The Disaster Formula

DHS funding takes a risk-based approach

The 9/11 Commission questioned Department of Homeland Security-allocated state and local homeland security assistance in August 2004, arguing that federal homeland security aid should not remain a program for general revenue sharing. The commission went on to state that federal State Homeland Security Grant Program (SHSGP) funds “should supplement state and local resources based on risks and vulnerabilities that merit additional support.”

While debate has ensued on this recommendation, certain program funds have been distributed according to the formula set out in the 2001 Patriot Act that guarantees each state a minimum of 0.75 percent of total appropriations for domestic preparedness programs. The problem with this approach is obvious when one considers that this formula allowed Wyoming to get about $37.94 per capita in 2007, while California—with both more people and much higher risk— received about $5 per capita in DHS grants. In addition to the baseline amount, the remaining SHSGP funds were allocated based on risk and the effectiveness of the applicants’ proposed solutions to address identified needs.

The Bush administration requested that fiscal 2008 funds for only the Emergency Management Performance Grants and Citizen Corps programs be distributed pursuant to the Patriot Act’s 0.75-percent formula. Additionally, the administration proposed that the SHSGP be classified a discretionary program but guaranteed that each state with an approved homeland security plan will get a minimum of 0.25 percent of total appropriations. After years of haggling, Congress accepted a compromise distribution formula of 0.375 percent for 2008 that reduces to 0.35 percent over five years and included it in legislation enacted last August. For certain high-risk states—like New York and California— the minimum grant will be 0.45 percent.

“The department is investing federal funding into our communities facing the greatest risk and demonstrating the greatest need in order to receive the highest return in our nation’s security,” Homeland Security Secretary Michael Chertoff said in press reports. “Our nation’s preparedness and the support of our emergency responders on the front lines of the war against terrorism must be a shared effort. We will continue to champion funding on the basis of risk and need, and we urge Congress to do the same to ensure that our finite resources are allocated and prioritized successfully.”

Jackson County, Ore., emergency management director and career firefighter Mike Curry thinks this is one time DHS got it right.

“Even though we’ve lost funding under the new formula, the grants are going to where the threats are,” Curry said. “My main concern remains that we retain a baseline level of funding to support our communications interoperability project. California, New York and Washington, D.C., are rightfully the priority, but we have needs, as well. While not perfect, this is a better approach.

“We need balance and must remain ever vigilant, even in the low-threat regions of this country; our greatest vulnerability will be to put all our eggs in one basket by protecting the most obvious terrorist targets while we ignore the least likely.”

All eligible applicants must submit an investment justification that identifies needs and outlines the intended security enhancement plan to meet the target capabilities outlined in the national preparedness goal. Investment justifications will be reviewed, scored and prioritized along with risk factors to determine which investments should be funded to best address need and minimize risk. Factors like the presence of international borders, population and population density, the location of critical infrastructure, formal mutual aid cooperation, law enforcement investigations and enforcement activity are considered in correlation with the risk formula for grant determinations.

There is a direct and practical effect of changing the grant formula. The likely, but not necessarily certain, targets of future terrorism will get a larger share of federal grant funding, while the hardest hit will be states at less risk for terrorism. As logical as this grant distribution appears, it is not without its shortcomings. As with any program, the devil is in the details.

The fundamental problem with a risk-based approach is that not all disasters are manmade. Hurricane Katrina demonstrated that fact conclusively. On the other hand, it is doubtful that Oklahoma City would have made anyone’s list of high-risk metropolitan targets prior to 1995.

If Hurricane Katrina, the bombing of the Murrah Federal Office Building and the terrorist attacks of Sept. 11, 2001, are the most-deadly disasters in recent U.S. history, changing the SHSGP funding formula to a risk- and vulnerabilities-based program weighted toward terrorism means we get it right one out of three times. That average is unacceptable for homeland security funding.

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