[Congressional Record Volume 152, Number 125 (Friday, September 29, 2006)]
[Senate]
[Pages S10664-S10665]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
DISASTER ASSISTANCE REFORMS
Ms. LANDRIEU. Mr. President, like many in Congress, I am disappointed
that we are adjourning Congress for the October recess without enacting
comprehensive U.S. Small Business Administration disaster assistance
reforms. As our small businesses impacted by Hurricanes Katrina and
Rita last year can attest, this is an agency that is in woeful need of
substantive reforms to its Disaster Assistance Program. Our businesses
had to wait 4 to 6 months for SBA disaster loans to be approved, and
some are still waiting to this day, for loan amounts to be disbursed.
For my part, I have worked for the past year to enact substantive SBA
disaster reforms to ensure that `lessons learned' from Katrina and Rita
were incorporated and that businesses nationwide could count on a
better prepared and more efficient SBA should a disaster strike their
community. Under the leadership of the chair and ranking member of the
Senate Small Business Committee, Senators Olympia Snowe and John Kerry,
we sent to the Senate floor bipartisan legislation, S. 3778, which
along with reauthorizing SBA programs, also enacts comprehensive SBA
disaster reforms. Instead of working with us to take up and pass this
important bill, the administration has frustrated this bill's passage
at every turn and will not allow it to the Senate floor for
consideration--almost 9 weeks after it was introduced. I am concerned
about this lack of urgency from the SBA and the administration so just
this week, I sent a letter to the new SBA Administrator Steve Preston.
In this letter, I requested his cooperation with our committee to pass
this important legislation before Congress adjourns at the end of the
year.
I will ask that a copy of this September 27, 2006, letter be printed
in the Record.
As we adjourn tonight, I note that we are set to pass legislation
which temporarily extends programs under the Small Business Act until
February 2, 2007. Although I do believe it is essential to extend these
SBA programs, I worked with my colleague Senator Kerry to revise this
date to November 17, 2006. This November date would have ensured that
the Congress would have to return in November and at least attempt to
pass SBA Disaster reforms. Instead, with these programs authorized
through February 2, 2007, the Congress will adjourn in September 2006
and not take up SBA reauthorization until at least February 2007. I am
disappointed by this development because, as elected officials, I
believe it sends the wrong signal to our small business community.
If the Congress, in partnership with the SBA, does not address these
systemic problems now, I am afraid that it will continue to plague the
SBA's disaster response for future disasters. I believe there is a
general consensus that these reforms need to get done. Therefore, I
will continue my work with my colleagues from sides of the aisle to
make these essential improvements this year.
Mr. President, I ask unanimous consent that the letter to which I
referred be printed in the Record.
There being no objection, the material was ordered to be printed in
the Record, as follows:
U.S. Senate,
Washington, DC, September 27, 2006.
Hon. Steven C. Preston,
Administrator, U.S. Small Business Administration,
Washington, DC.
Dear Administrator Preston: Let me take this opportunity to
again congratulate you on your confirmation as Administrator
of the U.S. Small Business Administration (SBA). Your
management experience and passion to serve will prove
extremely helpful to you in this challenging position.
I write you today because, as a member of the Senate
Committee on Small Business and Entrepreneurship, as well as
senator from a state hit hard by both Hurricanes Katrina and
Rita, I believe it is my duty to ensure that we implement
substantive changes to SBA's Disaster Assistance Program
during this session of Congress.
The SBA's response to Hurricanes Katrina and Rita was too
slow and lacking in urgency-threatening the very survival of
our affected businesses. A year has passed since Hurricanes
Katrina and Rita, yet while Congress is currently acting on
extensive reforms for the Federal Emergency Management Agency
(FEMA), there has been only incremental changes to SBA's
Disaster Assistance Program. That is why I am pleased to
learn that you have recently created the Accelerated Disaster
Response Initiative to identify and help implement process
improvements to enable the SBA to respond more quickly in
assisting businesses and homeowners in need of assistance
after a disaster. I applaud these efforts and your leadership
on this issue. But much more must be done to address the
systemic problems that led to delays and inaction post-
Katrina and Rita.
For our part, the Senate is also attempting to address the
multiple problems that hampered SBA's ability to assist
impacted Gulf Coast small businesses and homeowners. Under
the leadership of the Chair and Ranking Member of the Senate
Committee on Small Business and Entrepreneurship, Senators
Snowe and Kerry, the committee voted unanimously to approve
S. 3778, the ``Small Business Reauthorization and
Improvements Act of 2006'' and sent it to the full Senate for
consideration. A copy of the bill is attached for your
convenience. This bipartisan legislation re-authorizes SBA
programs, and also of great importance to me and my
constituents, makes essential reforms to SBA's Disaster
Assistance Program. However, Since S. 3778 was introduced on
August 2, 2006, almost nine weeks ago, it has been blocked
from consideration and the Committee is still waiting for
budget information so that it may file its report on the
bill. It is my understanding that the administration and SBA
has several concerns about this bill in its current form.
I am very concerned at this apparent deadlock, a deadlock
which threatens our bipartisan efforts to implement
comprehensive SBA Disaster Assistance reforms before the end
of the year. In particular, I believe that there must be SBA
reforms in the following areas:
Short-Term Assistance: Following Katrina and Rita small
businesses waited, on average, four to six months for
approvals and disbursements on SBA Disaster Loans. In order
to ensure the long-term survival of small businesses impacted
by a catastrophic disaster, SBA needs to be in the business
of short-term recovery-by providing either emergency bridge
loans or grants.
Disaster Loan Process for Homeowners: While SBA's mission
is to ``aid, counsel, assist and protect, insofar as is
possible, the interests of small business concerns'' it also
has the added responsibility of helping affected homeowners
rebuild their housing post-disaster. Katrina and Rita
resulted in record numbers of SBA Disaster Loan applications
from homeowners, which strained SBA's existing resources and
personnel. If the SBA must bear this responsibility, the
agency should improve the process as well as possibly seek
greater coordination and cooperation with the U.S. Department
of Housing and Urban Development on disaster housing
assistance.
Expedited Disaster Loans to Businesses: The SBA currently
has no mechanism in place to expedite Disaster Loans to
impacted businesses that are either a major source of
employment or that can demonstrate a vital contribution to
recovery efforts in the area, such as businesses who
construct housing, provide building materials, or conduct
debris removal. The SBA need the ability to fast-track loans
to these businesses, in order to jumpstart local economies
and recovery efforts.
[[Page S10665]]
Economic Injury Disaster Loans: Although Katrina and Rita
directly affected businesses along the Gulf Coast, additional
businesses in the region, as well as the rest of the country,
were economically impacted by the storms. The SBA must have
the ability to provide nationwide, or perhaps regional,
economic injury disaster loans to businesses which can
demonstrate economic distress or disruption from a future
major disaster.
Loss Verification and Loan Processing: Following the Gulf
Coast hurricanes, the SBA struggled for months to hire enough
staff to inspect losses and process loan applications.
Although SBA now has trained reserves to handle such surges
in demand, the SBA also needs the permanent authority to
enter into agreements with qualified private lenders and
credit unions to process Disaster Loans and provide loss
verification services.
Administrator Preston, I was impressed by your expressed
willingness to be a bridge between Congress and the White
House. For the SBA to truly bring its disaster capabilities
to the next level, I believe that it must work in concert
with the Congress. Together, we must remove layers of
bureaucracy and red tape, which, following Katrina and Rita,
both overwhelmed and frustrated dedicated SBA employees and
those affected by the hurricane must also give the SBA new
tools to ensure that problems that occurred post-Katrina and
Rita never happen again.
Last month we marked the one-year anniversary of Hurricane
Katrina, and now mark the one-year anniversary of Hurricane
Rita. It is essential that we take action now to make
substantive reforms to the SBA Disaster Assistance Program.
We owe nothing less to our small businesses. I ask that you
continue working with my office on this important issue and
respond to our approach in writing no later than October 31,
2006. This will help us develop a proposal which can address
the concerns of the SBA as well as provide a better and more
responsive SBA Disaster Assistance Program for our small
businesses.
Thank you in advance for your assistance with this request.
Sincerely,
Mary L. Landrieu,
U.S. Senator.
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