[Congressional Record Volume 153, Number 33 (Tuesday, February 27, 2007)]
[Senate]
[Pages S2276-S2277]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Ms. LANDRIEU:
  S. 690. A bill to amend the Small Business Act to authorize the 
Administrator of the Small Business Administration to waive the 
prohibition on duplication of certain disaster relief assistance; to 
the Committee on Small Business and Entrepreneurship.
  Ms. LANDRIEU. Mr. President, I come to the floor today to highlight 
the ongoing needs of our small businesses and homeowners in the gulf 
coast who were devastated by Hurricanes Katrina and Rita. In Louisiana 
alone, these disasters claimed 1,464 lives, destroyed more than 200,000 
homes and 18,000 businesses and inflicted $25 billion in uninsured 
losses. Many of my colleagues here in the Senate have been down to 
Louisiana and have seen firsthand the size and scope of the 
destruction. The Congress has been very generous in providing billions 
of Federal recovery dollars as well as valuable Gulf Opportunity, GO, 
Zone tax incentives to help spur recovery in the region. These 
resources will be key in the recovery of the region but there are 
additional needs on the ground that still must be addressed. That is 
why I am proud to introduce a bill today, the Catastrophic Disaster 
Recovery Improvements Act of 2007, which I believe, addresses a 
specific problem which is impacting homeowners throughout the gulf 
coast.
  Katrina was the most destructive hurricane ever to hit the United 
States. The next month, in September, Hurricane Rita hit the Louisiana 
and Texas coast. It was the second most powerful hurricane ever to hit 
the United States, wreaking havoc on the southwestern part of my State 
and the east Texas coast. This one-two punch devastated Louisiana 
lives, communities and jobs, stretching from Cameron Parish in the west 
to Plaquemines Parish in the east.
  We are now rebuilding our State and the wide variety of communities 
that were devastated by Rita and Katrina, areas representing a diverse 
mix of population, income and cultures. We hope to restore the region's 
uniqueness and its greatness. To do that, we need to rebuild our local 
economies now and far into the future. We cannot succeed, however, if 
our homeowners are being buried under Federal red tape and regulations.
  The people who work for the Small Business Administration and FEMA 
are dedicated and interested to help in the recovery of our region. 
However, these individuals are operating under a system which is 
inadequate and, in some cases, unresponsive to needs on the ground.
  I come to the floor today to introduce a bill which provides a 
commonsense solution to get the Federal assistance to our struggling 
homeowners. If we don't help them now, building a strong gulf coast 
will be all the more difficult if residents cannot rebuild their homes 
and businesses cannot open their doors.
  For homeowners in Louisiana, the State is doing its part by setting 
up the Louisiana Road Home program, to provide homeowners with up to 
$150,000 in grant proceeds for uninsured losses on their properties. 
This program is State-administered, but supplemental CDBG-funded. 
However, many applicants are concerned because under the Stafford and 
Small Business Acts, the SBA is required to ensure there are no 
``duplication of benefits'' provided to disaster victims. This means 
that SBA must review every file which received an SBA Disaster Loan, 
and if there is deemed to be duplication, deduct the

[[Page S2277]]

duplication amount from the grant proceeds. As I said, I want the SBA 
to ensure taxpayers funds are used wisely, but at the same time, I want 
to ensure that all residents are able to get the funds they need to 
rebuild their homes.
  Under the current scenario, some residents who have additional 
uninsured losses, are being required to still pay back these grant 
proceeds. This is because many SBA loss inspections were done right 
after the storms in 2005, but since then building/labor costs have 
increased dramatically, and this is not reflected in the SBA verified 
loss. Borrowers are able to request a loan modification from SBA, but 
many residents who waited months and months for SBA to respond are wary 
to go through the process again, especially if there is a prospect they 
will be declined for the increased loan amount. I can't blame them 
because there is enough uncertainty down there right now. Personally, I 
would also be hesitant to go through the SBA loan process again if I 
had to fill out as much paperwork as my constituents have had to fill 
out, and to receive constant requests for more information once they 
think they are done with submitting information.

  For this reason, this bill provides the SBA administrator the 
flexibility to waive, partially or fully at the discretion of the 
administrator, this ``duplication of benefits'' rule. This provides 
borrowers with additional funds for rebuilding while retaining the 
Federal Government's financial responsibility to taxpayers. I believe 
this commonsense fix for major disasters corrects a major problem 
occurring in Louisiana right now and gives SBA some flexibility for 
future major disasters. The current SBA interpretation of these 
regulations overlooks the fact that a grant, with no repayment, has a 
different value to homeowners than loans, which require repayment. In 
effect, disaster victims are being penalized for getting an SBA loan 
before they received their Road Home grant and that is not how the 
Federal Government should respond to victims, who in many cases, lost 
everything. We should not allow victims to ``double-dip'' or benefit 
from the disaster, but the Federal Government should be responsive to 
needs on the ground and adjust as necessary to allow disaster victims 
to fully recover.
  In introducing this bill today, I am hopeful it sends the signal to 
gulf coast residents that Congress has not forgotten about them and 
that we are doing our part to reduce red tape and bureaucracy. Congress 
did a great deal during the 109th Congress to help victims of the 2005 
storms, but that does not mean we should just write off recurring 
problems to the responsibility of States or disaster victims 
themselves. I believe that both the leadership on the Senate Committee 
on Small Business and Entrepreneurship as well as the new SBA 
administrator, Steve Preston, are receptive to addressing ongoing needs 
in the gulf coast. I look forward to working closely with them in the 
coming weeks to provide substantive and lasting solutions for our small 
businesses and homeowners.
  I urge my colleagues to support this important legislation and ask 
unanimous consent that the text of the legislation be printed in the 
record.
  There being no objection, the text of the bill was ordered to be 
printed in the Record, as follows:

                                 S. 690

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. SHORT TITLE.

       This Act may be cited as the ``Catastrophic Disaster 
     Recovery Improvements Act of 2007''.

     SEC. 2. WAIVER OF PROHIBITION ON DUPLICATION OF CERTAIN 
                   BENEFITS.

       (a) In General.--Section 7(b) of the Small Business Act (15 
     U.S.C. 636(b)) is amended by inserting immediately after 
     paragraph (3) the following:
       ``(4) Waiver of prohibition on duplication of certain 
     benefits.--For any major disaster (as that term is defined in 
     section 102 of the Robert T. Stafford Disaster Relief and 
     Emergency Assistance Act (42 U.S.C. 5122)), in providing 
     assistance under paragraph (1) or (2), the Administrator may 
     waive, in whole or in part, the prohibition on the 
     duplication of benefits, including whether damage or 
     destruction has been compensated for by, credit is available 
     from, activities are reimbursable through, or funds have been 
     made available from any other source.''.
       (b) Applicability and Retroactivity for Victims of 
     Hurricanes Katrina, Rita, and Wilma.--The amendment made by 
     this section shall apply to any assistance under section 7(b) 
     of the Small Business Act (15 U.S.C. 636(b)) provided on or 
     after August 29, 2005.
                                 ______