The Florida Panhandle’s recovery after Hurricane Michael in 2018 has been nothing short of extraordinary — and costly. After the Category 5 storm swept across northwest Florida, cities were left with millions of yards of debris, loss of homes and businesses, and damaged infrastructure. Local governments had to act quickly to assist residents and restore critical services such as water, power and sewage treatment. To do so, many communities such as Panama City were forced to hastily acquire loans to cover costs and jumpstart recovery efforts.
This quick response has paid off with businesses returning, new homes under construction and infrastructure repairs underway ahead of schedule. However, this recovery comes at a great cost, as local governments now face millions of dollars in interest payments while awaiting potential reimbursement from the Federal Emergency Management Agency (FEMA). But there is good news — a solution rests within the Senate now that the House has passed H.R. 5689, the Resilient AMERICA Act.
In the days immediately following Hurricane Michael, local governments first ensured resident safety and then took stock of the damage. It was vast. In Panama City alone, 90 percent of structures were damaged and more than a million trees were uprooted, leaving behind 5.7 million cubic yards of debris, or enough to fill the Empire State Building more than three times over.
City officials didn’t delay, securing a $75 million line of credit to immediately begin work clearing the debris. Within nine months, the city secured an additional $80 million loan to pay for emergency expenses. Yet, even as this aid accelerated recovery, interest payments and other debt service fees also accumulated.
Too often, local governments must shoulder the financial burden of emergency disaster response and await FEMA reimbursement. For Panama City, interest and other debt-service costs related to its recovery are projected to cost the city millions of dollars by the final payment. Covering these steep financing costs has diverted taxpayer money away from projects that can improve quality of life or reduce property tax levies. Instead, these funds have been invested in substantial recovery efforts, such as improvements to the city’s infrastructure, safety and security.
Easing the financial stress placed on smaller municipalities in the wake of emergency disasters will not only improve preparedness and response — it will quickly restore economic growth and vital repairs. And there’s little time to waste.
This summer, extreme weather events such as hurricanes, droughts and wildfires are expected to reach dangerous levels again. Expert forecasters predict 2022 to be an “above-average” hurricane season, with more than 20 storms expected to land on American shores. For Panhandle cities still working to return to normal after Hurricanes Michael and Sally and the COVID pandemic, another major storm could wipe away all progress.
In April, the House passed H.R. 5689 to bolster disaster resilience and improve hazard mitigation. The Resilient AMERICA Act includes language from a bill that was introduced by Rep. Neal Dunn (R-Fla.), a Panama City resident — the FEMA Loan Interest Payment Relief Act — which would require FEMA to reimburse municipalities for interest incurred on loans used for essential recovery efforts from natural disasters, including Hurricane Michael and others that occurred in 2018. This critical legislation would alleviate the burden on local governments and allow them to invest those resources on strengthening their emergency preparedness and expediting ongoing recovery projects.
For Panama City, this bill gives power to purchase fire response vehicles, make improvements to parks and roadways, and repair damaged water and sewer systems. And the cost-benefits extend far beyond Panama City lines. In 2021, hurricane and other extreme weather-related costs totaled $145 billion. For cities across the nation, H.R 5689 would greatly offset the burdensome costs of interest expense and liberate local taxpayer dollars to be better used to rebuild communities.
With mere months left before the midterm elections and the end of the legislative year, the Senate’s window to act is closing. It’s time for senators to take action, approve H.R. 5689 and give Americans the hope that no matter what storms may come, they will be resilient and ready.
Greg Brudnicki is the mayor of Panama City, Fla.