FEDERAL EMERGENCY MANAGEMENT AGENCY
SENATE COMMITTEE ON ENVIRONMENT AND PUBLIC WORKS
NOVEMBER 1, 2001
Good afternoon, Chairman Jeffords and Committee members. I am Michael D. Brown, the General Counsel and Acting Deputy Director of the Federal Emergency Management Agency (FEMA), and I am pleased to testify today about several draft bills that are being considered in the aftermath of the World Trade Center attack.
One bill would require the Director of FEMA, in coordination with the Federal Communications Commission and the Department of Defense, to conduct a study to determine the resources that are needed to develop an effective communications system for the use of emergency response personnel during disasters. We have no objection to the concept of performing such a study, but note that allocating resources to this effort would have an impact on our operating budget.
Another bill under consideration would establish within FEMA an Office of World Trade Center Attack Claims to reimburse individuals and businesses that were injured by the World Trade Center attack on September 11.
Several other bills under consideration would amend the Stafford Act to: 1) authorize the President to conduct studies relating to protection of the health and safety of emergency responders in the aftermath of disasters where harmful substances have been released into the disaster area; 2) direct the President to appoint Children’s Coordinating Officers following disasters where children have lost one or more custodial parents; and 3) extend from 26 weeks to a year the availability of disaster unemployment assistance for individuals who are already eligible for this assistance under the Stafford Act. In addition, FEMA was asked informally to address whether there is a need for new legislation involving housing repairs relating to the September 11 attack.
The draft legislation to establish a World Trade Center claims office within FEMA would require the Director of FEMA or an independent claims manager who would be appointed by the Director to reimburse claimants, including individuals and businesses that live or maintain businesses in the area around the attack site, for losses suffered as a result of the World Trade Center attack. The bill indicates that claimants could file claims for a variety of different losses, including property losses, infrastructure damage, business interruption losses, wages for work not performed, insurance deductibles, temporary living or relocation expenses, and debris removal costs. The bill also requires FEMA to deduct from any claim payments the amounts that claimants received from insurance recoveries and disaster assistance payments provided by FEMA, other Federal agencies, State or local governments, charities, or non-profit organizations. Initially $2 billion would be authorized to be appropriated to implement the legislation - $1,925,000,000 to pay claims, and $75,000,000 to cover the costs of administering the program.
As you are aware, the Stafford Act already contains a broad range of authorities that were triggered by the President’s major disaster declaration. We have provided temporary housing assistance to address the housing-related needs of victims of the attacks. FEMA is also providing funding to cover 100% of the costs of performing debris removal at the site of the attack. In addition, we are providing assistance to repair and replace all publicly-owned and certain nonprofit facilities that were damaged or destroyed by the attack.
Nevertheless, it is clear that the draft legislation would cover a substantially broader range of injuries and losses than FEMA is authorized to address under the Stafford Act. For example, the Stafford Act does not authorize FEMA to reimburse disaster victims for business interruption losses, wages for work not performed, and business relocation expenses. In addition, the Stafford Act only authorizes FEMA to provide assistance to eligible applicants, such as State and local governments and a limited number of nonprofit organizations. The draft legislation, on the other hand, would require FEMA to pay claims that might be submitted by virtually all individuals and businesses that were injured by the attack.
As you know, Congress recently enacted the Air Transportation Safety and System Stabilization Act. Title IV of that Act authorizes the Justice Department to provide compensation to any person, or relatives of a deceased person, who was injured or killed in the September 11 airplane crashes. Although the draft legislation that would create a claims office within FEMA would provide assistance to a broader range of claimants than is covered by the Air Transportation Safety and System Stabilization Act, we question whether this is an appropriate role for FEMA.
While Justice is still developing the regulations of this program, FEMA is already addressing a substantial percentage of the needs of individuals who were injured by the attack at the World Trade Center pursuant to the authorities of the Stafford Act. On the other hand, our preliminary review of the draft legislation suggests that most of the claims that would be paid pursuant to the bill would flow to businesses that were damaged by the attack and that agree to re-establish their business activities in the area affected by the attack.
FEMA believes that there are already authorities administered by the Small Business Administration (SBA) that would cover many of the types of losses that the bill would require FEMA to address. While I recognize that there are caps on the disaster assistance loans that SBA is currently authorized to provide, and while I also recognize that affected businesses would prefer to have access to Federal grants, rather than loans, we believe it would be preferable to consider legislation in this situation that would authorize additional flexibility for existing Federal programs.
Another one of the bills that I was asked to address would amend the Stafford Act to authorize the President to appoint Children’s Coordinating Officers whenever an emergency or major disaster caused children to lose one or more custodial parents. The Coordinating Officers would be responsible for providing support and assistance to such children to ensure that they were provided with adequate temporary care services, mental health services, and counseling to address their long-term needs. As you know, FEMA is already authorized to provide crisis counseling assistance to disaster victims. We administer this authority by funding States’s costs of administering counseling services. State applications for crisis counseling funds must address how services will be provided generally, and in particular to special populations, such as children.
New York’s application already addresses the need to provide counseling services to children who have been affected by the attack. According to the New York Office of Mental Health, these activities are being provided through outreach programs, education, and other existing services to children who lost a parent in the attack. We are not aware that this has become an issue which needs to be addressed by amending the Stafford Act, but we would welcome the opportunity to discuss this issue with Committee members, as well as representatives of the State, New York City, and counseling providers to ensure that appropriate counseling and long-term services are available to all needy children. Additional needs in this regard would probably best be addressed by agencies with a traditional role in the provision of such services.
I was also asked to address a draft bill that would amend section 410 of the Stafford Act to extend the availability of Disaster Unemployment Assistance (DUA) an additional 26 weeks – to a full year – for individuals who are already eligible for such assistance. As you may be aware, the DUA program is administered on our behalf by the Department of Labor, the federal partner in the federal-state unemployment compensation system. The Department of Labor enters into agreements with the states to administer the DUA program through the state unemployment compensation systems. Most workers who become unemployed as a result of Presidentially-declared disasters qualify for unemployment compensation under the regular state programs. Those who do not may qualify for DUA.
The unemployment claims that have been filed in the aftermath of the attack are, therefore, being paid under state unemployment compensation laws and under the DUA provision of the Stafford Act. The Administration has proposed, as part of the Back-to-Work Relief package which has been introduced in the Senate by Senator Allen as S. 1532, to extend unemployment compensation for an additional 13 weeks for individuals who became unemployed on or after September 11 in States where a major disaster or emergency was declared as a result of the attacks and in States where the unemployment rate increases by 30 percent over the pre-September 11 rate. In addition, in light of the uniqueness of this situation, the Administration would support an additional 13 weeks of disaster unemployment assistance in those States where a major disaster was declared due to the September 11 events.
The final draft bill that I was asked to address in this hearing would amend the Stafford Act to authorize the President to implement a program to protect the health and safety of emergency response personnel in the aftermath of disasters which cause harmful substances to be released. The program would authorize: 1) the provision to community members and emergency response personnel, including volunteers, of information about harmful substances; 2) monitoring of the long-term health impacts of harmful substances; and 3) training in the use of personal protective equipment for emergency response personnel. FEMA routinely calls on the Environmental Protection Agency and the Department of Health and Human Services for expertise in assessing these types of concerns in the aftermath of disasters. This system has worked efficiently, and we therefore are not aware of a need to amend the Stafford Act to address this issue. However, this is an important issue that may require more time for review within the Administration.
Finally, the Committee letter mentions a need to amend the Stafford Act’s temporary housing authority to increase the amount of funding that may be provided to repair owner-occupied housing that is damaged by major disasters. There is a new provision of the Stafford Act that will become effective next May that would impose a $5,000 cap on this form of temporary housing assistance. In previous correspondence we have asked the Committee to amend this provision, which, when it becomes effective in May of 2002, will work a severe hardship on disaster victims with the lowest incomes and the most significant disaster impacts. This cap was enacted within Public Law 106-390. While the cap does not affect the response in New York, we continue to urge the Committee to make this technical amendment before the cap takes effect next May.
Thank you for this opportunity to testify before you today. I would be pleased to answer any questions you might have.