Three years after the July 2023 floods, communities across Vermont are still working on long-term recovery, with much of the effort focused on housing. Changes tucked into a new federal housing law could make aid for those efforts more predictable in the future. 

The new policy, part of an enormous federal housing bill that became law July 11, could smooth some of the perennial obstacles in long-term disaster recovery. The law applies to funding administered through the Department of Housing and Urban Development, not the Federal Emergency Management Agency. 

Although the law leaves many questions unanswered, Vermont’s disaster recovery chief said he sees the changes as a step in the right direction. 

The long-term recovery program, known as CDBG-DR, addresses needs that aren’t met by FEMA or Small Business Administration funding. The program funds are often designed to prioritize low- and moderate-income communities. 

Vermont received more than $67 million through the program after the July 2023 floods, much of which has been used to fund new housing and infrastructure improvements. 

Experts and former HUD officials pointed out that the law doesn’t address one of the biggest sources of uncertainty in long-term disaster recovery: Congress’ willingness to fund it, and the timeline on which it does so. The program will continue to rely on Congress allocating money, which it has historically done on an ad-hoc basis. 

But the policy could address some of the other instability that has hampered the program in the past. Historically, HUD had to create rules about how the program worked each time Congress chose to fund it. 

“Without a permanent structure for those funds, you end up having to redo a lot of things time and time again,” said former HUD official Stan Gimont. Gimont directed the funding program under the second Obama and first Trump administrations; he now works at Hagerty Consulting, a disaster recovery consulting firm.  

The new law instructs HUD to create permanent rules about how the funding is used, creating more predictability for communities, Gimont and other experts said. Those rules will be created over the coming year through a public process.  

Policy experts have also pointed to parts of the new law that set timelines for HUD to get money to communities, saying that will allow funds to reach communities more quickly after a disaster. 

“Eventually, when there’s money in it, they’ll be able to make grants more quickly after disasters,” said Marion McFadden, another former HUD official who previously oversaw the disaster recovery funding. McFadden now works on disaster recovery at consulting firm IEM. 

But since the law didn’t put any funding in the program, the program remains reliant on future appropriations. The wait for congressional funding for long-term disaster recovery has been a large part of delays in the past. For example, after the July 2023 floods, HUD funding for long-term recovery was not allocated by Congress until December 2024, 17 months later.  

“You’re going to create the shell with the authorization, but you still need to fill the bucket,” Gimont said. “Once the money is available, things should go more quickly. The question is, when will money be available?”

“It’s a step forward,” Gimont added. “It can do some good, but at the same time, Congress has to provide the money if it’s ultimately to be effective.” 

Farnham, the Vermont recovery officer, said he saw the new law as an improvement. 

“The way I’m viewing the changes, they’re not guaranteed to fix that timing uncertainty, but I think they’re only helpful,” Farnham said. 

“Even if we still want to see more, it’s very nice to see the approach moving towards something that is more — should be more — predictable,” he added. 

The law also leaves open questions about which disasters will qualify for long-term assistance through HUD. Setting those standards will be part of the public rule-making process over the next year. 

“We’ve flagged that as something we’re going to really be paying close attention to,” Farnham said.  

The law also includes a “sunset” provision, meaning the program could end after three years, although other language in the law allows it to continue if Congress continues to fund it. 

McFadden thinks it’s likely that Congress will do exactly that. 

“There have been many times when HUD program authorizations have expired, but the programs keep going because appropriations keep coming,” she said. 

“Congress keeps turning to this program to go where the other programs can’t reach.”