FEMA 2.0 — what the leaked draft of the FEMA Review Council report really means
Promises of federal reform are easy to make, but harder to spot in the wreckage of a devastating natural disaster.
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A leaked draft of the FEMA Review Council’s final report on reform of the disaster response agency appears to shift considerable burden onto states, local governments, tribes and territories (SLTTs) while slashing the agency’s workforce by 50%, positioning federal response in the rear and largely ignoring requests to send recovery funding down to the county level.
President Donald Trump established the FEMA Review Council on Jan. 24, 2025, charging its leaders, then Secretary of Homeland Security Kristi Noem and Secretary of War Pete Hegseth, with gathering stakeholder input and presenting a list of recommendations for improving the embattled agency.
The full draft report, obtained by The Smoky Mountain News, has been floating around Washington, D.C., since last December. Some details have already been reported by other outlets, but a full breakdown has never been presented until now.
Michael Whatley, former Republican National Committee chair, Trump’s Hurricane Helene “recovery czar” and current U.S. Senate candidate, was appointed to the council on April 24, 2025 — the only person to represent North Carolina.
The review council got off to a late start, blew through deadlines and saw its one-year charter come dangerously close to expiring until Trump renewed it through March 25.
What Noem and Hegseth wrote in an introductory letter that prefaces the report seems on its face to align with the stated goals of many Western North Carolina leaders who lived through and continue to deal with the effects of the devastating storm.
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“Throughout this lengthy process, the Council has focused their efforts on the key doctrine that disaster response should be locally executed, state or tribally managed and federally supported,” the report reads. “The first, best and most effective response to disasters comes from the local community and first responders where the disaster strikes.”
The report, however, creates a serious contradiction by talking at length about “local execution” but proposing a system where money flows through already-skeptical state governments concerned about being able to rely on federal support — especially in light of the fact that 18 months after Helene, North Carolina has only received around $7 billion of the $60 billion state estimates say is needed for full recovery.
A meeting on Dec. 10, 2025, was supposed to include a vote on the draft plan’s approval. The meeting was canceled. The report remains unfinished, and it’s unclear whether the council will issue a final report before its current charter expires. If it does, it may resemble the draft report — but it may not.
Implementation is another matter entirely. Most of the reforms would have no impact on Helene recovery in Western North Carolina, although some would.
Ten key points in the report serve as recommendations to shore up the ailing agency, but only time — and the next major disaster — will tell if the FEMA Review Council succeeds.
1. FEMA 2.0 — A NEW START
FEMA, as it currently exists, would be scrapped and replaced with a smaller, rebranded agency built around coordination rather than command. The proposal envisions cutting the workforce roughly in half over a two- to three-year period and pushing authority out of Washington and into state, tribal and local hands.
Responsibility for training, planning and day-to-day operations would shift downward, while the federal role narrows to oversight and limited support. Federal responders would no longer take the lead except in the most extreme cases, when SLTTs are overwhelmed.
Mentioned specifically in this recommendation, FEMA 2.0 should “endeavor” to close out historical disasters — like Helene — to reduce the administrative costs and legacy systems that exist solely to maintain open disaster declarations from years ago.
2. RECOMMEND FEMA 2.0 REMAIN IN DHS
Disaster response, in this framework, stays firmly inside the national security apparatus, rather than pulling FEMA out as a standalone agency. The plan keeps FEMA 2.0 within the Department of Homeland Security, tying emergency management to intelligence, logistics and interagency coordination already housed there. The argument is straightforward — large-scale disasters demand the same integrated response as other national threats.
DHS would become the central hub for all-hazards response, with FEMA 2.0 operating alongside other federal capabilities. Autonomy takes a back seat to consolidation, with the emphasis on faster coordination, shared resources and continuity of government during crises.
But DHS has a lot on its plate in addition to disaster response — it oversees border and immigration enforcement, counterterrorism, cybersecurity, protection of critical infrastructure and transportation security. It also coordinates intelligence and federal resources across agencies to prevent threats and respond to emergencies at the national, state and local levels.
It’s also undergoing transition; Noem is on her way out, and Oklahoma Sen. Markwayne Mullen’s confirmation is working its way through the Senate. In testimony on March 18, Mullen did refer to one choke point not mentioned in the report but frequently cited by local officials as problematic — Noem’s insistence that any check over $100,000 be signed by her. Mullen said he’d do away with Noem’s policy.
3. EQUIP STATES, LOCAL GOVERNMENTS, TRIBES AND TERRITORIES TO LEAD DISASTER RESPONSE WITH THE FEDERAL GOVERNMENT IN A SUPPORTING ROLE
Primary responsibility shifts decisively away from Washington; however, the implementation of national capability standards designed to establish some sort of baseline for response by thousands of state and local governments would necessarily increase bureaucracy.
Additionally, tribal entities interviewed for the report — dozens of them, including the Eastern band of Cherokee Indians — “emphasized the importance of maintaining government-to-government relationships with FEMA, advocating against routing assistance through states or counties.”
Further pushing responsibility away from the federal government, this recommendation also encourages FEMA 2.0 to lean into partnerships with volunteer and faith-based organizations, known as VOADs.
In September 2025, an investigation by The Smoky Mountain News found that although nonprofits stepped up big in the aftermath of the storm, they were stretched to their limits, calling the sustainability of repeated, long-term disaster recovery efforts into question. Nonprofits and VOADs also operate on a far smaller scale, dollar-wise, than the federal government does — meaning they’ll never replace even a fraction of federal recovery funding no matter how flexible or responsive they are.
Another particular point in the report seems to acknowledge the collapse of cellular and internet infrastructure that came with Helene — FEMA 2.0 should “Incentivize investments in interoperable systems for communication and data sharing to improve real-time coordination.”
Canton’s mayor, Zeb Smathers, was outspoken on the issue in the aftermath of the storm.
“We had to face down a 21st Century storm with 20th Century technology, and there is no doubt that the inability to communicate caused more damage — and possibly even cost lives,” Smathers said. “Further, to this day, I do not know exactly what happened, which is not acceptable. The seriousness of this issue is something local governments in North Carolina need to know about, something the public needs to know about.”
4. KEEP EXISTING FEDERAL DISASTER RESOURCES TO SUPPORT COMMUNITIES
Even as authority moves downward, federal capabilities should remain intact, according to the draft report, as well as “the responsibility to support these efforts when required.”
That promise sits uneasily alongside the proposed cuts. Slashing the workforce by roughly 50% while pledging to maintain support raises a basic capacity question; the same document that calls for a leaner, coordination-focused agency also relies on that agency to marshal federal assets, synchronize other departments and deliver timely assistance across jurisdictions.
Fewer staff, fewer regional resources and reduced on-the-ground presence could slow deployment and strain oversight, particularly during concurrent events.
5. REALIGN THE CRITERIA FOR FEDERAL DISASTER ASSISTANCE
Access to federal aid would become harder to reach. New thresholds would limit disaster declarations to events that clearly overwhelm state and local systems, replacing what is described as an inconsistent process.
When remnants of Tropical Storm Fred cut a half-billion dollar swath of destruction through eastern Haywood County in August 2021, the federal major disaster declaration didn’t come from the Biden White House for more than three weeks. With Helene, the Biden White House issued the major disaster declaration the next day.
If the recommendation is ever implemented, the major disaster declaration process will look very different.
“The current disaster declarations process for federal assistance does not adequately account for SLTT capacity and, therefore, is inconsistent with legislative intent and disincentivizes SLTT investment in disaster preparedness,” the report reads.
To remedy this, the report proposes an annual calendar year minimum expenditure for states prior to them being able to request a federal declaration — essentially, an unfunded federal mandate placing the burden on states.
"After what we’ve been through with Hurricane Helene, the last thing Western North Carolina needs is an agenda that makes it harder to get help,” said Jamie Ager, Democratic nominee for the 11th Congressional District who will face incumbent congressman Chuck Edwards in November. “This plan would leave communities like ours waiting longer to rebuild and put even more stress on our counties that are already struggling. This is not reform. It’s abandoning your promises. Chuck Edwards has had years and not only has he failed to get the funds we need, it seems his time in Congress has actually made things worse."
Other requirements for SLTTs include the implementation of a “statewide citizen preparedness program,” certification of insurance on past projects, an annually updated resource list and that more formalized responsibility for damage data collection be placed on SLTTs.
6. REPLACE THE HAZARD MITIGATION GRANT PROGRAM WITH A TWO-PHASE FUNDING STRUCTURE
The existing mitigation grant system would disappear, replaced by a faster, state-managed model called Refined Risk Reduction (R3P). Funding would arrive in two stages — an early infusion of 5% within weeks of a disaster for immediate mitigation, followed by a second round of 10% within six months.
Currently, the maximum federal cost share for the hazard mitigation grant program is 75%. Under the R3P program, that would not change, but the 75% level would only be achievable by SLTTs that perform well under the revised criteria for federal assistance. A 50% minimum cost share would form a baseline of aid.
7. STREAMLINE THE INDIVIDUAL ASSISTANCE PROGRAM INTO A SINGLE DIRECT PAYMENT PROGRAM
A single check would replace a maze of programs. Disaster survivors whose homes are uninhabitable would receive one direct payment instead of navigating multiple aid categories.
The current Temporary Housing Assistance program allows for a 100% federal cost share. The proposed Framework for Accessible Individual Relief (FAIR) program would cut that to 75%. Long-term housing recovery moves largely out of FEMA’s hands with greater reliance on private insurance and other federal agencies. States assume more responsibility for sheltering and immediate needs. Faster aid becomes the tradeoff for narrower federal support.
Renters would receive three months of the HUD fair market rent, with an additional three months for individuals with greater need. For homeowners, assistance would be limited to no more than 15% of the local government’s assessed value of the property, not to exceed $150,000.
In January, the average sales price of a home in Haywood County was down 4.8% from a year ago, to $424,536. In Buncombe County, it was $697,117, according to Canopy MLS.
Notably, the report reemphasizes that the individual assistance program is only for basic, critical needs and “is not designed to make survivors whole and is not a substitute for insurance coverage.”
8. REFORM THE PUBLIC ASSISTANCE PROGRAM TO PROVIDE DIRECT FUNDING BLOCK GRANTS
Reimbursement gives way to upfront funding under a newly designated “Reformed and Partnered Initiative for Disasters (RAPID) program.” Instead of waiting months or years for project approvals, states would receive block grants within 30 days of a major federal disaster declaration — which, according to recommendation 5, will become more difficult to get.
Currently, federal cost share on all four public assistance programs (emergency declarations, debris removal, emergency protective measures and permanent work) is no less than 75%. Under RAPID, federal cost sharing would shrink and hinge on performance — no less than 50%, with a maximum of 75% which would be subject to increase by the president.
That money comes with autonomy. States decide how to spend it, which projects qualify and how recovery unfolds. But it still leaves counties relying on middlemen to cut the check and shifts financial risk to states, which would be responsible for managing funds and absorbing overruns if costs exceed initial allocations.
During a March 16 Haywood County budget presentation — where commissioners learned the county had only received $1.6 million of the $19.2 million in claims it had submitted to FEMA — Commissioner Brandon Rogers reiterated his desire to see recovery funding pushed directly to counties.
“We’re held accountable every day for money that’s handed down either through the federal government or through the state,” Rogers said. “They need to do the same thing with storm cleanup.”
9. REFORM THE NATIONAL FLOOD INSURANCE PROGRAM FOR FINANCIAL STABILITY AND RISK RESILIENCE
Federal flood insurance takes a step back as the private market moves forward. Updated risk data, stricter pricing and reduced federal exposure form the backbone of the proposal.
Communities would face pressure to adopt stronger land-use policies and building standards, while homeowners would pay premiums that reflect actual risk, not supposed risk based on outdated risk maps.
Policies would gradually shift out of the federal system and into private hands, with FEMA focused on oversight and transition.
10. MAXIMIZE EVERY DOLLAR SPENT BY REDUCING ADMINISTRATIVE COSTS
Too much disaster money, in this view, never reaches the ground. Consultants, compliance requirements and layered grant processes consume a significant share of funding, slowing recovery and driving up costs.
The report quotes a FEMA official in Puerto Rico who said, “I have 500 contracted employees that would not be needed if FEMA’s grant process was not so complex.”
Simplifying programs and moving to direct funding models aims to cut that overhead. States would take on greater responsibility for auditing and financial oversight, with tighter accountability tied to funding. Less bureaucracy, fewer middlemen and more dollars flowing directly to recovery define the approach, even as administrative burdens shift away from the federal level.
WHAT’S NEXT
The current charter for the FEMA Review Council expires on March 26, unless renewed by the president as it was in January. A note on the council’s website says the council’s “meeting has been postponed” but doesn’t specify which meeting and doesn’t list any upcoming meetings.
A campaign spokesperson for Roy Cooper, Whatley’s opponent, places much of the blame on Whatley, who declined to comment on the leaked report.
“D.C. insider Michael Whatley has completely failed in his role as FEMA recovery czar and this leaked report — nearly five months late and not even finalized — continues to prove just how out-of-touch he is with what Western North Carolina needs,” said Jordan Monaghan. “After receiving only 12% of the federal funding they need to recover, Whatley now wants local communities to foot the bill with no plan in place to help them. North Carolina deserves better — Roy Cooper will work with leaders in both parties to fast-track federal funding to ensure the people of Western North Carolina get every federal dollar they are owed.”
Western North Carolina Congressman Chuck Edwards did not respond to an interview request.
