Community Disaster Loans

 

To provide loans subject to congressional loan authority to any local government that has suffered substantial loss of revenues in an area designated in a Stafford Act major disaster declaration in order to assist communities affected by an incident to perform its governmental functions. The local government must demonstrate a need for financial assistance and the funds can only be used to maintain existing functions of a municipal operating character or expand functions to meet disaster-related needs.

Active 97.030 Federal Emergency Management Agency, Department of Homeland Security B - Project Grants; E - Direct Loans Not applicable. Public Law -, Robert T. Stafford Disaster Relief and Emergency Assistance Act, as amended, Section 417, 42 U.S.C. 5184 U.S.C. Local (includes state-designated Indian tribes and U.S. territories, excludes institutions of higher education and some hospitals) government applicants must be in a designated major disaster area and must demonstrate that they meet the specific conditions of 44 C.F.R. Part 206, Subpart K, Community Disaster Loans. To be eligible, the applicant must demonstrate: 1) a substantial loss of revenues as a result of a major disaster; 2) a need for financial assistance to perform its governmental functions. During the 2017 hurricane season, a supplemental provided funding and new guidance specific to Hurricanes Harvey, Irma, and Maria. Public Law 115-72 and Public Law 115-123 provide additional supplemental appropriations and eligibility criteria for disaster relief requirements for the fiscal year ending September 30, 2018. Further, P.L. 116-260 removed the loan cap, provided alternate eligibility criteria, and extended the deadline for FEMA to issue a loan only for those disasters that were declared in calendar year 2018. P.L. 117-43, signed on September 30, 2021, cancelled the repayment of balances outstanding on all loans as of September 30, 2021. Local governments in a designated disaster area. The CDL application is developed from financial information contained in the local government's published financial reports and current annual operating budget. Loan awards will be determined in accordance with 2 C.F.R. Part 200 and 44 C.F.R. Part 206, Subpart K. Preapplication coordination is required. An environmental impact statement is required for this listing. An environmental impact assessment is required for this listing. This program is eligible for coverage under E.O. 12372, "Intergovernmental Review of Federal Programs." An applicant should consult the office or official designated as the single point of contact in his or her State for more information on the process the State requires to be followed in applying for assistance, if the State has selected the program for review. Preapplication coordination is required. 2 CFR 200, Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards applies to this program. Upon declaration of a major disaster, an application for a Community Disaster Loan is made through the Governor's Authorized Representative to the FEMA Regional Administrator in accordance with 44 C.F.R. ?206.364. The Assistant Administrator for the Recovery Directorate or designee approves or disapproves the loan. The Designated Loan Officer will execute a Promissory Note with the applicant. The Promissory Note must be co-signed by the state, or if the state cannot legally co-sign the note, the local government must pledge collateral security. Funds are disbursed to the local government when requested in accordance with the, or submittal of the Disbursement Request Form. All borrowers must follow requirements of 2 C.F.R. Part 200. The Assistant Administrator for the Recovery Directorate may approve a loan in either the fiscal year in which the disaster occurred or the fiscal year immediately following that year. From 1 to 6 months. The loan must be approved in the fiscal year of the disaster or the fiscal year immediately following. If a loan application is disapproved, in whole or in part, a revised application may be resubmitted by the local government within 60 days of the date of the disapproval. The term of the loan is 5 years, unless otherwise extended by the Assistant Administrator for the Recovery Directorate. The Assistant Administrator for the Recovery Directorate may extend the loan for an additional 5-year term without any changes to the interest rate based on the local government's financial condition. Interest will continue to accrue until loan is paid back. Applicants must demonstrate a greater than 5% revenue loss in the fiscal year in which the major disaster took place, or in the fiscal year immediately following the fiscal year of the major disaster event. Loans are made only to local governments or other political subdivisions of the state/tribe/territory and are based on need. The funds cannot be used to meet the non-federal share of any federal program, debt service, finance capital improvements, or repair or restore public facilities. Applicants must be in a designated major disaster area and –unless specified differently through a particular public law—must demonstrate that they meet the specific conditions of FEMA Emergency Management and Assistance Regulations at 44 C.F.R. Part 206, Subpart K, Community Disaster Loans. To be eligible, the applicant must demonstrate: 1) a substantial loss of revenues as a result of a major disaster; and 2) a need for financial assistance to perform its governmental functions. For traditional CDLs, the amount of the loan is based on the demonstrated need and shall not exceed 25% of the applicant’s Operating Budget expenditures, up to $5 million. The interest rate is the U.S. Treasury rate for 5-year maturities on the date the Promissory Note is executed, adjusted to the nearest 1/8th. The term of the loan is 5 years for traditional loans but may be extended. Interest accrues on the funds as they are disbursed. When applicable, the Assistant Administrator of the Recovery Directorate may cancel repayment of all or part of the traditional loan if the revenues of the applicant in the 3 fiscal years following the disaster are insufficient to meet the operating budget because of disaster-related revenue losses and un-reimbursed disaster related operating expenses. Performance Reports: Refer to program guidance https://www.fema.gov/assistance/public/community-disaster-loan In accordance with the provisions of 2 C.F.R. Part 200, Subpart F - Audit Requirements, nonfederal entities that expend financial assistance of $750,000 or more in Federal awards will have a single or a program-specific audit conducted for that year. Non-Federal entities that expend less than $750,000 a year in Federal awards are exempt from Federal audit requirements for that year, except as noted in 2 C.F.R. ? 200.503 These audits are due to the cognizant federal agency, submitted through the Federal Audit Clearinghouse, not later than 9 months after the end of the audit period. Annual Operating Budgets including revenue and expense and balance sheets general ledgers must be retained for the duration of the loan. Additional record requirements are detailed in the FEMA Emergency Management and Assistance Regulations at 44 C.F.R. Part 206, Subpart K. Statutory formula is not applicable to this assistance listing.

Matching requirements are not applicable to this assistance listing.

MOE requirements are not applicable to this assistance listing. Funds are provided by FEMA to applicants by using the Department of Health and Human Services’ (HHS) Payment Management System (PMS). Disbursements are requested by the applicant from the PMS to the established local government’s bank account for the loan and must be drawn and spent by the end of the 3rd year post-disaster. Method of awarding/releasing assistance: Payment based on projected need. Payment based on Project need. See Appendix IV of the Catalog for a listing of addresses for FEMA's Regional Offices. Martha M. Castro
500 C Street, SW Mail Stop #3163,
Washington, DC 20472 USA
Martha.Castro@fema.dhs.gov
Phone: (202) 701-4023 https://www.fema.gov/media-library/assets/documents/176527 70-0703-0-1-453 (Project Grants) FY 22$11,725,642.00; FY 23 est $15,673,000.00; FY 24 est $110,865,138.00; FY 21$151,403,452.00; - Loans issued to-date during FEMA's fiscal years 2022 and 2023 range between $673,336 to $5 million, averaging $3,557,778.67 Not applicable. Not applicable.