On January 25, President Donald Trump signed an executive order establishing a “Council to Assess the Federal Emergency Management Agency.”  The new Federal Emergency Management Agency Review Council will advise the President “on the existing ability of FEMA to capably and impartially address disasters occurring within the United States and…all recommended changes related to FEMA to best serve the national interest.”  The Council will submit a report within 180 days, and have its first meeting within 90 days.  Although NFIP is not explicitly mentioned in the executive order, the report should contain “Other recommended improvements to FEMA in the current statutory structure.”   The Secretary of Homeland Security and the Secretary of Defense will be members of the 20-member committee, alongside other public and private sector experts.

On March 19, President Trump issued another Executive Order, “Achieving Efficiency Through State and Local Preparedness.”  Executive Order 14239 states that, “Federal policy must rightly recognize that preparedness is most effectively owned and managed at the State, local, and even individual levels, supported by a competent, accessible, and efficient Federal Government…When States are empowered to make smart infrastructure choices, taxpayers benefit.”  The Executive Order mandates the publishing of a National Resilience Strategy that “articulates the priorities, means, and ways to advance the resilience of the Nation.”  The Assistant to the President for National Security Affairs (APNSA) is tasked with this strategy, in coordination with the Assistant to the President for Economic Policy, to be delivered within 90 days.  Within 240 days, the APNSA “shall review all national preparedness and response policies and recommend to the President the revisions, recissions, and replacements necessary to reformulate the process and metrics for Federal responsibility, move away from an all-hazards approach, and implement the National Resilience Strategy.”

In March, to gain feedback for the Review Council, the House Homeland Security Committee’s Subcommittee on Emergency Management and Technology held a hearing entitled “Future of FEMA: Perspectives from the Emergency Management Community.”  Witnesses included Jeff Smitherman, Director, Alabama Emergency Management Agency; Daniel Kaniewski, Ph.D., Managing Director of the Public Sector, Marsh McLennan; Carrie Speranza, CEM, President, U.S. Council of the International Association of Emergency Managers; and Timothy Manning, Former Deputy Administrator for Protection and National Preparedness, FEMA.  In his testimony, Daniel Kaniewski – who also testified alongside Michael Hecht in a January 2024 Senate Banking Committee hearing – wrote that, “The public and private flood insurance markets could be improved through strengthening and protecting the NFIP, growing the private flood insurance market, addressing gaps in coverage, embracing innovations such as parametric insurance, and more.”  He elaborated, “To address affordability concerns associated with the new risk-adjusted rates, Congress could consider authorizing targeted assistance, such as a means-tested assistance program.”

Meanwhile, FEMA announced that it is ending the Building Resilient Infrastructure and Communities (BRIC) program and canceling all BRIC applications from Fiscal Years 2020-2023.  The BRIC program was designed for states, local, territorial governments, and Tribal Nations to reduce their hazard risk through community projects that alleviate human suffering and avoid economic losses from floods, wildfires, earthquakes and other disasters.  In FY23, FEMA received 1,233 BRIC subapplications across all 50 states, 35 Tribal Nations, and five territories.  Applicants requested more than $5.6B, from the $1B made available.  Over 28 subapplications to address flood damage were selected, totaling $395M.

Bloomberg reporter Leslie Kauffman, who has previously collaborated on stories with CSFI, wrote a piece on “What FEMA’s Demise Could Mean for Flood Insurance.”  Kauffman writes, “If FEMA is eliminated — something President Donald Trump has also called for — another agency could take over NFIP’s insurance policies and payouts.  But while the program provides insurance services, the rest of FEMA provides critical information that stabilizes the market such as the location of flood zones and flood mitigation efforts.”  Kauffman also notes that “Closing NFIP would have far-reaching effects on the entire financial system” and that “FEMA’s flood insurance requirements have helped drive building code and zoning ordinance changes that reduce the risk of flood damages.”