and 

FEMA received 190 germane written 

comments.9 FEMA hosted six public 

meetings on the IFR and received 103 

germane comments from those public 

meetings.10 FEMA also hosted a meeting 

with the State of New Mexico’s 

Department of Homeland Security and 

Emergency Management and supporting 

contract staff, and received comments 

during that meeting.11 Commenters 

included individuals, State and local 

government entities, congressional 

representatives, associations, law firms, 

and non-profit organizations. Some 

commenters appreciated FEMA’s effort 

to publish the IFR in a timely manner, 

arrange public meetings to listen to 

concerns in-person, and launch the 

claims process. Most commenters 

offered recommendations for changes to 

the IFR. FEMA describes the specific 

revisions to the Final Rule and 

addresses the specific concerns of 

commenters below. 

B. Differences Between the Hermit’s 

Peak/Calf Canyon Fire and the Cerro 

Grande Fire 

Some commenters recommended 

changes to the IFR based on the 

distinctions between the Cerro Grande 

and Hermit’s Peak/Calf Canyon Fires. 

Comment: Several commenters stated 

distinctions between the two areas 

where the fires were located. As one 

commenter stated, the Hermit’s Peak/ 

Calf Canyon Fire ‘‘destroyed significant 

forested private lands, communities, 

acequias, ranches, and farms.’’ Another 

commenter stated that the Cerro Grande 

Fire ‘‘burned a mostly urban 

environment of high-value homes on 

mostly small tracts of land’’ while the 

Hermit’s Peak/Calf Canyon Fire burned 

‘‘mostly rural land with relatively fewer 

and lower value structures.’’ 

FEMA Response: FEMA agrees that 

the challenges facing the communities 

and claimants impacted by the Hermit’s 

Peak/Calf Canyon Fire are distinct and 

that the IFR should be revised to better 

reflect those distinctions. The Cerro 

Grande Fire burned approximately 

47,000 forested acres, causing $1 billion 

in property damage with over 280 

homes destroyed or damaged and 40 

laboratory structures burned.12 In 

contrast, the Hermit’s Peak/Calf Canyon 

Fire burned more than 340,000 acres, 

just under 200,000 of which were 

privately owned, and destroyed at least 

160 homes and over 900 structures.13

According to the 2020 Census, Los 

Alamos County’s population density is 

178 people per square mile compared to 

5.8 people per square mile in San 

Miguel County and 2.2 people per 

square mile in Mora County.14 In the 

Socioeconomic Assessment of the Santa 

Fe National Forest, provided to the U.S. 

Forest Service by the University of New 

Mexico, Bureau of Business and 

Economic Research, approximately one 

third of privately held land within the 

Santa Fe National Forest is located in 

San Miguel County.15 Given the 

Hermit’s Peak/Calf Canyon Fire’s scope 

and the type of land impacted by that 

fire, FEMA is proposing changes to 

sections 296.4, 296.21(c)(2), 

296.21(c)(3)(ii), 296.21(e)(5), 296.31(a), 

and 296.31(c)(3) while adding 

§ 296.21(c)(5) to address the concerns 

raised that are unique to those 

communities. Changes to each of these 

sections is further described below. 

Comment: Commenters reiterated the 

communities impacted by the Hermit’s 

Peak/Calf Canyon Fire also had different 

economic and cultural practices. One 

commenter stated that ‘‘FEMA is totally 

unfamiliar with how land management, 

including use of resources is conducted 

in an area where descendants of an 

individual land grant have access to and 

use of resources within that grant.’’ The 

commenter went on to note that the 

Cerro Grande Fire impacted a part of the 

State that ‘‘has little in common with 

the cultural and economic practices in 

this area.’’ As one commenter stated, 

‘‘Individuals and businesses relied on 


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Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 59733 

16University of New Mexico Bureau of Business 

and Economic Research, ‘‘Socioeconomic 

Assessment of the Santa Fe National Forest,’’ 

August 2007 at pgs. 78–79 and 89, found at https:// 

www.fs.usda.gov/internet/FSE_DOCUMENTS/ 

fsbdev3_021243.pdf (last accessed Mar. 3, 2023). 

17The population per square mile in 2020 was 

178 in Los Alamos County, 5.8 in San Miguel 

County, and 2.2 in Mora County. See U.S. Census 

Quick Facts—Los Alamos County, New Mexico 

found at https://www.census.gov/quickfacts/ 

losalamoscountynewmexico, https://

www.census.gov/quickfacts/ 

sanmiguelcountynewmexico, and https://

www.census.gov/quickfacts/moracountynewmexico 

(last accessed July 5, 2023). 

the forests not just for subsistence, but 

also for their annual income for 

themselves and others in the 

community.’’ Another commenter 

stated, ‘‘The use of the land’s timber in 

small (family) enterprises is one of the 

keys to the livelihoods of this area. 

Another is the small farming enterprises 

consisting of small orchards, raising 

hay, cattle, and horses. This is not a 

region of city life and landscaping, but 

is rural, with a deep heritage of 

independent living and family 

business.’’ 

FEMA Response: FEMA agrees that 

the losses facing the communities and 

claimants impacted by the Hermit’s 

Peak/Calf Canyon Fire are distinct and 

that the IFR should be revised to better 

reflect those distinctions. The Act 

requires FEMA to compensate claimants 

for injuries resulting from the Fire and 

the injuries suffered by claimants in this 

community are distinct from those 

suffered in Cerro Grande. Specifically, 

FEMA notes the economic differences 

between the two impacted communities 

resulted in different losses within each 

community. Los Alamos County has an 

economy ‘‘almost entirely composed of 

government, retail, and service sector 

jobs. These three sectors combined 

make up more than 90 percent of the 

county’s employment . . . Los Alamos 

is somewhat unique in its lack of 

farming and other ‘core’ industry sectors 

such as construction and manufacturing 

. . . Mora County is by far the smallest 

county in the region, in terms of size as 

well as economy . . . San Miguel 

County is fairly small, and farm 

employment makes up a larger portion 

of overall employment there than in any 

other county in the region except Rio 

Arriba. San Miguel and Mora County 

contain minor, though substantial, 

sections of the Santa Fe N[ational] 

F[orest]. These two counties, as the 

smaller and poorer economies of the 

region, likely rely more heavily on the 

benefits of the forest as a provider of 

primary products such as fuel wood and 

food, as well as land for ranching and 

logging.’’ 16 The communities impacted 

by the Hermit’s Peak/Calf Canyon Fire 

rely much more on the land for their 

economic viability than the Los Alamos 

County community that was impacted 

by the Cerro Grande Fire. Additionally, 

the population per square mile in the 

impacted communities demonstrates a 

much higher density in Los Alamos 

County compared to Mora and San 

Miguel Counties and requiring FEMA to 

consider the differences in the 

residential areas impacted by the two 

fires.17 To fully implement the intent of 

the Act, FEMA must consider these 

differences between the impacted 

communities and address the specific 

injuries suffered by the Hermit’s Peak/ 

Calf Canyon Fire communities around 

the use of the land in those 

communities. FEMA is proposing 

changes to §§ 296.4, 296.21(c)(2), 

296.21(c)(3)(ii), 296.21(e)(5), 296.31(a), 

and 296.35 while adding § 296.21(c)(5) 

to address the concerns raised that are 

unique to these communities. Changes 

to each of these sections are further 

described below. 

Comment: Commenters stated another 

distinction between those impacted by 

the Hermit’s Peak/Calf Canyon Fire and 

those impacted by the Cerro Grande Fire 

included the number of claimants that 

are insured, stating more claimants in 

the Cerro Grande Fire were insured than 

in the Hermit’s Peak/Calf Canyon Fire. 

FEMA Response: FEMA agrees that 

the challenges facing the claimants 

impacted by the Hermit’s Peak/Calf 

Canyon Fire are distinct and that the 

IFR should be revised to better reflect 

those distinctions. Specifically, FEMA 

is proposing changes to sections 

296.21(c)(2), 296.21(e)(5), 296.31(a), and 

296.35 while adding § 296.21(c)(5) to 

address the concerns raised regarding 

the number of uninsured claimants 

impacted by the fire. 

Comment: A commenter suggested 

FEMA look at other wildfires beyond 

Cerro Grande, including the recent 

California wildfire involving a utility 

company. 

FEMA Response: FEMA appreciates 

the suggestion and has reviewed some 

of the best practices associated with the 

California compensation process 

referenced by the commenter. That 

process, however, involved a 

bankruptcy settlement of a private 

corporation under California law. FEMA 

is required to follow the statutory 

framework provided in the Act. While 

the Claims Office is reviewing some of 

the best practices from the California 

incident, that incident and the 

compensation process implemented to 

compensate those injured thereby are 

factually and legally too distinct from 

the Act’s requirements to be considered 

a full template for implementation in 

regulation. 

C. Comments on §§ 296.1 and 296.3, the 

Rule’s Purpose and Information 

Comment: FEMA received comments 

stating the IFR’s purpose should be 

revised to reflect the Act’s purpose 

language. Specifically, a commenter 

wrote ‘‘The Hermit’s Peak/Calf Canyon 

Fire Assistance Act provides one of the 

purposes of the Act is ‘to compensate 

victims of the Hermit’s Peak/Calf 

Canyon Fire, for injuries resulting from 

the fire.’ . . . FEMA’s [I]nterim [F]inal 

[R]ule’s current phrase ‘suffered from 

the Hermit’s Peak/Calf Canyon Fire’ 

(emphasis added) could result in 

limiting allowable losses to solely fire 

damages, in violation of the Act.’’ 

FEMA’s Response: FEMA agrees that 

the Act’s purpose as stated in section 

102(b)(1) is to compensate victims for 

‘‘injuries resulting from the Fire’’ 

(emphasis added) and is amending 

§ 296.1 to state that the Claims Office 

will receive, evaluate, process, and pay 

actual compensatory damages for 

injuries resulting from the Hermit’s 

Peak/Calf Canyon Fire. This technical 

edit provides consistency with the 

language of the Act. 

Comment: Some commenters 

requested FEMA change the purpose of 

the rule in § 296.1 to include flood 

damages, as well as throughout the rest 

of the rule. 

FEMA Response: The Final Rule 

language as revised in § 296.1 as 

explained above is sufficiently broad to 

encompass a range of damages 

claimants may have suffered, including 

flood and flood-related damages. 

Further, the definition of ‘‘injured 

person’’ includes injuries ‘‘resulting 

from the Hermit’s Peak/Calf Canyon 

Fire’’ and is sufficiently broad to 

encompass flooding, mudflow, mold, 

and debris flow, as well as other types 

of injuries that may result from the Fire. 

Comment: One commenter suggested 

that FEMA include specific reference to 

mitigation efforts in the rule’s purpose. 

FEMA Response: Section 296.1 does 

not require any edits to incorporate 

mitigation efforts into the rule. The 

purposes of the Act are to compensate 

Fire victims for injuries resulting from 

the Fire and the expeditious 

consideration and settlement of claims 

for those injuries. Further, the Act 

requires FEMA to promulgate a 

regulation ‘‘for the processing and 

payment of claims under the Act.’’ 

Consistent with the Act, FEMA’s Final 

Rule states the purpose of the regulation 

is to ‘‘establish the Office of Hermit’s 

Peak/Calf Canyon Fire Claims (‘Claims 

Office’) to receive, evaluate, process, 


ddrumheller on DSK120RN23PROD with RULES4
59734 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

18See ‘‘Writing Resources for Federal Agencies, 

Regulatory Drafting Guide, Definitions’’ found at 

https://www.archives.gov/federal-register/write/ 

legal-docs/definitions.html (last accessed Feb. 16, 

2023). 

19Section 103, Definition of ‘‘Administrator’’ 

(1)(B). 

and pay actual compensatory damages 

for injuries resulting from the Hermit’s 

Peak/Calf Canyon Fire.’’ The Act 

authorizes FEMA to compensate 

claimants for the ‘‘costs of reasonable 

efforts, as determined by the 

Administrator, to reduce the risk of 

wildfire, flood, or other natural disaster 

in the counties impacted by the 

Hermit’s Peak/Calf Canyon Fire to risk 

levels prevailing in those counties 

before the Hermit’s Peak/Calf Canyon 

Fire,’’ and FEMA details this 

compensation in § 296.21(e)(5). Section 

296.1 does not require revision to allow 

for compensation for eligible risk 

reduction measures. 

Comment: Some commenters 

suggested FEMA amend the information 

and assistance section to incorporate 

details regarding the Claims Office 

addresses and phone number. One 

commenter suggested FEMA allow for 

applications, correspondence, and 

supporting documentation to be 

exchanged by postal mail. This 

commenter also recommended FEMA 

create centralized locations where 

northern New Mexicans can physically 

go to access the electronic application 

and receive assistance in filling out the 

applications in multiple languages so 

that the application and supporting 

documentation can be timely submitted. 

FEMA Response: FEMA appreciates 

these suggestions and plans to provide 

further details regarding the Claims 

Office operation and opportunities for 

claimants to obtain assistance online at 

https://www.fema/gov/hermits-peak as 

explained in the regulation. Because 

FEMA wants to continue adapting to 

claimants’ needs in this process, it is 

best to direct claimants to the website in 

the regulations for the latest information 

available on the process. FEMA will 

continue to provide outreach efforts to 

the community in addition to posting at 

https://www.fema.gov/hermits-peak. 

D. Comments on § 296.4 Definitions 

Some commenters suggested FEMA 

modify the definitions provided in the 

IFR to better reflect the unique 

challenges presented by the Hermit’s 

Peak/Calf Canyon Fire. 

Comment: One commenter 

recommended FEMA amend the 

definition of ‘‘Authorized Official’s 

Determination’’ to include 

determinations by mail and 

electronically. 

FEMA Response: FEMA does not 

believe edits to the regulatory text are 

required as ‘‘mailed’’ can incorporate 

both physical and electronic mailing. 

FEMA anticipates that, where 

applicants have provided contact 

information to allow for electronic 

mailing of this determination, the 

Agency will provide the Authorized 

Official’s determination both by mail 

and electronically. However, there may 

be instances where the claimant has not 

provided contact information to allow 

for electronic mailing and thus FEMA 

could only provide the determination by 

physical mail. To ensure flexibility in 

these instances, FEMA is not amending 

the regulatory language. 

Comment: One commenter also 

recommended adding a definition of a 

‘‘Claims Navigator’’ to the regulation, 

providing suggestions on how these 

Navigators would work with claimants 

in the process. 

FEMA Response: FEMA does not 

believe this change is needed. The 

Agency is not referencing this term in 

the regulatory text. Terms not used in 

the regulatory text do not need to be 

defined in the definitions section of the 

regulation.18

Comment: A commenter suggested 

revision to the definition of ‘‘good 

cause’’ to include ‘‘or any circumstance 

where the Administrator determines 

that good cause would further the 

mission of the Claims Office to pay 

compensatory damages for injuries 

suffered from the Hermit’s Peak/Calf 

Canyon Fire.’’ 

FEMA Response: FEMA disagrees 

with the comments that the additional 

language in the definition of ‘‘good 

cause’’ is required. The Act authorizes 

the Director of the Claims Office to 

assume the duties of the 

Administrator.19 Adding language to the 

definition of ‘‘good cause’’ to allow the 

Administrator to make a good cause 

determination would result in a 

redundancy as the IFR language 

provides the Director discretion to make 

good cause determinations. As written, 

the IFR provides for the use of good 

cause in circumstances regarding 

deadlines or supplementing and 

reopening claims. 

Comment: Some commenters also 

requested the definition of ‘‘good cause’’ 

be amended to include ‘‘or where 

damage from post-fire flooding is 

suffered by the claimant after filing a 

claim.’’ 

FEMA Response: FEMA disagrees that 

the ‘‘good cause’’ definition must be 

revised to consider flooding damage 

after filing a claim. As explained above, 

the definition of ‘‘injured person’’ 

includes injuries ‘‘resulting from the 

Hermit’s Peak/Calf Canyon Fire’’ and is 

broad enough to encompass flooding, 

mudflow, mold, and debris flow, as well 

as other types of injuries that may be 

considered as a result of the Fire. The 

current language allows for good cause 

‘‘where damage is found after a claim 

has been submitted’’ and this language, 

read in conjunction with the definition 

of ‘‘injured person’’ addresses concerns 

regarding whether such damage could 

constitute good cause to supplement or 

reopen a claim. 

Comment: One commenter raised 

concerns that ‘‘good cause’’ was too 

subjective. 

FEMA Response: The application of a 

good cause definition requires use of 

discretion that by nature contains some 

subjectivity that cannot be fully 

eliminated from the determination. 

Comment: A commenter 

recommended FEMA change the 

definition of the ‘‘Hermit’s Peak/Calf 

Canyon Fire’’ to add ‘‘flooding, 

mudflow, mold, and debris flow 

resulting from the two fires.’’ The 

commenter requested FEMA specifically 

reference flooding, mudflow, mold, and 

debris flow as a cause of injury and as 

a damage that can be compensated. 

FEMA Response: FEMA disagrees that 

this change is needed to the definition 

of ‘‘Hermit’s Peak/Calf Canyon Fire’’ to 

compensate claimants for these types of 

injuries resulting from the Fire. The 

definition of ‘‘injured person’’ includes 

injuries ‘‘resulting from the Hermit’s 

Peak/Calf Canyon Fire’’ and is broad 

enough to encompass flooding, 

mudflow, mold, and debris flow, as well 

as other types of injuries that may be 

considered as a result of the Fire. 

Adding this language may narrow the 

scope of damages an injured person may 

seek to claim, and FEMA prefers to 

retain the current definition of the Fire 

while allowing claimants suffering 

injuries resulting from the Fire be 

allowed to present their claims. 

Comment: Three commenters 

recommended that FEMA modify the 

definition of household ‘‘to clarify that 

it does not exclude the claims of owners 

that did not live at the property on a 

continuous basis’’ and that rather, these 

individuals should be included. While 

including them in the definition of 

household, the commenters 

recommended that these individuals 

‘‘not be compensated for financial 

damages already paid to the primary 

resident.’’ Rather, the individuals 

should be ‘‘eligible for compensation 

based on their individual loss.’’ 

FEMA Response: FEMA is not 

amending the definition of ‘‘household’’ 

as requested by these comments. 

Claimants can file a claim as a 


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Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 59735 

20https://www.fema.gov/assistance/individual/ 

program (last accessed Mar. 3, 2023). 

household or individually in these 

circumstances and the Claims Office 

will accept the claim for review. 

Nothing in the current definition 

prohibits claims filing either as a 

household or individually. 

Comment: A commenter suggested the 

definition of ‘‘injured person’’ be 

modified to include ‘‘acequia, land 

grant’’ immediately after ‘‘school 

district’’ in the definition. 

FEMA Response: FEMA does not 

believe this amendment is required to 

cover the entities referenced. Rather, 

these entities are covered under the 

current definition as an ‘‘other nonFederal entity that suffered injury 

resulting from the Hermit’s Peak/Calf 

Canyon Fire.’’ 

Comment: Another commenter stated 

FEMA should amend the definition of 

‘‘injured person’’ to include flooding, 

mudflow, mold, and debris flow as a 

cause of injury and damage that can be 

compensated. 

FEMA Response: FEMA disagrees that 

this edit is required to the regulatory 

text. The current definition provides for 

these types of injuries, as well as other 

types of injuries that may be considered 

an injury resulting from the Fire. 

Adding this language may narrow the 

scope of damages an injured person may 

seek to claim. The proposed language 

also conflates injuries from flooding, 

mudflow, mold, and debris irrespective 

of their connection with the Fire with 

injuries from flooding, mudflow, mold, 

and debris that are connected to the 

Fire. Only the latter are compensable 

under the Act. Therefore, FEMA prefers 

to retain the current definition of the 

Fire, which will allow claimants 

suffering injuries resulting from the Fire 

to present their claims. 

Comment: Commenters wrote that 

nonprofit organizations should be 

considered ‘‘injured person.’’ 

FEMA Response: The current 

definition of ‘‘injured person’’ includes 

an ‘‘other non-Federal entity that 

suffered injury resulting from the 

Hermit’s Peak/Calf Canyon Fire’’ and 

that terminology encompasses nonprofit organizations. FEMA understands 

non-profit organizations may have 

suffered injuries resulting from the Fire, 

and FEMA believes the current 

definition sufficiently encompasses all 

types of for-profit and non-profit 

entities. FEMA’s website at https://

www.fema.gov/hermits-peak provides 

more information explaining the 

regulatory text to help claimants better 

understand who is considered an 

injured person under the Act. 

Comment: Some commenters 

suggested that FEMA amend the 

definition of ‘‘subsistence resources’’ to 

include ‘‘and other natural resource’’ to 

reflect the types of resources gathered 

and the broad range of subsistence use 

practices of both acequia-served 

communities, as well as Tribal and 

Pueblo sovereigns. 

FEMA Response: Consistent with 

these suggestions, FEMA is adding ‘‘or 

other natural resource’’ to the definition 

of ‘‘subsistence resources’’ to reflect the 

specific needs of the impacted 

communities. As explained above, the 

Hermit’s Peak/Calf Canyon Fire 

impacted an area that is economically 

and culturally distinct from the 

communities impacted by the Cerro 

Grande Fire. This change reflects 

FEMA’s understanding that other 

natural resources beyond firewood may 

be gathered for subsistence purposes. 

E. Comments on the Claims Process 

Generally 

Commenters offered comments and 

suggestions on a wide range of issues on 

the claims process. Commenters offered 

suggestions on ways to streamline the 

process and to make the process more 

accessible to the impacted communities. 

Commenters wrote of experiences with 

FEMA and other Federal agencies, 

stating how FEMA and other agencies 

handled their cases under other 

programs. 

Comment: One commenter stated, 

‘‘Nothing in my experience with 

F[EMA] so far gives me faith that you 

are on my side or have my best interests 

at heart.’’ The comment continued ‘‘So 

far communication between government 

entities and organizations has been 

nonexistent or completely dysfunctional 

. . . I need to have more confidence in 

your ability to work with other entities, 

or even communicate within F[EMA].’’ 

Commenters provided suggestions on 

hiring personnel for the Claims Office, 

including the Claims Office Director, 

Claims Navigators, Claims Reviewers, 

and other staff, and how the agency 

should train the staff. Commenters also 

stated their anger, frustration, and 

mistrust of the process and requested to 

be treated with respect and compassion. 

One commenter wrote ‘‘Cataloging every 

single thing we lost in the fire, 

correlating it with a receipt, and looking 

up how much it will currently cost to 

replace it has been a full-time job for a 

while now, and extremely difficult 

emotionally.’’ Another commenter 

wrote about a recent experience with 

FEMA stating ‘‘it did nothing to build 

trust or confidence in FEMA. The end 

effect has been the exact opposite. And 

in turn, I have since prepared myself to 

expect more of this inappropriate 

treatment from FEMA in all future 

interactions.’’ A different commenter 

wrote ‘‘HPFAA administrators and 

claims reviewers must handle all 

injured victim cases as though this 

injury to their lives and livelihoods is a 

direct result of a felony act of arson 

deliberately committed against them all. 

Government employees and contractors 

responsible for this conflagration will 

never truly be held accountable to 

receive due punishment for actions 

which will never even ‘officially’ be 

considered gross incompetence, but that 

doesn’t make the end result any less 

destructive than an act of intentional 

criminal arson would be.’’ One 

commenter stated ‘‘I want you to 

remember that this is a fire caused by 

the [F]ederal government and that we 

are the victims of this. Please treat us 

with respect.’’ 

FEMA Response: FEMA acknowledges 

the unique challenges faced by the 

communities impacted by the Fire and 

how challenging it has been for 

claimants to recover. FEMA and the 

Federal government provided a range of 

existing programs to those impacted by 

the Fire, many of which were not 

designed to meet the needs of the 

impacted communities, given the extent 

of the injuries suffered as a result of the 

Fire. Those programs were not designed 

to provide full financial compensation 

to those injured by the Fire. For 

example, the Individuals and 

Households Program (IHP) provides 

financial and direct services to eligible 

individuals and households affected by 

a disaster, who have uninsured or 

under-insured necessary expenses and 

serious needs. IHP is not a substitute for 

insurance and cannot fully compensate 

for all losses caused by a disaster; 

rather, that assistance is intended to 

meet basic needs and supplement 

disaster recovery efforts.20 As disaster 

assistance programs are not designed to 

fully compensate those impacted by 

disasters, some applicants in these 

communities are frustrated with and 

uncertain about, the Federal 

government’s ability to assist them. The 

Act’s commitment to compensate 

victims through the Claims Office 

process allows FEMA to directly 

provide claimants with compensation to 

better assist claimants and communities 

in more fully recovering from this 

devastating Fire. The Agency is 

committed to working with claimants 

and communities to ensure the Claims 

Office meets their needs and 

compensates claimants for the damages 

resulting from the Fire. The Claims 

Office hired Claims Navigators from the 

community to guide claimants through 


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59736 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

21FEMA hosted a Hiring Fair on January 10, 

2023, in Mora, NM and provided Federal Resume 

Writing webinars on December 29, 2022, and 

January 3, 2023. Details regarding the available 

positions were also posted to https://

www.fema.gov/fact-sheet/hermits-peakcalf-canyonclaims-office-now-hiring (last accessed Feb. 16, 

2023). 

22FEMA notes that given the permanent positions 

in the Claims Office are located in Mora, Las Vegas, 

and Santa Fe, New Mexico, most applicants seeking 

these positions were local. 

the application process, focusing on 

ensuring that claimants understand the 

process of applying for compensation, 

what compensation is available for their 

losses, and what documentation is 

needed to obtain this compensation. 

The Claims Office operates 

independently of FEMA’s other 

programs, and it provides a great deal 

more flexibility in the process of 

applying for and receiving 

compensation than these more 

traditional grant programs. Unlike 

FEMA’s Individual Assistance and 

Public Assistance, which provide 

disaster assistance to individuals and 

households impacted by declared 

disasters, the Claims Office is not 

subject to any caps on the amount of 

assistance it can provide. Unlike 

FEMA’s Public Assistance Program, 

which provides grants to States, 

Federally recognized Tribal 

governments, U.S. territories, local 

governments, and certain private nonprofit (PNP) organizations, the Claims 

Office does not have any cost share 

requirements, and there are no 

conditions placed on receipt of the 

compensation. 

1. Comments on the Claims Office 

Administrator 

Comment: Commenters made specific 

requests regarding the appointment of 

the Claims Office Administrator. 

Commenters requested that an 

Independent Claims Administrator be 

appointed. One commenter stated that 

the broad ‘‘make whole’’ compensation 

approach of the Act was different from 

FEMA’s normal disaster relief operation 

and Congress recognized this by 

providing for the appointment of an 

Independent Claims Administrator in 

the Act. This commenter stated the 

number of potential claimants and 

broad scope of the harm they have 

suffered required the appointment of an 

Independent Claims Administrator with 

experience in ‘make whole’ 

compensation processes. A different 

commenter wrote that these claims 

processes are extremely complex, with 

many moving parts and unique issues, 

and would be best overseen by a claims 

manager familiar with fire-related 

claims processes. Another commenter 

suggested an independent trustee or 

claim administrator be appointed to 

manage and stated FEMA should not be 

in charge of administration. 

FEMA Response: Section 104(a)(3) 

gives the Administrator the option to 

appoint an Independent Claims 

Manager to head the Claims Office. In 

her discretion, the Administrator 

selected a Claims Office Director with 

over 15 years of experience building and 

managing Federal programs to start up 

the Claims Office and did not opt to 

appoint an Independent Claims 

Manager. FEMA understands the 

commenters’ desire to have an 

Independent Claims Manager 

appointed. Given the short timelines 

that the Agency had to publish the IFR 

and begin processing claims, FEMA 

determined it was both efficient and 

effective to select a candidate with 

extensive experience in government 

assistance programs to lead the Claims 

Office. FEMA also understands 

concerns that other FEMA programs do 

not operate in the same way in which 

the Act requires the Claims Office to 

operate. However, FEMA was tasked 

with the implementation of the Act, 

including operation of the Claims Office 

for this Fire, and further has prior 

experience in operating a Claims Office 

in New Mexico for the Cerro Grande 

Fire in 2000. FEMA recognizes the 

distinctions between the two fires, but 

also believes the Agency can build on 

best practices and incorporate 

principles of equity, as well as lessons 

learned from the Cerro Grande Claims 

Office, to implement a Claims Office for 

the Hermit’s Peak/Calf Canyon Fire 

Assistance Act that will acknowledge 

the differences between the two fires 

and best serve the claimants and 

communities impacted by the Hermit’s 

Peak/Calf Canyon Fire. 

Comment: In addition to requesting 

an independent claims administrator, 

several commenters requested the 

claims administrator be a New Mexico 

attorney and/or retired judge. 

FEMA Response: As explained above, 

the Administrator has exercised her 

discretion and selected the Director of 

the Claims Office. The Director has 

extensive experience building and 

managing Federal assistance programs 

and will lead the Claims Office in these 

nascent stages. FEMA appreciates 

commenters’ concerns that the Claims 

Office be led by someone with 

familiarity with New Mexico law, as 

well as the unique political, economic, 

and cultural institutions of the impacted 

communities. FEMA has engaged in an 

extensive effort to recruit locally for 

positions to support the processing of 

claims and provision of compensation 

to claimants impacted by the Fire to 

ensure these specific concerns are 

addressed. FEMA believes that local 

hiring at all other levels of the Claims 

Office will better serve to meet the 

needs of claimants and communities 

rather than a single hire at the Director 

level. Additionally, FEMA is making 

changes in the Final Rule to better 

reflect the needs of the impacted 

communities. 

Comment: One commenter suggested 

another commenter be appointed as the 

Independent Claims Office 

Administrator. 

FEMA Response: As explained above, 

the Administrator has exercised her 

discretion to hire the Director of the 

Claims Office with extensive experience 

building and managing Federal 

programs to lead the Claims Office. 

2. Comments on the Claims Office 

Commenters offered suggestions on 

how to staff and manage the Claims 

Office. 

Comment: Commenters suggested that 

FEMA hire members of the local 

community to increase trust in the 

claims process. Some commenters 

stated the importance of hiring New 

Mexicans familiar with acequias. 

FEMA Response: FEMA agrees with 

these comments. As explained above, 

FEMA has engaged in an extensive 

effort to recruit locally for positions to 

support the processing of claims and 

provision of compensation to claimants 

impacted by the Fire to ensure these 

specific concerns are addressed.21

FEMA believes that hiring local 

applicants at all other levels of the 

Claims Office will better serve to meet 

the needs of claimants and communities 

by helping to ensure the Claims Office 

is staffed with individuals familiar with 

the specific needs of the communities 

impacted by the Fire. As of April 10, 

2023, almost 70 percent of the 

permanent Claims Office team are local 

staff.22 Local staff work out of Claims 

Offices in Santa Fe, Las Vegas, and 

Mora, New Mexico, and serve in 

multiple capacities ranging from the 

Deputy Director, Advocate and Claims 

Navigators, to external affairs and 

facility support. Additionally, FEMA is 

making changes in the Final Rule to 

better reflect the needs of the impacted 

communities. 

Comment: A commenter suggested 

FEMA stay alert to favoritism 

‘‘infiltrating the ranks of claims 

reviewers hired from the local 

population.’’ 

FEMA Response: FEMA appreciates 

the commenter’s concerns regarding 

favoritism. Federal employees are held 

to certain basic obligations of public 


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23 5 CFR 2635.101(b)(8). 

24See https://www.acquisition.gov/browse/index/ 

far. 25See https://www.fema.gov/hermits-peak. 

service that require employees to ‘‘act 

impartially and not give preferential 

treatment to any private organization or 

individual.’’ 23 As part of the hiring and 

onboarding process, these obligations 

are explained, and training is provided 

to ensure employees understand the 

obligations of public service. FEMA also 

is coordinating with the Department of 

Homeland Security Office of Inspector 

General and the FEMA Fraud unit to 

ensure vigilant oversight. 

Comment: Some commenters 

suggested FEMA hire a specific 

contractor to assist the manager and 

FEMA to process claims. 

FEMA Response: Consistent with the 

Federal Acquisition Regulation,24

FEMA awarded multiple competitive 

contracts to provide support services to 

the Claims Office. Services include 

consulting, claims processing, systems 

analysis, operation, and data analysis 

support. Each contractor shall, to the 

maximum extent possible, create 

opportunities for the utilization of local 

small businesses, including the utilizing 

of businesses from underserved 

communities and develop a plan to 

utilize local firms and/or hire local 

residents. 

Comment: One commenter suggested 

FEMA hire an experienced claims 

processor that can start handling claims 

immediately stating FEMA would need 

to figure out how to handle claims first. 

FEMA Response: The Claims Office 

engaged in a competitive hiring action 

to hire an experienced Claims Chief. 

This position oversees the claims 

process from the completion of the 

Notice of Loss to the final payout on the 

claim. The Claims Office also hired a 

number of experienced contract claims 

examiners with insurance adjusting 

experience to review and make 

recommendations on claims. The 

Claims Chief oversees Claims Reviewers 

at the main Claims Office, as well as at 

least three public-facing claims offices 

in Mora, San Miguel, and Las Vegas, 

New Mexico. 

Comment: A commenter suggested 

FEMA take the time that is required to 

provide substantial training for newly 

hired staff. 

FEMA Response: FEMA agrees that 

training will be critical for all newly 

hired staff for the Claims Office. FEMA 

intends to provide standard onboarding 

training for all new employees, as well 

as specialized training for all Claims 

Office employees to fully understand 

the claims process and the Act’s 

requirements. Training includes roles 

and responsibilities, claims processes 

and operations, cultural awareness, 

statutes and regulations, customer 

service and customer experience, risk 

reduction practices, coordination with 

State agencies, and other related 

trainings. 

Comment: One commenter provided a 

recent experience with a field inspector 

that inspected their homestead for 

potential disaster relief and stated that 

‘‘the person you chose to do this 

inspection is an incompetent at such 

work as this.’’ The commenter suggested 

FEMA be very careful in their hiring 

practices and contracting of third parties 

for claims office operations to prevent 

‘‘such outrageous incidents’’ as 

described in their experience. 

FEMA Response: FEMA appreciates 

the commenter’s honesty and 

willingness to share their experience. 

FEMA intends to staff the Claims Office 

with local hires that can better 

understand the unique political, 

economic, and cultural institutions of 

the communities impacted by the Fire, 

as well as claimants seeking 

compensation under the Act, in 

addition to experienced contract 

employees. As explained above, FEMA 

plans to provide training for all Claims 

Office employees to fully understand 

the claims process and the Act’s 

requirements. 

Comment: One commenter provided a 

memorandum with a seven-step process 

on how the Claims Office can develop 

a mindset to get to yes and serve clients 

effectively. This individual also 

submitted comments on the culture of 

the Claims Office. The comment 

‘‘focus[ed] on a seven-step plan to help 

this program transform its approach as 

it processes the regulation comments, 

from a denial-based approach to a 

positive, effective process for those it is 

meant to serve.’’ 

FEMA Response: FEMA appreciates 

the commenter’s detailed suggestions. 

As pointed out by the commenter, the 

Claims Office process will be different 

from FEMA’s disaster relief programs, 

and it will be important for employees 

of the Claims Office to acknowledge and 

embrace those differences in process 

and implementation efforts. Based on 

the comments received, FEMA 

established a set of guiding principles 

for the Claims Office culture needed to 

deliver this mission.25 FEMA will work 

to ensure a full understanding by the 

entire Claims Office staff of the claims 

process and the Act’s requirements and 

the importance of focusing on the needs 

of claimants and communities impacted 

by the Fire. With that in mind, the 

Claims Office provides each claimant 

with an assigned Navigator. The Claims 

Navigator works directly with the 

claimant and Claims Reviewers, asking 

questions, helping claimants obtain 

documentation, helping claimants 

complete the Notice of Loss and Proof 

of Loss, and shepherding the claimant 

through the process to better ensure that 

the claimant is fully compensated for 

their loss. 

The Claims Office has also established 

an independent Claims Office Advocate. 

The Claims Office Advocate responds 

to, manages, and recommends solutions 

to issues with the process itself, whether 

those issues be with the Claims 

Navigators and Claims Reviewers, the 

claims process itself, or how the process 

is being implemented. The Claims 

Office Advocate is responsible for 

identifying issues with the claims 

process and addressing those issues on 

the claimant’s behalf. The Claims Office 

Advocate serves as an additional 

resource to claimants by helping to 

improve their understanding of the 

claims process and providing guidance 

about the steps in that process and the 

associated requirements. 

The Claims Office Advocate also 

identifies issues, risks, and 

opportunities for improvement and 

develops recommendations for claims 

process enhancements that will address 

these and deliver a better, fairer claims 

process that is accessible to all 

claimants. While the Claims Navigators 

and Claims Reviewers report to a Team 

Lead, the Advocate reports directly to 

the Director of the Claims Office. As 

such, the Claims Office Advocate has a 

direct line of communication with the 

Director of the Claims Office, and the 

Advocate is positioned to advocate on 

behalf of claimants and to make 

recommendations for enhancements to 

the claims process. 

Comment: One commenter suggested 

that State Case Managers be integrated 

into the program and trained as 

Navigators. 

FEMA Response: FEMA anticipates 

that Claims Navigators will provide the 

assistance envisioned by the commenter 

and additional staffing outside of the 

Claims Office will not be required. 

However, the Claims Office is 

implementing procedures to coordinate 

with the State of New Mexico as 

appropriate. 

Comment: One commenter asked how 

many claims would be covered by each 

Claims Reviewer. 

FEMA Response: FEMA does not have 

an estimate on the volume of claims per 

Claims Reviewer at this time. FEMA 

anticipates Claims Reviewers will have 

a workload balance reflective of both 


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26Public Law 117–180, Division A, Section 136 

(2022). 

27Public Law 117–180, Division A, Section 136 

(2022). 28See Sections 102(b) and 104(c) of the Act. 

claim volume and claim complexity to 

ensure claimants’ needs are effectively 

met by the Claims Office. 

3. Comments on the Use of Funds 

Comment: Commenters sought 

clarification on how FEMA would use 

the funds provided by the Act between 

administrative costs and claims 

payments to claimants. Some 

commenters wrote about experiences 

with administrative costs with one 

commenter stating that ‘‘to provide a 

trailer for a family it can cost 300k with 

much of this money going to pay FEMA 

workers and for admin costs.’’ 

Commenters asked what the 

administrative costs would be and how 

much of the available appropriated 

funding would go to administrative 

costs and how much funding would go 

to claimants. One commenter wrote 

‘‘how much of the available funds will 

go to administration and how much will 

go to victims?’’. Another commenter 

stated, ‘‘I wonder what the 

administrative costs are if they are going 

to come out of this $2.5 billion of it is 

gone before any money goes to anybody 

in this room and maybe that’s 

necessary.’’ 

FEMA Response: Section 

104(a)(2)(C)(i) of the Act states that ‘‘The 

Office shall be funded from funds made 

available to the Administrator for 

carrying out this section.’’ FEMA is 

required to use the funding provided 

under the Act for the administrative 

costs to run the Claims Office. FEMA 

has a general obligation to spend 

Federal funds wisely and Congress 

required FEMA to provide quarterly 

reports to the Committee on 

Appropriations of the Senate and House 

of Representatives on the obligations 

and expenditures of the funds made 

available under the Act.26 Congress also 

directed a portion of the funding to the 

Department of Homeland Security 

Inspector General to fund program 

oversight. FEMA intends to comply 

with this Congressional reporting 

requirement regarding the use of 

funding under the Act. This 

transparency will help allay the 

commenters’ concerns about the total 

administrative costs for the Claims 

Office. 

Comment: Commenters suggested 

FEMA provide transparency in how the 

funds appropriated under the Act were 

spent. One commenter suggested that 

information about how the funds were 

being spent be shared publicly in real 

time via an online dashboard. Such a 

tool would help prevent internal fraud 

and help FEMA identify external fraud 

and program favoritism while also 

allowing everyone the ability to be 

alerted to something suspicious 

happening with funds. Another 

commenter agreed, recommending that 

FEMA allow the public to review the 

overall project budget and other 

transparency related to fiscal 

accountability. One commenter wrote 

that ‘‘FEMA should provide full 

transparency of cost, budget, 

expenditures, etc. including 

administrative costs, operational costs, 

total payouts, total denials, etc. to not 

only to the [Department of Homeland 

Security’s Office of the Inspector 

General] but also to the State—without 

violation of the Privacy Act.’’ 

FEMA Response: As explained above, 

Congress required FEMA to provide 

quarterly reports to the Committee on 

Appropriations of the Senate and House 

of Representatives on the obligations 

and expenditures of the funds made 

available under the Act.27 FEMA 

intends to comply with this 

Congressional reporting requirement 

regarding the use of funding under the 

Act. This transparency will help allay 

the commenters’ concerns about the 

total administrative costs for the Claims 

Office. In addition, the Claims Office 

Advocate will be creating easily 

understandable reports with program 

metrics to be shared on https://

www.fema.gov/hermits-peak and 

through other communications 

channels. 

Comment: Commenters also provided 

recommendations on ways to use and/ 

or distribute the funding appropriated. 

One commenter suggested funding be 

dedicated to the reintroduction of 

beavers to the region to help repair the 

land. 

FEMA Response: FEMA does not have 

the authority under the Act to dedicate 

funding as recommended by the 

commenter as claimants must submit 

claims demonstrating their injuries 

resulting from the Fire to obtain 

compensation. Funding for activities 

like reintroduction of beavers may be 

eligible as a nature-based solution to 

reduce the heightened risk of wildfire, 

flood, or other natural disaster and 

claimants seeking compensation must 

demonstrate that this claim is clearly 

tied to an increased risk that resulted 

from the Fires. 

Comment: A commenter wrote 

suggesting that FEMA ‘‘create a grid 

system on a map with a baseline 

payment scale using at least 1.5 billion 

dollars to be distributed equally where 

the [F]ire/flooding/damaged areas are 

the epicenter with the highest baseline 

($250,000) payment and the areas with 

lesser damage (such as minimal 

property damage, i.e., smoke damage or 

food loss) still receive baseline funding 

at a lesser significant (over $2,500) 

amount.’’ The commenter wrote that 

none of the funding provided should be 

taxable income. The commenter stated 

this proposal is to ‘‘ensure that all 

landowners in the affected areas get a 

baseline of funding.’’ The commenter 

also suggested ‘‘[$]2 billion in funding 

go to the public entities to prevent 

future disasters such as monies 

allocated to public safety.’’ The 

commenter suggested ‘‘another [$]1 

billion to public utility infrastructure 

and public communications.’’ The 

commenter wrote that the rest of the 

funding could be used for ‘‘paying out 

and making individuals with losses 

whole and covering gaps missed in my 

proposed comments above.’’ 

FEMA Response: FEMA is authorized 

under the Act to pay claimants for 

actual compensatory damages for 

injuries resulting from the Fire.28 FEMA 

does not have the authority under the 

Act to establish the type of funding 

system recommended by the commenter 

as claimants must submit claims 

demonstrating their injuries resulting 

from the Fire to obtain compensation. 

FEMA further did not receive sufficient 

funding under the Act to implement the 

payment plan proposed by the 

commenter. FEMA notes that the Act at 

section 104((h)(4) provides that the 

value of compensation provided under 

the Act ‘‘shall not be considered income 

or resources for any purpose under any 

Federal, State, or local laws, including 

laws relating to taxation . . .’’ FEMA 

cannot advise individual claimants on 

their individual tax obligations, 

however, and encourages claimants to 

consult with their tax advisers if they 

have questions related to tax 

obligations. 

Comment: A commenter asked 

whether the funding provided under the 

Act covered the costs for the matching 

funds requirement waiver in section 

104(k) of the Act or if the funding under 

the Act was exclusively reserved for 

claims. 

FEMA Response: The Act does not 

authorize FEMA to utilize the funds 

appropriated to cover the matching 

funds requirement waiver in section 

104(k). These additional matching funds 

to meet the 100 percent cost share will 

have to be provided from the funding 

provided for those programs generally, 

not the funding provided by the Act. 


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29See Public Law 117–180, Division A, Section 

136 (2022). 

Comment: Commenters suggested 

ways in which the funding appropriated 

under the Act should not be used. 

Commenters suggested administrative 

costs be paid out of a separate budget 

rather than the appropriated funding. 

One commenter suggested 

administrative costs should be paid for 

out of a separate FEMA budget. 

FEMA Response: As explained above, 

section 104(a)(2)(C)(i) requires FEMA to 

use the funding made available under 

the Act to fund the Claims Office. FEMA 

is required to follow the Act’s 

requirement to fund the Claims Office 

from the Act’s funding. 

Comment: One commenter requested 

FEMA Claims Reviewers tour the entire 

burn scar area and not to use the 

funding appropriated for that tour. 

FEMA Response: FEMA appreciates 

the request, the value placed in seeing 

the devastation resulting from the Fire 

first-hand, and the need for Claims 

Office staff to fully comprehend the 

extent of injuries suffered. FEMA plans 

to provide training to all Claims Office 

staff that will include extensive 

background information on the Fire and 

its impacts. FEMA believes that Claims 

Reviewers should be aware of the 

devastation to help comprehend the 

losses and spend their time focused on 

assisting claimants with their claims, 

not taking tours of the entire burn scar 

area. 

Comment: Commenters stated the 

funding appropriated was not sufficient 

to fully compensate claimants. One 

commenter suggested the total $3.9 

billion appropriated will not cover the 

cost of recovery from the level of 

destruction caused by the Fire. This 

commenter stated more destruction was 

guaranteed from the Fire and argued it 

would be worse if people rebuilt in the 

wrong places before the land stability is 

restored. Other commenters agreed that 

the amount appropriated was not 

sufficient to cover the damages and one 

of those commenters stated that the lack 

of sufficient funding would result in 

denying people compensation. 

FEMA Response: The Act and 

subsequent legislation appropriated 

$3.95 billion in funding. FEMA is 

obligated to provide quarterly reports to 

Congress on the use of funds under the 

Act and these reports ensure 

transparency of the use of funds and the 

sufficiency of funding under the Act. 

Comment: To combat fraud, one 

commenter recommended FEMA review 

fire-affected county audits performed by 

the New Mexico State Attorney 

General’s Office to anticipate where and 

how acts of fraud will occur. Another 

commenter stated in their comment the 

New Mexico State Auditor performs 

these audits, providing links to recent 

reports. 

FEMA Response: FEMA appreciates 

the concerns regarding potential fraud 

and is incorporating fraud awareness 

and detection training into the 

comprehensive training provided to all 

Claims Office staff. FEMA notes that 

Congress provided appropriations for 

the Department of Homeland Security’s 

Office of the Inspector General for 

oversight of activities authorized by the 

Act.29

Comment: A commenter stated that 

insurance companies would demand 

compensation for the amounts they have 

paid or will pay to insured claimants. 

FEMA Response: Insurance 

companies are eligible for compensation 

as injured persons under the Act. 

Section 104(d)(1)(A)(ii) of the Act 

requires FEMA to place priority on 

claims submitted by injured parties that 

are not insurance companies seeking 

payment as subrogees. Section 296.13 of 

the IFR requires subrogees to file their 

Notice of Loss after they have made all 

payments entitled to the injured person 

for Fire-related injuries under the terms 

of the insurance policy. As explained 

below, FEMA is amending § 296.13 in 

the Final Rule to add language from the 

Act specifically to clarify the claims 

prioritization required. Further, 

§ 296.21(f) of the regulation requires 

FEMA to compensate injured persons 

only for damages not paid and that will 

not be paid by insurance companies. As 

explained above, these provisions, in 

addition to the changes made to 

§ 296.13 in this Final Rule, will help 

ensure that the compensation is first 

made available to injured persons that 

are not insurance companies. 

Comment: Finally, commenters 

suggested other funds outside of those 

appropriated be used to pay for 

compensation under the Act. One 

commenter stated that FEMA ‘‘not use 

taxpayer dollars to compensate victims, 

but instead seize the assets of the oil 

and gas companies whose industry has 

created global warming and red flag 

conditions all over the country and use 

those assets to compensate victims.’’ 

One commenter suggested those 

responsible for causing the Fire should 

donate their retirement funds to those 

impacted by the Fire. 

FEMA Response: Congress 

appropriated $3.95 billion for 

implementation of the Act and FEMA is 

required to use that appropriated 

funding to implement the Act and pay 

claimants actual compensatory damages 

for injuries resulting from the Fire. 

4. Comments on § 296.5 Overview of the 

Claims Process 

Comment: One commenter suggested 

FEMA set up remote assistance given 

COVID, RSV, and influenza infection 

concerns. Another commenter stated 

that claimants should be allowed to 

meet remotely with claims reviewers as 

it was unreasonable for FEMA to expect 

victims to travel long distances. One 

commenter suggested FEMA set up 

mobile claim offices in southwest Colfax 

County and south Taos County. One 

commenter stated that ‘‘60 to 70 percent 

of the people up in Mora [County] are 

Hispanic and a lot of people don’t even 

have access to computers.’’ The 

commenter suggested FEMA ‘‘try to get 

somebody who can speak Spanish to go 

with these people because that’s what 

we need.’’ Commenters also suggested 

FEMA get out into the community as 

part of the claims process and outreach 

to the community. 

FEMA Response: FEMA plans to offer 

opportunities for one-on-one 

engagement through Claims Reviewers 

who will work to engage claimants in 

ways to meet their needs whether in 

person or via remote technology. Claims 

Office Navigators are trained to 

accommodate the needs of claimants 

and are prepared to meet them in the 

satellite Claims Offices in Las Vegas, 

Mora, and Santa Fe, New Mexico at 

claimants’ homes or offices, or any place 

convenient to claimants, taking into 

account health and safety concerns. 

Note that FEMA will provide services 

both at set office locations for the 

Claims Office, as well as pop-up offices 

that will rotate through communities 

and locations in the affected area, to 

reduce travel burdens on claimants. The 

pop-up offices will be staffed by Claims 

Navigators, who can assist claimants in 

completing and submitting Notices of 

Loss, providing claims updates, and 

answering general questions. FEMA 

recognizes the importance of having 

claims staff, who interact with claimants 

and help facilitate the claims process, 

that are able to speak both Spanish and 

English. FEMA locally hired bilingual 

speakers to ensure that claims staff can 

communicate with claimants in their 

preferred language. 

Comment: Several commenters wrote 

that attorneys should be notified during 

the process when claimants are 

represented by counsel. 

FEMA Response: With an appropriate 

Privacy Act waiver, FEMA will ensure 

contact is made with both claimants and 

their attorneys. The Claims Office has 

included consent language necessary to 

comply with the Privacy Act in the 

standard Notice of Loss form. The 


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consent is needed for an attorney or 

other third-party representative to have 

access to a claimant’s privacy 

information maintained in the Claims 

Office system of records. In addition to 

providing basic information about the 

claimant and representative, the 

claimant must sign the consent section 

if they choose to be represented by a 

third party. 

Comment: One commenter wrote that 

information on claim status and 

timeline to receive payment should also 

be easily accessible at the claimant 

level. Two commenters suggested FEMA 

provide an online method of checking 

the status of their claim and hard copies 

of documents for those claimants 

without internet access. 

FEMA Response: FEMA is currently 

developing an online claims system that 

will provide claimants with real time 

access to claim status in addition to 

providing status information by phone 

or mail (electronic and/or physical). 

FEMA anticipates this system will be 

rolled out in the near future and will 

provide outreach to the community 

when the system is available for use to 

help claimants understand and utilize 

the system. 

Comment: One commenter asked that 

State Case Managers be integrated into 

the program and trained as Navigators to 

serve as a single point of contact to help 

claimants throughout the process. 

FEMA Response: As explained above, 

FEMA anticipates that Claims 

Navigators will provide the assistance 

envisioned by the commenter and 

additional staffing outside of the Claims 

Office will not be required. In the event 

a claimant has unmet needs or 

otherwise requests a Disaster Case 

Manager, the standard Notice of Loss 

form includes a section for the claimant 

to consent to sharing claim data 

maintained in the system of record with 

Disaster Case Managers. 

Comment: Several commenters 

suggested that FEMA streamline the 

claims process. One method for 

streamlining the process suggested by 

commenters related to access to 

available Federal programs. 

Commenters suggested that FEMA 

streamline access to available Federal 

programs and, in addition to funds 

appropriated under the Act, to utilize 

other Federal funding opportunities 

when and where available. 

FEMA Response: FEMA agrees with 

this suggestion and is coordinating with 

other Federal agencies to ensure data 

sharing and better communication 

between programs. FEMA has engaged 

with and continues to engage with the 

Small Business Administration, the 

Department of Agriculture, and other 

Federal agencies to help facilitate 

coordination of the assistance available 

to claimants and the impacted 

communities. Consistent with the Act’s 

requirements in section 104(g), FEMA is 

consulting with other Federal agencies, 

and State, local, and Tribal authorities 

to ensure the efficient administration of 

the claims process and provide for local 

concerns. To preserve funding from the 

Hermit’s Peak/Calf Canyon 

appropriations to pay eligible claims, 

FEMA requires applicants eligible for 

FEMA’s Public Assistance program to 

exhaust available public assistance 

funds before seeking compensation from 

the Claims Office. 

Comment: Another suggestion 

involved preparing formulas for 

compensation. One commenter asked 

how FEMA would compensate 

claimants for a variety of damages and 

requested transparency and a formula 

that should be shared with claimants. 

Another commenter suggested that 

FEMA move forward with developing 

estimates to help reduce the wait for 

compensation. One commenter asked 

how claims would be made equitable 

and if there would be standard 

reimbursement rates for similar claims. 

Two commenters suggested monetary 

thresholds be established to ensure time 

and effort are proportionate to the claim 

values being made. As one of the 

commenters explained, there are 

thresholds throughout many other 

Federal programs where the burden of 

proof is significantly less based on the 

overall claim value. Another 

commenter, however, stated that ‘‘no 

two claims will be alike, and the process 

cannot be developed or allowed to 

become an assembly line approach.’’ 

FEMA Response: FEMA recognizes 

the need for an efficient, streamlined 

process through the use of a damage 

calculation formula, while also 

balancing the unique types of claims 

being presented under the Act and 

ensuring claimants are paid actual 

compensatory damage as required by 

the Act. FEMA anticipates developing 

some damage calculation formulas, such 

as providing for a certain dollar amount 

of compensation per acre of land 

damaged, so that claimants have the 

option to leverage one of those formulas 

or present their individual claim and 

request for specific damage amounts. 

FEMA believes this optionality will best 

balance the need for an efficient process 

with the individual needs of claimants, 

as claimants will be able to make the 

choice in presenting their claim for 

compensation. 

5. Comments on § 296.10 Filing a Claim 

Under the Act 

Comment: One commenter suggested 

FEMA allow claimants to file a Notice 

of Loss in person consistent with the 

IFR. Another commenter stated that 

FEMA should allow claimants to file 

claims in person, as well as via mail, 

email, and a web-based portal system to 

ensure accessibility. A commenter 

suggested FEMA allow for applications, 

correspondence, and supporting 

documentation to be exchanged by 

postal mail. This commenter also 

recommended FEMA create centralized 

locations where northern New Mexicans 

can physically go to access the 

electronic application and receive 

assistance in filling out the applications 

in multiple languages so that the 

application and supporting 

documentation can be submitted in a 

timely manner. 

FEMA Response: FEMA appreciates 

these suggestions. FEMA does not 

believe changes to the Final Rule are 

necessary to implement these 

suggestions, but rather that as the 

Claims Office continues to expand 

operations, the information would be 

made available to the public via https:// 

www.fema.gov/hermits-peak and other 

resources including direct community 

outreach. FEMA is currently accepting 

Notice of Loss forms in person at the 

claim’s office locations in Santa Fe, 

Mora, and Las Vegas, New Mexico and 

those office addresses can be found at 

https://www.fema.gov/hermits-peak. 

FEMA will provide services both at set 

office locations for the Claims Offices, 

as well as pop-up offices that will rotate 

through communities and locations in 

the affected area, to reduce travel 

burdens on claimants. The pop-up 

offices will be staffed by Claims 

Navigators, who can assist claimants in 

completing and submitting Notices of 

Loss, providing claims updates, and 

answering general questions. 

6. Comments on § 296.11 Deadlines 

Comment: Several comments were 

received regarding the two-year 

deadline for filing a claim detailed in 

§ 296.11 of the IFR, with most 

commenters stating that a two-year 

period to file a claim was insufficient. 

Commenters suggested extending the 

deadline based on an inability to 

determine damages because of the 

current inability to access their 

property, the potential for future 

impacts from flooding, and/or the longterm health and environmental effects 

given the size and scope of the Fire. A 

commenter suggested extending the 

deadline to three years for mitigation 


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30 87 FR 68085 (Nov. 14, 2023). 

efforts. Some commenters asked FEMA 

to be flexible in granting extensions. 

One commenter asked that extensions 

be granted in cases where knowledge of 

damages, recovery efforts, etc. are 

hindered by cooperation with 

government agencies. 

FEMA Response: Some deadlines in 

the rule are beyond FEMA’s control. 

Section 104(b) of the Act requires 

claimants submit their Notice of Loss no 

later than November 14, 2024, two years 

from the date the IFR was promulgated. 

FEMA was required by the Act to 

publish the IFR within 45 days of the 

Act’s passage and the IFR was published 

45 days after the Act’s passage.30 FEMA 

has built in extensions of the claim 

processing timeline after receipt of the 

Notice of Loss for good cause, 

recognizing the realities of the Fire’s 

impact. Sections 296.34 and 296.35 

establish a process for notifying FEMA 

of injuries that are not referenced in the 

initial Notice of Loss. Whether a 

claimant tells FEMA about an injury in 

the initial Notice of Loss or an 

amendment under § 296.34, FEMA must 

know about the injury by November 14, 

2024. For heightened risk reduction 

efforts, a claimant must include the 

claim in their Notice of Loss by 

November 14, 2024, or an amended 

Notice of Loss filed no later than 

November 14, 2025. See § 296.21(e)(5). 

Comment: One commenter indicated 

the two-year period did not end on 

November 14, 2024, because the Final 

Rule had not been promulgated and it 

would not be promulgated until 60 days 

after filing in the Federal Register. 

FEMA Response: FEMA disagrees 

with this characterization of the twoyear period and rule promulgation. 

Specifically, Section 104(f)(1) of the Act 

requires FEMA to ‘‘promulgate and 

publish in the Federal Register interim 

final regulations for the processing and 

payment of claims under this Act.’’ 

Publication of an IFR constitutes 

promulgation of a rule, as the rule was 

effective upon publication, and 

comments were requested postpromulgation. This sequence of events, 

publication of the interim final rule, 

followed by a public comment period, 

occurred here. Consistent with the Act’s 

purpose at section 102(b), the 

immediate effective date of the rule 

ensures FEMA was able to begin 

accepting and processing claims on the 

date of publication. 

7. Comments on § 296.12 Election of 

Remedies 

Comment: Commenters sought 

clarifications about how the election of 

remedies worked. One commenter asked 

what would happen if the claimant did 

not accept the final determination by 

the Claims Office. Another commenter 

asked if people did not want to go 

through FEMA, whether they could sue 

and if there were multiple owners of a 

single property whether some could go 

through FEMA and also sue. 

FEMA Response: As explained in the 

IFR’s preamble, the Act provides that an 

injured person who accepts an award 

under the Act waives the right to pursue 

any claims arising out of or relating to 

the same subject matter under the 

Federal Tort Claims Act (FTCA) or a 

civil lawsuit. Similarly, those claimants 

who accept an award under the FTCA 

or a civil lawsuit waive the right to 

pursue claims under the Act. Until the 

final award payment is accepted, the 

claimant may pursue any and/or all of 

the options available. This flexibility 

allows injured persons to pursue 

different avenues of compensation until 

a final award is accepted. The IFR 

language states that an injured person 

who accepts an award under the Act or 

through a FTCA or civil action waives 

their right to pursue all claims for 

injuries arising out of or related to the 

same subject matter. To ensure this is 

clear in the Final Rule, FEMA is 

revising paragraphs § 296.12(a) and (b) 

to clarify that the injured person only 

waives the right to pursue all claims 

upon acceptance of a final award 

through the Act, the FTCA, or through 

a civil action. 

Comment: A commenter stated that a 

claimant’s right to civil action or other 

redress should not be waived or limited 

until a final payment has been agreed 

upon with FEMA, and that it must be 

clear to claimants at what point(s) in the 

process they are waiving their rights to 

further legal action, as well as how they 

can retain their right to further legal 

action for different types of subject 

matter. Another commenter agreed and 

recommended FEMA clarify that the 

waiver of the right to pursue claims 

under the FTCA or a civil action only 

applies to final awards, and when the 

claimant has signed a Release and 

Certification Form. 

FEMA Response: FEMA agrees and as 

explained above, is revising § 296.12(a) 

and (b) in the Final Rule to clarify that 

the injured person only waives the right 

to pursue all claims upon acceptance of 

a final award. 

Comment: One commenter wrote on 

the feasibility of waiving future claims 

given the extent of damages, losses, and 

expenses may not be fully known at the 

time of the award. The commenter 

suggested a lump sum payment of 15 

percent of all injury, damages, losses, 

and expenses be added to each claim to 

cover these future unknown items. 

FEMA Response: FEMA understands 

the concerns with waiving rights to 

pursue further claims after accepting a 

final award. The Act at section 104(b) 

requires claims to be submitted within 

two years and requires a waiver of rights 

to pursue further claims upon 

acceptance of a final award. Claims 

related to future losses as a result of the 

Fire would need to be made through 

other remedies as the Act sets a twoyear limitation for claims under the Act. 

FEMA is unable to pay lump sum 

payments to cover future unknown 

injuries, as unknown injuries are 

speculative in nature and the Act 

requires FEMA to pay for actual 

compensatory damages. 

Comment: Commenters stated the 

Federal government committed crimes 

and that the Act did not preclude 

criminal charges. These commenters 

recommended allowing claimants the 

ability to apply for crime victim 

compensation. 

FEMA Response: As explained above, 

the Act sets forth means for claimants to 

seek compensation for injuries suffered 

as a result of the Fire. Section 104(h) of 

the Act offers claimants three options to 

seek compensation from the Federal 

government for injuries resulting from 

the Fire: (1) a claim under the Act; (2) 

a FTCA claim or civil action; or (3) an 

authorized civil action under any other 

provision of law. The Act does not 

expand the scope of the FTCA or other 

civil actions under any other provision 

of law. The Act does not provide for 

criminal prosecution or other remedies. 

The Act also does not provide for crime 

victim compensation. Rather, section 

104(c)(3) of the Act provides for 

payment of actual compensatory 

damages. FEMA is not authorized under 

the Act to pay additional compensation 

beyond actual compensatory damages. 

Comment: One commenter stated the 

Federal government ‘‘should not be 

allowed to dictate limits on 

compensation to victims they violated. 

The victims should be allowed to state 

what will make them individually 

whole and what will be required for 

their healing for the next several years, 

or however long it takes, to recover from 

the offending actions as only the victim 

will know what that is and what it will 

take for them to heal.’’ The commenter 

further stated that claimants should not 

be required to use other Federal 

programs. 

FEMA Response: As explained above, 

Section 104(h) of the Act offers 

claimants three options to seek 

compensation from the Federal 

government for injuries resulting from 


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31 31 U.S.C. 3727(b). 

32 Id. 

33 Id. 

34See United States v. Shannon, 342 U.S. 288 

(1952). 

35See Uniform Probate Code, Chapter 45, New 

Mexico Statutes Annotated (2021). 

36 31 U.S.C. 3727(b). 

the Fire: (1) a claim under the Act; (2) 

a FTCA claim or civil action; or (3) an 

authorized civil action under any other 

provision of law. Claimants may choose 

among these remedies to address their 

personal circumstances and needs, 

taking into account timely resolution 

and costs of each option. Only upon 

acceptance of a final compensation 

award under one of these options will 

claimants release the Federal 

government from further claims arising 

out of or relating to the same subject 

matter. The Act further requires in 

section 104(d)(1)(B) that FEMA make 

determinations as to whether the 

claimant is an injured person under the 

Act; the injury resulted from the Fire, 

whether the claimant is otherwise 

eligible to receive payment, whether 

sufficient funds are available for 

payment, and the amount to be allowed 

and paid under the Act. The Act only 

authorizes FEMA to make these 

determinations and sets the framework 

for how FEMA must make them. The 

Act does not authorize FEMA to honor 

and accept all requests for 

compensation. 

8. Comments on § 296.13 Subrogation 

Comment: Three commenters 

suggested FEMA delete references to 

insurance companies in the regulation. 

One commenter stated that insurance 

companies will demand compensation 

for the amounts they have paid or will 

pay to insured claimants and found that 

to be fair. However, the commenter 

stated that greed may influence the 

insurers’ claims and those claims would 

then negatively affect claimant 

compensation. Two other commenters 

stated that this section should be 

revised to reflect the Act’s prioritization 

of injured persons over subrogees. 

FEMA Response: As explained above, 

insurance companies are injured 

persons under the Act. FEMA does not 

believe it is appropriate to delete 

references to insurance companies in 

the regulation, as the Act’s references to 

them requires FEMA to discuss them in 

the regulation. Section 104(d)(1)(A)(ii) 

requires FEMA to place priority on 

claims submitted by injured parties that 

are not insurance companies seeking 

payment as subrogees. Section 296.13 of 

the IFR requires subrogees to file their 

Notice of Loss after they have made all 

payments entitled to the injured person 

for Fire-related injuries under the terms 

of the insurance policy. The IFR does 

not, however, include the prioritization 

language from the Act. Given the 

confusion and concerns with this 

section, FEMA is amending § 296.13 to 

specifically clarify the prioritization 

required under the Act in the Final Rule 

by requiring that subrogation claims 

from insurance companies will be paid 

only after paying claims submitted by 

injured persons that are not insurance 

companies seeking payment as 

subrogees. 

9. Comments on § 296.14 Assignments 

Comment: Several commenters stated 

that assignment of rights could not be 

prohibited. Commenters stated that New 

Mexico law allowed for assignment of 

rights. A commenter stated that ‘‘New 

Mexico law allows lawyers to recover 

their fees by way of liens, and FEMA 

regulations should not seek to interfere 

with the lawyer and client relationship 

nor with the ability of the claimant’s 

lawyer to recover their fee.’’ The 

commenter also wrote that the FTCA 

has no prohibition on assignments. 

FEMA Response: FEMA disagrees that 

the assignment of rights cannot be 

prohibited. Federal law generally 

prohibits assignment of claims against 

the Federal government. The 

Assignment of Claims Act prohibits the 

assignment of a claim against the 

Federal government unless the claim is 

allowed, the amount of the claim is 

decided, and a warrant for payment of 

the claim has been issued.31 The 

Assignment of Claims Act requires that 

the assignment must specify the warrant 

and the assignment must be made freely 

and attested to by two witnesses.32 The 

person making the assignment must 

acknowledge it before an official who 

may acknowledge a deed, that official 

must certify the assignment, and the 

certificate issued by the official must 

state that the official explained the 

assignment when it was 

acknowledged.33 Thus, FEMA can only 

allow for an assignment of a claim after 

the Authorized Official’s Determination 

has been issued and accepted by the 

claimant and the claimant has 

completed the other steps in the process 

required under the Federal law to have 

the assignment reference FEMA’s award 

determination. The process includes 

being attested to by two witnesses and 

acknowledged by an official who will 

certify the assignment and their 

explanation of the assignment to the 

claimant. This extensive process is 

contrary to the authorizing Act’s 

purpose and the requirements placed on 

FEMA by the Act to compensate victims 

of the Fire and expeditiously settle 

claims for those injured. Prohibiting 

assignment of claims under the Act is 

consistent with the purpose of the Act 

and other Federal law. The Final Rule 

will not include amendments to the 

assignment of rights. FEMA notes that 

assignments are generally not allowed 

under the Federal Tort Claims Act.34

Also, to the extent that a lien does not 

involve an assignment, it is a question 

of State law to be resolved between the 

lien holder and the claimant. 

Comment: Three commenters 

suggested that assignment be allowed in 

instances of death, with one other 

commenter also requesting a process by 

which compensation can be provided to 

surviving heirs if a claimant passes 

away. These commenters stated that if 

the claim is legitimate, the owner’s right 

to assign for a variety of reasons should 

not be limited. Another commenter 

suggested provisions be made for 

dependent family members and 

property co-owners to receive full 

compensation in situations where a 

claimant dies. 

FEMA Response: Claimants who pass 

away during the claims process can 

continue to pursue claims through their 

surviving heirs under applicable New 

Mexico estate law.35 An assignment of 

rights is not required for surviving heirs 

to pursue a claim under the Act. FEMA 

notes that some claimants may wish to 

have family members pursue the claim 

on their behalf and some commenters 

during public meetings stated they were 

pursuing claims on behalf of relatives. 

The current regulatory text allows a 

claimant to authorize a relative or other 

third party to have access to claims 

information and to represent them on 

the claim by executing the appropriate 

section in the Notice of Loss. The 

authority to represent a claimant does 

not require an assignment of benefits. 

Comment: A commenter stated FEMA 

did not have the authority under the Act 

or New Mexico law to restrict 

assignment of property, stating 

claimants should have the right to sell 

their property and the new property 

owner should be able to recover 

damages to the property as well as 

family assignment in case of death. 

Another commenter requested that they 

be able to assign their claim if they want 

to sell their property or have someone 

inherit their claim. 

FEMA Response: FEMA disagrees that 

the assignment of rights cannot be 

prohibited. As explained above, Federal 

law generally prohibits assignment of 

claims against the Federal 

government.36 The extensive process 

required to assign claims against the 


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37See generally Spofford v. Kirk, 97 U.S. 484, 489 

(1878) ‘‘the question remains, whether the act of 

Congress was not intended to render all claims 

against the government inalienable alike in law and 

in equity, for every purpose, and between all 

parties. The intention of Congress must be 

discovered in the act itself. It was entitled ‘An Act 

to prevent frauds upon the treasury of the United 

States.’ It may be assumed, therefore, that such was 

its purpose. What the frauds were against which it 

was intended to set up a guard, and how they might 

be perpetrated, nothing in the statute informs us. 

We can only infer from its provisions what the 

frauds and mischiefs had been, or were 

apprehended, which led to its enactment.’’ 

Federal government is contrary to the 

authorizing Act’s purpose and the 

requirements placed on FEMA by the 

Act to compensate victims of the Fire 

and expeditiously settle claims for those 

injured. Prohibiting assignment of 

claims under the Act is consistent with 

the purpose of the Act and other Federal 

law and is not amending the Final Rule. 

The Final Rule will not include 

amendments to the assignment of rights. 

Comment: One commenter said that 

claimants should have the ability to 

assign rights to family members or 

friends but stated ‘‘assignment of rights 

cannot be to the detriment of the 

individual signing it away or to the 

benefit of the person who is trying to get 

it.’’ This commenter further stated that 

they ‘‘want to see representation for 

people who need it but not necessarily 

assign the rights over.’’ 

FEMA Response: FEMA appreciates 

the commenter’s concerns and believes 

that assigning rights in the context of a 

claim under the Act could result in 

unscrupulous activity. The extensive 

process required by the Assignment of 

Claims Act to assign a claim against the 

Federal government was put in place for 

several reasons, one of which was to 

reduce concerns about predatory 

assignments.37 FEMA seeks to avoid 

situations where predatory assignments 

could occur. Consistent with Federal 

law and the reasons stated above, FEMA 

is not amending the Final Rule. 

Comment: A commenter wrote that 

FEMA should modify this section to 

allow the State of New Mexico to file a 

claim on behalf of residents solely for 

private property debris removal work 

not eligible for Category A/B 

reimbursements under the Public 

Assistance Program. Another 

commenter wrote of a shortage of 

available contract resources impacting 

the cost and timing of rebuilding efforts 

and recommending FEMA allow 

individuals to permit State agencies to 

act on their behalf to address debris 

removal and damage through a opt in 

assignment. Other commenters stated 

concerns with the effective use of funds 

for debris removal generally. 

FEMA Response: FEMA recognizes 

the challenges presented with debris 

removal on private property and the 

concerns with ensuring funding is 

effectively utilized under the Act. Under 

the Act, the Claims Office is authorized 

to compensate injured persons for their 

injuries resulting from the Fire. The 

Office recognizes that due to the timing 

of debris removal, as well as other 

elements of a claim, a claimant may 

require funds quickly and is prepared to 

make partial payments to claimants for 

severable elements of a claim, including 

debris removal, allowing claimants to 

choose who clears the debris. 

F. Comments on § 296.21(a) Allowable 

Damages 

1. Comments on Allowable Damages 

Generally 

Comment: Several commenters 

suggested FEMA cover specific types of 

damages and detail them further in the 

regulation. Commenters frequently 

requested that the claims process ‘‘make 

them whole.’’ One commenter often 

recited specific types of damages for 

which FEMA should be prepared to 

compensate (to make whole) to include 

those damages they considered to be 

‘‘immeasurable’’ or ‘‘unseen.’’ One 

commenter stated that ‘‘FEMA must 

compensate injured victims for 

immediately measurable losses (i.e. 

destroyed homes, buildings and their 

contents, property infrastructures, 

forestland resources, croplands and 

crops, and domestic water conveyances 

and storage facilities, etc.) and for 

intangible losses as well (i.e. destroyed 

sentimental items which can never be 

replaced, mental and emotional tolls 

regardless of the extent of professional 

treatment received, and future potential 

value of everything damaged and lost).’’ 

One commenter stated that, in addition 

to damage caused as a result of the Fire, 

‘‘there is more damage continuing to 

happen to injured victims each day on 

a level which cannot be seen, measured, 

or described by any metric’’ and further 

that the Act’s ‘‘reconciliations should go 

far beyond mere recovery to day-beforethe-fire life conditions for every injured 

victim because the damage runs far 

deeper and much wider than what 

actually burned in the fire. It has 

severely, irreversibly damaged injured 

victims’ souls, and they deserve to be 

compensated for that too.’’ 

FEMA Response: FEMA recognizes 

the significant injuries suffered by 

claimants and the long-term recovery 

needed for the communities impacted 

by the Fire. The Act at section 

104(c)(3)(A) limits payment to ‘‘actual 

compensatory damages measured by 

injuries suffered.’’ Section 104(d)(4) of 

the Act limits allowable damages to 

uncompensated damages for loss of 

property, business loss, and financial 

loss; and therefore, limits the actual 

compensatory damages FEMA may 

provide to economic damages. This 

limitation of the Act with respect to 

allowable damages excludes noneconomic damages such as pain and 

suffering. FEMA recognizes that making 

people whole for the full scope of loss 

after a devastating fire may not be 

possible. The Act authorizes payment of 

damages, and money cannot restore the 

full array of the human experience. 

Section 296.21(e)(3) does authorize 

payment for out-of-pocket mental health 

treatment expenses, which can help 

alleviate the emotional suffering and 

enable affected individuals to recover. 

Where New Mexico law allows pain and 

suffering and non-economic damages in 

limited circumstances primarily 

involving personal injuries, a claimant 

that suffered personal injury may 

choose to pursue a judicial remedy 

against the United States Forest Service 

under the Federal Tort Claims Act or 

other civil law. The Act provides the 

claimant with considerable flexibility 

and allows the claimant to opt out of the 

Claims Office option and into litigation 

at any time up until acceptance of a 

final offer. 

2. Comments on Non-Economic 

Damages 

Several commenters wrote that noneconomic damages must be considered 

allowable damages. 

Comment: One commenter wrote that 

claimants were entitled to claims for 

nuisance and trespass for fire damage to 

their property under New Mexico law. 

Another commenter expanded on the 

nuisance theory stating ‘‘A wildfire 

likely qualifies [as] a private or mixed 

public/private nuisance, and therefore is 

actionable either way, at least for those 

who suffered damage to their real or 

personal property. Noneconomic 

damages are recoverable for a nuisance 

claim for ‘annoyance, discomfort, and 

inconvenience.’ Notably, a plaintiff 

need not prove economic damages (e.g., 

a diminution in property value) to 

recover damages for ‘annoyance, 

discomfort, and inconvenience.’ ’’ 

FEMA Response: The Act does not 

authorize FEMA to provide noneconomic damages for nuisance and 

trespass. 

Comment: A different commenter also 

noted the potential trespass claim, 

writing ‘‘A defendant commits commonlaw trespass in New Mexico by 

redirecting a foreign substance onto the 

plaintiff’s property. . . . Under this 


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38 145 N.M. 205 (2008). 

reasoning a wildfire that spreads onto a 

plaintiff’s property would also 

constitute a trespass. Although a 

plaintiff may recover damages for 

‘annoyance, discomfort, and 

inconvenience’ caused by a private 

nuisance, there is no New Mexico 

authority expressly allowing similar 

damages on trespass claims. That said, 

many jurisdictions allow damages for 

annoyance, discomfort, and distress 

proximately caused by a trespass. Some 

of these distinguish between those 

damages and emotional distress, while 

others appear to conflate the two. New 

Mexico would likely strictly limit 

recovery to ‘annoyance, discomfort, and 

distress’ and not allow true emotionaldistress damages.’’ 

FEMA Response: The Act does not 

provide for non-economic damages for 

nuisance and trespass. 

Comment: Several commenters stated 

emotional distress, disturbance, 

annoyance, and other non-economic 

losses for those with real and/or 

personal property losses from the Fire 

regardless of whether or not the 

claimant suffered a physical injury as 

well as those same losses for those 

claimants who suffered a reasonable fear 

of death or serious bodily injury as a 

result of their proximity to the zone of 

fire danger, regardless of whether the 

claimant suffered a physical injury 

should be compensated. 

FEMA Response: The Act does not 

provide for non-economic damages for 

emotional distress, disturbance, and 

annoyance. 

Comment: Three commenters 

supported the expansion of allowable 

damages to include non-economic 

damages, including loss of enjoyment, 

loss of lifestyle, as well as mental and 

emotional distress, sentimental losses, 

and disturbance and annoyance 

damages. These commenters stated that 

these losses may be greater and more 

important than the financial loss. 

FEMA Response: The Act does not 

authorize FEMA to provide noneconomic damages for loss of 

enjoyment, loss of lifestyle, mental and 

emotional distress, sentimental losses, 

or disturbance and enjoyment., 

3. Comments on Emotional Distress/ 

Mental Health Damages 

Some commenters stated the specific 

non-economic damages for which they 

suggested compensation should be 

available under the Act. 

Comment: One commenter wrote 

suggesting claimants could assert a 

claim for intentional infliction of 

emotional distress, stating ‘‘those 

individuals who were within the fire’s 

zone of danger and had a reasonable, 

objective fear of death or serious bodily 

injury should be able to recover noneconomic, emotional distress damages 

as well . . . Emotional distress is 

available under New Mexico law when 

there is a physical injury . . . These 

victims suffered smoke inhalation, 

which is a physical injury, and thereby 

makes them eligible for emotional 

distress damages under New Mexico 

law.’’ 

FEMA Response: The Act does not 

authorize FEMA to provide noneconomic damages for intentional 

infliction of emotional distress. 

Comment: A commenter wrote that 

New Mexico law recognizes claims for 

both negligent and intentional infliction 

of emotional distress. The commenter 

discussed negligent infliction of 

emotional distress and intentional 

infliction of emotional distress, stating 

that claimants may be able to allege an 

intentional infliction of emotional 

distress claim by ‘‘showing the 

defendant’s conduct was reckless and 

outrageous enough to warrant liability.’’ 

The commenter further noted that 

claimants prevailing on either claim for 

infliction of emotional distress would be 

entitled to damages for ‘‘physical pain, 

nervousness, grief, anxiety, worry, and 

shock.’’ The commenter added that the 

Federal government had a special 

relationship with claimants given their 

responsibility for the control of the 

forests and had neglected that special 

relationship, ignored its own 

regulations, and caused much emotional 

distress. 

FEMA Response: The Act does not 

authorize FEMA to provide noneconomic damages for negligent and 

intentional infliction of emotional 

distress. 

Comment: One commenter stated that 

the FTCA includes damages for 

emotional distress and that New Mexico 

law also provided the authority to 

award emotional distress damages. The 

commenter also stated that disturbance 

and annoyance damages for the 

interference of real property, which are 

non-economic damages, are recoverable. 

The commenter also cited to Castillo v. 

City of Las Vegas 38 as another source for 

recoverable non-economic damages 

including emotional or sentimental 

damages. 

FEMA Response: The Act does not 

authorize FEMA to provide noneconomic damages for emotional 

distress If a claimant believes they are 

eligible for non-economic damages 

under New Mexico law and the Federal 

Tort Claims Act, they may choose to file 

a civil claim against the United States 

Forest Service in Federal court. They 

may file suit at any time prior to 

acceptance of a final determination. 

Comment: One commenter stated that 

FEMA should provide reimbursement 

for the physical, the mental, and the 

emotional stress caused by the Fire and 

referenced the Camp Fire in California 

as an example of where these types of 

damages were paid. 

FEMA Response: The Act does not 

authorize FEMA to provide noneconomic damages for physical, mental, 

and emotional distress. The Camp Fire 

claims were adjudicated applying 

California law, which differs 

significantly from the Hermit’s Peak/ 

Calf Canyon Fire Assistance Act. The 

Camp Fire claims also involved claims 

asserted in a bankruptcy proceeding 

against a private company, not the 

Federal government. 

4. Comments on Other Damages 

Commenters also raised compensation 

for future work and loss of opportunity, 

future potential land use plans, 

sentimental value, and loss of wildlife. 

Comment: One commenter asked how 

claimants would be compensated for the 

conservation practices of the area, 

including grazing and thinning out 

dense forest lands and making habitat 

for wildlife. The commenter also asked 

how claimants would be compensated 

for future work and loss of opportunity 

for those conservation practices. 

FEMA Response: Congress established 

the Claims Office to provide actual 

compensatory damages to injured 

persons that suffered injury resulting 

from the Fire. To the extent that 

individual claimants establish injury 

from the Fire, the Claims Office will 

work with them to identify appropriate 

measures of damage. The Claims Office 

is prepared to work with claimants to 

identify and hire experts to assist in 

valuing complex or unusual claims. 

Under the Act, other Federal agencies 

with particular expertise also can be 

engaged to assist. 

Comment: Another commenter wrote 

suggesting FEMA consider future land 

use plans to properly compensate 

claimants, detailing their own plans for 

development of their property impacted 

by the Fire. 

FEMA Response: Under the Act, the 

Claims Office provides provide actual 

compensatory damages to injured 

persons that suffered injury resulting 

from the Fire. Some claims may be too 

speculative to be eligible for tort 

compensation under applicable law, but 

all potential claimants are encouraged to 

submit a Notice of Loss to enable the 

Claims Office to evaluate individual 

claims. 


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Comment: One commenter wrote that 

New Mexico law allows recovery of 

sentimental value for personal and real 

property and stated that victims are not 

made whole unless they recover both 

the economic value of contents, 

structures, and trees, plus their 

sentimental value. 

FEMA Response: Under the Act, the 

Claims Office provides provide actual 

compensatory damages to injured 

persons that suffered injury resulting 

from the Fire, but not for non-economic 

damages. All potential claimants are 

encouraged to submit a Notice of Loss 

to enable the Claims Office to evaluate 

individual claims. The Office will work 

with claimants to identify eligible 

economic losses and to properly value 

claims. FEMA does not believe changes 

to the regulatory text are required in the 

Final Rule for claimants to seek this 

type of compensation if they can 

demonstrate the loss and that the loss 

resulted from the Fire. 

In addition to specific damages, 

commenters suggested FEMA provide 

compensation for specific 

reimbursements associated with 

damages. 

Comment: Two commenters suggested 

FEMA compensate for property taxes, 

either to the local government or 

individual property owners. One of 

these commenters suggested property 

taxes be addressed by the New Mexico 

legislature, as it was for the Cerro 

Grande Fire, and that Federal funds 

should pay State and local governments 

the difference in property tax funds. 

FEMA Response: Under the Act, the 

Claims Office provides actual 

compensatory damages to injured 

persons that suffered injury resulting 

from the fire. All potential claimants are 

encouraged to submit a Notice of Loss 

to enable the Claims Office to evaluate 

individual claims. The Office will work 

with claimants to identify eligible 

economic losses and to properly value 

claims. FEMA does not believe changes 

to the regulatory text are required in the 

Final Rule for claimants to seek this 

type of compensation if they can 

demonstrate the loss and that the loss 

resulted from the Fire. 

Comment: One commenter suggested 

FEMA pay for indirect damage, 

including damages resulting from 

mandatory evacuation, burn scar 

flooding, and contractor damages. 

FEMA Response: To the extent that 

damage resulted from the Fire, damages 

are compensable under the regulation as 

written. Specifically mandatory 

evacuation expenses and burn scar 

flooding can be compensable if resulting 

from the Fire. Contractor damages may 

not be compensable, but the Claims 

Office encourages claimants to submit 

all possible losses to be evaluated. As 

previously explained, the regulation 

provides types of actual compensatory 

damages that are compensable under the 

Act, but that list is not all-inclusive. 

Claimants seeking compensation for 

actual compensatory damages not 

specifically listed in the regulation can 

still submit a claim for compensation 

under the Act. 

Comment: Other commenters 

suggested that FEMA provide air and 

water quality testing/monitoring. 

FEMA Response: FEMA understands 

the concerns regarding water and air 

quality and the need for testing and 

monitoring. These types of expenses 

might be compensable as expert opinion 

expenses under § 296.31(a) or as part of 

the lump sum incidental expenses for 

claims expenses reimbursement under 

§ 296.31(b). 

Comment: Two commenters suggested 

funding to address economic 

development as the population (per 

capita) had decreased since the Fire, as 

either business and/or financial loss 

under the Act. 

FEMA Response: Economic 

development can be speculative and a 

claimant seeking compensatory damages 

for loss of economic development 

would need to be able to demonstrate 

such loss and that such loss was a result 

of the Fire. As explained above, the 

regulation provides types of actual 

compensatory damages that are 

compensable under the Act, but that list 

is not all-inclusive. Claimants seeking 

compensation for actual compensatory 

damages not specifically listed in the 

regulation should still submit a claim 

for compensation under the Act. For 

this type of claim, claimants can work 

with their Claims Navigator and Claims 

Reviewer to demonstrate that such 

damages would be considered actual 

compensatory damages for injuries 

resulting from the Fire consistent with 

the Act. FEMA does not believe changes 

to the regulatory text are required in the 

Final Rule for claimants to seek this 

type of compensation if they can 

demonstrate the loss and that the loss 

resulted from the Fire. 

Comment: One commenter suggested 

an additional amount be awarded where 

the claimant dies to compensate for the 

further injury inflicted as a result of 

delays in compensation. 

FEMA Response: FEMA disagrees 

with this commenter. This proposed 

claim would not be for actual 

compensatory damages for injuries 

resulting from the Fire and is not 

authorized. 

5. Comments on Flood Damages 

Comment: One commenter suggested 

FEMA add flood damage to § 296.21(a) 

writing that it was ‘‘illogical to provide 

compensation for flood insurance as a 

financial loss in § 296.21(e)(2) but not 

for flood damage.’’ A different 

commenter stated that claimants face 

risks of further injury from flooding, 

landslide/mudslide, and debris flow 

and that full cooperation from owners of 

all affected property parcels located 

upstream and upslope was essential to 

recovery. The commenter requested 

FEMA acknowledge, address, and 

compensate for those long-term risks. 

FEMA Response: FEMA is revising the 

purpose of the regulation in § 296.1 to 

incorporate language to address this 

issue. By changing the current 

regulatory text addressing the 

compensable injuries from ‘‘suffered 

from’’ to ‘‘resulting from’’ the Fire, this 

change addresses the commenters’ 

concerns with whether flood damage is 

an allowable damage. Further, the 

definition of ‘‘injured person’’ includes 

injuries ‘‘resulting from the Hermit’s 

Peak/Calf Canyon Fire’’ and is broad 

enough to encompass flooding as well 

as other types of injuries that may be 

considered to be resulting from the Fire. 

6. Comments on Personal Injury 

Damages 

Comment: Commenters suggested that 

FEMA clarify that personal injury is an 

allowable damage. 

FEMA Response: Section 296.21(a) 

allows for payment of actual 

compensatory damages for injury and 

‘‘injury’’ is defined in § 296.4 to include 

personal injury. All potential claimants 

are encouraged to submit a Notice of 

Loss to enable the Claims Office to 

evaluate individual claims. The Claims 

Office will work with claimants to 

identify eligible economic losses, which 

could include compensation for 

economic losses associated with 

personal injury such as medical bills, 

on-going therapy, and the like and to 

properly value claims. 

Comment: One commenter suggested 

that FEMA provide compensation for 

health issues for residents and animals 

affected by compromised water and air 

quality issues. 

FEMA Response: FEMA agrees these 

types of damages are generally 

compensable under the Act as personal 

injury damages and damage to property. 

These health issues, if resulting from the 

Fire, could be considered injuries under 

the Act’s definition and compensable as 

such. 


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39 2011 N.M. App. Unpub. LEXIS 276 (2011). 

40The commenter wrote ‘‘Subpart C Section 

296.21(b) Excludes reimbursement for attorney’s 

fees and agents’ fees, plus claimant’s cost of 

prosecuting a claim. This should stay. We want all 

of the money to go to the people injured in any way 

by the Hermit’s Peak/Calf Canyon Fire.’’ 

41Animal Legal Defense Fund v. USDA, 789 F.3d 

1206 (11th Cir. 2015), citing In re Haas, 48 F.3d 

1153, 1156 (11th Cir. 1995), abrogated on other 

grounds by In re Griffith, 206 F.3d 1389 (11th Cir. 

2000). See also United States v. Roof, 10 F.4th 314 

(4th Cir. 2021), citing Discover Bank v. Vaden, 396 

F.3d 366, 370 (4th Cir. 2005). 

42 3 U.S. (3 Dall.) 306 (1796). See also Peter v. 

NantKwest, Inc., 140 S.Ct. 365 (2019), Hardt v. 

Reliance Standard Life Insurance Co., 560 U.S. 242 

(2010), Ruckelshaus v. Sierra Club, 463 U.S. 680 

(1983), and Summit Valley Industries, Inc. v. 

Carpenters, 456 U.S. 717 (1982). 

43Animal Legal Defense Fund v. USDA, 789 F.3d 

1206 (11th Cir. 2015), citing In re Haas, 48 F.3d 

1153, 1156 (11th Cir. 1995), abrogated on other 

grounds by In re Griffith, 206 F.3d 1389 (11th Cir. 

2000). See also United States v. Roof, 10 F.4th 314 

(4th Cir. 2021), citing Discover Bank v. Vaden, 396 

F.3d 366, 370 (4th Cir. 2005). 

7. Comments on Calculation of Damages 

Comment: One commenter noted that 

the legal precedent in New Mexico does 

not require claimants to adhere to a 

strict formula to calculate damages. 

Another commenter agreed, citing to 

Maestas v. Medina.39 A different 

commenter asked which New Mexico 

laws were being used to calculate 

damages. 

FEMA Response: In paragraph 

296.21(a) FEMA states, consistent with 

the Act, that the agency will apply New 

Mexico law to the calculation of 

damages. The Claims Office will work 

with claimants to identify an 

appropriate measure of damages 

consistent with applicable law. 

8. Comments on Reasonable Damages 

Comment: Finally, commenters 

discussed the requirement that damages 

must be reasonable in amount in the 

IFR. Some commenters suggested that 

FEMA delete the requirement that 

damages must be reasonable in amount 

while others recommended it be 

changed to actual damages supported. 

One commenter stated that FEMA 

should give claimants the autonomy to 

define reasonableness for themselves. 

FEMA Response: The Act limits 

compensation to actual damages 

incurred by the claimant. To better 

ensure that the claimant is only being 

compensated for the actual damages 

incurred and that claimant is not being 

compensated in amounts that exceed 

the actual damages incurred, FEMA 

requires that the damages be reasonable 

in amount. 

G. Comments on § 296.21(b) Exclusions 

1. Comments on Punitive Damages 

Comment: Two commenters suggested 

claimants be allowed to seek punitive 

damages. 

FEMA Response: Section 

104(c)(3)(B)(ii) of the Act specifically 

excludes punitive damages from the 

compensation available under the Act. It 

is thus beyond FEMA’s statutory 

authority to compensate for these 

damages. 

2. Comments on Criminality 

Comment: One commenter wrote 

‘‘Essentially, the USFS committed a 

crime when—against all experienceinformed protests from local citizens— 

its agents (the district ranger, burn boss 

and all commanding managers above 

them) made the decision to begin the 

Dispensas Prescribed Burn which 

rapidly and irreversibly exploded into 

the catastrophe now known as the 

Hermit’s Peak Fire. They also 

committed a crime of negligence when 

they failed to properly monitor burn 

piles which reignited and caused the 

Calf Canyon Fire which merged with the 

Hermit’s Peak Fire to cause widespread 

devastation now wreaking havoc for 

victims of the fire.’’ 

FEMA Response: FEMA is not 

authorized under the Act to pursue 

these types of claims. In the Act, the 

United States accepted responsibility for 

damage resulting from the Fire and 

waived sovereign immunity to 

compensate victims in tort. By 

excluding punitive damages, the Act 

makes clear that damages for intentional 

and other behavior otherwise giving rise 

to heightened liability are not 

compensable. FEMA is not revising the 

Final Rule. 

3. Comments on Attorneys’ and Agents’ 

Fees 

While one commenter specifically 

expressed support for this provision,40 a 

large number of commenters wrote that 

FEMA should pay attorneys’ and agents’ 

fees associated with the claims process. 

Comment: One commenter wrote that 

the Administrator had the discretion to 

pay legal fees under the Act because the 

Act allows the award of financial losses 

of ‘‘any other loss that the Administrator 

determines to be appropriate for 

inclusion as financial loss.’’ The 

commenter stated that claimants using 

lawyers are likely to have more 

complete and better documented claims 

and that FEMA should want and 

encourage claimants to have complete 

and well documented claims. The 

commenter also noted that if claimants 

pay the financial expense of a lawyer 

the victims will not be made 100 

percent whole unless they recover both 

100 percent of losses and 20 percent for 

legal fees. A different commenter also 

stated that FEMA should encourage the 

efficiency and assistance that will result 

from allowing claimants to obtain 

attorney assistance and be made whole 

by allowing claimants to recover their 

attorney’s fees. 

FEMA Response: The Act is silent 

regarding FEMA’s authority to pay 

attorney or agent fees. Generally, if 

Congress knows how to say something 

but chooses not to, its silence is 

controlling.41 While the Act places 

limits on the amount an attorney or 

agent may charge in section 104(j)(1), 

the Act does not provide for attorney or 

agent fees as allowable damages. 

Further, the ‘‘American Rule,’’ generally 

applicable in civil litigation and 

accepted by the United States Supreme 

Court initially in the case of Arcambel 

v. Wiseman,42 provides that in the 

absence of a statute indicating 

otherwise, each party is responsible for 

paying their own attorney fees. FEMA 

designed the claims process so that 

claimants will receive all eligible 

compensation without the need to 

engage the services of an attorney, and 

the Claims Office hired Claims 

Navigators to assist claimants compiling 

necessary documentation and with the 

Proof of Loss. Although claimants have 

the right to hire an attorney, one is not 

required. 

Comment: A commenter wrote ‘‘The 

Fire Victim Trust in California added 

legal fees to gross economic awards, and 

it has been a tremendous benefit as 

around 90 [percent] of claimants hired 

lawyers.’’ 

FEMA Response: As noted, the Act is 

silent regarding FEMA’s authority to 

pay attorney or agent fees. Generally, if 

Congress knows how to say something 

but chooses not to, its silence is 

controlling.43 While the Act places 

limits on the amount an attorney or 

agent may charge in section 104(j)(1), 

the Act does not provide for attorney or 

agent fees as allowable damages. FEMA 

is applying the generally accepted 

American Rule for attorney fees. FEMA 

designed the claims process so that 

claimants will receive all eligible 

compensation without the need to 

engage the services of an attorney, and 

the Claims Office hired Claims 

Navigators to assist claimants compiling 

necessary documentation and with the 

Proof of Loss. Although claimants have 

the right to hire an attorney, one is not 

required. Also as noted, the Fire Victim 

Trust in California involved a private 

party defendant under the oversight of 

a bankruptcy court applying California 

law and does not present a useful 


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44Animal Legal Defense Fund v. USDA, 789 F.3d 

1206 (11th Cir. 2015), citing In re Haas, 48 F.3d 

1153, 1156 (11th Cir. 1995), abrogated on other 

grounds by In re Griffith, 206 F.3d 1389 (11th Cir. 

2000). See also United States v. Roof, 10 F.4th 314 

(4th Cir. 2021), citing Discover Bank v. Vaden, 396 

F.3d 366, 370 (4th Cir. 2005). 

45E.g., Anderson v. United States, 127 F.3d 1190, 

1191 (9th Cir. 1997) (‘‘The FTCA does not contain 

an express waiver of sovereign immunity for 

attorneys’ fees and expenses.’’); Joe v. United States, 

772 F.2d 1535 (11th Cir. 1985). 

46Animal Legal Defense Fund v. USDA, 789 F.3d 

1206 (11th Cir. 2015), citing In re Haas, 48 F.3d 

1153, 1156 (11th Cir. 1995), abrogated on other 

grounds by In re Griffith, 206 F.3d 1389 (11th Cir. 

2000). See also United States v. Roof, 10 F.4th 314 

(4th Cir. 2021), citing Discover Bank v. Vaden, 396 

F.3d 366, 370 (4th Cir. 2005). 

47 3 U.S. (3 Dall.) 306 (1796). See also Peter v. 

NantKwest, Inc., 140 S.Ct. 365 (2019), Hardt v. 

Reliance Standard Life Insurance Co., 560 U.S. 242 

(2010), Ruckelshaus v. Sierra Club, 463 U.S. 680 

(1983), and Summit Valley Industries, Inc. v. 

Carpenters, 456 U.S. 717 (1982). 

paradigm for the Hermit’s Peak/Calf 

Canyon Fire. 

Comment: A commenter wrote that 

Congress only prevented the award of 

punitive damages and interest in the 

Act, not the award of legal fees. 

FEMA Response: As noted, the Act is 

silent regarding FEMA’s authority to 

pay attorney or agent fees. Generally, if 

Congress knows how to say something 

but chooses not to, its silence is 

controlling.44 While the Act places 

limits on the amount an attorney or 

agent may charge in section 104(j)(1), 

the Act does not provide for attorney or 

agent fees as allowable damages. FEMA 

is applying the generally accepted 

American Rule for attorney fees. FEMA 

designed the claims process so that 

claimants will receive all eligible 

compensation without the need to 

engage the services of an attorney, and 

the Claims Office hired Claims 

Navigators to assist claimants compiling 

necessary documentation and with the 

Proof of Loss. Also as noted, the Act is 

a limited waiver of sovereign immunity, 

and similar to cases decided under the 

Federal Tort Claims Act,45 the Act does 

not waive sovereign immunity to allow 

payment of attorney fees. 

Comment: Several commenters stated 

the process was too complicated and 

required professional and/or legal 

assistance to navigate and that payment 

of these fees would help to make them 

whole. 

FEMA Response: One purpose of the 

Act is to provide for expeditious 

consideration and settlement of claims 

from the Fire. The Claims Office 

interprets this to require an approach to 

settling claims that claimants can 

complete without engaging the services 

of attorneys or other professionals. To 

achieve this goal, FEMA hired a number 

of Claims Navigators from the local 

community, trained these Claims 

Navigators to identify compensable 

losses and to understand what is needed 

to complete a Proof of Loss, and 

developed a Claims Office ethos that 

emphasizes the needs of the claimant. 

The Claims Navigators work with 

claimants to ensure that they develop 

the information needed to receive 

compensation for all eligible losses. The 

Claims Office recognizes that some 

claims will require special expertise and 

will pay for experts that are needed to 

value particular claims. FEMA also 

notes that at the time the comment was 

submitted, the Claims Office had not yet 

fully developed the claims procedures, 

so it is understandable that the 

commenters did not recognize that the 

process is designed so that claimants do 

not need legal assistance. 

Comment: One commenter wrote that 

the Act recognized that claimants may 

seek legal assistance and capped those 

fees at 20 percent. The commenter 

stated that a FEMA representative, 

‘‘protected by sovereign immunity, with 

no legal, ethical, or fiduciary obligation 

to the claimant, will be advising the 

claimant on the strategy to meet their 

burden of proof to obtain make-whole 

damages allowed by the language of the 

HPFAA and New Mexico State law. 

This approach puts claimants in the 

hands of FEMA representatives who 

have a conflict of interest. That is 

simply improper, unfair, unduly 

harmful to claimants, and places an 

administrative burden on FEMA and its 

representatives that otherwise would be 

borne by the claimant’s attorneys.’’ This 

commenter also stated that the claims 

process required claimants to make 

decisions with legal implications and 

that FEMA employees and contractors 

would be able to obtain legal advice and 

assistance from their counsel in the 

process. The commenter stated that 

FEMA’s legal team would be paid from 

Act’s funds as an administrative 

expense and that claimants’ attorneys’ 

fees should be as well. The commenter 

also added that if represented by 

attorneys, FEMA should pay those 

funds directly to the attorneys for 

proper handling and lien resolution 

through authorized IOLTA trust 

accounts stating that claimants would 

have lien obligations that must be 

satisfied out of the compensation 

received, whether to satisfy fees, 

mortgages, medical liens, or other liens. 

FEMA Response: As with the Cerro 

Grande Act, in this Act, Congress limits 

attorney fees that an attorney is able to 

charge given it has established a claims 

process statutorily mandating the 

expeditious provision of compensation 

to all injured persons. FEMA designed 

the program to help claimants navigate 

the process. The Claims Office is 

implementing measures to eliminate 

potential conflicts of interest, and 

otherwise the Claims Office has no 

incentive not to pay claimants for all 

eligible losses. The Act creates the 

Claims Office and instructs the Director 

of the Claims Office, other officials, and 

staff to fully compensate claimants 

applying the authorizations and 

limitations in the law. The Director, 

other officials, and staff have a legal 

duty to pay eligible claimants the full 

amount of proven claims. Third, the 

assignment of benefits prohibition in the 

regulations. 

Comment: One commenter stated that 

attorneys’ fees should be covered to 

help with the claims process for those 

especially that are elderly, handicapped, 

or those with basic literacy skills that 

don’t have the ability to file the claims 

process themselves, that ‘‘the attorneys’ 

fees should not come out of the final 

claim; that should be added on top of 

it.’’ 

FEMA Response: As discussed above, 

the Act is silent regarding FEMA’s 

authority to pay attorney or agent fees. 

Generally, if Congress knows how to say 

something but chooses not to, its silence 

is controlling.46 While the Act places 

limits on the amount an attorney or 

agent may charge in section 104(j)(1), 

the Act does not provide for attorney or 

agent fees as allowable damages. 

Further, the ‘‘American Rule,’’ generally 

applicable in civil litigation and 

initially accepted by the United States 

Supreme Court in the case of Arcambel 

v. Wiseman,47 provides that in the 

absence of a statute indicating 

otherwise, each party is responsible for 

paying their own attorney fees. FEMA 

designed the claims process so that 

claimants will receive all eligible 

compensation without the need to 

engage the services of an attorney, and 

the Claims Office hired Claims 

Navigators to assist claimants compiling 

necessary documentation and with the 

Proof of Loss. Although claimants have 

the right to hire an attorney, one is not 

required. Also, the State of New Mexico 

has identified several programs 

providing free legal representation for 

individuals affected by the Fire. 

Comment: One commenter stated that 

attorneys’ fees and consultant fees need 

to be paid out of the Act’s funding if the 

fees to administer the program would be 

paid out of the Act’s funding. 

FEMA Response: As explained above, 

section 104(a)(2)(C)(i) requires FEMA to 

use the funding made available under 

the Act to fund the Claims Office. FEMA 

is required to follow the Act’s 


ddrumheller on DSK120RN23PROD with RULES4
59748 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

48Animal Legal Defense Fund v. USDA, 789 F.3d 

1206 (11th Cir. 2015), citing In re Haas, 48 F.3d 

1153, 1156 (11th Cir. 1995), abrogated on other 

grounds by In re Griffith, 206 F.3d 1389 (11th Cir. 

2000). See also United States v. Roof, 10 F.4th 314 

(4th Cir. 2021), citing Discover Bank v. Vaden, 396 

F.3d 366, 370 (4th Cir. 2005). 

49 3 U.S. (3 Dall.) 306 (1796). See also Peter v. 

NantKwest, Inc., 140 S.Ct. 365 (2019), Hardt v. 

Reliance Standard Life Insurance Co., 560 U.S. 242 

(2010), Ruckelshaus v. Sierra Club, 463 U.S. 680 

(1983), and Summit Valley Industries, Inc. v. 

Carpenters, 456 U.S. 717 (1982). 

requirement to fund the Claims Office 

from the Act’s funding. Additionally, as 

discussed above, the Act is silent 

regarding FEMA’s authority to pay 

attorney or agent fees. Generally, if 

Congress knows how to say something 

but chooses not to, its silence is 

controlling.48 While the Act places 

limits on the amount an attorney or 

agent may charge in section 104(j)(1), 

the Act does not provide for attorney or 

agent fees as allowable damages. 

Further, the ‘‘American Rule,’’ generally 

applicable in civil litigation and 

initially accepted by the United States 

Supreme Court in the case of Arcambel 

v. Wiseman,49 provides that in the 

absence of a statute indicating 

otherwise, each party is responsible for 

paying their own attorney fees. FEMA 

designed the claims process so that 

claimants will receive all eligible 

compensation without the need to 

engage the services of an attorney, and 

the Claims Office hired Claims 

Navigators to assist claimants compiling 

necessary documentation and with the 

Proof of Loss. Although claimants have 

the right to hire an attorney, one is not 

required. 

Comment: Some commenters stated 

that the funding provided under the Act 

was not sufficient to pay the claims and 

attorneys’ and agents’ fees. 

FEMA Response: FEMA is also 

concerned about the use of funds under 

the Act to pay attorneys’ fees. As 

explained above, FEMA is committed to 

hiring staff and providing resources to 

assist all claimants with their claims. 

While claimants can seek counsel on 

their own, the claims process, as 

structured, will provide claimants with 

the assistance needed to prepare and 

submit their claims effectively. 

Comment: A commenter requested 

consistency in awards for damage, 

asking if FEMA would treat all 

claimants equitably whether the 

claimant chose to represent themselves 

and hired an attorney to handle their 

claim. 

FEMA Response: FEMA understands 

the commenter’s concern but reiterates 

that the agency is bound to act in a fair 

manner with all claimants, regardless of 

representation. FEMA is committed to 

hiring staff and providing resources to 

assist all claimants with their claims. 

While claimants can seek counsel on 

their own, the claims process, as 

structured, will provide claimants with 

the assistance needed to prepare and 

submit their claims effectively. 

4. Comments on the Cost of Prosecuting 

a Claim 

Comment: Several commenters sought 

to remove this exclusion from damages. 

One commenter wrote ‘‘Absolutely 

every second of time spent on every 

action required of victims for them to 

receive compensations from the 

Hermit’s Peak Fire Assistance Act must 

be covered as recoverable expense since 

this situation has been foisted upon 

victims against their will and through 

no fault of their own. This must be the 

case no matter the severity level of 

injury suffered by victims because this 

entire ordeal is both time consuming 

and stressful as it drags on to full 

conclusion.’’ A different commenter 

wrote ‘‘Time spent in claims 

preparation is not considered a damage. 

The time required for processing this 

claim is extensive. Loss of my time is a 

loss of that part of my life, and it should 

be considered valuable.’’ 

FEMA Response: FEMA provides 

claimants with the ability to recover the 

reasonable costs incurred in providing 

documentation requested by the Claims 

Office pursuant to § 296.31(a) and 

incidental expenses pursuant to 

§ 296.31(b). However, time spent in the 

prosecution of a claim is not considered 

an actual compensatory damage. Section 

104(c)(3)(A) of the Act requires FEMA to 

reimburse claimants only for actual 

compensatory damages. FEMA cannot 

reimburse claimants for time spent 

working on their claims as such 

reimbursement is beyond the agency’s 

statutory authority. 

Comment: One commenter wrote that 

because the Act authorizes 

compensation for ‘any other loss that 

the Administrator determines to be 

appropriate for inclusion,’ FEMA can 

allow the cost of prosecuting a claim to 

be recoverable. 

FEMA Response: As explained in the 

IFR, compensatory damages for time 

spent in claims preparation or 

prosecuting a claim are not available 

under New Mexico law or the Federal 

Tort Claims Act. Moreover, there is no 

evidence Congress intended that 

claimants be compensated for the value 

of their time in preparing a claim. As 

explained in the IFR, FEMA is choosing 

to exercise discretion to provide a lump 

sum payment to claimants for 

miscellaneous and incidental expenses 

incurred in the claims process. FEMA 

will provide a lump sum payment of 

five percent of the insured and 

uninsured loss (excluding flood 

insurance premiums), not to exceed 

$25,000. The minimum lump sum 

payment is $150. Section 296.31(b) of 

the IFR represents a fair and reasonable 

accommodation between the agency’s 

responsibility to spend Federal funds 

wisely and the desire to compensate 

claimants as fully as possible. 

Providing compensation for a 

claimant’s time would be difficult to 

administer, as FEMA would have to 

determine equitably the value of a 

claimant’s time and to verify that 

claimants have expended the number of 

hours that are claimed. FEMA’s 

payments under the Act are subject to 

independent audit by the GAO and the 

DHS OIG and claimants would likely 

find attempts by auditors to verify the 

payment for hours spent in the claims 

process highly intrusive. Additionally, 

the type of compensation requested by 

commenters here would require 

production of receipts and other 

documentation, resulting in an overly 

burdensome process for this payment to 

claimants contrary to other comments 

requesting the agency streamline and 

simplify the claims process. 

H. Comments on § 296.21(c) Loss of 

Property 

Comment: One comment stated flood 

damage should be specifically added to 

this section. Several other commenters 

suggested an addition to this paragraph 

to allow for other losses including 

anticipated future damages from 

flooding through November 14, 2032. 

These commenters noted that it could 

be up to ten years before conditions 

stabilize in the impacted forests and 

watersheds and that the Act’s language 

indicates that post-fire flooding injuries 

should be considered as actual 

compensatory damages. 

FEMA Response: As explained above, 

FEMA is revising § 296.1 of the Final 

Rule to clarify that claimants may seek 

compensatory damages for injuries 

resulting from the Fire. This language is 

broad enough to encompass a range of 

injuries resulting from the Fire, 

including flood damages. Additionally, 

the definition of ‘‘injured person’’ 

includes injuries ‘‘resulting from the 

Hermit’s Peak/Calf Canyon Fire’’ and is 

broad enough to encompass flooding, 

mudflow, mold, and debris flow as well 

as other types of injuries that may be 

considered to be resulting from the Fire. 

FEMA does not believe additional edits 

to this section of the regulation are 

required as a result. Further, FEMA is 

unable to extend the deadline for claims 

submission requested by the 


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commenters. As previously explained, 

some deadlines in the rule are beyond 

FEMA’s control and authority to change. 

Section 104(b) of the Act requires 

claimants submit their Notice of Loss no 

later than November 14, 2024, two years 

from the date the IFR is promulgated. 

FEMA has built in extensions of this 

timeline for good cause, recognizing the 

realities of the Fire’s impact. Sections 

296.34 and 296.35 below establish a 

process for notifying FEMA of injuries 

that are not referenced in the initial 

Notice of Loss. Whether a claimant tells 

FEMA about an injury in the initial 

Notice of Loss or an amendment under 

§ 296.34, FEMA must know about the 

injury by November 14, 2024. For 

heightened risk reduction efforts, a 

claimant must include the claim in their 

Notice of Loss by November 14, 2024, or 

an amended Notice of Loss filed no later 

than November 14, 2025. See 

§ 296.21(c)(5). Additionally, FEMA 

recognizes the potential long-term 

impacts of flooding after fire and will 

encourage claimants to consider risk 

reduction measures to address those 

risks. 

1. Comments on § 296.21(c)(1) Real 

Property and Contents 

Comment: Several commenters wrote 

about how FEMA would value real 

property and contents when analyzing 

claims under the Act. Most of these 

commenters suggested FEMA consider 

the actual costs to rebuild and construct 

in the future, acknowledging increasing 

market values of land, construction, and 

other costs such as inflation. with some 

commenters stating that it may not be 

safe to immediately rebuild. 

FEMA Response: The language in the 

IFR addresses these concerns as it 

explains the costs of reconstruction 

must factor in post-Fire construction 

costs as well as current building codes 

at the time of construction. FEMA will 

work with claimants to ensure that 

compensation effectively addresses 

future construction cost concerns and 

compensation for any decrease in the 

value of the land on which the structure 

sat as detailed in § 296.21(c)(1). FEMA 

is not making any changes to this 

section of the Final Rule. 

Comment: Some commenters stated 

that it may not be safe to immediately 

rebuild. One commenter wrote 

claimants face decades of uncertainty 

regarding terrain stability and that 

‘‘such areas are now extremely high-risk 

hazard zones.’’ 

FEMA Response: FEMA understands 

concerns about rebuilding immediately 

after the Fire and will work with 

claimants to ensure that compensation 

effectively addresses concerns regarding 

stabilizing the land and for any decrease 

in the value of the land on which the 

structure sat as detailed in 

§ 296.21(c)(1). The current text in the 

IFR is sufficient to address this concern 

and is not making any changes to this 

section of the Final Rule. 

Comment: Commenters raised 

questions regarding compensation for 

other damages beyond home 

reconstruction. Some commenters 

suggested FEMA consider the intrinsic 

value of the property lost, as well as loss 

of use damages and compensation for 

future potential land use. Commenters 

suggested that damages be calculated 

based on replacement and/or intrinsic 

value—not fair market value. Other 

commenters wrote requesting 

compensation for lost sentimental value 

for damaged real and personal property 

and the loss of use of personal or real 

property. 

FEMA Response: Generally, FEMA’s 

calculation of damages, including how 

damaged property is valued, will be 

governed by the Act and Federal law. To 

the extent that this valuation is not preempted by Federal law, New Mexico 

law will govern. 

Comment: Some commenters 

suggested payment of double 

compensatory damages for trespass 

under New Mexico Statutes Annotated 

section 30–14–1.1. 

FEMA Response: As noted, the Act 

does not provide for punitive or noneconomic damages, including noneconomic damages for nuisance and 

trespass. Economic damages associated 

with nuisance and trespass are available 

upon proper proof. However, because 

the Act limits recovery to actual 

damages, double compensation would 

not be available. 

Comment: Two commenters suggested 

FEMA compensate for property taxes, 

either to the local government or 

individual property owners. 

FEMA Response: The Claims Office 

compensates claimants for actual 

damages resulting from the Fire. Any 

increases in property tax or any 

decreases in property tax revenue 

income, if resulting from the Fire, 

would be compensable under the IFR. 

Comment: One commenter asked how 

losses for wells, water, and erosion 

would be compensated. 

FEMA Response: While the IFR 

addresses erosion, FEMA is adding 

paragraph (c)(5) to § 296.21 of the Final 

Rule specifically address damages for 

physical infrastructure including 

irrigation infrastructure such as acequia 

systems. This change in the Final Rule 

can also encompass concerns raised 

regarding well and water losses to the 

extent those losses are of physical 

infrastructure. Those losses may also be 

considered part of real property and 

contents losses in § 296.21(c)(1). 

Comment: One commenter suggested 

FEMA find ways to compensate people 

that work a land grant, as those 

claimants would not have deeds to the 

property and figure out ways to get them 

documentation to support their claims. 

FEMA Response: The IFR language 

sufficiently addresses these 

commenters’ concerns. Specifically, 

FEMA defines ‘‘injured person’’ in 

§ 296.4 to include individuals, 

businesses, Indian Tribes, State and 

local government entities, and ‘‘other 

non-Federal entit(ies).’’ This broad 

definition currently encompasses all 

potential claims associated with land 

grants as a result. As explained above, 

the Claims Office locally hired 

Navigators to assist claimants compiling 

necessary documentation and 

completing the Proof of Loss in support 

of the claim. Claims Navigators and 

Claims Reviewers will work with each 

claimant to ensure that they are able to 

get the proper documentation to 

complete their claim and will use 

alternative methods to prove ownership 

when the deed is not available, such as 

affidavits, utility bills, and tax records. 

Comment: One commenter inquired 

as to whether or not their vehicle and 

newly published book would be covered 

under the regulation. 

FEMA Response: Section 296.21(c)(1) 

of the IFR explains that claimants can 

seek compensation for the contents of 

real property damaged by the Fire. The 

commenter’s personal property 

mentioned is covered by the current 

language and no changes to the 

regulatory text is required for the Final 

Rule. 

Comment: Several commenters 

focused on the issue of compensation 

for debris removal under this paragraph. 

Commenters generally sought 

clarification on what compensation was 

available. Commenters sought wages as 

compensation for debris removal efforts 

they complete because of the lack of 

available contractors in the area. One 

commenter stated ‘‘there is so much 

devastation, the cleanup part of the 

reimbursement is going to fall mainly on 

the landowner because there [are] not 

enough contractors or help out there to 

do this much clean up. And so, in order 

to do that, the landowners are going to 

need to pay themselves for their time 

and equipment that they use and need 

to cleanup a massive amount of trees. 

And so, I would hope that part of the 

compensation for the debris removal 

and reforestation is, would include 

wages for the landowners or their 


ddrumheller on DSK120RN23PROD with RULES4
59750 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

50Section 296.21(e)(1) provides for compensation 

under the Act for interest paid on loans for damages 

resulting from the Fire as well as proceeds from the 

compensation award to repay any SBA loans 

obtained. 

51For information on the criteria for participation 

in the Individual Assistance Program please see the 

Individual Assistance Program and Policy Guide, 

Version 1.1 found at https://www.fema.gov/sites/ 

default/files/documents/fema_iappg-1.1.pdf (last 

accessed Feb. 24, 2023). 

52Section 296.21(e)(1) provides for compensation 

under the Act for interest paid on loans for damages 

resulting from the Fire as well as proceeds from the 

compensation award to repay any SBA loans 

obtained. 

53For information on the criteria for participation 

in the Individual Assistance Program please see the 

Individual Assistance Program and Policy Guide, 

Version 1.1 found at https://www.fema.gov/sites/ 

default/files/documents/fema_iappg-1.1.pdf (last 

accessed Feb. 24, 2023). 

friends or whoever to pay to get it 

done.’’ 

FEMA Response: Claimants seeking 

compensation for their own work or the 

work of those they hire to remove debris 

can claim this expense under 

§ 296.21(c)(1). FEMA does not believe 

further edits to the regulatory text are 

required for claimants to seek this 

compensation. 

Comment: Commenters questioned 

the extent to which adjacent property 

owners could be held responsible for 

debris flow traced to their property. 

FEMA Response: FEMA recognizes 

that not every property owner will file 

a claim or seek to restore their property 

and FEMA cannot require property 

owners to do so. Claimants seeking to 

promote recovery of their properties can 

file a claim under this paragraph. Also, 

the Act does not authorize FEMA to 

pursue liability against third parties 

who may be responsible for damage. 

Comment: Other commenters raised 

concerns about current debris removal 

efforts. A commenter stated that trees 

being removed for right of way created 

stumps that were too high and 

dangerous and a lack of inspections on 

the work performed. The commenter 

stated a general lack of progress on 

debris removal and how a lack of 

fencing resulted in animals in the road, 

presenting a danger to commuters in the 

area. 

FEMA Response: FEMA understands 

the challenges associated with debris 

removal after a wildfire and subsequent 

flooding. This paragraph of the IFR 

provides claimants the ability to receive 

compensation for removing debris and 

burned trees. As noted, FEMA and other 

Federal and State agencies have a 

number of programs that provided 

assistance after the Fire and had 

responsibilities for debris removal. The 

Claims Office provides compensation 

for damages resulting from the Fire, 

including debris removal, and is not 

responsible for debris removal and other 

post-disaster activities undertaken by 

other Federal and State agencies. 

Comment: Finally, some commenters 

sought clarification on prioritization of 

claimants with respect to this 

paragraph. Commenters generally 

suggested that FEMA focus first on 

those who lost their homes, including 

mobile homes, and do everything 

possible to make them whole. 

FEMA Response: FEMA intends to 

prioritize individual claimants over 

subrogees consistent with the Act’s 

mandate at section 104(d)(1)(A)(ii). 

FEMA understands the unique 

challenges presented for those that lost 

their homes in the Fire and agrees that 

those claims require immediate 

attention. FEMA will work to ensure 

that all claims are reviewed in an 

expeditious and fair manner. 

Comment: A commenter raised 

concerns about FEMA assistance 

through the Individual Assistance 

Program related to SBA loans, stating 

that an SBA loan would not make 

claimants whole. 

FEMA Response: Under the Act, this 

commenter has the option of filing a 

claim to be compensated for these 

damages if the assistance provided 

under the Individual Assistance 

Program was insufficient to fully 

compensate them.50 FEMA notes that 

the Individual Assistance Program has 

specific criteria for assistance,51

including requirements regarding 

pursuing a loan with the Small Business 

Administration, that are not found in 

the Act. FEMA encourages claimants to 

seek compensation for actual 

compensatory damages for injuries 

resulting from the Fire and as explained 

above, the Act can provide 

compensation if the assistance provided 

under the Individual Assistance 

Program was insufficient to fully 

compensate claimants. Notably, Small 

Business Administration loans, and the 

interest accrued on these loans, is 

compensable under the Act. 

Comment: One commenter asked if 

the Act would compensate for looting 

that occurred on their property after the 

Fire, stating they were denied assistance 

under the Individual Assistance 

Program. 

FEMA Response: Under the Act, this 

commenter has the option of filing a 

claim to be compensated for these 

damages if the assistance provided 

under the Individual Assistance 

Program was insufficient to fully 

compensate them.52 FEMA notes that 

the Individual Assistance Program has 

specific criteria for assistance.53 FEMA 

encourages claimants to seek 

compensation for actual compensatory 

damages for injuries resulting from the 

Fire and as explained above, the Act can 

provide compensation for damage from 

the Fire if the assistance provided under 

the Individual Assistance Program was 

insufficient to fully compensate them. 

2. Comments on § 296.21(c)(2) 

Reforestation and Revegetation 

Comment: Most commenters opposed 

the formula to pay 25 percent of the preFire value of the lot and structures as 

compensation for reforestation and 

revegetation. Commenters stated 75 

percent less value was unacceptable 

when there were large parcels of land 

previously forested before the Fire and 

recommended FEMA delete the 25 

percent cap on reforestation damages, 

with several commenters stating the 25 

percent limit violated New Mexico law. 

One commenter wrote ‘‘For landowners 

that have more than 100 acres, this is a 

tremendous financial burden when they 

need to come up with 75 [percent]. The 

compensation needs to be changed from 

25 [percent] to a greater extent to cover 

losses from fire, erosion, creeks and 

water ways, meadows, deep canyons, 

pine trees, oak brush, and trees.’’ A 

different commenter wrote ‘‘Generations 

of stakeholders have provided a free 

ecological service maintaining the lands 

that make up the watersheds that 

provide clean water for millions 

downstream. This includes best 

practices for farming and forestry. 

Restoring the forests and planting new 

trees is essential for regenerating a 

healthy ecosystem, and repairing the 

harm done by the US government. 

Providing 100 [percent] of costs for loss 

will ensure that future generations have 

a better chance to develop this unique 

rural/mountain economy.’’ 

FEMA Response: In the IFR, FEMA 

limited compensation for trees and 

other landscaping to 25 percent of the 

pre-Fire value of the structure and lot. 

This approach was generally consistent 

with the approach taken in the Cerro 

Grande Fire Assistance process. As 

explained in the IFR, the 25 percent 

limitation does not apply to business 

losses for timber, crops, and other 

natural resources under § 296.21(d). In 

response to commenter concerns and 

confusion regarding the application of 

this formula, FEMA is revising this 

paragraph in the Final Rule to eliminate 

references to the 25 percent formula. 

FEMA understands that the land 

impacted by this Fire was more heavily 

forested than the Cerro Grande Fire and 

that those resources were relied on for 

personal, subsistence, and business 

needs, making the formula in this 

section of the IFR particularly 

confusing. The Final Rule allows for 


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compensatory damages for the cost of 

replacement of destroyed trees and 

other landscaping and removes 

references to the 25 percent formula. 

Comment: Several commenters 

opposed to this paragraph stated the 

distinctions between the Cerro Grande 

Fire and Hermit’s Peak/Calf Canyon Fire 

communities necessitated a different 

valuation analysis for the claims 

process. One commenter wrote 

‘‘Landowners of Mora and San Miguel 

are usually on many acres of land (some 

have been passed down through 

generations), whereas Cerro Grande 

were on smaller lots. 75 [percent] less 

value is unacceptable when you have a 

large parcel of land that was previously 

forested.’’ Another commenter wrote 

‘‘This approach was used in the Cerro 

Grande Fire Assistance Process in Los 

Alamos, New Mexico of which is one of 

the wealthiest counties per capita in the 

nation. I suspect the structures and land 

parcels are of higher value in Los 

Alamos versus Mora, New Mexico based 

on property assessments. It is suggested 

to reconsider the formula because 

properties in Mora would receive less 

compensation for similar damage from 

the wildfire versus Los Alamos.’’ A 

commenter wrote ‘‘Unlike properties in 

Los Alamos that were damaged by the 

Cerro Grande Fire and upon which this 

interim rule is based, many of the 

properties damaged by the Hermit’s 

Peak and Calf Canyon Fires consist of 

hundreds of tree-covered acres, not 

small, landscaped lots. New Mexico has 

a long history of subsistence use of 

forests and trees that should be 

recognized by this rule.’’ 

FEMA Response: As explained above, 

FEMA appreciates the insights provided 

by commenters on the distinctions 

between the areas impacted by the Cerro 

Grande Fire and the Hermit’s Peak/Calf 

Canyon Fire. These differences are 

important to recognize, and FEMA 

agrees that these differences require 

revision to the IFR where the process 

implemented for the Cerro Grande Fire 

will no longer meet the needs of 

claimants for the Hermit’s Peak/Calf 

Canyon Fire. In response to 

commenters’ concerns, FEMA is 

revising this paragraph in the Final Rule 

to eliminate references to the 25 percent 

formula. As explained above, FEMA 

understands the communities impacted 

by this Fire were less densely populated 

and contained larger areas of privately 

held land. This land was also more 

heavily forested, making the loss of trees 

and vegetation a particularly devastating 

loss for claimants. The Final Rule 

allows for compensatory damages for 

the cost of replacement of destroyed 

trees and other landscaping and 

removes references to the 25 percent 

formula. 

Comment: A commenter wrote that 

the Act did not impose caps on tree or 

mitigation damages and that New 

Mexico law did not have a cap on 

damages to trees or for mitigation, but 

rather that New Mexico law allows 

plaintiffs to recover the full value of any 

trees destroyed on their property. This 

commenter further stated that ‘‘New 

Mexico law allows as compensatory 

damages double the value of tree 

damages. While the Act prohibits 

‘punitive damages’ it does not prohibit 

statutory compensatory damages but 

requires application of New Mexico law 

which includes section 30–14–1.1.’’ 

FEMA Response: In the IFR, FEMA 

limited compensation for trees and 

other landscaping to 25 percent of the 

pre-Fire value of the structure and lot. 

This approach was generally consistent 

with the approach taken in the Cerro 

Grande Fire Assistance process. As 

explained in the IFR, the 25 percent 

limitation does not apply to business 

losses for timber, crops, and other 

natural resources under § 296.21(d). In 

response to commenter concerns and 

confusion regarding the application of 

this formula, FEMA is revising this 

paragraph in the Final Rule to eliminate 

references to the 25 percent formula. 

FEMA understands that the land 

impacted by this Fire was more heavily 

forested than the Cerro Grande Fire and 

that those resources were relied on for 

personal, subsistence, and business 

needs, making the formula in this 

section of the IFR particularly 

confusing. The Final Rule allows for 

compensatory damages for the cost of 

replacement of destroyed trees and 

other landscaping and removes 

references to the 25 percent formula. 

Comment: Commenters asked how the 

valuation used in the formula would be 

made under the formula, with one 

commenter requesting the inclusion of 

intrinsic value to be part of the damage’s 

calculation for real property loss. A 

commenter asked how the 25 percent 

would be quantified and qualified. A 

different commenter requested that 

losses be calculated using replacement 

and/or intrinsic value, not fair market 

value and that these values should 

account for the generational investment 

in the land and forest that was 

destroyed, as well as the loss that will 

be incurred while regrowth takes place. 

FEMA Response: In response to 

commenter concerns and confusion 

regarding the application of this formula 

as explained above, FEMA is revising 

this paragraph in the Final Rule to 

eliminate references to the 25 percent 

formula. The Final Rule allows for 

compensatory damages for the cost of 

replacement of destroyed trees and 

other landscaping. Valuation of losses 

under this revised language will be at 

100 percent of the damage. Generally, 

FEMA’s calculation of damages, 

including how damaged property is 

valued, will be governed by the Act, 

Federal law, and New Mexico law, but 

only to the extent that New Mexico law 

is not pre-empted by Federal law. 

Comment: In lieu of the proposed 

formula, one commenter suggested 

FEMA pay per acre ($10,000 per acre) to 

be used to replant and rebuild loss. 

FEMA Response: FEMA appreciates 

the suggestion for a payment formula 

based on acreage. FEMA attempted to 

streamline the process by offering the 

formula presented in the IFR and 

understands there can be advantages to 

formulas to better assist claimants in 

receiving prompt payment. Given the 

challenges with the specific formula in 

the IFR and the unique concerns of the 

impacted communities because of the 

heavily forested areas and personal, 

subsistence, and business uses of the 

forest and vegetation, FEMA is 

removing the 25 percent formula from 

this section of the regulation. However, 

FEMA is looking at ways to better 

streamline the claims process in 

response to other comments and is 

considering offering payment formulas 

based on acreage such as the one 

suggested by one of the commenters to 

claimants. Any such type of formula 

would provide claimants with the 

option to either leverage that formula 

with their claim or submit 

documentation detailing their specific 

damages. 

Comment: Another commenter stated 

that landowners should be allowed to 

request wages as compensation for 

reforestation efforts on their land 

because of the lack of contractors to 

assist in the area. 

FEMA Response: Claimants seeking 

compensation for their own work or the 

work of those they hire for reforestation 

efforts can claim this expense under this 

paragraph. FEMA does not believe 

further edits to the regulatory text are 

required for claimants to seek this 

compensation. 

Comment: Commenters also 

commented on limiting compensation 

where the costs may be covered by 

another Federal program. Most 

commenters suggested FEMA remove 

this limitation, stating claimants should 

not be required to use other Federal 

programs, with some raising concerns 

those Federal programs may not have 

sufficient funding to cover the losses 

associated with the Fire. One 

commenter stated that FEMA must be 


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responsible for identifying other Federal 

programs and help claimants receive 

other identified funding in a timely 

manner to ensure they do not lose out 

on the Act’s funding based on available 

funding that they may otherwise never 

receive. 

FEMA Response: Section 296.21(c) of 

the IFR states that compensatory 

damages may be awarded for the ‘‘cost 

of reforestation or revegetation not 

covered by any other Federal program.’’ 

This language has caused confusion 

with commenters as interpreting it to 

require claimants to first apply with 

other Federal programs. FEMA does not 

require claimants to apply to other 

Federal programs associated with 

reforestation and/or revegetation. 

Rather, the language was intended to 

clarify that, where the claimant has 

received payment from another Federal 

program, FEMA will only be able to 

compensate for reforestation and/or 

revegetation under the Act for those 

costs not covered already in the 

payment received from the other 

Federal program. This avoids a 

duplication of payment for the same 

damage. Claimants have the option of 

seeking assistance from other Federal 

programs for reforestation and 

revegetation, filing for compensation 

under the Act, or pursuing both other 

Federal program and compensation 

under the Act. The language in 

§ 296.21(c) is simply to clarify that 

FEMA cannot duplicate payment but 

can provide additional payment to cover 

actual compensatory damages for 

reforestation and revegetation. As 

explained above, FEMA is coordinating 

with other Federal agencies to ensure 

data sharing and better communication 

between programs. FEMA has engaged 

with and continues to engage with the 

Small Business Administration, the 

Department of Agriculture, and other 

Federal agencies to help facilitate 

coordination of the assistance available 

to claimants and the impacted 

communities. Consistent with the Act’s 

requirements in section 104(g), FEMA is 

in consultation with other Federal 

agencies, and State, local, and Tribal 

authorities to ensure the efficient 

administration of the claims process to 

include ways to ensure claimants have 

the information they need regarding 

Federal programs available to them. 

Comment: Commenters also sought 

clarification on the distinctions between 

claims for reforestation and revegetation 

and subsistence or business loss. A 

commenter wrote that many claimants 

used trees for subsistence resources and 

asked for clarification regarding whether 

trees could be considered subsistence 

resources based on the language of the 

IFR. 

FEMA Response: As explained in the 

IFR, FEMA limited compensation for 

trees and other landscaping to 25 

percent of the pre-Fire value of the 

structure and lot. This approach was 

generally consistent with the approach 

taken in the Cerro Grande Fire 

Assistance process. As explained in the 

IFR, the 25 percent limitation did not 

apply to business losses for timber, 

crops, and other natural resources under 

§ 296.21(d). In response to commenter 

concerns and confusion regarding the 

application of this formula, FEMA is 

revising this paragraph in the Final Rule 

to eliminate references to the 25 percent 

formula as the Cerro Grande formula is 

not appropriate given the geographic, 

economic, and cultural distinctions 

between that area and the areas 

impacted by this Fire. The Final Rule 

allows for compensatory damages for 

the cost of replacement of destroyed 

trees and other landscaping. 

Compensation for business loss and 

subsistence resources continue to be 

compensated at 100 percent. FEMA 

further notes that the definition of 

‘‘subsistence resources’’ in § 296.4 of the 

Final Rule includes firewood or other 

natural resource gathering, timbering, or 

agricultural activities undertaken by the 

claimant without financial 

renumeration. This definition should 

encompass the loss of trees as 

subsistence resources. The edits made to 

§ 296.21(c)(2) of the Final Rule are 

sufficient to address the commenters’ 

concerns and modify the claims process 

to more appropriately address the needs 

of the claimants and communities 

impacted by this Fire. 

3. Comments on § 296.21(c)(3) Decrease 

in Value of Real Property 

Comment: Several commenters 

recommended FEMA delete the 

requirement that claimants demonstrate 

the value of the real property was 

permanently diminished as a result of 

the Fire. Two commenters 

recommended FEMA revise the 

language to ‘‘significantly’’ or ‘‘longterm.’’ 

FEMA Response: FEMA agrees that it 

will be difficult to demonstrate the real 

property value is permanently 

diminished given the size and scope of 

the Fire as well as the types of damages 

caused to real property in this area. As 

discussed above, the Hermit’s Peak/Calf 

Canyon Fire impacted communities that 

are less densely populated and more 

heavily forested than the Cerro Grande 

Fire. These undeveloped areas may not 

be able to easily establish a permanent 

diminution in value as a result of the 

Fire. FEMA is removing the term 

‘‘permanently’’ from § 296.21(c)(3) in 

the Final Rule and is rewriting this 

paragraph to read that the claimant can 

establish that the value of the real 

property was significantly diminished 

long-term as a result of the Hermit’s 

Peak/Calf Canyon Fire. This change 

addresses the commenters’ concerns 

regarding their ability to prove property 

values were permanently diminished 

while also still requiring some 

demonstration of a significant 

diminution in property value that is 

long-term in nature. The change in the 

Final Rule balances the need to 

compensate claimants for actual 

compensatory damages with the 

challenges of demonstrating a loss of 

property value where the claimant does 

not sell the property. 

Comment: Commenters raised specific 

concerns in documenting the 

diminution of property value, noting 

real estate sale amounts are not 

available in public records in New 

Mexico and recommending FEMA 

develop a method to compensate for real 

property claims using local appraisers, 

insurance records, and tax assessments. 

FEMA Response: FEMA understands 

these concerns and will be developing 

tools to assist claimants with this 

process. The regulatory text does not 

require revision as the process for 

demonstrating this injury can be better 

addressed in tools developed for 

claimants to accompany Claims Office 

policy and procedures. 

Comment: Some commenters sought 

the inclusion of intrinsic value in this 

loss calculation. 

FEMA Response: Generally, FEMA’s 

calculation of damages, including how 

damaged property is valued, will be 

governed by the Act and Federal law 

and, to the extent it is not pre-empted 

by Federal law, New Mexico law. 

Comment: One commenter stated the 

loss calculation would increase if 

neighboring homes were not also 

rebuilt. 

FEMA Response: FEMA recognizes 

that not every property owner will file 

a claim or seek to rebuild on their 

property. Claimants receiving payment 

for their real property are not required 

to rebuild and FEMA cannot require 

property owners to do so. Claimants 

may provide information on how the 

lack of rebuilding in their area is 

impacting their property value when 

filing a claim under this paragraph. 

Comment: Another commenter 

suggested FEMA provide more than two 

years to be able to claim the loss of 

property value. The commenter stated 

‘‘for those of us who are not going to sell 

our property in the next two years, how 


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are we going to claim the loss in value 

of our property due to the fire and 

flood? I believe that the regulation 

should contemplate more than [two] 

years to be able to claim this loss.’’ 

FEMA Response: As explained above, 

some deadlines in the rule are beyond 

FEMA’s control. The Act requires 

claimants submit their Notice of Loss no 

later than November 14, 2024, two years 

from the date the IFR is published. 

FEMA has built in extensions of this 

timeline for good cause, recognizing the 

realities of the Fire’s impact. Sections 

296.34 and 296.35 below establish a 

process for notifying FEMA of injuries 

that are not referenced in the initial 

Notice of Loss. In § 296.35, the IFR 

allows claimants to reopen a claim no 

later than November 14, 2025 if they 

sold their real estate and wished to 

present a claim for decrease in the value 

of real property. Additionally, claimants 

may request compensation for a 

decrease in the value of real property if 

they can demonstrate the value of the 

real property was significantly 

diminished long-term as a result of the 

Fire pursuant to changes made to this 

section in the Final Rule. 

Comment: Several commenters 

suggested FEMA incorporate language 

regarding water rights into this 

paragraph because water rights are 

treated as property rights in New 

Mexico and a claimant should be 

permitted to submit a claim for the 

decrease in value of a water right. 

FEMA Response: Claimants can file a 

claim for damages regarding water rights 

under the current language of this 

section and no changes are required in 

the Final Rule. Specifically, the current 

regulatory language regarding real 

property can be read to include water 

rights attached to that real property. 

4. Comments on § 296.21(c)(4) 

Subsistence 

Comment: Commenters raised 

questions about how damages would be 

defined and calculated under this 

paragraph. One commenter stated 

claimants in the area tend to practice 

self-sustainability in addition to using 

the land for business purposes and 

asked that FEMA further define on how 

losses under this would be calculated. 

Another commenter wrote ‘‘FEMA 

needs to build in as much flexibility as 

possible for compensating future claims 

related to lost subsistence. The 

restoration of certain subsistence 

resources is difficult to predict, and the 

services may be permanently lost in 

certain cases.’’ Comments were also 

received on the appropriate timeline for 

when these resources can reasonably be 

expected to return to the level of 

availability that existed prior to the Fire. 

Some commenters suggested that FEMA 

determine a date of five years as the 

timeline by which subsistence resources 

can be expected to return to the level of 

availability that existed before the Fire 

while at least one commenter felt that 

five years was not a sufficient period of 

time. 

FEMA Response: FEMA recognizes 

the challenges associated with 

calculating damages for subsistence. 

FEMA anticipates consulting experts 

with respect to subsistence resource 

claims to ensure the damages 

calculations address the reasonable cost 

of replacing these resources and the 

timeline for when these resources can 

reasonably be expected to return to the 

level of availability that existed prior to 

the Fire. FEMA is looking at ways to 

better streamline the claims process in 

response to other comments and is 

considering offering payment formulas 

for subsistence. Any such type of 

formula would provide claimants with 

the option to either leverage that 

formula with their claim or submit 

documentation detailing their specific 

damages. 

Comment: Some commenters 

suggested that income losses be 

considered part of subsistence losses. A 

commenter suggested that the 

regulations acknowledge that 

subsistence resources can also be the 

primary source of revenue and income 

for impacted individuals and 

businesses. 

FEMA Response: FEMA disagrees 

with the commenter. As defined at 

§ 296.4, ‘‘subsistence resources’’ include 

‘‘activities undertaken by the claimant 

without financial renumeration’’ and 

losses involving revenue and income are 

better addressed as business loss. 

Comment: Other commenters sought 

compensation for ongoing costs for rent, 

food, energy, and other resources 

needed to maintain a subsistence 

lifestyle both in the immediate and 

long-term. One commenter suggested 

FEMA fully cover the recovery costs 

necessary to restore agricultural systems 

and damages and mitigation costs 

related to water quality, water rights, 

and soil health impairments for 

household and subsistence uses. 

FEMA Response: FEMA recognizes 

that the loss of subsistence resources 

can result in the need to obtain 

substitute resources in the cash 

economy. The current IFR allows for the 

costs of obtaining substitute resources in 

the cash economy to be considered 

compensatory damages. Other Federal 

and/or State programs may also address 

some of the immediate costs such as 

rent raised by commenters. To the 

extent the agricultural system and 

related costs constitute a subsistence 

resource (i.e., one for which the 

claimant receives no financial 

renumeration), it can be considered 

under a subsistence resource claim. To 

the extent such a system and related 

costs are for financial renumeration, a 

claim can be filed for damages as a 

business loss. As explained above, 

claimants can file a claim for damages 

regarding water rights under the current 

language of the regulation and no 

changes are required in the Final Rule. 

Specifically, the current regulatory 

language regarding real property can be 

read to include water rights attached to 

that real property. 

Comment: Several commenters on 

this paragraph focused on the need for 

firewood and other subsistence 

resources, with one commenter 

requesting vouchers for firewood for the 

next five to ten years or until the forests 

have regrown to support subsistence 

firewood requirements. 

FEMA Response: The IFR includes 

firewood gathering as a subsistence 

resource that can be compensable. 

Claimants can seek compensation for 

firewood under the subsistence 

resources paragraphs of the regulation 

and, where firewood may have been 

sold by the claimant, under the business 

loss paragraph of the regulation. 

5. Comments on Physical Infrastructure 

(New § 296.21(c)(5)) 

Comment: Several commenters 

suggested FEMA incorporate language 

into the regulation clarifying the 

availability of compensation for 

damages to physical infrastructure. Two 

commenters recommended FEMA 

specifically incorporate guidance on 

acequias in the Final Rule to help 

alleviate challenges for claimants. 

Another commenter suggested language 

be added to this paragraph to include 

physical infrastructure such as irrigation 

infrastructure, acequias, and the loss of 

use of irrigation water rights 

appurtenant to the land with which 

other commenters agreed. 

FEMA Response: Consistent with the 

Act at section 104(d)(4)(A)(iii), FEMA is 

adding paragraph (c)(5) to § 296.21 to 

address physical infrastructure damage. 

This paragraph clarifies that claimants 

may seek compensation for the damage 

or destruction of physical infrastructure 

that may include damage to irrigation 

infrastructure such as acequia systems. 

This addition is consistent with the Act 

and incorporating this language better 

reflects the unique challenges faced by 

the communities impacted by the Fire. 

As explained above, claimants can file 

a claim for damages regarding water 


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rights under the current language of the 

regulation and no changes are required 

in the Final Rule. 

I. Comments on § 296.21(d) Business 

Loss 

Comment: Some commenters raised 

questions about the types of damages 

that would be considered as business 

losses, from opportunities to seek other 

business ventures to compensating for 

lost opportunity, agricultural loss, 

future business loss, lost income from 

landowner tag use or national forest 

permits, and future lost income. 

FEMA Response: In paragraph (d), 

FEMA details the types of damages 

generally considered eligible for 

compensation. This list, however, is not 

all inclusive and FEMA will review 

each claim on a case-by-case basis to 

determine whether the loss is eligible 

for compensation under the Act. 

Claimants should submit all claims 

associated with loss or damages 

resulting from the fire for review and 

consideration. 

Comment: Two commenters suggested 

compensation for economic 

development for the areas impacted by 

the Fire. 

FEMA Response: As explained above, 

economic development can be 

speculative and a claimant seeking 

compensatory damages for loss of 

economic development would need to 

be able to demonstrate such loss was a 

result of the Fire. The IFR currently 

provides the types of actual 

compensatory damages that are 

compensable under the Act, but that list 

is not all-inclusive. Claimants seeking 

compensation for actual compensatory 

damages not specifically listed in the 

regulation can still submit a claim for 

compensation under the Act. For this 

type of claim, claimants should consider 

how these damages would be 

considered actual compensatory 

damages for injuries resulting from the 

Fire consistent with the Act. FEMA does 

not believe changes to the regulatory 

text are required in the Final Rule for 

claimants to seek this type of 

compensation if they can demonstrate 

the loss and that the loss resulted from 

the Fire. 

Comment: One commenter suggested 

FEMA cover damages and mitigation 

costs related to water quality and water 

rights impacts to businesses, including 

agricultural producers. 

FEMA Response: Businesses may file 

claims for damages associated with 

water rights as part of claims associated 

with damages to real property under 

that paragraph and/or under business 

loss. 

Comment: Some commenters asked 

how FEMA would calculate business 

losses and specifically loss of business 

income given the economic challenges 

presented by the COVID–19 pandemic. 

Commenters generally stated that FEMA 

consider the time period prior to the 

pandemic, but also to consider other 

factors such as prior fires impacting the 

area. 

FEMA Response: FEMA understands 

the challenges regarding the appropriate 

timeline for consideration of business 

loss calculations given the COVID–19 

pandemic and prior disasters. FEMA 

must also consider the programs 

available to businesses during those 

periods and the financial resources 

those programs may have provided to 

businesses. Claimants seeking 

compensation should present what they 

believe is a reasonable period of time to 

demonstrate their income and business 

losses resulting from the Fire. FEMA 

anticipates future policy and procedure 

documents will provide examples to 

help claimants with this type of 

compensation request. 

Comment: Commenters also asked 

about the types of businesses that are 

covered under the Act. One comment 

stated the statutory construction of the 

Act allows for reimbursement of 

business loss for nonprofit 

organizations. 

FEMA Response: The current 

definition of ‘‘injured person’’ includes 

‘‘other non-Federal entity’’ and that 

terminology encompasses non-profit 

organizations. While FEMA understands 

the importance of non-profit 

organizations in the relief process, the 

agency believes the current definition 

sufficiently encompasses all types of 

for-profit and non-profit entities and 

those entities can seek damages for 

business loss. 

Comment: Two commenters asked 

about the eligibility for business losses 

for those communities that were not in 

the direct area of the Fire but suffered 

losses as a result of the Fire. In 

prioritizing these claims, a commenter 

asked FEMA to first consider claims 

from claimants with actual fire and 

flood damage, but then consider 

business loss for claimants where the 

State closed off areas during the Fire. 

FEMA Response: Unlike disaster 

declarations that cover a specific 

geographic area, the Act covers all 

injured parties that suffered injuries as 

a result of the Fire. Claimants seeking 

compensation for their business losses 

should file a claim demonstrating their 

loss was a result of the Fire for 

consideration. Regarding prioritization, 

FEMA is amending § 296.13 to 

specifically clarify the prioritization 

required under section 104(d)(1)(A)(ii) 

of the Act that requires FEMA to place 

priority on claims submitted by injured 

parties that are not insurance companies 

seeking payment as subrogees. FEMA 

will work to ensure that all claims are 

reviewed in an expeditious and fair 

manner. 

Comment: Finally, a commenter asked 

questions about the reforestation 

damages formula and its application to 

business losses for revenue received 

from cutting Christmas trees on their 

property. 

FEMA Response: As explained in the 

IFR, business losses are distinct from 

reforestation losses and a formula 

developed for reforestation would not 

be applied to those losses. Timber, 

crops, and other natural resources were 

listed under business losses in 

paragraph (d). With the updates made to 

paragraph (c)(2) above, FEMA has 

removed the 25 percent reforestation 

formula from the regulation. Business 

losses are not subject to a specific 

formula as part of compensation under 

the regulation. 

J. Comments on § 296.21(e) Financial 

Loss Generally 

Comment: Commenters raised 

questions about the types of financial 

losses to be covered under the Act and 

the eligible claimants for financial 

losses. One commenter suggested FEMA 

clarify how claimants can be 

compensated for the increased cost of 

homeowner and business insurance, 

stating these additional expenses will be 

ongoing for decades. Another 

commenter suggested FEMA cover 

unforeseen financial costs associated 

with evacuations. 

FEMA Response: In paragraph (e), 

FEMA details the types of damages 

generally considered eligible for 

compensation under financial loss. This 

list, however, is not all inclusive and 

FEMA will review each claim on a caseby-case basis to determine whether or 

not the loss is eligible for compensation 

under the Act. Claimants should submit 

all claims associated with financial loss 

for review and consideration. 

Comment: One comment stated the 

statutory construction of the Act allows 

for reimbursement of financial loss for 

nonprofit organizations. 

FEMA Response: The current 

definition of ‘‘injured person’’ includes 

‘‘other non-Federal entity’’ and that 

terminology encompasses non-profit 

organizations. While FEMA understands 

the importance of non-profit 

organizations in the relief process, the 

agency believes the current definition 

sufficiently encompasses all types of 

for-profit and non-profit entities and 


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those entities can seek damages for 

financial loss. 

Comment: One commenter made 

several specific suggestions in their 

comment seeking funding for public 

transportation and increased county 

staff salaries and fringe benefits. 

FEMA Response: As explained above, 

FEMA details the types of damages 

generally considered eligible for 

compensation under financial loss in 

this paragraph in the IFR. This list, 

however, is not all inclusive and FEMA 

will review each claim on a case-by-case 

basis to determine whether or not the 

loss is eligible for compensation under 

the Act. Claimants should submit all 

claims associated with business loss for 

review and consideration. FEMA 

reminds claimants that they must 

demonstrate that the financial loss was 

a result of the Fire. FEMA does not 

believe changes to the regulatory text 

are required in the Final Rule for 

claimants to seek financial losses if they 

can demonstrate these losses were a 

result of the Fire. 

Comment: Two commenters wrote 

that FEMA should provide funding to 

allow for economic redevelopment and 

stimulus activities under business and/ 

or financial loss. 

FEMA Response: As explained above, 

economic development can be 

speculative and a claimant seeking 

compensatory damages for loss of 

economic development would need to 

be able to demonstrate such loss was a 

result of the Fire. The IFR currently 

provides the types of actual 

compensatory damages that are 

compensable under the Act, but that list 

is not all-inclusive. Claimants seeking 

compensation for actual compensatory 

damages not specifically listed in the 

regulation can still submit a claim for 

compensation under the Act. For this 

type of claim, claimants should consider 

how these damages would be 

considered actual compensatory 

damages to compensate claimants for 

injuries resulting from the Fire 

consistent with the Act. FEMA does not 

believe changes to the regulatory text 

are required in the Final Rule for 

claimants to seek this type of 

compensation if they can demonstrate 

the loss and that the loss resulted from 

the Fire. 

1. Comments on § 296.21(e)(1) Recovery 

Loans 

Comment: One commenter wrote that 

claimants are carrying the cost burden 

of paying interest on loans provided by 

the SBA and suggested that FEMA 

define a process in coordination with 

the SBA such that when an individual 

signs a Notice of Loss, any further 

payment of SBA interest will be 

deferred. 

FEMA Response: Section 296.21(e)(1) 

of the IFR provides compensation for 

interest paid on recovery loans, 

including SBA loans, and FEMA will 

cooperate with the SBA for procedures 

on the repayment of those loans. While 

FEMA intends to compensate claimants 

for interest paid on their SBA or other 

recovery loan, FEMA does not have the 

statutory authority to defer payment of 

interest on SBA loans in the interim. 

2. Comments on § 296.21(e)(2) Flood 

Insurance 

Comment: Commenters suggested 

specific changes to this section of the 

IFR. Specifically, commenters suggested 

the agency delete the two-year 

limitation on flood insurance. Some 

commenters requested a five-year period 

for flood insurance coverage while 

suggested a 10- or 15-year period of 

coverage. Commenters also requested 

that these premium payments be 

available as compensation for claimants 

that are not required to purchase flood 

insurance. 

FEMA Response: Section 

104(d)(4)(C)(viii) of the Act provides for 

payment of flood insurance premiums 

required to be paid on or before May 31, 

2024. FEMA expanded upon this 

section of the Act to provide claimants 

with payment for flood insurance 

premiums even if the claimant is not 

required to purchase flood insurance, as 

the agency understands some claimants 

may have legitimate reasons for concern 

around flooding even if they are not 

currently required to maintain flood 

insurance. FEMA exercised the 

discretion in section 104(d)(4)(C)(x) to 

allow compensation for flood insurance 

premiums if the claimant purchased 

flood insurance after the Fire due to the 

fear of heightened flood risk. FEMA 

does not believe, however, that the 

agency has the statutory authority to 

extend these payments beyond the 

period set by Congress in the Act. The 

current regulatory text sufficiently 

addresses the timeline and explains that 

both claimants currently required to 

purchase flood insurance and those 

claimants that purchase flood insurance 

based on their fear of heightened flood 

risk will be compensated for their flood 

insurance premiums due on or before 

May 31, 2024. As explained in the IFR, 

FEMA may provide flood insurance to 

such claimants directly through a group 

or blanket policy. The terms of that 

policy may allow for a longer period of 

coverage than the annual renewals 

under the regular National Flood 

Insurance Program Standard Flood 

Insurance Policy so long as the premium 

for that policy is paid on or before May 

31, 2024. Additionally, FEMA notes that 

the Act provides for funding for 

heightened risk reduction to help 

alleviate the long-term impacts of 

flooding. This funding under 

§ 296.21(e)(5) is available for claimants 

to file a claim until November 14, 2025. 

Comment: One commenter wrote 

asking FEMA to clarify that an increase 

in flood insurance premiums is 

allowable as an allowable financial loss. 

FEMA Response: As explained above, 

section 104(d)(4)(C)(viii) of the Act 

provides compensation for payment of 

flood insurance premiums paid on or 

before May 31, 2024. The current 

regulatory text sufficiently addresses the 

timeline and explains that both 

claimants currently required to 

purchase flood insurance and those 

claimants that purchase flood insurance 

based on their fear of heightened flood 

risk will be compensated for their flood 

insurance premiums paid on or before 

May 31, 2024 even if those premiums 

increase. FEMA does not believe 

changes to the regulatory text are 

required in the Final Rule for this 

clarification. 

3. Comments on § 296.21(e)(3) Out-ofPocket Expenses for Mental Health 

Treatment 

Comment: Commenters were 

generally supportive of this paragraph 

but sought clarifications and an 

extension of the time for which 

expenses would be compensated. Most 

commenters asked FEMA to consider 

the long-term impacts of the Fire and 

extend the coverage of expenses beyond 

2024. A commenter stated that negative 

mental and emotional impacts would 

continue for decades, if not through the 

remainder of their lives. Another 

commenter wrote that not all mental 

health impacts of this major disaster 

were known to us now and would take 

additional time to be identified and 

treated, recommending FEMA extend 

this reimbursement deadline to 

treatments rendered by the end of 2025. 

FEMA Response: FEMA appreciates 

the concerns raised by commenters on 

the timeline associated with out-ofpocket mental health expenses. In the 

IFR, FEMA limited this timeline to 

April 6, 2024, two years after the date 

the Fire began. FEMA agrees that this 

timeline should be extended and 

recognizes that mental health treatment 

may extend beyond the deadline to file 

a claim. The Final Rule extends the 

deadline allowing claimants to seek 

reimbursement for out-of-pocket mental 

health treatment expenses for treatment 

identified on or before November 14, 

2024. FEMA is extending the deadline 


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until November 14, 2024 for consistency 

with the timeline to file a claim under 

the Act to ensure that all treatment 

identified during that period may be 

claimed. FEMA recognizes that mental 

health treatment may extend beyond the 

deadline for filing a claim and claimants 

may also reopen claims under § 296.35 

for good cause. 

Comment: One commenter expressed 

confusion about whether or not mental 

health treatment would be 

compensated. Other commenters 

requested clarification that the mental 

health treatment expenses apply to 

conditions that the Fire worsened. 

FEMA Response: FEMA is revising 

§ 296.21(e)(3) in the Final Rule to clarify 

that compensation will be available for 

out-of-pocket mental health treatment 

expenses for conditions resulting from 

and conditions that were worsened by 

the Fire. This change in the Final Rule 

will ensure those victims whose 

conditions worsened as a result of the 

Fire will be able to receive 

compensation for out-of-pocket mental 

health treatment expenses. 

Comment: Commenters also raised 

questions about personal injuries and 

physical health conditions, raising 

questions about long-term health effects 

because of exposure to contaminant and 

carcinogens and other air and water 

pollutants as a result of the Fire and 

how FEMA would cover those damages. 

FEMA Response: As one commenter 

noted, FEMA defines injury in § 296.4 to 

include personal injury consistent with 

the Federal Tort Claims Act and 

personal injury damages are 

compensable under the Act. FEMA lists 

the types of damages for which 

compensation may be awarded for 

financial loss. This list, however, is not 

all inclusive and FEMA will review 

each claim on a case-by-case basis to 

determine whether or not the loss is 

eligible for compensation under the Act. 

Claimants should submit all claims 

associated with personal injury for 

review and consideration. FEMA does 

not believe changes to the regulatory 

text from the IFR are required in the 

Final Rule given the definition of injury 

clearly encompasses personal injury. 

4. Comments on § 296.21(e)(4) 

Donations 

Comment: Most commenters generally 

supported extending the timeframe 

provided for donations beyond the 

September 20, 2022 timeframe provided 

in the IFR. Three commenters supported 

changing the timeframe for donations to 

one year after the Fire was contained. 

Two of the three commenters disagreed 

on the appropriate date to reflect one 

year after the Fire’s containment with 

one commenter recommending August 

30, 2023 and another recommending 

FEMA change the date to August 21, 

2023. 

FEMA Response: FEMA agrees that 

the timeframe should be extended and 

given the confusion regarding the 

timeline for the Fire’s containment, 

FEMA is changing the deadline in the 

Final Rule from September 20, 2022 to 

November 14, 2022 to reflect the date 

the IFR was published. FEMA seeks to 

balance the need to extend this deadline 

with concerns raised by other 

commenters regarding the inclusion of 

donations as allowable financial loss 

damages in the IFR. Setting the 

timeframe for these donations to the 

IFR’s publication date ensures that those 

donations made to support those 

suffering from the Fire will be 

compensated up until the date at which 

claimants had a better understanding of 

how FEMA would provide for 

compensation for their losses and the 

date when claimants could begin to 

pursue a claim under the Act thus 

reducing the need to rely on these 

donations. 

Comment: Two individual 

commenters opposed the inclusion of 

donations in the regulation. A 

commenter wrote ‘‘Voluntary and 

charity is just that, given freely and 

without expectation of gain or 

reimbursement. If that was the actual 

intent of the presence of these 

organization in the area, then they 

should not be reimbursed for their acts 

of charity and volunteering.’’ Another 

commenter asked if there were other 

programs that could compensate these 

organizations for the donations 

provided to the people of impacted by 

the Fire. A different commenter 

recommended FEMA prioritize payment 

of claims for property loss, financial 

loss, and business loss before 

reimbursing claims for voluntary 

donations. 

FEMA Response: FEMA incorporated 

the ability to seek compensation for 

financial loss for donations consistent 

with the Cerro Grande Fire Assistance 

process. FEMA heard from the public 

that this Fire is distinct in many ways 

from the Cerro Grande Fire and requires 

differences in the process but believes 

the ability to compensate those that 

provided donations should remain in 

the Final Rule given the Hermit’s Peak/ 

Calf Canyon Fire’s impact. FEMA 

understands that these donations may 

have come from individuals, businesses, 

and other entities not just charitable 

organizations whose sole purpose is 

providing such services and wants to 

ensure those claimants are able to seek 

compensation for their donation efforts 

to support the community. Recognizing 

the concerns raised by these 

commenters as well as those 

commenters that felt this was an 

important component of the IFR, FEMA 

is extending but still limiting the 

timeframe available for those seeking 

compensation for financial losses 

associated with donations to the date 

the IFR was published. Setting the 

timeframe for these donations to the 

IFR’s publication date ensures that those 

donations made to support those 

suffering from the Fire will be 

compensated up until the date at which 

claimants had a better understanding of 

how FEMA would provide for 

compensation for their losses and the 

date when claimants could begin to 

pursue a claim under the Act thus 

reducing the need to rely on these 

donations. FEMA also recognizes that 

donations to injured parties are not 

considered a duplication of benefits and 

that extension of the time frame would 

create the anomalous situation where 

FEMA would be duplicating 

compensation. FEMA agrees with the 

commenter that prioritization of claims 

should be focused first on claims for 

property loss, financial loss, and 

business loss before reimbursing claims 

for voluntary donations and will 

implement a process to ensure this 

prioritization to the greatest extent 

possible. 

5. Comments on § 296.21(e)(5) 

Heightened Risk Reduction 

Comment: Commenters generally 

opposed the formula for compensation 

provided for heightened risk reduction 

efforts. Several commenters 

recommended deleting the 25 percent 

formula for heightened risk reduction 

efforts. A commenter wrote that the Act 

did not impose caps on tree or 

mitigation damages. A different 

commenter wrote that the Act addressed 

limits on damages, limiting them to 

‘actual compensatory damages 

measured by injuries suffered’ and that 

the Act further placed New Mexico law 

in a position subordinate to the terms of 

the Act itself by allowing for New 

Mexico law to govern the calculation of 

damages. Another commenter stated 

that ‘‘these arbitrary Urban Centric caps 

do not make victims whole as required 

by the Act but rather shorts the 

landowners.’’ 

FEMA Response: FEMA recognizes 

that this Fire is distinct from the Cerro 

Grande Fire and that the formula for 

compensation utilized for the Cerro 

Grande Fire Assistance process will not 

sufficiently address the risk reduction 

needs for claimants in this Fire and is 

eliminating the 25 percent formula from 


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the Final Rule. Specifically, FEMA is 

removing the language ‘‘Compensation 

under this section may not exceed 25 

percent of the higher of payments from 

all sources (i.e., the Act, insurance 

proceeds, FEMA assistance under the 

Stafford Act) for damages to the 

structure and lot, or the pre-fire value of 

the structure and lot’’ from the Final 

Rule. FEMA also recognizes that 

compensation for risk reduction is not 

generally compensable under New 

Mexico law. 

Comment: Commenters also 

questioned the language in the IFR 

requiring that claimants must complete 

the risk reduction project for which they 

receive compensation. One commenter 

wrote that the requirement that the risk 

reduction project must be completed 

before compensation can be awarded 

was an incorrect reading of the Act. 

‘‘The word ‘incurred’ in Section 

104(d)(4)(C)(vii) of the Act does not 

mean ‘completed’ or ‘paid.’ Rather, the 

word ‘incur’ means ‘‘to become through 

one’s own action liable or subject to.’ 

(Oxford English Dictionary.) If a 

claimant has contracted for risk 

reduction work or started but not 

completed the work for which he/she 

will be financially responsible, the 

claimant has ‘‘incurred’’ the cost within 

the meaning of the statute. Requiring the 

work to be completed before 

compensation is awarded defeats the 

purpose of the Act to compensate fire 

victims for their losses. Requiring work 

to be completed prior to compensation 

defeats the intent of the Act and is 

patently unreasonable. To require a 

wildfire victim to advance money to 

remediate the damage caused by the 

Forest Service, but not be recompensed 

until the work is complete, is not within 

the express language or intent of the 

Act.’’ Another commenter wrote that 

requiring completion of the risk 

reduction work before compensation 

would be provided defeated the purpose 

of the Act as many claimants would not 

be able to afford to do the work without 

the compensation funds. This 

commenter stated that once a claimant 

secured a contract for the risk reduction 

work, they would have technically 

incurred the costs and the Act allows for 

advance or partial payments before final 

settlement. 

FEMA Response: FEMA disagrees 

with the commenters’ reading of the IFR 

that there is a requirement to complete 

the work before compensation can be 

received. Rather, the IFR states that 

claimants ‘‘must complete the risk 

reduction project for which they receive 

compensation.’’ FEMA does not require 

that the work be completed prior to 

payment. Rather, the language requires 

applicants to complete the work for 

which they receive compensation 

related to the risk reduction project. 

FEMA understands that claimants may 

not have completed the project at the 

time the claim for this compensation is 

filed and anticipates these claims may 

include estimates for the work to be 

done specifically by allowing claimants 

to amend their Notice of Loss by 

November 14, 2025. Claimants must 

ultimately complete the risk reduction 

project for which they receive 

compensation as failing to do so would 

be contrary to the Act’s purpose in 

providing compensation to reduce these 

risks, and because the compensation 

provided would not generally be 

otherwise available in litigation under 

New Mexico law. FEMA retains the 

right to inspect real property. See 

§ 296.30. 

Comment: One commenter suggested 

removing all language related to the 25 

percent formula as well as language 

regarding the deadlines associated with 

filings and that claimants should 

consider current building codes and 

complete the project for which they 

receive compensation. 

FEMA Response: FEMA agrees with 

the commenter regarding the formula 

and is removing the sentence associated 

with it as explained above. However, 

FEMA disagrees that the agency can and 

should remove the remaining language 

in the IFR. The IFR provides a deadline 

by which claimants must submit the 

claim for compensation for heightened 

risk reduction efforts. This language is 

consistent with other sections of the 

regulation where deadlines are 

provided, and the deadline provided 

here is consistent with the Act. FEMA 

generally does not have the statutory 

authority to extend this deadline. FEMA 

further believes claimants should be 

encouraged to consider current building 

codes and standards when completing 

heightened risk reduction projects as 

these codes and standards should 

generally result in more resilient 

rebuilding and likely will be mandatory 

under local building ordinances. 

Finally, as explained above, claimants 

must complete the risk reduction project 

for which they receive compensation as 

failing to do so would be contrary to the 

Act’s purpose in providing 

compensation to reduce these risks. 

FEMA retains the right to inspect real 

property. See § 296.30. 

Comment: One commenter requested 

that FEMA not attempt to reassure 

claimants of the safety of rebuilding 

homes where they once stood as the Fire 

impacts now made those areas 

extremely high-risk hazard zones. 

FEMA Response: FEMA understands 

concerns about rebuilding immediately 

after the Fire and will work with 

claimants to discuss how these concerns 

can be addressed as part of the 

heightened risk reduction process. The 

Act allows for these damages and FEMA 

is required to provide actual 

compensatory damages to claimants 

seeking them under the Act. FEMA does 

not believe any changes to this section 

of the Final Rule are required to address 

this concern. 

Comment: One commenter asked how 

heightened risk reduction loss would be 

calculated and whether payment would 

be made for processes completed and 

for those anticipated to be completed. 

FEMA Response: Claimants seeking 

compensation for this loss should 

submit the documentation they have 

showing costs incurred or expected to 

be incurred as part of the heightened 

risk reduction project. As explained 

above, the IFR states that claimants 

‘‘must complete the risk reduction 

project for which they receive 

compensation.’’ FEMA does not require 

that the work be completed prior to 

payment. Rather, the language requires 

applicants to complete the work for 

which they receive compensation 

related to the risk reduction project. 

FEMA understands that claimants may 

not have completed the project at the 

time the claim for this compensation is 

filed and anticipates these claims may 

include estimates for the work to be 

done specifically by allowing claimants 

to amend their Notice of Loss by 

November 14, 2025. Claimants must 

ultimately complete the risk reduction 

project for which they receive 

compensation as failing to do so would 

be contrary to the Act’s purpose in 

providing compensation to reduce these 

risks. FEMA retains the right to inspect 

real property. See § 296.30. 

Comment: Several commenters 

recommended FEMA add language to 

this section to state that ‘‘compensation 

under this section will not be awarded 

for costs that have been reimbursed 

under FEMA’s Public Assistance 

Programs or by insurance.’’ The 

commenters requested that FEMA 

interpret this limitation liberally and in 

alignment with FEMA’s mission. 

FEMA Response: FEMA appreciates 

the commenters’ desire for clarity, but 

the agency believes § 296.21(e) resolves 

these concerns. Specifically, the IFR at 

§ 296.21(e) states that FEMA is not 

authorized to compensate claimants for 

damages paid by insurance. Further, 

§ 296.21(f)(2) states that ‘‘compensation 

will not be awarded under the Act for 

injuries or costs that are eligible under 

the Public Assistance Program.’’ FEMA 


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does not believe revising the Final Rule 

as requested by the commenters is 

necessary to meet the intent of the 

statute. FEMA notes the commenters’ 

desire for the agency to consider 

additional risk reduction efforts to make 

individuals and communities more 

resilient than the pre-Fire condition, but 

the Act limits FEMA’s authority to 

compensate claimants to the costs of 

reasonable efforts to reduce risks to 

levels prevailing prior to the Fire. If a 

claimant seeks to implement a 

heightened risk reduction project that 

will result in reduced risks beyond the 

level prevailing at the time of the Fire, 

FEMA will consider such a request on 

a case-by-case basis consistent with the 

agency’s discretion under the Act. 

Comment: A commenter wrote 

regarding nature-based solutions, stating 

that the science was well established, 

and that these solutions were actively 

applied by the U.S. Forest Service to 

burned areas. The commenter 

mentioned mulching, seeding, and 

replanting burned forest ground as 

accepted means of reduction the risk of 

flood waters running downslope. 

FEMA Response: FEMA appreciates 

the commenter’s response to the 

agency’s request for feedback regarding 

nature-based solutions. FEMA continues 

to support implementation of these 

solutions where appropriate and 

encourages claimants to consider 

nature-based solutions as part of their 

claim for compensation under this 

provision. 

Comment: One commenter 

recommended that FEMA develop some 

pre-approved mitigation opportunities 

for homeowners, businesses, and other 

entities to allow claimants to better 

determine the appropriate projects for 

them. The commenter stated that this 

would allow the Claims Office to 

automatically approve those projects 

with the present dollar amount and thus 

not require every single specific claim 

go through some arduous mitigation 

process. 

FEMA Response: FEMA appreciates 

the suggestion for a pre-approved 

project plan and associated cost 

formula. FEMA attempted to streamline 

the process by offering the formula 

presented in the IFR and understands 

there can be advantages to these types 

of schemes to better assist claimants in 

receiving prompt payment. As 

explained above, FEMA is revising the 

language in this paragraph to eliminate 

the 25 percent formula that raised so 

many concerns with commenters. 

However, FEMA is looking at ways to 

better streamline the claims process in 

response to other comments and is 

considering offering payment formulas 

based on specific project types as the 

commenter suggested. For example, 

FEMA is considering a menu of 

potential actions claimants may take for 

heightened risk reduction claims that 

would reduce claim review time and 

streamline payment for those claims. 

Any such type of formula would 

provide claimants with the option to 

either leverage that formula with their 

claim or submit documentation 

detailing their specific damages and 

costs. 

K. Comments on § 296.21(f) Insurance 

and Other Benefits Generally 

Comment: As mentioned above, some 

commenters requested FEMA eliminate 

references to other Federal government 

programs and their use in the claims 

process. Commenters raised general 

concerns about the burden placed on 

claimants to engage in other Federal 

programs and expressed concerns about 

a lack of interagency cooperation. 

FEMA Response: FEMA does not 

intend to require claimants to apply to 

other Federal programs, except for 

FEMA’s Public Assistance program. 

Rather, the language was intended to 

clarify that, where the claimant has 

received payment from another Federal 

program, FEMA will only be able to 

compensate claimants under the Act for 

those costs not covered already in the 

payment received from the other 

Federal program. This avoids a 

duplication of payment for the same 

damage. Claimants have the option of 

seeking assistance from other Federal 

programs, filing for compensation under 

the Act, or pursuing both other Federal 

program and compensation under the 

Act. The language in this section of the 

IFR simply clarifies that FEMA cannot 

duplicate payment but can provide 

additional payment to cover actual 

compensatory damages that were not 

covered by other Federal programs. 

FEMA notes that the IFR only prohibits 

payment under the Act for injuries or 

costs that are eligible under the Public 

Assistance Program. The Act provides 

in section 104(k) to waive the matching 

funds required for Federal programs and 

require that those programs pay the cost 

share directly. This ensures that those 

funds are taken from those Federal 

programs rather than the Act’s funding 

and thus helps further extend the ability 

of the Act to fund compensation for 

claimants. Section 296.21(f)(2) of the 

IFR confirms that FEMA will not pay 

claimants for injuries or costs that are 

eligible under the Public Assistance 

Program but rather that these injuries 

and costs need to be paid through the 

Public Assistance Program and given 

the Act’s provisions, FEMA is required 

to pay those eligible costs at 100 percent 

without a cost share requirement for 

State and local projects. 

As explained above, FEMA is 

coordinating with other Federal 

agencies to ensure data sharing and 

better communication between 

programs. FEMA has engaged with and 

continues to engage with the Small 

Business Administration, the 

Department of Agriculture, and other 

Federal agencies to help facilitate 

coordination of the assistance available 

to claimants and the impacted 

communities. Consistent with the Act’s 

requirements in section 104(g), FEMA is 

consulting with other Federal agencies, 

and State, local, and Tribal authorities 

to ensure the efficient administration of 

the claims process to include ways to 

ensure claimants have the information 

they need regarding Federal programs 

available to them. 

Comment: One commenter requested 

FEMA streamline access to available 

Federal programs and, in addition to 

funds appropriated under the Act, to 

utilize other Federal funding 

opportunities when and where 

available. The commenter asked that 

State Case Managers be integrated into 

the program and trained as Navigators to 

serve as a single point of contact to help 

claimants throughout the process. The 

commenter also requested FEMA reopen 

Federal programs where deadlines may 

have passed to submit applications to 

allow claimants the opportunity to take 

advantage of those programs. 

FEMA Response: FEMA anticipates 

that Claims Navigators will provide the 

assistance envisioned by the commenter 

and additional staffing outside of the 

Claims Office will not be required. 

FEMA is unable to reopen non-FEMA 

Federal programs for claimants but can 

work with claimants regarding Federal 

program availability generally and the 

deadlines associated with FEMAspecific programs. 

1. Comments on § 296.21(f)(1) Insurance 

Comment: Three commenters 

recommended FEMA delete all 

references to insurance companies in 

the regulation. 

FEMA Response: Section 104(d)(1)(C) 

of the Act requires FEMA to reduce the 

amount paid for the claim by the 

amount that is equal to the total of 

insurance benefits and other payments 

or settlements with respect to the claim. 

FEMA does not have the statutory 

authority to delete this requirement. 

Comment: One commenter requested 

FEMA note that if an insurance 

company has not paid all that FEMA 

anticipated, FEMA should commit to 

awarding the difference at the time the 


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authorized official’s determination is 

made. 

FEMA Response: In the preamble to 

the IFR, FEMA stated that the agency 

can award the difference at the time the 

Authorized Official’s determination is 

made. FEMA also noted in the preamble 

that the State of New Mexico generally 

requires insurance companies to settle 

catastrophic claims within 90 days of 

the date the claim was reported, and the 

agency expects that most, if not all, 

insurance claims will be paid before the 

determination is issued. FEMA further 

explained in the IFR preamble that if the 

insurance claim is resolved after the 

determination and the claimant is due 

additional compensation as a result, the 

claim can be reconsidered under 

sections 296.34 or 296.35 of the IFR. 

FEMA believe this process is sufficient 

to resolve the commenter’s concerns 

and no changes to the regulatory text of 

the Final Rule are required. 

Comment: Another commenter stated 

that insurance companies will demand 

compensation for the amounts they have 

paid or will pay to insured claimants 

and found that to be fair. However, the 

commenter stated that greed may 

influence the insurers claims and those 

claims would then negatively affect 

claimant compensation. 

FEMA Response: Section 

104(d)(1)(A)(ii) of the Act requires 

FEMA to place priority on claims 

submitted by injured parties that are not 

insurance companies seeking payment 

as subrogees. Section 296.13 of the IFR 

requires subrogees to file their Notice of 

Loss after they have made all payments 

entitled to the injured person for Firerelated injuries under the terms of the 

insurance policy. FEMA is amending 

§ 296.13 to specifically clarify the 

prioritization required under the Act. 

Further, § 296.21(f) of the regulation 

requires FEMA to compensate injured 

persons only for damages not paid or 

not to be paid by insurance companies. 

As explained above, these provisions, in 

addition to the changes made to 

§ 296.13 of the Final Rule, will help 

ensure that the compensation available 

to injured persons is not negatively 

affected. 

Comment: One individual commenter 

expressed concerns that insurance 

benefits would be impacted by claims 

under the Act and that claims under the 

Act will impact insurance benefits. 

FEMA Response: As explained above, 

Section 104(d)(1)(A)(ii) of the Act 

requires FEMA to place priority on 

claims submitted by injured parties that 

are not insurance companies seeking 

payment as subrogees. Section 296.13 of 

the IFR requires subrogees to file their 

Notice of Loss after they have made all 

payments entitled to the injured person 

for Fire-related injuries under the terms 

of the insurance policy. FEMA is 

amending § 296.13 to specifically clarify 

the prioritization required under the 

Act. Further, § 296.21(f) of the 

regulation requires FEMA to 

compensate injured persons only for 

damages not paid or not to be paid by 

insurance companies. As explained 

above, these provisions, in addition to 

the changes made to § 296.13 of the 

Final Rule, will help ensure that the 

compensation available to injured 

persons is not negatively affected. 

2. Comments on § 296.21(f)(2) 

Coordination With FEMA’s Public 

Assistance Program 

Comment: Some commenters 

requested FEMA remove references to 

the Public Assistance Program as the 

deadlines have passed for that program. 

Other commenters suggested the 

paragraph be reworded from expecting 

claimants to apply for the program to 

encouraging them to do so and to state 

that compensation under the Act will 

not be awarded for damages already 

compensated by FEMA’s Public 

Assistance Program instead of all 

eligible costs. 

FEMA Response: FEMA disagrees 

with the commenters seeking to delete 

this provision of the IFR. FEMA is 

retaining this language in the Final Rule 

as the agency believes it is important to 

clarify that those injuries and costs 

eligible under the Public Assistance 

Program must be paid from that program 

to ensure the funds are used 

consistently with the Act’s provision in 

section 104(k). FEMA understands that 

the Public Assistance application period 

has closed but will continue to accept 

these applications given the Act’s 

requirements. Those entities eligible for 

Public Assistance should continue to 

apply for and seek assistance through 

that program. 

Comment: One commenter requested 

that FEMA, in coordination with the 

New Mexico Department of Homeland 

Security and Emergency Management, 

assist claimants in applying for and 

receiving assistance under the Public 

Assistance Program. 

FEMA Response: As explained above, 

FEMA is coordinating with other 

Federal agencies to ensure data sharing 

and better communication between 

programs. FEMA has engaged with and 

continues to engage with the Small 

Business Administration, the 

Department of Agriculture, and other 

Federal agencies to help facilitate 

coordination of the assistance available 

to claimants and the impacted 

communities. Consistent with the Act’s 

requirements in section 104(g), FEMA is 

in consultation with other Federal 

agencies, and State, local, and Tribal 

authorities to ensure the efficient 

administration of the claims process to 

include ways to ensure claimants have 

the information they need regarding 

Federal programs available to them. 

Comment: A commenter requested 

compensation in several areas that may 

qualify for the Public Assistance 

Program. 

FEMA Response: Any claimant with 

an injury or costs that may be eligible 

for Public Assistance should apply for 

Public Assistance. FEMA understands 

that the Public Assistance application 

period has closed but will continue to 

accept these applications given the Act’s 

requirements. 

3. Comments on § 296.21(f)(3) Benefits 

Provided by FEMA’s Individual 

Assistance Program 

Comment: One commenter requested 

that FEMA amend this section to make 

clear that if FEMA only partially 

compensated a claimant for injuries or 

costs under the Individual Assistance 

Program that the Claims Office will 

compensate the remainder of costs and 

injuries under the Act. 

FEMA Response: FEMA does not 

believe the language in the IFR requires 

revision on this point. The current 

language provides that FEMA will not 

award compensation under the Act for 

those injuries or costs that have been 

reimbursed under the Individual 

Assistance program. This language 

necessitates that those injuries or costs 

that have not been fully reimbursed are 

eligible under the Act for compensation. 

FEMA is not making any changes to the 

Final Rule in this paragraph given the 

current language is sufficiently clear. 

Comment: Two commenters requested 

FEMA clarify that temporary emergency 

support and sheltering, as well as 

temporary housing costs provided by 

FEMA should be considered in addition 

to the Act’s funding and should not 

impact an individual claim. 

FEMA Response: FEMA disagrees 

with these commenters. FEMA cannot 

pay for temporary housing costs under 

the Act if the individual has already 

received payment for these expenses 

under the Individual Assistance 

program as this would result in a 

duplication of payment. These costs, 

however, would not be deducted from a 

real property claim. Thus, if a claimant 

obtained a temporary housing unit 

through FEMA’s Individual Assistance 

program but sought compensation to 

rebuild their home after the Fire, FEMA 

would fully compensate the claimant for 

the costs associated with rebuilding 


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their home and would not deduct the 

costs associated with the claimant’s 

time in the temporary housing unit from 

the claim as these are distinct costs. 

L. Comments on Claims Evaluation 

1. Comments on § 296.30(a) Burden of 

Proof 

Comment: Commenters raised a range 

of concerns about this paragraph. 

Several commenters requested that 

FEMA consider alternative ways of 

demonstrating ownership, particularly 

given the multigenerational landowners 

in the region and lack of availability of 

real estate sale amounts in the public 

record in New Mexico. A commenter 

suggested FEMA pay attention to 

uninsured claimants and those without 

‘‘proper’’ paperwork, particularly those 

multigenerational landowners. A 

different commenter stated that sale 

prices, appraisals, and mortgage 

amounts were not public information in 

New Mexico, asking how claimants 

seeking to prove the value of their land 

would get that information. 

FEMA Response: The burden of proof 

remains with the claimant to 

demonstrate injuries resulting from the 

Fire, but, as explained above, the Claims 

Office locally hired Navigators to assist 

claimants compiling necessary 

documentation and completing the 

proof of loss in support of the claim. 

When necessary, the Claims Office can 

fund appraisals, surveys, or other data 

collections efforts to aid the claimant in 

proving value or ownership of property. 

Further, as explained in § 296.30(a), 

FEMA may compensate a claimant for 

an injury in the absence of supporting 

documentation on the strength of other 

documentary evidence and an affidavit 

executed by the claimant. Claims Office 

staff are aware of issues surrounding 

proof of ownership for land and will 

work with each claimant to determine 

alternate methods in determining 

ownership when deeds are not 

available. FEMA will work with 

claimants on this issue and allow 

claimants the flexibility to extend the 

deadline for submission of the Proof of 

Loss where good cause to do so is 

found. 

Comment: A commenter requested 

claims be assumed to be reasonable and 

true with the burden of proof on the 

Federal government to disprove the 

claim, stating that claimants should be 

allowed to ‘‘self-certify’’ their claims. 

One commenter wrote that claims 

should be assumed reasonable and true, 

and that the burden of proof should be 

on the Federal government to disprove 

the claim. This commenter also 

suggested that claimants should be 

allowed to self-certify their claims 

under the penalty of law. 

FEMA Response: The burden of proof 

remains with the claimant to 

demonstrate injuries resulting from the 

Fire. FEMA has a legal responsibility to 

ensure that funds appropriated for 

claims under the Act are used to pay 

valid claims. The agency cannot assume 

that all claims are reasonable and true 

without appropriate supporting 

documentation, as such a process would 

open the Act’s funding to significant 

fraud and abuse. To ensure the Act’s 

funds are properly paid to claimants 

that suffered injuries as a result of the 

Fire, FEMA must review supporting 

documentation associated with each 

claim. As explained in § 296.30(a), 

FEMA may compensate a claimant for 

an injury in the absence of supporting 

documentation on the strength of other 

evidence and affidavits executed by the 

claimant and others. 

Comment: Other commenters also 

requested the burden be placed on 

FEMA to research their claims and if the 

burden was not shifted to FEMA, that 

claimants should be able to utilize their 

own experts to assist with their claim 

and should be reimbursed for the 

expert’s costs. 

FEMA Response: As stated above, the 

burden of proof remains with the 

claimant to demonstrate injuries 

resulting from the Fire. As explained in 

§ 296.30(a), FEMA may compensate a 

claimant for an injury in the absence of 

supporting documentation on the 

strength of other evidence and affidavits 

executed by the claimant and others. 

Additionally, § 296.31(a) provides for 

the use of experts in the process. FEMA 

is revising the IFR language regarding 

expenses for experts as detailed below 

to help address this and other 

commenters’ concerns about the use of 

experts and the costs associated with 

doing so. FEMA will work with 

claimants on this issue and allow 

claimants the flexibility to extend the 

deadline for submission of the Proof of 

Loss where good cause to do so is found 

pursuant to § 296.30(b). FEMA also 

provides flexibility in supplementing 

and reopening claims as detailed in 

sections 296.34 and 296.35. 

Comment: One commenter stated that 

while they understood that providing 

proof of ownership was necessary and 

important for good governance of the 

funds provided in the Act, they had 

concerns that the burden of proof would 

be overly burdensome and difficult for 

some claimants. The commenter 

recommended FEMA be flexible in 

determining what documentation is 

required. 

FEMA Response: As explained above, 

the burden of proof remains with the 

claimant to demonstrate injuries 

resulting from the Fire. As discussed 

above, the Claims Office locally hired 

Navigators to assist claimants compiling 

necessary documentation and 

completing the proof of loss in support 

of the claim. Further, as explained in 

§ 296.30(a), FEMA may compensate a 

claimant for an injury in the absence of 

supporting documentation on the 

strength of other evidence and 

affidavits. Claims Office staff are aware 

of issues surrounding proof of 

ownership for land and will work with 

each claimant to determine alternate 

methods in determining ownership 

when deeds are not available such as 

affidavits, utility bills and tax records. 

FEMA will work with claimants on this 

issue and allow claimants the flexibility 

to extend the deadline for submission of 

the Proof of Loss where good cause to 

do so is found. The goal of the claims 

process is to reduce complexity and 

provide assistance with the claims 

process to the extent possible. 

2. Comments on § 296.30(b) Proof of 

Loss 

Comment: One commenter requested 

that claimants be able to ‘‘self-certify’’ 

their claims under penalty of perjury. 

FEMA Response: The burden of proof 

remains with the claimant to 

demonstrate injuries resulting from the 

Fire. As explained above, FEMA has a 

legal responsibility to ensure that funds 

appropriated for claims under the Act 

are used to pay valid claims. The agency 

cannot assume that all claims are 

reasonable and true without appropriate 

supporting documentation, as such a 

process would open the Act’s funding to 

significant fraud and abuse. To ensure 

the Act’s funds are properly paid to 

claimants that suffered injuries as a 

result of the Fire, FEMA must review 

supporting documentation associated 

with each claim. FEMA does currently 

require that claimants submit claims 

under penalty of perjury to help reduce 

the potential for fraud, but the agency is 

unable to allow for self-certification of 

claims to ensure the good governance of 

the Act’s funds. As explained in 

§ 296.30(a), FEMA may compensate a 

claimant for an injury in the absence of 

supporting documentation on the 

strength of other evidence and affidavits 

executed by the claimant and others. 

Comment: Commenters raised 

questions about the deadline for 

submitting a Proof of Loss. Commenters 

felt the 150-day period was too short 

with some commenters stating they may 

not have information on what damages 

would be covered by insurance or other 


ddrumheller on DSK120RN23PROD with RULES4
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54See OMB Control No. 1660–0155 found at 

https://www.reginfo.gov/public/do/ 

PRAViewICR?ref_nbr=202211-1660-001 (last 

accessed Mar. 1, 2023). 

55See OMB Control No. 1660–0155 revision 

found at https://www.reginfo.gov/public/do/ 

PRAViewICR?ref_nbr=202302-1660-001 (last 

accessed Mar. 1, 2023). 

Federal and State government programs 

within that timeframe. Some 

commenters suggested the time frame to 

provide proof of loss be extended to no 

less than 270 days, especially in cases 

where expert opinions/reports were 

needed for the claim. 

FEMA Response: As the preamble to 

the IFR explained, claimants are 

required to submit their Proof of Loss 

within 150 days of submission of their 

Notice of Loss. Section 104(d)(1)(A)(i) of 

the Act states that FEMA must 

determine the compensation due to a 

claimant within 180 days of the date 

upon which the Notice of Loss is filed. 

To ensure FEMA meets this mandate, 

claimants need to provide specific 

details about their injuries by signing 

the Proof of Loss. FEMA recognizes the 

challenges with these deadlines and 

intends to allow extensions where such 

extensions are for the claimants’ benefit. 

Claimants who submit their Notice of 

Loss should submit a signed Proof of 

Loss to the Claims Office not later than 

150 days after the initial Notice of Loss 

was submitted. Adherence to this 

deadline will leave FEMA with 30 days 

to determine the compensation due to 

the claimant and enable the agency to 

meet the 180-day timeframe required by 

Congress. FEMA also provides that this 

deadline may be extended for good 

cause at the discretion of the Director of 

the Claims Office. 

Comment: Some commenters wrote 

they would be required to submit a 

Proof of Loss Form with extensive 

supporting documentation by April 14, 

2023 if the Notice of Loss was submitted 

as early as November 15, 2022 under the 

timeline provided in the IFR. These 

commenters stated this was unfair as 

FEMA had not made available a Proof 

of Loss Form. These commenters 

recommended a 250-day timeline to 

submit a Proof of Loss. 

FEMA Response: As explained above, 

claimants are required to submit their 

Proof of Loss within 150 days of 

submission of their Notice of Loss. 

Section 104(d)(1)(A)(i) of the Act states 

that FEMA must determine the 

compensation due to a claimant within 

180 days of the date upon which the 

Notice of Loss is filed, which is the date 

the Notice of Loss is acknowledged by 

the Claims Office. FEMA would be 

unable to fulfill this mandate if 

claimants do not provide specific details 

about their injuries by signing the Proof 

of Loss. FEMA recognizes the challenges 

with these deadlines and intends to 

allow extensions where such an 

extension is for the claimant’s benefit. 

Claimants who submit their Notice of 

Loss should submit a signed Proof of 

Loss to the Claims Office not later than 

150 days after the initial Notice of Loss 

was acknowledged. Adherence to this 

deadline will leave FEMA with 30 days 

to determine the compensation due to 

the claimant and enable the agency to 

meet the 180-day timeframe required by 

Congress. FEMA also provides that this 

deadline may be extended for good 

cause at the discretion of the Director of 

the Claims Office. FEMA notes that the 

agency completed an emergency 

information collection associated with 

the IFR for the Notice of Loss and Proof 

of Loss forms in November 2022.54

Those forms were revised in February 

2023.55

Comment: Two commenters raised 

concerns about the 150-day deadline for 

claimants to submit their Proof of Loss, 

stating FEMA had an additional 180 

days to respond to claims. One of the 

commenters wrote ‘‘Also interesting is 

how 120-day response time limits are 

placed on Hermit’s Peak Fire victims 

while HPFAA Administrators and 

Reviewers and such have 180-day limits 

to respond to victims submitted claims/ 

amendments and such while they are all 

drawing cushy government pay checks 

the entire time they spend on claims 

assessment, judgement and payment.’’ 

FEMA Response: FEMA disagrees 

with the commenters’ interpretation of 

the timeline provided in the IFR. 

Claimants are required to submit their 

Proof of Loss within 150 days of 

submission of their Notice of Loss. 

Section 104(d)(1)(A)(i) of the Act states 

that FEMA must determine the 

compensation due to a claimant within 

180 days of the date upon which the 

Notice of Loss is filed. This timeline 

gives FEMA 30 days to process the Proof 

of Loss to issue a determination on the 

claim. Claimants who submit their 

Notice of Loss should submit a signed 

Proof of Loss to the Claims Office not 

later than 150 days after the initial 

Notice of Loss was submitted to ensure 

the Congressional mandate for FEMA to 

process claims within 180 days can be 

met. 

Comment: A commenter requested the 

deadline for the Proof of Loss submittal 

be relative to the Notice of Loss 

Acknowledgement date, not relative to 

the Notice of Loss submittal date. The 

commenter requested that the deadline 

for Proof of Loss submittal should be 

made relative to the Notice of Loss 

acknowledgement date, not relative to 

the Notice of Loss submittal date like it 

says in the handouts. Another 

commenter, however, commented that 

FEMA must pay claims within 180 days 

and that the 180-day clock must begin 

when the claim is filed, not based on a 

FEMA-determined milestone after the 

claim. 

FEMA Response: The IFR in 

§ 296.30(b) currently provides that the 

requirement to submit the Proof of Loss 

is 150 days from the date the Notice of 

Loss was submitted. This language is 

sufficiently clear without change, as 

FEMA has explained in additional 

guidance that ‘‘submitted’’ under the 

regulation is the date FEMA 

acknowledges receipt of the Notice of 

Loss. Further, § 296.10(f) explains that a 

Notice of Loss is deemed to be filed on 

the date it is received and 

acknowledged by the Claims Office. 

FEMA is thus not changing the Final 

Rule language. The language in the IFR 

is consistent with the Act’s requirement 

to pay claimants within 180 days of the 

claim’s submittal. FEMA does not 

believe a Notice of Loss can be 

submitted until it has been reviewed for 

sufficiency and receipt has been 

acknowledged by FEMA. This review 

and acknowledgement of receipt 

benefits the claimant. FEMA heard 

commenters above expressing concerns 

with the timeline to submit a Proof of 

Loss and while the agency is limited in 

its ability to extend that timeframe, 

allowing FEMA the time to review the 

Notice of Loss and issuing an 

acknowledgement before starting the 

150-day timeline by which claimants 

must submit their Proof of Loss allows 

FEMA to identify any initial challenges 

with the claim and provide the claimant 

with initial guidance to update the 

Notice as required in advance of starting 

to work on the Proof of Loss resulting 

in a better overall claim and a more 

efficient review of that claim. 

Comment: One commenter asked that 

the Proof of Loss be an iterative process 

between FEMA and the claimant, 

allowing claimants to supplement the 

Proof of Loss as appropriate. 

FEMA Response: FEMA agrees. In 

§ 296.5, FEMA explains the process will 

involve Claims Reviewers working with 

claimants to assist in developing a 

strategy to obtain the documentation 

required for their claim. FEMA 

anticipates Claims Reviewers will 

engage with claimants to ensure the 

Proof of Loss is as comprehensive as 

possible at the time of submission. 

Further, Section 296.34 explains the 

process to supplement claims after 

submission of a Proof of Loss. 


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56See Public Law 117–180, Division A, Section 

136 (2022). 

3. Comments on § 296.30(c) Release and 

Certification Form 

Comment: One commenter wrote 

about the feasibility of waiving future 

claims given the extent of damages, 

losses, and expenses may not be fully 

known at the time of the award. The 

commenter wrote that the full extent of 

damages, losses, and expenses may not 

be known at the time of award, and it 

was beyond anyone’s ability to foretell 

those future damages to claim them on 

their Notice of Loss. The commenter 

suggested FEMA allow a lump sum 

payment of 15 percent of all injury, 

damages, losses, and expenses to be 

added on to each claim to cover for 

these future unknown items to resolve 

this concern. 

FEMA Response: FEMA understands 

the concerns with waiving rights to 

pursue further claims after accepting a 

final award, but section 104(e) of the 

Act requires that payment made be final 

and conclusive with respect to all 

claims on the same subject matter and 

that such payment constitute a full 

release of all claims against the United 

States on the same subject matter. 

FEMA is bound by this statutory 

language to require a release for all final 

payments. As explained in § 296.30(b), 

the deadline to submit a Proof of Loss 

may be extended for good cause. 

Additionally, sections 296.34 and 

296.35 allow claimants to supplement 

and/or reopen claims. FEMA recognizes 

the latest deadline for these actions is 

November 14, 2025; however, this 

deadline is consistent with the Agency’s 

statutory authority and FEMA does not 

have the authority to further extend this 

deadline. Claims related to future 

damages as a result of the Fire would 

need to be made through other remedies 

as the Act sets a two-year limitation for 

claims under the Act. FEMA is unable 

to pay lump sum payments to cover 

future unknown injuries, as unknown 

injuries are speculative in nature and 

the Act requires FEMA to pay for actual 

compensatory damages. 

Comment: A commenter stated that a 

claimant’s right to civil action or other 

redress should not be waived or limited 

until a final payment has been agreed to 

with FEMA and that it must be clear to 

claimants at what point(s) in the process 

they are waiving their rights to further 

legal action as well as how they can 

retain their right to further legal action 

for different types of subject matter. 

FEMA Response: An injured person 

who accepts an award under the Act 

waives the right to pursue any claims 

arising out of or relating to the same 

subject matter under the Federal Tort 

Claims Act or a civil lawsuit. Similarly, 

those claimants who accept an award 

under the Federal Tort Claims Act or a 

civil lawsuit waive the right to pursue 

claims under the Act. Until the final 

award payment is accepted, the 

claimant may pursue any and/or all of 

the options available. This flexibility 

would allow for injured persons to 

pursue different avenues of 

compensation until a final award is 

accepted. To ensure this is clear in the 

Final Rule, FEMA is revising paragraphs 

(a) and (b) of § 296.12 to clarify that the 

injured person only waives the right to 

pursue these options upon acceptance 

of a final award. 

Comment: A commenter requested 

FEMA not seek to recover possible 

overpayments where FEMA has made a 

material mistake, or to establish a 

specific, short window of time after the 

Release is signed and denote a value for 

which it would recover. The commenter 

wrote that allowing FEMA to recover 

overpayments when a material mistake 

was made could lead to a culture of 

distrust in which claimants were 

reluctant to seek damages due to a fear 

that if the agency made a mistake, the 

claimant could be held liable for 

repayment. The commenter 

recommended FEMA either not recover 

possible overpayments, or to establish a 

specific, short window of time after the 

Public Release is signed and denote a 

value for which it would recover. 

Another commenter agreed, stating 

FEMA’s reclamation of costs due to an 

administrative mistake could jeopardize 

local trust in the program and should be 

disallowed or limited to extremely rare 

and clearly defined circumstances. One 

commenter stated that once FEMA has 

made a payment to the claimant, any 

errors made by FEMA should not be 

recoverable. 

FEMA Response: FEMA appreciates 

the concerns raised by these 

commenters, but the agency is legally 

obligated to recover funding issued in 

error. The Act limits compensation to 

actual damages incurred as a result of 

the Fire. If the claimant was not injured 

or did not suffer damages as a result of 

the Fire and payment is made, such 

payment is not compensation for actual 

compensatory damages. FEMA is legally 

obligated to recover funds paid in 

situations of civil or criminal fraud, 

misrepresentation, presentation of a 

false claim, and where the claimant was 

not eligible for partial payment under 

the Act. FEMA considers partial 

payments made where the claimant was 

not eligible for the compensation to be 

a material mistake in § 296.30(d). FEMA 

also notes that Congress provided 

appropriations for the Department of 

Homeland Security’s Office of the 

Inspector General for oversight of 

activities authorized by the Act, 

including oversight of payments made 

in error.56

M. Comments on Reimbursement of 

Claims Expenses 

1. Comments on § 296.31(a) Expert 

Opinions 

Comment: Commenters generally 

opposed the requirement that FEMA 

request an appraisal or other third-party 

opinion before such an expense could 

be reimbursed under the Act. Most 

commenters requested FEMA delete the 

requirement that FEMA request the 

appraisal or opinion. Commenters stated 

they would not be made whole if they 

were not reimbursed for expert 

opinions. 

FEMA Response: FEMA heard 

commenters’ concerns regarding this 

provision in the IFR and is making 

changes to the Final Rule. Specifically, 

the IFR language only allows for 

reimbursement if requested by the 

Claims Office. FEMA is revising this 

paragraph in the Final Rule to allow for 

reimbursement for reasonable costs 

incurred in providing appraisals or 

other third-party opinions that the 

Claims Office deems necessary to 

determine the amount of the claim. 

FEMA recognizes the size and scope of 

this Fire, along with the geographic, 

economic, and cultural distinctions 

between this Fire and the Cerro Grande 

Fire, may result in claimants having to 

rely more frequently on expert opinions 

in their claims process and is updating 

the Final Rule to reflect this need. This 

revision will allow claimants to seek 

reimbursement for reasonable costs 

incurred in obtaining expert opinions 

that the Claims office reviews and 

agrees are necessary to determine the 

amount of the claim. This revision in 

the Final Rule provides more flexibility 

to claimants to seek expert opinions as 

part of the claims process while also 

retaining good governance of the use of 

the Act’s funds to those opinions that 

are necessary to effectively determine 

the claim amount. 

Comment: Commenters stated that 

New Mexico law allowed for 

compensation for expert opinions and 

that given the complexity of the claims 

process, claimants needed experts to 

help value their claims. 

FEMA Response: As explained above, 

FEMA is revising this paragraph in the 

Final Rule to allow for reimbursement 

for reasonable costs incurred in 

providing appraisals or other third-party 

opinions that the Claims Office deems 


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necessary to determine the amount of 

the claim. This revision will allow 

claimants to seek reimbursement for 

reasonable costs incurred in obtaining 

expert opinions that the Claims office 

reviews and agrees are necessary to 

determine the amount of the claim. 

Comment: One commenter noted that 

there are very few appraisers or title 

companies in the area. 

FEMA Response: FEMA acknowledges 

the lack of experts in the area and 

anticipates working with claimants to 

obtain appropriate resources for these 

needed opinions. 

Comment: Another commenter stated 

that many claimants had already 

incurred costs for obtaining expert 

opinions and stated reimbursement for 

those expenses would acknowledge that 

the recovery process did not start when 

the Claims Office launched, but well in 

advance. Several commenters agreed 

that FEMA should exercise discretion to 

pay the reasonable costs of expert 

services obtained prior to the IFR’s 

publication. 

FEMA Response: FEMA considered 

this approach when making the decision 

to revise the language to this paragraph 

of the Final Rule. However, FEMA felt 

this deadline would not fully address 

most commenters’ concerns with the 

ability to effectively value their claim on 

their own and the need for experts to 

assist. The revision to the Final Rule to 

allow reasonable costs for these 

opinions that the Claims Office agrees 

are necessary regardless of when the 

opinion was requested will provide 

more flexibility to claimants to seek 

expert opinions as part of the claims 

process while also retaining good 

governance of the use of the Act’s funds 

to those opinions that are necessary to 

effectively determine the claim amount. 

Comment: A commenter requested 

that FEMA make available technical 

assistance and expert services to 

claimants, including arborists, 

surveyors, appraisers/adjusters, and 

engineers to help with the most 

common losses. 

FEMA Response: FEMA agrees and 

will work with claimants to identify 

appropriate resources to assist with 

valuing claims as explained above. 

Comment: One commenter requested 

compensation for a Habitat Equivalency 

Analysis and GIS mapping as necessary 

to prove loss in the most accurate way. 

One commenter suggested FEMA 

provide claimants with access to all 

after-wildfire high-resolution aerial 

imagery of the Fire area to determine the 

extent of the damage more accurately to 

private forestlands as well as 

surrounding forestlands, stating the 

most recent imagery is insufficient. 

FEMA Response: FEMA recommends 

claimants seeking compensation for 

expert opinions or resources submit 

their claim for reimbursement 

explaining why the opinion and/or 

resource was required to effectively 

value their claim. As explained above, 

if claimants are having difficulty 

obtaining these opinions and/or 

resources, FEMA will work with the 

claimant to assist in locating the 

resources needed to effectively value 

their claim. 

2. Comments on § 296.31(b) Lump Sum 

Payments for Incidental Expenses 

Comment: Several commenters 

requested that FEMA pay for all 

expenses associated with the claims 

process, removing the exclusion for 

damages for time spent prosecuting a 

claim in § 296.21(b) and changing the 

lump sum payment in paragraph (b) to 

allow for full recoupment of all 

expenses, including time. Some 

commenters focused in on specific 

incidental expenses, requesting 

reimbursement for expenses such as 

travel expenses and replacement of 

documents. 

FEMA Response: As explained in the 

IFR, compensatory damages for time 

spent in claims preparation are not 

considered actual compensatory 

damages. There is no evidence Congress 

intended that claimants be compensated 

for the value of their time in preparing 

a claim. Providing compensation for a 

claimant’s time would be difficult to 

administer, as FEMA would have to 

determine equitably the value of a 

claimant’s time and to verify that 

claimants have expended the number of 

hours that are claimed. FEMA’s 

payments under the Act are subject to 

independent audit by the GAO and the 

DHS OIG and claimants would likely 

find attempts by auditors to verify the 

payment for hours spent in the claims 

process highly intrusive. Additionally, 

the type of compensation requested by 

commenters here would require 

production of receipts and other 

documentation, resulting in an overly 

burdensome process for this payment to 

claimants contrary to other comments 

requesting the agency streamline and 

simplify the claims process. As 

explained in the IFR, FEMA is choosing 

to exercise discretion to provide a lump 

sum payment to claimants for 

miscellaneous and incidental expenses 

incurred in the claims process. FEMA 

will provide a lump sum payment of 

five percent of the insured and 

uninsured loss (excluding flood 

insurance premiums), not to exceed 

$25,000. The minimum lump sum 

payment is $150. Section 296.31(b) of 

the IFR represents a fair and reasonable 

accommodation between the agency’s 

responsibility to spend Federal funds 

wisely and the desire to compensate 

claimants as fully as possible. 

Comment: One commenter suggested 

FEMA partner with a trusted local 

financial institution to carry out 

payment of approved claims expense 

reimbursements to help ensure prompt, 

complete, and correct payments to 

approved claimants. 

FEMA Response: The current claims 

process requires claimants to provide 

FEMA with information on how they 

want to be paid, either by electronic 

funds transfer or check. No third-party 

financial institution is required for these 

transactions. 

Comment: Two commenters 

recommended that subrogation 

claimants and those claimants whose 

only Fire-related loss is for flood 

insurance premiums should be eligible 

if their property was not previously 

designated in a flood zone but is now 

considered to be in one as a result of the 

Fire. 

FEMA Response: FEMA disagrees that 

these claimants should be eligible for a 

lump sum payment for incidental 

expenses incurred in their claims 

preparation. Subrogees are generally 

insurance companies, and their industry 

involves claims review and preparation. 

These entities have no legal right to 

pursue expenses for claims preparation. 

The burden placed on those claimants 

only seeking flood insurance premiums 

is minimal, as the only claim made is 

for flood insurance premiums and the 

documentation needed to support such 

a claim would be very limited compared 

to other claims. To ensure the funding 

provided under the Act is utilized to 

compensate claimants as fully as 

possible while also ensuring Federal 

funds are wisely spent, these claimants 

should not be eligible for a lump sum 

payment for incidental expenses. FEMA 

is retaining the language in paragraph 

(b) in the Final Rule making these types 

of claimants ineligible for the lump sum 

payment. 

N. Comments on §§ 296.34 and 296.35 

Supplementing Claims and Reopening a 

Claim 

1. Comments on § 296.34 

Supplementing Claims 

Comment: A few commenters sought 

clarification and/or revision to this 

section of the IFR. One commenter 

asked if claimants made an error 

whether they were allowed to file again. 

FEMA Response: As explained in the 

IFR, there is flexibility built into the 

process for claimants to tell FEMA 


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about injuries and damages that they 

could not have discovered or did not 

remember when they signed the Notice 

of Loss or Proof of Loss. This may also 

include situations where a claimant 

makes an inadvertent error. Sections 

296.34 and 296.35 explain this 

flexibility. Section 296.34 allows 

claimants to supplement their claim by 

working directly with a Claims 

Reviewer prior to submitting their Proof 

of Loss. If a claimant is not prepared to 

sign a Proof of Loss within the 

timeframe required, an extension may 

be requested from the Director of the 

Claims Office. Alternatively, the 

claimant may withdraw the claim and 

re-file the claim before November 14, 

2024. Once the Proof of Loss is filed, a 

claimant can request to supplement 

their claim by writing to the Director of 

the Claims Office providing the reasons 

why the claim needs to be 

supplemented. The claimant should 

consult with the Claims Reviewer about 

the procedure for obtaining permission 

from the Director of the Claims Office. 

Comment: Several commenters 

requested FEMA update the 

supplementing claims section of the 

regulation to simplify the process for 

supplementing claims and eliminate 

references to the Administrative 

Appeals process. These commenters 

wrote that requiring claimants to 

supplement a claim pursuant to 

comparatively complex adjudicatorylike procedures undermined FEMA’s 

intent to create a simple claims process 

that is sensitive to the burdens already 

placed upon claimants by the Fire. 

FEMA Response: FEMA disagrees 

with the commenters’ suggestion that 

incorporating language on the 

Administrative Appeals process in this 

section of the regulation complicates the 

process. Section 296.34 allows 

claimants to supplement their claim by 

working directly with a Claims 

Reviewer prior to submitting their Proof 

of Loss. If a claimant is not prepared to 

sign a Proof of Loss within the 

timeframe required, an extension may 

be requested from the Director of the 

Claims Office. Once the Proof of Loss is 

filed, a claimant can request to 

supplement their claim by writing to the 

Director of the Claims Office providing 

the reasons why the claim needs to be 

supplemented. The claimant should 

consult with the Claims Reviewer about 

the procedure for obtaining permission 

from the Director of the Claims Office. 

The Director of the Claims Office will 

then directly review the additional 

claim consistent with how the Director 

reviews claims in the Administrative 

Appeal process. By providing for the 

procedures used in the Administrative 

Appeal process, FEMA ensures that the 

supplemental claims information is 

reviewed directly by the Director after 

the Authorized Official’s determination 

is issued on the remainder of the claim. 

If the claimant decides to appeal the 

Authorized Official’s determination on 

other injuries, the Director of the Claims 

Office will decide both matters in a 

single appeal proceeding to expedite 

processing. Alternatively, the claimant 

may withdraw the claim and re-file the 

claim once before November 14, 2024, 

when the injuries are better defined. 

The process provided for in § 296.34 is 

sufficient and not overly burdensome on 

the claimant. 

Comment: A commenter requested 

that FEMA allow claims to be reopened 

and supplemented in response to future 

flooding events. 

FEMA Response: As explained above, 

there is flexibility built into the process 

for claimants to tell FEMA about 

injuries and damages that they could 

not have discovered or did not 

remember when they signed the Proof of 

Loss, including future flooding events. 

Sections 296.34 and 296.35 allow 

claimants to supplement and/or reopen 

claims respectively. 

2. Comments on § 296.35 Reopening a 

Claim 

Comment: A few commenters sought 

clarification and/or revision to the 

reopening claims section of the IFR. 

Most of these commenters were 

concerned about the deadline to reopen 

a claim, stating additional damages may 

be experienced. One commenter asked 

how to proceed where their claim is 

paid, and they then suffer additional 

damages from flooding seeking 

clarification on whether they should file 

another Notice of Loss. 

FEMA Response: FEMA recognizes 

that damages may continue beyond the 

deadline for submitting a claim. The 

agency is generally bound by the Act’s 

requirements for claims to be submitted 

within two years of the IFR’s 

publication. In the IFR, FEMA allows 

for claimants to reopen their claims for 

up to an additional year after submitting 

their initial claim. 

Comment: One commenter requested 

that FEMA allow a lump sum payment 

of 15 percent of all injuries, damages, 

losses, and expenses to be added on to 

each claim to cover for future unknown 

items. 

FEMA Response: As explained above, 

FEMA recognizes that damages may 

continue beyond the deadline for 

submitting a claim. The agency is 

generally bound by the Act’s 

requirements for claims to be submitted 

within two years of the IFR’s 

publication. In the IFR, FEMA allows 

for claimants to reopen their claims for 

up to an additional year after submitting 

their initial claim. Claims related to 

future damages as a result of the Fire 

would need to be made through other 

remedies as the Act sets a two-year 

limitation for claims under the Act. 

FEMA is unable to pay lump sum 

payments to cover future unknown 

injuries, as unknown injuries are 

speculative in nature and the Act 

requires FEMA to pay for actual 

compensatory damages. To the extent 

that a claimant is able to reasonably 

quantify expected future losses, future 

losses are compensable. 

Comment: Two commenters 

recommended FEMA insert ‘‘real 

property’’ in place of ‘‘home’’ in this 

section to ensure that this clause is not 

limited to homes but includes all real 

property. 

FEMA Response: FEMA concurs with 

this recommendation and is amending 

the IFR language that limits the close of 

the sale to a home. FEMA agrees with 

commenters that changing the language 

to address the sale of real property 

instead of a home is more appropriate 

and is revising § 296.35 to reflect that 

those claimants could reopen a claim if 

they closed on the sale of real property 

and wish to present a claim for a 

decrease in the value of the real 

property under § 296.21(c)(3). This 

change is consistent with concerns 

raised by commenters that the Cerro 

Grande Fire Assistance process was not 

necessarily appropriate to this Fire 

given the distinct geographic, economic, 

and cultural considerations of the 

impacted communities. As explained 

above, this Fire impacted significant 

forested areas and more rural areas than 

the Cerro Grande Fire. This change in 

the Final Rule more appropriately 

reflects the Hermit’s Peak/Calf Canyon 

Fire claimants’ needs by including all 

real property. 

Comment: Several commenters 

requested FEMA update this section of 

the regulation, providing specific 

suggestions to revise the section on 

reopening claims to separate out claims 

for heightened risk reduction, the sale of 

real property, reconstruction, and good 

cause, as well as providing an openended deadline for submission of 

reopened claims allowing a deadline to 

be set in the future via a Federal 

Register notice. 

FEMA Response: Section 296.35 

provides for reopening a claim after the 

claimant has submitted a Release and 

Certification Form again with the goal to 

allow claimants an opportunity to 

request damages in excess of those 

previously awarded. Claimants can use 


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57See Sections 104(h)(1)(B) and 104(h)(1)(C) of 

the Act. 

the reopening provision of this section 

to seek compensation for an injury not 

previously reported to FEMA in 

circumstances where claimants seek 

heightened risk reduction compensation 

under § 296.21(e)(5); the claimant closed 

the sale of a home and wishes to present 

a claim for a decrease in the value of the 

real property under § 296.21(c)(3); the 

claimant has incurred additional losses 

under § 296.21(c)(1) as part of a 

reconstruction in excess of those 

previously awarded; or where the 

Director of the Claims Office determines 

good cause exists to reopen the claim. 

While FEMA does not believe the 

current language in the IFR needs to be 

restructured as these commenters 

suggested in the Final Rule, FEMA 

recognizes that damages may continue 

beyond the deadline for submitting a 

claim. FEMA plans to consider and 

incorporate future losses into the claims 

valuation methodology, where 

appropriate. In the IFR, FEMA allows 

for claimants to reopen their claims for 

up to an additional year after submitting 

their initial claim. FEMA is revising 

§ 296.35 consistent with the 

commenter’s request to use the Cerro 

Grande process to extend the deadline 

where reconstruction costs under 

§ 296.21(c)(3) exceed the previously 

paid claim or for good cause. FEMA will 

issue notice in the Federal Register and 

at https://www.fema.gov/hermits-peak 

of this future deadline. FEMA believes 

this change is consistent with the prior 

Cerro Grande process and will help 

ensure claimants are compensated for 

their actual damages as a result of the 

Fire. 

3. Comments on § 296.37 

Confidentiality of Information 

Comment: One commenter stated the 

Federal government is responsible for 

providing the right to privacy to 

claimants. One commenter raised 

concerns about privacy violations with 

local hires. 

FEMA Response: FEMA agrees that 

the Federal government is responsible 

for ensuring confidentiality for private 

information submitted by claimants. 

Section 296.37 provides that 

confidential information submitted by 

individual claimants is protected from 

disclosure to the extent permitted by the 

Privacy Act. The Privacy Act protects 

the confidentiality of information 

provided by individual claimants. This 

information may only be disclosed with 

the consent of the claimant or pursuant 

to a routine use, which has been 

disclosed to the public. Confidential, 

proprietary, and trade secret 

information provided by entities, such 

as business, Indian Tribes, Tribal 

entities, and government agencies, are 

not eligible for Privacy Act protection, 

but may be exempt from disclosure 

under the Freedom of Information Act. 

All FEMA employees are obligated to 

follow the Privacy Act requirements, 

whether they are local hires or not and 

FEMA will ensure that all employees 

receive appropriate training on the 

Privacy Act. 

O. Comments on § 296.41 

Administrative Appeal 

Comment: Commenters raised 

concerns and questions about the 

appeals process provided in § 296.41. 

Some commenters asked for more detail 

in the regulation regarding the appeals 

process. A commenter wrote that the 

regulations were unclear as they did not 

outline under which circumstances a 

victim could appeal FEMA’s decision, 

nor a timeline of the appeals process. 

The commenter asked that if a claimant 

wished to appeal, must the claimant 

appeal the entire award, or could the 

appeal be limited to the portion of the 

award to which the claimant objects. 

The commenter also asked if a claimant 

wished to have their case heard in the 

United States District Court, did that 

mean that the claimant had to file a 

Federal Tort Claim and begin the 

process from square one, or would the 

District Court review the award given by 

FEMA for legal error and the standard 

of review if heard by the District Court. 

The commenter further asked if there 

would there be an opportunity for 

appellate review thereafter. 

FEMA Response: The current 

regulatory text is sufficient to provide 

claimants with a general understanding 

of the process and that details of the 

process are more appropriate for 

additional guidance or procedural 

documents, not the regulation. The 

regulation states that in their appeal, a 

claimant should identify the portion of 

the Authorized Official’s determination 

they believe is incorrect, whether that 

be the entire claim or just certain 

portions of the claim. The regulation 

also enables the claimant to supplement 

the record with additional documentary 

evidence supporting the appeal. After 

the appeal is decided, if the claimant 

continues to be dissatisfied with the 

determination, the claimant can pursue 

arbitration pursuant to Section 104(h)(3) 

of the Act or elect to seek record review 

of the decision in the Federal District 

Court for the District of New Mexico 

pursuant to Section 104(i) of the Act. 

Alternatively, the claimant can elect not 

to pursue compensation through the 

Hermit’s Peak/Calf Canyon Claims 

Office and elect to pursue their other 

legal remedies against the United States 

as explained in the Act.57

Comment: Two commenters raised 

questions about how the appeals 

process would work, asking what 

happened if claimants did not accept 

the Authorized Official’s final 

determination but chose not to appeal 

while another commenter asked if 

claimants would be allowed to choose 

their own attorney if they file an appeal. 

FEMA Response: If a claimant opts 

not to appeal and does not accept the 

final determination, the claimant 

remains free to pursue other remedies as 

detailed in the regulation at § 296.12. 

Claimants that wish to have legal 

representation may select their own 

counsel at any point in the claims 

process. 

Comment: FEMA received one 

comment in support of the IFR’s 

allowance for either the Claims Office 

Director or the claimant to request a 

conference. The commenter, however, 

requested additional changes to the IFR. 

The commenter wrote ‘‘I support this 

Interim Rule, with two caveats. First, to 

be fair and effective, attorneys 

representing claimants must be involved 

with their clients in either conferences 

or mediations. Second, mediators must 

be qualified and independent. In other 

words, they cannot be employees or 

representatives of FEMA or any other 

branch or agency of the United States 

Government. Th[e]s[e] changes would 

make the proposed conference and 

mediation process comport with 

ordinary and fair claims processing 

practice.’’ 

FEMA Response: As explained above, 

claimants that wish to have legal 

representation may select their own 

counsel at any point in the claims 

process. With an appropriate Privacy 

Act waiver, which is included in the 

Notice of Loss form, FEMA will ensure 

attorneys are allowed to participate with 

claimants in any and all parts of the 

Claims Process, up to and including any 

appeal-related conferences and 

arbitration of the claim. The Arbitration 

Administrator will maintain a list of 

qualified arbitrators who have agreed to 

serve. The Claims Office is using a 

contracting vehicle to engage 

independent arbitrators to serve as 

Claims Office arbitrators. Where 

possible, the Claims Office will use 

arbitrators that are local to New Mexico. 

The arbitrations will be decided by one 

arbitrator if the amount in dispute is 

$500,000 or less and a panel of three 

arbitrators if the amount in dispute 

exceeds $500,000. Arbitrators will be 


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58Animal Legal Defense Fund v. USDA, 789 F.3d 

1206 (11th Cir. 2015), citing In re Haas, 48 F.3d 

1153, 1156 (11th Cir. 1995), abrogated on other 

grounds by In re Griffith, 206 F.3d 1389 (11th Cir. 

2000). See also United States v. Roof, 10 F.4th 314 

(4th Cir. 2021), citing Discover Bank v. Vaden, 396 

F.3d 366, 370 (4th Cir. 2005). 

59 3 U.S. (3 Dall.) 306 (1796). See also Peter v. 

NantKwest, Inc., 140 S.Ct. 365 (2019), Hardt v. 

Reliance Standard Life Insurance Co., 560 U.S. 242 

(2010), Ruckelshaus v. Sierra Club, 463 U.S. 680 

(1983), and Summit Valley Industries, Inc. v. 

Carpenters, 456 U.S. 717 (1982). 

assigned by the Arbitration 

Administrator through a random 

drawing. 

Comment: One commenter requested 

FEMA allow claimant’s attorney to be 

notified and included throughout the 

entire hearing process. The commenter 

also requested that the rule be changed 

to allow the claimant to discover the 

evidence and opinions of those 

considered or proffered by the Claims 

Office against the claimant. 

FEMA Response: As explained above, 

claimants that wish to have legal 

representation may select their own 

counsel at any point in the claims 

process. With an appropriate Privacy 

Act waiver, which is included in the 

Notice of Loss form, FEMA will ensure 

attorneys are allowed to participate with 

claimants in any and all parts of the 

Claims Process, up to and including 

arbitration of the claim if the claimant 

elects to proceed to arbitration. As 

required by the Privacy Act, 5 U.S.C. 

552a, and implemented through Claims 

Office procedure, claimants always have 

access to their entire claims files. 

Moreover, FEMA is working to establish 

the System of Record, Claim and Loss 

Information Portal (CLIP), that will have 

a public facing portal where claimants 

can choose to create a secure account to 

review the status of their claim and 

upload documentation related to their 

Proof of Loss. 

Comment: Another commenter 

suggested FEMA allow for in-person 

conferences and hearings as often as 

possible. 

FEMA Response: Section 296.41(g) of 

the IFR states that hearings will 

generally be conducted virtually, but 

also allows the Director of the Claims 

Office to convene an in-person hearing 

at a location in New Mexico designated 

by the Director. The IFR language allows 

for in-person hearings and claimants 

can request in-person hearings if they 

prefer. FEMA does not believe the IFR 

requires amendment to allow for inperson hearings and is not revising the 

Final Rule. 

P. Comments on § 296.42 Arbitration 

Comment: Three commenters stated 

that expenses incurred for arbitration 

should be covered as compensatory 

damages. 

FEMA Response: It is unclear what 

the specific arbitration expenses are that 

are referenced in this comment. 

Generally, the Claims Office will pay all 

the fees and expenses of the 

arbitrator(s), as well as any associated 

fees and expenses for securing a 

location to hold the arbitration. The 

claimant is responsible for any expenses 

they incur, including travel costs. As 

explained in the IFR, compensatory 

damages for time spent in claims 

preparation are not available under New 

Mexico law or the Federal Tort Claims 

Act. Moreover, there is no evidence 

Congress intended that claimants be 

compensated for the value of their time 

in preparing a claim. Providing 

compensation for a claimant’s time 

would be difficult to administer, as 

FEMA would have to determine 

equitably the value of a claimant’s time 

and to verify that claimants have 

expended the number of hours that are 

claimed. FEMA’s payments under the 

Act are subject to independent audit by 

the GAO and the DHS OIG and 

claimants would likely find attempts by 

auditors to verify the payment for hours 

spent in the claims process highly 

intrusive. Additionally, the type of 

compensation requested by commenters 

here would require production of 

receipts and other documentation, 

resulting in an overly burdensome 

process for this payment to claimants 

contrary to other comments requesting 

the agency streamline and simplify the 

claims process. As explained in the IFR, 

FEMA is choosing to exercise discretion 

to provide a lump sum payment to 

claimants for miscellaneous and 

incidental expenses incurred in the 

claims process. FEMA will provide a 

lump sum payment of five percent of 

the insured and uninsured loss 

(excluding flood insurance premiums), 

not to exceed $25,000. The minimum 

lump sum payment is $150. Section 

296.31(b) of the IFR represents a fair and 

reasonable accommodation between the 

agency’s responsibility to spend Federal 

funds wisely and the desire to 

compensate claimants as fully as 

possible. 

To the extent the commenter is 

requesting that attorney’s fees be 

compensated by the Claims Office, the 

Act is silent regarding FEMA’s authority 

to pay attorney or agent fees. Generally, 

if Congress knows how to say something 

but chooses not to, its silence is 

controlling.58 While the Act places 

limits on the amount an attorney or 

agent may charge in section 104(j)(1), 

the Act does not provide for attorney or 

agent fees as allowable damages. 

Further, the ‘‘American Rule,’’ generally 

applicable in civil litigation and 

initially accepted by the United States 

Supreme Court in the case of Arcambel 

v. Wiseman,59 provides that in the 

absence of a statute indicating 

otherwise, each party is responsible for 

paying their own attorney fees. FEMA 

designed the claims process so that 

claimants will receive all eligible 

compensation without the need to 

engage the services of an attorney, and 

the Claims Office hired Claims 

Navigators to assist claimants compiling 

necessary documentation and with the 

Proof of Loss. Although claimants have 

the right to hire an attorney, one is not 

required. 

Comment: A commenter requested 

FEMA allow for in-person conferences 

and hearings as often as possible. 

Another commenter also suggested that 

these hearings take place in person and 

in the county of loss as virtual hearings 

are challenging because of limited or no 

broadband service in many areas 

impacted by the Fire. 

FEMA Response: Section 296.42(d) of 

the IFR states that hearings will 

generally be conducted virtually, but 

also allows the arbitrator to convene an 

in-person hearing at a location in New 

Mexico designated by the Arbitration 

Administrator. The IFR language allows 

for in-person hearings and claimants 

can request in-person hearings if they 

prefer. FEMA does not believe the IFR 

requires amendment to allow for inperson hearings and is not revising the 

Final Rule. 

Comment: Comments were also 

received on the independence, 

selection, and qualifications of 

arbitrators. One commenter requested 

the list of qualified arbitrators be 

provided by an independent source 

outside of FEMA. Commenters asked 

about the independence of arbitrators 

hired by FEMA. One commenter stated 

‘‘I seriously question the independence 

of an arbitrator who is both hired by and 

paid by FEMA . . . The one time in the 

past when I had to go to binding 

arbitration, the arbitrators were chosen 

from a board of independent arbitrators, 

not someone who was hired by the 

plaintiff or the defendant I should say 

in this case.’’ Another commenter 

stated, ‘‘I have never seen where the 

arbitrators brought in and both sides 

don’t get to eliminate based on how that 

arbitrator rules his rulings.’’ A different 

commenter requested that arbitrators be 

from New Mexico as they needed to be 

aware of the culture, the livelihood, the 

history, the importance of the people in 

the impacted communities. Another 


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60 5 U.S.C. 553. 

61Last accessed Mar. 1, 2023. 

commenter suggested that the arbitrators 

should be people who know New 

Mexico law. 

FEMA Response: FEMA understands 

the concerns raised by commenters 

regarding the selection of arbitrators for 

the claims process. These concerns are 

best addressed in policy and procedure 

documents associated with the claims 

process and not the regulations. FEMA 

is thus not making changes to the Final 

Rule regarding this issue. 

Q. Comments on the Rulemaking 

Comment: One commenter wrote on 

the lack of public comments posted 

with over half of the comment period 

completed and asked what FEMA was 

doing to publicize how to comment on 

the rulemaking. The commenter also 

asked questions about the availability of 

a local library for people to use the 

internet for public comment submission 

and suggested local FEMA offices accept 

verbal comments that could be posted 

online. 

FEMA Response: FEMA received over 

190 written comments on this rule in 

addition to over 100 comments during 

six public meetings held during the 

comment period across the area 

impacted by the Fire. FEMA provided 

public outreach to include News 

Releases, Media Advisories, and 

targeted communications to Federal, 

State, and local officials and their staff 

in New Mexico to help promote the 

process for submitting comments to 

https://www.regulations.gov. As 

explained above, transcripts of the 

public meetings were posted to the 

docket at https://www.regulations.gov to 

allow the public the opportunity to 

review comments made during these 

meetings if unable to attend. 

Comment: A commenter asked how 

out-of-state property owners would be 

notified of the Act and suggested FEMA 

obtain a list from the assessor’s office to 

mail those individuals information. 

FEMA Response: The IFR was 

published in the Federal Register at 

https://www.federalregister.gov/ 

documents/2022/11/14/2022-24728/ 

hermits-peakcalf-canyon-fire-assistance 

and also via print publication at 87 FR 

68085 on November 14, 2022. The 

Federal Register is national in scope 

and this notice in addition to the 

information provided at https://

www.fema.gov/hermits-peak constitute 

sufficient notice to out-of-state property 

owners. 

Comment: One commenter requested 

that FEMA provide access to the 

Federal Register to claimants. 

FEMA Response: FEMA provided 

access to the IFR by providing the link 

to the Federal Register containing the 

IFR at https://www.fema.gov/hermitspeak. Additionally, as explained above, 

the IFR was published in the Federal 

Register at https://

www.federalregister.gov/documents/ 

2022/11/14/2022-24728/hermitspeakcalf-canyon-fire-assistance and also 

via print publication at 87 FR 68085 on 

November 14, 2022. 

Comment: Two commenters sought 

virtual means of attending the public 

meetings on the IFR. 

FEMA Response: FEMA was unable to 

provide video conferencing or virtual 

attendance options during these 

meetings as they were not held in FEMA 

facilities. FEMA provided an 

explanation of this challenge in the 

Notice of Additional Public Meetings 

published on December 9, 2022. 

Transcripts of all public meetings are 

available on the docket at https://

www.regulations.gov. 

Comment: A commenter stated that 

that they were unable to hear a 

comment during a public meeting. 

Another commenter stated that the 

transcripts from the public meetings had 

not been posted to the public docket as 

of January 6, 2023 and suggested that all 

public meeting transcripts be posted 

preferably 72 but not less than 48 hours 

before the comment period closed. 

FEMA Response: Transcripts of all 

public meetings are available on the 

docket at https://www.regulations.gov. 

FEMA understands the commenters’ 

concerns about the timing of posting 

these transcripts and the agency worked 

diligently to have all of the transcripts 

posted prior to the end of the public 

comment period. Two transcripts were 

posted on January 9, 2023. Three 

transcripts were posted on January 12, 

2023, and the remaining transcript from 

the last public meeting was posted on 

January 13, 2023 in advance of the close 

of the public comment period. Given the 

volume of public meetings made 

available and the availability of the 

transcripts in advance of the close of the 

comment period provided sufficient 

opportunity for the public to either 

attend and/or review the meeting 

transcripts in advance of submitting any 

comments on the rule. FEMA notes that 

over 100 comments were received 

during the six public meetings held and 

over 50 comments were received on the 

last day of the comment period. 

Comment: Another commenter stated 

that FEMA may be having too many 

meetings as the meetings were taking a 

toll on the community and another 

commenter at that meeting also agreed, 

stating the meetings just felt like lip 

service and asked for progress on the 

Final Rule and changes to issues raised 

during meetings such as reforestation. 

FEMA Response: FEMA has worked 

diligently to the review and adjudicate 

all of the comments received on the IFR. 

FEMA is publishing this Final Rule in 

less than 8 months after the public 

comment period closed. This timeframe 

demonstrates the agency’s commitment 

to expeditiously process claims under 

the Act and resolve outstanding 

concerns of the community regarding 

the Act’s implementation by FEMA. 

Comment: One commenter suggested 

FEMA post responses to comments 

while a commenter at a public meeting 

suggested that FEMA publish a table 

that lists the comments and FEMA’s 

responses. 

FEMA Response: FEMA is providing 

responses to comments received as a 

result of the rulemaking process in this 

Final Rule. 

Comment: One commenter suggested 

that when fee or reimbursement 

schedules were developed, to allow for 

notice and comment and another 

commenter at a public meeting agreed. 

FEMA Response: FEMA appreciates 

this suggestion and if FEMA decides to 

proceed with payment formulas as 

discussed above, FEMA will consider 

whether notice and comment would be 

appropriate for such formulas at that 

time. 

Comment: One commenter requested 

the opportunity to comment on the 

Final Rule. 

FEMA Response: The rulemaking 

process as set forth in the 

Administrative Procedure Act does not 

require an agency to accept comment on 

a Final Rule.60 Further information on 

the rulemaking process can be found at 

https://www.federalregister.gov/ 

uploads/2011/01/the_rulemaking_

process.pdf.61

R. Other General Comments 

1. Comments on the Fire Footprint and 

Loss 

Commenters sought clarification and 

offered suggestions regarding claimants’ 

eligibility outside of the Fire’s 

immediate footprint. 

Comment: One commenter indicated 

that people and businesses outside the 

Fire’s direct footprint were impacted 

and should be compensated. This 

commenter wrote that many people and 

businesses outside of the Fires’ direct 

footprint were impacted due to things 

like the forest closures during fire 

response as well as the months 

following. A different commenter 

suggested relief be provided to New 

Mexico residents that do not live in the 


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59768 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

62See DR–4652–NM found at https://

www.fema.gov/disaster/4652 (last accessed Mar. 1, 

2023). 63 42 U.S.C. 5121 et seq. 

direct area of the fire as their business 

experienced a significant loss due to the 

Fire and damage to property in the 

impacted area. A commenter asked 

whether there was a geographic 

boundary for who is eligible to file a 

claim, explaining how the Fire impacted 

several counties with evacuations. 

Another commenter stated that the 

flooding impacted communities 

downstream from San Miguel and Mora 

counties and that there were several 

businesses impacted as well in those 

areas. However, another commenter 

requested claims be limited to residents 

of a specific geographic area. The 

commenter requested that FEMA limit 

claims to only residents and property 

owners in Mora and San Miguel 

Counties and bordering areas of 

neighboring counties stating that the 

funding that had been allocated to these 

victims was far from sufficient to cover 

the immediate, obvious loss that the 

people experienced with the Fire. 

FEMA Response: The Act recognizes 

that injured persons can seek 

compensation for actual compensatory 

damages for injuries incurred as a result 

of the Fire. There are no geographic 

limitations on this compensation 

beyond the claimant demonstrating they 

were injured as a result of the Fire. 

While the disaster declarations were 

limited to specific counties and further 

narrowed by the FEMA program,62 the 

Act has no such limitations. FEMA thus 

anticipates receiving and processing 

claims for any claimant suffering injury 

as a result of the Fire and seeking actual 

compensatory damages. 

2. Other General Comments 

Comment: A commenter expressed 

concern that FEMA was not seeking 

input from local leadership 

knowledgeable in the local culture and 

business and regulatory processes while 

a commenter at a public meeting 

requested accountability to local groups 

who are responsible for long-range 

recovery planning. 

FEMA Response: Consistent with the 

Act’s requirements in section 104(g), 

FEMA is in consultation with other 

Federal agencies, and State, local, and 

Tribal authorities to ensure the efficient 

administration of the claims process and 

provide for local concerns. 

Comment: One commenter suggested 

FEMA involve the United States 

Attorney for the District of New Mexico 

or the New Mexico State Attorney 

General to ensure the regulations follow 

New Mexico law. 

FEMA Response: As explained above, 

section 104(g) of the Act requires FEMA 

to consult with other Federal agencies, 

and State, local, and Tribal authorities 

to ensure the efficient administration of 

the claims process. FEMA has consulted 

and continues to consult with Federal, 

State, local, and Tribal authorities 

consistent with the Act’s requirements. 

FEMA consulted with a range of 

relevant Federal, State, and local 

agencies and governments. FEMA also 

completed a Tribal consultation as part 

of the regulatory process. 

Comment: One commenter suggested 

that FEMA review the minutes of the 

meeting held by Representative 

Fernandez’ in Mora after the Act’s 

passage to understand the intent of the 

Act. 

FEMA Response: FEMA appreciates 

the commenter’s input on 

Representative Fernandez’ public 

meeting. FEMA has met with the New 

Mexico Congressional Delegation 

regarding the Act’s implementation and 

received a comment on the IFR from the 

Delegation. FEMA has adjudicated that 

comment in this Final Rule and 

continues to engage with Congressional 

Representatives regarding the 

implementation of the Act. 

Comment: One commenter suggested 

FEMA provide education and awareness 

to county residents on preparedness for 

future manmade and natural disasters. 

FEMA Response: While this 

suggestion is outside the scope of the 

Act, the suggestion does fall within 

FEMA’s overall mission. The agency is 

coordinating with the State on the 

integration of long-term recovery efforts 

and resilience resources under the 

Robert T. Stafford Disaster Relief and 

Emergency Assistance Act (‘‘Stafford 

Act’’) and other applicable statutory 

authorities.63

Comment: One commenter asked 

FEMA to do outreach to the community 

and assist people, as the experience 

with seeking benefits from FEMA 

during the disaster had been one of 

being turned away. 

FEMA Response: Unlike the FEMA 

programs operated under the Stafford 

Act, the Hermit’s Peak/Calf Canyon Fire 

Assistance Act offers a distinct claims 

process for claimants to seek actual 

compensatory damages for injuries 

suffered as a result of the Fire. The Act’s 

provisions do not have the same 

eligibility requirements associated with 

the Public Assistance and Individual 

Assistance Programs under the Stafford 

Act. Claimants that were denied 

assistance under those programs should 

not assume their claim will be rejected 

under the Act. The regulation provides 

the general framework for compensation 

under the Act and claimants that have 

been injured as a result of the Fire 

should pursue claims for compensatory 

damages under the Act even if they 

were denied assistance under the 

Stafford Act programs. 

FEMA is currently accepting Notice of 

Loss forms in person at the Claims 

Office locations in Santa Fe, Mora, and 

Las Vegas, New Mexico and those office 

addresses can be found at https://

www.fema.gov/hermits-peak. FEMA 

will provide services both at set office 

locations for the Claims Offices, as well 

as pop-up offices that will rotate 

through communities and locations in 

the affected area, to reduce travel 

burdens on claimants. The pop-up 

offices will be staffed by Claims 

Navigators, who can assist claimants in 

completing and submitting Notices of 

Loss, providing claims updates, and 

answering general questions. FEMA 

plans to offer opportunities for one-onone engagement with Navigators and 

Claims Reviewers who will work to 

engage claimants in ways to meet their 

needs whether in person or via remote 

technology. Claims Office Navigators are 

trained to accommodate the needs of 

claimants. FEMA recognizes the 

importance of having claims staff, who 

interact with claimants and help 

facilitate the claims process, that are 

able to speak both Spanish and English. 

FEMA locally hired bilingual speakers 

to ensure that claims staff can 

communicate with claimants in their 

preferred language. 

Comment: Another commenter asked 

that FEMA listen to the community on 

what they value, as it is different from 

how FEMA appeared to be valuing 

buildings, the land, the trees, or the 

water. 

FEMA Response: FEMA heard the 

comments regarding the need to reassess 

the formulas placed in the IFR and is 

making changes in the Final Rule to 

address those concerns. The Final 

Rule’s changes better reflect the 

impacted communities’ needs and 

values while maintaining consistency 

with the Act’s authorities. 

Comment: A commenter stated ‘‘Every 

time there is a flood, every time there is 

a massive weather event, FEMA is to 

come out now. So, they are 

understaffed, but here there is a big 

difference because the appropriations 

that our legislators have fought to get 

something in place. So, if you got 

something, you got something to work 

with, and I am saying that like our flood 

was in 2017, and I still haven’t 

recovered . . . So, your comments, and 

you’re coming to these meetings are 


ddrumheller on DSK120RN23PROD with RULES4
Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 59769 

64Last accessed Mar. 1, 2023. 65See Sections 102(b) and 104(c) of the Act. 66Last accessed Mar. 1, 2023. 

demonstrations that you care about 

yourselves, you know they are not going 

to chase you off.’’ 

FEMA Response: FEMA agrees with 

the commenter that the Act’s provisions 

are different from Stafford Act programs 

and that claimants should engage with 

FEMA on their claims. As the 

commenter stated, FEMA received 

appropriations for the Act and is 

required to staff the Claims Office to 

meet the needs of the community to 

process their claims in an expeditious 

manner. 

Comment: One commenter stated that 

the communities needed to leverage the 

Act’s funding in conjunction with the 

overall rollout of infrastructure funding 

to protect food security and food 

systems. 

FEMA Response: FEMA recognizes 

that other funding may be available to 

further support the long-term recovery 

of the impacted communities beyond 

the funding appropriated by the Act. 

FEMA appreciates the commenter’s 

suggestion that the impacted 

communities also consider that funding 

and how all available funding can work 

to improve the community. FEMA has 

consulted and continues to consult with 

Federal, State, local, and Tribal 

authorities consistent with the Act’s 

requirements. 

Comment: One commenter stated that 

they were concerned that money from 

the Act would go to contractors that are 

coming in from the outside area. 

FEMA Response: FEMA understands 

the need for local hiring for the Claims 

Office and FEMA has engaged in an 

extensive effort to recruit locally for 

positions to support the processing of 

claims and provision of compensation 

to claimants impacted by the Fire to 

ensure these specific concerns are 

addressed. FEMA is not responsible for 

hiring contractors to handle local 

projects under the Act. FEMA 

recognizes that other Federal programs, 

including FEMA Stafford Act programs, 

may leverage contract support for local 

projects. The process associated with 

those contracts varies by program. 

General information on contracting for 

FEMA programs can be found at https:// 

www.fema.gov/grants/procurement.64

Comment: Another commenter 

provided a suggestion on how to spend 

the funding allocated under the Act by 

requiring it to cycle through the 

community several times before it 

leaves the impacted communities. 

FEMA Response: FEMA is authorized 

under the Act to pay claimants for 

actual compensatory damages for 

injuries resulting from the Fire.65 FEMA 

does not have the authority under the 

Act to require claimants to spend the 

compensation awarded in the local 

community. 

Comment: Another commenter 

recommended FEMA hire local 

contractors for FEMA projects. The 

commenter stated ‘‘The other piece is 

the issue with contracts. So, we have a 

lot of local contractors working here. We 

have local contractors working. We have 

the majority of them not working and 

that is another FEMA issue. Massive 

contracts went out, the Mora people, or 

Mora contractors are being 

subcontracted; they are not even given 

the opportunity—that is wages lost. If 

you are working for a contractor as a 

subcontractor, you’ve lost wages. You’ve 

lost revenue, and that’s another part that 

FEMA’s failed to do and failed to 

represent the people.’’ 

FEMA Response: As explained above, 

FEMA is not responsible for hiring 

contractors to handle local projects 

under the Act. FEMA recognizes that 

other Federal programs, including 

FEMA Stafford Act programs, may 

leverage contract support for local 

projects. The process associated with 

those contracts varies by program. 

General information on contracting for 

FEMA programs can be found at https:// 

www.fema.gov/grants/procurement.66

The Claims Office encourages its 

contractors to hire locally. 

Comment: A commenter stated the 

Claims Office was responsible for 

clarifying and ensuring that claimants 

are not taxed for the claims payments 

they receive through the program. 

FEMA Response: FEMA appreciates 

claimants’ concerns with taxes. Section 

104(h)(f) of the Act states that ‘‘the value 

of compensation that may be provided 

under this Act shall not be considered 

income or resources for any purpose 

under any Federal, State, or local laws, 

including laws related to taxation, 

welfare, and public assistance programs 

. . .’’ FEMA is providing this 

information to claimants as part of the 

payment process. FEMA is not 

responsible for taxation and encourages 

claimants to obtain specific assistance if 

a Federal, State, or local entity seeks to 

consider compensation under the Act as 

taxable income or income for welfare or 

public assistance purposes. The agency 

does not believe changes to the IFR 

regulatory text are needed in the Final 

Rule to effect the commenter’s request. 

S. Change Chart 

The below table summarizes the 

changes FEMA has made in this final 

rule. The economic impacts of these 

changes are discussed further in Section 

IV.B, ‘‘Executive Order 12866, 

Regulatory Planning and Review and 

Executive Order 13563, Improving 

Regulation and Regulatory Review.’’ 

44 CFR IFR text Final rule text Reason for change Economic impact 

296.1 ................... This part implements the Hermit’s 

Peak/Calf Canyon Fire Assistance Act (Act), Division G of 

Public Law 117–180, 136 Stat. 

2114, 2168, which requires the 

Federal Emergency Management Agency (FEMA) to establish the Office of Hermit’s Peak/ 

Calf Canyon Fire Claims 

(‘‘Claims Office’’) to receive, 

evaluate, process, and pay actual compensatory damages for 

injuries suffered from the Hermit’s Peak/Calf Canyon Fire.

This part implements the Hermit’s 

Peak/Calf Canyon Fire Assistance Act (Act), Division G of 

Public Law 117–180, 136 Stat. 

2114, 2168, which requires the 

Federal Emergency Management Agency (FEMA) to establish the Office of Hermit’s Peak/ 

Calf Canyon Fire Claims 

(‘‘Claims Office’’) to receive, 

evaluate, process, and pay actual compensatory damages for 

injuries resulting from the Hermit’s Peak/Calf Canyon Fire.

Consistency with authorizing statute’s language and clarity that 

injuries resulting from the Fire 

are compensable.

None. 


ddrumheller on DSK120RN23PROD with RULES4
59770 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

44 CFR IFR text Final rule text Reason for change Economic impact 

296.4 ................... Subsistence Resources means 

food and other items obtained 

through hunting, fishing, firewood gathering, timbering, grazing or agricultural activities undertaken by the claimant without financial remuneration, on 

land damaged by the Hermit’s 

Peak/Calf Canyon Fire.

Subsistence Resources means 

food and other items obtained 

through hunting, fishing, firewood or other natural resource 

gathering, timbering, grazing or 

agricultural activities undertaken 

by the claimant without financial 

remuneration, on land damaged 

by the Hermit’s Peak/Calf Canyon Fire.

Consistency with the distinctions 

between the communities impacted by the Cerro Grande 

and Hermit’s Peak/Calf Canyon 

Fires and need to accommodate geographic, economic, and 

cultural distinctions into the Hermit’s Peak/Calf Canyon Fire Assistance process.

Higher claims values for those 

claiming assistance for ‘‘other 

natural resource’’ gathering. 

Potential increase in transfer payments from FEMA to claimants. 

296.12(a) ............. An Injured Person who accepts an 

award under the Act waives the 

right to pursue all claims for injuries arising out of or relating 

to the same subject matter 

against the United States or any 

employee, officer, or agency of 

the United States through the 

Federal Tort Claims Act or a 

civil action authorized by any 

other provision of law.

An Injured Person who accepts a 

final award under the Act 

waives the right to pursue all 

claims for injuries arising out of 

or relating to the same subject 

matter against the United States 

or any employee, officer, or 

agency of the United States 

through the Federal Tort Claims 

Act or a civil action authorized 

by any other provision of law.

Clarity that claimants only waive 

their rights upon acceptance of 

a final award.

None. 

296.12(b) ............. An Injured Person who accepts an 

award through a Federal Tort 

Claims Act claim or a civil action against the United States or 

any employee, officer, or agency of the United States relating 

to the Hermit’s Peak/Calf Canyon Fire waives the right to pursue any claim arising out of or 

relating to the same subject 

matter under the Act.

An Injured Person who accepts a 

final award through a Federal 

Tort Claims Act claim or a civil 

action against the United States 

or any employee, officer, or 

agency of the United States relating to the Hermit’s Peak/Calf 

Canyon Fire waives the right to 

pursue any claim arising out of 

or relating to the same subject 

matter under the Act.

Clarity that claimants only waive 

their rights upon acceptance of 

a final award.

None. 

296.13 ................. An insurer or other third party with 

the rights of a subrogee, who 

has compensated an injured 

person for Hermit’s Peak/Calf 

Canyon Fire related injuries, 

may file a Notice of Loss under 

the Act for the subrogated 

claim. A subrogee may file a 

Notice of Loss without regard to 

whether the Injured Person who 

received payment from the 

subrogee filed a Notice of Loss. 

A Subrogation Notice of Loss 

should be filed after the 

subrogee has made all payments that it believes the Injured Person is entitled to receive for Hermit’s Peak/Calf 

Canyon Fire related injuries 

under the terms of the insurance policy or other agreement 

between the subrogee and the 

Injured Person, but not later 

than November 14, 2024. By filing a Notice of Loss for any 

subrogated claim, the subrogee 

elects the Act as its exclusive 

remedy against the United 

States or any employee, officer, 

or agency of the United States 

for all subrogated claims arising 

out of the Hermit’s Peak/Calf 

Canyon Fire. Subrogation 

claims must be made on a Notice of Loss form furnished by 

the Claims Office.

An insurer or other third party with 

the rights of a subrogee, who 

has compensated an injured 

person for Hermit’s Peak/Calf 

Canyon Fire related injuries, 

may file a Notice of Loss under 

the Act for the subrogated 

claim. A subrogee may file a 

Notice of Loss without regard to 

whether the Injured Person who 

received payment from the 

subrogee filed a Notice of Loss. 

A Subrogation Notice of Loss 

should be filed after the 

subrogee has made all payments that it believes the Injured Person is entitled to receive for Hermit’s Peak/Calf 

Canyon Fire related injuries 

under the terms of the insurance policy or other agreement 

between the subrogee and the 

Injured Person, but not later 

than November 14, 2024. By filing a Notice of Loss for any 

subrogated claim, the subrogee 

elects the Act as its exclusive 

remedy against the United 

States or any employee, officer, 

or agency of the United States 

for all subrogated claims arising 

out of the Hermit’s Peak/Calf 

Canyon Fire. Subrogation 

claims must be made on a Notice of Loss form furnished by 

the Claims Office and such 

claims will be paid only after 

paying claims submitted by injured persons that are not insurance companies seeking payment as subrogees.

Consistency with authorizing statute’s language.None. 

296.21(a) ............. (a) Allowable damages. The Act 

provides for the payment of actual compensatory damages for 

Injury or loss of property, business loss, and financial loss. 

The laws of the State of New 

Mexico will apply to the calculation of damages. Damages 

must be reasonable in amount.

(a) Allowable damages. The Act 

provides for the payment of actual compensatory damages for 

injury or loss of property, business loss, and financial loss. 

The laws of the State of New 

Mexico will apply to the calculation of damages. Damages 

must be reasonable in amount.

Technical edit ................................ None. 


ddrumheller on DSK120RN23PROD with RULES4
Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 59771 

44 CFR IFR text Final rule text Reason for change Economic impact 

296.21(c)(2) ......... Reforestation and revegetation. 

Compensation for the replacement of destroyed trees and 

other landscaping will not exceed 25 percent of the pre-fire 

value of the structure and lot.

Reforestation and revegetation. 

Compensatory damages may 

be awarded for the cost of destroyed trees and other landscaping.

Consistency with the distinctions 

between the communities impacted by the Cerro Grande 

and Hermit’s Peak/Calf Canyon 

Fires and need to accommodate geographic, economic, and 

cultural distinctions into the Hermit’s Peak/Calf Canyon Fire Assistance process.

Removes the formula for compensation for destroyed trees 

and other landscaping. 

This would potentially lead to an 

increase in the value of awarded claims. Claimants would 

benefit by receiving additional 

assistance and be able to recover more fully. 

This would not affect the maximum total impact of the rule of 

$3.95B, but transfer payments 

from FEMA to these claimants 

would potentially increase. 

FEMA may also bear an additional administrative cost to 

process the additional claims. 

296.21(c)(3)(ii) ..... The claimant can establish that 

the value of the real property 

was permanently diminished as 

a result of the Hermit’s Peak/ 

Calf Canyon Fire.

The claimant can establish that 

the value of the real property 

was significantly diminished 

long-term as a result of the Hermit’s Peak/Calf Canyon Fire.

Consistency with the distinctions 

between the communities impacted by the Cerro Grande 

and Hermit’s Peak/Calf Canyon 

Fires and need to accommodate geographic, economic, and 

cultural distinctions into the Hermit’s Peak/Calf Canyon Fire Assistance process.

None. 

296.21(c)(5) ......... N/A ................................................ Physical Infrastructure. Compensatory damages may be awarded for the damage to physical 

infrastructure, including damages to irrigation infrastructure 

such as acequia systems.

Consistency with authorizing statute’s language and with the distinctions between the communities impacted by the Cerro 

Grande and Hermit’s Peak/Calf 

Canyon Fires and need to accommodate geographic, economic, and cultural distinctions 

into the Hermit’s Peak/Calf Canyon Fire Assistance process.

None. 

296.21(e)(3) ......... Out of pocket expenses for treatment of mental health conditions. FEMA may reimburse an 

individual claimant for reasonable out of pocket expenses incurred for treatment of a mental 

health condition rendered by a 

licensed mental health professional, which condition resulted 

from the Hermit’s Peak/Calf 

Canyon Fire. FEMA will not reimburse for treatment rendered 

after April 6, 2024.

Out of pocket expenses for treatment of mental health conditions. FEMA may reimburse an 

individual claimant for reasonable out of pocket expenses incurred for treatment of a mental 

health condition rendered by a 

licensed mental health professional, which condition resulted 

from or was worsened by the 

Hermit’s Peak/Calf Canyon Fire.

Reflects public comment feedback 

on to allow for claims to be filed 

under deadline for all other 

claims and revised for clarity on 

the types of mental health conditions covered.

Removes time limit on reimbursements for treatment. 

Additional claims will potentially 

be filed after April 6, 2024, leading to more claims and claims 

payments. 

This would potentially lead to an 

increase in the value of awarded claims. Claimants would 

benefit by receiving additional 

assistance and be able to recover more fully. 

This would not affect the maximum total impact of the rule of 

$3.95B, but transfer payments 

from FEMA to these claimants 

would potentially increase. 

FEMA may also bear an additional administrative cost to 

process the additional claims. 

296.21(e)(4) ......... Donations. FEMA will compensate 

claimants for the cost of merchandise, use of equipment or 

other non-personal services, directly or indirectly donated to 

survivors of the Hermit’s Peak/ 

Calf Canyon Fire not later than 

September 20, 2022. Donations 

will be valued at cost.

Donations. FEMA will compensate 

claimants for the cost of merchandise, use of equipment or 

other non-personal services, directly or indirectly donated to 

survivors of the Hermit’s Peak/ 

Calf Canyon Fire not later than 

November 14, 2022. Donations 

will be valued at cost.

Reflects public comment feedback 

on appropriate timeline.

Extends the deadline by approximately 8 weeks for compensation for donations to survivors of 

the fire. 

Additional claims for reimbursement were potentially be filed 

between September 21 and November 14, 2022, leading to 

more claims and claims payments. 

This would potentially lead to an 

increase in the number of 

awarded claims. More claimants 

would benefit by receiving assistance and be able to recover 

more fully. 

This would not affect the maximum total impact of the rule of 

$3.95B, but transfer payments 

from FEMA to claimants would 

increase. 

FEMA may also bear an additional administrative cost to 

process the additional claims. 


ddrumheller on DSK120RN23PROD with RULES4
59772 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

44 CFR IFR text Final rule text Reason for change Economic impact 

296.21(e)(5) ......... Heightened Risk Reduction. 

FEMA will reimburse claimants 

for the costs incurred to implement reasonable measures necessary to reduce risks from natural hazards heightened by the 

Hermit’s Peak/Calf Canyon Fire 

to the level of risk prevailing before the Hermit’s Peak/Calf 

Canyon Fire. Such measures 

may include, for example, risk 

reduction projects that reduce 

an increased risk from flooding, 

mudslides, and landslides in 

and around burn scars. Compensation under this section 

may not exceed 25 percent of 

the higher of payments from all 

sources (i.e., the Act, insurance 

proceeds, FEMA assistance 

under the Stafford Act) for damage to the structure and lot, or 

the pre-fire value of the structure and lot. Claimants seeking 

compensation for heightened 

risk reduction must include the 

claim in their Notice of Loss by 

November 14, 2024 or an 

amended Notice of Loss filed 

no later than November 14, 

2025. Claimants should take 

into account current building 

codes and standards and must 

complete the risk reduction 

project for which they receive 

compensation.

Heightened Risk Reduction. 

FEMA will reimburse claimants 

for the costs incurred to implement reasonable measures necessary to reduce risks from natural hazards heightened by the 

Hermit’s Peak/Calf Canyon Fire 

to the level of risk prevailing before the Hermit’s Peak/Calf 

Canyon Fire. Such measures 

may include, for example, risk 

reduction projects that reduce 

an increased risk from flooding, 

mudslides, and landslides in 

and around burn scars. Claimants seeking compensation for 

heightened risk reduction must 

include the claim in their Notice 

of Loss by November 14, 2024 

or an amended Notice of Loss 

filed no later than November 14, 

2025. Claimants should take 

into account current building 

codes and standards and must 

complete the risk reduction 

project for which they receive 

compensation.

Consistency with the distinctions 

between the communities impacted by the Cerro Grande 

and Hermit’s Peak/Calf Canyon 

Fires and need to accommodate geographic, economic, and 

cultural distinctions into the Hermit’s Peak/Calf Canyon Fire Assistance process.

Removes the formula for compensation for measures taken to 

reduce risk from natural hazards heightened by the Fire. 

This would potentially lead to an 

increase in the value of awarded claims. Claimants would 

benefit by receiving additional 

assistance and be able to recover more fully. 

This would not affect the maximum total impact of the rule of 

$3.95B, but transfer payments 

from FEMA to these claimants 

would potentially increase. 

FEMA may also bear an additional administrative cost to 

process the claims. 

296.21(f) .............. Insurance and other benefits. The 

Act allows FEMA to compensate Injured Persons only 

for damages not paid, or will not 

be paid, by insurance or other 

third-party payments or settlements.

Insurance and other benefits. The 

Act allows FEMA to compensate Injured Persons only 

for damages not paid, and that 

will not be paid, by insurance or 

other third-party payments or 

settlements.

Technical edit ................................ None. 

296.31(a) ............. FEMA will reimburse claimants for 

the reasonable costs they incur 

in providing documentation requested by the Claims Office. 

FEMA will also reimburse claimants for the reasonable costs 

they incur in providing appraisals, or other third-party opinions, requested by the Claims 

Office. FEMA will not reimburse 

claimants for the cost of appraisals or other third-party 

opinions not requested by the 

Claims Office.

FEMA will reimburse claimants for 

the reasonable costs they incur 

in providing documentation requested by the Claims Office. 

FEMA will also reimburse claimants for the reasonable costs 

they incur in providing appraisals, or other third-party opinions, that the Claims Office 

deems necessary to determine 

the amount of the claim. FEMA 

will not reimburse claimants for 

the cost of appraisals or other 

third-party opinions not requested by the Claims Office.

Consistency with the distinctions 

between the communities impacted by the Cerro Grande 

and Hermit’s Peak/Calf Canyon 

Fires and need to accommodate geographic, economic, and 

cultural distinctions into the Hermit’s Peak/Calf Canyon Fire Assistance process.

None. 


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67See Bryan Pietsch and Jason Samenow, ‘‘New 

Mexico blaze is now largest wildfire in state 

history,’’ The Washington Post, May 17, 2022 found 

at https://www.washingtonpost.come/nation/2022/ 

05/17/calf-canyon-hermits-peak-fire-new-mexico/ 

(last accessed July 27, 2023). 

68See New Mexico Forest and Watershed 

Restoration Institute, ‘‘Hermit’s Peak and Calf 

Canyon Fire: The largest wildfire in New Mexico’s 

recorded history and its lasting impacts’’ Aug. 24, 

2022 found at https://storymaps.arcgis.com/stories/ 

d48e2171175f4aa4b5613c2d11875653 (last 

accessed Sept. 27, 2022). 

69 Id. 

70See Jordan Honeycutt, ‘‘Rain brings flash 

flooding to Hermits Peak Calf Canyon burn scar,’’ 

KRQE, July 13, 2022 found at https://

www.krqe.com/news/new-mexico/rain-brings-flashflooding-to-hermits-peak-calf-canyon-burn-scar/ 

(last accessed July 27, 2023), and Simon Romero, 

‘‘How New Mexico’s Largest Wildfire Set Off a 

Drinking Water Crisis,’’ The New York Times, Sept. 

26, 2022 found at https://www.nytimes.com/2022/ 

09/26/us/new-mexico-las-vegas-fire-water.html (last 

accessed Sept. 27, 2022). 

44 CFR IFR text Final rule text Reason for change Economic impact 

296.35 ................. The Director of the Claims Office 

may reopen a claim if requested 

to do so by the claimant, notwithstanding the submission of 

the Release and Certification 

Form, for the limited purpose of 

considering issues raised by the 

request to reopen if, not later 

than November 14, 2025, the 

claimant desires heightened risk 

reduction compensation in accordance with § 296.21(e)(5); 

the claimant closed the sale of 

a home and wishes to present a 

claim for decrease in the value 

of the real property under 

§ 296.21(c)(3); the claimant has 

incurred additional losses under 

§ 296.21(c)(1) as part of a reconstruction in excess of those 

previously awarded; or the Director of the Claims Office otherwise determines that claimant 

has demonstrated good cause.

The Director of the Claims Office 

may reopen a claim if requested 

to do so by the claimant, notwithstanding the submission of 

the Release and Certification 

Form, for the limited purpose of 

considering issues raised by the 

request to reopen if, not later 

than November 14, 2025, the 

claimant desires heightened risk 

reduction compensation in accordance with § 296.21(e)(5); 

the claimant closed the sale of 

real property and wishes to 

present a claim for decrease in 

the value of the real property 

under § 296.21(c)(3). Claimants 

may request to reopen claims 

where the claimant has incurred 

additional losses under 

§ 296.21(c)(1) as part of a reconstruction in excess of those 

previously awarded or the Director of the Claims Office otherwise determines that claimant 

has demonstrated good cause 

no later than the deadline established by the Director of the 

Claims Office as published in 

the Federal Register and at 

https://www.fema.gov/hermitspeak.

Consistency with the distinctions 

between the communities impacted by the Cerro Grande 

and Hermit’s Peak/Calf Canyon 

Fires and need to accommodate geographic, economic, and 

cultural distinctions into the Hermit’s Peak/Calf Canyon Fire Assistance process while also incorporating a past practice from 

Cerro Grande to extend the 

deadline by Federal Register 

publication for certain losses.

A claimant may file a claim for depreciation after the sale of any 

real property, not only a home. 

The deadline to request to reopen 

a claim under limited circumstances is extended by 

publication in the Federal Register. 

Both of these changes would potentially lead to an increase in 

claims and more claims being 

awarded. Claimants would benefit by receiving additional assistance and be able to recover 

more fully. 

This would not affect the maximum total impact of the rule of 

$3.95B, but transfer payments 

from FEMA to these claimants 

would potentially increase. 

FEMA may also bear an additional administrative cost to 

process the claims. 

IV. Regulatory Analysis 

A. Administrative Procedure Act (APA) 

The IFR that this Final Rule makes 

final, with the changes detailed above in 

response to public comment is already 

in effect. FEMA issued the IFR pursuant 

to statutory authority under the Act. 

Specifically, section 104(f)(1) requires 

FEMA to publish ‘‘interim final 

regulations for the processing and 

payment of claims under this Act.’’ 

Further, the IFR had to be published 

‘‘not later than 45 days after the date of 

enactment.’’ Given Congress’ specific 

authority to issue an IFR, the agency 

had good cause to proceed without 

advance notice and comment as would 

have otherwise been required under the 

APA. See 5 U.S.C. 553(b)(B); Hermit’s 

Peak/Calf Canyon Fire Assistance, 87 FR 

68085, 68095 (Nov. 14, 2022) 

(‘‘Consistent with Congress’ direction in 

section 104(f)(1) of the Act that FEMA 

publish ‘interim final regulations for the 

processing and payment of claims under 

[the] Act,’ good cause exists pursuant to 

5 U.S.C. 553 (b)(B) as it would be 

impracticable and contrary to the public 

interest to require notice and comment 

rulemaking in this instance.’’). 

FEMA finds there is good cause, 

under 5 U.S.C. 553(d)(3), not to require 

a 30-day delayed effective date for this 

rulemaking because delaying 

implementation of this Final Rule by 30 

days is contrary to the goal of the 

statutory purpose found at section 

102(b)(2) of the Act to provide for the 

expeditious consideration and 

settlement of claims for injuries 

resulting from the Fire. The Act 

required FEMA to promulgate and 

publish an IFR within 45 days after the 

Act’s enactment, and delay in the 

effective date of a Final Rule with 

changes to that IFR would further 

negatively impact claimants seeking 

compensation through the Act. The 

updates made in this Final Rule will 

address concerns raised by commenters 

on the application of the Cerro Grande 

Fire Assistance processes for the 

Hermit’s Peak/Calf Canyon Fire 

Assistance process and ensures the 

process better reflects the needs of 

injured persons and impacted 

communities from the Hermit’s Peak/ 

Calf Canyon Fire given the geographic, 

economic, and cultural distinctions 

between the Cerro Grande and Hermit’s 

Peak/Calf Canyon Fires. This Final Rule 

will provide additional clarity to 

claimants seeking to utilize the Hermit’s 

Peak/Calf Canyon claims process and 

receive compensation for actual 

compensatory damages suffered as a 

result of the Fire. Given the 

Congressional mandate to expeditiously 

consider and settle these claims, this 

Final Rule must be effective upon 

publication. 

The Fire constitutes the largest 

wildfire in New Mexico history.67 Over 

340,000 acres of forest burned during 

the Fire and over half of the land 

impacted by the Fire consisted of 

privately-owned land, with just under 

200,000 total acres burned.68 At least 

160 homes and a total of over 900 

structures were destroyed during the 

Fire.69 Despite containment, the impact 

of the Fire continues to be felt in the 

impacted areas, causing flooding and 

setting off a drinking water crisis.70 The 

higher burn severity of soil on private 

lands increases the likelihood of 

flooding and mudslide impacts on those 

areas. Residents in the areas of the Fire 

have already suffered significant 

damage from flooding, including 

washed out roads and buildings, 

drowned pastures, and burned debris 


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59774 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

71See New Mexico Forest and Watershed 

Restoration Institute, ‘‘Hermit’s Peak and Calf 

Canyon Fire: The largest wildfire in New Mexico’s 

recorded history and its lasting impacts’’ Aug. 24, 

2022 found at https://storymaps.arcgis.com/stories/ 

d48e2171175f4aa4b5613c2d11875653 (last 

accessed Sept. 27, 2022). 

72Agency Information Collection Activities: 

Proposed Collection; Comment Request; Generic 

Clearance for Notice of Loss and Proof of Loss, 88 

FR 29144 (May 5, 2023). FEMA estimates that 

28,725 applicants annually will incur 

approximately 25.5 burden hours each. Over the 

two-year period, FEMA estimates a total of 57,450 

claims with a corresponding 1,464,980 burden 

hours. 

73 Division A of Public Law 117–180, 136 Stat. 

2144 (2022) and Consolidated Appropriations Act, 

2023, Public Law 117–328, 136 Stat. 4459. 

74 Id. 

75 Id. 

76 Division G of Public Law 117–180, 136 Stat. 

2114 (2022). 

moved downstream.71 In addition, as 

noted above, Congress explicitly 

mandated in section 104(f)(1) of the Act 

that FEMA promulgate these regulations 

expeditiously as interim final 

regulations, a factor that supports a 

finding of ‘‘good cause’’ to also issue 

this Final Rule without an effective date 

delay. Pursuant to section 104(f)(1) of 

the Act, consistent with 5 U.S.C. 

553(d)(3), and for the reasons stated 

above, FEMA therefore will make this 

Final Rule effective immediately upon 

publication. 

B. Executive Order 12866, Regulatory 

Planning and Review, as Amended, and 

Executive Order 13563, Improving 

Regulation and Regulatory Review 

Executive Order 12866 (Regulatory 

Planning and Review), as amended by 

Executive Order 14094 (Modernizing 

Regulatory Review) and Executive Order 

13563 (Improving Regulation and 

Regulatory Review), directs agencies to 

assess the costs and benefits of available 

regulatory alternatives and, if regulation 

is necessary, to select regulatory 

approaches that maximize net benefits 

(including potential economic, 

environmental, public health and safety 

effects, distributive impacts, and 

equity). Executive Order 13563 

emphasizes the importance of 

quantifying both costs and benefits, of 

reducing costs, of harmonizing rules, 

and of promoting flexibility. The Office 

of Management and Budget (OMB) has 

designated this rule a ‘‘significant 

regulatory action’’ as defined under 

section 3(f)(1) of Executive Order 12866, 

as amended by E.O. 14094. Accordingly, 

the rule has been reviewed by OMB. 

In the IFR, FEMA established a 

process by which claimants who were 

injured as a result of the Fire may apply 

for compensation under the Act. FEMA 

is updating that process through this 

Final Rule. Affected State, local, and 

Tribal governments, private sector 

businesses, not-for-profit organizations, 

and individuals and households are 

eligible to apply for compensation based 

on clarifying changes made in this Final 

Rule. The established process results in 

costs to claimants for time to apply for 

and substantiate a claim, and for FEMA 

to process and adjudicate claims. 

Claimants submit a Notice of Loss to 

FEMA, meet with a FEMA Claims 

Reviewer, obtain the documentation 

needed to substantiate claims, sign a 

Proof of Loss, and complete and return 

a Release and Certification Form. 

Additionally, affected insurance 

companies are eligible to submit a 

subrogation notice of loss for possible 

compensation under the Act. Claimants 

who disagree with FEMA’s evaluation of 

the claim may also incur costs to appeal 

the determination. FEMA estimates 

approximately 28,725 claimants will 

seek compensation under the Act 

annually, totaling 732,490 burden hours 

per year.72

The IFR and this rule result in 

additional transfer payments from 

FEMA to victims for the settlement of 

claims for injuries resulting from the 

Fire. Injuries may include property, 

business and/or financial losses. 

Congress appropriated $3.95 billion to 

provide for the expeditious 

consideration and settlement of these 

claims.73 The maximum total economic 

impact of these actions, therefore, is 

$3.95 billion (assuming that all funds 

awarded will be expended). These funds 

are for the settlement of actual 

compensatory damages measured by 

injuries suffered, FEMA’s 

administration of the program, and DHS 

OIG oversight.74 However, without 

knowing the dollar amount of claims 

that will be filed for these injuries, it is 

impossible to predict the amount of the 

economic impact with any precision. As 

of July 5, 2023, FEMA has received 

1,353 Notices of Loss, which includes 

2,257 claimants. 

The Act requires claims to be 

submitted no later than two years after 

publication of the IFR or November 14, 

2024.75 The Act requires that FEMA 

determine and fix the amount to be paid 

for a claim within 180 days after a claim 

is submitted.76 Although the impact of 

the rule could be spread over multiple 

years as claims are received, processed, 

and paid, the total economic effects of 

a specific payment would only occur 

once, rather than annually. 

These actions provide distributional 

benefits to victims of the Fire. FEMA 

has provided immediate assistance 

under the Robert T. Stafford Disaster 

Relief and Emergency Assistance Act 

(Stafford Act), as amended (Pub. L. 93– 

288) (42 U.S.C. 5121, et seq.) to those 

eligible for public and individual 

assistance pursuant to the President’s 

declaration of a major disaster on May 

4, 2022. The additional compensation 

from the Act will more fully compensate 

victims and allow affected State, local 

and Tribal governments, businesses, 

organizations, and individuals to 

rebuild. 

In this Final Rule, FEMA is updating 

the established process by which 

claimants who were injured as a result 

of the Fire may apply for compensation 

under the Act. FEMA anticipates that 

several of the changes it made from the 

IFR to this Final Rule will lead to 

impacts on costs, benefits, and transfer 

payments. Below, FEMA discusses the 

impact of these changes relative to the 

IFR. Specifically, these changes include 

the following: 

In 44 CFR 296.4, FEMA added ‘‘other 

natural resources’’ to the definition of 

‘‘Subsistence Resources.’’ Expanding the 

definition leads to the potential for 

claimants to receive compensation for 

claims including other natural 

resources; however, FEMA anticipates 

any impact on claim values will be a de 

minimis amount, as the additional 

language is intended to be clarifying in 

nature. In § 296.21(c)(2), FEMA removed 

the formula on compensation for 

destroyed trees and other landscaping. 

Removing this formula leads to the 

potential for claimants to receive higher 

levels of compensation for these claims, 

and therefore, an increase in claims 

values. Section 296.21(e)(3) removes the 

time limit on reimbursements for 

treatment, allowing for claimants to file 

additional claims after April 6, 2024. 

This will potentially lead to an increase 

in the number and value of claims filed 

and awarded as compared to the IFR. 

Claimants will potentially benefit by 

receiving treatment for mental health 

conditions that they would not have 

sought out if their expenses could not be 

reimbursed. In § 296.21(e)(4), FEMA 

extended the deadline for compensation 

from September 20, 2022 to November 

14, 2022 for donations claimants made 

to survivors of the Hermit’s Peak/Calf 

Canyon Fire. This will potentially lead 

to an increase in the number and value 

of claims awarded by FEMA relative to 

the IFR. In § 296.21(e)(5), FEMA 

removed the formula for compensation 

for measures taken to reduce risk from 

natural disasters heightened by the Fire. 

Removing this formula leads to the 

potential for claimants to receive higher 

levels of compensation for these claims, 

and therefore, an increase in claims 

values. FEMA edited § 296.35 to allow 


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Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 59775 

for a claimant to file a claim for 

depreciation after the sale of any real 

property, not only the sale of a home. 

FEMA also extends a deadline in this 

section, allowing for a claimant to 

request to reopen a claim under limited 

circumstances until the deadline 

established in the Federal Register. 

Both of these changes will potentially 

lead to an increase in claims and more 

claims being awarded as compared to 

the IFR. 

All increases in the number or value 

of claims payments in comparison to the 

IFR will lead to an increase in transfer 

payments from FEMA to affected 

recipients. The extent to which the 

claim values increase, recipients will 

benefit by being made more whole after 

their loss, thereby improving their 

ability recover and be resilient. Any 

increase in the number of claims filed 

will also lead to an increase in burden 

hours to claimants and administrative 

costs to FEMA. None of these changes 

will affect the maximum total impact of 

the rule of $3.95 billion. 

C. Regulatory Flexibility Act 

The Regulatory Flexibility Act (RFA) 

(5 U.S.C. 605(b)) applies only to rules 

for which an agency publishes a general 

notice of proposed rulemaking pursuant 

to 5 U.S.C. 553(b). As discussed 

previously, FEMA did not issue a notice 

of proposed rulemaking, and was not 

required to do so under any law. 

Accordingly, the RFA’s requirements do 

not apply to this Final Rule. 

D. Unfunded Mandates Reform Act of 

1995 

As noted above, no notice of proposed 

rulemaking was published in advance of 

this action. Therefore, the written 

statement provisions of the Unfunded 

Mandates Reform Act of 1995, as 

amended, (2 U.S.C. 1501 et seq.) do not 

apply to this regulatory action. 

E. Paperwork Reduction Act of 1995 

This rule contains information 

collections necessary to support FEMA’s 

implementation of the Act. The Notice 

of Loss and Proof of Loss forms (OMB 

Control Number 1660–0155) were 

submitted and approved under OMB’s 

emergency clearance procedures on 

November 14, 2022 to allow FEMA to 

begin accepting claims immediately 

after publication of the IFR. A revision 

of the initial emergency collection was 

approved on February 16, 2023 to 

incorporate additional forms necessary 

to effectively process claims under the 

Act. FEMA is pursuing approval under 

the normal notice and comment process 

for this collection and will publish 

notice in the Federal Register for 

comment before receiving an extension 

of the emergency approval. 

F. Privacy Act 

Under the Privacy Act of 1974, 5 

U.S.C. 552a, an agency must determine 

whether implementation of a regulation 

will result in a system of records. A 

‘‘record’’ is any item, collection, or 

grouping of information about an 

individual that is maintained by an 

agency, including, but not limited to, 

his/her education, financial 

transactions, medical history, and 

criminal or employment history and 

that contains his/her name, or the 

identifying number, symbol, or other 

identifying particular assigned to the 

individual, such as a finger or voice 

print or a photograph. See 5 U.S.C. 

552a(a)(4). A ‘‘system of records’’ is a 

group of records under the control of an 

agency from which information is 

retrieved by the name of the individual 

or by some identifying number, symbol, 

or other identifying particular assigned 

to the individual. An agency cannot 

disclose any record which is contained 

in a system of records except by 

following specific procedures. 

In accordance with DHS policy, 

FEMA has completed a Privacy 

Threshold Analysis (PTA) for this rule. 

DHS has determined that this 

rulemaking does not affect the 1660– 

0155 OMB Control Number’s 

compliance with the E-Government Act 

of 2002 or the Privacy Act of 1974, as 

amended. Specifically, DHS has 

concluded that the 1660–0155 OMB 

Control Number is covered by the DHS/ 

FEMA/PIA–044 National Fire Incident 

Reporting Systems (NFIRS) Privacy 

Impact Assessment (PIA) and the DHS/ 

FEMA/PIA–049 Individual Assistance 

(IA) Program PIA. Additionally, DHS 

has decided that the 1660–0155 OMB 

Control Number is covered by DHS/ 

ALL–004 General Information 

Technology Access Account Records 

System (GITAARS), 77 FR 70792 (Nov. 

27, 2012), and DHS/ALL–013 

Department of Homeland Security 

Claims Records, 73 FR 63987 (Oct. 28, 

2008) System of Records Notices 

(SORNs). 

G. Executive Order 13175, Consultation 

and Coordination With Indian Tribal 

Governments 

Executive Order 13175, ‘‘Consultation 

and Coordination with Indian Tribal 

Governments,’’ 65 FR 67249, November 

9, 2000, applies to agency regulations 

that have Tribal implications, that is, 

regulations that have substantial direct 

effects on one or more Indian Tribes, on 

the relationship between the Federal 

Government and Indian Tribes, or on 

the distribution of power and 

responsibilities between the Federal 

Government and Indian Tribes. Under 

this Executive Order, to the extent 

practicable and permitted by law, no 

agency shall promulgate any regulation 

that has Tribal implications, that 

imposes substantial direct compliance 

costs on Indian Tribal governments, and 

that is not required by statute, unless 

funds necessary to pay the direct costs 

incurred by the Indian Tribal 

government or the Tribe in complying 

with the regulation are provided by the 

Federal Government, or the agency 

consults with Tribal officials. 

FEMA entered into consultation with 

the Indian Tribes that have been 

impacted by the Fire and whose Tribal 

entities or Tribal members have been 

impacted by the Fire during the public 

comment period of the Interim Final 

Rulemaking. The consultation was held 

on December 9, 2022 at 3:00 p.m. The 

concerns raised during that consultation 

are addressed above. 

H. Executive Order 13132, Federalism 

Executive Order 13132, ‘‘Federalism,’’ 

64 FR 43255, August 10, 1999, sets forth 

principles and criteria that agencies 

must adhere to in formulating and 

implementing policies that have 

federalism implications, that is, 

regulations that have ‘‘substantial direct 

effects on the States, on the relationship 

between the national government and 

the States, or on the distribution of 

power and responsibilities among the 

various levels of government.’’ Federal 

agencies must closely examine the 

statutory authority supporting any 

action that would limit the 

policymaking discretion of the States, 

and to the extent practicable, must 

consult with State and local officials 

before implementing any such action. 

FEMA has determined that this 

rulemaking does not have a substantial 

direct effect on the States, on the 

relationship between the national 

government and the States, or on the 

distribution of power and 

responsibilities among the various 

levels of government, and therefore does 

not have federalism implications as 

defined by the Executive Order. FEMA, 

however, met with the State of New 

Mexico on January 10, 2023 to discuss 

the effect of the IFR on the State. The 

transcript from that meeting can be 

found on the public docket at https://

www.regulations.gov/document/FEMA2022-0037-0142 and comments raised 

during that meeting are addressed 

above. 


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59776 Federal Register / Vol. 88, No. 166 / Tuesday, August 29, 2023 / Rules and Regulations 

I. National Environmental Policy Act of 

1969 (NEPA) 

Under Section 102 of the National 

Environmental Policy Act of 1969 

(NEPA), as amended, 42 U.S.C. 4321 et 

seq., an agency must prepare an 

environmental assessment or 

environmental impact statement for any 

major Federal action that significantly 

affects the quality of the human 

environment unless the action can be 

statutorily or categorically excluded. 40 

CFR 1501.1(a), 1501.4. A ‘‘major federal 

action’’ includes new or revised agency 

rules or regulations. 40 CFR 

1508.1(q)(2). A categorical exclusion is 

a category of actions that the Federal 

agency has determined, normally does 

not significantly affect the quality of the 

human environment. 42 U.S.C. 

4336e(1). If there are extraordinary 

circumstances, however, a normally 

excluded action may have a significant 

effect, and if the effect cannot be 

mitigated, further environmental review 

is required. 40 CFR 1501.4. 

This rulemaking is a major Federal 

action subject to NEPA. Based on the 

public comments received, the 

rulemaking revises the IFR to better 

address the needs of the communities 

affected by the Fire with particular 

consideration to their geographic, 

economic and cultural characteristics. 

The purpose of the rulemaking is to 

establish a process and procedures for 

FEMA to expeditiously pay actual 

compensatory damages for injuries 

resulting from the Fire. FEMA has 

determined that categorical exclusion 

A3 included in the list of exclusion 

categories at Department of Homeland 

Security Instruction Manual 023–01– 

001–01, Revision 01, Implementation of 

the National Environmental Policy Act, 

Appendix A, issued November 6, 2014, 

applies to this rulemaking. Specifically, 

categorical exclusion A3 covers the 

promulgation of rules, issuance of 

rulings or interpretations, and the 

development and publication of 

policies, orders, directives, notices, 

procedures, manuals, and advisory 

circulars if they meet certain criteria 

provided in A3(a)–(f). This Final Rule 

meets Categorical Exclusion A3(a), 

‘‘[t]hose of a strictly administrative or 

procedural nature,’’ and A3(b), ‘‘[t]hose 

that implement, without substantive 

change, statutory or regulatory 

requirements.’’ FEMA has determined 

that there are no extraordinary 

circumstances that prevent the use of 

this categorical exclusion for this 

rulemaking action. 

J. Executive Orders 12898 and 14096 on 

Environmental Justice 

Under Executive Order 12898, 

‘‘Federal Actions to Address 

Environmental Justice in Minority 

Populations and Low-Income 

Populations,’’ 59 FR 7629 (Feb. 16, 

1994), as amended by Executive Order 

12948, 60 FR 6381, (Feb. 1, 1995), 

FEMA incorporates environmental 

justice into its policies and programs. 

The Executive Order requires each 

Federal agency to conduct its programs, 

policies, and activities that substantially 

affect human health or the environment 

in a manner that ensures that those 

programs, policies, and activities do not 

have the effect of excluding persons 

from participation in programs, denying 

persons the benefits of programs, or 

subjecting persons to discrimination 

because of race, color, or national origin. 

Further, Executive Order 14096, 

‘‘Revitalizing Our Nation’s Commitment 

to Environmental Justice for All,’’ 88 FR 

25251 (Apr. 26, 2023), charges Federal 

agencies to make achieving 

environmental justice part of their 

missions, consistent with statutory 

authority, by identifying, analyzing, and 

addressing the disproportionate and 

adverse human health and 

environmental effects and hazards of 

Federal activities, including those 

related to climate change and 

cumulative impacts of environmental 

and other burdens on communities with 

environmental justice concerns. 

This rulemaking does not have a 

disproportionate and adverse helath or 

environmental effect on communities, 

nor does it exclude persons from 

participation in FEMA programs, deny 

persons the benefits of FEMA programs, 

or subject persons to discrimination 

because of race, color, or national origin. 

The rulemaking finalizes the IFR and 

establishes the procedures for 

processing and paying claims for 

property, business and other financial 

losses to those person(s) sustaining 

losses from the Fire. The eligibility 

requirements are to ensure the validity 

of the claim for compensation. See e.g., 

44 CFR 296.4 (definition of ‘‘injured 

person’’), 296.20, 296.21, and 296.30. 

With its revisions to the IFR, the 

rulemaking better addresses the needs of 

the communities affected by the Fire 

based on the public comments received 

and the communities’ particular 

geographic, economic, and cultural 

characteristics. Claimants also have 

appeal rights: they can file an 

administrative appeal of the decision by 

the Director of the Claims Office, and/ 

or resolve a dispute through binding 

arbitration or appeal the Director’s 

decision to the United States District 

Court for the District of New Mexico. 

All persons eligible for compensatory 

payments resulting from the Fire will 

benefit. 

K. Congressional Review of Agency 

Rulemaking 

Under the Congressional Review of 

Agency Rulemaking Act (CRA), 5 U.S.C. 

801–808 before a rule can take effect, 

the Federal agency promulgating the 

rule must: submit to Congress and to the 

Government Accountability Office 

(GAO) a copy of the rule; a concise 

general statement relating to the rule, 

including whether it is a major rule; the 

proposed effective date of the rule; a 

copy of any cost-benefit analysis; 

descriptions of the agency’s actions 

under the Regulatory Flexibility Act and 

the Unfunded Mandates Reform Act; 

and any other information or statements 

required by relevant executive orders. 

FEMA has submitted this rule to the 

Congress and to GAO pursuant to the 

CRA. The Office of Management and 

Budget has determined that this rule is 

‘‘economically significant,’’ but this rule 

is not a ‘‘major rule’’ within the 

meaning of the CRA. FEMA believes 

this Final Rule is not subject to the 

additional review requirements under 

the CRA given the statutory mandate to 

issue the Interim Final Rule within 45 

days of the Act’s enactment under 

section 104(f) of the Act and Congress’s 

desire for the agency to begin processing 

and paying claims pursuant to the Act 

expeditiously under section 102(b)(2). 

The changes made in the Final Rule 

need to be immediately effective to 

resolve the comments raised during the 

IFR’s public comment period to the 

claims process and ensure the 

continued expeditious processing and 

payment of claims under the Act. This 

Final Rule is a procedural rule and does 

not confer any substantive rights, 

benefits, or obligations but rather only 

updates the agency’s procedures for 

how to voluntarily file a claim under the 

Act. As such, this Final Rule is a ‘‘rule 

of agency organization, procedure, or 

practice that does not substantially 

affect the rights or obligation of nonagency parties’’ pursuant to 5 U.S.C. 

804(3)(C). Finally, even if this final rule 

is considered a ‘‘rule’’ under the CRA, 

FEMA finds there is good cause to 

dispense with notice and public 

comment under 5 U.S.C. 808(2). Notice 

and public comment are impracticable 

and contrary to public interest given the 

Act’s requirement for the agency to 

publish an IFR within 45 days of 

enactment and the Act’s purpose to 

provide expeditious consideration and 

settlement of claims for victims of the 


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Fire as explained above. Therefore, 

there is no delay in its effective date 

under the CRA. 

List of Subjects in 44 CFR Part 296 

Administrative practice and 

procedure, Claims, Disaster Assistance, 

Federally affected areas, Indians, 

Indians—lands, Indians—Tribal 

government, Organization and functions 

(Government agencies), Public lands, 

Reporting and recordkeeping 

requirements, State and local 

governments. 

■ For the reasons discussed in the 

preamble, the Federal Emergency 

Management Agency (FEMA) is revising 

part 296 to read as follows: 

PART 296—HERMIT’S PEAK/CALF 

CANYON FIRE ASSISTANCE 

Sec. 

Subpart A—General 

296.1 Purpose. 

296.2 Policy. 

296.3 Information and assistance. 

296.4 Definitions. 

296.5 Overview of the claims process. 

296.6–296.9 [Reserved] 

Subpart B—Bringing a Claim Under the 

Hermit’s Peak/Calf Canyon Fire Assistance 

Act 

296.10 Filing a claim under the Hermit’s 

Peak/Calf Canyon Fire Assistance Act 

296.11 Deadline for notifying FEMA of 

injuries. 

296.12 Election of remedies. 

296.13 Subrogation. 

296.14 Assignments. 

296.15–296.19 [Reserved] 

Subpart C—Compensation Available under 

the Hermit’s Peak/Calf Canyon Fire 

Assistance Act 

296.20 Prerequisite to compensation. 

296.21 Allowable damages. 

296.22–296.29 [Reserved] 

Subpart D—Claims Evaluation 

296.30 Establishing injuries and damages. 

296.31 Reimbursement of claim expenses. 

296.32 Determination of compensation due 

to claimant. 

296.33 Partial payments. 

296.34 Supplementing claims. 

296.35 Reopening a claim. 

296.36 Access to records. 

296.37 Confidentiality of information. 

296.38–296.39 [Reserved] 

Subpart E—Dispute Resolution 

296.40 Scope. 

296.41 Administrative appeal. 

296.42 Arbitration. 

296.43 Judicial review. 

Authority: Pub. L. 117–180, 136 Stat. 2114, 

2168; Homeland Security Act of 2002, 6 

U.S.C. 101 et seq. 

Subpart A—General 

§ 296.1 Purpose. 

This part implements the Hermit’s 

Peak/Calf Canyon Fire Assistance Act 

(Act), Division G of Public Law 117– 

180, 136 Stat. 2114, 2168, which 

requires the Federal Emergency 

Management Agency (FEMA) to 

establish the Office of Hermit’s Peak/ 

Calf Canyon Fire Claims (‘‘Claims 

Office’’) to receive, evaluate, process, 

and pay actual compensatory damages 

for injuries resulting from the Hermit’s 

Peak/Calf Canyon Fire. 

§ 296.2 Policy. 

It is our policy to provide for the 

expeditious resolution of damage claims 

through a process that is administered 

with sensitivity to the burdens placed 

upon claimants by the Hermit’s Peak/ 

Calf Canyon Fire. 

§ 296.3 Information and assistance. 

Information and assistance 

concerning the Act is available from the 

Claims Office, Federal Emergency 

Management Agency online at https://

www.fema.gov/hermits-peak. 

§ 296.4 Definitions. 

Administrative Appeal means an 

appeal of the Authorized Official’s 

Determination to the Director of the 

Claims Office in accordance with the 

provisions of Subpart E of this part. 

Administrative Record means all 

information submitted by the claimant 

and all information collected by FEMA 

concerning the claim, which is used to 

evaluate the claim and to formulate the 

Authorized Official’s Determination. It 

also means all information that is 

submitted by the claimant or FEMA in 

an Administrative Appeal and the 

decision of the Administrative Appeal. 

It excludes the opinions, memoranda 

and work papers of FEMA attorneys and 

drafts of documents prepared by Claims 

Office personnel and contractors. 

Administrator means the 

Administrator of the Federal Emergency 

Management Agency. 

Arbitration Administrator means the 

FEMA official responsible for 

administering arbitration procedures to 

resolve disputes regarding a claim. 

Contact information for the Arbitration 

Administrator can be found online at 

https://www.fema.gov/hermits-peak. 

Authorized Official means an 

employee of the United States who is 

delegated with authority by the Director 

of the Claims Office to render binding 

determinations on claims and to 

determine compensation due to 

claimants under the Act. 

Authorized Official’s Determination 

means a report signed by an Authorized 

Official and mailed to the claimant 

evaluating each element of the claim as 

stated in the Proof of Loss and 

determining the compensation, if any, 

due to the claimant. 

Claimant means a person who has 

filed a Notice of Loss under the Act. 

Claims Office means the Office of 

Hermit’s Peak/Calf Canyon Fire Claims. 

Claims Reviewer means an employee 

of the United States or a Claims Office 

contractor or subcontractor who is 

authorized by the Director of the Claims 

Office to review and evaluate claims 

submitted under the Act. 

Days means calendar days, including 

weekends and holidays. 

Director means an Independent 

Claims Manager appointed by the 

Administrator who will serve as the 

Director of the Claims Office. 

Good Cause, for purposes of 

extending the deadline for filing, 

supplementing a claim, or reopening a 

claim includes, but is not limited to: 

instances where a claimant, through no 

fault of their own, may not be able to 

access needed documentation in time to 

submit a claim or transmit relevant 

information or data; or where damage is 

found after a claim has been submitted; 

or other instances in which the Director 

of the Claims Office, in their discretion, 

determines that an undue hardship or 

change in circumstances on the 

claimant warrants an extension of a 

deadline or the supplementation or 

reopening of existing claims. 

Hermit’s Peak/Calf Canyon Fire 

means: 

(1) The fire resulting from the 

initiation by the U.S. Forest Service of 

a prescribed burn in the Santa Fe 

National Forest in San Miguel County, 

New Mexico on April 6, 2022; 

(2) The pile burn holdover resulting 

from the prescribed burn by the U.S. 

Forest Services which reemerged on 

April 19, 2022; and 

(3) The merger of the two fires 

described in paragraphs (1) and (2) of 

this definition, reported as the Hermit’s 

Peak Fire or the Hermit’s Peak Fire/Calf 

Canyon Fire. 

Household means a group of people, 

related or unrelated, who live together 

on a continuous basis and does not 

include members of an extended family 

who do not regularly and continuously 

cohabit. 

Household Including Tribal Members 

means a Household that existed on 

April 6, 2022, which included one or 

more Tribal Members as continuous 

residents. 

Indian Tribe means the recognized 

governing body of any Indian or Alaska 

Native Tribe, band, nation, pueblo, 

village, community, component band, or 


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components reservation individually 

identified (including parenthetically) in 

the list published most recently as of 

September 30, 2022, pursuant to section 

104 of the Federally Recognized Indian 

Tribe List Act of 1994. 

Individual Assistance means the 

FEMA program established under 

subchapter IV of the Robert T. Stafford 

Disaster Relief and Emergency 

Assistance Act, as amended, 42 U.S.C. 

5121, et seq., which provides assistance 

to individuals and families adversely 

affected by a major disaster or an 

emergency. 

Injured Person means an individual, 

regardless of citizenship or alien status; 

or an Indian Tribe, Tribal corporation, 

corporation, partnership, company, 

association, county, township, city, 

State, school district, or other nonFederal entity that suffered injury 

resulting from the Hermit’s Peak/Calf 

Canyon Fire. The term Injured Person 

includes an Indian Tribe with respect to 

any claim relating to property or natural 

resources held in trust for the Indian 

Tribe by the United States. Lenders 

holding mortgages or security interests 

on property affected by the Hermit’s 

Peak/Calf Canyon Fire and lien holders 

are not an ‘‘Injured Person’’ for purposes 

of the Act. 

Injury means ‘‘injury or loss of 

property, or personal injury or death,’’ 

as used in the Federal Tort Claims Act, 

28 U.S.C. 1346(b)(1). 

Notice of Loss means a form supplied 

by the Claims Office through which an 

Injured Person or Subrogee makes a 

claim for possible compensation under 

the Act. 

Proof of Loss means a statement 

attesting to the nature and extent of the 

claimant’s injuries. 

Public Assistance Program means the 

FEMA program established under 

Subchapter IV of the Robert T. Stafford 

Disaster Relief and Emergency 

Assistance Act, as amended, 42 U.S.C. 

5121, et seq., which provides grants to 

States, local governments, Indian Tribes 

and private nonprofit organizations for 

emergency measures and repair, 

restoration, and replacement of 

damaged facilities. 

Release and Certification Form means 

a document in the manner prescribed by 

section 104(e) of the Act that all 

claimants who have received or are 

awarded compensatory damages under 

the Act must execute and return to the 

Claims Office as required by § 296.30(c). 

Subrogee means an insurer or other 

third party that has paid to a claimant 

compensation for Injury and is 

subrogated to any right that the claimant 

has to receive payment under the Act. 

Subsistence Resources means food 

and other items obtained through 

hunting, fishing, firewood and other 

natural resource gathering, timbering, 

grazing or agricultural activities 

undertaken by the claimant without 

financial remuneration, on land 

damaged by the Hermit’s Peak/Calf 

Canyon Fire. 

Tribal Member means an enrolled 

member of an Indian Tribe. 

§ 296.5 Overview of the claims process. 

(a) The Act is intended to provide 

persons who suffered Injury from the 

Hermit’s Peak/Calf Canyon Fire with a 

simple, expedited process to seek 

compensation from the United States. 

This section provides a brief 

explanation of the claims process for 

claims other than subrogation claims. It 

is not intended to supersede the more 

specific regulations that follow and 

explain the claims process in greater 

detail. To obtain compensation under 

the Act, an Injured Person must submit 

all Hermit’s Peak/Calf Canyon Fire 

related claims against the United States 

or any employee, officer, or agency of 

the United States to the FEMA Claims 

Office. An Injured Person who elects to 

accept an award under the Act is barred 

from accepting an award pursuant to a 

claim under the Federal Tort Claims Act 

or a civil action against the United 

States or any employee, officer, or 

agency of the United States arising out 

of or relating to the same subject matter. 

Judicial review of FEMA decisions 

under the Act is available. 

(b) The first step in the process is to 

file a Notice of Loss with the Claims 

Office. The Claims Office will provide 

the claimant with a written 

acknowledgement that the claim has 

been filed and a claim number. 

(c) Shortly thereafter, a Claims 

Reviewer will contact the claimant to 

review the claim. Claims Reviewer will 

help the claimant formulate a strategy 

for obtaining any necessary 

documentation or other support. This 

assistance does not relieve the claimant 

of their responsibility for establishing 

all elements of the injuries and the 

compensatory damages that are sought, 

including that the Hermit’s Peak/Calf 

Canyon Fire caused the injuries. After 

the claimant has had an opportunity to 

discuss the claim with the Claims 

Reviewer, a Proof of Loss will be 

presented to the claimant for signature. 

After any necessary documentation has 

been obtained and the claim has been 

fully evaluated, the Claims Reviewer 

will submit a report to the Authorized 

Official. The Claims Reviewer is 

responsible for providing an objective 

evaluation of the claim to the 

Authorized Official. 

(d) The Authorized Official will 

review the report and determine 

whether compensation is due to the 

claimant. The claimant will be notified 

in writing of the Authorized Official’s 

determination. If the claimant is 

satisfied with the decision, payment 

will be made after the claimant returns 

a completed Release and Certification 

Form. If the claimant is dissatisfied with 

the Authorized Official’s determination, 

an administrative appeal may be filed 

with the Director of the Claims Office. 

If the claimant remains dissatisfied after 

the appeal is decided, the dispute may 

be resolved through binding arbitration 

or heard in the United States District 

Court for the District of New Mexico. 

§§ 296.6–296.9 [Reserved] 

Subpart B—Bringing a Claim Under the 

Hermit’s Peak/Calf Canyon Fire 

Assistance Act 

§ 296.10 Filing a claim under the Hermit’s 

Peak/Calf Canyon Fire Assistance Act. 

(a) Any Injured Person may bring a 

claim under the Act by filing a Notice 

of Loss. A claim submitted on any form 

other than a Notice of Loss will not be 

accepted. The claimant must provide a 

brief description of each injury on the 

Notice of Loss. 

(b) A single Notice of Loss may be 

submitted on behalf of a household 

containing Injured Persons provided 

that all Injured Persons on whose behalf 

the claim is presented are identified. 

(c) The Notice of Loss must be signed 

by each claimant, if the claimant is an 

individual, or by a duly authorized legal 

representative of each claimant, if the 

claimant is an entity or an individual 

who lacks the legal capacity to sign the 

Notice of Loss. If one is signing a Notice 

of Loss as the legal representative of a 

claimant, the signer must disclose their 

relationship to the claimant. FEMA may 

require a legal representative to submit 

evidence of their authority to act. 

(d) The Claims Office will provide 

Notice of Loss forms through the mail, 

electronically, in person at the Claims 

Office or by telephone request. The 

Notice of Loss form can also be 

downloaded from the internet at https:// 

www.fema.gov/hermits-peak. 

(e) A Notice of Loss may be filed with 

the Claims Office by mail, 

electronically, or in person. Details 

regarding the filing process can be 

found at https://www.fema.gov/hermitspeak. 

(f) A Notice of Loss that is completed 

and properly signed is deemed to be 

filed on the date it is received and 

acknowledged by the Claims Office. 


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§ 296.11 Deadline for notifying FEMA of 

injuries. 

The deadline for filing a Notice of 

Loss is November 14, 2024. Except as 

provided in § 296.35 with respect to a 

request to reopen a claim, an injury that 

has not been described: on a Notice of 

Loss, on a supplement to a Notice of 

Loss or a request to supplement a Notice 

of Loss under § 296.34 received by the 

Claims Office on or before November 14, 

2024 cannot be compensated under the 

Act. The Act establishes this deadline 

and does not provide any extensions of 

the filing deadline. 

§ 296.12 Election of remedies. 

(a) An Injured Person who accepts a 

final award under the Act waives the 

right to pursue all claims for injuries 

arising out of or relating to the same 

subject matter against the United States 

or any employee, officer, or agency of 

the United States through the Federal 

Tort Claims Act or a civil action 

authorized by any other provision of 

law. 

(b) An Injured Person who accepts a 

final award through a Federal Tort 

Claims Act claim or a civil action 

against the United States or any 

employee, officer, or agency of the 

United States relating to the Hermit’s 

Peak/Calf Canyon Fire waives the right 

to pursue any claim arising out of or 

relating to the same subject matter 

under the Act. 

§ 296.13 Subrogation. 

An insurer or other third party with 

the rights of a subrogee, who has 

compensated an injured person for 

Hermit’s Peak/Calf Canyon Fire related 

injuries, may file a Notice of Loss under 

the Act for the subrogated claim. A 

subrogee may file a Notice of Loss 

without regard to whether the Injured 

Person who received payment from the 

subrogee filed a Notice of Loss. A 

Subrogation Notice of Loss should be 

filed after the subrogee has made all 

payments that it believes the Injured 

Person is entitled to receive for Hermit’s 

Peak/Calf Canyon Fire related injuries 

under the terms of the insurance policy 

or other agreement between the 

subrogee and the Injured Person, but not 

later than November 14, 2024. By filing 

a Notice of Loss for any subrogated 

claim, the subrogee elects the Act as its 

exclusive remedy against the United 

States or any employee, officer, or 

agency of the United States for all 

subrogated claims arising out of the 

Hermit’s Peak/Calf Canyon Fire. 

Subrogation claims must be made on a 

Notice of Loss form furnished by the 

Claims Office and such claims will be 

paid only after paying claims submitted 

by injured persons that are not 

insurance companies seeking payment 

as subrogees. 

§ 296.14 Assignments. 

Assignment of claims and the right to 

receive compensation for claims under 

the Act is prohibited and will not be 

recognized by FEMA. 

§§ 296.15–296.19 [Reserved] 

Subpart C—Compensation Available 

Under the Hermit’s Peak/Calf Canyon 

Fire Assistance Act 

§ 296.20 Prerequisite to compensation. 

In order to receive compensation 

under the Act, a claimant must be an 

Injured Person who suffered an injury as 

a result of the Hermit’s Peak/Calf 

Canyon Fire and sustained damages. 

§ 296.21 Allowable damages. 

(a) Allowable damages. The Act 

provides for the payment of actual 

compensatory damages for injury or loss 

of property, business loss, and financial 

loss. The laws of the State of New 

Mexico will apply to the calculation of 

damages. Damages must be reasonable 

in amount. 

(b) Exclusions. Punitive damages, 

statutory damages under section 30–32– 

4 of the New Mexico Statutes Annotated 

(2019), interest on claims, attorney’s 

fees and agents’ fees incurred in 

prosecuting a claim under the Act or an 

insurance policy, and adjusting costs 

incurred by an insurer or other third 

party with the rights of a subrogee that 

may be owed by a claimant as a 

consequence of receiving an award are 

not recoverable from FEMA. The cost to 

a claimant of prosecuting a claim under 

the Act does not constitute 

compensatory damages and is not 

recoverable from FEMA, except as 

provided in § 296.31(b). 

(c) Loss of property. Compensatory 

damages may be awarded for an 

uninsured or underinsured property 

loss, a decrease in the value of real 

property, damage to physical 

infrastructure, cost resulting from lost 

subsistence, cost of reforestation or 

revegetation not covered by any other 

Federal program, and any other loss that 

the Administrator determines to be 

appropriate for inclusion as a loss of 

property. 

(1) Real property and contents. 

Compensatory damages for the damage 

or destruction of real property and its 

contents may include the reasonable 

cost of reconstruction of a structure 

comparable in design, construction 

materials, size, and improvements, 

taking into account post-fire 

construction costs in the community in 

which the structure existed before the 

fire and current building codes and 

standards. Compensatory damages may 

also include the cost of removing debris 

and burned trees, including hazardous 

materials or soils, stabilizing the land, 

replacing contents, and compensation 

for any decrease in the value of land on 

which the structure sat pursuant to 

paragraph (c)(3) of this section. 

(2) Reforestation and revegetation. 

Compensatory damages may be awarded 

for the cost of replacement of destroyed 

trees and landscaping. 

(3) Decrease in the value of real 

property. Compensatory damages may 

be awarded for a decrease in the value 

of real property that a claimant owned 

before the Hermit’s Peak/Calf Canyon 

Fire if: 

(i) The claimant sells the real property 

in a good faith, arm’s length transaction 

that is closed no later than November 

14, 2024 and realizes a loss in the prefire value; or 

(ii) The claimant can establish that the 

value of the real property was 

significantly diminished long-term as a 

result of the Hermit’s Peak/Calf Canyon 

Fire. 

(4) Subsistence. Compensatory 

damages will be awarded for lost 

Subsistence Resources. 

(i) FEMA may reimburse an injured 

party for the reasonable cost of replacing 

Subsistence Resources customarily and 

traditionally used by the claimant on or 

before April 6, 2022, but no longer 

available to the claimant as a result of 

the Hermit’s Peak/Calf Canyon Fire. For 

each category of Subsistence Resources, 

the claimant must elect to receive 

compensatory damages either for the 

increased cost of obtaining Subsistence 

Resources from lands not damaged by 

the Hermit’s Peak/Calf Canyon Fire or 

for the cost of procuring substitute 

resources in the cash economy. 

(ii) FEMA may consider evidence 

submitted by claimants, Indian Tribes, 

and other knowledgeable sources in 

determining the nature and extent of a 

claimant’s subsistence uses. 

(iii) Compensatory damages for 

subsistence losses will be paid for the 

period between April 6, 2022 and the 

date when Subsistence Resources can 

reasonably be expected to return to the 

level of availability that existed before 

the Hermit’s Peak/Calf Canyon Fire. 

FEMA may rely upon the advice of 

experts in making this determination. 

(iv) Long-term damage awards for 

subsistence resources will be made to 

claimants in the form of lump sum cash 

payments. 

(5) Physical infrastructure. 

Compensatory damages may be awarded 

for the damage to physical 


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infrastructure, including damages to 

irrigation infrastructure such as acequia 

systems. 

(d) Business loss. Compensatory 

damages may be awarded for damage to 

tangible assets or inventory, including 

timber, crops, and other natural 

resources; business interruption losses; 

overhead costs; employee wages for 

work not performed; loss of business net 

income; and any other loss that the 

Administrator determines to be 

appropriate for inclusion as a business 

loss. 

(e) Financial loss. Compensatory 

damages may be awarded for increased 

mortgage interest costs, insurance 

deductibles, temporary living or 

relocation expenses, lost wages or 

personal income, emergency staffing 

expenses, debris removal and other 

cleanup costs, costs of reasonable 

heightened risk reduction, premiums for 

flood insurance, and any other loss that 

the Administrator determines to be 

appropriate for inclusion as financial 

loss. 

(1) Recovery loans. FEMA will 

reimburse claimants awarded 

compensation under the Act for interest 

paid on loans, including Small Business 

Administration disaster loans obtained 

after April 6, 2022 for damages resulting 

from the Fire. Interest will be 

reimbursed for the period beginning on 

the date that the loan was taken out and 

ending on the date when the claimant 

receives a compensation award (other 

than a partial payment). Claimants are 

required to use the proceeds of their 

compensation award to repay Small 

Business Administration disaster loans. 

FEMA will cooperate with the Small 

Business Administration to formulate 

procedures for assuring that claimants 

repay Small Business Administration 

disaster loans contemporaneously with 

the receipt of their compensation award. 

(2) Flood insurance. FEMA will 

reimburse claimants for flood insurance 

premiums to be paid on or before May 

31, 2024 if, as a result of the Hermit’s 

Peak/Calf Canyon Fire, a claimant who 

was not required to purchase flood 

insurance before the Hermit’s Peak/Calf 

Canyon Fire is required to purchase 

flood insurance or the claimant did not 

maintain flood insurance before the Fire 

but purchased flood insurance after the 

Fire due to fear of heightened flood risk. 

Alternatively, FEMA may provide flood 

insurance to such claimants directly 

through a group or blanket policy. 

(3) Out of pocket expenses for 

treatment of mental health conditions. 

FEMA may reimburse an individual 

claimant for reasonable out of pocket 

expenses incurred for treatment of a 

mental health condition rendered by a 

licensed mental health professional, 

which condition resulted from or was 

worsened by the Hermit’s Peak/Calf 

Canyon Fire. FEMA will not reimburse 

for treatment identified after November 

14, 2024 

(4) Donations. FEMA will compensate 

claimants for the cost of merchandise, 

use of equipment or other non-personal 

services, directly or indirectly donated 

to survivors of the Hermit’s Peak/Calf 

Canyon Fire not later than November 

14, 2022. Donations will be valued at 

cost. 

(5) Heightened risk reduction. FEMA 

will reimburse claimants for the costs 

incurred to implement reasonable 

measures necessary to reduce risks from 

natural hazards heightened by the 

Hermit’s Peak/Calf Canyon Fire to the 

level of risk prevailing before the 

Hermit’s Peak/Calf Canyon Fire. Such 

measures may include, for example, risk 

reduction projects that reduce an 

increased risk from flooding, mudslides, 

and landslides in and around burn 

scars. Claimants seeking compensation 

for heightened risk reduction must 

include the claim in their Notice of Loss 

by November 14, 2024 or an amended 

Notice of Loss filed no later than 

November 14, 2025. Claimants should 

take into account current building codes 

and standards and must complete the 

risk reduction project for which they 

receive compensation. 

(f) Insurance and other benefits. The 

Act allows FEMA to compensate Injured 

Persons only for damages not paid, and 

that will not be paid, by insurance or 

other third-party payments or 

settlements. 

(1) Insurance. Claimants who carry 

insurance will be required to disclose 

the name of the insurer(s) and the 

nature of the insurance and provide the 

Claims Office with such insurance 

documentation as the Claims Office 

reasonably requests. 

(2) Coordination with FEMA’s Public 

Assistance Program. Injured Persons 

eligible for disaster assistance under 

FEMA’s Public Assistance Program are 

expected to apply for all available 

assistance. Pursuant to the Act, the 

Federal share of the costs for Public 

Assistance projects is 100 percent. 

Compensation will not be awarded 

under the Act for injuries or costs that 

are eligible under the Public Assistance 

Program. 

(3) Benefits provided by FEMA’s 

Individual Assistance program. 

Compensation under the Act will not be 

awarded for injuries or costs that have 

been reimbursed under the Federal 

Assistance to Individual and 

Households Program or any other FEMA 

Individual Assistance Program. 

(4) Worker’s compensation claims. 

Individuals who have suffered injuries 

that are compensable under State or 

Federal worker’s compensation laws 

must apply for all benefits available 

under such laws. 

(5) Benefits provided by nongovernmental organizations and 

individuals. Gifts or donations made to 

a claimant by a non-governmental 

organization or an individual, other 

than wages paid by the claimant’s 

employer or insurance payments, will 

be disregarded in evaluating claims and 

need not be disclosed to the Claims 

Office by claimants. 

§ 296.22–296.29 [Reserved] 

Subpart D—Claims Evaluation 

§ 296.30 Establishing injuries and 

damages. 

(a) Burden of proof. The burden of 

proving injuries and damages rests with 

the claimant. A claimant may submit for 

the Administrative Record a statement 

explaining why the claimant believes 

that the injuries and damages are 

compensable and any documentary 

evidence supporting the claim. 

Claimants will provide documentation, 

which is reasonably available, including 

photographs and video, to corroborate 

the nature, extent, and value of their 

injuries and/or to execute affidavits in a 

form established by the Claims Office. 

FEMA may compensate a claimant for 

an injury in the absence of supporting 

documentation, in its discretion, on the 

strength of an affidavit or Proof of Loss 

executed by the claimant, if 

documentary evidence substantiating 

the injury is not reasonably available. 

FEMA may also require an inspection of 

real property. FEMA may request that a 

business claimant execute an affidavit, 

which states that the claimant will 

provide documentary evidence, 

including but not limited to income tax 

returns, if requested by the DHS Office 

of the Inspector General or the 

Government Accountability Office 

during an audit of the claim. 

(b) Proof of Loss. All claimants are 

required to attest to the nature and 

extent of each injury for which 

compensation is sought in the Proof of 

Loss. The Proof of Loss, which will be 

in a form specified by the Claims Office, 

must be signed by the claimant or the 

claimant’s legal representative if the 

claimant is not an individual or is an 

individual who lacks the legal capacity 

to execute the Proof of Loss. The Proof 

of Loss must be signed under penalty of 

perjury. Non-subrogation claimants 

should submit a signed Proof of Loss to 

the Claims Office not later than 150 

days after the date when the Notice of 


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Loss was submitted. This deadline may 

be extended at the discretion of the 

Director of the Claims Office for good 

cause. If a non-subrogation claimant 

fails to submit a signed Proof of Loss 

within the timeframes set forth in this 

section and does not obtain an 

extension from the Director of the 

Claims Office, the Claims Office may 

administratively close the claim and 

require the claimant to repay any partial 

payments made on the claim. 

Subrogation claimants will submit the 

Proof of Loss contemporaneously with 

filing the Notice of Loss. 

(c) Release and Certification Form. All 

claimants who receive compensation 

under the Act are required to sign a 

Release and Certification Form, 

including for partial payments under 

§ 296.33. The Release and Certification 

Form must be executed by the claimant 

or the claimant’s legal representative if 

the claimant is an entity or lacks the 

legal capacity to execute the Release and 

Certification Form. A Release and 

Certification Form must be received by 

the Claims Office before the Claims 

Office provides payment on the claim. 

The United States will not attempt to 

recover compensatory damages paid to 

a claimant who has executed and 

returned a Release and Certification 

Form within the periods provided 

above, except in the case of fraud or 

misrepresentation by the claimant or the 

claimant’s representative, failure of the 

claimant to cooperate with an audit as 

required by § 296.36 or a material 

mistake by FEMA. 

(d) Authority to settle or compromise 

claims. Notwithstanding any other 

provision of this part, the Director of the 

Claims Office may extend an offer to 

settle or compromise a claim or any 

portion of a claim at any time during the 

process outlined in this part, which if 

accepted by the claimant will be 

binding on the claimant and on the 

United States, except that the United 

States may recover funds improperly 

paid to a claimant due to fraud or 

misrepresentation on the part of the 

claimant or the claimant’s 

representative, a material mistake on 

FEMA’s part or the claimant’s failure to 

cooperate in an audit as required by 

§ 296.36. 

§ 296.31 Reimbursement of claim 

expenses. 

(a) FEMA will reimburse claimants for 

the reasonable costs they incur in 

providing documentation requested by 

the Claims Office. FEMA will also 

reimburse claimants for the reasonable 

costs they incur in providing appraisals, 

or other third-party opinions that the 

Claims Office deems necessary to 

determine the amount of the claim. 

FEMA will not reimburse claimants for 

the cost of appraisals or other thirdparty opinions not deemed necessary by 

the Claims Office. 

(b) FEMA will provide a lump sum 

payment for incidental expenses 

incurred in claims preparation to 

claimants that are awarded 

compensatory damages under the Act 

after a properly executed Release and 

Certification Form has been returned to 

the Claims Office. The amount of the 

lump sum payment will be the greater 

of $150 or 5% of the Act’s compensatory 

damages and insurance proceeds 

recovered by the claimant for Hermit’s 

Peak/Calf Canyon Fire related injuries 

(not including the lump sum payment 

or monies reimbursed under the Act for 

the purchase of flood insurance) but 

will not exceed $25,000. Subrogation 

claimants and claimants whose only 

Hermit’s Peak/Calf Canyon Fire related 

loss is for flood insurance premiums 

will not be eligible. 

§ 296.32 Determination of compensation 

due to claimant. 

(a) Authorized Official’s report. After 

the Claims Office has evaluated all 

elements of a claim as stated in the 

Proof of Loss, the Authorized Official 

will issue, and provide the claimant 

with a copy of, the Authorized Official’s 

determination. 

(b) Claimant’s options upon issuance 

of the Authorized Official’s 

determination. Not later than 120 days 

after the date that appears on the 

Authorized Official’s determination, the 

claimant must either accept the 

determination by submitting a Release 

and Certification Form to FEMA and/or 

initiate an Administrative Appeal in 

accordance with § 296.41. Claimants 

must sign the Release and Certification 

Form to receive payment on their claims 

(including for partial payments). The 

claimant will receive payment of 

compensation awarded by the 

Authorized Official after FEMA receives 

the completed Release and Certification 

Form. If the claimant does not either 

submit a Release and Certification Form 

to FEMA or initiate an Administrative 

Appeal no later than 120 days after the 

date that appears on the Authorized 

Official’s determination, the claimant 

will be conclusively presumed to have 

accepted the Authorized Official’s 

determination. The Director of the 

Claims Office may modify the deadlines 

set forth in this subsection at the request 

of a claimant for good cause shown. 

§ 296.33 Partial payments. 

The Claims Office at the request of a 

claimant may make one or more partial 

payments on any aspect of a claim that 

is severable. Receipt by a claimant of a 

partial payment is contingent on the 

claimant signing a Release and 

Certification Form for the severable part 

of the claim for which partial payment 

is being made. Acceptance of a partial 

payment in no way affects a claimant’s 

ability to pursue an Administrative 

Appeal of the Authorized Official’s 

determination or to pursue other rights 

afforded by the Act with respect to any 

portion of a claim for which a Release 

and Certification Form has not been 

executed. The Claims Office decision on 

whether to provide a partial payment 

cannot be appealed. 

§ 296.34 Supplementing claims. 

A claimant may amend the Notice of 

Loss to include additional claims at any 

time before signing a Proof of Loss. After 

the claimant has submitted a Proof of 

Loss and before submission of a Release 

and Certification Form, a claimant may 

request that the Director of the Claims 

Office consider one or more injuries not 

addressed in the Proof of Loss. The 

request must be submitted in writing to 

the Director of the Claims Office and 

received not later than the deadline for 

filing an Administrative Appeal under 

§ 296.32 or November 14, 2024, 

whichever is earlier. It must be 

supported by the claimant’s explanation 

of why the injury was not previously 

reported. If good cause is found to 

consider the additional injury, the 

Director will determine whether 

compensation is due to the claimant for 

the Loss under the Administrative 

Appeal procedures described in 

§ 296.41. 

§ 296.35 Reopening a claim. 

The Director of the Claims Office may 

reopen a claim if requested to do so by 

the claimant, notwithstanding the 

submission of the Release and 

Certification Form, for the limited 

purpose of considering issues raised by 

the request to reopen if, not later than 

November 14, 2025, the claimant desires 

heightened risk reduction compensation 

in accordance with § 296.21(e)(5) or the 

claimant closed the sale of real property 

and wishes to present a claim for 

decrease in the value of the real 

property under § 296.21(c)(3). Claimants 

may request to reopen claims where the 

claimant has incurred additional losses 

under § 296.21(c)(1) as part of a 

reconstruction in excess of those 

previously awarded or the Director of 

the Claims Office otherwise determines 

that claimant has demonstrated good 

cause no later than the deadline 

established by the Director of the Claims 

Office as published in the Federal 


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Register and at https://www.fema.gov/ 

hermits-peak. 

§ 296.36 Access to records. 

For purpose of audit and 

investigation, a claimant will grant the 

DHS Office of the Inspector General and 

the Comptroller General of the United 

States access to any property that is the 

subject of a claim and to any and all 

books, documents, papers, and records 

(including any relevant tax records) 

maintained by a claimant or under the 

claimant’s control pertaining or relevant 

to the claim. 

§ 296.37 Confidentiality of information. 

Confidential information submitted 

by individual claimants is protected 

from disclosure to the extent permitted 

by the Privacy Act. These protections 

are described in the Privacy Act Notice 

provided with the Notice of Loss. Other 

claimants should consult with FEMA 

concerning the availability of 

confidentiality protection under 

exemptions to the Freedom of 

Information Act and other applicable 

laws before submitting confidential, 

proprietary or trade secret information. 

§ 296.38–296.39 [Reserved] 

Subpart E—Dispute Resolution 

§ 296.40 Scope. 

This subpart describes a claimant’s 

right to bring an Administrative Appeal 

in response to the Authorized Official’s 

Determination. It also describes the 

claimant’s right to pursue arbitration or 

seek judicial review following an 

Administrative Appeal. 

§ 296.41 Administrative appeal. 

(a) Notice of appeal. A claimant may 

request that the Director of the Claims 

Office review the Authorized Official’s 

determination by written request to the 

Appeals Docket, Office of Hermit’s 

Peak/Calf Canyon Claims, postmarked 

or delivered within 120 days after the 

date that appears on the Authorized 

Official’s determination pursuant to 

§ 296.32. The claimant will submit 

along with the notice of appeal a 

statement explaining why the 

Authorized Official’s determination was 

incorrect. Information regarding where 

to file can be found at http://

www.fema.gov/hermits-peak. 

(b) Acknowledgement of appeal. The 

Claims Office will acknowledge receipt 

of an appeal. Following the receipt of a 

timely filed appeal, the Director of the 

Claims Office will obtain the 

Administrative Record from the 

Authorized Official and transmit a copy 

to the claimant. 

(c) Supplemental filings. The claimant 

may supplement their statement 

accompanying the appeal and provide 

any additional documentary evidence 

supporting the appeal within 60 days 

after the date when the appeal is filed. 

The Director of the Claims Office may 

extend these timeframes or authorize 

additional filings either on their own 

initiative or in response to a request by 

the claimant for good cause shown. 

(d) Admissible evidence. The claimant 

may rely upon any relevant evidence to 

support the appeal, regardless of 

whether the evidence was previously 

submitted to the Claims Reviewer for 

consideration by the Authorized 

Official. 

(e) Obtaining evidence. The Director 

of the Claims Office may request from 

the claimant or from the Authorized 

Official any additional information that 

is relevant to the issues posed by the 

appeal in their discretion. 

(f) Conferences. The Director of the 

Claims Office may schedule a 

conference to gain a better 

understanding of the issues or to 

explore settlement or compromise 

possibilities. The claimant may also 

request a conference. Conferences will 

generally be conducted virtually. In 

limited circumstances, the Director may 

convene an in-person conference at a 

location in New Mexico designated by 

the Director. A claimant may request 

that the Director of the Claims Office 

appoint a mediator at FEMA’s expense 

to facilitate such conferences. 

(g) Hearings. The Director of the 

Claims Office may exercise the 

discretion to convene an informal 

hearing to receive oral testimony from 

witnesses or experts. The rules under 

which hearings will be conducted will 

be established by the Director of the 

Claims Office and provided to the 

claimant. Formal rules of evidence 

applicable to court proceedings will not 

be used in hearings under this 

subsection. Hearings will generally be 

conducted virtually, be transcribed, and 

the transcript will be entered in the 

Administrative Record. In limited 

circumstances, the Director may 

convene an in-person hearing at a 

location in New Mexico designated by 

the Director. 

(h) Decision on appeal. After the 

allotted time for submission of evidence 

has passed, the Director of the Claims 

Office will close the Administrative 

Record and render a written decision on 

the Administrative Appeal. The Director 

of the Claims Office’s decision on the 

Administrative Appeal will constitute 

the final decision of the Administrator 

of FEMA under sections 104(d)(2)(B) 

and 104(i)(1) of the Act. 

(i) Claimant’s options following 

appeal. The claimant’s concurrence 

with the decision in the Administrative 

Appeal will be conclusively presumed 

unless the claimant initiates arbitration 

in accordance with § 296.42 or seeks 

judicial review in accordance with 

§ 296.43. If the claimant concurs with 

the Director’s determination, payment of 

any additional damages awarded by the 

Director will be made to the claimant 

upon receipt of a properly executed 

Release and Certification Form. 

§ 296.42 Arbitration. 

(a) Initiating arbitration. A claimant 

who is dissatisfied with the outcome of 

the Administrative Appeal may elect to 

submit the dispute to a binding 

arbitration process. A claimant may 

initiate arbitration by submitting a 

written request to the Arbitration 

Administrator for Hermit’s Peak/Calf 

Canyon Claims. Additional information 

regarding how to submit a written 

arbitration request can be found at 

http://www.fema.gov/hermits-peak. The 

written request for arbitration must be 

electronically stamped or postmarked 

no later than 60 days after the date that 

appears on the Administrative Appeal 

decision. 

(b) Permissible claims. A claimant 

may not arbitrate an issue unless it was 

raised and decided in the 

Administrative Appeal. Arbitration will 

be conducted on the evidence in the 

Administrative Record. Evidence not 

previously entered into the 

Administrative Record will not be 

considered. 

(c) Selection of arbitrator. The 

Arbitration Administrator will maintain 

a list of qualified arbitrators who have 

agreed to serve. The arbitration will be 

decided by one arbitrator if the amount 

in dispute is $500,000 or less and a 

panel of three arbitrators if the amount 

in dispute exceeds $500,000. Arbitrators 

will be assigned by the Arbitration 

Administrator through a random 

drawing. 

(d) Conduct of arbitration. Pursuant to 

guidelines from the Arbitration 

Administrator, which will be provided 

directly to claimants who have filed a 

request for arbitration, the arbitration 

process will include an arbitration 

hearing with consideration of the 

claimant’s written request for 

arbitration, the Administrative Record, 

and oral testimony. Hearings will 

generally be conducted virtually. In 

limited circumstances, the arbitrator 

may convene an in-person hearing at a 

location in New Mexico designated by 

the Arbitration Administrator. 

(e) Decision. After a hearing and 

reviewing the evidence, the arbitrator(s) 


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will render a written decision and will 

transmit the decision to the Arbitration 

Administrator, the claimant, and the 

Director of the Claims Office. If a panel 

of three arbitrators conducts the 

arbitration, at least two of the three 

arbitrators must sign the decision. The 

arbitrator(s) should render a decision no 

later than 10 Days after a hearing is 

concluded. The Arbitration 

Administrator may extend the time for 

a decision with notice to the claimant 

and the Director of the Claims Office. 

The decision will establish the 

compensation due to the claimant, if 

any, and the reasons therefor. 

(f) Action on arbitration decision. The 

Arbitration Administrator will forward 

the arbitration decision to the claimant 

and, if additional compensation is 

awarded to the claimant, a Release and 

Certification Form. Additional 

compensation awarded in the 

arbitration will be paid to the claimant 

after the signed Release and 

Certification Form is received by the 

Arbitration Administrator. 

(g) Final decision. The decision of the 

arbitrator(s) will be final and binding on 

all parties and will not be subject to any 

administrative or judicial review. The 

arbitrator(s) may correct clerical, 

typographical or computational errors as 

requested by the Arbitration 

Administrator. 

(h) Administration of arbitration. The 

Arbitration Administrator oversees 

arbitration procedures and will resolve 

any procedural disputes arising in the 

course of the arbitration. 

(i) Expenses. The Arbitration 

Administrator will pay all fees and 

expenses of the arbitrator(s). The 

claimant is responsible for any expenses 

they incur, including travel costs. 

§ 296.43 Judicial review. 

As an alternative to arbitration, a 

claimant dissatisfied with the outcome 

of an Administrative Appeal may seek 

judicial review of the decision by 

bringing a civil lawsuit against FEMA in 

the United States District Court for the 

District of New Mexico. This lawsuit 

must be brought within 60 Days of the 

date that appears on the Administrative 

Appeal decision. Pursuant to section 

104(i) of the Act, the court may only 

consider evidence in the Administrative 

Record. The court will uphold FEMA’s 

decision if it is supported by substantial 

evidence on the record considered as a 

whole. 

Deanne Criswell, 

Administrator, Federal Emergency 

Management Agency. 

[FR Doc. 2023–18457 Filed 8–28–23; 8:45 am] 

BILLING CODE 9111–68–P 


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