Private Nonprofit (PNP) Eligibility for FEMA Public Assistance

Private nonprofit (PNP) organizations are the main category of nongovernmental applicant that can receive FEMA Public Assistance (PA) funding directly. FEMA's published policy — the Public Assistance Program and Policy Guide, Version 5 (PAPPG v5) — applies a three-part test: the organization must have been an established PNP organization, it must have owned or operated an eligible PNP facility at the time of the incident period, and that facility must provide an eligible service. All three criteria must be met (PAPPG v5, Chapter 3, Section V; 44 CFR § 206.222(b)).

The service test carries the most weight. Eligible services split into critical services and noncritical, but essential social services, and that split determines whether the PNP must first apply for a U.S. Small Business Administration (SBA) disaster loan before FEMA will fund permanent repair work. This guide walks through each test, then the SBA rule and the documentation FEMA expects with a PNP's Request for Public Assistance (RPA). For the framework that applies to all applicants, see FEMA PA eligibility basics.

Who qualifies as a PNP organization

Under 44 CFR § 206.221(f), a PNP organization is a nongovernmental agency or entity that currently has either (1) an effective IRS ruling letter granting tax exemption under section 501(c), (d), or (e) of the Internal Revenue Code, or (2) satisfactory evidence from the state that it is a non-revenue-producing nonprofit organized or doing business under state law. PAPPG v5 adds that the IRS ruling letter must have been in effect as of the declaration date.

An organization not required to obtain 501(c)(3) or state tax-exempt status may instead provide articles of association, bylaws, or other documents showing it is an organized entity, plus a certification that it complies with Internal Revenue Code section 501(c)(3) and state-law requirements. For-profit entities are never eligible PA applicants, although government entities may contract with them to carry out eligible emergency work and then seek reimbursement themselves.

Eligible PNP facility types

44 CFR § 206.221(e) defines a PNP facility as an educational, utility, emergency, medical, or custodial care facility (including facilities for the aged or disabled), other facilities providing essential governmental-type services to the general public, and such facilities on Indian reservations. The Stafford Act § 102(11) definition adds center-based childcare, irrigation, and rehabilitational facilities, and its subparagraph (B) sweeps in facilities that provide essential social services to the general public — expressly including museums, zoos, performing arts facilities, community arts centers, community centers, libraries, homeless shelters, senior citizen centers, rehabilitation facilities, shelter workshops, food banks, broadcasting facilities, and houses of worship. The statute states that no house of worship may be excluded because leadership or membership is limited to people who share a religious faith or practice, and § 406(a)(3)(C) makes religious facilities eligible without regard to religious character or primary religious use.

The PNP may own or operate the facility (44 CFR § 206.222(b)), but the facility must be owned and operated by an organization meeting the PNP definition (44 CFR § 206.223(b)). Where one eligible PNP leases to another eligible PNP that provides an eligible service, whichever party has the legal responsibility to maintain the facility is the eligible applicant. FEMA evaluates each building independently, even when multiple buildings sit on the same grounds.

Critical vs. non-critical services

The Stafford Act § 406(a)(3)(B) defines critical services to include power, water (including water provided by an irrigation organization or facility), sewer, wastewater treatment, communications (including broadcast and telecommunications), education, and emergency medical care. PAPPG v5 (Table 3) organizes eligible critical services into four groups:

• Education — primary or secondary education as determined under state law, and higher-education institutions that admit students with a high school diploma or equivalent, are legally authorized to teach beyond the secondary level, award qualifying degrees or one-year occupational training, and are accredited by a nationally recognized agency.
• Emergency medical — diagnosis or treatment of mental or physical injury or disease, in settings such as hospitals, clinics, dialysis facilities, hospices, nursing homes, long-term care and outpatient facilities, and rehabilitation centers.
• Utility — electric power generation, transmission, and distribution; telecommunications; municipal water treatment and distribution; sewer and wastewater collection and treatment; and irrigation that supplies drinking water, fire suppression, or electricity generation.
• Emergency services — ambulance, fire protection, rescue, and public broadcasting that monitors, receives, and distributes Emergency Alert System communications.

Administrative and support facilities essential to providing a critical service are also eligible — for example kitchens, dormitories, storage, parking lots, access roads, administrative offices, school gyms, and playgrounds.

Noncritical, essential social services (Table 4) include community centers, center-based childcare, custodial care, day care for individuals with disabilities or access and functional needs, alcohol and drug treatment, assisted living, food banks, low-income housing, residential services for individuals with disabilities and for families of domestic abuse, homeless shelters, houses of worship, religious instruction, libraries, museums, senior citizen centers, zoos, and performing arts centers. One caution: with the exception of custodial care facilities and museums, administrative and support facilities for noncritical services are ineligible.

A noncritical facility must also serve the general public. PAPPG v5 requires that facility use not be limited to a set number of individuals, a defined group with a financial interest in the facility (such as a condominium association), certain classes of individuals, or an unreasonably restrictive geographic area; that access not be restricted by gates or security systems intended to keep the public out; and that any membership fees be nominal, waived on inability to pay, not large enough to exclude a significant portion of the community, and consistent with similar facilities. Facilities whose restrictions are inherent to their nature — senior centers, center-based childcare, custodial care, rehabilitation, educational facilities, and houses of worship that limit membership by faith — still count as serving the general public.

Ineligible services (Table 5): facilities established or primarily used for political, athletic, recreational, or vocational activities, conferences, or retreats are ineligible, as are recreation, athletic training, advocacy or lobbying groups not directly providing health services, job counseling, camps, cemeteries, docks and piers, land reclamation, irrigation solely for agriculture, and grounds at museums and historic sites, among others.

The SBA loan requirement for non-critical PNPs

Under Stafford Act § 406(a)(3)(A), FEMA may fund repair or replacement of a PNP facility only if the facility provides critical services, or the owner or operator has applied for an SBA disaster loan under section 7(b) of the Small Business Act and has either been determined ineligible or obtained the maximum loan amount the SBA determines the facility is eligible for.

PAPPG v5 implements this as follows. FEMA funds eligible debris removal and emergency protective measures for noncritical PNP facilities without any SBA step. But before FEMA funds permanent work, a PNP must apply to the SBA and receive a determination for facilities that provide only noncritical services, or that are mixed-use facilities where the damaged portion provides entirely noncritical services. FEMA then funds only the permanent work costs an SBA loan will not cover. No SBA application is needed for facilities providing critical services — even if they also provide non-critical services.

Type of services provided	Emergency work	Permanent work
Critical services	SBA loan application not required	SBA loan application not required
Non-critical but essential social services	SBA loan application not required	SBA loan application required

Practical points from PAPPG v5: SBA disaster loans are available up to $2 million to qualified businesses and most private nonprofits, covering losses not fully covered by insurance or other sources. Both FEMA and the SBA have application deadlines — apply to both as early as possible. If the PNP misses the SBA deadline, including any SBA-approved extension, permanent work becomes ineligible for PA funding. If the PNP declines a loan, PA funding is limited to costs the loan would not have covered — and this applies even when the PNP cannot accept the loan's terms (for example, a collateral requirement) and the SBA denies it. Neither FEMA nor the SBA may duplicate insurance proceeds; see insurance and duplication of benefits.

Mixed-use and shared facilities

For facilities providing both eligible and ineligible services, eligibility turns on primary use: the use to which more than 50 percent of the physical space is dedicated, evaluated across the entire structure (common spaces such as hallways and bathrooms are excluded from the calculation). If 50 percent or more of the space serves ineligible uses, the entire facility is ineligible. If the facility is eligible, FEMA prorates funding by the percentage of space dedicated to eligible services, and the applicant must restore the entire facility to receive funding for the eligible portions. Where a facility mixes critical and eligible noncritical services, FEMA does not run a primary-use calculation between those two categories — only between eligible and ineligible uses. A shared facility is eligible only when the PNP applicant owns more than 50 percent of it and dedicates more than 50 percent of the space to eligible services.

Required documentation for a PNP RPA

PAPPG v5 Table 6 lists what a PNP should submit with its Request for Public Assistance:

• All PNP applicants: the IRS ruling letter in effect on the declaration date (section 501(c), (d), or (e)); or state documentation substantiating non-revenue-producing nonprofit status; or, if exempt from both, organizing documents plus a compliance certification.
• Legal responsibility: proof of ownership (deed, title, bill of sale, mortgage records, property tax bill, or a real property insurance policy) — or, for leased facilities, a lease showing legal responsibility to repair incident-related damage.
• Services: a list of services provided in the damaged facility, when, and to whom.
• Membership organizations: who is allowed membership, the fee policy, and the policy for waiving fees.
• Childcare facilities: proof of recognition as a licensed childcare facility by the relevant state agency.
• Schools: accreditation or state recognition as a provider of elementary or secondary education (state requirements vary — documentation can range from accreditation records to attendance-law compliance, budgets, and curricula).
• Mixed-use facilities: proof of established purpose, such as IRS documentation, pre-incident charter and bylaws, or evidence of routine day-to-day use.

For project-level records that apply once work begins, see the PA documentation checklist.

Emergency work is narrower for PNPs

For eligible PNPs, emergency protective measures are generally limited to activities that prevent damage to an eligible facility and its contents (PAPPG v5, Chapter 7). Emergency services to the community are the legal responsibility of government entities, so when a PNP performs them at the request of — and certified by — the responsible government, FEMA funds the work through that government as the applicant. Exceptions where FEMA reimburses a PNP directly include patient evacuation from PNP medical and custodial care facilities, urgently needed essential components such as a PNP hospital emergency room or a PNP sewage or water treatment plant, and PNP volunteer fire departments operating under an established agreement that certifies their legal authority to serve designated areas. See Category B: emergency protective measures for the broader rules.