[Congressional Record Volume 157, Number 53 (Tuesday, April 12, 2011)]
[Senate]
[Pages S2394-S2395]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. PRYOR:
  S. 792. A bill to authorize the waiver of certain debts relating to 
assistance provided to individuals and households since 2005; to the 
Committee on Homeland Security and Governmental Affairs.
  Mr. PRYOR. Mr. President, I want to talk just for a few minutes about 
an incident that is unfolding in Arkansas, and that I am sure is 
unfolding in other States as well.
  Less than 2 weeks ago, a 73-year-old woman and her husband received a 
letter from FEMA, where FEMA demanded that this couple pay back $27,000 
in FEMA assistance they had received 3 years earlier, and that they do 
so within 30 days or face penalties, interest, et cetera. Well, this 
was devastating news for her. These are Social Security recipients. 
They lost everything in a flood.
  But let me back up and tell the full story, and then tell the rest of 
the story. Three years ago, Arkansas had some floods on the White 
River, and the folks in the Mountain View area, some of them, 
experienced very severe flooding. FEMA actually came to this couple's 
house, walked around, and told them on the spot they were eligible to 
receive FEMA assistance for the flooding. The maximum you can receive 
is $30,000. So they filled out the paperwork.
  In fact, FEMA helped them do some of that, like I said, on the spot, 
while FEMA was visiting their home and looking at their property. FEMA 
assured her they would qualify for this assistance. So they filled out 
the paperwork and they went through the process.
  Apparently, at some point, there was even an appeal or some sort of 
clarification. So it went through the proper channels at FEMA. 
Remember, FEMA was there, they took pictures, and the whole deal. They 
verified the damage. So this couple received $27,000 in FEMA 
assistance.
  They put every dime back into their home. This is a couple who 
basically lost almost all their worldly possessions in this flood. I 
talked to her a week or so ago, and she told me they were able to save 
a few items of glassware and a few keepsakes from the family, but 
basically everything was either washed away in the water or so caked 
with mud it was ruined during the flood. The $27,000 helped repair 
their home and make it habitable, but it didn't restore their home 
anywhere close to the condition it was before the flood. This was their 
dream home--their retirement home. They live right there on the White 
River. It is a beautiful part of the State.
  So they got this letter a couple of weeks ago. Now, bear in mind this 
flood happened 3 years ago--the flood happened 3 years ago--and they 
are now required, under the rules and regs and the law that FEMA works 
with, to pay all this money back. As I said before, this is a terrible 
hardship.
  As it turns out, what happened is these folks, although they were 
assured by FEMA they were eligible, they were actually never qualified 
to receive this money. They didn't know that. They had FEMA in their 
living room telling them they were qualified and they should receive 
the money; that they met all the tests and standards and that is what 
this program was for, to help people like them. However, there was one 
technicality, and that was that the county in which they lived had not 
passed an ordinance to go into the FEMA flood insurance program. Here, 
again, FEMA should have known this.
  FEMA apparently went to some of the county meetings where it was 
discussed and voted down. But, nonetheless, FEMA assured these people 
they would be covered under this program.
  The irony of all this is that the couple, when they bought their home 
on the White River, one of the preconditions or requirements they set 
for themselves was they would purchase flood insurance. They had it for 
a number of years. They paid premiums for a number of years. They never 
experienced a flood, but they paid premiums for a number of years.
  Finally, the insurance company that offered the flood insurance got 
out of the business, and so they even went to the extent of going 
through Lloyds of London to get flood insurance. They paid a lot of 
money for a premium, but they, nonetheless, carried that as long as it 
was offered. Finally, it wasn't offered any longer, and the only thing 
left was the FEMA National Flood Insurance Program. But because the 
county had not done what they were supposed to do, this couple, 
therefore, was not eligible to receive the FEMA flood money--again, no 
fault of their own. They had done everything anybody could do. They had 
paid their premiums out of their pockets as long as they could, as long 
as they could find insurance, and as that was canceled over the years, 
the county hadn't come through. But, apparently, FEMA was actually 
there at the county meetings and knew, or should have known, this 
couple wasn't eligible. Yet they gave her this money, and now they want 
it all back with penalties and interest, et cetera.
  So I have filed the Disaster Assistance Recoupment Fairness Act, and 
we actually have it in two forms. We have it as a stand-alone measure, 
and we also have it as an amendment to the bill that is pending on the 
floor right now.
  The important point of this story is that all of the mistakes that 
were made were on FEMA's side of the equation. The couple in Arkansas 
made no mistakes. They followed the rules, went through the process, 
went through the hearings. There is no allegation of fraud or that the 
couple in any way misled anyone. They gave them the documents and did 
everything they were supposed to do. It was textbook. They did 
everything they were supposed to do, but FEMA is now coming back and 
asking for recoupment.
  So our bill will not give a blanket exception, but what it will do is 
give the FEMA Administrator the authority, under circumstances he deems 
fit, to waive the debt that is owed to the United States in cases where 
funds were distributed by a FEMA error, as in this case. Also, it gives 
them the discretion that they do not have under current Federal law.

  I met with Director Fugate on this a week or two ago, and actually we 
had a very constructive meeting. I think probably on a personal level 
he understands this. He feels bad about this. But he believes his hands 
are tied under the statute. I am not 100 percent sure they are but he 
says they are. He tried to be very helpful, very accommodating. I think 
he does want to work with all the parties involved to try to clean this 
up. But he says he does not have the authority.
  That is where this bill comes in. We wish to give the FEMA Director 
the authority to have some discretion on some of these hardship type 
cases, especially where the person who received the benefit did it 
purely by a FEMA error. Again, in their case, they put every dime of 
their recovery back into their home to have it livable. Otherwise they 
probably would have had to abandon their home or sell the property or 
whatever the case may have been.
  That is what we are asking of the Senate, if they would consider this 
at the proper time. I ask my colleagues to take a look at it. My guess 
is, since we have 35 households in our State that are receiving these 
types of letters from FEMA, these demand letters where they are giving 
a notice of debt to folks who have received money, my guess is if we 
have 35 in our State there are hundreds and maybe thousands around the 
country in a similar situation.
  Again, our bill is just for FEMA's mistakes. This is probably an 
example

[[Page S2395]]

of the cleanup from the previous FEMA administration. I think Director 
Fugate had nothing to do with this. It took them 3 years because there 
was a lawsuit in the meantime.
  What this is doing is creating a hardship for folks who had been 
playing by the rules. It gives FEMA the flexibility to do some of the 
cleanup in a way that doesn't harm ordinary citizens here in the United 
States. I ask my colleagues to take a look at it. I would be pleased to 
answer any questions. If anyone has those, they can always contact me 
in my office. What I wish to do is not call it up at this point or 
anything like that but maybe be in the queue and be available at 
sometime in the future.
                                 ______