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Tips for Finance & Accounting: Managing Payroll During Disasters

FEMA Reimbursement

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Tips for Finance & Accounting: Managing Payroll During Disasters

Cities and counties can incur millions of dollars in disaster response and recovery costs. Although most of these costs are eligible for FEMA reimbursement, if cost and time expenditures aren’t properly recorded localities may be denied assistance or forced to return money years after the disaster hits.

Some municipalities have an appointed disaster financial manager, while others designate their city finance director or a staff member with accounting experience to document payroll during a disaster. Regardless of your experience managing payroll during a disaster, IBTS provides the following tips based on first-hand experience managing payroll before, during and after a disaster to ensure FEMA reimbursement to the maximum extent possible.

Begin keeping payroll records as soon as the possibility of a natural disaster becomes apparent.

  • Activities performed before a disaster even makes landfall can be eligible for reimbursement. These include tasks like going door-to-door to evacuate residents, sandbagging, shelter setup and any other task tied directly to the event.
  • Even if the presidential disaster declaration is not made pre-landfall, keeping detailed payroll records of activities that occur before the declaration can maximize the reimbursement funds you receive and support your state’s request for a presidential disaster declaration.

Be familiar with your role and responsibilities before a natural disaster occurs.  

  • Train with your emergency operations team prior to a disaster and consider enrolling in a FEMA training course.
  • Be prepared to report to the emergency operations center (EOC), where you can quickly receive direction from the emergency  manager and gather information from other team members.

Be ready with multiple mechanisms for tracking payroll.

  • IBTS suggests using the WH-347 form — a standardized fillable PDF payroll form recognized by every federal agency — to track disaster related costs.
  • Download and save a copy of the form to multiple computers before an event so it’s available even if there is no internet access.
  • Store printed copies in a protected location so they are available in the event that computer access is limited. Make sure they are accessible to other emergency operations team members in case you are unable to fulfill your role.

 Maintain records for at least 10 years following a disaster.

  • FEMA can request an audit five to eight, and sometimes even ten years after a disaster hits. If documentation is unavailable, incomplete or incorrect, you may be forced to repay the funding you received.
  • FEMA only requires that documents be maintained for five years, however through experience and as an extra precaution, IBTS recommends keeping documents for 10 years.

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