428A Russell Senate Office Building 11:00am EST
Chairman David Vitter
Welcome everyone, and thank you for joining me here today to discuss the very important and ongoing challenges we face in relation to disaster recovery. Natural disasters are indiscriminant and sweeping, affecting life, property, and livelihoods for families and businesses. With this roundtable I hope to highlight the improvements made in disaster recovery efforts in the last decade; discuss what continuing challenges local, state and federal officials still face in the wake of natural disasters; and have a conversation about paths forward for disaster mitigation and response.
As this is its 10th anniversary, I would like to take this opportunity to remember the tens of thousands of families impacted by Hurricane Katrina. Ten years ago this month, we all experienced one of the most devastating, deadly, and costly natural disasters in United States history. Hurricane Katrina caused over 1,200 deaths and $108 Billion of damages. The damages from that year’s hurricanes Rita and Katrina caused some 50,000 people to be unemployed by the second half of 2009. And here we are, ten years later in 2015, and still dealing with Katrina’s impacts on top of the other significant disasters our states have suffered through over the last decade. Between 2008 and 2012, with Hurricanes Gustav, Ike, and Isaac, there was over $44 Billion in damages. And then, on October 29, 2012, Hurricane Sandy devastated the vast majority of the Eastern Coast of the United States. One hundred and thirty one people lost their lives, and 12 states including the District of Columbia were declared major disaster areas. The Disaster Relief Appropriations Act of 2013 provided a $50.7 billion package of disaster assistance largely focused on responding to Hurricane Sandy. The lives lost, exorbitant amount of money spent, and lasting impacts still felt today from these events are highlighted here as the foundation for discussing ways to mitigate these losses in the future and to implement strategies for addressing recovery that get our lives back in order as soon as possible following a disaster.
I witnessed firsthand after Hurricane Katrina both the endearing strength of our communities and the devastating failures of our government in delivering recovery assistance. While businesses came together, willing and able to deliver vital relief, they were turned down by the bureaucracy of government agencies. Immediately following the event, I heard reports of “hellish” shelter conditions at the Superdome and witnessed unacceptably slow response times from the Federal Emergency Management Agency (FEMA); long delays in the delivery of Federal emergency assistance, food, water, radios, and other necessities; failing evacuation systems; and ineffective federal contracting practices. Disaster relief funds either never made it into the hands of those in need, or arrived so late that families and businesses suffered additional, unnecessary losses in the meantime. All of these economic, infrastructure, and operations failures obstructed vital recovery efforts causing delays that would draw out Katrina’s impacts for years afterwards. And these are just the immediate failures of the government’s disaster recovery efforts.
Long-term disaster recovery assistance comes from the Small Business Administration (SBA), whose responsibility is to provide our homeowners, renters, businesses, and non-profits long-term recovery loans that can get these vital community and economic resources back on their feet. After Hurricane Katrina struck Louisiana ten years ago, we learned the hard way what worked and didn’t work as we toiled through years of recovery. After each major disaster since then, we’ve learned that small businesses need extra help to get back on their feet. American small businesses are the backbone of our economy with over 28 million small businesses generating over 65 percent of the net new jobs in America since 1995. They are a driving force of our nation’s growth and workforce. Small businesses in rural communities face a unique set of challenges that make competing with big business significantly more difficult. When disasters hit, small businesses are some of the victims that are hit the hardest and feel the lasting effects the longest. Long-term recovery assistance is vital to ensuring that our small businesses, our jobs, are not lost along with other damages. However, we have seen significant shortcomings with the SBA’s disaster loan programs—including application processing times—agency coordination at almost every step of the way, and continuing challenges for the SBA that are apparent in their ongoing recovery assistance efforts with Sandy.
As Chairman of the Senate Small Business and Entrepreneurship Committee, I am committed to serving small businesses across the country and ensuring that they are afforded the resources and assistance in order to protect themselves from and recover after disasters. This means rigorous oversight of the SBA’s disaster loan programs and extensive examination of economic recovery efforts, agency coordination, and the efficiency of disaster assistance delivery. Small businesses are vital to every community’s economy and serve as the major source of jobs—one great incentive to have folks return after a major disaster—and is why helping them to more quickly recover is one of the most effective and beneficial tactics we can and should take.
Consequently, I have introduced and sponsored numerous pieces of legislation to address these continuing challenges, including the Water Resources Reform and Development Act of 2014 (WRRDA 2014), the Recovery Improvements for Small Entities After Disaster Act of 2015 (RISE After Disaster Act), and the National Disaster Relief Tax Act.
Hurricanes Katrina and Rita in 2005, Ike and Gustav in 2008, and Isaac and Sandy in 2012 have all illustrated the potential cost and consequence of the nation's growing exposure to hurricane-induced coastal flooding and the tens of billions of tax dollars that would likely be spent on compensating flood victims and coastal reconstruction in the aftermath of storms. It is common sense to invest in our infrastructure to protect lives and property, than to lose that life and property and spend billions in relief funds and personal and economic losses after.
What I can commend during the immediate aftermath of Katrina was how on the fifth day after the storm, relief efforts became a full-scale military operation. And with that came a completely different mindset than the bureaucratic one we had been fighting for the previous five days. Clearly of the government agencies, the military’s model is what we need for response efforts on the magnitude of Katrina. This was the mode in which the Army Corps of Engineers (Corps) designed and built the $14.6 billion hurricane protection system in south Louisiana relatively quickly following Katrina. The problem is that the Corps reverts to its “bureaucracy mode” outside of emergencies. We need a no-nonsense “Army mode” corps all the time. To get there, we need to reform the Corps’ bureaucracy; prioritize its work; fund needed projects; and allow state and local partners to take the lead on many projects, which would result in work being done to the same standards but more quickly and economically.
That is why as Ranking Member of the Environment and Public Works Committee last Congress, I passed WRRDA 2014 that was signed into law on June 10, 2014. WRRDA 2014 addresses hurricane and flood related risk reduction while prioritizing ongoing hurricane and storm damage reduction studies that address an imminent threat to life and property, among others. It also takes substantial strides in levee safety; disaster mitigation and coastal restoration; reforming the Corps to address the major inefficiencies and ineffectiveness rooted in their culture and expedites the project delivery process; increase non-federal sponsor involvement; and ensure that our tax dollars are going towards their intended purposes through infrastructure trust funds.
Earlier this year, as Chair of the Small Business Committee, I passed through the Committee with unanimous bipartisan support S.1470, the RISE After Disaster Act of 2015, along with other legislation to address the needs, protection, and recovery of America’s small businesses.
The RISE After Disaster Act reflects a number of things that we learned, and will help future disaster victims recover more quickly and with less red tape from the federal government. Specifically, the bill provides long-term recovery loans to small businesses through community banks when SBA disaster assistance is no longer available. It directs federal agencies to utilize local contractors for response and recovery efforts rather than government contractors from Washington, D.C. and other areas. It provides incentives for innovative firms doing research & development to stay in the disaster-affected area rather than move elsewhere. The bill fast-tracks applications to operate Small Business Investment Company funds in order to drive private investment back into disaster-affected areas. It also reduces excessive paperwork burdens on disaster victims, among other initiatives to get our businesses back up and running.
Last month I introduced the bipartisan National Disaster Relief Tax Act with my colleagues that will provide tax relief for disaster victims across the country that have experienced disasters in recent years, including businesses impacted by the recent Red River flooding and Hurricane Isaac in 2012. Working to prepare businesses for future disasters, the bill also will allow businesses to create natural disaster funds in order to prepare for disaster costs, including insurance.
I hope to focus on some of the improvements that the SBA, FEMA, and other agencies and organizations have made since the tragic events ten years ago, and also explore ways to continue improvements on all fronts of disaster recovery assistance. Joining the discussion today are some of the leading agencies and organizations that are on the frontlines of disaster assistance and recovery with a breadth of experience and insight into the improvements and challenges each agency and organization faces. While I am disappointed that the U.S. Department of Agriculture and the U.S. Forest Service refused to participate in today’s roundtable, I am looking forward to an enthusiastic conversation from the leaders and experts who are here today and take these matters very seriously.
James Rivera is the Associate Administrator for the Small Business Administration’s Office of Disaster Assistance. During his 25 years at the SBA, Mr. Rivera has led several efforts to improve the agency’s disaster operations after hurricanes Katrina, Rita, and Wilma, including development of more efficient loan and underwriting processes, computer upgrades which have resulted in quicker loan disbursements, and other initiatives.
Gerilee Bennett is Deputy Director of the National Disaster Recovery Planning Division at FEMA. She has been leading national disaster recovery planning and exercise initiatives since 2003, including overseeing the implementation of the National Disaster Recovery Framework, and supported disaster assistance operations through major hurricanes since the 1990s, the 2008 Midwest floods, the 2001 World Trade Center attacks, and the 2010 Gulf Coast oil spill.
Russ Paulsen is the Executive Director for nationwide community preparedness and resilience-building programs at the American Red Cross, and joins us with over 25 years of experience leading some of the largest disaster response and recovery efforts in the organization’s history.
William Shear is Director of Financial Markets and Community Investment at the U.S. Government Accountability Office and will be offering invaluable insight into today’s issues having directed substantial bodies of work addressing the SBA, community and economic development programs, and housing finance.
Andrea Deadwyler is the Director of the Credit Programs Group in the Audit Division at the SBA’s Office of the Inspector General. She brings years of experience in oversight and investigations to the table.
Tee Rowe is President and CEO of the America’s Small Business Development Center network which leads nationwide educational assistance programs to strengthen business management and assist entrepreneurs and small businesses owners start and grow businesses, including serving their communities through additional disaster recovery guidance.
I look forward to hearing from all of you on what you see as improvements, what challenges are still ahead, and any recommendations you have for Congress moving forward regarding disaster loan programs, economic recovery, agency coordination, and the efficiency of disaster assistance delivery. Again, thank you all for joining me here today to discuss these important issues.