[Federal Register Volume 84, Number 55 (Thursday, March 21, 2019)]
[Rules and Regulations]
[Pages 10632-10664]
[FR Doc No: 2019-05388]

Vol. 84

Thursday,

No. 55

March 21, 2019

Part III

Department of Homeland Security

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Federal Emergency Management Agency

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44 CFR Part 206

Factors Considered When Evaluating a Governor's Request for Individual
Assistance for a Major Disaster; Final Rule

Federal Register / Vol. 84 , No. 55 / Thursday, March 21, 2019 /
Rules and Regulations

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DEPARTMENT OF HOMELAND SECURITY

Federal Emergency Management Agency

44 CFR Part 206

[Docket ID FEMA-2014-0005]
RIN 1660-AA83

Factors Considered When Evaluating a Governor's Request for
Individual Assistance for a Major Disaster

AGENCY: Federal Emergency Management Agency, DHS.

ACTION: Final rule.

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SUMMARY: FEMA is issuing a final rule to revise its regulations to
comply with Section 1109 of the Sandy Recovery Improvement Act of 2013.
The Act requires FEMA, in cooperation with State, local, and Tribal
emergency management agencies, to review, update, and revise through
rulemaking the Individual Assistance factors FEMA uses to measure the
severity, magnitude, and impact of a disaster.

DATES: This final rule is effective on June 1, 2019.

FOR FURTHER INFORMATION CONTACT: Mark Millican, FEMA, Individual
Assistance Division, 500 C Street SW, Washington, DC 20472-3100,
(phone)<PHONE_NUMBER> or (email<EMAIL_ADDRESS>
SUPPLEMENTARY INFORMATION:

Table of Contents

I. Executive Summary
    A. Purpose of the Regulatory Action
    1. The Need for the Regulatory Action and How the Action Will
Meet the Need
    2. Legal Authority
    B. Summary of Major Provisions
II. Background and Proposed Rule
III. Discussion of Public Comments on the Proposed Rule
    A. 44 CFR 206.48, Paragraph (b)(1)--State Fiscal Capacity and
Resource Availability
    B. 44 CFR 206.48, Paragraph (b)(2)--Uninsured Home and Personal
Property Losses
    C. 44 CFR 206.48, Paragraph (b)(3)--Disaster Impacted Population
Profile
    D. 44 CFR 206.48, Paragraph (b)(4)--Impact to Community
Infrastructure
    E. 44 CFR 206.48, Paragraph (b)(5)--Casualties
    F. 44 CFR 206.48, Paragraph (b)(6)--Disaster Related
Unemployment
    G. Principal Factors for Evaluating the Need for the Individuals
and Households Program
    H. Lack of Thresholds
    I. IA Declarations Factors Guidance
    J. Preliminary Damage Assessments
    K. Amount of Data Requested
IV. Final Rule
V. Regulatory Analysis
    A. Executive Order 12866, Regulatory Planning and Review and
Executive Order 13563, Improving Regulation and Regulatory Review
    1. Executive Summary & A-4 Accounting Statement
    2. Need for Regulatory Action
    3. Affected Population
    4. Current Baseline and Impacts of Final Rule
    5. Impacts to Costs, Benefits, and Transfer Payments
    a. State Costs
    b. Federal Costs
    c. Benefits
    d. Transfer Payments
    6. Total Impact of the Final Rule
    7. Marginal Analysis of the Factors
    8. Regulatory Alternatives
    a. Voluntary, Faith, and Community Based Organizations Resources
    b. Maintain the 44 CFR 206.48(b) Table
    c. Automatically Trigger Contiguous Counties and States
    d. Considering Negative Impact on Businesses
    e. Linking Individual Assistance Cost Factor With Public
Assistance (PA) Cost Factor
    f. Use of Factor Thresholds
    g. Homes in Foreclosure
    h. Do Not Include Fiscal Capacity Indicators
    B. Regulatory Flexibility Act
    C. Unfunded Mandates Reform Act of 1995
    D. National Environmental Policy Act
    E. Paperwork Reduction Act of 1995
    F. Privacy Act
    G. Executive Order 13175, Consultation and Coordination With
Indian Tribal Governments
    H. Executive Order 13132, Federalism
    I. Executive Order 11988, Floodplain Management
    J. Executive Order 11990, Protection of Wetlands
    K. Executive Order 12898, Environmental Justice
    L. Congressional Review of Agency Rulemaking

I. Executive Summary

A. Purpose of the Regulatory Action

1. The Need for the Regulatory Action and How the Action Will Meet the
Need
    On January 29, 2013, the Sandy Recovery Improvement Act of 2013
(SRIA) was enacted into law (Pub. L. 113-2). Section 1109 of SRIA
requires FEMA, in cooperation with State, local, and Tribal emergency
management agencies, to review, update, and revise through rulemaking
the factors found at 44 CFR 206.48 that FEMA uses to determine whether
to recommend provision of Individual Assistance (IA) during a major
disaster. These factors help FEMA measure the severity, magnitude, and
impact of a disaster, as well as the capabilities of the affected
jurisdictions.
    FEMA is issuing this final rule to comply with SRIA and to provide
clarity on the IA declaration factors that FEMA currently considers in
support of its recommendation to the President on whether a major
disaster declaration authorizing IA is warranted. The additional
clarity may reduce delays in the declaration process by decreasing the
back and forth between States and FEMA during the declaration process.
FEMA is also finalizing a factor on Fiscal Capacity to provide
additional relevant information and context regarding potential
disaster situations.
2. Legal Authority
    FEMA has authority for this final rule pursuant to the Robert T.
Stafford Disaster Relief and Emergency Assistance Act (Stafford Act).
42 U.S.C. 5121 et seq. Section 401 of the Stafford Act lays out the
procedures for a declaration for FEMA's major disaster assistance
programs when a catastrophe occurs in a State. The specific changes in
this final rule comply with Section 1109 of the Sandy Recovery
Improvement Act of 2013, Public Law 113-2.

B. Summary of Major Provisions

    FEMA is revising the factors found at 44 CFR 206.48 that FEMA uses
to determine whether to recommend provision of Individual Assistance
during a major disaster. The current factors found at 44 CFR 206.48 for
Individual Assistance include the following factors: (1) Concentration
of Damages, (2) Trauma, (3) Special Populations, (4) Voluntary Agency
Assistance, (5) Insurance, and (6) Average Amount of Individual
Assistance by State.
    FEMA is revising the current factors to provide additional clarity
regarding the considerations that FEMA has evaluated in recent years
when making a recommendation on whether Individual Assistance is
warranted for a major disaster declaration. This final rule also adds
new factors that will help FEMA more accurately and consistently
determine whether the impact of an event is beyond State and local
government capabilities. FEMA is revising 44 CFR 206.48(b) to identify
the following factors: (1) State Fiscal Capacity and Resource
Availability, (2) Uninsured Home and Personal Property Losses, (3)
Disaster Impacted Population Profile, (4) Impact to Community
Infrastructure, (5) Casualties, and (6) Disaster Related Unemployment.
As is currently the practice, FEMA will continue to use a myriad of
factors and data to formulate its recommendations to the President on
major disaster

declarations that authorize IA. No single data point or factor will be
determinative of FEMA's recommendation nor will any single factor
necessarily affect the President's ultimate determination of whether a
major disaster declaration authorizing IA is warranted. FEMA purposely
declined to be more restrictive in areas of the final rule because
disaster events can vary greatly from incident to incident, and FEMA
must retain the flexibility and discretion to properly advise the
President regarding situations or circumstances that FEMA may not be
able to fully predict or define in a rulemaking. Moreover, as a result
of climatological and demographic changes, disaster trends are likely
to continue to change in ways that may require policy shifts at the
agency or Administration level. FEMA wants to ensure that we retain as
much flexibility as possible. The final factors do not limit the
President's discretion regarding major disaster declarations.

II. Background and Proposed Rule

    When a catastrophe occurs in a State, the State's Governor may
request a Presidential declaration of a major disaster \1\ pursuant to
Section 401 of the Robert T. Stafford Disaster Relief and Emergency
Assistance Act (Stafford Act). 42 U.S.C. 5170; 44 CFR 206.36(a). Such a
request must be based on a finding that the disaster is of such
severity and magnitude that an effective response is beyond the
capabilities of the State and the affected local governments and that
Federal assistance is necessary. 42 U.S.C. 5170.
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    \1\ A major disaster is any natural catastrophe (including any
hurricane, tornado, storm, high water, wind driven water, tidal
wave, tsunami, earthquake, volcanic eruption, landslide, mudslide,
snowstorm, or drought), or, regardless of cause, any fire, flood, or
explosion, in any part of the United States, which in the
determination of the President causes damage of sufficient severity
and magnitude to warrant major disaster assistance under this Act to
supplement the efforts and available resources of States, local
governments, and disaster relief organizations in alleviating the
damage, loss, hardship, or suffering caused thereby. 42 U.S.C. 5122;
44 CFR 206.2(17).
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    The capability to respond to a catastrophe varies from State to
State. The initial decision on whether to seek supplemental Federal
assistance to help a State respond to and recover from a natural
disaster lies with each State. The basis for any State request for a
major disaster declaration must be a finding that (1) the situation is
of such severity and magnitude that an effective response is beyond the
capabilities of the State and affected local governments, and (2)
Federal assistance under the Stafford Act is necessary to supplement
the efforts and available resources of the State, local governments,
disaster relief organizations, and compensation by insurance for
disaster-related losses. 44 CFR 206.36(b)(1)-(2).
    A major disaster declaration will identify the types of assistance
that are authorized under the declaration, 44 CFR 206.40(a), although
other types may be authorized later, 44 CFR 206.40(c). The types of
assistance authorized under the declaration are based upon whether the
damage involved and its effects are of such severity and magnitude as
to be beyond the response capabilities of the State, the affected local
governments, and other potential recipients of supplemental Federal
assistance. 44 CFR 206.40(a). A major disaster declaration may
authorize all, or only particular types of, supplemental Federal
assistance requested by the Governor. 44 CFR 206.40(a). As noted above,
when evaluating requests for Individual Assistance, FEMA considers the
factors under 44 CFR 206.48(b) to determine whether supplemental
Federal Individual Assistance is warranted.
    A major disaster declaration authorizing Individual Assistance may
include any or all of the following programs:
    Individuals and Households Program: The Individuals and Households
Program (IHP) provides grants, direct assistance, or both to eligible
disaster survivors who have necessary expenses and serious needs that
they are unable to meet through other means, such as insurance. 44 CFR
206.110-120. This help may be in the form of housing assistance
(including Temporary Housing, Repair, Replacement, and Semi-Permanent
or Permanent Housing Construction) as well as assistance to meet
``other needs'' such as medical, dental, child care, funeral, personal
property, and transportation costs.
    Crisis Counseling Program: The Crisis Counseling Program (CCP)
assists individuals and communities recovering from the effects of a
natural or human caused disaster through the provision of community
based outreach and psycho-educational services. 44 CFR 206.171.
Supplemental Federal funding for crisis counseling is available to the
State through two grant mechanism: (1) Immediate Services Program,
which provides funds for up to 60 days of services immediately
following a disaster declaration; and (2) the Regular Services Program,
which provides funds for up to nine months following a disaster
declaration.
    Disaster Case Management Program: The Disaster Case Management
Program (DCMP) is a program that involves a partnership between a
disaster case manager and a survivor to develop and carry out a
Disaster Recovery Plan. 42 U.S.C. 5189d. The process involves an
assessment of the survivor's verified disaster caused unmet needs,
development of a goal oriented plan that outlines the steps necessary
to achieve recovery, organization and coordination of information on
available resources that match the disaster caused unmet needs,
monitoring of progress towards the recovery plan goals and, when
necessary, client advocacy.
    Disaster Legal Services: Disaster Legal Services provides legal
assistance to low income individuals who, prior to or as a result of
the disaster, are unable to secure legal services adequate to meet
their disaster related needs. 44 CFR 206.164. FEMA, through an
agreement with the Young Lawyers Division of the American Bar
Association, provides free legal help for disaster survivors.
    Disaster Unemployment Assistance: Disaster Unemployment Assistance
(DUA) provides unemployment benefits and re-employment services to
individuals who have become unemployed as a result of a major disaster
and who are not eligible for regular State unemployment insurance. 44
CFR 206.141.
    On January 29, 2013, SRIA was enacted into law. Public Law 113-2.
Section 1109 of SRIA requires FEMA, in cooperation with State, local,
and Tribal emergency management agencies, to review, update, and revise
through rulemaking the factors found at 44 CFR 206.48 that FEMA uses to
determine whether to recommend provision of Individual Assistance
during a major disaster. These factors help FEMA measure the severity,
magnitude, and impact of a disaster.
    Congress directed FEMA to review, update, and revise these factors,
including 44 CFR 206.48(b)(2) related to trauma and the specific
conditions or losses that contribute to trauma, to provide more
objective criteria for evaluating the need for assistance to
individuals, to clarify the threshold for eligibility, and to speed a
declaration of a major disaster or emergency \2\ under

the Stafford Act. SRIA required the completion of this rulemaking by
January 29, 2014.
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    \2\ The factors that FEMA considers to evaluate the need for
assistance to individuals under the Stafford Act are at 44 CFR
206.48. FEMA uses these factors to evaluate a governor's request for
a declaration of a major disaster, not an emergency. SRIA Section
1109 states that FEMA must review, update, and revise the factors in
44 CFR 206.48(b). The factors that FEMA uses to evaluate a
governor's request for emergency assistance, however, are not
provided in 44 CFR 206.48(b) or in FEMA's regulations. Therefore,
the scope of this rulemaking will apply only to Individual
Assistance factors that FEMA considers when evaluating a Governor's
request for a major disaster declaration. Section 502 of the
Stafford Act authorizes FEMA to provide IHP assistance as part of an
emergency declaration. FEMA has previously considered some of the
factors found at 206.48(b) when considering an emergency declaration
request that includes IHP assistance. FEMA will continue to consider
some of the factors, when applicable, at 44 CFR 206.48(b) when
evaluating an emergency declaration request that includes IHP
assistance.
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    On November 12, 2015, FEMA published a notice of proposed
rulemaking pursuant to Section 1109 of SRIA. 80 FR 70116. FEMA proposed
to revise 44 CFR 206.48(b) to include the following factors: (1) State
Fiscal Capacity and Resource Availability, (2) Uninsured Home and
Personal Property Losses, (3) Disaster Impacted Population Profile, (4)
Impact to Community Infrastructure, (5) Casualties, and (6) Disaster
Related Unemployment. A complete description of each factor can be
found in the proposed rule. See 80 FR 70116. This final rule
incorporates the reasoning of the proposed rule except as reflected
elsewhere in this preamble. The final rule adopts proposed rule with
two changes: removal of the sub-factors related to State Services and
Planning After Prior Disasters. These changes are discussed below in
III. Discussion of Public Comments on the Proposed Rule.

FEMA's Outreach Efforts Following Publication of the Notice of Proposed
Rulemaking

    Section 1109 of SRIA requires FEMA to cooperate with State, local,
and Tribal emergency management agencies during the process of
reviewing, updating, and revising the factors found at 44 CFR
206.48(b). FEMA conducted outreach prior to publication of the NPRM.
See 80 FR 70119. In addition, following publication of the NPRM, on
December 8 and 9, 2015, FEMA held two webinars for State governors'
offices, State emergency managers, and national level State
associations to explain the provisions of the proposed rule. At the end
of both webinars, FEMA accepted comments from the listeners. FEMA
considered these comments in the formulation of this final rule and
summarizes and responds to these comments below. The webinar
presentation itself can be found in the rulemaking docket at
www.regulations.gov.

III. Discussion of Public Comments on the Proposed Rule

    FEMA received written comments from 35 commenters in response to
the proposed rule. The majority of commenters were from State emergency
management agencies, but commenters also included members of Congress,
an emergency management association, charitable organizations, and
private citizens. The commenters raised a variety of issues that are
discussed below.

A. 44 CFR 206.48, Paragraph (b)(1)--State Fiscal Capacity and Resource
Availability

Fiscal Capacity
    The proposed Fiscal Capacity factor defined fiscal capacity as a
State's potential ability to raise revenue from its own sources to
respond to and recover from a disaster. The proposed rule identified
the following data points as sub-factors:
     Total Taxable Resources (TTR) of the State. TTR is the
U.S. Department of Treasury's annual estimate of the relative fiscal
capacity of a State. A low TTR may indicate a greater need for
supplemental Federal assistance than a high TTR.
     Gross Domestic Product (GDP) by State. GDP by State is
calculated by the Bureau of Economic Analysis. GDP by State may be used
as an alternative or supplemental evaluation method to TTR.
     Per capita personal income by local area. Per capita
personal income by local area is calculated by the Bureau of Economic
Analysis. A low per capita personal income by local area may indicate a
greater need for supplemental Federal assistance than a high per capita
personal income by local area.
    FEMA received comments from 22 commenters regarding this proposed
factor; a summary of these comments, and FEMA's responses, follows.
    Several commenters expressed concern that the use of fiscal
capacity data would effectively penalize States with relatively greater
fiscal capacity. Some comments expressed concern that because a high
TTR is frequently correlated with a large state population (and
correspondingly high operational expenses), the use of TTR could
adversely impact States with larger populations. Along similar lines,
one commenter suggested that the use of TTR with respect to California
``would make it significantly more difficult for Californians to access
individual disaster assistance'' than residents of other states,
because California's TTR is significantly higher than the TTR of other
states. The commenter suggested that as a result of this significant
disparity between States in TTR, as well as the diverse geography,
disaster vulnerability, and demographics of California, TTR ``is too
broad of a factor to provide a useful assessment of [the] statutory
requirement for a state's capacity--let alone a local government's
capacity--to manage a disaster.'' \3\ The commenter encouraged FEMA to
``find a factor other than [TTR] that is better representative of both
state and local resources available to each specific disaster.''
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    \3\ Another commenter raised similar concerns with respect to
the application of TTR to disaster declaration requests from Texas.
The commenter wrote that ``In a state as large and diverse as Texas,
[TTR and GDP by State] don't truly represent the state's or an
affected individual's ability to recover from a disaster without
federal assistance.'' FEMA agrees that TTR and GDP by State do not
represent affected individuals' ability to recover from a disaster
without Federal assistance. Instead, FEMA uses other information to
determine individuals' needs. What TTR and GDP by State represent is
the affected State's capacity to assist those individuals with
recovering from a disaster. TTR and GDP by State also provide a
starting point for evaluating when the affected State is indeed
overwhelmed and in need of supplemental Federal assistance to aid in
providing assistance to individuals.
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    FEMA notes that assistance provided by FEMA is intended to be
supplemental in nature and FEMA must evaluate the fiscal capacity of
the State to determine whether the State is overwhelmed or if the State
has sufficient resources available to provide the needed disaster
assistance without Federal assistance. FEMA's current approach, which
largely relies on comparing level of damage to the population size of
the affected State, essentially equates population with capacity. FEMA
believes that a more direct way to evaluate a State's fiscal capacity
is to use objective data such as U.S. Department of Treasury's TTR data
or the Bureau of Economic Analysis' (BEA) GDP by State data. These are
statistical measures of a State's economic activity, which can provide
insight into changes in the general economic well-being of the State
and its relative fiscal capacity. Although these measures are
frequently strongly correlated with population size, they are more
direct measures of fiscal capacity, and are therefore more appropriate
for this purpose.
    FEMA notes that any factor could be framed as a ``penalty.'' The
appropriate question is not whether any given factor operates as a
penalty, but how such a factor relates to statutory requirements. Just
as a State with ample fiscal capacity and resource availability could
characterize as a ``penalty'' FEMA's determination that the State is
able to use such capacity and resources to respond effectively to a
disaster, a State that is struck by a relatively minor event could
characterize as a ``penalty''

FEMA's consideration of the lack of damage. In either case, the denial
would simply flow from the President's determination, consistent with
statutory requirements, that the State and affected local governments
should be able to respond to the disaster effectively without
supplemental Federal assistance. In other words, all of the factors in
this final rule are intended to allow FEMA and the President to make
informed decisions regarding whether or not an event was of the
severity and magnitude to be beyond State and local capability.
    Commenters expressed concern that TTR data may not accurately
capture the true fiscal capacity of a State because it calculates all
of the things that a State could potentially tax, not what is actually
taxed, and therefore may artificially inflate the perceived level of
fiscal capability. Several commenters stated that FEMA should not
consider a State's ability to pay based on potential revenues alone,
without considering a State's expenses as well because it is a one-
sided assessment of a State's capacity to respond and does not
necessarily fully consider a State's ability to provide adequate
disaster assistance. Another commenter observed that a State that has a
high TTR because of a high population is likely to have correspondingly
high expenses as well.
    As discussed above, TTR is a value-neutral measure of a State's
economic activity, which can provide insight into a State's relative
fiscal capacity and changes in its economic wellbeing, regardless of
the taxing choices and other constraints that may be imposed on it by
State law, State constitution, or policy choices. TTR is also
indicative of the overall economic and fiscal health of the people and
the businesses within the State, which is relevant to the disaster
impacted population's ability to recover (recognizing that there are
poor communities in rich States and vice versa, FEMA will also consider
per capita personal income at the local level).\4\ FEMA believes that
States with a large TTR have a greater capability to respond to and
recover from disaster events compared to States with a lower TTR. FEMA
does not expect or require a State to exhaust its resources before
supplemental Federal assistance would be appropriate. FEMA welcomes
States to provide additional clarity on their fiscal capacity, and the
fiscal capacity of local governments, by highlighting fiscal
restrictions and expenditures that, though not captured in TTR, are
relevant to the State and local government's capability to respond
effectively to the disaster. In addition, FEMA fully recognizes that
some disasters are so large and have such a serious impact that
supplemental Federal assistance will be necessary no matter the State's
available resources.
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    \4\ FEMA anticipates using per capita personal income when the
disaster effects are concentrated to a specific area. An example
would be a tornado that hits a town in a rural area. FEMA would
evaluate the State's overall TTR to gain insight into the State's
ability to respond. FEMA also would evaluate the locality's per
capita income to gain insight into that specific population's
ability to respond, i.e. is the per capita personal income for that
area sufficient to support an independent response? How will that
affect the survivors' resiliency?
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    Several commenters expressed concern that the fiscal capacity
indicators capture the fiscal capacity of a State before the event
without considering that a State's economy may have been impacted by
the disaster event. As part of FEMA's evaluation of a State's request,
FEMA will evaluate the impact of the disaster on the State. If a State
believes that the disaster has negatively and significantly impacted
its fiscal capacity to respond or the overall State economy, the State
may discuss such impacts in its declaration request.
    Commenters expressed concern that the two-year lag in TTR data may
result in the use of inaccurate data. Pursuant to Public Law 102-321,
the U.S. Department of the Treasury produces annual estimates of total
taxable resources (TTR) for all States. The TTR estimates are published
by September 30th each year and have a two-year lag. For example, TTR
for 2016 was published on September 28, 2018. The formula for
calculating TTR uses Gross State Product (GSP) \5\ as its base,
subtracts non-taxable components, then accounts for cross-border income
flows. This calculation provides a ``comprehensive measure of all the
income flows a state can potentially tax.'' \6\ The two-year lag in TTR
data is a direct result of when income data becomes available. Raw
income data is always one year behind. Tax filings for any given year
are generally due by April 15 of the following year.\7\ This accounts
for the first lag year. The second lag year is attributable to putting
the vast amount of data into a usable format.\8\
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    \5\ The term Gross State Product (GSP) is used interchangeably
herein with the term Gross Domestic Product for States (GDP by
State). The U.S. Department of the Treasury uses the former, while
the U.S. Department of Commerce, Bureau of Economic Analysis uses
the latter. Published documents relating to TTR use GSP; thus, it is
also used here.
    \6\ ``Treasury Methodology for Estimating Total Taxable
Resources (TTR),'' revised November 2002, page 2. https://www.treasury.gov/resource-center/economic-policy/Documents/nmpubsum.pdf.
    \7\ IRS Publication 509--Main Content, General Tax Calendar,
Topic: Individuals, Form 1040, https://www.irs.gov/publications/p509/ar02.html.
    \8\ ``TTR estimates for a given year will only be made when both
GSP and SPI data are available for that year.'' ``Treasury
Methodology for Estimating Total Taxable Resources (TTR),'' revised
November 2002, page 5. https://www.treasury.gov/resource-center/economic-policy/Documents/nmpubsum.pdf.
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    FEMA reviewed a ten-year data set of TTR for each State in response
to comments on the two-year lag.\9\ Based on that review, FEMA found
that TTR is sufficiently reliable to serve as the principal indicator
for each State from which the discussion about fiscal capacity can
begin. For the 10 years FEMA reviewed, TTR generally increased from
year to year in every State. The exceptions, when TTR dropped, were
generally due to circumstances that would have been readily apparent at
the time. For example, nearly every State saw year-to-year drops from
2007-2008 and/or 2008-2009, coinciding with the financial crisis. While
2008 TTR data would not have been available to analyze for requests
made during that time, FEMA and the States would have been well aware
that capability and fiscal capacity among all of the States was
decreasing, and FEMA would have been able to take that decreased
capacity into consideration. In addition, events such as significant
falls in certain commodity prices, which may impact one or two States
as opposed to the entire nation, will also generally be apparent and
supported by other readily available data at the time of the request.
FEMA recognizes that there is a two-year lag and encourages each State
to provide additional information about its fiscal capacity, especially
if there have been noteworthy economic impacts during the two-year lag
which impact the State's ability to respond to and recover from the
disaster.
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    \9\ The data set was comprised of the data contained in the TTR
reports published between 09/26/2006 and 09/30/2015 (10 years of
data). Although the reports are published and have titles ranging
from 2006 through 2015, the data lags two years. For example, the
report entitled ``2006 Total Taxable Resources Estimates'' was
published on 09/26/2006 and contains TTR estimates for 2004.
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    A commenter raised concerns that TTR is considered experimental and
thus should not be used to evaluate a State's fiscal capacity. The U.S.
Department of the Treasury's website includes three papers explaining
the methodology it uses to estimate TTR.\10\

Each of these papers refers to an ``experimental'' methodology
developed in 1986.\11\ This ``experimental'' methodology was refined
and finalized for use beginning in 1992.\12\ In 1997, the methodology
was substantially improved and in 1998 that improved methodology was
implemented. The methodology has remained unchanged since 1998. Based
on approximately 20 years of use, FEMA does not consider TTR
``experimental'' and believes TTR provides valuable insight into the
fiscal capacity of States. Congress has recognized the utility of TTR
by requiring its use in the formula used to allocate Federal funds for
the Department of Health and Human Services' Community Mental Health
Service and Substance Abuse Prevention and Treatment block grant.\13\
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    \10\ The three papers explaining the methodology for calculating
TTR are ``Summary of Current Methodology for Estimating TTR,''
``Working Paper Review of Methodology for Estimating TTR,'' and
``Summary of Previous Methodology for Estimating TTR.'' U.S. Dep't
of the Treasury, Resource Center, Total Taxable Resources, https://home.treasury.gov/policy-issues/economic-policy/total-taxable-resources.
    \11\ Carnevale, John, ``Experimental Estimates of Total Taxable
Resources, 1981-84,'' in the Federal State-Local Fiscal Relations:
Technical Papers, Vol., 2, Office of State and Local Finance,
Department of Treasury, September 1986.
    \12\ ``Summary of Current Methodology for Estimating TTR,'' U.S.
Dep't of the Treasury, Resource Center, Total Taxable Resources,
page 1, paragraph 2, https://www.treasury.gov/resource-center/economic-policy/Documents/nmpubsum.pdf.
    \13\ 42 U.S.C. 300x-7.
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    A commenter asked that FEMA clarify the process it will use to
determine when a State can rely on GDP data instead of TTR. The
commenter also asked FEMA to explain more thoroughly how per capita
personal income by local area would be analyzed with TTR and GDP to
determine a State's Fiscal Capacity. TTR is available for every State
and FEMA will consider the relevant TTR for every State. If a State
wants to use either GDP by State or Per Capita Personal Income data to
supplement or highlight a differing fiscal health of the State then the
State can submit the information to FEMA. However, FEMA will still
consider TTR data for that request.
    Several commenters expressed concerns about FEMA focusing too much
on the fiscal capacity of States as compared to the fiscal capacity of
local governments. One commenter raised the concern that taxable
revenue and wealth in many States is not evenly distributed throughout
and impoverished areas would be hurt if the State's request for an IA
declaration was judged by the overall state's fiscal capacity. FEMA
notes that the State is the one who makes the determination to apply
for a major disaster declaration that the State needs supplemental
Federal assistance. FEMA must evaluate at the State level because a
request for a disaster declaration must be based on a finding that the
disaster is of such severity and magnitude that effective response is
beyond the capabilities of the State and the affected local governments
and that Federal assistance is necessary.\14\
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    \14\ 42 U.S.C. 5170.
---------------------------------------------------------------------------

    Several commenters asked whether the ``Fiscal Capacity'' data will
be shared with the States and expressed concern that they would be
burdened by having to pre-identify their own Fiscal Capacity data. FEMA
is planning on providing links on FEMA's website to the data sources
for States to easily access their own fiscal capacity data if they wish
to review it prior to a major disaster request being made. In addition,
the fiscal capacity data is easily found using a web search. The States
will simply list their current fiscal capacity data in their request.
As discussed above, States may also gather and provide additional
information to supplement or provide further context to the specified
data points.
    A commenter asked how local area is defined for the ``Per Capita
Personal Income by Local Area'' sub-factor of the ``Fiscal Capacity''
factor. The per capita personal income by local area data is produced
by the Bureau of Economic Analysis for ``counties, micropolitan
statistical areas, metropolitan statistical areas (MSAs), metropolitan
divisions (parts of MSAs), combined statistical areas, states, and the
metropolitan and nonmetropolitan portions of states. Counties consist
of counties and county equivalents, such as the parishes of Louisiana,
the boroughs, municipalities and Census areas of Alaska, the District
of Columbia, and the independent cities of Maryland, Missouri, Nevada,
and Virginia. The estimates ofr Kalawoa County, Hawaii and the small
independent cities of Virginia-generally those with fewer than 100,000
residents-are combined with estimates for adjacent counties.'' \15\
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    \15\ Local Area Personal Income and Employment Methodology,
November 2017, ``Geographic Detail,'' page I-7. https://www.bea.gov/sites/default/files/methodologies/lapi2016.pdf.
---------------------------------------------------------------------------

Resource Availability.
    The proposed Resource Availability factor called for FEMA to
consider the availability of resources from State, Tribal, and local
governments as well as non-governmental organizations and the private
sector. The proposed rule identified the following sub-factors:
     State, Tribal, and local government; Non-Governmental
Organizations (NGO); and private sector activity. State, Tribal, and
local government, Non-Governmental Organizations, and private sector
resources may offset the need for or reveal an increased need for
supplemental Federal assistance. The State may provide information
regarding the resources that have been and will be committed to meet
the needs of disaster survivors such as housing programs, resources
provided through financial and in-kind donations, and the availability
of affordable (as determined by the U.S. Department of Housing and
Urban Development's fair market rent standards) rental housing within a
reasonable commuting distance of the impacted area.
     Cumulative effect of recent disasters. The cumulative
effect of recent disasters may affect the availability of State,
Tribal, local government, NGO, and private sector disaster recovery
resources. The State should provide information regarding the disaster
history within the last 24-month period, particularly those occurring
within the current fiscal cycle, including both Presidential (public
and individual assistance) and gubernatorial disaster declarations.
     State services. The State may provide information
regarding the circumstances causing the State to lack the resources to
provide sufficient services to its citizens.
     Planning after prior disasters. States are encouraged to
develop and continuously improve their own disaster assistance
programs. States should identify new and existing individual assistance
programs as well as improvements to existing individuals assistance
programs made as a result of previous disasters. A State's failure to
address limitations and shortfalls identified by FEMA or the State
after previous events will also be considered.
    FEMA received comments from 25 commenters regarding this proposed
factor. The commenters stated that the proposed factor assumed the
availability of volunteer and private sector resources that may not
exist because voluntary and private sector resources vary from year to
year based on donor funding; that FEMA should clarify the manner in
which it will quantify potential resources of voluntary and faith-based
organizations and limit the degree to which such resources will off-set
Federal assistance; that FEMA should not limit the ``Cumulative Effect
of Recent Disasters'' sub-factor to Presidential and gubernatorial
disaster declarations, because such a limitation would result in States
being unable to provide information on other types of Federal
declarations that can show the level of recent hardship such as SBA,
USDA, and Public Health Emergency declarations; that FEMA should better

define the ``State Services'' factor; and that the Resource
Availability factor in general would force the States to develop a
State-funded and administered IA program or be penalized in a State's
request for a major disaster declaration.
    A number of commenters expressed concern that by considering the
availability of volunteer and private sector resources, FEMA would
assume the availability of resources that may not in fact exist,
because voluntary and private sector resources vary from year to year
based on donor funding and a State has no authority to direct NGOs or
private organizations to provide funding or supplies post-disaster. In
addition, commenters stated that it is difficult for States and
communities to quickly assemble and report information about these
resources in the immediate aftermath of a disaster, when impacted
communities are in response mode. Commenters also asked FEMA to clarify
how FEMA would request this data.
    The current regulations at 44 CFR 206.48(b)(4) state that FEMA will
consider the extent to which voluntary agencies and State or local
programs can meet the needs of the disaster victims and this
information is already provided as part of the narrative aspects of a
State's major disaster request for IA. The only new aspect of this
factor, as compared to the current regulations, is a reference to
private sector resources. While private sector resources were not
previously specifically listed in the regulation, items such as
significant private donations have always been relevant, and States
have generally provided information on such donations when that
information has been available at the time of the request. Assistance
provided by State, Tribal, and local government, NGOs, and the private
sector can include but is not limited to Emergency Management
Assistance Compact (EMAC) resources, sheltering, housing programs,
feeding, mental health services, child care, elder care, reunification
services, clean up kits, blankets and cots, financial assistance, and
other donations. To the extent that such resources are limited,
unavailable, or otherwise unable to meet significant needs after a
disaster, then the State should identify these limitations in its
request, as that may indicate additional need for Federal assistance.
FEMA understands that information will be imperfect after a disaster
and all relevant data may not be immediately available. As is currently
the practice, FEMA only asks that the State submit the best information
reasonably available to it at the time of the request.
    In addition, section 401 of the Stafford Act, conditions that a
request for a major disaster declaration must be based on a finding
that the disaster is of such severity and magnitude that an effective
response is beyond the capabilities of the State and the affected local
governments and that Federal assistance is necessary. 42 U.S.C. 5170;
44 CFR 206.36(a). In order for FEMA to evaluate whether a disaster is
beyond the capabilities of a State and affected local governments, FEMA
must evaluate what resources are available to the State and affected
local governments.
    This factor is also in keeping with the ``Whole Community''
approach to emergency management that reinforces the fact that FEMA is
only one part of our nation's emergency management team. Under the
``Whole Community'' approach, emergency managers must account for all
available resources, including non-governmental resources, in preparing
for, protecting against, responding to, recovering from and mitigating
against all hazards. This approach recognizes that a government-centric
approach to emergency management is not enough to meet the challenges
posed by a catastrophic incident. When the community is engaged in
emergency management, it becomes empowered to identify its needs and
the existing resources that may be used to address them. The ``Whole
Community'' approach is an ongoing component of the nation's larger,
coordinated effort to enhance emergency planning and strengthen the
nation's overall level of preparedness.
    Commenters were concerned about FEMA limiting the Resource
Availability factor related to past disaster declarations to only
Presidential (both Public Assistance and Individual Assistance) and
gubernatorial disaster declarations. The commenters stated that not all
assistance provided by a State or its partners requires a gubernatorial
declaration and there are other types of Federal declarations that can
show the level of recent hardship endured by the State, such as a Small
Business Administration Disaster declaration, United States Department
of Agriculture disaster designation, and Department of Health and Human
Services Public Health Emergency declaration. FEMA believes that taking
information on past disaster activity and declarations is valuable,
because multiple disasters in a 24-month period may significantly
strain a State budget and reduce the State's capability to adequately
respond to and recover from a disaster without supplemental Federal
assistance; this final rule therefore includes such a factor.
Consideration of recent disaster activity was previously only a
consideration for a major disaster declaration that authorized Public
Assistance. A State is always welcome to provide additional information
beyond what FEMA is asking for in 44 CFR 206.48(b). If a State feels
that recent disaster activity, as reflected in declarations through
SBA, USDA, or HHS, have impacted their ability to respond to and
recover from the event, then the State should include information on
those declarations in their major disaster request for IA.
    Several commenters expressed significant concerns with the ``State
Services'' and ``Planning After Prior Disasters'' factors. The
commenters felt that FEMA appeared to be forcing the States to develop
a State-funded and State-administered IA program or else risk being
penalized for the lack of such a program. The commenters stated that a
State IA program is not required by the Stafford Act in order to
receive supplemental Federal assistance. Several commenters asked
whether FEMA is currently evaluating States' limitations or shortfalls
and communicating these with States. Also, States requested that FEMA
clarify how it will determine that a State is or isn't addressing
limitations or shortfalls. Overall these commenters felt that the
proposed rule did not adequately explain how FEMA would apply these two
factors. Another commenter supported these factors, and urged FEMA ``to
also consider state effort to guard and mitigate against avoidable
disaster damages, for example, with programs to regulate new
development in flood hazard areas, adopt and enforce up to date state
building codes, or incorporate resilience considerations into the
location and construction of public infrastructure.'' A comment
expressed concern that the proposed rule ``may unfairly penalize States
that do not have robust IA programs.''
    Based on the overwhelmingly negative response and after further
review FEMA decided to remove the ``State Services'' and ``Planning
After Prior Disasters'' sub-factors from the final rule. FEMA strongly
believes States are ultimately responsible for the well-being of their
citizens and that States have a responsibility to plan for disasters,
pre-identify funding and resources, and to provide assistance to their
citizens after a disaster. This should include the establishment,
funding, and improvement of State-level individual assistance programs.
However, FEMA has not been able to develop a methodology which would
effectively and consistently evaluate the

State Services and Planning After Prior Disasters sub-factors to
incentivize States to establish individual assistance programs or to
plan and implement lessons learned from previous disasters. As a
result, at this time, FEMA is unable to effectively incentivize these
activities through the declarations process, and specifically in the
evaluation of disaster requests. FEMA will continue to explore
opportunities to encourage States to develop their own individual
assistance programs.

B. 44 CFR 206.48, Paragraph (b)(2)--Uninsured Home and Personal
Property Losses

    The proposed Uninsured Home and Personal Property Losses factor
included consideration of uninsured home and personal property losses,
and identified the following sub-factors:
     The cause of damage.
     The jurisdictions impacted and concentration of damage.
     The number of homes impacted and degree of damage.
     The estimated cost of assistance.
     The homeownership rate of impacted homes.
     The percentage of affected households with sufficient
insurance coverage appropriate to the peril.
     Other relevant preliminary damage assessment data.
    FEMA received comments from 16 commenters regarding this proposed
factor. The comments received were related mainly to concerns regarding
the sub-factors related to the jurisdictions impacted and concentration
of damages, the estimated cost of assistance, the homeownership rate of
impacted homes, and the percentage of affected households with
sufficient insurance coverage appropriate to the peril.
    Several commenters were concerned that FEMA is not taking into
consideration the effects of a disaster with widespread minimal damage
spread across a large geographic area or the effects of a disaster on
contiguous counties in different States. FEMA recognizes that as a
practical matter, widespread minimal damage spread across a larger
geographic area, can spread resources thin and overwhelm a State's
capability to adequately respond to a disaster. This final rule
continues to emphasize consideration of the estimated cost of
assistance for a State; as a result, the true cumulative impact of the
widespread minimal damage across a large geographic area within a State
will continue to be considered by FEMA. Regarding the contiguous
counties comments, the President will not declare a major disaster in
an area that was not requested by a Governor and a Governor cannot
request areas that are not within his or her State's jurisdiction. FEMA
will not designate areas of the State or types of assistance beyond
those that the governor requests.\16\ In addition, each State and local
government has different capabilities to respond to, recover from, and
mitigate the effects of a disaster and a disaster that crosses State
lines may have differing impacts in the affected States. As such, not
every event that impacts multiple States will necessarily be beyond
each affected State's respective capabilities. Therefore, FEMA must
continue to base its major disaster declaration recommendation on the
capability of the affected State and local governments to respond to
the event, in accordance with the requirements for a major disaster
declaration in Section 401 of the Stafford Act and 44 CFR 206.37.
---------------------------------------------------------------------------

    \16\ 44 CFR 206.40(b).
---------------------------------------------------------------------------

    Several commenters expressed concern that neither FEMA nor the
States are able to utilize an accurate estimated cost of assistance at
this time. One commenter stated that most metrics used by FEMA or the
States are based on taking the number of individuals and households
impacted and the extent of those impacts and damages, and multiplying
those totals by the maximum assistance that is available through FEMA's
IA programs. Commenters stated that the IA program has statutory limits
on the amount of relief available and that maximum IA grant award is
not indicative of the overall potential cost to make a family whole
after a disaster and does not truly articulate the ``whole community''
resources that are needed to bring the community back to pre-disaster
condition.
    While FEMA recognizes that there are difficulties in accurately
estimating the cost of assistance in the aftermath of an event, the
estimated cost of assistance has to be part of the evaluation of
whether a major disaster declaration authorizing IA is warranted
because the cost of an event is an essential component in determining
whether or not the disaster event is beyond the capabilities of a
State. FEMA calculates the estimated cost of assistance at the
conclusion of the Joint PDA and the estimated cost of the disaster is
based on the data on uninsured damage to homes collected during the
PDA. The calculation currently includes the following:
     Historical program costs for repair or replacement
assistance for uninsured owner-occupied primary residences for each of
the four dwellings assessment levels--affected, minor, major,
destroyed.
     Cost of providing temporary housing assistance based on
the U.S. Department of Housing and Urban Development (HUD) fair market
rent for the area of impacted owners and renters for each of the four
dwelling assessment levels--affected, minor, major, destroyed--as well
as for those dwellings that are now inaccessible because of the
disaster.
     Historical program costs for ONA awards.\17\
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    \17\ Damage Assessment Operations Manual: A Guide to Assessing
Damage and Impact, Page 59, Issued April 5, 2016 https://www.fema.gov/media-library-data/1459972926996-a31eb90a2741e86699ef34ce2069663a/PDAManualFinal6.pdf.
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    When developing the estimated cost of assistance, because IHP
repair and replacement assistance can only be awarded to homeowners,
FEMA uses the homeownership rate to estimate the number of homeowners
in the disaster affected area. Additionally, since IHP is only able to
provide awards to uninsured individuals, FEMA also considers the number
of insured versus the number of uninsured individuals when developing
the estimated cost of IHP for the disaster.
    In this final rule, FEMA is not prescribing the methods to be used
to estimate cost of assistance. FEMA believes attempting to do so would
be overly restrictive in a manner that would prevent FEMA from using
new technology, such as geographic information systems (GIS), or
otherwise updating the process, such as by updating the joint FEMA-
State preliminary damage assessment instrument. FEMA is always working
to improve the PDA process and methods of cost estimation. The
estimated cost of assistance is necessarily limited by the maximum
amount of IA grant award because the monetary amount of assistance that
can be provided to individuals and households is limited by Section
408(h) of the Stafford Act.\18\ 42 U.S.C. 5174. FEMA recognizes that
because of the statutory cap on the maximum IA assistance, in many
situations FEMA assistance will not bring the survivor back to their
pre-disaster position. States are always welcome to provide additional
estimates of the total impact of the disaster on individuals and
households,

irrespective of the statutory caps, but in general, the estimated cost
of assistance measure is useful to FEMA both for purposes of internal
planning and for purposes of obtaining a preliminary (though sometimes
incomplete) picture of total disaster impacts. To assist States, FEMA
will share estimated cost of assistance data with the State throughout
the PDA process, including final amounts.
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    \18\ For disasters occurring in Fiscal Year 2019, the maximum
amount of financial assistance provided to an individual or
household under section 408 of the Stafford Act (IHP) with respect
to any single emergency or major disaster is $34,900. See 83 FR
53281, Oct. 22, 2018. This amount is adjusted annually based on the
Consumer Price Index for All Urban Consumers as calculated by the
Department of Labor, Bureau of Labor Statistics.
---------------------------------------------------------------------------

    One commenter expressed concern that U.S. Census data on the
homeownership rate of impacted homes does not take into account that a
renter may be occupying the owner-occupied home at the time of the
disaster. In addition, some commenters stated that the homeownership
rate is not readily available during preliminary damage assessments and
the amount of time required to make a reliable estimate would cause
delays in States' submitting their major disaster declaration requests.
FEMA notes that this data point is used during the current process and
estimates are available via Census.\19\ Estimates of homeownership
rates are important because the level of needed assistance varies
between rentals and owner-occupied residences. Renters typically do not
require repair assistance because repairs are generally the
responsibility of the landlord and the property must be owner occupied
to be eligible to receive IHP assistance for repair or replacement. In
addition, as part of the PDA process, FEMA, along with State and local
partners, canvasses the disaster-impacted areas to validate the Census
data on renters. As with all data points, States should submit, and
FEMA will base its recommendation on, the best information available at
the time.
---------------------------------------------------------------------------

    \19\ The Census Housing Vacancies and Homeownership website
provides current information on homeownership rates and are
available for the U.S., regions, states, and for the 75 largest
Metropolitan Statistical Areas (MSAs). Data for all geographies are
available both quarterly and annually. https://www.census.gov/housing/hvs/index.html.
---------------------------------------------------------------------------

    A commenter suggested adding a data point that compares the known
homeowner insurance population with the actual population of a
particular county or parish. The commenter stated that many rural
residents who sustain damages from a disaster may not have homeowners
insurance if they do not have a mortgage. FEMA notes that we do not
prescribe the specific method of how to calculate the insurance
penetration rate in this final rule but we will use the best method
available. At this time, PDA teams may consider any relevant factors in
estimating the insurance rate for the affected households, which may
include, among other considerations, whether the affected area was
rural, suburban, or urban.
    A commenter suggested comparing the average amount of homeowner
insurance deductible in a given county or parish against the income for
such county or parish, because often insurance deductibles are too high
for residents to pay out of pocket after a disaster. In addition, a
homeowner who cannot afford to pay the deductible will be unable to
fully recover after the disaster. FEMA notes that the issue of high
insurance deductibles has arisen in the past, often in earthquake
events. FEMA considers a homeowner with a high deductible to be
underinsured. States may provide information on deductible rates for
the peril in the affected area and FEMA will utilize that information
when evaluating the sufficiency of the insurance coverage in place and
determining the number of underinsured homeowners who may require
Federal assistance. FEMA did not make any changes based on this
comment.
    A commenter stated that FEMA seems to believe that every Insurance
Commissioner's Office keeps a record of every single policy issued in
the State, along with limits, exclusions, and types of coverage. The
commenter stated that they have never heard of a State Insurance
Commissioner's Office that has access to such a database. FEMA fully
recognizes that the availability and quality of insurance data varies
widely from State to State. Some State Insurance Commissioner's Office
have information that can be utilized to provide or contribute to
estimates of insurance coverage. For certain States, the best option
may be the State Insurance Commissioner's Office, but for other States
it may be a different source. FEMA notes that it is important to
develop an insurance coverage estimate because, under Section 320 of
the Stafford Act (42 U.S.C. 5155), FEMA is statutorily prohibited from
duplicating insurance coverage. If the vast majority of damage will be
covered by insurance, a Presidential declaration may be unnecessary. As
stated previously, States should make their requests based on the best
information available to them at the time. In the final rule, FEMA has
not prescribed a specific source for this data, because currently
available sources have variable coverage, and more complete sources may
become available in the future.
    One commenter recommended adding a data point to capture the number
of uninsured or underinsured losses from individuals who were required
to carry flood insurance as a result from previously accepting disaster
assistance. FEMA does access this information during a disaster by
looking at National Flood Insurance Program data. FEMA already
considers this information when looking at the insurance component and
we view it as a consideration that exists implicitly within the
insurance coverage data point of the final rule.
    A commenter raised concerns that the amount of time it would take
to determine damages, insurance, and specific insurance riders
regarding whether specific disaster damages are covered would make the
30 day window to request a major disaster declaration for IA
unattainable. FEMA does not expect the States to provide an
unreasonable level of detail or specificity for the insurance data
point. FEMA expects a State to provide the best estimate of data within
the time frame available. A State should make their major disaster
declaration request in the timeframe appropriate to the size and impact
of the event and should not delay in order to gather additional
information, even if such information would be more precise or useful.
    A commenter stated that although they are encouraged that FEMA
plans to pursue better data to inform its insurance penetration rate
determinations, they raised concerns that FEMA previously promised to
identify alternative insurance data sources in the past but has made
little progress. FEMA continues to work to find the best information
regarding insurance coverage and is committed to finding the most
thorough and accurate sources for insurance data. However, at this
point, such thorough and accurate sources either do not currently exist
or are not currently available to FEMA. As such, FEMA cannot prescribe
the method or source for obtaining insurance data in this final rule
because we anticipate that there will be better methods in the future.
FEMA has not made any changes based on this comment.

C. 44 CFR 206.48, Paragraph (b)(3)--Disaster Impacted Population
Profile

    The proposed Disaster Impacted Population Profile factor related to
the demographics of impacted communities, and identified the following
data points as sub-factors:
     The percentage of the population for whom poverty status
is determined.
     The percentage of the population already receiving
government assistance such as Supplemental Security Income and
Supplemental Nutrition Assistance Program benefits.

     The pre-disaster unemployment rate.
     The percentage of the population that is 65 years old and
older.
     The percentage of the population 18 years old and younger.
     The percentage of the population with a disability.
     The percentage of the population who speak a language
other than English and speak English less than ``very well.''
     Any unique considerations regarding American Indian and
Alaskan Native Tribal populations raised in the State's request for a
major disaster declaration that may not be reflected in the data points
referenced in paragraphs (b)(3)(i)-(vii) of this section.
    FEMA received comments from 8 commenters regarding this factor. The
commenters stated that consideration should be given to non-citizen
populations that are affected by a disaster; that although special
populations were already a factor of consideration, the expansion of
this into 8 data points would be burdensome on States during response
activities; that the proposed disaster impacted population data points
would provide a better overall understanding of the community impacted
and the resources needed; and that the proposed disaster impacted
population profile data points are to be commended because the factor
would better highlight the severity of impact to the community.
    Two commenters stated that in the Commonwealth of the Northern
Mariana Islands, they face extenuating and unique situations because
they have a relatively large population of aliens as compared to U.S.
citizens and nationals. The commenters asked that FEMA consider
allowing direct financial support for that specific population. FEMA is
statutorily prohibited from providing certain types of Federal
assistance to aliens who are not qualified aliens.\20\ Specifically,
recipients of IHP and DUA must certify that they are U.S. citizens,
non-citizen nationals of the United States, or qualified aliens. That
prohibition is statutory and it cannot be altered through this final
rule.
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    \20\ The Personal Responsibility and Work Opportunity
Reconciliation Act Of 1996, Title IV, Public Law 104-193, 110 Stat.
2105 (Aug. 22, 1996). See 8 U.S.C., Chapter 14--Restricting Welfare
and Public Benefits for Aliens, 8 U.S.C. 1611-1646.
---------------------------------------------------------------------------

    A commenter raised concerns that the proposed rule did not include
any requests for information on indigent populations. FEMA notes that
the proposed rule included a number of such requests, including
specific sub-factors seeking information on the percentage of the
population for whom poverty status is determined and the percentage of
the population already receiving government assistance such as
Supplemental Security Income and Supplemental Nutrition Assistance
Program benefits. If a State believes, based on the circumstances of a
disaster event, that there is additional population-related information
that needs to be considered, the State should include such information
in its request for a major disaster declaration authorizing IA.
    A commenter stated that, although special populations were already
a factor of consideration, the expansion of this into 8 data points
would be burdensome on States during response activities. FEMA notes
that the State is not required to provide any of these data points. If
the State wishes to provide such data points, they are publicly
available.\21\ States commonly provide these data points to FEMA as
part of a declaration request; FEMA is merely clarifying a common
source for these data points going forward. The disaster impacted
population profile data points can be found by the State prior to a
disaster even occurring and will only need to be pulled once a year.
---------------------------------------------------------------------------

    \21\ Poverty data comes from the U.S. Census Small Area Estimate
Branch, ``Poverty and Median Income Estimates for Counties.''
Supplemental Nutrition Assistance Program data is from the U.S.
Census's American Community Survey (ACS) using the American
FactFinder (https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml), Advanced Search, Geographies: ``All Counties within
the United States,'' Topics: S2201, 5-year estimates. Supplemental
Security Income data comes from ACS using the American FactFinder,
Advanced Search, Geographies: ``All Counties within the United
States,'' Topics: B19056, 5-year estimates. The unemployment data at
the State and county level are available at https://www.bls.gov/lau/. Data on county populations of ``65 or Older'' and ``18 or
Younger'' data comes from the ACS using the American FactFinder
(https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml),
Advanced Search, Geographies: ``All Counties within the United
States,'' Topics: DP05, 5-year estimates. Data on populations with a
disability comes from the ACS, American FactFinder (https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml), Advanced
Search, Geographies: ``All Counties within the United States,''
Topics: S1810, 3-year estimates. Data on ``percent of population who
speaks English less than very well'' comes from the ACS, American
FactFinder (https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml), Advanced Search, Geographies: ``All Counties in the
United States,'' Topics: B06007, 5-year estimates. Data on American
Indian and Alaska Native populations comes from the ACS, American
FactFinder (https://factfinder.census.gov/faces/nav/jsf/pages/index.xhtml), Advanced Search, Geographies: ``All Counties within
the United States,'' Topics: DP05, 5-year estimates. FEMA may update
these sources to account for future improvement and changes in the
U.S. Census, BLS, BEA, and Treasury data reporting, and the sources
are provided here for example.
     For definitions related to demographic data points, please
refer to the associated organizations websites. For example, refer
to U.S. Census Small Area Income and Poverty Estimates definitions
at https://www.census.gov/topics/income-poverty/poverty/about/glossary.html for percentage of the population for whom poverty
status is determined. For a definition of the pre-disaster
unemployment rate, refer to Bureau of Labor Statics at http://www.bls.gov/bls/glossary.htm and search for the term ``unemployment
rate''. The U.S. Census glossary at http://www.census.gov/glossary
and American Community Survey also provide definitions related to
demographic data points including the following terms: Assistance
and Subsidies, Age, Disability, Language Spoken at Home, and Ability
to Speak English.
---------------------------------------------------------------------------

    Two commenters noted that the proposed rule changes added several
very beneficial factors, including the additional components to the
Disaster Impacted Populations profile, the Impact to Community
Infrastructure, and the separate consideration for Disaster Related
Unemployment. The commenters stated that these proposed factors would
better highlight the severity of a disaster's impact to the community
and would provide a better overall understanding of the community
impacted and the resources needed. The commenters also stated that the
proposed factors would facilitate a more nuanced understanding and
approach to the unique recovery needs of communities in the aftermath
of a disaster.

D. 44 CFR 206.48, Paragraph (b)(4)--Impact to Community Infrastructure

    The proposed Impact to Community Infrastructure factor related to
certain impacts to a community's infrastructure that may adversely
affect a population's ability to safely and securely reside within the
community. The proposed rule identified the following sub-factors:
     Lifesaving and life-sustaining services. The effects of a
disaster may cause disruptions to or increase the demand for lifesaving
and life-sustaining services, necessitate a more robust response, and
may delay a community's ability to recover from a disaster. The State
may provide information regarding the impact on life saving and life
sustaining services for a period of greater than 72 hours. Such
services include but are not limited to police, fire/EMS, hospital/
medical, sewage, and water treatment services.
     Essential community services. The effects of a disaster
may cause disruptions to or increase the demand for essential community
services and delay a community's ability to recover from a disaster.
The State may provide information regarding the impact on essential
community services for a period greater than 72 hours. Such services
include but are not limited to schools, social services programs and
providers, child care, and eldercare.

     Transportation infrastructure and utilities.
Transportation infrastructure or utility disruptions may render housing
uninhabitable or inaccessible. Such conditions may also affect the
delivery of life sustaining commodities, provision of emergency
services, ability to shelter in place, and efforts to rebuild. The
State may provide information regarding the impact on transportation
infrastructure and utilities for a period of greater than 72 hours.
    FEMA received comments from 9 commenters regarding this proposed
factor. The commenters asked for more information regarding how FEMA
expects States to provide this information; suggested that the
additional requested data would be burdensome to collect; and requested
that FEMA elaborate on the scope of the ``Impact to Community
Infrastructure'' factor to include the effects of a cyber-event or
other evolving threat.
    The information included in the ``Impact to Community
Infrastructure'' factor is already typically provided, where relevant,
in States' major disaster declaration requests for IA. States typically
identify any critical infrastructure disruptions in their major
disaster declaration requests for IA because it illustrates the impact
of the disaster on the community as whole. FEMA recognizes that
communication may be difficult after a disaster, and FEMA expects that
State and local officials will provide the best information they have.
None of this information is required, if the State does not wish to
provide it. The information for major disaster declaration requests for
IA is often based on initial assessments that allow both the State and
FEMA to evaluate the situation. FEMA currently encourages States to do
the IA PDA before the PA PDA, and encourages States to submit their
requests even if they are still awaiting the completion of the PA PDA.
    A commenter raised concerns that the proposed ``Impact to Community
Infrastructure'' factor could potentially lead to a disaster
declaration that traditionally would be a PA-only major disaster
declaration to now be an IA major disaster declaration as well. In
addition, a commenter expressed concern about how the States would
collect and deliver this information because many disaster events only
receive a joint FEMA-State PDA for either PA or IA. As noted in the
proposed rule, the ``Impact to Community Infrastructure'' factor is
intended to help FEMA evaluate the disaster impacts on infrastructure
and how it may affect the individuals in that community. PA PDA teams
conduct assessments to estimate the costs to repair and replace
infrastructure, but a major disaster declaration request for IA would
not require that level of detail. For IA, FEMA is not evaluating how
much it will cost to fix a bridge that was washed out during a flood;
however, FEMA believes it is important to know how many people are
impacted because that bridge is now unavailable. A bridge that is
washed out could severely impact an individual's ability to remain in
their home or to travel to and from work, which would necessitate IA.
    A commenter raised that FEMA should expand the scope of the
``Impact to Community Infrastructure'' factor to ensure that
application of the Stafford Act evolves at the pace of real-world
threats, to include the effects of evolving threats, such as cyber-
attacks. FEMA encourages planning and preparing for potential cyber-
attacks. FEMA believes that the final rule is flexible enough to allow
FEMA to evaluate whether IA programs would be appropriate and necessary
following a cyber-event that affected individuals and households. It is
important to note that some FEMA programs may not be well suited to
address damage caused by cyber events and other evolving threats, and
not all such events or threats will result in eligibility for a
Stafford Act declaration.

E. 44 CFR 206.48, Paragraph (b)(5)--Casualties

    The proposed Casualties factor related to the number of individuals
who are missing, injured, or deceased due to a disaster. FEMA received
comments from 4 commenters regarding this proposed factor. The
commenters noted that the change for this factor was an increase in
specificity in the regulation because the proposed factor included a
request for information on missing individuals in addition to injured
and deceased individuals. In addition, commenters felt that a lack of
casualties should not be used by FEMA to deny a major disaster
declaration request for IA. FEMA has made no changes to the
``Casualties'' factor in the final rule from what was proposed in the
proposed rule. Data on the number of missing, injured, and deceased are
currently provided by the State to FEMA and FEMA is clarifying in
regulation the continued need for these data points. Casualties, or a
lack thereof, will never be the only factor considered in a major
disaster declaration authorizing IA determination. However, there may
be events with borderline levels of damage to residences, but with a
high number of casualties that point to a level of trauma warranting
Federal assistance.

F. 44 CFR 206.48, Paragraph (b)(6) --Disaster Related Unemployment

    The proposed Disaster Related Unemployment factor called for
consideration of the number of disaster survivors who lost work or
became unemployed due to a disaster and who do not qualify for standard
unemployment insurance. The proposed factor welcomed States to provide
an estimate of the number of such unemployed disaster survivors as well
as information regarding major employers affected.
    FEMA received comments from 8 commenters regarding this proposed
factor. Some commenters applauded the proposal to continue to collect
this information. Others expressed concerns that a State may not be
able to gather the requested unemployment data within the 30 day
declaration request period. Some commenters stated that a State
typically uses potential disaster unemployment claims for a USDA
agriculture related disaster request but adding this information to a
major disaster request for IA may be worth the time and resources when
many businesses are impacted. Others stated that FEMA should not use
potential low level of unemployment claims due to a major disaster as a
negative factor against a State in determining whether a declaration is
warranted.
    FEMA understands that there are certain disaster situations where
gathering certain types of information may be difficult. This
information may not be necessary or relevant for the typical major
disaster declaration request that is seeking IA. Generally, when a
disaster event warrants IA, Disaster Unemployment Assistance is
appropriate as well. This information is already provided by States
when they request Disaster Unemployment Assistance as part of their
major disaster declaration request. If needed, States may submit
extension requests. This factor will primarily be relevant in instances
where the effect of the disaster event is mainly economic and Disaster
Unemployment Assistance is the only program that a State requests. FEMA
will not use a low level of unemployment claims due to a major disaster
as a negative factor in determining whether a request for other forms
of disaster assistance is warranted. However, a low level of
unemployment claims due to a major disaster may be indicative that
Disaster Related Unemployment is unnecessary even though other IA
programs are necessary to assist a community recover post-disaster
event.

G. Principal Factors for Evaluating the Need for the Individuals and
Households Program

    FEMA proposed that the principal factors it will consider in
evaluation of any major disaster declaration request for IHP will be
the fiscal capacity of the requesting State (44 CFR 206.48(b)(1)(i))
and the uninsured home and personal property losses (44 CFR
206.48(b)(2)). FEMA found that the ratio of IA Cost to Capacity (ICC),
which is the estimated cost of IA divided by a State's TTR in millions,
was particularly indicative of the likelihood of a declaration. FEMA
received comments from 4 commenters regarding this proposal. The
commenters expressed general opposition to FEMA using the ICC
calculation as an evaluation tool for whether IHP is warranted and
suggested that the ICC calculation is a mathematical formula or
``threshold'' that is prohibited by the Stafford Act.
    A commenter stated that the ICC calculation proposed by FEMA for
determining whether IHP is warranted is a mathematical formula that is
specifically prohibited by the Stafford Act. The commenter stated that
the formulaic evaluation of a major disaster request does not meet the
spirit and intent of the Stafford Act. Section 320 of the Stafford Act
prohibits the denial of assistance to a geographic area based solely on
the use of an arithmetic formula or a sliding scale based on income or
population. 42 U.S.C. 5163. The ICC ratio compares the estimated of
cost of assistance and the State's TTR. Although the ICC ratio is an
arithmetic formula based in part on income flows, FEMA does not plan to
deny assistance to any geographic area based solely on the results of
this formula. Rather, the results are only one factor (albeit an
important one) that FEMA will consider, in the totality of the
circumstances, when making its recommendation to the President. The
comparison of the principal factors will be considered in conjunction
with the other factors that are provided in the final rule. FEMA has
revised the regulatory text at 44 CFR 206.48(b) to make clear that FEMA
will always consider all relevant information submitted as part of a
declaration request.
    FEMA believes that it is appropriate to use ICC as a measure of the
need for IHP because at its core, the determination of whether to
recommend a major disaster declaration authorizing IHP depends on the
impact of the event being beyond a State or local government's
capability. Such a determination necessarily entails an assessment of
the impact of the event in the context of a State's fiscal capacity and
resources. FEMA recognizes that every disaster is different and
circumstances vary among States. Ultimately, however, the ICC compares
two factors that are undeniably relevant to FEMA's recommendation to
the President. These factors will not be used to the exclusion of all
others; FEMA will continue to evaluate each request on its own merits,
including by reference to the other factors identified in this rule.
    A commenter opined that although FEMA states that the ICC is not a
hard threshold, the practical result is that of a threshold. FEMA does
not agree that the ICC will act as a threshold. The ICC statistics
provided in the NPRM were based on historical declaration requests and
they show levels of ICC for events that were approved at a high
frequency, denied at a high frequency, and for events that fell in the
middle. FEMA believes the ICC evaluation provides a more systematic way
to look at the information and creates a more useful decision framework
to evaluate a major disaster declaration request for IA than the
current evaluation process. FEMA provided this historical data to help
guide States for planning in future disaster situations, and FEMA will
continue to update this data based on major disaster declaration
request determinations in the future. FEMA is not planning to use the
ICC calculation as a hard ``threshold.''

H. Lack of Thresholds

    FEMA received comments that expressed disappointment at a lack of
clear thresholds or other guidance regarding what amount of damage
would definitively warrant a major disaster declaration authorizing IA.
FEMA will not be using a threshold because it would unnecessarily limit
FEMA's ability to advise the President and would not allow FEMA to
fully consider all factors that may be relevant for the unique
circumstances of a disaster and its impact on the State. FEMA
understands that some States prefer additional clarity for planning
purposes, i.e., to help States decide whether they should or should not
submit a major disaster declaration request for a given disaster event.
While FEMA will not be establishing a threshold, FEMA issued an
additional proposed guidance document for comment on September 22, 2016
at 81 FR 65369 that further fleshed out the details of how FEMA will
evaluate the factors. Following consideration of the comments received,
FEMA is issuing the final guidance today; a notice of availability
regarding that guidance document is published elsewhere in today's
Federal Register along with this final rule. In addition, FEMA will
periodically publish aggregate PDA data on FEMA's website which States
can use to evaluate the likelihood of receiving a major disaster
declaration for a specific event and to plan for future events.

I. IA Declarations Factors Guidance

    Several commenters raised concerns regarding the IA Declarations
Factors Guidance which FEMA indicated would support the proposed rule.
The commenters asked for information on when the guidance would be
published, wanted clarity on how the factors will be weighted, and
suggested that FEMA should develop appropriate guidance materials to
train State and local partners, FEMA regional office staff, and the
disaster workforce. FEMA published an additional proposed guidance
document for comment on September 22, 2016 that further fleshed out the
details of how FEMA would evaluate the factors. 81 FR 65369. The
majority of comments received on the proposed guidance document were
duplicative of what was already received on the proposed rule. The
comments that were unique and specific to the guidance are addressed in
the final IA Declarations Factors Guidance, notice of which is
published elsewhere in today's Federal Register along with this final
rule.
    Commenters asked for clarity on how the factors would be evaluated
by FEMA. As stated above, FEMA intends to provide additional clarity
regarding evaluation of the factors through guidance documents. These
guidance documents will aid States and Territories in drafting requests
for emergency and major disaster declarations including Individual
Assistance. These documents will also provide additional clarity
regarding the circumstances, in particular the severity and magnitude
relative to State capacity, under which a major disaster declaration
authorizing IA is likely to be approved or denied. This additional
clarity should allow for improved planning by the States because they
will have a better understanding of what type and size of event may
exceed their capacity to support residents without Stafford Act
assistance.
    A commenter stated that FEMA should develop appropriate guidance
materials to train State and local partners, FEMA regional office
staff, and the disaster workforce. FEMA has hosted and will continue to
host internal and external trainings and webinars for the FEMA Regional
Offices, States, Territories, and local

partners to help them become familiar with and understand the new IA
major disaster declaration factors.

J. Preliminary Damage Assessments

    Several commenters raised concerns regarding the preliminary damage
assessment process. The concerns raised include that nongovernmental
organizations (NGOs) should be invited to participate in sharing
information during the PDA process and initial response and recovery;
that FEMA should simplify the PDA process for IA and coordinate with
the Red Cross and Small Business Administration (SBA); that the
timeframe for making a major disaster declaration for IA is unclear;
and that a PDA conducted too early in certain events, such as a
flooding disaster, will not result in accurate PDAs.
    A commenter raised a concern that non-governmental organizations
need to be invited to participate in sharing information during the PDA
process and initial response and recovery. FEMA notes that non-
governmental organizations are often involved in the disaster response
in a community and provide information to the States. A State may
coordinate with their local non-governmental organizations and to
involve them in the PDA process, at the State's discretion.
    Two commenters suggested that FEMA, SBA and the American Red Cross
should develop a single standardized PDA that would collect one set of
data that all three entities can use. In general, FEMA believes that a
wholesale revision of the PDA process is outside the scope of this
rulemaking. Aside from revising a limited number of data points, this
final rule does not affect the PDA process at all. In addition, FEMA
and SBA currently do coordinate and complete PDA together when
feasible.
    A commenter requested clarity about the deadline by which a State
must request a major disaster declaration authorizing IA. States must
submit their major disaster request (or request an extension) within 30
days of the incident. 44 CFR 206.36(a). FEMA encourages States to
identify the potential need for a joint FEMA-State PDA as quickly as
possible if the State believes that a major disaster declaration is
necessary. FEMA encourages States to collect and submit information as
quickly as possible because it is important to provide assistance to
disaster survivors as soon as possible after a disaster event.
    A commenter stated that FEMA must recognize that a PDA performed
too early, particularly after a flood event, will not provide an
accurate measure of the number of homes damaged. FEMA notes that a
State is the entity that triggers the joint FEMA-State PDA, and that a
State may request an extension of the 30 day deadline if additional
time is needed to provide accurate results. For any major disaster
declaration request including IA, FEMA will work with the State to
complete the PDAs and process the declaration request as quickly as
possible. FEMA will make a major disaster declaration recommendation to
the President based on the best information available and we recognize
that early after an event not all of the information is available or
completely certain. FEMA also recognizes that the magnitude of some
events may require the State and FEMA to move ahead based only on
limited or uncertain information.

K. Amount of Data Requested

    Several commenters raised concerns that the proposed rule would
create a significant increase in the amount of data required for a
State's request for a major disaster declaration authorizing IA. The
commenters shared that, although it is appreciated that States are
being forewarned of these requirements in advance, they felt that many
of the new data points would require significant effort to assemble
which may impact expediency in submitting a major disaster request
which is in direct contradiction to section 1109 of SRIA's requirement
to ``speed a declaration of a major disaster.'' In addition, others
raised concern that under the proposed rule, FEMA would require the
States to compile a significant amount of information, regardless of
whether such information had any bearing on whether a declaration will
be declared.
    FEMA notes that most of the data points identified in the proposed
rule are already provided by States as part of the current disaster
declaration process because they are items that FEMA informally
identified as relevant data points in the past. By clearly identifying
these data points up front, the final rule will reduce the potential
that FEMA will need to reach back to the State for additional
information. In this way, FEMA believes that the rule will help speed
the process. In addition, FEMA is not compelling the States to provide
all of the data points included in this rulemaking. A State should
submit enough information that they believe justifies the need for
supplemental Federal assistance. However, it is in the State's interest
to discuss the data points highlighted in this rule along with any
other relevant information because it will illustrate to FEMA and the
President why supplemental Federal disaster assistance is necessary for
their State.

IV. Final Rule

    FEMA is finalizing the proposed rule with the two changes that are
discussed in section III of this preamble. First, FEMA is removing the
proposed ``State Services'' sub-factor. Second, FEMA is removing the
proposed ``Planning After Prior Disasters'' sub-factor. FEMA has also
revised introductory text at 44 CFR 206.48(b) to make clear that
regardless of the ratio of estimated cost of assistance to TTR for any
given event, FEMA will always consider all relevant information
submitted as part of a declaration request.

V. Regulatory Analysis

A. Executive Order 12866, Regulatory Planning and Review and Executive
Order 13563, Improving Regulation and Regulatory Review

1. Executive Summary & A-4 Accounting Statement
    Executive Orders 13563 (``Improving Regulation and Regulatory
Review'') and 12866 (``Regulatory Planning and Review'') direct
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. Executive Order 13771 (``Reducing
Regulation and Controlling Regulatory Costs'') directs agencies to
reduce regulation and control regulatory costs and provides that ``for
every one new regulation issued, at least two prior regulations be
identified for elimination, and that the cost of planned regulations be
prudently managed and controlled through a budgeting process.''
    The Office of Management and Budget (OMB) has designated this rule
a ``significant regulatory action'' although not economically
significant, under section 3(f) of Executive Order 12866. Accordingly,
the rule has been reviewed by OMB. This rule is exempt from the
requirements of Executive Order 13771 because it has de minimis costs
spread across all states and territories. See OMB's Memorandum
``Guidance Implementing Executive Order 13771, Titled `Reducing
Regulation and Controlling Regulatory Costs''' (April 5, 2017).

    FEMA estimates the final rule will impose a cost burden of $28,040
in the first year of implementation and $2,939 for each subsequent
year. FEMA estimates the ten-year present value total cost to be
$44,102 discounted at seven percent and $49,441 discounted at three
percent. FEMA estimates the annualized cost of the final rule to be
$6,279 at seven percent and $5,796 at three percent.\22\ The costs are
for training (FEMA providing and States participating in), States
becoming familiar with the regulation, both FEMA and States downloading
and saving annual data, and States changing their existing files to
account for the new factor. Benefits of the rule include clarifying
FEMA's existing practices and reducing process time and effort (back
and forth) between FEMA and States requesting a declaration.
---------------------------------------------------------------------------

    \22\ FEMA includes estimates of discounted present value costs
and annualized costs according to guidance from OMB Circular A-4.
Office of Management and Budget, Published September 17, 2003.
Available at: https://www.whitehouse.gov/sites/whitehouse.gov/files/omb/circulars/A4/a-4.pdf.
---------------------------------------------------------------------------

    FEMA does not expect the rule to affect the amount of assistance to
individuals and households for two primary reasons. First, codifying
factors that are currently captured under the ``other relevant
information'' prong of 44 CFR 206.48 provides clarity without
necessarily changing current practice. Since 1999,\23\ FEMA has
evaluated and improved its IA declarations practices continuously so
that FEMA can incorporate consideration of new information sources as
they have become available. This rule reflects the evolution of those
efforts by codifying currently used factors, as well as adding one new
factor to evaluate the fiscal capacity of States' abilities to respond
to and recover from a declared disaster. Second, the new fiscal
capacity factor is highly correlated to previously captured data on
State population \24\ and is expected to result in comparable
declaration recommendations. FEMA believes including the new fiscal
capacity factor provides a more comprehensive picture of a State's
ability to respond to and recover from a declared disaster.
---------------------------------------------------------------------------

    \23\ On September 1, 1999, 44 CFR 206.48 was finalized in
regulation. See 64 FR 47698.
    \24\ The correlation is based on the new fiscal capacity sub-
factors. The primary sub-factor that will be used is Total Taxable
Resources (TTR), which measures the unduplicated sum of the income
flows produced within a State and income flows received by its
residents that a State can potentially tax. See United States
Department of the Treasury, ``Treasury Methodology for Estimating
Total Taxable Resources (TTR),'' Revised November 2002, page 2,
https://www.treasury.gov/resource-center/economic-policy/Documents/nmpubsum.pdf. Accessed and downloaded November 9, 2015. Because TTR
is available at the State level only, Gross Domestic Product (GDP)
by State will be used as the fiscal capacity indicator for
territories and other areas when TTR is not available. In general,
GDP by State is estimated using two procedures. The first one uses
State-level Census Bureau value-added data for goods-producing
industries to estimate GDP by State for those industries. The second
procedure uses Census Bureau receipts and payroll data, or company
financial data to estimate gross operating surplus for the services-
producing industries. Both procedures use income received by a
State's residents as a primary component. See United States
Department of Commerce, Bureau of Economic Analysis, ``GDP by State
Estimation Methodology,'' page 2, https://www.bea.gov/sites/default/files/methodologies/0417_GDP_by_State_Methodology.pdf. Accessed and
downloaded February 15, 2017.

                                          Table 1--A-4 Accounting Table
----------------------------------------------------------------------------------------------------------------
                                              Estimates                                  Units
                               ---------------------------------------------------------------------------------
           Category               Primary        Low          High         Year       Discount
                                  estimate     estimate     estimate      dollar     rate  (%)   Period  covered
----------------------------------------------------------------------------------------------------------------
Benefits:
    Annualized Monetized......          n/a          n/a          n/a          n/a            7  n/a.
                                        n/a          n/a          n/a          n/a            3  n/a.
    Annualized Quantified.....          n/a          n/a          n/a          n/a            7  n/a.
                                        n/a          n/a          n/a          n/a            3  n/a.
----------------------------------------------------------------------------------------------------------------
    Qualitative...............   The final rule more clearly identifies declaration factors FEMA considers when
                                 making its recommendation to the President on a major disaster declaration that
                                authorizes IA than current regulations. The rule codifies factors FEMA currently
                                  considers, but are not specified in 44 CFR 206.48(b) and adds one new factor
                                  that will provide additional information on fiscal capacity. FEMA anticipates
                                 that this final rule will result in regulatory efficiencies due to reduced back
                                    and forth between FEMA and the State that is requesting the declaration.
                                    Currently, the amount of back and forth between FEMA and the State is not
                                                                    tracked.
----------------------------------------------------------------------------------------------------------------
Costs:
    Annualized Monetized......       $6,279          n/a          n/a         2015            7  10 years.
                                     $5,796          n/a          n/a         2015            3  10 years.
    Annualized Quantified.....          n/a          n/a          n/a  ...........            7  10 years.
                                        n/a          n/a          n/a  ...........            3  10 years.
                               ---------------------------------------------------------------------------------
    Qualitative...............  None.
----------------------------------------------------------------------------------------------------------------
Transfers:
    Federal Annualized                  n/a          n/a          n/a          n/a            7  n/a.
     Monetized.
                                        n/a          n/a          n/a          n/a            3  n/a.
                                            --------------------------             -----------------------------
    From/To...................        From:             n/a                    To:              n/a.
                                            --------------------------             -----------------------------
    Other Annualized Monetized          n/a          n/a          n/a          n/a            7  n/a.
                                        n/a          n/a          n/a          n/a            3  n/a.
                                            --------------------------             -----------------------------
    From/To...................        From:             n/a                    To:              n/a.
----------------------------------------------------------------------------------------------------------------
Effects:

    State, Local, and/or        State governments are the only entities directly affected by this rule. Benefits
     Indian Tribal Governments.  include expected regulatory efficiencies due to reduced back and forth between
                                 FEMA and the State requesting the major disaster declaration that includes IA.
----------------------------------------------------------------------------------------------------------------
                                  Increased costs resulting from the rule are from training, becoming familiar
                                  with the new rule, downloading the fiscal capacity factor data, and changing
                                   existing templates and files to account for the new factor. These costs are
                                  expected to occur in year 1. Costs in subsequent years from updating the data
                                                            are expected to be small.
----------------------------------------------------------------------------------------------------------------
    Small Business............                                     No Impact.
    Wages.....................                                    Not Measured.
    Growth....................                                    Not Measured.
----------------------------------------------------------------------------------------------------------------

2. Need for Regulatory Action
    This final rule provides clarity on the declaration factors that
FEMA currently considers in support of its recommendation to the
President on whether a major disaster declaration authorizing IA is
warranted. FEMA expects the additional clarity will reduce delays in
the declaration process by decreasing back and forth between States and
FEMA. FEMA also is adding one new factor--Fiscal Capacity--to provide
additional context on States' capacity to respond to and recover from
disaster situations. Finally, the rule will satisfy the requirements
outlined in Section 1109 of SRIA.
3. Affected Population
    A request for a Federal major disaster declaration authorizing IA
must come from a State's Governor or designated equivalent. 44 CFR
206.36(a). Therefore, the rule directly affects all States that are
eligible to request a Federal major disaster declaration authorizing
IA. States are defined in 44 CFR 206.2(a)(22) and include any State of
the United States, the District of Columbia, Puerto Rico, the Virgin
Islands, Guam, American Samoa, and the Commonwealth of the Northern
Mariana Islands.\25\
---------------------------------------------------------------------------

    \25\ There are 56 States, as defined by 44 CFR 44 CFR
206.2(a)(22). Throughout this analysis, ``States'' means the total
number of governmental jurisdictions that include the 50 U.S.
States, District of Columbia, and the 5 territories listed.
---------------------------------------------------------------------------

    Although Section 1110 of SRIA amended the Stafford Act to allow
federally recognized Indian Tribal governments to submit requests for
emergency or major disaster declarations, SRIA charged FEMA to
implement that authority separately by rulemaking. Declarations
requested by Tribal governments will be covered by a separate process
and are not included in this rule. For this reason, Tribal governments
are not directly affected by this rule. Local governments also are not
directly affected by the rule because the disaster-related information
local governments provide to the State is part of their current
disaster response process, which is to provide situational awareness
and ascertain the need for further emergency assistance.\26\
---------------------------------------------------------------------------

    \26\ The National Response Framework defines the roles and
responsibilities of key partners at the local, tribal, State, and
Federal levels. Local governments/jurisdictions are responsible for
ensuring the public safety and welfare of their residents. Local
police, fire, emergency medical services, public health and medical
providers, emergency management, public works, environmental
response professionals, and other in the community are often the
first to detect a threat or hazard, or respond to an incident. As
first responders, local governments provide situational awareness on
the incident and request immediate emergency relief to ensure public
safety and welfare, i.e. debris removal and/or emergency protective
measures. See National Response Framework, Third Edition, pages 11-
12, https://www.fema.gov/media-library-data/1466014682982-9bcf8245ba4c60c120aa915abe74e15d/National_Response_Framework3rd.pdf.
Accessed and downloaded February 15, 2017.
---------------------------------------------------------------------------

4. Current Baseline and Impacts of Final Rule
    The rule largely codifies many considerations that FEMA has used
for several years under the ``other relevant information'' prong of 44
CFR 206.48, but were not specifically identified in FEMA regulations.
FEMA conducted a retrospective review of State major disaster
declaration letters that requested IA and found that States typically
included more information and data than what is specifically identified
in the current regulations and listed at 44 CFR 206.48(b).\27\
---------------------------------------------------------------------------

    \27\ FEMA reviewed all 85 State major disaster declaration
request letters submitted between January 1, 2012 and December 31,
2016, and found that each letter was unique and provided many of the
data points and information that will be explicitly included under
the regulation. The information submitted varied depending on the
disaster, the scope of damages, and the need for assistance. FEMA
does not require every data point to be submitted when a State makes
a declaration request. FEMA found that some requests had more data
and/or information, while other requests had less. For instance, in
more severe events in less resilient areas, the States did not need
to provide a large amount of information to be recommended for a
declaration. In these instances, the individual assistance needs
were clearly outside the capacity of the requesting State.
---------------------------------------------------------------------------

    FEMA's review examined the 85 major disaster declaration requests
for IA that States submitted between January 1, 2012 and December 31,
2016. All were examined, whether the declaration was granted or denied.
FEMA found that the four new Fiscal Capacity sub-factors had not been
provided previously by States; however, when States provided
qualitative information on the State's economic health, they may also
have provided median household income. FEMA found that out of the
remaining 23 sub-factors, 19 were provided in at least 80 percent of
the requests and only 4 were provided in less than 20 percent of the
request letters. All 4 are sub-factors of the Disaster Impacted
Population Profile factor. Specifically, the percentage of population
already receiving government assistance such as Supplemental Security
Income and Supplemental Nutrition Program benefits appeared in only 5
percent of the requests (4 occurrences in 85 total requests); the
percentage of the population who speak a language other than English
and speak English less than ``very well' in only 7 percent of the
requests (6 occurrences in 85 total requests); the percentage of
population 18 years old and younger in only 18 percent (15 occurrences
in 85 total

requests); and any unique considerations regarding American Indian and
Alaskan Native Tribal populations that may not be reflected in the U.S.
Census Bureau data in only 18 percent of the requests (15 occurrences
in 85 requests). FEMA found that these specific sub-factors of
population were specifically included by States when they believed the
disaster adversely affected and heighted the vulnerability of these
particular segments of the population. This is consistent with FEMA's
long-standing practice of considering how any given disaster affects
populations that are 65 years and greater or have a disability. The
detailed findings are presented in Table 5, and in the marginal
analysis table posted in the docket at www.regulations.gov. These
findings established the baseline from which the costs of this rule
were estimated.
    Because FEMA and States already are gathering and providing much of
this information, FEMA anticipates minimal impact to States. FEMA does
not expect or require States to include every factor in every
declaration request. FEMA expects that States will continue to provide
a comparable level of information in their request letters, based on
their respective circumstances and disaster effects.
    Indian Tribal governments (requesting assistance through the State)
and local governments currently provide the State with specified factor
information for their local area and affected residents. Therefore,
FEMA anticipates Indian Tribal governments (requesting assistance
through the State) and local governments will not directly incur
additional costs from the rule.
    As previously discussed, the new factor FEMA is adding is Fiscal
Capacity. Both FEMA and States will be affected by the addition of this
factor. For FEMA, the increase in burden will result from annually
collecting the information and providing it to the States. This
increase in burden is expected to begin in year 1 and remain the same
for each subsequent year. FEMA also will incur a cost for providing IA
declaration factors training. For States, an increase in burden will be
realized in the first year when States download the fiscal capacity
data, adjust their templates and files to accommodate the new Fiscal
Capacity factor, and attend IA declaration factor training. In each
subsequent year, the burden for States is expected to decrease from
year 1 because it will be for downloading and storing the fiscal
capacity data only. FEMA will provide a link on its website to the data
in addition to downloading and storing the information for its own
reference. FEMA assumes that States will download and store the data in
subsequent years prior to any major disaster so that the information is
readily available if they need to request IA. In addition, once a State
has downloaded and stored this data for one disaster, the State is
likely to keep the data on hand for future reference and to meet
administrative records retention policies.
    FEMA does not expect the new Fiscal Capacity factor to affect the
number of IA declaration requests made by States or change the amount
of IA assistance provided. The new factor is highly correlated to data
previously used; thus, would have likely resulted in comparable
declaration recommendations had it been used. For this reason, the
final rule is expected to result in comparable recommendations in the
future and the rule is not expected to affect transfer payments.
    Fiscal Capacity. FEMA recognizes that each State's capacity to
respond and recover varies based on the circumstances of the disaster
and the State's resources. FEMA includes fiscal capacity data to better
evaluate a State's ability to adequately respond to a disaster with or
without supplemental Federal assistance. The GAO suggested in multiple
reports that FEMA should incorporate States' fiscal capacity into its
considerations when recommending disaster declarations to the
President. All of the GAO reports focused on including fiscal capacity
in FEMA's PA declaration factor criteria. FEMA believes there also is a
need to assess a State's capacity to respond and recover on its own
when determining whether a major disaster declaration that authorizes
IA is warranted.
    To evaluate a State's fiscal capacity for response to a major
disaster, FEMA will review data on a State's TTR.\28\ The U.S.
Department of Treasury (Treasury) calculates the TTR of each State,
which is used as a measure of a State's fiscal capacity.\29\ TTR is
based on Gross Domestic Product (GDP) by State, measuring the
unduplicated sum of the income flows produced within a State, but makes
adjustments for additional, potentially taxable income flows earned by
residents from out-of-state sources such as capital gains and commuter
income.\30\ FEMA acknowledges that TTR does not capture a State's
actual tax revenue or expenditures and cannot be viewed as a financial
accounting of a State's budget. The GAO supports the use of TTR as a
measure of a State's fiscal capacity because it provides a more
comprehensive measure of a State's fiscal capacity when compared to
other options, which do not include the additional, potentially taxable
income flows earned by residents from out-of-state sources such as
capital gains and commuter income.\31\
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    \28\ Pursuant to Public Law 102-321, the U.S. Department of the
Treasury produces annual estimates of total taxable resources (TTR)
for all States. The TTR estimates are published by September 30th
each year and have a two-year lag. For example, TTR for 2016 was
published on September 28, 2018. The formula for calculating TTR
uses gross state product as its base, subtracts non-taxable
components, then accounts for cross-border income flows. This
calculation provides a ``. . . comprehensive measure of all the
income flows a state can potentially tax.''
    \29\ GAO Report 12-838 stated that other Federal departments and
agencies have used TTR data to determine a jurisdiction's fiscal
capacity and the extent to which a jurisdiction should be eligible
for Federal assistance; specifically the Department of Health and
Human Services' Substance Abuse and Mental Health Services
Administration's block grant program and Community Mental Health
Service use TTR. Federal Disaster Assistance, Improved Criteria
Needed to Assess a Jurisdiction's Capability to Respond and Recover
on Its Own, GAO-12-838, September 2012, pages 31-32. http://www.gao.gov/products/GAO-12-838. Accessed and downloaded November 9,
2015.
    \30\ United States Department of the Treasury, ``Treasury
Methodology for Estimating Total Taxable Resources (TTR),'' Revised
November 2002, page 2, https://www.treasury.gov/resource-center/economic-policy/Documents/nmpubsum.pdf. Accessed and downloaded
November 9, 2015.
    \31\ United States Government Accountability Office, FEDERAL
DISASTER ASSISTANCE: Improved Criteria Needed to Assess a
Jurisdiction's Capability to Respond and Recover on Its Own, GAO-12-
838, September 2012, page 31. http://www.gao.gov/products/GAO-12-838. Accessed and downloaded November 9, 2015.
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    Further, FEMA is removing the ``Average Amount of Assistance per
Disaster'' table that is found at the current 44 CFR 206.48(b)(6) which
was based on outdated (1990 Census Data) population numbers and
simplistic size categories that grouped States into only three
categories: Small, medium, and large. Removing this table and instead
using TTR will allow a State and FEMA to include a State-specific
assessment of that State's fiscal capability when responding to a major
disaster.
    FEMA conducted a retrospective analysis of its recommendations and
major disaster declarations by the President and confirmed they are
correlated to the fiscal capacity of the requesting State, as
represented by State TTR data. Historically, FEMA captured an aspect of
fiscal capacity when evaluating the damage caused by each disaster in
relation to the population of the affected State. States with the
highest State TTRs tended to have the highest population. Based on this
analysis, FEMA found that major disaster declarations authorizing IA
have a correlation to the fiscal capacity

of the requesting State, as represented by the State TTR data.
    FEMA reviewed 220 major disaster declaration requests that included
IA and were submitted between January 2008 and December 2016.\32\ The
purpose of the review was to determine if there would have been any
impact on a disaster determination from using State TTR to assess a
State's need for a major disaster declaration authorizing IA. Each
State request included an estimate of the costs from the damages
attributed to the disaster event. FEMA retrieved the TTR data that was
available for that State at the time of the request. For each request,
FEMA used estimated IA costs and the State's TTR to calculate a ratio
of IA Cost to (fiscal) Capacity (ICC). For example, assume a State
estimated $2,000,000 in IA costs and the State's TTR was
$30,000,000,000. FEMA then divided $30,000,000,000 by $1,000,000 to get
the State's TTR in millions, which is $30,000. ($30,000,000,000 /
$1,000,000 = $30,000) FEMA divided the estimated cost of IA, which was
$2,000,000, by $30,000 to get the ICC ratio 66.7. ($2,000,000 / $30,000
= 66.66)
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    \32\ For the analysis on TTR, FEMA excluded disaster declaration
requests that did not include a request for IA. FEMA also excluded
duplicate requests, U.S. territories' requests (because there is no
TTR data available), requests without summaries of the PDA data or
with insufficient data, and requests that involved an expedited
decision. However, expedited disaster declarations that included PDA
data and a request for IA were included. For example, the disaster
declaration request from New York for Hurricane Irene (2008, DR
4020) was included in the data set even though the declaration was
expedited because the request included an estimate for PDA. See
``New York--Hurricane Irene, FEMA-4020-DR,'' Summary of Damage
Assessment Information Used in Determining Whether to Declare a
Major Disaster, Accessed and downloaded April 11, 2017. https://www.fema.gov/pdf/news/pda/4020.pdf. FEMA will use data related to
personal income and GDP for territories. The estimated cost to
States and to FEMA for downloading and providing fiscal capacity
data are included in the analysis. See section, ``5. Impacts to
Costs, Benefits, and Transfers.''
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    Based on the ICC calculation for all 220 State requests, FEMA's
analysis shows the greater the ICC ratio for a major disaster
declaration request that included IA, especially those with ICCs above
25, the more likely the request for IA was granted. Conversely, the
lower the ICC ratio for a major disaster declaration request that
included IA, especially those with ICCs below 10, the more likely the
request for IA was denied. The following table displays the total
number of major disaster declaration requests and the total of the IA
requests that were granted by ICC ratio size. The table also shows the
percentage of granted major disaster declaration requests within each
respective ICC group.

                       Table 2--Number of IA Requests and Granted IA Requests by ICC Ratio
----------------------------------------------------------------------------------------------------------------
                                                                     Number of       Number of    Percentage  of
                                                                     requests        requests        requests
       ICC ratio (estimated cost of IHP/(TTR/$1 million))         received (2008- approved (2008- approved (2008-
                                                                       2016)           2016)           2016)
----------------------------------------------------------------------------------------------------------------
>25.............................................................              65              55              85
10-25...........................................................              71              32              45
<10.............................................................              84               8              10
                                                                 -----------------------------------------------
    Total.......................................................             220              95              43
----------------------------------------------------------------------------------------------------------------

    Based on the above data, there were 71 major disaster declaration
requests that included IA with ICC ratios between 10 and 25; and 32 of
these requests were declared major disasters that included IA. Hence,
45 percent of major disaster declaration requests with ICC ratios
between 10 and 25 that included IA were granted. FEMA believes this
approval rate helps illustrate that a number of factors are taken into
consideration when determining FEMA's recommendation, especially in
borderline events.
    In addition, FEMA's above analysis shows that the higher the
estimated cost of IA damages and the lower the State TTR, the more
likely a major disaster declaration request authorizing IA was granted
in the past. In the past, States generally provided qualitative
discussions on the effects of previous disasters, State median
household income data, and population data as indicators of their
economic health. In response to recommendations in GAO Report 12-838,
FEMA examined the effect of using TTR, rather than median household
income and population data as indicators of a State's economic ability
to support itself in the event of a major disaster and whether using
TTR would have changed FEMA's past recommendations.\33\ FEMA is
including TTR to introduce a more direct measure of State fiscal
capacity than the qualitative information already being provided by the
States.\34\ FEMA will continue to consider, when provided, information
from States on the effects of previous disasters and State median
household income and population data.
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    \33\ Although GAO Report 12-838 largely related to the Public
Assistance disaster declaration process, FEMA decided to evaluate
whether TTR could also improve the IA major disaster declaration
process.
    \34\ FEMA recognizes that TTR does not perfectly capture a
State's fiscal capacity and encourages States to provide any
information they believe support their IA declaration request.
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    FEMA found that TTR and population are highly correlated (0.984).
Although these measures are highly correlated, FEMA chose State TTR as
its preferred data point as a more direct measure of fiscal capacity
for several reasons. TTR more accurately reflects a State's ability to
respond to a disaster because TTR is a measure of fiscal capacity which
takes into consideration the population of the State and the income
flows, not just an estimate of the number of people in the State. In
addition, TTR includes much of the business income that does not become
part of the income flow to jurisdiction residents, undistributed
corporate profits, and rents and interest payments made by businesses
to out-of-jurisdiction real estate owners and lenders. FEMA concludes
that its consideration of State TTR would not have affected past
recommendations based on the above analysis that shows that TTR and
population are highlight correlated.\35\ Accordingly, FEMA anticipates
that using State TTR when making future major disaster declaration
recommendations will not reduce the number of IA declaration requests
made by States or change the amount of IA assistance provided.