Summary — HB 954: Local Governments Disaster Fund
Status and key dates
- Bill number: HB 954
- Title (short): Local Governments Disaster Fund / State Critical Infrastructure and Construction Resiliency Fund
- Introduced: November 12, 2024
- Current status (per provided metadata): Passed 1st Reading; referred to committee (Local Government).
- Proposed effective date (in bill text): July 1, 2025.
- Where added: Amends Article 4 of Chapter 143C (state emergency management statutes).
Purpose and intent
- Establish a State Critical Infrastructure and Construction Resiliency Fund (the “Fund”) to finance resiliency, reconstruction, and disaster‑preparedness construction and infrastructure in counties affected by declared disasters. The Fund is administered by the Governor and is intended to supplement State and local disaster response and resiliency activities.
Key provisions
- Creation and administration
- Establishes the Fund within the General Fund and places administration responsibility with the Governor.
- The Fund will contain (a) appropriations from the General Assembly and (b) funds diverted from units of local government as described below.
Diversion of locally collected tax revenue
- The Department of Revenue is directed to reserve (divert) 5% of the highway use tax collected from a county each year if that county was within an emergency area for a Type I, II, or III disaster declared by the Governor.
- Counties that have been included in an emergency area under a declared Type I, II, or III disaster in the previous three fiscal years are eligible counties for this diversion.
Use of Fund proceeds
- The Governor may use Fund monies to pay for new construction and infrastructure in counties affected by a disaster within the declared emergency area for "specific resiliency and disaster preparedness purposes."
- The Governor may also use the Fund to pay for State and local disaster response activities following a Presidential major disaster declaration under the Stafford Act in the affected area.
Who is affected
- Counties included in a Governor-declared Type I, II, or III emergency area (and those included within the prior three fiscal years) — these counties would see 5% of their highway use tax collections reserved for the State Fund rather than remaining locally available.
- Department of Revenue — tasked with reserving the specified portion of tax receipts.
- Governor’s Office — gains administrative control over the Fund and discretion to allocate monies for resiliency, reconstruction, and disaster response.
- Local governments and residents — may experience reduced direct highway tax receipts but may gain access to state‑directed resiliency or reconstruction support.
Potential fiscal and policy impacts
- Revenue shift: A recurring diversion of 5% of county highway use tax receipts represents a revenue shift from local to State control for eligible counties; the magnitude varies by county depending on highway use tax collections.
- Budget and planning implications: Counties that rely on highway use taxes for road repair, maintenance, or local projects may face modest revenue reductions; conversely, affected counties could receive state-funded resiliency and reconstruction projects financed through the Fund.
- Administrative discretion: Centralized administration by the Governor creates potential for targeted, statewide prioritization of infrastructure and resiliency projects, but also raises questions about allocation criteria and local input.
- Implementation details (eligibility criteria, project selection, reporting, and oversight) are not specified in detail in the bill text and may be established later or require additional statute/regulation.
Notes and caveats
- “Type I, II, or III” disaster designations and the precise mechanics of highway use tax collections/reservations are governed by other statutes and administrative processes; local fiscal effects depend on each county’s tax base and frequency of disaster declarations.
- The version text includes an explicit July 1, 2025 effective date; actual enactment and implementation depend on the bill’s final legislative passage and any amendments.
