FEMA Review Council Calls for States to Lead Disaster Recovery, Privatize Flood Insurance
Why It Matters
A Trump-appointed federal panel is recommending a fundamental restructuring of how the United States responds to natural disasters — shifting primary responsibility from Washington to state capitals and moving the federally managed flood insurance program into private hands. The recommendations, if enacted, would significantly alter how states like Nebraska and others across the country prepare for, respond to, and recover from major disasters.
What Happened
The FEMA Review Council, established by President Trump, released a 75-page report Thursday outlining a series of major proposed changes to the nation’s disaster management framework. The panel called on Congress and the administration to reorient the federal government from the primary driver of disaster response to a supporting role — one that only activates fully when a disaster genuinely exceeds what state and local governments can manage on their own.
Among the report’s central recommendations is transferring the National Flood Insurance Program out of federal management and into the private insurance market. Robert Fenton, a FEMA regional administrator and council member, described the program as “financially unstable” and burdened with significant debt. He said moving NFIP policies to private insurers would return regulatory authority to states, which are already legally responsible for overseeing insurance markets.
Fenton noted that a subset of NFIP policies — roughly 5% — are classified as repetitive-loss properties, yet account for between 30% and 40% of all program payouts. The council recommended addressing those properties through buyouts or infrastructure improvements to reduce ongoing exposure.
Kevin Guthrie, executive director of the Florida Division of Emergency Management, said the panel’s core aim is to “equip state, local, tribal, and territorial governments to lead disaster response” while keeping the federal government in a supporting capacity. He argued that current federal thresholds for declaring major disasters are too easily triggered and should be recalibrated to reflect whether a community has truly been overwhelmed.
Former Mississippi Gov. Phil Bryant, also a council member, said state and local empowerment is essential, while adding that individuals themselves must take greater personal responsibility for disaster preparedness.
The White House said President Trump “looks forward to reviewing the recommendations” and “remains committed to getting resources to communities in need” while encouraging states to invest in their own resilience before disasters occur.
By the Numbers
- 75 pages — length of the FEMA Review Council’s published report
- 5% — share of NFIP policies classified as repetitive-loss properties
- 30–40% — portion of total NFIP payouts generated by those repetitive-loss properties
- 57–3 — House Transportation and Infrastructure Committee vote last September approving a bipartisan FEMA restructuring bill
- 70+ — number of House cosponsors on the bipartisan FEMA reform legislation
Zoom Out
The council’s recommendations reflect a broader policy direction the Trump administration has pursued throughout its second term. The president has publicly stated his intention to reduce FEMA’s centralized role, arguing that governors are better positioned to manage disasters within their own states. This push comes as Congress has been working on its own parallel FEMA reform effort — a bipartisan bill that would remove the agency from the Department of Homeland Security and re-establish it as a standalone Cabinet-level department. That legislation would also consolidate federal disaster assistance into a single application across multiple agencies. House Republican leadership has not yet scheduled a floor vote on the measure.
Disaster relief advocacy groups have raised concerns that the shift in responsibility could leave survivors underserved, particularly if states are not guaranteed federal reimbursement. Representatives from Texas Appleseed and other organizations argued Thursday that the recommendations, especially limits on individual assistance, would reduce the range of costs — including vehicle repair, medical expenses, and funeral costs — that federal aid can cover for affected residents.
What’s Next
Most of the review council’s recommendations will require congressional action before taking effect. The bipartisan FEMA restructuring bill, co-sponsored by Missouri Republican Sam Graves and Washington Democrat Rick Larsen, remains pending before the full House. Advocates and disaster relief organizations are pressing for its passage as a parallel track to the council’s broader reform agenda. The administration is expected to formally respond to the report in the coming weeks as the legislative calendar advances.
State governments, including those managing ongoing infrastructure and economic development priorities — such as Nebraska’s recent approval of tax incentives for sports facilities — may face increasing pressure to build dedicated disaster resilience funding into their own budgets as federal cost-sharing expectations shift.