Don't Sleep on EDA's $1.45 Billion Disaster Recovery Fund

Most disaster recovery conversations start and end with housing. That makes sense — people need roofs over their heads. But housing recovery without economic recovery is a half-built bridge. And right now, there’s a significant funding opportunity that too many communities are ignoring.

The U.S. Economic Development Administration has opened its Disaster Supplemental Grant Program, making approximately $1.45 billion available for economic recovery in areas with major disaster declarations from 2023 and 2024. Applications for Industry Transformation grants are due March 3, 2026. That deadline is close, and I’d bet most eligible communities haven’t started their applications.

Economic Recovery Can’t Wait Years

Here’s what I’ve seen across multiple states and disasters: economic recovery attention varies wildly depending on the state. The ones that handle it well have three things in common — dedicated economic recovery staff, action plans that prioritize economic recovery from day one, and the urgency to get funds deployed fast.

That last piece matters more than people realize. Housing recovery can stretch over years and still serve its purpose. Economic recovery doesn’t have that luxury. When funding arrives two or three years after a disaster, the damage is already done. Small businesses that held on for six months couldn’t hold on for eighteen. Workers who needed paychecks relocated to cities with jobs and didn’t come back. The tax base eroded. Commercial corridors went dark.

It’s a cascading effect. Businesses close, workers leave, the tax base shrinks, and the community enters a downward spiral that no amount of late-arriving grant money can fully reverse. Speed isn’t just a nice-to-have in economic recovery — it’s the difference between stabilizing a community and watching it hollow out.

Where Communities Should Focus

For communities looking at this EDA funding, two priorities stand out: small business support and workforce development.

Small businesses are the backbone of local economies in disaster-affected areas. They’re also the most vulnerable. A restaurant that lost its building, an auto shop that lost its customer base, a retail store operating out of a temporary space — these businesses need targeted support to survive the recovery period. Grant funding that helps them reopen, retool, or relocate within the community keeps the local economy’s engine running.

Workforce development is equally critical, and it carries a benefit that gets overlooked. Training programs for tradespeople, case managers, and construction workers don’t just address long-term employment needs — they build the workforce that powers the recovery itself. Every carpenter trained locally is one fewer contractor imported from out of state. Every case manager hired from the affected community is someone who understands the neighborhood they’re serving. Workforce development in a disaster context is self-reinforcing: it creates jobs while creating the capacity to rebuild.

Think Past the Quick Fix

The biggest mistake I see communities make with economic recovery funding is thinking too small. They propose short-term fixes — a temporary business loan program, a one-time grant to a handful of employers — without building anything durable.

The EDA isn’t looking for band-aids. They’re funding economic transformation. Communities that win these grants are the ones proposing investments that will strengthen their economic base for decades: workforce training centers, small business incubators, broadband infrastructure in underserved commercial areas, regional partnerships that create resilient supply chains.

If your community was hit by a hurricane, wildfire, or flood in 2023 or 2024, this funding exists for you. But you need to think beyond patching what broke. Think about what your local economy needs to be stronger than it was before the disaster hit.

The Clock Is Ticking

March 3 is the deadline for Industry Transformation grant applications. That’s not much runway. But communities that have already been through the CDBG-DR action planning process have a head start — much of the needs assessment and stakeholder engagement work translates directly to an EDA application.

If you’re eligible and haven’t started, start now. If you’re on the fence about whether to apply, get off the fence. The communities that recover economically are the ones that pursue every available resource with urgency. The ones that wait get left behind.