New Executive Order Targets Rebuilding and Disaster Recovery

The Trump administration is taking aim at state and local permitting and related rules that they say are unnecessarily slowing rebuilding in the aftermath of disasters.

In late January, President Trump signed an Executive Order aimed at stripping California and Los Angeles of permitting authority for rebuilding in areas affected by the 2025 wildfires. The action came amid some media criticism of the pace of rebuilding.

The Executive Order also calls on the Federal Emergency Management Agency (FEMA) and the Small Business Administration (SBA) to consider issuing new rules to preempt state and local permitting processes that “unduly” slow federally funded rebuilding.

SBA moved quickly and issued an interim final rule that allows federal officials to waive certain state and local permitting requirements for SBA loan recipients when delays exceed sixty days. At that point, recipients could proceed with reconstruction through a federal self-certification process, and state and local enforcement actions and stop-work orders would be prohibited. The rule is designed to apply retroactively to SBA loans approved since January 1, 2025.

The new rules would apply only to projects financed with SBA disaster loans and cover procedural requirements and permits. Excluded from the rule’s scope are building codes, health and safety requirements, and certificates of occupancy. Despite those exclusions, the scope of the preemption is significant.

Preemption, Legal Challenges, and Planning Implications Arise

Based on the Executive Order, many expect similar regulatory actions from FEMA. If so, those rules would apply to virtually all federal recovery funding. While not all code and land use regulations are included in the initial rule, it appears likely that future actions could increase the extent of local preemption. It also raises concerns that post-disaster recovery plans could be compromised or ignored.

The SBA rule and the process created under the Executive Order for Los Angeles seem likely to draw scrutiny given the sweeping nature of the preemptions and the scant statutory authority to do so. Administration officials believe that their authority to set disaster grant and loan conditions allow for the proposed changes to supersede state and local processes in certain cases, but there are certain to be legal challenges to that assertion.

The new rule and Executive Order come against the backdrop of a growing congressional focus on FEMA. Bipartisan legislation is pending that would overhaul FEMA’s structure and make changes to the relationship between FEMA and local governments. Other legislation would create a new interagency task force charged with providing recommendations on streamlining and enhancing disaster relief. Congress may be seeking to drive reforms at FEMA to forestall the Trump administration’s stated intention to dismantle much of the agency’s mitigation and recovery programs.

The implications for planners could be significant, particularly with the implementation of post-disaster recovery plans and mitigation activities in post-disaster environments. The potential of FEMA funds being included in similar preemption would significantly expand the impact, as would any effort to include additional categories of state and local codes and rules. Planners already are dealing with new delays in federal disaster designations and funding uncertainty for pre-disaster mitigation planning.

APA has included FEMA and federal resilience policy among its top priorities for 2026 and is working with a range of coalition partners on these regulatory issues and legislation affecting mitigation and recovery planning. 

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