Rescue workers on Wednesday carried a body from the rubble of a village destroyed by last week’s earthquake and tsunami in Japan. The disaster is raising concerns about U.S. disaster preparations. (Paula Bronstein/Getty Images)

The agency, responsible for coordinating the government’s emergency response plans, also needs more experienced personnel to deal with a growing workload as state and local governments trim emergency management budgets and should upgrade its computer systems, according to a report by Department of Homeland Security Inspector General Richard L. Skinner.

His report will be the topic of a Senate hearing set to review how FEMA has adapted since its widely-panned response to Hurricane Katrina in 2005.

The Senate Homeland Security and Governmental Affairs Committee originally scheduled the hearing last fall, but postponed it until this week — coincidentally just days after a 9.0-magnitude earthquake rocked Japan and raised concerns about preparedness efforts in the United States.

Last week’s earthquake lends “a sense of urgency” to the review, according to committee chairman Sen. Joseph I. Liberman (I-Conn.).

“Japan was considered the gold standard of earthquake preparedness but even so, this earthquake...and the waves of disaster it set off, have exceeded the country’s preparations,” according to Lieberman’s prepared remarks.

Five years after Katrina, “We are better prepared for a catastrophe than we have ever been,” Lieberman will say. “But the epic disaster in Japan reminds us that FEMA must continue to improve.”

The agency spends about $4.3 billion annually on disaster response, mostly by distributing money through its assistance programs. Many of its roughly 4,000 employees are “dual-hatted,” meaning that “As more disasters are declared and disasters stay open for longer periods of time, more FEMA staff resources are diverted from planning and preparedness efforts,” the report said.

Skinner’s report — completed last fall in time for the originally-scheduled hearing — credits FEMA for gaming out several potential natural disaster scenarios across the country. Since 2008, it has reviewed plans for major hurricanes in Hawaii and Florida, typhoons in Guam, and earthquakes in the San Francisco Bay Area, Southern California, Norhwest Nevada and along the New Madrid fault lines in the Midwest.

Between 2005 and 2010, FEMA spent $218 million on National Level Exercises, or dress rehearsals for potential natural or man-made disasters that bring together officials at the federal, state and local levels to determine what might occur in a real-world scenario.

Obama administration officials last year canceled plans to test a nuclear bomb explosion scenario in Las Vegas amid concerns by business groups there, but the agency is still planning a major exercise in mid-May that will rehearse the potential response and aftermath of a major earthquake across eight midwestern states in the New Madrid seismic zone.

Some state and local officials — including former Arizona Gov. Janet Napolitano, the current Homeland Security secretary — have criticized the national exercises as a costly distraction that cause“exercise fatigue” among officials who should prepare instead for surprise scenarios.

But such disaster planning remains “a top priority” of FEMA Administrator W. Craig Fugate , according to agency spokesman Brad Carroll. “We recognize that in large-scale disasters, government cannot do it alone, which is why we are constantly working with the entire federal family, state, local and tribal governments, faith-based and non-profit organizations, and especially the public to plan and prepare, so we can respond as one team,” he said. Many of the agency’s top leaders, including Fugate, are experienced emergency managers with state and local-level experience, Carroll said.

(In hopes of raising awareness about May’s national exercise, the eight states are planning next month to hold “The Great Central U.S. Shake Out,” modeled on similar “shake out” rehearsals in California. Officials are encouraging families, schools, universities, private businesses and churches to participate and to draft personal earthquake preparedness plans. More than 1 million individuals and organizations are planning to participate, according to organizers.)

The report also credits FEMA for holding multiple emergency communication exercises with other federal agencies, including the U.S. Secret Service, Transportation Security Administration and the military. It recently participated in an exercise simulating potential communications problems following an earthquake in the Salt Lake City area. Participants included the military, other Homeland Security agencies, the U.S. Forest Service and state and local officials, according to the report.

Notably however, nowhere in the report is there mention of FEMA’s preparations for a possible nuclear reactor meltdown — the scenario causing the most fear this week as the world watches Japan attempt to stave off disaster at six of its nuclear reactors.

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