WASHINGTON — The first trickle of federal funds has started to go out after Hurricane Sandy — $29 million to rebuild highways and $30 million to hire temporary workers to help with the cleanup. But lawmakers are just beginning to tally what is certain to be a multibillion-dollar bill for the federal government, at a time of fiscal restraint.
At least initially, New York, New Jersey and other states most affected by Hurricane Sandy will be spared the traditional fights in Washington over disaster assistance, thanks to a little-noticed provision in last year’s budget agreement that arose from the debt-ceiling fight and resulted in Congress setting aside roughly $12 billion for disaster relief.
The Federal Emergency Management Agency has $7.5 billion to spend this fiscal year, and an additional $5 billion could be made available, with no spending offsets required in other government programs.
While that will help in the short term, the East Coast states hit by the superstorm will almost certainly request billions in additional federal dollars, which would require appropriations by Congress and could set off partisan — or geographic — wrangling and stir long-standing concerns about fraud and waste.
Obama has pledged to speed federal aid to the hard-hit states, winning praise from state and local officials of both parties. But so far, the flow of money has been relatively modest in a disaster that economists estimate could leave up to $30 billion to $50 billion in damages — costs borne by individuals, businesses, insurers and the federal government.
FEMA had distributed $19 million in temporary housing aid and other assistance to 85,072 victims of the storm as of 11 a.m. Friday. The government ultimately paid out more than $7 billion in so-called individual and household assistance in the aftermath of hurricanes Katrina and Rita in 2005, an indication of how the bill from Hurricane Sandy could skyrocket.
The Department of Labor, meanwhile, has already kicked in another nearly $30 million to hire temporary workers to help with the cleanup.
Toll of the storm
The massive storm that started out as Hurricane Sandy slammed into the East Coast and morphed into a huge and problematic system, killing at least 105 people in the United States. Power outages now stand at more than 3.5 million homes and businesses, down from a peak of 8.5 million.
