Congress created the FEMA-run program in 1968 because few private insurers cover flood damage.
The US$2 billion FEMA already has spent went to providing shelter, restoring power and meeting other immediate needs.
FEMA’s disaster relief fund still has about US$4.3 billion, enough to pay for emergency response efforts into early spring, officials said.
Sandy is the most costly natural disaster since Hurricane Katrina in 2005.
Northeast lawmakers have complained that while it took Congress just 10 days to approve about US$50 billion in Katrina aid, additional money for Sandy victims has not been forthcoming in more than two months.
The storm damaged or destroyed more than 72,000 homes and businesses in New Jersey. In New York, 305,000 housing units were damaged or destroyed and more than 265,000 businesses were disrupted, officials have said.