FEMA Distributes $250M for AI-Powered Counter-Drone Detection

FEMA has begun distributing $250 million to state agencies for counter-drone detection and tracking systems — the first tranche of a $500 million program created to address escalating security threats from unmanned aircraft. A second $250 million round targeting all 56 states and territories opens in FY2027.

The Counter-Unmanned Aircraft Systems (C-UAS) Grant Program, established under the One Big Beautiful Bill Act, represents the federal government's largest investment in civilian drone detection infrastructure. For technology companies and state security agencies alike, it signals a massive new market for AI-driven surveillance and detection systems.

What the First Round Funds

The 12 initial awards prioritize states hosting 2026 FIFA World Cup events and the National Capital Region. Funding covers five categories: planning and risk assessment, personnel and organizational capacity, detection equipment, training, and field exercises.

The equipment category is where AI enters the picture. Eligible purchases include radar systems, electro-optical and infrared cameras, radio frequency detection arrays, acoustic sensors, and Remote ID receivers — technologies that increasingly rely on machine learning algorithms to distinguish threatening drones from benign air traffic in real time.

States must distribute 97% of their awards to local, tribal, and territorial subrecipients, retaining only 3% for administration. An exception allows up to 20% retention for statewide equipment purchases benefiting law enforcement.

The FY2027 Round Is the Big One

While the first round was limited to priority jurisdictions, the FY2027 cycle will make the remaining $250 million available to all states and territories through an estimated 56 awards. State Administrative Agencies that missed the first round should begin building their investment justifications and operational needs assessments now.

Local law enforcement, emergency management agencies, and critical infrastructure operators should coordinate with their State Administrative Agency to position as subrecipients.

Preparing Your Subrecipient Proposal

The performance period runs through September 30, 2028. Agencies seeking subrecipient funding should document specific UAS threat scenarios, identify detection technology needs, and align proposals with their state's broader homeland security strategy. Granted tracks federal security and technology grant opportunities to help agencies identify relevant funding as the FY2027 cycle approaches.