[Congressional Record (Bound Edition), Volume 152 (2006), Part 16] [Senate] [Pages 21545-21546] [From the U.S. Government Publishing Office, www.gpo.gov]DISASTER ASSISTANCE REFORMS Ms. LANDRIEU. Mr. President, like many in Congress, I am disappointed that we are adjourning Congress for the October recess without enacting comprehensive U.S. Small Business Administration disaster assistance reforms. As our small businesses impacted by Hurricanes Katrina and Rita last year can attest, this is an agency that is in woeful need of substantive reforms to its Disaster Assistance Program. Our businesses had to wait 4 to 6 months for SBA disaster loans to be approved, and some are still waiting to this day, for loan amounts to be disbursed. For my part, I have worked for the past year to enact substantive SBA disaster reforms to ensure that `lessons learned' from Katrina and Rita were incorporated and that businesses nationwide could count on a better prepared and more efficient SBA should a disaster strike their community. Under the leadership of the chair and ranking member of the Senate Small Business Committee, Senators Olympia Snowe and John Kerry, we sent to the Senate floor bipartisan legislation, S. 3778, which along with reauthorizing SBA programs, also enacts comprehensive SBA disaster reforms. Instead of working with us to take up and pass this important bill, the administration has frustrated this bill's passage at every turn and will not allow it to the Senate floor for consideration--almost 9 weeks after it was introduced. I am concerned about this lack of urgency from the SBA and the administration so just this week, I sent a letter to the new SBA Administrator Steve Preston. In this letter, I requested his cooperation with our committee to pass this important legislation before Congress adjourns at the end of the year. I will ask that a copy of this September 27, 2006, letter be printed in the Record. As we adjourn tonight, I note that we are set to pass legislation which temporarily extends programs under the Small Business Act until February 2, 2007. Although I do believe it is essential to extend these SBA programs, I worked with my colleague Senator Kerry to revise this date to November 17, 2006. This November date would have ensured that the Congress would have to return in November and at least attempt to pass SBA Disaster reforms. Instead, with these programs authorized through February 2, 2007, the Congress will adjourn in September 2006 and not take up SBA reauthorization until at least February 2007. I am disappointed by this development because, as elected officials, I believe it sends the wrong signal to our small business community. If the Congress, in partnership with the SBA, does not address these systemic problems now, I am afraid that it will continue to plague the SBA's disaster response for future disasters. I believe there is a general consensus that these reforms need to get done. Therefore, I will continue my work with my colleagues from sides of the aisle to make these essential improvements this year. Mr. President, I ask unanimous consent that the letter to which I referred be printed in the Record. There being no objection, the material was ordered to be printed in the Record, as follows: U.S. Senate, Washington, DC, September 27, 2006. Hon. Steven C. Preston, Administrator, U.S. Small Business Administration, Washington, DC. Dear Administrator Preston: Let me take this opportunity to again congratulate you on your confirmation as Administrator of the U.S. Small Business Administration (SBA). Your management experience and passion to serve will prove extremely helpful to you in this challenging position. I write you today because, as a member of the Senate Committee on Small Business and Entrepreneurship, as well as senator from a state hit hard by both Hurricanes Katrina and Rita, I believe it is my duty to ensure that we implement substantive changes to SBA's Disaster Assistance Program during this session of Congress. The SBA's response to Hurricanes Katrina and Rita was too slow and lacking in urgency-threatening the very survival of our affected businesses. A year has passed since Hurricanes Katrina and Rita, yet while Congress is currently acting on extensive reforms for the Federal Emergency Management Agency (FEMA), there has been only incremental changes to SBA's Disaster Assistance Program. That is why I am pleased to learn that you have recently created the Accelerated Disaster Response Initiative to identify and help implement process improvements to enable the SBA to respond more quickly in assisting businesses and homeowners in need of assistance after a disaster. I applaud these efforts and your leadership on this issue. But much more must be done to address the systemic problems that led to delays and inaction post- Katrina and Rita. For our part, the Senate is also attempting to address the multiple problems that hampered SBA's ability to assist impacted Gulf Coast small businesses and homeowners. Under the leadership of the Chair and Ranking Member of the Senate Committee on Small Business and Entrepreneurship, Senators Snowe and Kerry, the committee voted unanimously to approve S. 3778, the ``Small Business Reauthorization and Improvements Act of 2006'' and sent it to the full Senate for consideration. A copy of the bill is attached for your convenience. This bipartisan legislation re-authorizes SBA programs, and also [[Page 21546]] of great importance to me and my constituents, makes essential reforms to SBA's Disaster Assistance Program. However, Since S. 3778 was introduced on August 2, 2006, almost nine weeks ago, it has been blocked from consideration and the Committee is still waiting for budget information so that it may file its report on the bill. It is my understanding that the administration and SBA has several concerns about this bill in its current form. I am very concerned at this apparent deadlock, a deadlock which threatens our bipartisan efforts to implement comprehensive SBA Disaster Assistance reforms before the end of the year. In particular, I believe that there must be SBA reforms in the following areas: Short-Term Assistance: Following Katrina and Rita small businesses waited, on average, four to six months for approvals and disbursements on SBA Disaster Loans. In order to ensure the long-term survival of small businesses impacted by a catastrophic disaster, SBA needs to be in the business of short-term recovery-by providing either emergency bridge loans or grants. Disaster Loan Process for Homeowners: While SBA's mission is to ``aid, counsel, assist and protect, insofar as is possible, the interests of small business concerns'' it also has the added responsibility of helping affected homeowners rebuild their housing post-disaster. Katrina and Rita resulted in record numbers of SBA Disaster Loan applications from homeowners, which strained SBA's existing resources and personnel. If the SBA must bear this responsibility, the agency should improve the process as well as possibly seek greater coordination and cooperation with the U.S. Department of Housing and Urban Development on disaster housing assistance. Expedited Disaster Loans to Businesses: The SBA currently has no mechanism in place to expedite Disaster Loans to impacted businesses that are either a major source of employment or that can demonstrate a vital contribution to recovery efforts in the area, such as businesses who construct housing, provide building materials, or conduct debris removal. The SBA need the ability to fast-track loans to these businesses, in order to jumpstart local economies and recovery efforts. Economic Injury Disaster Loans: Although Katrina and Rita directly affected businesses along the Gulf Coast, additional businesses in the region, as well as the rest of the country, were economically impacted by the storms. The SBA must have the ability to provide nationwide, or perhaps regional, economic injury disaster loans to businesses which can demonstrate economic distress or disruption from a future major disaster. Loss Verification and Loan Processing: Following the Gulf Coast hurricanes, the SBA struggled for months to hire enough staff to inspect losses and process loan applications. Although SBA now has trained reserves to handle such surges in demand, the SBA also needs the permanent authority to enter into agreements with qualified private lenders and credit unions to process Disaster Loans and provide loss verification services. Administrator Preston, I was impressed by your expressed willingness to be a bridge between Congress and the White House. For the SBA to truly bring its disaster capabilities to the next level, I believe that it must work in concert with the Congress. Together, we must remove layers of bureaucracy and red tape, which, following Katrina and Rita, both overwhelmed and frustrated dedicated SBA employees and those affected by the hurricane must also give the SBA new tools to ensure that problems that occurred post-Katrina and Rita never happen again. Last month we marked the one-year anniversary of Hurricane Katrina, and now mark the one-year anniversary of Hurricane Rita. It is essential that we take action now to make substantive reforms to the SBA Disaster Assistance Program. We owe nothing less to our small businesses. I ask that you continue working with my office on this important issue and respond to our approach in writing no later than October 31, 2006. This will help us develop a proposal which can address the concerns of the SBA as well as provide a better and more responsive SBA Disaster Assistance Program for our small businesses. Thank you in advance for your assistance with this request. Sincerely, Mary L. Landrieu, U.S. Senator. ____________________