S. 3895 – Fairness in Federal Disaster Declarations Act of 2026

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Updated March 12, 2026 at 4:21 AM UTC

The Fairness in Federal Disaster Declarations Act of 2026 directs FEMA to create new rules that set clear, weighted criteria for deciding when public and individual disaster assistance is needed. By requiring specific percentages for factors like local impact, insurance coverage, and economic conditions, the bill aims to make disaster aid decisions more transparent and consistent. The changes affect how FEMA evaluates assistance requests for disasters whose major disaster declarations were denied after 2012.

Key Provisions

The FEMA Administrator must issue new rules within 120 days of the bill’s enactment, updating the existing regulations under 44 C.F.R. §206.48.
For public assistance, the new rules must assign weighted scores to seven factors—estimated cost (10%), localized impacts (40%), insurance coverage (10%), hazard mitigation (10%), recent multiple disasters (10%), other federal assistance programs (10%), and local/state economic conditions (10%).
For individual assistance, the rules must assign weighted scores to seven factors—concentration of damages (20%), trauma (20%), special populations (20%), voluntary agency assistance (10%), insurance (20%), average state individual assistance (5%), and local economic conditions (5%).
The rules must consider specific economic indicators such as local tax base, sales tax, median income relative to the state, poverty rates, and state unemployment versus the national rate.
The revised rules apply to any disaster where a governor’s request for a major disaster declaration was denied on or after Jan. 1, 2012.

Legislative Activity

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1 earlier action

SenateIntro Referral Latest Action

Read twice and referred to the Committee on Homeland Security and Governmental Affairs. (text: CR S652-653)

Homeland Security and Governmental Affairs Committee

February 24, 2026

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SenateIntro Referral

Introduced in Senate

February 24, 2026

SenateIntro Referral

Read twice and referred to the Committee on Homeland Security and Governmental Affairs. (text: CR S652-653)

Homeland Security and Governmental Affairs Committee

February 24, 2026

Floor Debate

2 members

What members said about S. 3895 on the floor

2 Democrats

Sen. Jack ReedD-RI · Feb 24, 2026

Mr. President, today I am introducing the Foreign Stablecoin Transparency Act. This important legislation would close a loophole in the Guiding and Establishing National Innovation for U.S.…

Mr. President, today I am introducing the Foreign Stablecoin Transparency Act. This important legislation would close a loophole in the Guiding and Establishing National Innovation for U.S. Stablecoins, or GENIUS, Act by extending a provision that requires large U.S. stablecoin issuers to undergo a full financial statement audit to also cover large foreign stablecoin issuers that offer and sell their products to U.S. investors.

Stablecoins are cryptocurrencies whose value is pegged to a real- world asset, which under the GENIUS Act is the U.S. dollar. The basic promise that stablecoin issuers make to their holders is that a stablecoin will always be redeemable for a dollar on demand. You give a stablecoin company a dollar, the company gives you back an IOU that is recorded on a blockchain. The stablecoin company takes your dollar and invests it in various safe assets that are purportedly able to be liquidated at any time to meet redemption requests.

All kinds of companies that handle the American peoples' money must undergo financial statement audits. U.S.-based dollar stablecoin issuers with $50 billion of stablecoins in circulation must get an audit. Banks of all sizes must get audits, even the smallest community banks. Many States require licensed money transmitters to submit audited financial statements to provide transparency and verify their financial health. Even unregistered private funds that are sponsored by U.S. investment advisers must get audits. And of course, all public companies must get audits. So it strikes me as entirely sensible to extend this very same requirement to foreign issuers of dollar-backed stablecoins, which handle Americans' money--just like so many other institutions that are subject to audit requirements.

Unless stablecoin issuers are audited, there is no independent verification that the company has enough assets to cover all stablecoins in circulation. Instead, holders must take the word of the issuer. If the issuer does not have sufficient reserves or is found to be cooking the books, then a stablecoin company may experience a ``run'' on its assets and holders will not be able to get their money back despite being sold something that they are told is safe and redeemable on demand. That is why we need audits of all companies that issue dollar-backed stablecoins to Americans.

A major flaw of the GENIUS Act is that stablecoins issued by companies with headquarters outside the United States are not required to undergo audits. Unless this flaw is addressed, the world's largest dollar-backed stablecoin--Tether, which is based in El Salvador--can be freely offered, sold, and used by Americans without being compelled to provide a full accounting of the reserves backing its coin. Tether purportedly has $187 billion in assets and is an essential piece of the crypto financial system plumbing. All manner of crypto-assets are bought and sold not with fiat currency, but with dollar-backed stablecoins like Tether.

During his confirmation hearing before the Senate Commerce Committee in 2025 Commerce Secretary Howard Lutnick testified, ``I believe U.S. dollar-backed stablecoins should be fully audited.'' Earlier this week before the Senate Appropriations Committee, I asked him whether this specific statement included Tether, and he said ``I absolutely agree with you, Tether should be audited.

Although Secretary Lutnick has no formal role in overseeing cryptocurrency, he has significant experience in this area. His former investment bank Cantor Fitzgerald has very deep ties to Tether. Cantor owns a 5 percent stake in the company, manages the reserves backing its stablecoin, and has cosponsored various crypto investment funds with Tether.

My legislation would require foreign stablecoins backed by the U.S. dollar like Tether to undergo an audit, no matter where the company is located. And a full audit is essential. In 2021, Tether was fined by the Commodity Futures Trading Commission for lying about its reserves. The CFTC found

that ``Tether misrepresented to customers and the market that Tether maintained sufficient fiat reserves to back every USDt in circulation `one-to-one' . . . and that Tether would undergo routine, professional audits to demonstrate that it maintained `100% reserves at all times.' In fact . . . Tether failed to maintain fiat currency reserves . . . to back every USDt in circulation.'' Despite Tether executives promising for years that they want to get an audit, we have yet to see them do so. Instead, Tether has published quarterly ``attestations'' by the Italian arm of a mid-tier accounting firm that simply verify information that Tether provides to that firm using procedures that are mutually agreed. That is very different than true independent third- party verification based upon standardized procedures with criminal and civil penalties if financial statements contain false information.

If foreign stablecoin issuers want the privilege of creating and handling the American people's money, then I agree with Secretary Lutnick that it is entirely sensible for them to open up their books for the American people to see, just as we expect of large U.S. stablecoin companies, banks, and other payments companies. If the goal of the GENIUS bill is to create incentives for stablecoin issuers to come onshore and operate fully within the U.S. regulatory perimeter, then we must close this alarming gap that incentivizes dollar creation by foreign companies.

I urge my colleagues to support this critical legislation.

Sen. Chris Van HollenD-MD · Feb 24, 2026

Mr. President, today, I am cosponsoring the American Homeownership Act. When Wall Street buys up homes in communities across the country, we have all too often seen families get squeezed by higher…

Bill Text

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Introduced in SenateIssued February 24, 2026

II

119th CONGRESS

2d Session

S. 3895

IN THE SENATE OF THE UNITED STATES

February 24, 2026

Mr. Durbin (for himself and Ms. Duckworth) introduced the following bill; which was read twice and referred to the Committee on Homeland Security and Governmental Affairs

A BILL

To require rulemaking by the Administrator of the Federal Emergency Management Agency to address considerations in evaluating the need for public and individual disaster assistance, and for other purposes.

1.

Short title

This Act may be cited as the Fairness in Federal Disaster Declarations Act of 2026.

2.

Regulatory action required

(a)

In general

Not later than 120 days after the date of enactment of this Act, the Administrator of the Federal Emergency Management Agency (in this Act referred to as the Administrator) shall amend the rules of the Administrator under section 206.48 of title 44, Code of Federal Regulations, as in effect on the date of enactment of this Act, in accordance with the provisions of this Act.

(b)

New criteria required

The amended rules issued under subsection (a) shall provide for the following:

(1)

Public assistance program

Such rules shall provide that, with respect to the evaluation of the need for public assistance—

(A)

specific weighted valuations shall be assigned to each criterion, including—

(i)

estimated cost of the assistance, 10 percent;

(ii)

localized impacts, 40 percent;

(iii)

insurance coverage in force, 10 percent;

(iv)

hazard mitigation, 10 percent;

(v)

recent multiple disasters, 10 percent;

(vi)

programs of other Federal assistance, 10 percent; and

(vii)

economic circumstances described in subparagraph (B), 10 percent; and

(B)

the Administrator shall consider the economic circumstances of—

(i)

the local economy of the area affected by the disaster, including factors such as the local assessable tax base and local sales tax, the median income as it compares to that of the State, and the poverty rate as it compares to that of the State; and

(ii)

the economy of the State, including factors such as the unemployment rate of the State, as compared to the national unemployment rate.

(2)

Individual assistance program

Such rules shall provide that, with respect to the evaluation of the severity, magnitude, and impact of the disaster and the evaluation of the need for assistance to individuals—

(A)

specific weighted valuations shall be assigned to each criterion, including—

(i)

concentration of damages, 20 percent;

(ii)

trauma, 20 percent;

(iii)

special populations, 20 percent;

(iv)

voluntary agency assistance, 10 percent;

(v)

insurance, 20 percent;

(vi)

average amount of individual assistance by State, 5 percent; and

(vii)

economic considerations described in subparagraph (B), 5 percent; and

(B)

the Administrator shall consider the economic circumstances of the area affected by the disaster, including factors such as the local assessable tax base and local sales tax, the median income as it compares to that of the State, and the poverty rate as it compares to that of the State.

(c)

Effective date

The amended rules issued under subsection (a) shall apply to any disaster for which a Governor requested a major disaster declaration under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.) that was denied on or after January 1, 2012.