state and local

FEMA Denies More State Disaster Requests With 21,000 Staff and a Surge Force of 240, as States Absorb the Cost

On 8 October FEMA turned down Illinois’s request for federal help with damage from storms in August, across eight counties. Administrator Cameron Hamilton said aid was “not warranted.” The state is appealing, and Darin LaHood, a Republican congressman from the area, objected.

It’s the latest in a run of denials that has shifted disaster costs to states. In July FEMA denied requests from New Jersey, New York, Massachusetts and Rhode Island for a winter blizzard, together worth about $227 million. All four have appealed.

A smaller agency

GAO reported in August that FEMA’s staff fell from an average of 25,134 in fiscal 2025 to about 20,968 in April 2026. Only 134 people were hired between October 2025 and mid-May 2026. The Surge Capacity Force, federal employees from other agencies who deploy after big disasters, fell from about 600 available to about 240 for this hurricane season. FEMA had 1,079 open disaster declarations in June.

A December 2025 staffing plan proposed cutting FEMA to 11,383 employees, about half. FEMA’s own offices had recommended about 23,000. The hiring freeze was partly lifted in May.

The Review Council’s plan

In May the FEMA Review Council, co-chaired by the Homeland Security Secretary, published its final report. It proposed:

  • turning Public Assistance, which rebuilds public infrastructure, into a block grant paid within 30 days;
  • replacing individual aid with a single payment of up to $150,000 for homeowners;
  • higher damage thresholds per resident plus minimum state spending, which would mean about 16 fewer major disaster declarations a year;
  • handing sheltering to states.

The final report dropped the leaked draft’s 50% staff cut and took no position on whether FEMA should stay in DHS.

None of it needs Congress to start shaping decisions. Seventeen senators wrote to OMB in June citing reporting that requests from Democratic-led states had been approved 23% of the time against 89% for Republican-led states, with longer waits. They said nine requests that met FEMA’s own per-capita threshold had been denied since April 2025. FEMA says each request is judged on whether the state can handle the damage itself.

Money

During the 11-week DHS shutdown earlier this year, the Disaster Relief Fund fell to about $1.6 billion and FEMA restricted spending to immediate needs. Congress then provided $26.4 billion when it ended the shutdown in April.

The resilience grant programme BRIC, which FEMA cancelled in April 2025, is back under court order. A federal judge in Massachusetts ruled the cancellation unlawful, and in March 2026 FEMA reopened applications for up to $1 billion.

The state budget angle

For states, each denial means paying for debris removal, road repair and emergency staff out of their own budgets. That comes as state spending is flat and rainy-day funds are falling, as covered in our state budgets post.

Hamilton, confirmed in August as FEMA’s first Senate-confirmed head of this administration, told senators he opposed quadrupling the damage threshold. Congress has a bill of its own, the FEMA Act, which would make FEMA an independent cabinet-level agency with a sliding federal cost share of 65% to 85%. It cleared committee 57 to 3 in 2025 and hasn’t had a floor vote. Until it does, the shift to states is happening one denial at a time.