Draft Plan Would Halve FEMA Workforce, Rebrand Agency as 'FEMA 2.0' and Shift More Disaster Costs to States

A presidential review council has drafted sweeping changes to the Federal Emergency Management Agency that would significantly shrink the agency's federal role in disaster response, rebrand it as "FEMA 2.0," and shift more responsibility and costs to states.

Overview

The FEMA Review Council's draft report — obtained by CNN and expected to be voted on this Thursday before heading to President Trump — recommends cutting FEMA's workforce by roughly 50%, rebalancing staff away from Washington, D.C., and implementing a new block-grant model intended to get funds to states within 30 days of major disaster declarations. The recommendations stop short of abolishing FEMA but call for a major reorganization and rebranding.

Key Recommendations

• Workforce Reduction: A 50% cut in FEMA staff staged over two to three years, with savings to be returned to states under the new funding model.
• Rebrand as "FEMA 2.0": The draft suggests a transitional name and a renewed emphasis on state- and tribal-led emergency management with federal support.
• Remain Inside DHS: The council recommends keeping FEMA under the Department of Homeland Security, preserving DHS oversight of the agency's roughly $25 billion budget.
• Higher Thresholds for Aid: The proposal would raise the bar for federal assistance so that only truly catastrophic events exceeding state, local, tribal, and territorial capacity would trigger large-scale federal help.
• New Block Grants: A block-grant system aimed at delivering disaster aid within 30 days of a major declaration, with states taking on larger cost shares.
• Streamlined Individual Assistance: Consolidation of individual aid into a single, capped direct payment to survivors based on property value and assessed need to speed recovery.
• Mitigation and Insurance Changes: Replace the current Hazard Mitigation Grant Program with a two-phase funding approach (immediate repairs, then long-term risk reduction) and encourage private insurers to assume more National Flood Insurance Program policies with risk-based pricing.

Political Context and Concerns

The draft is the product of months of closed-door debate. Many agency veterans, state officials, and public commenters urged making FEMA independent of DHS, arguing that independence would insulate emergency management from political interference. Secretary Kristi Noem, who co-chairs the council and opposed separation, prevailed — the report recommends keeping FEMA within DHS and maintaining departmental control over budgeting and intelligence resources.

'It is time to close the chapter on FEMA,' the report states, advocating a new agency that retains FEMA's core missions while emphasizing locally executed and state- or tribal-managed emergency response.

Some proposals floated earlier — such as relocating FEMA's headquarters out of Washington, D.C. — were dropped from the draft. But other changes, including workforce cuts and grant-program overhauls, have alarmed veteran FEMA officials and state emergency managers who warn such moves could reduce national readiness for major disasters.

Implementation And Legal Hurdles

Several major items in the draft would require congressional action or regulatory changes. The council previously discussed proposals to dramatically raise disaster thresholds — at one point considering quadrupling them — but did not publish final guidance. Key grant program cuts, including reductions to the Building Resilient Infrastructure and Communities (BRIC) program, are already tied up in litigation.

Implications

Supporters of the overhaul say it streamlines federal assistance and returns greater responsibility to states. Critics warn that trimming FEMA while increasing state burdens could leave the nation less prepared for intensifying storms and disasters driven by climate change. The draft arrives while Congress is considering the bipartisan FEMA Act — a bill that would make FEMA independent and create state block grants — and underscores high-stakes debate over the federal role in disaster preparedness and recovery.

What's Next: The council is scheduled to vote on the recommendations Thursday, after which the final report will be delivered to the president for review. Many elements will need congressional approval to take effect.