[Congressional Record Volume 154, Number 72 (Friday, May 2, 2008)]
[Senate]
[Pages S3744-S3747]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. REID (for Ms. Landrieu (for herself, Mr. Cochran and Mr. 
        Wicker)):
  S. 2975. A bill to provide additional funds for affordable housing 
for low-income seniors, disabled persons, and others who lost their 
homes as a result of Hurricanes Katrina and Rita; to the Committee on 
Banking, Housing, and Urban Affairs.
  Ms. LANDRIEU. Mr. President, I come to the floor today to speak on 
behalf of some of our most in need gulf coast residents impacted by 
Hurricanes Katrina and Rita. As you know the gulf coast was devastated 
in 2005 by two of the most powerful storms to ever hit the U.S. in 
recorded history--Hurricanes Katrina and Rita. We also experienced the 
unprecedented disaster of having a major metropolitan city--the City of 
New Orleans--under up to 20 feet of water for two weeks when there were 
28 separate levee failures which flooded 12,000 acres, or 80 percent of 
New Orleans, following Katrina.
  In particular, I am speaking on behalf of our elderly and disabled 
residents impacted by these disasters. Many of these people are too 
frail or fragile to live on their own, yet they do not belong in a 
hospital. We have many people who been in seen homes or apartments for 
disabled and elderly residents, for adults who are not older but 
instead disabled through an accident or injury. In many cities, this 
type of housing is run by such organizations as Catholic Charities or 
other nonprofits. Right now in the gulf coast region, we desperately 
need more of this type of housing to take care of the most fragile 
people who either are without shelter or are without safe, affordable 
shelter with appropriate supportive services. One can imagine the 
challenges of providing sufficient housing for this group under normal 
circumstances. But here we find ourselves, dealing with the aftermath 
of a catastrophe, trying to provide additional housing for thousands of 
people now returning to the region.
  According to the Congressional Research Service, 88,000 persons aged 
65 or older were displaced by Hurricane Katrina--of that group 45,000 
were 75 years of age or older. Furthermore, almost 15 percent of all 
displaced seniors had incomes below the poverty line. While recovery 
has primarily focused on restoring owner-occupied and rental housing, 
U.S. Department of Housing and Urban Development, HUD, assisted housing 
for our elderly and disabled residents has not received a great deal of 
attention. In particular, 123 properties of Section 202 housing, which 
serves elderly residents, and Section 811 housing, which serves 
disabled residents, were impacted by Hurricanes Katrina and Rita in my 
State alone. This includes 5,261 total units of 202/811 housing. As of 
February 2008, 602 of these units were still offline and I am aware 
that, for every unit of 202 housing, there are 10 eligible low-income 
seniors on the waiting list.
  To further highlight the ongoing needs of the gulf coast, let me 
provide a snapshot of one community in my State--New Orleans East. In 
our Vietnamese community in New Orleans East, 6,000 people--or 
approximately 95 percent of the pre-Katrina population--have returned 
to the area. Of this 6,000,

[[Page S3745]]

it is estimated that 2,400 are seniors. The average age of these 
seniors is 72 years of age and 98 percent are considered extremely low-
income according to HUD standards. This means that they earn below 30 
percent of the area median income a year, or less than $12,550 a year. 
Of these seniors 82 percent receive supplemental security income as 
their only source of income--approximately $637 per month for a single 
household.
  Prior to Katrina, there were six retirement communities in New 
Orleans East, consisting of about 735 units, serving this community. 
Presently none of them are in operation. This is not just a short-term 
recovery problem as the demand for age-restricted housing will continue 
to increase in the next few years, particularly in New Orleans East.

  Given the ongoing needs in the southern part of my State in regard to 
damaged multifamily and senior/disabled housing, as well as all across 
the Gulf Coast, I am proud to introduce today the Gulf Coast 
Multifamily and Assisted Housing Recovery Act of 2008. I am joined on 
this bill by my colleagues Senator Thad Cochran and Senator Roger 
Wicker. This legislation includes some key provisions which should 
target assistance where it is most needed. The bill will also help to 
cut through some Federal red tape stalling redevelopment efforts in the 
region.
  To address the affordable housing needs in my State, as well as 
across the gulf coast, our bill authorizes $125 million for additional 
Section 202 housing and $75 million for new Section 811 housing. This 
provision would create almost 1,500 new 202/811 units. The bill would 
also authorize $4 million to cover gaps for the redevelopment of former 
Section 202 housing in the City of New Orleans and St. Bernard Parish.
  Another major problem in New Orleans East is that 50 seniors were 
living pre-Katrina at Versailles Arms, a project-based Section 8 
housing development which has not reopened. I understand that a few 
weeks ago the community boarded up the development. While this property 
is sitting vacant--but vacant with a project-based contract still 
attached to it--Mary Queen of Viet Nam Community Development 
Corporation, MQVN, and Providence Community Housing have begun work on 
Phase I of the Mary Queen of Viet Nam Retirement Community. This 
project would provide 84 units of affordable senior housing. Their 
problem, however, is with the downturn in the tax credit market in the 
last 4 months, the equity investment will not be sufficient to cover 
the development costs. For example, the current rent structure, which 
is below the market rates, is not sufficient to support a mortgage to 
cover the development gap, so they are in need of a project-based 
subsidy to complete the project.
  MQVN have been trying to work with our local housing authority, the 
Housing Authority of New Orleans, HANO, to secure project-based 
assistance for this project. However, as many of our developers have 
discovered, HANO has exhausted its 20 percent maximum set aside for 
project-based subsidies. This is troubling for those of us in Congress, 
especially for my colleagues and I who are members of the Senate 
Appropriations Committee. Last year, via the fiscal year 08 
Supplemental Appropriations bill, we provided HANO with additional 
vouchers by allowing HUD to utilize pre-Katrina population figures in 
allocating Section 8 vouchers, rather than post-Katrina population 
figures. While there certainly are increased demands for such 
assistance, the fact that so many developments are in need of this type 
of assistance and that HANO lacks the necessary resources to fully 
address needs on the ground raises many questions. For my part, I do 
not have all the answers but I can provide a commonsense solution to 
address the need for project-based assistance in New Orleans and the 
rest of the gulf coast.
  Each year, in the Transportation, Housing and Urban Development 
Appropriations bill, there has regularly been legislative authority for 
HUD to transfer some or all project-based assistance associated with 
one or more multifamily housing projects to another multifamily housing 
project or projects. In the fiscal year 06 Appropriations bill, Public 
Law 109-115, Section 318 addressed this issue, and in the fiscal year 
08 Omnibus Appropriations bill, Public Law 110-161, which passed the 
Congress in December 2007, this language was contained in Section 215. 
While this language is discretionary, not mandatory, it does provide 
HUD with the legislative authority to transfer project-based assistance 
from a damaged or vacant property to another property, with certain 
restrictions. However, as I mentioned, this annual language is 
discretionary so HUD is not required to review and approve transfer 
requests. This has proven to be the main obstacle for housing 
organizations. Some of these properties have been destroyed and, rather 
than asking for new project-based contracts, the developers simply want 
to transfer the existing ones to new buildings. This would maximize 
existing resources, and in many cases, could help communities build 
housing which could better resist future disasters.

  While HUD currently has this transfer authority, there have been 
numerous instances post-Katrina where HUD has failed to quickly 
implement such transfers. For example, Mississippi Methodist Senior 
Services, MMSS, is a nonprofit which, despite testifying before 
Congress last year, ended up having its Section 318 transfer request 
rejected by HUD. It subsequently lost 65 units of elderly housing. This 
is even more troubling as MMSS was the first non-profit in Mississippi 
to provide affordable housing for seniors. So this is a group with 
extensive experience in senior housing--one with deep roots in the 
community. The nonprofit had seven properties throughout the State, 
serving 1,800 seniors daily. One of its properties in Biloxi had 
significant wind damage and suffered 2 feet of Gulf water on the first 
floor. Upon further inspection, there was additional damage found and 
their insurance company determined it would only cover repairs on the 
first floor. This left MMSS with an uninhabitable building and a $1 
million gap between insurance and the amount that was necessary for 
repairs.
  To redevelop the property and provide badly needed housing, MMSS 
intended to transfer the 65 units of project-based assistance to a new 
site further inland. The new site would be in a better position to 
avoid gulf coast waves and weather patterns. As with most gulf coast 
groups in this situation, MMSS submitted a Section 318 request and 
started working with HUD to prepay the existing mortgage, sell the 
property, and transfer the Section 8 contract. However, in December 
2006, HUD eventually refused the transfer, forcing MMSS to abandon the 
contract and sell the property. This resulted in the loss of housing 
for 65 elderly families. Our observation of these failures has led us 
to believe there is a need for Congress to enact stronger legislation 
on this issue.
  To address this issue, the legislation I am introducing would tackle 
this problem in three important ways. First, this bill would require 
HUD to maintain project-based contracts in declared Katrina and Rita 
areas until the date specified in the contract or not less than 3 
months after the property is made habitable. This provision would 
ensure that there is no loss of current project-based contracts. Next, 
the bill would require HUD to review and approve any feasible transfer 
proposal made by owners of damaged/destroyed multifamily housing. The 
language in this bill tracks Section 215 language from the fiscal year 
08 Omnibus, except that we limit this requirement for Alabama, 
Mississippi, and Louisiana and sunset it on October 1, 2009. These 
restrictions are to ensure that it is strictly for recovery purposes. 
Lastly, to get a full picture of the number of units that may have been 
lost, the bill requires that HUD report to Congress on the number and 
location of project-based contracts which have been cancelled since the 
storms. These key provisions would make a real difference not only for 
MQVN in New Orleans East but for countless providers of multifamily 
housing across the gulf coast.
  As chairman of the Homeland Security Subcommittee on Disaster 
Recovery, I have been working with my Senate colleagues to push for 
better Federal Government disaster preparedness. Therefore, in addition 
to addressing current needs on the gulf coast, the bill also looks 
forward to future disasters. This bill requires that, not later than 
June 1, 2008--the start of the 2008 Atlantic Hurricane season--that HUD

[[Page S3746]]

provide Congress with a disaster response plan for HUD-assisted Section 
202/811 properties. A number of recommendations have been made to HUD 
by the affordable housing community on regulatory waivers and funding 
gaps that the agency will face in future disaster situations. There is 
no reason that HUD, or Congress for that matter, should have to expend 
future resources, time, and energy to address some of the similar 
issues which this bill is attempting to address for Katrina and Rita 
areas. Lessons learned from Katrina and Rita have been well documented 
by Congress. It is now time that HUD improves its preparedness and 
response to disasters which could impact assisted properties.
  In closing, let me reiterate that this bill addresses one of the most 
fundamental needs following a disaster: the need to return home. For 
our elderly and disabled residents, a safe and affordable home is even 
more essential. Many gulf coast residents lost homes, family members, 
and pets, among other things. It is our obligation as a city, county/
parish, State, and as a nation to help. So I am here today, for my 
part, to try to put forward legislation which I strongly believe will 
make a real difference for those most in need in the gulf coast region. 
I urge my colleagues to support this bipartisan recovery legislation as 
these disaster victims are counting on the United States Senate for 
action.
  Mr. President, I ask unanimous consent that the text of the bill and 
supplemental material be printed in the Record.
  There being no objection, the material was ordered to be printed in 
the Record, as follows:

                                S. 2975

       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 ``Gulf Coast Multifamily and 
     Assisted Housing Recovery Act''.

     SEC. 2. ADDITIONAL SUPPORT FOR HOUSING LOW-INCOME ELDERLY 
                   PERSONS.

       Section 202 of the Housing Act of 1959 (12 U.S.C. 1701q) is 
     amended by adding at the end the following:
       ``(n) Additional Support for Low-Income Elderly Persons 
     Displaced by Hurricanes Katrina and Rita.--
       ``(1) In general.--In addition to any amounts authorized 
     under subsection (m), for fiscal year 2009 there is 
     authorized to be appropriated $125,000,000 to the Secretary 
     to provide assistance pursuant to this section to private 
     nonprofit organizations and consumer cooperatives to expand 
     the supply of supportive housing for low-income elderly 
     persons--
       ``(A) who on August 28, 2005, for Hurricane Katrina and 
     September 24, 2005, for Hurricane Rita, were residents in a 
     designated disaster area;
       ``(B) whose primary residence--
       ``(i) was significantly damaged by Hurricane Katrina or 
     Hurricane Rita or by flooding resulting from Hurricane 
     Katrina or Hurricane Rita; or
       ``(ii) is uninhabitable as a result of damage or flooding 
     resulting from Hurricane Katrina or Hurricane Rita, including 
     uninhabitability resulting from lack of electricity, water, 
     or other services due to such damage or flooding; and
       ``(C) who cannot, in the discretion of the Secretary, 
     afford to rebuild such residence.
       ``(2) Allocation of funds.--Of the amounts authorized to be 
     appropriated under paragraph (1), the Secretary shall 
     allocate--
       ``(A) $55,000,000 to the State of Louisiana;
       ``(B) $50,000,000 to the State of Mississippi; and
       ``(C) $20,000,000 to the State of Alabama.
       ``(3) Definition.--As used in this subsection, the term 
     `designated disaster area' means any area in the States of 
     Alabama, Mississippi, and Louisiana that was the subject of a 
     disaster declaration by the President under title IV of the 
     Robert T. Stafford Disaster Relief and Emergency Assistance 
     Act (42 U.S.C. 5121 et seq.) in response to Hurricanes 
     Katrina and Rita of 2005.''.

     SEC. 3. ADDITIONAL SUPPORT FOR LOW-INCOME PERSONS WITH 
                   DISABILITIES.

       Section 811 of the Cranston-Gonzalez National Affordable 
     Housing Act (42 U.S.C. 8013) is amended by adding at the end 
     the following:
       ``(o) Additional Support for Low-Income Persons With 
     Disabilities Displaced by Hurricanes Katrina and Rita.--
       ``(1) In general.--In addition to any amounts authorized 
     under subsection (m), for fiscal year 2009 there is 
     authorized to be appropriated $75,000,000 to the Secretary to 
     provide assistance pursuant to this section to private, 
     nonprofit organizations to expand the supply of supportive 
     housing for persons with disabilities--
       ``(A) who on August 28, 2005, for Hurricane Katrina and 
     September 24, 2005, for Hurricane Rita, were residents in a 
     designated disaster area;
       ``(B) whose primary residence--
       ``(i) was significantly damaged by Hurricane Katrina or 
     Hurricane Rita or by flooding resulting from Hurricane 
     Katrina or Hurricane Rita; or
       ``(ii) is uninhabitable as a result of damage or flooding 
     resulting from Hurricane Katrina or Hurricane Rita, including 
     uninhabitability resulting from lack of electricity, water, 
     or other services due to such damage or flooding; and
       ``(C) who cannot, in the discretion of the Secretary, 
     afford to rebuild such residence.
       ``(2) Allocation of funds.--Of the amounts authorized to be 
     appropriated under paragraph (1), the Secretary shall 
     allocate--
       ``(A) $35,000,000 to the State of Louisiana;
       ``(B) $25,000,000 to the State of Mississippi; and
       ``(C) $15,000,000 to the State of Alabama.
       ``(3) Definition.--As used in this subsection, the term 
     `designated disaster area' means any area in the States of 
     Alabama, Mississippi, and Louisiana that was the subject of a 
     disaster declaration by the President under title IV of the 
     Robert T. Stafford Disaster Relief and Emergency Assistance 
     Act (42 U.S.C. 5121 et seq.) in response to Hurricanes 
     Katrina and Rita of 2005.''.

     SEC. 4. TARGETED HOUSING SUPPORT FOR LOW-INCOME ELDERLY 
                   PERSONS IN NEW ORLEANS AND ST. BERNARD PARISH.

       There is authorized to be appropriated for the 
     redevelopment (rebuilding or replacement) of housing 
     authorized under section 202 of the Housing Act of 1959 (12 
     U.S.C. 1701q) which was damaged or destroyed as a result of 
     Hurricane Katrina of 2005--
       (1) $2,500,000 to the City of New Orleans; and
       (2) $1,500,000 to the Parish of St. Bernard.

     SEC. 5. USE OF BUDGET-BASED RENT INCREASES FOR SECTION 202 
                   AND 811 PROJECTS IN A DESIGNATED DISASTER AREA.

       (a) Section 202.--Section 202 of the Housing Act of 1959 
     (12 U.S.C. 1701q), as amended by section 2, is further 
     amended by adding at the end the following:
       ``(o) Approval of Rent Increases.--
       ``(1) In general.--The Secretary shall annually adjust the 
     rent levels on a budget-based basis of eligible projects to 
     support the increased cost of operating or rehabilitating 
     such projects.
       ``(2) Conditions.--Rent adjustments pursuant to this 
     section shall--
       ``(A) be subject to adjustment by the Secretary based on 
     differences between estimated and actual costs of operating 
     or rehabilitating such projects; and
       ``(B) not exceed the rent for comparable unassisted units 
     in the area.
       ``(3) Definitions.--As used in this section--
       ``(A) the term `eligible project' means a project that is--
       ``(i) assisted under subsection (c)(2); and
       ``(ii) located in a designated disaster area; and
       ``(B) the term `designated disaster area' means any area in 
     the States of Alabama, Mississippi, and Louisiana that was 
     the subject of a disaster declaration by the President under 
     title IV of the Robert T. Stafford Disaster Relief and 
     Emergency Assistance Act (42 U.S.C. 5121 et seq.) in response 
     to Hurricanes Katrina and Rita of 2005.''.
       (b) Section 811.--Section 811 of the Cranston-Gonzalez 
     National Affordable Housing Act (42 U.S.C. 8013), as amended 
     by section 2, is further amended by adding at the end the 
     following:
       ``(p) Approval of Rent Increases.--
       ``(1) In general.--The Secretary shall annually adjust the 
     rent levels on a budget-based basis of eligible projects to 
     support the increased cost of operating or rehabilitating 
     such projects.
       ``(2) Conditions.--Rent adjustments pursuant to this 
     section shall--
       ``(A) be subject to adjustment by the Secretary based on 
     differences between estimated and actual costs of operating 
     or rehabilitating such projects; and
       ``(B) not exceed the rent for comparable unassisted units 
     in the area.
       ``(3) Definitions.--As used in this section--
       ``(A) the term `eligible project' means a project that is--
       ``(i) assisted under subsection (d)(2); and
       ``(ii) located in a designated disaster area; and
       ``(B) the term `designated disaster area' means any area in 
     the States of Alabama, Mississippi, and Louisiana that was 
     the subject of a disaster declaration by the President under 
     title IV of the Robert T. Stafford Disaster Relief and 
     Emergency Assistance Act (42 U.S.C. 5121 et seq.) in response 
     to Hurricanes Katrina and Rita of 2005.''.

     SEC. 6. PRESERVATION AND PROVISION OF PROJECT-BASED HOUSING 
                   FOR AFFORDABLE HOUSING UNITS DAMAGED OR 
                   DESTROYED BY HURRICANES KATRINA OR RITA.

       (a) Report on Terminated Project-Based Contracts in 
     Designated Disaster Area.--Not later than 45 days after the 
     date of enactment of this Act, the Secretary of Housing and 
     Urban Development shall provide a report to the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives detailing--
       (1) information on the number of project-based assistance 
     contracts and units which were terminated in the designated 
     disaster area after September 30, 2005;
       (2) information on the specific developer, project name, 
     location, number of units, and

[[Page S3747]]

     project description for each project-based assistance 
     contract which was terminated in the designated disaster area 
     after September 2005; and
       (3) such additional information as the Committee on 
     Banking, Housing, and Urban Affairs of the Senate and the 
     Committee on Financial Services of the House of 
     Representatives shall reasonably require.
       (b) Tolling of Contract Term.--
       (1) In general.--Notwithstanding any other provision of 
     law, a project-based assistance payments contract for a 
     covered assisted multifamily housing project shall not expire 
     or be terminated because of the damage or destruction of 
     dwelling units in the project as a result of Hurricane 
     Katrina or Hurricane Rita.
       (2) Expiration date.--The expiration date of the contract 
     for a covered assisted multifamily housing project described 
     under paragraph (1) shall be deemed to be the later of--
       (A) the date specified in the contract; or
       (B) the date that is not less than 3 months after the 
     dwelling units in such project, or in a replacement project, 
     are first made habitable.
       (c) Owner Proposals for Reuse or Resiting of Affordable 
     Units.--Pursuant to section 215 of title II of division K of 
     Public Law 110-161 (121 Stat. 2433), the Secretary of Housing 
     and Urban Development shall, not later than October 1, 2009, 
     promptly review and approve--
       (1) any feasible proposal made by the owner of a covered 
     assisted multifamily housing project submitted to the 
     Secretary that provides for the rehabilitation of such 
     project and the resumption of use of the project-based 
     assistance under the contract for such project; or
       (2) the transfer, subject to the conditions established 
     under section 215(b) of title II of division K of Public Law 
     110-161, of the contract for such covered assisted 
     multifamily housing project, or in the case of a covered 
     assisted multifamily housing project with an interest 
     reduction payments contract, of the remaining budget 
     authority under the contract, to a receiving project or 
     projects.
       (d) Definitions.--For purposes of this section--
       (1) the term ``covered assisted multifamily housing 
     project'' means housing that--
       (A) meets one of the conditions established in section 
     215(c)(2) of title II of division K of Public Law 110-161;
       (B) was damaged or destroyed by Hurricane Katrina or 
     Hurricane Rita of 2005; and
       (C) is located in an area in the States of Alabama, 
     Mississippi, and Louisiana that was the subject of a disaster 
     declaration by the President under title IV of the Robert T. 
     Stafford Disaster Relief and Emergency Assistance Act (42 
     U.S.C. 5121 et seq.) in response to Hurricane Katrina or 
     Hurricane Rita of 2005;
       (2) the term ``designated disaster area'' means any area in 
     the States of Alabama, Mississippi, and Louisiana that was 
     the subject of a disaster declaration by the President under 
     title IV of the Robert T. Stafford Disaster Relief and 
     Emergency Assistance Act (42 U.S.C. 5121 et seq.) in response 
     to Hurricanes Katrina and Rita of 2005;
       (3) the term ``project-based assistance'' has the same 
     meaning as in section 215(c)(3) of title II of division K of 
     Public Law 110-161; and
       (4) the term ``receiving project or projects'' has the same 
     meaning as in section 215(c)(4) of title II of division K of 
     Public Law 110-161.

     SEC. 7. HOUSING DISASTER PLAN.

       Not later than June 1, 2008, the Secretary of Housing and 
     Urban Development shall--
       (1) develop a written disaster response plan for federally-
     assisted properties, including for properties that receive 
     assistance pursuant to--
       (A) section 202 of the Housing Act of 1959 (12 U.S.C. 
     1701q); and
       (B) section 811 of the Cranston-Gonzalez National 
     Affordable Housing Act (42 U.S.C. 8013); and
       (2) submit such plan to the Committee on Banking, Housing, 
     and Urban Affairs of the Senate and the Committee on 
     Financial Services of the House of Representatives.
                                 ______