Baton Rouge Reporter

The U.S. House of Representatives has unanimously approved the FEMA Loan Interest Payment Relief Act, known as H.R. 2672. The bill was co-authored by Congressman Garret Graves of South Louisiana along with Congressmen Neal Dunn and Darren Soto, both from Florida. This legislation mandates that FEMA pay interest on reimbursements to local governments and electrical cooperatives.

Graves had previously pushed for this provision by attaching it as an amendment to other legislative measures in Congress. He stated, "FEMA has no incentive to be efficient. The Inspector General recently found that the disaster agency had $71 billion in outstanding reimbursement claims from state and local governments — some dating back over a decade." He further emphasized the financial burden on local communities caused by delayed payments, noting that they often have to cut services to manage disaster response costs.

The bill was passed by the House Transportation and Infrastructure Committee on September 19, 2024, alongside other pro-disaster victim bills authored by Graves. The Senate is anticipated to approve H.R. 2672 swiftly before it proceeds to the president for signing into law.

Under this new legislation, local governments and electric cooperatives will have the option to take loans from local banks to cover disaster-related expenses while waiting for FEMA claims processing. This approach aims to charge FEMA for any delays rather than impacting affected communities financially, encouraging quicker reimbursements.

These loans are crucial for restoring normalcy in parishes, cities, and co-ops post-disaster. They enable rebuilding efforts for public infrastructure such as buildings and schools while also aiding electric cooperatives in restoring power services. These public entities rely heavily on support from local taxpayers and ratepayers who are often victims of these disasters themselves.