Does FEMA Pay for Your Residential Storm Shelter?

All shelter models are debris impact tested at the National Wind Institute and verified to hold up to winds over 250 mph, but it’s not a guarantee that they won’t get damaged. In an effort to prevent loss of life and storm damage, the Federal Emergency Management Agency (FEMA) provides grants to reimburse homeowners for damaged storm shelters. Usually, the grant compensates the cost of a residential storm shelter up to 75%. Note that FEMA doesn’t distribute the funds directly to the homeowners; instead, it disburses the funds through the Hazard Mitigation Assistance program to eligible states, communities, or territories. It’s important for homeowners living in tornado-prone areas to understand the types of funding available and the criteria for program eligibility.

Residential Funding

The first type of funding is Residential funding. This funding is available to individuals who constructed a residential storm shelter that was damaged during a storm. The homeowner should liaise with the State Hazard Mitigation Officer to determine any additional information required to get the funding. The officers should also provide information about different funding sources and applicable state, federal, and state design requirements.

Community Development Block Grant Funding

The second type of funding is Community Development Block Grant funding. After the Tornado Shelters Act was signed into law, communities were required to use block grant funds to build tornado shelters in home parks. This means homeowners living in these communities and seeking compensation must comply with the Housing and Community Development laws. These include:

  • The shelter should be located in a park with 20 or more units consisting of low and moderate-income households.
  • The shelter must be in a tornado-prone state, and the last storm must have occurred in the current year or within the last three years.
  • The residential storm shelter must have complied with tornado-appropriate safety construction standards.
  • The shelter should be large enough to accommodate all the members of the neighborhood.

Hazard Mitigation Grant Program Funds

The third type of funding is Hazard Mitigation Grant Program (HMGP) funding. This program assists states and local communities to implement long-term hazard mitigation measures after a disaster. As such, homeowners seeking compensation through this program must have an approved hazard mitigation plan in place to be eligible for funding. HMGP grants fund projects providing protection to private and public properties. Examples of projects eligible for grants under this program include:

  • Relocating, acquiring, or demolishing structures located in hazard-prone areas.
  • Constructing community and residential storm shelters in tornado-prone areas.
  • Retrofitting homes to protect them from high winds, floods, earthquakes, and other natural disasters.

Pre-Disaster Mitigation Program Funds

Finally, there is Pre-Disaster Mitigation Program funding, too. This grant provides funding to eligible communities around the country. The premise for this program is to fund the construction of residential tornado shelters to avoid disaster. Mitigation planning is critical to breaking the cycle of reconstructing structures after every disaster. The grants are funded annually via Congressional appropriation, hence it is nationally competitive. Also, there are no specific amounts granted to states. FEMA usually prioritizes projects addressing flood-prone areas, and a benefit-cost analysis is performed for each proposed project.

How the Funds Are Disbursed to Homeowners

Many homeowners seek compensation via the Hazard Mitigation Grant Program. As such, if you have met the eligibility criteria, you qualify to receive the grant or rebate. Normally, the homeowner must first pay the full price of the residential storm shelter and then apply for reimbursement. Note that homeowners don’t receive the reimbursement instantly; they may need to wait for four to eight weeks.

What You Should Know Before Beginning the Application Process

FEMA grants only compensate loss up to a fixed amount. Here is some more information homeowners should know before applying for compensation:

  • While FEMA provides 75% of the cost, the amount is capped at $4 million. However, smaller communities may receive up to 90% of the structure’s cost.
  • Since the grant money covers 75% of the structure’s cost, the homeowner needs to pay for the balance and the finishing cost out-of-pocket.
  • While local governments, states, and federally-recognized tribes are eligible for the grant monies, the applications should be submitted during the open application cycle, usually during FEMA’s fiscal period.
  • Before the grant money is disbursed, FEMA needs to approve the construction plan. This is because the organization makes funding decisions based on the most effective use of the grant.

Setting up a tornado shelter can be expensive. As such, applying for compensation goes a long way in helping homeowners reconstruct the shelters. Take the time to understand these types of funding as well as program eligibility.