"There will probably be furloughs for the people that process the claims, which means that they get slowed down and people get their claims processed later and it's already been delayed too much," Pallone told WCBS 880 reporter Jim Smith.
He said grant programs to help homeowners who are under-insured could be cut and money for buyouts could be scaled back.
Pallone: Sequester Could Slow Sandy Aid
"The problem with sequester is it eliminates the good with the bad," Pallone said.
Democratic members of Congress warn of a $2.5 billion cut to the Sandy relief package.
"I think, already, people are not people because everything is taking too long and I think they're just going to get more upset when it takes longer," Pallone added, saying it might take public outcry to force a solution in Washington.
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