Communities across the country are increasingly at risk of being affected by natural and environmental disasters. The Public Assistance Grant Program (PA Program) administered by the Federal Emergency Management Agency (FEMA) is available for states and communities that have received a major or emergency disaster declaration. For example, following Hurricane Katrina, there have been ten federal declared disasters in Louisiana alone with federal obligated costs of about $2.1 billion (CPI adjusted to 2011dollars). The PA program was recently amended and allows FEMA to implement Public Assistance Alternative Procedures (PAAP) Pilot Programs. In this research we focus on the Debris Management Pilot Program. FEMA is authorized to provide different set of incentives to local governments that have a debris management plan in place. Two of the initial and most important aspects of disaster response and recovery operations are the removal and disposal of debris from the disaster –affected area. In this research we use a System Dynamics model to better visualize the effect of different debris management policies on the financial wealth of local governments.