Congress reintroduces bipartisan disaster mitigation bill to support homeowners
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Brett Mattson
Naomi Freel
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Key Takeaways
Updated 03/17/25. Originally posted 02/13/25.
On March 5, Disaster Mitigation and Tax Parity Act (H.R. 1849) was introduced to the U.S. House of Representatives. This introduction follows the late-January introduction of the same bipartisan legislation in the Senate (S. 336). Please see below for more information about the Act and the impact on counties.
On January 30, a bipartisan group of senators reintroduced the Disaster Mitigation and Tax Parity Act of 2025 (S. 336), a bill aimed at eliminating federal taxation of state-provided residential mitigation grants. NACo previously supported this legislation and continues to advocate for its passage to support county resilience efforts.
About the Disaster Mitigation and Tax Parity Act of 2025
The Disaster Mitigation and Tax Parity Act of 2025 ensures that qualified catastrophe mitigation payments—funds provided under state-based programs to strengthen homes against disasters like windstorms, earthquakes, floods and wildfires—are excluded from federal taxable income. Currently, while similar federal grants are exempt from taxation, state-funded mitigation grants remain subject to federal tax, creating an uneven burden on homeowners investing in disaster preparedness.
Impact on Counties
Counties are on the front lines of disaster preparedness and response, and state-funded mitigation grants help residents safeguard their homes before disasters strike. However, the federal taxation of these grants reduces their effectiveness by imposing additional costs on homeowners. By eliminating this tax burden, the Disaster Mitigation and Tax Parity Act of 2025 would:
- Increase participation in state-based mitigation programs, leading to stronger, more resilient communities.
- Reduce long-term recovery costs for residents by promoting proactive disaster resilience.
- Align federal tax policy across mitigation funding sources, ensuring fair treatment for homeowners receiving state-supported assistance.
NACo strongly supports this legislation and urges Congress to advance it swiftly. Ensuring fair tax treatment for disaster mitigation grants will help counties and residents alike in preparing for and mitigating the impact of future disasters.
Featured Initiative
Intergovernmental Disaster Reform Task Force
As disasters intensify across the country, county governments play a crucial role on the frontlines of emergency management and recovery. With a commitment to advancing federal policies that foster collaboration between counties, federal agencies and other intergovernmental partners, the Task Force builds on years of county-led efforts to enhance disaster policies and practices, driving improved outcomes nationwide.
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