ADR to Help Administer Aid to Hurricane Sandy Victims

Natural disasters create a wide spectrum of pain and loss among a broad array of individuals and businesses and Hurricane Sandy is a recent example of the type of disaster. The federal government, through FEMA, has the ability to step in and administer relief programs, but sometimes the process is hampered by questions about who is entitled to disaster relief and who is not. These disputes can slow the process of providing relief and courts are simply not nimble enough to keep pace with rapidly evolving situations.

The Robert T. Stafford Disaster Relief and Emergency Assistance Act was recently amended in late January to require that ADR (including binding arbitration) be used to decide who is eligible for disaster relief aid.

Section 1105(b) of the Act states (in pertinent part) that within six months, an ADR mechanism shall be created that allows any applicant to resolve dispute relating to eligibility for assistance.  This ADR mechanism may include binding arbitration by “an independent review panel.”   The panel must issue a written decision, but it may only set aside an Agency decision found to be “arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law.”  The standards are clearly quite high for a reversal of an agency decision, but nonetheless, the rights of applicants have been significantly expanded with the passage of this bill.

The results of the first 270 days of the program will be reported by the Comptroller General to the Committee on Homeland Security and Governmental Affairs of the Senate and the Committee on Transportation and Infrastructure of the House of Representatives to analyze the effectiveness of the program.

We send our best wishes to everyone who suffered losses as a result of Hurricane Sandy.