With funding set to run out Saturday, the Federal Emergency Management Agency may be forced to delay reimbursements to states and local governments struggling to recover from natural disasters.
That was the warning from Gregg Phillips, the associate administrator for FEMA's Office of Response and Recovery, who testified Wednesday before House lawmakers on the impact of an appropriations lapse facing the Department of Homeland Security this weekend. FEMA is housed in the DHS budget.
FEMA's Disaster Relief Fund, the agency's main federal assistance fund for local relief, has sufficient balances to continue emergency responses actions "for the foreseeable future," Phillips said. But he warned the fund would be "seriously strained" by a catastrophic disaster. The fund had about $26 billion
"Make no mistake that our ability to process any payments under the DRF is going to be diminished when, if there is a lapse," Phillips said.
"A government shutdown would severely disrupt FEMA's ability to reimburse states for disaster relief costs and to support recovery from disasters," Phillips said. "Delays in deploying financial assistance to affected communities could hinder timely disaster recovery efforts. States and communities will be forced to wait for long-term response work to continue."
FEMA plays a key role for local governments and states recovering from natural disasters, and the federal funds and response time can affect the credit ratings of municipalities struggling to recover.
The number of natural disasters costing more than $1 billion rose to 23 annually from 2020 to 2024 from seven per year from 1980 to 2019,
A DHS shutdown would limit FEMA's ability to coordinate with local and state governments, disrupt long-term planning for the next hurricane and wildfire seasons, and undermine public confidence in the federal disaster response process, Phillips warned.
House Appropriations Committee ranking member Rep. Rosa DeLauro, D-Conn., questioned Phillips about the Trump administration's
"Is that number accurate?" she asked. "We need to know."
"In the 45 days I've been here, we have spent $3 billion on 5,000 projects," Phillips responded. "We're going as fast as we can. And if this [appropriations] lapses, that's going to stop."
Congress has passed all fiscal 2026 appropriations except for DHS, which has been mired in controversy since the January fatal shootings of American citizens by immigration and enforcement officers.
Lawmakers left town Thursday for a 10-day break without reaching agreement on DHS appropriations, although talks may continue through the weekend. Funding for the department, which includes FEMA, the Transportation Security Administration and the Secret Service, runs out at midnight Friday.
The bulk of immigration enforcement operations — the most controversial part of the budget — will remain on track as last year's One Big Beautiful Bill Act allocated $75 billion to support operations.
