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Make Me Smart with Kai and Molly

Episode 114: Antitrust the process

May 21, 2019

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What happens when the government declares a state of emergency?

Erika Beras Sep 13, 2018
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 In this NOAA satellite handout image, shows Hurricane Florence it just makes landfall off the coast of the U.S. in the Atlantic Ocean on Sept.13, 2018. 
NOAA via Getty Images

As the proverbial once every hundred years storms become yearly events in many parts of the U.S., it’s changing the economy around disasters.

Here’s what happens when the president or a state’s governor declares a state of emergency. Officially, it means the normal constitutional procedures can be suspended — it’s not business as usual.

Here’s what happens on the ground:

Lots of red tape gets cut

Most governmental bodies — federal, state, local — contract for all kinds of services in an arduous bidding process. During a state of emergency, contractors still have to register, and face competition for jobs, but the awarding of contracts happens much faster.

States get additional funding 

Once a state declares a state of emergency, it can then ask the federal government for funds. Additional money can come from the Disaster Relief Fund, the Federal Emergency Management Agency, or Congress can consider a special supplemental spending bill.

Those funds flow towards shelters, contract workers, back up

Even before a storm hits, states and cities often want to bring in personnel from non-affected areas to assist and relieve their own workers. The money helps pay for travel and other related expenses.

Bringing in  emergency responders from other states is usually anticipated, but can’t be paid for without access to funds.

Contractors register for the recovery effort

To be eligible for consideration for some of the recovery and relief contracts, businesses need to list themselves in state and federal databases. 

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