[House Hearing, 109 Congress]
[From the U.S. Government Publishing Office]



 
                       EMERGENCY HOUSING NEEDS IN
                        THE AFTERMATH OF KATRINA

=======================================================================

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                   HOUSING AND COMMUNITY OPPORTUNITY

                                 OF THE

                    COMMITTEE ON FINANCIAL SERVICES

                     U.S. HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             FIRST SESSION

                               __________

                           SEPTEMBER 15, 2005

                               __________

       Printed for the use of the Committee on Financial Services

                           Serial No. 109-54



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                             WASHINGTON: 2006        

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                 HOUSE COMMITTEE ON FINANCIAL SERVICES

                    MICHAEL G. OXLEY, Ohio, Chairman

JAMES A. LEACH, Iowa                 BARNEY FRANK, Massachusetts
RICHARD H. BAKER, Louisiana          PAUL E. KANJORSKI, Pennsylvania
DEBORAH PRYCE, Ohio                  MAXINE WATERS, California
SPENCER BACHUS, Alabama              CAROLYN B. MALONEY, New York
MICHAEL N. CASTLE, Delaware          LUIS V. GUTIERREZ, Illinois
PETER T. KING, New York              NYDIA M. VELAZQUEZ, New York
EDWARD R. ROYCE, California          MELVIN L. WATT, North Carolina
FRANK D. LUCAS, Oklahoma             GARY L. ACKERMAN, New York
ROBERT W. NEY, Ohio                  DARLENE HOOLEY, Oregon
SUE W. KELLY, New York, Vice Chair   JULIA CARSON, Indiana
RON PAUL, Texas                      BRAD SHERMAN, California
PAUL E. GILLMOR, Ohio                GREGORY W. MEEKS, New York
JIM RYUN, Kansas                     BARBARA LEE, California
STEVEN C. LaTOURETTE, Ohio           DENNIS MOORE, Kansas
DONALD A. MANZULLO, Illinois         MICHAEL E. CAPUANO, Massachusetts
WALTER B. JONES, Jr., North          HAROLD E. FORD, Jr., Tennessee
    Carolina                         RUBEN HINOJOSA, Texas
JUDY BIGGERT, Illinois               JOSEPH CROWLEY, New York
CHRISTOPHER SHAYS, Connecticut       WM. LACY CLAY, Missouri
VITO FOSSELLA, New York              STEVE ISRAEL, New York
GARY G. MILLER, California           CAROLYN McCARTHY, New York
PATRICK J. TIBERI, Ohio              JOE BACA, California
MARK R. KENNEDY, Minnesota           JIM MATHESON, Utah
TOM FEENEY, Florida                  STEPHEN F. LYNCH, Massachusetts
JEB HENSARLING, Texas                BRAD MILLER, North Carolina
SCOTT GARRETT, New Jersey            DAVID SCOTT, Georgia
GINNY BROWN-WAITE, Florida           ARTUR DAVIS, Alabama
J. GRESHAM BARRETT, South Carolina   AL GREEN, Texas
KATHERINE HARRIS, Florida            EMANUEL CLEAVER, Missouri
RICK RENZI, Arizona                  MELISSA L. BEAN, Illinois
JIM GERLACH, Pennsylvania            DEBBIE WASSERMAN SCHULTZ, Florida
STEVAN PEARCE, New Mexico            GWEN MOORE, Wisconsin,
RANDY NEUGEBAUER, Texas               
TOM PRICE, Georgia                   BERNARD SANDERS, Vermont
MICHAEL G. FITZPATRICK, 
    Pennsylvania
GEOFF DAVIS, Kentucky
PATRICK T. McHENRY, North Carolina

                 Robert U. Foster, III, Staff Director


           Subcommittee on Housing and Community Opportunity

                     ROBERT W. NEY, Ohio, Chairman

GARY G. MILLER, California, Vice     MAXINE WATERS, California
    Chairman                         NYDIA M. VELAZQUEZ, New York
RICHARD H. BAKER, Louisiana          JULIA CARSON, Indiana
PETER T. KING, New York              BARBARA LEE, California
WALTER B. JONES, Jr., North          MICHAEL E. CAPUANO, Massachusetts
    Carolina                         BERNARD SANDERS, Vermont
CHRISTOPHER SHAYS, Connecticut       STEPHEN F. LYNCH, Massachusetts
PATRICK J. TIBERI, Ohio              BRAD MILLER, North Carolina
GINNY BROWN-WAITE, Florida           DAVID SCOTT, Georgia
KATHERINE HARRIS, Florida            ARTUR DAVIS, Alabama
RICK RENZI, Arizona                  EMANUEL CLEAVER, Missouri
STEVAN, PEARCE, New Mexico           AL GREEN, Texas
RANDY NEUGEBAUER, Texas              BARNEY FRANK, Massachusetts
MICHAEL G. FITZPATRICK, 
    Pennsylvania
GEOFF DAVIS, Kentucky
MICHAEL G. OXLEY, Ohio



                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    September 15, 2005...........................................     1
Appendix:
    September 15, 2005...........................................    59

                               WITNESSES
                      Thursday, September 15, 2005

Alvarez, Henry A., III, President and CEO, San Antonio Housing 
  Authority, San Antonio, TX, testifying on behalf of National 
  Association of Housing and Redevelopment Officials.............     8
Beamon, Clanton, Executive Director, Delta Housing Development 
  Corporation, Indianola, MS, testifying on behalf of the 
  National Rural Housing Coalition...............................    37
Brodsky, Jeffrey I., President, Related Management Company, LLC, 
  New York City, NY, testifying on behalf of the National Multi 
  Housing Council and National Leased Housing Association........    40
Daly, Sharon M., Senior Advisor for Public Policy, Catholic 
  Charities USA..................................................    10
Huey, J.K., Senior Vice President, IndyMac Bank, Pasadena, CA, 
  testifying of behalf of the Mortgage Bankers Association.......    12
Kennedy, Judith A., President and CEO, National Association of 
  Affordable Housing Lenders.....................................    42
Miller, Kay, President, T.A. Miller, Inc. and Tra-Dor, Inc. 
  Management, Shreveport, LA, testifying on behalf of the Council 
  for Affordable and Rural Housing...............................    14
Norris, Michelle, Senior Vice President of Development, National 
  Church Residences, testifying on behalf of the American 
  Association of Homes and Services for the Aging................    44
Roberson, David A., President and CEO, Cavalier Homes, Inc., 
  Addison, AL, testifying on behalf of Manufactured Housing 
  Institute and the Manufactured Housing Association for 
  Regulatory Reform..............................................    15
Roman, Nan P., President, National Alliance to End Homelessness..    17
Thompson, Barbara, Executive Director, National Council of State 
  Housing Agencies...............................................    19
Wilson, David F., Homebuilder, Ketchum, ID, President, National 
  Association of Home Builders...................................    20

                                APPENDIX

Prepared statements:
    Ney, Hon. Robert W...........................................    60
    Brown-Waite, Hon. Ginny......................................    62
    Alvarez, Henry A., III.......................................    63
    Beamon, Clanton..............................................    73
    Brodsky, Jeffrey I...........................................    83
    Daly, Sharon M...............................................    94
    Huey, J.K....................................................   122
    Kennedy, Judith A............................................   139
    Miller, Kay,.................................................   149
    Norris, Michelle.............................................   153
    Roberson, David A............................................   164
    Roman, Nan P.................................................   170
    Thompson, Barbara............................................   175
    Wilson, David F..............................................   179

              Additional Material Submitted for the Record

Miller, Hon. Gary:
    Ellen Lee, City of New Orleans, prepared statement...........   198
    National Low Income Housing Coalition, letter, September 13, 
      2005.......................................................   206
    National Association of Realtors, prepared statement.........   210
Alvarez, Henry A., III:
    Written response to question from Hon. Barney Frank..........   216


                       EMERGENCY HOUSING NEEDS IN
                        THE AFTERMATH OF KATRINA

                              ----------                              


                      Thursday, September 15, 2005

             U.S. House of Representatives,
                            Subcommittee on Housing
                         and Community Opportunity,
                           Committee on Financial Services,
                                                   Washington, D.C.
    The subcommittee met, pursuant to call, at 10:03 a.m., in 
Room 2128, Rayburn House Office Building, Hon. Robert Ney 
[chairman of the subcommittee] presiding.
    Present: Representatives Ney, Miller of California, Brown-
Waite, Harris, Pearce, Davis of Kentucky, Waters, Carson, Lee, 
Sanders, Scott, Cleaver, Green, Frank, Gonzalez, and Clay.
    Chairman Ney. [Presiding.] The committee will come to 
order.
    I would ask unanimous consent that our colleagues, 
Congressman Aderholt of Alabama and Congressman Gonzalez of 
Texas, be permitted to participate in today's hearing. Without 
objection, the two Members are more than welcome to be 
participating in today's hearing.
    Also, I would add that also Congressman Lacy Clay of 
Missouri, who is a member of the full committee but not the 
subcommittee, should also participate. Without objection, he is 
also added.
    I am going to make my opening statement horrifically brief 
because we want to hear from you. Members are welcome to have 
opening statements, but at some point in time when members come 
in, we will just go ahead straight on with it.
    This morning, the Subcommittee on Housing and Community 
Opportunity meets to continue our discussion on the crucial 
housing needs in the aftermath of Hurricane Katrina along the 
Louisiana, Alabama, and Mississippi Gulf Coasts.
    Federal and local governments now face the huge task of 
coordinating the relocation of thousands of individuals, which 
is one of the discussions, and also what to do with families in 
the immediate area whose lives have been uprooted due to the 
Hurricane Katrina situation.
    Last week, we had a meeting where I brought together a 
large group of people from across the housing spectrum to begin 
discussing how best to respond. I think the meeting was 
productive. We had participation by Congressman Barney Frank, 
the ranking member of the full committee, and also our ranking 
member of the subcommittee, Congresswoman Waters of California, 
and Mr. Miller and other members that came to that. I think it 
was a good meeting to have.
    According to the Department of Housing and Urban 
Development, there are 436,800-some units of HUD-assisted 
housing in the hurricane-affected region. This number includes 
15,500 units of elderly housing and 2,500 units of housing for 
the persons who have disabilities in the Gulf Coast area.
    So I think this hearing is very important so that we can 
see how we can help individuals in the entire Gulf area for the 
terrible problem that they are into.
    With that, I am going to yield to the ranking member.
    [The prepared statement of Hon. Robert W. Ney can be found 
on page 60 in the appendix.]
    Ms. Waters. Thank you very much, Mr. Chairman.
    I appreciate very much the tremendous work that you have 
done since Hurricane Katrina. In particular, I am appreciative 
of the roundtable that you pulled together where we had housing 
advocates and others related to the housing industry sharing 
with us their expertise and their opinions about how we can 
move very quickly to deal with the housing needs of all of the 
displaced victims in the Gulf region, the victims of Hurricane 
Katrina.
    As you know, Mr. Chairman, I visited the area and witnessed 
a lot of the devastation. I was in New Orleans and Baton Rouge 
and New Iberia, Andalusia, Lafayette, and Alexandria.
    More than anything, the temporary shelters that have been 
established should be simply that: temporary. We have to get 
people out of these shelters and into what I call transitional 
housing. And then, of course, we need to build permanent 
housing. This is an awesome task that must be done.
    I am very appreciative that you are in the role that you 
are in, Mr. Chairman, because I know about your knowledge in 
this area and your concern for the housing needs, not only of 
the people of the Gulf region, but for all of the people of 
this country.
    So I would simply say that the information that we will get 
today will be very helpful to us, but our challenge is to move 
and move quickly. Someone said it is a test of Congress's 
ability to seize the opportunity to meet these needs.
    So I anxiously await the testimony for today, but more than 
that I think, Mr. Chairman, if anybody can lead us to get this 
done quickly, you certainly can. So I am pleased and delighted 
to be here with you today, and I yield back the balance of my 
time.
    Chairman Ney. I want to thank the gentlelady for her 
comments.
    Mr. Miller?
    Mr. Miller of California. Thank you, Chairman Ney.
    We had a very good hearing last week, as you said, but the 
State and local governments are still trying to deal with the 
effects of the hurricane in that region. We have about 1 
million people displaced, with 163,000 people without homes 
that are in shelters and stuff. This is going to provide quite 
a challenge, let's say, for the Federal Government dealing with 
the private sector in partnership in dealing with this issue. 
We are going to have some huge problems.
    Cement was a shortage before this occurred. Plywood, 
softwood, lumber are just in short supply. So when the impact 
of this is really felt in trying to rebuild, trying to provide 
the housing we need out there, this is going to be an 
insurmountable challenge. I think many factions in the building 
industry it is going to face some issues that we have not faced 
in recent history. That is because of the magnitude of this. We 
faced shortages in the past and we have always been able to 
somewhat deal with them, but not to this magnitude.
    I am looking forward to the testimony today. We have 90,000 
square miles impacted. That is an incredible amount of impact 
on this country. The needs, we do not really know what they 
are. That is why this hearing is important, to determine what 
those needs are. We are hearing from the private sector because 
we have to work with the private sector. You are going to have 
to do this. We are going to have to work with you in doing 
this. The Government cannot handle it without the private 
sector's involvement.
    So that is why I applaud Chairman Ney for calling this 
hearing today to again better ascertain what our needs are 
going to be, what part we have to play, and what part we are 
going to have to partnership with the private sector. I thank 
you.
    I would like to also include the statement by the National 
Association of Realtors into the record today, without 
objection.
    Chairman Ney. Without objection.
    Mr. Miller of California. Thank you.
    Chairman Ney. Thank you.
    And also, the statement of Ellen Lee from the City of New 
Orleans, who had to return their today, and a letter from the 
National Low-Income Housing Coalition to be submitted for the 
record, if there are no objections.
    The gentleman from Massachusetts, Mr. Frank?
    Mr. Frank. Thank you, Mr. Chairman.
    I join the ranking member of the subcommittee in expressing 
our appreciation for your active role here.
    I will say, as the ranking member of the full committee, I 
am very proud that people often comment that the chairman of 
the committee and I get along very well on a lot of issues, 
although there are real differences. What we try to show is 
that you can both have differences and pursue them in a 
respectful way, and then collaborate in other areas. The 
chairman and ranking member of this subcommittee have also set 
a model, I think, for the House.
    In fact, a lot has been done in the housing area, not 
nearly as much as we would like, but more has been done than 
people realize, partly because they do it together and it is 
not controversial. And coverage is generated in this society 
not by the inherent importance of things, but by their 
controversial nature.
    Obviously, we now have a lot to do here. There is clearly 
agreement on increasing the number of vouchers. One of the 
things I want to stress, and I believe this committee will feel 
this very strongly, the vouchers have to be additional 
vouchers. We already have problems with long waiting lists. We 
have problems in other cities. I was glad to see that our 
Senate counterpart Senator Sarbanes moved for additional 
vouchers. I think that has to be an absolute situation, that 
any vouchers here be additional.
    You then would also avoid the problem of what happens if 
you simply put this into the existing pool and who gets what 
priority. Nothing would be more divisive to this country at 
this time than to have the people who were disadvantaged by 
this hurricane go compete with other disadvantaged people 
elsewhere in the country. So we are talking about, I hope, 
additional vouchers.
    Secondly, for those who have been critical of the voucher 
program, I guess we are going as a Nation from having a 
situation in which some people were criticizing vouchers to the 
mantra being where were they when we needed them, and we have 
to create them. It shows how important they are. It also is 
necessary for there to be some waivers because of the red tape 
that is there, that sometimes makes sense and sometimes does 
not. This can in some ways give us a chance to experiment with 
a simplified voucher program, and out of this may come some 
lessons.
    Finally, and this I know is something that we on the 
Democratic side feel very strongly, the vouchers are essential. 
They must be accompanied by funding for additional 
construction. Let me appeal to my conservative friends with 
regard to free market economics. Emergency vouchers, vouchers 
that last for 1 year, will contribute zero to the housing 
supply. No one is going to build housing based on a temporary 
voucher or a 1-year voucher subject to appropriations.
    If we do not want to drive up the price of housing, which 
is already higher than it ought to be in many parts of this 
country from the social standpoint, then we should not be 
adding to the demand for housing without also adding to the 
supply. Vouchers without construction add to demand without 
supply.
    It is morally essential that we help with that demand. We 
do not want to leave people homeless. I am not arguing for not 
going the vouchers. Too many negatives in that sentence. I am 
arguing for the vouchers. What I am saying is that we must have 
along with that new construction funds.
    I was pleased to see the chairman of the committee and the 
gentleman from Louisiana yesterday note that the affordable 
housing fund of the GSE legislation will give us a very quick 
way to get some funding there, but that cannot be the only 
thing. We are all agreed to give total priority there to the 
affected area in the near-term, but there will be people taking 
these vouchers and going elsewhere in the country. There will 
be people going to other cities. They will be going to cities, 
and even though the vouchers are additional, the housing will 
not be. So we need to be putting more money into the 
construction of housing in those areas that will be receiving 
people as well.
    Finally, and this is again something that on our side 
people feel strongly. We have talked to the representatives 
from the affected areas, Mr. Jefferson and others. It is 
something that particularly members of our Congressional Black 
Caucus feel strongly. This is not to be a recipe for the 
depopulation of New Orleans. We do not want there to be a 
policy which makes it easier for people to move away. The 
chairman, based on his own experience, was talking about this. 
One of our goals is to make it possible for people who have 
lived in this city and constituted a community in that city to 
reconstitute that community. It is a very high priority.
    I am glad to see that we have given the lead in this, and I 
appreciate the extra time, because the very fact that in our 
affordable housing fund amendments that will be on the floor 
next week that I believe are bipartisanly unanimous, almost 
unanimously supported, we are giving priority in the 
construction of new affordable housing for low and very low 
income people with the affordable housing fund to the affected 
region.
    That is a commitment that we are here to rebuild New 
Orleans and rebuild the Gulf Coast and make sure that this does 
not become a new form of gentrification, urban renewal in which 
the poor people are dispersed and other people come back.
    So all of this is to us a package. I am very pleased that 
this committee and this subcommittee in particular seem pretty 
united on this.
    Chairman Ney. Thank you.
    The gentleman from New Mexico, Mr. Pearce?
    Mr. Pearce. Thank you, Mr. Chairman. I appreciate the 
hearing.
    I just have a couple of remarks just addressing the 
overwhelming outpouring of generosity from America as a whole. 
I think our response is to look at the needs and act with 
dispatch and discernment. We need to be concerned about 
returning families to stability and normalcy. We need to also 
simultaneously be concerned about the strength of our economy 
and the soundness of our job market.
    So thank you, Mr. Chairman, for easing us along that path.
    Chairman Ney. The gentlelady from California, Ms. Lee?
    Ms. Lee. Thank you, Mr. Chairman.
    I, too, want to thank you and Congresswoman Waters, our 
ranking member, for really putting into perspective the 
framework with which we need to develop our overall housing 
strategy.
    I also agree that our goal should be providing safe and 
decent housing close to home for those who have been displaced, 
not substandard housing, and also making sure that they are 
afforded the opportunity to get home as quickly and as safely 
as possible. So I think looking at this based on our short-term 
goals and our long-term goals is very important.
    In addition to that, unfortunately there have been some 
waivers and suspensions of very important protections, such as 
affirmative action, Davis-Bacon, and what have you, as we 
rushed to find an appropriate response to this tragedy.
    So I would hope that with the housing piece that we ensure 
that all of our fair housing laws are complied with, our equal 
opportunity laws, as well as making sure that individuals 
receive the type of counseling because, of course, the people 
are traumatized as a result of this disaster. So they need to 
receive the type of job training, health care and social 
services, counseling, as well as the help in making the 
transition in to the temporary housing until they can go home.
    So I just want to thank you again.
    I want to especially thank Congresswoman Waters for really 
being on the ground immediately and bringing back the 
information so that we know exactly what we are doing on this 
committee so we get it right this time.
    I yield the balance of my time.
    Chairman Ney. I thank the gentlelady.
    The gentleman from Texas?
    Mr. Gonzalez. Thank you very much, Mr. Chairman and Ranking 
Member Waters, for allowing me to make an introduction of one 
of the witnesses here today, a constituent newly arrived to San 
Antonio. That is Henry Alvarez, the president and CEO of the 
San Antonio Housing Authority, who is here representing the 
National Association of Housing and Redevelopment Officials.
    Henry came to San Antonio Housing Authority in 2004, and I 
must say that he inherited the housing authority in a crisis 
state and has done a fabulous job. He came, of course, from 
Washington County, where he was the assistant director for 
housing and tenant services there in the Oregon Department of 
Housing.
    I also wish to stress, and I think maybe Henry will cover 
this in his remarks, he is native-born and raised in New 
Orleans, so there is something very personal to what is going 
on today and the efforts in assisting everyone in our 
neighboring State of Louisiana.
    The citizens of San Antonio are fortunate that someone with 
the energy and talent of Henry assumed management of the San 
Antonio Housing Authority at a very critical point in history. 
I told you it was a crisis status, and it is, and it has not 
remained so.
    In a time of decreasing appropriations for public housing, 
his work and that of the board of the San Antonio Housing 
Authority has ensured that this vital agency continues to 
effectively serve the needs of the people of San Antonio. In 
essence, he is doing more with less.
    I also want to say something briefly about the efforts of 
local officials in San Antonio to accommodate the almost 13,000 
evacuees we have received as a result of the Katrina 
catastrophe. Mayor Hardberger, County Judge Wolf, and numerous 
local officials such as Henry, public servants and volunteers, 
have done a tremendous job in helping out our fellow citizens 
find housing and necessary services in a very desperate time. 
With not much more than 24 hours' notice, the citizens of San 
Antonio and Bell County, as well as the citizens of Texas as a 
whole, have stepped up and done their duty to help our 
neighbors in Louisiana and Mississippi.
    I do wish to emphasize again the tremendous role that the 
San Antonio Housing Authority under the leadership of Henry 
Alvarez has been able to coordinate the housing needs of many 
of these evacuees.
    Again, thank you very much, Mr. Chairman and Ranking Member 
Waters. I yield back.
    Chairman Ney. The gentleman, Mr. Scott?
    Mr. Scott. Thank you, Mr. Chairman and Ranking Member 
Waters, for holding this hearing and for other efforts to bring 
important stakeholders in housing together to discuss 
rebuilding the lives that were decimated by Hurricane Katrina.
    I have seen many efforts developed to provide transitional 
housing for displaced residents, and I remain concerned that 
the Government should not simply create unsafe temporary 
ghettoes or displace residents in substantial housing in other 
cities. I also believe that we should begin a discussion about 
providing Government housing for displaced residents.
    While the planning and design to rebuild New Orleans and 
other communities will be determined in large measure by local 
officials, Congress should have a say in how Federal dollars 
are spent. I believe that we have an opportunity to rebuild 
these communities in a way that can open up the doors to the 
middle class for many impoverished families. After all, race 
and poverty and class most certainly did play a role in this 
disaster, and it is important for us to understand that as we 
move forward.
    Now, how can we accomplish these goals?
    First, rather than rebuild pockets of poverty, we should 
encourage mixed income development. The success of HOPE VI in 
Atlanta can serve as a model on how to leverage private dollars 
to rebuild neighborhoods.
    Second, we should encourage builders to hire and train 
local residents in order to provide jobs and skills.
    Third, the families who help rebuild their neighborhoods 
should be given opportunities to become first-time homeowners. 
This could be based on the Habitat for Humanity program.
    Finally, we must ask, what will become of the families who 
cannot or choose not to return to the Gulf region? We must find 
ways to give them new opportunities. I do not want to see them 
just steered into substandard housing and left to join a 
forgotten class in their next city.
    The aftermath of Katrina gives us focus on the class issues 
that divide America. Congress should take this as an 
opportunity to encourage building affordable housing 
nationwide.
    Thank you, Mr. Chairman.
    Chairman Ney. I thank the members.
    We will move on to the panel.
    Congressman Gonzalez, of course, has introduced Mr. Henry 
Alvarez.
    Next is Sharon Daly, senior adviser for public policy with 
Catholic Charities of the United States of America, one of the 
Nation's largest social service networks, providing networking 
opportunities, national advocacy and media efforts, training, 
technical assistance, and financial support.
    J.K. Huey is senior vice president of IndyMac Bank, located 
in Pasadena, California. She is testifying today on behalf of 
the Mortgage Bankers Association, an association whose members 
comprise more than 70 percent of the single-family mortgage 
market.
    Kay Miller is president and owner of T.A. Miller, 
Incorporated, and Tra-Dor, Incorporated, Management, located in 
Shreveport, Louisiana. She is testifying on behalf of the 
Council for Affordable and Rural Housing, a nonprofit trade 
organization that promotes the financing, development, and 
management of affordable rural housing.
    Congressman Aderholt was supposed to be here and could not 
make it at this moment to introduce you, so I will do it.
    David Roberson is the president and CEO of Cavalier Homes, 
Incorporated, of Addison, Alabama. He is testifying today on 
behalf of the Manufactured Housing Institute and the 
Manufactured Housing Association for Regulatory Reform.
    Nan Roman is president of the National Alliance to End 
Homelessness, whose mission is to mobilize the nonprofit public 
and private sectors in a united effort to address the root 
causes of homelessness.
    Barbara Thompson is the executive director of the National 
Council of State Housing Agencies, a nonprofit organization 
committed to advancing the interests of lower income and 
underserved people through financing, development and 
preservation of affordable housing.
    Dave Wilson is a homebuilder from Ketchum, Idaho. He is 
currently serving as president of the National Association of 
Home Builders, whose 220,000 members seek to promote policies 
to make housing a national priority and provide safe, decent, 
and affordable housing for all consumers.
    I would note, without objection, your written statements 
will be made part of the record. You will be each recognized 
for 5 minutes. The yellow light comes on, which is a warning 
period that you have 1 minute left. Anything you would like to 
add after that for the record will be accepted, without 
objection.
    We will begin with Mr. Alvarez.
    I thank all the witnesses today for being here.

 STATEMENT OF MR. HENRY A. ALVAREZ III, PRESIDENT AND CEO, SAN 
 ANTONIO HOUSING AUTHORITY, SAN ANTONIO, TEXAS, TESTIFYING ON 
  BEHALF OF NATIONAL ASSOCIATION OF HOUSING AND REDEVELOPMENT 
                           OFFICIALS

    Mr. Alvarez. Good morning, Mr. Chairman, Ranking Member 
Waters, Representative Gonzalez.
    And to the congressman, let me say, without question, thank 
you very much. I stand just simply to say thank you for your 
generosity and your graciousness for having me here.
    My name is Henry Alvarez, and I am the president and CEO, 
basically the chief knucklehead, over at the San Antonio 
Housing Authority, called SAHA. I am also a native of New 
Orleans, Louisiana, born in Charity Hospital and a product of 
its public housing, both Lafitte and Magnolia.
    It is my honor and a privilege to appear before you today 
on behalf of the National Association of Housing and 
Redevelopment Officials.
    Our membership includes 18,000 housing and community 
development professionals and nearly 3,380 agency members, 
comprising housing authorities, community development 
departments and redevelopment agencies.
    I want to be brief today and I want to say thank you from 
the bottom of my heart. We have basically called my friends and 
family and members of New Orleans and other members of the Gulf 
Coast region many different names and monikers, but they are my 
neighbors; they are my friends, and this is a personal event 
for me because, in some instances, they are actually my family.
    Given that, here in San Antonio much of what we have done, 
we have seen about 13,000 of these families that have been 
displaced by the hurricane. Four thousand of them remain in the 
shelters today.
    We have taken every conceivable action and appreciate all 
that you have done to relax the barriers to assist these 
families, and for the great State of Texas, we have had our 
arms open very wide for these friends and neighbors of mine to 
come into our environment and to try to help them as best we 
can.
    Let me share with you now, Mr. Chairman, some of the 
concerns and recommendations and thoughts of NAHRO.
    First, we agree with you. We continue to strongly recommend 
that Congress authorize and immediately make resources 
available to fund a minimum of 50,000 emergency tenant 
assistance vouchers to assist the displaced families of 
Hurricane Katrina.
    These vouchers, however, should be in addition to our 
existing vouchers products, notwithstanding, as in the city of 
San Antonio and much of the housing authorities in the country, 
we have 23,000 families waiting.
    As such, I agree that we should not displace those families 
in addition to having them compete with families displaced by 
Katrina. We ask that this allocation come as quickly and 
efficiently as possible. We will add into the record a model 
for which we believe can assist in doing that.
    Notwithstanding, our HUD secretary has relaxed many of the 
regulatory requirements, but there are some others that we 
would like to talk about very briefly. We hope that they would 
relax the 20 percent limitation on project-based vouchers, that 
we would be allowed to increase the number of residents that we 
can put in project-based families.
    The other issue is that we find some funding to provide 
security deposits and transportation activities. One of the 
things that, as we walk through the shelters, folks are 
concerned about is how do we get from here to there; how do we 
reunite ourselves with our families; how do you get me off the 
bus and to where I need to be so that I can see the kids that 
have been sent someplace else other than San Antonio.
    We continue to have one of the greatest humanitarian 
efforts in the city of San Antonio that I have ever seen. We 
have seen agencies that for years have never spoken to each 
other, never as much as said good morning, but they have all 
come together to help these families of Katrina.
    We ask also that in the community development block grant 
program that you take a look and relax some of the flexibility 
in that program, particularly as in New Orleans that will be a 
need for tremendous infrastructure to rejuvenate our local 
economies and to help create jobs and to provide Section 203 
processes for those families that will need to help and assist 
in rebuilding the great city of New Orleans.
    I hope that these things can be done very quickly. There 
are a lot of us here to talk today, and I do not want to 
belabor the point, but I want to share with you from the bottom 
of my heart, we are not talking about just folks. These folks, 
my family home is in Gentilly, right behind Dillard University, 
and it is under water. We are talking about folks who are our 
friends, our neighbors, our family members. I hope that you 
will move quickly to do whatever is essentially necessary to 
help these families.
    Also, before I conclude my remarks, I would like to say 
thank you to Congressman Frank for his continuing support for 
House Resolution 1461, the Federal Housing Finance Reform Act 
of 2005.
    With that, Mr. Chairman, again my heartfelt thanks, and it 
is a sincere thank you for having me here today. That concludes 
my statement, and the remaining portions of my remarks will be 
added to the record, if you have no objection.
    [The prepared statement of Henry A. Alvarez III can be 
found on page 63 in the appendix.]
    Chairman Ney. Thank you. No objection, and we appreciate 
your testimony.
    Mrs. Daly?

  STATEMENT OF MS. SHARON M. DALY, SENIOR ADVISOR FOR PUBLIC 
                 POLICY, CATHOLIC CHARITIES USA

    Ms. Daly. Thank you, Mr. Chairman and Ms. Waters, for 
convening this hearing. My name is Sharon Daly, and I want to 
thank you.
    I am here to represent Catholic Charities USA and its 
member agencies which in a typical year serve well over seven 
million poor and vulnerable Americans. Catholic Charities USA 
is providing critical support wherever it is needed.
    You asked us to report on our efforts and its response to 
the disaster, but I will do so very briefly.
    We have already forwarded over $1 million in donor 
contributions to Catholic Charities agencies in the States 
hardest hit: Mississippi, Louisiana, Texas, and Alabama. Our 
disaster funds operate out of a special account and we direct 
donations to the most affected States as well as to the 
agencies aiding evacuees across the country. These donations 
are for temporary food, housing, clothing, and other basic 
necessities for crisis and grief counseling and financial 
assistance. Additional funds will be forwarded as they arrive.
    We appreciate the generosity of our donors and are 
respectful of their wishes to provide direct aid to the 
victims. None of the money donated for Katrina relief will be 
used for the regular expenses of Catholic Charities, and 96 
percent of the donations will go directly for victims.
    Following most previous disasters, Catholic Charities 
agencies serve their communities through long-term assistance. 
But this time, the lack of emergency aid in many areas has 
required our agencies to take on new roles to keep people alive 
until FEMA and the Red Cross and others arrived.
    Last weekend, Catholic Charities was the only agency 
helping people in many communities in Mississippi. Our dioceses 
in Biloxi and Jackson have already provided food and emergency 
shelter for several thousand displaced families. Staff and 
volunteers from our Florida agencies and the Florida Catholic 
Conference have been on-site in Mississippi since September 5.
    In Biloxi, as Charities teams go door to door in the most 
ravaged areas distributing food and water and other supplies, 
the commodity most in demand is bleach to clean up the filth in 
people's houses, houses that they cannot leave because there is 
no place to go.
    We have also been there from day one in Louisiana. Catholic 
Charities of New Orleans, which a week ago was under 10 feet of 
water, has been operating out of Baton Rouge and is 
distributing 400,000 pounds of food daily. The agency operates 
a medical and respite care center where police and firefighters 
and other responders working on the ground in New Orleans can 
get crisis and trauma counseling, medical attention, and other 
support before returning to duty.
    Father Larry Snyder, our president, has been in Baton Rouge 
for over a week, and Pope Benedict's envoy, Archbishop Cordes, 
arrived on September 10 in Baton Rouge to provide spiritual and 
material aid.
    Far more is being accomplished than I can report today. Our 
agencies in an additional 22 States are working to help 
evacuees providing shelter and emergency assistance and working 
toward longer-term solutions. My written testimony highlights 
some of what our agencies are doing.
    We have all seen the devastation and the need. Now imagine 
that instead of seeing it on TV you are living it. Imagine that 
you have lost everything and are scrambling for water, food, 
shelter, and basic safety for you and your family. Imagine 
being helpless. Imagine having witnessed the death and rape of 
many while you struggle to survive another day. You do not have 
any safety nets--no car, no house, no credit card, nothing. How 
would you rebuild?
    Our first recommendation is that getting evacuees out of 
the sports arenas and mass shelters is critical. In communities 
where the housing stock has been destroyed or is uninhabitable, 
trailers and manufactured housing are needed immediately. 
According to FEMA, hundreds of thousands of trailers have been 
purchased or will be soon, but in many of the hardest-hit 
areas, there is no emergency housing of any kind.
    While trailers are preferable to shelters and sports 
arenas, they are no substitute for rapid reconstruction of the 
communities that have been physically, but not spiritually, 
destroyed.
    The kindness and generosity of Americans who have accepted 
evacuated family, friends, and strangers into their homes must 
not be abused by the Federal Government. The burden must be 
shared by all Americans through adequate Government responses, 
not just by the brave and resourceful and generous. Congress 
must ensure that the Federal Government gets appropriate 
housing and services in place before this overwhelming 
hospitality is exhausted.
    We suggest the following.
    For emergency housing, the committee should instruct FEMA 
to reach out to faith-based and community groups, as well as 
other property owners, that have property suitable for the 
installation of small numbers of temporary housing units such 
as trailers.
    There are reports that FEMA plans to install 25,000 
trailers on property near Baton Rouge. High concentrations of 
evacuees who are at least temporarily unemployed and have lost 
everything is a recipe for another disaster.
    Chairman Ney. I want to just note to the gentlelady that 
the time has expired, but if you would like to wrap up and that 
way we can have time for questions.
    Ms. Daly. We also urge, as Mr. Frank and others, Mr. Shays, 
has said, that it is very important that residents, including 
low-income residents in these areas, have a chance to 
participate in the planning for redevelopment.
    We agree that there is a need for an enormous increase in 
emergency Section 8 vouchers in addition to those that are 
already done. And we would support the recommendations already 
mentioned for waivers of some Section 8 requirements so that 
landlords who are volunteering for the first time to house 
Section 8 clients are able to get into the program and people 
get out of those shelters.
    In addition, we think we need money right away to rehab the 
damaged housing in the Gulf area that has been assisted by 
housing the Section 8 and 202 and other programs, that have 
been damaged, but with repair could be habitable fairly soon.
    We also urge the committee to adopt--
    Chairman Ney. I hate to interrupt the gentlelady.
    Ms. Daly. Okay, just 1 more minute, 1 second.
    Please find some way to produce more affordable housing for 
the lowest-income families. There is right now no Federal 
program that does that, and we need to make sure those families 
have housing as soon as possible.
    Thank you, Mr. Chairman.
    [The prepared statement of Sharon M. Daly can be found on 
page 94 in the appendix.]
    Chairman Ney. Thank you. We will have some questions for 
you where you will be coming back in because I think you have 
some very valuable thoughts. Thank you.
    Mrs. Huey?

  STATEMENT OF MS. J.K. HUEY, SENIOR VICE PRESIDENT, INDYMAC 
    BANK, PASADENA, CALIFORNIA, TESTIFYING ON BEHALF OF THE 
                  MORTGAGE BANKERS ASSOCIATION

    Ms. Huey. Thank you for inviting MBA to testify on how the 
mortgage industry is responding to the disaster caused by 
Hurricane Katrina. I am honored to be here.
    I have over 20 years of experience in mortgage servicing 
and have assisted thousands of borrowers affected by other 
disasters, including Hurricane Alicia that hit the Texas Gulf 
Coast in 1983, where I was on-site in Houston helping borrowers 
with their insurance claims checks. So I understand the anxiety 
and level of stress that these victims are going through.
    I welcome any questions on the general practices of the 
mortgage companies put into place to assist customers under 
these circumstances.
    MBA estimates that as many as 360,000 mortgages were 
impacted by Hurricane Katrina. This number includes both loans 
secured by properties directly damaged from nature, as well as 
properties affected by secondary economic impacts such as job 
losses from the hurricane's aftermath.
    Immediately upon learning of the damage caused by Hurricane 
Katrina, mortgage companies began assisting affected borrowers 
by providing extended grace periods for mortgage payments, 
waiving late fees, waiving the reporting of derogatory 
information to credit bureaus, postponing foreclosure actions, 
and placing calls and e-mails to customers to discuss their 
needs.
    Lenders are also able to assist borrowers with long-term 
solutions, including providing second mortgages, renovation 
loans and refinance mortgages, but it is crucial for the 
borrowers to contact their servicers so that all the options 
can be explored. To this end, MBA has undertaken a series of 
public service announcements in key markets.
    MBA has suggestions for how Congress could help meet 
immediate housing needs.
    For instance, Congress could provide a temporary emergency 
waiver of all requirements for certain programs, such as the 
Low-Income Housing Tax Credit and HUD subsidy programs.
    We also strongly urge Congress to provide funding for an 
additional 50,000 emergency Section 8 vouchers to be 
administered by the appropriate local housing authorities, as 
already recommended.
    MBA also supports the waivers granted under the HOME 
program and strongly supports increased emergency HOME funding. 
Waivers should remain in place for at least 1 year, and further 
waivers of matching requirements, income eligibility 
requirements, and maximum unit subsidies should be included in 
any relief package for disaster victims in those communities 
accepting evacuees.
    In addition to addressing short-term housing needs, 
Congress should address how we renovate damaged homes and build 
new housing in the hurricane-affected areas. We believe FEMA, 
FHA, and other Government programs can be catalysts for 
rebuilding the neighborhoods, but current program requirements 
will be difficult to overcome. For example, attaining an 
appraisal will be difficult if not impossible in many of these 
areas because there will be few, if any, comparable sales. In 
addition, loan limits may need to be waived in order for the 
Federal Government to insure a wider variety of properties.
    MBA also supports lifting the cap for FEMA assistance on 
repairs and replacement housing, reenacting temporary mortgage 
and rental assistance programs, increasing the amount of low-
income housing stock, applying the Section 223 FHA program to 
hurricane-affected areas, and relaxing the service area 
population limits, and income limits under the RHS programs.
    The most immediate need of mortgage companies is liquidity. 
As indicated earlier, mortgage companies are offering short-and 
long-term forbearance to borrowers. However, mortgage servicers 
are required to advance principal and interest to investors. 
MBA urges Congress to grant Ginnie Mae authority to absorb the 
cost of advancing principal and interest during these 
forbearance periods.
    Finally, in our written testimony we address other 
important issues outside of the jurisdiction of this 
subcommittee: brownfields cleanup, tax relief for commercial 
real estate mortgage investment conduits, and suggestions for 
relief from no-bids on loans guaranteed by the Department of 
Veterans Affairs.
    Mr. Chairman, Ranking Member Waters, MBA and the mortgage 
banking industry are committed to helping borrowers who have 
been affected by this great national tragedy. Our goal, 
however, is not only to provide for immediate relief of the 
victims of the hurricane, but to restore the economic health of 
the affected communities as well.
    We appreciate this opportunity to testify, and we look 
forward to working with you and everyone on this panel. Thank 
you.
    [The prepared statement of J.K. Huey can be found on page 
122 in the appendix.]
    Chairman Ney. Thank you.
    Mrs. Miller?

STATEMENT OF MS. KAY MILLER, PRESIDENT, T.A. MILLER, INC., AND 
TRA-DOR, INC., MANAGEMENT, SHREVEPORT, LOUISIANA, TESTIFYING ON 
     BEHALF OF THE COUNCIL FOR AFFORDABLE AND RURAL HOUSING

    Ms. Miller. Good morning. My name is Kay Miller. I am 
representing the Council for Affordable and Rural Housing. I 
have a development, contracting, and management company. My 
company mostly handles properties that are in the State of 
Louisiana.
    Our management company over the last couple of weeks has 
made efforts to help give any assistance that we could to the 
dislocated people of Hurricane Katrina. We have put them in our 
community rooms. We have fed them. We have steered them to 
community efforts that are out there for them and they would 
not have any way of knowing where and how to reach them. We 
have waived security deposits. We have paid their first month 
rent. We have even had utility companies that would not waive 
their deposits for electricity and for water. We paid those 
fees for those tenants.
    In addition to that, we have gone out in our personal 
vehicles and trucks and gathered furniture, taken it to these 
victims, given them a place to live, and given them beds to 
sleep in.
    I appreciate the opportunity to come here and speak on 
behalf of the citizens of Louisiana, Mississippi, and Alabama. 
Our hearts go out to them. Their homes were destroyed, but not 
only that, their communities, their families, their jobs, and 
the workforce that is going to be necessary to rebuild this 
part of the Nation.
    As said earlier so eloquently, what we need is immediate 
additional Section 8 vouchers. We need allotment of rural 
housing vouchers to reach those that are not in the cities, but 
are in the smaller communities, but nonetheless are impacted by 
the hurricane. The USDA has been working over the last week or 
so with emergency rental assistance. I pray that continues, 
that that is not just a short, 6-month problem-solver, but yet 
something for the long term.
    Of course, the immediate needs are for manufactured housing 
to be brought in to move people from shelters into a more 
permanent housing situation so that they can try and mend their 
lives back together. As stated earlier, the emotional affect of 
these people that have been affected by Hurricane Katrina is 
unbelievable. They are walking around in shock. Their emotions 
run the full gamut. They do not know whether to cry, to laugh, 
to beg, to plead, to lay down. They really truly are 
tremendously emotionally scarred by what has happened to them.
    Of course, in the long term what we do need is additional 
affordable housing. Our State in Louisiana especially has been 
affected. Our occupancy rates were already at an all-time high 
anywhere from 94 to 95 percent. In my particular management 
company, we are 100 percent with people on waiting lists and 
begging for housing.
    Our local shelter has been able to place some people, but 
there is no way of actually knowing the magnitude of the people 
that are out there wandering, that are looking for somebody to 
give them some direction about what it is they need to do and 
how it is they need to get there.
    We are going to need additional hiring of probably HUD and 
USDA staffs to focus their concentration back on housing. 
Housing has taken a backseat for the last several years because 
there were bigger fish to fry, as we say in the State of 
Louisiana. Housing needs to get back into the limelight. 
Housing has to be a priority, no matter what the cost.
    We are going to have to also consider that we are going to 
have to work with our local housing finance agencies that are 
in the three States that are affected. They are going to need 
additional personnel. Low-income housing tax credits have 
always been issued on a per capita basis. Those things may have 
to be looked at. We may need to get additional credits in these 
states.
    The south is very unique in that people that are from the 
south want to return to the south. They want to live where 
their families are, their communities are, their friends are. 
They do not want to completely be displaced forever. Please 
allow us the opportunity to bring them home.
    Thank you very much.
    [The prepared statement of Kay Miller can be found on page 
149 in the appendix.]
    Chairman Ney. Thank you.
    Mr. Roberson?

STATEMENT OF MR. DAVID A. ROBERSON, PRESIDENT AND CEO, CAVALIER 
    HOMES, INC., ADDISON, ALABAMA, TESTIFYING ON BEHALF OF 
  MANUFACTURED HOUSING INSTITUTE AND THE MANUFACTURED HOUSING 
               ASSOCIATION FOR REGULATORY REFORM

    Mr. Roberson. Thank you, Chairman Ney and all of the 
members of this subcommittee. On behalf of Manufactured 
Housing, I am proud to be here today to tell you the efforts 
for our industry and some opportunities for improvement in the 
relief effort.
    Immediately after Hurricane Katrina hit, our industry 
started working with FEMA to bring a coordination of efforts on 
resources, available inventory, other capacity and constraint 
issues so that FEMA could understand how we could interface 
with them in the relief effort.
    Over the years, Manufactured Housing has played a vital 
role in providing emergency housing. Last year, our company did 
provide homes in the relief effort for Hurricane Charlie.
    Currently, through working with FEMA, as a result of that, 
there have been about 2,000 homes that have currently been 
purchased that came from existing inventories. There has been 
one bid let by FEMA for the production of 8,000 homes that will 
very shortly begin production from the industry. There has been 
a request for proposal from FEMA of 15,000 to 18,000 homes that 
is still pending and has been pending for over a week.
    We believe the industry today has approximately now, after 
the purchase of these 2,000 homes, 7,000 or 8,000 homes that 
could be purchased from existing inventories, whether it be new 
or used. We believe the industry has the capacity to build 
15,000 to 20,000 homes by the end of the year, depending on 
specifications and order times and other variables.
    We believe in the first quarter of next year, the industry 
could build another 10,000 to 15,000 homes, which gives the 
total amount of homes available over a 6-month period for the 
relief effort of 35,000 to 40,000 homes. Although there have 
been many reports in the media of much higher numbers, we 
believe that is more in line with the real capacity.
    Moving forward to see what could happen for immediate 
improvement of relief efforts, we would encourage Congress to 
take some specific actions.
    The first thing is we need you to help HUD and FEMA and 
other agencies come together so that certain exemptions or 
requirements of the various laws and the oversight that they 
have can be coordinated. For instance, houses purchased from 
existing inventory may not meet wind-zone requirements for 
areas where they may be located. We need you to step in and 
help those issues be resolved between the various agencies. We 
need you to help in transportation and other issues.
    Secondly, we would ask you to look hard to change 
longstanding guidelines at FEMA surrounding their bid process 
and the way they interface with manufactured housing, to reduce 
the paperwork and some of the onerous provisions that are 
there, to encourage bidding from manufacturers to build relief-
effort homes. In our efforts for Hurricane Charlie, we had 
payments made to us that extended over 166 days. Small 
businesses cannot afford that kind of cash-flow problem.
    There can be unreasonable delivery schedules. There are no 
force majeure provisions that provide for relief for 
manufacturers in the event that materials are unavailable. 
There has been testimony here today surrounding the problems 
with materials and the design longstanding in FEMA prevents 
manufacturers from proactively bidding to build product.
    In addition to that, we would ask that you would look at 
those provisions also to ask FEMA to extend contract delivery 
periods. Houses need to be delivered where they are coordinated 
with infrastructure. You do not build houses and set them on 
staging areas and let them sit there for months before 
utilities are there. There is no reason to speed the process or 
interrupt business for manufacturers. We can work together to 
coordinate those efforts.
    In addition to that, we think that the Federal Government 
should extend help for financing of new homes to victims, 
whether it be through loan guarantees, whether it be through 
low rates, whether it be through preferential treatment of all 
types of affordable housing, including manufactured housing, 
and that all these efforts would have an immediate impact on 
the relief efforts.
    Over the long course, we also see some opportunities. The 
fact is that we believe that FEMA needs to cooperate in a long-
term partnership plan with manufactured housing where we can 
change the bidding process. We can change the specifications 
for the houses where we can have industry input to help FEMA 
save money, speed up response, these types of things. We 
believe there could be a comprehensive plan for staging areas 
and otherwise and that there could be some ongoing production 
that could speed up the process in the future.
    Lastly, I would like to speak just a little bit about the 
long-term housing solution. Manufactured housing and modular 
housing has come a long way. We do not have the same old image 
of the house trailer that a lot of you think we do. We can 
provide all classes of product today and manufactured housing 
needs to play a vital role in the recovery for New Orleans and 
the rest of Louisiana and the Gulf Coast.
    We would ask Congress to update and modernize and give 
preference to financing for manufactured housing and modular 
through the financing through the GSEs and FHAs. There have 
been numerous changes for unreasonable underwriting and 
appraisal guidelines. We need to see things happen to adjust 
advanced structures and other regulations and encourage new 
lending.
    We also think that it would be proper and important for 
Congress to work with State and local governments to work on 
zoning restrictions and other areas. We also think that it is 
most important that Congress move to execute the Manufactured 
Housing Improvement Act that started 5 years ago.
    Chairman Ney. I do want to caution you that the time is 
over.
    Mr. Roberson. I appreciate that, and I thank you today.
    [The prepared statement of David A. Roberson can be found 
on page 164 in the appendix.]
    Chairman Ney. We still will take the rest for the record. I 
am sure there will be questions that will allow you to come 
back into the conversation.
    Mr. Roberson. Thank you very much.
    Chairman Ney. Thank you.
    Ms. Roman?

STATEMENT OF MS. NAN P. ROMAN, PRESIDENT, NATIONAL ALLIANCE TO 
                        END HOMELESSNESS

    Ms. Roman. Thank you so much for inviting me to testify 
today on behalf of the National Alliance to End Homelessness.
    The Katrina disaster has created hundreds of thousands of 
homeless people. Many of these new homeless people will look a 
great deal like the 750,000 people who were homeless across 
America the night before the hurricane hit: desperately poor, 
disproportionately minority, and often disabled.
    Hurricane Katrina was a crisis of massive proportion, but 
those most affected are the same Americans whom any disaster, 
personal or natural, can send spiraling into homelessness. The 
past two decades of work with homeless people and programs have 
taught us many lessons, and I wanted to share some of those 
today with respect to Katrina, focusing on the short term.
    First, I concur with many other comments here today, that a 
first goal must be to get people out of the shelter system 
quickly. Shelter is bad for people. It has all kinds of 
negative consequences for individuals and families. Those 
consequences also are very costly to public systems of care.
    The question, of course, is not whether to get people out 
of shelter, but how we do it. Here are a few things that we 
have learned over the years, starting with people who need 
relatively little assistance and moving on from there.
    Rent subsidy, if provided quickly, could result in housing 
stability for as many as 75 percent of households affected, 
assuming housing is available. We support the use of vouchers. 
FEMA also, of course, has the authority to provide up to 18 
months of rent subsidy at fair market rent, and we strongly 
recommend that they do so quickly.
    Since FEMA does not seem to be doing a good job of dealing 
with housing or distributing money, it might make more sense to 
try to get the FEMA resources turned over to the Housing 
Finance Agencies, the public housing agencies, or somebody who 
knows more about how to deal with housing.
    At least 250,000 of the evacuees were very poor and are 
going to require more than a short-term rent subsidy. They are 
going to need longer-term rent subsidy and help negotiating 
housing placement and services. To link people with housing and 
services rapidly, grants could be given to local nonprofits or 
city agencies to provide care management assistance.
    Of those 250,000 evacuees who are likely to be extremely 
poor, about 10 to 20 percent, say 25,000 to 50,000, are likely 
to be disabled and to need an even more sophisticated 
combination of services and housing.
    We are already hearing anecdotally from Katrina shelters, 
both in the affected area and across the Nation that those 
people with more resources are rapidly leaving the shelters, 
while those people with mental illness, serious stress 
disorders, untreated substance abuse disorders, physical 
disabilities, and the elderly are remaining in the shelter 
system.
    To identify and refer this group of people to proper 
housing, we need to quickly get funding for case management or 
specialized staff into the shelters. Supportive housing, 
housing with services, would work well for this population.
    I think we made a mistake in the homelessness system by 
leaving this most vulnerable disabled population to languish 
for years in shelters, and I hope that with some special 
attention and resources, we can avoid making that mistake again 
in the aftermath of Katrina.
    In addition to rent subsidies, temporary housing, as 
everyone has commented, will be needed. Reports are that all 
available housing in the affected area has been rented or 
purchased, yet there are 50,000 people remaining in Katrina 
shelters there, so permanent housing will have to be quickly 
created for these individuals and families in whatever way 
possible, as has been discussed.
    A few more general thoughts.
    An administrative data system that can continually keep up 
to date on people's location, needs and plans is essential, 
both to meet immediate housing and service needs and to plan 
for the future. How can we know the number of temporary or 
permanent housing units that are needed, that we need to plan 
for, in the total absence of any reliable information about 
what people's needs or intentions are?
    The Federal Government has already fully tested a homeless 
management information system that could do the job. The State 
of Louisiana, tired of waiting for an okay from FEMA, went 
ahead and implemented it throughout the State of Louisiana. It 
should be extended nationwide immediately.
    Also, as others have said, new resources are needed. We 
cannot help the newly homeless people on the backs of those who 
are already homeless or who are at risk of homelessness. We 
urge support of the voucher program as well.
    And also, I think someone needs to be put in charge of the 
housing function around Katrina. It is completely 
uncoordinated. There are tremendous amounts of resources that 
are going to be spent with no information and no coordination. 
So I think that an important step, really, is to get someone 
who knows about housing in charge of this critical activity.
    At a minimum, Hurricane Katrina must not be allowed to 
increase the number of poor and homeless people in our Nation. 
I think we can aspire to a much higher goal than that, though.
    I thank the committee for its commitment, for its interest, 
and for its bipartisan efforts to do something to help the 
victims of this terrible disaster.
    [The prepared statement of Nan P. Roman can be found on 
page 170 in the appendix.]
    Chairman Ney. I want to thank you.
    Ms. Thompson?

STATEMENT OF MS. BARBARA THOMPSON, EXECUTIVE DIRECTOR, NATIONAL 
               COUNCIL OF STATE HOUSING AGENCIES

    Ms. Thompson. Thank you for this opportunity to testify 
today on behalf of the National Council of State Housing 
Agencies. NCSHA represents the housing finance agencies of the 
50 States, the District of Columbia, Puerto Rico, and the U.S. 
Virgin Islands.
    State HFAs allocate the Low-Income Housing Tax Credit, 
issue housing bonds, and administer HOME and other HUD 
assistance all across the country.
    State HFAs have responded to Katrina with an outpouring of 
support and concern. State after State, some as far away as 
Maine and Utah, have offered to provide housing to displaced 
families. Collectively, HFAs have registered thousands of 
housing units with FEMA. Many are already housing families.
    HFA efforts have not stopped there. Many have contributed 
staff, technical assistance and other resources to the affected 
HFAs. Some have even offered to give up some of their own 
desperately needed Federal housing resources to help meet the 
dire housing needs in Katrina-afflicted States.
    We at NCSHA have tried to do our part. We have focused 
first on regulatory barriers preventing the immediate housing 
of families in available housing credit, HOME, and other 
federally assisted housing. We have asked the IRS and HUD for 
immediate relief from income qualification and other occupancy 
rules.
    The IRS has responded, providing on September 9 official 
guidance allowing housing credit property owners all across the 
country to house families displaced by Katrina regardless of 
their income. With NCSHA's encouragement, the IRS is now 
preparing additional relief to facilitate the development of 
new housing credit apartments that will be needed in the 
afflicted States. HUD, too, has taken steps to get displaced 
families into available housing.
    I want to focus the remainder of my time this morning of 
what still needs to be done.
    Congress needs to provide immediate program relief that 
Federal agencies lack the authority to provide. We have asked 
this subcommittee, for example, to waive voucher and HOME 
rules. We have provided staff our detailed proposals.
    Tearing down barriers to the use of existing housing 
resources, however, will not be enough. Resources are woefully 
insufficient to meet the Nation's housing needs. They were 
before Katrina and now after Katrina they will be taxed to the 
breaking point.
    States are not turning over housing to Katrina-displaced 
families because they have no need for it. They are doing it 
because the needs of families left with nothing are more urgent 
than the urgent housing needs of other families still waiting. 
This is a choice States should not have to make.
    We urge Congress to provide more housing resources 
immediately, not only to the afflicted States that need it 
most, but also to those who have sacrificed their own resources 
to help those States. We ask you to work with appropriators to 
provide immediate emergency additional voucher and HOME 
funding.
    In addition, we ask you to re-examine with the 
appropriators your fiscal year 2006 HUD funding bill to take 
account of the long-term pressure the Katrina rebuilding effort 
will place on so many States.
    This is also the time to expedite enactment of pending 
legislation that would make new housing resources available. We 
especially urge you to enact the GSE bill and the affordable 
housing grant fund it contains. NCSHA also asks this 
subcommittee to work with your tax committee colleagues to get 
additional housing bond and credit resources. Unfortunately, so 
many of those who lost their homes are the very poor who we 
cannot reach with many of the housing resources available to 
us.
    It is critical, therefore, that we have as many flexible 
tools at our disposal as possible because it is only through 
combining tools like housing credits, HOME grants, and vouchers 
that we can reach these families.
    Finally, though we hope never to face a natural disaster of 
the magnitude of Katrina again; we know future natural 
disasters are inevitable. We need to prepare for them now with 
new housing production and my getting permanent disaster 
regulatory and statutory relief on the books.
    Thank you for this opportunity to testify today.
    [The prepared statement of Barbara Thompson can be found on 
page 175 in the appendix.]
    Chairman Ney. Thank you.
    Mr. Wilson?

STATEMENT OF MR. DAVID F. WILSON, HOMEBUILDER, KETCHUM, IDAHO, 
        PRESIDENT, NATIONAL ASSOCIATION OF HOME BUILDERS

    Mr. Wilson. Thank you, Chairman Ney, members of the 
subcommittee. On behalf of the 220,000 members of the National 
Association of Home Builders, I appreciate the opportunity to 
testify today. I am a builder from Ketchum, Idaho, and the 
current president of the National Association of Home Builders.
    The first point I would like to make this morning is that 
nothing will happen to rebuild the Gulf region until a local 
builder pounds the first nail in the first stud to rebuild his 
own community. That is why one of the first steps that NAHB is 
taking is rebuilding the housing industry in the areas affected 
by Katrina.
    We believe that up to 9,000 NAHB members have been 
displaced, lost their homes or businesses, and have otherwise 
been affected in this tragedy. NAHB and its State and local 
associations are working as quickly as possible to get these 
builders back to work and on their feet so they can begin 
rebuilding their own communities.
    Further, in an effort to reach out to our builders on the 
Gulf Coast, NAHB is placing public service announcements in 
newspapers and on radio and television in the affected States 
and in Texas, asking the builders who have been economically 
disadvantaged or displaced to call a designated number so 
affiliates can provide them with assistance to help them get 
back on their feet in their communities. State and local 
building associations in the region are also helping to 
organize materials donations to be used in the rebuilding.
    Further, our members in Texas have organized a Web site to 
connect available affordable housing units with evacuees in 
Houston. This effort resulted in more than 1,000 individual 
families securing a home in the first 2 weeks of the disaster.
    The task of rebuilding is unprecedented, with more than 1 
million people homeless or displaced. In Louisiana, 
Mississippi, and Alabama, Katrina destroyed 275,000 homes, 
according to the latest estimates by the Red Cross. This is 
nearly 10 times as many as the previous natural disaster. 
Further, countless other homes were severely damaged and 
require immediate extensive repairs.
    It is important to remember that the impact from the 
hurricane is not only being felt in the affected areas, but 
also in those States taking evacuees where housing must also be 
provided. We applaud the steps taken by Congress and the 
Administration to meet the housing needs of those affected by 
Katrina.
    Along these lines, I would respectfully ask Congress to 
make NAHB a partner in the housing area command. NAHB 
understands the immediate need to build temporary housing 
quickly.
    However, we believe it is important that the building 
industry is a long-term partner with the Government on 
rebuilding those communities. Ultimately, it is important that 
competitive quality housing is rebuilt and the community 
character is restored to those affected neighborhoods. Local 
builders have long been part of their local communities, and it 
is essential that they be part of the rebuilding of their own 
communities.
    My written statement contains detailed lists of additional 
recommendations for Congress in addressing both the immediate 
critical housing needs of evacuees and the long-term 
reconstruction of housing infrastructure and supply. Let me 
begin by mentioning a few of our short-term relief 
recommendations.
    First, ensure that the Section 8 housing voucher program 
can be used to address the emergency needs of existing voucher-
holders who were displaced, as well as the newly displaced 
persons.
    Second, ensure the displacement persons can move into units 
financed with low-income housing tax credits and other HUD 
programs and quickly and without negative consequences to the 
owners. This can be accomplished by implementing consistent 
program waivers across all housing programs such as applying 
the waivers for income limits provided recently by the IRS for 
low-income housing tax credit properties to HOME-assisted or 
other HUD-assisted properties as well.
    Next, I want to touch on a few long-term key needs.
    First and foremost, Congress will need to ensure the 
affected communities receive adequate funding for Federal 
housing programs.
    Second, streamlining programs like FHA mortgage insurance, 
HOME, community development block grants, Section 108 loan 
guarantees, and USDA rural housing services will ensure the new 
construction rehabilitation activities can move forward 
quickly.
    Also critical to the massive repair and replacement effort 
is the need for large amounts of building material. By way of 
comparison, the recovery from four major hurricanes that struck 
the Gulf Coast in 2004 is still incomplete, hampered by 
shortages of roofing, concrete, plywood, and other vital 
materials. The cost of construction materials has increased 
more than any time in the past 25 years. Duties imposed by 
Canadian lumber, Mexican cement, as well as other duties on 
Brazilian plywood have increased the cost of housing and 
contributed to the material shortage.
    We believe that the immediate need to build temporary 
housing quickly is very, very important. However, it is 
important that the building industry be a long-term partner 
with governments on rebuilding our communities.
    Ultimately, it is important that competitive, quality 
housing is rebuilt and the community character is restored to 
the affected neighborhoods. Local builders have long been part 
of their communities and it is essential they are part of the 
rebuilding.
    Thank you very much.
    [The prepared statement of David F. Wilson can be found on 
page 179 in the appendix.]
    Chairman Ney. I thank all the witnesses for your testimony.
    I do not know really where to begin, but let me ask just a 
couple of questions and give a couple of observations.
    We have some members that have joined us.
    I want to go to the issue of the manufactured housing. 
There is something floating around Congress this morning that I 
have heard of, and last night, that FEMA--and maybe you can 
answer this or maybe you can't--that FEMA has asked for 300,000 
manufactured homes.
    Do you know anything about that?
    Mr. Roberson. Thank you, Chairman Ney.
    As I testified earlier, the only information that we have 
at the industry so far is currently FEMA has issued contracts 
to buy 2,000 houses that were in existing inventory. Some of 
that is going on to retrofit those to specs that would be 
suitable for them in the field.
    They have issued one contract for the production of 8,000 
homes to be built and delivered to the Gulf Coast region. They 
have also issued what they call an RFP, or request for 
proposal, to the industry for 15,000 to 18,000 more homes.
    As I speak today, there have been no bids awarded or 
accepted for the production of that, but that is all of the 
capacity that we have seen for the industry so far is that 
10,000 houses from existing and those to be built. We also 
believe that the industry has the capability to build 15,000 or 
20,000 houses here in this fourth quarter and then probably 
another 10,000 to 15,000 in the next quarter.
    Chairman Ney. I just wanted to raise this because this was 
floating around last night and I was asked to look at this 
letter. I said no. I am not going to sign that kind of letter. 
I think this is a panic thing that FEMA is buying 300,000 
houses. Maybe they need to buy 300,000, I do not know, but I am 
just saying at this point in time I just wanted to ask you.
    If you are in the industry, has FEMA said, "Hey, we would 
like to buy 300,000"?
    Mr. Roberson. No, they have not. It would be a little bit 
impractical. Last year, the industry built about 130,000 
houses.
    Chairman Ney. Okay.
    Mr. Frank. Would the chairman yield for a second?
    Chairman Ney. Yes.
    Mr. Frank. I appreciate that. That is why I am grateful 
that through the chairman's good auspices we are going to have 
that briefing with FEMA and HUD today.
    I will say some of the information we had is that a large 
number of the temporary units are in fact going to be RVs and 
not fixed units, which frankly I prefer because that means it 
is less likely that we are going to have permanent colonies.
    But that is part of the information, that a large number of 
those 300,000 we have heard from some people will be RVs, 
rather than actually physical homes on-site. That is one of the 
things that we will be get clarified from FEMA today.
    Chairman Ney. I wanted to ask several of the witnesses, Ms. 
Daly and others, there are a lot of emergencies to start with. 
As the city is rebuilt, which it has to be rebuilt, what do you 
do about the levees? I am not going to even get into that 
today. So we have to make a decision. Do we have one that 
sustains a level five, a level four?
    There are a lot of urgent things, and I know that. But to 
me, the shelters, and I have heard this over and over; I have 
heard from our ranking member and others. The shelters, to me, 
are the absolute urgent, got to be dealt with today issue.
    Now a couple of statements I have heard people make in 
conversation on this is, well, we do not want to dislocate 
people; we do not want to relocate people. We also do not want 
what people are calling trailer parks and problems.
    But how do you deal with not relocating, but you have to 
have the temporary housing? Is there any problem you see with 
temporary manufactured housing in locations close to the 
affected areas in Louisiana, Mississippi, and the other Gulf 
States?
    Ms. Daly. Mr. Ney, thank you for that question.
    We think it is very dangerous if we concentrate large 
numbers of trailers or manufactured housing close together. You 
know, all of you know about the problems of densely populated 
high-rise public housing and how we have had HOPE VI to try to 
answer those problems. Let's not, as Mr. Scott mentioned, 
create a lot of new ghettoes.
    We do need to get people out of those shelters. You are 
absolutely right. The elderly are in grave danger in those 
shelters. We have to get them out.
    Chairman Ney. So there is no problem with manufactured 
housing. It is how many you put into a specific contained area.
    Ms. Daly. We are not experts on manufactured housing. We 
just know you have to get those people out of shelters. If you 
concentrate them very closely together, you are going to create 
even more problems and another kind of disaster. There are a 
lot of nonprofit organizations, churches and so forth, in those 
areas where you could put trailers scatter-site, so you do not 
have to concentrate them in one place.
    Chairman Ney. Mr. Alvarez?
    Mr. Alvarez. Congressman, let me suggest just every fabric, 
every probable solution to the problem should be utilized.
    We have one that is extensively working. The voucher 
program, if it is relaxed and increased in funding, allows 
families to locate anywhere they want to in any city in 
America. At the time when it is necessary or available for them 
to return to whatever city or State they have come from, they 
would be able to do so. That mechanism is already in place.
    Chairman Ney. Due to the nature of some time, and people 
will have to leave, I will come back to that because on that 
issue if you only give people the choice to leave the Gulf 
States, that is the only choice, therefore, they have, if you 
give them the choice to leave the Gulf States. If you give them 
a choice to have some manufactured housing in smaller units, 
then they have a choice. But if you just say, here is the 
voucher and you can go anywhere in the country you want, you 
are really not giving them a second choice. You are saying here 
is the voucher and you will go somewhere else. So I think there 
is room for both discussions.
    Right now, I am going to yield to the ranking member.
    Ms. Waters. I am going to yield to Barney Frank.
    Mr. Frank. I thank the gentlewoman because I have another 
meeting to go to.
    Let me say first, and I appreciate this point, we I think 
are unified. There are two reasons not to have semi-permanent 
colonies. One, they are not great in and of themselves. Two, 
they would retard what is the goal for many of us, which is to 
give people the maximum chance to come back and reconstitute 
New Orleans, and particularly lower-income people. We do not 
want to see a situation in which the lower-income people cannot 
come back. That is why we have agreement here about an 
affordable housing fund, giving priority in its first year to 
them, et cetera.
    But also, and my staff has shown me the New York Times that 
said this as well, and apparently we have heard both from the 
Recreational Vehicle Association, as well as the Manufactured 
Housing Institute, that the great majority of units being 
purchased for temporary residents are recreational vehicles, or 
they are called here travel trailers.
    That is a good thing because, first of all, you can do them 
more quickly because you do not have to have the hookups that 
are needed. Secondly, they are less likely to be permanent. The 
numbers, apparently the New York Times said last week, are in 
the ratio of about nine to one, travel trailers to mobile 
homes.
    Many of us here have been strong supporters of manufactured 
housing, in addition to more conventional homebuilding. There 
is room for all of this. We will get more of that from FEMA.
    Let me ask one point that came up, to Mr. Alvarez. A couple 
of the members from New York City raised this with us, and that 
is, the housing authorities are going to be hit with increased 
heating oil costs, particularly those in the Northeast and in 
the Midwest. I do not expect it is a major problem in San 
Antonio, but nobody is exempt totally.
    But this is a concern. We know that the cost of home 
heating oil is going to go up. We also know in the Northeast 
and in much of the Midwest, that is a major factor.
    I do not expect you have anything off the top of your head, 
but if NAHRO could give us some response there, it does seem to 
me that some form of fiscal relief to those housing authorities 
ought to be part of the package because they are going to be 
confronted in a short term maybe with an unexpected increase in 
heating oil bills that they have no other way to pay for.
    I do not know if you have any response on that.
    Mr. Alvarez. We do. We will get some materials for you to 
answer that question. But one of the primary utility functions 
in Texas is, of course, air conditioning.
    Mr. Frank. Air conditioning, yes.
    Mr. Alvarez. And it is becoming more and more expensive.
    In those locations where they are using heating oil, 
heating oil today has almost doubled in cost. So I think it is 
going to be a significant issue to address.
    Mr. Frank. We have had people say in the past, well, air 
conditioning, that is kind of a luxury, but one of the sad 
facts out of New Orleans are the frail people, people in poor 
health, elderly people who died and whose death was, in fact, 
hastened by 100 degree temperatures. So if anybody thought air 
conditioning was purely a luxury, one of the sad lessons of New 
Orleans is that it is not.
    I appreciate the gentlelady from California yielding to me. 
I have to go off actually to a hearing on Iraq, or as I would 
say, a good way to finance all of this, which is by getting out 
of there, but that is another topic.
    Thank you.
    Chairman Ney. The gentlelady?
    Ms. Waters. Thank you very much, Mr. Chairman.
    The roundtable that we had I think was very instructive. I 
think out of that roundtable, we came away with a bit of a 
consensus about some things. We know that we have to get people 
out of these temporary shelters. That is number one.
    Over the CentralPlex in Baton Rouge, there were 5,000 
people. Let's not even talk about what was happening over at 
the Astrodome. So that cannot last for long. We have to do 
that.
    What I refer to as transitional housing or emergency 
housing, certainly the RVs or the manufactured housing must be 
purchased and they must be located in ways that make good 
sense.
    I just heard yesterday that FEMA was talking about locating 
25,000 in one place. That shall not be. I mean, that is 
absolutely unacceptable and I do not think any Member of 
Congress should support that.
    I am not in the business of creating ghettoes. I am in the 
business of alleviating ghettoes and giving people decent 
housing. So we cannot support, and I do not think my chair 
would support, putting 25,000 manufactured housing or RVs and 
throwing people all into one location.
    We talked about ideas such as churches and others being 
able to offer land or space where you could put these units 
down in small number. We are also interested, based on some of 
our conversations about what happened in Florida and how you 
provide some real management and oversight with these, if it is 
a church, nonprofit, et cetera. I think we need to understand 
how we can involve them in helping to manage some of these 
places.
    Now, the other thing that we continue to talk about is 
this. When I was in Louisiana, every hour I was shocked to 
learn about another decision that sent 400 people up to Utah. I 
understand people were sent up to Utah to a barracks that 
basically sits in the middle of no man's land somewhere.
    These people want to come home. We need relocation 
assistance to make sure that people are able to return near 
their city and community, such as some of those that I have 
alluded to in Louisiana and the same thing in Mississippi and 
in Alabama.
    So I think we have to work very closely with FEMA to make 
sure that they are not making these decisions without the 
benefit of the input that we are receiving in these roundtables 
that we are putting together. Permanent housing must be on the 
agenda in every conceivable way. I think we are committed to 
the building of housing for low-and moderate-income people. 
That can get lost in this siting of these units to accommodate 
the people in the shelters.
    So I think basically we are on the right track.
    I think one of the things we have to figure out with 
housing is what to do about people who lost permanent housing, 
that had no flood insurance, housing that had been handed down 
perhaps from the family, paid for, et cetera, and what to do 
about people who lost homes where they had mortgages and no 
flood insurance.
    We have to figure out those two things and expand, don't 
forget about the needs of the communities that we are talking 
about going into. Those homeless problems did not go away 
because we had Katrina. They are still there, and we have to 
take care of those. The housing needs did not evaporate. We 
have to pay attention to both of them.
    This is an opportunity to seize on every conceivable way by 
which to do this. We have to look at CDBG; we have to expand 
CDBG. We have to expand the vouchers. We have to have disaster 
funding that will accommodate these homes that were lost that 
did not have flood insurance.
    So I think we are on the right track. We are just going to 
have to be very tough and very focused about it.
    One of the things I asked Congressman Rangel to do 
yesterday was to look at tax credits for folks who have land 
that they would like to let us use for the siting of some of 
these. When I was in three churches in Los Angeles on Sunday, I 
had people who came up to me and said, "Ms. Waters, I own 10 
acres of land and you can use it." We have to find ways to make 
that work.
    I think we give tax credits for everything else; let's give 
it to some of these landowners in order to use it for some of 
the temporary housing. It may be some land that we could then 
talk about building permanent housing on.
    I am not in support of trying to keep people out of 
Louisiana, Alabama, and Mississippi. I am in support of 
returning them. The culture shock of taking people and throwing 
them up in cold territories, I mean, it is just too much. We 
have comments about that. We have one shelter in Los Angeles 
that people were taken to and the comments that are coming 
because of everything from food and the way things are done. 
People are very unhappy and they want out.
    So I did not want to get into this. We have enough work to 
do, but there is one such shelter that we have to find out, 
okay, what are the rules? We have people in the shelters. They 
want out. Something is going on here that people just cannot 
tolerate, they cannot stand, they not like it. Nobody knows 
what the rules are to get them out.
    I talked to FEMA. That was a mistake. Of course, they did 
not know.
    And so, we are going to have to create some rules about how 
we deal with some of these problems.
    You are looking at me as if you are baffled, Mr. Scott. 
FEMA did not know what to do about people who had been shipped 
to a shelter, not knowing where they were going in the first 
place. They did not know what State they were going to, and 
wanting to get out, and there are no rules for how they get out 
and get back to Louisiana or to a shelter that is closer to 
where they came from.
    So I do not have any real questions except to say I expect 
those of you who are housing advocates to help form this 
consensus with us in these areas, and then we have to put our 
boxing gloves on and fight like hell to get it done.
    Thank you.
    Chairman Ney. Thank you.
    Mr. Pearce?
    Mr. Pearce. Thank you, Mr. Chairman.
    And thank you, everyone, for your testimony.
    I have multiple questions so I am looking for the short 
version of the answer rather than the long version. We only 
have 5 minutes each.
    Ms. Daly, thanks for your work on behalf of Catholic 
Charities.
    How much have you all budgeted for this particular 
situation?
    Ms. Daly. The money that we send out to our Catholic 
Charities agencies that are serving the survivors comes from 
donations. So far we have sent out $1 million. We hope for $10 
million shortly. It all depends on donations. This is money 
contributed by ordinary people.
    Mr. Pearce. Right. Thank you.
    Ms. Huey, you mentioned liquidity. Do you think the 
financial markets will provide adequate liquidity for an area 
that has been devastated like this?
    Ms. Huey. Well, I think that is one of the greatest 
challenges that our businesses are concerned about. For 
example, when I mentioned the opportunity for Ginnie Mae to 
cover some of the advances, that is going to be critical. As we 
are having to make those advances, the borrowers are not making 
payments to us. So it is critical that that is explored.
    Mr. Pearce. Thank you.
    Ms. Miller, thanks for your personal testimony about the 
things that you have seen and done personally in response. You 
are a developer. How much do you estimate that the shortage of 
materials that Mr. Wilson talked about is going to increase the 
cost per foot? What was the cost per foot previously in that 
area, the Louisiana area, and what will the cost per foot of 
building be now?
    Ms. Miller. Good question. I know over the last week, we 
were just beginning to start site utilities and site-work at 
two properties that we had. I immediately got a phone call from 
my company requesting that they come and sit down with me. That 
is never a good sign.
    We are already seeing about a 10 or 15 percent increase in 
the prices of lumber that they are quoting me at this time. 
They are encouraging me to order materials far in advance of 
what I would normally need so that they will have it available. 
My fear is I am not sure if this is panic or if this is going 
to be worse things to come. It is definitely going to be an 
issue for construction costs in the future for all of us.
    Mr. Pearce. Thank you.
    Mr. Wilson, I have been working with small builders in my 
State for the last 6 or 8 months. It looks like the EPA has 
changed some of the regulations and some of the enforcement on 
small builders, very much threatening their survival.
    Has that same push been seen in the affected areas of the 
Gulf Coast prior to the disaster? Do you need relief from that 
regulatory push that really was threatening the number of 
builders who would even be available?
    Mr. Wilson. I think that push still continues. EPA is 
still--we are at odds with them on storm water enforcement, 
obviously.
    Let me mention on materials, I can tell you that OSB and 
plywood went up 55 percent in the last 4 days. Lumber is up 15 
percent, and cement is on an allocation basis. You have to make 
a reservation to get a load of cement now in most communities 
in this country.
    Mr. Pearce. The cement question is a larger question. 
Actually, the builders had requested that we look at the 
dumping from Mexico about a year ago, and in response to that 
then we came in with the tariffs. Then when the supply got 
sucked up by China, now our tariffs have driven the price up by 
60 percent.
    Do you think the association would back the review of the 
initial dumping request on Mexico to get that supply available 
at a cheaper price?
    Mr. Wilson. We have actually asked the Administration to 
look at removing the tariff and are in conversation with 
Mexico. As you note, cement has gone from $50 a yard to $95 a 
yard, so it is driving up the cost of construction.
    Mr. Pearce. Ms. Thompson, you talked about the need for 
$3.5 billion in housing vouchers. At the end of your testimony, 
you said that we need more resources. Is that even above the 
$3.5 billion?
    Ms. Thompson. Yes. I was referring to the voucher funding. 
In addition, we do need for the long-term rebuilding more 
resources like more low-income housing tax credits and bonds.
    On your point, Congressman Waters, yesterday--
    Mr. Pearce. I am sorry. If you could not address that. It 
is my question and my time. Thank you.
    Ms. Thompson. Okay.
    Mr. Pearce. Ms. Roman, you had mentioned that we had 
750,000 homeless prior and this is going to add another 
250,000. Of that 750,000, if we were to look at individuals, is 
that 750,000 a static group of people or is it a rotation of 
people in and out?
    And then of the 250,000, if that 750,000 is stable and not 
decreasing, of the 250,000 can we expect most of those then to 
stay in the homeless category? Would you address that?
    Ms. Roman. The 750,000 is a nightly count, so it is not 
static. Over the course of the year, there are about 2.5 
million to 3.5 million people who become homeless. The 250,000 
is people who are very poor who became homeless. A million 
became homeless, but the 250,000 are the people who were very 
poor.
    If those people get rent subsidy, no, they will not remain 
homeless. None of them should remain in the homeless system. We 
should be able to get all of them out. Rent subsidy should work 
for a lot of them and some services. Some will need a little 
more.
    Mr. Pearce. Thank you, Mr. Chairman. I see my time has 
elapsed.
    Chairman Ney. Thank you.
    Mr. Scott?
    Mr. Scott. Thank you very much, Mr. Chairman.
    Let me start by making sure we have our hands around the 
accuracy of the size and scope of this problem. How many people 
are we talking about that right now we need to get out of the 
shelters into temporary transitional housing? Does anybody know 
the answer to that question?
    Ms. Roman.Number one, I would say there is a big problem 
with data, and I addressed that in my testimony. I do not know 
how you can do your jobs when you cannot assess, even to the 
hundred thousand, how many units of housing are needed and 
where.
    Based on what little we do know, there are 50,000 people, 
as I understand it from reports from the area, in Katrina 
shelters in the affected areas as of 2 days ago. This is not 
all the people in shelters, just those in the affected region.
    In the affected region, there is no housing, as I 
understand it. So people in shelter there could be given rent 
subsidy, but they cannot get into any housing in the area. They 
definitely need temporary housing, as I see it. So that is 
50,000 who need temporary housing.
    Then in the surrounding area, there was a fair amount of 
vacancy before Katrina. We have looked at the number of units, 
without respect to cost, that were vacant before the hurricane 
from Texas to Georgia, without respect to cost. There were a 
lot of vacant units, over 200,000. Now how many there are now, 
I do not know because of course people have spread out to those 
areas.
    I would guess that the farther you get away from the 
affected area, the more there is vacancy and the more 
effectively rent subsidies are going to work. The closer you 
get to the affected areas, the more help people are going to 
need to get into housing as vacancy rates decrease. But until 
you get some data, I do not know how you can adequately plan 
for housing.
    I think there is a way to get the data, which I addressed 
in my testimony. We should implement such a strategy 
immediately so that we can understand the dimensions of the 
problem.
    Mr. Scott. Right.
    Ms. Roman. One thing we do know is that there are 50,000 in 
the affected are, in shelter, who have nowhere to go even if 
they had all the rent subsidy in the world.
    Mr. Scott. Do we have any more people in the Astrodome? 
Does anybody know that? Are there any more people in the 
Astrodome in Houston?
    Ms. Waters. Yes.
    Mr. Scott. How many in the Astrodome?
    Ms. Waters. I do not know, but you still have people in the 
Astrodome.
    Mr. Scott. So we have 10,000 in the Astrodome, is that 
right? I think this is a part of our problem. We do not know 
the size of the problem. We do not know the scope of the 
problem. We are here in the dark without even a flashlight 
feeling our way around. I think the most profound question that 
was asked, that was put forward from you the panel was who is 
in charge. Not only do we not know the scope of this problem or 
the size of the problem, we do not have anybody in charge.
    It is a rather pathetic situation, when we need a 
Department of Housing and Urban Development, we are in the 
process of that department being dismantled, with many of its 
programs going over, proposed to go over to the Commerce 
Department, over to Treasury. And the one model that we do have 
that we ought to be using for this, HOPE VI, is not even going 
to be reauthorized.
    I would say we are in quite a mess. But let me just ask 
this, not knowing the size of the problem, but we do know that 
the first order of business is going to have to be getting 
folks into transitional housing. I raised the point in my 
opening comments because I believe that the most urgent need 
now is two-fold: one, not to put a concentration, and I am 
almost tempted to say concentration camp atmosphere.
    I think that if you thought the Superdome looked pretty bad 
by pushing a whole bunch of people into close quarters, what a 
large mistake it would be to even begin to move the process of 
building these huge trailer camps or transition housing all 
clustered in together. I do not know what is being done to make 
sure that does not happen. There are all kinds of safety and 
health reasons and all of that that we have to look at.
    The other thing I want to talk about is how important it is 
to use this process as a way to provide job opportunities, 
training, or efforts for the people who were directly affected. 
I mentioned before, everybody wants to push this under the rug: 
race, poverty, and class. That is the reason why the folks were 
in the position in the first place. It is obvious that we 
cannot dismiss that.
    The American people, to our good fortune, for every survey 
that has been mentioned, ABC-Washington Post did a survey where 
they asked that question about race, where they asked that 
question about poverty and poorness, and if these were white 
middle-class people, would they be in this situation, and 76 
percent of African Americans said yes; 21 percent of white 
Americans say yes.
    Well, my goodness, that ought to give us an opportunity to 
respect that opinion and understand, as many of us have been 
pointing out going forward, why we have to be sensitive to 
these issues.
    I am so concerned as we move into the houses, move into the 
reconstruction, the approach of the Administration has been to 
ignore this. The first move was to remove the Davis-Bacon 
requirements that protects the prevailing wage so that people 
can have that and not to require an effort.
    I do not care what you call it, affirmative action, efforts 
to make sure that these were African American people who were 
displaced. Their homes were. Where is the program in there to 
make sure that they are getting a piece of the action to 
rebuild? Are there any efforts within your efforts as we move 
forward rebuilding these communities to make sure that this is 
taken into consideration?
    Because if we do not, this will be a double slap in the 
face to the people who are the most victimized by this tragedy, 
if they again get victimized, be put into these huge 
transitional areas that could become ghettoes, and then not be 
allowed to take advantage of some of the job training programs 
or whatever it takes.
    If I may, Mr. Chairman.
    Chairman Ney. I just want to caution, we are having vote up 
and there are other members. I just want to caution you.
    Mr. Scott. I just want to get a response from you in terms 
of, has anybody given thought to how you can involve and make 
sure that some of the poor, the lower-income folks who have 
been affected in this storm will be able to participate in 
terms of helping to rebuild in the housing area.
    Chairman Ney. I have to hold this for a second here. The 
gentleman is 2 minutes and 44 seconds over. If we have a 
response, other members will be--
    Mr. Scott. Okay, fine. That is okay.
    Chairman Ney. But it is a valid question. We need a 
response, but I do want to just caution on that. That is fine.
    Mr. Davis, before we go on though, I just want to say one 
thing. I think you raise an extremely valid point that has to 
be addressed now. By the end of the day, there is no reason 
that FEMA, HHS, HUD, or someone by 5 o'clock today we will 
place that call, can either tell us how many people are in the 
shelter or a guesstimate or "I do not know."
    So you raised a point out of this that I think can be 
answered by 5 o'clock today, some answer. How many? I don't 
know. We need to pursue that today.
    Mr. Scott. Thank you.
    Chairman Ney. Mr. Davis.
    Mr. Davis of Kentucky. Thank you, Mr. Chairman.
    I think it is clear that because of the magnitude of the 
disaster that there is going to be a creative menu of responses 
dealing with various types of housing questions. I try to look, 
particularly in my region, at practical and workable solutions. 
Oftentimes, they are right in front of our eyes and just 
sometimes the questions are not asked.
    I think the idea of engaging folks in rebuilding their own 
communities is a very, very important thing. But in places like 
New Orleans, to bring in large numbers of temporary housing or 
manufactured housing, trailers, et cetera, would constrain 
transportation efforts, cleanup efforts.
    At the same time to the ranking member's wise comments, I 
think it is inappropriate to build what he called semi-
permanent colonies, literally creating camps in which you have 
to provide utilities, build water infrastructure, 
transportation access, things like that.
    I think we may have in front of us an opportunity. I am 
curious if you have explored--we have mobile home communities 
all over the United States. In particular, one of the areas I 
have interest in are existing slips of availability.
    In my own district, Mr. Nathan Smith, who is a community 
leader, operates a number of mobile home communities, 
manufactured home communities throughout the Midwest. He made 
the comment to us that he would offer existing slips in his 
communities with any type of voucher or Federal reimbursement 
from families.
    One of the things I think that his perspective extends not 
only regionally, but from a national perspective, that there 
should be opportunity to encourage displaced families not to 
end up in camps and clusters of folks with shared experience 
and not necessarily being part of a community, but encouraging 
them to move into established stable communities, versus a mass 
relocation.
    Mr. Roberson, particularly, I was wondering if you might 
comment on what you think the Government should be doing or is 
doing on this front.
    Mr. Roberson. Thank you for that question.
    We have gathered the information from all of the community 
and park operators that are within the affected area and the 
adjacent regions and given that to FEMA so that they can 
understand what potential they have for placement or siting of 
homes there.
    I think that really in reality that that is a decision that 
FEMA and probably others in the Government are going to have to 
make to determine how are you going to displace people. Are you 
going to keep them close to their home or are you going to put 
them in other areas?
    I cannot tell you where to put them, but I can tell you if 
you need them built, we will get them there.
    Mr. Davis of Kentucky. I think you may want to have a 
backup plan, since FEMA appears to be somewhat stressed at the 
moment working with HUD and other housing agencies to make sure 
that word gets out. I just think it is a great idea to put 
people in to established communities.
    One other quick question, just open to the group. In terms 
of reconstruction, particularly from a homebuilding 
perspective, I see just from my own experience in industry that 
possibly billions of dollars of this reconstruction money could 
end up just paying Federal bureaucrats and State and local 
bureaucrats on regulatory compliance that has nothing to do 
with sound science. Particularly, the way I read current EPA 
and Corps of Engineers' regulations, the cleanup will be 
illegal in New Orleans, to do it in a timely manner.
    Are there regulations from a practical perspective that 
without compromising environmental stewardship also encourage 
more rapid rebuilding? Do you think it is appropriate to waive 
or modify local and State code regulations, as well as some of 
the Federal regulations from an EPA, Corps of Engineers 
standpoint, regarding environmental mitigation, particularly 
under the Clean Water Act?
    Mr. Wilson. I think particularly now that the whole city of 
New Orleans is wetlands, so we are going to have to do some 
mitigation there to rebuild on the wetlands. I think from a 
local level that the State and local municipalities can work on 
removing the barriers to housing in the processing of building 
permits, the cost of building permits, the cost of impact fees 
that are imposed upon that create affordability to housing.
    All sorts of those things can be done at the local level. I 
think we need to look at storm water and the EPA rules in 
rebuilding these communities.
    Mr. Davis of Kentucky. I appreciate your group's advocacies 
with us on the committee as well to remove the ephemeral stream 
language from wetlands legislation because what I think it is 
going to do is create an untenable situation for 
reconstruction, to keep working families out of homes.
    I yield back my time, Mr. Chairman.
    Chairman Ney. Thank you.
    Ms. Carson?
    Ms. Carson. Do you advocate relaxing some of the 
environmental rules? New Orleans has been saturated with dirty 
water, et cetera. If somebody goes in to rebuild, do you 
advocate the builders not having to abide by the rigid 
environmental criteria in order to build when they have already 
been affected?
    Mr. Wilson. Congresswoman, what I am saying is, the city of 
New Orleans, it seems to me, should be determined a wetlands 
like the rest of the portion of the State. It is 12 feet below 
the water level of the ocean, 12 feet below sea level. You are 
going to have to look at that.
    Would I be allowed to build in another State in another 
location that was prone to flooding? They would probably make 
me build the floor two feet above the 100-year flood plain. So 
I think you have to address those issues in the city of New 
Orleans in the enforcement of Federal regulations as it affects 
wetlands and how you are going to deal with that.
    I certainly do not subscribe to removing any environmental 
laws or anything like that, but if you want to rebuild New 
Orleans and Mississippi and Alabama in these areas that have 
been affected, you are going to have to reduce Government 
regulations to help people get back in their homes where they 
came from.
    Ms. Carson. I yield back, Mr. Chairman.
    Chairman Ney. Mr. Sanders?
    Mr. Sanders. Thank you, Mr. Chairman.
    I want to thank all of our panelists for being here with us 
today.
    Ms. Roman mentions that on any given night, there are some 
250,000 Americans who are homeless, and that is before Katrina. 
So obviously what we are seeing is a crisis in America being 
made worse with the hurricane.
    What I would like to get some thoughts on from our 
panelists is, given the housing crisis that we had before 
Katrina, given the fact that as I understand it that in the 
course of the year some 2.5 million Americans will experience 
some degree of homelessness, given the additional major 
problems that Katrina is causing in terms of homelessness, what 
as a Nation are we going to do to finally address the huge 
housing crisis that we have in America for low-income people?
    Now, it seems to me pretty clearly, especially with poverty 
increasing in America, that the Federal Government is going to 
have to play a dramatic role if we think that children should 
not be sleeping out on the street. Again, Katrina makes the 
need to respond even more dramatic.
    Let me start off with Ms. Roman.
    If this Congress actually believed that we should not have 
homelessness, if we actually believed that low-income workers 
should not be asked to spend 50 percent of their income on 
housing, if we actually believed that this country should be 
building large amounts of affordable housing and, as Mr. Scott 
said, put people to work at good wages in building that 
housing, if by some chance Congress thought we should do that 
rather than giving tax breaks to billionaires, what should we 
be doing?
    Ms. Roman?
    Ms. Roman. I think it is important to use this opportunity 
to point out that tens of thousands of people are vulnerable to 
any kind of disaster because of their poor housing and what 
kind of assistance they need.
    Of course, we have millions of people who are at risk of 
homelessness, 750,000 a night, 3 million a year. We need a 
significant investment in housing to help people stabilize 
their lives.
    Mr. Sanders. Do you believe that the Federal Government 
should be pouring substantial sums of money into addressing the 
housing crisis?
    Ms. Roman. Yes, I do.
    Mr. Sanders. Okay.
    Mr. Alvarez, what do you think?
    Mr. Alvarez. Yes, sir.
    Let me just briefly give you a description of San Antonio. 
We support 25,000 families currently. We have approximately 
23,000 families still waiting for assistance.
    Mr. Sanders. Almost as many waiting as are in public 
housing.
    Mr. Alvarez. That is right. And we received 13,000 evacuees 
into San Antonio. When they arrived, we only had 75 units of 
public housing that they could go to.
    Mr. Sanders. And I suspect there was resentment on the part 
of some of the locals.
    Mr. Alvarez. Absolutely. So I think and NAHRO's position is 
that we need to create a production program and focus on 
housing becoming a fundamental component of decent, safe, and 
sanitary living anywhere in America.
    Mr. Sanders. I should mention to you that I introduced, 
with over 200 cosponsors, a National Affordable Housing Trust 
Fund last year, which, unfortunately, despite widespread 
bipartisan support, did not get through the leadership.
    Let me ask Ms. Daly, what do you think?
    Ms. Daly. Mr. Sanders, I think we need a lot of tools, as 
Mr. Alvarez and others have mentioned. We need many, many 
tools. But the thing that is lacking right now is a production 
program for very low-income families with children.
    Mr. Sanders. My understanding is that we are building 
almost no low-income housing. Am I correct?
    Ms. Daly. For very low-income families with children, it is 
very low. We are still building some 202 housing. There is 
still low-income housing being created because of the low-
income housing tax credit. But those programs have not produced 
increases in housing for the lowest-income families with 
children. We do not want to concentrate them in public housing 
projects. We need to figure out how to do that.
    Mr. Alvarez's members and nonprofit organizations across 
the country that have a lot of experience running the 202 
program for elderly and disabled, could duplicate that 
experience for families with children, but it will not happen 
without the Federal investment.
    Mr. Sanders. The bottom line is we need massive housing 
production for lower-income people.
    Ms. Miller?
    Ms. Miller. Sir?
    Mr. Sanders. Yes. What do you think?
    Ms. Miller. There is definitely a very strong need for 
affordable housing, not only in our States, but in the entire 
country.
    Chairman Ney. I am sorry. The time has expired, and I need 
to move on to two members prior to the bell.
    Mr. Sanders. Thank you, Mr. Chairman.
    Chairman Ney. Yes, Mr. Cleaver and Mr. Clay?
    Mr. Cleaver. First, a very short statement. I am concerned 
about the relaxation of any environmental laws. We are setting 
people up to be flooded again. If we are losing 35 to 40 miles 
of wetlands a year, and the wetlands soak up the storm waters, 
we are setting the people up again. Of course, I think that is 
tragic.
    My question is this. Having grown up in public housing and 
having seen in Israel, the State of Israel, bringing in the 
Ethiopian refugees and placing them in some prefabricated 
housing, where the Russian immigrants, the Jewish Russians who 
have come to Israel were given, let's use the term "public 
housing" in the three major cities, and then when the 
Ethiopians came, they moved them in, and there was chaos, 
chaos.
    Don't you believe that if we start bringing the evacuees 
into communities where there is existing housing, whether it is 
trailer parks or public housing, that we are going to have some 
problems, some serious problems?
    Thank you.
    Anybody else?
    Mr. Clay. No one wants to tackle that one, Congressman.
    Let me just real quickly, may I thank Ranking Member Waters 
and the chairman for allowing me to sit in on the hearing.
    Just one quick question for Mr. Roberson.
    We have far in excess of 250,000 homes destroyed by the 
hurricane. We have over 1 million people displaced. We have 
shortages of skilled labor, lumber, bricks, and many other 
building materials. You have many suggestions for alleviating 
these problems. We also have high unemployment among the 
citizens that live in those areas, many of them skilled 
construction laborers, plumbers, electricians, and the like.
    Will they be hired? Will you have a priority on hiring, 
with the requisite skills that you are looking for? Go ahead.
    Mr. Roberson. Certainly, we are always looking for the 
opportunity to hire skilled labor in our factories. I do not 
know whether these people will be located adjacent to be able 
to be hired, but we are always looking for qualified people.
    I think what I was trying to get to earlier today, but ran 
out of time, is that as you look at the rebuild of the Gulf 
South region there and the city of New Orleans, one of the 
things manufactured housing can bring to the table to help 
assist that area is that because you can have the combination 
of off-site and on-site construction, with product that is 
aesthetically suited for the environment that it is going to be 
placed in.
    That is certainly capable in a factory-built environment 
because you can then utilize the resources of local employment 
for some of those trade areas, and you can use less-skilled 
labor because part of those trades move into a factory 
environment that we can speed up the process, that we can help 
people get into housing with more affordability, that that we 
can help New Orleans recover faster if there is a role played 
by manufactured housing, and we look beyond the fact that we 
all think that a house trailer is what we do not want. This 
industry has tremendous capabilities to build product that is 
very suitable, and we can do it quickly and we can do it more 
affordably than site-built.
    One of the major problems, though, that we still need in 
that regard to do it is we have to look at two issues: one, our 
outdated zoning restrictions in many areas and another is we 
really need Congress to look at sponsorship through the GSEs 
and FHA financing to just give us equal footing with site-
builders. The GSEs were started to give priority for affordable 
housing. We make the most affordable housing, but we have the 
most onerous underwriting standards, the toughest appraisal 
standards. We are discriminated against.
    We have people today that cannot buy a manufactured home, 
but they will finance a site-built home. Something needs to 
change about that. I do not know how to do that unless Congress 
steps in. I believe that if you will look at those issues, you 
can see manufactured housing can play a vital role over time to 
the rebuild of that Gulf Coast and to solving a lot of the 
other affordability issues for America in general. We have 
raised all these issues and we have a big piece of the pie that 
needs to be looked at, but it is being overlooked.
    Mr. Clay. Thank you for that response.
    Thank you, Mr. Chairman and Ranking Member Waters.
    Chairman Ney. Thank you.
    I want to thank the panel. Again, we were going to try to 
get an answer today on the numbers. I think it is a very valid 
point. We want to work with you, too, in a rapid way with your 
issues. I thank you so much for your time.
    When we come back from the two votes, we will go on to 
panel two.
    Thank you to everyone.
    [Recess.]
    Chairman Ney. We will begin with panel two.
    The first witness is Clanton Beamon. Clanton Beamon is the 
executive director of the Delta Housing Development Corporation 
in Indianola, Mississippi. The corporation was formed over 30 
years ago as a response to a tornado which leveled the 
Mississippi delta town of Inverness, leaving hundreds homeless. 
He is testifying today on behalf of the National Rural Housing 
Coalition, an organization which promotes better housing and 
community facilities for low-income rural people.
    Jeff Brodsky is the president of the Related Management 
Company in New York City. He oversees the company's property 
management activities. Mr. Brodsky is testifying today on 
behalf of the National Multi Housing Council and then National 
Leased Housing Association, whose goals are the provision and 
maintenance of quality affordable rental housing for low-and 
moderate-income Americans.
    Judith Kennedy is the president and CEO of the National 
Association of Affordable Lenders. The association's 200-member 
organizations are comprised of banks, thrifts, insurance 
companies, community development corporations and pension funds 
committed to increasing private lending and investment in low-
and moderate-income communities.
    Michelle Norris is senior vice president of development of 
National Church Residences. She is testifying on behalf of the 
American Association of Homes and Services for the Aging, whose 
members sponsor and manage affordable housing for seniors.
    I want to welcome all the witnesses.
    We will begin with Mr. Beamon.

  STATEMENT OF MR. CLANTON BEAMON, EXECUTIVE DIRECTOR, DELTA 
   HOUSING DEVELOPMENT CORPORATION, INDIANOLA, MISSISSIPPI, 
  TESTIFYING ON BEHALF OF THE NATIONAL RURAL HOUSING COALITION

    Mr. Beamon. Thank you. Mr. Chairman, we have all been 
horrified and humbled by the extent of the destruction wrought 
by Hurricane Katrina on our southern coastline, particularly in 
the States of Mississippi, Alabama, and Louisiana. We pray for 
all those affected by this tragedy.
    In my home State of Mississippi alone, more than 115,000 
evacuees are in shelters or temporary locations arranged by the 
Red Cross, and many more are in hotels and private homes.
    Right now, the pressing need is for more temporary housing, 
both for displaced families and for relief workers. As of 
Tuesday, September 13 in Jackson, 1,250 trailers or mobile 
homes had arrived at a central staging area; 135 were ready for 
occupancy; and 20 were already homes to families in hard-hit 
Biloxi, where at least 5,000 homes and buildings were 
destroyed.
    We have a lot of work to do before we meet the space goal 
of 10,000 temporary shelters for displaced families and workers 
by the end of the month. In response to Hurricane Katrina, we 
at Delta Housing Development Corporation, like many housing, 
religious, and other organizations across the region and the 
Nation, are trying to do our part. On September 1, DHDC had a 
total of 18 vacancies.
    We contacted USDA Rural Development and requested 
authorization to waive standard requirements of waiting lists, 
security deposits, credit checks, and income verifications in 
order to place Katrina evacuees on a priority basis. I received 
word the same day that the national office of Rural Housing 
Services had already sent directives to its State offices with 
instructions on how to assist Katrina evacuees in their 
financed housing units. We have since filled our 18 spots.
    Our next contact was National Equity Fund and Mississippi 
Home Corporation to get authorization to house the evacuees in 
our low-income housing tax credit development where we had six 
vacancies. The request was approved immediately.
    On Friday, September 9, 2005, we received notification from 
the Foundation of the Mid-South that Delta Housing had been 
designated to receive funds from the Walton Family Foundation 
and disburse it to families and churches that are providing 
housing and food to the evacuees.
    Additionally, we have been collecting donations from local 
churches to assist families with utility deposits, collecting 
food and clothing, and partnering with other groups such as the 
local Community Action Agency to provide families with rental 
assistance.
    I would like to share with this subcommittee my first 
encounter with a family displaced by Hurricane Katrina.
    On Friday, September 2, I met with Doris, a single mother 
and her 10 children. Through our conversation, I determined she 
was living in an apartment owned by the New Orleans Housing 
Authority and supported by Section 8. I reasoned that there was 
a good chance she would receive another Section 8 voucher at 
some point in the future, and I invited her and her family to 
stay in one of our four-bedroom apartments that we had vacant. 
I told her we were going to have to walk out on faith in hopes 
that help would come later. She was very appreciative and very 
emotional, and so was I.
    While Mother Nature does not know rich from poor when she 
unleashes her fury, it is undeniable and troubling that the 
majority of those affected by Katrina were among our Nation's 
poorest individuals and families even before the storm hit.
    The vast majority of the people affected were living in 
poor, primarily black, non-metro counties and suffered from a 
lack of affordable, decent housing. In fact, before Katrina, 
two-thirds of rural America's occupied substandard housing was 
located in the 16 States that make up the Southeast and 
comprise Alabama, Louisiana, and Mississippi. Over 40,000 
households live in units without adequate plumbing, and over 
100,000 people rely on USDA direct and guaranteed loans and 
other assistance just to remain in their homes.
    You have my written testimony, and I will just stop and 
make some general observations on what is needed next.
    In our encounter with the evacuees in Mississippi, the most 
pressing need right now is furniture. We have vacant units to 
put them in, and that is good for a person that had nowhere to 
go, but you put them in an apartment with only a stove and 
refrigerator. That means we have a long way to go.
    Hopefully, FEMA and others and private sources can make 
some kind of arrangements to make available to these evacuees 
furniture, not just blankets and inflatable mattresses and 
mats, but at least at a minimum box springs and mattresses.
    Of course, we need to look at some other recommendations. 
Before the storm, over 40,000 households in the three States 
lived in units without adequate plumbing. USDA currently has 
50,000 low-income direct loan borrowers in the hardest-hit 
areas. There are approximately another 50,000 recipients of 
guaranteed loans, and about 10,000 low-income assistance 
recipients are in coastal areas. Displacement is expected to be 
widespread.
    Obviously, we need better coordination between Federal and 
State agencies and outreach by such agencies as FEMA, HUD, and 
USDA to get families helped now. That help should include 
Section 8 vouchers, Rural Housing Service vouchers, and in 
addition programs like RHS Section 523, supervising and 
technical assistance grants can be an important way to provide 
support to local nonprofit community development organizations 
in their work on the ground.
    The need for greater assistance is particularly acute in 
rural areas, and any assistance should reflect the immediate 
need and a long-term commitment to rebuilding. In the short 
run, the goal is to repair up to 10,000 units of housing, get 
families 5,000 vouchers, and provide sources for repair of 
multi-family projects. The long-term goal is to finance the 
development of over 20,000 units of single-and multi-family 
housing for rural areas of States hit by Katrina.
    With that, Mr. Chairman, I am honored to have had the 
opportunity to come before your subcommittee to appeal for some 
assistance for people that are very desperate. We all want to 
help.
    Finally, you know, God decided to give us something that is 
going to probably rearrange our way of thinking for a long time 
to come.
    Thank you very much.
    [The prepared statement of Clanton Beamon can be found on 
page 73 in the appendix.]
    Chairman Ney. Thank you.
    Mr. Brodsky?

    STATEMENT OF MR. JEFFREY I. BRODSKY, PRESIDENT, RELATED 
MANAGEMENT COMPANY, LLC, NEW YORK CITY, NEW YORK, TESTIFYING ON 
   BEHALF OF THE NATIONAL MULTI HOUSING COUNCIL AND NATIONAL 
                   LEASED HOUSING ASSOCIATION

    Mr. Brodsky. Chairman Ney, my name is Jeff Brodsky and I am 
the president of Related Management Company. My division owns 
and manages 25,000 apartments in 135 locations in 11 States of 
affordable and market-rate housing. Today, I am representing 
the National Leased Housing Association, the National Multi 
Housing Council and the National Apartment Association.
    I commend you, Chairman Ney, for your leadership, and we 
thank the members of the subcommittee for your valuable work 
addressing the important issue of housing the hurricane 
evacuees.
    In particular, we want to commend you, Chairman Ney, for 
convening the recent roundtable discussions on the issue of the 
hurricane and what the housing sector can do to assist.
    Moving displaced families from temporary shelters into more 
suitable housing is the first step in rebuilding the thousands 
of lives affected by the storm. These are extraordinary times 
that call for both the private sector and Federal, State, and 
local governments to respond accordingly. The apartment 
industry stands ready to aid in those efforts.
    However, our ability to meet these housing needs is 
severely restricted because thousands of the apartments 
potentially available to Katrina's victims receive some form of 
Federal support and as such as subject to Federal regulations 
that restrict the use of the properties and impose time-
consuming administrative burdens on the property owners prior 
to leasing these units.
    Therefore, we are requesting as applies to Katrina evacuees 
a temporary emergency waiver of all program requirements for 
properties funded with the proceeds from multi-family tax 
exempt bonds, properties financed by the Federal Housing 
Administration, properties that receive HUD subsidies or Rural 
Housing Service assistance, or are subject to Treasury rules.
    A broad waiver is necessary to maximize the number of units 
that can be made available to those in need. Otherwise, many of 
the properties would remain off-limits due to regulatory 
restrictions. It is not unusual for an affordable housing 
development to blend the benefits of IRS tax exempt financing, 
FHA mortgage insurance, HUD rent subsidies, soft-debt source 
from community development funds, and real estate tax 
abatements from local communities in the same property.
    Unfortunately, distinct occupancy restrictions are applied 
to the properties for each of these program resources. The 
apartment communities covered by these Federal programs include 
millions of market-rate and affordable units owned by private 
for-profit and nonprofit organizations and public entities. The 
programs are too numerous to list and extend from mortgage 
insurance to mortgage interest subsidies, from HODAG to HOME to 
HOPE VI, from Section 8 to Section 236 to Section 515 and 
Section 42.
    To free up the supply of housing for hurricane victims, we 
request a broad comprehensive waiver of all program rules for 
Hurricane Katrina evacuees. This emergency temporary action 
will allow the industry to respond to the crisis in a more 
immediate and effective manner.
    A step was taken toward that goal on September 9 when the 
IRS issued Notice 20569. The notice authorized State housing 
credit agencies to permit temporary housing of individuals 
displaced by Katrina in low-income housing tax credit 
properties and temporarily suspended income limitations and 
non-transient requirements. While this is a good first step, it 
does not go far enough.
    For example, the notice specifically authorizes a waiver of 
occupancy limits in creating a temporary housing period not to 
extend beyond September 30, 2006. However, the actual temporary 
housing period is to be determined individually by dozens of 
separate State housing credit agencies, and they in turn may 
determine the appropriate period for temporary housing for each 
individual project.
    In effect, despite the good intentions of the IRS, the 
owners of thousands of low-income tax credit apartments cannot 
even now list their apartments as available, as they have to 
wait for each State and local agency to issue their individual 
guidance.
    In order to receive the benefit of these waivers, State and 
local participating agencies must adopt the Federal waivers in 
the form they are issued as soon as possible. Further, State 
and local agencies must adopt parallel waivers for their own 
non-Federal program occupancy limits if property owners are to 
effectively place these units into use.
    As you are aware, a significant number of privately owned 
properties with Section 8 assistance, as well as public housing 
units, were destroyed by Hurricane Katrina. The funding of the 
housing sources and subsidies has already been appropriated. We 
urge Congress to ensure that Section 8 project-based assistance 
contracts are frozen or suspended to prevent them from expiring 
while the properties are being rebuilt and, if necessary, 
facilitate the transfer of such contracts to other properties.
    Affordable housing providers of both privately and publicly 
owned development have an inherent capability to address the 
immediate housing needs of the evacuees. They are trained and 
experienced in serving the needs of diverse occupant groups. 
They routinely partner with Government agencies and have 
longstanding relationships with local faith-based, nonprofit 
and government social service providers that may ease the 
transition of families who want to enter new communities. Our 
resources are a natural fit for this urgent housing need, as 
long as regulatory obstacles are removed.
    Building owners want to do the right thing. We are ready to 
accept the business risks and potential cost inherent in the 
outreach, including the unclear funding of rent, discounted or 
not, the inability to perform typical background checks on 
occupants, and resistance from financial partners.
    However, we cannot do it alone. We respectfully request the 
Congress pursue the removal of Federal program barriers to our 
participation that currently do not allow owners to respond to 
this crisis efficiently and quickly.
    Thank you for the opportunity to express our views.
    [The prepared statement of Jeffrey I. Brodsky can be found 
on page 83 in the appendix.]
    Chairman Ney. Thank you.
    Ms. Kennedy?

STATEMENT OF MS. JUDITH A. KENNEDY, PRESIDENT AND CEO, NATIONAL 
           ASSOCIATION OF AFFORDABLE HOUSING LENDERS

    Ms. Kennedy. Thanks so much.
    As usual, after one of your provocative roundtables, the 
vanguard that is the NAAHL membership got together to discuss 
some of the challenges you have thrown to us. Our membership 
was initially banks, but in addition to the major banks, our 
members now include the 50 blue-chip nonprofits that lend and 
invest in low-and moderate-income communities.
    We much appreciate the experienced staff on both sides of 
the aisle who have been bipartisan in supporting our efforts to 
get some order out of this chaos.
    In essence, I have to applaud your leadership, but I almost 
feel like the committee is asking you to reinvent a wheel, a 
wheel that worked, and you know it from your own disaster 
experience in the Ohio Valley, and I know it.
    II would say if history is any guide, West Virginians want 
to go back to the hollows; Ohioans want to go back to the river 
valley; and, of course, southerners will want to go home.
    But the difference between this disaster and previous 
disasters is that by now in other disasters, 2 weeks after 
displacements, families would have met with a Federal counselor 
who would have told them what they were entitled to as 
citizens. They could have made the decision about whether or 
not they wanted to stay near Louisiana in a mobile home or 
relocate to their aunt's house in Utah for the duration. Once 
they got into a stable situation, they would look for permanent 
housing. And that is when, of course, all of the vouchers come 
into play.
    I will say that you definitely asked the right questions 
for this hearing because in addition to waivers, what I learned 
is that there are units available in parts of the country, and 
FEMA has finally as of Tuesday provided some temporary housing 
vouchers.
    In Alabama on Tuesday, once the word went out that FEMA 
would pay for rent up to 90 days and utilities, I am told that 
immediately landlords drove to Baton Rouge, Louisiana, to the 
mass shelter and asked people if they wanted to relocate to 
Alabama.
    So not only do citizens have the right to make the decision 
about where they want to go temporarily and permanently, the 
private sector will respond if the waivers that Mr. Brodsky 
described are provided and FEMA cooperates.
    So we are going to say, do not rob Peter to pay Paul. 
Obviously, this monumental disaster requires additional 
resources. It is not fair to take families off a waiting list 
in Boston because of an influx from Louisiana, but with 
reliable voucher funding and emergency vouchers for disaster 
victims, the private sector will respond.
    There are minor statutory changes you could make that could 
have a significant impact. One I learned about from the 
recommendations of the Comptroller of the Currency. Some banks 
are already at a statutory maximum of 10 percent invested in 
what are called "public welfare investments." This ceiling has 
not been increased since 1992. If you take it up to 15 percent, 
that will help a lot of banks to respond to this crisis. So 
this is an important and noncontroverisial provision.
    Another suggestion is to enact quickly the multifamily 
affordable housing goals in the committee's GSE bill. I give 
you great credit for these and then Senators Santorum, Reed, 
and Sarbanes agreed with it on the Senate side. The housing 
goals for Fannie Mae and Freddie Mac are revised in your 
proposed GSE bill to focus them on low-and moderate-income 
housing. What I have learned from my members in the week since 
your roundtable is the expectation is that if we thought the 
needs for private capital were huge before this disaster, the 
needs are geometrically greater now.
    Let me use one example. A nonprofit comprised of banks from 
Alabama has been able to do $50 million worth of low-income 
housing in the last 5 years.
    I have to disagree with something that was said on the 
prior panel. Housing is being built for very low-income 
families. My nonprofit members have about 90 percent of their 
units affordable to people under 50 percent of area median 
income, but they have no national secondary market to sell 
those loans to. So if Alabama were to be able to sell loans to 
Fannie Mae and Freddie Mac, that is $50 million tomorrow that 
would be available with additional vouchers to make new housing 
in Alabama.
    So those are I think noncontroversial simple changes you 
can make that will have enormous impact.
    There are definitely other pending bills proposing 
resources that would make a huge difference. Mr. Reynolds and 
Mr. Cardin have introduced in the House the Renewing the Dream 
tax credit bill that Senator Santorum has introduced for three 
Congresses now. It subsidizes the gap between the cost to 
rehabilitate a house and what the family can afford. It would 
make a huge difference in these disaster States where the cost 
of land is so low.
    You have asked us, and thank you for doing it, what to do 
to make relief efforts more efficient and effective. I think 
this has been well explained. I want to leave you with a huge 
consideration that came out of your roundtable. What will be 
the impact of rising energy costs on providing housing 
assistance in the short term and in the long run?
    What I learned from the southerners is that although they 
rely on electricity now, they really believe in Alabama, 
Louisiana, and Mississippi that once the cost of fuel oil and 
natural gas starts to increase, their low-cost electricity will 
necessarily be bid up by the northern States where people are 
switching to electricity because they cannot afford the oil and 
the gas.
    So what you are looking at in the disaster-stricken States 
is energy costs tremendously increasing; obviously construction 
materials and labor costs are also increasing. But honestly, my 
members see this cost pressure affecting the entire country. 
They see that the cost of production and the cost of 
maintaining affordable housing is going to be higher.
    So let me give you one simple example of this impact. Right 
now, there are developers in the pipeline with tax credits and 
Section 8 vouchers ready to go to build housing affordable for 
low-income families, elderly and disabled. Chances are that 
some of those deals will no longer be feasible.
    Deals that are currently pending, using already-
appropriated Section 8 and tax credits, are probably going to 
need to go back to the drawing board and get more subsidy. We 
are going to need your help with that.
    We look forward to working with you both on this emergency 
issue where FEMA just needs to go back and resume what HUD was 
doing magnificently before to provide emergency housing, and on 
providing permanent housing, where obviously resources are 
going to be the key.
    [The prepared statement of Judith A. Kennedy can be found 
on page 139 in the appendix.]
    Chairman Ney. Thank you.
    Ms. Norris?

  STATEMENT OF MS. MICHELLE NORRIS, SENIOR VICE PRESIDENT OF 
 DEVELOPMENT, NATIONAL CHURCH RESIDENCES, TESTIFYING ON BEHALF 
OF THE AMERICAN ASSOCIATION OF HOMES AND SERVICES FOR THE AGING

    Ms. Norris. Thank you, Mr. Chairman.
    My name is Michelle Norris. I am here on behalf of the 
members of the American Association of Homes and Services for 
the Aging.
    AAHSA serves 2 million people every day, 5,600 facilities 
across the country. It represents mission-driven nonprofit 
organizations. We have facilities across the continuum that 
were impacted by the hurricane and the flooding.
    My real job is as senior vice president of development for 
NCR, National Church Residences. We are one of the Nation's 
largest nonprofit developers and managers of affordable 
housing. We are in Columbus, Ohio. We have properties in your 
jurisdiction.
    In addition to building affordable housing throughout the 
United States in 26 of the States, we also have a nationally 
recognized social service program and we serve the mission of 
supportive housing for seniors and also for families. We have 
service coordinators in almost every one of our facilities 
funded by either Federal or local grants.
    My written testimony speaks about the seniors that have 
been affected, but I can also tell you because we have families 
that most of our recommendations affect the families that are 
hit as well. Since many people have already spoken and told 
you, a lot of the recommendations in my written testimony have 
so many technical recommendations, I thought I would kind of 
try to wrap up with a couple of key points that I have heard 
and I feel like we have seen.
    The first one is one that was already mentioned by Mr. 
Brodsky. That is that regulations right now can stop good works 
from happening, pure and simple. There are regulations that are 
still out there that are stopping it from happening. I can give 
you one example. We have a senior high-rise that was 25 years 
old, senior Section 8, and we just went through a $6 million 
rehab. Because of that, we had 40 units that were set aside 
that had not been occupied yet. Wow, this is great. We could 
actually help seniors move into a project-based Section 8 
community right away.
    When we talked to our HUD office, the answer was we cannot 
do that because they cannot use it unless you can verify then 
that they are going to be permanent residents; they cannot use 
the Section 8.
    Chairman Ney. I am sorry. Where is the unit at?
    Ms. Norris. The unit is in Georgia.
    So again, the issue is that they do not want to use the 
project base. They want to make sure there is a secondary 
voucher fund that is available for the residents, again a 
conflict between FEMA and HUD in terms of who is going to pay 
for those temporary vouchers.
    The second example I have is one that was also alluded to 
by Mr. Alvarez. That is, we have got to move quickly. The 
regulations, of course, set that aside for a minute.
    There is a great example in Columbus, Ohio, that I think 
this is happening just like in San Antonio. Agencies got 
together in a place called the Piedmont Center. CMHA came, the 
housing authority, all the service providers, and they did a 
one-stop shop. They are getting people in. They are helping 
them enlist. They are getting them FEMA-registered. They are 
going through the whole process, including getting them to walk 
out with a voucher.
    The only problem is we have 3,500 people that have already 
arrived in Ohio. They have 100 vouchers available at CMHA. So 
their concern, again, is if they start over-leasing on their 
vouchers, then who is going to pick up that bill? It is just an 
undecided answer, so we cannot quickly help people move.
    The third example I have is what NCR does and what AAHSA is 
all about is service-enriched housing. The folks that are 
moving into these facilities right now, we took people that 
came out of that Piedmont Center and we moved them to one of 
our properties, actually four families. We moved them into our 
property, but we gave them the unit and they have nothing. They 
have absolutely nothing. They have a 3-month-old and they have 
two 18-year-olds. They have nothing but the clothes on their 
back--no furniture, no plates for the kitchen, nothing.
    So we are working very hard with our social service folks 
to help those people re-establish their lives. They have no 
connection with their families, and they need to be able to get 
stability. There are some amazing stories that are going on out 
there, but they are one at a time.
    In addition to the housing, one of the other gentlemen 
asked about how do we help these people. It is about also 
getting them services. There is a great program that HUD has 
called Service Coordination. If we could expand that, allow it 
to be taken and moved and help these folks, that would be a 
fabulous way of doing it.
    So there is a lot of stuff that is out there that is good. 
I see it happening. It is happening at the local levels. But 
the end answer is that people are still waiting on saying, 
well, how is FEMA or HUD going to help us fund these 
initiatives that people are doing? With that, I can tell you 
that there are a lot of folks out there, especially in the 
nonprofit world, that are very much willing and wanting to 
help. We have the mechanisms, and we are very thankful for this 
opportunity.
    Thank you.
    [The prepared statement of Michelle Norris can be found on 
page 153 in the appendix.]
    Chairman Ney. I wanted to mention, the roundtable has been 
mentioned, and I appreciate your comments on it. I did the 
roundtable on this because the roundtable is less formal. Some 
people said an agonizing 3 hours, but you know, that is okay. 
People are in trauma. I think people appreciate the 
roundtables. We had bipartisan participation.
    But the roundtable allows you to have in a setting, one 
person will say one thing, and then they come back and somebody 
else can merge on that. You went back to your members. You get 
ideas that can come to us. So I think the roundtables were 
productive. The hearings are good. You get it on the record and 
we can help each other to help people.
    I think out of the roundtables it also wakes us up to the 
fact, and some statements you made today, as you find these 
things out, please, our staffs work together completely, 
Democrat and Republican, on these issues. When you find out, 
call, because you are probably going to find out before we find 
out. We are not going to get a call from the executive 
bureaucracy saying guess what, we cannot get dishes to people 
today. We are not going to get those calls. So if you can 
continue to do that, that is going to help us to help people, 
and I thank you for that.
    I have a couple of questions, starting with Mr. Beamon.
    I know Mississippi has had devastation, as have Alabama 
and, of course, Louisiana. We have heard a lot of conversation 
obviously about the shelters in Louisiana, New Orleans, and the 
surrounding areas.
    Is the same situation occurring in Mississippi or not? Do 
we have any idea of how many people are in shelters? Are the 
same problems occurring? Do you have any comment on that issue?
    Mr. Beamon. Yes. You have people in shelters throughout the 
area that was devastated. As for Jackson, the State capital, 
there were hundreds of people housed in the coliseum. We had a 
nursing home, an assisted-care facility, that was without 
electricity. That got quite a bit of publicity because the 
people were saying, the patients were saying that everybody 
around them had electricity and they could not figure out why 
they did not have it. But there are shelters in other areas 
other than Jackson, and they had the same problems.
    Chairman Ney. You also were saying, though, that there were 
a certain amount of units available and open that Section 8 
could utilize. Is that correct?
    Mr. Beamon. Very few.
    Chairman Ney. Very few.
    Mr. Beamon. You have to understand, we had a severe housing 
shortage in our area before Katrina, so it is even worse now. 
But we had 18 units available on September 1, and just in 
Indianola, which is 270 miles from Gulfport, and 350 miles from 
New Orleans. People stopped all the way from those areas until 
they got to us, and we only had those 18 units. For a couple of 
days and nights, I probably was the most popular man in town. 
At least we had something.
    But you still have several hundred people in the area 
living with families and in hotels paid for by FEMA and the Red 
Cross. But we still have a serious, serious problem. Most of 
our school districts, this is another area that we are going to 
get tested on. Most of our school districts are underfunded 
anyway. Now, you have people in the area now having to start 
school. We have the same problems, but not of the magnitude 
that some areas have.
    Chairman Ney. Thank you.
    Mr. Brodsky, I think you made a statement about broad 
waiver authority. I was just asked a question as we broke for 
the votes about that. The statement came out of the White House 
about waivering.
    The only thing I was responding to out in the hallway when 
I was talking to people who were questioning me on this, almost 
a case-by-case--I guess I am speaking as a Member of Congress--
a case-by-case waiver in the sense, not person-by-person, but 
issue-by-issue.
    My definition of "broad" is that the executive says we are 
waivering everything, and how do we know that their waivering 
is the right thing to do for the short term and long term.
    So, for example, I know emergency vouchers have to happen 
yesterday. I know that. Congress has to move on that. The magic 
number, what it is, I do not know.
    But when you say "broad waivers," what areas are you 
talking about?
    Mr. Brodsky. Thank you, Mr. Chairman.
    The primary issue has to do with who is allowed to occupy 
units. Every single funding methodology that comes from the 
Department of Agriculture from Rural Housing through HUD 
programs through the IRS programs, all of them provide some 
form of support in return for a restriction on who is occupying 
the unit.
    All we are saying is take away those restrictions so I can 
put evacuees in there, because I cannot verify their income. I 
cannot verify who they are sometimes. And make it as clear-cut 
and as broadly characterized as you possibly can, that you do 
not have to follow all these rules on who is allowed to occupy 
the unit. There are too many to list.
    What is happening is the Federal, to some extent the IRS, 
has issued guidelines relating to one program, but there are 
dozens of programs. They apply to market-rate housing and they 
apply to affordable housing, more so to affordable housing, 
clearly.
    Examples of the kinds of things that go to occupancy rules, 
there are tenant-selection plans; there are waiting list 
programs; there are preferences that are in certain documents; 
there are income restrictions; there are verification formats; 
there are reporting guidelines. I could spend days just 
identifying what all the requirements are.
    Just waive anything that relates to who is allowed to 
occupy the space on a temporary basis for a determined amount 
of time. The impression that I would provide for you is simply 
if the IRS has said that is available to them under certain 
limited waivers through September 30, 2006, that allows the 
industry to put people in there and basically say, you can stay 
here. I would suggest that if it gets to 2006 in September and 
they are then qualified to follow all the program guidelines, 
that they could apply and stay, because after all, we are 
trying to provide resources for them to be stable households, 
not transitional households.
    Chairman Ney. So it would be a waiver with the condition 
that they are a victim of a disaster in one of the States.
    Mr. Brodsky. It would be characterizable evacuees, and 
there are a number of ways that the Federal Government can 
characterize what is the definition of an evacuee, and there 
are different issues coming out of different agencies at the 
moment to define that. But let the owners then take all the 
rest of the risks.
    We do otherwise have other risks, but the point is get the 
barriers out of the way so that we can then say, okay, there is 
a Web site, hurricanehousing.com, that has not been promoted. 
That is a national Department of Homeland Security-designated 
Web site for owners to put on there where they have apartments 
available nationally. But the owners are not going on there 
because in many cases they are restricted from doing so.
    So just remove the barriers and the goodwill of the stable 
apartment communities that have availability, not just 
immediate availability, but people do move out and there are 
vacancies over time. Let the people go where they want to go; 
provide a resource where they can see where there are 
apartments available.
    This does not solve all the problems, obviously, but this 
is from a long-term housing opportunity standpoint, it gets you 
out of a shelter. It gets you out of temporary involvements. It 
puts you in a community where your kids are going to school and 
you can live. And then you can decide if you want to stay there 
or not longer-term, so you do not have to deal with the problem 
a second time, when they decide they want to go someplace else.
    So those are the kinds of waivers that we are looking for. 
Unfortunately, there are dozens and dozens and dozens of 
waivers. I believe that Congress could authorize the entire 
program listing of occupancy waivers if they wanted to and then 
ask the States to do exactly the same thing. The IRS simply 
said to the States, you are authorized by us to waive these 
things if you want, but now we have to wait for the States. I 
know you cannot control that, but you could certainly promote 
it.
    Chairman Ney. So our waivers could be done 
administratively, but some require the statute change. We are 
meeting today with FEMA. We are communicating with HUD. The 
purpose of that meeting today is to try to go through the 
waiver discussion ASAP to see what we can do to be able to get 
people some immediate relief.
    Ms. Kennedy, you raised the issue of the GSE bill. As you 
know, I was tasked by Chairman Oxley to work on that, and our 
staffs all worked on that, minority and majority staff. I think 
we produced a very decent product. It ran into a firestorm of 
controversy, as you know, and now is moving, which is great. 
The entire GSE bill is moving.
    The question I want to ask you is, how much impact? We have 
the GSE bill, which is of course, as you know, about a new 
regulator, which I agree on. You have the housing component in 
the GSE bill, which is the $5 billion-some which now would be 
altered for a first-shot by disaster relief and then applies to 
the rest of the Nation too because there is a balance to help 
people across the U.S. before the disaster as we had planned.
    What type of impact do you think we could make if we remove 
the housing component out of that bill, the housing goals, but 
those are the components, housing goals out of that bill, and 
do a dual-track on the bill? You still go for the regulator. I 
am not saying any of that drops, but we could move the agreed-
to part on the housing goals and fire that off next week to the 
President. Do you think that could have a better impact?
    Ms. Kennedy. I think it may be the most important thing 
that this Congress could do for affordable housing for the new 
millennium. The Community Reinvestment Act provided a 
regulatory incentive to insured institutions to help meet the 
credit needs of their communities. So primary lenders, going 
back to David Rockefeller 30 years ago, figured out ways to 
lend and invest in low-and moderate-income communities. They 
started using nonprofit partners in their cities to help them 
accelerate their progress.
    Just to give you one example, Congressman Ney, I have 15 
nonprofit lenders in California, Ohio, Massachusetts, New York, 
Alabama, and Florida that have originated over $20 billion in 
housing that is almost exclusively affordable to people under 
60 percent of area median income. This has been validated by 
the Federal Reserve of San Francisco. But by and large, they 
have not been able to sell any of their low-and moderate-income 
loans to Fannie Mae or Freddie Mac.
    So as you are focused on what we need, we need the benefits 
of a national secondary market. Some of these lenders sell 
those loans now to insurance companies, and banks often buy 
these loans, but it is private placements, one at a time. So 
the market for multifamily mortgages on affordable housing 
today is like single-family mortgage market 20 years ago. If 
you had a national secondary market, two Government-sponsored 
enterprises making a market in them, getting enough volume that 
you could link Wall Street with these loans on homes affordable 
to low-and moderate-income families, it would be phenomenal.
    Chairman Ney. The other question I have ties into a couple 
of statements I think Ms. Norris made and Mr. Beamon.
    I want to thank you for your answer on GSEs. You gave me an 
idea when you testified about something we can do that 
potentially does not kill the overall bill, and it moves 
something right to the forefront within a matter of days.
    A lot of people have not talked about furniture and items. 
We have talked about temporary housing or how we do things in 
Section 8 or emergency vouchers.
    The question I have to ask you--I will start with Ms. 
Norris. As you know, I live in Heath, Ohio, about 30 miles from 
Columbus, Ohio, to the east.
    How would be people in just our surrounding area, for 
example, if you have furniture and you have items; how do you 
collate that? How do you get what I think we could raise 
tomorrow or tonight when I go home and talk to neighbors?
    You can give money, and I fully understand that, but also 
items we have we could get up there immediately, maybe get a 
truck together and drive it up there. How do you get that 
information out?
    Ms. Norris. Again, I think it goes back to what we talked 
earlier. It is local initiatives.
    I really commend Columbus. The mayor, the commissioners 
from the county, they got this whole energy going, and they put 
everybody in one spot. That includes the agency folks.
    There is one of those organizations that is doing something 
called Adopt a Family. So they are working with the churches 
and the nonprofits in the community to say as soon as we get a 
family and we find them a place to live, you will adopt that 
family. You can help them get enrolled in school. You can help 
them get the furniture. It is taking an amazing combination of 
the funds that can come from the agency and the charity of the 
locale and make that work.
    So I think in Columbus--and maybe we need to start getting 
out those kind of best practices of places like Columbus, out 
to the people so that people do not have to reinvent it every 
single time and find out how those energies can be put 
together.
    Chairman Ney. Yes, Ms. Kennedy?
    Ms. Kennedy. Columbus is definitely the model. I heard 
about it from my members out there.
    But I think one thing for you to pursue with FEMA is 
whether or not the law still provides entitlements to people 
who have been displaced by the flood. I have seen references to 
it in the newspaper. I have even seen it on FEMA's Web site, 
and I shared that with your staff. It is exactly what I 
remembered. Everybody is entitled to up to $26,200 for various 
things.
    What apparently has not happened here is that the family 
who needs furniture has not been told by whoever has handled 
the application that they are entitled to a living allowance 
that would include basic furniture, the cribs, the beds, the 
sofa. So I think one of the things to pursue with FEMA is how 
come people do not know what their rights are when their Web 
site describes them?
    Chairman Ney. Another issue on the Web site--and I picked 
this up this morning. You have a HUD Web site, a FEMA Web site, 
et cetera. That is fine, but electronically, I am no wizard at 
this, but I am told electronically by our House administration 
staff, you can take today the FEMA Web site and you can put 
seven icons on there and it clicks you instantly into other HUD 
Web sites on everything, and you can do the reverse on the 
others because people have to click into this Web site and that 
Web site. So combining also on some pages, just the electronic 
part of it I think would be something that can be done.
    We are having a meeting today. I think there are issues; 
some of these we can bring up and again try to get them solved. 
We are placing the phone calls. I expect I would want an 
answer, again from the Administration today, do they know how 
many people are in shelters or not, or how many are there, what 
do they think, so we can get a handle on that. Those are things 
either we know or we do not know, we have a number or we do not 
have a number, and if we do not, how do we find out quickly, 
not within a 6-month commission study.
    So those are the issues again I am stressing that you are 
raising to us and you raised at the roundtable when the 
gentlelady was there; Mr. Green was there and others. Those are 
things we do need to know. I cannot stress to you how helpful 
you have been on that. I am going to also make a statement and 
turn to my colleagues who might have some questions. Again, I 
want to thank you for your work in helping people.
    You had mentioned the Ohio Valley floods. We went through 
three rounds of floods. I have been working for 24 years, and I 
have been in office on different levels, on floods. We flood. 
We had some severe ones, three in a row. All 88 counties were 
declared a disaster last year. We are still trying to pick up 
the pieces for some people a year later who have fallen between 
the cracks somehow.
    When we talk about, however, the discussions of changing 
FEMA or reinventing some things--and I am having a summit back 
home of all of our emergency management people and local 
officials--we also have to be careful that we do not change 
things that take us backwards or hinder the ability to keep it 
simple to help people. Sometimes we think it is complicated 
now, and in the past it was even worse years before, to be able 
to get direct help to people.
    So I think there is a balancing act there of taking what we 
know from this disaster and this tragedy and being able to do 
some reforms that help people, but also watch how we do them. 
There has to be cooperation in the Congress's involvement and 
the solicitation of ideas from people that work right out 
front, as you all do and your groups do in the field.
    The other thing is, I commend our communities that have 
obviously reached out. I have a lot of counties that I have had 
that were flooded, Tuscarawas, Belmont, and other counties. 
People were giving money and there have been telethons and 
support and welcoming people into the communities. But you 
know, I put myself in the situation, in a mindset of when we 
went through the floods. We had 7,000 people evacuated from 
Tuscarawas County. Those 7,000 luckily were able to go back 
after a period of time, but 7,000 out of a county of 70,000. 
That is a lot of people.
    I cannot imagine where I would just blanketly say, we have 
had this severe catastrophic event; let's say we had one in one 
of the counties, and the option I give you as the Government is 
you can move to Chicago, New York, L.A., Boise, Idaho. That is 
your option. We move everybody out there. We start to repair 
the hypothetical total disaster. Well, now a job is open, but 
your family is out in Chicago, so they can stay there and we 
are going to bring you to get a job back where you are from, 
except where do we house you?
    So we do have to seek what people want to do. I understand 
that. But there also have to be the option because if you do 
not give people the options of some modular homes at least 
somewhere in the vicinity, then you only give them one choice.
    So I applaud the communities of helping, but also by the 
same token, I want to make sure we do not get away from the 
ability to give choices so people can still be near their 
relatives and near the area where they are from. So I think 
there is a balance to that, in my opinion.
    The gentlelady?
    Ms. Waters. I would like to thank you all for being here 
today.
    I would like you to really have an appreciation for the 
fact that our members are indeed focused on this. They are 
spread out, trying to be in sometimes three or four different 
committees at the same time, but very much focused on this 
issue. Everybody is. So thank you very much for your patience.
    This business about what people are eligible for is a 
puzzle. We are meeting with FEMA today and I am going to try to 
come out of that meeting having learned how to respond to folks 
who say and ask the question, what am I eligible for? You would 
think by now that there would be thousands, millions of flyers 
everywhere in every shelter with people understanding what they 
are eligible for. I do not take kindly to some of the responses 
that we get where they say, well, tell them to go online. What 
line?
    These are people in the shelter, and not only do they not 
have access to computers, most of them, but some of them have a 
couple. I was at LSU in Baton Rouge and they had a couple of 
computers. But many of the folks have never had a computer. 
They are not computer-literate. They would not know what to do 
if you sat it down in front of them. Many of them are elderly. 
Many of them are handicapped, on and on and on.
    So in addition to those who have access to a computer or 
may have, some have one, and it is underwater now, too. I do 
not know if anybody set up any community computer centers 
nearby. I have not seen any.
    So there should be millions of flyers that are available. 
My database here of all of the shelters in Louisiana, Texas, 
Alabama, Arizona, and Georgia is a week old. I am not so sure. 
I know what has happened since this. A lot more people have 
been sent out of State because at the time that I got this, 
there were still people being plucked from rooftops and people 
who were leaving the Astrodome, et cetera.
    But there is no reason why they should not have this 
information put forth in a very simple way for everybody to 
understand and know. Social workers who want to help do not 
know. Ministers who want to help do not know. And so I am 
really going to be on FEMA today. As a matter of fact, I was 
saying to the chairman, we know that they are focused on the 
ground. A lot of what we have been told is they are not 
available because they are all in-theater or on the ground. I 
just think that we are going to have to go and get on the 
ground and stay on the ground until we understand a lot about 
the operations that are going on.
    So I have a real appreciation for your concerns, and saying 
people do not know what they are eligible for. And absolutely 
$26,000 could make a heck of a lot of difference when you are 
trying to get on your feet. So we are going to do everything 
that we can to try and force some communications, some way to 
disseminate this information, particularly not only to the 
people, but to those who help folks. We have many people who 
need to have, ministers or social workers or others who have 
the information to be able to help them, because even when they 
get it, they do not know what to do with it.
    So as an old social worker, I feel a real sense of 
responsibility to get on this and make it work.
    Thank you very much.
    Chairman Ney. Thank you.
    The distinguished gentleman from Texas?
    Mr. Green. Thank you, Mr. Chairman, and thank you, ranking 
member, for allowing us to have these hearings. I think they 
are important.
    I do thank you, the members of the panel. You have been 
outstanding, and I appreciate what you are trying to do to help 
us.
    It appears to me that we are going to be faced with some 
philosophical introspection, that we are going to have to look 
deeply within.
    I reference this because, as I listened to you talk about 
persons who are survivors, who are eligible for vouchers, I 
also know that we have people who are similarly situated who 
are not survivors, who are starting to ask, "Where is my help? 
I, too, am in need." And many of them are of the opinion that 
it is no fault of their own that they are in need. Persons who 
are adopting families, we have families that were in need of 
help before this dastardly hurricane came along. They are 
asking, "Where is my help?"
    What I am saying to you is, I think that we are going to 
have to look at the whole question of poverty in this country 
and how we address it because we are finding now that there is 
a way if we have the will, and we are demonstrating that we 
have the will as it relates to this disaster.
    I support the methodology that is being proposed. I think 
these are good measures. The whole notion of relaxing the rules 
so that you can get people into units without having to comply 
with some rule that says you cannot have your boyfriend in with 
you, if I understand some of these rules.
    But in the final analysis, we have to acknowledge that we 
have a lot of poverty in this country and that we really have 
not designed a systematic approach to dealing with the poverty 
in this country.
    There is a rule that I have governed my life by, my 
political life by. The rule is, it is not enough for things to 
be right. They must also look right. It may be right for us to 
give the vouchers to the victims of the hurricane and exclude 
others who need them, but it does not look right. There is a 
whole list, a long list of things that we are doing that may be 
right, but they do not look right. I think that at some point, 
that catches up with you because the world is watching us.
    I will give you a sterling example. We had persons who 
arrived in Houston by way of bus from the Superdome. We had 
some other persons who came from that same area, but they 
managed to get to Houston by car or various means. They could 
not get into the Astrodome. They came from the same location, 
but they came by different means of transportation. So we had 
to look inward and say, is this right for them to be excluded 
simply because they did not get here on the bus? We did work 
out a means, thanks to the mayor and the county judge and 
others who are involved. We were able to resolve the problem.
    I think that this is a great opportunity now for us to look 
beyond Katrina and look at America and decide how we can go 
forward and deal with the whole question of poverty in America. 
I think that is the greater question that is really before us. 
I think that if we govern ourselves by the notion that it is 
not enough for things to be right, they must also look right, I 
think we will make some far-reaching decisions that will 
benefit all of the people who are less fortunate than some of 
us in this room.
    Now, a question. This question goes to all of you in a very 
general sense.
    First, a comment. There is the notion that we need to have 
the survivors located as close to their homes as possible. This 
would give them an opportunity to have work in the area, that 
the money that they will get from the Government can go back 
into the economy in the State, the $26,000 that goes back into 
that State's economy. There are all sorts of good reasons why 
we should do this.
    How would you develop a program so that we can have them in 
the States where they are coming from? That is, those who want 
to return. Obviously, if people do not want to return, we have 
to give them the option of staying where they want. In this 
country, we have freedom of movement. But those who want to 
return, what is the best way to design a program to get this 
done?
    In Texas, we have approximately 250,000 people and many of 
them are now leaving Texas. I have heard stories about people 
going as far away as Utah and some other places, but they are 
getting removed. They are getting relocated. I am not sure that 
all of them will traverse that distance back to their States.
    So how can we design a system to have them located in their 
States so that they can help the economy of the States that 
they are from and continue to be productive citizens in those 
States? Yes, ma'am.
    Ms. Kennedy. I have worked five major disasters in four 
States. I have family that was affected in another. Let me be 
crass and say, show them the money and the market will come.
    In other words, by now in a "normal" horrendous disaster, 
families would know that they were entitled to temporary 
housing allowances. When that word goes out that there are 
vouchers in Alabama or temporary housing allowances in Texas, 
the private market responds. As Mr. Brodsky pointed out, there 
is a HUD housing Web site, housing.net, where landlords can 
list their available units for people to find out about.
    But the key thing, I think, is to think of this disaster 
relief as an entitlement. A human being gets to decide, because 
they are entitled to disaster relief assistance, if they want 
to stay in the area or if they want to try someplace else. It 
is not uncommon for them to want to stay in the area. That is 
when having the word of the money get out through pastors as 
well as realtors and landlords is really important.
    People suddenly start to think, you know, I could rent that 
basement apartment or that garage apartment. Those make 
perfectly okay temporary housing situations for some families. 
My family in 1997 spent 4 months in a tourist cabin in the 
woods of Minnesota, but it was fine because it was within 
driving distance of their house that they needed to repair. 
Other people will take the money and say, I really want to 
relocate to my aunt in Detroit. They may decide to stay there 
or they may decide at the end of the temporary housing 
assistance to return home.
    So the prospect of having some mobile homes, I do not agree 
with RVs, but manufactured housing that is temporary in the 
smallest possible sites is also important. What you are looking 
for is clusters of no more than 20 mobile homes together. 
Sometimes extended families will relocate. All of which is 
designed to ease the transition to the next step, which is 
either rebuilding a house or finding a home.
    Mr. Green. So you would have the vouchers go to the 
evacuees?
    Ms. Kennedy. As they have in other disasters.
    Mr. Green. Okay.
    Ms. Kennedy. Yes.
    Mr. Green. I mention that specifically because I have had a 
number of community-based organizations to visit with me. They 
have been very helpful, and they are depleting their resources, 
and they are asking, how can we replenish our resources so that 
we can continue to help.
    Now when I posed this question to a representative from 
FEMA, I was told that FEMA does not make direct payments to 
individuals who are not evacuees, that it does not do this.
    Ms. Kennedy. Well, that is right, but evacuees could be 
reimbursed. I think what we are up against now is the 
threshold. Evacuees need to understand what they are entitled 
to. The agencies that have been helping them and have been 
carrying the burden need to now relieve themselves of that 
burden so that the Federal Government can step up.
    Mr. Green. If I may, then I will come right to you. My 
concern is these agencies that have carried the burden; we want 
to leave them with a good feeling about what they have done. 
Right now, many of them are not feeling real good about the 
process and the prospect of having depleted their resources. I 
am not sure what their response will be the next time. I think 
that we want to make sure that they have a good experience with 
this to the extent that we can, to continue.
    When that representative from FEMA indicated that while, 
and I found this very interesting, while FEMA cannot pay the 
individual, FEMA can pay the State and the State can pay 
individuals. So there is a roundabout way of getting this done. 
While I am interested in the roundabout way, I am also 
interested in formalizing that process to the extent that we 
can so that the State.
    And, Mr. Chairman, if I might, I just wanted to share this 
with you. Having talked to FEMA about reimbursing community-
based organizations or faith-based organizations and found out 
that they cannot make direct payments to these organizations, 
but the State can and FEMA can reimburse the State.
    So right now we are trying to work on some means of 
formalizing this informal process because we have a lot of 
faith-based institutions that really stepped up to the plate. 
It would be great if we could somehow help them to replenish 
some of their resources. They may not get all of their 
resources and assets restored, but it would be great if we 
could get some of those replenished.
    So I would like to work with whomever you think 
appropriate. I have talked to my ranking member about it as 
well. If that is something we can do, I think it would be 
great.
    Yes, ma'am?
    Ms. Norris. I guess I would just like to confirm what you 
are suggesting. That is, I think that the benefits that are 
coming from FEMA, as has already been suggested, nobody really 
quite knows how it is working. It really is not easy. There is 
no "how to." There is a Web site and there is a way for people 
individually to get a certification, i.e., they get a number. 
What we cannot find out from anybody, including the FEMA rep 
that was at one of the shelters, is what did that entitle this 
person to. The answer was, it depends; we will have to get back 
to them.
    Now how is anybody supposed to make any kind of decision or 
any of the agencies supposed to help make a decision if nobody 
knows what this person is going to be entitled to? The fact 
that they cannot make any kind of decision and get these folks 
awareness of what their benefits are either through the 
agencies or through direct conversation with these folks, is 
really I guess the question we all need to be asking.
    How is it that FEMA cannot seem to figure out what people 
are entitled to? How can we not get that communicated out to 
the people who are most devastated by the situation? That is 
what we are seeing on the ground.
    Mr. Green. Would anyone else like to respond to the 
question of how you would design the system so that people can 
get back to their States, their cities, their locales?
    Mr. Beamon. I would like to respond. At some point, we need 
to involve the Department of Labor with some of their job 
training programs and the network of job training programs that 
get funding from them. In this case, the training should go 
toward displacees, people that have been displaced because of 
the hurricane. They have a network that several organizations 
work in several States. I just think this would be one good 
start. I would like to add this to my list of recommendations.
    Mr. Green. All right. Now, if I can have one more--thank 
you, Mr. Chairman--one more thing.
    The people who will be working, they obviously will be paid 
some amount. I will tell you, I almost had tears to well in my 
eyes when I read about how the normal amount that would be paid 
may be reduced. We are catching people when they are most 
vulnerable, when they need help the most, and we are talking 
about paying them less than we are paying people in other areas 
who might be doing the very same work. That is very 
disconcerting. It really is.
    I do not know how you would propose that this be addressed, 
and maybe I am addressing it to the wrong panel. I am just not 
sure. It causes a lot of heartache to see this kind of thing 
occurring to people who are most vulnerable, that they are 
going to be paid less.
    Have any of you encountered this before, where the wage-
scale was dropped in an area after this kind of devastation?
    Mr. Brodsky. Congressman, it is not really a housing 
question for me to answer, but just in general I would assume 
that once programs are characterized to rebuild, there will be 
a shortage of labor in the area that is qualified to perform, 
regardless of the number of dollars that are available to 
build, and you will not have a price-point problem for labor. 
But at the moment, nothing is being built.
    So I would characterize it more likely as a short-term 
issue if it exists, and that the only thing I could assume is 
that with so many people gone, if you are trying to bring in 
construction labor from all over the country, they will be 
bidding up the price for labor, not down.
    Mr. Green. Are you familiar with the specifics of what I am 
talking about? You are? Okay. I just wanted to make sure.
    Any other person want to respond to that? Okay.
    Mr. Chairman, I thank you. You have been very generous with 
your time.
    Chairman Ney. I have more time. I want to respond to it, 
though.
    Mr. Green. Yes, sir.
    Chairman Ney. If I can respond to your question.
    Mr. Green. Thank you.
    Chairman Ney. I am alarmed, alarmed. If Davis-Bacon, after 
we voted, has been removed, which I think would be the second 
time in the country's history.
    Mr. Green. I think it would be the third.
    Chairman Ney. Third. You are right. It is three, the third 
time in the country's history. The goal of removing it would be 
that you save money and you can use more money. I think that 
may not happen. I think removing it may at the end of the day 
people could come in there and there would be a higher price, 
instead of the $7.50 an hour or whatever it was, and it was low 
anyway down in some of the States, and it could be a higher 
price so more money would be eaten up. This is something we 
have been looking at for 3 days now because we were not 
involved in this discussion.
    Mr. Green. Yes, sir.
    Chairman Ney. I am alarmed about it. I am alarmed. Our 
office is looking into it and other members; we have been 
talking among ourselves. I think it is something that can be so 
counterproductive and the money will go up to the top of the 
food chain versus the people that need those jobs and need to 
be able to work them. So I am alarmed. I am in the same camp as 
you are on this.
    Mr. Green. Thank you, Mr. Chairman.
    If I may, friends, as a neophyte, I am not sure that I 
could have landed on a better housing committee than this one. 
Our chairman truly does care, and it is evidenced not only in 
his words, but in his deeds. I thank him for his kind comments 
and I appreciate very much your efforts to be of assistance to 
us. Thank you.
    Chairman Ney. I thank the gentleman for his kind comments.
    Anything else to bring before the committee?
    Ms. Kennedy. Just one thing. I have been disturbed by what 
I have been reading in the newspaper about this housing 
assistance command. Back to what your point was about the 
Davis-Bacon and you are not being consulted.
    You know, those of us who have done disaster relief before 
are a little uncomfortable about a defense contractor, the Red 
Cross, and FEMA, and HUD is mentioned, not just doing disaster 
relief, but actually developing policy.
    So I would just encourage you, because of your leadership 
in housing, to get into that because I get nervous when I think 
about contractors who are not familiar with housing influencing 
policy.
    Chairman Ney. Like I said, with respect to that, also 
thinking about where I live and not giving people a choice, 
that your only choice is that you are going to go to another 
State, you are going to take it if you are up against the wall.
    Now if you give some choices and people can remain locally, 
I am not saying it is perfect conditions or whatever, but that 
is a decision that has to be made pretty soon about immediate 
emergency or, first of all, emergency waivers, Congress has got 
to move within days on that, in my opinion. I do not know the 
magic number.
    But again, just to repeat what I said earlier, if you say 
to a person who has had a catastrophic event, your only option 
to keep your family safe and you is that we are going to move 
you seven States over, you are going to take it at the end of 
the day if you have no choice because you have no options. But 
if you give options, they can remain local. If you take 
everybody out of an area and they move and then the next thing 
you know it is 60 days later, and hey, you have a chance at a 
construction job down in Mississippi and New Orleans.
    Okay, that person comes back. What do they do with the 
family-- because they are now in Utah or Chicago--what do you 
do with your family? And when they go back, where are they 
going to live? So why did they move in the first place, when we 
could do temporary housing?
    If we do not move on this temporary housing situation out 
of the shelters, then there is only going to be one choice, and 
that choice is to go somewhere else. That is not giving a 
person a choice, especially people that right now are 
defenseless.
    So I think it is something that we have to move on, how we 
do it, if FEMA or HUD or whatever have to waive some rules, and 
I do not know what is the magical number. People are already 
saying, well, if you bring in the modular housing, you are 
going to create so many problems. Well, you just do not wipe 
out the option for people by saying, well, there will be 
problems if we do that. We have to give people in this 
situation some ability to have some choices, too.
    And some people, I agree with Mr. Green, they may move and 
not come back, but if you force everybody to move and you do 
not give them an option, we have done a very disservice to a 
lot of people and families and to regions and culture.
    With that, with no objections, the hearing record will 
remain open for 30 days for additional questions to be asked or 
items to be submitted in the record.
    I thank the gentleman and the other members of the 
committee today.
    I thank you, especially for your work, for helping people, 
and your time here in the House.
    Thank you.
    [Whereupon, at 1:45 p.m., the subcommittee was adjourned.]


                            A P P E N D I X

                           September 15, 2005


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