Norton Tracks Billions in Unspent Katrina Funds in Hearing (9/29/09)

Norton Tracks Billion in Unspent Katrina Funds in Hearing:

Opening Statement

September 29, 2009

WASHINGTON, DC - Congresswoman Eleanor Holmes Norton (D-DC), chair, the Subcommittee on Economic Development, Public Buildings, and Emergency Management, today in her Subcommittee's "Final Breakthrough on the Billion Dollar Katrina Infrastructure Logjam: How is it Working?" hearing said the flow of funds intended to aid Katrina survivors is getting better, but more improvements are needed. "While things are getting better, that does not mean we cannot or should not endeavor to find ways to speed up and improve the recovery of the Gulf Coast even more," Norton said in her opening statement. "The citizens of the Gulf Coast and the Nation would expect nothing less from us. In today's hearing, as well in its oversight activities, this subcommittee will continue examining how we can do so." Witnesses for the hearing included: Stephen Daniels, Chairman Civilian Board of Contract Appeals; David Garratt, Acting Deputy Administrator, Federal Emergency Management Agency; Charles R. Axton, FEMA Lead, Unified Public Assistance Project Decision Team Gulf Coast Recovery Office, Federal Emergency Management Agency; Paul Rainwater, Executive Director, Louisiana Recovery Authority; Craig Taffaro, President, St. Bernard Parish, Louisiana.

The Congresswoman's full statement is as follows.

Statement of

The Honorable Eleanor Holmes Norton

transportation and infrastructure committee

Subcommittee on economic development, public buildings, and emergency management

"Final Breakthrough on the Billion Dollar Katrina Infrastructure Logjam: How is it Working?"

September 29, 2009

We are pleased to welcome our witnesses to another in a series of hearings our Subcommittee has held to oversee and evaluate the efforts of the Federal Emergency Management Agency (FEMA), as well as the affected state and local governments in the long recovery from Hurricanes Katrina and Rita. Today we will specifically hear about how the new arbitration program mandated in the American Recovery and Reinvestment Act (Recovery Act), as well as other steps by the new leadership at FEMA, has improved the pace and quality of the recovery efforts in the Gulf Coast.

We are pleased that today's testimony in many ways will be different than what we have heard before. Based on the testimony we are going to receive, as well as numerous meetings and discussions that Members and staff have had with officials from all levels of government in the Gulf Coast, it appears that we may have turned a corner in the long recovery from Hurricanes Katrina and Rita. For example, today, Paul Rainwater, Executive Director of the Louisiana Recovery Authority, and no stranger to this hearing room, will testify that things have improved since President Obama took office, and credits the new FEMA leadership team for this effort. It should not go unnoted that Mr. Rainwater is a member of a Republican administration that certainly does not agree with the President on every issue.

While the Subcommittee is pleased that things are improving, these improvements are long overdue. As we will hear today, many of the improvements being implemented are not new ideas, some have been proposed by this Subcommittee for two and a half years, if not longer.

A case in point is H.R. 3247 from the 110th Congress, which this Committee reported and the House passed in October 2007. It contains provisions that specifically address many of the problems identified in the implementation of the public assistance program in the aftermath of these storms. For example, the bill authorizes the FEMA Administrator to include Gulf Coast recovery efforts under the public assistance pilot program authorized by the Post-Katrina Emergency Management Reform Act (P.L. 109-295), increases the Federal in-lieu contribution for alternate projects from the current level of 75 percent to 90 percent, permits the use of third parties to review and expedite public assistance appeals, and allows FEMA to use simplified procedures under which small projects are permitted to proceed on estimates, for projects up to $100,000. The House passed this not once, but twice, as a similar bill passed the House in September 2008. It is unfortunate that the Senate was never able to pass that legislation.

The Subcommittee is also pleased to welcome Judge Stephen Daniels of the Civilian Board of Contract Appeals (CBCA). FEMA has entered into an agreement with the CBCA to implement the new arbitration program. The CBCA's expertise in resolving disputes in Federal construction contracts should prove invaluable. It should not go without saying that the idea to use the CBCA as a third-party to resolve disputes over the Public Assistance program originated in this Subcommittee. However, the idea was met with resistance from FEMA under prior leadership. It is unfortunate that it took the language of the Recovery Act to prod FEMA do to this, especially since it has been our view that FEMA had sufficient existing authority to implement this program or similar programs using third-party dispute resolution.

While things are getting better, that does not mean we cannot or should not endeavor to find ways to speed up and improve the recovery of the Gulf Coast even more. The citizens of the Gulf Coast and the Nation would expect nothing less from us. In today's hearing, as well in its oversight activities, this subcommittee will continue examining how we can do so. We intend to ask pointed questions on how the process is going and how it can be improved. We also intend to look for new tools that FEMA and State and local governments can use. For example, while the arbitration provision in the Recovery Act mandates FEMA administer arbitration for projects exceeding $500,000 it does not prohibit FEMA from offering arbitration for smaller projects. The legislation also does not prohibit FEMA from offering other types of alternate dispute resolution. As I stated earlier, it has been the position of this Subcommittee that FEMA already had the authority to provide for alternate dispute resolution, including arbitration, but the last Administration merely lacked the will to do so.

An appropriate question for the hearing today is whether some of the provisions in H.R. 3247 or other similar proposals might still assist in the recovery from these storms, notwithstanding the fact that the storms occurred over four years ago. For example, are there still communities that could benefit from an increase increases in the Federal in-lieu contribution for alternate projects from the current level of 75 percent to 90 percent, or from increasing the use of simplified procedures under which small projects are permitted to proceed on estimates, for projects from $55,000 to $100,000 or a possibly higher figure?

Again, we thank our FEMA representatives, and our witnesses from the Civilian Board of Contract Appeals and Louisiana, for preparing testimony today to help the subcommittee better understand how and ensure that the recovery efforts in the Gulf Coast continue to improve.