[House Hearing, 111 Congress]
[From the U.S. Government Publishing Office]





        POST-KATRINA DISASTER RESPONSE AND RECOVERY: EVALUATING
 FEDERAL EMERGENCY MANAGEMENT AGENCY'S CONTINUING EFFORTS IN THE GULF 
                 COAST AND RESPONSE TO RECENT DISASTERS

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

                                (111-12)

                                HEARING

                               BEFORE THE

                            SUBCOMMITTEE ON
    ECONOMIC DEVELOPMENT, PUBLIC BUILDINGS, AND EMERGENCY MANAGEMENT

                                 OF THE

                              COMMITTEE ON
                   TRANSPORTATION AND INFRASTRUCTURE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED ELEVENTH CONGRESS

                             FIRST SESSION

                               __________

                           FEBRUARY 25, 2009

                               __________

                       Printed for the use of the
             Committee on Transportation and Infrastructure









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             COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE

                 JAMES L. OBERSTAR, Minnesota, Chairman

NICK J. RAHALL, II, West Virginia,   JOHN L. MICA, Florida
Vice Chair                           DON YOUNG, Alaska
PETER A. DeFAZIO, Oregon             THOMAS E. PETRI, Wisconsin
JERRY F. COSTELLO, Illinois          HOWARD COBLE, North Carolina
ELEANOR HOLMES NORTON, District of   JOHN J. DUNCAN, Jr., Tennessee
Columbia                             VERNON J. EHLERS, Michigan
JERROLD NADLER, New York             FRANK A. LoBIONDO, New Jersey
CORRINE BROWN, Florida               JERRY MORAN, Kansas
BOB FILNER, California               GARY G. MILLER, California
EDDIE BERNICE JOHNSON, Texas         HENRY E. BROWN, Jr., South 
GENE TAYLOR, Mississippi             Carolina
ELIJAH E. CUMMINGS, Maryland         TIMOTHY V. JOHNSON, Illinois
ELLEN O. TAUSCHER, California        TODD RUSSELL PLATTS, Pennsylvania
LEONARD L. BOSWELL, Iowa             SAM GRAVES, Missouri
TIM HOLDEN, Pennsylvania             BILL SHUSTER, Pennsylvania
BRIAN BAIRD, Washington              JOHN BOOZMAN, Arkansas
RICK LARSEN, Washington              SHELLEY MOORE CAPITO, West 
MICHAEL E. CAPUANO, Massachusetts    Virginia
TIMOTHY H. BISHOP, New York          JIM GERLACH, Pennsylvania
MICHAEL H. MICHAUD, Maine            MARIO DIAZ-BALART, Florida
RUSS CARNAHAN, Missouri              CHARLES W. DENT, Pennsylvania
GRACE F. NAPOLITANO, California      CONNIE MACK, Florida
DANIEL LIPINSKI, Illinois            LYNN A WESTMORELAND, Georgia
MAZIE K. HIRONO, Hawaii              JEAN SCHMIDT, Ohio
JASON ALTMIRE, Pennsylvania          CANDICE S. MILLER, Michigan
TIMOTHY J. WALZ, Minnesota           MARY FALLIN, Oklahoma
HEATH SHULER, North Carolina         VERN BUCHANAN, Florida
MICHAEL A. ARCURI, New York          ROBERT E. LATTA, Ohio
HARRY E. MITCHELL, Arizona           BRETT GUTHRIE, Kentucky
CHRISTOPHER P. CARNEY, Pennsylvania  ANH ``JOSEPH'' CAO, Louisiana
JOHN J. HALL, New York               AARON SCHOCK, Illinois
STEVE KAGEN, Wisconsin               PETE OLSON, Texas
STEVE COHEN, Tennessee
LAURA A. RICHARDSON, California
ALBIO SIRES, New Jersey
DONNA F. EDWARDS, Maryland
SOLOMON P. ORTIZ, Texas
PHIL HARE, Illinois
JOHN A. BOCCIERI, Ohio
MARK H. SCHAUER, Michigan
BETSY MARKEY, Colorado
PARKER GRIFFITH, Alabama
MICHAEL E. McMAHON, New York
THOMAS S. P. PERRIELLO, Virginia
DINA TITUS, Nevada
HARRY TEAGUE, New Mexico

                                  (ii)







 Subcommittee on Economic Development, Public Buildings, and Emergency 
                               Management

        ELEANOR HOLMES NORTON, District of Columbia, Chairwoman

BETSY MARKEY, Colorado               MARIO DIAZ-BALART, Florida
MICHAEL H. MICHAUD, Maine            TIMOTHY V. JOHNSON, Illinois
HEATH SHULER, North Carolina         SAM GRAVES, Missouri
PARKER GRIFFITH, Alabama             SHELLEY MOORE CAPITO, West 
RUSS CARNAHAN, Missouri              Virginia
TIMOTHY J. WALZ, Minnesota           MARY FALLIN, Oklahoma
MICHAEL A. ARCURI, New York          BRETT GUTHRIE, Kentucky
CHRISTOPHER P. CARNEY, Pennsylvania  ANH ``JOSEPH'' CAO, Louisiana
DONNA F. EDWARDS, Maryland           PETE OLSON, Texas
THOMAS S. P. PERRIELLO, Virginia
JAMES L. OBERSTAR, Minnesota
  (Ex Officio)

                                 (iii)









                                CONTENTS

                                                                   Page

Summary of Subject Matter........................................    vi

                               TESTIMONY

Garratt, David, Acting Deputy Administrator, Federal Emergency 
  Management Agency..............................................    10
Logsdon, Gary, Grayson County Judge/Executive....................    45
Rainwater, Paul, Executive Director, Louisiana Recovery Authority    10
Stark, James W., Assistant Administrator, Gulf Coast Recovery 
  Office, Federal Emergency Management Agency....................    10
Wilder, H. Rodger, Immediate Past President, Gulf Coast Community 
  Foundation.....................................................    45

          PREPARED STATEMENT SUBMITTED BY MEMBERS OF CONGRESS

Carnahan, Hon. Russ, of Missouri.................................    62
Markey, Hon. Betsy, of Colorado..................................    63
Norton, Hon. Eleanor Holmes, of the District of Columbia.........    65
Oberstar, Hon. James L., of Minnesota............................    68
Scalise, Hon. Steve, of Louisiana................................    70

               PREPARED STATEMENTS SUBMITTED BY WITNESSES

Garratt, David and James W. Stark................................    72
Logsdon, Gary....................................................   106
Rainwater, Paul..................................................   108
Wilder, H. Rodger................................................   123

                       SUBMISSION FOR THE RECORD

Garratt, David, Acting Deputy Administrator, Federal Emergency 
  Management Agency, response to request for information from the 
  Subcommittee...................................................    84

                        ADDITIONS TO THE RECORD

State of Louisiana, Office of the Governor, letters of appeal to 
  the President of the United States.............................   128



 
  HEARING ON POST-KATRINA DISASTER RESPONSE AND RECOVERY: EVALUATING 
 FEDERAL EMERGENCY MANAGEMENT AGENCY'S CONTINUING EFFORTS IN THE GULF 
                 COAST AND RESPONSE TO RECENT DISASTERS

                              ----------                              


                      Wednesday, February 25, 2009

                  House of Representatives,
    Committee on Transportation and Infrastructure,
Subcommittee on Economic Development, Public Buildings, and 
                                      Emergency Management,
                                                    Washington, DC.
    The Subcommittee met, pursuant to call, at 10:00 a.m., in 
Room 2167, Rayburn House Office Building, the Honorable Eleanor 
Holmes Norton [Chairwoman of the Subcommittee] presiding.
    Ms. Norton. We are pleased to welcome our witnesses to this 
second hearing devoted to our post-Katrina evaluation of the 
Federal Emergency Management Agency, or FEMA, to assess FEMA's 
progress as the Nation's only disaster response agency.
    We will examine progress not only in Louisiana and 
Mississippi, where FEMA's failings have been documented by our 
Subcommittee and many others, but also in Texas, which recently 
saw major damage from Hurricanes Gustav and Ike, and in Grayson 
County, Kentucky, declared a major disaster county by President 
Obama after recent ice storms devastated the midsection of our 
Country.
    Hurricane Katrina was a disaster of mammoth proportions, 
but its major lesson went well beyond its scope and uniqueness 
and the failures of FEMA in 2006. Katrina teaches that FEMA 
must be nimble enough to move quickly before and after any 
Stafford Act emergency or disaster.
    The Country cannot be assured that FEMA is always prepared 
without frequent oversight by our Subcommittee which began in 
the 110th Congress. Gustav, Ike and this year's ice storms all 
provide markers by which to measure FEMA's progress and 
disaster response and recovery agencies.
    We want to look at outstanding issues in Louisiana, Texas, 
Mississippi and Kentucky. In Louisiana, there are still public 
assistance projects awaiting disposition by FEMA. In Texas, 
there are continued challenges with remaining storm debris and 
with providing housing in the coastal areas. In Kentucky, 
although initial reports seemed to indicate a satisfactory 
response by FEMA, we need to understand the expectations 
concerning FEMA's assistance to local counties and whether they 
were indeed met in Kentucky and throughout the Midwest.
    Today, we will be particularly interested in FEMA's 
housing, in rebuilding public infrastructure and in case 
management services during the three plus years of recovery in 
Louisiana since Katrina.
    We remain particularly concerned about the backlog of large 
infrastructure projects that have been delayed in the aftermath 
of Katrina. The Sewage and Water Board of New Orleans' main 
facility, an essential component of city infrastructure, of any 
city anywhere, is still not protected after the disaster 
because of protracted negotiations over the definition of 
mitigation.
    Whatever the legitimate differences between Louisiana and 
FEMA, there is no excuse for failure to devise a way to come to 
agreement, to use millions upon millions of available funds 
that have been appropriated by this Congress to repair an 
essential part of the New Orleans infrastructure which remains, 
as a result, vulnerable to natural disaster today.
    Moreover, there are many public assistance infrastructure 
issues in municipal systems across the State still waiting on 
FEMA and an agreement to proceed. The rebuilding of Charity 
Hospital, an essential part of the New Orleans health 
infrastructure, and the rebuilding of the criminal justice 
infrastructure in New Orleans are stalemated.
    Why have projects of great priority stalled or slowed for 
all these years?
    Why does Louisiana currently have 4,135 projects determined 
to be in dispute due to excessive delay, overt disagreement or 
other factors with 2,894 of these projects currently valued 
between $55,000 and $500,000 for a total value of approximately 
$500 million and 1,241 projects currently valued at an amount 
over half a million dollars for a total of--listen to this 
amount--$3.7 billion waiting for somebody to come to an 
agreement about how to spend it and not getting to the people 
of the State?
    We note that some of these projects are likely shovel-ready 
and amount to a huge amount of already appropriated money in 
stimulus funds for the State of Louisiana. It is unconscionable 
to allow these projects to wait while at the same time we are 
sending new stimulus funds to the States including Louisiana 
while these major projects could be putting people to work now 
on the most vital infrastructure for the State.
    This backlog of 100 percent federally-funded projects is so 
serious that out of justifiable outrage at years of stalemate 
Senator Mary Landrieu inserted into the stimulus bill a binding 
arbitration clause for FEMA projects over $500,000 to expedite 
the recovery efforts from Hurricanes Katrina and Rita in the 
Gulf Coast Region.
    Although the new binding arbitration requirement raises 
other issues that would likely cause further delay, I am 
working with Senator Landrieu on a good compromise that I 
assure you will emerge soon. We will not tolerate this another 
month.
    At the same time, we see some successfully completed 
infrastructure projects such as the New Orleans Police 
Department headquarters. However, with such clear deficiencies, 
such terrible delay, it is particularly disappointing that the 
Senate itself did not act on H.R. 3247 in the 110th Congress 
which contained provisions that specifically addressed many of 
the public assistance and infrastructure problems.
    For example, the bill authorizes the FEMA Administrator to 
include Gulf Coast recovery efforts under the Public Assistance 
Pilot Program authorized by the Post-Katrina Emergency 
Management Reform Act, and H.R. 3247 permits the use of third 
parties to review and expedite public assistance appeals and 
allows FEMA to use simplified procedures under which small 
projects are permitted to proceed on estimates for projects up 
to $100,000.
    With more than $3 billion in projects held up by disputes, 
however, the time for pilot projects is over. We will require a 
third party dispute resolution within the government for FEMA 
that we believe will meet the challenges and the concerns of 
all involved.
    In June of last year, we had hearings on Mississippi which 
is still recovering from Hurricane Katrina as well and is 
working with FEMA to replace and repair public infrastructure 
and to address mitigation issues for any new construction along 
the Gulf Coast.
    Mississippi also had service management problems for 
disaster victims. According to the U.S. Census, when Hurricane 
Katrina made landfall, Mississippi had the highest poverty rate 
in the United States, only increasing the necessity and 
importance of recovery services.
    We need to know whether Mississippi is now meeting the many 
challenges that were laid out in our previous meeting and 
whether FEMA has been instrumental, as required, in helping the 
State to meet those challenges.
    At the Mississippi hearing, the Subcommittee received 
compelling testimony from case managers and service providers 
concerning FEMA's recovery efforts in areas of Mississippi that 
lost city halls, fire stations and schools. In many areas, most 
standing structures were reduced to concrete slabs.
    I flew over the affected Mississippi counties shortly after 
Katrina and saw firsthand large areas that quite literally had 
been blown away.
    At our June hearing, we learned of systemic contracting 
problems. Again, here, they arise in Louisiana, again going 
back to Hurricane Katrina and again hampering recovery efforts 
in Mississippi as I have just described in Louisiana.
    Congressman Bennie Thompson of the State called for 
``mechanisms of dispute resolution for contracts.''
    Congressman Gene Taylor reminded us, also of Mississippi 
and the Member whose district was particularly struck by 
Katrina, reminded us of the necessity for timely payments and 
keeping the Nation's word.
    Long-term housing needs and solutions continue to stymie 
both FEMA and HUD.
    We must crack this structural problem FEMA apparently has 
everywhere with appropriated dollars tied up, stalemated and 
unspent and the failure, therefore, to meet the needs of 
disaster victims as mandated by Congress. That is why we are 
developing a required third party resolution within the 
government to break this open and free these billions of 
dollars for the people of Mississippi and Louisiana.
    I am, frankly, outraged to hear that there is this much 
money piled up over so many months, and nobody from FEMA has 
come to this Committee with anything approaching a question, 
much less a solution, to these funds.
    We are especially anxious also to get an understanding of 
FEMA's efforts in Kentucky after the ice storms. Speaker Nancy 
Pelosi, Chairman Jim Oberstar and I met with Midwestern House 
Members during the ice storms this month to see how we could be 
more helpful. Kentucky and the Midwest will continue to receive 
this attention from the leadership of the House, our Committee 
and this Subcommittee.
    Again, we thank our FEMA representatives and witnesses from 
Louisiana, Mississippi and Kentucky for preparing testimony 
today to help the Subcommittee continue to ensure that the 
Agency is up to the challenge of meeting disasters anytime, 
anywhere in our Country.
    I am pleased to ask our Ranking Member, Mr. Diaz-Balart, if 
he has any opening remarks.
    Mr. Diaz-Balart. Thank you, Madam Chairman.
    Let me first thank you for holding this important hearing 
today on disaster response and recovery and to evaluate FEMA's 
continued efforts in the Gulf Coast and, frankly, their 
response to recent disasters. Again, I want to thank you for 
your leadership.
    As a Member representing the State of Florida, 
unfortunately, we are a State that sees a lot of hurricanes, 
and so I appreciate the important role that FEMA plays in 
disaster response and recovery.
    Now when State and local resources are, frankly, 
overwhelmed and communities are just trying to figure out how 
to recover and rebuild from a major disaster, FEMA is the one 
that provides the resources and expertise that help those 
communities get back on their feet and try to continue to 
evolve and prosper. FEMA plays a crucial role in disaster 
response and recovery. That is exactly why FEMA must be quick 
and nimble, as the Chairwoman said, and lead Federal response 
and recovery efforts on behalf of the President of the United 
States.
    Following Hurricanes Katrina and Rita, we saw serious 
problems with FEMA's preparations, their response and their 
recovery, among other problems as well not only of FEMA, but we 
are dealing with FEMA today.
    Now there have been improvements since we passed the Post-
Katrina Act. There are still deeper problems that still 
persist, I think. The sluggish decision-making created by 
FEMA's lack of autonomy, I think, undermines its mission. So, 
whether FEMA remains under DHS or not, its autonomy clearly 
must be strengthened.
    FEMA is buried in this large department that has, I think, 
eroded its ability to be quick and to be agile and nimble, and 
this has resulted in unnecessary delays that impact the States 
and the communities that count on FEMA's assistance after a 
disaster.
    It has been more than three years since Katrina and Rita 
hit the Gulf Coast, and many of those communities, as the 
Chairwoman has just stated, particularly in Louisiana, are 
still struggling to recover from those disasters. We know that 
that is going to take some time.
    And since that time, there have been other disasters 
including Hurricanes Ike and Gustav and the recent ice storms 
that impacted Kentucky and a number of other states.
    Now the ice storms, by the way, are something that as a 
Floridian we do not have a lot of experience.
    Ms. Norton. That is all you don't have.
    Mr. Diaz-Balart. That is right. Exactly as the Chairwoman 
says, that ice storms are probably the only disaster that we 
don't have in Florida.
    But they left more than 700,000 homes and businesses in 
Kentucky without power, and ice-encrusted debris prevented many 
of those rural areas from even seeking assistance. So this ice 
storm is considered the worst natural disaster in the history 
of Kentucky, and I can only imagine its scope.
    Now I am pleased to see that Judge/Executive Gary Logsdon--
I don't know if I pronounced your name, sir. With a name like 
Diaz-Balart, I should be able to deal with yours rather easily.
    But from Grayson County, Kentucky, he is with us here 
today. He will provide this Committee with his input and 
observations regarding FEMA's response and recovery, and I know 
that Mr. Guthrie will be introducing him later on. So thank 
you, sir.
    I understand that he has been the chief executive of this 
county for some time and should be able to provide us with key 
insight into this topic as I am sure that ice storms are not 
the first disaster that his county has had to deal with, but I 
understand it is the largest one in the State's history. So, as 
a Floridian, I am actually very interested in learning 
something absolutely new for me.
    When FEMA was transferred into the Department of Homeland 
Security, it was unfortunately stripped of many of its 
functions and authorities. The failed response to Hurricane 
Katrina was an unfortunate and yet, I would probably say, 
predictable consequence of FEMA's diminished capabilities.
    Following Katrina, this Committee and the Select Katrina 
Committee conducted a full investigation and a review of the 
government's preparations for the response of Katrina, and in 
2006, as a result of those investigations, we drafted and 
passed into law the Post-Katrina Emergency Management Reform 
Act to improve the government's response to all types of 
disasters, not just hurricanes.
    While many of those provisions have been implemented, many 
have not, including very key provisions like HSPD-8, HSPD-5 and 
the National Response Framework have yet to be revised to 
reflect the changes mandated by this legislation that I just 
spoke of. So, again, inconsistent policies and slow decision-
making are just some of the symptoms of the problems that we 
have with the bureaucracy because FEMA is buried into this huge 
DHS department.
    Hurricanes Ike and Gustav were the first real tests 
following the reforms, the first real tests for FEMA following 
those reforms, and it is clear that there have been some 
improvements. I would say many improvements in FEMA's response. 
However, there were still areas, such as transitional housing, 
that clearly need further work.
    Now, unfortunately, after the aftermath of Katrina, we can 
still see that there are many years, many years still I guess 
or a lot of things that still have to be fixed, and there are 
things, and the Chairwoman talked about that extensively and in 
great detail. I think we all share her sense of I don't know if 
the right word is frustration or indignation or just lack of 
patience.
    While FEMA's Direct Housing Assistance Program and HUD's 
Disaster Housing Assistance Program have been extended, there, 
frankly, is no real strategy that has been developed to address 
the long-term housing issues in Louisiana.
    In addition, earlier this month, Ranking Member Mica hosted 
a roundtable requested by Congressman Cao of Louisiana on the 
ongoing problems with the public assistance programs and 
billions of dollars of delayed public infrastructure projects. 
The Chairwoman was talking about that a little while ago. So I 
hope FEMA can update us today on the efforts to speed these 
projects up.
    By the way, Representative Cao is not here because he is in 
the hearing in Homeland Security where the Secretary of 
Homeland Security is testifying.
    The Chairwoman also mentioned that the Senate was 
successful in including language in the recent stimulus bill 
that would require binding arbitration to settle these 
disputes. As the Chairwoman also said, that provision does 
raise some serious issues, maybe some legal issues and policy 
implications.
    So I am hopeful that a solution can be found. I am very 
optimistic that it will be found. I know that the Chairwoman, 
as she stated, is looking at that aggressively, trying to come 
up with a solution to free up much needed assistance to the 
State and to local communities in Louisiana.
    The overarching issue, obviously, is that we must ensure 
that FEMA has the necessary authority, the tools, the resources 
and the nimbleness to effectively and efficiently carry out its 
vital mission, obviously, that we all depend on. To the extent 
that there are problems, we must work together to identify them 
and to find real workable solutions.
    FEMA's mission is so critical. It is critical to saving 
lives and rebuilding devastated communities recovering from 
major disasters. So, obviously, when FEMA fails, everybody 
loses, the whole Country loses.
    So I look forward to hearing from the witnesses on these 
and other issues.
    At this time, Madam Chair, I would respectfully ask 
unanimous consent that a written statement submitted by 
Representative Scalise of Louisiana be entered into the record.
    Ms. Norton. Without objection, so ordered.
    I will ask now if any Members have any opening remarks.
    Mr. Shuler of North Carolina?
    Mr. Shuler. Madam Chair, I don't have any comments at the 
moment right now.
    Ms. Norton. Ms. Markey.
    Ms. Markey. Yes. Thank you, Madam Chair.
    I am very glad that we are here today to discuss and 
evaluate FEMA's efforts in the Gulf area.
    I have witnessed the importance of FEMA's funding in my own 
district. Last May, a tornado struck in the town of Windsor, 
Colorado. The tornado was a mile wide at times and damaged 
nearly 1,000 homes.
    FEMA offered assistance that included grants for temporary 
housing and home repairs, low cost loans to cover uninsured 
property losses and other programs to help individuals and 
businesses recover from the effects of the disaster.
    Representing a district that has also experienced a natural 
disaster, I have glimpsed tragedy albeit on a different scale. 
We have a responsibility to help people whose lives were 
destroyed by these storms, and I look forward to hearing about 
the progress that is being made in the region.
    Thank you.
    Ms. Norton. Thank you very much, Ms. Markey.
    Could I ask Mr. Guthrie if you have any opening remarks?
    Mr. Guthrie. Yes, ma'am. Thank you, Madam Chairwoman.
    I appreciate the opportunity to be here today and for this 
hearing and particularly, and I will introduce later, Judge 
Logsdon. And judge, in Kentucky, that is county, sometimes 
county judge like a county executive or a mayor of a county. We 
refer to him as judge. But I appreciate the opportunity.
    I will tell you, Madam Chairwoman, I bet I spoke a dozen or 
more times in the district work period, and every time I 
mention the meeting the Speaker hosted in her office and the 
fact that you were there and the fact that Chairman Oberstar 
was there and told the people that I represent that I believe 
this sped up the emergency declaration that came from the 
President because of the meeting and your cooperation. So I 
thank you for that, and it is important that we do work 
together on these issues.
    The ice storm, when you first think about it, as the 
Ranking Member said, what is an ice storm or how does it cause 
such a calamity? Well, just the weight of ice.
    In one area alone, the area that Judge Logsdon represents, 
there is a friend of mine who works for the electrical co-op, 
and over 1,700 electrical poles came down. Some areas in 
Congressman Whitfield's district, some utilities had 3,400 or 
more poles that came down.
    The debris, the trees that are everywhere, it took them six 
days to cut down a path to get to a lady's home, an elderly 
lady that was in a home. They went down to see that she was 
okay, but it took six days just to cut to her home.
    The thing about storms, though, you see the best in people, 
the local officials. The first couple of days when I got home 
from here, I went to Judge Logsdon's emergency operations 
center and others, and you saw sheriffs and judges and local 
officials and volunteer firemen. They were out day to day, 
helping neighbors, and everywhere you went churches would bring 
food to people, and you would see the local officials on the 
ground.
    I said, this just shows how good people can be to each 
other, and I just want to praise the people in our area for 
that.
    But it is devastating. When you think of hurricanes and you 
think of other issues, you see them more because it is not one 
limb at a time breaking over time that brings down all the 
power. It is just a full force all at one time.
    But it has been completely devastating. Our local officials 
have worked hard.
    And I just want to say again, and I will talk more when 
Judge Logsdon has the floor, but I just want to say, Madam 
Chairwoman, just how much it meant to us to work together.
    Now that I see the Chairman is here, Chairman Oberstar, I 
thank you from that meeting in the Speaker's office. I think 
that sped up the emergency declaration we had. I remember your 
comments specifically in that meeting were very helpful, and I 
shared them with people in my community.
    I want to appreciate that and look forward to Judge Logsdon 
on the next panel.
    Thank you.
    Ms. Norton. Thank you very much, Mr. Guthrie.
    In fact, the whole notion of ice storms I think illustrates 
just what FEMA has to be. You have to be able to go from the 
Gulf Coast and hurricanes to ice storms in a second. That is 
what we expect. It is what the American people expect.
    We have been graced by the Chair of the Committee, and I 
would certainly want to ask him if he has any opening remarks.
    Mr. Oberstar. Thank you, Madam Chair.
    I was, regrettably, as is always the case, dealing with 
other of the Transportation and Infrastructure Committee 
children, other Subcommittees' needs.
    I just want to express on behalf of Chair Norton and myself 
and, I expect, Mr. Mica and, very likely, Mr. Diaz-Balart that 
today I am going to be introducing a bill to reestablish the 
independence of FEMA as an effective, nimble response agency 
outside of the Department of Homeland Security, with a standing 
on its own as it once had when it was a very effective agency.
    Putting it in Homeland Security, Mr. Young, then Chairman 
of the Committee, and I vigorously opposed the idea in a 
meeting with the President.
    Mr. Shuster, former Chairman of this Committee, vigorously 
opposed tampering with FEMA. He found that it was a very 
responsive agency in his district and in his role as Chair and 
in other places in the Country.
    I actually am responsible for creating FEMA as such from 
the old civil defense agencies in the 1980s after a hearing, 
when I chaired the Subcommittee on Investigations and 
Oversight, and complaints from a wide number of Members on both 
sides of the aisle about the proposed regulation of the then 
Reagan Administration to reduce the Federal share to 25 percent 
in only a handful of cases and zero in most cases with a quaint 
parochial view that disasters are local in nature and don't 
have entail a national obligation.
    Republicans, Democrats, Federal agencies, State and local 
entities were furious about that.
    And after extensive hearings, then Ranking Member on the 
Committee Mr. Clinger of Pennsylvania and I, together, drafted 
a bill, and I gave the bill to the lead advocate who was not a 
Member of our Committee but a Member of the House to introduce 
and to be its advocate. He said, why me? I said, well, you have 
the guts to stand up to your own administration and advocate 
for a fair funding formula which we have crafted now in this 
legislation and that will be forthcoming in this new program 
that we will Federal Emergency Management Administration.
    Later, that Member of Congress became the first Secretary 
of Homeland Security, Tom Ridge. Now it is interesting how 
these things come full circle at times.
    I think in his heart Tom Ridge would have preferred that 
FEMA stay separate, but we are going to reestablish its 
separateness and its independent status and reaffirm what all 
of you practitioners at the local level know.
    This agency has to respond quickly. It has to be in concert 
with the community. It has to spring from the communities and 
has to understand and coordinate effectively. That is what we 
are going to do with this legislation.
    Thank you for your testimony today.
    Ms. Norton. Thank you very much, Mr. Chairman.
    Now Mr. Cao of Louisiana.
    Mr. Cao. First of all, I would like to thank Chairwoman 
Norton for holding this important hearing, for the continuing 
of this Subcommittee's attention to post-Katrina recovery 
especially in the Second Congressional District.
    And I would also like to thank today's witnesses from FEMA 
and from the LRA for being here to discuss their efforts with 
respect to the recovery needs of the Second Congressional 
District. I know that I have been pushing them in the last 
several weeks, and we have held several hearings prior to them 
being here. So I appreciate their being here again with respect 
to this hearing.
    I am also encouraged by President Obama's State of the 
Nation Address last night in which he focused on recovery, and 
I was encouraged by his campaign promises to make right the 
delays in rebuilding New Orleans.
    I am asking the President to keep to his commitments and 
was pleased by his action last Friday to extend a White House 
Office of Gulf Coast Recovery which is responsible for 
overseeing the rebuilding of those States affected by the 
storms of 2005 and since.
    And I recently came from the hearing just a few minutes ago 
with respect to the new Secretary of DHS, Secretary Napolitano, 
and I am encouraged by her emphasis on leadership and 
transparency especially with respect to FEMA.
    Based on some of the hearings and some of the 
investigations that we have been doing, I found that there is a 
lack of leadership and a lack of transparency with respect to 
the TRO office there in our district. I believe that some of 
this inefficiency, some of this lack of leadership and lack of 
transparency might be some of the main problems in the recovery 
process, the obstacles that we are facing, and I hope to 
address some of these issues to overcome these obstacles.
    With that, I would like to welcome the speakers, the 
witnesses for being here, and I give the floor back to the 
Chairwoman. Thank you very much.
    Ms. Norton. Thank you, Mr. Cao.
    Now let us move on to the witnesses.
    Let us hear first from the Acting Deputy Administrator, Mr. 
Garratt, then Mr. Stark of the Gulf Coast Recovery Office of 
FEMA and, finally, from Mr. Rainwater, the Executive Director 
of the Louisiana Recovery Authority.
    Mr. Garratt.

   TESTIMONY OF DAVID GARRATT, ACTING DEPUTY ADMINISTRATOR, 
FEDERAL EMERGENCY MANAGEMENT AGENCY; JAMES W. STARK, ASSISTANT 
 ADMINISTRATOR, GULF COAST RECOVERY OFFICE, FEDERAL EMERGENCY 
  MANAGEMENT AGENCY; AND PAUL RAINWATER, EXECUTIVE DIRECTOR, 
                  LOUISIANA RECOVERY AUTHORITY

    Mr. Garratt. Madam Chair, thank you.
    In the interest of time, I am going to forego opening 
remarks and defer to my colleague, Mr. Stark.
    Ms. Norton. Mr. Stark.
    Mr. Stark. Good morning, Chairwoman Norton, Chairman 
Oberstar--I guess he has left--Ranking Member Diaz-Balart and 
other distinguished Members of the Committee.
    My name is Jim Stark, and I am FEMA's Assistant 
Administrator for Gulf Coast Recovery. I am a career civil 
servant, having joined FEMA after a 28-year U.S. Coast Guard 
career. I have been a Gulf Coast resident for 12 years and have 
lived in New Orleans, Louisiana for the past 6. Thank you for 
inviting me to appear.
    I am joined today by David Garratt, Acting Deputy 
Administrator for FEMA. We are pleased to be here with you 
today to update you on our recovery efforts from Hurricanes 
Katrina and Rita and discuss our perspective on the long-term 
prospects for the Gulf Coast.
    As you know, in 2005, Hurricanes Katrina and Rita struck 
the Gulf Coast of the United States, causing unprecedented and 
catastrophic damage to property, significant loss of life and 
public infrastructure and the displacement of tens of thousands 
of people from their homes and communities.
    Nearly three and a half years after the hurricanes, the 
Gulf States continue to press forward and make progress toward 
recovery. The recovery is not without its challenges as the 
magnitude of these storms caused extraordinary level of 
destruction.
    FEMA continues to be an integral part of that recovery. Our 
recovery focus in the Gulf Coast is in the areas of individual 
and public assistance and hazard mitigation grant programs.
    Much has been said about the methods and ways in which FEMA 
has provided assistance across the Gulf Coast following the 
2005 hurricane seasons. In each of these areas, FEMA has seen 
successes and challenges.
    While we readily acknowledge that we could have done some 
things better, we must not lose sight of the fact that nearly 
three and a half years later, after the most damaging storms in 
American history, nearly 95 percent of those whose homes were 
impacted by the disaster have returned to their pre-disaster 
housing or have moved on to other long-term, permanent housing 
solutions, $10.5 billion has been obligated to Mississippi and 
Louisiana to rebuild public infrastructure and close to $500 
million has been obligated to Louisiana and Mississippi for 
hazard mitigation projects to lessen the impact of future 
disasters on those States' populations.
    FEMA's Individual Assistance Programs are at the forefront 
of our recovery efforts. Over the past three years, FEMA's 
Individual Assistance Program Specialists have worked hand in 
hand with voluntary and faith-based agencies as well as State 
and other Federal agencies to meet the needs of hundreds of 
thousands of people impacted by the hurricanes.
    Over the course of the disaster, FEMA housed more than 
143,000 families in travel trailers and mobile homes. The total 
number of households currently living in temporary housing has 
decreased to just over 6,600 with about 288 residing in hotels 
across the Gulf Coast. Every occupant residing in FEMA-provided 
temporary housing or hotels or motels has been offered an 
alternative, and we are working with each of them to find a 
permanent housing solution that meets their needs.
    The primary challenge for the Individual Assistance Program 
going forward is to work with those remaining families being 
housed by FEMA. Travel trailers and mobile homes are intended 
only as short-term emergency solutions to fill the need for 
housing. Clearly, FEMA and our Federal, State and local 
partners recognize how important it is both to those affected 
families and the communities in which they live to expedite the 
transition of these individuals into more permanent and stable 
housing.
    Another vital and visible component of a State's recovery 
is the Public Assistance Program. FEMA has been extremely 
active in working with the States and local governments to 
restore and rebuild public services and facilities.
    While there has been some deserved criticism of this 
program, it is important to note that, though funded by FEMA, 
the State administers the PA Program. Local governments and 
other eligible applicants receive their funding through grants 
managed by the States.
    FEMA has prepared a project worksheet for every project 
that the State and local governments have identified to us. 
Preparing the project worksheets and reaching agreement on the 
eligible scope of work and cost estimates is a collaborative 
process that requires attention to detail at each level: 
applicant, the States and FEMA. It often requires more time to 
complete than any of us would like.
    FEMA has obligated over $10.5 billion in public assistance 
to the Gulf States, $7.5 billion to Louisiana and $2.9 billion 
to Mississippi.
    Once obligated by FEMA, the States, as the grantee, control 
the pace of disbursements to the applicants. To date, Louisiana 
has disbursed $4.1 billion of that $7.5 billion. Mississippi 
has disbursed 1.6 of the $2.9 billion.
    There are sometimes disagreements between FEMA, the 
applicants and the State about the extent of disaster-related 
damages to facilities. Many of the facilities damaged by 
Katrina and Rita suffered from years of deferred maintenance 
and sometimes neglect. However, the Stafford Act only 
authorizes FEMA to reimburse applicants to repair disaster-
related damages.
    In some cases, FEMA must amend or prepare alternative 
versions of a project worksheet to revise the scope of work or 
cost estimate when more information becomes available 
pertaining to the repairs or replacement of those buildings. At 
the request of the State of Louisiana, FEMA developed and 
provides a system of ongoing versions during the life of a 
Public Assistance Project to help applicants with cash flow 
problems and to meet State and local contracting requirements.
    This process, jointly developed with Louisiana's Governor's 
Office of Homeland Security and Emergency Preparedness, was 
meant to speed the process and clearly delineate roles and 
responsibilities. However, it has become cumbersome and needs 
to change. Currently, we are tracking over 1,400 projects that 
require an amendment or version update.
    To assist us in accelerating the review process needed to 
verify the scope of work or a cost estimate, FEMA has suggested 
in our last meeting with Congressman Cao and others that a 
joint FEMA-State policy technical team review and make 
determinations together rather than conduct separate reviews of 
these version requests for completeness of information and 
eligibility.
    Hazard Mitigation Grant funding is made available to States 
following a disaster to fund cost-effective projects to 
mitigate against future disaster damages. This program is not 
designed for immediate response but as a long-term solution to 
reduce risk from flooding and other hazards.
    In Louisiana, over 1.4 billion is expected to be available 
under the Hazard Mitigation Grant Program for Hurricanes 
Katrina and Rita. FEMA has obligated $349 million in Federal 
funds for approved HMGP projects and State management costs 
thus far in Louisiana.
    In Mississippi, approximately $393 million in Hazard 
Mitigation Grant funding is available to the State. FEMA has 
obligated $150 million in HMGP funds to Mississippi.
    The Administration, the Department of Homeland Security and 
FEMA are committed to the recovery and rebuilding of the Gulf 
Coast. FEMA's Gulf Coast staff will remain an active and 
engaged partner until the job is finished.
    Through our Transitional Recovery Offices, we have 
highlighted many new initiatives that have contributed not only 
to the recovery of the Gulf Coast but have also contributed to 
the retooling and improvement of FEMA. These initiatives and 
our lessons learned will help to improve the effectiveness of 
FEMA's programs in future disasters.
    While finding housing for the many displaced households and 
repairing damaged and destroyed infrastructure has been and 
will continue to be a challenge, FEMA remains committed to 
providing or coordinating continued assistance to the victims 
of Hurricanes Katrina and Rita. Together with our Federal, 
State, local and voluntary agency partners, we will continue to 
pursue assistance solutions that will effectively and 
compassionately help individuals and communities recover and 
reestablish their way of life.
    I will be happy to answer questions now.
    Ms. Norton. Thank you, Mr. Stark.
    Mr. Rainwater.
    Mr. Rainwater. Thank you, Chairwoman Norton and Ranking 
Member Diaz-Balart.
    Chairwoman, I just want to say thank you on behalf of the 
citizens of Louisiana for all of the hard work you have done. 
You and I had actually spoken on the phone once when I was 
Senator Landrieu's legislative director, and I just wanted to 
say that your passion for Louisiana is known by many.
    I just want to say thank you and also to Congressman Cao 
for jumping into the fray so quickly. Your hard work is 
evident, sir, and we appreciate that as well.
    I also want to thank the Congress and the generosity of the 
American people for the money that they have invested in the 
State of Louisiana. We believe it is a good investment, and we 
are working hard to make that investment worthwhile.
    I want to talk to you just a little bit about the scale of 
the disaster and the reorganization, some progress that we have 
made and then some issues that obviously we will be talking 
about.
    I don't know of any other State that has suffered such 
destruction in the last three years or that faces as many 
complex rebuilding issues. In context, the combined impact of 
Hurricanes Katrina and Rita is the largest disaster in history. 
Measured only in terms of Stafford Act funds, it is larger than 
the next largest disaster which is the attack on America on 
September 11th, 2001, by 4 times and is larger than the 
remaining top 10 disasters combined.
    From Hurricanes Katrina and Rita alone, Louisiana has more 
than 1,400 unique applicants in the Public Assistance Program. 
There are another 700 applicants eligible for assistance as a 
result of Hurricanes Gustav and Ike which we are still 
recovering from.
    For Hurricanes Katrina and Rita, almost 22,000 individual 
projects have been identified as eligible for repair or 
replacement, and there have been more than 45,000 total project 
worksheets and versions written and obligated. The numbers are 
staggering as the process is staggering as well.
    In the State of Louisiana, when Governor Jindal took over 
in 2008, we looked at our processes and decided that we needed 
to reorganize. So the Governor appointed me as the Executive 
Director of the Louisiana Recovery Authority, the Executive 
Director of the Office of Community Development which manages 
all Community Development Block Grant money and also the 
Governor's Authorized Representative to the Federal Emergency 
Management Agency responsible for public assistance and hazard 
mitigation for a total budget of about $22 billion.
    What this did is it made one person responsible for the 
recovery because there was a point at which in the State of 
Louisiana there were three different organizations pointing 
fingers at each other and then back at FEMA and HUD. And the 
Governor said, no more.
    So now we have one person, myself, for better or for worse, 
who is responsible for the recovery in Louisiana, and I work 
with HUD and with FEMA to work through these issues.
    Now with the reorganization, we also looked at our 
processes and found that the State of Louisiana was taking 45 
to 60 days to pay out invoices through the FEMA Public 
Assistance process. It was taking too long. As you know, 
businessmen, have a 30-day billing cycle, and they need their 
payments quick.
    We looked at the process and worked very closely with FEMA 
to do this. Literally, now when an invoice comes from local 
government to the Governor's Office of Homeland Security and 
Emergency Preparedness, it takes between four and ten days to 
cut that check, and that has been an average. I check it 
weekly, and I brief the Governor on it about every seven days.
    We have actually put out about $708 million through that 
process.
    We also, in January of 2008, set about to reset our 
relationship with the Federal Emergency Management Agency. We 
were tired of the finger-pointing. We sat down in February and 
had a summit, went through 15 issues and wanted to work 
collaboratively with FEMA.
    I will tell you, Chairwoman, that we have had mixed 
results. There are things that we have made progress on, but 
there are many, many other things we have not, and one of those 
is scope alignment. The single biggest issue bogging down our 
recovery in Louisiana is the scope alignment process in the 
Public Assistance Program.
    It is the basic tenet of any construction project. That is 
in order to plan properly and ensure completion, you must know 
how much the project will cost and be able to provide adequate 
funding. This is common sense but not common practice for the 
FEMA Public Assistance Program, which more often than not 
undervalues project worksheets, leading to months of 
negotiations that widen the scope of work and write a new 
version of the project worksheet.
    While this process labors on, the applicant, a local or 
State government entity, can only move forward if he or she has 
the cash flow and willingness to risk doing the work for which 
FEMA may never ultimately reimburse the applicant. We have 
many, many examples, and when you hear the number, 4,000, that 
is what we are talking about.
    Now the most famous of these projects affected by scope 
alignment is the Medical Center of Louisiana at New Orleans 
commonly known as Charity Hospital. The State and FEMA have 
been actively engaged in negotiating the scope of eligible 
damages to the hospital for more than three years.
    Hurricane Katrina completely destroyed Charity, and until 
last month FEMA offered a paltry $25 million for repairs. After 
three and a half years, FEMA increased the funding for the 
project to $121 million but still fails to acknowledge the 
actual eligible damages to the facility itself.
    Another example is an African American university in New 
Orleans, southern University of New Orleans, where cabling of 
the electrical system had to be replaced campus-wide at the 
cost of approximately $3.3 million because the underground 
conductors of this low voltage system were submerged in salt 
water for three weeks.
    No professional, no contractor, no building inspector, 
including FEMA's electrical engineers, would certify an 
installation reusing the existing salt waterlogged cable. 
However, FEMA including its electrical engineer, refuses to pay 
for the obviously eligible project replacement.
    The threat associated with not replacing this system is 
enormous and obvious to anyone. So it is very difficult to 
understand why this work is considered ineligible since it was 
under water for three weeks and had salt water in it.
    In addition, FEMA has provided for a 1,500 student 
temporary facility. The current enrollment is 3,000.
    Another example is at Tulane University. The Howard Tilton 
Library is a government documents repository, and its repair is 
$30 million project to elevate the library that FEMA refuses to 
fund despite its own staff making the recommendation to pursue 
the elevation.
    The university went out and hired an architect and an 
engineer to do the work, and then later on the work was de-
obligated, meaning the university has to foot the bill. So all 
the documents remain in storage, and the library remains on 
temporary HVAC since Hurricane Katrina.
    The school also has partial or complete eligibility 
reversals on its Alumni House and the McAlister Auditorium.
    The issues we face in Louisiana are extraordinarily 
complicated with Hurricanes Katrina, Rita, Ike and Gustav. What 
we look for now is flexibility and a true partnership with 
FEMA.
    Now just several other matters, just very quickly: One of 
our biggest issues, obviously, is we are asking that the 
Federal Government look at the 100 percent Federal cost share 
for Hurricanes Gustav and Ike because no State has experienced 
such catastrophic losses in such a short period of time. Paying 
even a 10 percent match on these costs could stifle our 
recovery further.
    Granting Louisiana 100 percent Federal cost share for these 
storms would be a shot in the arm of our recovery and rid our 
State of the huge financial burden that we are currently 
working through.
    One other issue, the delay of the release of the flood 
plain maps in Louisiana, called DFIRMS, which Louisiana 
requested in December of 2008, FEMA is using these maps which 
have not been formally accepted to deny funds for Public 
Assistance Projects and further delay the recovery. Currently, 
we estimate that 45 infrastructure projects, including schools, 
have been de-obligated because of the DFIRM map issue, totaling 
a number of about $258 million.
    I do want to say this, Chairwoman. I do appreciate the 
partnership we have had and the progress we have made with 
FEMA. I have met numerous times with Dave Garratt, the Acting 
Administrator, and Jim Stark, our Regional Transition Office 
Director down in Louisiana, and I do appreciate them.
    We have attempted, since I have been here in January of 
2008, to quantify our issues with FEMA and sit across the table 
and work through them.
    But, as you know and as you hear from many, many, many 
applicants in Louisiana, there is an amazing amount of 
frustration on their part by the de-obligations that have 
occurred after universities, after local governments have gone 
out and spent money on projects just to have them de-obligated 
and, obviously, the frustration with the gap in funding between 
$1.5 billion and $2 billion to move those 4,000 project 
worksheets forward.
    Thank you, Chairwoman. I look forward to your questions.
    Ms. Norton. Thank you, Mr. Rainwater.
    I am going to begin asking questions. Many Members do want 
to come back and vote.
    I was interested, Mr. Garratt, although your testimony is 
joint with Mr. Stark and although the Disaster Directorate has 
the most hands-on, presumably, experience in how to manage 
recovery, that you chose not to speak to this issue. Would you 
like to speak to it?
    I mean that is what you were before you became the Acting 
Administrator. Isn't that the case?
    Mr. Garratt. Acting Deputy Administrator, ma'am, yes, I was 
the Deputy Assistant or am the Deputy Assistant Administrator 
for Disaster Assistance.
    Ms. Norton. Well, perhaps you can begin by telling us what 
you have done, what steps FEMA has taken in light of the more 
than $3 billion in projects that are held up in the State? What 
steps have you taken or are you taking to, in fact, allow those 
projects to proceed?
    Mr. Garratt. I will be happy to address that, Madam Chair.
    I paid very close attention to your opening remarks, and 
you mentioned several times the absence of a solution to deal 
with this backlog of Public Assistance Projects. You indicated 
that there was no excuse for the inability to come up with a 
way to resolve these outstanding issues.
    And I would in fact argue that there is a system and has 
been a system in place for many years for resolving Public 
Assistance issues. We call that our multilevel appeal process, 
and that multilevel appeal process is designed to, once and for 
all and authoritatively, resolve these issues so that they can 
move forward.
    Right now, even though there are some thousand or more 
projects that are said to be languishing in a state of limbo 
out there, we only have 31 appeals that are actually in our 
system that we are adjudicating right now.
    Ms. Norton. Mr. Garratt, in light of the billions of 
dollars stalled in the State, would you agree that that 
multilevel appeals process is not effective today to handle the 
major disaster issues in Louisiana?
    Mr. Garratt. By now means, Madam Chair. I would say, in 
fact, it has been extraordinarily successful when it is 
actually used. In fact, for the Gulf Coast States, for those 
appeals that have gone through our process, the appellants have 
enjoyed a nearly 40 percent approval rate on appeals that have 
gone through the process.
    Ms. Norton. So all we need to do is people who have some 
money waiting for them to simply file some papers.
    Mr. Rainwater, would you agree that the appeals process is 
effective in dealing with this money and that the present 
process is sufficient to the challenge?
    Mr. Rainwater. Chairwoman, thank you for your question.
    We worked very closely with FEMA to revamp the appeals 
process, and we appreciate their willingness to do that.
    The problem is that sometimes there is a lack of a decision 
to even get to an appeal, and that is where the dispute comes 
in. When you have numerous projects, worksheets that you are 
reversioning or looking at the estimated cost of, and you can 
never, you go back and forth in a process that never even gets 
you to a point where you are ready to appeal.
    Ms. Norton. Mr. Garratt, you have seen this yo-yo process. 
Have you ever questioned in your mind why so few of the issues 
get to the point of appeal?
    Has anybody in FEMA even considered another way to deal 
with this or begun to develop any new approaches in light of 
the large amount of money?
    Mr. Garratt and, for that matter, Mr. Stark, are you simply 
willing to let the amounts of money continue to pile up, now at 
more than $3 billion, until somebody in Louisiana gets his act 
together and appeals? Do you really think that is the problem, 
that is the source of the problem?
    Mr. Garratt. Madam Chair, the source of the problem is that 
both FEMA and the State, on a number of very complicated, very 
complex Public Assistance Project issues have honest 
disagreements about what is and what is not eligible.
    Ms. Norton. Let's stop right there because that I accept. 
That, I truly accept, that the government and the State would 
have disagreements. I would expect the State to want more, and 
you are supposed to be a good soldier with the government's 
funds.
    When you see impasse after impasse develop, do you think 
that the congressional mandate to proceed with these projects 
is in fact being recognized? I mean how many?
    Let me ask you because you seem to say your answer--Mr. 
Stark, is it your answer as well? I don't want to leave this 
only to Mr. Garratt.
    But it is your answer that until, because I want to hear 
this, until somehow the State of Louisiana finds a way to 
proceed even though there are differences that need to be 
worked out before you can appeal, is it your view that the 
present system is in fact sufficient to meet the challenge 
raised by the more than $3 billion outstanding that is hung up?
    Mr. Garratt. If what you are referring to, Madam Chair, is 
the recent legislation that required the establishment of an 
arbitration panel.
    Ms. Norton. I certainly am not. In fact, I made clear in my 
own testimony. As a lawyer, I can understand some of the issues 
involved there.
    We have to set up. The President has to set up a set of 
people to arbitrate, and I indicated to you that I am working 
on something to resolve that. But in order to resolve it, I 
have to get to what the problem is.
    Now your testimony is inconsistent with Mr. Rainwater, and 
I wanted you all at the table because I would like to reconcile 
this. Is it your testimony that no new mechanism?
    Leave aside binding arbitration. I believe that that is not 
the mechanism, and I don't even want to suggest what the 
mechanism is. I am looking for a mechanism.
    So I am asking you, are you satisfied with the existing 
appeals process as the mechanism to resolve this $3.4 billion 
that is stalemated or, if you are not satisfied with it, do you 
have any suggestions that we should take under advisement 
before we mandate upon the Agency how to resolve it, because we 
really are open? We are just flabbergasted. We are looking for 
ideas from those who are on the ground who have had to deal 
with this issue.
    Now if you are in denial about it, that is why you have the 
Senator putting in binding arbitration. Although I see problems 
with that, the problem remains how you are going to deal with 
the $3.4 billion, and I am open. If you have a way to deal with 
it, then I want to hear it because I don't want to jump forward 
with a way from Washington if there is a way that you are 
working right now to solve this problem.
    Mr. Garratt. Madam Chair, over time, over many disasters, 
the Public Assistance appeals process has worked and worked 
very well.
    It does take some time. Appellants have up to 60 days to 
submit an appeal. There is a 90-day period to review and 
adjudicate that on the first appeal level. Then they have an 
opportunity to re-appeal that.
    Ms. Norton. Mr. Garratt, I am going to take that as a yes, 
you are satisfied with the system because you are repeating.
    Mr. Garratt. Well, ma'am, if you don't mind.
    Ms. Norton. I mean Mr. Rainwater said--and you are not even 
speaking to the issue he raised--before you even get to the 
appeals, which is why he says there have been so few, there are 
certain steps that have to be taken, certain agreements that 
have to be made and he said they have not been made. Could you 
speak to that?
    Mr. Garratt. Madam Chair, the appeals process works. It may 
not work fast enough for everyone who is interested in a very 
quick decision. It is not designed to provide a very quick 
decision. It is designed to provided thoughtful, deliberate 
review of those appeals and come back with the right decision 
if that system is used, and any Public Assistance conflict in 
the field can be appealed at anytime.
    Ms. Norton. Look, thank you, Mr. Garratt.
    Is that your answer, Mr. Stark? Let me let you respond 
before I go to Mr. Rainwater.
    Mr. Stark. Yes. Thank you, Madam Chairwoman. I agree with 
Mr. Garratt on his description of the appeal process.
    What we try to do, however, prior to having to go to 
appeal, is to set up a process where we could resolve disputes 
having to do with scope alignments and cost estimating. We did 
that at the request of the State a little over a year ago in 
full recognition that in many cases some of our project 
worksheets were undervalued. There are some real good reasons 
for that, but regardless, if a project worksheet was 
undervalued, we needed to get to the right amount of money 
regarding the eligible work, the cost estimate and the scope of 
work, the scope of the contract to complete that eligible work.
    Unfortunately, what we haven't come to is a collaborative 
way to sit down at the table across from each other and work 
that out.
    What we have done is come up with our estimates, and we 
send them over to Mr. Rainwater and his staff, and his 
engineers look at them and then send them back over to us.
    My proposal is that we sit down with a group of technical 
experts--in fact, Paul and I came up with this together--
technical and policy experts to go through a prioritized 
listing and get through the 4,000, the 1,500, the 2,000, 
whatever the number may be quickly.
    Now let me also explain a little bit.
    Ms. Norton. Have you done any of that?
    Mr. Stark. We have not.
    Ms. Norton. Excuse me?
    Mr. Stark. We have not done that as of yet.
    Ms. Norton. I appreciate, Mr. Stark, that you at least have 
answered my question. I wasn't asking to be educated on the 
appeal process. I was asking why the decision itself, which 
would have to be appealed, was stalled.
    Mr. Rainwater, you heard both Mr. Stark and Mr. Garratt, 
and therefore I would like you now to respond to whether you 
think what Mr. Stark is suggesting is a viable way to move 
these, whether you agree with Mr. Garratt that the appeal 
process after all is a deliberative, thoughtful process. So 
what in the world do you expect? There are going to be delays.
    I mean I am a lawyer. I am used to delays in the process.
    So that is his answer.
    What is your answer?
    Mr. Rainwater. Chairwoman, if you bear with me just for a 
second, what I would like to do is go back and give you an 
example.
    I mean we have spent a lot of time in the State looking at 
our own processes, and one of those processes that we admitted 
early on that we had systemic issues with was our Road Home 
Program. Basically, it had a dispute resolution process, and it 
had an appeals process. We recognized at the State that the 
dispute resolution process was not working because you end up 
in an negotiation with a homeowner back and forth to a point 
where you could get nowhere.
    I got rid of the dispute resolution process, and I set up 
two appeals processes. I set up an appeals process at the 
contractor level with our contractor and then a State appeals 
process.
    And I also increased staff. Recognizing the large nature of 
what we were dealing with in our Road Home Program, we needed 
additional employees on staff and increase the number of 
decision-makers and decentralize it to a point where people 
could make decisions.
    What I have told the Federal Emergency Management Agency, 
Mr. Garratt and Mr. Stark and other senior leaders at FEMA and 
Homeland Security is that you have to look at the large, the 
scale of this disaster and the systems that we have designed, 
although they work great.
    I was an emergency manager back in the nineties, and I 
worked a flood in Lake Charles, Louisiana, where 50 homes were 
damaged. The Stafford Act works great there, and the processes 
work great, and FEMA works great in that particular situation.
    But this is so large and complex. What we have asked for is 
a system that looks very different than what we have right now 
because it is moving too slow, not at any fault of the people 
that are involved, but the design of the system and the design 
of the process itself just doesn't work.
    Ms. Norton. The system you are talking about involved 
individual homeowners.
    Mr. Rainwater. Individual homeowners, 70,000 cases of 
individual homeowners that we worked through. Last year, we got 
out literally 33,000 grants last year and had 25 outreach, not 
just outreach, work sessions where I brought policy people and 
operational folks together in a room out in communities with 
computers, laptops, policy manuals, and we worked through 
issues.
    Now not everybody is happy, obviously. As you know, Ms. 
Chairwoman, it is always difficult to work through some of 
those issues.
    I have asked FEMA. Jim and I have talked about doing this 
same thing. Let's get our operational folks together, our 
policy folks together, and let's go out and work with the 
applicants, one on one, just like we did with homeowners. We 
are talking about a lot less, obviously. It is about 1,400 
applicants.
    Go out to a mayor or parish president. Go to Tulane 
University where they are having the fight. Go to SUNO and get 
our folks to create a tiger team of policy and operational 
people who can work through these issues, case by case by case, 
and let's set a time line and a goal for ourselves to get that 
done and answer back to Congress about what we have been able 
to accomplish.
    Ms. Norton. I don't know. I am going to ask Mr. Cao if he 
has any questions.
    I can tell you this much. First of all, I absolutely 
applaud, Mr. Rainwater, your looking at the system and saying: 
Wait a minute. This doesn't work. I am in charge here. So why 
not try something else?
    Really, that is my complaint with FEMA, and I am not sure 
why that hasn't. They have looked at you have done and have 
approved it. I don't know why something that might fit this 
could not have been also developed.
    But I warn you that with binding arbitration already in the 
bill, this is not something we would have ourselves done, but 
we may be well past the time. There has been a loss of 
confidence.
    When the money gets that high and we are sending money out 
to the States, I am not sure we would have needed to send any 
money to Louisiana or certainly not very much.
    I am not sure that you would have agreement on the part of 
the Senate and, frankly, if it hadn't been started yet, I don't 
have much confidence based on the past record that somehow or 
the other there is going to be a system worked out that the 
Federal Government, namely FEMA, would agree.
    Mr. Cao.
    Mr. Cao. Thank you, Madam Chairwoman.
    I was wondering whether or not you can continue with the 
questioning for me to allow me to go vote, and I will be right 
back?
    Ms. Norton. Was it again a vote?
    Mr. Cao. Yes. There are two more series of votes. They are 
five-minute votes, each.
    Ms. Norton. We certainly would want you to have the 
opportunity, so not to worry.
    We are in a little dialogue here. If I sound spirited, I am 
not angry. I am looking for a solution. I have to say, the 
amount hits me in the face hard.
    Let me get down to some of the details. Let's take the 
estimates provided by the State for Charity Hospital where the 
analysis was provided by RSMeans, an estimator that apparently 
FEMA relies on often. Why did you, Mr. Garratt or Mr. Stark, 
you, FEMA, refuse to accept that estimate this time?
    Mr. Stark. Madam Chairwoman, we did look closely at the 
RSMeans estimates. We also looked at reports provided by the 
State of Louisiana regarding the condition of Charity Hospital 
both before and after the storm.
    Ms. Norton. Could I just stop you? Mr. Rainwater, would you 
have accepted the RSMeans estimate?
    Mr. Rainwater. Yes, ma'am. When we got here in January of 
last year, one of the things that the Governor and I decided we 
would do in working with LSU is to make sure that we had two 
good estimates. We had two done. One by RSMeans and one by 
Butch and Knievel, we accepted.
    In fact, we have had three studies done, three separate, 
independent studies done on Charity Hospital by engineers and 
architects that basically show us that the damage is beyond 50 
percent.
    Ms. Norton. As I say, I am trying to figure out. Okay. 
Louisiana would have accepted it, your guy. You don't accept 
it. Why?
    Mr. Stark. We don't because it is not estimating the scope 
of work to repair eligible storm-related damages. The estimates 
provided by RSMeans were to bring the hospital back to a level 
that it wasn't at before the storm and to repair other damages 
that weren't storm-related.
    Ms. Norton. Well, just a moment. You told them what to do.
    Mr. Stark. No. No, we did not. Our estimates are the one we 
accept. We did not tell them to do that estimate the way they 
did.
    Ms. Norton. So you didn't tell RSMeans. They were just 
looking at the overall damage?
    Mr. Stark. That is our position, yes, ma'am.
    Ms. Norton. But if they are your estimator.
    Mr. Stark. Well, anyone can estimate a scope of work once 
you tell them what that scope of work is.
    Ms. Norton. But don't you use them to estimate what the 
scope of damage is?
    I mean isn't that the whole point? Am I missing something 
here?
    Mr. Stark. I believe so, Madam Chairwoman, respectfully. I 
think the point is we have asked our estimators to estimate 
what it would cost to fix a certain scope of work, and that is 
the eligible storm-related damages.
    Ms. Norton. Let me stop you. Did you ask RSMeans to do that 
estimate?
    Mr. Stark. I am not sure if we used RSMeans for the initial 
estimate. I would have to check with that.
    Ms. Norton. Well, what is the point of RSMeans then?
    Mr. Stark. That is one of the estimators we use in a 
variety of projects. The State, I think they are right in doing 
this. Bringing up, bringing in an estimator whom we work with 
often and respect and understand is the right move, but I think 
they brought them a different package to estimate.
    Ms. Norton. Okay. So if you have different estimates and 
grown-up people here, how do you resolve that?
    Mr. Stark. Well, we are at the point now where we have 
looked through the three reports, one of which, by the way, 
recognized $158 million of pre-storm repairs that needed to be 
made to the hospital to bring it back to standards.
    We have looked at those reports, looked at those estimates, 
looked at our several walk-throughs of the building with our 
engineers and came up with the estimates that we have finally 
written in a project worksheet and presented to the State. That 
is the $150 million number that is now on the table.
    Ms. Norton. Mr. Rainwater, what is the status then with the 
State?
    Mr. Rainwater. Chairwoman, right now, I mean obviously we 
are working through our appeals.
    I mean there are a couple things I think. When we sat down 
and talked about, and literally what I have tried to do in each 
one of these programs that we run--there are about 26 of them--
is look at it and say, and the Public Assistance Program 
obviously is one and it is large, and look at it and say, okay, 
is there something wrong with what we are doing?
    So we hired RSMeans because we thought to ourselves, and I 
think it was logical, that this is the same estimator that the 
Federal Government uses to estimate damages and expenses in 
repairing a building. And so, we hired RSMeans, and then we 
hired another firm, Butch and Knievel to make sure that we had 
some sort of checks and balances in the system.
    We try to be very reasonable about the way we approach 
these issues, and we try not to be combative about it. We just 
want to provide information and do what is best for the State 
of Louisiana and the citizens of New Orleans in rebuilding 
Charity.
    So we hired RSMeans to take a look. They came back with the 
$492 million number.
    We are going to appeal the number. We don't agree with the 
Federal Emergency Management Agency's review of the estimations 
themselves. It brings up issues, for example, the failure to 
protect the facility after the storm. As many people know, the 
city was in disarray at the time and we were hit by two storms 
within three weeks, Katrina and Rita.
    Now FEMA did provide $20 million to the State of Louisiana 
to help them protect, to help us protect the facility, but that 
wasn't done until about six months later. So we had cash flow 
issues.
    There was damage caused by the storm that FEMA believes was 
deferred maintenance. Obviously, we disagree because LSU sent 
its facility plan and control folks into the building itself to 
look at it and saw mold and mildew building up in the system 
weeks after the storm had occurred.
    So we disagree with their assessment, and we are going to 
work through the formal appeals process. We are establishing 
the appeal in such a way that if we lose the appeal, LSU has 
said and our Office of Facility Planning and Control has said 
that we will go to court over the issue because it is a huge 
issue to the City of New Orleans and the rebuilding of the 
health care system in New Orleans itself.
    Ms. Norton. Precisely. See, I would expect that almost 
always, perhaps not always, but almost always the State and 
FEMA would disagree. When it comes to real money, there is 
going to be disagreement.
    Then the State is going to have to decide whether to 
appeal. Sometimes it will appeal, and sometimes it won't.
    I am concerned with the initial stage since I have been 
convinced by what you have said that the appeal process is 
okay, but something else must be wrong.
    Let me ask you, Mr. Garratt and Mr. Stark, was Charity 
Hospital more than 50 percent damaged by the storms?
    Mr. Stark. In our estimation, the answer is no.
    Ms. Norton. Mr. Rainwater, that is where the difference 
lies then, I take it.
    Mr. Rainwater. Yes, Chairwoman, that is where the 
difference lies.
    Ms. Norton. But this one is ready for appeal.
    Mr. Rainwater. Yes, ma'am, but it took us and it is an 
example because it took us three and a half years to get there.
    Ms. Norton. Yes, and it is a hospital.
    Mr. Rainwater. Yes, ma'am.
    Ms. Norton. Oh, heaven's help, it is a hospital, and that 
is what our concern is. You notice I am not asking as many 
questions about what appears to be going better, homes, even 
though there is a bureaucracy there.
    I am concerned about the basic infrastructure of the city, 
and I am concerned about another storm, frankly, and being 
caught with sewers and the like unstarted because of these 
appeals. There will be no patience in the Country for that, and 
that is why I am looking for a mechanism for an initial 
decision.
    I think the appeals, how long do they take, Mr. Garratt? 
How long does it? How would you estimate that an appeal itself 
would take?
    Mr. Garratt. I would say if it goes through both appeal 
levels, it will take approximately six months, maybe a little 
longer.
    Ms. Norton. Now, see, that doesn't bother me. Maybe it is 
because I am a lawyer, but it doesn't bother me in large part 
because of what Mr. Rainwater said, the nature of the beast you 
are dealing with, the largest storm and the most complicated 
recovery in the history of our Country.
    But how long has it been? We are at the stage. Is it the 
beginning stage of appeal?
    All right. How long did it take us? When did this start?
    Mr. Rainwater. Chairwoman, if I could, when we got here. 
Actually, it started right after the storm.
    When we got here in January of 2008, the Governor and I sat 
down and said, okay, what are our priorities? And, obviously, 
Charity Hospital was the number one priority for the recovery.
    Then we said, okay, so are we right in the fact? Do we 
believe it was actually 50 percent damaged or not?
    So we sat down with our FEMA counterparts. They obviously 
disagreed.
    So we said, let's have two studies done. We had the two 
studies done. We presented the studies. It has taken us a year.
    In December of last year, Deputy Secretary Paul Schneider 
with Homeland Security, Chief Operating Officer Admiral Harvey 
Johnson, Director Jim Stark at the Transitional Recovery Office 
and General Doug O'Dell came to the Governor's office with 
myself and our Health and Hospitals Secretary, Alan Levine, and 
sat down and presented us the $150 million Public Assistance 
Project. It took almost three years to get to that point where 
you got to the 150, obviously, a sort of the settlement offer 
if you use that term loosely. Here is what we can pay for.
    And so now, we are in the process of writing our appeal to 
that project worksheet that they presented to us which, by the 
way----
    Ms. Norton. Who? Let's talk about who is in charge of that 
appeal.
    Mr. Rainwater. Right now, the State of Louisiana is working 
that appeal.
    Ms. Norton. Now who makes the decision?
    Mr. Rainwater. With the State of Louisiana?
    Ms. Norton. No. Who is the decision-maker? Is there any 
conflict of interest in that system?
    Mr. Garratt. The first appeal will go to the regional 
administrator, in this case in Denton, Texas at Region 6.
    The second appeal comes up to FEMA headquarters and is 
resolved by the Assistant Administration for Disaster 
Assistance.
    Ms. Norton. Now you say 40 percent of these appeals are, in 
fact, won?
    Mr. Garratt. I am saying, thus far, for the appeals that 
have been submitted for Mississippi and Louisiana, the number I 
think is over 40 percent have been resolved either in whole or 
in part in favor of the appellant.
    Ms. Norton. Do they then get, as is often the case in 
court, one of the most wasteful things we do in the litigation 
system is we let everybody go through trial and then after 
everybody has spent everybody's money, then we resolve the case 
as it is about to go to decision? Is that what happens in this 
appeals process?
    Mr. Rainwater or Mr. Garratt or Mr. Stark, was there a 
decision by the decision-maker because apparently it came out 
okay?
    Or let me ask Mr. Rainwater. I don't expect the State not 
to want as much money as it can, but Mr. Garratt characterizes 
these appeals producing a satisfactory result. Would you agree 
with that?
    Mr. Rainwater. Yes, Chairwoman. I mean the State has.
    I mean we look at the appeal first, and we don't send up 
appeals that we don't think have merit. Not all appeals are 
afforded by the State of Louisiana. We go back to local 
applicants, and we tell them that your appeal doesn't really 
have any basis.
    Ms. Norton. Are you satisfied enough that you agree with 
that 40 percent?
    Mr. Rainwater. Yes, ma'am, so far. Yes, ma'am.
    Ms. Norton. So it looks like there is a mechanism, and it 
looks like FEMA does have. I am just basing this on your 
testimony, even though it is within the Agency as you might 
expect, that the system is not inherently unfair.
    Were these decisions on the merits or were these decisions 
of the kind I just indicated where essentially the parties get 
together at the point of decision and essentially resolve the 
matter by coming to some kind of compromise?
    Mr. Rainwater. Chairwoman, these were appeals that went up 
through the process. Some of those appeals, I don't know what 
the numbers, but we actually have the ability to do an oral 
appeal now which is one of the things that we worked on in 
February of last year, and we just felt that.
    Ms. Norton. Excellent. Is that because some things are 
fairly small? How could you do an oral appeal?
    Mr. Rainwater. Chairwoman, what happens is, I mean, some of 
those things are so important to a mayor or a parish president 
or a university president that we felt like it was important 
that they be afforded the opportunity to either come down, 
either have the FEMA official come to Louisiana or the State or 
local official come to Washington, D.C. to make that appeal in 
front of someone, to bring their case.
    And so, we think it has worked very well. The applicants 
are very happy. They feel like there is some transparency there 
where an applicant can argue their case in front of someone, so 
they know who that decision-maker is.
    As you know, being an attorney, I mean, you want to be able 
to argue in front of a judge. And so, that is what we heard 
from our applicants.
    Ms. Norton. Are most of these resolved at the local level 
or do you have to go all the way up to the Supreme Court, as it 
were?
    Mr. Garratt. Ma'am, once it is in the appeal process, then 
an appeal will be rendered or an appeal decision will be 
rendered on that. So I am not aware that most of these are 
resolved before the appeal is ruled on. However, there are 
instances throughout the Nation where final appeals are, in 
fact, litigated afterwards.
    Ms. Norton. Mr. Rainwater, in your testimony, you mention 
setting up a streamlined appeals process. Did FEMA endorse the 
idea of a streamlined process? Did they participate in setting 
up such a process?
    Mr. Rainwater. Chairwoman, we haven't gotten to that point 
of the streamlined process. That is one of the things that I 
mentioned earlier about the scale of this and presentations to 
prior senior FEMA leadership in trying to provide and make sure 
that the Transitional Recovery Office and everyone up and down 
the chain has the information.
    Ms. Norton. So by streamlined process, you mean what, Mr. 
Rainwater? What would be different?
    Mr. Rainwater. A process a little bit more robust. A bigger 
pipe, you might say, to take on more appeals.
    But remember, ma'am.
    Ms. Norton. You mean like more staff for the appeal?
    Mr. Rainwater. More staff, yes, ma'am.
    But remember the challenge really is at that dispute area 
in trying to get the decisions.
    Ms. Norton. I am not going to forget that, despite Mr. 
Garratt trying to change the subject on me to focus on 
something that, I am very pleased to say, works.
    And, by the way, while we have been very tough on FEMA, I 
ought to say and I do want to say this for the record the point 
of a hearing, in my judgment, is to solve outstanding problems. 
Frankly, if FEMA had brought this to us, and that is what I 
have always urged them to do, we are willing to engage in that 
problem-solving process with you.
    But I do want to put on the record that when Gustav began, 
I called Mr. Paulison who was then the Administrator. I said, 
this is it, Mr. Paulison. Are these people going to be 
evacuated? Can you assure me?
    It was over a holiday. I had to find him through some 
contorted mechanism. Are these people going to be rescued or 
are we in for another Katrina?
    And he assured me that every living soul would be rescued.
    And guess what. The rescue, the evacuation in Texas, we 
have not had lots of complaints about. As we evaluate the 
Agency, nothing could be more important than the fact that 
these people got out as they did not in Louisiana. That shows 
improvement as far as we are concerned.
    I am sorry Mr. Paulison isn't here to be congratulated, but 
he knows how pleased we were at that.
    That was a very big marker. The reason I count it as a big 
gain for FEMA is that Gustav and Ike weren't planned. That was 
another very major storm, and it looks like the folks got out. 
We had some problems in Texas we will hear about, but the major 
problem that the whole Country judged FEMA by was in fact 
basically cured, it would appear, in Texas.
    All I am trying to do with the appeals process, Mr. 
Garratt, is to not tackle with what may work and only with, as 
Mr. Rainwater keeps leading us back to, what apparently is 
responsible for the holdup of the $3 billion funds.
    Let me ask you this, Mr. Rainwater. Do you believe that the 
holdup of the money basically is in Washington or do you think 
the holdup is really on the ground?
    Mr. Rainwater. Chairwoman, if I could answer that by going 
back to the response because I think there are similarities 
here.
    I worked in the evacuation of the City of New Orleans 
during Hurricane Katrina, Rita, Ike and then Gustav. The 
Governor deployed me. When I am not doing recovery work, I am a 
Lieutenant Colonel in the Guard, and the Governor embedded me 
with Mayor Nagin and his staff for 14 days. What we all 
recognized is that we needed to do things differently, and so 
he gave me operational authority on the ground in working with 
the city and working directly with FEMA National and Region 6.
    Region 6 brought its folks over, embedded it in the 
Governor's Unified Command. I was embedded with Mayor Nagin. We 
were able to make decisions. At Union Passenger Terminal, we 
evacuated almost 18,000 people, and we did that by making tough 
decisions on the ground, quickly.
    My point is this. If you take the response and then you 
overlay it over the recovery, you are almost in the same 
situation. We have to look at the recovery, this recovery--
Katrina, Rita, Ike, Gustav--differently than we have done other 
recoveries because the scale and complexity of it is just 
different and it needs a different set. Sort of, look through 
it with different glasses basically.
    Just as we did, we thanked FEMA for their strong response 
to Gustav and Ike. We had a good partnership. Mr. Stark and I 
were able to work through some issues very quickly on the 
recovery side because he was engaged as well from the response 
side.
    And so, coming out of that, what we said is that: Look, 
let's renew our partnership. Let's get together on these sorts 
of issues.
    Very frankly, what we feel like is that we have been bogged 
down in these sort of discretionary policy decisions. The 
Stafford Act, I mean in a catastrophic event, it is very 
difficult to work through just because of the processes 
themselves, but it does give discretion to the regional 
administrators to work through issues.
    And so, our point is this, and we have shared this with 
Secretary Napolitano's Chief of Staff, Jan Lesher, and others, 
and I have spoken to this with Jim and Mr. Garratt, and that is 
if you have a Transitional Recovery Office, then let the 
Transitional Recovery Office make the decisions and only allow 
for the most egregious issues with the State. If the State of 
Louisiana, if you think I am trying to get over on you, then 
take it to Washington but not every decision.
    Ms. Norton. Yes, it looks like the stumbling block may be 
in Washington. You have to let people do what they do best.
    Mr. Garratt and Mr. Stark, I congratulated Mr. Paulison, 
but I am well aware that you deserve part of that 
congratulations and, as Mr. Rainwater just indicated, for what 
happened in Louisiana as well as Texas.
    Now that he is back from voting, I am going to be voting 
anytime. Soon, I hope. But meanwhile, we were able to keep the 
hearing going.
    I do want to say before I pass over to Mr. Cao, who is on 
the ground and I am sure will have truly pertinent questions, 
that what you have said, the theme of your testimony, Mr. 
Rainwater, is the theme of the post-Katrina laws we passed. 
Congress looked at Katrina and passed post-Katrina legislation, 
one piece of legislation not yet passed in the Senate. It had 
as its thesis: Katrina was so different that we will amend the 
Stafford Act with Katrina alone.
    The reason we did that was that FEMA didn't move. We 
thought FEMA had the authority to move, but just to make sure 
they understood we passed these laws.
    The whole theory here, both of the laws that include 
everyone and especially the laws that exempted, that took on 
Gulf Coast alone, was that this is one of a kind at least for 
the time being. Everybody else, get back. We are going to allow 
FEMA to operate in this way. It came out of testimony from the 
Members who begged for short cuts, who even at that point were 
telling us that the money wasn't being spent.
    So if you hear me pulling my hair out, it is because even 
legislation seems not to have resolved that.
    I am going to ask my good colleague from Louisiana to 
indicate his questions.
    Mr. Cao. Thank you, Madam Chair.
    Mr. Jim Stark, Mr. Garratt, if I receive one complaint from 
the State, I might have issues concerning whether or not 
reasonable people can disagree. But when I receive complaints 
from the State, from the Archdiocese of New Orleans, from 
Tulane, from SUNO, from almost every agency that I have 
encountered, the City of New Orleans, there is an issue here 
with respect to how the offices function down there in 
Louisiana.
    And in recent days, I have become aware of some serious 
problems in the TRO office in Louisiana, in New Orleans, more 
specifically. My staff and I are investigating these claims as 
is CBS News which is due to air a preliminary segment in 
tonight's news.
    These problems that we uncovered concern whether: Number 
one, the number of staff in the TRO office is adequate. Two, 
there are significant claims of equal employment opportunity 
abuses. Three, sexual harassment. Four, discrimination. Five, 
nepotism. Six, cronyism. Seven, ethics violations.
    Can you explain to me some of these problems, Mr. Stark or 
Mr. Garratt?
    Mr. Stark. Congressman Cao, first, let me thank you for 
your visit last week. I was very pleased. Even though we have 
invited Members to visit our office, you are the first to come, 
and I thank you for stopping by to talk with our people.
    The problems that you just enumerated came to light last 
week, and we have immediately responded by bringing down a 
climate assessment team from Washington to take a look at those 
serious allegations, which I personally am very concerned 
about.
    I am concerned about every one of our employees at the TRO 
in Louisiana. I am concerned about their well being. These are 
employees who live in Louisiana. They are helping their 
neighbors recover, and they need to be treated with respect and 
be taken care of.
    Each one of those allegations that you brought up is being 
investigated fully. We look forward to the response from the 
climate assessment team that just went down there.
    Mr. Cao. Now after speaking to some of your employees, they 
have conveyed to me that the FEMA office has basically lost its 
focus in rebuilding, that somehow senior staff members are just 
out for themselves.
    And speaking to other employees, they are telling me that 
they are very, very unhappy down there and that the office is 
run out of fear rather than to address the needs of the people.
    What has happened to cause your office to lose its focus, 
Mr. Stark?
    Mr. Stark. I don't agree with that statement that our 
office has lost its focus. Our office is focused on partnering 
with the State and the local governments to rebuild the State, 
and I don't agree with that statement.
    As I said, the climate assessment team is there to find out 
what the climate, the work employment climate is with our 
people, and we will take necessary steps to correct it.
    Mr. Cao. I agree with Madam Chair that there are 
discrepancies in testimony between you and between Mr. 
Rainwater.
    And I also sense the same discrepancy when I speak with you 
where I am not sure whether or not there are misrepresentations 
or what have you. But you are telling me that the State is not 
reaching out. The State is telling me that you are not reaching 
out. The city is telling me that you are not reaching or your 
office is not reaching out.
    So who is not communicating to one another? Is it your 
office that is not communicating with the State and the city or 
is it the State and the city that are not communicating with 
your office?
    Mr. Stark. As I said in my testimony, Congressman Cao, I 
feel that the way to resolve these issues is a collaborative 
process, and, quite frankly, we have not always had that 
collaborative process.
    In dealing with some applicants, we have been denied access 
to facilities that we needed to get into to make certain 
estimates on damage, damage repairs and estimates of disaster-
related damages. We are working through that with the State and 
with the individual applicants. We have tried to reset or 
recalibrate our focus on that.
    I think as we work through the very specific project by 
project disagreements in collaboration rather than, as I said 
before, we come in with our position and throw it over to the 
State, and then months later they come back, and months later 
we come back. We need to sit down now and solve these hard 
problems. All the easy ones are solved.
    Mr. Cao. Now you just told me that some of these problems 
came to the surface within the past week. There are allegations 
of sexual harassment that has been going on for almost a year. 
So, how can you tell me that these problems only surfaced 
within the past week?
    Mr. Garratt. Let me just in here, if you don't mind, Mr. 
Stark.
    About a week and a half ago, we at headquarters were 
notified by the Director of our EEO office, Pauline Campbell, 
that she had received word that there was an uptick in issues 
at the TRO in terms of equal opportunity issues.
    We asked her at that time to investigate that. We asked her 
to form a tiger team, to send that team down there immediately 
to essentially do what Mr. Stark described which is a climate 
assessment. Let's go down there and get some feedback on 
whether such conditions exist and whether we need to do a more 
robust and thorough investigation.
    Well, that climate assessment team is still down there. 
They have been down there for a week and a half. They have been 
doing a number of interviews. And the purpose of that team is 
to come back and inform the leadership of FEMA what the status 
is down there and make recommendations on what we need to do 
next.
    We take this very seriously, and we are planning to tackle 
that.
    In terms of specific allegations of sexual harassment 
against any employees, those exist throughout FEMA. We process 
a large number of EEO complaints and other complaints 
throughout the FEMA body throughout the course of a year. They 
certainly exist in the TRO. Those are always investigated, and 
they are always investigated quickly through our standard 
existing EEO process.
    So if there are any sexual or allegations of sexual 
harassment anywhere in FEMA, rest assured that the EEO 
architecture is investigating them. When the report comes back 
on those investigations, action as required will be taken to 
deal with it.
    Mr. Cao. Mr. Garratt and Mr. Stark, I hold in my hand here 
a detailed description of the Charity assessment which is 
around 18 pages. The property is valuated at $490 million. My 
house is valuated at approximately $350,000. It was damaged by 
flood and wind, similar to Charity Hospital, because of 
Katrina. And I can tell you that my insurance adjuster provided 
me with a thicker adjustment than what I am holding here.
    Now this adjustment shows $129 million in damages. Yet, 
your statement says that the Stafford Act does not allow FEMA 
to compensate for damages not caused, not related to disasters. 
Yet, in the process of dealing with settlements with the State, 
you offer $150 million to the State while these documents only 
show $129 million.
    It seems to me that there is certain discretionary 
decisions can be made with respect to the Stafford Act. So why 
is this insistence on the inflexibility on the limitations of 
the Stafford Act when you, yourself, are making decisions 
contrary to what the Act is doing or is saying?
    Mr. Garratt. In terms of the decision that was made 
regarding the $150 million, FEMA had identified some number of 
damages that they had determined were related to the disaster, 
directly related to the disaster.
    There was some number of other damages that were the result 
of or could have been the result of or, in the estimation of 
FEMA, were the result of failure to properly secure that 
facility and prevent additional damage from occurring following 
the disaster.
    FEMA program staff looked at the information and made a 
determination that X amount of this was within that preventable 
category and should not be reimbursed and X amount of that 
could potentially have been unpreventable. It was a subjective 
call. It was made by DHS leadership.
    They looked at the existing body of information related to 
that damage that was in that gray category in their estimation 
and made a judgment call that we are going to give the benefit 
of the doubt to the State on this particular damage, and that 
is how we got up to 150. They essentially gave the benefit of 
the doubt to the State on those damages.
    Mr. Cao. I am sorry. What was your last statement? I am 
sorry. I didn't hear it because of the bell.
    Mr. Garratt. The determination to bump up the figure to 
$150 million resulted in a DHS leadership determination that a 
portion of the damages that we could not validate as being 
disaster-related could potentially be disaster-related and gave 
the benefit of the doubt to the State on whether they were or 
were not disaster-related.
    Mr. Cao. So this really brings me to the question of 
allegations that decisions are being arbitrarily made with 
respect to damage evaluations, and it really asks me to 
question whether or not these decisions are being arbitrarily 
made.
    There are a lot of recovery issues in the Second District, 
and I am not sure whether or not the problems are here with how 
you all operate, with respect to your staff, who is making 
decisions.
    Let me ask you a question. Who makes the final PA 
decisions? Is it you or is it Mr. John Connolly?
    Mr. Stark. Mr. John Connolly is the Public Assistance 
Officer. He usually makes those final decisions unless it comes 
to a point where--it is my actual signature, but I usually pass 
his decisions on as the Public Assistance Officer.
    Mr. Cao. What qualifications does he have with respect to 
these decisions and how they are evaluated?
    Mr. Stark. He has been a Public Assistance Officer in FEMA 
for, I believe, over 15 years.
    Mr. Garratt. Let me add onto that. We sent Mr. Connolly 
down to the Gulf Coast specifically because he is regarded as 
one of the premier Public Assistance experts in FEMA. He comes 
out of Region 3, out of Philadelphia, lots of experience, but 
he was sent down there specifically to replace the existing 
Public Assistance Officer at the time and to get that operation 
back on track from a Public Assistance perspective.
    Mr. Cao. And can you tell me how many times has 
Philadelphia been damaged by a hurricane?
    Mr. Garratt. I can't tell you how many times Philadelphia 
has been damaged by a hurricane, but we can certainly, I think, 
provide you the probably large number of hurricane disasters 
that Mr. Connolly has responded to before he was sent down to 
Hurricane Katrina.
    Ms. Norton. Mr. Cao, I am going to hold this until you come 
back in any case so that Mr. Guthrie can get in some questions, 
and I know you all have to go to vote again. Why don't you do 
that? You then can run to vote and don't worry I have a lot of 
questions while you are gone.
    Mr. Cao. Thank you very much.
    Ms. Norton. Mr. Guthrie.
    Mr. Guthrie. Thank you, Madam Chairwoman.
    First, let me just, if it is okay, have a point of 
privilege. My father just came in. He is up here to watch the 
speech last night, and he came in the back of the room. So I 
appreciate that he is able to be here.
    So we are going from the Second District of Louisiana to 
the Second District of Kentucky, I guess I would say.
    First, I just want to say Colonel Kadesch who is the FEMA 
officer or head of the effort down in Kentucky, I met him the 
other day. I think he is doing a great job. And the FEMA 
employees that I have been around have all been professional 
and have worked hard and have missed as much sleep as a lot of 
our local officials, working, as you will hear from Judge 
Logsdon shortly.
    I guess a couple of questions. I was going to, hopefully, 
have Judge Logsdon speak first and then maybe ask some 
questions because I know what he is going to talk about.
    One, just how do you work through this issue when Katrina 
was coming? I remember it. I remember Governor Barbour getting 
on TV, saying this is Camille. He said, don't say Cat 5. Say 
Camille, and people will understand it.
    So I know you guys were working to get ready.
    The ice storm, I know my wife was coming to D.C. when it 
hit and said, we have to get out of town because we have a 
storm coming. We didn't see it coming as bad as it was and the 
damage that it was until it hit.
    So in order to get prepared and get people on the ground, 
how do you react?
    What kind of procedures do you have, say we didn't see this 
coming--a tornado would be the same situation--and deploy 
assets quickly? Is there a way that you speed up the process in 
that?
    That was some of the concerns, getting assets on the ground 
quickly. That was one of our issues, not that your employees 
weren't working hard, just getting in there in a quick way.
    Mr. Garratt. Happy to answer that.
    By the way, I would like to also compliment the State of 
Kentucky. As you know, Acting Administrator Ward visited the 
State of Kentucky, and all of the reports that we have received 
from Mr. Kadesch and others indicate that your guys performed 
exceptionally well down there.
    I think as you reported earlier in your remarks, as you 
began to characterize the nature and scope of the response and 
how well your citizenry and the elements of the response, how 
Kentucky responded to that, all reaffirmed by our own folks 
down there who think you did a fabulous job.
    In terms of how we respond to a disaster, we have the 
ability to pull the trigger immediately on resources from any 
number of venues in the United States. We have logistics 
centers where we store products. We have teams that are ready 
to go at a moment's notice including Incident Management 
Assistance Teams who are on alert all the time.
    Once we are aware of an incident and once we are aware of a 
potential incident, we have the ability to begin moving assets 
to deal with that, and we will either do that proactively 
because we make a determination that it is necessary to begin 
pushing assets there because we recognize that they are likely 
to be needed or we will do it if a State asks us to preposition 
those assets. Either way, we have the capability to move 
quickly.
    So it will either be a unilateral determination or it will 
be in response to a request from the State.
    Mr. Guthrie. And then one of the things I am sure we are 
going to hear from the Judge when he speaks is just generator 
capacity. I know we are going to do an after-action review and 
try to how can we do things better.
    But our water systems, people were losing water and had 
boil water advisories because the water systems went down.
    And I believe there were instances of generators coming in 
that weren't the right applicable generator for that facility. 
I think Colonel Kadesch has talked about doing an inventory. 
And then maybe some of the local people didn't have the ability 
to hook to the generators or coming and they didn't work. So I 
mean that is the concern, that how do we preposition our assets 
just in general in certain areas so when these unexpected kind 
of storms hit they are available.
    Then just one other thing I am kind of tying to that 
because I know we are going to have to go vote, just 
contracting and flexibility. Maybe we hold you to that by 
statute. I am not sure.
    But I know a road contractor talked to me. Matter of fact, 
Judge Logsdon kept calling to get backhoes, and they kept 
bringing backhoes. Then when you start looking at reimbursement 
for that, well, they were not an approved contractor. These 
guys were down there.
    And I know people take advantage, and we have to protect 
the taxpayer dollar, but if there is some way we can have on 
the spot decisions to get assets in, the local assets to clear 
roads. Like I said, it took six days to get to one particular 
lady's home, and she lived way off the beaten path.
    But if they can react quickly and just be more nimble, I 
think that is what we would like, I would like to hear, if 
there is something is we need to do here in order to make your 
job so you can act more quickly.
    So I guess my questions are getting to just explaining 
getting assets in the right place at the right time and how you 
can bring local people who have the assets on board to FEMA in 
a quick way as well.
    Mr. Garratt. We are interested in both of those.
    Let me tackle the last one first, and that is in terms of 
the ability to contract quickly for debris removal. We are very 
interested in the ability of States to be able to do that. We 
stood up a contractor registry to specifically identify those 
contractors who have the ability to do that in States across 
the United States.
    If there are concerns about your ability to have 
preexisting contracts and whether they will support 
reimbursement, then we will be happy to work with you out of 
Region 4 to make sure contracts that any of your jurisdictions 
have set up in advance for any type of debris removal are valid 
contracts and will be supported through reimbursement.
    Let me address the generator issue because we recognize 
that was an issue in Kentucky, and I think we both have a part 
to play in that, Kentucky and FEMA in that regard.
    We package these generators in what we call 50 packs, and 
they are normally assorted sizes in those 50 packs. We can 
shoot those out quickly. We can get them somewhere, and we know 
that some number of those generators will meet your needs but 
maybe not all of those generators.
    In this particular case, what we found was fewer of those 
generators in those 50 packs ended up meeting your needs than 
was ordinarily the case. And so, what we need to do is come up 
with a better way of packaging these generator packs or have 
the ability to immediately develop such generator packs based 
on what your actual needs are and send them to you so we are 
not in a situation where we have generators that we do not 
need.
    What also would have helped was if we had complete full 
assessments of all of your critical facilities and knew exactly 
sort of generator was required and what would be needed to set 
that up. We didn't have that when we came in.
    The Corps has recognized that, the Army Corps of Engineers. 
FEMA, we have that on our plate, and what we want to do is work 
with the State of Kentucky to fully assess all of those 
critical infrastructures and know exactly what the requirements 
are.
    So, in the future, if we are faced with another situation 
like this, we are going to come in with the right generator, we 
are going to go right to the place where it needs to be 
installed and we are going to know exactly what is going to be 
required to get that installed. So that should eliminate the 
problems in the future.
    Mr. Guthrie. Well, thank you. I know we are going to go 
vote, so I will be back shortly. But I do want reemphasize that 
every one of your employees that I dealt with was extremely 
professional, very caring, very hardworking, and I really 
appreciate their efforts.
    We just need to make sure if we are hamstringing you to get 
assets in the right place or if there are better ways to plan 
as you just said with the generators. I am glad that you took 
note of that, and Colonel Kadesch has talked about what you are 
describing.
    I just want to bring that out for the record. I appreciate 
that. People were going several weeks without power. So we were 
all getting kind of frustrated in working to try to help them.
    But again I will close with I appreciate the effort of your 
employees on the ground.
    Thank you.
    Ms. Norton. Thank you, Mr. Guthrie.
    I want to clarify on the appeals process. How, if at all, 
is the Department of Homeland Security bureaucracy involved in 
the appeals process?
    Mr. Garratt. The appeals process takes place entirely 
within FEMA, ma'am.
    Ms. Norton. So it does involve anyone in DHS bureaucracy.
    Mr. Rainwater?
    Mr. Rainwater. If I could, Chairwoman, what had happened 
with Charity Hospital is it got a lot of visibility in the 
prior administration, and there was some conversation about who 
was going to manage that. So Deputy Secretary Paul Schneider 
and Secretary Chertoff got with Secretary Leavitt in Health and 
Human Services and started to sort of devise a plan to kind of 
work with us in sort of a broader sense because we were looking 
at different ways to get to that $492 million. To their credit, 
I think they were trying, and Chief Operating Officer Harvey 
Johnson, Admiral Johnson, was trying to be creative about the 
way they approached this.
    That is where Homeland Security was involved in that one 
issue, but they haven't been in involved in any of the appeals. 
From time to time, they will get involved in the dispute piece 
as we raise issues up like Charity and Tulane University and 
others, but typically the official system rests between the 
State and the Federal Emergency Management Agency.
    Ms. Norton. I guess they saw this, as you say, high profile 
Charity Hospital notion. So that is important to note that FEMA 
is it, and I will have more questions on that in a moment.
    But let me try to get to the bottom of this valuing 
projects, this undervaluing as the State would say, valuing as 
FEMA would perhaps say because the Committee has heard, of 
course, repeated complaints about undervaluing projects.
    Who does FEMA employ to do the estimates? How are they 
monitored, checked or somehow verified?
    Mr. Garratt. Ma'am, we employ contract firms that support 
us under our Public Assistance, Technical Assistance contracts. 
These are A&E firms, for the most part, employees who are 
engineers or are expert in the type of assessments and 
evaluations for the type of structure that they are responsible 
for assessing.
    So, generally it is done by individuals who are 
practitioners in the field, but they are contractors.
    Ms. Norton. Now, Mr. Rainwater, do you believe that these 
professionals consistently undervalue the scope and estimates 
of projects any more than one might expect as to differences 
between FEMA and the State?
    Mr. Rainwater. Chairwoman, I have spent a lot of time 
talking with our architects and engineers at the State level.
    Our Office of Facility Planning and Control is where the 
rebuilding of universities and other things takes places, and 
it is the largest Public Assistance applicant in the history of 
FEMA. It is run by an architect, and he will tell you that 
many, many times the folks that he is sitting across the table 
are not architects and engineers, and he relayed to me.
    Ms. Norton. Who are they?
    Mr. Rainwater. In this particular case, it was a person 
that understood the Public Assistance policy but didn't 
understand the engineering estimating piece.
    Ms. Norton. Excuse me. These are contractors?
    Mr. Rainwater. Yes, ma'am. In this particular case, I think 
it was or it was a temporary employee with FEMA. I think what 
they call a core employee, someone that is on for two or three 
years, and I don't want to speak to that.
    Ms. Norton. Well, wait a minute. I am talking about who 
does the technical work, this undervaluing of projects with the 
scope and estimate problem. Are you saying the contractor is 
not using experts like architects and engineers?
    Mr. Rainwater. Chairwoman, in our estimation, in some 
cases, that is not happening.
    I mean, again, one of the issues. I am a liberal arts 
major. I am not an engineer and architect, but I do know that 
our Facility Planning and Control folks and the folks that 
local governments hire are engineers, architects who work with 
local governments quite often.
    There was an incident just recently where our Facility 
Planning and Control, a certified architect, was having a 
conversation about estimates with someone who had a graduate 
degree in English.
    Although I think it is great to have a graduate degree in 
English because I have graduate work in English myself, but I 
am not in any way qualified to sit across from an architect and 
engineer and debate about whether or not Charity Hospital or 
any other or a fire station or a police station should be built 
at a certain cost. I rely on the experts to do that.
    And so, it has been something that we have worked through, 
and it raised as an issue that we needed more technical folks 
on the ground.
    Ms. Norton. I am going to have to allow Mr. Garratt and/or 
Mr. Stark to reply to this statement by Mr. Rainwater that it 
is possible to have a contractor of the Federal Government 
doing scope and estimate work who is not an architect, engineer 
or other similar expert. Is that the case?
    Mr. Stark. Well, Madam Chairwoman, I am not sure that Mr. 
Rainwater said that. What I heard him say is that his chief 
architect or his head of FP&C was in a conversation with 
someone.
    Ms. Norton. Well, let's clarify. We are sitting here at the 
same table.
    Mr. Stark. That is the first I have heard this.
    Ms. Norton. Okay, well, we are sitting here at the same 
table for a reason. I ask that instead of seriatim hearing 
witnesses, that they help us by sitting together.
    Now would you clarify, Mr. Rainwater? Are you talking about 
somebody who your architect is talking to who is a contractor 
who is in charge of this issue and he is having to talk with 
this person who is not a technical expert?
    Mr. Rainwater. The Deputy Director of our Office of 
Homeland Security where our Public Assistance sits, who is a 
civil engineer, has told me on numerous occasions he has had 
conversations with people that were contractors who are not 
technical people. They might have experience in construction.
    But I mean, again, Chairwoman, it is the narrow sense in 
which we are even having this conversation, that if our chief 
architect would even be having a conversation with a person 
about a technical issue who has a graduate degree in English, 
why isn't he talking to an engineer or an architect?
    Ms. Norton. Now, see, Mr. Stark, that is the question. So 
now you have clarified the question.
    Mr. Garratt. I also may have contributed to a 
misunderstanding here. What I said earlier was that we employ 
architecture and engineering firms to provide the personnel who 
make up our PA tech contracts. I did not necessarily mean to 
imply that every single person who is supporting these 
contracts is either an architect or an engineer.
    What they are are experts. They are folks who have been 
hired by these firms and may have expertise in a lot of the 
unique subject areas, roads, bridges, for example. So they are 
hiring individuals. They may train the individuals, but they 
may not be an engineer or an architect.
    Ms. Norton. Well, why is the Federal Government paying 
money for people who are not technical experts that sit on the 
other side of people who are?
    I mean after all you are having to contract. What is the 
advantage to the Federal Government in facing people who are 
experts with people who are not?
    Mr. Garratt. I am going to turn over to Jim here in terms 
of this specific instance, but I am not aware that this is a 
systemic problem at all.
    Ms. Norton. Well, he said, on numerous occasions. That is 
why. On an occasion, then we could ask you to correct.
    But, Mr. Rainwater, you are saying? And repeat it so we 
have on the record what the testimony is, and we can get the 
response from the Agency.
    Mr. Rainwater. Chairwoman, I think it really is about 
consistency and making sure that the Federal agency has the 
right number of technical people involved in the Public 
Assistance process so that on a consistent nature, if we are 
going to be this narrow about it, that they are talking with 
our technical engineers, civil engineers and architects at the 
local and State level are talking to technical people when we 
get into conversations.
    I understand that you are going to have Public Assistance 
policy contractors involved. I have no problem with that. We 
have our own Public Assistance policy folks involved as well 
that are contract, and they help us work through the policy 
issues of Public Assistance. That is not what I am complaining 
about.
    But when we get to a point where we are talking about the 
nuts and bolts of a building or the cost, then what I expect is 
an engineer to be talking to an engineer.
    And if on my part, on the State's part, if I don't have a 
technical person or if I find out I don't have a technical 
person making that argument, then shame on me, and I will fix 
that very quickly.
    Ms. Norton. Well, I have to have a conversation with the 
appropriators because either FEMA has the technical experts in-
house or FEMA is contracting with technical experts. Now my 
problem is whether we are wasting the government's money 
because it seems to me the State has an advantage, and it also 
has a reason not to agree with the contractor if the contractor 
doesn't look like he is somebody who has the technical 
background to make the decisions.
    I see two problems there, and I think if the appropriators 
see it they will make the required correction to make sure that 
Federal money goes to people who are qualified to sit across 
from the State and local people and in no instance are using 
people who don't have the requisite qualifications.
    Now you said, Mr. Garratt, you didn't think this happened 
very often. That is why I had Mr. Rainwater to indicate how 
frequent this was, and I see another structural problem. I 
don't understand why.
    Why in the world, since you are paying these people, would 
you not look for people who will assure the government that 
they, that the contract will be handled exclusively by people 
with the requisite technical expertise as a part of the RPF and 
the awarding of the contract? Why would you not do that?
    Mr. Garratt. Madam Chair, I will still hew to the belief 
that by and large, 99.9 percent of the time, we have the right 
people in the right place dealing with and representing Public 
Assistance issues and functions when they are out in the field.
    Are there going to be instances when someone is not 
available or we have a general Public Assistance person dealing 
with an expert? There certainly are going to be instances like 
that.
    If, in fact, this is a systemic problem, we want to fix 
this as much as you want this fixed. I am not aware that that 
is the case. These sound to me like isolated cases, but we are 
certainly willing to look into this and see if this is more 
than an isolated problem and if, in fact, it represents more of 
a systemic issue.
    Ms. Norton. Well, I tell you, you didn't see any problems 
with the appeals process either, and I am about to ask a 
question on that, Mr. Garratt. I don't see any reason to defend 
a process simply because it is a process.
    Now Mr. Rainwater didn't have any reason to bring this 
issue up, and I don't know how to resolve it except one way. 
Since you say 99 point whatever, 1 percent,, there is no 
problem, well, you will not mind appropriation language for 
that 1 percent that says: Under no circumstances may a contract 
be let to a contractor who cannot guarantee that the Federal 
Government's decisions are being made toe to toe, technical 
person to technical person.
    They will have to devise the language, but since you say it 
happens and most of the time it is not a problem, I am sure you 
won't mind the language.
    I am going to ask one question before I pass it back to Mr. 
Cao. I simply have to get your answer, Mr. Garratt or Mr. 
Stark, to the examples in Mr. Rainwater's testimony.
    Remember, I am trying to find out if the appeals process 
works. If you think I am concerned about $3.4 billion 
outstanding just sitting there because nobody has found a way 
to make a decision, what is even worse, it seems to me, are at 
least some of his examples.
    Explain to me a government process that you would stand 
behind that, for example, in the Recovery School District. I am 
looking at Page 8 and 9 of Mr. Rainwater's testimony. In the 
Recovery School District, of all places, a school district, 
they spent a million dollars on architectural engineering fees 
that were reversed after they spent the money. You said, okay 
and no okay.
    Then you go on to the Vermilion Parish where you said, 
okay, go ahead and then no okay. De-obligated the entire 
amount, $3.4 million. De-obligated the entire amount, he says, 
leaving the fisheries and evacuation route unprotected for 
future hurricanes.
    Or let's go to Westwego, approved, the full replacement of 
city hall and the city police station for approximately $7 
million. Acting in good faith, they went ahead and did what you 
do when you get approval. FEMA later recanted their eligibility 
determination and de-obligated approximately $6.5 million.
    I want to give you an opportunity to respond to these very 
specific examples of decisions made, money, in most of these 
cases, spent, going back to the locality or the State, saying: 
We recant. We were wrong. We are not giving you the money after 
all.
    Explain yourselves.
    Mr. Garratt. I will let Mr. Stark talk about the specifics 
of the individual cases that you mentioned.
    However, in terms of recanting, we make mistakes, Madam 
Chairman. We make mistakes when we are out in the field. When 
we are evaluating thousands and thousands of projects, we 
recognize that there is going to be opportunity for mistakes.
    We have a multilevel review process for every project that 
comes into the field, and in fact it is the obligation of those 
who conduct that multilevel review to make sure that that 
project is, in fact appropriately scoped, that the work is 
eligible, and if they notice that there is a problem it is to 
identify that, and it is up to us then to rectify that problem.
    We think that overall we do a pretty good job of scoping 
these.
    Ms. Norton. So that if there is a mistake on the part of 
the Federal Government, notice the number of mistakes here, who 
should eat it is the disaster area which didn't have any money 
in the first place, which is why they need it. They should 
somehow, even though on the good faith of the Federal 
Government they have gone ahead.
    You are really saying you think that is a fair process, 
because after all we have a number of appeals. So what in the 
world are you saying?
    Mr. Garratt. Ma'am, what I am saying is that we have an 
obligation to look for and catch our own mistakes, and if we 
catch a mistake it is to rectify that mistake. Now in a 
situation where no----
    Ms. Norton. If you make a mistake, I am sorry. If you make 
a mistake, then you think that the burden should go entirely to 
the disaster area which has no money and not you to even deal 
with some of your own mistake?
    You are here saying that in Louisiana where people don't 
have any money in the first place, which is why they have come 
to you, if you have made a mistake, the burden is on them 
because you have made a mistake and there is nothing that they 
should expect from you because you have made a mistake? Is that 
your testimony, Mr. Garratt?
    Mr. Garratt. What burden are you referring to, Madam Chair?
    Ms. Norton. I am talking about the burden of the people 
having started on the good faith decision of the Federal 
Government and then the Federal Government coming back after 
they started to spend money and saying, it is all wrong, we are 
not giving you the money.
    Who should bear the burden of that mistake, Mr. Garratt?
    Mr. Garratt. I would agree with you that the Federal 
Government should bear the burden of a mistake when it makes 
one and it has a financial implication on those that they are 
supporting. I absolutely agree with you.
    Ms. Norton. Mr. Rainwater, these terrible examples, who 
bore the burden in these examples in your testimony?
    Mr. Rainwater. Chairwoman, the local school district. In 
that particular case, the Recovery School District I mean, for 
example, yes, ma'am. I mean it is the local government.
    In some cases, we on the State level have taken some of the 
community development block grant money that you have provided 
to us and tried to fill gaps through what we call a FEMA 
Ineligible Pile which is about $270 million of disaster 
community development block grant to try to fill those gaps 
where it doesn't work.
    If I could, Madam Chairwoman, I think this is where the 
Stafford Act doesn't work, and I don't think it is a fault of 
Mr. Garratt or Mr. Stark or some of the folks at FEMA.
    I mean the Stafford Act I don't think ever saw the largest 
disaster in history coming at, and I don't think it is designed 
in a way to allow people. Obviously, there are folks on the 
ground from FEMA and others that are concerned that they are 
going to be held liable at some point in time for decisions 
that they make, and so I really think it is something that we 
need to look at.
    Ms. Norton. You know what, Mr. Rainwater? I have news for 
you. They could fix this right now. If I found myself making 
one mistake like this, reneging on the work, I would not blame 
it on the Stafford Act.
    Let me tell you what I would do. I would look at my appeals 
process instead of coming before the Committee and saying there 
is nothing wrong with it because obviously this went upstairs 
some place and they turned around the people on the ground.
    Since you can change your own appeals process, which you 
set up in the first place, I would begin to say: Wow, I must 
never do this again. I must never do this to a school board. If 
I do so, I must at least try to find some way to compromise the 
difference.
    So one thing I want to know is whether or not anybody at 
FEMA has thought of making appeals at the local level and 
asking headquarters to embed itself right there on the ground 
so that you would not have the complicated appeals process 
which looks more like a Federal appeals process.
    I don't accept what you are saying, Mr. Rainwater. I 
understand it, but it is not as if this is an appeals process 
which we said you must use.
    So I am asking you, Mr. Garratt. This appeals process that 
you think works so well, don't you think that there is 
something that could be done to bring headquarters there so we 
are not making an appeal to the Supreme Court and putting the 
burden on the people who are there to somehow rest on your 
mistake and error?
    And if it is a problem, as Mr. Rainwater says, with perhaps 
the Stafford Act, don't you think somebody would have come to 
this Committee and said, oh, God help us because this is the 
process we are caught in?
    I have received no such message. I didn't know about this 
outrage until this hearing. So I am trying to find out what can 
I at least do with the appeals process so that if headquarters 
of FEMA has to be involved, then would help?
    Instead of going upstairs to Washington, to in fact have 
someone on the ground and say that person on the ground who is 
embedded, now we have let's say a streamlined appeals process. 
It is over and done with. That is final. You can proceed, Miss 
School District or infrastructure district and do it and not 
fear that the word of the Federal Government will be broken.
    Could you not fix this appeals process by bringing people 
down to the ground?
    Mr. Garratt. Madam Chairman, I am not sure what part of the 
process you think would be fixed by doing that.
    Ms. Norton. The multi-tiered appeals process. I assume that 
this went up somewhere in the heavens and was turned around.
    Mr. Garratt. The point I am trying to make----
    Ms. Norton. If that is not the answer and you acknowledge 
this is unfair to the district, how would you fix it, sir?
    Mr. Garratt. First off, in terms of locating headquarters 
personnel down at the local level to adjudicate or be involved 
in adjudication of appeals, the actual adjudication process, 
making a decision is done following what is a tremendous amount 
of research into that appeal.
    It is part of that validation and research effort. It is 
what we talk about, that thoughtful, deliberative review of 
what that appellant submits. It often involves pages and pages 
of documentation and pictures, and what is often required is 
that to adequately assess that appeal and the merits of that 
appeal we essentially need to go out and reinvestigate all the 
parts of that. Having someone down at the local level is not 
going to eliminate or speed that part up.
    Ms. Norton. Okay, Mr. Garratt. Once again, you don't have 
any solution. You like it the way it is. I don't. The Committee 
doesn't.
    And again, you, yourself, can see that it is not very fair 
to go to people who have no money and say, well, there is 
nothing we can do about it because, after all, these appeals 
are 40 pages and it is our process.
    See, that is the problem I am having here. Do you concede 
that you, yourself, could change the process or are you stuck 
with it?
    Mr. Garratt. Well, it is a process that is out of 
regulation. So in a sense that the regulation can be revised, 
yes, ma'am, I would say we are stuck with the process that is 
proven to work over the years.
    Ms. Norton. Well, Mr. Garratt, I am going to let you rest 
on that, given the fact that you apparently accept the notion 
that since it is an appeals process that works as far as you 
are concerned, there is nothing can be done, leaving localities 
holding the bag that way.
    And guess what. When we get that kind of testimony----
    Mr. Garratt. The process works, Madam Chair, when it is 
used.
    Ms. Norton. Sorry?
    Mr. Garratt. I want to make the point that when the appeals 
process is used it works. If it is not used, it doesn't have an 
opportunity to work.
    Ms. Norton. Well, so the reason for this, Mr. Rainwater, is 
that the appeals process wasn't used. I thought they had the 
go-ahead.
    Mr. Rainwater. Madam Chairwoman, I don't think the appeals 
process is set up for 4,000 disputes. It is not.
    Ms. Norton. Well, why did these people proceed?
    Mr. Rainwater. In this particular case, this is an 
unresolved issue. And in this particular case, what happened 
is----
    Ms. Norton. No. I am talking about the several cases that 
you submitted in your testimony.
    Mr. Rainwater. Yes, Chairwoman.
    Ms. Norton. All involve people who apparently had word from 
FEMA to proceed and then FEMA came back and said, stop. That is 
what I am trying. Is that the case? I mean that is what you 
testified.
    Mr. Rainwater. Yes, ma'am. But my point is this, Madam 
Chairwoman. We are still trying to work through that issue 
because the Recovery School District believed by policy folks 
in FEMA that we could still work it out. We haven't gotten 
there as far as an appeal.
    There are numerous. There are hundreds of cases, and I 
spend a lot of my days talking to mayors, parish presidents, 
Recovery School District, Paul Pastorek, the State 
Superintendent of the Schools and others about these sorts of 
issues that we just can't seem to plug through.
    Ms. Norton. I tell you what, we are not talking just about 
delay. We are talking about not just costing the Federal 
Government money. We are now talking about costing localities 
money. That, I have had it and when I get testimony like your 
testimony.
    I don't know, Mr. Stark, if you have any different 
testimony. But Mr. Garratt's testimony is an invitation to this 
Committee to fix it since you have not come forward with any 
way to fix something that leaves the locality holding the bag 
for a FEMA mistake.
    Mr. Cao.
    Mr. Cao. Thank you, Madam Chair, and I would like to echo 
the concerns that you have conveyed in this hearing today, that 
while our children are not having adequate educational 
facilities, while our elderly are not having adequate health 
care, while our city is being ravaged by crimes, we are dealing 
with appeals and we are dealing with recants.
    I know that problem also was suffered by Tulane University 
when they carried out a project, hoping to get reimbursements 
from FEMA and FEMA recanted on the recommendations that Tulane 
follow. But I believe that some of the issues concerning Tulane 
University have been addressed in the past weeks. Is that 
correct, Mr. Stark?
    Mr. Stark. Yes, Congressman Cao. Some of those issues at 
Tulane have certainly been addressed, and we are still awaiting 
some documentation of additional costs that Tulane may have 
occurred in design, architectural designs based on bad advice 
from FEMA that may be eligible.
    If I may take the opportunity to try to correct the record 
a little bit on the very specific issues that were just brought 
up by the Chairwoman regarding Mr. Rainwater's testimony.
    In fact, at the RSD school, some of those A&E costs are 
eligible, but we have not received an invoice or documentation 
of those costs, and we look forward to working with the State 
as the grantee and the RSD as the applicant on those.
    Vermilion School has been obligated $6 million for 
replacement. I would like to work with the LRA to clarify their 
position that only $800,000 is left.
    On the Timbalier, I think I said that right, Island, that 
is the responsibility of another Federal agency. In this case, 
we believe that the EPA is the primary agency responsible for 
funding the restoration of an offshore island.
    The City of Westwego, in fact, we made a mistake. We 
measured the building wrong, and under those calculations it 
looked like it was eligible for a replacement. In fact, under 
the correct calculations, it was eligible for repair. Those 
repairs have been made and funded by FEMA.
    Mr. Cao. I have just a couple more specific questions 
concerning the Archdiocese and SUNO.
    First and foremost, in connection with the Archdiocese, it 
has been alluded to the fact that there are a couple projects. 
One is the Ville Ste. Marie Project that has been held up by 
FEMA. I believe the project is like 16 or 17 million dollars in 
the Lower Ninth Ward. Can you inform me with respect to the 
progress of that particular project?
    Mr. Stark. Are you referring, Congressman, to St. Mary's 
Academy?
    Mr. Cao. I have here as Ville Ste. Mary. I am not sure what 
that refers to. Well, what is the St. Mary's Academy, Mr. 
Stark?
    Mr. Stark. It is also a school in the Lower Ninth Ward, a 
Catholic girls' school that we have approved $4.4 million for 
the replacement of the faculty house. It turns out that under 
the Stafford Act regarding private non-profits, certain 
portions of buildings that are related to strictly religion, in 
this case the housing of the nuns, is not eligible for 
replacement, and we actually have to back that out.
    As far as the allegation that we de-obligated the entire 
amount, I believe that is just not true.
    Mr. Cao. What about the Ville addition? Are you familiar 
with that?
    Mr. Stark. I think that is what we are talking about, sir.
    Mr. Cao. That is the nuns' housing?
    Mr. Stark. Yes, sir.
    Mr. Cao. Now why is it not a purview of FEMA to address 
some of the issues concerning non-profit organizations?
    Mr. Stark. That is the reading of the regulation and the 
law, sir.
    Mr. Cao. Could you quote to me those regulations, first and 
foremost, with respect to the appeals process that Mr. Garratt 
has mentioned that is in regulations? I would like where those 
regulations are if you can quote me on that and these 
regulations that you are spewing out to us here. I would like 
to have specific sites where my staff can look at these 
regulations to see whether or not they are well founded.
    Mr. Stark. Absolutely, we can provide that for the record, 
Congressman.
    Mr. Cao. Mr. Rainwater, with respect to the FEMA Cottages, 
can you provide me with the progress of the FEMA Cottages?
    Mr. Rainwater. Yes, Congressman Gao.
    With regards to the Alternative Housing Pilot Project, the 
Governor directed me to take that program from the Louisiana 
Housing Finance Agency last year. Basically, it is a grant of 
$74 million to build 500 cottages.
    One of the challenges, and I will say in this particular 
case Randall Kinder, who is actually the program manager with 
FEMA, has worked very closely with us, and he understood very 
well the nature of what I had taken over, and that is a very 
complex program, and has worked extremely closely with us. I am 
very thankful to him for what he has done because, to be very 
frank with you, we couldn't have worked through the complexity 
of these issues and the challenges we are having, especially 
after getting hit with Ike and Gustav and delaying the movement 
or the building of those programs.
    We, currently, are going to be building Katrina cottages or 
these cottages at Jackson Barracks in Lafourche, Westwego, 
Baton Rouge, Louisiana and the City of Lake Charles.
    Originally, we, the State, under the former administration, 
had looked at large group sites. When we got there in January 
of 2008, what we decided is that what we needed to do is look 
at infill, and so we began to work towards doing that.
    We are making progress. We have started construction in 
Baton Rouge, Louisiana, construction in Jackson Barracks 
outside of New Orleans. We are in the process. In fact, it will 
be 91 units in Jackson Barracks, 42 in Baton Rouge, 100 at 
Lafourche, 27 in Westwego and 100 at NORA, New Orleans 
Redevelopment Authority.
    We are in the process, and we think that infrastructure 
will be complete at Jackson Barracks in March of 2009 and at 
Westwego in April of 2009.
    Housing construction, again, has begun in Jackson Barracks. 
We believe that end construction in Jackson Barracks could be 
as early as July of 2009 and then in Baton Rouge in June of 
2009, Lafourche, in August-September of 2009 and Westwego, 
August of 2009 and then in Lake Charles, September, NORA, 
September.
    We have been talking with FEMA about the possibility of an 
extension depending on what happens with weather, obviously, 
and the fact that we were delayed by about 60 days by Ike and 
Gustav. What I have told my team is that we need to show 
progress. We understand the importance of showing progress in 
building those cottages, and so I mean I think we are well on 
our way with that project.
    Mr. Cao. Thank you.
    Madam Chair, I don't have any more questions. Thank you 
very much.
    Ms. Norton. Thank you very much, Mr. Cao.
    Mr. Guthrie, have you any questions further questions for 
these witnesses?
    Mr. Guthrie. No further questions, Madam Chairwoman.
    Ms. Norton. Thank you very much.
    We have kept these witnesses for some time. While we have 
been tough on FEMA, we have also tried to give credit where 
credit is due. It seems to me if you ask me what would be the 
most important thing FEMA had to show to show that it had made 
progress, it would be the evacuation that Mr. Rainwater says 
and that we understand from officials in Texas that did in fact 
occur.
    Our concern here is, frankly, at least a concern of this 
Chairperson is being confronted for the first time with such 
large amounts of Federal funds unspent.
    I do want to say to you, I know there is a change in the 
administration. I mean Mr. Stark says he is a civil servant.
    I do want to say once again, we can't help the Agency if 
the Agency doesn't bring issues to our attention. Then we will 
try to work with the Agency to try to suggest ways to do it. We 
will do what we did in the Post-Katrina Act and other 
legislation still waiting in the Senate to be passed. We will 
try to fix it by legislation.
    We will make you understand that if you fix it, we do not 
consider it a violation of the Stafford Act if that is in fact 
the case. If the Subcommittee says that you have our word, 
nobody goes back on that.
    Our frustration comes when we hear about problems like this 
only as we prepare for a hearing and have not had any advance 
notice so that we could have begun to think through a solution 
in partnership with the Agency.
    I enjoy working in partnership. If we have to become 
adversarial, then of course that is what we have to do. We much 
prefer to hear from you early and often.
    I congratulate you on the evacuation work you did on the 
Gulf Coast in the latest very major disaster, and I thank you 
for your testimony.
    Could I call the next witnesses?
    Our next witnesses are Gary Logsdon who is a Grayson County 
Judge and Executive, Grayson County, Kentucky and H. Rodger 
Wilder, the Immediate Past President of the Gulf Coast 
Community Foundation.
    You have the advantage, Mr. Logsdon, of having one of your 
Members on our Committee. I would very much want to give him 
the opportunity to introduce you to the Committee.
    Mr. Guthrie.
    Mr. Guthrie. Thank you, Madam Chairwoman.
    I just want an opportunity to introduce to the Committee, 
Judge/Executive Gary Logsdon. Of course, the term, judge, in 
this role in Kentucky is a county executive or from previously 
in our testimony like a parish president. So we appreciate him 
being here.
    Judge Logsdon's county was one of the most decimated or 
damaged counties in Kentucky, probably one of the most in the 
entire area of Arkansas, Missouri and Kentucky. I went to see 
him and his operations center and how hard he worked on that, 
and he had some ideas.
    I thought once we had this hearing, it gave us the 
opportunity to have a witness, and I thought Judge Logsdon 
would be able to really explain from the local level and the 
local perspective, interacting with FEMA and just the storm 
damage assessment and reaction in general.
    He has been Judge/Executive since 1993, and I really 
appreciate him being here.
    Ms. Norton. Thank you very much, Mr. Guthrie.
    Well, let us begin with Judge Logsdon.

 TESTIMONY OF GARY LOGSDON, GRAYSON COUNTY JUDGE/EXECUTIVE AND 
    H. RODGER WILDER, IMMEDIATE PAST PRESIDENT, GULF COAST 
                      COMMUNITY FOUNDATION

    Judge Logsdon. Thank you, Madam Chair.
    Thank you, Congressman Guthrie, for allowing us the 
opportunity to be here and for your coming down and visiting 
with us during hard times.
    I am not here to point fingers or anything like that. I am 
here to state a few things of how our community and others 
surrounding us were in during a state of emergency.
    On Tuesday, January 27th, the ice storm began. Power outage 
began. By the end of the day, the county was 100 percent 
without power. The county lost at least 1,700 utility poles.
    Began to set up shelter at the Grayson County High School 
on the following Wednesday, January 28th. All food donated by 
school system. The shelter was run on generators for five days 
until 2/1/09. All county and city water plants were running on 
generators.
    Thursday, January 29th, one gas station setup to run on 
generators to provide fuel to emergency vehicles and the 
public. Approximately 25 National Guard arrive with no vehicles 
for transportation.
    Leitchfield Sewer Plant regained power on Thursday night. 
Shelter set up at Clarkson Elementary School to provide warm 
meals. All food donated by school system. Local radio station 
finally regained power on Thursday night. Hospital regained on 
Thursday afternoon, all but one building.
    The next day, Friday, January 30th, Leitchfield Utilities' 
water plant regained power. Ran on generators for a total of 
four days under a boil water advisory for 24 hours. Due to 
water system struggles, factories were requested not to begin 
work until Monday, February 2nd, 2009. Caneyville Elementary 
shelter set up to provide warm meals. All food donated by the 
school.
    The next day, Saturday, January 31st, 170 occupants spent 
the night at Grayson County High School shelter. Centre on 
Main, that is our chamber of commerce, opened to hand out food, 
water and necessary supplies. Eastern portion of Grayson County 
without water still. One hundred additional National Guard 
troops arrive with vehicles.
    Sunday, the next day, February 1st, Leitchfield Sewer 
System still has some lift stations running on generators. 
Having to move generators around in order to make sure lift 
stations do not run over. National Guard provided two water 
buffalos to Eastern Grayson County residents.
    The following day, Monday, February 2nd, 2009, Grayson 
County High School shelter closed and occupants were relocated 
to Potter's Hope local church. National Guard began 100 percent 
door to door search for welfare checks on Grayson County 
residents. WRECC reporting approximately 40 percent of power 
restored. Grayson County Water District still running on 
generators. Hospital has 100 percent power.
    The following day, Wednesday, February 4th, 2009, debris 
removal site opened.
    The following day, Thursday, February 5th, WRECC reporting 
approximately 65 percent of power restored. Peanut butter 
recall.
    The following day, Friday, February 6th, nine days after 
the incident, when FEMA came with generators. Closed Potter's 
Hope. Remaining occupants went to hotels, and some went to Cave 
City shelter where we were able to close the shelters due to 
sending some personal heaters so we could get them back in 
their homes.
    The following day, Monday, February 9th, Grayson County 
Schools and our local Christian Academy resumed their normal 
schedules. Garbage collection services resumed their normal 
schedules.
    Notes: 49,172 meals were handed out to Grayson County 
residents during the storm; 5,000 gallons jugs of water were 
handed out; 48,310 bottles of water were handed out; 3,460 
donated to residents for kerosene, propane or fuel to run 
generators and heaters. Total estimated cost of storm is $1.2 
million, not counting our co-op utilities company.
    One of the questions is, do we have local representation 
with FEMA?
    Madam Chair, thank you.
    Ms. Norton. Thank you, Mr. Logsdon. That is a good question 
for us, and we will take it up.
    Mr. Wilder.
    Mr. Wilder. Good afternoon and also thank you for allowing 
me to come here today to speak to you and to the Committee for 
hearing us.
    By way of introduction, I am Rodger Wilder. I am an over 
32-year resident of the Mississippi Gulf Coast, one of the 
founding members of the Gulf Coast Community Foundation, and 
from April of 2006 until November of 2008 I took over the 
operation of the Gulf Coast Community Foundation.
    The Community Foundation during that period of time, with 
the help of a lot of donations, was able to make grants in 
excess of $30 million to people on the Mississippi Gulf Coast 
primarily for hurricane recovery, organizations and 
individuals. Much of that was directed to housing 
redevelopment.
    I want to say a special word of thanks to Congress for the 
support that you have given to the folks in the States of 
Mississippi and Louisiana and Texas and Alabama. We are 
eternally grateful for what you have done for us.
    I am also thankful to the other agencies like FEMA for what 
they have done.
    And, finally, I want to say thank you to the literally 
hundreds of thousands of people who came to the Gulf Coast 
following Katrina to help us, who brought with them materials, 
money, literally hundreds of millions of dollars in money, who 
had such a tremendous outpouring of generosity and support. It 
literally would not have been possible for us to have recovered 
had it not been for their generosity.
    Mr. Guthrie, I noted your comments earlier this morning 
about the generosity of people. My faith in my fellow human 
beings has been renewed and reinforced and elevated to a 
tremendously high level as a result of what I have experienced 
after the storm.
    I sat through the storm, and I have been involved or try to 
be involved in the recovery process primarily in the housing 
area since then. It is my understanding that you all would like 
to know a little bit about what is going on at least in the 
recovery.
    I have not had a lot of contact with FEMA, but I have had a 
lot of contact with trying to get people back into homes. I can 
tell you that we are well on the way to recovery, but our 
recovery is by no means over.
    We still have people in FEMA trailers and in what we call 
Mississippi or MEMA cottages. By and large, the people who are 
in the FEMA trailers are the more difficult, the most difficult 
to place in permanent housing.
    Our biggest problem now is the cost of housing. We do not 
believe that we have a problem with the availability of single-
family homes, but we do have an issue with the availability of 
affordable rental. Following the storm, cost of rental has gone 
up such that many people cannot afford. Many of the people who 
are still in housing supplied by FEMA cannot afford to get into 
permanent housing because it is just too expensive.
    One of the big costs that contributes to both rental and 
single-family ownership, the high cost of single-family 
ownership and rental is the insurance issue. Insurance costs 
are driving those costs up to the point that it is costing two 
and three hundred dollars a month more than it did pre-Katrina, 
and that in turn is just making the rental property not 
affordable to the low income folks with whom my organization 
primarily dealt.
    We need Section 8 vouchers. We need more Section 8 vouchers 
to help get those people out of the FEMA cottages, the FEMA 
trailers, into rentals.
    I will mention briefly we have the alternative housing 
project, what we call the Mississippi cottages, the MEMA 
cottages. I think those have worked well. We have about 2,800 
of those on the Coast. The issue that we have now is whether or 
not those will be allowed to remain permanently, and we hope 
that in certain locations it will.
    Briefly, I want to offer some suggestions not as a 
criticism of what has happened in the past but as a way of 
responding to another large-scale natural disaster. We will 
have another Katrina. There will be another disaster of that 
magnitude.
    We, on the Coast, measured everything by Hurricane Camille 
in 1969. People lost their lives because they said Katrina was 
the worst we have ever suffered. It will never be that bad, and 
they drowned.
    People in Camille lost their lives because they said the 
same thing about the 1947 hurricane.
    We will have this again, and we will have to deal with it 
again. And so, we can say that this is the worst, but it will 
not, I am afraid, be the worst in history.
    As we go forward, I think there needs to be more 
collaboration in advance and after the fact between the non-
profit communities and FEMA. I think we need to do a post-
disaster review, bringing together all of these organizations 
and seeing what worked and what didn't work.
    I think there needs to be an ongoing established 
relationship between FEMA and the non-profit communities in the 
future so that when the next disaster occurs we won't be going 
down there and meeting new friends for the first time.
    I agree with many of the comments that I heard from this 
task force, that there needs to be an agency strike force. They 
need to put folks on the ground who can make decisions and then 
stick by them so that we are not, and this doesn't apply just 
to FEMA. I have to tell you that I think all government 
agencies in a disaster need to have something like a general on 
the ground who can make those things happen. They can make the 
calls, and they can stick by them.
    And, finally, I think that FEMA needs to spend a little bit 
of money. It is really just a piddling amount of money to set 
up and keep going these long-term recovery centers that they 
recommended we set up following the storm that were to 
coordinate the activities of the non-profit communities. They 
got little funding, and they struggled to get their feet under 
them. With a little bit of help, they could have done a lot 
more good than they have.
    The non-profit community on the Coast, to date, has 
rehabbed or rebuilt literally thousands of housings. I think we 
need to be working more closely with organizations like FEMA on 
the front end than we have. And that is not a criticism. That 
is an observation based on the fact that this was a substantial 
disaster.
    Again, I appreciate the opportunity to speak with you. Be 
happy to answer any questions, and I ran way over.
    Ms. Norton. Thank you very much. This has been very, very 
interesting and useful testimony.
    I am going to go first to Mr. Guthrie this time.
    Mr. Guthrie. Thank you, Madam Chairwoman.
    Thanks, Mr. Wilder, for coming. It is nice to hear local 
stories of how people react and have to react, and it is good 
to hear that.
    But with Judge Logsdon, could you kind of just walk us 
through briefly? You knew that the storm came, it hit, and then 
you assessed the damage and realized it was major. It was a 
national emergency.
    Because we are really interested in how the FEMA part of it 
interacted and how that went with FEMA through the first couple 
of days until you got everything working, how that interaction 
between you locally. I know you went through the State with the 
Governor and FEMA.
    Judge Logsdon. Yes, Congressman and Madam Chair.
    When we declared a state of emergency back in 1994 or 
somewhere right there close, we had an ice storm, and it was an 
ice storm that was nothing like what we had this time. It was 
ice on roads. It was no power lines or anything.
    So we didn't focus anything like what was coming. We didn't 
have an idea that we were going to get this. So we woke up that 
morning, and it was popping trees and popping lines and it was 
devastating ice everywhere.
    So we went on. We declared a disaster. We set our EOC up in 
our emergency management headquarters, and you know we have a 
shelter in the courthouse. I said, you know, let's open our 
courthouse because we can get us 15 cots and we can put 20 
people in that courthouse.
    Well, right quick, when they started coming in, we opened 
our high school which we had that available also. So they 
started coming in our high school, and we were getting calls, 
and we hadn't seen anyone from Red Cross.
    We went to our local Wal-Mart. Their electric was off. The 
lights were out. They said, look, we will write down what you 
all need. You all make a list. We will make a list, but you all 
can pay us when you get done.
    So we went into Wal-Mart. We bought around eight to nine 
thousand dollars worth of food. We took it out to our shelters, 
and we set them up and started gathering people and getting 
them in with volunteers of our community working together. So 
we still hadn't seen Red Cross either or heard from FEMA.
    So we went on several days, doing. Every elected official. 
We had magistrates that would get out and haul constituents in 
and different folks with needs. It got pretty hectic for the 
first few days, but we all focused on saving lives, and that is 
what our main goal was, and we did that. We helped everyone.
    Like I said, it went to about the ninth day. We heard FEMA 
was going to send us some generators. They sent two, but there 
was a group. They wouldn't let anybody hook them up, and there 
was a group of electricians came and sat one whole day waiting 
for somebody to show up with them, but they didn't show up. I 
think that was the eighth day.
    Well, we got on the phone, and we got to renting generators 
from other places: Louisville, Bowling Green, everywhere that 
had one available. So we did. We found a few and got our sewer 
plants going.
    We only had one generator in the community, and I know it 
goes back to our preparedness, and we are focusing on our own 
preparedness too. It was the one that did the sewer plant in 
Clarkson.
    So we had to use it, to take it to the bulk plant. We only 
have one bulk plant in our community, to get us fuel so that we 
could have our emergency vehicles and our county and city 
vehicles running to go and transport people. So we did that.
    Then the sewer was backing up. So we had to juggle it, but 
we did do it. It was something that taught us a lot.
    But going back to the FEMA side of it, it is just that I 
heard a Congressman say a while ago when do you activate or 
when do you all move when there is a disaster declared, and 
that is just one of my questions also.
    We kept on working together. Our school was down for about 
two weeks. They were out of school. We used three schools for 
feeding people and shelter.
    We didn't lose any lives because of this ice storm, thank 
the Lord, and we were blessed.
    But we did a lot generator renting, juggling, and one of 
the focuses that could help us is if FEMA, if we could get some 
generators for these facilities that are in need, like our 
water, sewer, and we had a local radio station that we relied 
on.
    We only have one radio station in our little community, and 
it was real vital when it came to letting people know that 
there is a disaster because the first day everybody knew there 
was a problem. Then their power went out. So there wasn't any 
communication.
    The only little communication they had was Bluegrass 
Cellular phones. All of our officials and cities are on 
Cingular. We were down.
    But we all worked together. We kept our calmness, and we 
kept our faith, and we turned something that we all learned a 
lot.
    Mr. Guthrie. Thanks.
    So the FEMA part, we just need them there quicker. We need 
more coordination, I guess, when they come forth. And they did 
say they are looking at the generator situation and a couple 
other things.
    So I appreciate your testimony.
    No further questions, Madam Chairwoman.
    Ms. Norton. Thank you very much, Mr. Guthrie.
    That is very instructive, Judge Logsdon, what you said.
    Let me just say, I do not think a county ought to have to 
buy generators for infrequent events. That is what, 
classically, FEMA is for. It is a lot of money, and these are 
these great big hoggish things. So that goes to preparedness.
    We will have to find out more about the generator issue. 
That is when we met with the Speaker, that was an issue that 
came up time and time again.
    Now let me. I was intrigued by your testimony. It was very 
good testimony, very fact-driven testimony.
    You said, and here I am looking at the outline you provided 
the Committee. On Wednesday, that is the second day, all food 
donated by school system. You say again on Friday, the 30th, 
all food donated by school system. All I can say is thank God 
for the school systems.
    That, again, is a classic FEMA function. The theory is if 
it a national disaster is declared in your county by the 
President of the United States, that two things you are not 
going to have. You are not going to have energy, and you are 
not going to have food.
    Why did FEMA indicate it did not have food when it came on 
those first few days?
    Judge Logsdon. Madam Chair, I don't know that answer 
because we never saw any food. The only thing that we saw was--
--
    Ms. Norton. Ever?
    Judge Logsdon. Not that I am aware of, any FEMA food. We 
had some MREs that came.
    Ms. Norton. MRE.
    Judge Logsdon. Army.
    Ms. Norton. Like they have in the Armed Services.
    Judge Logsdon. Meals ready, yes, and they had the peanut 
butter.
    Ms. Norton. Who gave you those?
    Judge Logsdon. They come through I think Red Cross and 
maybe the National Guard, those MREs, and they had peanut 
butter that we had to break into them and get the peanut butter 
that was in the little packages, that had salmonella in it, and 
get those out.
    But the food, we absorbed all that the schools had, and 
then they knew that this thing was going to last. So they 
opened their freezers, and we got to use their food, and that 
is really a great asset that brought us through.
    Ms. Norton. Very troubling. Very, very troubling that there 
was no food available except it happened that you could get it 
through the school system providing food.
    You also said in your testimony, it looked like the 
National Guard was trying to do the best they could because you 
say 25 National Guard arrived, but there were no vehicles. You 
mean to transport people from place to place like to the 
schools to get the food and stuff like that?
    Judge Logsdon. Yes, Madam Chair.
    Ms. Norton. How did they get there? By the way, Judge 
Logsdon, how did they get there?
    Judge Logsdon. Well, they drove their personal vehicles, 
and we furnished gas for their personal vehicles, the 25 that 
were there, until they found out that they could not use their 
personal vehicles. So they stopped.
    Ms. Norton. Did the Governor declare them to be available 
to you?
    Judge Logsdon. We have a Guard unit, a nice Guard unit in 
our community, in Grayson County.
    Ms. Norton. Right in the county?
    Judge Logsdon. Right in the county, a nice facility, and 
these were local Guardsmen, and they said. They stood the first 
couple days, just doing nothing. Then they said, we can't do 
this. It was bothering them.
    So, finally, that following Saturday, they sent them 100 
more, and then finally they sent four Hummers. One of the 
Hummers, when he started it, he dropped the transmission. So it 
left us three Hummers, and so then they got on the line and 
started getting more troops with more vehicles. But it was 
around four or five days before we saw any vehicles with the 
full Guard.
    Ms. Norton. One of the things we are concerned about is the 
relationship between the National Guard. It looked like, look, 
they saw some problems to be done. They were even locals. So 
they got out there and did what they could even with their own 
local vehicles. That is one reason I love the Guard.
    I love my Guardsmen. They are always ready for us, and we 
lament the fact that so many of them are gone.
    But you said early in your testimony, you asked a question, 
who is supposed to be the local representative to FEMA? That, I 
thought, was a penetrating question, Judge Logsdon.
    To what extent was the State of Kentucky, which has its own 
emergency disaster system, involved with the county?
    Judge Logsdon. Madam Chair, the State pretty much took care 
of the State. On a local level, we had our county and we were 
not only battling the power lines that were falling with over-
ice, we were battling the streets were nothing but ice, and our 
salt trucks were running continuously, trying to salt roads and 
get people where they could even get there once we cut them 
out.
    So we did ask the State to try to get some salt, and the 
State came back and said that they weren't letting any counties 
have any salt. If we ran out of salt, pretty much, we were out 
of salt.
    Ms. Norton. Because they just didn't have enough?
    Judge Logsdon. They had a lot of salt, but they weren't 
releasing it to the county.
    Ms. Norton. You don't know why?
    Judge Logsdon. No, they didn't give no answer.
    Ms. Norton. We will have to find out, because, again, FEMA, 
it seems to me, could have coordinated that or had some salt, 
and I am not sure. We will have to find out what the answer to 
that is. Judge Logsdon, I was interested in your notes: 49,122 
meals were handed out to Grayson County residents during the 
storm; 9,000 gallon jugs of water were handed out; 48,810, or 
thereabouts, bottles of water were handed out. My question is 
by whom?
    Judge Logsdon. Local citizens, local people; and right at 
the end, Red Cross came in to help out. But this was done by 
our local churches, our local volunteers. It was done by 
elected officials; the community.
    Ms. Norton. You know, I am trying to find traces of FEMA 
somewhere here. I see the National Guard--I am talking about in 
Kentucky. I see the National Guard, and my hat is off to them. 
I hear the school system. I hear the Red Cross, a private 
organization. Where was FEMA? At what point did you see or was 
there any indication that FEMA was involved in this ice storm, 
where the President of the United States had declared a 
national emergency?
    Now, I am not sure when--Mr. Guthrie will make me 
understand when it occurred. It wasn't the first day, but 
certainly by the end of the time that you were passing out all 
this stuff it had been declared. Where was FEMA? Did you see 
FEMA?
    Judge Logsdon. Madam Chair, a representative came through, 
but they were passing through, they said, and they just passed 
through. And we were on the phone trying to get help, and then 
we called our Congressman and he came down and he got on the 
phone, and there again he got the thing rolling to where we got 
help.
    But it was about the ninth day before we saw any real 
action of help, and that was the generators, and then they were 
smaller, and by that time we couldn't sit there and just wait, 
wait, wait, or we would have had a disaster, worse than a 
disaster.
    Ms. Norton. So what did you do rather than wait for the 
generators?
    Judge Logsdon. We went to renting to other counties, going 
to Louisville. We went to Louisville, Bowling Green, and 
Nashville, everywhere we could possibly get one that had those 
generators. Our local rock quarry, they do under-mine, they had 
a large generator that they run their mine with, and they let 
us use it to run our shelter for our high school. It had about 
500 people in it at one time.
    Ms. Norton. It sounds like, Judge Logsdon, the county was 
saved by self-help.
    Judge Logsdon. Yes.
    Ms. Norton. And I am including the Guard in that. Have you 
been reimbursed for the meals, the water, the other services 
that the county provided or was the State providing?
    Judge Logsdon. Madam Chair, we are keeping up with all 
documentation, all paperwork. As of right now, we have not been 
reimbursed. You know, as a small local government of a 
population of 24,000, our budget is not very big. There again, 
we would like to ask FEMA, if there is any way, on immediate 
relief for funding such as that, because it would be a great 
help. And I am speaking for the city, also; their budget is not 
large either. So it would be a great help.
    Ms. Norton. Mr. Guthrie had a question before I go on to 
Mr. Wilder.
    Mr. Guthrie. Judge, a point on that. So if you are going to 
spend $1 million, your 13 percent would be $130,000. The 
President has approved 75 percent, and we are looking for a 
waiver. If we could do the waiver, there is a provision they 
could waive the first seven days of costs that would be 100 
percent covered by the Federal Government, and I think that 
would be helpful, because there are a lot of rural counties, 
particularly Judge Logsdon's, that are in that situation.
    Another one has got about 130,000, 140,000 if they have to 
pay locally, which really puts a strain on their budget. So I 
am just encouraging that we go in that direction. I know we 
talked about that in the meeting with the Speaker, and I 
appreciate your help on that.
    Ms. Norton. Well, just let me say for the record, right 
now, Judge Logsdon, that I know I can get Mr. Guthrie to work 
with me. We don't know a State--in fact, the statistics show 
that 50 States are losing jobs. That is why there had to be a 
stimulus package in the first place. The record shows that 
people are laying off vital personnel.
    That is why there were State stabilization funds. Who, 
after all, work for the State? Cops, nurses. Now, I can't 
imagine that a count of 24,000 people was in a position to pick 
up any of FEMA'S costs, and particularly not after the 
President of the United States has declared the same kind of 
national emergency that was declared, after all, in Louisiana 
following Katrina. So if Mr. Guthrie will work with me, I say 
to you that we will do all we can not only to see that you are 
reimbursed, but quickly reimbursed.
    What bothers me is the state of the economy leaving 
anybody--I couldn't stand it in the last witnesses, that there 
was money that could be spent. Well, I certainly can't stand it 
that you spent money in this economy and have not been 
reimbursed.
    Mr. Guthrie?
    Mr. Guthrie. I greatly appreciate that offer to help, and I 
certainly will work with you to do that. That would mean a lot 
to our communities; not just in Kentucky, but Arkansas and 
Missouri, as well.
    Ms. Norton. We don't mean to leave you without questions, 
Mr. Wilder. Indeed, I understand your concern about the 
relationship between FEMA and the nonprofit community. We are 
going to make inquiries about whether or not there can be some 
more systematic relationship. They do have a relationship with 
larger non-profits--Catholic Charities, the Red Cross and so 
forth--but you appear to be a vital community foundation, and 
we will certainly be back to you about that relationship. I 
don't think that would be hard to do. After housing, what would 
you say is the most sought after service that case managers in 
your organization provide advice concerning?
    Mr. Wilder. Probably--and I have to say this is just a 
guess, because I don't know the direct answer to your question. 
But I suspect it is home furnishings, because not only did 
folks on the Gulf Coast lose their homes, but most of them, 
many of them lost everything they owned, including a bed to 
sleep in and clothes to wear. So I would say that probably home 
furnishings are the second most needed thing.
    I might also add that following the storm, we have had a 
serious uptick in mental health problems, as you might imagine, 
having to put that many folks into travel trailers. Not 
criticizing the travel trailers, because they needed someplace 
to live, but they stayed there for a long time because, unlike 
other disasters where there was a place for people to go and 
get out of the disaster area, we were confined or stuck in the 
devastation and had to stay there for a long time. So mental 
health was a big issue. I think it still is a big issue down 
there.
    Ms. Norton. Have you been assured that the trailers where 
people continue to reside are not the trailers that have the 
formaldehyde and the other problems?
    Mr. Wilder. I have not heard in recent months any criticism 
or concern about that. There was, as you know, Madam 
Chairwoman, there was that concern a year or so ago, but as it 
stands now, I believe that problem has essentially been 
resolved.
    Ms. Norton. Now, of course, the root problem, as you said, 
was housing. Now, had to have been extensions. I am informed 
that FEMA'S extension on its housing program is only for 60 
days. Have you been, or any of those you serve been, informed 
of whether that will be extended?
    Mr. Wilder. Well, I saw an email this morning that 
suggested that that might be extended until June. It is a 
little longer than 60 days, I think, but not much longer. And 
the problem, as this Subcommittee knows, is what do you do with 
them? I mean, you can kick them out of what they are in, but 
where are you going to put them?
    And as I said before, the issue of affordable housing is 
critical to, I think, the New Orleans area, and it is certainly 
critical to the Mississippi Gulf Coast area. The cost of 
housing, both rental and single family ownership, has risen to 
the point that people simply cannot afford it. We now also have 
this residential credit crisis that is going on, so even if 
some of these families could afford the rental or, excuse me, 
to buy the home, the monthly payments on the home, they can't 
get credit. So we have been trying to address those issues, but 
they are extremely difficult issues to deal with.
    Ms. Norton. Mr. Wilder, we have some information that the 
local government is opposed to allowing the cottages that you 
spoke of in your testimony to be permanently affixed to lots. 
Would you describe what the problem is? Who is the local 
government? What is the county, what is the locality?
    Mr. Wilder. I think there are only two or three localities 
at this point, local governments, which have agreed to allow 
the Mississippi cottages to be placed permanently.
    Ms. Norton. And what would be their opposition in light of 
the----
    Mr. Wilder. Their opposition is the concern--I think they 
equate FEMA trailers to Mississippi cottages, and they are not. 
There is a huge difference between the two. The Mississippi 
cottages--there are three kinds, as you know, there are one, 
two, and three bedroom units. Those are very well built--I have 
to tell you they are lot better houses than I grew up in--and 
they are good alternatives. But the local governments seem to 
be concerned that, over a period of time, those cottages will 
become slums, and that seems to be the primary opposition.
    Ms. Norton. This is very troubling.
    Mr. Wilder. We are making some progress. I don't want to 
trouble you too much. I am hopeful that we are going to be able 
to work out with some of them.
    Ms. Norton. Well, at least this doesn't look like a FEMA 
problem; it looks like a local government----
    Mr. Wilder. It is a local government problem.
    Ms. Norton.--for its own people, who has not decided. 
Again, if you are getting the government to give you some 
housing has nothing in common, I must say, with a trailer. They 
would rather have the trailers there, because, you know, you 
have to almost ask. You say these people have no place to go 
and you also mention Section 8 vouchers in your testimony. 
Suppose more Section 8 vouchers were available, somehow we 
could get more Section 8 vouchers there. Would there be 
available housing even in that circumstance?
    Mr. Wilder. There are currently being constructed apartment 
complexes. Some of them are affordable; some of them are 
government subsidy programs. So, yes, I believe there will be. 
Unfortunately, the cost of that housing is still--even the 
lower cost of that housing is still more expensive than some of 
the lowest income, disabled, and elderly can afford, and that 
is a problem.
    Ms. Norton. Mississippi has got to face the fact that these 
people are, as it were, now charges of the Federal Government, 
and if they are disabled or extremely low income people, we 
have got to find a way, it looks like, to work with the State 
in this case so that people face the facts about these people.
    At some point, this is the kind of thing, when it lingers 
and lingers, somebody writes a big story, and this time it 
looks like it will be that the State of Mississippi is allowing 
their disabled people or very low income people just to 
languish in trailers. At least there is some affordable housing 
in these cottages. And, again, I will say to you we will look 
into the Section 8 vouchers notion with HUD and with the 
Administration.
    Mr. Wilder. If I may, Madam Chairwoman.
    Ms. Norton. Yes, please.
    Mr. Wilder. Let me make certain that you don't 
misunderstand what I am saying. We are, in Mississippi, 
attempting to make an effort to get these folks into good, 
affordable housing. It has been difficult. It has been 
difficult because of the scope of the disaster, because a lot 
of the lower priced rental and residential property was 
destroyed.
    We in the nonprofit community have done a lot to restore 
that. Our primary focus has been working with the very low 
income, the disabled, the elderly, the single parent families; 
and the State is also attempting, I believe, to do something. 
They have several programs that are underway. To be honest with 
you, sometimes, as you expressed earlier today, the red tape of 
the Federal Government can be awfully red, and we are having 
some trouble working our way through all of those red tape 
issues.
    Ms. Norton. Well, we were very distressed at the last 
hearing on Mississippi. We had what I thought was really 
terrible testimony both from the local officials and from the 
State of Mississippi. We had to intervene in order to get the 
FEMA, I guess it was, housing program extended from Congress, 
because it was another one of those cutoffs. I hate to see 
people go through this and yet I sympathize with the State 
also. After all, housing is a market commodity. So we will have 
to look further.
    I did not understand you to be saying anything differently 
from what you have just described. It is inherent in the 
Mississippi situation, the scope of the disaster, and the sheer 
unavailability, but we had to intervene to get it extended, and 
maybe it is going to come up again.
    Mr. Garratt, would you take the seat? I appreciate that you 
are here again. Would you like to say something about, first, 
the FEMA cottages? It looks like you are willing to let them be 
permanently affixed to the ground, but they have not been. Then 
I would like you to ask about this extension for 60 days and 
whether FEMA intends to ask for yet another extension in light 
of the testimony you have heard from Mr. Wilder.
    Mr. Garratt. Yes, Madam Chairman. First off, I think 
Mississippi has done a fabulous job with the Mississippi 
cottage program. They stood them up in pretty much record time, 
populated them very quickly with deserving disaster victims, 
and has done a very good job of managing that program. I know 
that they are working with their local jurisdictions to try to 
get them to accept them permanently.
    I will reinforce what Mr. Wilder said; they are impressive 
temporary structures, but, in fact, they are much more than a 
temporary structure, and I think this whole pilot program that 
Congress authorized is going to bear some excellent fruit for 
us in this regard. So, yes, we support that and we will stand 
behind them in that regard.
    Ms. Norton. And, of course, they now have trailers as the 
alternative. So I can understand people not wanting trailers, 
but these are little cottages. You know, even when people don't 
want people who are usually not in their community, if you are 
disabled or elderly, normally, people, you can get public 
funding for housing. So I appreciate what you are saying, Mr. 
Garratt.
    Now, the extension that I asked Mr. Wilder about?
    Mr. Garratt. There are no plans, at this stage, to extend 
beyond May 1st. As you know, the Secretary announced that there 
would be a 60-day extension, but at this stage no decision has 
been made to extend beyond that date.
    Ms. Norton. So what do you think should be done with these 
most difficult to place residents on May 1st if there is no 
extension?
    Mr. Garratt. Let me back up just a little bit, Madam 
Chairman. What I would like to do is just paint a little 
context here for how we got to where we are.
    As you know, these are individuals who are largely in 
travel trailers, and you know the issues and the background 
behind the travel trailers; they are very small, and the idea 
that we have had families living in these very small travel 
trailer conditions now for approximately three and a half years 
is problematic for us, as I am sure it is problematic for the 
State of Mississippi, is that is no environment to be living in 
for that period of time. These are designed for recreational 
use, they were never designed to be used for this period of 
time.
    FEMA has, over the course of the last year, offered every 
one of these residents a minimum of three apartment 
opportunities, apartments that are at or near the FMR; and when 
they were initially offered these opportunities, they would 
have been fully subsidized under the DHAP program at the time. 
They rejected that. In many cases these families rolled the 
dice, these households rolled the dice, electing to stay where 
they are, in a fully subsidized travel----
    Ms. Norton. Because they want to go to where they 
originated, is that it?
    Mr. Garratt. A number of issues, Madam Chairman. Some of 
them, the apartments aren't as close as they would like to 
where they are now. All of them would be within 30 to 50 miles, 
these apartments, of where their travel trailer is, but in many 
cases they rejected it.
    Another reason that they were rejected was that they 
recognized that the subsidy in the apartments was going to end 
at some point. In other words, it was designed to step them 
down to become self-sufficient, and some of them elected to 
stay in a fully subsidized travel trailer rather than having to 
begin paying a portion of their own rent down the line.
    We recognize that they are very low income, but at this 
stage of the game we think it is time to demonstrate some 
resolve in this regard, and for those individuals who have been 
reluctant to take that step to self-sufficiency, we think it is 
time to draw a line in the sand and help them in that regard.
    Ms. Norton. Even if they had to be subsidized. I think you 
are right. We can't let people believe that the subsidy is 
going to continue forever. I have serious concerns for some of 
these people, and it is all casework management. People do have 
to understand that FEMA is a disaster agency, not permanent 
housing. This is not HUD.
    And some of these people may qualify for HUD. A whole lot 
of folks in this Country, after a disaster, get to live where 
they never thought they would live or wanted to live. But this 
has to do a lot with case management, and talking some turkey 
to people and then seeing who really has a problem and who does 
not, and whether or not they can be subsidized where they are 
if their concern is very low income and not wanting to use 
that.
    Remember, some of these people were living with somebody, 
like the daughter or the son or someone else, so the whole 
notion of giving a portion of their income for some of them 
would, of course, be seen as a horrific hardship. But, again, 
with the proper case management, allowing people to understand 
where you see that there really is available housing, even if 
it is not where they want to, here I am with Mr. Garratt.
    Mr. Garratt. I just would like to follow up on the case 
management. We have a good partnership with the State of 
Mississippi in that regard. We have been funding a case 
management pilot program in the State of Mississippi. They have 
been doing a very good job with that. We recently authorized 
Mississippi a no-cost extension on that case management program 
through June, or at least until June 1st, so that that will 
take them beyond the May 1st day and to continue working that. 
And we are hopeful, at the end of that case management pilot, 
we are going to learn some lessons from Mississippi and be able 
to potentially apply that to a national model.
    Ms. Norton. Again, Congress had to intervene then in order 
to get the case management extended. But this hearing is 
important, because obviously the first thing you do is 
sympathize with the person who finds out late; and we don't 
want to find this out in April if it is supposed to go out in 
May.
    But we do need to know what Mr. Garratt has told us. It 
looks like some of these people would never leave that trailer, 
even if your Section 8 voucher was available, even if that new 
housing that you see being constructed came available. And, 
again, that is a terrible thing that someone has to face, but 
it was terrible to go to a trailer in the first place. I am not 
sure I want anybody to get used to that, if that is what is 
happening here.
    Mr. Wilder?
    Mr. Wilder. Madam Chairman, I absolutely agree with you. We 
don't want people remaining in the FEMA cottages any longer 
than they have to. It is not good for them; it is not good for 
the community. So I agree with Mr. Garratt that we need to get 
those folks out. The point that I was making did not 
necessarily relate just to the people who were in the FEMA 
trailers. We have many other low-income need housings other 
than what you are talking about here. So what I directed my 
attention to was not only that small group that is still in the 
FEMA cottages, but also the broader low-income group, many of 
whom are not now receiving FEMA benefits.
    Ms. Norton. Well, the Government's responsibility is for 
the ones in the FEMA cottages and the ones in the trailers, and 
it looks like endless extensions do not help us to in fact 
reduce that need.
    Mr. Garratt, I am going to ask you if you would provide the 
Subcommittee with how many move out after the extensions. For 
example, we have had multiple extensions, so if we could have 
figures that show us how many were in these trailers--and for 
that matter, I suppose, cottages, although we should look at 
them separately--and then what the movement was after the 
extension, it would give us some notion of whether people are 
essentially regarding these as, look, I think I would rather 
stay here.
    Because I do not think the Subcommittee would condone that 
if there were available housing and if, for example, as I feel 
motivated now, we were able to get more Section 8 certificates 
there. If one part of the Government is keeping people housed 
and there is another part of the Government--and these are, as 
you know, quite scarce--with Section 8 vouchers, my priority 
would be that the Section 8 vouchers go to the ones who are 
dependent on the Government entirely. So that is something I am 
asking staff to look into.
    Finally, Mr. Garratt, I think I ought to give you the 
opportunity to respond on the Kentucky ice storm, because I 
kept looking for FEMA at all and couldn't much find it. What is 
your view of where FEMA was? Heard National Guard; heard the 
meals; heard the water. Didn't hear any response from FEMA, 
even in terms of reimbursement, despite the fact that Grayson 
County was declared a national emergency. Would you like to 
respond to that?
    Mr. Garratt. I would actually have a difficult time 
responding, Madam Chair, since I was actually out of the 
chamber here through most of that discussion. So not being 
privy to what was being said--and I apologize for stepping 
out----
    Ms. Norton. Well, that's all right. Mr. Guthrie and I have 
agreed together to work to get some reimbursements. It is 
interesting, Judge Logsdon did not bring us a bunch of 
complaints, he brought us an extraordinary set of facts, and he 
indicated who provided what; that the food was provided by the 
school system, the water--so the usual question is, okay, who 
paid for this. And we learned that the county itself paid for 
it, apparently not even the State.
    He also asked a very probing question: what is the 
relationship between a local community, like a county, and 
FEMA. Without asking you to respond, we said we would look into 
that because we are not sure where the State's responsibility 
was here either and where FEMA'S should be. We were concerned 
that in his rendition of the facts we did not hear about FEMA. 
We did hear, of course, about the generator, but even that 
caused some problems.
    As you heard in my opening remarks, what I am concerned 
with is the FEMA be--this may seem unfair, but it is not 
considering the mission of the agency--wherever, whenever FEMA 
is nimble enough to get there. A lot of your problem has been 
this has not been the best funded agency in the United States, 
but these are matters that Mr. Guthrie and I will be bringing 
to your attention.
    Mr. Garratt. No, I would just like to answer one, if I 
understand that, and that is if a county, if a jurisdiction, if 
a city incurs costs taking care of its citizens in a federally 
declared disaster, if they are providing food at shelters, 
those sorts of activities are reimbursable under the Stafford 
Act and they can be reimbursed for those once they fill out a 
project worksheet to get reimbursed for that.
    We are beginning the kickoff meeting process in Kentucky. 
We are actually still just completing PDAs in some of the 
counties in Kentucky. All of that will inform subsequent add-on 
decisions. But bottom line is those are eligible costs, they 
can be reimbursed. There is a process for getting reimbursed. 
Right now that reimbursement rate is at 75/25.
    Ms. Norton. Well, Judge Logsdon told us he runs a tight 
ship. They were keeping record of every cent they paid.
    Judge Logsdon, have you submitted those bills to FEMA, 
since you are eligible now for national disaster aid?
    Judge Logsdon. Madam Chair, I think we were the first 
county, to the best of my memory, that declared a state of 
emergency, the first one, and we have been compiling those. I 
think since then our emergency management coordinator has 
talked with some of the FEMA representatives, and what we are 
hoping for is there immediate relief on payment, where a lot of 
times it takes like a year to get your money reimbursed. We are 
just hoping that there is something like immediate relief up 
front.
    Ms. Norton. Mr. Garratt, this is a county. I wonder if 
there is any way that some advanced payments can be made based 
on the records they have, of payments that are not in dispute 
because they have the records to show.
    Mr. Garratt. Yes, ma'am. We can do an expedited PW. It is 
called immediate needs funding. We can do that for CAT-B, and 
it will provide up to 50 percent of the estimated costs of that 
in advance. Then we will reconcile that down the line. So that 
is an existing policy we have. They have to request that. But 
we are certainly willing and prepared to do that.
    Ms. Norton. That is what a hearing should be all about. 
Problem solved.
    Judge Logsdon, don't leave this room before you have made 
the appropriate arrangements, because Mr. Guthrie and I will be 
following up with you and with Mr. Garratt.
    I want to thank all of our witnesses. If we asked a lot of 
questions, it is because we are trying to understand. I don't 
want anyone to misunderstand my tone. I come to this more as a 
trial lawyer than as a nice Member of Congress, but I am really 
a nice Member of Congress. I am always open to the other side. 
By being open to the other side, I really learned something 
from Mr. Garratt.
    And indeed, what perhaps I find, certainly at this point in 
the hearing, most gratifying is that Mr. Garratt has said to 
Judge Logsdon that he is willing to work on an advanced 
payment, based on the records they have, for at least 50 
percent of what is owed to the county.
    As far as we are concerned, mission completed, at least for 
part of what this hearing was all about. I thank all of you for 
your testimony and for lingering with us while you made us 
understand what we had to learn. Hearing is adjourned.
    [Whereupon, at 1:45 p.m., the Subcommittee was adjourned.]



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