TL;DR: The May 7, 2026 FEMA Review Council report proposes keeping FEMA but shifting costs and decisions to states, with fewer declarations, faster formula-based payments, and smaller household aid — all still proposals requiring Congress to change the Stafford Act.

The new FEMA plan would hit communities through three channels: money, speed, and survivors. According to Texas Appleseed, the Federal Emergency Management Agency Review Council released its Final Report on Thursday, May 7, after 17 months of outreach and debate. According to the Bipartisan Policy Center, the report offers 10 recommendations to significantly reorient FEMA's role and shift greater disaster response and recovery responsibility to states and localities. The Council recommended keeping FEMA intact at the federal level while passing more responsibilities to states, nonprofits, and individuals, according to Texas Appleseed.

If enacted, the plan would reduce the number of disasters that qualify for federal assistance, lower the percentage of costs that the federal government would cover, and eliminate key functions that the federal government has previously performed, according to Texas Appleseed. None of these changes are certain, according to Texas Appleseed. Enacting many of these recommendations would require congressional action to amend the Stafford Act, the primary law governing federal disaster response and FEMA programs, according to Texas Appleseed. Page 15 of the report notes that seven of the ten recommendations require legislation or changes to regulations to implement, according to emergency manager Lucien Canton in an analysis titled The FEMA Review Council Report: Does It Really Change Anything?

The context: a strained agency heading into hurricane season

The report arrives while FEMA is managing more than 300,000 projects across more than 600 open disaster declarations with a smaller staff, having absorbed an approximately 14% workforce reduction since January 2025, according to the Bipartisan Policy Center. In Executive Order 14180 in January 2025, President Donald Trump established the FEMA Review Council, according to the Bipartisan Policy Center. When President Trump established the review council, he signaled a desire to disband the agency and shift its responsibilities to state, local, tribal, and territorial entities, according to the Bipartisan Policy Center.

A record 76-day Department of Homeland Security shutdown cut off FEMA's annual appropriations until passage of the Fiscal Year 2026 DHS Appropriations Act on April 30, 2026, according to the Bipartisan Policy Center. Although the DHS appropriations bill replenishes FEMA's Disaster Relief Fund with $26.4 billion and rejects further staffing cuts, Secretary Markwayne Mullin estimated the shutdown's operational damage will take months to address, according to the Bipartisan Policy Center. The Bipartisan Policy Center assessment cited a depleted workforce, a Disaster Relief Fund drained to emergency levels in April, and a Government Accountability Office High Risk List designation. Hurricane season begins June 1, according to the Bipartisan Policy Center.

Leadership has also changed. Former Sen. Markwayne Mullin replaced Kristi Noem as DHS secretary in late March 2026, and he revoked a requirement under Noem that the DHS secretary personally approve expenditures over $100,000, according to the Bipartisan Policy Center. President Trump has nominated Cameron Hamilton to be FEMA administrator after Hamilton was dismissed from his position as acting FEMA administrator in May 2025 for defending the agency in congressional testimony, according to the Bipartisan Policy Center.

Money: fewer declarations and a higher bar for aid

Under the current framework, state, local, territorial, and tribal governments are primarily responsible for disaster response and recovery, according to Texas Appleseed. FEMA is not involved unless the governor has asked for a federal declaration and the President has approved one, according to Texas Appleseed. The governor's request must be based on a finding that the disaster is of such severity and magnitude that effective response is beyond state and local capabilities under Stafford Act 42 USC 5170, according to Texas Appleseed.

The President has discretion to grant or deny a declaration, usually based on a FEMA recommendation that uses measurable damage indicators to determine whether a threshold is met, according to Texas Appleseed. The Council's overall recommendation is that there should be fewer federal disaster declarations and that states, territories, and tribes should take on increased responsibility, according to Texas Appleseed. For example, the Council recommended increasing the statewide Public Assistance per capita indicator from $1.94 to $2.99, according to Texas Appleseed.

In plain terms, this would raise the minimum financial threshold of damage a state, territory, or tribe must sustain before qualifying for federal aid, according to Texas Appleseed. By the Council's own calculations, if this higher indicator had been applied between 2012 and 2025, there would have been 29% fewer federal disaster declarations, according to Texas Appleseed. The report also recommends that FEMA impose a minimum annual amount that states have to spend before they can request a declaration, based on the state's size, but the report does not include further information on how this disaster deductible would work, according to Texas Appleseed.

The backdrop is a long rise in declaration counts. In the 1950s, the U.S. had around 20 disaster declarations per year, and by 2024 total disaster declarations had increased to 108, according to Lucien Canton. The report recommends reducing the incentive for governors to request declarations rather than invest in preparedness by realigning criteria for federal relief, specifically the per capita indicator, according to Lucien Canton.

Why a higher threshold matters for households

The Council does not provide a plan for how states would shoulder additional costs of responding to more disasters, according to Texas Appleseed. Disasters that do not meet the federal threshold already challenge local elected officials and emergency managers, and individual families in particular, according to Texas Appleseed. Most states, including Texas, do not have disaster recovery programs that provide help to individual survivors with home repairs, rebuilding, or other disaster-caused needs, according to Texas Appleseed.

State budget surpluses, often referred to as Rainy Day Funds, vary widely, according to Texas Appleseed. Texas has roughly 3 times the population of North Carolina and more than 7.5 times the budget surplus, according to the Pew Charitable Trusts as cited by Texas Appleseed. The average state Rainy Day Fund decreased in FY2025 for the first time in almost two decades, according to Texas Appleseed. With state resources shrinking, more survivors and local communities could find themselves completely unsupported if the federal declaration threshold is raised, according to Texas Appleseed.

The report recommends making formal changes to declaration thresholds through regulation, and it also reminds the President that he has discretion to order that only requests above a higher threshold be considered, according to Texas Appleseed. FEMA told The New York Times that it had already adjusted the damage threshold for inflation over a week before the Council's report was released, according to Texas Appleseed. The President ultimately has discretion over granting or denying federal declarations regardless of FEMA's recommendation, according to Texas Appleseed.

Speed: direct funding within 30 days through RAPID

The Council proposes the Reformed and Partnered Initiative for Disasters (RAPID) program, a framework that converts the existing Public Assistance program into a direct funding model that leverages pre-defined objective event criteria and cost estimates, according to The Readiness Lab. Public Assistance is FEMA's largest grant program providing funds to assist communities responding to and recovering from major disasters declared by the President, according to The Readiness Lab.

Utilizing a parametric trigger, funding would be released to states within 30 days of a major federal disaster declaration, according to The Readiness Lab. This eliminates the need for time-consuming loss assessments and quickly provides a financial backstop and cashflow for rapid response and recovery, according to The Readiness Lab. When paired with traditional insurance of public facilities, this can enable communities to quickly recover with manageable financial risk and burden to local taxpayers, according to The Readiness Lab.

For public assistance the report recommends eliminating loss assessments and using a parametric trigger where if an event reaches a pre-defined threshold, it automatically sets the immediate payment amount based on the magnitude of the event, according to Lucien Canton. The current Public Assistance process is burdened by bureaucracy, leading to significant delays and frustration from states and communities, according to The Readiness Lab. While FEMA programs are considered a bureaucratic maze, according to the Bipartisan Policy Center, the House Transportation and Infrastructure Committee reported comprehensive reform legislation — H.R. 4669, the Fixing Emergency Management for Americans Act — in September 2025 after a bipartisan vote of 57-3, although the bill has not advanced in the House, according to the Bipartisan Policy Center.

Survivors: one direct payment and a narrower housing promise

The Council recommends dramatic changes to the Individual Assistance program that would reduce the number of households that receive assistance, according to Texas Appleseed. The Individual Assistance program would replace multiple programs with a single direct payment to survivors while transferring responsibility for immediate sheltering to state, local, and tribal governments, according to Lucien Canton. FEMA would focus on temporary housing but only for Americans whose homes are uninhabitable, according to Lucien Canton.

The report also recommends homeowner assistance be based at no more than 15% of the local government's assessed value, capped at $150,000, according to Lucien Canton. The Council's mantra is Locally executed, state managed, federally supported, according to Lucien Canton. The council described state and local governments as the frontline in recovery efforts and said federal assistance should be reserved for truly significant events, according to reporting by Inside Climate News carried by Central Florida Public Media.

Alan Harris, emergency manager in Seminole County, Florida, said those who turn to government agencies tend to be the most vulnerable, including senior citizens, individuals with special needs, and paycheck-to-paycheck homeowners with no place to go, according to Inside Climate News via Central Florida Public Media. Harris said if FEMA is not coming to help at the local level, the county will help to the best of its ability, but with no funding he does not know what that will look like, according to Inside Climate News via Central Florida Public Media.

What is still being paid out right now

On May 22, FEMA announced the approval of $175 million in post-disaster funding for Public Assistance and Hazard Mitigation Grant Program projects across the U.S., according to the FEMA Bulletin Week of May 26, 2026. The funding includes $157 million under FEMA's Public Assistance program awarded across 41 states, the District of Columbia and Puerto Rico for more than 400 recovery projects, including 240 COVID-19 projects for more than $91 million, according to the FEMA Bulletin Week of May 26, 2026. In alignment with the executive order establishing the Task Force to Eliminate Fraud, FEMA conducted thorough reviews of all claimed costs for COVID-19 Public Assistance funds to prevent fraud, waste and abuse, according to the FEMA Bulletin Week of May 26, 2026.

FEMA disburses this money to states, local, tribal and territorial communities because they are best positioned to know how these funds will be most effectively spent, according to the FEMA Bulletin Week of May 26, 2026. The funded projects include repairs to critical infrastructure, restoration of public buildings, road repairs and reimbursement for costs incurred to ensure public health and safety after a disaster, according to the FEMA Bulletin Week of May 26, 2026. In addition, FEMA is awarding more than $17 million for projects in 15 states and territories that will prevent, eliminate or reduce future disaster-related damage through the Hazard Mitigation Grant Program, according to the FEMA Bulletin Week of May 26, 2026.

Through that program, state, local, tribal or territorial governments take measures such as acquiring hazard-prone homes and businesses, adopting and enforcing building codes and standards, protecting against floods through elevations and drainage improvement projects, building safe rooms and upgrading utilities and infrastructure, according to the FEMA Bulletin Week of May 26, 2026. The report recommends eliminating the Hazard Mitigation Grant Program in favor of rapid post-disaster funding, according to Lucien Canton. FEMA said it continues its renewed commitment to help communities recover from hurricanes, severe storms, tornadoes and wildfires while making them more resilient, according to the FEMA Bulletin Week of May 26, 2026.

Readiness work already underway before June 1

Over the past several months, more than 270 Regional and National Incident Management Assistance Team personnel and 18 Federal Coordination Officers participated in Incident Management III and Incident Management II courses at the FEMA Incident Workforce Academy in Anniston, Alabama, according to the FEMA Bulletin Week of May 26, 2026. The training focused on strengthening operational coordination, decision-making, teamwork and field leadership capabilities, according to the FEMA Bulletin Week of May 26, 2026. Incident Management Assistance Teams coordinate with federal, state, local, tribal and territorial partners to support lifesaving operations and incident stabilization and set the stage to transition from response to recovery, according to the FEMA Bulletin Week of May 26, 2026.

Households can use this window to document home conditions, insurance coverage, and local shelter information issued by their state, county, or tribal emergency office. Keep copies of identification, medical needs, and repair estimates where they can be reached during an evacuation. Review how a single federal payment, state-run sheltering, and tighter declaration rules would affect a family budget if outside help arrives later or not at all.

Sources referenced