Tracking the Federal Sandy Aid Money One Year Later

Scott Gurian | October 29, 2013 | Sandy
Where did it go, and how will it help prepare us for future storms?

The Obama administration’s $60.4 billion emergency funding request to Congress last December stated that part of the money for recovery and rebuilding should be used “to help the region prepare for future challenges, including future severe storms and coastal flooding, as well as impacts associated with a changing climate.”

It also instructed that government officials at all levels should work together “to develop mutually agreed upon assessments of future risks and vulnerabilities facing the region, including extreme weather, sea level rise and coastal flooding, and incorporate these into their recovery planning and implementation.”

One year after Sandy, here’s a detailed look at where some of that money has gone, how it’s trickling down to New Jersey, and how portions of it are hopefully being used to make the state safer and more resilient to severe weather along its coast.

As indicated on the pie chart, which represents all federal aid going to all states, the $60.4 billion got reduced to just under $58 billion, as a result of the federal budget sequestration. That includes $9.7 billion in borrowing authority for the National Flood Insurance Program — to pay out federal flood insurance claims – and $48 billion that Congress allocated to the Disaster Relief Appropriations Act. That $48 billion was split between nearly two dozen federal departments and agencies, including the following:

U.S. Department of Housing and Urban Development (HUD)

The largest chunk of federal Sandy aid — some $15.2 billion — went to the U.S. Department of Housing and Urban Development (HUD) as Community Development Block Grants (CDBGs), which are being distributed locally by the NJ Department of Community Affairs (DCA). Included in this total is $2 billion specifically intended for storm mitigation-related projects.

HUD required that each of the states receiving CDBG money prepare a Disaster Recovery Plan, which details how the grantee will promote “sound, sustainable long term recovery planning informed by a post-disaster evaluation of hazard risk, especially land-use decisions that reflect responsible flood plain management and take into account possible sea level rise” and “how it will coordinate with other local and regional planning efforts to ensure consistency.”

Among the specific regulations, storm victims in flood-prone areas who apply for CDBG money to repair or rebuild their homes are required to elevate any new or substantially improved structures to at least one foot above the height requirements on the latest FEMA flood maps for their area. FEMA has acknowledged that its maps do not currently take climate change into account, so HUD’s adoption of the additional foot requirement — known as “freeboard” — is intended to provide a bit of a buffer, based on weather predictions. New Jersey has had a similar law on its books since the 2007 adoption of its Flood Hazard Control Act. The agency has indicated that it’s considering including climate change in future flood maps, but until then, it’s up to state and local governments whether to enact more stringent building requirements than those set by FEMA.

Some environmentalists and planning advocates believe that the threat of rising sea levels means one foot of freeboard isn’t enough to keep people safe over the long term. Indeed, some other states like New York and Massachusetts require two feet of freeboard, while Maryland and Delaware have imposed the two-foot rule for all state-owned structures in coastal areas.

The Association of State Floodplain Managers even goes to far as to recommend residents living in floodplains elevate three to four feet above the FEMA flood map requirements to ensure they’re protected in the coming decades. It points to a study FEMA commissioned several years ago that found the most expensive cost of elevating a building is the first foot, and that the incremental cost of raising it further is relatively small.


Here in New Jersey, state officials have responded that they’ve left the option of whether to exceed the one-foot rule up to individual homeowners, and that imposing overly stringent requirements could slow down the rebuilding process. Environmentalists disagree and argue that HUD and local elevation requirements don’t go far enough, but they say the one foot of freeboard is at least a step in the right direction.

Another HUD rule requires that if any CDBG funds are to be used for buyouts, and the purchase price is to be based on the home’s prestorm value, that property cannot be redeveloped at a later date (except for very limited circumstances) and will not be eligible for future federal disaster assistance. That’s to prevent taxpayer money from indirectly subsidizing construction in risky locations.

Beyond the freeboard and buyout requirements, HUD gives broad leeway to aid recipients to determine on their own how best to incorporate mitigation and resiliency measures on a local level.

New Jersey’s Disaster Recovery Action Plan says the state will undertake a variety of mitigation and floodplain management measures, including addressing threats imposed by sea-level rise. The plan does not specify how this will be accomplished, but DCA officials have been rolling out a number of mitigation-related grants over the past year, including the Post Sandy Planning Assistance Grant, which provides funds for counties and municipalities to hire licensed planners to “be better able to guide their rebuilding efforts to promote resilience and encourage economic growth.”

The state has also given grants to help people elevate their homes, help harden critical infrastructure like the power grid, and assist counties in developing emergency plans for future storms.

So far, there’s been little discussion of climate change in New Jersey’s recovery efforts, and the state has not adopted policies looking, for example, at predictions of climate change by 2050 or 2100, as many other coastal states in the region have. Governor Christie says his administration will focus more on storm mitigation over the next year. Environmental and planning advocates hope that means New Jersey will take the projected sea-level rise into account, so future rebuilding efforts might focus more on the long term.

Overall, New Jersey has received $1.8 billion of CDBG money so far, which it’s in the process of distributing to storm victims and municipalities via 17 grant programs. Much of the money in the programs for individuals, like the Rehabilitation, Reconstruction, Elevation and Mitigation Program (RREM) — which provides funds of up to $150,000 — is only just starting to be distributed a year after the storm. Gov. Christie blames the delay on federal bureaucratic red tape, including regulations imposed after Hurricane Katrina to ensure that disaster relief money was being well-spent. NJ Department of Community Affairs Commissioner Richard Constable has said he expects the second portion of HUD funding to come in December, but it’s unclear how much it will be.

U.S. Department of Transportation

The DOT received $12.4 billion in federal Sandy aid, including $5.5 billion for “mitigation projects to make transportation systems more resilient in the face of high winds and flooding.”

More than $2 billion is being funneled to New Jersey through the Federal Highway Administration and the Federal Transit Authority, plus $86 million that was given to Amtrak to repair and add resiliency to the Northeast Corridor rail line, which runs through the state.

According to the state comptroller’s Sandy Transparency website, the NJDOT received $925 million for emergency repairs to state highways. The Federal Highway Administration says that some of that funding may be spent on “‘betterments’ designed to mitigate flooding damage to transportation infrastructure from future storms.” Repairs to local roads were handled through the Federal Emergency Management Agency’s public assistance programs.


NJ Transit has received $1.3 billion in federal Sandy aid from the Federal Transit Authority. Portions of that money will be used to make the following long-term resiliency improvements:

  • $565 million for rail rolling-stock resiliency. Includes consideration of plans to build, buy, or lease rail yards in less flood-prone locations
  • $194.25 million for rail infrastructure resiliency. Includes making bridges, signals, and electrical substations more resilient
  • $150 million for rail station resiliency. Includes flood control for Hoboken Terminal and Secaucus Junction station and potential construction of flood walls

    $150 million for resiliency improvements at Rail Operations Center/Meadowlands Maintenance Complex in South Kearny. Includes possible construction of flood walls and berms. Although NJ Transit anticipates the yard would be evacuated during storms like Sandy, it says that it would be advantageous to harden the facility to make it possible to weather severe storms in place.

  • $30 million for Interoperational Communications Resiliency. Includes upgrading NJ Transit’s internal communications system to make it easier for critical personnel, police, and emergency responders to communicate during severe weather and disasters
  • $26.6 million for light-rail resiliency. Includes raising electrical substations, improving stormwater drainage, and installing pumps and other flood-control measures on the Newark Light Rail and the Hudson-Bergen Light Rail. Also improving the resiliency of the ferry facilities at Hoboken Terminal
  • U.S. Department of Homeland Security

    The Department of Homeland Security received $10.9 billion in federal Sandy aid, the majority of which went to FEMA, which in turn provided recovery grants to individuals as well as to local governments for public infrastructure, schools, libraries, and so forth. To date, in New Jersey, FEMA has approved more than $414 million for its Individuals and Households Program, plus more than $950 million in Public Assistance grants. The Christie administration is also using $300 million of the FEMA Hazard Mitigation Grant to acquire about 1,000 homes damaged by Sandy and another 300 that have been repeatedly flooded in the Passaic River Basin.

    In addition, the National Flood Insurance Program (NFIP) — which is run by FEMA — received a separate, $9.7 billion Congressional authorization to help pay federal flood insurance claims. The NFIP says that its maps, like FEMA’s, are meant as a baseline requirements and also do not reflect a rise in sea level.

    Army Corps of Engineers

    The Army Corps received $5 billion of federal Sandy aid. The largest chunk will go to build or repair projects “to reduce future flood risks in ways that will support long-term sustainability of the coastal ecosystem and communities and reduce the economic costs and risks associated with large-scale flood and storm events.” In New Jersey, that would entail building a line of sand dunes along all 127 miles of its coastline.

    Part of the money is also intended to “expedite and complete ongoing flood and storm damage reduction studies and to look at how to address the flood risks of vulnerable coastal populations in areas affected by Sandy.”

    An Army Corps spokesperson says its regulatory oversight for rebuilding is limited to ensuring safe nautical navigation — for example, making sure rebuilt docks don’t obstruct water traffic — and overseeing the protection of wetland areas regulated by the Clean Water Act, such as mandating that development in protected wetland areas is offset by protecting additional wetland acreage to reduce the risk of flooding.


    U.S. Department of the Interior

    The Department of the Interior received $787 million of federal Sandy aid, about half of which will be used “to expand the capacity of grants to mitigate the risk of future flooding to coastal communities by restoring and enhancing natural systems on State, local and private lands, or acquiring and converting lands that cannot be redeveloped to increase flood resiliency.” Part of the funding can also be used to mitigate the risk of future flooding and protect federal resources in national parks and wildlife refuges.

    U.S. Environmental Protection Agency

    The EPA received $577 million in federal Sandy aid. The vast majority of that will be given out as grants to states to make their drinking water and wastewater systems less vulnerable to extreme weather. The EPA is also providing $10 million in state grants to fund “wetland restoration and other ecosystem enhancements to assist in environmental mitigation of affected areas by Hurricane Sandy.”

    Small Business Administration

    The SBA received $765 million in federal Sandy aid, much of it for low-interest loans to help individuals and businesses recover. That includes $20 million “to provide technical assistance related to disaster recovery, response, and long term resiliency to small businesses that are recovering from Hurricane Sandy.”

    As far as any requirements that loan recipients repair or rebuild in a way that’s less vulnerable to future storms, an SBA spokesperson says that the Small Business Administration simply requires that disaster loan recipients follow local building codes, “which generally requires them to adhere to the new elevation standards.” Loan recipients are also required to obtain flood insurance coverage.

    U.S. Department of Commerce

    The Department of Commerce received $310 million of federal Sandy aid. The majority of that money is going to the National Oceanic and Atmospheric Administration (NOAA), which will provide technical assistance to “improve preparedness and resiliency in coastal communities, improve forecast and modeling capabilities to support mitigation efforts, and stabilize and restore ecosystems.” Some of the funding will also be used “to support State and local acquisition of land to restore and build coastal resiliency in areas where rebuilding physical infrastructure is not feasible or desirable, and on activities that can increase the protective capacity of natural ecosystems, such as restoring wetlands, to benefit adjacent coastal communities.” Buyouts would be awarded through the Coastal and Estuarine Land Conservation Program.

    U.S. Department of Agriculture

    The Department of Agriculture received just over $217 million, $150 million of which is “available for the purchase of floodplain easements in flooded or flood-prone coastal areas in order to mitigate economic and environmental risks of future flood events.”

    Smaller amounts of Sandy aid money were split between 10 other federal departments, but those funds were more focused on repairing storm damage than preparing for future storms.

    Gov. Christie said last May that he expects a total of $20 billion to 25 billion to ultimately make it to New Jersey, which would cover just over half of the state’s estimated $37 billion in losses. As of last Friday, the state had received a total of $5.67 billion — including $3.5 billion in federal flood insurance payouts — plus $1.8 billion in CDBG funding (though much of that money has not yet been paid out). That means that a year in, New Jersey storm victims have essentially received only about a quarter to a third of what they should expect to receive at the end of the day.