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428A Russell Senate Office Building, Washington, DC 10:30 a.m. EDT

Chairman David Vitter

Good morning, and thank you for joining me for today’s Senate Committee on Small Business and Entrepreneurship hearing to discuss the federal response and recovery efforts to help the Louisiana communities that are suffering from the devastating flood event last month.

I want to begin by offering my condolences to the families of the 13 people who tragically died during this disaster. My thoughts and prayers are with them, as well as the thousands who lost everything in the wake of what the American Red Cross, FEMA, and the White House are calling the most extensive single natural disaster since Hurricane Sandy.

This hearing is an important step to highlight the magnitude of this disaster in the Senate. It is unfortunate, but the reality is that this event was severely underreported across the country.

To put it in perspective, over the course of 36 hours, severe storms generated up to 30 inches of rain, which triggered a thousand-year flood event, according to FEMA. State officials estimate this caused nearly $8.7 billion in damages. Shortly after the flood, President Obama declared a major disaster declaration for 22 parishes in South Louisiana.

So far, there have been over 142,000 registrations with FEMA for individual household assistance. This compares to a very significant flood event in Northern and Central Louisiana last March, which had 40,000 registrations. It also surpasses the serious flooding in South Carolina last year that had over 26,000 registrations.

Compared to Hurricane Ike in 2008, which saw over 120,000 registrations, over $532 million in individual household programs claims that were approved, and cost $29 billion in property damage – the cost the Louisiana flooding in August has already exceeded those numbers.

Without federal relief, and facing substantial rebuilding challenges and a potential foreclosure crisis, families will be forced to either move to other areas of the country or occupy severely damaged homes in communities that will inevitably struggle to come back without federal assistance —similar to what we saw in the aftermath of Hurricane Katrina. Louisiana will be unable to recover alone, and will need substantial assistance and federal aid if it is to rebuild.

Earlier this week in a Senate Banking Committee hearing, I asked the Deputy Associate Administrator of FEMA Roy Wright to comment on the significance of the event. He stated that it was the 4th worst disaster he had seen over the last 12 years, only behind Hurricanes Katrina, Sandy, and Ike.

It is quite possible that when it’s all said and done, this disaster could jump Ike in terms of damage. One major issue that makes this event particularly devastating is that of the 130,000 homes that were damaged, only 28,700 NFIP claims have been submitted.

This is because many highly concentrated areas impacted by the flood are actually located way outside of any sort of flood-designated zone, and the owners are not required to have flood insurance.

In the days and weeks following the severe flooding, the SBA worked quickly to set up Business Recovery Centers in the affected parishes in order to verify and approve millions in low-interest disaster loans during the first two weeks of the disaster.

In fact, the first SBA Business Recovery Center was actually up and running in Baton Rouge before a FEMA disaster recovery center was set up in the parish.

This is important because approximately 40% of small businesses will close permanently if they close their doors – even for 1 day – after a natural disaster. Louisiana’s small businesses make up 97.3% of all employers in the state and employ nearly 1 million Louisianians.

Additionally, SBA streamlined the loan process to approve and verify loans so that eligible homeowners and business owners can start the recovery process as quickly as possible.

I also want to touch on the first responders who saved thousands of lives during the flood. This not only includes the many brave law enforcement officers and members of the National Guard, but also the citizen volunteers, affectionately known in the state as the “Cajun Navy” and “Cajun Army.”

These volunteers helped rescue an estimated 30,000 people who were stranded in their homes and cars when the water was rising. They also helped to gut houses and find resources for families in need.

I would like the Committee to note that the FEMA Administrator Craig Fugate chose not to participate in this hearing. It is unfortunate and disappointing that the 4th, possibly the 3rd biggest disaster in the last 12 years, does not warrant his attendance here today.

I invited Administrator Fugate to attend this hearing multiple times and have received varying excuses as to why he cannot attend. First, the timing was not good because of ongoing response efforts. Secondly, he was monitoring storms heading towards the gulf and FEMA’s “hurricane posture” would prevent him from attending. Third, he was he was scheduled to be away traveling in West Virginia.

Administrator Fugate’s excuses are unacceptable. This disaster is hurting real people and affecting actual communities. It has been over a year since the Administrator has testified before a Senate committee. It’s been over two years since he’s testified before a Senate committee that wasn’t the Appropriations Committee.

The Louisiana people deserve better from FEMA and deserve to have the Administrator’s attention. This hearing would have been a great opportunity to make things right and show people that FEMA is sincere about managing emergencies and to explain in detail the struggle that many hardworking Louisianians are going through after one of America’s worst natural disasters since Hurricane Sandy.

Wednesday night, the White House sent a letter to leaders and appropriators in the Senate and House to urge them to provide additional funding for the state’s unmet needs, including housing and infrastructure assistance.

Specifically, he requested an emergency supplemental of $2.6 billion in Community Development Block Grant funding, which is very important for long-term recovery.

The overwhelming nature of this disaster pushed Louisiana’s state, parish, and local resources to the limit. Clearly, no state has the resources to address the significant amount of unmet need from this type of disaster without federal assistance.

The Louisiana delegation is working together to address the major unmet needs in the state, including CDBG funds, investments in Comite and Amite river projects, SBA technical assistance funding, Social Services Block Grant funding, along with flood management and infrastructure funding.

Now, let’s get today’s conversation started. Again, I’d like to thank everyone for being here today and look forward to our discussion.