Don’t victimize communities hit by disasters a second time

As the country’s ongoing struggle with COVID-19 vividly illustrates, there is no substitute for federal financial assistance in the wake of a devastating disaster. Extreme crises call for assistance on a scale so large that immediate- and long-term aid must combine in order to salve the instant wound – and build a solid foundation for eventual recovery.

For communities decimated by catastrophes, from wildfires to hurricanes and now pandemics, the positive impact of these funds is stark. Often, they are the difference between survival or a short path to the decay of irreversible businesses loss and population flight.

Still, there is a gap in this multi-part solution that leaves already hammered communities subject to costly and ongoing expenses in the form of millions of dollars in interest payments for the commercial loans that mandate monthly re-payment installments. While the principal – but not the interest – is eventually reimbursed by the Federal Emergency Management Agency (FEMA), that process takes years and deprives localities of critical funds that would produce tangible results if they could be spent on housing, infrastructure and emergency restoration priorities.

In Panama City, Fla. – the central target of 2018’s Hurricane Michael, the first Category 5 storm to make landfall in the U.S. since 1992 and the strongest storm to ever hit the Florida Panhandle – interest payments amount to $6,000 a day. Every day.

Instead, this $2.19 million non-productive annual expenditure could be redirected and play a big part helping to fund repairs to wastewater and potable water infrastructure, police and fire vehicles, as well as repairs to roads and sidewalks.

Like so many communities across the country that have managed through the chaos of a natural disaster, Panama City had to initially draw on its own resources, and that which it could borrow, to restore basic services as it tiptoed forward. By way of example, 2017’s Hurricane Irma created 2.3 million cubic yards of debris scattered across 50 counties, in comparison to the 4 million cubic yards of debris that Michael left in Panama City’s 35 square miles alone. Practically speaking, nothing can be fixed – much less renovated – until the streets are clear of debris. Even first responders and power company repair trucks were paralyzed and couldn’t navigate through the thicket of trees, torn roofs, furniture and other wreckage until the streets were passable.

For a city with a pre-storm population of 37,000 residents and a total annual budget of $100 million, the expense of having to borrow another $75 million – and potentially more – is unsustainable. In the 18 months since the storm, FEMA has reimbursed the city for only 10 percent of the money it has spent.

Current estimates suggest that interest payments could cost Panama City and Bay County as much as $20 million over the life of its loans. And therein lies the challenge: in exchange for immediate assistance, communities have to commit to long-term interest payments at precisely the time when those funds are so critically needed on the front lines of recovery.

Fortunately, Florida Sens. Marco Rubio and Rick Scott have introduced the Fairness in Disaster Relief Act which would authorize the reimbursement of local governments for qualified interest payments on FEMA loans for recovery and mitigation efforts as the result of emergency natural disasters. The legislation is a companion to the U.S. House bill that Florida Rep. Neal Dunn introduced in November 2019.

The opposite of parochial, this bill will deliver much needed relief to a wide swath of communities across the country who are still recovering from wildfires in California to floods in the Midwest to tornadoes across the South. And it will give those who face the adversity of natural disasters in the future the hope and wherewithal to rebuild.

Merely an asterisk in the overall federal budget, this modest tweak will drive a manifold return on investment and enable communities to recognize their post-disaster renaissance with dispatch. In turn, businesses and citizens alike will not abandon these federally-declared disaster areas, but rather embrace the opportunity to stay put and help realize the promise of a robust reconstruction.

Greg Brudnicki is the mayor of the City of Panama City, Fla.