FEMA canceling community disaster loan balances of $790 million for territories
The United States Federal Emergency Management Agency (FEMA) is cancelling the repayment of over $870 million in outstanding community disaster loan balances, of which $790 million were from the US territories of Puerto Rico, the US Virgin Islands, American Samoa, and the Northern Mariana Islands.
The Community Disaster Loan Program is available to local governments that have been adversely affected by major disasters. The cancellation is a result of congressional legislation in the continuing budget resolution that began on October 1, 2021. The legislation cancelled any outstanding loan balance and will provide significant flexibilities to communities recovering from disasters, as they can use the funds to cover expenses. FEMA recently sent notifications to the 158 loan holders notifying them of this cancellation.
As major loan holders, US territories and territorial governments will especially benefit from this loan repayment cancellation. Cancelled loans include:
- More than $3.8 million cancelled for American Samoa.
- More than $94 million cancelled for the Northern Mariana Islands.
- More than $371 million cancelled for Puerto Rico.
- More than $322 million cancelled for the US Virgin Islands.
This cancellation will also provide significant relief to states along the Gulf Coast, including:
- More than $27 million cancelled for Florida.
- More than $6 million cancelled for Louisiana.
- More than $3.5 million cancelled for Mississippi.
- More than $13 million cancelled for Texas.
Under normal circumstances, the loan holders would have had to repay these loans under a term of five years (unless extended to 10),