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


 
                    HOUSING OPTIONS IN THE AFTERMATH


                     OF HURRICANES KATRINA AND RITA

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

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
                   HOUSING AND COMMUNITY OPPORTUNITY

                                 OF THE

                    COMMITTEE ON FINANCIAL SERVICES

                     U.S. HOUSE OF REPRESENTATIVES

                       ONE HUNDRED NINTH CONGRESS

                             SECOND SESSION

                               __________

                            JANUARY 13, 2006

                               __________

       Printed for the use of the Committee on Financial Services

                           Serial No. 109-69





                                 _____

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

                 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
WALTER B. JONES, Jr., North          BARBARA LEE, California
    Carolina                         MICHAEL E. CAPUANO, Massachusetts
CHRISTOPHER SHAYS, Connecticut       BERNARD SANDERS, Vermont
PATRICK J. TIBERI, Ohio              STEPHEN F. LYNCH, Massachusetts
GINNY BROWN-WAITE, Florida           BRAD MILLER, North Carolina
KATHERINE HARRIS, Florida            DAVID SCOTT, Georgia
RICK RENZI, Arizona                  ARTUR DAVIS, Alabama
STEVAN, PEARCE, New Mexico           EMANUEL CLEAVER, Missouri
RANDY NEUGEBAUER, Texas              AL GREEN, Texas
MICHAEL G. FITZPATRICK,              BARNEY FRANK, Massachusetts
    Pennsylvania
GEOFF DAVIS, Kentucky
JOHN CAMPBELL, California
MICHAEL G. OXLEY, Ohio
                            C O N T E N T S

                              ----------                              
                                                                   Page
Hearing held on:
    January 13, 2006.............................................     1
Appendix:
    January 13, 2006.............................................    91

                               WITNESSES
                        Friday, January 13, 2006

Jefferson, Hon. William J., U.S. Representative from the State of 
  Louisiana......................................................    13
Boyer, Elise, Resident (currently residing in hotel).............    52
Gable, Dr. Willie, Jr., Executive Vice Chairman, National Baptist 
  Convention, USA, Inc...........................................    73
Gray, Darrius, President, Greater New Orleans Hotel & Lodging 
  Association....................................................    59
Kelly, James R., Chief Executive Officer, Catholic Charities 
  Archdiocese of New Orleans.....................................    66
Kegel, Martha J., Executive Director, UNITY for the Homeless.....    67
Lewis, Muriel, National Association of Katrina Evacuees..........    63
Mercadel, Kevin, Neighborhood Recovery Specialist, Preservation 
  Resource Center of New Orleans.................................    60
Nagin, Hon. C. Ray, Mayor, City of New Orleans...................    16
Noel, Randy, President, Reve, Inc................................    74
Perry, James, Executive Director, Greater New Orleans Fair 
  Housing Action Center..........................................    69
Schedler, Larry G., President, Larry G. Schedler & Associates, 
  Metairie, LA, testifying on behalf of the National Multi 
  Housing Council/National Apartment Association.................    64
Stewart, Pauline, Resident (currently residing in hotel).........    51
St. Julien, Mtumishi, Executive Director, Finance Authority of 
  New Orleans....................................................    34
Wells, Scott, Federal Coordinating Officer for DR-1603-LA, 
  Federal Emergency Management Agency, Department of Homeland 
  Security.......................................................    38
Williams, Charles, H., Deputy Assistant Secretary, Multifamily 
  Housing, Department of Housing and Urban Development...........    36

                                APPENDIX

Prepared statements:
    Ney, Hon. Robert W...........................................    92
    Jefferson, Hon. William J....................................    93
    Lee, Hon. Sheila Jackson.....................................   100
    Gable, Dr. Willie, Jr........................................   108
    Gray, Darrius................................................   119
    Kelly, James R...............................................   122
    Kegel, Martha J..............................................   125
    Lewis, Muriel................................................   129
    Mercadel, Kevin..............................................   131
    Nagin, Hon. C. Ray...........................................   140
    Noel, Randy..................................................   143
    Perry, James.................................................   153
    Schedler, Larry G............................................   164
    Stewart, Pauline.............................................   169
    St. Julien, Mtumishi.........................................   172
    Wells, Scott.................................................   181

              Additional Material Submitted for the Record

Lee, Hon. Barbara:
    Louisiana Commission on HIV/AIDS and Hepatitis C, "A Call to 
      Action"....................................................   191
    National Policy and Advocacy Council on Homelessness, 
      prepared statement.........................................   192
Melancon, Hon. Charlie:
    Email regarding production of trailers.......................   197
Mercadel, Kevin:
    "N.Y. Benefit Supports Restoration," article, New Orleans 
      Times-Picayune, January 13, 2006...........................   198
    PRC Renovations, Faubourg Marengo Historic Neighborhood 
      Initiative, 600 Block of General Taylor Street.............   200
Perry, James:
    National Fair Housing Alliance, Report on Housing 
      Discrimination Against Hurricane Katrina Survivors, 
      December 20, 2005..........................................   201


                    HOUSING OPTIONS IN THE AFTERMATH



                     OF HURRICANES KATRINA AND RITA

                              ----------                              


                        Friday, January 13, 2006

             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 2:10 p.m., in 
the Board Room, Port of New Orleans Administration Building, 
1350 Port of New Orleans Place, New Orleans, Louisiana, Hon. 
Bob Ney [Chairman of the subcommittee] presiding.
    Present: Representatives Ney, Waters, Lee, Green, Cleaver, 
Watson, Melancon and Taylor.
    Chairman Ney. The Housing Subcommittee meets this afternoon 
to continue its discussion of the Federal Government's response 
to the emergency housing needs of residents affected by 
Hurricanes Katrina and Rita.
    This is the first field hearing held in New Orleans since 
Hurricanes Katrina and Rita struck the Gulf shores late last 
summer. And we will also be going tomorrow to Gulfport, 
Mississippi, to also to have hearings down there.
    I am going to limit my opening statements. The members here 
of course are free to make opening statements. I would explain, 
we are under the rules of the House and this is an official 
House hearing and this is the Subcommittee on Housing and 
Community Opportunity. We have a 5 minute rule, we call it, 
where a witness will speak for 5 minutes. Members then will 
have 5 minutes to ask questions and respond. We will try to 
hold to the rule, but I do not want to cut you all off with a 
bang of a gavel. So we will try to have some leeway obviously 
because this is an important topic today.
    Mike Oxley from Ohio chairs the full Committee on Financial 
Services. And the ranking member is Barney Frank of 
Massachusetts and I chair the subcommittee. And my name is Bob 
Ney from Ohio and Maxine Waters is our ranking member from 
California. And of course we have other members who are going 
to introduce themselves today.
    Again, I am going to limit it because I do want to get to 
our panel and I think they have important things that we will 
want to hear. I want to thank the mayor and also Congressman 
Jefferson for hosting us in this historic city. This is not my 
first visit here. Also, I would like to thank Chairman Richard 
Baker and all the Members of the Louisiana and Mississippi 
delegations who took the time also and have been working on 
this issue. And of course I want to thank our subcommittee 
ranking member, Maxine Waters, who has dedicated so much time 
to this issue and I think was here on the ground pretty quick 
after this happened. And I realize too our members have 
traveled from the west coast and sometimes that is not easy to 
be able to do that. I really appreciate them being here.
    We have been at the forefront of this in Washington, D.C., 
since it began. We have had a committee that we formed for 
disaster recovery. Members have been meeting constantly with 
FEMA, with HUD, with groups of people that call us from across 
the country, all trying to see how we can help in this 
situation. So we have been at the forefront of it and we have 
had three hearings, four briefings, and approximately 80 
witnesses participating.
    In addition, the committee has shepherded needed relief 
legislation to the House floor in the recent months following 
this disaster that will affect not only families in the 
immediate hurricane-ravaged areas but those families forced to 
suffer the aftermath due to flooding.
    Now clearly there are many challenges ahead. Some are local 
decisions; some are local, State; some are local, State, and 
Federal. But they all involve human beings who have been in 
such trauma in their lives as a result of what has happened 
here.
    There are still many that are without, of course, permanent 
housing, jobs, and infrastructure. And this committee focuses 
on the housing aspect. That is one reason we are here. And 
also, about people that are living in hotels or on the cruise 
ships and what is going to happen to them, what is the time 
frame. These are the issues we have dealt with in Washington, 
D.C. So I look forward to working with our chairman, Mike 
Oxley, Congressman Richard Baker, Barney Frank, our ranking 
member again of the committee, and Maxine Waters, and our 
members. Also, would the staff on both sides of the aisle 
please raise your hands, all the staff.
    [Staff complies.]
    Chairman Ney. These are wonderful people and they make the 
system work. They work very, very hard, so I want to recognize 
both sides of the aisle of the staff.
    Let me just close by just saying we went today around the 
affected area. Even though we have been dealing with this issue 
in Washington, and trying to help, as everybody from any State 
should--we are one country--until you see this--it is the most 
unbelievable thing I have ever seen in my life and the shock 
and the trauma of what has happened to people. And I just, I 
would tell you the outpouring of so many of you and putting 
your hearts and soul into helping these people is something 
that shows the true spirit of the worth of the human beings 
from around the country and people right here on the ground. I 
have never seen anything like what I saw today. Our hearts go 
out to the people here and also all that you see in the rest of 
the Gulf affected areas.
    I also wanted to introduce Mr. Sidney Williams, ambassador-
I should give him his title-and also spouse of Maxine Waters. 
We are so happy to have Ambassador Williams here today. And 
also, Minister Louis Farrakhan, we are very happy to have Mr. 
Farrakhan here with us today. Thank you.
    [Applause.]
    Chairman Ney. And again I would also like to note, I would 
like unanimous consent that Congressman Melancon and 
Congressman Watson can participate in the hearings today. 
Without objection, they will be able to participate. And I will 
turn and thank again for your concern and all your dedication 
to the people that have been so affected. Our ranking member, 
Maxine Waters.
    [The prepared statement of Hon. Robert W. Ney can be found 
on page 92 in the appendix.]
    Ms. Waters. Thank you very much, Mr. Chairman.
    I would first like to thank the chairman of this committee 
for pulling together this hearing and coming to New Orleans to 
make sure we get a first hand view of the devastation that has 
taken place here. The chairman is correct; I was here in New 
Orleans about the fifth day following Katrina, where I 
witnessed much of the devastation, having spent time at the 
Louie Armstrong Airport that was being used as a staging ground 
for those who were being plucked off of roof tops and off the 
highways. And I saw something that I never thought I would see 
in America at the Louie Armstrong Airport where people were 
literally dying and did not know what was going to happen to 
them.
    Many of those people were put on airplanes and buses and 
taken to places that they had no idea where they were going at 
the time. And of course, since all of that, we have residents 
of this great city who are living in various shelters across 
this country and in the homes of relatives and friends, 
supported by churches and community groups and organizations.
    And I would just like to, number one, say to the people of 
New Orleans that I have a great appreciation for what you have 
suffered and what you have been through. And this committee, 
this chairman and the members of this committee and 
particularly those who are there today are dedicated to the 
proposition that we can do better than what we are doing now; 
that we can move this agenda faster, that we can create more 
housing, we can get people back home, that we can help to 
rebuild this city. And I believe that the chairman's vision for 
putting together this hearing today is one that will help to 
get us there.
    I want to thank HUD for the tremendous job that they did in 
providing us the tour today. It is one thing to see the 
devastation on television. But it is absolutely another thing 
to be close up and to see what happened to houses and 
businesses and to see where the breaches absolutely took place. 
It is a sight and a scene that I will never forget and I do not 
think anyone who sees it can forget it. So thank you, City of 
New Orleans, HUD, the mayor's office, all, for providing us 
with that tour that we had this morning.
    Let me just say that what we understand is that in the 
region over 110,000 private homes are destroyed. More 
specifically though, some 1.5 million people are displaced and 
208,000 housing units were destroyed and 20,000 plus Louisiana 
businesses were lost.
    We have been busy in Washington, D.C., passing legislation 
and I asked my staff to give me a review of all of the 
legislation that has been passed. And I would just like to go 
over that with you very quickly. HR 4146, the Hurricanes Rita 
and Wilma Financial Services Relief Act of 2005; HR 4133, the 
National Flood Insurance Program Enhanced Borrowing Authority 
Act of 2005; HR 3909, the Hurricane Check Cash Relief Act of 
2005; and HR 3505, the Financial Services Regulatory Relief Act 
of 2005. And then, of course, we have the National Flood 
Insurance Program and HR 4100, the Louisiana Recovery 
Corporation Act sponsor.
    In addition to that, about 62.3 billion, Mr. Chairman, I 
believe was appropriated for the recovery. And one of the 
things that we must do is to find out where that money has 
gone, how much has been spent, what is left of that 
appropriation. And what do we need to do to fight for 
additional resources.
    I do want to mention that November 3, 2005, the 42 House 
members of the Congressional Black Caucus introduced HR 4197, 
the Hurricane Katrina Recovery, Reclamation, Restoration, 
Reconstruction and Reunion Act of 2005. This bill is designed 
to provide for the comprehensive recovery of the Gulf Coast 
region and for the reunion of families devastated by Hurricane 
Katrina. HR 4197 emphasizes two critical objectives that CBC 
and many others have considered most important since Hurricane 
Katrina--the desire to see the Gulf Coast restored fully and 
the desire to see the residents of the Gulf Coast reunited with 
their family.
    Title Four of the bill entitled Housing and Community 
Rebuilding Provisions, a section which I helped to craft along 
with Representative Barbara Lee, using the tools that were 
available to me as ranking member of this subcommittee, 
authorizes the additional Federal funds for the Hurricane 
Katrina disaster area for the following purposes, in the 
following amounts. Let me explain, in addition to the work that 
the chairman was doing and the other bills that you heard me 
allude to, the Congressional Black Caucus thought it was very 
important for us to structure legislation and to put into that 
legislation everything that we thought was needed. There are 
many who will look at that legislation and say, "Oh my God, 
that costs a fortune, that is much too comprehensive, it is 
much too costly." But we thought it was our responsibility to 
organize what essentially is a Rolls Royce piece of 
legislation, to say this is what the people of the Gulf Coast 
region deserve.
    We negotiated with Chairman Ney here and others, along with 
Mr. Baker, who I think will be here a little bit later today 
who had also proposed some legislation. And we were able to get 
the agreement of Chairman Ney and Mr. Baker to incorporate in 
the Baker Bill some of our concerns in addition to having our 
own legislation.
    This portion that I am going to cite to you is about 
housing because this is the Subcommittee on Housing. And we 
serve on this committee as one of the subcommittees of the 
Financial Services Committee. And we wanted to pay special 
attention to the housing needs and that is one of the reasons I 
came to New Orleans very early, because I knew that the 
displacement was going to be awesome and that we were going to 
have to talk about not only how to house people in the 
emergency-that is, with the shelters-but then the transitional 
housing and all of the trailers you have heard so much about. 
And then beyond that, what do we do for permanent housing and 
how do we deal with the existing resources that we have in 
Government, the CDBG and housing monies and Section 8 housing 
vouchers and all of that? And what do we need to put on top of 
that with new appropriations? So we put together the Public 
Housing Capital Funds for $100 million, Hope 6 Community 
Revitalization for 100 million. We increased the home funding 
by $1 billion. The Community Development Block Grant, CDBG, 
which we think is so important, and the chairman insisted on, 
we put another one billion dollars into that legislation.
    In the CDBG, Section 1089, loan guarantee funds, we kicked 
up $10 million; the Youth Bill Program, $200 million; HUD 
Demonstration Act Funds, 4.5 million; funding for 300,000 
additional tenant-based renting assistance Section 8 vouchers, 
$10 million for fair housing enforcement and $10 million that 
Barbara Lee insisted on for housing counseling for families in 
temporary shelters.
    Now I will not go into much more of this, except to say 
this was our Rolls Royce budget that is being advanced by the 
Congressional Black Caucus. As we look at what has been done, 
what has been spent, how much has not been spent, we can 
further decide how to be advocates for these additional 
resources, even given the budget deficit that we are confronted 
with in Washington, D.C.
    In closing, let me just say this; I believe that more 
attention by the Federal Government must be given to the entire 
Gulf Coast region. That despite the fact that we have had any 
number Members of Congress, both from the Senate side and the 
House side, kind ride through and ride over, this is really the 
first official hearing that has been held, thanks to 
Congressman Ney, thanks to the Congressional Black Caucus, 
thanks to Bill Jefferson, and to the other representatives of 
this area. And I do believe that not only should we be on the 
ground today, but that we should be on the ground giving 
oversight in the best way that we possibly can to the 
implementation of the funds that have been allocated to make 
sure we can move this agenda. It is a huge agenda and a lot 
that has to be done.
    I am not going to go into everything that I am happy with. 
But we all know that--and we want to find out here today about 
why more trailers have not been put on the ground. We have some 
confusion about whether or not the authorization has been given 
to put these trailers on the ground, whether or not they are 
being manufactured fast enough and whether or not FEMA is doing 
its job to get the trailers here. And whether or not the local 
government is doing its job to do the authorization and the 
placement and the infrastructure that is needed in order to put 
these trailers down until we can get permanent housing and move 
on that agenda.
    We are absolutely focused on the fact that people are in 
hotels and these dates are being given. Before we left 
Washington, D.C., the Congressional Black Caucus met with the 
Acting Director of FEMA. That is when the date was first given 
of December. And we said oh, no, we do not intend to see 
anybody put out of hotels and in the street in December. The 
date was moved to February and now I understand it has moved to 
March. But we really do not care what date they give; we do not 
intend to see anybody put out on the street at any time until 
we need to work out how we are going to move people from 
temporary living to transitional living to permanent housing.
    [Applause.]
    Ms. Waters. Again, we have a lot of questions about 
contracts--who got the contracts, whether or not they were no 
bid, whether on not they have rebid, who is getting 
opportunities to be involved in the procurement and the 
contracting. And we may not be able to get into all of that 
today.
    But again, Mr. Chairman, I thank you for starting this up 
close oversight that we must do. And with that, I know that I 
have talked over my time and I have no time to yield back. But 
Mr. Chairman, I will pretend like I am yielding back time so 
that you can give it to someone else.
    Thank you very much.
    Chairman Ney. We will note that yield back of the time.
    Ms. Waters. Okay.
    Chairman Ney. I do have, without objection, statements that 
will be entered into the record. American Hotel and Lodging 
Association, Rural Housing Service and a statement by 
Congresswoman Sheila Jackson-Lee. And I would also note--
although I would like to applaud personally for many of the 
things the ranking member said--in the House hearings we do not 
usually express either happiness or sadness or booing or 
applauding. It is okay that you applauded. I just thought I 
would tell you the protocol of the day.
    So I move on to the gentlelady from California, Ms. Lee.
    Ms. Lee. Thank you very much. I want to also thank you, 
Chairman Ney, for your leadership and our ranking member, 
Waters, for her vigilance, leadership and really for both of 
you in terms of your leadership to make sure that the response 
from our committee and the Congress is a bipartisan response, 
and that it is a response that makes sense, that is inclusive 
of New Orleans in terms of the appropriate response that the 
Congress must engage in.
    Also, let me thank the HUD officials who provided this 
visit today, this unbelievable visit of the devastation that 
has taken place. To the City of New Orleans, the State of 
Louisiana, to Congressman Baker, to Congressman Jefferson, to 
the mayor, let me say to you, the people of New Orleans, I want 
to just commend you first of all for your indomitable spirit 
and your resilience and for your determination, and I mean, 
your real determination to rebuild this great city. And that is 
what this is about. And that is what I think the Congress must 
make sure happens in terms of our support for those efforts.
    Mr. Chairman, ranking member, we all know that basically 
people want to come home. They want the electricity restored; 
they want their trash picked up, their roofs repaired, the mold 
in their homes removed, food on their tables and a way to earn 
a living. Also, the people of the Katrina region, the people of 
New Orleans, deserve to benefit from the reconstruction jobs 
that are taking place and they must be close to home to benefit 
from those jobs.
    There are hundreds of thousands of people who want to 
return home, but either fear that their home no longer exists 
or will be demolished. We have got to ensure that that does not 
happen.
    Since day one, of course, many of us have been concerned 
about the issues of eminent domain and the fact that there are 
those who could profit or would profit or try to profit off of 
this tragedy. And we are determined, from a Federal level, from 
the Congressional level, to not let that happen. So let me say 
I am convinced that our legislative efforts must be about 
helping to rebuild and restore homes and communities, but with 
equitable development strategies in the rebuilding of this 
great city.
    Today, I hope to hear from FEMA and HUD in terms of some of 
the questions that were quite frankly left unanswered in 
Washington, D.C., during our hearings. I want to find out how 
FEMA and HUD are working together for this immediate temporary 
housing and how they are working to make the transition back 
into more permanent housing as easy as possible.
    I also want to know, and this again may not be directly 
related to housing, but we have to have a coordinated effort 
with FEMA and HUD as it relates to the needs of those people 
living with HIV and AIDS and what steps are being taken to 
ensure that there is a continuity of care with these 
individuals, especially as it relates to their housing needs.
    Also let me just say, Mr. Chairman, and to our Ranking 
Member and the Committee, that I had the privilege quite 
frankly to visit Houston. It was an awesome experience to visit 
those displaced by Katrina right after the devastation of this 
hurricane. And the trauma that exists, as you well know, 
warrants some attention in terms of mental health needs, in 
terms of counseling, in terms of support services as we look at 
housing needs. And so, I see our housing strategies as being 
inclusive or at least requiring an inclusive approach to make 
sure that those who need the mental health services and the 
HIV/AIDS services receive those types of services as we help 
them return home.
    Finally, let me just say one of the issues that I have been 
very concerned with, with Congresswoman Waters and others on 
the committee, is the issue of the homeless. What is happening 
to those individuals who were homeless prior to Katrina. Where 
are they? How are they being integrated into the overall 
recovery efforts of this great city? I would like to include, 
Mr. Chairman, and let me just ask unanimous consent to include 
into the record, statements from the National Policy and 
Advocacy Coalition. And also, for the homeless and the Call to 
Action, I would like to have their reports entered into the 
record.
    Chairman Ney. Without objection.
    Ms. Lee. Thank you very much.
    Again, I just want to say to you that this moment should 
really galvanize us the way 9-11 did. We should be recommitted 
to helping New Orleans rebuild in terms of what the American 
dream should really be about. And we should take this moment to 
address the lack of economic opportunities and the economic 
disparities that became so glaring and that the world was--that 
the world saw as a result of this human tragedy.
    Thank you again, Mr. Chairman; thank you, Ranking Member 
Waters.
    [Applause.]
    Chairman Ney. Thank the gentlelady.
    The gentleman from Texas, Mr. Green.
    Mr. Green. Thank you, Mr. Chairman. I would like to say to 
you, Mr. Chairman, I greatly appreciate your bringing these 
hearings here. Friends, this chairman has been at every one of 
our meetings that we have had on this topic. And I am honored 
to have the opportunity to serve with him.
    I want to thank the ranking member. She clearly is the 
Congress person for the people of this country.
    [Applause.]
    Mr. Green. I want to give a special thank you to her 
because she helped us to secure $7.7 million to fight 
discrimination in housing at a time when we need to fight 
discrimination in housing because it is still taking place. The 
Katrina victims are being discriminated against based upon 
color, based upon race, and Madam Chair--Madam Ranking Member, 
I thank you for helping us to get that money to fight that 
discrimination. Thank you.
    [Applause.]
    Mr. Green. I too had an opportunity to see the devastation 
that has taken place in this city. And we lost more than 
buildings, because that is what you see with the camera's eye. 
When you go inside those homes and you see the way all of the 
furniture, all of the pictures on the walls--and the chairman 
pointed out today that there was a picture of the Last Supper--
it looks as though you just walked into the twilight zone. 
Everything there, but in turmoil, and the people are gone. They 
lost their memories, their memorabilia, the little things that 
you can never ever replace with money. I just cannot tell you 
how important it was for us to have the opportunity to go 
through the homes.
    So Mr. Chairman, I want to--and Madam Ranking Member--I 
want to say this about a couple of things that I deem to be of 
paramount importance. One, we must rebuild the levee system and 
it ought to be to a category five standard.
    [Applause.]
    Mr. Green. We have been equivocating; we have caused a lot 
of consternation. It is time for us to be definitive and let 
people know that we are committed to this city and the State 
and the Gulf Coast. Business people are going to have some 
concerns as long as we have the levees built to less than a 
category five. If we really want businesses to relocate without 
hesitation or reservation or equivocation, rebuild the levees 
and let us do it to a category five standard. I hope that we 
can get that kind of commitment from our Government.
    I think, Mr. Chairman, Madam Ranking Member, that we must 
allow the people from New Orleans to elect their 
representatives.
    [Applause.]
    Mr. Green. If they live in Houston, Texas, they ought to be 
able to select their representatives. People who live in the 
United States who are from Mexico--and I do not begrudge them--
are going to elect representatives in Mexico. There is no 
reasons why we should allow politics to prevent the people who 
were born and reared and who are residents of this city from 
electing the people of their choice. Because, I submit to you 
if they do not get the opportunity to do it, we may have a 
different look when it comes to the representation in New 
Orleans. I want to see them have a chance to vote.
    [Applause.]
    Mr. Green. And finally, I was born in Charity Hospital. And 
I want you to know that I am convinced that New Orleans will 
come back. The question that I grapple with, the thing that 
keeps me up at night, is who will come back to New Orleans? 
Will people who did not own property, who have a rich history 
in this city that they are proud of--will they have the 
opportunity to return? I am committed to making sure not only 
those who are well off and wealthy, but also I am committed to 
having the least, the last, and the lost return to this city as 
their home.
    I thank you, Mr. Chairman.
    [Applause.]
    Chairman Ney. I thank the gentlemen.
    The gentleman, Mr. Cleaver, from Missouri.
    Mr. Cleaver. Thank you, Mr. Chairman, not only for your 
leadership in holding this important subcommittee hearing, but 
for your steadfast support for the spending of Federal dollars 
to improve the quality of life for people during the pre- and 
post-Gulf Coast tragedy.
    And to our ranking member, Maxine Waters, thank you for 
doing what you always do, doing what needs to be done, and then 
telling it like it is. Thank you.
    To my friend over the years and colleague now, Congressman 
William Jefferson, thank you for hosting us along with the 
mayor.
    I served as the mayor of Kansas City for 8 years in the 
1990s. It is the most difficult job in America; you are on 
center stage. People in the United States Senate, they can go 
to Washington. Members of Congress, they can go. And mayors, 
they have to go to the grocery store, to the pharmacy, and that 
is where the people are.
    Like a snowflake that melts under the noonday sun, the 
attention of America is melting away from the devastation in 
the Gulf Coast region. I have said over and over again that we 
suffer from attention deficit disorder as a Nation. We are 
probably about a 12-week Nation; it is usually about 12 weeks, 
sometimes it is 12 weeks and 2 days, but the truth of the 
matter is in about 12 weeks, 2 days, and a couple of hours, we 
will forget just about anything. And so, we have moved on now 
to the Super Bowl and the Grammy's. We are now looking for 
Desperate Housewives. We are not into giving attention here. 
And so, that is why I hope those of you here can appreciate the 
Members who are here, particularly our leadership.
    I just want to say one thing and then move on to my 
colleague. The issue that we have to deal with, I am not sure I 
realized this until we went through the city today, is an issue 
of will. What is the will of the nation? It will cost a 
truckload of money to bring back the Crescent City, to bring 
back the Big Easy--a truckload of money. Almost as much money 
as the oil companies made in the last quarter.
    [Applause.]
    Mr. Green. And they had record profits and so it is going 
to take almost that much money and I think if we have the will, 
we can do pretty much what we want to do. This is the most 
powerful Nation on the planet and I do not think we ought to 
sit around as Members of Congress, nor you as citizens, to 
accept anything less than bringing this city back. We are 
unequal in terms of the economy and in terms of our industrial 
capacity. And if we are not able to turn around one city, 
friends, we are sending a statement. We are talking about how 
we make ourselves look bad by criticizing the Government, but 
we are making a horrible statement that the world will be able 
to see and hear, that we will not take care of our own. Our 
attention is gone and maybe this hearing will bring our 
attention back. The whole world is looking at America and 
America is looking at TV.
    [Applause.]
    Mr. Green. Thank you, Mr. Chairman.
    Chairman Ney. I thank the gentleman.
    The gentlelady from California, Ms. Watson.
    Ms. Watson. I am not going to take much time because I am a 
visiting Member who is committed to seeing that the birthplace 
of her grandmother, who was in a convent, the Order of the Holy 
Family for 13 years, is restored.
    I want to specifically thank Mayor Nagin for coming to Los 
Angeles. But for your leadership and I think your show of 
compassion and passion alerted this country to the challenge 
that we have.
    I want to thank Bill Jefferson, probably one of the 
strongest and most profound Members of Congress, who suffered 
greatly, we were in your district. It brought tears to our 
eyes; it broke our hearts. Thank you for coming today.
    But more so, Chairman Ney, for agreeing--and we were 
talking along the way and I truly feel that he sincerely feels 
your pain. And of course, there is Maxine Waters. It has all 
been said; she is the spokesperson for all of us, the 
underprivileged in this country and we appreciate that.
    But most of all, for all of you who have come and Minister 
Farrakhan for saying that you came to listen and to learn. 
Thank you for taking the time to hear the plight.
    And we have this panel and we were invited along, so we 
could hear from you in your own words as to what your needs 
definitely are. And Chairman Ney, I think it ought to be 
mandatory for every member of every fiscal committee to come 
down here and view first hand the devastation on the Gulf Coast 
and to start focusing, as has been said, on the challenge that 
faces America now that the covers have been pulled off of 
poverty. And it just happens to be that poverty looks like us.
    Thank you, Mr. Chairman and ranking member.
    Chairman Ney. I thank the gentlelady.
    And welcome to the committee, Congressman Melancon, who of 
course is from here in Louisiana.
    Mr. Melancon. Thank you, chairman. I appreciate, as all the 
other Members, you taking the time and I appreciate all the 
members of the committee that has taken the time to come from 
other States to view New Orleans and the region. This is the 
region and New Orleans is the hub.
    Mr. Chairman, there have been requests and attempts by 
Louisiana delegation for a number of years to get shares of 
outer continental shelf revenues from royalties offshore, as 
the inland States do on Federal land.
    The people that you see here are not looking for a helping 
hand. They just want--I mean not looking for a hand out, they 
are looking for a helping hand. They do not want to go begging. 
If we had a share of what is rightfully Louisiana's for the 
energy that we produce for this country and have produced for 
all these years, we would not have to be asking every day and 
begging every day for monies to help folks in New Orleans, St. 
Bernard, Plaquemines, and Mississippi and Alabama and now Texas 
and for that matter, Florida. But if we had that revenue, 
Louisiana could bond itself for the most part out of the 
situation we are in. That is a long time request in terms of 
achieving, getting this city, this region back on its feet and 
as productive as it was once for the country.
    I found out during one of the bills that were on the floor 
for debate, as I discussed monies with some of the other 
Members for Louisiana because of the disaster, the other 
thing--and this is the other point, and I made these to the 
President yesterday and asked him to get involved. If in fact 
the Congress will pass a WRDA bill, which is the Water Resource 
Development Act, which it has not done in 6 years. It is not 
the House's problem; it is the Senate's problem. But if in fact 
all Members of Congress would get involved, we could start with 
that offshore royalty money and with the WRDA bill which would 
give us authorizations we do not presently have, build the 
levees that we need to a category five, do the coastal 
restoration that is needed to protect those levees, and rebuild 
this city and this region to its once glorious presence that it 
did have.
    Those two items, if accomplished, would keep these people 
and people like Bill Jefferson and Gene Taylor and I from 
having to come and grovel and beg, because sometimes that is 
what it feels like.
    I thank you again, Mr. Chairman, Ranking Member Waters; you 
have taken the time and we in Louisiana and this region really 
do appreciate it. I understand that the Katrina Committee will 
be coming here hopefully in the next week and as expressed by 
Congressman Watson, I would like to be able to put every Member 
of Congress on the ground in this region. There has been 
discussions about the bus tours and I have mixed emotions, but 
I truly believe that if every person from this country, for 
that matter from other countries who have reached out to help 
us would come here see the devastation, understand the 
devastation, and speak to their Members of Congress, our job 
would be a whole lot easier.
    So I thank you again for being with us in New Orleans and 
taking the time out of what I know is all of your busy 
schedules.
    Chairman Ney. Thank you.
    Congressman Taylor, who also will be with us tomorrow in 
his home State of Mississippi. Thank you.
    Mr. Taylor. Thank you, Chairman Ney. I want to thank all of 
my colleagues, many of whom came from clear across the country 
to be here. I hope that you will stick around for tomorrow. 
What you will discover is the flood hit New Orleans, the 
hurricane hit Mississippi. And whether it was the flood waters 
or a hurricane that destroyed your house, at the end of the 
day, losing your house is losing your house.
    I would hope for a couple of things that you come away with 
from this--this was an equal opportunity storm, particularly in 
the case of Mississippi. The richest guy in town and the 
poorest guy in town both lost their house. You will see the 
shameful job the insurance industry has done of fulfilling its 
obligations.
    [Applause.]
    [Lights blink.]
    Mr. Taylor. And you will also see how powerful those folks 
are.
    [Laughter.]
    Mr. Taylor. But, you know, for decades collecting premiums 
and then when it comes time, finding every excuse not to pay on 
those claims.
    You will see that FEMA, although it has done a formidable 
job, still 120 days after the storm in the case of south 
Mississippi, there are 5000 families waiting on a FEMA trailer. 
Good news is that 30,000 families have gotten those trailers. 
But still you would think that the greatest Nation on earth 
could do better than that. The trailers really were not 
designed, since this is housing and these are weekend trailers 
that people will be living in for 18 months. And one of the 
things that we need to be changing as a Nation is that they 
ought to be all electric. The heat is propane tanks; for a 
healthy guy like Charlie, no big deal to change them out every 
3 days. But if you happen to be a senior citizen, you happen to 
be disabled, that becomes a major obstacle and we need to 
change that. Either the Administration needs to change that or 
we need to change that.
    But you are absolutely going to be taken aback even further 
tomorrow at the level of devastation in south Mississippi. We 
still cannot get a count, but it is a safe guess that somewhere 
between 40,000 and 50,00 homes are gone. And that in my home 
county, two-thirds of the people have either lost their home 
entirely or it is uninhabitable.
    So, again, we are glad that you are here. We want as many 
of our colleagues as possible. I do, on behalf of the people of 
Mississippi, want to thank you for what has already been done. 
And I think all of us would fail if we did not mention that to 
date something in the neighborhood of $80 billion has been 
appropriated. But there is still a heck of a lot of work that 
needs to be done. And we cannot have enough of our colleagues 
come down here and see the devastation as we ask you for 
additional help.
    So thank you for being here.
    Chairman Ney. And with that, we will move on to our panel 
and the first panel, we have our colleague of course, the 
Honorable Congressman William Jefferson. And we have the mayor 
of the City of New Orleans. Mayor, welcome also. And Mr. St. 
Julien, executive director of Finance Authority of New Orleans. 
Mr. Hank Williams, Deputy Assistant Secretary, Multi-Family 
Housing, Department of Housing and Urban Development. And Mr. 
Scott Wells, Federal Coordinating Officer, Federal Emergency 
Management Agency, FEMA, Department of Homeland Security.
    And let me just say, mayor, thank you for having us in one 
of the most wonderful cities, I have thought for years, in the 
world. And I want to give special mention to Congressman 
Jefferson. I want to thank you for helping us in arranging this 
and all the work and effort that you put into it. We will begin 
with our colleague, Congressman Jefferson.

 STATEMENT OF HONORABLE WILLIAM JEFFERSON, MEMBER OF CONGRESS 
                  FROM THE STATE OF LOUISIANA

    Mr. Jefferson. Thank you, Chairman Ney and Ranking Member 
Waters. To both of you, I implored you to come to our city, to 
our region, and you were wonderful in your response to it. And 
we thank you very much for providing the leadership that 
brought this committee here today.
    Distinguished members of the Subcommittee on Housing and 
Community Opportunity and distinguished colleagues and friends, 
I wish to welcome you to my home district, to my home city, and 
to thank you for inviting me to testify today. I want to thank 
our mayor for joining us too. He has a wonderful attendance 
record in Washington now. He is there almost as much as we are. 
We appreciate his help and his commitment.
    It is extremely important that you have convened this 
hearing today at the site of the most devastating natural 
disaster in perhaps the entire history of the United States. 
Additionally, your visit is timely as our local and State 
governments are grappling with the very issues that your 
Committee will have to respond to over the coming months and 
years.
    I also appreciate the opportunity to--I appreciate the 
commitment that you have already shown, as my colleagues have 
said, to rebuilding New Orleans and the Gulf Coast that this 
committee has consistently shown in the months since the 
monster storms Hurricanes Katrina and Rita, since these storms 
altered the lives of all of us.
    The question must not be whether New Orleans will emerge 
from these disasters, but rather how it will return. Absolutely 
critical to this recovery is the manner in which the housing 
crisis is addressed and how quickly and easily the displaced 
can find their way home again. In this spirit, I express my 
deep gratitude to this committee for having taken the time to 
tour the devastated areas of our city. Seeing it, one must 
agree, is quite different from hearing about it or reading 
about it. Every home, every neighborhood represents not just a 
tragic loss of property, but a tragic disruption in the lives 
of a vibrant people and a vibrant city. The people in the city 
are not just important to our region but to our entire country.
    As we think about how to deal with the problem of 
rebuilding the housing infrastructure and the communities in 
our city, it is important to note what truly happened here. But 
for the failure of our levee system, the flooding that has so 
devastated our housing stock, would not have occurred or would 
have been minimal. The losses that your committee bore witness 
to today in your tour would not have occurred. Because of the 
failures of our levees, more than 228,000 occupied housing 
units, representing more than 45 percent of the total housing 
stock in the metropolitan New Orleans area, sustained flood 
waters. This total includes 120,000 owner occupied units and 
108,000 units occupied by renters, representing 39 and 56 
percent of those respective stocks. By some reports, 108,000 of 
these households had over 4 feet of flood water in them for 
weeks, representing 50 percent of all New Orleans households.
    I just came back from a trip to the Netherlands with our 
two U.S. Senators, our Governor, and a host of city and parish 
leaders throughout this region. The Netherlands has a thriving 
economy and important stocks of housing in areas that are more 
than 20 feet below sea level, often more than twice as much 
below sea level as any area of our city and of our region. Of 
the $485 billion economy of the Netherlands, more than 70 
percent is derived from areas ranging from 15 to 27 feet below 
sea level. Without recovering and utilizing this area after 
suffering devastating flooding, the Netherlands would not boast 
the great culture and economic power that it does today as a 
nation of the world's second largest port and one of Europe's 
most coveted tourist destinations.
    So as we contemplate building back communities in New 
Orleans, the question is not whether we can build sustainable 
communities in every neighborhood of our city, but whether we 
will make the choice to do so. It is a matter of the vision we 
have for the City of New Orleans. Do we envision the City of 
New Orleans as again one of the major cities of our country 
with its distinct, vibrant, and historic neighborhoods fully 
restored and enhanced, as a leading port city of our country in 
tonnage. as a most interesting and creative cultural mecca of 
our Nation? If we begin with this vision rather than a short-
term view of the challenges that we face in achieving it, there 
is little doubt that the technology exists to secure this 
vision for our people and our Nation, if we but have the 
political will to make the right political choices. In a $12 
trillion economy and a $2.2 trillion annual budget, we can find 
a way to make the right choice.
    As we move forward, we must determine how to rebuild our 
housing stock and our communities scientifically, 
systematically, and democratically. We have a commitment in 
hand to build our levee system to standards not existing 
heretofore and a pledge to build a system of barrier island 
protection and wetland protection and canal protection to 
secure us against these ferocious storms. We are, therefore, 
prepared to confront this most extraordinary urban housing 
crisis that our country has ever witnessed.
    In doing so, we must move forward aggressively and 
creatively to resettle those displaced by the deluge in safe 
comfortable homes in economically integrated neighborhoods or, 
as a recent Brookings Institute report describes them, 
neighborhoods of choice and connection. Such neighborhoods may 
represent the best hope to solve many of the city's urban 
ailments. They reject the concentrated poverty, residential 
segregation and economic isolation that characterized too much 
of our city previously. They also represent a vision of a city 
rich in economically integrated neighborhoods, attractive to 
all classes of people, with schools on a path to excellence 
traversed by a notably better transportation system and paths 
to great economic opportunities.
    All of this begins with getting our people a realistic plan 
to be housed, both temporarily and in the long term. In this, 
government at every level must take decisive action. The 
displaced citizens must do their part and exert their best 
efforts to assist in this process. But I do not believe that 
where government has not asked the question of where schools 
will start up and where hospitals will be stood up, and 
infrastructure like streets and lights put in place, that 
citizen groups can be expected to make plans to rebuild 
communities all by themselves.
    In the real world where people live who have been displaced 
from their homes and who have lost their property there, a 
world where insurance companies have not paid them for their 
losses, where they have run out of money and where even getting 
a contractor or an electrical inspector is a daunting if not an 
impossible task, it does not appear reasonable to expect these 
citizens to organize themselves and plan for their community 
survival and the restoration of their homes in a few months.
    [Applause.]
    Mr. Jefferson. The committee and the Congress have already 
done a great many things to relieve the housing crisis. But it 
continues to be a crisis nonetheless. The effect of some of our 
efforts will be felt immediately--improvement to FEMA's 
temporary housing program and the 1-year deferment provided by 
HUD for FHA-secured loans, for example. Other efforts will 
yield results in the coming months and years. The extraordinary 
increase in low income housing tax credits that we just passed 
and enhancement of mortgage revenue bonds as a driver below 
market for displaced people, for example, will also be helpful.
    Next, we must continue the work that this committee has 
already begun by ensuring the passage of the Louisiana Recovery 
Corporation Act in short order. The bill introduced by 
Congressman Baker and supported by our Louisiana delegation and 
improved upon by members of this very committee brings a 
thoughtful and critical tool for the recovery of our 
homeowners. We must also provide immediate and meaningful 
mortgage relief to those displaced by the hurricane. The 
financial services industry has gone to great lengths to 
accommodate the victims of these storms, but their efforts are 
not uniform and not always helpful. I recognize, as I believe 
everyone does, that mortgage lenders are in the business to 
make money and situations such as we confront today are not 
entirely helpful to the bottom line. Moreover, mortgages are 
securitized by entities like Fannie Mae, Freddie Mac, 
Countrywide, and others and these mortgage-backed securities 
are sold to bond holders throughout the world. Accordingly, 
when the lender is confronted with the decision as to how best 
to handle an individual mortgage, he or she cannot do so in a 
vacuum because there will be significant downstream effects to 
any decision he or she makes.
    For that reason, we should consider following approaches we 
used in our student loan programs. When students graduate from 
college or graduate from school and take those first few steps 
towards independence, we have long recognized that burdening 
those wobbly initial steps with a mountain of education debt is 
not likely to improve the student's chances for success. 
Therefore, most student loan programs offer borrowers an 
automatic deferment for 1 year. That 1 year gives borrowers the 
breathing room they need to find a job, secure a home, and 
brighten their path to success.
    Same can be said for thousands who have been uprooted from 
their homes and now confront the potentially unbearable burden 
of financing two homes. Without immediate uniform relief that 
preserves the assets of the victims of the hurricanes and keeps 
the lenders whole, we will likely see a wave of bankruptcies 
and foreclosures which will have a lasting and potential 
devastating effect on the families of the Gulf Coast and its 
recovering economy.
    Mindful of that, I would ask the committee to consider an 
automatic 1 year deferment of their mortgage obligations for 
homeowners living in the core disaster area with Federal 
financing of the debt service that mortgage lenders will lose 
during that year. The precise mechanism for financing, I would 
leave for the wisdom of those of you on this panel and others 
with greater expertise in this area. However, I believe it is 
absolutely critical that homeowners receive immediate relief, 
again to give them the certainty and breathing room that they 
need to recover from the devastating effects of the hurricanes 
and return to the home for which they have worked so hard.
    In addition, we must finish the work of the GSE reform 
bill, including the creation of its trust fund to finance 
affordable housing and other housing initiatives for low-and 
moderate-income families. While that program is designed to be 
national in scope over the long term, I am grateful that the 
resources of that trust fund are to be targeted through the 
aegis of this committee to the housing crisis in the GO zone 
during the first 1 or 2 years of the program. I am hopeful that 
the Senate would join in the House's in action and move this 
important trust fund and its $700 million for our area forward.
    We must also use our community development block grant 
resources more creatively and much more broadly to support 
communities in order to rebuild this vital housing. And we must 
make the greatest use of HUD properties to rehabilitate them 
for use to repopulate our city, both on a temporary and a long 
term basis.
    At the end of the day, our objective must be that everyone 
who has been displaced through this tragic set of events called 
Hurricanes Katrina and Rita has both a realistic right and the 
realistic opportunity to return to their homes and pick up 
their lives. I believe it is the responsibility of our 
Government to ensure this chance for them. The devastation 
wrought by these storms is at once a terrible challenge out of 
which we must wring a tremendous opportunity. Our commitment 
must be that those who have suffered so much have not done so 
in vain.
    Tasked by a great and serious obligation, the Nation has 
the opportunity to help a great but shattered community 
rebuild. Not just to recover, but become more survivable, more 
sustainable, and more equitable and more prosperous all at 
once.
    I look forward to working hand in hand with you and all of 
our colleagues in Congress to achieve these daunting but fully 
obtainable goals. And again, I want to thank this committee.
    Chairman Ney. Thank the gentleman from Louisiana.
    [Applause.]
    Mayor Nagin, thank you.
    [The statement of Hon. William J. Jefferson can be found on 
page 93 in the appendix.]

STATEMENT OF HONORABLE C. RAY NAGIN, MAYOR, CITY OF NEW ORLEANS

    Mayor Nagin. Mr. Chairman, Ranking Member Congresswoman 
Maxine Waters, members of the committee, let me thank you for 
being here in New Orleans. Let me just do a time check--how 
much time do I have to spend with you today?
    Chairman Ney. We try to do 5 minutes; it will beep and not 
to make a difference but for the Member. We have some leeway 
and for the Mayor, we have some leeway if you go over.
    Mayor Nagin. Well, since you have my comments in writing, 
if you do not mind, I would like to go off script for a minute 
if I could. I will try and keep to your 5 minute limit.
    Chairman Ney. Take your time, mayor.
    Mayor Nagin. I stand before you as the mayor of the great 
City of New Orleans. I stand before you as the mayor of a city 
that was totally devastated by Hurricane Katrina. I stand 
before you as the mayor of a city where its residents were 
scattered throughout the United States and spread through 44 
different States in the United States. Most of our citizens 
received one way tickets out of New Orleans. I also stand 
before you as the mayor of the City of New Orleans that has not 
been allowed to communicate with his citizens because I cannot 
get the list of where our citizens are because supposedly there 
are Federal privacy laws that prohibit that from happening.
    I am standing here or sitting here before you while I watch 
the devastation of Katrina upfront and personal. I watched 
people suffer. I watched people in the waters after the event. 
I watched bodies float in this great city. And I also watched a 
very lethargic response to this crisis. And I watched a great 
struggle between the Federal Government and the State 
government as it related to who had final authority and who had 
the power while people were suffering and dying in our city.
    And I must tell you, I sit here very frustrated today. I am 
frustrated because my city is without revenue streams. We have 
no money coming in or very little money. I have been put in a 
position to fly back and forth between Baton Rouge and 
Washington, D.C., to beg and grovel for money. And I do not 
appreciate it because I am looking at my city and I am looking 
at the debris that still needs to be picked up. And I am 
watching this incredible game with these contractors.
    It starts out at $43 a cubic yard to pick up debris. They 
subcontract that down two or three times and when we make any 
noise about locals being able to participate in this process, 
guess what? We get a couple of them to get involved. But when 
it starts out at $43 cubic yard, it is all legal, it is 
subcontracted down to $33 to $15 and the local firm ends up at 
maybe $7 a cubic yard. And no one up the food chain does any 
work or does very little work. And yet and still, I have to 
grovel and beg for resources to stand my city up. And I am 
getting tired. I am getting tired of constantly being beat up. 
I am interacting with my citizens and they want answers. And 
they want to know what can be done. So it is not that they want 
a hand out. They just want to come home.
    And the biggest challenge we have right now besides the 
despair and the hopelessness is that I do not have housing for 
my citizens because 80 percent of this city went under water, 
80 percent--61 square miles. There has never been a city to 
experience this. If this would have happened in D.C., it would 
have covered D.C. and went over to Maryland. This is serious 
business.
    And I am telling you right now there is a request of 21,000 
individual trailer sites in my city right now. There is another 
8000 trailer sites, group sites that we kind of approved, that 
we have gone through this dance with this not-in-my-backyard 
stuff that we are going to work through as a community. And we 
still have 7000 sites that we have not been able to identify. 
So there is 36,000 families that need trailers in the City of 
New Orleans right now. And I have 1300 trailers installed for 
individual people and 551 for group sites. Now let me repeat 
those numbers; I have 36,000 people that have requested 
trailers, temporary trailers, to live in in the City of New 
Orleans. And I have less than 2000 ready to go.
    Ladies and gentlemen of this committee, it is time for 
action. It is time for us to do something special for this 
great city that contributes so much to this Nation. We have 
done just about everything that we have been asked to do. We 
begged for levees. We started out with hurricane five 
protection; we now think we might have hurricane three 
protection. But we are not sure about that because $1.4 billion 
was moved recently away from that protection. We have $11.5 
billion that have been appropriated for CDBG money.
    Ms. Waters. That is right.
    Mayor Nagin. To come down and help us with housing--it is 
going to flow through the State. And there is no formula, zero 
formula, right now that that money is going to be targeted to 
the most devastated areas in this State. So I stand here as the 
mayor of the City of New Orleans very concerned about that 
because I think politics is going to come into play with the 
spending of this money. And I think this money is going to end 
up being spread out all over the State of Louisiana. And my 
citizens are not going to get their fair share.
    [Applause.]
    Mayor Nagin. I hate to do this, but time is of the essence. 
This past holiday season, I watched during the event two of my 
police officers commit suicide. One, I spoke to the night 
before he actually pulled the trigger. Thanksgiving, I know of 
at least five suicides that happened in the City of New 
Orleans. Christmas, I am not sure what happened, but we will 
get those reports very soon.
    This is serious, serious business. And I am not trying to 
discount the efforts of this committee, but if there is some 
way, then this Nation, this Congress, this President needs to 
pull out all stops right now because the people of New Orleans 
are getting tired and they are ready to come home. And they are 
frustrated and they are peeved off. And if we do not do 
something soon, I do not know what is going to happen.
    So I implore you, I beg you, I get on my knees, I am 
puckering up.
    [Laughter.]
    Mayor Nagin. Help us. And help us today. Help the City of 
New Orleans. This city will come back with a little help. We do 
not need $250 billion. But we need our fair share. And then, we 
will spend this money appropriately. Now we may make some 
mistakes, but everybody makes mistakes. But this is a great 
city. It is the city where jazz was born. It is a city that has 
elegance and wildness at the same time, that makes us the 
unique city that we are. And we are Americans and as Americans 
we deserve to be supported in our time of need.
    Thank you, so much ladies and gentlemen.
    [Applause.]
    [The statement of Hon. C. Ray Nagin can be found on page 
140 in the appendix.]
    Chairman Ney. Let me just say a couple of things. What we 
are going to do--we normally go down the witness table. What I 
thought we would do due to the mayor's schedule and the 
Congressman's schedule, we can ask questions now, if we have 
some, and then we will go on to the testimony.
    I want to mention the GSE bill the Congressman Jefferson 
talked about. That bill, we worked on that with Congresswoman 
Maxine Waters before Katrina happened. And then after Katrina 
happened, the bill got support. Of course, the bill is about a 
few other things, but the trust fund is important because it is 
helping some of the poorest of the poor. And then, it was 
supported--Chairman Baker, Chairman Oxley, and Barney Frank the 
ranking member and staff did a lot of good work. That bill is 
pending in the Senate. If you want to do something, pick up the 
phone or write a letter if you can to the United States 
Senators, if you know any of them or if you do not know any of 
them, just write a letter. That bill is pending in the Senate. 
We hope that the Senate and the House can get that bill signed. 
I wanted to mention it. It is a very--I think very, very 
important bill.
    Another observation and then I am going to ask a question, 
the issue that we have had up in Ohio where I live, we have 
people from this city who are in Newark where my daughter goes 
to school and in Columbus, Ohio, and other areas. And do not 
get me wrong, you know, everybody is bending over backwards to 
help those individuals and help with jobs and, you know, 
clothing and different things they need. But I think--and that 
is one of the reasons we are here; some of the things you 
talked about are going to be global in the Congress with, you 
know, the dollars. And we have individuals, but we have some 
direct jurisdiction over housing. And I have been asking some 
questions about the housing issues. And again, we are willing 
to help in Ohio. We are willing to help in any State. But if 
you say to somebody, here is your choice, you can go to 
Columbus, Ohio, or you can go to Seattle or you can go to 
Philadelphia and that is your choice, then you do not have a 
choice. And so, there is a lot of people that want to be here 
and they have relatives here. So I think that just the idea 
that scattering people across the Nation is going to cure it, 
it is not going to cure it psychologically. It is not going to 
cure it for those families. It is not going to cure it here for 
this city. So I have always been worried if we do not move 
faster--and we can always do better and do more--then we are 
going to have that situation. And people are going to be lost 
for their families. If you asked me to move out of my area and 
move to New York City, I do not want to do that if something 
happened. I would do it if I had to. But so there were not a 
lot of options for people.
    What I am going to do at this point in time--I just wanted 
to make some of those comments. I have some other questions, 
but I am going to defer to our ranking member for questions.
    Ms. Water. I thank you very much, Mr. Chairman. I would 
like to say to Bill Jefferson, thank you for helping to 
organize us to be here today and for the work that you have 
been doing to try to focus this Congress on the needs of this 
area. I do appreciate that.
    And to the mayor, I thank you because you have traveled to 
Washington; you have been there; you have answered questions. 
You have done a magnificent job of making yourself available. 
And even today I know that you had to take some extraordinary 
steps in order to be here.
    Mr. Mayor, there are some things that I am determined that 
I am going to get some answers to today. And in order to do 
that I have to beg the indulgence of my chairman to allow me to 
deal with these three issues that I am kind of getting double 
talk about.
    First, the trailers, Mr. Wells, you represent FEMA here 
today, is that right?
    Mr. Wells. Yes, ma'am.
    Ms. Waters. Well, I hope you came with information because 
I do not want you to answer me that you do not know, you are 
not the right one. So I have asked my staff to get your boss on 
the line while I am talking to you because I want to get some 
answers about the trailers.
    [Applause.]
    Ms. Water. I am told by policy that you have enough 
trailers, that the manufacturing is such that you are 
manufacturing an adequate amount of trailers, that you have 
trailers on the ground that are stored that can be used here in 
New Orleans and other places in the Gulf. And I am told that 
all they need is the authority to put these trailers in place 
where the mayor and others will allow them.
    [Microphone feedback noise.]
    Ms. Waters. I do not know what is going on here.
    Chairman Ney. Could we get a little bit of help on the 
mics, if we could.
    Ms. Waters. Now I want to know from you--I want to know 
from you--give me an assessment of how many trailers are being 
manufactured, how many are in the pipeline, how many do you 
have sitting waiting to be sited and whether or not the 
trailers that the mayor needs are available. And I want to know 
whether or not you have problems with authorization, that you 
do not have the authorization to put the trailers down. And 
after you give me that assessment, I am coming back to the 
mayor to find out whether or not this is an authorization 
problem also. Tell us what you know about trailers.
    Mr. Wells. Okay, thank you very much. First thing I want to 
say, there is not just one problem, Congressman Waters; there 
is many different problems. Let us talk about production, the 
manufacturers. We are told that the manufacturers can produce 
travel trailers at a rate of 550 per day. That is not a 
limiting factor for us. We have several thousand in storage in 
Louisiana. They flow in by rail into New Orleans every day. 
They flow into our storage sites every day. The manufacturing 
part is not a problem.
    Ms. Waters. You have trailers?
    Mr. Wells. We have trailers.
    Ms. Waters. Do you know how many you have that are in 
storage now?
    Mr. Wells. We have--
    Ms. Waters. Totally.
    Mr. Wells. I do not know totally, but in the State of 
Louisiana within our storage sites probably around 2500. But we 
have never been limited by travel trailers. That has not been a 
limiting factor.
    Ms. Waters. Okay, so if you have 2500 in storage here, do 
you have other trailers that are in other locations that can be 
brought to Louisiana?
    Mr. Wells. Oh, yes, they come in all the time.
    Ms. Waters. How many trailers do you need, Mr. Mayor?
    Mayor Nagin. 36,000 total.
    Ms. Waters. How many trailers, if you had all of the 
infrastructure, that is, the ability to hook up with the 
electricity and the water, sewage all of that, how many 
trailers could you have in Louisiana for the mayor of those 
that he just mentioned, those 30,000 or so?
    Mr. Wells. We are doing--we are putting 500 families in 
travel trailers, mobile homes per day; that is an average. That 
is the average.
    Ms. Waters. The mayor says he cannot get the trailers he 
needs. Mr. Mayor?
    Mayor Nagin. Yes, ma'am.
    Ms. Waters. Why can you not get the trailers you need? Do 
you not have the production? Do you not have the ability to 
provide the infrastructure or are you not giving the 
authorization? What is the truth here?
    Mayor Nagin. Well, you know, there are two separate issues. 
The first one is on the 21,000 trailers, the individual sites 
where a homeowner wants a trailer on their particular property. 
You know, in fairness to Scott and to FEMA, we have had some 
issues with permitting and electrical inspectors and Entergy 
has filed for bankruptcy, which created a problem also with 
their inspectors. We have since streamlined a lot of those 
processes. So from that standpoint, you know, everything is in 
place for us to move very quickly to accommodate those. I have 
approved 8000 units to go on group sites, which we have had a 
little bit of controversy about, but we have worked that out. 
There is still 7000 sites that we need to identify that we have 
not identified. That leaves us with a total of 29,000 that we 
could take tomorrow if we had the capacity to put them in.
    Ms. Waters. Let us be very, very clear. The 21,000 
individual sites, these are sites where homeowners say put a 
trailer here on my land or you have a business or someone 
offering you space.
    Mayor Nagin. Right.
    Ms. Waters. Where they say you can use this.
    Mayor Nagin. Right.
    Ms. Waters. And what you are telling me is you have some 
inspection problems and some other kind of problems that does 
not allow you to be able to fulfill those requests, is that 
right?
    Mayor Nagin. We have solved most if not all of those 
issues.
    Ms. Waters. When can you get the 21,000 done if those have 
been solved, if those problems have been solved?
    Mayor Nagin. It is just a matter of the availability of the 
trailer.
    Ms. Waters. The trailers are available, is that right?
    Mr. Wells. I said the travel trailers are not a limiting 
factor. What is the limiting factor? What I think you are 
trying to get to is the limiting factor is a host of things. 
One of them is within New Orleans, the infrastructure. With--
    Ms. Waters. No, no, no, the mayor said that if he gets the 
trailer, he could put 21,000 on the ground, hooked up, whatever 
is needed for 21,000 people now. Do you have the trailers?
    Mr. Wells. Madam, we do not have--it is not--the limiting 
factor is many things. I am going to repeat it. You cannot take 
21--what you are asking, Madam, is you cannot take nine women, 
put them in one room and make a baby in one month. You cannot 
do that. Cannot do that.
    [Audience response.]
    Mr. Wells. You cannot do that. You have to follow a process 
of getting electricity--
    Chairman Ney. If you could suspend, please.
    Ms. Waters. Hold on, hold on, hold on.
    Chairman Ney. Please. May I please remind the audience that 
we are here to resolve some important issues. And I understand 
your feelings, but if we could please have some order, it will 
help resolve that.
    Ms. Waters. Let us back up. Let us not talk about 21,000 
trailers. Let us talk about one trailer. What do you need in 
order to fulfill a request for one trailer of these 21,000 that 
the mayor needs and is ready to accept?
    Mr. Wells. We need the trailer.
    Ms. Waters. You got the trailer. You are manufacturing them 
at 550 per day. You have the trailer. Now what do you need?
    Mr. Wells. We go and do a site assessment to make sure that 
the site is feasible and then if the site is feasible then a 
team goes out.
    Ms. Waters. How many site assessments of these 21,000 that 
the mayor is ready to put down have you done?
    Mr. Wells. I do not know about New Orleans; I can give you 
on statewide site assessments.
    Ms. Waters. No, I just want to know about New Orleans now.
    Mr. Wells. I do not have that broken out.
    Ms. Waters. Do you have problems doing site assessments? Do 
you have enough people to do site assessments?
    Mr. Wells. Site assessment is not a limiting factor.
    Ms. Waters. Okay, so that is not a problem. What is your 
next problem? And how many of the 21,000 can you have done in 7 
days, in the next seven days? How many of these 21,000 that the 
mayor is ready to authorize can you do? How long does it take 
you to do a site assessment?
    Mr. Wells. Not long at all to do a site assessment.
    Ms. Waters. So that is not a problem. You can do the site 
assessments for the 21,000. What is your next problem?
    Mr. Wells. Contractors. Getting the--that is probably the 
biggest limiting factor is crews to do the installation.
    Ms. Waters. Who does the installations?
    Mr. Wells. We have three contractors.
    Ms. Waters. Who are these contractors?
    Mr. Wells. Fluour, Shaw, and C.M. Hill.
    Ms. Waters. Let us stop right now. You are telling me that 
the no-bid contractors that we were all concerned about because 
they we're well-connected and they got their contracts without 
a bid cannot do the work; is that what you are telling me?
    [Applause.]
    Mr. Wells. No, ma'am. What I am telling you, I think one of 
them was a bid. I think the Fluour was a bid contract.
    Ms. Waters. Whether it was a bid or no bid, they cannot get 
this work done?
    Mr. Wells. Not as fast as needed, that is exactly what I am 
telling you.
    Ms. Waters. Well, let us stop right here. We have got the 
trailers and we have the authorizations, Mr. Jefferson. We have 
got FEMA, who can do the assessments and now we have 
contractors, whether it is bid or no bid with contractors, who 
cannot get these trailers hooked up and ready for use. Then 
what should FEMA do in order to expedite getting these trailers 
on the ground so that people can move into them. Do not forget 
that FEMA has set a deadline date and they keep setting 
deadline dates by which people must get out of these hotels. If 
you can set a deadline date and the deadline date does not 
match up to your ability to put the trailers on the ground, 
something is wrong here. Now what do you do--what then do you 
do to solve an obvious problem?
    [Applause.]
    Ms. Waters. What do you do to expedite getting these 
trailers done by the crews that are supposed to--or expanding 
the crews. I understand we have still got money, in this 62 or 
80 billion, whatever this number is. What are you supposed to 
be doing to get it done?
    Mr. Wells. I will tell you exactly what we are doing. We 
are doing different things. It is not all about travel 
trailers; it is not all about mobile homes. It is also about 
getting money into the pockets of the people who had losses. We 
are putting out almost, almost a $1 million an hour 24 hours a 
day 7 days a week for individuals and families to help them 
recover and make up for their losses. That is one thing that we 
are doing. A large part--
    Ms. Waters. What does that have to do with what I am asking 
you about?
    Mr. Wells. A large part of that is for rental assistance to 
where individuals and families can go and rent.
    Ms. Waters. Well, that is what you are supposed to be 
doing. Now that is going to end at some point.
    Mr. Wells. No, ma'am.
    Ms. Waters. Well, even if it does not, but you want the 
people out of the hotels, is that right?
    Mr. Wells. Yes, ma'am.
    Ms. Waters. Where are they supposed to go, sir?
    Mr. Wells. We want to give people viable options.
    Ms. Waters. No, they just want a trailer.
    Mr. Wells. That is one of the viable options.
    Ms. Waters. That is okay. If people had viable options that 
they could exercise, they would be doing it. I have heard all 
of this talk about people putting together their own plans, et 
cetera. We have a lot of people in hotels, in relatives' homes 
across the country who want to come home, but would like a nice 
trailer to come to. Now given all, whatever the other things 
that you must do, all I want to talk to you now about is 
trailers.
    Mr. Wells. Okay.
    Ms. Waters. I want the trailers that are being manufactured 
that somebody is making a lot of money on. I want the trailers 
that are in storage that somebody is making a lot of money on 
to store. I want them where the mayor wants to put them so that 
people can live in them. What then do you do about getting more 
crews, about getting you contractors to do a faster job, hiring 
more people, putting more people on line. What are you doing to 
get those trailers operable?
    Mr. Wells. Yes, ma'am. We have been working with the 
contractors. They have gone up from about 30 travel trailers a 
day to 500. They are continuing to ramp up; they are continuing 
to make progress. They are not making as much progress as you 
want, as we want.
    Ms. Waters. No, no, no, no, not as much progress as I want, 
but as much progress as the people who have been displaced 
would like to have.
    Mr. Wells. Exactly.
    [Applause.]
    Ms. Waters. Again, you cannot keep, you have to take this 
heat today. You are here.
    Mr. Wells. I can--
    Ms. Waters. Do not take it personally, but you are here to 
answer this. You keep setting dates by which these people have 
to be out of these hotels. You keep talking about people making 
plans. But you cannot match the dates that you are putting out 
there. You cannot match those dates in assisting people to have 
this housing. And I want to tell you, FEMA kind of led me to 
believe they were not getting authorizations, Mr. mayor. That 
is why it is so important to get this cleared up today.
    Now you say that your contractors are doing a better job, 
but it is not good enough, Mr. Wells. They are not being able 
to get these trailers operating fast enough to get people out 
of these hotels and into a trailer to have a decent place to 
live even by your deadline date. What then is the answer? What 
is Mr. Pauleson or whoever has that responsibility in FEMA, 
what are you going to do to rectify this situation? Did anybody 
tell you before you came here?
    Mr. Wells. We have tried other things, too, a new 
initiative where we are working with New Orleans, GNO, Inc. in 
New Orleans.
    Ms. Waters. What is GNO, Inc.?
    Mr. Wells. Greater New Orleans, Inc. and others in the 
State to where FEMA can lease an entire apartment complex from 
an owner and put eligible applicants into that complex. That is 
a relatively new initiative that we kicked off about 3 weeks 
ago to supplement the travel trailer, mobile home program that 
we have.
    Ms. Waters. So you cannot get the travel trailers up fast 
enough. And now you are looking at some other alternatives by 
which you can lease whole complexes?
    Mr. Wells. Yes.
    Ms. Waters. To place people.
    Mr. Wells. Yes.
    Ms. Waters. But you have not gotten that done yet.
    Mr. Wells. We are working on it, yes, ma'am.
    Ms. Waters. Now let me ask this; we have a lot of people 
who are unemployed. We have a lot of people who would like to 
come home and have a job. One of the reasons I am interested in 
these travel trailers getting up is not only to have a better 
quality of life, but so that people can have some jobs, so that 
they can earn some money, so that they can help put their lives 
back together.
    One of the things that I am hearing is that they do not 
have enough workers in the restaurants. I was in a restaurant 
last night that normally has 500 workers, employees and they 
were working managing three restaurants with less than 200 
employees. And there was one third the number on the floor last 
night they are supposed to have. This is never going to happen 
until we get the people back. So what then do we do, because I 
want the crews.
    We cannot wait until Fluour and Shaw and the rest of them 
find a way by which to do what we contracted with them to do. 
We need to expand that--and this business about leasing, that 
is okay too. If you are going to lease, but you cannot lease 
and say that you are going to do it for 6 months and if we have 
not done the trailers, people are going to have to get out of 
the places that we leased. The reason that I like the idea of 
trailers is that you are not going to have to any deadline 
dates by which you are going to kick people out on the street 
and hopefully that would be the transition until we can get 
people into permanent housing.
    Mr. Taylor. Will the gentlewoman yield?
    Ms. Waters. Yes.
    Mr. Taylor. The gentlewoman from California needs to know 
that a deadline has been set for occupancy of the trailers and 
it is 18 months from the day of the event. So if you do not get 
you trailer for 12 months, then you only get to live in it for 
6 months. That is the rule. Now the rule can change, but that 
is the rule as of this moment.
    Ms. Waters. Mr. Taylor, when we get back to Washington, 
with the help of our chairman, we are going to introduce 
whatever legislation that is needed to repeal that. I do not 
think it is even in law; it must be a regulation of some kind 
developed by FEMA. So we will take care of that. We are not 
going to have a deadline date on the trailers. Okay, members of 
this committee? Mr. Taylor, we are not going to have a deadline 
date on the trailers.
    [Applause.]
    Mr. Wells. It is a statute, but the statute does allow for 
an extension.
    Ms. Waters. Well, we need to repeal that, Mr. Chairman. 
There should be no deadline date on the trailers.
    Well what you are telling me is that you do not have any 
answers.
    Mr. Wells. No, ma'am, that is not what I am telling you.
    Ms. Waters. Yes, you are.
    Mr. Wells. No, ma'am. What I am telling you is that we are 
doing everything as fast as we can with what we have got and we 
are putting 500 families into homes, travel trailers every day. 
We are putting about a $1 million every hour into individuals' 
and families' pockets.
    Ms. Waters. That is not good enough.
    Mr. Wells. I know it is not good enough.
    Ms. Waters. Let me tell you; we spend a $1 billion a week 
in Iraq.
    [Applause.]
    Chairman Ney. I just want to say that we have got to have 
some decorum in the audience because this will take time away 
from listening and from answers, so if we could please have 
your indulgence. Keep your enthusiasm, but let us have your 
indulgence to try not to have any display.
    Ms. Waters. We can go on with this, but now it is very 
clear to me. At least we have cleared up, Mr. Mayor, it is not 
your lack of authorization. It is your inability to have enough 
crews by which to do the completion work to make those trailers 
work. And you are slow in being able to use the alternative 
that you have attempted to describe, of leasing the apartment 
complexes--that is clear to me.
    Mr. Wells. There is more to that; it is not that simple. 
This not a simple issue. This is not a simple problem. Part of 
it is the authorization. We put--let me give you one example. 
We put travel trailers into a travel trailer park we have. And 
a councilman took them out. He took them out. That is true; 
that happened.
    Ms. Waters. Just a minute.
    Mr. Wells. Yes, ma'am.
    Ms. Waters. You are going to tell me that a city councilman 
took his truck and backed up and pulled out trailers out of a 
park? Is that what you are telling me?
    Mr. Wells. I did--not exactly. I am saying he said we had 
to--
    Ms. Waters. I do not care what he said. What did he do?
    Mr. Wells. We took.
    Ms. Waters. Why did you take them out?
    Mr. Wells. Because the city councilman said.
    Ms. Waters. The city councilman does not have the ability 
to make you pull out trailers from a trailer park. Why did you 
do it?
    Mr. Wells. We are supporting the local officials.
    Ms. Waters. Oh, wait just a minute. Mr. Mayor, I know you 
have land use authority. If the trailers were there in the 
first place, somebody authorized them to be there. I suspect it 
was the mayor and the mayor's office who authorized them to be 
there. Since when or how, maybe there was a vote that was taken 
in the city council. And maybe there was a vote that overrode 
the mayor. But if there was a vote that overrode the mayor, 
with some kind of law it would have had to be signed by the 
mayor or vetoed. How then did a city councilman make you come 
and take out trailers that you had put down.
    Mr. Wells. He did not make us. We work with the mayor, the 
parish presidents, city councilmen because this is their domain 
and we do not set up group sites unless we get their approval. 
That is a problem too because we do have people who do not want 
travel trailer parks.
    Ms. Waters. We know that. We know we have people that do 
not want trailers. Mr. Mayor, how did it happen that there was 
authorizations for trailers to be put down and FEMA went and 
took them out because some city councilman did not want them.
    Mayor Nagin. You know, the city council did express 
concerns about some trailer sites. And there was a period of 
time when there was a veto and an override of a veto and then 
basically we cleared it up by basically saying as long as the 
city is in a state of emergency that I have full authority on 
designating these trailers sites. So we went through a period 
of time when that was not clear to FEMA. It was always clear to 
me. But obviously, it was not clear.
    Ms. Waters. So am I to understand that FEMA is not going to 
go back and take out trailers once you authorize them?
    Mayor Nagin. You are going to have to ask them that. But 
let me just point out something to you. I approved 8000 travel 
trailer sites. And we went through this process and got to an 
understanding on those. But there are still 21,000 requests for 
individual sites on individuals' homes that if we put some 
focus on that, I think that we can make some serious progress.
    Ms. Waters. He does not have the crews to get them done. 
You do not have the crews to get them in those 21,000 sites, is 
that right?
    Mr. Wells. In what time frame are we talking about?
    Ms. Waters. Yesterday.
    Mr. Wells. No, I do not. I cannot do it by yesterday.
    Ms. Waters. How long will it take you to do it?
    Mr. Wells. Right now, I can promise you 500 a day because 
that is what we can do.
    Ms. Waters. Okay, how do we increase that from 500 to 1000 
a day? I know we are not going another 5 months with this 
business. How--how do we increase the number of people who are 
involved in putting these trailers in, the crews that you need? 
How do you do that?
    Mr. Wells. We do that by working with the contractors and 
giving them quotas and working with them and helping work 
through the problems. One example is they came back and they 
said they had a problem because Entergy was in bankruptcy and 
they did not have enough crews and they were prohibited from 
working on weekends. They were prohibited from working overtime 
and they did not have enough crews for the electrical part that 
Entergy is supposed to do. So the Federal Government spent $20 
million to get a contractor to do the part that Entergy is 
supposed to. And then Entergy then came back and said we have 
got to inspect the stuff that we asked you guys to do. And that 
created another delay.
    Ms. Waters. So what you are telling me is that--is it 
Entergy.
    Mr. Wells. Entergy, yes, ma'am.
    Ms. Waters. Was supposed to do the electrical work, is that 
right?
    Mayor Nagin. Inspections.
    Ms. Waters. Inspections. They went bankrupt, is that right?
    Mayor Nagin. That is correct.
    Ms. Waters. And you contracted with someone to come in and 
do the inspection work that Entergy was supposed to do, is that 
right?
    Mr. Wells. Not exactly. We actually did some of the work 
that they were supposed to do, running the power from the 
street all the way to the house or to the travel trailer.
    Ms. Waters. Okay, so you did the work, whoever did the 
work. And then, Entergy came back and told you that they had to 
do the inspections. Because if they did not do the inspections 
what was going to happen?
    Mr. Wells. Put the meters in, we wanted to put the meters 
in and they said, no we have to put the meters in. We said, we 
can put the meters in and so, it was a matter of them putting 
the meters in, running the last part and doing the inspection.
    Ms. Waters. Excuse me, Mr. Mayor, why then could not FEMA 
who claimed it had to pick up where Entergy dropped the ball, 
why could not they just complete the work? Who cares what 
Entergy thinks at this point? What happens if they do not do 
the inspections and they did put in the boxes and they did do 
the inspections, what happens?
    Mayor Nagin. I am not that close to it. You know, I would 
think you would have to get meters from Entergy, right, Scott?
    Mr. Wells. You do, but they wanted to do the meters 
themselves and we said, just let us do the meters because you 
do not have enough folks. And you cannot, you know, you cannot 
work overtime and on weekends.
    Ms. Waters. Excuse me, the meters. Where do you get the 
meters from if you were going to put them in?
    Mr. Wells. I got them from Entergy.
    Ms. Waters. Is there anyplace else you can get them other 
than Entergy?
    Mr. Wells. I think it is a matter of protocol.
    Ms. Waters. I do not care about protocol. Where else could 
you get the meters?
    Mr. Wells. I do not think that is the issue, ma'am.
    Ms. Waters. Well, I am asking you. Do you know whether or 
not you could have gotten the boxes someplace else?
    Mr. Wells. What I know is that Entergy, for whatever 
reason, did not do what they normally do for their part for the 
electrical part. Without electricity, you cannot put travel 
trailers in; that is what I know. What I know is we did a work 
around by doing--by obligating $20 million to try to do that 
part. We put the $20 million, we put the contractor out and it 
still did not work because of Entergy not allowing us to do the 
full part that we thought we were going to be able to do. That 
is the part I know, and those travel trailers never got 
electricity.
    Ms. Waters. Excuse me, Mr. Mayor, how is it that Entergy 
can stop you from doing what needed to be done to get those 
trailers hooked up to electricity? How would they stop you? 
They put a gun to your head?
    Mr. Wells. We can put--the travel trailers are there, 
ma'am. They are sitting there; the travels trailers are there; 
they just do not have electricity.
    Ms. Waters. What do we need to do to put the electricity 
in?
    Mr. Wells. We need Entergy to do their part.
    Ms. Waters. What if Entergy does not do it; would you wait 
forever if they decided that they could not do it? Is there 
another way to do it?
    Mr. Wells. We talked to the mayor; we talked to the 
Governor; we had a meeting. We got fixes in place; that is 
being fixed.
    Ms. Waters. No, I asked a question. If Entergy never really 
cooperated with you, what would be the alternative? Would you 
wait forever and just sit there and say it cannot be done if 
they did not do it? Is there another way by which to get it 
done?
    Mr. Wells. I do not know of another way, no.
    Ms. Waters. Why is that, sir? Why is it that nothing can be 
done? Let me tell you why I am asking. I am asking because as I 
understand it, in New York with 9-11, they brought people in 
from all over the world to do what needed to be done in order 
to get that city up and running.
    [Applause.]
    Ms. Waters. They had people who even came and went 
underground and underwater and did mapping. They had that 
electricity back up. I want to tell you what is shameful. It is 
shameful for us to be here today and to go through communities 
that do not have basic electricity. Do you know what one of the 
big issues is with Iraq? Getting that electricity up and that 
energy going. I cannot imagine why it cannot be done here in 
New Orleans. Now FEMA, tell me if Entergy did not cooperate 
with you, could not do, would not do, would you sit here 
forever and not get it done?
    Mr. Wells. No, ma'am, we are not sitting here forever. That 
is why we got the $20 million. That is why we went to see the 
Governor and the Mayor. We put fixes in. This is a progressive 
thing; as we see problems, we fix the problems. We do not sit 
around and say oh, we cannot do that.
    Ms. Waters. But you are talking about it is going to take 
you 6 months to put in the mayor's 21,000 trailers. But you are 
saying that people have to be out of their hotels by March. And 
you are also saying that you do not have the leases done on the 
alternative sites, leased sites that you are talking about. So 
you know that there is a date certain again that you are trying 
to get to. But you cannot tell me that you are going to have 
these 21,000 trailers up for another 6 months maybe because of 
Entergy and your contractors who are not able to do it fast 
enough; but you do not have any other alternative. Is that what 
you are telling me?
    Mr. Wells. No, ma'am. What I am telling you is that we do 
have alternatives. We have several hundred brand new travel 
trailers, mobile homes, brand new, ready for occupancy in other 
parts of the State and we cannot get people in them. They are 
available. They are new. The keys are ready to go. Ready to 
move in. It is just not where people want to go.
    Ms. Waters. Well, let us not go there. Let us go down to 
this 21,000 the mayor has got authorized. Before we do that 
because we have not even talked about Mr. Taylor, who talked to 
you and thanked you for what you have done. But he talked about 
how many other people are waiting. We have not even gotten to 
Mississippi yet. But while we are here in New Orleans, tell me 
how you are going to get 21,000 trailers that have been 
authorized by the mayor in in the next 30 days. Thirty days, 
just tell me that.
    Mr. Wells. Twenty one thousand in 30 days, that is just not 
going to happen. Based on the capacity we have now in New 
Orleans, that is not going to happen. We do have brand new 
trailers, mobile homes ready for people to move in. They are 
just not in New Orleans. People are not--I think it is very 
important, and you have come here to learn. I think it is a 
very important message to get out. Two things, one that FEMA is 
committed that anybody that had losses and is eligible for FEMA 
assistance is going to have a viable option for housing. They 
are going to have money in their pockets to rent an apartment 
or a home or they will have a travel trailer or mobile home. 
They may not get their first option. They may not get an 
apartment or mobile home or travel trailer in the New Orleans 
area for several months because the infrastructure is just not 
there.
    Ms. Waters. Mr. Chairman, I am going yield back my time. 
But let me tell you this, Mr. Wells. I do not want you to take 
this personally. First of all, I just do not believe you. I do 
not believe you because, number one, what you have not shared 
with this committee is the notion that each of those 
individuals in hotels that have been threatened with a deadline 
date have to come up with a plan. We have not talked about the 
plan at all. And this plan is a plan by which they must submit 
to FEMA that they had thought through where they are going, how 
they are going, how long it is going to be, et cetera, et 
cetera.
    Now let me tell you, Mr. Wells, and I will tell Mr. 
Pauleson this. It does not make good sense to me because I saw 
a woman on television about 70 years old who does not know what 
the hell you are talking about when you talk about a plan. And 
you do not have anybody there to assist her in putting together 
this so-called plan. She does not have an alternative; that is 
number one.
    Number two, I do not care what Fluour's problem is. I do 
not care what Shaw's problem is. I do not care what these big 
contractors who have got no bid or bid contracts--I do not care 
what their problems are. The fact of the matter is we need them 
to deliver. I am not here to tell the people of New Orleans or 
Mississippi to be patient. And I do not want to get anybody in 
trouble. But I am not George W. Bush to come here to try to 
make people feel good about the position that they found 
themselves in. I am here to try and find out what is wrong with 
this system, why we cannot have electricity, why we cannot have 
trailers, why we cannot move people out of hotels. I am here 
because there are hotels telling people they want them out by 
Mardi Gras time. I am here to find out why FEMA cannot do 
better and even though you think FEMA is doing the best job 
that it can do, it is not good enough, sir.
    And I want you to know and I do not want you to take this 
personally, FEMA does not have the best reputation in the 
world. Your response was slow here. People were in that dome 
and outside of that convention center with America watching 
begging for help with signs that said please help me, I am 
drowning. You did not even know they were there. So you do not 
have a good reputation. And we do not believe you when you say 
that nothing else can be done. We are here to say that it has 
to be done. And I do not care about Entergy or anybody else. We 
have to find the people wherever they are to come in here and 
get the work done. It is not fair to ask the people to continue 
to wait.
    [Applause.]
    Ms. Waters. So Mr. Chairman, you have been more than 
generous with your time. I think at least we have unveiled 
something here. We have unveiled something here about some of 
the misinformation that we are getting about the ability to get 
these trailers on the ground, Mr. Taylor. And we are going to 
hear some of the same thing I guess about Mississippi.
    So with that, I am going to back off of Mr. Wells for a 
while. I am going to Mr. Pauleson. But Mr. Chairman, what we 
have got to do is we have to get people on the ground here 
inside FEMA and these contractors, these contractors, moving 
this agenda. It is unacceptable what we have heard from you 
here today.
    Thank you, Mr. Chairman.
    Chairman Ney. We are going to move on, but I want to make 
one comment. You have got to understand too in Washington since 
this started, we have been on this issue because the trailers 
seemed the way the people could remain here versus being 
scattered across the country. But in D.C., it has been quoted, 
I think it has been quoted, that thousands of these could be 
produced with the drop of a hat. That is what we have been 
told. And FEMA--in fact FEMA asked for an unusual amount of 
these trailers and then was criticized by some people, what do 
you want all those trailers for? It was like 100,000 of them, I 
think, they requested when this started if I remember 
correctly.
    Ms. Waters. They did.
    Chairman Ney. I want to know what happened with those.
    Ms. Waters. And I still want him to reiterate how many are 
sitting in storage somewhere. And where are these storage 
places? How many trailers are completed and sitting up there 
that you would draw on for this 550 per day that you can put 
up?
    Mr. Wells. Well, it is a just-in-time thing. They come from 
the manufacturers every day. Within the State of Louisiana we 
have 2000 or 3000, about 2500. But they come in every day. 
Again, that is not a limiting factor for us. We are never for 
want of a travel trailer.
    Ms. Waters. Okay.
    Mr. Wells. That is not keeping us--we never say oh, there 
is not one there, so we are at work stoppage. That is not 
causing work stoppage.
    Mr. Jefferson. What does he need to get this production up 
from 500 a day to some other number? What is required to do 
that?
    Mr. Wells. We need I guess two things. And the first thing 
that we need is more contractor capability and we do need to 
get the group sites, approval for more group sites. It takes 
awhile to get these group sites up. An individual site--
    Chairman Ney. Who approves--two questions. Entergy, just 
for my edification, that is a private company, correct, 
Entergy?
    Mr. Wells. It has some relationship with the city; maybe 
the mayor can elaborate on that.
    Chairman Ney. Oh, it is; is it a muni?
    Ms. Waters. It is private.
    Chairman Ney. It is not a muni; it is a private utility. 
Then you just made the statement and I interrupted myself and I 
forget exactly how you said it. Site approvals. What is that? 
Is that a problem within here? What is the site approval 
problem you have got?
    Mr. Wells. For individual sites, it is not an issue because 
if an owner calls up and they are trying--
    Chairman Ney. I saw some today.
    Mr. Wells. But for group sites where we have to put renters 
in the group sites, the local officials have to approve that.
    Chairman Ney. Would you call that a mobile home park?
    Mr. Wells. Yes. A mobile home park, travel trailer park.
    Chairman Ney. Okay.
    Mr. Wells. Yes, sir.
    Ms. Waters. Mr. Chairman, that is not the problem because 
it does not matter whether it is an individual site or a group 
site, you cannot get them done.
    Mr. Wells. Ms.--
    Ms. Waters. You cannot get them up because Entergy and the 
contractors cannot do the work that you need to be done, you 
need to have done in order to get them up. Now as I understand 
it, these contracts that you have, you have an escape clause in 
the contract with Fluour, is that right? You can get out of 
these contracts any time you want. Do you have an escape clause 
if they are not performing to the capacity?
    Mr. Wells. I am sure there are provisions for that, yes, 
ma'am.
    Ms. Waters. I beg your pardon. You have escape clauses. 
Does anybody know this stuff. Who has--who knows what the 
contracts entail here? Have you seen a contract?
    Mr. Wells. I have not read the contract, no, ma'am.
    Ms. Waters. So you do not know about whether or not there 
is an escape clause?
    Mr. Wells. I know that we can get out of the contract. I 
mean the limit--the agreement for the contract, they have 
already met that.
    Ms. Waters. Let me ask you something. If you hired 100 new 
small businesses and gave them X number of trailers to put up, 
could you not get that done?
    Mr. Wells. We have tried things like that.
    Ms. Waters. Ah, come on.
    Mr. Wells. I will give you two examples. We went with two 
parishes. We went with St. Bernard Parish and with the parish 
president; we gave him 50 travel trailers and he is hiring 
people to install those. So that is an option. That is an 
option for parish presidents, the mayor, anybody. We will give 
them travel trailers and they can hire people to install them. 
We are doing that.
    Ms. Waters. Wait just a minute. If you give them the travel 
trailers, do you give them the FEMA money that comes along with 
it?
    Mr. Wells. Here is how it works.
    Chairman Ney. We are going to have to move on.
    Mr. Wells. We give them the travel trailers. They would 
hire somebody to haul and install and then submit the bills to 
us under public assistance. And we could reimburse them.
    Ms. Waters. No, let me--I am going to leave this alone. Mr. 
Taylor, Mr. Melancon, we need to take a look at this. We need 
to take a look at it because--if they have the ability to hire 
people to do this work, you are talking about a city with no 
money and you are asking them to go out and contract with no 
revenue streams and wait for you to reimburse them. I would not 
trust FEMA to reimburse me once I made a contract. That money 
needs to flow, Mr. Melancon, ahead of time so that they have 
the money in the bank by which to pay local small businesses to 
get this work done, and I am going to leave that with you.
    Mr. Melancon.  If I could, Mr. Chairman. Most of the small 
contractors that are doing the work are calling and complaining 
because they are not getting paid fast enough.
    Mr. Taylor. Mr. Chairman, if I may.
    Chairman Ney. And I would note we have a second panel, and 
out of due respect to them we have got to move on.
    Go ahead.
    Mr. Taylor. To this point, what you are going to find 
tomorrow in Mississippi is that since the storm, about 95 
percent of the work in my Congressional office has been exactly 
to this point. To Ms. Waters' point, Ms. Waters, please.
    Ms. Waters. Yes.
    Mr. Taylor. Okay, since, for whatever reason, the gentleman 
did not answer the question, it takes three things to set up a 
travel trailer.
    Ms. Waters. Okay.
    Mr. Taylor. You have to send a crew out to identify where 
the sewer line was.
    Ms. Waters. Okay.
    Mr. Taylor. You have to have running water.
    Ms. Waters. Okay.
    Mr. Taylor. And you have to have electricity.
    Ms. Waters. Okay.
    Mr. Taylor. You or I could probably go and find some 
healthy eighth graders and in a matter of hours train them to 
do the water and the sewer, PVC pipe--no I am serious. PVC pipe 
is very easy; hooking a water hose is very easy. The technical 
part is the electricity.
    Ms. Waters. Okay.
    Mr. Taylor. In that you can either burn up the trailer and 
the occupants or kill the person hooking it up. That does 
require a skill.
    Ms. Waters. Okay.
    Mr. Taylor. Now what I have been frustrated about in 
Mississippi is just the opposite. In Mississippi, why I am 
frustrated is you are sending out one crew to erect a temporary 
power pole for the electricity to go to the trailer. But the 
power company is also sending out another crew to go from the 
street line to the power pole. And what I have been begging 
FEMA to do is to combine that. Just send one crew out and 
whoever is going to run it from the street line to that power 
pole is also the same company that is going to run it to 
trailer. There is no reason to send--to duplicate that effort. 
There is always one more reason why something does not get 
done. And one of the things I would hope this task force would 
look at is in the future give FEMA the authority to just get 
one person to this and get it done. It is going to require some 
tweaking of State laws and municipal codes.
    Now the second thing you are going to discover and you are 
real close to getting there yourself. The folks who got these 
contracts are not paid by the trailer. They are on cost-plus 
contracts. They are paid for every mistake. And they are paid a 
percentage on top of their mistakes. They will haul the trailer 
to the site, determine that it is not right, bring it back to 
the staging yard, they get paid. They will send a crew out 
tomorrow to do the same thing, haul it back to the site, they 
get paid. They get paid for all of their mistakes. No one else 
in America gets paid for making mistakes.
    So again, maybe the gentleman was not at liberty to say it. 
I will tell you we need to take a very serious look at these 
contracts. Because in the case of Mississippi our contractor 
was Bechtel. I called a member of the Bechtel family and tell 
them what shabby work they were doing in Mississippi and they 
do a lot of work for the Department of Defense. If they are 
doing work this bad in my backyard, what are they doing in 
Iraq?
    So, again, I did not want to monopolize this, but I would 
hope the chairman would make a few minutes to take you to a 
site where we parked a trailer in Mississippi tomorrow morning 
so I can walk you all through this. Because I am glad that you 
are addressing it. It has to be addressed because this is not 
the last natural catastrophe that is ever going to hit this 
Nation. We need to get these folks; we need to get my folks. 
And for the next time that it happens, we have got to do a heck 
of a lot better.
    Thank you, very much.
    Ms. Waters. Thank you.
    Chairman Ney. Mr. St. Julien. And then Mr. Williams.

 STATEMENT OF MTUMISHI ST. JULIEN, EXECUTIVE DIRECTOR, FINANCE 
                    AUTHORITY OF NEW ORLEANS

    Mr. St. Julien. Thank you very much. I am Mtumishi St. 
Julien of the Finance Authority of New Orleans.
    As co-chair of the housing committee of the Bring Back New 
Orleans Commission, we hosted a mortgage bankers summit and we 
used it as an opportunity to bring together the entire industry 
of large mortgage bankers, the GSE, all the major services, and 
so forth to come and discuss what we will really need to make 
sure that the funds are spent properly and how to get the 
financial industry back into this.
    I have a whole list of things and I ask that this committee 
allow me to put this in the record.
    Chairman Ney. Without objection.
    Mr. St. Julien. Plus, they added the minutes of the 
mortgage banking summit so that you can have that. I will be 
willing to discuss this in more detail with your respective 
staffs. They have a whole list of what the financial industry 
calls esoteric issues which will help. For example, Congress 
increased the home improvement from $20,000 to $150,000. 
Wonderful, great, we need that. The problem is that home 
improvement in the Section 143 of the Internal Revenue Code is 
primarily a second mortgage product. Well, FHA does not have 
insurance for single family products. So again, what happens is 
the lender is a little discouraged from using that and we need 
that.
    That is just an example of the list of things that we can 
have, we can discuss.
    On the issue--and ranking member, I just wanted to make a 
comment; we are a governmental agency. We have a unit of 236 
units as a governmental agency. The Stafford Act allows us to 
get public assistance from FEMA. We set up the Willows as a 
501(c)(25), which under the Internal Revenue Code is an 
instrumentality of Government. But somebody made a decision 
that we needed to be treated just like 501(c)(3)s, which has a 
different standard in the Stafford Act.
    So when the issue comes up whether FEMA can come in, 
removing the reimbursable basis, they have the power to come in 
and help us deliver 236 units almost immediately if they would 
just come in and help us. We have essential employees that need 
housing. We have police; we have firemen; we have teachers; we 
have other people who need housing--that is an alternative.
    Another alternative to this discussion about FEMA is if the 
trailers, other than the cost of probably the labor time, the 
contract is $75,000 a trailer. We have thousands of units that 
had relatively minor damage that FEMA can come in and use that 
$75,000 to help fix that unit under the condition that the 
owner will give them a lease to get our people back in the 
city. Our people want to come back in the city. It is important 
that we get them back in the city because New Orleans has made 
and continues to make great contributions to this country. Not 
only with oil and gas, oil and gas does not come up from the 
ground by itself. It is the people who bring this to this 
country. The culture that people all over the world love and it 
is our people, it is really poor people that have developed a 
lot of this culture.
    I was blessed during the holidays to spend Christmas and 
Kwanza in Ghana in talking to people there. There were a few 
chiefs who said that they had tears in their eyes looking at 
CNN at what happened. They envy this concept of the American 
dream that they see in America, that people want houses, that 
we have a financial institution that can help deliver houses. 
But now they are starting to wonder whether this issue of this 
value that we broadcast all around the country of the American 
dream is really a value or is it merely propaganda. They are 
waiting and they are looking.
    Congress has a long history of taking leadership in 
housing. When this country was in trouble during the Great 
Depression, it was Congress who stood up. It was Congress who 
thought out of the box, came up with this idea of this 
insurance company that could help people buy homes. So they 
created FHA in 1934. It was Congress, when this country had 
liquidity problems throughout the banks, and they said okay, we 
will collateralize this. So they created Fannie Mae, Freddie 
Mac, Ginnie Mae to solve that particular problem. Now Congress 
can continue that legacy and you have a bill before you from 
one of your Members, Congressman Baker, which we support that 
bill.
    Why we support HR 4100 is because our people followed this 
American dream. They were told as poor people that if you buy a 
house, if you pay your mortgage on time, you can do like the 
19th century immigrants did and pass this on to generations. 
This is part of the American dream; this is what you have to do 
to be there. They have done that, but because of no fault of 
their own, primarily a man-made disaster, they lost everything. 
To make this American dream real again, not only to us, to let 
our people know that this is a real value in this country, but 
to tell the people all over the world that this is a real value 
and not just propaganda, we need to help make our people whole. 
We think that Congressman Baker is on the right track. HR 4100 
is very, very important to be able to give our people some of 
the equity that they need so they can have those choices and 
rebuild. They want to come home. They will come home. They need 
to come home.
    Thank you so much.
    Chairman Ney. Thank you.
    [Applause.]
    Chairman Ney. We will move on to Mr. Williams. I just want 
to note again, we passed that piece of legislation out of our 
committee and so we need to get it to the floor of the House 
and then over to the other body.
    Mr. St. Julien. Thank you so much.
    Chairman Ney. Mr. Williams. And we are going to have to 
move to the 5-minute rule. I will let you know when your time 
is expired and the members, we will have to try to hold to it 
because we have got another panel and I want to make sure we 
get that panel in.
    [The statement of Mtumishi St. Julien can be found on page 
172 in the appendix.]

 STATEMENT OF CHARLES H. WILLIAMS, DEPUTY ASSISTANT SECRETARY, 
     MULTI-FAMILY HOUSING, DEPARTMENT OF HOUSING AND URBAN 
                          DEVELOPMENT

    Mr. Williams. Mr. Chairman and ranking member and members 
of the committee, I am Hank Williams with the Department of 
Housing and Urban Development. It is a privilege to talk with 
you today, especially as we are going to be able to address 
some of the concerns that Representative Jefferson brought up 
earlier. We think that is a very important part because the 
Department is very focused on the importance of housing as it 
impacts the recovery in this area.
    I ask that you accept the department's written statement, 
which contains a lot more detail, as part of the record.
    Chairman Ney. Without objection.
    Mr. Williams. The Katrina, Rita, and Wilma disasters 
thoroughly tested all us as far as our abilities to handle 
disasters, and the President has directed Federal agencies to 
adapt to the extraordinary challenges presented by the most 
extensive natural disaster in this Nation's history. Responding 
to the President's direction, Secretary Jackson mobilized the 
resource of HUD and I would like to describe just a few of the 
many efforts undertaken to help people recover and rebuild from 
the devastation caused by these hurricanes.
    Mr. Cleaver. Mr. Williams, we cannot hear you.
    Mr. Williams. HUD worked with FEMA in the early days of the 
disaster to get housing assistance to those who had been 
displaced and uprooted by these hurricanes. This partnership 
along with other partnerships with USDA, VA, HHS, and others 
demonstrated the dedication to providing the housing 
assistance. Some of the best examples of those joint efforts 
were the Katrina Disaster Housing Assistance Program. 
Everything in the Federal Government needs an acronym and that 
is called KDHAP. KDHAP and the Joint Housing Solution Center, 
which we call JHSC, were established to address housing issues 
specifically.
    It was also provided--HUD also provided hundreds of staff 
members to staff the disaster recovery centers throughout the 
Gulf Coast area and also to participate in other disaster 
relief efforts. The program offices at HUD were aided in the 
recovery process as well--have aided in the recovery process as 
well.
    Administered by the Office of Community Planning and 
Development, the Community Development Block Grants (CDBG) 
Program is a very, very powerful rebuilding tool. As you know, 
the President recommended funding for CDBG to assist local 
communities with their planning and the recovery and 
rehabilitation process. The Congress and the President approved 
$11.5 billion in additional CDBG funding as well as almost $400 
million for public housing authorities to assist in the 
recovery and housing efforts.
    In addition, Community Planning and Development issued 
waivers of more than 40 requirements within the existing grant 
programs for the States of Louisiana, Mississippi, and Alabama 
in an effort to increase the flexibility to use their current 
resources for the disaster relief. For an example, CPD issued a 
series of waivers in the home program that included self-
certification of income, elimination of matching requirements, 
and greater flexibility to help these very low income families 
receive tenant-based rental assistance and to rehabilitate and 
buy their homes.
    Office of Housing took the lead and was the original and 
first one to implement a 90-day moratorium on foreclosures. And 
this was in all the disaster relief, disaster declared areas 
for both Hurricanes Rita and Katrina. Then on November 22, 
Secretary Jackson and Commissioner Montgomery extended that 
foreclosure moratorium for an additional 90 days to February 28 
of 2006, for all those counties that were in the declared 
disaster areas. This extended foreclosure relief will provide 
mortgage companies additional time in which to confirm the 
homeowners' intention and ability to repair their home and then 
to resume mortgage payments and to retain home ownership.
    In December, the department took an additional step which 
was to provide a retention opportunity for those homeowners 
with FHA-insured mortgages that worked or lived in the 
presidentially declared disaster areas. Under this initiative, 
HUD will advance to these homeowners up to 12 months of monthly 
payments so that they will be able to forego payments during 
this period of time when they are trying to re-establish their 
homes and to find employment. This was an unprecedented step, 
one that was taken for the first time and was a very creative 
process that the HUD went through to try to determine what our 
resources were to be able to do this. And this can help up to 
20,000 families that are seriously impacted by the hurricanes.
    Chairman Ney. Time's expired. If you would like to 
summarize--time's expired, if you would like to summarize.
    Mr. Williams. Sure. In addition, there are several other 
programs that were very extensively thought through and 
evaluated to be able to provide the resources that would help 
in this particular disaster. And the HUD staff worked very 
diligently to be sure that these programs not only matched up 
with the need but were delivered expeditiously.
    Chairman Ney. Thank you.
    Mr. Williams. Thank you.
    Chairman Ney. Mr. Wells, I think you already--
    Mr. Wells. I want my 5 minutes.
    Chairman Ney. There you go; you have got your 5 minutes. I 
am not going to arm wrestle you.

 STATEMENT OF SCOTT WELLS, FEDERAL COORDINATING OFFICER FOR DR-
  1063-LA, FEDERAL EMERGENCY MANAGEMENT AGENCY, DEPARTMENT OF 
                       HOMELAND SECURITY

    Mr. Wells. I want Ranking Member Waters here too. Is she 
here? Thank you, and thank you for coming. It is very important 
to come see this and connect emotionally. We see this every 
day.
    We are trying to do the best that we can. But it was a 
catastrophe; it was a big disaster. There is no infrastructure 
in St. Bernard Parish. There is virtually no infrastructure in 
New Orleans. It is tough. I wish we could have had a more 
thoughtful approach because it is not one problem--it is not 
the contract; it is not Entergy; it is not the city; it is not 
the parish; it is not FEMA.
    It is a big disaster with many problems. We are doing 
better than we have ever done in doing what we are doing in 
helping these communities recover in travel trailers and mobile 
homes. We are doing the best we can. We are stretching 
everything we can. We have gotten better. We will get better.
    All that being said, we know this is not enough. We are 
going on 5 months. We realize people are not getting on with 
their lives because they do not have a permanent type of 
housing.
    The difference between the discussion we had today, at 
least my part, in what the Federal Government, what FEMA does 
and what some of the expectations are, there is a divergence. 
Our focus, our commitment, is to get anybody that is eligible 
that had losses from Katrina or Rita to give them some viable 
options. The Stafford Act allows us to do that.
    We do that by basically two ways. Give people money so they 
can rent an apartment, a house, a condominium, or something, 
rental assistance up to 18 months and that can be extended or 
give them some direct housing in the way of mobile home or 
travel trailers. We are doing that. Most everybody has gotten 
money.
    The last thing that I want to say is, and this is very 
important, we have people who are not--who want to have their 
first option. They want to come back to New Orleans. They want 
to come back to St. Bernard. They want to come home. I want to 
go home too. I have got a home to go to. But I am not going 
back to my home until these folks get their home. But everybody 
is not going to get their first option right away. There is a 
cold hard fact in that people that lived in this area will not 
be able to come back for months or maybe years because there is 
not the housing stock to do that.
    That does not mean they do not have a viable option. They 
do. They will have rental assistance. We have mobile homes and 
travel trailers in other parts of the State. So we are not 
leaving people homeless. There is an option. There is a bed; it 
is equipped; there is electricity; there is water. It just may 
not be where they want it. It may not be their first option, 
but we are not turning anybody away. There are places for them 
to go. That is our commitment.
    Thank you very much.
    Chairman Ney. I appreciate your time.
    Questions? The gentlelady from California.
    [The statement of Scott Wells can be found on page 181 in 
the appendix.]
    Ms. Lee. Thank you, Mr. Chairman, I would like first of all 
to go back to a couple of issues that the mayor raised and just 
see if Mr. Williams or Mr. Wells or Mr. St. Julien could answer 
or clarify those issues.
    First of all, the mayor indicated that he still does not 
know where a lot of the residents of New Orleans are. And he 
cited, and he mentioned this to us in Washington, D.C., some 
issues around privacy. And as one who cares about and values 
our privacy laws, I mean, and who is very much against the 
domestic spying that is taking place now and the surveillance 
and wire tapping, I share and understand the reasons for 
privacy. However, I also know that oftentimes agencies play a 
lot of games with our privacy laws.
    And this morning, on the tour we asked about, first of all, 
how many residents were unaccounted for and we heard that there 
could be up to 3000. And secondly, hearing now from the mayor 
with regard to still not knowing where people are, I am 
wondering--but yet we heard that HUD may know where public 
housing residents are, 95 percent of them. I am wondering why 
the mayor does not have this information and what the privacy 
rules are as you see them that is prohibiting the mayor from 
receiving the information that he needs and that everyone needs 
so that families can be contacted, individuals, and assisted in 
their return home.
    Mr. Williams. Let me respond from HUD. We do have a good 
understanding of where most, 95 percent, of the public housing 
residents are. And that represents about 9600 families within 
the metropolitan area. But we can also provide contact 
information and if there were materials that the mayor wanted 
to provide to those individuals, it is our understanding that 
we can provide that to them. So we can work with the mayor's 
office to provide that information to them.
    Ms. Lee. But, Mr. Williams, I guess then I am wondering why 
that has not happened. What is going on in terms of--is it lack 
of communication? Is it--what is the deal?
    Mr. Williams. Let me refer to Dr. Moon here is with our 
local housing authority here. Oh, she is gone. Maybe Milan 
Osadeck can help us a little bit with that too.
    Mr. Osadeck. Madam Congresswoman, I am not aware of any 
request from the city to the Department requesting information 
on individual residents. At this point in time, we do have the 
last known address of those families that had registered for 
FEMA assistance. We are using those addresses to send post 
cards, to try to contact these families, to try to get them 
assistance through the KDHAP program.
    Ms. Lee. Well, you heard the mayor earlier saying that he 
could not get those lists. So I guess could this committee make 
a request that those lists be forwarded to the mayor, just out 
of courtesy, if nothing else? I mean he needs them.
    Chairman Ney. If the gentlelady will yield. Is there 
anything to prevent the mayor from acquiring the list from you?
    Mr. Osadeck. I am not an expert on privacy laws, Mr. 
Chairman, but I can certainly, when I go back to Washington, 
find that out.
    Ms. Waters. Do not find it out. Tell them.
    Chairman Ney. You can give us the list is what you are 
saying.
    Ms. Lee. Can we get the list, this committee?
    Chairman Ney. Are we allowed to have the list?
    Mr. Osadeck. I do not know the answer to that.
    Chairman Ney. Okay.
    Ms. Lee. We are not allowed.
    Chairman Ney. We will find out.
    Ms. Lee. Mr. St. Julien.
    Mr. St. Julien. Madam Lee, may I make a suggestion? I mean, 
this issue, there is some Privacy Act problems involving this. 
But it is very simple that FEMA ought to have responsibility to 
send a notice to everyone asking them for their permission to 
be able to provide that information to the officials so that 
they can get official information. If people had that option to 
get that official information about what is happening in their 
city, most of them will probably say yes. And at that point we 
will be able to do that.
    Ms. Lee. Let me ask FEMA, have you done that? And also, 
does the Governor have that information? Do we have that 
information? Does HUD have that information?
    Ms. Waters. The Governor has the information. You gave it 
to the Governor.
    Mr. Wells. I think we have already provided the 
information, one. That issue came up on voting and there was a 
bad disk and the disk was corrected. I think that information 
has already been provided. So I think that has already 
happened.
    Ms. Lee. But where did the information go. Who was the 
recipient?
    Mr. Wells. I do not know, whoever asked for it. Some of the 
State agencies, yes. So they got the information. There is only 
four criteria that you have to meet. You meet the four 
criteria, then we provide the information. We are not trying to 
withhold it.
    Mr. Melancon. It is the secretary of state; the secretary 
of state is in charge of that.
    Ms. Lee. The secretary of state has it?
    Mr. Melancon. I think that he has gotten it now.
    Mr. Wells. I think that is who has it; it is a state 
agency.
    Chairman Ney. Can we just suspend for a second?
    Ms. Pratt. The secretary of state--I am Councilwoman Renee 
Gill Pratt from New Orleans. The secretary of state and the 
attorney general was going to sue FEMA in order to get the list 
so that they can then notify our citizens about the upcoming 
election and then FEMA turned over the list to the secretary of 
state. And at that time, that is the only person who could use 
the list. However, elected officials asked could we also get 
that list, and they are supposed to go back and ask could they 
get that list, because our constituents call us every day 
asking us what is going on. But we have no way of notifying and 
telling the others what is exactly happening in their own city. 
So they have to give the authorization so that all can have it.
    Ms. Lee. So FEMA should notify the secretary of state to 
release that information to whomever is requesting it?
    Ms. Pratt. Yes.
    Mr. Wells. No. The secretary of state requested it and we 
gave it to him. Somebody asked it to us; we gave it to who 
requested it. That is what we have done.
    Chairman Ney. So if we requested it, we can have it?
    Mr. Wells. Yes.
    Chairman Ney. Okay, then we will request it.
    Mr. Melancon. It took awhile to clear it.
    Ms. Lee. Thank you, Mr. Chairman.
    Chairman Ney. Mr. Green.
    Mr. Green. Thank you very much, Mr. Chairman.
    Mr. Chairman, I must tell you that I marvel at how we can 
put a man on the moon, but we cannot put a trailer on a lot--
21,000 trailers in 30 days is not impossible for the richest 
country in the world. For some other countries, it could be 
impossible, but for this country, that is entirely doable. And 
I would hope that we would rethink our position on that and try 
to help this mayor and this city with those trailers in 30 
days.
    Mr. Wells, I know that you have broad shoulders, and I 
appreciate you very much. But I just want to share this with 
you because you are a fellow human being. The comment about the 
nine women in the room was not well thought through; it really 
was not. I do not think you meant to offend anyone. But that 
comment was not well received and I think that if you get a 
chance, you might want to let people know that you would not 
say it that way if you had another chance to say it.
    Mr. Wells. Let me just say, I apologize. That was not the 
intent to--
    Mr. Green. Thank you. I think you ought to salute him for 
his apology. I think you should.
    [Applause.]
    Mr. Wells. It was certainly not to meant to offend anybody.
    Mr. Green. I understand. I do believe you.
    Now we do have some contradictions that we have to 
confront. We want to rent apartment complexes, but we do not 
want to pay rent. And what I am saying to you is you gave us a 
clear indication, you made it conspicuously clear that you 
wanted to rent apartments--you want to lease apartment 
complexes, you want to do that. But we do not want to pay the 
rent at hotels. I call it rent. When I go to a hotel room, if I 
do not pay, then I have to leave. But we do not want to pay. We 
have had Federal judges to intercede and say that evacuees 
could stay longer than deadlines that had been imposed by FEMA.
    So FEMA is at a point now where you need to move from 
deadlines to life lines. People need to be given the 
opportunity to stay in place until there is another place to 
stay. It really is not rocket science. People have nowhere to 
go. And we cannot just terminate lease arrangements and expect 
people who are living in strange areas, many without 
transportation, many with children, some single parents, to 
just find a place to live. We have to be a little bit more 
compassionate than that.
    I can speak of Houston, Texas, specifically. There was an 
arrangement made with FEMA to allow the City of Houston to 
lease property with landlords and pay the landlord and get 
reimbursement from FEMA. That was the arrangement. Now not you, 
but FEMA has tried to find all kinds of clever ways to avoid 
that agreement. We actually had a person that appeared before 
our committee in Congress who said that while they wanted to 
terminate those leases, they did not want people to stay there 
for 12 months because they were 12-month leases. And by the 
way, many of those landlords would not have leased but for a 
12-month lease. He said that we are going to terminate those 
leases, but we are still honoring our agreement. The question 
was, how are you honoring your agreement if you are terminating 
the lease. He said, because we will pay any penalties that we 
have to pay. So that means we are honoring our agreement 
because we will pay the penalties. That is clever, but that is 
not helping people. You were not the person who said that, but 
I sat in the hearing when it was said.
    We sat in a hearing when Congresswoman Waters brought this 
same question up about this list. This is not the first time. 
And by the way, the person who was in Congress on that day, he 
left a few pounds lighter, too. I do not know whether he still 
has certain parts of his anatomy. But be that as it may, we 
keep repeating ourselves and making the same request.
    I really did not have a question for you. But I have a 
final comment and that is this, the City of New Orleans cannot 
resolve this by itself. This State cannot. The Federal 
Government cannot. But together, we can do this. This is not a 
big deal for the city, the State, and the Federal Government.
    Mr. Chairman, I yield back the balance of my time.
    Chairman Ney. Mr. Cleaver.
    Mr. Cleaver. Thank you, Mr. Chairman. Really one question, 
I guess, to Mr. St. Julien and to Mr. Williams. We had a chance 
to go to the Desire, the Hope 6 project. And I am familiar with 
Hope 6 and I spent part of my childhood in public housing. But 
Desire is one of the most beautiful projects I have ever seen. 
And I guess if we had 11.5 million more that came into the 
city, CDBG, what is the--do you have an idea what the annual 
CDBG allocation is?
    Mr. Williams. I beg your pardon.
    Mr. Cleaver. The annual. The 11.5 was on top of what the 
city receives annually.
    Mr. Williams. Eleven and one half billion is for the gulf 
coast and the allocation of that 11.5 billion would be based on 
the plans that the cities and the States present to HUD to 
utilize those CDBG funds.
    Mr. Cleaver. That will be competitive funding?
    Mr. Williams. Well, I do not think it is competitive. We 
have got a person who--I am sorry, did not get the microphone. 
We have a lady here who is with our CDBG department, our 
Community Development Department. Would it be okay if I asked 
her to answer that question.
    Mr. Cleaver. Absolutely.
    Ms. Farias. My name is Anna Maria Farias; I am the Deputy 
Assistant Secretary for Grants. And, yes, the $11.5 billion 
that Congress passed and the President signed on December 30, 
Secretary Jackson made it very clear shortly after we got back 
in January that we were to work very closely with the Governors 
of all five affected States so that they could start working on 
the waivers and their plans so that this $11.5 billion can be 
used once funds are allocated to the State of Louisiana through 
the Governor for low- and moderate-low income people.
    Mr. Cleaver. Okay.
    Ms. Farias. And also in addition you asked, New Orleans 
does get a certain amount, $70 million of CDBG, and it is up to 
the City of New Orleans to decide how they are going to use 
that money.
    Mr. Cleaver. Yes, thank you.
    Okay, the way CDBG normally works is that only certain 
class cities would go through the Governor in terms of 
competitive bidding. The major cities in this country do not 
get that allocation from the Governor. And I guess perhaps I am 
asking this inarticulately, but is New Orleans going to have to 
go out and compete with other Gulf Coast areas for a portion of 
the 11.5?
    Ms. Farias. New Orleans will have to go through the 
Governor of Louisiana to get a portion of the money because 
that is the way the supplemental bill--the Governor of 
Louisiana the money portion goes to the Governor. The Governor 
has appointed a Louisiana Recovery Authority and then the city 
administration.
    Mr. Cleaver. Yes, thank you. That was a mistake then. That 
was a big mistake. And I am familiar with CDBG, very familiar 
with it. It was intentionally designed to make sure that the 
larger areas ended up with an allocation based on disparity; 
you know the whole deal. And one of the reasons--is this going 
to be the Governor or is it going to be the Louisiana General 
Assembly?
    Ms. Farias. The monies are allocated to the Governor, but 
what the Governor has to do is they submit a plan to HUD, but 
they have to allow minimal participation to the citizens. And 
that means all the citizens of Louisiana, which of course 
includes the City of New Orleans.
    Mr. Cleaver. CDBG requires a public hearing.
    Ms. Farias. You have to have a public hearing.
    Mr. Cleaver. That is right; you have to have a public 
hearing. So we are going to have a statewide public hearing?
    Ms. Farias. The way the appropriation resolution was 
signed, that is the way it goes, sir. That is the way it was. 
The money goes to all five Governors of the five States.
    Mr. Cleaver. Do you see the problem? I mean, I know you 
cannot answer that question.
    [Laughter.]
    Mr. Cleaver. Mr. Williams, we are going to have a 
statewide--the CDBG regulations requires a hearing; you have to 
have it annually. And so with $11.5 billion going to Baton 
Rouge, we still have to have the public hearing except it is 
going to be a statewide hearing?
    Mr. Williams. The individual plans that are submitted are 
reviewed by HUD. And so HUD has oversight on those CDBG grants 
that are provided. So I know Secretary Jackson has expressed a 
very strong desire to be sure that there is equity in the 
allocation of those funds. And so the department will do those 
things that are necessary to oversee the equity within the 
distribution of the funds. The statute itself does limit 
allocations of funds to a certain percentage maximum to any one 
particular State. I believe it is 54 percent to any one 
particular State. So it does have some limitation within the 
statute itself. But also HUD has oversight and participation 
with the communities in being sure the funds are used 
appropriately and distributed appropriately.
    Mr. Cleaver. Mr. St. Julien.
    Chairman Ney. Time has expired, but if you would like to 
quickly answer.
    Mr. St. Julien. We need help; this is just an observation 
that you have, maybe not only because we have to do a statewide 
hearing for something that affects a large city like New 
Orleans, but we have a unique situation. Our people are spread 
out all over this country.
    Mr. Cleaver. That is the point.
    Mr. St. Julien. We spend a lot of money to get Iraqis who 
live in this country the right to vote for--in the last 
election in Iraq. And who were in Detroit and several other 
places and we need some mechanism and we need some funding to 
make sure we have public hearings in Houston, in Baton Rouge, 
in Memphis, in Atlanta so our people can participate and also 
participate in the vote.
    Mr. Cleaver. Mr. Chairman, I know my time is expired. I am 
a little familiar with this, maybe more than a little familiar 
with it. And it may have been our problem; it may have been our 
error. I can tell you right now as a former mayor having done 
these hearings for 20 years, this is a mess of major 
proportions and I think Mr. Williams and the kind lady in the 
back, they cannot agree with that because they might lose their 
jobs. But I know they can tell you it is a mess. And talk to 
them back in the back. It is a mess. It is going to be a mess.
    Thank you, Mr. Chairman, I am sorry I went over.
    Chairman Ney. Gentlelady from California, Ms. Watson.
    Ms. Watson. Thank you. I am sitting here and very 
diligently trying to pinpoint what the problem is. The first 
problem is beyond anything that you can do. And that is when we 
moved the Emergency Management Agency under Homeland Security. 
It just gives more levels to go through. And I heard you say, 
Mr. Wells, that it was protocol.
    The Emergency Management Agency should be just that. It 
should be able to move on a dime. It is not happening. The kind 
of devastation we saw today leaves you with the thought, what 
emergency has been addressed out here. We still saw trees 
uprooted and they are on roofs of houses and the houses are 
ready to collapse. And we saw rubbish in the streets; it has 
not been moved. There is nothing emergency about it yet.
    I heard very clearly--and you just happen to be the one 
that is here, Mr. Wells, very little you can do about this. But 
if I can pin down the stumbling block, that is with the 
contractors that did not go out to a competitive bid process. I 
heard you say one of the agencies, a private utility agency is 
bankrupt? How in the world can you get a Government contract 
and be bankrupt. Something is wrong in that and I wish there 
was someone here representing that entity. Can someone explain 
that to me?
    Mr. Wells. No, ma'am. They did not get a governmental 
contract. We gave--because they were bankrupt and did not do 
the things that needed to be done, FEMA hired a contractor to 
do Entergy's work that they normally do. So FEMA went into a 
contract with another company.
    Ms. Watson. Can you get rid of the contractors you have 
now? Apparently they are not delivering. And can you go out to 
a competitive bid in 30 days and find those that can deliver? I 
hear the mayor asking for 21,000 trailer units. That ought to 
be addressed. If the three companies that you mentioned cannot 
do the job, you need to contract with those who can. And you 
need to do it within the time span that you have given those 
who are staying in hotels and you are paying the rent--you need 
to do it so they can move out of those hotels, move on their 
property, rental property or leased property while you are 
trying to restore those neighborhoods. I think that can be done 
now.
    If you get the message from this committee hearing, I would 
go back immediately and say let us go to contract. Let us get 
people that can do the job and let us get the 21,000 units up. 
That would be a step one.
    Then you can look at other options too. If you can 
negotiate to get the apartments, that would be even better. If 
we can hook up all the areas that are without electricity and 
sewage disposal in the next few weeks, that would be a 
tremendous step towards returning the communities. Then if you 
could decide on who is going to take the rubbish away and where 
you are going to dump it, that would be another step that will 
really show progress. I was disappointed when I heard the 
President say there is progress and we went in the lower 9th 
ward and I do not see it. I am just here one day. But I do not 
see the progress. And I am wondering where the Emergency 
Management Agency is.
    But I think that you have indicated to us what the problems 
are. You have so much bureaucracy, you know, on top of what you 
do that you cannot get anything done in a timely fashion.
    So one of the problems would be for us to do oversight and 
remove the Emergency Management Agency from Homeland Security. 
We cannot secure the land if we cannot secure the people on the 
land. And we are spending billions of dollars 10 and 11 
thousand miles away trying to secure people in Iraq and we 
cannot even help the Americans that are crying for just a place 
to stay outside of a hotel. So if we can solve the problem of 
the contractors and get them to deliver what we are paying them 
for--and you need to find out, I am sure there are people in 
this crowd here that can help hook up a trailer. We were sent 
up a letter from Jira Business Services, Incorporated to a Mr. 
Best. And they were going for a contract, but they were stalled 
and stymied, so that inside-boy trading does not work when you 
are really addressing this kind of emergency. We have got to 
put a new face on this. America has to become concerned about 
Americans as well.
    Chairman Ney. Time has expired.
    Ms. Watson. So if you can take my suggestion that we find 
new contractors, get rid of those that cannot do the work. You 
know, just break that contract and go with those that can.
    Thank you, I yield back my time.
    Chairman Ney. The gentleman from Louisiana, Congressman 
Melancon.
    Mr. Melancon. Thank you, Mr. Chairman, I appreciate it.
    You know, we are questioning probably the wrong people. The 
problem is coming from the top. I sit on the Katrina Committee 
and not very long ago we put on record a letter about trailers 
and about the program. And it went as far up and was seen by 
the Vice President that basically said that the trailer idea is 
worse than originally thought. Per the data provided, the last 
batch of trailers that we are now purchasing will be coming off 
the production line in approximately 3.5 years. And Mr. 
Chairman, if I can enter that into the record, if you do not 
mind.
    Chairman Ney. Without objection.
    Mr. Melancon. FEMA was dismantled, in the sense that it is 
underfunded, understaffed, and incapable, not because Mr. Wells 
does not try to do his job. There was requested of the 
leadership that there be an independent Katrina Commission, 
just like the 9-11 Commission, to find out what really are the 
problems and to address them. It would not take care of the 
needs of Chalmette and Belle Chasse and Venice and New Orleans. 
But at least it might prevent us in the future from having a 
disaster that is worse than the disaster that we have already 
suffered.
    I would hope--and Chairman Ney, again, I thank you for your 
interest and your concern. We have got committees scattered all 
over the House and the Senate and one hand does not know what 
the other hand is doing because the information is not all 
readily available. And the only thing that I would like to ask 
is that the leader of the House and the leader of the Senate 
join with the minority leaders and ask for an independent 
commission and that the President, as I requested yesterday, 
use whatever executive powers and authorities he has to waive 
those rules and regulations that hamper people like Mr. Wells 
and the people from HUD from getting the job done 
expeditiously.
    It is going to be a long toil; I think we all know that. 
And there is nothing that we can say here today that is going 
to make it easier on any of us. But I know the people of 
Louisiana and I have all the faith in the world of their 
resilience. We can get this State and this Gulf Coast back up 
to what it used to be. It is going to take time and, again, we 
are not asking for a handout, only a hand up.
    So Mr. Chairman, thank you for everything that you have 
done to bring us to New Orleans and to Biloxi to try to open 
this door so that these people can see in and understand what 
the real problems are.
    And I yield back my time.
    Chairman Ney. I thank the gentleman. Mr. Taylor.
    Mr. Taylor. Thank you, Mr. Chairman.
    A couple of things, Mr. Williams. My question to you is 
based on your written testimony on pages five and six. You are 
talking about a program to advance mortgage payments to people 
for up to 12 months, you know, while they may have been out of 
work in order to try to rebuild their houses and stay in their 
houses. My question is, is that solely for FHA guaranteed 
loans?
    Mr. Williams. We only have the ability to do it on those 
that are FHA insured.
    Mr. Taylor. Do you have any idea out of all the mortgages 
out there, what percentage of them would be FHA?
    Mr. Williams. The Gulf Coast area, it is about 20 percent.
    Mr. Taylor. Okay. Mr. Wells, a couple of observations based 
on what I have seen in Mississippi, you all are just getting 
started here. But please do not repeat the same mistakes.
    We have about 30,000 trailers out in Mississippi. We have 
over 20,000 quality complaints. I have been to your staging 
area in Purvis where we actually as a Nation take control of 
these trailers, the manufacturer delivers them as far as 
Purvis, Mississippi. Once they come in that yard, they become 
Government property. At the Purvis yard, a FEMA rep will walk 
in and turn on the 12 volt lights. He will turn on the gas and 
hook it up to a pressure gauge. But he does not check the 
plumbing; he does not check the microwave, for example put a 
cup in the to see if the microwave is working and warms it up. 
He does not listen to see if the refrigerator is working. He 
does not turn on the air conditioner to see if it is working. 
So what he is not checking on this approximately $19,000 
purchase by our Nation is pretty alarming because once it 
crosses that yard, if the refrigerator goes out, the air 
conditioner goes out, et cetera, et cetera, it becomes the 
Government's responsibility to pay for it. We have to send--
instead of doing it all in one place where you can have your 
crews in one place, we have got to send crews all over south 
Mississippi to fix it. So the person getting the trailer is 
disappointed and angry. A great expense to the Nation to fix 
these things. We need to do a better job upon delivery of 
making sure we are getting a quality product.
    Second thing, snuck on the Bechtel lot, I was told that I 
could go any time I wanted. I went, did not ask permission, and 
found 50 trailers where they had taken the thermostat out of 
this one to fix that one. They had taken the microwave out of 
this one to fix another one, taken the air conditioner out of 
this one, leaving a hole in the roof so every time it rained, 
water came in and ruined the trailer, pulled the window out of 
this one to fix that one. And again, do the quick math, 50 
trailers, approximately $20,000 apiece, that is a million 
dollars worth of junk instead of 50 homes for people. And I 
have not had an adequate answer as to who is going to pay for 
that. But the citizens should not pay for that mistake that is 
being made on Bechtel's leased property.
    [Applause.]
    Mr. Taylor. Okay? And again, I say all these things because 
this is not the last natural disaster. We are getting close to 
being there in Mississippi, but we are all United States 
Congress people; we are all responsible to the citizens. We do 
not want to see that money wasted; we do not want to see those 
resources wasted. And we want to make sure if we are going to 
help people, let us do it in a timely manner and let us do it 
quickly.
    Third thing, and this in the form of a question. I am not 
going to name names. But there were 50 that had be 
cannibalized, so that is 50 that were ruined in order to fix a 
few. But there were about 250 that had been returned and if you 
walk up on the front they take and mark what was wrong with 
them. And about 90 percent of them by my count were one 
manufacturer, without naming names. My question is--and I think 
that we are buying four of five different manufacturers--is 
anyone at FEMA telling anyone up the line quit buying this junk 
or get those guys to straighten up their act? Because that is 
250 trailers that people could be occupying tonight that, 
because of quality defects, are sitting in the yard over on 
Menge Avenue. Unfortunately the committee does not have time to 
see Menge Avenue, Pass Christian, Mississippi.
    So, again, since you are just at the initial stages, what 
steps are you all going to take here so that that mistake is 
not repeated? And what steps are being taken throughout the 
FEMA organization to keep these mistakes from being made again? 
Because we do not want to keep making the mistakes every single 
time we have a natural disaster in this country. You all need 
to do better. The Nation needs to do better and if this 
committee needs to pass legislation, tell us. We have got to do 
better than you all did in Mississippi.
    I am grateful for the 30,000 trailers that have been 
delivered; it could have been done a lot quicker. But my point 
is if you pay anyone by the hour, it is just natural that they 
are going to work slower. If you pay them a percentage above 
their mistakes and for the mistakes, they are going to continue 
to make mistakes and you are going to keep paying. That 
contractor needs to be paid by the job. A successful delivery 
of a working trailer, because it is amazing how fast people can 
work when you pay them piece work. And we know that from the 
debris removal, because yes, it was too expensive, but they 
were paid by the cubic yard, so they got out there and hustled 
and picked up all the debris that they could because every time 
they showed up with a yard of debris they got paid for it.
    Chairman Ney. Time has expired.
    Mr. Taylor. The same attitude we ought to be taking with 
the trailers.
    Chairman Ney. I just--I have not asked questions because I 
wanted to yield to other members. I will be very quick because 
I know we have got a very patient second panel. How many 
trailers have you put in Louisiana total, how many trailers?
    Mr. Wells. Around 26-27,000 travel trailers and mobile 
homes.
    Chairman Ney. 26,000, okay, have been placed or on the 
ground in Louisiana?
    Mr. Wells. That is families moved in.
    Chairman Ney. Families moved in, okay. How many are here 
then in New Orleans of the 26? If you can follow up.
    Mr. Wells. I can give you a general idea.
    Chairman Ney. A general idea and then later on if we can 
get the information by parish?
    Mr. Wells. We have it by parish. It is probably around 1800 
for Orleans. I think for Plaquemines it is probably around 1400 
and probably around 900-1000 for St. Bernard, the three hardest 
hit parishes.
    Chairman Ney. One thing I might suggest, committee members, 
we do not have to do it formal because it would take forever 
and a day, but maybe GAO, we could call informally in a sense, 
not a 9-year study, but could do a quick 2 or 3 days to find 
out, you know, what is the short circuit of how many were 
ordered and how many--because I know again, the Department at 
one time wanted a lot of them, and how you get them on the 
ground. In other words, study--not a study--a GAO opinion how 
to make this work, how to make 21,000 work in a month. How to-- 
maybe--I am just throwing that out there.
    Mr. Wells. Okay, chairman, I have got--
    Chairman Ney. Somebody has got to make it work somehow.
    Mr. Wells. Okay, Plaquemines, this is occupied 1113; St. 
Bernard occupied, 1315 and in Orleans, 2196.
    Chairman Ney. Okay. And what is the projected need in New 
Orleans, how many more?
    Mr. Wells. We met with the Governor--there are different 
ways of looking at this. He had 8000 sites; we are talking 
about like group sites already identified that they are 
somewhere from breaking ground to somewhere in the process of 
establishing group sites for 8000 units. In addition to that, 
there are about 7000 more group sites that the mayor needed to 
find space for.
    Chairman Ney. Okay, I have a quick question on the housing 
complex we went to today, Lafitte, I believe it was, Lafitte--
for anyone that wants to answer it. When we were in there and 
again, you have to be here. We have seen it on TV; we worked 
with this issue--you have to be here to see it and I wish 
everybody involved with the votes would come down here.
    But we were in there today and the mold just went up the 
walls and things like that. It was built in the 1940s; I did 
not know that. I thought it was the 1960s, but it was built in 
the 1940s. Who decides--because so many families are affected, 
I think 890 some families are in Lafitte. Who makes the 
decision to say okay, this is how much it is going to cost to 
redo it, clean it up, redo it and this is how many months it 
will take or this is how much it cost to rip it all down, build 
new and this is how many months it will take? Who makes that 
decision?
    Mr. Williams. Mr. Chairman, we are glad you are here too 
because it is hard to kind of understand what that is without 
being here. Mr. Osadeck is the expert on the public housing and 
if you do not mind, I could ask him to answer your question.
    Chairman Ney. We saw Hope 6 today, and I supported the 
ranking member and other members, both sides. Ranking Member 
Barney Frank and Mr. Oxley were active in it. We all supported 
keeping Hope 6 alive. You know, we went reverse with the 
recommendation and we kept Hope 6 alive. The Hope 6 site I saw 
today, I do not know how on earth you could do anything but rip 
it down. I mean, but with this apartment or with these units 
there is a second floor. So I think it is an important question 
because the sooner that decision is made the quicker the people 
can get back into the public housing.
    Mr. Osadeck. Thank you, Mr. Chairman. The housing 
authority--you met Dr. Moon today.
    Chairman Ney. Yes.
    Mr. Osadeck. Who was on the bus, as well Dr. Jarvis, are in 
charge of doing that assessment. They have hired outside 
contractors as well as staff who are able to come back to New 
Orleans to assist in both the clean up and the assessment. As 
you can imagine, there is a lot that goes into deciding whether 
or not to try to rehab these units or to request the department 
to tear them down and either start over again with new units, 
do some sort of mixed finance, mixed income redevelopment, or 
request of the Department vouchers for replacing the units 
lost.
    Chairman Ney. Also on these housing units for people that 
need housing assistance, is it automatic that wherever the 
units were before, housing complexes, is that what will be back 
there again? Or is that something that is going to be a 
dispute? I am not talking necessarily just about HUD, but also 
locally or in this State or is that an automatic, that where it 
was it will be again?
    Mr. Osadeck. I can only speak for public housing. Where the 
housing authority actually owns the real estate, there are no 
incumbrance to putting units back on that site. The local codes 
would be the only thing that would need to be complied with at 
that point--densities, heights, those sorts of local code 
issues. And you may also know that the housing authority has 
actually begun to allow some people back into the public 
housing units. I think the guiding principle here is that units 
have to be safe, decent, sanitary.
    Chairman Ney. Not into Lafitte.
    Mr. Osadeck. Well, you saw today. Those things are clean on 
the outside. That site has been cleaned by the authority to the 
extent that it could and those units were secured so that 
nobody can break in and hurt themselves or steal or any other 
thing that can go on there. You have seen how those have been 
secured while the assessment goes on as to what should happen 
with them.
    Chairman Ney. Also on sites where you would build public 
housing, is anybody looking at the levels of toxic materials so 
that it is cleaned up for people, that it would be safe for 
kids and families?
    Mr. Osadeck. Indeed, chairman, that will be one of the 
things that the housing authority and the department will have 
to be very careful to ensure that before allowing people back 
into these units, they are indeed safe.
    Chairman Ney. And I am going to close with this because we 
have got the second panel. I also want to note that some 
members may have additional questions for this panel and they 
might want to submit it in writing. As usual House procedure, 
without objection, the hearing record will remain open for 30 
days from this hearing for members to submit written questions 
to these witnesses and to place responses in the record.
    I just want to end with, first of all, thank all of you for 
being here. Again this is the first panel; we have a second 
one, but our committee members too for being here. I mean, it 
is important. Before we came here, there are a lot of people 
that have watched this, one of the worst situations in the 
history of the country and so it is very, very important that 
we react. And it is tough with something of this catastrophic 
nature and people going in every direction. But the big goal is 
to work together.
    I have to say one thing. I wrote a letter to the Army 
Corps. What I want to say is this. I mean, somebody has to make 
a decision on that levee and what it is going to rebuilt to and 
that has to be--I do not know if it has been done. It is not 
your jurisdiction. But I am just saying, I say this everywhere, 
it has got to be done. Because as we are trying to help and 
there is precedents that have been set with this situation. We 
have had floods where I live and precedents set and that is 
okay, because there are some catastrophe things. But if that 
levee is not decided, here it is, it is a level five, I can 
tell you if this happens again and that levee is not sustained, 
you will get people arguing whether frankly people should be 
helped or not and that is an argument we do not need in this 
country. So I am hoping, I do not know, Congress, whatever we 
can do, or the Administration, somebody has got to make that 
decision and I think it is an important one.
    But I thank all of you for your time; thank you.
    And we will call the second panel. Second panel--Ms. Elise 
Boyer, Dr. Willie Gable, Mr. Darrius Gray, Ms. Martha Kegel, 
James Kelly, Muriel Lewis, Kevin Mercadel, I am sorry if I am 
not pronouncing these right, Randy Noel, James Perry, Larry 
Schedler, and Ms. Pauline Stewart. And we will take a quick 5 
minute recess.
    [Recess.]
    Chairman Ney. The Committee will come to order. We have the 
second panel and I want to--the committee will come to order, 
if the members could please come to the table.
    [Pause.]
    Chairman Ney. Okay, the committee will come to order. And I 
want to thank you again, the second panel, for having the 
patience. We are going to start with Pauline Stewart, who is a 
resident, currently residing in a hotel. Ms. Stewart, thank you 
for coming today and I am sorry for what has happened to you 
and so many people down in the Gulf States here.

STATEMENT OF PAULINE STEWART, RESIDENT (CURRENTLY RESIDING IN A 
                             HOTEL)

    Ms. Stewart. Thank you for having me.
    Chairman Ney. If somebody could push the microphone a 
little closer.
    Ms. Stewart. My address in New Orleans is 5700 Louis Prima 
Court; that would be Orleans Parish, the 9th Ward, New Orleans 
East.
    My problem with FEMA that I am here to address today, is 
their rental program. I have had FEMA refer in a 2-day period 
during the month of December five apartments; one in Metairie, 
one in Kenner, three in Baton Rouge. I am presently staying in 
a hotel in Baton Rouge. Each referral needed credit check, a 
criminal background check, and income in the amount of three, 
three and a half times, and four times the amount of the 
monthly rent. As Katrina victims, most Katrina victims not only 
lost their homes, they also lost their jobs. Most are on 
unemployment. They have no income by which to qualify for an 
apartment.
    In addition, FEMA will not tell you how long they will pay 
rent. So you cannot tell a landlord how long you will be able 
to sign a lease. I have addressed this question as far as I can 
get it, all the way up to Congress, my Representative, my 
Congressional Representative. I have no answer as to why the 
FEMA rental program in Louisiana is ineffective.
    We have also approached FEMA for trailers and I have been 
told that because my family only has two, two members, we can 
only qualify for a travel trailer.
    Chairman Ney. I am sorry. What two, who is the second 
person in the family?
    Ms. Stewart. My daughter evacuated me out of New Orleans. 
Okay, so she is with me temporarily.
    Chairman Ney. Okay, thank you.
    Ms. Stewart. Okay, and I could request a mobile home, but 
the odds were that I would not get one. And I cannot request 
where I would like this travel trailer. It could be as far as 
Shreveport. I am here today because I want to move back home. 
And I cannot move back home if I am living in Shreveport. I 
cannot rebuild my home if I am living anywhere in north 
Louisiana. I told FEMA that I need to be as close to New 
Orleans as possible and that may not happen.
    Now after FEMA could not provide me with answers or help or 
assistance with their rental program, I went to HUD. And HUD 
has advised me multiple times, because I have called them 
multiple times, because I have been given so many numbers--I 
have called them multiple times and each time I was advised 
that if I was not on a HUD program on the date of Katrina, I 
was not eligible to participate in any of their programs now. 
And asking further why that was so, I was told that HUD did not 
request additional disaster monies, because they were working 
off their existing budget.
    So that is where I am now, okay. I am waiting; I have to 
apply for an extension to stay in the hotel until maybe 
February 7th or February 13th. I would prefer an apartment as 
opposed to a travel trailer and I do not know what is going to 
happen. I have lost total control of my situation because I 
have to rely upon FEMA.
    At some point in time, yes, apartments are very scarce but 
within 2 days that young lady that was hired by FEMA did refer 
five apartments to me. Apartments are there; FEMA has hired 
people to find them. They may not be in the greatest of 
quantity, but they are existing.
    And that is all I have to say, so if you all have 
questions, I would be happy to answer any that I can.
    Chairman Ney. Ms. Boyer. Thank you.
    [The statement of Pauline Stewart can be found on page 169 
in the appendix.]

     STATEMENT OF ELISE BOYER, RESIDENT (RESIDING IN HOTEL)

    Ms. Boyer. I am a victim of Katrina and Rita. I do live in 
New Orleans and I am still in New Orleans. I had to leave New 
Orleans the day of the storm to go to Florida. Went to Florida, 
my home is here, so I had to travel back from Florida here. I 
have been living in a hotel ever since then and that has been 
about 4 months. The hotel is fine; it is some place for you to 
lay your head; you are not in the street. But stipulations, you 
have to--first it was every 7 days you have to go and apply for 
an extension. Now, it is every 3 days you have to go and apply 
for an extension. Add to that, you have to have a code in order 
for you to get an extension. So that means if your code is not 
in, your hotel room is rented. That is where we are now.
    So my house I could not live in it. I had six feet of 
water; we cleaned out all the water and all the junk and 
everything that was in it. I had to have my house rewired. Did 
that. After that, there is no one in the neighborhood; there is 
no gas; nobody is in the neighborhood but me. I go and check 
the neighborhood out and check the house and see how everything 
is. They have been breaking in, because the doors are open. You 
cannot lock them because of the Corps of Engineers or whatever 
broke the locks on the doors and they left them like that; they 
left them open. So you have to buy locks; you have to watch 
your houses.
    The hotel is fine, but it is no place like home. And I 
really want to go home. I am home, but I am not in my house. I 
live in the Broadmoor area--devastation. Everybody's house is 
washed away; it is a disaster. We have no neighbors; 
everybody's gone. They come back, gut their house out, and they 
go back. So that is where we are, trying to get in my house, 
but Entergy has not, the gas is not ready. We still have water 
in the gas. So we do not know when that is going to happen.
    So I am hoping and praying that our extensions will be long 
enough for us to live where we can get our houses repaired and 
get back in them before they throw us out in the streets.
    I thank you all and that is all I have to say. If you have 
any questions, I will be willing to answer them.
    Chairman Ney. Thank you, and I want to thank you as I did 
Ms. Stewart.
    I am sorry for what has happened to you and so many people 
down here. Our thoughts are with you. Our hearts are with you. 
But we are here with you now to hopefully do as much as we can 
do to make sure you have some type of place to live here at 
home.
    I thought what we would do, because both witnesses have to 
travel back to Baton Rouge, so I know we normally go, you know, 
5 minutes each. Why do we not see if we have any questions of 
either of the witnesses and then we will go on to everybody 
else.
    One question I had, how do you get notification about when 
you would have to leave? I mean, I am sure you viewed in the 
newspapers that there was a certain deadline. Did you get any 
physical notification?
    Ms. Stewart. The official notification that I received came 
from FEMA to the hotel. I am sorry; it was given to me by the 
hotel, okay. And it was a notice that we had to be out; I think 
this was December 15th, and there was of course that extension 
that was granted at the last minute. And the attorneys that 
were involved were out of New York that went to the judge to 
get the extension.
    So I called FEMA to get an update on what is going on 
because now everything is different for everybody; the dates 
are all different. So I have to explain my situation and what 
category I fall in and that is the extension that would be 
applicable to me. So we have to request authorization numbers 
from FEMA before the end of this month, January, and they will 
give you maybe a week extension with that authorization.
    Chairman Ney. And that is the same experience, Ms. Boyer, 
that you have too?
    Ms. Boyer. We do not know how long the extension will be.
    Chairman Ney. One other final question that I have and then 
we will move on to members. Where you are living; what about 
cooking? Do you have a kitchenette?
    Ms. Boyer. No kitchen.
    Chairman Ney. So you get your meals by eating out.
    Ms. Boyer. Out of the truck. We have a Salvation Army 
truck, Red Cross truck.
    Chairman Ney. What about your evening, if I could just 
probe a little farther. What about your evening meals, do you 
have a hot evening meal?
    Ms. Boyer. If you have the money, you have to buy it.
    Chairman Ney. You have to buy it.
    Ms. Boyer. Other than that, yeah. Other than that, you eat 
sandwiches.
    Chairman Ney. Look, everybody knows this. If you eat out 
all the time--you cannot.
    Ms. Boyer. You cannot, you do not have the money. 
Everything is so high.
    Chairman Ney. Unless you have an awful lot of money.
    Ms. Boyer. Right.
    Chairman Ney. Obviously you do what everybody does; you buy 
groceries and you cook, you know, at home. So you would have to 
pay out of your pocket unless you can get--is the Salvation 
Army food free; is that okay?
    Ms. Boyer. They give you free lunch.
    Chairman Ney. I assumed they would. Otherwise though, but 
three meals a day, is it the same situation.
    Ms. Boyer. One meal.
    Chairman Ney. Okay, you do not have, okay, let me ask you 
this. Is there a mini refrigerator in there where you can have 
milk or juice or snacks?
    Ms. Boyer. We have an ice bucket and that is how you keep 
your juice or water, you know. You cannot put too much in an 
ice bucket, maybe one bottle.
    Chairman Ney. And that is very difficult for both of you. 
If you had children, I do not know what--or medicine that you 
have to refrigerate. Okay, that is something that I have not 
heard before.
    Our ranking member.
    Ms. Waters. Just quickly, I want to understand the re-
authorization process as you are describing it. You mentioned 
that you have to do something every 3 days. What is that?
    Ms. Boyer. You have to call FEMA. You have to go down and 
register.
    Ms. Waters. Go down where?
    Ms. Boyer. In the hotel.
    Ms. Waters.  In the hotel and register at the desk?
    Ms. Boyer. And register at the desk for your extension.
    Ms. Waters. And what happens when you do that? Do you have 
to answer questions or what?
    Ms. Boyer. No, you can just tell them that you came for the 
extension and sign up for the extension and you just stay there 
until another extension comes and you have to go back. It used 
to be 7 days now it is 3 days.
    Ms. Waters. And you said something about if you did not do 
something your room could be rented out? What is that 
something?
    Ms. Boyer. Yes, you have to get a code.
    Ms. Waters. A code.
    Ms. Boyer. This is something new that FEMA has put on us.
    Ms. Waters. Now who gives you the code, the hotel?
    Ms. Boyer. Yeah, FEMA issues the code and you have to give 
this code to the hotel. That is for you to get another 
extension. Now my extension will be until February 13th; you 
have to go down 3 days before.
    Ms. Waters. Before February 13th. And the last time that 
you went to get your extension, did they ask you any particular 
questions?
    Ms. Boyer. No.
    Ms. Waters. They did not. And as you understand it, when 
you go back on February 13th, it should be basically the way it 
has been in the past where they just reissue a code to you. Did 
anybody talk to you about having a plan of any kind about how 
you are going to deal with your life if you did not have access 
to a hotel?
    Ms. Boyer. No.
    Ms. Waters. Thank you. Thank you. You mentioned--did 
anybody tell you what the criteria was for getting a mobile 
home as opposed to a travel trailer?
    Ms. Stewart. It has to be more than two people. They gave 
me as an example a family of five, they would put into a mobile 
home.
    Ms. Waters. Okay, and then what did you tell me about why 
you have not got a travel trailer?
    Ms. Stewart. I do not know the reason why I have not gotten 
one.
    Ms. Waters. You told them that you wanted one and they know 
that you need one and nobody has said we have one in 10 days or 
15 days or--
    Ms. Stewart. No.
    Ms. Waters. Thank you very much. I am sorry; Mr. Ney had to 
step out for a moment.
    Ms. Lee, I will just go to you.
    Ms. Lee. Let me first say, thank you very much for being 
here today and as I said earlier I just marvel at the spirit 
and the determination and the resilience of the people of New 
Orleans and just know that you will rebuild this great city. 
But I know that we have a responsibility to help you in those 
efforts.
    Just a couple of things I would like to ask, and you heard 
earlier FEMA and HUD, and I wanted to find out in terms of 
those individuals who have been displaced and who are living 
around the country, do any of you have an idea of how they are 
doing? I mean, we have people in all our districts we know and 
who we are helping; 90 percent of them, 95 percent of them want 
to come home. But there is so much confusion and so much in 
terms of lack of communication and lack of information with 
regard to when, where, and how, and what is taking place here. 
So I would just like to ask any of you if you know how--what 
system is established to make sure that relatives, family 
members, friends are in contact with those who are still here 
in the region, so they can make this transition back as quickly 
as possible?
    And secondly, I just wanted to ask you about some of the 
trauma again that has been associated with this disaster and 
just how you see people faring in terms of their mental health 
needs and what it is you think needs to be done within the 
context of helping them come home with their housing, and so 
anyone could respond to that. Mr. Kelly.
    Mr. Kelly. I have spent a number of hours this week with 
trauma counselors who worked in the tsunami, who have worked in 
9-11, et cetera. What we are now talking about is the number of 
suicides. The mayor made some reference to it, the mental 
health of our people. If you go through trauma, if any of you 
go through grief, what do you do? You go home and you curl up 
in bed or you curl up with family. Our folks do not have any 
place to go to deal with their trauma. We are going to have 
post-traumatic stress syndrome like you have never seen before 
in any nation.
    For the majority of our people, their home is what they 
have been striving for. Their home is gone; we are going to 
have post-traumatic stress syndrome that affects rich and poor. 
But I will tell you who is going to deal better with it, the 
poor because they are stronger and because they have been 
through lots more grief. But the number of suicides, the number 
of elderly who have passed on way before they should have--just 
open our obituary pages, elderly after elderly after elderly; 
we are losing our elderly. We are also seeing our elderly age 
faster than they have ever aged before.
    We are going to see post-traumatic syndrome with children. 
I know I have sat and played with children in shelters in Baton 
Rouge who have spent 2 to 3 months of their lives, a 1-year-old 
who spent 25 percent of his life in shelter. Do you not think 
that is not going to affect these children.
    There is a difference between grief and trauma is what I 
have come to learn. Trauma lasts a long time.
    Chairman Ney. Any questions for the two witnesses.
    Ms. Watson. Yes.
    Chairman Ney. I am sorry; Mr. Green is next.
    Mr. Green. Thank you, Mr. Chairman; I will be brief. I 
really appreciate having you up here before us today because 
there are many people who actually think that you have the good 
life. You are living in a hotel, maid service, room service; 
they do not understand what your life is really like. So you 
really have given me the ammunition that I need to speak on 
your behalf.
    But for clarity, I assume that you do not have maid service 
in the room. Tell me if you would, Ms. Boyer, and I will just 
let this be my only question. How are you managing with getting 
your things cleaned and that sort of thing?
    Ms. Boyer. Well, we have to go to the washeteria and that 
is very expensive, a dollar and a half for about 45 minutes. To 
dry your clothes, that is 75 cents. What do you get? About 15 
minutes. It is very expensive living in a hotel.
    Mr. Green. God bless you. Thank you very much.
    Mr. Chairman, I yield back.
    Chairman Ney. Mr. Cleaver.
    Mr. Cleaver. Thank you, Mr. Chairman, I have no questions. 
I appreciate very much you coming and I yield back the balance 
of my time.
    Chairman Ney. Ms. Watson.
    Ms. Watson. Just for clarification as well. Ms. Stewart and 
Ms. Boyer, every 3 days, is this the same with you, every 3 
days you have to register? Is there anyone who intercedes for 
you and lays out the procedures or do you have to initiate a 
call to FEMA?
    Ms. Stewart. The authorization code comes from FEMA. 
Without that authorization code from FEMA, you are not going to 
get your hotel.
    Ms. Watson. Do you get through on the line your first 
attempt?
    Ms. Stewart. It is no problem reaching them. You know, that 
situation is over; they have enough people now and people have 
settled basically. The urgency is not there as it was before.
    Ms. Watson. Now you mentioned that you wanted to get a 
trailer and that you were not eligible for a certain kind of 
trailer?
    Ms. Stewart. The mobile home.
    Ms. Watson. The mobile home. Only what kind of trailer?
    Ms. Stewart. A travel trailer.
    Ms. Watson. A travel trailer. And what is in a travel 
trailer?
    Ms. Stewart. It basically has the same thing as a mobile 
home except it is quite small.
    Ms. Watson. Quite small.
    Ms. Stewart. It is a recreational type thing you go on 
vacation with. You see people driving along the highway; they 
are very small. I mean, it would be basically the equivalent of 
being in a hotel room for another 4 to 6 months or a year.
    Ms. Watson. I see. Ms. Boyer, you asked for a trailer on 
your property?
    Ms. Boyer. Yes, I did.
    Ms. Watson. And what is the problem you are facing?
    Ms. Boyer. They told me my driveway was too small, four 
inches, my driveway. The trailer would be on my neighbor's 
property four inches. I cannot recall how many feet my driveway 
have, but my driveway is the length of my house. I have a 
driveway on both sides and I also have a carport in the back. 
No reason why my carport, my driveway will not hold a trailer 
because I see trailers hanging off the sidewalks. I see 
trailers on the sidewalk in front of houses. Mine would be in 
the driveway. The house next to me is vacant. It is vacant 
because those people have not come back, not even to take a 
refrigerator out. I said to her, would you mind if it is over 
there four inches? She said, you know I do not mind, put your 
trailer up there. I have not heard anything. I was in Florida 
when I applied for the trailer. I did not talk to anybody; they 
talked to my daughter on the phone and told her my driveway was 
too small; I would be four inches on my neighbor's property.
    Ms. Watson. Thank you.
    Mr. Kelly, you mentioned working with the children in the 
shelter. How many--do you know how many children are still 
disconnected from their families and in shelters?
    Mr. Kelly. Most of the shelters, almost all the shelters 
are closed. But it is just a different type of shelter. We put 
families without jobs, without cars, without childcare in 
trailer parks--it is just a different method of a shelter--or 
we put them in hotels without any resources. It is just a 
different type of shelter, in my mind.
    Ms. Watson. Let me direct to the chairman and the ranking 
member, is this session being recorded?
    Chairman Ney. We have a transcriber.
    Ms. Watson. Okay, I was wondering if we could take some of 
these points and put them in a report directly to FEMA or any 
other authority.
    Chairman Ney. We have the transcriber.
    Ms. Watson. All of the points that they are making. You 
know, the property line, is that really relevant in an 
emergency. These are the kinds of ridiculous things that make 
this agency not one that addresses in an urgent way. And so I 
would like to--ranking member, I would like to have these 
pointed up in any report that comes out of this meeting, these 
ridiculous regulations that are making it difficult for the 
evacuees to at least come back to their property.
    Chairman Ney. Without objection. When it is transcribed, we 
will take the information and as a committee, we will send it 
to FEMA.
    Ms. Watson. Thank you. I yield back.
    Chairman Ney. Any other questions of the two witnesses? And 
we will move on. I have just got to say to both of you again it 
is a terrible thing that has happened and I do not know how you 
are doing it. You have also shed some light frankly that 
nobody, and you might think that everybody talks to everybody, 
but you shed some light that I have not thought of. I knew it; 
it is not a condition that people want to be in. But all I ever 
heard that people are getting traumatized because at first they 
were going to be out in December and they are going to be out, 
and that is one of the reasons that we are here. But nobody has 
pointed out some of the other things. I mean, I can go on with 
a ton of questions. Vacuum cleaners, is a vacuum cleaner 
provided for you or do you have to go out and get your own 
cleaning supplies. I mean, I can go on and on and on about 
money that you obviously do not have. And I just--is there any 
type of payment that FEMA gives or the Government, the United 
States Government is giving?
    Ms. Boyer. At the beginning they did.
    Chairman Ney. They did. Okay, and when did that stop?
    Ms. Boyer. Right after they gave it to us. The same, when 
they gave me that money.
    Chairman Ney. One time payment.
    Ms. Boyer. They gave me $2000 the first time.
    Chairman Ney. Okay, that $2000. Well I want to again thank 
both of you and we will just start down here. Mr. Gray, we will 
go right down the line.

STATEMENT OF DARRIUS GRAY, PRESIDENT, GREATER NEW ORLEANS HOTEL 
                     & LODGING ASSOCIATION

    Mr. Gray. Thank you. Would you be so kind and slide the mic 
down; Thank you so much, appreciate it.
    Good evening. Speaking on behalf of the American Hotel & 
Lodging Association, I appreciate the opportunity to testify 
before the Subcommittee on Housing and Community Opportunity 
for the Committee on House Financial Services. The American 
Hotel & Lodging Association is a 96-year-old dual membership 
association of State and city partner lodging associations 
throughout the United States with some 10,000 members 
nationwide representing more than 1.3 million guest rooms.
    American Hotel & Lodging Association and the lodging 
industry understands the enormity of the unprecedented 
devastation caused by Hurricanes Katrina and Rita. Many of our 
own employees were displaced; many of our businesses were 
partially damaged; some completely destroyed. And our industry 
faces a long road back to normalcy in the region which will 
take years to recover from. American Hotel & Lodging 
Association well understands the extraordinary demands placed 
on FEMA due to these hurricanes and applauds its many 
successes. However, improvements must be implemented if our 
Nation is to better respond to future events.
    Having said that, I want to bring to your attention the 
involvement of the lodging industry in the months after the 
tragedy of Hurricane Katrina and the past and present concerns 
we have compiled on behalf of the industry. In the chaotic week 
following the hurricane, American Hotel & Lodging Association 
was asked by the Department of Homeland Security to secure 
250,000 guest rooms in case they were needed for a proposed 
housing plan in which the room blocks would be leased by the 
Federal Emergency Management Agency for a period of no less 
than 6 months but could extend as long as 18 months.
    American Hotel & Lodging Association disseminated the 
message to our members immediately and within periods of 6 
weeks we had collected well over 190,000 guest rooms. The 
tremendous response from hoteliers across the country is a 
testament to the passion and generosity that our industry 
showed toward this event. Over 4500 properties had applied to 
participate, willing to lease large blocks of rooms, in some 
cases the entire hotels to FEMA to house the hurricane 
evacuees.
    Available rooms were forwarded via e-mail in spreadsheets 
by the American Hotel & Lodging Association to FEMA on a daily 
basis beginning September 7, 2005, until the process was 
finally discontinued on October 17, 2005, at the request of 
FEMA, who informed the American Hotel & Lodging Association 
that they were no longer needed or they were no longer in need 
of the information.
    While FEMA made clear that their policy was fluid and could 
not guarantee that any of the rooms we had collected would be 
used for the housing program, very little other information was 
provided to us. The Department of Homeland Security confirmed 
each day that they had received our list of available rooms, 
but could not confirm what was happening to the list each day 
and whether or not they were being reviewed by the staff of 
FEMA.
     As time went by and evacuees were placed into hotels from 
shelters and other forms of temporary housing, no word came 
from FEMA regarding when the housing program would end, who 
would be dispatched to support the hotel properties, or what 
would happen if evacuees had nowhere else to go when the 
program terminated. This is a fact that even exists today. With 
all the recent changes that have been recently enacted, this is 
still a fact that we quite frankly do not know.
    You have heard from the panel here that they have been 
given this authorization code for February 7th; some, February 
13th. But what about those applying for that March 1st deadline 
that was recently passed? My understanding in reading the 
documentation on that is that if your situation is undetermined 
at that time, then you can stay as long as March 1st, but still 
it is kind of vague and very ambiguous.
    Today many evacuees remain in hotels with little incentive 
to leave or nowhere to go, placing our members in extremely 
precarious public relations positions. It is disconcerting that 
most the information that we have passed on to our members 
throughout the course of the housing program is taken from 
newspapers and not received from FEMA itself. Given that the 
industry has been so eager to help in this tragic situation, we 
feel that more should be done by FEMA to foster communications, 
alleviate fears, and facilitate the housing program that has 
provided shelter and meals for so many people during this 
difficult time. Although the scale of this natural disaster in 
the Gulf was unprecedented, better preparation and 
communication could have greatly facilitated the process of 
finding housing for displaced residents.
    The American Hotel & Lodging Association and its members 
remain ready and willing to aid in this effort. We have 
willingly responded to this tragedy and standby ready to help 
prepare for future responses. It is our hope that through this 
process of discussion, logistical mistakes can be avoided in 
the future and we will be better able to work with this 
Government agency for the common good of the people affected by 
disasters such as this.
    Chairman Ney. Thank you. Thank you. Mr. Mercadel.
    [The statement of Darrius Gray can be found on page 119 in 
the appendix.]

STATEMENT OF KEVIN MERCADEL, NEIGHBORHOOD RECOVERY SPECIALIST, 
          PRESERVATION RESOURCE CENTER OF NEW ORLEANS

    Mr. Mercadel. Mr. Chairman, members of the committee, I 
thank you for the opportunity to testify today.
    As we attempt to shift attention from clean up to 
reconstruction in New Orleans and the Gulf region; PRC believes 
that we must answer the question how and in what form the 
rebuilding happens and how its historic fabric will be 
protected for generations to come. If we get this response 
wrong, Katrina could turn out to be not only a great natural 
disaster, but we believe a great cultural disaster. It is one 
Louisiana may not --
    Chairman Ney. Can you push the mic a little bit closer, 
sir. Thank you.
    Mr. Mercadel. I am sorry.
    Chairman Ney. That is good. Thank you.
    Mr. Mercadel. My organization, the Preservation Resource 
Center, established in 1974, has had an important impact on the 
revitalization of historic districts in New Orleans through its 
32-year history. Our membership is over 8000. We have had a 
major impact on revitalization efforts in Lafayette Square, the 
Warehouse District, Algiers Point, Algiers Riverview, Bywater, 
Holy Cross, Esplanade Ridge, Lower Garden District, Irish 
Channel, Faubourg Delachaise, Edgewood Park, Pontchartrain 
Park, and many other neighborhoods in the city. These are the 
homes of working people, low, moderate-income families, 
majority African American.
    In addition, we have had a long standing relationship with 
the National Trust for Historic Preservation. Since Katrina, 
PRC has been working hand in glove with the Trust. The Trust 
has established a field office here in New Orleans, staffed it, 
and the office operates out of the Preservation Resource Center 
offices. So my remarks today are consistent with and supportive 
of the Trust efforts to make the Gulf region whole again.
    For more than 50 years, the Trust has been helping protect 
the Nation's historic resources as a non-profit membership 
organization of over 250,000 members. It is a leader in the 
preservation movement that is trying to save the best of our 
past for the future.
    Now throughout the history of the PRC, now enhanced by the 
experience of the Trust in the Mississippi River floods of 
1993, the Northridge earthquake of 1994, and a number of other 
natural disasters, we have learned that almost always the first 
impulse of local officials is to tear down almost everything, 
every damaged building in the name of public safety. We have 
also learned that this first impulse is almost always wrong. 
Obviously there will be historic buildings that will 
necessarily be lost, but we should not lose more than we have 
to. The Federal and State government's role is pivotal in 
alleviating this urge to demolish and time is running out in 
New Orleans. For example, officials in the city are pursuing 
demolition requests and preliminary reports indicate that they 
intend to demolish some 50,000 buildings. Already there has 
been a hasty razing of the Naval Brigade Hall, a significant 
landmark in the history of New Orleans jazz. It was torn down 
September 26th without permits, without permission from the 
city or the owners of the building.
    In New Orleans alone, there are over 30 districts listed in 
the National Register of Historic Places or as locally 
designated historic districts. This represents more than one 
half of the core of the city. It must be emphasized that when 
we speak of historic neighborhoods in New Orleans, we are 
talking in the main about modest shotgun singles, doubles, 
Creole cottages, bungalows, arts and crafts houses and not 
simply our more famous neighborhoods like the French Quarter 
and the Garden District. Recovery efforts must acknowledge the 
special character of the city. Failure to do so would only 
compound the devastation that has already occurred. 
Unquestionably, there is a complex set of issues existing, but 
we believe there is a network of existing Federal, State, and 
local laws that protect historic structures and cannot be 
ignored in the rebuilding of the disaster area.
    On behalf of the PRC and the Trust, I have personally been 
involved almost daily since the middle of September doing 
tours, windshield surveys, and house-by-house inspections in 
just about every neighborhood in this city. We have worked with 
and continue to work and coordinate our efforts with FEMA, the 
State, the Historic Preservation Office, and the local HDLC, 
the Historic District Landmarks Commission.
    Since the beginning of October, PRC and the Trust has had 
10 volunteer teams of architects, preservationists, engineers, 
builders from around the country who have come in and worked 
with us to distribute information about city permitting 
processes, the notices of workshops that we conduct, as well as 
circulate materials. We have a list currently of over 1000 
volunteers from around the country of professionals willing to 
come in and who will continue to maintain these teams as we go 
forward. We have circulated about 3000 buckets of cleaning 
supplies in the neighborhoods--bleach, sponges, so on and so 
forth. We bought 13 generators and over 400 tarps that we are 
distributing, primarily in the historic districts. The 
generators have been given to neighborhood associations which 
in turn loan them to homeowners that are working in their home 
without power. The tarps are important because the Corps, while 
they have this major roof project, does not talk hard roof--
slate, steel, asbestos tiles, which are primarily the types of 
roofs that we have in the historic districts. We conduct weekly 
workshops; attendance has been 40 to 75 people. We have invited 
city officials, safety and permits experts about raising houses 
and I mean r-a-i-s-e as opposed to r-a-z-e. We established--
    Chairman Ney. Sir, your time has expired, but if you would 
like to summarize.
    Mr. Mercadel. Two projects that we feel are most important 
moving forward. As I indicated, there is a tremendous effort to 
demolish buildings. Simply because a building has been flooded 
does not mean it needs to be destroyed. This week, we began 
surveys of buildings. There are 200 buildings on the priority 
list to be demolished in historic districts. We have been 
inspecting them. We are going to share this information with 
HDLC, FEMA, as well as the property owners. And we want to ask 
that you in Congress ensure that the Section 106 regulations 
and existing--we are not asking for new legislation, just 
existing regulations--with respect to historic structures are 
on it.
    Our second initiative is a combination of a project called 
Operation Come Back, which has existed since 1988, and the 
Trust program called Home Again, where we have already 
identified buildings that we are renovating. We are organizing 
volunteers to gut them. We work on a neighbor block by block 
basis. We have a two block area in the Holy Cross neighborhood 
where we are re-renovating a property that we had just 
completed renovating before the hurricane. We acquired two 
other properties, blighted properties, on that block that we 
already have donations of $40,000 worth of materials. The Trust 
has identified a property down the street and the concept--and 
this is in my written remarks--is a focus demonstration project 
that shows we can save buildings.
    If I might, I would like to add to my remarks and just show 
you visually, this is a project that we did in the uptown 
district. This is a project that was done 6 years ago. The 
before pictures are houses that are in significantly worst 
conditions than most of the houses in the city today. The 
bottom shows what we can do with them. It is a project that is 
small scale that can be duplicated over and over. We share this 
information with most of the organizations in the city. And we 
want to again thank you. I will be available for questions.
    Chairman Ney. Ms. Lewis.
    [The statement of Kevin Mercadel can be found on page 131 
in the appendix.]

  STATEMENT OF MURIEL LEWIS, NATIONAL ASSOCIATION OF KATRINA 
                            EVACUEES

    Ms. Lewis. Good afternoon. I am a member of the National 
Association for Katrina Evacuees, which represents over 5000 
relocated residents. We have chapters in over 35 States.
    Some of us are in hotels, apartments, housing trailers, 
living with relatives. Most of us want to relocate back to New 
Orleans; we want to come home. Yes, we have lost memories, 
personal achievements awards, our children's kindergarten 
pictures, K through 12, furniture, jobs, even grandparents' 
obituaries. Yes, there is a healing process that we must go 
through.
    But part of our healing is to be able to come home. 
However, we have many concerns--housing, jobs, schools, health 
care, and neighborhood development. Yes, we want to come home. 
The Baker Bill is stating we will be receiving six percent 
equity from our homes. However, we are not in agreement with 
it.
    Another bill that we have looked at is the CBC, which 
states, it requires FEMA to reimburse entities that perform 
services that should have been performed by FEMA following 
Hurricane Katrina after the entity requests reimbursement and 
allows a retroactive purchase of flood insurance by Hurricane 
Katrina victims who did not live in a designated flood area. We 
know our Congressman Baker voted against it and it was voted 
down by one vote.
    Please reconsider, we want to come home. We do not want 
charity; we want justice. We do not want to sell our property; 
we want to live in our houses. We were told we were in a no-
flood zone; that was the reason why we did not purchase or we 
were not offered, even offered flood insurance. Now, our 
mortgage companies are saying we must have flood insurance. 
Please, help us to keep our homes. We do not want to sell. 
Title 11 will bring hope and relieve pressure off of us. Our 
suicide rate is rising every day, at least five per week. 
Please relieve pressure.
    One other thing I would like to add to that is that many of 
our residents are concerned about food stamps. We had emergency 
food stamps that were issued in the beginning of the pre-
Katrina--well, I should say it was during the Katrina 
catastrophe. However, at this point, once we received the $2000 
from FEMA, they were cut off because at that point in time they 
are no longer qualified for food stamps. So now what was stated 
through FEMA is we could not use the money to buy food; we had 
to use it to buy housing. We want you all to know that there is 
nothing there stating that--with the food stamps program 
stating that we cannot receive food stamps even though FEMA is 
issuing us the funds. So I wanted to make sure that you all 
were--that that was brought to your attention.
    Another thing that I wanted to let you know, I have a 15-
year-old, a 13, and a 17-year-old. My--we live in a hotel in 
Lafayette, Louisiana, and we are going through, and you heard 
the problems that are going--that are faced right now with the 
hotels.
    Chairman Ney. Did you say three children?
    Ms. Lewis. Three children. I am concerned because I have 
one son that is really dealing with this really hard and I am 
having personal problems with him because of this move and 
these problems that we are facing. Our State is still stating 
that the requirements for the LEAP test is still in place.
    From month to month, as you know, the deadlines come about 
and the hotel, they state that 1 month you have to move, the 
next month you have to move, but of course I could tell the 
kids that we have to move to another area because we do not 
know how long we are going to be in a hotel.
    I have applied for a trailer. They asked me if I had 
property. Yes, I have property. My house is gutted out and I 
asked them to put the trailer there. I have requested the 
trailer since October and I do not have, they have not came out 
to put the red markings on the property as they stated earlier. 
But I am still waiting; it has been since October and I still 
do not have a travel trailer in front of my door. So I just 
want to make, to bring these points to your attention.
    I have nothing further.
    Chairman Ney. You have been waiting since when?
    Ms. Lewis. October.
    Mr. Jefferson. Mr. Chairman, if she can provide the 
information, I think we can help her household.
    Chairman Ney. That is what I was talking about. We can look 
into that type of delay.
    Ms. Lewis. I am in the New Orleans East area.
    Chairman Ney. Ms. Boyer too has another issue I think we 
can look at and we will talk with you. Mr. Schedler.
    [The statement of Muriel Lewis can be found on page 129 in 
the appendix.]

STATEMENT OF LARRY G. SCHEDLER, PRESIDENT, LARRY G. SCHEDLER & 
ASSOCIATES, METAIRIE, LA, TESTIFYING ON BEHALF OF THE NATIONAL 
      MULTI-HOUSING COUNCIL/NATIONAL APARTMENT ASSOCIATION

    Mr. Schedler. Chairman Ney, Ranking Member Waters, and 
distinguished members of the subcommittee, my name is Larry 
Schedler. I am the president of Larry Schedler & Associates in 
Metairie, Louisiana. I have been representing buyers and 
sellers of apartment communities here for the past 22 years and 
have transacted more than 20,000 multifamily units exclusively 
in the Gulf Coast region.
    I am here today at the request of two trade associations 
that represent the private apartment industry, the National 
Multi-Housing Council and the National Apartment Association.
    Since we are in New Orleans today, I would like to discuss 
the housing situation in this great city before and after 
Hurricane Katrina. The City of New Orleans is down, but 
definitely not out. It is estimated that approximately 260,000 
residences, both owner occupied and rentals, in New Orleans 
were affected by Hurricane Katrina. It appears that 30 to 35 
percent of our inventory of 50,000 apartment units was 
critically affected by Hurricane Katrina. It is not 
unreasonable to assume that 15 to 20 percent of our total 
inventory of rental apartments will never be rebuilt without 
cooperation from all government entities.
    The area that sustained the largest amount of concentrated 
destruction is East New Orleans. East New Orleans was developed 
in the early 1970s and had become a predominantly moderate 
income apartment market. Its approximately 7500 rental units 
rented for an average of 65 cents per square foot. While these 
rents were sufficient to cover the operating expenses of these 
older properties, they are not sufficient to cover the cost of 
new construction even if the buildings were built to the pre-
Katrina standards. Moreover, the cost of new construction all 
over the State will be higher because of higher cost building 
supplies, insurance, labor and the cost to meet anticipated 
changes in the building code.
    If a rebuilt New Orleans is going to include apartments, 
the Federal Government will have to be generous with incentives 
in the form of tax credits and grants. Otherwise new 
development will remain financially unviable. Good news is that 
there is already overwhelming investor interest in the New 
Orleans market. Developers have been searching for locations to 
develop new apartments, both in the city and the surrounding 
parishes. It is important to note that before the storm, 95 
percent of the available apartments in New Orleans were 
occupied. This means that the city's apartments were virtually 
full. So even before the storm damaged 35 percent of the 
housing inventory, there was virtually no surplus housing to 
help meet the rising demand.
    There is an unquestioned need to build more housing in New 
Orleans and the surrounding area. But meeting this need will 
require more Federal incentives and a streamlined redevelopment 
process. The rebuilding efforts are complicated by the fact 
that high demand, a limited supply of land, and rising 
construction costs will all combine to push the price of the 
resulting housing higher. If State, city, and Federal officials 
are serious about rebuilding the housing in New Orleans, they 
will need to make Federal incentives available.
    Fortunately, Congress has already passed and the President 
has signed into law new incentives to redevelop the Gulf Coast. 
The emergency allocation is $18 per capita, more then nine 
times the current law allocation of $1.90 per capita. Finally, 
the measure increases the size of the credit from 100 percent 
of qualified project costs to 130 percent of such costs by 
designating the areas as GO zones.
    If Louisiana is going to get the maximum value possible 
from the tax credit program, it needs to change its past 
practices of making small allocations and creating new 
affordable housing on a small scale. During the rebuilding 
period, it will be necessary to allow more credits per project. 
This will encourage developments that will meet the large scale 
need and it will attract well-capitalized developers who can 
utilize their skills to create more affordable housing.
    I thank you all for the opportunity to testify today and 
assure you that the NMHC and the NAA look forward to being a 
part of the solution to this housing crisis.
    Chairman Ney. Thank you, very much. Mr. Kelly.
    [The statement of Larry G. Schedler can be found on page 
164 in the appendix.]

STATEMENT OF JAMES R. KELLY, CHIEF EXECUTIVE OFFICER, CATHOLIC 
              CHARITIES ARCHDIOCESE OF NEW ORLEANS

    Mr. Kelly. I thank you for your concern. I thank you for 
your compassion and I thank you for your passion.
    Since 1727, Catholic Charities has been caring for the 
poor. It began in the 9th Ward. In the Nation, Catholic 
Charities started in the 9th Ward; we have a long history. Last 
year, we cared for 125,000 people with such needs as hunger, 
poverty, unemployment, abuse, domestic violence, mental 
illness, and homelessness.
    I was in the Dome; I was at Armstrong Airport; I saw a lot; 
I saw a lot of brave people, a lot of really brave people and a 
lot of good people--the National Guard, the homeless, the 
vulnerable. We have been busy. We have been counseling folks. 
We have distributed 40 million pounds of food and provided 
emergency assistance and counseling to thousands of people and 
listened to too many stories like Ms. Lewis's and Ms. Boyer's 
and Ms. Stewart's.
    We greatly appreciate what your committee has done. 
Appreciate that the legislation has finally been passed. I 
cannot image what Christmas would have been like in this town 
if some of that legislation had not passed. Hope is oxygen in 
this town.
    Thanks for what you have done on the Baker Bill, we pray 
that it will pass through Congress. Where and how to rebuild 
continues to be debated in our town. I lived in Washington; can 
you imagine if northwest and southeast Washington flooded and 
then we were going to take those neighborhoods and prioritize 
who got built first, rebuilt first and who got rebuilt last. 
Those would be some Congressional hearings.
    Prior to Katrina, 20 percent of our citizens lived below 
the poverty line, 30 percent of our children, 47 percent of 
African Americans. Sixty percent of the residents of New 
Orleans were renters, 40 percent homeowner, a flip of the 
national average.
    Who were the victims of Katrina? Seventy-seven percent of 
the victims were African American. Rebuilding should be carried 
out in a manner that treats the area's poor with the same 
respect and dignity as the most affluent. High ground should be 
set aside for rich and poor, white and black; diverse 
neighborhoods are our future. But without your intervention and 
your assistance, without the Government, the market will not be 
kind to the poor.
    Recently, Congress directed the Secretary of HUD to 
preserve Section 8, 202, 811, and HOPWA housing. Yet, on 
November 1st, HUD cut off rental payments to nonprofit 202 
landlords and housing managers like the Holy Family Sisters. 
Many of these damaged and vacant apartments for low-income 
seniors are now nearing default. HUD's most successful housing, 
the 202 program, will no longer be available to the elderly. So 
they cannot come home. And even if we fix the buildings, what 
do they come home to. No doctors, no pharmacies, so we are 
going to put the non-profit landlords out of business? That is 
a major issue. I pray that you can find out answers.
    Most welcome is the low-income housing tax credits. Two 
billion dollars of tax credits will get you 20,000 units of 
housing. That is not very many units, but it is wonderful. 
Never had anything like it, but it is only 20,000 units. And it 
does not set aside any percentage of those for the poorest of 
the poor, people making 30 or 40 percent of median income. I 
ask that you look into that and pass legislation; if not, the 
poorest of the poor will suffer some more.
    The new regulations also require that the credits be spent 
in the year that they are issued. That sounds efficient until 
you hear the complexity of the land issues in New Orleans. And 
also, understand as the mayor said that those credits could be 
spread across all of southern Louisiana, so we could get locked 
out. Credits will go to higher ground, go to areas in civil 
parishes or towns that do not have those effects and New 
Orleans could not get their fair share and I am sure it could 
happen in other parts of Louisiana.
    The construction of new affordable housing is going to take 
time. It is critical; there was a dire need before; there is a 
dire need now. So what do we do today?
    Fast track the rehabilitation of offline public and private 
housing; maybe we use eminent domain for some of these 
landlords sitting in New Orleans East who do not know what to 
do, rather than spending how much money on trailers.
    Increase the number of housing vouchers.
    Increase the value of these vouchers to 130 percent 
including KDHAP.
    Provide support and mental health services to the fragile.
    Transfer all housing responsibilities from FEMA to HUD. I 
have been in the very early meetings at the joint field office 
when a FEMA representative was asked once you put someone in 
those 100,000 trailers that are on their way--this goes back to 
September--what do you do? Oh, we are done.
    Experts predict only 250,000 people will come back.
    Chairman Ney. Mr. Kelly, your time has expired, but if you 
would like to summarize.
    Mr. Kelly. The people of New Orleans are strong; they are 
brave; they need your support. We appreciate what you are 
doing. I will end with scripture. We are called to be one body, 
one spirit, one hope. To be successful we will need a spirit of 
humility and collaboration. Most importantly, we will need 
God's grace and God's speed. I pray that God will bless your 
efforts and through you the good and brave people of the Gulf 
Coast.
    Thank you.
    Chairman Ney. Thank you, Mr. Kelly. Ms. Kegel.
    [The statement of James R. Kelly can be found on page 122 
in the appendix.]

STATEMENT OF MARTHA J. KEGEL, EXECUTIVE DIRECTOR, UNITY FOR THE 
                            HOMELESS

    Ms. Kegel. Thank you, Chairman Ney, Ranking Member Waters, 
and members of the subcommittee. We are so grateful that you 
have come to New Orleans to shine a spotlight on the suffering 
of our people and we are so grateful for your obvious 
determination to end that suffering. I am grateful also for the 
opportunity to testify today on behalf of UNITY, which is an 
award-winning collaborative of 60 different agencies, 
governmental, non-profit, faith-based, large, small agencies 
that are providing housing and services to people experiencing 
homelessness and people at risk of homelessness in greater New 
Orleans.
    Throughout this crisis, members of our 60 agencies, which 
include Catholic Charities, have performed heroically while 
experiencing their own losses, and I want to recognize today 
two of those heroines of Katrina who are here today with me. 
Angela Patterson and Lori Adams, could you stand and be 
recognized.
    [Applause.]
    Ms. Kegel. Angela Paterson of the Louisiana Public Health 
Institute stayed with her disabled clients at the Superdome for 
5 days serving them and immediately following that has not 
missed 1 day serving disabled clients from the Health Care for 
the Homeless Clinic that is operating off of a boat. She is 
truly amazing.
    Lori Adams, like countless other people in our continuum of 
care, evacuated with her mentally ill clients, spending weeks 
with them in difficult accommodations far from home, all the 
while having to deal with her own disabled child. And she is 
also a heroine and so many of our staff members also deserve 
recognition and appreciation.
    We can and we will rebuild New Orleans, and with your help 
I believe that we can create a national model that will ensure 
that the people who are most adversely affected by Katrina, the 
people who are at most risk from being permanently displaced 
from their home communities, specifically the low-income 
disabled people and elderly people will be able to return home, 
will have a place to call home in their beloved city. And this 
model will also include affordable housing for musicians, hotel 
and restaurant workers, and other low-income workers who need 
affordable rental housing.
    Katrina's catastrophic flooding caused widespread 
homelessness, including the tragedy of thousands of people with 
disabilities and elders losing their homes. Before the storm, 
the City of New Orleans had disproportionately high rates of 
poverty and severe disability. New Orleans counted 6300 people 
who are homeless, many of whom have serious and long term 
disabilities. Thousands of New Orleans residents were at 
constant risk of homelessness, were living on income below 20 
percent of median income. Sixteen percent of New Orleanians 
suffered from serious disability. We cannot and we must not 
ignore the needs of these most vulnerable people as we rebuild 
our devastated city. It is up to all of us to ensure that the 
most vulnerable people affected by Katrina can come home. And 
this means creating new high-quality affordable rental housing 
that meets their needs.
    We have been working very hard in partnership with the 
city, the State, local non-profits, the National Alliance to 
End Homelessness, other national partners to create a plan to 
create 10,000 units of affordable housing, rental housing, 
including 5000 units of supportive housing for people with 
disabilities and special needs. This plan already has the 
support of members of Bring New Orleans Back Commission and the 
Housing committee of the Louisiana Recovery Authority.
    I understand that this Committee already strongly supports 
the supportive housing model as a proven strategy to end and 
prevent homelessness among people with disabilities and special 
needs. As you all know, supportive housing is permanent 
affordable rental housing that is directly linked to community-
based services, health care, mental health care, employment 
services that allow people with special needs to stay housed 
and prevent them from becoming homeless. And in city after 
city, supportive housing has been proven to be cost effective 
and to be extraordinarily successful in keeping people with 
special needs housed.
    We have two requests of you today. First, in order to make 
this plan a reality when it is so very much needed, we will be 
coming to you for support, for rental subsidiary because the 
only way to make this plan work when the people who need 
supportive housing are extremely low income is if there is an 
ongoing operating subsidiary, a rental subsidiary, for these 
units to ensure that the housing is affordable.
    Second, we are very appreciative of your wanting to 
eliminate all unnecessary deadlines for Katrina victims, 
whether it be deadlines for leaving the hotels, deadlines for 
staying in trailers. We also ask that you look at eliminating 
all unnecessary deadlines for the KDHAP program. As you may be 
aware, the special needs portion of the KDHAP program still is 
not up and running because the forms and the contracts with the 
non-profits have still not been issued.
    Chairman Ney. Sorry, your time is expired, but if you would 
like to summarize, please.
    Ms. Kegel. Meanwhile the people with special needs, 
homeless people, are being given a March 11th deadline to sign 
up, even though FEMA has always told them they were not 
eligible for FEMA assistance and there is no plan in place to 
effectively notify these persons of their eligibility for this 
program. So we would ask that you give people at least to 
December 31st of this year to be able to sign up for this 
program, which they cannot even access at this point, and to 
require that HUD or FEMA put into place an effective publicity 
plan to reach out to these people who so desperately need this 
assistance.
    In closing, I just want to quote President Bush in his 
speech in Jackson Square on September 15, 2005. ``We want 
evacuees to come home for the best of reasons, because they 
have a real chance at a better life in a place they love.''
    Thank you so very much.
    Chairman Ney. Thank you. Mr. Perry.
    [The statement of Martha J. Kegel can be found on page 125 
on the appendix.]

   STATEMENT OF JAMES PERRY, EXECUTIVE DIRECTOR, GREATER NEW 
               ORLEANS FAIR HOUSING ACTION CENTER

    Mr. Perry. Committee members, I would like you to consider 
the following statements.
    I would like to live--``I would love to house a single mom 
with one child, not racist, but white only.''
    ``Not to sound racist, but because we want to make things 
more understandable for our younger children, we would like to 
house white children.''
    ``Provider will provide room and board for $400 but prefers 
two white females.''
    These may sound like flashbacks to the 1960s, but these are 
advertisements that were on Katrina evacuee websites in 2005.
    My name is James Perry. I am director of the Fair Housing 
Action Center. I have 28 pages--
    Chairman Ney. Mr. Perry, that was on a website of who?
    Mr. Perry. Sir, there are five websites.
    Chairman Ney. Okay.
    Mr. Perry. Katrinahousing.org, Katrinahome.com, DHRonline, 
and reliefwelcomewagon.com. These websites have these 
discriminatory advertisements listed on the websites. I have 28 
pages here of those very advertisements. My organization has 
investigated and found the advertisements and we have pursued 
litigation as a result. But very blatant discriminatory 
advertisements. Unfortunately discrimination is alive and well 
in the wake of Hurricane Katrina and Rita.
    My organization is an 11 year old organization that fights 
to eradicate housing discrimination. We have gotten more than 
200 complaints of housing discrimination since the hurricanes 
hit. And I am going to give you a few examples of some of the 
things that we have been uncovering.
    First is that some landlords have represented to black home 
seekers that vacant livable units were unavailable or 
unlivable.
    Some black home seekers have been charged more rent and 
higher deposits than the white, for African Americans than for 
their white counterparts.
    Rental agents have failed to return messages to African-
American home seekers while returning the calls of their white 
counterparts.
    Rental agents offer special endorsements like lower 
security deposits to white home seekers while failing to offer 
the same to their black counterparts.
    People with mobility impairments have complained that there 
are few accessible units available to them.
    In December, we were forced to file a lawsuit against the 
City of Denham Springs after it applied its zoning code in a 
manner that discriminated against a group home for displaced 
New Orleans residents with mental disabilities.
    And I previously listed these five websites or noted these 
five websites. Important to note is that one of the websites, 
DRHonline, is specifically endorsed by FEMA. FEMA lauds this 
website as one of the best mechanisms for people to find 
housing. And this is in a Times Picayune article even after we 
filed a complaint against FEMA and even after FEMA knew that 
there were discriminatory advertisements on the website.
    A study by the National Fair Housing Alliance after the 
hurricane found that 66 percent of the time evacuees who were 
African American were treated less favorably than white 
evacuees seeking housing.
    I say to you, committee members, unfortunately, housing 
discrimination is alive and well after the hurricane. My 
organization is the single organization for assisting victims 
of housing discrimination in the entire State of Louisiana. 
Before the hurricane, we had four employees; since the 
hurricane, we are down to two employees because two of our 
other employees have been displaced. We receive some assistance 
in fighting housing discrimination from HUD, some assistance 
from the Lawyers Committee for Civil Rights Under Law, and some 
assistance from the National Fair Housing Alliance, but we need 
more help. And I heard you mention earlier that there has been 
money appropriated for fair housing and we need it, desperately 
need it, and we thank you for it.
    In addition to talking about housing discrimination, I want 
to address a few overall concerns when it comes to the 
rebuilding. The first is that I have got to make clear before 
we talk about housing, we need levees; we need category five 
strength levees. I know it has been said already, but I cannot 
emphasize enough how important and essential it is to us.
    With that said, the issue here is changed. It had been 
about food and water and these basic needs that people had, but 
it has changed and the new most important issue is housing and 
that is why we are all here today, because this housing issue 
is so very important.
    While I would submit that there are several places where 
FEMA has obviously failed when it comes to housing and I am not 
going to go into that too much because we have talked about 
them a good bit already. But I will talk about SBA for a moment 
because I think we have not focused on, we have not talked 
about SBA much. But essentially, SBA is running a housing 
program in that evacuees who need to get--who need to get loans 
in order to renovate their homes are directed by FEMA to SBA to 
apply for loans.
    SBA, in October, had turned down nine out of every 10 loans 
for housing assistance. Nine out of every 10 loans in October 
had been turned down for housing assistance. So the question 
becomes for a person who is relying on SBA for the loan to 
renovate their home, where do they turn? Because SBA is not 
going to help them. So one thing that I would implore is that 
you look at FEMA and SBA and consider that what they have 
actually had to do is change from business entities and from 
emergency management entities into housing entities. And so, 
just as the gentleman suggested earlier, we would recommend 
that HUD handle housing issue. HUD is a true housing entity.
    With regards to the Baker Bill, we do support the Baker 
Bill, but there are a few things that we want the committee 
members to consider as the Baker Bill makes its way through the 
process. The first is that right now it only gives 60 percent 
of the value of a home to a homeowner. We think that amount 
should be 100 percent.
    Second is that we want to make sure that participation in 
the Baker Bill remains completely optional and at no point does 
it ever become required for citizens.
    Next is that the Baker Bill sets it up so that developers 
can come in and develop properties. We think that there should 
be an option so that citizens could also choose to develop 
their own homes through the funds provided through the Baker 
Bill.
    Third is we think that there should be a requirement that 
the Baker Bill--that any developers who acquire property 
through the Baker Bill process are required to have mixed 
income developments and they are required to reserve a portion, 
at least 20 percent of the properties, and make them accessible 
for people who have mobility impairments.
    The last thing, the last point that I want to make is about 
the Hope 6 program. I think that the Hope 6 program on the 
whole is an excellent idea. It is this theory where you want to 
deconcentrate poverty and end residential segregation. 
Unfortunately, it has not worked in the City of New Orleans. I 
think that the committee members have viewed some of the Hope 6 
projects and they are beautiful; they really look good. And 
here is the fundamental issue. What happened is that it has 
taken poverty that was concentrated in one area, deconcentrated 
that particular neighborhood, but then concentrated it in other 
low-income parts of the city. Right? So in effect, what 
happened is that there is more poverty in New Orleans East and 
in the St. Bernard housing development because so many 
residents who were in what are now Hope 6 projects were 
reconcentrated there. So there is more residential segregation 
as a result of the Hope 6 program here in the City of New 
Orleans.
    So we need some more guidelines to make sure that I guess 
when you desegregate you cannot desegregate just one 
neighborhood, because what happens is that you may end up 
segregating another neighborhood or reconcentrating poverty in 
another neighborhood. It has to be a citywide approach, a 
holistic approach.
    Finally, I would submit that here in the City of New 
Orleans, we have been through obviously a very, very tough 
time. You know, I think that in other parts of America where 
Katrina had some effect, it affected just about everybody. And 
it really did not have any care for what race a person was. But 
here, because of residential segregation, it happens to be that 
mostly African-American neighborhoods were affected. What I 
implore you is that as you consider legislation, you make sure 
that the goal of the legislation is to end residential 
segregation. If there had not been residential segregation, 
then Katrina would have affected people equally, but rather 
African Americans were affected by and large by the effects of 
Hurricane Katrina.
    In my comments there that I submitted, I have in my written 
comments about 44 recommendations or ideas for things to 
consider and there are some things that are directly 
appropriate on the Federal levels, so I implore you to take a 
look at those comments.
    Thank you.
    Chairman Ney. And you have that for the record for us?
    Mr. Perry. Yes.
    Chairman Ney. Dr. Gable.
    [The statement of James Perry can be found on page 153 in 
the appendix.]

 STATEMENT OF DR. WILLIE GABLE, JR., EXECUTIVE VICE CHAIRMAN, 
             NATIONAL BAPTIST CONVENTION, USA, INC.

    Mr. Gable. I represent the National Baptist Convention, USA 
Housing Commission where I am executive vice chair and I am a 
board director of the American Association for Homes and 
Services to the Aging, representing about 6000 facilities for 
senior citizens in the country. My testimony has been provided 
to you and is on record. I would just like to, in the interest 
of time, highlight a couple of areas of the written testimony 
that is in your record.
    One is that I think it becomes critical that the project-
based Section 8 certificates that HUD has, that there be an 
abeyance for those Section 8 project-based certificates for our 
units that have been damaged so that we do not lose those 
certificates, but that it be held until our facilities are 
brought back on line. If not, we are going to end up without 
any income.
    In addition, in the testimony we are asking that you would 
have HUD to immediately release dollars for project-based 
facilities so that we can get them back on line. When the 
hurricanes occurred in Florida, what happened was they were 
told that they could use their deductibles and they would 
reimburse them, but it was long coming in terms of being 
reimbursed by FEMA for those deductibles.
    In addition, HUD has REOs in a number of HUD properties 
that they own in and around the State and in the country. What 
we are recommending is that waivers be given and those 
properties be transferred to faith-based groups and to non-
profits so that we can use those facilities to house low- and 
moderate-income individuals in those particular facilities.
    And the Louisiana Baptist State Convention, along with the 
National Baptist Convention and AAHSA, stands ready right now 
to receive some of those properties. What happens most of the 
times with the REOs is that the major corporations are able to 
purchase those because they have the funds to get them very 
quickly off the market from HUD. But if we had the opportunity, 
I think that we could do so.
    I wanted to share those highlights, but also to point out 
as a pastor and as a victim of Hurricane Katrina who lost 
everything in my home and my family--now living in Baton Rouge 
with my family--, what I found out after the first week was 
that FEMA purchased all of the rental housing in Baton Rouge 
and locked it up so that most of us had to get--units that we 
have now in Baton Rouge, we either got them because of the 
blessings of God or somebody helped us. But they put FEMA 
employees in units. Particularly sometimes where you had two 
bedrooms, you have got one FEMA employee staying in a facility 
in the Baton Rouge and other areas. They purchased all of them 
and you can check that for the record.
    For the FHA program that is being touted saying that we can 
get, who had FHA homes, we can go to FHA and get a loan. They 
are not saying in the loan application--Mr. Williams, who was 
here is not saying for those who were eligible for FHA, the 
only way you can get that FHA 1-year mortgage payment is that 
you have to prove that you have no income. Well, I mean, I do 
not have any income, at least from my congregation, but my wife 
is working, so we will not meet the threshold to even get the 
FHA. And yet we cannot move back into our home. Actually, what 
we are doing is robbing Peter to pay Paul with Visa and 
MasterCharge. Peter and Paul is going to show up at some point 
to get paid and we realize that.
    The other thing is that with the $11 billion of CDBG 
dollars that you approved, the Louisiana Recovery 
Administration, as I shared with Congressman Cleaver, is going 
to be the group the State utilizes to develop the plan. So 
there will not be no community input on that. New Orleans 
should have gotten a portion of those dollars automatically 
rather than having to submit a plan to the State that does not 
have the capacity to handle the dollars.
    And then finally, Entergy in my area, where we have just 
been told yesterday we cannot rebuild in Lakeview, Entergy sent 
a letter yesterday to my home in Baton Rouge saying they are 
turning the electricity on and either I pay a monthly fee, even 
though I am not there, or I disconnect and if I disconnect I 
will get my deposit back, but then if I go back I will have to 
pay a new deposit that will be higher than the deposit that I 
have now. So, you know, I have to determine whether--obviously 
what I am going to do is pay a monthly fee and not be there 
because there is nobody in the neighborhood. So I think these 
particular things are quite important in terms of us trying to 
get together.
    Congresswoman Lee asked about connectivity. What we have 
been trying to do through Global Crossing/Bell South, we were 
able to get a 1-800 telephone number for our members of our 
congregation free of charge, and through that method we have 
been keeping at least 50 families online three times a week and 
providing them with information. We are a part of that 8000 
that the mayor talked about who want, who have asked for a 
group of trailers to put on our properties around the church so 
that we can bring our members back. But like Jim Kelly and 
others have said, I had three funerals last week, last week, of 
individuals who died early because of this trauma.
    And so I thank you for coming. I implore you to continue to 
do what you are doing. As we come near the celebration of Dr. 
Martin Luther King's holiday, I am reminded of something that 
he said. ``Our lives begin to end that the day that we remain 
silent on things that matter.'' And I believe that you are 
going to--and I know in my heart you are not going to remain 
silent.
    I thank you.
    Chairman Ney. Thank you. Mr. Noel.
    [The statement of Dr. Willie Gable, Jr. can be found on 
page 108 in the appendix.]

         STATEMENT OF RANDY NOEL, PRESIDENT, REVE, INC.

    Mr. Noel. Good afternoon, Mr. Chairman, Ranking Member 
Waters, members of the subcommittee. Thanks for the opportunity 
to come and address you.
    My name is Randy Noel. I am a custom home builder and I 
want to share with you the experiences that we have been having 
since the hurricane. My written testimony is an expansion of 
what I am going to tell you today. These are the things that we 
see are issues with us rebuilding this great city and the 
surrounding area.
    One of the significant problems is the homebuilders and the 
remodelers being able to find laborers. It has been very, very 
difficult to find people to work for us because, for example, I 
had a bricklayer that lived in the 9th Ward. He lost everything 
in the 9th Ward, moved on to Mississippi, and started to work 
there. He would have come home in the first couple of weeks, 
but he did not have any place to live. And so he remains in 
Mississippi. And we lost several of our workers that way.
    Then it came time to hire new workers and it was difficult 
to find new workers because the large contractors that were put 
on by FEMA were out hiring our people at double the salaries. 
We would have people come in; we would start the day with 10 
framing carpenters to frame a new home and at the end of the 
day end up with four because they kept getting fed off at these 
higher salaries and these other opportunities which has made it 
really, really difficult for us to begin the rebuilding effort.
    The other thing about the temporary housing has been, as 
soon as the hurricane hit, most of the housing that was 
available was zapped up and you have heard that all day. And it 
was very difficult to get trailers. We went to the Office of 
Emergency Preparedness and said that we need trailers to put 
our laborers in so we can start to rebuild this area. Because 
most of the homebuilders in this area are small business 
people, they did not get the trailers as did the large 
corporations and larger refiners and manufacturing areas that 
were able to get trailers.
    And I have a son who wanted to get involved in the recovery 
effort. He hauled debris for about a month, then he wanted to 
deliver trailers. And this would give you an example of the 
situation with the trailers. He was going to pick up a trailer 
at Louie Armstrong Airport one day and they were going to 
release the trailers at 10:00 and he got there at 10:00 and 
they said, well you need to go on home because the 25 trailers 
we release a day are already gone. So he had to go like the 
next day at 5:00 in the morning to get in line with a long line 
of folks that wanted to pick up trailers and deliver them to 
people's home sites, but they only delivered 25 a day. And at 
that rate we will not have trailers for a long, long time. That 
needs to be addressed.
    Another situation that we are finding happen is the 
Homebuilder Association of Greater New Orleans put on a 
consumer fair last year where we invited people to come and ask 
us questions about rebuilding their houses, about remodeling 
their houses, and where to go and what to do. We had some 
thousand people show up and the number one question was they 
were completely confused about what to do next. And part of the 
problem is, is (a) in the media we have been constantly 
bombarded with we are going to raise the base flood level and 
you are going to have to raise your home. Well, that probably 
will not happen for almost a year to get new flood insurance 
maps put in place. The base flood elevation is the maps that we 
have had since 1984. So we were constantly telling people go 
ahead and fix your house; if your house is built after 1984, 
you do not have to raise it to the base flood elevation.
    The second thing was is FEMA has a mission statement that 
basically says that they want to mitigate future damage. Part 
of that issue is they go out and try to assess through the 
permitting office whether their home has been 50 percent 
substantial damaged or not. The definition of that is if your 
house was worth $120,000 before the storm, you take $20,000 out 
for the land value. After the storm, if it costs $50,000 or 
more to repair your home, you are now required to raise it to 
the base flood elevation if it is not at the flood elevation.
    The confusion is is the way that is established it is real 
subjective. It depends on who the person is making that 
establishment. So what they did is they put on a website, the 
city website, a range in a lot of cases, 40 to 70 percent.--
What do I do now? And then if they show up at the permit office 
and try to get the permit to repair their house if they have 
been assessed as being more than 50 percent, they have the 
opportunity to appeal it, but you cannot call the permit office 
right now because there is no way to get to them on the phone 
and if you go and get your building permit, it is a day's event 
because of the line that is going in there.
    Part of the requirements that FEMA has is you have to have 
a building permit to do repairs. So everyone that is doing 
repairs has to go in and get a building permit. Now you can get 
the permit online, but the problem is you have to go to the 
office to get it. And they have kiosks set up in there, but 
they are five or six deep and they do not always work. So it 
makes it very difficult.
    The 50 percent rule, I can take four or five different 
appraisers come up with four or five different values and I can 
take four or five different contractors and come up with four 
or five different contracting repair values.--And which one is 
right and which one is wrong? It is just a bad way to do this 
at such a bad time. People are emotionally drained because of 
this whole process and then be confused about whether to 
rebuild, tear down, buy new, move away. It makes it very 
difficult. So we have to look at another way of doing this 
mitigating for future damage. This 50 percent substantial 
damage rule is real problematic.
    The BFE, Base Flood Elevation, needs to be clear. The 
people in New Orleans need to know if your home was built after 
1984, we are not raising your house; you do not have to raise 
your house. Do not worry about the 50 percent substantial 
damage; go fix your house. That needs to be stated clearly so 
they know that so they can go ahead and fix the house.
    Chairman Ney. Your time is expiring. But you can summarize.
    Mr. Noel. I think the most important thing that we need to 
do from the Federal Government perspective is our permitting 
office--and from the homebuilders perspective--our permitting 
offices are swamped trying to meet this criteria. They do not 
have tax revenue to continue to have employees, so they had to 
lay employees off, so they cannot issue the permits so people 
can rebuild.
    We are confusing the folks with this 50 percent substantial 
damage rule and we are confusing the folks by not giving out a 
clear distinct message on the Base Flood Elevation.
    And one other thing, if I might add, is my firm believes if 
we are going to do anything about affecting people's 
properties, they need to be an active, engaged person in that 
process. The American dream of owning property in this country 
needs to be protected at all cost. We are going to rebuild this 
great city and the Homebuilders Association are going to help 
rebuild the city. We have a lot of people from around the 
country that want to help rebuild the housing where those poor 
folks can go. We work with ownership wealth program; this is a 
major opportunity where we can move tenants into homeowners 
with the help that we are getting from around the country. And 
I think it is going to be exciting what happens in the next 5 
years.
    Thank you.
    [The statement of Randy Noel can be found on page 143 in 
the appendix.]
    Chairman Ney. Thank you very much.
    A couple of questions I had. Ms. Lewis, for families such 
as yours, the hotel rooms that you get, is it two rooms or one 
room?
    Ms. Lewis. One room, two beds.
    Chairman Ney. One room.
    Ms. Lewis. Double beds.
    Chairman Ney. Two beds. No other rollaway?
    Ms. Lewis. No, and if you get the sofa bed, you get the 
king size but you just get one bed. So you can either get two 
double beds or you get the king size bed.
    Chairman Ney. I am not blaming the Hotel Motel Association 
for this. You built that a long time ago not anticipating that 
this was going to happen. I just need to say that. I just--like 
I said, as much as I dealt with this issue, there is just new 
things coming out that frankly unless--I do not know, I have 
not paid attention, that are not being talked about, about 
people's conditions.
    A couple other points maybe you will want to answer or 
anybody else. What about, there used to be women shelters that 
women could go to if they had abuse of women; now those are 
gone I understood. Has there been anything recreated for 
example for women shelters, for halfway houses, for persons 
with special needs that had a workshop maybe they worked at? 
Back home we have workshops, things like that. Has that been 
temporarily recreated?
    Mr. Kelly. We ran the Crescent House Women's Domestic 
Shelter in New Orleans. You have seen its picture everywhere. 
We also have a set of attorneys who work protecting women; we 
have counselors. We have two buildings; one we will probably 
open this month. In general, what we understand is women will 
not flee in the early months because they are afraid of what 
will happen. After 3 or 4 months, the post-traumatic stress 
starts, then the numbers are going to start to spike. 
Understand that a women flees 7 times. Once you put a person in 
a shelter, the idea of a shelter is to help them then move on 
to housing. We know the issue for those is permanent housing. 
We are working with a whole network throughout the State, so if 
we have a woman who needs to flee, we access other centers 
within the State.
    Mr. Gable. We have two substance abuse facilities in the 
community and we have been working with FEMA to try to get 
those back on line and Louisiana Public Assistance Program. But 
I think there are about 160 pages that we are working through 
to get those two. Now we are keeping track of our clients to 
make sure where they are around the country and if they are 
getting the support. But the problem is getting the assistance 
from FEMA to get those buildings back open so that those 
individuals--and actually these are substance abusers who were 
managing their addiction saying that they want to come back.
    Ms. Kegel. We had about 2700 emergency, transitional, and 
permanent housing in our continuum of care prior to Katrina and 
just this week we updated what the current status of all those 
units are and only about a quarter are currently operable. And 
that is primarily because of storm damage, most of the agencies 
still have not gotten their insurance settlement. Difficulty--
they have difficulties finding, you know, companies to come out 
and do the work. That has been a major problem. And then the 
other problem is personnel; some of the buildings that have 
reopened have not been able to get at full capacity because so 
many employees have been lost, you know, were displaced and 
unable to come back home.
    Normally, I am not a fan of more emergency shelter, but 
actually in New Orleans we really could use a Red Cross 
shelter. And we have tried hard to get the Red Cross to open a 
shelter here and have not been successful. Because our street 
outreach workers are having to turn away. We estimate--they 
estimate to me that there is at least 2000 homeless people and 
I am not counting of course the people that are living in 
hotels and trailers. Just 2000 literally homeless people in New 
Orleans right now, and we only have one of the homeless 
shelters open right now. The others were not able to re-open 
for a variety of reasons; two of them were severely damaged. 
And this is a city that actually does need a Red Cross shelter 
more than anyone else and we cannot get a Red Cross shelter 
here.
    Chairman Ney. Do you know why?
    Ms. Kegel. Well, I would rather have the city and Red Cross 
answer that question rather than put words in their mouths.
    Chairman Ney. Okay, one--we might ask that in a follow up 
letter. I think you mentioned something about a rental 
subsidiary deadline?
    Ms. Kegel. Yes, the Katrina Disaster Housing Assistance 
Program, which is the HUD-run program for people who had 
received Federal HUD housing assistance prior to Katrina and/or 
were homeless prior to Katrina. That program has a March 11th 
deadline. And the special needs portion of it anywhere in the 
country is not even running at this point. And especially for 
the homeless people who were told by FEMA that they were not 
eligible for FEMA assistance, most of them never signed up for 
FEMA assistance. They tried to; they were told that they were 
not going to be eligible to get any help. So to tell them 
that--I mean to have a March 11th deadline when this program is 
not even accessible, as we speak, for a population that is very 
hard to reach and there are no funds in the KDHAP Program to do 
outreach, it is just not reasonable. And I think that if there 
has to be a deadline, it needs to be December 31 so that these 
non-profit organizations have a chance to try to do outreach 
and really there has to be a national publicity campaign to try 
to reach homeless people around the country to let them know 
that they are eligible for this program because many of our 
pre-Katrina homeless people are still scattered.
    There were many other heros who did a great job getting as 
many homeless people as possible to the Superdome before 
Katrina, so most of them ended up going to Houston. From 
Houston, they were evacuated all over the country. And they 
need an opportunity to avail themselves of this assistance.
    Chairman Ney. For the members, I will finish up here; I 
will be real brief.
    Dr. Gable, I think it was your personal home, you cannot 
rebuild, they said, you said can not rebuild?
    Mr. Gable. Yesterday, the plan came out saying that our 
area in Lakeview--
    Chairman Ney. I am sorry, where is Lakeview in relationship 
to--
    Mr. Gable. Out towards--
    Chairman Ney. We were by there today. I am sorry, yes.
    Mr. Gable. So they are telling us that we cannot rebuild 
and, you know, that 50 percent that Mr. Noel was talking about.
    Chairman Ney. I am sorry. Who told you cannot rebuild?
    Mr. Gable. Well, it is being recommended by the city's 
Commission for Rebuilding New Orleans.
    Chairman Ney. Why would that be for Lakeview?
    Mr. Gable. Because we were--the levees there are not 
sufficient and again having grown up here, it was never the 
levees; it is a levee wall. And the levee walls were engineered 
improperly, constructed improperly, and maintained improperly. 
And that is what broke. You did not have water going over the 
Mississippi levee or the Lake Pontchartrain levee. There is a 
difference in the old levees with the mound and a levee wall 
that holds the water back. The water pushed those walls and 
that is what caused the flooding.
    Chairman Ney. What would be the difference of decision of 
rebuilding, let us say, in the 9th Ward versus where you are at 
or was it, were you so close to the levee that the force of it 
was more destructive?
    Mr. Gable. I have not had a chance to read the report to go 
online. It just came out yesterday. Some others might be more 
familiar with it.
    Chairman Ney. I am just curious what makes the difference 
that you can rebuild in the 9th, but you cannot rebuild--
    Mr. Perry. It does not really say that you can rebuild in 
one neighborhood or another. What it says is that there should 
be a period where citizens should come back to the worst 
affected areas and start to work and if the areas see a 
significant come back, then the city will make a decision at 
that point to start to dedicate resources to that area. If the 
neighborhood does not get together and come up with some type 
of plan and start to come back, then the city will not 
designate resources. So, in essence, what they say is--
    Mr. Gable. We have got to do that in 48 days.
    Chairman Ney. That is hopeless.
    [Laughter.]
    Chairman Ney. You think the Feds are bad.
    Mr. Perry. What they say is that you have to wait this 
whole period; they recommend do not issue any permits; do not 
do any construction at all until they determine what 
neighborhoods are the neighborhoods that will come back. So if 
you are in Houston, or somewhere else, you are supposed to sit 
there and wait until the city makes a decision about which 
areas. We do not know if it is going to be lower nine.
    Chairman Ney. But in my hometown, I had a county that had 
24 percent unemployment; it is Appalachia; our steel mills 
closed, et cetera, but the whole thing is you can live in a 
county that has some depressed economy, but you can live in one 
place and work in another. So it is not really incumbent upon 
just what stores are rebuilt in a neighborhood, I would not 
assume. I do not want to get way into this. This is some local 
discussions, but if they are going to use Federal money or want 
Federal help too, those discussions I think need to occur, my 
opinion, with the Fed, State and local.
    Mr. Kelly. It would be helpful for you all to see the map 
of 80 percent of the city.
    Chairman Ney. I have not seen it. Could we get a copy of 
that map?
    Mr. Jefferson. It was a capitulation to the idea that the 
decision makers on the committee did not want to make a 
decision. But they have made one impliedly by giving the 
citizens such a short window of opportunity. Basically, the 
decision bears no relation to the risk that is supposedly 
presented in the neighborhood for flooding. If enough people 
hold their hands up, no matter how low the area is, they 
apparently get paid attention to. And if they do not hold their 
hands up, of course. They do not.
    Now this is totally counter-intuitive if you are talking 
about how to make the area safer for people to live in and you 
are worried about areas of survival, that is one thing. What I 
think is happening here of course is that there was just a 
reluctance for the Commission to say we do not think you ought 
to rebuild here. They made it impossible for people to come to 
decision themselves to do it. So consequently they are going to 
say people are unable to have meetings to sustain themselves. 
We have communities and we have virtual communities with folks 
all over the country; how can they come together in that short 
period of time. How can they make a decision at the end of the 
day. If they keep to this proposal, you will have large parts 
of the city written off.
    Without taking up the committee's time, as I said today if 
the Netherlands can live 20 feet below sea level and they are 
there for the reason that it has economic potential, they need 
deep sea water in order to have a huge port like they have. 
That justifies the existence of the Netherlands. There would be 
no Netherlands without this deep sea water. But it presents a 
threat.
    We are here because of the river. New Orleans is justified 
as a community because of its situation on the river and access 
to the Gulf and on out to the world. Otherwise there would be 
no reason for it to be here. We have to learn to live with the 
water and I guess all the rest of it, the oil and gas and all 
the rest of it that we explore off here.
    So, in any event, without taking up the committee's time, 
what essentially has happened here is you have made a plan 
which essentially is going to write off large parts of the city 
if it is adopted, and I hope it will not be adopted in the way 
it was presented.
    Chairman Ney. I want to ask Ms. Lewis--another question for 
Ms. Lewis. The schools, how are children; children are going to 
school?
    Ms. Lewis. Yes, children are going to school. They catch 
the buses from the hotels.
    Chairman Ney. I noticed some of the schools were destroyed; 
I think I saw Martin Luther King Elementary; I saw it.
    Ms. Lewis. I was not speaking about here; I was speaking 
about in Lafayette.
    Chairman Ney. Oh, I am sorry. I was talking about here, 
people that were here in hotels or in Lafayette. So you are in 
Lafayette.
    Ms. Lewis. I am in Lafayette.
    Chairman Ney. There is a school over there; I am sorry. One 
other thing, what about counseling services; obviously people 
are under all this stress. Children, you know, are in hotel 
rooms, and it is tough enough if you have five or six rooms and 
you know how things are. So are there counseling services, a 
number that people can call, pick up the phone and call 
somebody?
    Ms. Lewis. When I first went into the area and I started 
having problems with my son, because he felt that he lost 
everything, he was devastated with the situation. He is a 15-
year-old; I went to the school and asked them for counseling. 
They did not quite--of course, this was new to them too. So 
they told me that we could have someone come in and talk to him 
for maybe an hour and that is about all we can do. They said 
that was something that has to be in place from the State level 
in order to put counseling in the schools. So I asked them what 
about the requirements for the LEAP test for my son, because he 
is in the 10th grade. They stated that he would have to pass 
the LEAP test like everybody else would have to pass, even 
though he went through the devastation he went through. I went 
several times and asked for counseling for him. But since--I 
think one school I found out they did have now in place I think 
it is 1 hour a week with the students.
    Chairman Ney. So the school is helping, the school is the 
resource people would probably turn to for children then, the 
school is the resource for counseling?
    Ms. Lewis. I asked many schools about it because I went to 
several schools to visit other children besides just mine. They 
really do not have a clue how to deal with this situation 
because they have not been through that themselves. So they 
really do not understand what the children are actually going 
through.
    I have a friend that lives in Houston and her son got in a 
fight for the first time because kids were teasing him because 
he came from New Orleans and he lost everything. He was saying 
about his little toys he had lost, so he took it personal as a 
child of course. So the kids, they do not--the teachers do not 
understand, some of the principals either, why the children are 
acting out at this time.
    Chairman Ney. Mr. Schedler, real quick, there is a lease 
issue. I heard it in Washington with our hearings; there was a 
lease issue. I cannot remember exactly what it was, but that 
the people in the hotels were having a problem because the 
Government--I do not know if it was FEMA; I think it was FEMA--
could only say you could have a 3-month lease or something. Do 
you know what I am speaking of? There was an issue and they 
said that people that had, you know, obviously had rental 
properties, it would be hard to say okay, 3 months, we will do 
a lease for you. It is hard to require--have you heard of that 
issue at all.
    Mr. Schedler. Are you talking about hotels specifically?
    Chairman Ney. The people living in hotels and now want to 
come into apartments.
    Mr. Schedler. Okay, what I have seen down here has been 
generally what they have done before which is 6 month leases.
    Chairman Ney. Six months, okay.
    Mr. Schedler. I cannot speak for everybody; I think most 
owners are probably going for 6 month leases.
    Chairman Ney. Thank you. Ms. Waters, thanks for your 
patience.
    Ms. Waters. Mr. Chairman, I would like to again thank you 
and thank all the Members who showed up here today, thank all 
panelists who helped us to understand exactly what is going on 
here. I am going to leave here pretty disgusted, feeling that 
there has been a lot of bumbling, incompetence, manipulation, 
insensitivity, and everything that I can think of to describe 
what I believe is a lack of responsiveness or will to do what 
needs to be done to provide some basic assistance to people who 
have been devastated in ways that most of us never ever ever 
could have imagined before.
    And so I am having several thoughts here. One is I am going 
to work with Mr. Jefferson taking a look at some of the needs 
that have been identified today to see if we cannot expedite a 
few things; just take some of these things as case management 
kind of needs and see if we cannot move some things. Mr. 
Jefferson is back in--for example, Dr. Gable, this site for the 
potential of 8000 trailers to be put on property that you have 
identified, I think that should be one of the cases that we 
take on with FEMA to see if we cannot move it along with these 
individuals that you are going to try and help.
    I often feel a lot better about helping to solve problems 
when I can personally do something, I can get involved in some 
way to make something happen. And I think we have identified a 
number of things.
    Let me just say to the Hotel Association here, we do not 
intend to have anybody placed on the streets by FEMA because 
they cut off payments to the hotels and we do not intend to 
have you in a position where FEMA is abandoning the tenants and 
you have to put them out. I think that is an untenable position 
to be in. And given all that you have done, if FEMA continues 
the payments, as they will, we are going to have to make sure 
they do that. We ask that you bear with us as long as you 
possibly can to get people transferred into either transitional 
housing or permanent housing. So I appreciate what you have 
shared with us today.
    That is on our radar screen and that is what the 
Congressional Black Caucus met with FEMA about before we left 
and we did make it clear to them that we do not intend to have 
anybody to be put on the streets with these deadlines that do 
not make good sense to us.
    All of you have given us some very, very valuable 
information. Some other things that I think we could do very 
quickly is, if FEMA is supporting a racist website, we are 
going to deal with that right away. They have no business 
having their names in support of any racist website that is 
advertising, you know, apartment rentals under those kinds of 
conditions. Things that we can try to do right away.
    We have heard more than once today, and I am glad that you 
are bringing it to our attention because we are the Housing 
Committee, that FEMA is not capable or competent to handle the 
housing needs of this community. And so I hope that--this 
discussion has been raised before, Mr. Chairman, about whether 
or not HUD should be the agency that is doing the housing, that 
is taking care of the housing. We are going to have to find a 
way to revisit this and see if we cannot only respond to what 
we hear, but what we really know also about how to start to 
deal with these housing needs.
    I guess there are several other issues that have been 
raised here today as far as Mr. Schedler has identified the 
need for looking at how to rebuild these units, how to do it 
quickly, how to have a one stop shop; how to get rid of some of 
the onerous requirements, all of that. I would think that 
giving the so-called appreciation for the needs of the business 
communities like so many Members of Congress that this should 
be done in the State and the local government, et cetera, right 
away.
    I appreciate all the non-profit agencies and Catholic 
Charities and others and the Salvation Army who are feeding the 
people every day, who are taking care of the homeless and all 
of that. And I appreciate you doing it without the resources 
that this Government should be providing for you to do it.
    Now having said some of that--and I cannot say everything 
that I am feeling right now--I am probably going to have a lot 
of sleepless nights. This business of who gets the assistance 
of local government and the requirements of local governments 
about what areas may be rebuilt based on, as Mr. Jefferson 
describes it, who raises their hand is absolutely ridiculous, 
outrageous, and cannot be tolerated.
    And I just have to say to you, while I am a legislator and 
a Member of Congress with the responsibility for public 
policy--I am an activist and an organizer. I may do that better 
than even legislating. And if it takes me connecting with many 
of the activist organizations around the country to come back 
into the communities and help them raise their hands under this 
ridiculous requirement, Mr. Jefferson, I just tell you that 
many of us will dedicate our time to doing that.
    If New Orleans wants to be the focal point for national 
activism, then let it be. We had some activists in the audience 
today who come from a lot of different communities around this 
country and I just tell you that many of them are going to 
leave here feeling the way that I feel, that maybe this whole 
Government is too slow. Maybe this whole Government does not 
care enough. Maybe this whole Government needs a kick in the 
behind.
    And so if it is going to take some national activism to 
help move public policy, just as the people empowered me to be 
a public policymaker, I feel like they also empowered me to be 
an activist and I do not mind doing it.
    So with that, I am not going to ask any more questions. I 
am not going to say anything else except to tell you all I am 
up to doing what has to be done. Okay?
    Thank you, very much.
    Chairman Ney. The gentlelady from California.
    Ms. Lee. Thank you very much. As we say in the House, I 
associate myself with the remarks of the gentlelady from 
California.
    But let me say to you today that this has been probably 
more devastating than most of us had in mind and, in fact, I 
agree with Congresswoman Watson; Every member of Congress needs 
to come down here, every Member, because every committee has 
some jurisdiction over an effective and immediate response.
    Secondly, much of what you shared today, I did not know, 
for example, what Ms. Lewis said about the food stamp issue and 
guaranteed I will go back and we are going to look at that. I 
assume all of you know that in fact once a displaced resident 
gets the $2000 from FEMA, then they are ineligible for food 
stamps. That is really mind-boggling; I cannot believe that. 
Trust me, we will go back and look at how we can fix that, 
because to me that is probably one of the most inhumane 
policies that a government could promulgate under such dire 
circumstances.
    On the homeless issue, with regard to eligibility of the 
homeless for whatever assistance is out there, we are going to 
have to figure out where, first of all, the homeless are. You 
say there are about 2000 left right now here in New Orleans. 
But how do we find everyone? And then how do we make sure that 
if they did not have a place to live other than a shelter that 
they are eligible for the type of HUD assistance and FEMA 
assistance that they deserve. And you know, I am not sure how 
the rules impact those who were homeless and had to leave. So 
we are going to have to look into that and I look forward to 
working with you on that.
    Again, going back to the suicide rates and the mental 
health needs, these issues are directly related to housing and 
the hope that is out there in terms of the ability to return 
and not return. And we are going to have to figure out how to 
make sure that HUD or FEMA or whatever appropriate agency we 
can find, has the resources for mental health services because 
that is not disconnected from housing.
    And young people, in terms of their acting out, we are 
going to see a lot more. I know we are going to see safety 
issues; we are going to see serious long term mental health 
issues with children and with senior citizens and with others. 
So we are going to have to figure out how to work with the 
appropriate agencies to make sure that we can find--the money 
is there I know, but how we can redirect or direct money for 
the very severe mental health needs of individuals in this 
region.
    Finally, let me just say with regard to the discrimination 
and the racism, we saw that coming. We knew it and in fact in 
the CBC Bill, the Congressional Black Caucus Bill and the Baker 
Bill, we did put in the requirement that HUD redirect some 
resources to hire, you know, complaint officers and individuals 
to make sure the fair housing laws are complied with.
    I am not sure if people--I mean people who are displaced 
and just trying to get home, I do not know if they--and Mr. 
Perry, maybe you can answer this, if they are aware that they 
can file housing discrimination complaints and fair housing 
complaints or are they too bogged down right now with just 
survival to let it pass by if in fact they are treated in an 
unfair manner?
    Mr. Perry. I would submit that New Orleanians are aware of 
their rights under the fair housing rules because this 
organization, even before I lead it, did a good job at 
education and outreach in the New Orleans area.
    Ms. Lee. Good.
    Mr. Perry. Katrina evacuees who are not from the New 
Orleans area I think do not have the same opportunity. One of 
things that demonstrates though that New Orleans know is that 
about 75 percent of our complaints are coming from outside the 
New Orleans metro area. The New Orleanians who are in other 
parts of Louisiana who have been discriminated against call us 
and we will investigate the case.
    Ms. Lee. So the number of cases should increase with HUD's 
fair housing complaint division?
    Mr. Perry. Yes, I think so. I will be frank though; the 
biggest issue we have in this is that we do not have enough 
resources to adequately investigate all the cases.
    You may be familiar with the process that we go through to 
investigate fair housing. We do testing. So if an African-
American female calls in and says that she has been a victim of 
discrimination, then we will send an African-American female 
and a white female to that apartment to try to rent that same 
apartment and see if they are treated equally. And so we had a 
pool of about 50 testers who used to go out and do that testing 
for us. But they are dispersed all across America like everyone 
else. So we have had to retrain testers. We have to pay testers 
every time they go out and do these investigations. Instead of 
the investigations being right here in New Orleans, we are 
sending them to Shreveport and to Lafayette and very far 
distances and those are expenses that the organization has to 
incur. So it has been difficult to investigate.
    One other thing that has made it difficult is that there 
are loads and loads of unfair and improper evictions that are 
happening. And a lot of times, these evictions are not really 
discrimination issues; they are just frankly unfair or 
inappropriate evictions and sometimes they are fair and 
appropriate evictions. But people call us and say well, you 
know, fair housing. This is a housing issue and they may not be 
familiar with the fair housing laws. So we have to go through 
those hundreds of calls that we get to determine which ones are 
housing discrimination issues and which ones are really kind of 
landlord-tenant issues.
    Mr. Gable. If I may just add, Congresswoman, you know, in 
my case, the landlord went up $140.00 from the previous date, 
but I had to get a place to stay the week after and so it may 
not be on color. It might just be on cash.
    Ms. Lee. Gouging.
    Mr. Gable. You know, you just do it because you have no 
other place to take; it is two bedroom that is all you had 
available. I would suspect now that we are going into the sixth 
month and we have to re-up those leases; it is going to be much 
more. They are going to kick it up even higher because they 
know we have no place to go.
    Mr. Perry. I would add one more thing. In the case where 
landlords are upping the rents. One thing that we have seen is 
that there will be these low-income African-American complexes. 
Landlords will come in and try to get rid of all these low-
income African-Americans and try to move in new Katrina 
evacuees. And so to the extent that it affects mostly African 
Americans, it is a discrimination case.
    Now the fair housing law says you do not necessarily have 
to have intent, just the actual impact of discriminatory 
treatment. So there are some ways that those become cases, but 
that makes it so much more difficult with only two people to 
investigation.
    Ms. Lee. Sure. Thank you very much.
    Finally, let me just conclude by saying again, I just want 
to commend you for your service, your--really, everyone is 
going so far beyond the call of duty--and for your tenacity and 
steadiness. And just know that, as Congresswoman Waters said, 
many of us intend to work to make sure that what we feared 
initially in terms of the ripoff of New Orleans by developers 
quite frankly, I saw that and thought that could be a 
possibility, you could see million dollar condos going up where 
a $100,000 house had been because of some of the dynamics 
around gentrification and land grabs that we know could take 
place. But just know that many of us are on to that also and 
look forward to working with you as you move forward in this 
recovery process.
    Thank you very much.
    Chairman Ney. Thank you. Mr. Cleaver.
    Mr. Cleaver. Thank you, Mr. Chairman. I would like to just 
emphasize again what Reverend Gable said and take it just one 
step further. When Congress passes legislation or when we 
appropriate dollars for HUD--and this committee does that--we 
do not get involved in the regulations. The HUD infrastructure 
does that, the career bureaucrats. I think in this case we 
might need to have the Secretary come to our committee because 
of a couple of things.
    First of all, regulations require public hearings. The 
public hearings are, in most major cities, the most contentious 
meetings mayors conduct and for those of you who are here from 
New Orleans, you know it is usually packed to the walls and it 
is just the night that we have to deal with it. It is just the 
way it is. But if we ever have those hearings on a statewide 
basis, first of all, who do you notify and secondly who 
conducts the hearing? I can go on and on and on.
    The other part of it that is as equally disturbing is, 
there--we are not even sure that the regulations will require a 
30-day notice. There is some suggestion that maybe the 
regulations has been altered to 3 days.
    And then finally, this is one of the realities of America. 
In my State, there are two major cities, Kansas City and St. 
Louis. If we have to depend on the State to disburse CDBG 
money, we would lose; it is over. Not just in Missouri, in 
every major--in every State in the country, if it is in 
California--and the reason is simple, the majority of the 
members of the General Assembly come from the rural areas. And 
what you are going to have is a fight for $11.1 billion between 
New Orleans and those Mississippi small communities. And I 
cannot overstate, I do not think I am exaggerating the fact 
that this has been done in a way that is--people are almost 
going to go to fisticuffs. What is needed is an allocation for 
New Orleans based on the devastation, the disparity, the size 
of the community, the way that the CDBG budget is normally 
allocated. And then there ought to be the money disbursed in 
other areas.
    The other concern is members in other communities need to 
know that the Government is not supposed to say, we are going 
to give you this much money. And probably most of the people do 
not know that. That is, let us say for example in Mississippi, 
the Governor just says, okay, this community gets this much, 
that is not the way it is supposed to run. I do not think this 
committee can afford not to see what regulations have been put 
in place for the disbursement of this money. If we fail to do 
it, I think these people are going to be mad at somebody, and I 
just want you to remember my name, that I am the one that tried 
to stop it.
    Thank you.
    Chairman Ney. Ms. Watson.
    Ms. Watson. Thank you so much. And I again want to thank 
the chairman and the ranking member for coming here to the 
scene of the disaster and evaluating.
    And I just want to very quickly suggest some things that 
will summarize what I have heard today. First, we ought to make 
it possible for local government and for the mayor to know 
where his or her citizens are and we ought to have those lists 
released so that the footprint for New Orleans will not change.
    The next thing that I thought was an excellent suggestion 
is that we have the GAO to come in to review how to make the 
financing for temporary housing available, trailers, et cetera.
    The Section 106 rates need to be honored and the tax 
credits and grants for new housing need to be given and I think 
that the people who are without income because they are without 
jobs and they have nowhere to live need to be given special 
consideration for long term rentals and leases. It just does 
not make sense to me to put people who have suffered through 
this disaster through those hurdles.
    We need to increase the value of housing vouchers and we 
need to do something about the Katrina websites that have 
discriminatory messages on them. That is an outrage; it is 
illegal in terms of Government agencies and we can do something 
about that, Mr. Chairman, right now.
    SBA has never been an agency that I thought reacted 
effectively to loan applications and what I understand is SBA 
has turned down nine out of 10 loan applications for new 
housings. That is outrageous too. And HUD should handle housing 
financing. I think what we need, Mr. Perry, is an ombudsman 
process, where all these complaints like we heard today, and 
they are in many different categories, are heard and then 
directed where something can be done about them.
    I want to thank all of you who have testified today. And 
you have brought home to us the specifics that occur after 
disasters. You know, we get broad general reports in Congress; 
it is not until we get on the site to hear from those of you 
affected that we know the specifics. And thank you for coming 
and testifying, and I think we have most of your written 
testimony. And I trust the leadership of this committee that 
something will be done.
    And we certainly will be compiling the recommendations and 
approaching those agencies and the departments that can make a 
difference.
    So, again, thank you very much. And thank you, Mr. Chairman 
and ranking member for holding this hearing.
    Chairman Ney. I just want to make a brief statement and 
ask, since it is the district that you represent, I will ask 
you to close, as we say in the U.S. House.
    Just a technical thing, I want to note that some members 
may have additional questions for this panel which they may 
want to submit in writing. Without objection, the hearing 
record will remain open for 30 days for members to submit 
written questions to these witnesses and to place their 
response in the record.
    I think we could do a fair housing hearing in Washington; 
we could do a fair housing on Katrina. I think make it 
comprehensive, we can do that. I think it would be a good idea.
    The other thing I want to mention and not to single out 
Catholic Charities, but some of the first information we 
received on this was Catholic Charities and we found--on this 
whole situation down here in Washington, gave us great ability 
to tell us what was going on, where people were moving to, how 
everything was going. And we learn from groups frankly quite a 
lot and so I urge all of you if you have, some of the things we 
have discovered today, I think we can help with. Ms. Boyer has 
the four inch problem with the driveway, et cetera. Some of 
those things I think we can help with.
    As you have issues and something is not going right, do not 
assume we know. You can call us; you can call my office; you 
can call the ranking member's office, Mr. Oxley, Mr. Frank; we 
all share information. So please, if you have things, do not 
assume we already heard it.
    And I just want to again thank the Port Authority facility 
here and also our colleague Mr. Jefferson for helping us with 
this hearing and hosting us down here.
    Let me just say again, I cannot tell you, you know, how 
much--we all have worked with these issues, but also coming 
here and seeing it, things struck me today in the home we went 
into and I am assuming it was an older woman's home and on the 
wall was her daughter's graduation picture and next to it was 
Amazing Grace poster and the Last Supper. No one--she had to 
move so fast that she did not take the picture. You know, I 
have children. If you say what can you take, you know, you can 
take a few personal things, you would take the picture. I mean, 
and when you see that, it is just like their life stopped and 
now they are in a situation where they are in complete limbo, 
the people are. You have got a lot of brave people, people 
really fighting down here to help other people and I know from 
my end of it and I think I can speak for all members, this is a 
good hearing.
    I do not want you think we have not done our work; we have 
been doing it since day one together, screaming and fighting 
not with each other mainly, but to get answers from people. So 
this hearing though is good on the ground. Thank you.
    Mr. Jefferson, would you like to close.
    Mr. Jefferson. Thank you, Mr. Chairman. I cannot tell you 
how grateful I am to you and to Ranking Members Waters and to 
all of the committee members who have come here today, my 
colleagues in Congress; thank you so much for coming to pay 
attention and to shine the light on the subject that is so 
critical to all of us in this Nation. But for the people here 
in New Orleans it is their lives; it is everything to them.
    During this period of time when Members can travel to far 
away pleasant places when we are out of session and observe 
things that are less traumatic and less difficult than here, 
they have chosen to come here, which shows a great deal about 
their commitment and their passion and their interest in 
helping us to get through this.
    So I thank each of you again for fulfilling the, I think, 
more than any of you thought the objectives that we had in mind 
when we asked you to come. Now your having come gave you a 
chance to be close to our community. The worst and the most 
difficult challenges and of course the best of it in the people 
who have come to testify who you have had a chance to 
encounter. And I think it has been a brilliant display of an 
array of people from different walks of life who have made the 
case as to why we ought to rebuild our city, how we can rebuild 
our city, and the things that we must do to work together to 
get that done.
    From the ordinary citizens who have themselves been 
evacuees and who are still living as evacuees to the church-
based, faith-based communities that have done so much to help 
stand things back up here to the folks that are interested in 
keeping the historic character of our city together some sort 
of way and to those folks that are trying to build our city 
back through all the red tape and risk that is out there.
    And the issues that you talked about with the low income 
housing tax credit, we tried to make it as flexible and as 
large as we could this time. I read your testimony, and I see 
there are a few things here that we perhaps need to watch with 
our own State rules and work on that.
    And to the Hotel Association and Motel, it has been helpful 
to our people, I think, what Ranking Member Waters said. We 
need to give you a little certainty as to how you can help 
without burdening you too much, to make sure our people are in 
good shape.
    This issue about the State--FEMA has this business which I 
think we ought to try to figure out about how the State plan 
requirement works. FEMA does not want to deal with all these 
cities and school boards and parish governments; they say we 
are just going to deal with the State, which is why CDBG money, 
which ordinarily would come to an entitlement city like New 
Orleans, and some part of it goes to the State under this FEMA 
operated State plan. There is not much reason why we ought to 
do that. We have got the formulations there already; we ought 
to know how these things can be disbursed, except that it is 
going to be quite a challenge to get it out of the State. And 
it will be, it will not be so much Mississippi because we are 
going to get an allocation at some point that is just for 
Louisiana. But it will be the towns in Louisiana outside of 
here that will lay claim one way or another, for some reason or 
the other. Because you are in Lafayette, somebody will say we 
had an impact in Lafayette; forget about New Orleans; let us 
just bring some money there to take care of that local impact.
    So we have a lot of challenges here, but I am convinced 
that it is just a matter that is a matter of political will as 
to what choices we make. It is not what we can do. It is not 
what we cannot afford. It is none of those things. It is what 
we want to do to bring back this city, what our vision is for 
New Orleans and for this region, as I have said in my earlier 
testimony.
    So this I think helped us to advance the idea that we can 
pull our city back and make ourselves whole as well as we can 
with some folks we have already lost, but as whole as we can 
now, given the circumstances. So this could not be advanced 
without a committee willing to come out in the field as it says 
and hold a field hearing without the constraints of Washington 
that cuts the time so short and makes it so difficult to have 
discussions, do it out here with your people. This could not be 
done without your having come here.
    So thank you very much for what you have done, and thank 
you for your presentations. And we are grateful to everyone who 
has helped to make this project work out so well.
    Thank you very much.
    Chairman Ney. Thank you for your time.
    [Whereupon, at 7:40 p.m., the subcommittee was adjourned.]
                            A P P E N D I X



                            January 13, 2006
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