[House Hearing, 110 Congress] [From the U.S. Government Publishing Office] FEDERAL EMERGENCY MANAGEMENT AGENCY'S RESPONSE TO THE 2008 HURRICANE SEASON AND THE NATIONAL HOUSING STRATEGY ======================================================================= (110-172) HEARING BEFORE THE SUBCOMMITTEE ON ECONOMIC DEVELOPMENT, PUBLIC BUILDINGS, AND EMERGENCY MANAGEMENT OF THE COMMITTEE ON TRANSPORTATION AND INFRASTRUCTURE HOUSE OF REPRESENTATIVES ONE HUNDRED TENTH CONGRESS SECOND SESSION __________ SEPTEMBER 23, 2008 __________ Printed for the use of the Committee on Transportation and Infrastructure ---------- U.S. GOVERNMENT PRINTING OFFICE 45-365 PDF WASHINGTON : 2008 For sale by the Superintendent of Documents, U.S. Government Printing Office Internet: bookstore.gpo.gov Phone: toll free (866) 512-1800; DC area (202) 512-1800 Fax: (202) 512-2104 Mail: Stop IDCC, Washington, DC 20402-0001 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 WAYNE T. GILCHREST, Maryland JERROLD NADLER, New York VERNON J. EHLERS, Michigan CORRINE BROWN, Florida STEVEN C. LaTOURETTE, Ohio BOB FILNER, California FRANK A. LoBIONDO, New Jersey EDDIE BERNICE JOHNSON, Texas JERRY MORAN, Kansas GENE TAYLOR, Mississippi GARY G. MILLER, California ELIJAH E. CUMMINGS, Maryland ROBIN HAYES, North Carolina ELLEN O. TAUSCHER, California HENRY E. BROWN, Jr., South LEONARD L. BOSWELL, Iowa Carolina TIM HOLDEN, Pennsylvania TIMOTHY V. JOHNSON, Illinois BRIAN BAIRD, Washington TODD RUSSELL PLATTS, Pennsylvania RICK LARSEN, Washington SAM GRAVES, Missouri MICHAEL E. CAPUANO, Massachusetts BILL SHUSTER, Pennsylvania TIMOTHY H. BISHOP, New York JOHN BOOZMAN, Arkansas MICHAEL H. MICHAUD, Maine SHELLEY MOORE CAPITO, West BRIAN HIGGINS, New York Virginia RUSS CARNAHAN, Missouri JIM GERLACH, Pennsylvania JOHN T. SALAZAR, Colorado MARIO DIAZ-BALART, Florida GRACE F. NAPOLITANO, California CHARLES W. DENT, Pennsylvania DANIEL LIPINSKI, Illinois TED POE, Texas NICK LAMPSON, Texas DAVID G. REICHERT, Washington ZACHARY T. SPACE, Ohio CONNIE MACK, Florida MAZIE K. HIRONO, Hawaii JOHN R. `RANDY' KUHL, Jr., New BRUCE L. BRALEY, Iowa York JASON ALTMIRE, Pennsylvania LYNN A WESTMORELAND, Georgia TIMOTHY J. WALZ, Minnesota CHARLES W. BOUSTANY, Jr., HEATH SHULER, North Carolina Louisiana MICHAEL A. ACURI, New York JEAN SCHMIDT, Ohio HARRY E. MITCHELL, Arizona CANDICE S. MILLER, Michigan CHRISTOPHER P. CARNEY, Pennsylvania THELMA D. DRAKE, Virginia JOHN J. HALL, New York MARY FALLIN, Oklahoma STEVE KAGEN, Wisconsin VERN BUCHANAN, Florida STEVE COHEN, Tennessee ROBERT E. LATTA, Ohio JERRY McNERNEY, California LAURA A. RICHARDSON, California ALBIO SIRES, New Jersey DONNA F. EDWARDS, Maryland (ii) Subcommittee on Economic Development, Public Buildings, and Emergency Management ELEANOR HOLMES NORTON, District of Columbia, Chairwoman MICHAEL H. MICHAUD, Maine SAM GRAVES, Missouri JASON ALTMIRE, Pennsylvania BILL SHUSTER, Pennsylvania MICHAEL A. ARCURI, New York SHELLEY MOORE CAPITO, West CHRISTOPHER P. CARNEY, Virginia Pennsylvania, Vice Chair CHARLES W. DENT, Pennsylvania TIMOTHY J. WALZ, Minnesota JOHN R. `RANDY' KUHL, Jr., New STEVE COHEN, Tennessee York JAMES L. OBERSTAR, Minnesota JOHN L. MICA, Florida (Ex Officio) (Ex Officio) (iii) CONTENTS Page Summary of Subject Matter........................................ vi TESTIMONY Becker, Joseph, Senior Vice President of Preparedness and Response, American Red Cross................................... 38 Fagnoni, Cynthia, Managing Director of Education, Workforce, and Income Security Issues, Government Accountability Office....... 38 Johnson, Admiral Harvey, Deputy Administrator and Chief Operating Officer, Federal Emergency Management Agency................... 20 Nagin, Hon. C. Ray, Mayor, City of New Orleans, Louisiana........ 4 PREPARED STATEMENT SUBMITTED BY MEMBERS OF CONGRESS Graves, Hon. Sam, of Missouri.................................... 52 Norton, Hon. Eleanor Holmes, of the District of Columbia......... 60 Oberstar, Hon. James L., of Minnesota............................ 62 PREPARED STATEMENTS SUBMITTED BY WITNESSES Becker, Joseph................................................... 64 Fagnoni, Cynthia................................................. 69 Johnson, Admiral Harvey.......................................... 139 Nagin, Hon. C. Ray............................................... 158 [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT] HEARING ON FEMA'S RESPONSE TO THE 2008 HURRICANE SEASON AND THE NATIONAL HOUSING STRATEGY ---------- Tuesday, September 23, 2008 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 2:07 p.m., in Room 2167, Rayburn House Office Building, Hon. Eleanor Holmes Norton [Chair of the Subcommittee] presiding. Ms. Norton. We are pleased to welcome all of you today to our hearing, especially our witnesses, on FEMA's response to the 2008 season and on the National Disaster Housing Strategy. This year's hurricane season has been unusually active and once again has had dramatic impact on America's Gulf Coast region. The President has declared 13 disasters or emergencies under the Stafford Act hurricanes and tropical storms in the 2008 season, however, including Tropical Storms Edouard and Fay, and Hurricanes Bertha, Dolly, Gustav and Ike. More than 2 million people were evacuated in the wake of Hurricanes Ike and Gustav. American people must be assured in the midst of yet another powerful hurricane season that the country is prepared for seasonal and terrorist events alike and that FEMA has developed a coherent housing strategy for addressing the inevitable aftermath of large scale disasters. We can make no final judgment until all the evidence is in, but the Federal, State and local authorities appear to have done a credible job in evacuating citizens away from hurricane danger. At the same time, despite improvements from 3 years ago, a number of problems may remain, such as emerging complaints that New Orleans' poorest residents were transported on buses with no announced destination and warehousing and crowded and substandard conditions. If so, we fear that the next time many residents may choose to remain in place as they did during Hurricane Katrina. I spoke with FEMA Administrator David Paulison as the evacuation was beginning. His assurance concerning complete evacuation materialized, but he also spoke of specific destinations and prepositioned supplies that complaints from Louisiana now call into question. To address the issues of accountability that were on stark display during the Katrina response, Congress passed out Post- Katrina Emergency Reform Act 2006, which described directives that were necessary to prepare for the next disaster. Among the most important was a mandate to FEMA to submit a report to Congress describing the National Disaster Housing Strategy. In response FEMA drafted a housing strategy and requested public comment on July 24th, 2008. In anticipation of this hearing, which was previously postponed at FEMA's request, I appreciate that FEMA extended the comment period on this important policy so that comments from today's hearing could be included on the public record. The Post-Katrina Act requires the FEMA Administrator to ensure that a new National Disaster Housing Strategy provides a comprehensive approach to housing victims of a disaster for the immediate and for the long term as needed, consistent with the Administrator's role as the principal emergency management adviser to the President. In reviewing and analyzing the National Disaster Housing Strategy, today's hearing will help the Subcommittee understand the strategic strengths and weaknesses within the context of the Post-Katrina Management Reform Act. The aftermath of Hurricanes Gustav and Ike also should help us gauge the effectiveness of the Post-Katrina Management Reform Act and of FEMA's first significant test under the act. We especially appreciate testimony we will receive today from Mayor Ray Nagin of New Orleans about the most recent responses after Gustav and Ike came ashore, the evacuation, the ability of FEMA, the city and State to provide the needed assistance and progress in New Orleans since Katrina. It will be important to hear of improvements that the City of New Orleans, the State of Louisiana and FEMA have made in responding to these hurricanes, but equally important is testimony concerning other important elements of preparation and response, including planning and consultation among the authorities that were involved, as well as the remaining challenges that they see. As we focus on the condition of citizens after the storm, this Subcommittee also is particularly concerned about the role and responsibilities of the American Red Cross, a congressionally chartered organization which has major assistance roles to play in recovery from disasters. A recent GAO report found that the Red Cross and other disaster relief charities such as the Salvation Army and the United Way of America are unprepared to meet mass casualty needs in the aftermath of a major disaster. We have called both GAO and the Red Cross to testify today in light of the GAO's finding that a large scale disaster could overwhelm the Red Cross and other charities that have Federal responsibilities for assisting the government and providing assistance to victims of disasters. In the aftermath of the devastation of Katrina, we must look at issues differently and more broadly and take the required action. If the Red Cross is expected to play a role in recovery from major disasters, we must work with FEMA to define the function that the Red Cross and other relief charities realistically can perform to supplement the Federal Government's role. We look forward to hearing from today's distinguished witnesses and thank them in advance for preparing testimony. I am pleased to ask the Ranking Member, Mr. Graves, if he has a statement at this time. Mr. Graves. Thank you, Madam Chair. If it is all right, I would like to yield to Representative Mica, who is Ranking Member of the overall Committee. Ms. Norton. Mr. Mica. Mr. Mica. Well, thank you for conducting this hearing today. I won't be able to stay for the entire hearing, but I use my opening statement to raise a number of issues. As you know, my area has been hit with hurricanes, floods, tornadoes, fires. I think we have had everything but locusts and we are working on a plan to possibly deal with that. So we have had a little bit of experience with FEMA and some of the FEMA witnesses I see here. These will be my questions. In fact I want some written responses from FEMA on a couple of these issues. One of the things we found dating back to our hurricanes is we have multiple FEMA officials coming in, I guess like in Katrina or all the different hurricanes that we had. We had three in my district. We had different officials come in and I think it was well intended, they came in and gave direction to local officials. Those preliminary officials were changed out with other officials who came in and made other decisions and interpretations of rules, regulations and all of the above. Then we had, as time progressed and the agency changed their personnel out, we had other people coming in and giving us other opinions, suggestions, recommendations and edicts, sometimes countermanding the previous two. In some instances we are now on our fourth set of officials, giving the fourth interpretation of whatever opinion we were seeking. So this is something we are going to have to work on to do better. The other thing is multiple audits. Congress created this as a result of Katrina, but--and we don't want fraud, we don't want waste, we don't want abuse, but we have got audits upon audits and agency upon agency involved in this process. Somehow we need to get this straightened out. In fact, I have got auditors down in my district still auditing from other audits. So that is number 2 and I would like a little response on that. Number 3, the debris removal problem related to public versus private land. In many instances you couldn't get to public land unless you went across private land. Somehow we have got to figure out a better way for reimbursement and better definition of who gets reimbursed in what situations, because now we are running around in circles chasing our tails on reimbursement, public versus private land. Travel trailer loans and transfers, that requires some Stafford Act amendments, still a disaster. We will even take them with the formaldehyde. Just what people need in a disaster. I have had six attorneys on the phone during a crises trying to get 150 trailers on an emergency basis while FEMA is paying rent on them down the street in a lot and couldn't--it just makes absolutely still no sense, but that oneis under Congress, so chalk that one up. Finally, the grant approval time frames need expediting, and that I guess is somewhat in our corner, too. Madam Chairwoman, I just wanted to add my two cents to this and hopefully at least on the first three we can get some response from FEMA in writing after this hearing or verbally transmitted to the Committee. Thank you for the hearing, and I yield back. Ms. Norton. Well, thank you, Mr. Mica. Mr. Graves, do you have anything to say at this point? Mr. Graves. Thank you, Madam Chair. I think I will just submit my entire statement for the record. But I would like to asked Admiral Johnson, if you would, please convey to Chief Paulison and all the folks at FEMA how much we appreciate your dedication and hard work. We know this is a work in progress, the post-Katrina reforms. We have got a lot of ground to cover yet before we get there, but I would appreciate you doing that. Madam Chair, I will submit my entire statement for the record so we can move on with the hearing. Ms. Norton. Could I ask Mr. Arcuri if he has any statement. Mr. Arcuri. No questions. Ms. Norton. Thank you very much. I would like to call our first witness. I am very pleased to welcome the Honorable Ray Nagin, the Mayor of New Orleans. The mayor knows we have been trying to get down there. We discovered the first time we tried that because Katrina decided to arrive as Labor Day approached, you couldn't get anyone to go with you, and therefore every anniversary we are plagued with the same issue. And I am delighted to welcome you so we could get your progress report, this time apparently not only on Katrina and what has happened since then, but the fact that you have been subjected to yet other hurricanes since. So we pleased to have your testimony at this time. TESTIMONY OF THE HON. C. RAY NAGIN, MAYOR, CITY OF NEW ORLEANS, LOUISIANA Mr. Nagin. Thank you to Chairwoman Eleanor Holmes Norton, to Ranking Member Sam Graves of the House Transportation and Infrastructure Subcommittee on Economic Development, Public Buildings and Emergency Management and to all distinguished Members of the Committee, panel and guests. I am C. Ray Nagin, Mayor of the City of New Orleans. Our great city is facing the challenge of rebuilding after 2005 Hurricane Katrina, the worst natural and man-made disaster to occur in the United States of America. We also had the challenge of dealing with Hurricane Rita right behind that one. We were threatened and touched by two more devastating hurricanes this season that recently hit the Gulf Coast region. Those were Hurricane Gustav and recently Hurricane Ike. I have submitted my testimony to this Committee. I would like to briefly touch on a couple of different areas. First is to update you on 2008 and what happened this year as relates to FEMA: talk to you a little bit about our updated plans; our city assisted evacuation plan; and talk to you about a need for a national evacuation plan and sheltering proposal. I will touch on FEMA and supplies and some issues that we saw this past season. I will touch on hurricane protection and some of the things we are working on: housing, trailers and a few Stafford Act revisions. Hopefully I will do that in a short period of time. Hurricane Gustav posed a serious threat to New Orleans as it approached the coast of Louisiana. We are fortunate that although parts of our city had damage and our electrical power infrastructure received a temporary crippling blow, the partially restored 100-year flood and levee protection system in the city held and we were spared the widespread destruction that the other areas of our State experienced. America's investment in the levee protection system in New Orleans seems to be paying off. We just need to pick up the pace and finish that great work and get to the 100-year flood protection. My prayers go out to the people of other parts of Louisiana and our neighboring State, Texas, who felt the brunt of two devastating storms, Gustav and Ike. I personally visited Terrebonne Parish and other parishes around our State and we have offered our assistance there. I have also spoken to the leadership in Houston and Galveston and have committed to doing anything that my city can do to help them in their response and recovery. It is my hope and prayer that they will not encounter difficulties that we experienced during the past 3 years in accessing assistance from Federal agencies charged with supporting response and recovery. However, based upon my preliminary conversations with leaders in this area, they are still having some of the same experiences even though things have gotten somewhat better. We appreciate all that Congress has done to support us, and we urge you to continue to work to implement changes that will be valuable to us and all communities preparing for emergencies and rebuilding their homes and lives. Let me briefly touch upon our city assisted plan that we have been practicing for 2-1/2 years. We have a plan that is called our City Assisted Evacuation Plan, a comprehensive plan to evacuate citizens who cannot leave on their own because of financial, medical or other reasons. This plan utilizes city buses to pick up residents from 17 designated pickup locations throughout the city and transfer them to a central location for processing, the Union Passenger Terminal. At the Union Passenger Terminal those residents are then transported by buses contracted by the State of Louisiana, Amtrak trains and airplanes contracted through the Department of Defense to shelters in northern Louisiana. And as the Chairlady mentioned earlier, there were significant problems with some of the shelters in northern Louisiana as far as where they were set up, how they were set up and what types of services were provided. We got many complaints. Fortunately, using this process we evacuated approximately 18,000 of our residents who were our most vulnerable citizens to safety. Our capacity for this process is around 30,000 citizens that can be processed effectively. Combined with those who use their own means of transportation, every resident who heeded our warning was able to leave this time. The New Orleans Police Department did a great job, and their estimates are there were only 5,000 to 10,000 people remaining in the City of New Orleans. That is an evacuation of 97.5 percent of all of our citizens. During Katrina we thought we had done a pretty good job, but we only got out 90 percent of our citizens. So we just about got everybody out of our city. We were part of a much larger evacuation of 1.9 million citizens. As we move forward there are many things that we can improve upon, but we have seen some improvements already. I would like to make a couple of points. First, I would suggest to this Committee that we need a national plan for regional evacuations that use assets such as Amtrak and airplanes for transportation. We found in this latest example with Gustav that that was the most efficient way that we could get people in and out of our city. And we did something that I didn't think was possible: we emptied our city out and repopulated it in about 4 days. And if we had had power we probably could have done it a little bit more quickly on the back-end side. We also suggest to you that we need to have a Federal sheltering plan in place. Really the sheltering problem that we experienced with the State is one that could be solved if there was a Federal plan in place. This can be utilized both pre- event and post-event, because we saw after Gustav and Ike is that there is a need to house people even after a disaster has passed. We think the Federal Government can help to coordinate that. We did notice some challenges this time also with ice and MREs and tarps. We did have an immediate supply, but we think that that needs to be stepped up. There was a shortage of supplies and when Ike came down, Texas was also challenged. Tarps sometimes took 7 days to access. I would encourage this Committee to help us to finish the flood protection system, the 100-year flood protection. The Corps of Engineers is telling us that they won't be finished until 2011. That is 6 years after Katrina. We can no longer afford to play Russian roulette with these storms. We need that 100-year flood protection. On the housing front we still have many of our citizens who are in travel trailers. And Congressman Mica, if you want a few travel trailers we might be able to accommodate you. We have more than our fair share in our great city. And if you like formaldehyde we have plenty of those, too. We are working to get people into their homes. Part of the problem that we are having is with the Road Home Program, which handles the grants that citizens need to rebuild their lives. Only 69 percent of those applicants have received awards from the State. So many people are kind of stuck in these shelters, in these travel trailers. So we are hoping that we can move that expeditiously, those grants, so people can get out of those shelters. As far as FEMA and a comprehensive housing policy, we have not seen that yet. We are hoping that we can get to a better place other than just travel travelers, but we haven't seen that yet. And we are concerned because the housing assistance program that FEMA does have is scheduled to expire March 1st. We still have people waiting on Road Home checks and still in trailers. So we hope that that program can be expedited. Another issue is with the Stafford Act, and I am closing now. The Stafford Act has been modified somewhat, but we think there are still some significant areas for change for major catastrophes. FEMA seems to be able to handle a hurricane or minor flooding, but major catastrophes still cause problems. We think that a significant area to look at is having a catastrophic disaster category where there will be special rules associated with that, whether it be advances for municipalities that have been shut down or other things. We also think that there needs to be a third party dispute resolution process put in place. If you have a problem with FEMA right now on anything dealing with restoring a public facility, there is nowhere for you to go outside of the FEMA system. So a formal, public dispute resolution process would be great going forward. Madam Chair, I think I am going to pass on the rest of this because it is in my testimony. I want to thank this Committee once again for helping us throughout this Katrina experience and the 2008 hurricane season. New Orleans and our region are critically important to this Country and we are significant in terms of our contributions to the Country's energy supply, international trade, fishery industry and culture. But unfortunately hurricanes as a force of nature will continue and they are affecting many States, from Louisiana, Texas, Mississippi, Florida, et cetera. We must resolve to work collaboratively to make sure that we have a response that is appropriate for these type of disasters. Thank you. Ms. Norton. Thank you very much, Mayor Nagin. I want to first ask you how you would characterize the status of recovery, leaving aside for a moment the visits of Ike and Gustav, how would you characterize the status of recovery in New Orleans for years later; for example, population return. Mr. Nagin. Yes. Ms. Norton. Return to schools, and businesses reopen and help from FEMA, et cetera, any way you would like. Mr. Nagin. We are still a tale of two cities. We have about 72 to 75 percent of our population back in the City of New Orleans. There are many people still waiting to get back into the city, but we have challenges still with affordable housing. We still have four of our major housing developments that are going through the HOPE VI transition but haven't broken ground yet. Our school system is back up and operational; we are building new schools. We have about the same percentage of our students who are back, but the public education system in New Orleans is transitioning into a model of not only elected officials running the school district, but we have charter schools. You name it, we have it in the City of New Orleans. The jury it still out on that. As far as businesses are concerned, our hospitality industry is doing quite well. Major businesses, about 90 something percent of them came back after Hurricane Katrina and they are doing okay. Our health care sector is still fairly stressed. We are hopeful that a new VA hospital will be built in our city and it looks like that is going to happen. But if you go into areas like the Lower Ninth Ward, which has gotten a lot of profile from the press, you still will see devastation. And there are lots of slabs from demolished homes in that area and throughout the city. We are still working back and forth with FEMA on whether the cost of removing those slabs will be a cost that is eligible for reimbursement. So we are a tale of two cities. Ms. Norton. That sounds like there is progress. Mr. Nagin. There is progress. Ms. Norton. And New Orleans is rising again. Perhaps I should--because I know he can't always stay--this hearing is of such importance that the Full Committee Chair, we have already had the Ranking Member of the Full Committee Mr. Mica come, the Full Committee Chair is here as well, Mr. Oberstar. Mr. Nagin. Good to see you, sir. Mr. Oberstar. Thank you, Madam Chair for the hearing. Mayor Nagin, we welcome you back to the Committee room, it is always good to see you. Mr. Nagin. Good to see you. Mr. Oberstar. We didn't usually see you in a tie and shirt. We see you in some state of distress with your shirt sleeves rolled up. Mr. Nagin. Yes. Mr. Oberstar. Or short-sleeved shirts and a worried look on your face. Mr. Nagin. Yes, yes. Mr. Oberstar. I would just repeat what I said at the first hearing 3 years ago. New Orleans taught America how to cook, how to eat, how to live, how to preserve culture. It was the Battle of New Orleans that united America, made us realize we were a nation, not just a collection. And we owe it to New Orleans to rebuild this city, we still owe it, and that job is not by any means done. Mr. Nagin. Yes. Mr. Oberstar. Ms. Norton has hosted 12 hearings on post- Katrina issues and FEMA. She has been relentless in pursuit of the need for the Federal Government to do a better job in responding, supporting our citizens and responding to natural disasters. Those are calamities not of the city's doing, not of the State or the Nation's doing, they happen. While terrorist acts can be a long time in the plotting and we never know when they are going to come, we know every year there is going to be a hurricane. We know in the north there is going to be a snowstorm. We know there are going to be droughts in the West and floods in other parts of the Country, and we need to be prepared for those. So preparedness. There was an Office of Emergency Preparedness at one time, it was an Office of Civil Defense in its origins. There was a time in 1987 when the then Reagan administration proposed to effectively eliminate the Federal role in disaster response. It was a Subcommittee on Investigations and Oversight of this Full Committee, which I Chaired at the time, which mobilized the Nation. We held hearings bringing civil defense authorities from all over the Country. And out of those hearings we crafted the bill that created what we know today as FEMA. Now a little historical footnote, I gave that bill in draft form to the Republican Member of Congress from Pennsylvania who first brought the issue to our attention. And my Ranking Member at the time was Bill Clinger, a Republican of Pennsylvania. I told this Member, I want you to introduce this bill. He said, but I am in the minority. I said yeah, but you had the courage to bring that issue to our attention. We have crafted the bill and you ought to introduce it, besides the Republican administration needs to you to lead the effort. We got the bill enacted. His name? Tom Ridge. When he became Secretary of Homeland Security he came up to see me. He said you started me on this course. Well, that journey is not finished and FEMA does not belong in Homeland Security, it belongs in the independent Office of the President or in a Cabinet level or sub-Cabinet level, an independent structure with a liaison, a linkage to Homeland Security, but not messed up in the Interior. What happened with FEMA when Homeland Security was created was exactly what I predicted would happen at the time the Homeland Security Department was created. That money would be siphoned off and personnel would be drained away from the agency. And in the first 6 months of Homeland Security 250 of the top personnel of FEMA were sent elsewhere in the Department and $500 million of the budget was siphoned off elsewhere. And when the Katrina disaster struck they didn't have the key personnel in place to help you, to help the State and to help other States, Mississippi and Alabama, and east Texas, to respond. Now, we are going to take the lessons learned. We have already passed the bill last year to reform a good deal of FEMA. I would hope that, as we affectionately call them, the other body will move that legislation. There has been some action over there, and quite possibly Madam Chair will be able to conclude the action on the bill before the end of this session. It is still up in the air. It isn't going to address all of the needs, but it will address a good many of them. But we are going to restart next year. We will need your contribution again, as you have done so willingly many times, and reshape top to bottom. We need a top to bottom review of FEMA and restructure it and recreate it. There already have been 13 hurricane events in this season. Mr. Nagin. Yes. Mr. Oberstar. If you look at a chart going back into the 1980s, the cost of natural disasters just escalates extraordinarily, and the cost to the private insurance sector and to the public sector, both Federal and State and local. That is one thing we know is going to continue to happen with global climate change. So with what we have done in the Water Resources Development Act to rebuild the wetlands in Louisiana, to close out the Mississippi River Gulf outlet---- Mr. Nagin. Yes. Mr. Oberstar. --that caused the disaster that over topped St. Bernard Parish that nearly wiped out the Islenos culture, that should never have happened and didn't happen when that wetland between Lake Borgne and St. Bernard was intact. Mr. Nagin. Yes. Mr. Oberstar. But once the Mr. Go was developed, the salt water came in, the intrusion killed the wetland, the marsh grasses landed on top of the houses. I have never seen a situation where whole homes were lifted up, floated away with their concrete pad intact and went as much as three blocks. Mr. Nagin. Yes. Mr. Oberstar. One home I saw, Madam Chair, stopped only when it bumped into a house that didn't move. And after 6 months the homeowner of the intact home sued the other guy for collision damage. I said, why did you do that? He said, what else are we going to do? The Corps isn't helping us out, FEMA isn't helping us out, no one can help us out. So we just thought for a little excitement we would have a lawsuit. That shows a lot of resiliency in the people, but it shows a failure of the public sector. You have experienced a great deal of dislocation and disruption. You have led the effort to rebuild your community. You have been a stalwart and we need to reward that effort with a much better Federal partnership and response. And under the leadership of Ms. Norton and Mr. Graves on the Republican side and a bipartisan effort, we are going to do that. I pledge that to you. Mr. Nagin. Thank you, sir. Ms. Norton. Mr. Graves, do you have any questions at this time? Mr. Graves. Thank you, Madam Chair. Thank you, Mayor, for coming in. We appreciate it very much. You were talking about some of your city recovering and some things. Population wise, how much population have you lost? Mr. Nagin. About 75 percent is back, and around 100,000 people that still have not been able to come back. Mr. Graves. Do you think they are just never going to come back or they still don't have their homes? Mr. Nagin. I think a percentage have settled in where they are, but there is a significant percentage of those individuals that still would like to move back to New Orleans, but because of affordable housing issues and Road Home issues with their grants, many of our citizens struggled with their insurance companies, the whole wind versus flood debate, and there are some financial gaps, but we are trying to help them out as best we can. Mr. Graves. And how about in your local government changes, what changes has your city government made to get ready for hurricanes in the future or changes you made as a result of what happened in Hurricane Katrina? Mr. Nagin. Right after Katrina, while we were starting the rebuilding process, we started immediately planning for the next major hurricane. We have evaluated just about every one of our processes. We went up to Emmitsburg, Maryland, I think it is, which is a FEMA training facility. I took my whole team through that. We practiced, had exercises throughout the year. We have adjusted our evacuation plans and re-entry plans, and we have put more resources in our disaster management group. And we performed pretty well during Gustav. Mr. Graves. I congratulate you on being able to remove-- what did you say, 96 percent? Mr. Nagin. No, it was about 97 percent of our citizens in 4 days, emptied and repopulated the city in 4 days. Mr. Graves. Big job. Mr. Nagin. I don't know of any other city that can do that. Mr. Graves. Thanks, Madam Chair. Mr. Nagin. Thank you. Ms. Norton. Mr. Arcuri? Mr. Arcuri. Thank you, Madam Chair. Mayor, first of all, thank you very much for being here. I just want to thank you for what you did. You symbolized for the rest of the country the resiliency and fight in New Orleans. Thank you for what you have done. Mr. Nagin. Thank you. Mr. Arcuri. Mayor, I am from upstate New York, and we have had a few 50-year floods, nothing to the degree that you have had, but we have had some serious damage. One of the things that we talk about is the importance of FEMA in doing some of the--the actions beforehand, buying up some of the homes in the flood plains in the areas. You are sort of in a unique place. You have seen what happens on the front end and then you have seen what happened this year, granted not to the same degree of Katrina, but when the right things are done the prevention that can take place. Can you share with us just some of your thoughts in terms of, you know, on how important it is to spend money on the front end so you can save money on the back end? Mr. Nagin. Well, there are a couple aspects that I can refer you to. First is our hurricane protection system. I know Congress worked very hard, but the billions of dollars you put forward we didn't have any catastrophes as it relates to that. We had to confiscate some land or help the Corps to confiscate some land from our citizens, but that allowed the Corps to build the protection systems that we desperately needed. The other thing I can point you to is that FEMA was able this time to preposition some assets, some MREs, some water, some ice. Even though we ran short of supplies, that saved us time and effort on the back end, if you will, once the storm hit. So those are two things that I think we could continue to work through. And I will tell you another thing that would help a lot. FEMA is starting to prioritize the types of repairs that you can do after an event, whether they be police stations, fire stations or what have you. I think they have taken some of the lessons they learned in New Orleans and are applying those to Texas and some other places. The reason why I bring that up is because it took us such a long time to get our criminal justice system back up and operational; we experienced damage, and we experienced crime that cost us and the Federal Government a lot of money. By prioritizing those efforts, I think that can be avoided in other places. Mr. Arcuri. After Katrina did FEMA buy some of the area or some of the land where houses were in dangerous areas or dangerous zones? Mr. Nagin. The State did through the Road Home Program. So for example, if a citizen was in a low lying area that is repeatedly flooded, you can opt to either rebuild your home higher or safer or you could sell that property. And there were a significant number of people who took that option. Mr. Arcuri. Was it successful? Mr. Nagin. We are still in the middle of it, but based upon the properties, a map of the properties, it looks as though some really low lying areas, just about everybody sold their properties, which was smart because the marketplace made an intelligent decision. We kind of gave them the guidance, here is the levee protection system, here are the risks, here is what you face going forward, and people made intelligent decisions. Mr. Arcuri. I guess the big question is, is it worth it financially, do you save money on the front end by buying up those parcels as opposed to, you know, the back end after the damage already occurs? Mr. Nagin. Well, normally I would have totally agreed with you. I think that still makes some sense. But these storms are different now. For the first time this year I have noticed with, let's take Gustav and Ike, they came in so fast that normally storms run at about 5 to 8 miles an hour when they come in. These were coming in at 12 to 15 miles an hour. They had so much momentum that they went so deep inland. I mean, Ike had flooding that it caused in Ohio. So, I don't know if you are going to be able to buy up enough property with the type of storms that we are seeing. The only thing I can see us doing is work on global warming and let's get some coastal restoration. Then I think we are going to be okay. Mr. Arcuri. Thank you very much, Mayor, appreciate all of your work. Mr. Nagin. Thank you. Ms. Norton. Thank you, Mr. Arcuri. Mayor, I want to ask you about something in your plan and also some reports we have heard. I mean in your testimony you speak of some issues involving information between the city and the State. I ask this because I spoke with Mr. Paulison as the evacuation was occurring, I think it was Labor Day, I know everybody was home. I managed to get him. He gave me a very good and full report and assured me there would be evacuation, and there was a full evacuation. He told me as well that there were destinations. He gave me examples of destinations, a number of destinations all the way into Alabama. And he said that there were not only predesignated shelters, but there were predesignated supplies. First, I have to ask you about the predesignated shelters, because if there were predesignated shelters why did so many of them--the figure we received was as many as a thousand of the poorest people who were apparently transported by buses and apparently didn't know where they were going--I don't know why not tell them, they are going to come home--found themselves in something, shades of Katrina, in some huge warehouse, and there were no bathing facilities, they were crowded. It was apparently a very serious substandard state. Mr. Nagin. Yes. Ms. Norton. They may have been there for a week. Did you know ahead of time that people would be going there? And do you have any idea how that happened? That is the only one we heard of. Mr. Nagin. I will just give you what I know. The city's responsibility is to get our citizens from their places, if they need it, to a central location, utilizing our transportation medium, and then get them to the point where we can hand them off to the State for transportation to the shelters, whether they be in State or out of State. That is our responsibility. FEMA---- Ms. Norton. Are you saying that you can't take them even to a shelter in State if it is not in your jurisdiction? Mr. Nagin. No. The State of Louisiana is responsible for that. Ms. Norton. So they might have to get off something and get on something else or they just pick up the responsibility? Mr. Nagin. Only one time. We get them to the Union Passenger Terminal, we register them, and then they get on either a bus, plane or train and they go somewhere that is basically out of our control. Now, it is my understanding that FEMA was coordinating out of State shelters with the State and those were pretty well determined. I think we had Alabama and Memphis. Tennessee and Texas were taken out of play because of the direction of the storm. But those were pretty well established and we knew about them. The problem was in State. There were buses that we would put our citizens on, but the State contractor didn't know where they were going because the State locations had not been fully articulated. Ms. Norton. But it was not on a bus to nowhere? Mr. Nagin. Some were. And we had to direct some--because we were getting a backlog at the Union Passenger Terminal. We directed the buses just to start moving north. And we would communicate with them the exact location, which ended up working out. But it seems as though the State---- Ms. Norton. Does that mean that the State was late in finding sheltering space and hadn't preplanned for where people might go after in case they left New Orleans? Mr. Nagin. It appeared as though everything that should have been prepositioned as it relates to shelters in the State was not completed until a very late time. Ms. Norton. You suggest a need for planning in the future been the State. Mr. Nagin. Yes, either the State needs to let us know much earlier or FEMA can take responsibility for in State and out of State sheltering. I don't know if that is something they would want to do, but there are three different levels of government that are dealing with these disasters and it just needs to be a little better coordinated on the sheltering side. That is if we have any trouble going forward. I worry about that aspect of what we did. Ms. Norton. Well, you mention that there were shortage of some supplies like ice and so forth. Mr. Nagin. Yes, that happened from the standpoint of after a few days, I think we were able to set up what they call PODs, which are basically distribution centers for people to pick up ice, water and MRE's. We were only able to man three PODs throughout the entire city, three locations. And then we ran out of supplies after 2 or 3 days. Ms. Norton. Who was providing those supplies? Mr. Nagin. That was through the Corps and through FEMA. Ms. Norton. We will have to find out what happened there. We heard also of food stamps that had to be activated. Now I understand that there were--with all the overwhelming catastrophe of Katrina, you would expect somebody to take advantage of it. So there were some people who got food stamps who never should have gotten it. But there were complaints from some that you have food stamps and then you can't use it until it is activated. I can't even tell how you get it activated or how you know when it has been activated. I mean does it buzz? Mr. Nagin. There was a program, a benefit that people who normally do not qualify for food stamps can come in and get a card and, based upon your income level and how many people in your household, you can get up to $500 worth of value on that card. The problem was they forced everybody to come in and do a face-to-face process, which caused one problem. And then secondarily the system was overwhelmed. Their technology was overwhelmed where it took 72 hours before the card was activated. In some cases it was never activated. So it was kind of a mess. Ms. Norton. So this was after they had done the face-to- face? Mr. Nagin. This was after. It was a mess and I think somebody resigned at the State as a result of it. Ms. Norton. In the State or at FEMA? Mr. Nagin. State. Ms. Norton. I see. So that activation of food stamps---- Mr. Nagin. Was a State responsibility. Ms. Norton. Was a State responsibility, not a FEMA responsibility? Mr. Nagin. Not that I am aware. I am sure the Admiral will come up and correct me, but I think it was a State responsibility. Ms. Norton. I can't but help and ask you about the levees. We were all nervous about the levees, and please don't do this to New Orleans again. What does that tell us? Does it tell us that the storm wasn't so strong as to test the levees or does it tell us that the levees are truly stronger because of the work that you have done? Mr. Nagin. I think it tells us that America's investment is starting to pay off, but we are just not finished. It tells us that we can handle a Category 3 storm that dissipated once it got to shore. Ms. Norton. Katrina was a Category? Mr. Nagin. Was at least a 3. Ms. Norton. So it has already done its damage there, and yet you can handle a 3 now? Mr. Nagin. Yeah, we think we can handle a 3 coming in that direction. Katrina came in a different direction. So we didn't test the system exactly. Ms. Norton. It wasn't the same levees that were being tested, was it? Mr. Nagin. Yeah, but it was much more comprehensive. Gustav came more from south to north. Katrina came from the east going west over Lake Borgne and hit the Lower Ninth Ward in New Orleans east. Much, much stronger. The levees held. Now what was scary to some people is that the water levels got to the maximum levels that that particular levee could handle. Ms. Norton. Yes, we saw water going over. Mr. Nagin. Yeah, but it was wind. And I think we are going to have that even in the best of scenarios; we may have some over topping. As long as the levees do not fail and start crumbling, I think we will be okay. We have a pumping capacity once the water gets in the city and as long as those pumps are not under water we should be okay. Ms. Norton. Your folks have shown extraordinary courage coming back and building and coming back to maintain themselves. Can they get insurance on their homes? Mr. Nagin. They can get it, but it is very expensive. One of the things that most of the coastal communities are experiencing is increased cost of insurance. At the time when the insurance companies are recording record profits, it is really kind of puzzling to me. Ms. Norton. Really at some point we are going to have to do a hearing to see whether or not it is possible. I mean people coming back, I know some of them can't afford insurance. They are taking their chances because of a love of New Orleans. Mr. Nagin. Yes. Ms. Norton. We have to come to grips whether or not it is possible to rebuild whole areas if insurance is unavailable. Now there is flood insurance, there are some kinds of insurance that the Congress makes available. Mr. Nagin. Now, Madam Chairperson, if I could get this Committee to understand one thing, even if you can get insurance in Louisiana your deductible is the problem--the rules were changed right after Katrina. There are no longer $500--and I don't know if anybody else is experiencing this, whether they are experiencing it in Florida--there are no longer $500 to $1,000 deductibles. They are a percentage of the value of your home. My personal deductible at my home is probably $6,000. And I hear people tell me this story; it is like 3 percent or 2 percent of the value of your home. So even if you have insurance, unless you have a major catastrophe, normally you are self-insured. Ms. Norton. You are self-insured. Are people building, are people rebuilding? What does that say about a business, are they self-insured, too? Mr. Nagin. No, businesses are handled a little differently. They have a higher deductible, but a business can only handle that kind of situation. Ms. Norton. Mr. Graves, do you have a question for him? I have a series of questions. I want to make sure anybody else that has questions also get a chance that come from your own answers. I need to ask you, I remember you came to my office, you were very concerned that people were meeting a date where they had to get out of shelters and the city didn't have the housing to accommodate these people. We have had a hearing because many of these needed continuing case management. As a result of that hearing, we asked FEMA to extend the case management for these residents. Many of them from Louisiana was extended until March 2009. And we are prepared to asked again. We realize we are not dealing with people who have simply been displaced. We are often dealing with the elderly, with disabled people, and people who need very special help. Are those people still in trailers and are they formaldehyde trailers? Need I say formaldehyde infected trailers? Mr. Nagin. Yes. There are still a significant number of our citizens who are still in---- Ms. Norton. What percentage of those displaced would you imagine or believe are still in trailers in particular? Mr. Nagin. There are still about 3,000 trailers in the City of New Orleans. I think the last number I saw there was about 6,000 trailers statewide. That is units. So there are two to three people living in each trailer. So the math is pretty easy. Those benefits are scheduled to expire, not only those but anyone in an apartment complex or in a hotel, in March of 2009. We still do not have the Road Home checks, as I mentioned in my testimony. There is still about 30 percent of our citizens who still have not received those benefits. So they are forced to live in a trailer or in temporary housing. Until the checks are processed and the trailers are removed, I would argue that the benefits should be extended at least until the end of 2009. Ms. Norton. When you talk about people having not received their Road Home checks, you really raise this question that we need to understand, and that is that Congress has appropriated a great deal more money. Mr. Nagin. Yes. Ms. Norton. Than has been distributed. Now people are always afraid when you have that much money that has been authorized, and they want to make sure we are not in a situation where we have an unmanageable distribution and problems occur. What is your view of the pace of distribution of authorized funds to the city? Are you able to get the funds that are authorized? Mr. Nagin. It is a painfully slow process. Whether it is Road Home checks or whether it is FEMA reimbursements, you name it, whether it is hazard--and we haven't started to tackle hazard mitigation dollars in a real way. There is still $1.2 billion worth of hazard mitigation money that the State is trying to figure out how to spend. The regulations are complex and the money flows slowly. Just to give you an example, the difference between the amount of money we think we need to fix all the public facilities that were damaged during Katrina_that we feel as though we need_and what has been appropriated or authorized by the FEMA PW process is about 40 percent. And the number goes up but we still are nowhere there. Ms. Norton. Forty percent. Mr. Nagin. Forty percent of the value that we think we need to repair a lot of these public facilities. Ms. Norton. So what kinds of public facilities are not up, for example? Mr. Nagin. You name it, fire stations, police stations, community centers, playgrounds, parks. We got our criminal justice system_the main complex up, but we still have some work to do. So we are actually managing right now about 400 different projects that are at some various stages in the process of being reimbursed, and it is just complex. Ms. Norton. I want you to know, Mr. Mayor, that this Subcommittee is experiencing some frustration because this Subcommittee processed through a bill which we proudly named the Katrina and Rita Recovery Facilitation Act of 2008. It was drawn after consultation with you, the then Governor. We had hearings here where Members, the entire delegation came to testify. The whole point was to try to find quick fixes for New Orleans and Mississippi in particular. These quick fixes would apply under the Stafford Act only to the Katrina ravaged areas. This became while we processed the bill--it was a leadership bill, it really began at the top. So our Subcommittee, we put it through, it went through as one of the first bills. Then we put it to the repository of all bills that then go to sleep. Now this one didn't go to sleep--and perhaps you know more than we know. This bill contains some of what we know the State needs. Perhaps the cardinal feature was the waiver of the Stateshare of much of the funding, 100 percent funding. So I have to ask you without that bill, are you managing to come up with a State share? Mr. Nagin. The State has appropriated the money. They pledged, the Governor has pledged to present the match. But what we are hearing from the Corps of Engineers, if you are talking levee protection is that they need an appropriation at the Federal level to award the contracts because they are going to get a reimbursement from the State. And, because they don't have that money appropriated they cannot move forward with some of the contracts to finish up the 100-year flood protection. So like I said, this is very complex and frustrating at times because a lot of the congressional intent--we come to you, you do great work and then there is some bureaucratic rule that slows things down or---- Ms. Norton. The bureaucratic rule is called the Senate of the United States in this case. Now I know that my good friend and your Senator has been trying her best to get this bill out and she has more to gain than any other. Mr. Nagin. Yes. Ms. Norton. But she deals with a body that has trouble passing bills because of its rules. Someone mentioned alternative dispute resolution. There is an alternative dispute resolution section there. There are all kinds of things that nobody else will be able to do under the Stafford Act, but that you could do because of this constant issue that comes before us about a hold up. And again I know that the bill has been reported out. I have before me the report. I cannot believe that the Senate will leave without getting that bill done. And I have every hope that they will. Sometimes in the very last days people see the kinds of things that they simply can't leave town without doing. That is why we are working now on the collapse of Wall Street. I want to just ask you a couple more questions that we need to understand. The trailers bothered everybody. Not only do we have hearings in my other Committee, the Oversight Committee-- which is basically an investigatory Committee--had hearings showing its shameful way in which the notion that there was even formaldehyde in the trailers finally got exposed. Now, you have for interim housing something that would be very important for the Nation if it works, Katrina cottages that were apparently initiated 2 years ago. I don't know how much of the $450 million has come down to allow the Katrina cottages. Tell us about the Katrina cottages, what is the difference between them and other housing and the temporary housing and how many cottages or whether those cottages are ongoing or are a viable way to put people in Louisiana at this time. Mr. Nagin. Well, the Katrina cottage is a concept that I think the State of Louisiana and Mississippi both embraced. It is my understanding that Mississippi was able to move a little quicker in setting up their program than Louisiana. Ms. Norton. So what is the difference? Tell us what a Katrina cottage is and what is the difference between it and other temporary housing? Mr. Nagin. It is a small modular home, if you will, 600 to 800 square feet, I think. It is something that can really be constructed very quickly and put up in a manner that would allow citizens to have a dwelling place other than a FEMA trailer. The State of Louisiana has struggled with that program. I don't think we have any in the city of New Orleans that I am aware of. Ms. Norton. So it has to come through the State, the funds have to come through the State? So there is not a single Katrina cottage in New Orleans? Mr. Nagin. Not that I am aware of, Madam Chair. Ms. Norton. I know you would know. Mr. Nagin. A big part of the disaster that has been frustrating to me, and I understand why it is done, but the Federal flow of funds always goes through our State first. Then not only am I fighting with one bureaucracy, but I have to fight through two before I even get to my own bureaucracy, so that has been really tough to deal with. Ms. Norton. Finally, let me ask you, because our concern is also about the very poorest people for whom permanent housing would be hardest to come by, and there was great controversy because some of the public housing was torn down. Mr. Nagin. Yes. Ms. Norton. And I would like to know what alternative there is for people who might have found homes in public housing. Is there comparable housing? What about FEMA and HUD's role in rehabbing public housing? Mr. Nagin. As far as public housing is concerned we worked really hard with HUD and with Congress to make sure that there was a firm commitment that every one of the public housing residents that were there pre-Katrina, which was 5,200 units, there would be permanent support of vouchers that would accommodate them until their homes were rebuilt. We have four major housing units. Ms. Norton. Until the public housing was rebuilt? Mr. Nagin. Until the public housing is rebuilt. So they are supposed to have--and we have not gotten any contrary information that suggests anything otherwise--if they are in New Orleans they have supportive housing; and if they are in another location they have supportive housing. And that should stay in effect until the new units are constructed. Ms. Norton. Are there going to be new units? I know the difficulties in public housing. We have had the same difficulties here, just as we had difficulties in our school. And I commend you on your charter schools. I think charter schools are the best thing since sliced bread because they are small schools, they are alternatives, they will keep people in the city, they do as well as the public schools usually. And because they are small, they are publicly funded, they are accountable in the same way, in order to keep from building public housing, as all cities,. New Orleans was like every other city. They built the public housing where they could, large numbers of units in one place. You put a lot of poor people with no upward mobility, no way to get out, no jobs, and then you are surprised that there are problems there. Is there going to be public housing in New Orleans and how will you construct it? I mean, you have land now that was not available before. Do you believe you will be able to replace those units or come anywhere close to it with public housing units of some kind, perhaps spread and not bunched together? Mr. Nagin. We are working with HUD, as we speak, to dedensify a lot of the public housing units and not have a concentration of poverty in any one particular section of the city. We are going forward with some Hope 6-like developments, which are mixed income. We have a plan in place to restore most but not all of the public housing units that we had pre- Katrina. But anyone who does not go into a unit is guaranteed to have a voucher. They will be able to go into the community and be involved in a mixed-income neighborhood in that respect also. That seems to be moving forward. Our challenge, though, is that HUD is making noises that the financial crisis that we are in is starting to strain those four developments. And they have asked us to help lobby for a couple of things. One is the 901 fundability issue where they have some vouchers that are not being utilized and they want to use those to fill some gaps in this construction. We have been talking to people about that. Ms. Norton. Before you leave, we are going to have the Red Cross before us as well as GAO. And you know that the Red Cross in many ways has served the country heroically, very often with volunteers. Of course, they do have some staff. How would you evaluate the role of the Red Cross in this last hurricane, for example? Mr. Nagin. Well, the Red Cross has been there all the time in all the disasters. If I had any complaints with the Red Cross, it is that during the disaster they tend to go up north to kind of get out of harm's way, and I understand that. So getting back into the disaster area was a little bit of a challenge during Katrina. But for the most part I think they are a valuable organization. I think they are probably stretched to the limit right now and probably need some more support. And I think they come into a community right after a disaster and do really good work of feeding our citizens. Ms. Norton. Well, I want to thank you, Mayor Nagin. We have kept you longer than we might have had we had an opportunity to speak with you about the progress in Louisiana since then. And now we not only had to ask you about that, but we had to hear about these latest visitors. And it has been very valuable testimony, very helpful to us. And I thank you very much for coming today. Mr. Nagin. I thank this Committee and I thank you, Chairlady Norton, for everything that you have done. New Orleans wouldn't be back to the level it is, we are at about 75 percent there, if it wasn't for this Committee and Members of Congress, so we are indebted to you all. Thank you. Ms. Norton. Thank you, sir. Could I ask Admiral Harvey Johnson, the Deputy Administrator and Chief Operating Officer of FEMA, if he would come forward and offer his testimony? Thank you Admiral Johnson, you may proceed. TESTIMONY OF ADMIRAL HARVEY JOHNSON, DEPUTY ADMINISTRATOR AND CHIEF OPERATING OFFICER, FEDERAL EMERGENCY MANAGEMENT AGENCY Admiral Johnson. Good afternoon, Chairwoman Norton and Members of the Committee. I am pleased to be here today to discuss the National Disaster Housing Strategy and our response thus far to 2008 hurricane season. Fortuitously, as we are now in the recovery phase of Hurricanes Gustav and Ike, these two topics have become intertwined as we also were able to employ many elements of the strategy in the ongoing response efforts. However, before I go any further I do want to thank you, Madam Chairwoman, for allowing us to delay the hearing that was scheduled for September 11. It was sort of to our benefit, and I hope to yours, to delay and combine the hearings today. I do believe that the draft National Disaster Housing Strategy is likely one of the most significant documents prepared by FEMA and released under the umbrella of the national response framework. The strategy describes how the Nation currently provides housing to those affected by disaster, and, more importantly, it charts a new direction for our disaster housing efforts must focus if we as a Nation are to be better able to understand and meet the emergent needs of disaster housing needs of victims and communities. The strategy captures lessons learned from Hurricane Katrina and subsequent disasters, embraces the larger issues of disaster victims beyond simply providing a structure, seeks innovative and creative housing options, elevates the issues of safety and security and access to those with disabilities, emphasizes again and again the value of planning, differentiates a catastrophe above all other disasters, and suggests that these issues merit full attention before and between disasters, not merely just in time short-term sporadic attention after a specific disaster. A national strategy is the first step in developing integrated disaster housing plans across the Nation that all support a common vision and goal. This strategy would be a common basis to synchronize disaster housing plans at the State, local and Federal level. Addressing the challenge of disaster housing should not be driven from the Federal level; rather, we must provide the leadership, set the pace, and actively encourage and gain commitment from individuals, communities, States, Federal partners, nongovernment organizations and the private sector. This strategy also embraces the need for immediate action by framing FEMA's establishment of a National Disaster Housing Task Force, charts specifically to aggressively implement the strategy. In fact, since the release of the strategy for public comment, FEMA has now activated the National Disaster Housing Task Force. And though it is still in the embryonic stage of development it is deployed to Austin, Texas and to Baton Rouge, Louisiana, to work with the State-led housing task forces in responding to Gustav and to Ike. I would also like to comment on the combined activities of the Federal, State and local efforts in response to these two hurricanes. These two storms both projected at one time that a life span Category 3 or stronger storms at landfall both had the capacity to impose catastrophic damage simultaneously to multiple States along the Gulf Coast. Each posed a worst- nightmare scenario: one, a direct hit on New Orleans, and the other to communities in the core of our Nation's energy sector in and around the complexes of Houston, Port Arthur, and Lake Charles. And each made landfall only 12 days apart. These storms served as proctor to the most severe tests of the National, State and local individual preparedness since Hurricanes Katrina and Rita. And where the 2005 storms exposed the Nation to a lack of preparedness, to indecision, and an absence of coordination across all levels of government and among individuals, the test of Hurricanes Gustav and Ike presented just the opposite. The response and, thus far, the recovery from these two 2008 storms provides evidence of extensive levels of preparedness, decisiveness by elected and appointed officials at every level of government, as well as by citizens who elected to evacuate in record numbers at a level of engaged partnership among States with the Federal Government to put the right capability in the right place at the right time to save lives, to minimize damage, and to establish a much smoother road to recovery. When our combined efforts were not perfect, I believe that combined efforts at the Federal, State, and local levels made great strides to reinstill confidence in the American public that our system emergency management preparedness can and does work effectively. In my view, there are three keys to our combined response: preparedness, command and coordination, and strong partnerships. And the first, FEMA and our State and Federal partners worked purposefully together to coordinate, assess, plan, train, exercise and evaluate to ensure that we each had independently and interdependently the capabilities needed to succeed in disaster response and recovery. And second, there was solid coordination and command at the Federal, State and local level. The emergency management structures in the State of Texas and Louisiana were impressive. At the Federal level, and consistent with the national response framework, we were fully integrated into the unified command with a State. Together we were forward looking, we executed our checklist thoughtfully and methodically, we adapted with a change in route and intensity to the storms, and we provided the public with timely and consistent warnings and messages. We performed as we planned and trained and we did well by doing so. And I wish to note that Governors, parish presidents, mayors and other elected officials fulfilled their responsibilities visibly and decisively as commanders, coordinators, and communicators. Secretary Chertoff was deployed forward himself in both States prior to and immediately following hurricanes, as was Administrator Paulison. They encouraged evacuation, they provided assurance that all actions that could be taken were being taken, and they actively got into the response and recovery, though a number of challenges and tried moments, forthrightly and with directness and without name-calling or finger-pointing. Thirdly, there was a strengthened partnership among the Federal agencies, and with States and with the local communities and among nongovernmental agencies from the Secretary to Governor to mayor, from Federal coordinating officer to State coordinating officer, and consistently through the field where there were individual team members who coordinated airbus to train evacuations, planned out delivery of commodities, registered evacuees, opened Federal medical shelters, opened medical stations and staffed deployable medical assistance teams. And they did so through the combined efforts and were impressive as they performed. Madam Chairwoman, I don't want to view the response and recovery of these hurricanes through rose-colored glasses, but collectively we demonstrated a capability to respond effectively to disaster. At times these efforts were admittedly a bit rough. Not all evolutions were according to plan. And we learned many lessons. We were challenged to get all the commodities to the right place at the right time. We learned that evacuation, for all of its challenges, can sometimes be easier than measuring the reentry of evacuees back in the damaged and marginally safe communities and homesteads. And we know that we need to strengthen certain elements of our workforce and to find ways to make registration process more timely and efficient. But from where I sit, the public was well served and we made great strides in instilling confidence in the Federal, State and local emergency management system and showed that it can work together effectively. Thank you for your time. I will be glad to answer your questions. Ms. Norton. Well, thank you Mr. Johnson. And may I commend FEMA for the assistance you gave the State and the city in the evacuation, apparently evacuation also in Texas. And you had these events back to back or front to front. Could I ask how the decision to evacuate is made, who makes it, what parties are involved, using as an example Ike and Gustav that has just occurred. Admiral Johnson. I think certainly the one who makes the decision to evacuate are the local elected officials. And I think you had a good example of that in Mayor Nagin, where all were concerned that after 2 years of like hurricanes that people might take the next hurricane too likely. Mayor Nagin and others stood up in front of their constituents and talked about the dangers of Hurricane Gustav, that at the time was a Category 4 hurricane, and made it very real from the local elected officials that people must evacuate. And so it is to the credit of Mayor Nagin, of parish presidents across Louisiana, of county judges in Texas, and Hurricane Ike, to make those calls early for mandatory evacuation and for voluntary evacuation. And as the mayor reported in his testimony, 97 percent of New Orleans evacuated, and that is setting a record for what can be done when the system works as it should. Ms. Norton. Now, most of those went on their own, didn't they? Didn't you have more people use their own transportation means than before, and, if so, why? Admiral Johnson. There were. I think I have seen estimates that maybe 1.9 million people across southern Louisiana evacuated, mostly on their own, because they had the means to do so. And in some parishes, in some cities, there are a population that don't have the means to do so. And they need assistance from the State and local government and from the Federal Government to evacuate safely. Ms. Norton. You perhaps heard me ask Mayor Nagin about the people who were warehoused, and he indicates that the State was responsible for finding places beyond boundaries of the local jurisdiction. Does the State have any communication with FEMA? Does FEMA have any responsibility since you are reliant so much on the States, for example, in your State housing plan, to ascertain that the State has found suitable facilities? Admiral Johnson. No ma'am, FEMA doesn't have responsibility. The responsibility lies with the State. But of course in hurricane planning we work with the State, we work with the Red Cross, to identify requirements and standards for shelters. And it is our expectation that as the State establishes State shelters, that they will do so following those recognized standards for service, for cleanliness, for security, for safety, for medical support, for food and water and those types of things. In Federal shelters, for example in the shelters that we establish with State out-of-state, we actually have a host State agreement where we lay out and identify what services we expect a host State to provide shelterees in order to be supported and reimbursed by FEMA. Ms. Norton. That is the out-of-state host State. But what about the in-state, the State that is primarily involved? Admiral Johnson. In-state, it is the State's responsibility. Ms. Norton. Do you tell them what you expect as well? Why tell the people out-of-state without telling the people in the State who may be responsible for most of the citizens what to expect, at least what to expect? Admiral Johnson. I think, being fair to the State, they had a number of State shelters, and we have heard about a couple of them, so there were a number of State shelters. Ms. Norton. Well, I want to ask about one. I can't imagine if there were a number of State shelters how 1,000 people wound up crowded in a warehouse in northern Louisiana, crowded in so tightly, with absolutely no way to bathe, feeling like herded animals. How did that happen if there were a number of State shelters? Were they crowded too? Admiral Johnson. Well, Madam Chairwoman, I think many people are asking that exact question: How did that happen? No one would have wanted it to happen. And it certainly does not comport with any requirements or guidelines. Ms. Norton. So there are guidelines that the State should follow in designating shelters within State? Admiral Johnson. Well, the Red Cross has standards for their shelters, and we certainly encourage and adopt those standards. And we encourages States to use those as they establish shelters. Ms. Norton. So you would find that the warehouse of 4,000 people with no way to bathe, and cot against cot, did not meet the standards that FEMA recommends to States? Admiral Johnson. They would not meet our standards, and I think Governor Jindal will tell you that they do not meet his standards either. Ms. Norton. I recognize the State has got to come to grips with that itself. But I am very concerned for FEMA in this regard. There were newspaper reports that were fairly chilling that, quote, many poor residents avowing never again, that never again were they going to get on a bus to be warehoused this way, they would rather ride it out. Now, that is the last thing we want to hear, because then it gets back to FEMA. That is why I am suggesting that you review your responsibility to advise the State. States may or may not be ready to shelter people because States aren't in the same business FEMA is, which is knowing much more about this. And it does seem to me that if States that shelter people from other States have guidelines, there is no reason why States themselves shouldn't have such guidelines. And we would ask that those responsibility of States not be recommendations. Of course it is--it could be, for that matter, an emergency where you could only do so much. There was warning of this hurricane. I talked with Mr. Paulison. He told me about out-of-state schools, places on military bases, he told me about places in community college facilities. And so I was stunned to hear that there was anybody who was housed in Katrina-like conditions. The one thing we are not going to tolerate is finger- pointing. We are really not going to tolerate, well, the State should have done that or the city should have done that. And the reason we are not going to is because if in fact these people don't evacuate next time, then of course the whole job will fall to FEMA to do something about people left in place. The Federal Government will have to evacuate them in very costly ways, as we did with people left behind before. So I am very concerned that Louisiana didn't meet its responsibilities and apparently didn't feel that it had to do anything but this, had plenty of time to prepare. After Katrina, it should have had shelters all over the State nearby ready to receive people. So just in the planning process that FEMA supervises, I am at a loss to understand this, and very concerned about it not only because of the condition of those people, because it may mean that we are going to have another problem the next time. Could I ask you in particular about some of the mayor's testimony? He indicated that FEMA would not pay, in his written testimony, for foundation demolition which could spur, of course, rebuilding and economic development. And he also said that you did not support panelized or modular construction for damaged properties. Would you explain why in both of those circumstances? Admiral Johnson. Certainly. In the demolition of a structure, FEMA has traditionally paid for the demolition of the structure itself but has not paid for the removal of the slab. That becomes a cost that, in Louisiana, the State has paid for some of that out of their CDBG funds. Ms. Norton. Removal of the slab; do you demolish it? Admiral Johnson. Right. Ms. Norton. And what is left of it, FEMA will not pay to remove? Admiral Johnson. That is correct. Our job is to remove the health and safety impact on the community, so in our view that is to demolish the structure itself. Ms. Norton. I don't know if that is one of the quick fixes that we put into the act that we are still waiting to come out of the Senate. But I have to say if we were willing to waive the State's share, the notion of not paying to remove what you demolished does strike me as being a very frustrating way to proceed, and maybe that we have to do more if you believe that you are proscribed by statute. And I would say then you shouldn't demolish unless there really is a danger, because you are making a mess. Now, I understand--what is this--FEMA resolutions do permit debris removal. This is not debris? You don't characterize this as debris for economic recovery? One of the things we had with FEMA was that it was reading its regulations so narrowly that we had to pass a whole bill. And what I objected to was that we thought a fair reading of the bill often meant that you could have proceeded. And instead we had to enact a whole bill. Now we have passed resolutions to permit debris removal for economic recovery, and you are telling me that you believe that you have to leave those slabs there. That is frustrating. I need you to look again and have your counsel review whether or not, in light of the resolutions--we will give you the numbers--there may be some removal of those. Now, can you talk about the panelized and modular construction for damaged property? You don't believe you can pay for that? Admiral Johnson. The Katrina cottage that you discussed with Mayor Nagin, as you recall, Congress gave $400 million 2 years ago to have an alternate housing pilot project among the States on the Gulf Coast. Mississippi, as the mayor indicated, got out ahead of the other States, and they have procured and installed these Mississippi cottages, now sometimes called Katrina cottages. They are a panelized house. They are in very good shape. Ms. Norton. So they are done with modular construction and panelized houses. So you will pay for it? Admiral Johnson. Well, these are modular--it is a modular construction. It is an improvement on a mobile home. I don't think I would call it panelized housing. It is a different style of housing. Panelized housing is much, much more expensive, and basically is sort of like a house in a box. But this cottage is transportable and it meets--again, it is an alternative to a mobile home or a travel trailer. The States of Texas, Louisiana, and Alabama also receive funding in this pilot project, but they have yet to produce a unit, and actually installed one for testing. Ms. Norton. So what do you think is the hold-up in those States? Admiral Johnson. It has taken those States longer to organize their governance structure to identify what their contract would be and how they would actually choose sites and install units. They have each had varying degrees of difficulty, but they are all about to come on line and soon will produce their units for testing. Ms. Norton. We are very anxious to see how those units work, particularly the fun we had with trailers. I called it a resolution; I am sorry. I asked your counsel to look at debris removal regulation 44, CFR 206.224(b)(3). I believe you--based on this resolution, the staff tells me you do have the authority to remove these slabs. We are just trying to do what we can to move this thing along. So I would ask your reporters to report back to us within 30 days what your counsel's view is. Admiral Johnson. Certainly. Ms. Norton. I am going to ask the Ranking Member if he has any questions for you, Admiral Johnson. Mr. Graves. Thank you, Madam Chair. Thanks, Admiral, for coming in. I want to talk to you about, or have you talk to me about the transitional voucher program. During Hurricane Ike it has been reported that 4,000 people checked into hotels underneath that program, but there were 107,000 that qualified for it, but there wasn't any space available for them. I am curious how you are going to deal with that or what you are looking at to try to deal with that. Admiral Johnson. The transitional housing program, sheltering, that we put out basically does say that we need very minimum requirements; that a person can call and register with FEMA and they would be assigned an authentication code. They could go to a hotel or motel that is part of the program. And thousands are. I think there are 8,000 hotel and motels that participate. And based on them having a room, they will accept an applicant and FEMA pays the bill. But as you would imagine during a disaster, these hotels and motels are filled and they don't have a whole lot of spaces available. We have heard reports that in some areas, because of prior bookings at hotels and reservations, that they didn't have room. And so we have checked them to find out, to make sure that all those who comply with the program and participate actually fully participate. But we had a number of people-- about every day 500 or more people move in and move out. It is a transitory type of a thing. And I think it has been fairly successful. We had about 800 or 900 at one time in Louisiana, and we have had up to 3,500 in Texas who have taken advantage of the program. Mr. Graves. And then one other question. The Red Cross has requested a $150 million bailout for its disaster operations, and I am just curious what the administration's position is on this. Admiral Johnson. I am not sure what the administration's position is, if they have actually offered the position. We have certainly--one of our strongest partners in preparedness, as well as in response to recovery, is the Red Cross. We have a great relationship with them. We have their staff members on our staff. We consult with the Red Cross. We establish our policies and do as many policies as we can in concert with the Red Cross. We were able to work with them during feeding kitchens, for example, in both Gustav and Ike. And so I am aware of the proposal and believe that there is support for that. Mr. Graves. Thanks, Madam Chair. Ms. Norton. Thank you, Mr. Graves. Mr. Arcuri. Mr. Arcuri. Thank you, Madam Chair. Thank you, Mr. Johnson, for being here. Mr. Johnson, the FEMA interim rule that eliminates administrative allowance in-state management administrative allowance, I want to ask you a couple of questions. They are utilized in New York to cover, as I imagine in many States, to cover direct and indirect costs. According to the National Emergency Management Association its costs States an average of 6.21 percent of their public assistance allocation to manage the administrative PA program, yet FEMA's rule would cap the allowance at 3.34 percent and States will be forced to cover that gap of 2.87 percent. I mean, in New York we estimate that is going to cost about $33 million. Any thoughts on how the States are going to make that up or what we are going to do, or any rationale as to why FEMA has cut that out? Admiral Johnson. We had a rulemaking out--covering administrative costs is always a controversial subject. We want the States to administer as much of the response recovery as they can. We want to reimburse them fairly for the cost of that administration. And it becomes a debate between us sometimes as to exactly what are those costs and how do we reimburse the right amount. We put out a rulemaking some time ago that offered a construct that was a change in the way we did business. We felt there was a bit of misinformation about that. It wasn't very well understood. And we have recently pulled back that rulemaking and are engaged now with NEMA and other representatives, again in the States, and talking about how we can fairly arrive at a formula that will reimburse the cost of the States. So it is still active discussion between us and the States to make sure we can identify what those costs are. Like anything else, I think that you have seen what are the numbers and what makes up those numbers. And we would be glad to meet with you or your staff and go through what our processes are and give you a sense of what our assumptions are and how we are engaged in discussions on the administrative cost. Mr. Arcuri. I would appreciate that. It just seems to me that with global warming, with the change in the environment, we are seeing more natural disasters. And this is not the time that we want to cut out programs that the States need but, rather, help the States more if we can. So I would greatly appreciate the opportunity for us to get together and chat about it. Thank you, sir. Admiral Johnson. Yes, sir. Mr. Arcuri. [presiding.] We are beyond the midpoint of the 2008 hurricane season. Do you think that we are in a position where we are going to be able to respond if there are any additional hurricanes that we encounter this year? Admiral Johnson. Yes, sir. We certainly think that--we have gone through about 5 weeks now. And hurricanes, this should only happen on weekends. But we went through about 5 weeks between Hurricane Dolly, Fran, Gustav, Ike, and I think that we have been tested, all of us, on a Federal, State and local level in this hurricane season, and we have done very, very well. I think it affirmed for us that we have invested a lot of time and resources over the last 2 years in fairly light hurricane seasons to focus on preparedness, on command and control, and on partnerships. And I think we have shown that that effort was worth its investment. And I think we have, again, reinstilled confidence that we can respond well to disasters. Part of our focus has been to put a stake in the heart of Katrina and put that behind us. And I hope that by the performance in Gustav and Ike so far that we are able to do that. Mr. Arcuri. Obviously it is a learning process. Did we learn anything so far in this hurricane season that you can tell us? We are always asking you about things. Are there things that we could do that could help FEMA in the future that we learned this year? Admiral Johnson. First of all, this Subcommittee is always intent on helping FEMA learn. And sometimes it is tough love, but we appreciate it. But I think from this hurricane season, maybe a couple of things to point out. First, as was indicated, commodities really point up--that is a problem we didn't expect. Now, how that system typically works is FEMA provides commodities to the State's staging area and the State manages commodities from there to distribution to PODs, to four points where they distribute PODs to commodities individuals. It didn't work very well. What we found in a large storm, we could move hundreds of truckloads of supplies into a staging area, but we couldn't get them out very efficiently. We actually sent our director of logistics, Eric Smith, down to Louisiana and sent him again to Houston to work through these issues about how do we really distribute commodities and get them out on time to the right place? And it is a very difficult, complex process and we eventually worked through it. So I think one of our focuses for next hurricane season is to work with the States on the full supply chain, end-to-end logistics, and to see how we can make sure we get the right supplies to the right place at the right time. I think a second area that we are working on is registration. And we have made huge improvements over Katrina. We have more than 1 million people who have registered between Gustav and Ike. At one point, at the same point in time, 12 days after the storm, we had 500,000 registered in Gustav and there were 350,000, same point in time, for Katrina. So they had huge improvements. And yet back-to-back storms really tested our system. What we have found is that we need to look more at new technology and to establish kiosk computer centers where people can register more on line. And so I think we need to look at new technologies to be more efficient in registrations. Those are two practical things that have caught us up a little bit in response and recovery that we are going to work on for the next hurricane season. Mr. Arcuri. Thank you very much, Mr. Johnson, I appreciate it. Thank you, Madam Chair. Ms. Norton. Thank you Mr. Arcuri. Let me ask you, I suppose perhaps I don't fully appreciate the difficulty of getting supplies out if there is planning. For example, if there are--if the State is required to say where the shelters will be in the event of a disaster it should not even be difficult to break that down in the event of a Category 2 disaster, 3 disaster: Where will the shelters be? If the States are required to do that, then everything, it seems to me, should flow from that. If I know that the shelters, in the case of a Category 3 type, will be in northern Louisiana, then I have a geographical area and regional area that I know I have to get to. I don't understand why preplanning won't take care of most of the issue. You make it sound as if you bring supplies in and then decide, oh my God, how are we going to get it out there? Indeed, I heard Secretary Chertoff say on television or radio that he had 18-ton trucks, or whatever, ready to go into Texas, but then they had to clear the roads. Well, Galveston, for example, was always going to be a complete disaster. Flooding was predicted to be the major issue. So I don't even understand 18-wheelers. I mean are helicopters, for example, an alternative to get food in, if as much food has not been prepositioned as you anticipated? Indeed, most of it should have been prepositioned. So I guess once you know where the shelters will be in the event of Categories 2, 3, 4, 5, it does seem to me that you have something going for you. You might not know where it is going to strike, but if planning means anything, then once it hits, you know exactly what you have got to do and you have prepositioned transportation of the kind that will be necessary, supplies of the kind that be will be necessary. And I hate to use this analogy, but I am going to have to, and maybe we need to consult with them. I bet the military will know what to do. They have got to figure out in advance what to do when they have got people located in much more unpredictable conditions than a hurricane. So I think this raises questions of planning, planning with the State, and particularly since your housing strategy says that you are very reliant upon the State, establishing some closer nexus besides we-recommend-to-the-State and we-hope-we- will-do-it kinds of things, because it is going to be in your hands largely, normally, to get supplies to areas that the State will often lack the kinds of transportation means to accomplish. Witness what the Secretary was trying to do with 18-wheelers. Admiral Johnson. Well, Madam Chair, what sounds easy in this room, absent a disaster---- Ms. Norton. It isn't easy. It is planning. Planning is the hard part. Admiral Johnson. What sounds easy in this room is if we were to lay out a plan for PODs in your city, in Washington, D.C., and expect that that plan would work perfectly in a disaster, it would be easy and the plan would be good. But what happens in reality is that in D.C., in Houston, in New Orleans, in Shreveport, as local elected officials evaluate the impact in their city, on that very night they determine where do they want the PODs established to meet the needs of their citizens, looking at who has evacuated, who has not, what part of the city has restored and what has not. Ms. Norton. And, of course, communication wasn't down as it was in Katrina. Admiral Johnson. Well, what happens is that every night they reestablish where they want PODs. So the plan you had before the disaster becomes ineffective when it gets changed late at night, and for good reasons. But once you have had a lot of PODs and you get a plan late in the evening it is hard to move inside--imagine the city of Washington streets. To move POD supplies, you need time to physically get it done. What happened in Gustav was that because of the reaction of the power outage and the change in the dynamics, the plan got put together too late in order to move all the trucks in time to open the PODs, when people were sitting there waiting. Ms. Norton. How do you account for that? Why do you think the planning occurred later than it might have? Admiral Johnson. I think it was people trying to react to the latest information, to really anticipate the needs of their citizens. And perhaps they haven't done it before. Everyone learned a lot of lessons. And by the third day, POD plans were put together at 4 o'clock in the afternoon and gave everyone plenty of time to supply for the next day. So they started off okay, they got bad for a couple of days, and got fixed again in a few more days. So it eventually worked itself out, but it took a little bit of adjustments along the way. Ms. Norton. How about activated or nonactivated food stamps, the frustrations of long lines and getting food stamps? It took some days to get them activated. Were you trying to avoid fraud and did it need to take so long? Admiral Johnson. I personally don't have any knowledge of that. That is another program. We observed that happening in Louisiana, and perhaps it could happen in Texas, but that is beyond FEMA's scope and I don't have any details of that. Ms. Norton. Was it beyond FEMA's scope because the State provided the food stamp activation? Admiral Johnson. Well, the food stamp is with USDA. And the USDA worked with the State in trying to coordinate the efficient delivery. And I think there were just some logistics issues about times and locations, and it got backed up. But I don't have any personal acknowledge of that program. Ms. Norton. Well, I am not going to ask FEMA to provide us with that, but those were among the loudest complaints that we heard. Now, I would like to quickly go through this housing, new housing strategy. And I recognize that you are still in comment, that is why we wanted to have the hearing before the comment period was ended. It would be helpful for us to know what the major elements of the strategy is, especially those that differ from FEMA's Disaster Housing Strategy, previous Disaster Housing Strategy? How do you think--why do you think this is better? Admiral Johnson. Well, perhaps the most significant issue is it does delineate, again, what are the roles and responsibilities of the Federal Government and of the State. And during Katrina, where FEMA took over almost the entire management of the housing program, those roles and responsibilities became too blurred. And so, for example, in Texas today, Texas has identified today what their level of acceptable formaldehyde is. FEMA doesn't have to do that. That is their responsibility. Today Texas requested, the government request, first, to provide a direct housing program in the city of Orange in Jefferson County. That is their job, ask for direct housing. Texas will tell us what type of housing they want, which is their job. We provide options, they select the option, we implement. And then over the next several days now, we will implement that program to meet the objectives of the State. And so in this case, the State should make those decisions that FEMA should implement and help them achieve their objectives. That is a primary focus of the strategy. Ms. Norton. Now, the States on whom you, of course, rely in your housing strategy, I think appropriately so, we then need to look at your relationship to the States. Now, according to your own people, only eight States have their own disaster housing programs. That is bothersome. I am not sure which States those are. But how can you rely upon the States if they are not required to have a disaster housing program by FEMA? Admiral Johnson. Part of what FEMA will do to implement the strategy, for example, when we put EMPG grants--and you are familiar with those grants, those are focused on emergency management--we will require States to devote some portion of those grant dollars towards disaster housing planning. We have not previously done that. In a disaster, for example, in Iowa, in Louisiana, and in Texas, we have asked the State to stand up a State-led housing task force. They each have complied and done that. So what we are finding is the States are receptive to the objectives of the strategy. And it has worked out very well thus far in Iowa, I think it will work out well in Texas, and work in Louisiana with Gustav implementation, and I believe it will work out there as well. Ms. Norton. Now, we had a situation in Katrina we hope we will never have again. But because FEMA is best suited, in fact its mission is to help people to find short-term everything, everything is supposed to be short term. But after Katrina, as you now look at who is left, we find that 12 percent of those displaced were over the age of 65. Now, how does--your self-sufficiency approach, of course, is the correct approach--how does it take into account when we are dealing with people who can hardly be expected to start all over again in providing housing? Some of them are living in senior citizens housing, some of them live in their own homes and at their age will not rebuild, and therefore whatever the State's responsibility, you are going to be left with these displaced victims. How do your present policies enable you to in fact account for these victims? Because you can keep setting dates when they have to find housing all you want to, but the fact is that given their vulnerable state, the Nation is going to look to you, considering the increasing number of elderly people. Consider the baby boom, for example. They are not there yet, but they will be there and they are living longer. What is needed? Is it new statutory authority? What are you going to do now about the thousands who are among those still without housing in trailers and otherwise not in permanent homes? How do you expect to deal with them in your new housing strategy? Admiral Johnson. In a disaster where there are elderly or other perhaps more challenged community groups, as in Katrina, what will end up happening, I believe, is that some of those people will eventually filter into another existing government program. For example in HUD, HUD has a program for section 8 housing. HUD has a program for some of the elderly that have been exempted, by the way, for some of the payments on their rent. And eventually when it gets down to that smaller group, at this point in the disaster they will likely be placed by case management into some existing program. We are very focused, as are you, on looking and learning more about effective case management and how to identify these people earlier and to put them in the right program to meet their needs. Ms. Norton. Long-term needs were really put on the map by housing needs by Katrina. And you did something that seemed to make sense. States were told that they could lease apartments for up to 12 months. But then you told the States to terminate those leases after 6 months. How will lease management be handled under the new housing strategy? Admiral Johnson. That did occur before. And what we have now, partially in response to Congressman Graves' question, what we have now is our transitional assistance program that we just implemented here for Ike and for Gustav, where now we put people into hotels and motels and we pay that hotel and motel bill. It is 30 days at the outset, and if we need to extend it we have the option to do that. And so we will try to manage that individually. We can also pay the hotel directly, as in this case. We may look at leasing portions of hotels so that we can move people in and out of a room that we are already paying for. So I think we have come up with some good lessons learned. We are implementing a more targeted program that allows us to manage the cost a lot closer. Ms. Norton. We were concerned that the GAO's 2007 report said they found certain kinds of shelters without feeding capabilities when they did a survey of selected States. Do you look at feeding capabilities in particular? I suspect that the warehouse in north Louisiana would have been such a place. Must a shelter that the State designates have the capacity to feed people--kitchen, some way to make sure that food can be stored and the like? Admiral Johnson. Well, I think perhaps Joe Becker or Red Cross can answer that question better than I can. We don't require every shelter to have a kitchen, but we require shelters to be able to provide food and water and basic life sustaining support. Ms. Norton. I don't mean an actual kitchen, I mean the capacity to have running water, a makeshift kitchen. Admiral Johnson. And we require that. We also have worked with the Red Cross and with the nongovernment organizations on building feeding kitchens and feeding capabilities. For example, in Houston where we have shelters, we also now provide a separate feeding kitchen that provides--all through Texas I think--it is a phenomenal number of meals that are able to be prepared every single day. And so we now are taking a much more focused look at how we provide shelters and how we provide feeding capability. Ms. Norton. You work with the State. I need to know within 30 days what FEMA tells a State its shelters are expected to look like. Admiral Johnson. Yes ma'am. Ms. Norton. This question keeps coming up as I find out about the kitchens, the shelters and the feeding. So rather than ask that question over again, it would help me with this blanket question to say what is it that FEMA tells States that a shelter must provide; where shelters must be? Admiral Johnson. We can provide that for the record. Ms. Norton. Thank you. Finally, I would like to ask you about the Red Cross. Our final witness is going to be the GAO and the Red Cross. We were very concerned to hear about the nonprofits on whom you rely. How much do you rely on them, and what is your view of their capacity to handle the mission you expect from them as these hurricanes and other disasters become more frequent? Admiral Johnson. We rely on the Red Cross and nongovernment organizations, Catholic Charities, Salvation Army, we rely on them a lot. They are in the local area, they know the local people, they know the geography, they understand the culture. Ms. Norton. Well, what did the GAO mean when they said they believe they are overwhelmed? Is that your view? Have you worked with them in Ike and Gustav? Did you find them able to manage the responsibilities as expected? Admiral Johnson. Well, I think as you saw in our comments, we don't think very highly of that particular GAO report. We believe that the report---- Ms. Norton. In what way do you differ from the report? Admiral Johnson. Well, I think the report, for example, I think it expected the Red Cross and nongovernment organizations be the primary provider of support to disaster victims. To my knowledge, the GAO did not interview the emergency managers in the State of New York, in Texas, or California or Florida. All of those States have magnificent well-organized local support programs. And the State is responsible for providing for that support. Ms. Norton. So how did they get the impression that they couldn't handle--that the Red Cross in particular, if they got the impression the Red Cross was responsible for the bulk of it, they most have gotten it from the Red Cross. They must have told them it was falling to them. Admiral Johnson. I am not sure how they got that idea. I am not sure if they had a visitor's shelter before. They didn't get that idea from us, and I don't think they got it from talking to---- Ms. Norton. Well, I am not going to put the burden on you. I just thought you would like to give your opinion of the role of the Red Cross. Do you feel that they are doing an adequate job, in terms of their funding, in terms of the carrying out their mission and the like? Admiral Johnson. They have been phenomenal partners. They help us immeasurably, in measurable ways and immeasurable ways, in helping to organize the delivery of mass care services to disaster victims. They do a great job, in and of themselves, they do a great job to link with all the other NGOs and to coordinate them and help bring together disparate groups. Ms. Norton. So you have no recommendations for improvement by Red Cross and other nonprofits who assist FEMA? Admiral Johnson. Well, I think our recommendation on improvements is we can always continue to work better today, communicate better, and to be better organized. Ms. Norton. Well, you have had two recent hurricanes. Admiral Johnson. And they have done a great job. Ms. Norton. All right. As far as you are concerned, you are perfect so we will pass on that. I have to ask you one question, since you talked about the States and prepositioning. You even mentioned the District of Columbia. There may be other big cities like the District of Columbia. They are located in a State that doesn't have many big cities. We are not even located in a State. We treat it as a State for all purposes except to vote. But when you hear for the 50 States and the District of Columbia, that is us. If there were to be a disaster, and not more than 5 years ago we had a major flood here--but of course it was positioned in part of the city, not the rest--but if for some reason, it would likely be a terrorist attack where somebody set off something, and we had to be moved, it has crossed my mind more than once whether FEMA has determined where residents of the District of Columbia, not a State, very small area, less than 10 square miles, where would the residents of the District of Columbia go if they needed sheltering tomorrow? Admiral Johnson. We have a program called gap analysis, which we may have briefed you on before. And we work with the hurricane--18 hurricane impact States, the District of Columbia, Puerto Rico, Virgin Islands, and we assess them on how ready they are for a disaster. We work with the emergency manager in the District and have gone through sheltering, transportation, communications, medical services, have a sense of what their capabilities are. Ms. Norton. Admiral, I asked where would we go. I am assuming that a certain percentage of the population had to leave town. Do you know where such residents would be directed from the Nation's Capital to go? Admiral Johnson. There is an existing national capital regional evacuation plan that identifies routes in the city, and they would go to the suburbs and go to the neighboring States. I would be glad to have a staff come by and brief you completely on that. Ms. Norton. I would like you in 30 days to tell me exactly what you say if you have got to go to a shelter out of state, that there is planning, prepositioning, where you go. And I realize some people live in Southeast, some people live in Northwest. In 30 days I would like to know where the residents of the District of Columbia--a fair number are Members of Congress, a fair number are Federal officials, and many are residents of the District of Columbia. I don't want to know the routes, I know the routes. And about the last thing you want to do--in fact, we tell people stay in place--the last thing you would want to do is say they will go to, quote, the suburbs. The notion that the suburbs would say you all come is hard to believe. Admiral Johnson. We would be glad to review that shelter plan with you. Ms. Norton. Thank you very much. We want places that have been designated. I am going to ask the Chair of the Full Committee if he has any comments or any questions for Admiral Johnson. Mr. Oberstar. Thank you, Madam Chair. Thank you, Admiral Johnson, for being here with us today. I think the Chair has covered a wide spectrum of issues that we anticipated to cover in this hearing. The question that may have been asked while I was attending to other Committee business is what research, development, testing, has FEMA accomplished on housing, that is mobile housing, that does not have the adverse health effects that have been associated with the FEMA trailers? Admiral Johnson. There are two things. First is that we have new contracts for mobile homes and park model units that require formaldehyde to be at the level of.016 parts per billion of formaldehyde. There has never been a requirement that low before for construction. We worked with the manufacturers of mobile homes, changed out building materials, changed out manufacturing processes to ensure that they can actually produce units that are that virtually low in formaldehyde. We have already taken delivery on some of the units, and we will take delivery on additional units at the end of October. So our first effort has been to reduce the level of formaldehyde in these units. Mr. Oberstar. Repeat that figure that you said a moment ago. I didn't write it down. Admiral Johnson. It is .016. Mr. Oberstar. .016. Admiral Johnson. Second is that we have looked extensively for alternatives to mobile homes and park models. We recently put a contract out on the street asking for innovative ideas, and we are going to buy and test different concepts for how to replace a mobile home and a travel trailer. And I think we are going to find a number of alternatives that will give us more flexibility based on where we might need units, in dense, urban areas versus in colder climates or the gulf. Mr. Oberstar. What are your requirements for mobile housing, that is, standards or requirements for ability to move these units from one place to another? Do they have to be of a certain size, certain weight, dimension and readiness to be put into use? What are the standards that you have established for the housing? I ask the question because I get, and I am sure Chair Norton as well, visits from various organizations that say, well, we have something really hot for FEMA. And I haven't sent any of them to you, because I don't know what your standards are. What are those standards? Admiral Johnson. Mr. Chairman, first let me just correct: It is .016 parts per million. I said parts per billion. So, .016 parts per million. Mr. Oberstar. I thought that was---- Admiral Johnson. We will provide for the record. It is a one-sheet requirements in our contracts for mobile homes. But it defines the length of the mobile home so it fits on the highways, the width of the mobile home, what the equipment is required inside the mobile home. So we can provide that to you for the record, if you would like. Mr. Oberstar. That would be very useful, Because there are many people who are interested in these issues. It receives such nationwide attention, it is hard to run into a constituent, let alone people from other parts of the country, who aren't aware of FEMA trailer problem. It is one word, there is no hyphen, there isn't even a space. It is a "FEMA trailer problem." Admiral Johnson. Mr. Chairman, don't be bashful to send them on to FEMA. We have established a joint housing solutions group, and they are looking for new ideas. And they will meet with a vendor, and they will talk with them about our requirements. So if you want to forward them to us, we would be glad to talk to them about our program. Mr. Oberstar. In the interest of full disclosure, my wife is from New Orleans, born and raised there, still has family there. We visit there frequently. And we went into one of those trailers, closed for quite some time, and the aroma would knock you over. Admiral Johnson. Yeah. We have learned a lot---- Mr. Oberstar. This is not a figment of anyone's imagination. I can't imagine living in this thing. Admiral Johnson. It is not. We have learned a lot of lessons from the units that we bought for Katrina. And, again, I think you are seeing us reflect those lessons learned by finding alternatives and by requiring now a very, very, very low level of formaldehyde. And, by the way, we test these units to make sure that they meet our specification. They don't pass the test, we don't buy the unit. Mr. Oberstar. Do you have energy consumption standards for those trailers as well? Admiral Johnson. I don't believe we have energy consumption. There is a rating, depending on the climate that they are involved in, a level 1, 2 or 3 climate. Mr. Oberstar. Okay. I welcome that information whenever you can provide it. What is the status of the Disaster Relief Fund for the balance of this year? Admiral Johnson. Dire. We just went below a billion dollars, which sounds like a lot of money but in disasters is not much. And so we are looking at the cost of--right now our projected cost for Gustav and Ike is both--let me say each, about $800 million each. And so these are catastrophes. When we project the life of the Disaster Relief Fund, we typically plan for a hurricane season absent a catastrophe. And now we have had the Midwest floods and Ike and Gustav. So we are concerned about the size of the Disaster Relief Fund. Mr. Oberstar. Do you have data available in FEMA on the amount that the private insurance sector has paid out on the Iowa floods, Ike and Gustav and so on? Admiral Johnson. I don't know that we do, but we will check. If we can get that, we will provide it to you. Mr. Oberstar. Our staff regularly tracks that information, at my direction, and have done over a period of years, and they have seen this very sharp escalation of private-sector insurance costs in FEMA States' local disaster assistance. We are running into the dozens of billions of dollars of cost. Admiral Johnson. Yes, sir. Mr. Oberstar. And it is a steady progression over the last 20 years. I mean, this is parenthetical to the discussion at hand, but for anyone to say that we are not experiencing global climate change, they are not living on the same planet. Those figures are unavoidable. Will FEMA have to ask for supplemental funding, do you think? Admiral Johnson. Well, of course that is a judgment for the administration. But we are working with them to---- Mr. Oberstar. But you say you are below a billion dollars, and we are still not finished with the hurricane season. There is another one brewing in the south Atlantic, I heard this morning on The Weather Channel. Admiral Johnson. Yes, sir. Mr. Oberstar. We could be facing more. Admiral Johnson. It is true. You know, we are concerned about the balance, and we are working inside the administration to see if the President wants to propose a supplemental. I don't believe a decision has been made on that yet. Mr. Oberstar. We had passed, with Chair Norton's leadership and effort, a bipartisan bill from the House. The Senate, there are stirrings over there. You just never know what is going to happen. Every now and then, the water moves, like the Old Testament, water stirs, you jump in it so you will be saved. But every now and then, we see stirrings. And it may be that we will have a FEMA authorization bill. Is there any additional authority or expanded legislative authority you might need to address the recovery from Gustav and Ike? Admiral Johnson. We are looking at that to see whether we think we need more authority. One thing that we are doing, Mr. Chairman, and I think Madam Chairwoman mentioned as well, we think over the years our regulations and our policies have become increasingly restrictive. And so we are currently in a program to look at rewriting our regulations to give us more flexibility in changing policy to reflect lessons learned. And so that is our primary focus, is fix the regulations and policies. And Stafford, in itself, is still a pretty good piece of legislation, as you know personally. Mr. Oberstar. All right. I don't need to pursue this any further. We have two more witnesses to accommodate. And, Madam Chair, thank you. Mr. Johnson, thank you. Admiral, thank you very much for being here. We look forward to receiving your response to those earlier questions. Ms. Norton. Well, thank you very much, Mr. Chairman. By the way, that was a blockbuster, that last thing you said, that during the review of your legislations, in light of present-day realities, to eliminate some of the rigidity. When do you expect that to be completed, please? Admiral Johnson. We are working right now on--we have looked at our individual assistance program, and we have identified three regulations in individual assistance, three regulations in public assistance, and 10 policies that we are reviewing right now to, again, reflect lessons learned and provide more flexibility. We are working the reg packages as we speak and reviewing those policies, and we certainly hope to get those out within this calendar year. Ms. Norton. Would those be out for comment? Admiral Johnson. Yes, ma'am. Ms. Norton. Yeah, well, we would be delighted to see you able to do that before this administration ends. Admiral Johnson. So would we. Ms. Norton. Thank you. Well, thank you very much for very helpful testimony, Admiral Johnson. And could I ask the final two witnesses if they would come forward? Thank you for your patience. They are: from the Government Accountability Office, Cynthia Fagnoni; and from the American Red Cross, Joseph Becker, who is the senior vice president for preparedness and response. We will go with Ms. Fagnoni first. TESTIMONY OF CYNTHIA FAGNONI, MANAGING DIRECTOR OF EDUCATION, WORKFORCE, AND INCOME SECURITY ISSUES, GOVERNMENT ACCOUNTABILITY OFFICE; JOSEPH BECKER, SENIOR VICE PRESIDENT OF PREPAREDNESS AND RESPONSE, AMERICAN RED CROSS Ms. Fagnoni. Madam Chair and Members of the Subcommittee, I am very pleased to be here today to discuss our findings from a report we issued last week on voluntary organizations' disaster response. This afternoon I will highlight what we found in four areas: the roles of voluntary organizations in providing mass care and other services in large-scale disasters; their efforts to improve since Hurricanes Katrina and Rita; their current capabilities in four large cities; and the remaining challenges for these organizations. In doing our work, we focused on the Red Cross, the Salvation Army, the Southern Baptist Convention, Catholic Charities, and United Way. We also visited Los Angeles, Miami, New York, and the Washington, D.C., region. First, the five voluntary organizations we reviewed are highly diverse. The American Red Cross is the only one with a designated role as a support agency for mass care under the Government's National Response Framework. Both FEMA and the Red Cross agree that the Red Cross will support FEMA with staff and expertise in responding to a catastrophic hurricane or earthquake. However, this agreement is not clearly documented in the Catastrophic Incident Supplement to the framework. In our report, we recommended that FEMA update and document its expectation for the Red Cross in a catastrophic disaster, and FEMA agreed. Second, our report also found that the voluntary organizations we reviewed have taken steps to strengthen their service delivery. For example, the Red Cross has initiated thousands of new partnerships with local community and faith- based organizations, particularly in rural areas with hard-to- reach populations. These organizations also are collaborating more on feeding and case management and on improving their supply chain management and communication systems. Third, our report found that voluntary organizations have substantial sheltering and feeding resources both locally and nationally. However, without government and other assistance, a worst-case, large-scale disaster would likely overwhelm voluntary organizations' current mass care capabilities. For example, a catastrophic earthquake striking Los Angeles could create the need to shelter more than 300,000 people, but the Red Cross can shelter 84,000 locally under the best conditions. And a nuclear terrorist attack in Washington, D.C., could require 300,000 more meals per day than the Red Cross can currently provide. Because such disasters call for a communal, all-hands-on- deck response, government employees in New York City and elsewhere are being trained to provide sheltering and feeding in a catastrophic disaster. FEMA has also developed some contracts with private-sector companies to provide resources as well. Our report found that FEMA's initial assessment of mass care capabilities in selected States did not include the sheltering capabilities of all voluntary organizations and did not address feeding capabilities outside of shelters. Our report recommended that FEMA take steps to better incorporate voluntary organizations' capabilities into its assessments of mass care capabilities. FEMA disagreed, saying that Federal, State and local government cannot command and control private- sector resources. However, FEMA is required, under the Post-Katrina Act, to establish a comprehensive system to assess the Nation's overall preparedness. Such an assessment should account as fully as possibly for voluntary organizations' capabilities. Taking steps to assess capabilities more fully does not require controlling these resources but, rather, cooperatively obtaining and sharing information. Without such an assessment, the Federal Government will have an incomplete picture of the mass care resources it could draw upon in large-scale disasters, as well as of the gaps that it must be prepared to fill. And finally, voluntary organizations continue to face challenges in preparing for large-scale disasters. Reliant on volunteers and donations, many organization struggle to raise private funds to help them better prepare for future disasters, especially potentially catastrophic ones. While FEMA told us some Federal emergency preparedness grants could help, its guidance did not clearly state that voluntary organizations could be considered among those as eligible subgrantees. In our report, we recommended that FEMA clarify States' ability to consider voluntary organizations as among the potential recipients of Federal preparedness funds, and FEMA agreed. In conclusion, recent events bring home once again the critical role of the Red Cross and other voluntary organizations at such times, as well as the importance of preparing for large-scale disasters. As it stands now, the Nation is not yet as prepared as it needs to be to shelter and feed survivors of a catastrophic disaster. This condition includes my statement. I would be happy to answer any questions you may have. Thank you. Ms. Norton. Thank you very much, Ms. Fagnoni. Mr. Becker, of the Red Cross. Mr. Becker. Chairwoman Norton, good afternoon. My name is Joe Becker, and I lead the American Red Cross disaster relief efforts nationally. Thank you for your invitation to speak here today. I was asked to address two issues: the GAO report on mass care capabilities in catastrophic events and how the nonprofit sector organizes and responds to disasters. I will start with how the sector works. I think the best word to describe how the nonprofit sector works is "layers." If today is an average day, the American Red Cross will respond to about 200 disasters around the country, and most of these will be very small. It is an apartment fire, it is a transportation incident. We are called on the scene by a local fire department, and we respond. We don't pick and choose which disasters we respond to; we always respond when called. The things we do in a very small disaster, say, an apartment fire, are the same things we do on large disasters. We provide a safe shelter for people, and we feed them in the shelter. We feed the community at large, driving through neighborhoods that are affected. We distribute supplies that are over and above what Admiral Johnson was referring to in points of distribution, or PODs. We provide mental health with volunteer psychiatrists, psychologists, mental health professionals. Our nurses provide first aid and minor health- care treatments. And we provide safe blood and blood products. I described the very small disaster that the Red Cross typically responds to alone. If something is a little bit bigger than that--you live here in the District; remember the recent flooding adjacent to here in Fairfax County--if a disaster is a little bit bigger, we will be joined by great partners that we work with very closely. They are typically faith-based groups. Catholic Charities, Southern Baptists and the Salvation Army would be the primary ones that typically join us on larger-scale relief efforts. Then, if something is quite large--the Midwest floods, Ike, Gustav--we are joined by a large number of organizations. On something that big, everyone wants to help, and no one more so than the faith communities. And you will remember in Katrina, that was one of the frustrations people had. A church or local group would want to open up a shelter or open up a kitchen, and, frankly, after 2 or 3 days if they fatigued, if they turned to the American Red Cross for support, they got varying answers depending on where they were. Our biggest lesson--and you heard the GAO report address it--is, how do we bring community groups together to serve? And that is what we have been about post-Katrina. In a disaster, 90 to 95 percent of the people take care of themselves. They check into a motel, they go stay with mom, they stay with friends, they stay with family. It is the 10 percent, maybe 5 percent, of people who can't care for themselves or don't have those options, that is who the American Red Cross cares for in disasters. They are older than the population at large. They are poorer than the population at large. And, typically, they are less healthy than the population at large. It is the frail elderly, in particular, with which we spend an awful lot of our time and service. And what we have been about post-Katrina is bringing other organizations who can help with those people into the operations. Nationally, we have about 150 partnerships with organizations that don't have a disaster mission but can help in time of disaster: examples like the Urban League, the NAACP. In fact, in Mayor Nagin's city, the NAACP is who helped the Red Cross distribute meals post-Gustav. We have done a lot here. We have thousands of partnerships, particularly on shelters where we train a church, equip them, supply them, pay their bills after a disaster. That way, we make sure we are serving a very inclusive response; geographically and demographically, we are reaching everybody that we should. The best outcome is local people helping local people before the Red Cross brings large numbers of volunteers from all around the country in to respond. How is the sector coordinated or organized? The American Red Cross has a primary mission of disaster relief. There are eight other national nonprofits who don't have a primary mission for disaster but who take a role and bring value in time of disaster. The new National Response Framework tasks the American Red Cross with integrating the efforts of the nine national nonprofits who deliver service and disaster relief, and we do that. We share information, and we plan service delivery. Locally, though, in over 3,000 counties, that organization is done in various ways. Sometimes the Red Cross coordinates other nonprofits. Sometimes the local emergency manager does. Sometimes another organization will. That is a local decision. And we receive great support from FEMA, who has people in each of its regions who help coordinate the voluntary sector as well. Addressing the GAO report, I would like to be very clear here. We have used the word in this hearing several times today: ``overwhelmed.'' What we are talking about is: are we ready_the Red Cross and our nonprofit partners_for a catastrophic event? That is not the California wildfires or Hurricanes Ike or Gustav or any of those disasters. I think we have demonstrated in those disasters our ability to respond and to respond well. Post-Katrina, the American Red Cross made significant efforts and investments to improve our capabilities. And part of that was to quantify our worst-case scenarios. Not necessarily disaster scenarios with large numbers of fatalities or casualties. Rather, we were looking at what scenarios would most stress our ability to feed, our ability to shelter, our ability to distribute supplies. And we picked six scenarios, as outlined in the report. So, for example, the most catastrophic thing that could hit New York was a hurricane, not in terms of number of fatalities or casualties, but in terms of demands on sheltering, demands on feeding. Another scenario was a terrorist attack here in the District, and we looked at other scenarios as well. We fed that information to FEMA as part of their gap analysis, but our internal data is what the GAO used in the report. For example, here in the District, you said we would need to shelter 300,000 people and we only have spaces for 13,000. I think what the report from the GAO might not recognize is, if something happens here in the District, the sheltering is not going to happen here in the District. To your point, Madam Chairwoman, they are going to go to a multi-State area. And we have modeled this out. And we have 718,000 shelter spaces in the multi-State area around the District. And if we needed to add Pennsylvania, that would add another half-million shelter spaces. And, again, typically, we are only sheltering 5 to 10 percent of the people who evacuate. The bottom line: we obviously agree with the GAO assessment--it was our data that they used--that we are not ready for the worst things that we can imagine. We were trying to look at disasters that would make Hurricane Katrina look small, and those were the scenarios that we were working with. The Nation is not ready for disasters that would make Katrina look small, and the American Red Cross is not ready to deliver mass care on that type of scale. Our numbers show that we have a long way to go. But it is the nature of a catastrophic event that no one organization can handle it all and Government can't handle it all, the Federal Government, nor the Red Cross, nor our partners. It is the collective capability of the country that we need to address and make sure is big enough for a catastrophic event. And, finally, Madam Chairwoman, my key issue, and it has been covered several times in this hearing: it is the money, where it comes from, and who pays for what in terms of nonprofit mass care service delivery. Our work is typically funded by people who give. And, typically, when Americans see a large-scale event, they are very generous in supporting nonprofit service delivery. Our recent experience has been different from that, however. We have had so many disasters, and in a tough economy we have been having trouble raising the cost of our relief effort. But it is one thing to ask a donor to pay for feeding and sheltering and caring of people. It is very different to ask Americans to pay for what it costs to be ready to respond to a disaster: for warehouses, for call centers, for recruiting volunteers, for training those volunteers. That is very, very hard. And the GAO report correctly states that nonprofits are an integral part of mass care. We are the service delivery. It is not a layer-on or a nice-to-have. We are who do that work. And if we falter, the Nation's response will falter. The GAO report also correctly states that the Red Cross and its partners need to build greater capacity. We do, and we understand that. The GAO report, finally, correctly says that nonprofits are largely shut out of the grant process to build this capacity. While FEMA intends nonprofits to be eligible, we have to go through a county or State to receive grant money. And, frankly, they are the decision-makers as to whether we would be included in that grant process or not. A simple solution to this that I commend to your attention is to allow national nonprofits, particularly those with NRF responsibilities, to apply directly to FEMA for capacity- building grants. This is simple; this is relatively easy to do. It makes a lot of sense, and it would make a big difference. In closing, the Red Cross has built a lot of capacity in recent years, we have been repeatedly tested, and we have performed well. But there are catastrophes that we can imagine that will make Ike and Gustav and all the recent events look very, very small. These will make Katrina look small by comparison. We can imagine these events, and we need to get ready. And, Chairwoman Norton, we appreciate your support. Thank you very much. Ms. Norton. Well, thank you, Mr. Becker. Let me start with Ms. Fagnoni. You indicate that the Red Cross and similar organizations would be overwhelmed, in the context of having to deliver services. Was the Red Cross overwhelmed in Katrina, for example, during Katrina? Ms. Fagnoni. We did issue reports after Hurricane Katrina that highlighted issues and problems that the nonprofit sector did encounter, including the Red Cross, and made some recommendations, both to the Red Cross as well as to FEMA, on how to make those improvements. I think the Red Cross would agree with me that Katrina really tested that sector and the Nation's ability to respond to that kind of disaster in a way that they hadn't really been tested before, in terms of the scale. Ms. Norton. I know that the State was overwhelmed. I know that FEMA was overwhelmed. I am asking, in your view, was the Red Cross overwhelmed as well? Ms. Fagnoni. It definitely faced challenges, yes, and had difficulty---- Ms. Norton. I am trying to find out what "overwhelmed" means in the context of service delivery. Ms. Fagnoni. What we were really looking at and what we were asked to look at by a number of the congressional requestors who asked us to do this work was to look at the catastrophic incident supplement; what would happen in a really major catastrophic event, Katrina or larger---- Ms. Norton. And so, how do you define catastrophic incident? Ms. Fagnoni. For purposes of our report, we based it on the kinds of scenarios that had been developed by FEMA and by the Red Cross to look at a situation where there was widespread destruction, potentially large loss of life, significant communications destruction, really major---- Ms. Norton. So would Katrina---- Ms. Fagnoni. Katrina or worse, yes. Ms. Norton. Okay. We can't even imagine worse. But I think Katrina gives you all you need to know to know about a catastrophic event. Although, Congress does not define--I guess that is left to the President. So I am trying to, given the scenarios you have looked at, to understand when would we know that the Red Cross was overwhelmed? When it didn't have enough people to deliver the service, is that what you think is going to happen? I mean, after all, they only have the supplies that they have, and they usually come from the government. So I am trying to understand what makes you believe-- whether there has been an event that made you understand that, based on their performance at that event, they were overwhelmed there, so they would certainly be overwhelmed in event of a catastrophic event? Or whether you were looking at certain indicators to say, in the event of some scenario? Ms. Fagnoni. That is right; we were looking at the scenario planning. Ms. Norton. As far as I am concerned, you have had the scenario. If Katrina wasn't a scenario, then I don't know what we are waiting for. Normally, we have to do these things by computers. There it was done for you. But go ahead. Was there a scenario that, for example, fed off of Katrina? Ms. Fagnoni. Yes, I believe there were scenarios that looked at hurricanes that were at least as large as Katrina. Ms. Norton. Okay. So, in what way would they be overwhelmed? Ms. Fagnoni. We were looking specifically at the mass care pieces of the puzzle, which is where the voluntary sector really provides the services. And it was a combination of, in some cases, the capacity in terms of sheltering space, combined with the availability of trained_whether it is volunteers or staff_trained people to staff those facilities. For example, in New York City I believe, the Red Cross identified a lot of bed space, shelter space, something like 300,000. But what they also identified was a limited number of volunteers or staff who were trained to staff those shelters. Ms. Norton. Now, who does the training? Ms. Fagnoni. The Red Cross does a lot of its training, and they also cross-train with other voluntary organizations. But what we also note in the report is that the local governments, in conjunction with the Red Cross, are planning and doing their own training. For example, New York City has plans to and is training its own city employees, so they can staff shelters in the event of, let's say, a catastrophic occurrence. Ms. Norton. That is unusual. So the training has to come from Red Cross or Red Cross volunteers. New York is a mega- city. Ms. Fagnoni. In Los Angeles, I understand that the Red Cross is helping train city employees there. Ms. Norton. So do you believe that cities should be training city employees to assist the Red Cross so that it will not be overwhelmed? Ms. Fagnoni. I think the way New York City is approaching this is they have plans to staff up shelters initially, and then the plan is, in working with the Red Cross, that they could turn that capability over time to the Red Cross, but they would be able to step in to try to provide some surge capacity. Right now, for example, what you had in Katrina is there were a lot of entities that stepped up. There were places, as I think Mayor Nagin made reference to, where the Red Cross didn't set up shelters and these, what were called, pop-up shelters emerged, where churches and other organizations would set up sheltering. But what we and others found is that the people who set those up were very well-intentioned but often didn't really understand what they were getting into; didn't have the training, didn't understand all the things that go with trying to set up a shelter. So I think people are learning from this and trying to understand. The voluntary sector, as important as it is, cannot do it alone and wouldn't be expected to do it alone in a really large-scale disaster. So this kind of gap analysis and assessments that the Red Cross and FEMA have been doing we think are helpful in helping people understand what might be needed, and how these various entities that have responsibility can work together to provide the necessary capabilities--State, local, Federal, nonprofit, business sector, all of the different players. Ms. Norton. Mr. Becker, how do you receive the suggestions that maybe city employees could be equipped to step in until Red Cross came or to assist the Red Cross in large cities, for example, or perhaps elsewhere? Mr. Becker. Madam Chairwoman, we ask them to. That was our request of the city. I think what we have to be clear about is there are no- notice events, like earthquakes, where what we have there right then is all we have to respond with. And then, in the case of hurricanes, we can move thousands of people in before the storm hits, we can make sure we have all of our supplies. We were focused on the no-notice events, because I don't want to take 3 days to get thousands of people brought into San Francisco after an earthquake. I want to have a lot right there. Ms. Norton. So the city employees could be useful, is that what you are saying? Mr. Becker. That is who we are training to help work with the Red Cross and shelters. Ms. Norton. In how many cities is that happening? Mr. Becker. I would have to get you that information. But we have gone to multiple States and asked them to pass legislation to free their workers up to become Red Cross workers. Ms. Norton. I just think that is very important. When you talk about trouble in raising money and volunteers, I expect it to get worse, not better. You know what is on the Hill today and this week. So, as we think about where is the money, where are the people going to come from, I must say, Ms. Fagnoni's notion, which you now say is something that you have been doing, has legs, as far as I am concerned. Now, you say that each State would have to, of course, indicate that its employees, while still employed I take it, could assist in the shelters. And so far, LA and New York---- Mr. Becker. San Francisco. Ms. Norton. --have done that. It does seem to me that that is an idea that the Federal Government should encourage, because I don't know where more resources or more people are going to come from. Ms. Fagnoni, I am not sure what shelters you are talking about. You are talking about Red Cross shelters. Like, what is the Red Cross shelter in D.C.? Because, you know, there may be shelters that would not be, quote, "Red Cross shelters" that the city provides. So when you say the Red Cross doesn't have the ability to shelter, I am not sure what sheltering you are specifically referring to. Ms. Fagnoni. We used the available data we could get. And the data that were available--we used FEMA data for trying to estimate some of the need, and we used the Red Cross's own internal data, as Mr. Becker mentioned---- Ms. Norton. Mr. Becker, in a place like D.C., I don't know what she's calling a Red Cross shelter. Mr. Becker. Sure. Thank you for asking. We don't own any buildings---- Ms. Norton. That is right. So why is she assigning it to the Red Cross? Because there is a pre-existing agreement? Mr. Becker. Correct. We have 50,000 buildings in this country that we have inspected and put into a database and know the capacity of that are ready to be shelters. And the issue here is who declares a shelter. The local emergency manager declares a shelter. I can't take over a high school and say the gym is now a Red Cross shelter, but the local emergency manager can and does. So working within the county level or in the district level here, everyone knows what the buildings are that could be shelters. We have already identified them, we know where they are. Now, depending on the---- Ms. Norton. And so, are there lots of people running shelters besides the Red Cross? Mr. Becker. We are the primary shelter organization. Most communities turn sheltering over to the Red Cross. Most States turn sheltering over to the Red Cross. Ms. Norton. Where would they be in D.C.? Do you know off the top of your head? Is it the Armory? Mr. Becker. The Armory was one. That is where we put people during Katrina who came here. The Red Cross ran that shelter. Typically they are schools-- Ms. Norton. Well, if there was a catastrophic events--and she was addressing catastrophic events--many of these people might have need to go outside of the District. Perhaps you heard me give the Administrator 30 days to provide me with where residents in the District of Columbia, not part of a State, would go. Have you been involved with localities like the District, where people may not be able to be sheltered in the State, almost surely would not be sheltered within the State, and thus would find themselves on somebody else's territory? How would that work? Mr. Becker. We have modeled out, if we evacuated the District, where we think the people would go. Now, that is not a precise science, but we believe they would go to Maryland, Virginia, West Virginia and Delaware. Ms. Norton. Does Maryland, West Virginia and Delaware know that? Mr. Becker. I am sorry? Ms. Norton. Do Maryland, West Virginia, Virginia and Delaware know, "Here we come"? Mr. Becker. Yes, they do. Yes, they do. Ms. Norton. And they are prepared with shelters to receive residents of the District of Columbia? Mr. Becker. There are 1,821 shelters in those States that can handle 718,000 people. Ms. Norton. Now, they are prepared to receive out of State, and that is why, for example, Texas received people from Louisiana? Mr. Becker. Sure. The American Red Cross's job is to be on the receiving end and open up adequate shelters wherever the people evacuate to. So, during Gustav, we sheltered in 11 States. Ms. Norton. So, wait a minute. The pre-existing agreement that this is a Red Cross-designated shelter goes not only for residents of that State, but whoever may need to come to use a shelter in that State? Mr. Becker. One of the fundamental principals of the American Red Cross is that that shelter has to be open to anybody. Ms. Norton. This is very important for the residents of the District of Columbia who know there is not enough room here to hear. Well, Ms. Fagnoni, don't you think it was a little misleading to say that there are only 13,000 shelters available for the residents of the District of Columbia in a case of a mass casualty, since they would have been to evacuated almost surely to other States? Ms. Fagnoni. We were using the Red Cross's data, and, actually, those data do include the surrounding counties. Ms. Norton. 13,000? Ms. Fagnoni. Yes. Ms. Norton. Well, wait a minute. Because have you Mr. Becker right here. Now, Ms. Fagnoni now says the 13,000 that could be sheltered includes not only the District of Columbia but the, quote, "surrounding---- Mr. Becker. Counties. Ms. Fagnoni. Counties, right. Ms. Norton. Now, a mass shelter would mean perhaps as many as 150,000 people being evacuated. Where would they be sheltered? Mr. Becker. I would suggest that if the District evacuated in a terrorist incident, they are not all going to go to Fairfax County and Montgomery County. It is not just a very close-in evacuation. Experience shows us that people disperse over a multi-State area. When Katrina hit, the American Red Cross sheltered in 26 States. That is where the people went. Ms. Norton. So, Ms. Fagnoni, I understand why you looked at the--and I think a lot of people would head toward the nearest shelters. But I would hope--and that is what the Administrator is going to have to get me--that they would be directed, as they were in Katrina. Katrina didn't take everybody to the closest shelter; they took people all the way to Arkansas and to D.C. Mr. Becker. Right. Ms. Norton. So they would apparently have to be directed. And if there was the kind of planning that I think is necessary, they would have to be directed to shelters where there are places to go, so that you wouldn't crowd up on people who were closest here. I am just saying to GAO, you know, that could have raised alarms if we hear this, because the uninitiated think that that means there is no place else to go once you get past 13,000. You indicate, Mr. Becker, that there are capacity improvements. Ms. Fagnoni has noted that, since they were there, there have been some improvements. And you talk about-- you, after all, are quite decentralized organizations; that is why you are so valuable. Agreements signed with 150 organizations at the local level. Is it the local level, the national level? Mr. Becker. National level. Ms. Norton. It is the national level. Okay. Since everything depends upon what is on the ground, who monitors these agreements to assure that the capacity levels are kept current? Because, as you say, there could be unexpected events, and a terrorist event would be just that. Mr. Becker. Sure, it is one thing for us to have 150 national agreements. I would suggest the most important agreements we have are our local chapters with local organizations. And we have thousands of those, post-Katrina. The model here is we reach out to a church that might be in a difficult-to-serve part of the community or might speak a language we don't speak or more better represent the community. And we ask them long before the disaster, can we train you, can we give you our cots, can we give you our blankets and supplies? And what really gets their attention is we say, can we pay your bills if you are willing to become part of this community's disaster response? We don't ask them to become part of the Red Cross; we ask them to become part of the community's response. And those are the thousands of local arrangements that we have put in place. When Gustav hit Louisiana, we sheltered about 18,000 people in Louisiana on the second night, and a fourth of those shelters were those partner shelters. They weren't all run by the American Red Cross. That was a good thing. We wanted---- Ms. Norton. Do you think that shelter in northern Louisiana that a thousand poor people were shipped to was run by the Red Cross? Mr. Becker. No, ma'am. That shelter was part of the evacuation strategy for the people who left New Orleans on buses, that, as the Admiral said, was controlled by the State. And the State chose to operate the shelters on the receiving end of the buses. So the State---- Ms. Norton. Probably because there wasn't any Red Cross shelter they could go to at that point? Mr. Becker. I would suggest to you that if you look at the State of Louisiana, there are buildings that could handle 67,000 people. Ms. Norton. That could handle 6,000 or 7,000 people? Mr. Becker. In Louisiana, 67,000, almost 70,000. And we only had 18,000 people in our shelters the second night of Gustav. We had excess shelter capacity in Louisiana when Gustav hit, but part of the plan for the bus evacuation--the State was very concerned that they would know where the buses were going, and they wanted to be the ones on the receiving end to take care of them. And, frankly, Madam Chairwoman, made several attempts to offer our support for those shelters after the first night. Ms. Norton. Well, wait a minute. You were on the receiving end. You are the service deliverer that Louisiana and everybody else is most accustomed to. Why did they decide to bypass the Red Cross shelters and go to a warehouse with a thousand people with no place to bathe and no privacy? Why would they have done that if you offered them shelters? Mr. Becker. There was a concern the storm was coming in on such a level--I mean, remember, it was a Category 4. Ms. Norton. Were you too near the storm? Mr. Becker. No. The issue was we all thought that we were going to fill our shelters up in Louisiana. That was a very distinct possibility. We did it during Katrina, and that we would be sheltering further away. And so the State made the decision to add shelters for the people who were bussed and that they would operate those shelters. Ms. Norton. I see. So it was anticipated that you would have people coming to your shelters, and that did not occur. Mr. Becker. Everybody who got in a car and evacuated themselves went to Red Cross shelters. What the State opened up were several buildings---- Ms. Norton. But you were under capacity in the Red Cross shelter. If everybody went to the Red Cross shelter and you were under capacity, they thought that those shelters would be full? I see. Mr. Becker. We were planning on the worst. You have to plan for the worst---- Ms. Norton. I see. Mr. Becker. --and we were all pleasantly surprised. Ms. Norton. I see. Let me ask Ms. Fagnoni, we know that your report was in before Ike and Gustav, but if you look at Galveston, fairly catastrophic. We have seen problems with government, FEMA for example, getting supplies there. But when it came to distribution of supplies, the Red Cross is also involved in the point-of-delivery distribution with prepositioning of supplies. Is it your view that where the Red Cross has prepositioned supplies, I guess it is their responsibility to then get the supplies to their centers, that in a mass casualty they would have difficulty doing that? Ms. Fagnoni. You are right, we didn't look specifically at Gustav for our report. But we do talk about some of the actions that the voluntary organizations have taken since Katrina to try to better deal with some of the logistical issues that came up. And, actually, I know the Red Cross and the Southern Baptist Convention tend to work together a lot, in terms of supply chains and prepositioning. And a number of these voluntary organizations have started prepositioning more supplies, putting global positioning systems in their equipment and things like that. So, in a general sense, they are trying to be responsive. But the scenario and to what extent the Red Cross is working in conjunction with others I think would depend on the specific scenario. They may or may not only be managing their own resources, they may also be working in conjunction with other voluntary organizations. Ms. Norton. Yes, Mr. Becker, did you want to respond to that? Mr. Becker. Thank you very much. The points of distribution that you heard the Admiral refer to and where we had some issues, those are different supplies. That is ice and water, which FEMA, through the Army Corps of Engineers, prepositions into a community to support people post-disaster. We don't typically receive our supplies from government. When we feed people, we buy that food or we get it donated. When we distribute rakes and shovels and clean-up kits and toiletry kits, we buy those or we get those donated. We don't receive those from government. Sometimes on those PODs, or points of distribution, you will see Red Cross workers there, our volunteers, because there is just not enough people to hand things out, so we will give volunteers to local government. But those PODs are giving away ice and water and MREs from the military, frankly. That is a different supply chain than what we use to feed community, to shelter people, to distribute in communities. Ms. Norton. Well, I am sure Ms. Fagnoni would agree that the country regards the Red Cross as heroic in times of disaster. We don't, by any means, assign to you all the mass care responsibility. After Katrina, we know that much of that responsibility would be beyond anybody, except the government, to help take care of. Indeed, Mr. Becker, you say that even with Gustav and Ike, Louisiana thought it would have to set up its own facility. And look what it did. It shows you that, when you are armatures at it, as the State clearly was if they put a thousand people in a warehouse with no bathing facilities, you are not likely to do it very well. So we are very, very concerned that the Red Cross continue to work closely. We understand the funding difficulty. You have heard me ask those questions. This is not an appropriation hearing. We are trying to find out how it works, following the GAO report. We recognize that the Red Cross is being put in an untenable position, but we think so is government. And one of the things we are going to have to figure out, as we become overwhelmed, is how to make sure the Red Cross, who has been doing it virtually by themselves as an agent of the government, but with volunteers, with donations, we are going to have to ask ourselves some tough questions, whether or not we can expect you to continue to do what you do. Yes, there is some Federal funding for certain kinds of missions, but we are going to have some tough questions to ask ourselves, particularly before any catastrophe strikes of the kind that is now unexpected. Your testimony, both the GAO report, has been helpful to us. I am sure it will be to Mr. Becker. And, certainly, Mr. Becker, the Red Cross is continuing activities essential to the United States of America. We want to thank you for it. We will continue to work with you. And your testimony has made us understand, as has the GAO report, how we as a Subcommittee have to proceed in order to make sure that FEMA works closely, even more closely, with the Red Cross to maximize its internal capacities and responsibilities. You have had your own problems. I am not going to ask you about your turnover and presidents and the like. Because it looks like when you get a problem, you try to then go to the next step and get a new manager. As long as you do that and you continue to do the kind of work you have been doing on the ground, all we can do is thank you. I thank both of you for very helpful testimony. Ms. Fagnoni. Thank you. Mr. Becker. Thank you. Ms. Norton. And this hearing is adjourned. [Whereupon, at 5:00 p.m., the Subcommittee was adjourned.] [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]