Exploring the Landscape of Disaster Recovery Funding

The rapid succession of hurricanes Irma and Maria in 2017 were devastating for the USVI. Collectively, the storms caused widespread power outages, flooding, storm surge, and infrastructure damage. The damages were profound and long lasting— estimated at over $10.76 billion in total, including sustained damages to 52% of the housing stock, 12% of which was severely damaged.60 The storms also hit during a time of significant budgetary strain for the territory with a total of $5.4 billion in public debt and unfunded obligations. These conditions coupled with the territory’s isolated geography, positioned it for a challenging recovery.

Like the storms, the recovery response has been substantial, with USVI anticipating as of October 2022 a total of $10 billion in federal recovery funding over the next 5–8 years. While the recovery response has been considerable, it has struggled with implementation challenges and delays, requiring the extension of some programs’ time horizons and, recently, the announcement of an audit by HUD on the administration of CDBG –Disaster Recovery funds.

This report explores the governmental entities, programs, and data being used to support USVI’s recovery from the 2017 hurricanes. As a highly complicated bureaucratic process, this work is intended to bring clarity to the funding process and shed some light on the dynamics impacting the current state of recovery funding in USVI.

We focused our approach around three central questions:

• Who are the primary federal funders and programs active in USVI?

• What does the delivery of these programs look like?

• What’s the current state of funding in 2022?

With these questions as our research basis, we have structured the following report with a summary of our research process followed by our main observations from our exploration of the federal recovery funding landscape and concluding with four central themes and a related recommendation for future work supporting the efficacy and equity in the allocation and expenditure of federal recovery dollars.

Step 1 Step 2 Step 3

amount of money available to a federal agency for a specific purpose once funding has been allocated for a given purpose, an agency can incur an obligation—a legally binding commitment

Summary of Process

In framing our approach to this subject, we wanted to acknowledge the plethora of existing research on recovery and funding in USVI as well as recovery plans already made for the territory. Namely, the St. Croix Community Recovery Plan (2018), and Recovery in the U.S. Virgin Islands, otherwise known as the RAND Report (2019), were essential guides for our work and revealing foils to one and another (which we explore in more detail later). In addition to existing territory-level recovery and planning reports, we started our research by looking at major repositories of funding and government spending data. These two resources including USAspending.gov, which is a database of all transactions since 2008 by the US government, and the Office of Disaster Recovery (ODR), which was established in 2019 by the Territory to streamline the recovery funding when a federal agency liquidates an obligation process as the central coordinating and tracking entity of all recovery dollars coming into USVI.

We also analyzed some recovery programs active in the USVI. These included the Department of Housing and Urban Development’s (HUD) Community Development Block Grants Disaster Recovery (CDBG-DR) program and the Federal Emergency Management Agency’s (FEMA) Program Assistance (PA) recovery program. Given the recent HUD audit announcement and that it is one of the least expended funding sources thus far in recovery (22.4% expended), we particularly centered the CDBG-DR program for much of our programmatic analysis using it as example of potential challenges slowing or impeding the expenditure of recovery funds.