FEMA, U.S. Virgin Islands Assess Using Alternative Assistance Procedures

The U.S. Virgin Islands may be comparatively small in size, but its disaster recovery efforts have currently captured the attention of the Federal Emergency Management Agency (FEMA) and the Government Accountability Office (GAO).

In September 2017, two major hurricanes (Irma and Maria) hit the U.S. Virgin Islands, causing billions of dollars in damage to its infrastructure, housing and economy. To assist in the recovery, FEMA provided more than $1.4 billion in grant funding to the territory, as of Oct. 1, 2018, though the Public Assistance program, which helps fund debris removal, emergency protective measures and the repair, replacement or restoration of public infrastructure.

FEMA and the U.S. Virgin Islands now are transitioning from using the standard Public Assistance program, where FEMA will fund the actual costs of a recovery project in the territory, to using the Public Assistance alternative procedures program, in which awards are made on a fixed-cost estimate, thus offering financial incentives for the timely and cost-effective completion of work projects. Using this method, the U.S. Virgin Islands will have more flexibility in determining when and how to fund projects. For example, the territory would be able to consolidate permanent work projects approved under the alternative procedures and share obligated funding across these projects. Further, the alternative procedures can enable it to use any excess funds for hazard mitigation or other activities to help prepare for future Public Assistance efforts.

A recent GAO report noted that as of November 2018, FEMA and U.S. Virgin Island officials were discussing the process for developing projects under these alternative procedures. GAO stressed that given the territory’s “difficult fiscal situation, … ensuring these fixed-cost estimates are as accurate as possible will be critical.” Should this transition effort not prove feasible, FEMA has explained that the territory may still move forward though the standard Public Assistance program.

All cost estimates for projects under this alternative procedures arrangement must be finalized by March 2020. GAO stated that it will continue the monitor the plans developed by the U.S. Virgin Islands for using the alternative procedures as part of GAO’s broader assessment of recovery efforts in the territory and will address these developments in a report later this year. Opportunities that can provide grantees with funding flexibility, particularly in trying times, can be welcome indeed. It will be interesting to see if the alternative procedures method proves viable for the U.S. Virgin Islands.

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