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DATE: November 16, 2004
TO: Interested Media
FROM: Jill Bratina, Governor's Communications Director
RE: Letter regarding tax relief to property owners participating in FEMA's hazard mitigation projects
The following letter was sent to Senate Majority Leader Bill Frist, Senate Majority Whip Mitch McConnell, Senate Minority Leader Tom Daschle, and Senate Minority Whip Harry Reid. A similar letter was sent to House of Representatives Leadership, the Chairman of the Senate Committee on Finance, Chairman of the House Committee on Ways and Means, members of the Florida Congressional Delegation, and Governors from states impacted by the hurricanes.
If you need further assistance please call the Governor's Press Office at 850-488-5394.
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November 12, 2004
The Honorable Bill Frist The Honorable Tom Daschle Senate Majority Leader Senate Minority Leader 461 Dirksen Senate Office Building 509 Hart Senate Office Building Washington, DC 20510 Washington, DC 20510 The Honorable Mitch McConnell The Honorable Harry Reid Senate Majority Whip Senate Minority Whip 361-A Russell Senate Office Building 528 Hart Senate Office Building Washington, DC 20510 Washington, DC 20510
Dear Majority Leader Frist, Majority Whip McConnell, Minority Leader Daschle, and Minority Whip Reid:
I am writing to urge consideration of S. 2886, introduced by Senator Kit Bond, which would provide tax relief to property owners participating in the Federal Emergency Management Agency's (FEMA) hazard mitigation projects.
These FEMA grant projects provide landowners with the funds necessary to mitigate potential damage from future natural hazards. They exist to protect people from devastating hazard-related damage, and to minimize costs to the Disaster Relief Fund, National Flood Insurance Program, and other Federal assistance programs. As disaster recovery efforts continue in Florida and throughout the country, the Administration has become concerned about a June 28th decision by the IRS that requires taxpayers to include the construction costs of FEMA mitigation projects as taxable income.
Under specific existing statutory and administrative exceptions, gross income does not include certain government payments made to individuals in response to needs resulting from disaster damage. However, grants under FEMA's mitigation programs are made to individuals to reduce the risks to hazard-prone properties from future disaster events.
Participation in the FEMA mitigation projects is voluntary, so I share the Administration's concern that owners of at-risk property may decline participation because of the tax obligation. Some of these property owners already bear a portion of the project cost, and may not be able to afford an additional burden. A number of states and communities have already indicated to FEMA that the tax would prevent property owners from including their homes in the mitigation effort.
Ultimately, if owners are unwilling or unable to protect their properties because of a tax obligation, they will remain in harm's way and be a potential drain on future federal assistance resources. This legislation is important in our effort to rebuild Florida and prepare for the threat of future disasters. I know that the Senate will have much to consider when Congress returns to complete the 108th session, but I respectfully request your assistance in making this a top priority.
Last updated: July 08, 2005
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