FEMA Loan Interest Payment Relief Act

This bill would let FEMA pay back the interest costs that local governments and electric cooperatives rack up when they take out loans to cover disaster recovery while waiting for federal help. It directs FEMA to reimburse “qualifying” interest tied to disaster projects under the Stafford Act. It also says only money Congress provides after the bill becomes law can be used for these payments.

It reaches back to cover interest from the past nine years, so communities aren’t left with old loan interest from recent disasters. FEMA must also post a simple process within 30 days for states to request payback on pending projects, give states 60 days to apply, and finish paying within a year.

• Who is affected: Local governments (including D.C.) and electric cooperatives; states seeking reimbursement on pending projects .
• What changes: FEMA can reimburse eligible loan interest tied to disaster recovery; only newly appropriated funds can be used.
• When: Covers interest from the 9 years before the law takes effect; FEMA must set up the process within 30 days, states have 60 days to apply, and FEMA must pay within 1 year.