Skip to main content

tv   Key Capitol Hill Hearings  CSPAN  November 6, 2013 2:00pm-4:01pm EST

2:00 pm
i'm guessing on that one. they also have offices in virginia. we are working with both the national and local. >> i also serve on the finance committee, and in the finance committee, cms testified on doing the testing on this website. we were assured that it had all been done. it is my understanding there was testing still going on the day before the website opened and that there had not been the security testing that either was called for or was not called for. how much security testing was done as part of the data testing? >> this is what i was trying to explain earlier. there are two components to the federal exchange. one is the hub, and that was completely tested, security testing, signed off, and in the
2:01 pm
case of the ffm, or the actual exchange itself, each component was tested by us independently come a verified, security tested, and it was not signed off in a complete package, so we signed a short-term authorization to operate, which would be customary if you were continuing to do work on the project. >> you also mention this information that goes in there is just pinged in there and not stored. how do you identify the person later if there is not any of that information kept? >> the social security number is not stored in the data hub. when you have completed an application, it has this information, and an individual can store that online. that is part of the proofing that an individual can do to
2:02 pm
store their application. we also have some storage in what i will call the enrollment eligibility in case there is an appeal. what i was trying to say there's no data stored in the hub. we have information on record. >> i do not think people are cared where it is stored. they care about their privacy. my time is almost up. thank you. >> thank you, senator enzi. senator bennet? >> thank you, mr. chairman. thank you for being here today. as i watch this approach to local and state and government here, i hope as we go forward we do not lose sight of the fact that government does not do a great job with procurement, with i.t., or with customer service, and we're seeing that in spades.
2:03 pm
i hope is we use this as an occasion not just a point fingers, but how to improve things for the people going forward. i think that customer service element is an enormously important so we do not face the crisis of confidence senator mikulski talked about. that should be job number one, to figure out that people -- but the politics aside. whether people sitting at their kitchen table can decide and evaluate for themselves whether this is a better deal or not for them. in colorado, as you know, we set up our own exchange. one of the things i have been told is that people have to go through 20 pages to have a determination made about the medicaid eligibility before they can actually get access to the private marketplace. and there has been some suggestion that that has been required by the federal government. i don't know whether that is true or not, but i wonder whether you can enlighten me on that or shed some light on it
2:04 pm
and whether we can figure out how to work together to make that less of a burden to people. he cause it seems to me that customer service friendly website would say -- if you think you might be eligible for medicaid, click here. take me through that. but for somebody he knows they are not eligible, to skip the 20 pages, means they get to the private exchange. >> so, i think -- >> i am sorry, as you talk about that, can you broadly address the question of customer service part of this? the changes that you have made to try to give people the opportunity on the federal exchange to make their own decision. >> let me start by saying, it is a common application, whether you are going on to shop without a subsidy or to see if you qualify for a subsidy or for medicaid. and i think that is what you are referring to, the common application. but whether you are medicaid
2:05 pm
eligible or whether you are applying for subsidies, it is a single application. so, medicaid doesn't add any additional steps to that process. >> my understanding -- and again, this is the colorado exchange and not the federal. my understanding is a you need to be denied by medicaid before you can have access to shop in the private marketplace. >> so, i would need to check with colorado. >> let's do that. can we do that today? >> yes. the customer service issue is very important to us. as we stabilize the site, we will go back and deal with those individuals that we think may have had a bad experience am a such as a establishment of an e- mail account. we have individuals' in the -- information so we will reach out and invite them to come back. some may have gone ahead and created a separate account or
2:06 pm
maybe they were just on their out of curiosity. but at least we will make an effort to go back and get in touch with individuals and say if you had trouble in the first week am a leave, come back and try to establish your account again, because we solved the problem. that is the first step. the second step is how we handle it in the media and the market. so, we do have -- what i was talking about before -- a campaign to reach out to consumers, but we will not start us -- campaign until we stabilize the site the next few weeks. december, january, february, march, reaching out to individuals. if you are on a state-based exchange, they are responsible. if you are on a federal exchange, we have that opportunity. so, we identified key markets based on the number of young uninsured, the number of uninsured in general and the population. so, we do have a targeted campaign for the next four months. >> what are the implications for
2:07 pm
your timelines with respect to eligibility, sign up, and all the rest? if you don't get the website fully functional by the end of the month -- or by the end -- >> november. based on our analysis we will have it fully functioning by the end of november. there will always be people who don't want to use the website, who want to do paper, who want to call in. that is fine. we will support that. but i think we always assumed that, based on massachusetts' experience, the initial sign up will be very slow. and in fact, no payments have to be made until december 15 for coverage on january 1. so, while we don't like the problems we had in october and fixing it in november, we do not think it will impact the timeline because we have a six- month enrollment, so we still have four months left and individuals can apply up until march. >> thank you. thank you, mr. chairman.
2:08 pm
>> now to senator robert. -- senator roberts. senator robert? >> thank you, mr. chairman. i'm going to focus, if i can, on the concerns raised by senator isakson, alexander, and the chairman, on security and privacy. we have a law, the federal information security management act, his mother f --isma. everything has to have an acronym. it requires each agency to a point a chief security officer to ensure americans private financial and identifying information is protected. and that is a big issue. secretary civilians revealed last week exchanges operating on temporary authority to operate. there is a 2012 memo from
2:09 pm
jeffrey zyonts, the man appointed to fix the affordable care act. as head of omb he stated clearly omb does not recognize interim authority to operate for security authorizations. i first question is, why was the exchange allowed to go operational without the apparent parents required by the office of management and budget? i am going to go on -- just think about any minute. i don't like to do this, but time is limited. again, as part of the fisma assessment, an independent testing organization must perform a risk analysis of the security of the system. so, my second question -- did an independent testing organization ever test the whole integrated system end to end? i am sorry to ask you to bank questions. >> that's all right. the first question -- omb does approve of short-term
2:10 pm
authorization. so, we are following rules outlined by omb, and i double checked that. the second one is -- yes, we are fisma and nist compliant and we did use an independent security firm that did the work in testing. the only piece that was not -- what i talked about before, we could not test and a live environment until october 1. because the testing will continue this month and next month as we do the software upgrades, and it will be tested in a live environment. >> without revealing publicly -- which obviously you cannot do -- will use them in confidentially the results of the independent testing? >> i will submit everything i can within the security guidelines. yes, sir. >> all right. a september 27 memo addressed to you state that due to system readiness issues, the required
2:11 pm
security assessment was only partly completed. the memo notes that untested parts of the system pose a high security risk and the contractor was not able to test all parts of the system in one complete version of the system. i have here a cbs news analysis that i would like to include in the record. that found that the deadline for final security land slipped three times from may 6 until july 16, security assessment to be completed in june was lit to august. the required top to bottom security test never got done. agency head marylin tavenner, according to this analysis, accepted the risk and mitigation measures like frequent testing and dedicated security team -- but three other officials signed a statement saying that it does not reduce the risk of launching as of october 1. that september 27 memo
2:12 pm
recommends a mitigation plan to address these risks and recommends a six-month authority to operate. that recommendation was signed by you. are you the official as cms responsible for making the security authorization decisions? >> i think in the case, because of the visibility of the exchange, the chief information officer wanted to make me aware of it, and i agreed to sign it with their recommendation to proceed. >> does anybody else approve that decision before it is final? >> no, sir. >> like secretary civilians? >> and no, sir, it is my decision. >> i appreciate that. thank you very much. >> i will take the remaining 30 seconds of the senators time and just say, again, i think -- as i talked to my fellow senators on both sides of the aisle, this is a paramount concern. consumers have to be absolutely certain that when they go on and fill out the application and give all of that information,
2:13 pm
that at a secure, that no one can hack into that and steal social security numbers or identity and other things. i just think this is an issue that really has to be focused on thoroughly so that there is absolute assurance that that is secured. thank you. >> mr. chairman, can i get my 30 seconds back? >> you give it up already. >> you took it. i sort of given up. i just want to reflect on what you said, sir. there is a lady named margaret from kansas who i promised i would bring this issue up. she tried to get on the exchange and then she tried to call the number about 3, 6, 7, 8 times. finally got somebody and she said if i selected that plan, would it be secure? the answer was -- well, you know, pretty sure.
2:14 pm
that is a direct quote. she said, if you are pretty sure, i want to be sure. she hung up and call the office. that is an example a concern. >> appreciate that. i do share the concern. senator baldwin? >> thank you, mr. chairman. i want to thank you and the ranking member for convening us today, and administrator tavenner, thank you for being here. chairman, i appreciated your opening remarks and setting a context for where we are with real and significant challenges. but also a story of the earlier implementation of the affordable care act that has proven to help very many. i think about the parents of children with pre-existing health conditions who can now secure insurance for their children, and the peace of mind that for wide. i think about the 6.6 million
2:15 pm
young adults covered on their parents' health insurance and i take personal pride on that because i worked on that amendment as a house member as we were marking the bill up in energy and commerce. i think about the $6 billion in prescription drug savings that seniors have the advantage of since the passage of this bill. and then i think about the rough implementation of this next phase of the affordable care act. and even with the significant technical issues around the website,, i have heard from families in wisconsin that are already recognizing some of the new insurance options that are available. as you said in context of your
2:16 pm
opening remarks, that is what this is about. and new marketplace especially for those who are shut out. i heard from karl and bonnie who own a farm in hayward, wisconsin, in the north woods of our state. they shared about their struggle to find health insurance prior to the passage of the affordable care act. they were both dropped from their plan after health tests showed karl was at risk of prostate cancer. they had to buy a new plan. they were lucky they could find one. that had a $10,000 deductible and $800 premium, but it had a rider that said it would not cover prostate cancer if karl ever got sick. due to the affordable care act, they are not comparing and shopping for new coverage in the marketplace. he contacted me to share that they are thankful and very excited to be able to find health care plans that are not only affordable but actually cover cancer. given the quality health insurance options available in
2:17 pm
the marketplace, we need all of the doors to that marketplace to be wide open. and the ongoing technical problems are unacceptable and they must be fixed as soon as possible. and i am glad to hear your update on the progress. they should have been fixed yesterday. but the need for a well functioning is particularly acute in a state like the one i represent. because our governor chose not to build a wisconsin-made state- based arco place for individuals and small businesses. he also failed to seize the opportunity that the affordable care act presented to strengthen
2:18 pm
what we call badger care in wisconsin. when he decided not to expand medicaid under the affordable care act. instead, governor walker decided to kick off as many as what we think would be around 90 -- 90,000-92,000 off their current medicaid coverage. i think of our discussion about, if you like your health care plan, you can keep it. well, there's tens of thousands of wisconsinites who like their badger care and the reason why they can't keep it is because of our governor's decision. i wanted to ask you, administrator tavenner, to start off, can you confirm that wisconsin is one of the only states in the nation poised to kick off a large number of individuals from the current medicaid coverage in 2014? >> senator baldwin -- right now, and we are in discussion with the wisconsin.
2:19 pm
they and maine are the two states of looking at this idea. other states have talked about it, but these are the two who put the proposals forward. you are right, 92,000 people. and we are working with wisconsin, are medicaid and -- to make sure those individuals are aware of the marketplace. >> i want to ask you a little bit more about that. this is a significant number of people in my state. and in order to avoid a lapse in coverage, individuals losing badger care must enroll by december 15 -- >> i am sorry, the senators time i am trying to hold to five minutes. everybody has been very good about this. senator scott? >> i want her to continue to
2:20 pm
talk so i would have more time. >> no, we are tied to keep it at five that you will get a second round. >> republican jokes are not funny. i apologize. thank you, mr. chairman. [laughter] >> southern drawl. let's get back to the topic. ms. tavenner, thank you very much for being here. we are more than 30 days -- from one of the greatest website disasters in history. after nearly 400 million dollars is synonymous with failure. the public's trust has been broken in the report i am hearing reinforces why. one in particular we have already heard discussion on -- the south carolina man, it is so painful, that i want to dedicate my time in question to try to resolve his issues. the case starts with justin from north carolina attempting on october 1 to get obamacare through the health by halloween, just four or five days ago, he was still unable to sign up for obamacare. however, mr. hadley from north
2:21 pm
carolina immediately saw two download links. an eligibility notice from mr. dougal from south carolina, including his name, address, and eligibility for subsidies. the google -- mr.dougal is requesting the personal information from all of his family be removed from because he cannot remove it himself because there is nodelte option for consumers. of course now mr. dougal nor mr. hatley will use the website to purchase insurance. making matters worse, when my office was contacted with assistance we called the help there -- one 800 number and asked a specific question -- can you remove mr. dougal's personal information? the response was silence. not a yes, not a no, not a maybe, not let me check with my supervisor. they just simply refused to have an audible word in response to
2:22 pm
our question. it is hard to believe that your account managers really do not know if they can delete accounts internally, especially after such an egregious breach of trust. by the way, mr. dougal has called on several occasions but no one will call him back. not a single person has taken the time, after having his information exposed, to even call mr. dougal back. i tell you this story because it illustrates what happen as a result of incompetence with this website and this program. the administration and hhs new that americans' personal information was at risk before the website went up. i think senator roberts just spoke about the and dr. general's report from august that warmth that obamacare's exchanges may end up here
2:23 pm
legally exposing americans' private records to hackers and criminals. the report noted cms is working with a very tight deadline to ensure that security measures for the hub are set, tested, and implement it. further, senator roberts alluded to an internal memo from september 27 of detained by "the washington post" and to quote the memo, it says inherent security risks exposes the level of uncertainty that can be deemed as a high risk to personal financial information being exposed. the memo, -- and you have taken responsibility, and we appreciate that -- was written specifically to you from your administrator of health plan operations and deputy cio. you signed up and ready for to operate for six months with a mitigation plan to be implemented. in other words, you authorized to go forward realizing that the potential of exposing personal information was, and i quote from the memo,
2:24 pm
at high risk. my questions -- do you believe that six months is an acceptable amount of time for this website to operate in a manner that puts americans' financial information at risk for high risk of security breach? hasn't happened before? can you guarantee social security numbers are secure? will you shut down the website as my friends from them left have already suggested -- until security issues are fixed? i would also like to finish by asking that we get mr. dougal and answer in deleting the information from the system and we get the answer today, if possible. i have a copy of the letter he is we question -- he is requesting. we can bring the information over to your staffer as well. i certainly realize at the beginning of the testimony, the answer was given that the software fix has happened on the information, but the software fix was simply to disable the links, so when mr. hadley goes to the website, he still sees the link but he cannot click the link. so, the guarantee and the clarification that simply tells mr.dougal that he has complete
2:25 pm
confidence his information has been deleted from the system has yet not been achieved. >> first of all, senator scott, we have reached out to mr. dougal several times a week will follow. >> i am happy to give you numbers. he does not think so, actually, because no one has called him. >> we have a disagreement there. >> yes, ma'am. >> the second question -- the hub --i keep trying to separate the two because they are two different systems. the hub was separately tested all the way through and there was a signoff from the chief information office. we should put that aside. what we are talking about is the ffm, the exchange peace, and that is the part i described herein in a six-month period, let me tell you what is going on. there is a dedicated security team working under the chief information officer. we do weekly testing of all
2:26 pm
devices, including internet facing web service, daily and weekly, 24/seven, continuous scans. we will have a full -- a stable environment with all security and controls on the software upgrade is done, and that is standard operating procedure. that will be within 60-90 days of us going live october 1. >> my time is up. thank you very much for your answer. i was only suggesting whether the hub or other entity, that i think the consumer sees is not what is going wrong, is that their confidence is going down, and we want to make sure we alert y'all to the fact that any aspect is of not work them the confidence is gone. but thank you, senator. -- >> senator god, i would like also if you could make -- senator scott, i would like also for you to make that information available to the --
2:27 pm
>> welcome, mrs. tavenner. i would concede that when you reorder 16 of the american economy there will be some people who are unhappy -- 1/6 of the american economy there will be some people are unhappy. and when you stand up a brand- new mechanism to give 30 million people access to health care that they did not have, that there would also be some people who are unhappy with their experience. and i think at some level, this should be an exercise in setting the right expectations. that when you undergo this kind of effort to reorder a health- care system that everyone on this committee agrees is broken, there are going to be some people who win and some will lose, and frankly, under any reform plan that has been debated in the last 20 years, that is true.
2:28 pm
what we are suggesting is that there are going to be far more people over the course of the rollout of this legislation who have a better experience than what is happening currently in the system the band have a worse experience. while it is always risky to legislate by anecdote, we are telling stories here today, so let me just add one to the mix. betty berger from connecticut. betty and her family had insurance. her husband switched jobs and during the several week period in between his first job and his second job, their son was diagnosed with cancer. guess what? his new employer would not pick up coverage for the son. betty's story is one that can be repeated 2 million times every single year across the country. they went bankrupt. they lost their house. they lost their car. they lost their savings simply because their son had the misfortune of being diagnosed during a two-week period in which they did not have insurance.
2:29 pm
their problem was not that they got dropped from coverage, their problem is they could not find any coverage, and the story can be told millions of times over. and i guess my confidence that in the end --while this is a disruption to a large section of the economy, my confidence that in the end there are going to be far, far more winners than losers, is rooted in part in connecticut by shakespeare and. we have an exchange that is up and working. in the first month of the exchange, we have hit 10% of our overall enrollment goal, even given the fact that the massachusetts connector, who is run by the same guy who was running connecticut's exchange in the first month only so 0.3% of total enrollment sign-up. so, i have confident that the rocket will fly off the shelves once people can get into the website -- this product will fly off of the sale -- shelves once people can get into the website because what we have seen in
2:30 pm
connecticut and also i am optimistic that once his site is up it will be up in time for the largest number of people to enroll, because what you said in response to senator bennet's questions, the reality is that the vast majority of people are going to be looking for coverage as the enrollment date draws near. so, i guess that is the frame of my question to you. from the experience of people who have been able to access these exchanges -- either at the national level or state level -- what do we know about the quality of the product and, two, what do we know about the timing of when people actually sign up for plans like this? we have the massachusetts experience, the experience of medicare part d. to the extent your timeline plays out and we have a fully functioning website within the next dirty-60 days, is that in time for what we expect to be the majority of people coming in and wanting to access the product?
2:31 pm
what the senate homeland security subcommittee on emergency management convenes this hearing, looking at gaps on long-term recovery and building communities. the beauty mayor for operations for new york -- the deputy mayor for operations in new york will also testify.
2:32 pm
2:33 pm
x thank you for being patient. we are waiting just a couple of more minutes and then we will start. i thank you all for being here, just hang tight.
2:34 pm
2:35 pm
>> welcome to the subcommittee in thegency management district of columbia. we thank you all for being here. we are here today to examine the east onein the north year after hurricane sandy came to shore on october 29, 2012. as we mark this solemn anniversary we owe it to ourselves and to those who were lost a year ago to continue to learn from sandy, to improve disastrous response and recovery across the country. as we all know, the next big disaster can happen at anytime, anywhere. my home state of alaska, we have our fair share of disasters from the gulf, from the alaska
2:36 pm
earthquake to the oil spill. we saw a along the yukon river. the ongoing recovery is a testament in the same type of federal, state, and local coronation that was so crucial to the months following hurricane sandy. as cochair of the national preparedness month, which wrapped up at the end of september, i believe it is also important to remember that individuals play a large role in preparing their communities for disasters. following sandy we saw citizens from around the country donating their time, money, resources, and expertise to help the affected area. nonprofit organizations like the red cross mobilized volunteers and leverage nongovernmental resources. it is in this whole community response that proves to be the best practice in large disasters. alaskan state care -- alaskans take care of our neighbors.
2:37 pm
we understand that the interconnected infrastructure is both this countries to get asset and our biggest vulnerability. anddisasters begin locally their effects can reach beyond established geographic boundaries. one of the most critical aspects of the recovery process following a disaster is learning from mistakes and integrating those lessons learned. since hurricane katrina, fema has worked with other members of the federal family to institutionalize recovery reforms. the agency has released the national disaster recovery framework just last year and it is already in used in states across the country, including my home state of alaska. all agencies were presented here today have illustrated a fierce anditment to response recovery. i applaud their efforts but we can do better. our responsibility of an oversight committee is to make sure we do better. leave we require
2:38 pm
oversight is the financial management of the sandy supplemental funding. approved $50 billion to aid with response to recovery by 19s, being performed federal agencies. assuring this money is spent in a timely fashion is critical. as we know there are many communities and individuals still in need over a year from the storm. we also must assure that at -- that taxpayer dollars are being spent wisely. federal agencies must be accountable for their expenditures and must be prepared to communicate exactly how these funds are being used. don't advocate for burdensome reporting requirements the slowdown recovery. controls exist to protect our national investment. must assure that laws and regulation, mitigation, and response -- this must be the top priority. i look forward to hearing the
2:39 pm
testimony from today. we are doing something a little different. we will have senator paul interrupt the flow, allowing him his opening statement. we have invited members who are not members of the committee to also artistic pay. having senator landry here, who was affected by katrina in her community -- i have asked members to make sure that -- we will have your full statements in the record and then a reminder that we want to hear from any of our folks here to testify. i will do an order of appearance. >> thank you, mr. chairman. i am going to leave my comment weekly, submit my full statement to the record, and honor the delegation from the northeast that is here. the work of senator menendez angela brand was essential to this recovery effort. of course, welcome senator .rooker to the committee
2:40 pm
the former mayoral write-in the middle of the storm as it occurs -- i'm sure you can bring expertise to the senate and this committee as we struggle to build a better response to disasters of all sorts, man-made or natural. medium, and catastrophic, which was clearly the case of katrina and came very close in sandy. we have a long way to go. but i appreciate the work of this special subcommittee. it is what mayors and county commissioners and chambers of commerce and individual families and consumers and residents -- the citizens count on us to do our best work. in times of disaster they know their government will be there for them and helping them to recover. i will submit my full statement to the record but really think the northeast delegation for their extraordinary work in recovery. we managed to get a little bit of money out of the bill in
2:41 pm
louisiana to keep going with our ongoing permanent recovery of the many storms that hit our state. very much.u senator paul does not have an opening statement but i thank him for attending and being part of this. he is the ranking member and it is important we continue to analyze all of these issues related to the emergency response of our country. senator brooker is next great he is so new that you can tell by his sign plate. or he just brought his own as a former mayor. senator menendez, you were not supposed to say that. we wanted him to learn that process. i will start with you and go to senator menendez. --first of all [indiscernible] not only to i appreciate the opportunity to participate, but
2:42 pm
this is clearly my first hearing as a senator. it could not be more according to the people of my state. that's more important to the people of my state. i want to thank those testifying, including secretary donovan, who has been a partner with me on many issues. i look for to working with him even closer now. i look forward to hearing what he has to say as well as those others who are testifying today, especially mr. few gate -- mr. fugate. in the aftermath of hurricane sandy, many people in this room played such critical roles, holding all table hearings and advocating for robust federal ensure that new jersey, new york, and although states affected had the resources and support they needed. on behalf of the people of new jersey i think everyone for their leadership and for your recognition that much urgent work had to be done. i want to especially acknowledge
2:43 pm
my senior senator, senator menendez. he is a true champion of our .tate as a mayor who had significant impact and loss of life, he was a champion of the whole state and every community that was suffering. from day one you are crisscrossing the state, ship shepherding -- shepherding desperate resources to new jersey. there's no denying the process we have made -- the progress we have made. low-interest loans, national flood insurance program payments and public assistance grants. in new jersey we are resilient, we are determined, and we are incredibly resourceful. our famous boardwalks have welcomed families and tourists to the jersey shore. hoboken, atlanta city, and newark are bustling
2:44 pm
with activity. emily's and business people continue to pick up the pieces and move forward. still, far too many are recovering and it is challenging. it is a daily struggle. from a little fairy in north jersey were we were -- where we were, thousands remain out of their homes. countless businesses have been washed away in the storm and have not been reopened. in july i visited orderly beach. there were many signs of birth -- of rebirth. houses that stood like skeletons on the roadside, the sots intact but insides gutted. many of the residence i spoke to felt left behind and forgotten by washington. they were still in pain. any of them had challenges not just with d.c. but with trent. i know no one in this room has forgotten those families. have soind us that we
2:45 pm
much more work to do. in new jersey we have an estimated gap of 28.3 billion dollars between what is needed for a full recovery and what we are receiving in federal support. this number considers residential and commercial sector support reimbursement of municipalities and activities. though congress passed a release package in the aftermath of the storm, billions of dollars in federal assistance have yet to make their way to families in need. once they run federally run packages, the reason that the reconstruction mitigation grant program provides up to $150,000 to individual families, critical dollars to help them rebuild their homes. this 600t week, million dollar program had yet to make even a single payment. the logjam in federal funding's is devastating. indeed the delay has put lives on hold and entire families were
2:46 pm
uprooted from their homes. small businesses still shudder. and iments postponed, have heard directed from any of those affected painful stories of strong people struggling against incredible odds that determined to make it one way or another. there is understandable concern as i go across my state. they speak of a bureaucratic maze that forces those impacted by the storm to complete reams of what seems to be unnecessary paperwork sometimes just to be considered for federal aid. they detail stringent regulations that lead to little to no flexibility. they worry about impending flags -- impending hikes in their rates as well. we must increase our sense of urgency to get funding out the door as quickly as possible, while still remaining goods stores of taxpayer dollars and always protecting against fraud.
2:47 pm
it is critical that we provide and toble grant programs avoid something that has been championed but i -- by the people to my right, were rooted bring -- where we would bring in economic concern. recovery from a national disaster of this magnitude is a very long process. it is not easy. thosed as it seems for here who have been toiling for over a year to make this work. , we can make sure it is much much harder for the new jersey -- we can assure you it is much much harder for the thousands of new jersey business owners and families. commitment to them is to join with all of you to ensure the folks from the -- to everywhere in between get the health they -- the helpalth they need, the help they
2:48 pm
respect, and the help they deserve. thank you. >> thank you very much. i have senator menendez next. >> thank you, mr. chairman. since you are going to include our full statement for the record i am not going to go through it all. or are a couple of points i want to highlight, particularly for the committee's consideration as it moves forward in thinking about future disasters. we just say i am thrilled to be here with my colleagues from new york, who were extraordinary in our joint effort to fight for the resources for recovery in our area. i remember my late colleague, a member of this committee that was passionate about this issue -- i appreciate then mayor ohchr doing an extraordinary -- then- mayor ohchr doing an extraordinary job. doing anbooker
2:49 pm
extraordinary job. you really test the mettle of leadership. we appreciate his leadership in this regard and look forward to having him work in with us and continue to recover. i want to commend the hud the transportation department, fema, there were many successes. there are many people who are hurting and they continue to language -- to language. there are those who find themselves in new flood zones that mean the ability to keep their home and what they have
2:50 pm
built in their lifetime is known the crosshair because of new requirements to either raise their homes and or a variety of other issues as well. there is a responsibility to ensure that when we give out the taxpayer cost money, even in a disaster, that we do it in a way that ultimately ensures the integrity of that money. that has to be balanced by the urgency of now. i appreciate that, hopefully part of what the task force is doing is how we do this prospectively. for disasterwait to figure out what the appropriate programs are needed to set up in response. trying to balance the integrity of the money with the need and urgency of now has been a challenge. there has still been too much
2:51 pm
money flowing to the state that does not quite flow to the people of new jersey. we need to do a better job of that. and the one thing i do want to take the balance of my time to talk about, and i appreciate virtually all of my colleagues and the chair having joined us, is the natural of, not the disaster we face, but the man- made disaster we have if we do not rectify it. that is the question of flood insurance. forreality is that thousands of people in new is an around-ry the-clock effort. new jersey families and others in the nation, as he saw by the broad bipartisan support, have been hit with a triple whammy. they were first flooded by sandy and lost their homes, their lifetime of effort, many memories of a lifetime, and then the second was they had to face
2:52 pm
repair and mitigation costs and they are thirdly, facing astronomical increases in flood insurance costs built into the flood reform bill that was passed before sandy hit. the fact is that the combination of updated flood maps and the phaseout of premium subsidies for the national flood insurance program buttons to force victims out of their homes and destroy -- threatens to force victims out of their homes and destroy communities. homeowners would be forced to pay premiums several times higher than the current rate. and those that cannot afford the higher premiums will be forced to sell or be priced out of their home, which will drive down property values and local revenues at the worst possible time. so i want to take the opportunity to promote a partisan legislation -- a bipartisan legislation that seeks to take a timeout, that seeks to say, we asked fema to
2:53 pm
do and affordability study. we shouldn't have premium that -- premium increases until that affordability is done and we find and affordability mechanism so we can keep the solvency of the program, but also create affordability so people do not lose their homes and be the victims of a natural disaster. ist, mr. chairman, i think one of the most urgent things. i look forward to your help and the help of our colleagues. >> thank you very much. senator jill brandt. -- senator gillibrand. m a i want to get a special thanks to senator landrieu, who i have dubbed the third senator from new york. she was such a visit for us advocate for our families. she made sure we could fix as many things in a dance to make sure recovery flowed on the make sure all of the logjams she experienced with hurricane katrina did not happen in new york, new jersey, and other states.
2:54 pm
she is someone who understands what works and what doesn't work. i just want to thank her for her andinued focus on recovery preventing and creating resiliency. her leadership has been extraordinary. want to thank senator menendez and senator schumer. strongernever seen champions than my colleagues to put themselves in the shoes of every family and advocates for what they need most. i want to thank them for their leadership in i know senator booker will not only state -- will stand in issues but he will be the same strong advocate. he has shown it as mayor and i know you will shun it as senator. obviously, the road to recovery is long and hard. new yorkers are strong. areebuild, we rebuild that -- rebuild better, we rebuild stronger. we lost 61 lives.
2:55 pm
we lost hundreds of thousands of small businesses. we lost 300,000 homes. i remember senator landrieu, who suffered far more loss of life, cannot quite conceive of the loss we separate at home because our population was so dense. our road to recovery was difficult and different. our solutions are difficult and different. i think what you're doing is essential to meeting our goals. congress is try to work hard on a couple of problems and did a few things that were necessary. we extended the critical deadline to give sandy survivor's the time they needed to document the losses, which is difficult for some families. we did ease regulations that would have invented substantially damaged homes from acquiring excess of funds. this is something that senator schumer was very aggressive on, very early on.
2:56 pm
there were a lot of projects that the army corps has designated as necessary. he made sure that it was not funded. we have to do so much more. that is what the senators have already talked about, have touched upon. we have to continue to assure that the red tape does not get in the way of reimbursements. we need to make sure that these communities can get the financing and the money they need. we has to make sure that homeowners, individual homeowners receive the kind of resources that they need to build. the senate must pass legislation that we have cosponsored to delay flood insurance premium increases. these increases are set to take affect and no one can afford them. they are of -- they are on affordable for nearly every new yorker i have spoken to. you cannot have a flood insurance program that is too expensive for everyday americans. it just does not work. we must do that.
2:57 pm
has completed the study we can look at it and congress can help make a plan on how to raise the affordable -- given as homeowners are rebuilding their seeing this increase. many new yorkers may not be able to rebuild. they are homeless. as we continue to recover from sandy we need to throw that we need to strengthen the resilience for our future storms. this is not the first nor the last superstorm. as we see storms come and more violently, more damaging, more lives lost, we know what is to come. when we rebuilt would have to rebuild for the future storm. -- when we rebuild we have to rebuild for the future storms. called theed a bill strong act, we introduced it in the ep w committee. it is a bipartisan bill. it is the kind of bill that builds on the progress that mary landrieu and others have been
2:58 pm
making on these storm recovery efforts. thatso do something engages the local government by requiring the government to develop strategies. we have come a long way in the last year. as i have said, we have so much more to be done. reports of how few homeowners have been actually able to rebuild, it breaks your heart. new yorkers want to rebuild, they want to rebuild stronger but they need your help. >> thank you very much, senator schumer? >> thank you mr., chairman. -- thank you mr. chairman. senator landrieu has been invaluable. we have learned from the mistakes that were made in katrina and she was our guide as we went through this. i want to thank my colleagues here. we were a great team. ,hey made the impossible
2:59 pm
getting $60 billion -- we were held up for a two. -- ray too long -- for a too long. bang -- too long period of time. i want to welcome senator booker . he will fill large shoes as a member. i want to say to the five of you, i have worked closely in making sure getting things worked -- making things work. have done a public service at the federal and city level. and i thank you for that and look forward to continuing to work. i can think of accomplishments on each of you that we have done together in terms of negotiating and getting things done. , jok you to shaun donovan holloway.ey, cas
3:00 pm
keep an eye on us. well, you know, there's so much here. first, there's a question how is it going? it's going, overall, very well. amount of money that has been spent and allocated is .arge and at least up till now, and let's hope it continues, we seen a major misspending of money. we wanted to avoid the scene of trailers being unused which happened despite mary landrieu's great efforts in louisiana. and then what she warned us of as well, lots of money sitting be used.t couldn't so the way we structured these programs, particularly cdbg but corps's programs, the transportation programs, the fema programs as well, was to make sure that the money would go where it had to go and go
3:01 pm
quickly but without wasting money. so i know there was a move -- money should be spent in three months. if that were happening, there still millions of people, or thousands of people, complaining that they didn't get needed because it wouldn't have been allocated carefully and properly, and there would have been lots of newspaper reporters writing about, oh, all the misspent money. that.en't seen so it's taken longer than we would like. and it is certainly true that not gotten the money that we would like to see them have gotten more quickly. but i believe while the first year was one of laying the , makinge and recovery sure the roads were cleared, making sure people had electricity, making sure rents hundreds ofr the thousands of people who were pushed out of their homes, the year -- first year was recovery, but second is rebuilding. flowingy is flowing and
3:02 pm
well, and flowing, i think, in a way that it will be better used than in any major public disaster in the history of this country. will se wners see $1.4 billion. didold many of them, we all together, lay out the money to rebuild and you will be repaid. the combination of the fema program, which is fairly rigid cdbg program which is more flexible, will lead to that happening. now, it couldn't happen for a lot of reasons. first, people did have to rebuild. second, we weren't going to pay shouldivate insurance step up to the plate. so we had to see how much private insurance people were getting. what we made sure of is if your was $100,000 and your fema money was $10,000 and your insurance was $40,000 and you had a $50,000 gap that cdbg money will be there. good thing. second, we worked really hard to make sure that there were processes put in housing and transportation and
3:03 pm
in everything else we did. we rebuild, we'll be much more resilient against a future storm, which has been said will happen. and we've done that. and that makes a great deal of sense, too. i predict that the second be aof sandy recovery will year when people see lots of r rebuilding. by the end of year two people will be a whole lot happier with the program than year one,t the end of but it's because of the good ,ork that we all did together the five of us here. cory, of course, doing his work in newark. of us at the federal level and those of you back there. it's been a strong team effort that i believe will be regarded as one of the most successful aforts in terms of getting large area to recover from a horrible storm as well and as quickly as possible.
3:04 pm
>> thank you, senator. of first to speak secretary hud, secretary donovan, and has served in the position since 2009. alaskaou for coming to as you have done before. you i know you have a personal of what happens in new york. let me turn it over to secretary donovan. >> chairman, senators, it is a pleasure to be joining you today. rememberinggin by that last week on the one-year anniversary of hurricane sandy paused to remember all of those who lost their homes, their businesses, and tragically lost their lives. i remember visiting the region struck andthe storm being stunned by the breadth of
3:05 pm
destruction. $65 billion in damage and 650,000 homess, damaged or destroyed, 9 million people lost power. was clear that the road to recovery would be long and difficult. but if you know anything about region, androm this i'm proud to count myself as one of them, it's that they are resilient. knocked down, but they always get back up. after sandy, they began the work their lives and communities back together and president obama pledged his these legal efforts in order to ensure a full recovery. thee create -- we created taskforce to maximize cabinet level coordination in support of region. to rebuild this i have been enormously proud to chair this effort as we worked basic goals.o one, to get the assistance that au all fought so hard to make reality, to communities as quickly as possible. immediate needs. and, second, to ensure that the
3:06 pm
region rebuild stronger and than before so that it's better equipped to deal with future storms. let me begin with the work of getting assistance to communities quickly and effectively. as you know, in january, working with all of you in the congress, state leaders fought tirelessly to get $50 billion in funding inlemental order to aid victims of the storm. it's been a priority to get these dollars into communities quickly and responsibly as possible. that's why we thought it was critical to include several the supplemental that facilitated more efficient spending of these dollars. i want to particularly call out senator lan landrieu for all ofr .elp and assistance on this a few examples. giving hud the authority to duplicative environmental reviews. as a result of these and other measures, we made great progress number of fronts. more than 230,000 people in small businesses have received assistance from fema, the
3:07 pm
small business administration, labor.artment of more than 99% of sandy-related national flood insurance policy totaling more tha than $8 million have been paid filed policyholders who claims. 97% of public beaches in the affected region were opened by memorial day 2013, sending a strong message that the shore was ready for business. when you include the national flood insurance program, the administration has nearly $40 billion in funding for recipients with $13.5 billion of this already paid out. hud in particular, has allocat allocated $10 billion in community development block grants including an allocation that took place within eight the sandye signing of supplemental into law. this it represented the fastest the allocation following signing of an appropriations bill. so relief is getting to communities. said, weu have all know it can never be fast enough. that's why we've been creative work with ways to local partners to expedite the
3:08 pm
rebuilding process. businessudes the small administration's work to accelerate application processing times which has ok's during -- abouto 42 days, a drop of 1/3. the use of a streamlined permit and review process for complex, infrastructure projects that's based on a model which is implementationed times by 51%. one example, cutting three to five years off the projects like the tappan zee bridge. of foreclosure prevention policies in disaster-effected areas making stay in homes at such a critical time in their lives. and the establishment of a minimum flood risk reduction standard across the for majorvernment sandy rebuilding projects, representing the first time a standardovernment-wide has been set that accounts for the effects of rising sea levels we'll moving forward, continue to look for new ways to
3:09 pm
remove unnecessary barriers and headaches, ensuring that the that flow into the region are put into use as quickly and efficiently as possible. our other goal, rebuilding stronger and smarter so that the region is better prepared to withstand future storms. on august 19, the taskforce released our rebuilding strategy included 69on which recommendingions to do just that. it included steps to harden our producer grid and our fuel supply chain to address the sawge and gas lines we during sandy and steps to help families and small businesses times. in these new the strategy also identifies ways to leverage additional private funds to support infrastructure projects. investing in projects that will make our communities more resilient is vital to their safety. it's also good for our economy. as senator guillen brand point out, we know for every dollar we spend, we save $4 in avoided costs in future storms. recommendation in this strategy has a detailed implementation plan, and i and my department will be accountable to the region to
3:10 pm
you, to see them through. and we will stay at it for as takes knowing that eventually we'll emerge stronger and more vibrant than ever. earlier,ioned following sandy, it was clear that the road to recovery would long and difficult. we made significant progress. families have gotten back on their feet, businesses reped o, communities turning the page and looking to the future. that much more work needs to be done. all of us in the obama administration are committed to local partners and with all of you to continue to get assistance to those in the rebuilding, ensure the region is better prepared to withstand future extreme weather improve ourwork to recovery efforts across the nation. these are goals i look forward this committee on and i look forward to answering your questions today. thank you. >> thank you very much. person i have on the list is has served as a deputy dot since 2009 before becoming the deputy secretary he served twice as a secretary of the maryland of transportation.
3:11 pm
thank you very much for being here. >> thank you, chairman. and members of the subcommittee. it's a pleasure to be here today to highlight the department of innsportation's role assisting the communities that were devastated by hurricane sandy a year ago. hit, thehurricane damage it caused didn't just take a tragic human toll it also blow to thestating regional transportation system which is the life blood of the region's economy. the aviation side, three of the busiest airports in the country flights were effected. the highway system, as well, suffered significant damage. stands apart is this historic storm triggered the worst public transit natural disaster in the history of the united states. disaster,e to this congress passed the disaster radio he leaf appropriations act included $12.4 billion in aassistance for transportation .rograms it's worth noting that assistance was reduced b to$6,750,000,000 due requestions taking -
3:12 pm
taking -- $650 million, due to sequestration. program proy relief prosed by president obama in 2011, later authorized by our map 21.tation bill this emergency relief program for transit was in place for about 30 days before the hit.ter in addition to helping transit repairs,make immediate the program also supports mitigation activities that will improve resiliency and help transit infrastructure resist future.storms in the disaster relief appropriations funding also went to fix the transportation network as well, roads and bridges, restore amtrak service, mentioned, repair airport facilities at newark, guardia and -- la j.f.k. to date, the department of transportation allocated nearly $7 billion for repairs and resiliency efforts in response to sandy. we've learned a lot from the hurricane experience that will help us respond to future even
3:13 pm
events. andt, a coordinated efficient federal response is essential. president obama's hurricane rebuilding taskforce has helped all the federal agencies involved work together to best possible outcomes for the communities effected by the storm. donovan's leadership has been important in moving forward. second, hurricane sandy and recent disasters underscore the nation's vulnerability to extreme weather climatender current conditions. that's why one of our top priorities moving forward is to existingotect transportation infrastructure and equipment from the impact of future natural disasters it just makes sense if we're going to spend money rebuilding transportation, let's build it last. we'll soon be issuing a notice forunding availability capital projects that will reduce the risk of damage from future disasters in the region impacted by hurricane sandy. we're going to do that on a competitive basis. these investments in resiliency will help reduce the
3:14 pm
need for any future recovery efforts. and has been previously pointed out, research has shown every on actionst by fema to reduce disaster loss now saves the nation almost $4 in impacts. we're hoping to realize similar americanngs for the taxpayer by ensuring that our transportation infrastructure is futureo withstand storms. however, i must caution the need investment far exceeds the available funding. emergency has only relief funds available for hurricane sandy recovery efforts and nothing nationwide beyond that. leaves us without any ability at the department to address our next crisis, emergenciesture occurring outside this region. much of my own career has been at the state and local level. i know firsthand how important respond quickly and effectively. i strongly encourage congress to appropriate funds so that when
3:15 pm
the next disaster strikes and takes public transportation offline, we'll be in a position to respond immediately. i thank the subcommittee for meg t -- inviting me to testify. thank you. >> thank you very much. mr. craigpeaker is fugate who was confirmed for the fema administration -- in 2009 after serving as the director of the florida division of emergency management. managed the largest federal disaster response in florida history as four major hurricanes impacted the state. thank you very much. good to sigh again. chairman.ou, mr. senators. secretary donovan laid out a lot of the numbers. to come back to what you have done to set the stage for what we were able to do as a federal government and then our next steps. withoing to start something that you're not hearing a lot about, but i think it's important we talk about. the continuous support and fulling for -- funding for state and local and grants and
3:16 pm
emergency management grants building the capability at the and local level to manage the impacts of these types of disasters. the federal, government could not have done its job if our state and local partners weren't able to do theirs. so this is one thanks for the investment over time specifically since 9/11, those investments are paying off in capability and resiliency our communities have against all hairs yards. the -- hazards. we would not have been prepared to respond without the formation i doubt very much i would be here testifying. that law substantially changed fema mission was, requirements of the person that has chosen to lead the organization, as well as the wait untilred to not states are overwhelmed before the federal government can mobilize. this put us in the position under the president's leadership and playssources before any state was hit by the
3:17 pm
storm, before we knew how devastating this was going to be. again, those tools set the stage for the response and support of local government. but the other part of that, which we oftentimes talk about the supplemental, overshadows something i think is fundamental, a change to the stafford act. and that was the sandy recovery act.vement many of the issues that we still had, that became impediments to recovery. probably one of my best examples debris.n we were actually increasing the cost of removing debris because and policy that said if you use your folks and your public works department to we're not going to reimburse you for those costs. only their overtime. to do hire a contractor that we'll pay you the full cost share on that. these tools that we began to implement. we have used them in disasters post. these were not sandy specific,
3:18 pm
but sandy became the catalyst of we would be better stewards of getting money out effectively and state local governments to rebuild faster tohout losing the ability maintain the fiduciary responsibility of ensuring that the dollars go towards the intended to go. we have used these not only in but in some of these that we were allowed to go to previous disasters, where we've to use estimating tools in vermont to did a big challenging project there. do somebeen able to things that quite honestly they gaves made sense, but you us the tools. fewalthough it was only a tribes impacted, this came after sovereignhink for our federally recognized tribes also something that was very unheralded. finally gave federally recognized tribal governments the recognition of their sovereignty that no longer requires them to go through a state to request declarations.
3:19 pm
that programented after the law was signed. the first tribal government that the eastern band cherokee. we did not wait for the rules to catch up. we did not wait for our to catch up. we implemented the law as intended and have successfully declarationsster at the request of tribal governments. we have a lot of work to do. only -- we tend to look at one-year marks. but i knew going in this was multi-year recover rix think senator schumer said it right, that the first year is initial stepsse where you see a lot of progress in the beginning and then it starts to slow down. because now we're starting to the rebuilding. and from the president's direction on down, what we want rebuild for is we the future and not the past. that we can make these improvements and make investments that we may spend a the front more in end, but we assure the delivery of critical services and future.ucture in the
3:20 pm
and then lastly, senator theinez, again, we agree administration's position on the reauthorization of flood insurance programs, we needed to affordability, but we found that in the legislation past, we to allowave the tools us to use that to build affordability o before the took so, again, we look forward to working with congress to get a allows us not to keep kicking the can down the road but address affordability for live in their homes but also ensure we're not the same way, putting people and future generations at risk. thank you. chairman, martinez was my former colleague from florida. >> sorry, senator mendez. >> we're both cuban but we don't all look the same. >> yes. sorry. >> great. thank you very much. >> let me also say i really withciate the work you did the tribes. that's a huge opportunity. thank you for that. ist person i have
3:21 pm
ms. jo-ellen darcy, assistant secretary of the army civil primaryich is supervision over the u.s. army corps of engineers. prior to her appointment, ms. darcy served as the advisor to the senate finance committee conservation,rest energy issues. good to sigh again. thank you. you, senator. thank you for the opportunity today to testify on the corps's continued working on the recovery from hurricane sandy. the federal support during the response to sandy was unprecedent. the corps was part of an interagency team to include governmentscal which provided technical assistance and rapid response activities across the impacted areas. the disaster relief appropriations act of 2013 withded the corps $5.35 billion to address damages caused by hurricane sandy. tos money's being used reduce future flood risk and increase the long-term the coastalty of ecosystem and communities while reducing the economic costs and with largeiated floods and storms.
3:22 pm
the corps has made significant progress in the year since hurricane sandy. and in the time since the passage of the appropriations bill. the corps's hurricane sandy recovery program has three major components. first, it's our near-term component that supports repaircy operations and and restoration of previously constructed corps projects along dredging federal navigation channel and repair of corps-operated structures. secondly, investigations component that expedites the completion of ongoing studies at federal expense and funds the north atlantic coast comprehensive study. our construction component rehabilitates, repairs, and constructs projects to reduce future flood and storm damage risk in smarter and more .ustainable ways as part of the near-term component, the corps started restoration ofd existing projects along the atlantic coast in february of to3 and is scheduled conclude these actions by the fall of 2014.
3:23 pm
to date, the corps has placed approximately 12 million cubic yards of sand to repair dunes workerms and will continue to restore them to their original designed conditions. obligatedcorps has almost $390 million to restore damage projects. the total 33 projects in this phase, seven are completely have been -- have awarded contracts, construction contracts, and four are in the pre-award stage. near-term efforts also include addressing the storm's impacts navigation infrastructure. the corps's operations and maintenance work began in of 2013, and most projects are scheduled for completion by the spring of 2015. fiscal year 2013, the corps had obligated over this work withr 35 projects completed and 28 in construction. for the investigations component, the corps is using funding to expedite completion of 18 flood and storm damage
3:24 pm
reduction studies in the northeast that were underway occurred. $20 million of the investigation funding is for the comprehensive will assess 31,000 miles of the north atlantic coastline bringing and coastalerts planning, engineering and science from more than 90 academic, and non-governmental entities. the comprehensive study team has developed a draft framework currently under review. and the results of the study, we think, will inform our future -- efforts. the corps was also directed to conduct a performance evaluation study to evaluate the effectiveness of completed corps projects during hurricane sandy to include summary recommendations for future improvements. i signed the transmittal of this this morning. so it should be here on the hill by now. [laughter] the third component of the program will construct projects authorizedreviously but not constructed at the time fall.ricane sandy's land potential projects identified
3:25 pm
for implementation following the investigation process and withins that will fall our continuing authorities program. expediteddesign, and reevaluations are underway for the 18 previously authorized but constructed projects and the corps anticipates construction will begin in early 2014. the corps expects to complete construction working on roughly half of these flood-risk projects by mid 2015. of the identified continuing projects, massachusetts, connecticut, new york, new jersey delaware, areland, and virginia currently scheduled to receive beach erosion and coastal storm damage risk reduction projects. and we expect 70% of this work by 2016.pleted there will always be residual ink for americans who live coastal regions. expected changes in sea level otherextreme weather, and impacts are likely to increase the risks fating these areas. -- facing these areas. together with noah and fema, the
3:26 pm
corps of engineers developed a helpevel rise tool to communities anticipate the influence of sea level rise. will use base flood elevation maps from fema, the coastal of noaah.pabilities and a sea level rise calculator engineers.rps of this tool yesterday was recognized by the president and awarded the green government climate change champion award. ourhe collaboration between agencies as a result of sandy has already produced a future-looking sustainability and tool that we can all use throughout the federal government. in addition, noaah and the corps of engineers are working moreher to help rebuild resilient and sustainable coastal communities. while working on post sandy york andefforts in new new jersey know ya and the corps set systems, rebuilding principles in order to promote a unified strategy for activities coast.oring the
3:27 pm
collaborative efforts on all levels continue to explore and that reducelution risk from coastal storms such as appropriate land use planning, non-structural solutions, and well communicated evacuation planning. mr. chairman, and members of the committee, i thank you for the opportunity and look forward to questions. >> thank you very much. our next speaker is ms. kathleen thai, chair of the recovery, accountability, and transparency board while continuing herr inspector general for the department of education. the board has been charged with dollars beingal spent on the sandy recovery. thank you for being here. >> thank you very much. mr. chairman, senators, i want the opportunity to appear before you today. as chair of the recovery board, i will be speaking to you about the board's roll and the inrsight of funds expended support of hurricane sandry recovery efforts. the boards with a created in february 2009 ooze part of the recovery act.
3:28 pm
it consists of 12 inspectors its mission to s to provide transparency of the use of recovery funds and to prevent and detect fraud, waste and abuse. we meet this mission by managing website through which recipients of recovery funds report and by spendingg that information in unique ways on our public website, we also develop the recovery operations center or what we as a central data analytics service to support fraud detection and prevention. roc has the ability to rapidly aggregate and analyze of dataomplex volumes to screen for potential risks or identify targets and provide deeper investigative information in the support of audits, prosecutionns and ises. while the board was originally due to sunset on september 30 of this year, the sandy legislation extended the board through 2015 with additional
3:29 pm
duties for the board to develop and use our resources and mechanisms to detect and remediate fraud, waste, and funds related to hurricane sandy. our oversight efforts related to have focused on applying the techniques and processes developed by the roc examine the spending, primarily working with our ig partners. theoordination with department of homeland security office of inspector general, we of 104 entityview that received hurricane sandy from 32emoval contracts cities in new york and new jersey totally over $329 million. among the particular risk dhsoigors we reported to were firms whose owners had liens, and state tax ones that had been listed on the federal list of suspended or bidders, and companies that had filed for chapter 7 bankruptcy and had federal tax liens. in addition to this work, we
3:30 pm
have provided assistance to dhsoig on its investigations of other fema, hurricane sandy grants, and toce other ig's and their sandy work. island,state of rhode we undertook a proactive analysis of 10,000 potential contractorsndy against our data bases that would show potential risks and reported information back to that state. in addition to our work in the website,re using our to information is available on hurricane sandy spending. we visually display hurricane sandy-awarded contracts from the federal procurement data system award information as well as links to fema spending by state and state hurricane .andy websites we also display the department of justice's disaster fraud .eporting hotline we are currently in the final stages of moving the hurricane sandy information to our website to be able
3:31 pm
to better use the .unctionalities of that website since commencing our working on hurricane sandy mission, we've identified a series of that we continue to face. the first is a painting accurate complete hurricane sandy spending data. with no mandated centralized such as in recovery, access to standardized data is limited. procurementderal data system and usa spending have information related to sandy, each has its limitations. for example, on usa spending, hurricane sandy grants and loans lack a unique identifier, making accuratelytic to extract and analyze hurricane sandy awards. subddition, the lack of recipient data will further complicate our work. given the types of hurricane sandy grants expected to be awarded, prime recipients of these awards oftentimes will be a state or a municipality but historically the majority of below this level by
3:32 pm
entities performing the actual work. my testimony. thank you for the opportunity to discuss the activities of the board. answering any to questions. >> thank you very much. for our last speaker, again, i want to thank you for being here. before i mention you and your title, i want to the sure the folks know for record we did invite representatives of both the new ork state and new york -- new jersey state government. they declined the invitation. so we're happy a local person is here. i appreciate that as a deputy onor for operations august 4, 2011, as deputy mayor, mr. holloway oversees offices including the police department, fire department, office of emergency management. mayor michael say bloomberg, but you had an legislation last night. i'm not sure what it is today. glad you're here. we appreciat it, especially from a local perspective. so, please. you very much, mr. chairman. just for clarification, the january 1.n is so i still have my job for the
3:33 pm
next 55 days. [laughter] does the mayor. >> very good. good afternoon, march and senators. -- mr. chairman and senators. thanks for the opportunity to testify about the role and toectiveness of federal aid new york city's recovery from hurricane sandy. i want to begin by thanking you behalf of mayor bloomberg and all new yorkers for answering new york city's call after the unprecedented devastation caused by hurricane sant sandy. from president obama and members includinginet, secretary donovan who's here today to entire agencies of the particularlynment, fema, hud, and the army corps of engineers, to assets including generators, fuel, food, and many others to the billions of dollars in recovery aid that available through the disaster relief appropriations act of 2013, what sandryfer to as the recovery bill. the federal government has been there for new york city since landfallre sandy made on the new jersey coast last october 29. sandy was the worst natural disaster to ever strike new york
3:34 pm
city. it took the lives of 44 new yorkers, caused unprecedented damage to public infrastructure and private property and onggered an enormous and doss going response. i will touch on the role of federal aid in three components recovery. before and up to five months after the storm the second stage thatng recovery efforts are underway now and will continue for the next 12 to 18 city's plan to protect and mitigate against the thatte-related impacts have become an increasingly life.nt part of everyday i'll start with the pre and immediate after sandy aid. our partnership with federal agencies began well before sandy moved up the east coast to the united states and took that left ward hook that would subject new york city to the storm's most devastating impacts. the city implemented its coastal storm plan, fema and the national weather service were us at the city's emergency operations center. and i was there for days. attest we had much support.
3:35 pm
though the storm did tremendous damage, the prestorm evacuation largelyn was successful. and post storm surveys indicate that most new yorkers knew about the storm, knew if they lived in theynerable area, and knew should eyak kuwait -- evacuate. after storm together with fema enat new york national guard we removed an estimated 700,000 tons of storm debris through some of the contracts that mrs. tighe mentioned. -- and the than defense logistics agency. distributed more than 2.1 million meals ready to eat and canvassed more than 100,000 areas tos in affected distribute food and water, sanitary items, and make referrals to healthcare case services. as we reported to you when congress took up the act, the estimatedred an $19.5 billion of damages due to nearlyrm including $5 billion in direct recovery costs, hundreds of homes were totally destroyed, thousands of famesly, families displaced.
3:36 pm
given the density of new york city and the challenge of relocating, mayo mayor bloombere it a priority to get people back into their homes. the entire -- the creativity of craig fugate and his team at fema, we developed fema called the shelter and temporary essential power program step. in store city we called it rapid repairs. rapid repairs was an innovative approach to shelter that is based on a simple premise, the best temporary shelter is shelter. step enabled the city to hire contractors to make emergency hot water and power repairs to victims' own homes. and only 110 days since we went into the first home on november 21, the city was able on 11, 800 repairs homes and multifamily buildings. enabled roughly 54,000 new yorkers to return to their homes. and our survey data indicates that many -- most people, the vast majority, are back in their althoughnew york city many still need to recover.
3:37 pm
i have -- have additional do all federal dollars are accounted for properly -- and we want to make sure they're properly spent. it's been a priority for new beginning.ince the will we have established monitoring programs overseen by the department of investigation the housing initiatives we have undertaken. we will continue this rigorous oversight. can provide reporting at any level that the committee would like. while rapid repairs helped thousands of new yorkers to move back into their homes, that was the beginning. thousands of families need much done to make a full recovery and make their homes able to better withstand climatetorms and other impacts. thanks to 15.2, it was 16 toortunately due sequestration, of community developed block grant funding, leadership of shaun donovan and the federal recovery taskforce, we launched build it back, a $700 million program in june, with the city's first cdbg funding and
3:38 pm
the basic idea is to help homeowners continue that recovery. avs october 31, nearly 26,000 families have signed up for the and approximately 500 of those had homes that were destroyed. we have encouraged many new yorkers to seek this help and we're glad that they've done so. need and, the overall demand does exceed supplies. so we will need additional to make surend that the neediest get funding first.port we've prioritized by income level and those who are the most damaged. that between 55% and 60% of all of these applicants group our first priority and we're focusing on them. right now we're actually have 8,000d we people who are going through insurance verification processes, tier two environmental assessments, and secretary donovan's been very to streamlineing those processes to take advantage of the work the done.l government has at the homeowner and building
3:39 pm
level, the greatest remaining challenge for new yorkers is the affordability of flood insurance. members of this committee is well aware of it. the city commissioned an independent study that shows that only 35% of property owners the floodplain who were required to have flood insurance had premiums could go up for the new fema maps that are going to be o ing out from an average of $430 a year to $5,000 t to $10,000 a year. encouraged by the legislation working its way through to delay until affordability can be addressed in a real way. the greatest long-term challenge we face is protecting new yorkers over the term. at the same time that we are getting families back into their homes and repairing the city's principle structure, the mayor commissioned a study on the impacts that new york city will and the 2050's. the result is this plan, stronger, more resilient new york. i brought some extra copies for the committee. you can get it on our website,
3:40 pm it has initiatives to protect of york city's 520 miles coastline as well as critical infrastructure and service term.ks over the long sandy took out huge segments of the power grid. 95% of the telecommunications network in this lower manhattan. it took out hospital row on 1st closing down hospitals around the city. achievable, an affordable way to mitigate the most -- most of these impacts otherhe next big storm or climate event, whether it's a flood, downpours or drought, city.ew york and we are on track to complete 43 critical milestones before year.d of the the army corps of engineers is one of our most important partners in this effort. we estimate more tha than $1.5 million of cubic yards lost.d were 3 million more cubic yards are on the way. i have to say having worked with for the lasts seven years, the work that they're doing on the beach right i've ever fastest seen them operate without
3:41 pm
exception. summarize?ve you you're a little over the limit. >> sorry about that. >> don't worry. your statement will be included record. >> great. i just want to note, new york do all of this recovery alone. there are many areas over which no control.le or the power grid, telecommunications, and other critical networks. and so we want to work with congress, with additional we'll get tohat make sure we can implement this plan. clearly we have a long way to go and we'll need additional allocations. but if the support we've received from congress and the far is anyernment so indication, i'm confident we'll be able to meet those needs and better prepare new york for climate challenges come next. i'm happy to answer any questions. >> fantastic. thank you very much. to go to the ranking member and then i'll come back to me and then down to the other here.mbers that are senator paul? >> thank you. .hank you i grew up on the gulf coast, so
3:42 pm
i know about hurricanes from personal experience. of you tryingall to help in the aftermath of a .errible hurricane question for secretary donovan. do you think that sandy relief on tvought to be spent ads? >> i assume what you're referring to, senator is that aere has been an effort in number of states not just in well but historically as in many, many prior storms to economic development. we did see a small amount of cdbg money that was used for an tonomic development campaign encourage people back to the beaches. >> do you think it's a good idea or bad idea? we've --idence that >> spending funds on tv ads. >> the evidence that we have campaigns arehose effective in growing economic development in those areas. and, therefore, they actually
3:43 pm
reduce the cost of recovery to government. >> i don't think we need to argue about whether ads work. ads work. but do you think ads for sandy relief should be spent on tv ads? yes or no? idea, bad idea? >> as i said, we looked at the have seen itwe encourages economic development. >> my understanding is you all a waiveyou have to give tore do this. >> senator, if i could -- the community development block flexiblea very program. this is clearly within the legal of what congress has determined the program can be used for. waswe were -- it demonstrated to us that this could be an effective tool. and actually lower the cost of government. >> it gives a little bit of a black eye to something that going to a of it is good purpose. but i would say that if i were in your position, i would have tod no, we're not going spend ads. here's another problem. some of these ads people running their mug all over these ads while they're in
3:44 pm
the middle of a political campaign. jersey 25 million was spent on ads that included somebody running for political office. be ahink there might conflict of interest there? that's a real problem. people o who are trying to do good and trying to use taxpayers' money wisely, to see ourended money spent on political ads. that's just offensive. have ayork, you actually rule. they're not allowed to do it. sox new york did the same thing -- so new york did the object, butwhich i at least they didn't put someone's fate face on the ad ad their family. a i think, yeah, come to new jersey but it's like, i don't want to pay for ads for advertising out of sandy relief fund it gives the whole thing a black eye. it isn't just sandy relief funds. we spent $684 million for obama care. well, it's a fairly contentious issue that was very partisan and one party. should we then get to spend taxpayer money advertising for political purposes? i don't think a penny of
3:45 pm
taxpayer money should go to advertising. advertising. here's the other criticism. outle appointed -- pointed it's taken a while for money to get to people. i think it was like one article homeownerouse or one in one instance coming for an department yet the money tv got through quickly. when people want to advertise and promote themselves, all of a sudden, bowed 3w5078, money -- boom, money is on tv it and so is their ad. just ask -- i know you want to do the right thing. not it's awhether or good idea. my understanding is it took a waiver from your office to use for this and that the tv ads had to be approved in that sense by your office. is, there have been community development grants given to something called a river festival in manhattan. i sure hope none of this money i don't to it and that find in and out a year the river festival got money for this. because the river festival is and of all kinds of great groovy things like performance
3:46 pm
art, bunch of people showing up their cell phone up playing the same songs. that would be a lot of fun. i would thereof attend. going toe we're not find sandy relief money went to stuff like that. as you said, community block anything. go to so i sure hope that someone is watching the taxpayers' dollar. all i have. thank you. >> thank you very much. secretary donovan, can i follow up? clear to make sure we're on one thing. the cdbg money, as a former mayor and i think now senator say the same thing, it can't be used for anything. there's limitations. correct? >> exactly correct. i did not say it could be used for anything. clear statutory purposes. sure thatd and made it did meet those purposes. if congress determines that development campaigns should not be included, then obviously that could be added to legislation. but currently they are within bounds of the law. >> let me get to a broader question. that -- i have a chart i've seen.
3:47 pm
i'm trying to analyze this. fema -- i think i know the answer, but i want to have at least a three agency people, other than fema, answer this. feelia, when i look at the money -- fema, when i look at the money of appropriated, obligated, expendeds, you're fairly high up there. you've moved the money out the there. the other is in the process or not as much in the percentages's so maybe if i could start with secretary donovan and then go to ie next two, just so understand why there's a lag -- i think i know the answer, but i hear thiske sure i for the record. i understand fema, because you've got to get in there. you don't have the luxury of years and bring the money after the fact. so help me understand that. because that's one of the a lot of that i get times when they see the reports and say -- where's the money being spent? i start with you? >> absolutely. importantis is a very point. one of the things that's critical to understand is by law is only allowed to be used on
3:48 pm
otherthat are not met by funding sources. >> so you're the last bucket. step are the third effectively for homeowners, for small businesses. we've seen very consistently that fema moved to make that first allocation. but only up to $30,000 can be used for homeowners, for examp example. and that takes care of the damage. you must make sure that your insurance company has paid their claim. and that process needs to happen. twothen only when those have been utilized can we then make cdbg available. why cdbg only began to pay out more recently. let me just give you one comparison. at the point where we are today, since the appropriation was made by congress, we are more than wereaster in sandy than we under katrina.
3:49 pm
we are more than 300% faster on cdbg.ere in ike so clearly we have improved the process. do?there things we could legislatively or within our own power to make it faster? yes. we are working on many of those things. but relatively speaking, i think we both have been faster and more careful in the way we're using cdbg money in this storm. i move -- i ask you, some of those ideas at some point legislatively or regulatory, you can share those with the committee at some point? so if there's things we could be asng to help in the future, we continue to improve that flow, that would be helpful. >> absolutely. theuld just compliment committee on having made many changes for sandy that have sped up spending already. >> very good i was going to ask you if i have time, i'll ask about the bridge issue and how used the techniques. i want to know more about that. >> mr. chairman, thanks. question.nt the transportation funding that was provided in the supplemental is being used for very specific transportation purposes. .nd i'll quickly go through
3:50 pm
the federal aviation administration with the direct appropriation is -- has repaired damage to the three major airports in the region. that is work that we've done contractorr with forces. the federal highway releasedation first money within hours of requests under what we call quick release authority to get the work rebuilding the highway system. then its emergency relief program operates on a reimbursable basis. done. work gets it's done by state or local governments. and the federal government reimburses at the end. that is a way that we protect and make sure that we get the it shouldilt the way be. flan this case with some resiliency for the future. transit program, we've made extensive use of what we call pre-award authority. specific transit projects as part of the sandy recovery have given pre-award authority
3:51 pm
where the transit agency will be building those facilities according to federal reimburseds and then as part of the process. that's a way to get project underway quickly and make sure get the product that the taxpayers deserve. >> very good. jo-ellen? i said in in my opening statement, we have several money. of some for investigations, which is ongoing studies, as well as our comprehensive study. spend-out rate is not as quick as would be for our emergency money. had,mergency money that we we've expended nearly most of our expenditures. completed in be the early part of next year. those were the repairs to our existing projects. repairing the sand dunes that had been devastated. third bucket is for construction. had 18're doing is we projects that were authorized but unconstructed. and some of those projects had several yearsd ago. so what we're doing now is
3:52 pm
looking at those projects to see whether in the light of climate change and sea level rise, whether those projects are still -- will be sustainable and resilient. so that study is the less expenditure. but once we go through that study process, once we do the engineereconstruction and design which is a smaller amount of money, once we get to the actual construction, that's outlays.see the >> one quick question. then i'm going to go to the members. five-minute to do rounds. ca srks i'm going to speak in a moment. i'm going to substitute myself back to my mayor days. the frustration always with the organizations was they would get this money and then you'd hope and pray it would at some pointou in some rational deliverable way. me your sense of how that workedded or could have givebeen main maybe later recommendations, how did that work?
3:53 pm
cdbg, i don't know if it went directly to state or local. tell me how that worked when money went to the state? it?you're there waiting for >> well in this case, mr. the funding -- new york city got its own direct allocation, which was great for .s the level of damage that we totained and our ability take those resources and really start working with them strong.ely is really so far the allocation that have come, there's a separate of newion for the state york and new york city has gotten its own allocations from it's beenective, great. >> that's worked? >> yes. >> let me stop there. i have additional questions but go to senator booker. >> senator from new york, who has a wonderful view of new jersey would like to go first go.use she has someplace to >> please. >> thank you, mr. chairman. thank you very much, senator booker. work you've all the done and every single one of you
3:54 pm
has done extraordinary work in terms of getting money flowing, getting large projects done, getting things up and rung. i appreciate it. from my i hear constituents is not good. i hear so many stories of rebuild,nts who can't who haven't gotten money. there's so much red tape that theirannot possibly find way through. so i want to ask each of you tape thats of red concern me that hopefully you can give me the road forward so let my constituents know that relief is possible. secretary donovan, this one seems very difficult. a number of my constituents were that becauseearn they accepted small business administration loans that they now ineligible for cdbg funding. i understand the need to make duplication in getting federal benefits and we want to protect against fraud, but -- and that is absolutely critical to the integrity of this program. but is there any distinction grantsn be made between and loans under the duplication
3:55 pm
of benefits regulations? and under the current federal regulations what are the options for sandy affected homeowners whoaccepted sba loans but believe they are at a financial disadvantage relative to homeowners who chose not to an sba loan? >> this is something your office raised with us and that others did. clear thatally made even if a homeowner or business been approved for a loan, sba were still eligible for assistance. so, in fact, it is not accurate are ineligible. >> but they had been told they're ineligible. is that something we can fix in of those communicating? >> let me be clear though. in cdbg, iting else is up to local communities to they use exactly how these funds. and one thing that we have encouraged communities to do, i want to be clear about
3:56 pm
what situation the homeowners you're talking to, if a if a small business can afford to repay a loan, we not think, and we've made clear, that communities should grants available because these are precious, limited dollars. encouragedve communities to do is to do an evaluation. and i have heard frustrations owners,iness homeowners. they say, well, somebody else is getting a grant, i'm getting a loan. is, if they can afford that grant -- i mean, that loan, then doencourage communities to an underwrite and evaluate that and to use grants only where a homeowner or a business cannot afford to repay a loan. the guidance that we've given. but we do leave flexibility for communities to make that determination. that youd appreciate make that guidance very clear when someone's looking at an sba loan. need to know what limitations they will be under in the future. it needs to be clearer. >> i agree there was confusion.
3:57 pm
we have absolutely worked with your office. raised this before, to that. clarify >> thank you. deputy mayor holloway, we've yoman's working on so many infrom a fra structure issues -- issues.ucture but there's still enormous challenges for homeowners. while fema caps the payment at very few people receive the full payout. their home might have been destroyed and their eligible for grant $8,000. so while we do our best, it's homeownersfor these to rebuild. and in fact, there are families that are still homeless a year unit. that'-- a year out. that's horrible. island,zy point, staton the rock aways, how quickly do get tonk cdgb money will homeowners? what percentage have received any? >> each of those areas having workedere many times and with particularly in breezy
3:58 pm
point the homeowners association, we have done a lot advance building. it's not only getting the money. it's being able to actually build. things in the ground. so we've been able to advance that. in terms of fema recovery that really is a case-by-case determination of ther assessment of what damage is. we now have 26,000 families that signed up for build it back. and we are in some stage of financial assessment for them. so as secretary donovan said, money is money of last resort, which means that you have to do an insurance verification, figure out whether they got any other fema money, any funds from any other sources. we're working closely with insurance companies. but we have 1400 request for verification from one company in particular that hadn't been met. this process,s in which we're not opposed to in any way because you do have to sure that the dollars are going to people who actually
3:59 pm
need it, but they do take time. i think we have had some cdbg money flow, but i will say is not satisfied that it's gotten to enough people yet. i think you will see -- i'm will see --u between now and the end of the year we will begin to ramp up to then ultimately thousands who will be getting funding. >> thank you. let me address some of the red mayor is probably experiencing with regard to administrator few gate. -- few gate. fema worked with these throats submit project worksheets which eligible for reimbursement. over the last year many of these project worksheets have still been paid. and these delays have cause the to theback -- setbacks projectprojects. do you know how many project worksheets fema is process and what the anticipated time frame around is?ng those >> it depends upon the project. toroject worksheet is a tool
4:00 pm
determine what's damaged and what's going to be needed to repairs. we have prioritized working with the state. some of the first projects we're be -- were going to be all debris and all of the emergency costs that were expended. oute were dollars that went the door immediately. so as we've been going through that, we have to have to demonstrate the cost so that we can satisfy the theirements that they did work. it was expended. and we reimbursed that. out most of the emphasis has been on the initial cost. there are some that were still either needing more documentation -- and if you got specifics, we'll working on them. the rebuilding piece of those project worksheets is going to take more time. get in the permanent work, we have several different tools we're trying to use to speed this process up. we still have to work through the processes to ensure is this over 50%, are we going to be abl to mitigate thi? and what is