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HAITI: IS U.S. AID EFFECTIVE?

HEARING

BEFORE THE

COMMITTEE ON FOREIGN AFFAIRS 

HOUSE OF REPRESENTATIVES

ONE HUNDRED THIRTEENTH CONGRESS

FIRST SESSION

OCTOBER 9, 2013

Serial No. 113–100

Printed for the use of the Committee on Foreign Affairs

(

Available via the World Wide Web: http://www.foreignaffairs.house.gov/ or

http://www.gpo.gov/fdsys/

(II)

COMMITTEE ON FOREIGN AFFAIRS 

EDWARD R. ROYCE, California, Chairman 

CHRISTOPHER H. SMITH, New Jersey 

ILEANA ROS-LEHTINEN, Florida 

DANA ROHRABACHER, California 

STEVE CHABOT, Ohio 

JOE WILSON, South Carolina 

MICHAEL T. MCCAUL, Texas 

TED POE, Texas 

MATT SALMON, Arizona 

TOM MARINO, Pennsylvania 

JEFF DUNCAN, South Carolina 

ADAM KINZINGER, Illinois 

MO BROOKS, Alabama 

TOM COTTON, Arkansas 

PAUL COOK, California 

GEORGE HOLDING, North Carolina 

RANDY K. WEBER SR., Texas 

SCOTT PERRY, Pennsylvania 

STEVE STOCKMAN, Texas 

RON DESANTIS, Florida 

TREY RADEL, Florida 

DOUG COLLINS, Georgia 

MARK MEADOWS, North Carolina 

TED S. YOHO, Florida 

LUKE MESSER, Indiana 

ELIOT L. ENGEL, New York 

ENI F.H. FALEOMAVAEGA, American 

Samoa 

BRAD SHERMAN, California 

GREGORY W. MEEKS, New York 

ALBIO SIRES, New Jersey 

GERALD E. CONNOLLY, Virginia 

THEODORE E. DEUTCH, Florida 

BRIAN HIGGINS, New York 

KAREN BASS, California 

WILLIAM KEATING, Massachusetts 

DAVID CICILLINE, Rhode Island 

ALAN GRAYSON, Florida 

JUAN VARGAS, California 

BRADLEY S. SCHNEIDER, Illinois 

JOSEPH P. KENNEDY III, Massachusetts 

AMI BERA, California 

ALAN S. LOWENTHAL, California 

GRACE MENG, New York 

LOIS FRANKEL, Florida 

TULSI GABBARD, Hawaii 

JOAQUIN CASTRO, Texas

AMY PORTER, Chief of Staff THOMAS SHEEHY, Staff Director

JASON STEINBAUM, Democratic Staff Director 

(III)

C O N T E N T S 

Page

WITNESSES 

Mr. David B. Gootnick, Director, International Affairs and Trade, U.S. Government Accountability Office ............................................................................. 5

Mr. Thomas C. Adams, Haiti Special Coordinator, U.S. Department of State .. 58

Ms. Elizabeth Hogan, Acting Assistant Administrator, Bureau for Latin 

America and the Caribbean, U.S. Agency for International Development ..... 69

LETTERS, STATEMENTS, ETC., SUBMITTED FOR THE HEARING 

Mr. David B. Gootnick: Prepared statement ......................................................... 8

Mr. Thomas C. Adams: Prepared statement ......................................................... 61

Ms. Elizabeth Hogan: Prepared statement ............................................................ 71

APPENDIX 

Hearing notice .......................................................................................................... 96

Hearing minutes ...................................................................................................... 97

The Honorable Eliot L. Engel, a Representative in Congress from the State 

of New York: Material submitted for the record ............................................... 99

The Honorable Gregory W. Meeks, a Representative in Congress from the 

State of New York: Prepared statement ............................................................ 100

The Honorable Gerald E. Connolly, a Representative in Congress from the 

Commonwealth of Virginia: Prepared statement .............................................. 101

Response from Mr. Thomas C. Adams to question submitted for the record 

by the Honorable Joseph P. Kennedy III, a Representative in Congress 

from the Commonwealth of Massachusetts ....................................................... 103

(1)

HAITI: IS U.S. AID EFFECTIVE? 

WEDNESDAY, OCTOBER 9, 2013

HOUSE OF REPRESENTATIVES,

COMMITTEE ON FOREIGN AFFAIRS,

Washington, DC. 

The committee met, pursuant to notice, at 10:10 a.m. in room 

2172, Rayburn House Office Building, Hon. Ed Royce (chairman of 

the committee) presiding. 

Chairman ROYCE. Last call for members to take their seat, and 

this hearing will come to order. 

Today we meet to discuss the situation in Haiti. In January 

2010, a massive earthquake struck Haiti doing major physical, social, and economic damage to the country that is the poorest country in the Western Hemisphere. It was a devastating blow to a nation already struggling from centuries of violent repression, endemic corruption and from extreme poverty. 

The international community, led by the U.S., rapidly organized 

an unprecedented humanitarian response. International donors 

pledged $13 billion to support immediate relief and recovery. Private charities also provided another $3 billion, and that year Congress approved $1 billion in appropriations for Haiti of which $651 

million was provided to the Agency for International Development 

to support post-earthquake reconstruction. 

Now it is 3 years later, and the results are not impressive. Of the $2 million Haitians impacted by the earthquake, an estimated 

320,000 remain in squalid displacement camps. Efforts to provide 

permanent housing have been undermined by weak property 

rights, unemployment is very high, corruption again is rampant, 

and the business climate is very poor. 

Under the leadership of Chairman Emeritus Ros-Lehtinen, the 

Government Accountability Office was tasked with studying 

USAID’s efforts, and in particular this committee was concerned 

about shelter projects in the development of the Caracol Industrial 

Park in the northern part of the country. As we will hear today, 

the GAO, unfortunately, has found that these programs have been 

slowly implemented, more costly than planned, and of questionably 

lasting impact. While much has been promised, little has been effectively delivered. 

Following this discouraging report, the ranking member and I 

sent a bipartisan delegation of committee staff to Haiti to review 

the GAO’s findings, and they were left asking some basic questions, 

and those questions are why does USAID still lack an engineer for 

the proposed port in the Caracol Industrial Park? Question one. 

2

Question two: Why did the U.S. set expectations for massive permanent housing projects in a country where the overwhelming majority of people do not have secure property rights to begin with? 

And number three: Why aren’t intended beneficiaries occupying the 

few housing units that have actually been built? 

Haiti has suffered too many natural disasters, but it is weak institutions and endemic corruption that perpetuate the poverty of 

the country. The World Bank has found that the chances of reducing poverty under these conditions in the World Bank’s estimate 

‘‘approaches zero.’’

The absence of a transparent, legally enforceable system of property rights—and Hernando de Soto has done a lot of work on this 

issue in Haiti—which would allow Haitians to secure and invest 

capital or open and expand a business, is debilitating. Without 

these basics, no level of assistance would put Haiti on the right 

economic path. 

The Haitian Government’s failure to hold long-delayed elections 

is also troubling. Fully one-third of the Senate in Haiti remains vacant, making a quorum difficult. Even worse, without elections, the 

President may end up governing by decree. 

I believe the Haitian people deserve better. I know American taxpayers deserve better. If aid is to continue, we need a viable partner in development, a viable partner there in democracy. 

And our ranking member, Eliot Engel, was instrumental in 

bringing this hearing together and also in helping organize the 

focus on Haiti, and I am now going to turn to him for his opening 

remarks. 

Mr. ENGEL. Mr. Chairman, I would like to begin——

Mr. Chairman, I would like to begin by thanking you for holding 

this hearing. I have been focused on U.S. policy toward Haiti for 

many years, and I sincerely appreciate your willingness to bring 

this issue before the full committee. 

The January 2010 earthquake in Haiti focused world attention 

on the plight of that country in a new and different way. The international community and especially the United States responded to 

the urgency and the sheer devastation with both generosity and determination. Our post earthquake assistance in Haiti currently 

stands as one of the most significant U.S. aid commitments in the 

world. 

Even before the dust had settled from the aftermath of the earthquake, 150 donor countries and organizations rolled up their 

sleeves and, together with the Government of Haiti, began to craft 

a rebuilding plan. All agreed that this plan would not be business 

as usual, and that it would seek to have a sustained and unprecedented impact on the future of Haiti. The U.S. piece of that plan 

after 3-plus years is the central focus of this hearing. 

Pursuant to a request by me and Congresswoman Ileana RosLehtinen, the GAO issued a report in June of this year that 

reached some troubling conclusions. This committee dispatched a 

staff delegation to Haiti last month to dig deeper into these issues 

and to help us set the stage for this hearing. 

The GAO report is the most recent official statement on United 

States assistance to Haiti. Today’s hearing will provide GAO, State, 

and USAID an opportunity to update and clarify that information. 

3

I will leave it to the GAO witness to summarize the conclusions of 

their report. Suffice it to say that some of their findings came as 

a surprise to many of us in Congress, and it gave rise to some 

tough questions. 

For example, the number of houses to be built with U.S. assistance dropped from roughly 15,000 to 2,649. The estimated number 

of beneficiaries declined from roughly 80,000 to approximately 

14,000. A back-of-the-envelope calculation tells us that the costs 

per unit have doubled and sometimes tripled. 

We now know that the Haitian Government prevailed upon U.S. 

officials to build bigger and better housing. The problem, of course, 

is that this benefited a much smaller pool of people. Even though 

it misrepresented a dramatic change in the terms of reference for 

the expenditure of these funds, Congress was not consulted about 

the decision. Had we been consulted, would we have gone ahead 

with that plan? Who knows. And was it a good decision to devote 

a third or more of earthquake-reconstruction funding to an industrial park, a power plant to run it, and possibly a new port to service it in a part of the country that was largely unaffected by the 

earthquake? 

In terms of process, the GAO report pointed out that the administration has not always provided sufficiently detailed information 

that Congress needs to assess and evaluate our Haiti programs. It 

is my hope that greater transparency in the administration’s execution of these programs for us and for the Haitian people is among 

the changes that result from this oversight effort. 

I will be submitting a series of questions for the record to begin 

to rebuild the reservoir of information on our Haiti programs. In 

addition, we may call upon the GAO to conduct an additional study 

regarding our Haiti assistance. 

Finally, we may look at streamlining—streamlined reporting to 

Congress such as that included in H.R. 1749, the Assessing 

Progress in Haiti Act, introduced by Rep Barbara Lee. And let me 

say I am glad that our colleague is here today with us. 

Another issue I hope we can focus on today relates to how we 

partner with NGOs and the Haitian Government on these programs. On their recent trip, committee staff learned that Haitian 

officials consistently expressed concern that U.S. Aid largely circumvents the Haitian Government. Some say Haiti has become a 

republic of NGOs. The down side of operating this way is that we 

lose the opportunity to strengthen the capacity of the Haitian Government and to increase the ownership of the Haitian Government 

in people. That ownership is a critical ingredient in the sustainability of our system. I understand that there are significant accountability barriers here that must be overcome, but the Haitian 

Government is the essential partner in this effort. 

That said, I must be clear about the Haitian election issue that 

currently overhangs this entire effort. Haitian congressional municipal elections are 2 years overdue. The Haitian Senate is operating 

with 10 of its 30 seats vacant, and President Martelly is claiming 

that the terms of 10 of the Senators end in 2014. The donor community does not agree with this assessment, and I don’t either. 

In any case, if that were to occur, the Haitian Congress would 

effectively be incapable of carrying out its legislative duties, and we 

4

would face the unacceptable prospect of President Martelly governing by decree. 

This matter is already significantly affecting the patience of the 

donor community, and I know it will greatly affect how the U.S. 

Congress approaches our assistance in Haiti. I call on President 

Martelly to find a quick constitutional resolution to this matter and 

hold elections as soon as practicable. 

The threshold question we need to ask today is not whether we 

are on track to rebuild Haiti to a pre-earthquake standard, but, 

rather, if we are helping to build Haiti back better. I hope very 

much that in 2015, when we reach the 5-year anniversary of our 

post-earthquake assistance program, we can answer that question 

in the affirmative. 

So, Mr. Chairman, thank you again for holding this hearing. I 

look forward to the testimony of our witnesses. 

Chairman ROYCE. Thank you, Mr. Engel. 

We now go to Representative Salmon of Arizona, chairman of the 

Western Hemisphere Subcommittee. 

Mr. SALMON. Thank you, Mr. Chairman. 

I would like to commend Chairman Royce and Ranking Member 

Engel for convening this important oversight hearing on Haiti, the 

GAO’s report on aid to Haiti, and the status of the U.S. reconstruction projects and our investment in economic development there. 

Although the rubble has been largely cleared away, I believe the 

Haitian people have a right to be frustrated with the lack of 

progress on reconstruction and for a perceived lack of coordination 

on the part of the international donor community. The GAO’s report was critical in many respects when it comes to USAID overpromising and under delivering on many fronts, and we are here 

today to try to find out why. But I also would like to use my time 

to point out a couple of areas where the bipartisan staff delegation 

reported back some positive findings. 

In particular, I was told that some specific projects regarding 

USAID partnering with the Government of Haiti to provide 

healthcare services in underserved rural areas seem to be working 

quite well. In addition, I heard some exciting agricultural programs 

are being made possible by a unique partnership between USAID 

and the University of Florida that are making a real difference for 

the lives of Haitian farming families and having a positive impact 

in the local agricultural community by trying to bring their farming 

techniques and practices into the 21st century. 

I was also impressed with what I heard regarding the training 

and professionalism of the Haitian National Police and the Government of Haiti’s partnership with our DEA to combat the 

narcotraffickers. 

In conclusion, I would like to add my voice to Chairman Royce’s 

concerning the importance of Haiti going forward with finally holding elections. This is a crucial step that the Government of Haiti 

must take if we are able to count on them as reliable partners 

going forward. Failure to conduct elections in the near term will 

cause many of us to question the use of taxpayer dollars in recovery efforts as we will have little confidence in the Haitian Government. 

5

I look forward to hearing more today and making sure U.S. taxpayer dollars are being spent wisely and most cost-effectively as 

they possibly can in Haiti. 

Thank you, Mr. Chairman. I yield back. 

Chairman ROYCE. Thank you. 

We go now to Mr. Sires of New Jersey, ranking member of the 

Western Hemisphere Subcommittee. 

Mr. SIRES. Thank you, Mr. Chairman. 

Good morning, and thank you to our witnesses for being here 

today. 

The 2010 earthquake in Haiti unleashed an unthinkable amount 

of death and destruction to what was already the poorest country 

in the Western Hemisphere. More than 1⁄4 million people died, 200 

million people were displaced, and ever since, a cholera outbreak 

has plagued the island, and more than 300,000 displaced people remain in camps. 

Through a June 2013 GAO report, we know that the USAID efforts in Haiti have been grossly inadequate and marred by incompetence. Reports submitted to Congress have been untimely and 

shallow. We know little of how money has been spent, and there 

is a failure to recruit appropriate technical expertise when necessary. And amongst the most disturbing accounts is how the 

USAID increased the funding allocated for housing by 65 percent 

while decreasing the projected number of houses to be built by 80 

percent. 

I understand the post-earthquake environment was chaotic, and 

that the Haitian Government has not been entirely cooperative at 

times. Nonetheless, these lapses are unacceptable. USAID efforts 

are an effective and critical component of our foreign policy; however, the accounts outlined by the GAO report undercut these efforts and overshadow our goodwill. At a time when the Congress 

is deadlocked over funding the government, our U.S. agencies must 

do better. Thank you. 

Chairman ROYCE. Thank you. 

This morning we are going to hear first from Dr. David Gootnick, 

Director of International Affairs and Trade at the Government Accountability Office. He has been in that position since 2011. 

Although not a common committee practice, Dr. Gootnick will be 

followed by a second distinguished panel consisting of representatives from the Department of State and from USAID. 

Earlier this year GAO issued a critical report of the administration’s efforts, and I think the format of allowing the GAO to testify 

first is going to give members an opportunity to fully understand 

the GAO’s findings before asking questions of the administration. 

So, without objection, the witness’ fully prepared statement will 

be made part of the record. Members here will have 5 days to submit statements or questions or extraneous materials for the record. 

And we will now ask Mr. Gootnick to summarize his statements. 

And you have 5 minutes, Mr. Gootnick. 

STATEMENT OF MR. DAVID B. GOOTNICK, DIRECTOR, INTERNATIONAL AFFAIRS AND TRADE, U.S. GOVERNMENT ACCOUNTABILITY OFFICE 

Mr. GOOTNICK. Thank you, Mr. Chairman. 

6

Mr. Chairman and members of the committee, thank you for inviting GAO to participate in this hearing. As you indicated, Mr. 

Chairman, today, more than 3 years after the earthquake, nearly 

300,000 Haitians remain in temporary shelter, and nearly 80 percent of the population lives in poverty. 

Roughly 6 months after the earthquake, Congress provided more than $1.1 billion in a supplemental appropriation for Haiti’s reconstruction. USAID is responsible for the single largest share, directly implementing $651 million of this amount. As of June 2013, 

USAID had obligated just over half and disbursed about one-third 

of this funding. 

My statement today updates GAO’s recent report on two of 

USAID’s key activities: First, the construction of the power plant 

and port to support a new industrial park known by its acronym 

CIP in northern Haiti; and second, construction of permanent housing in and around Port-au-Prince, St-Marc and Cap-Haitien, three 

designated development corridors. 

Regarding the industrial park, 1 year after the earthquake, the 

U.S. and Haitian Governments, the Inter-American Development 

Bank, and a South Korean garment maker entered into a public 

private partnership for development of the CIP. Specifically the 

bank was to provide funding to the Haitian Government to construct the park complex; the U.S. Government would build the 

power plant, contribute to building a nearby port, and support construction of 5,000 housing units near the industrial park; and the 

Korean firm would be the anchor tenant with plans to hire 20,000 

Haitian workers. 

AID did complete the initial phase of the power plant in time to 

supply the first CIP tenant with electricity, and as of last month, 

1,500 workers are employed at the park. USAID has funding to 

cover operations and maintenance for 3 years, expand the distribution of power, add solar energy, and increase the plant’s generating 

capacity. 

However, port construction is delayed about 2 years from its 

original plan. In addition, funding for the port is insufficient to 

cover most of the projected costs, and it is unclear whether the Haitian Government will find a private-sector partner willing to cofinance all phases of the project as originally envisioned. 

The lack of a port engineer at USAID’s Haiti mission is an important factor in these planning challenges. After two unsuccessful 

efforts to recruit a qualified engineer, USAID is now working with 

U.S. Army Corps for this expertise. 

Turning to the permanent housing, USAID’s New Settlements 

Program is a response to the severe post-earthquake housing shortage and supports the Haitian Government’s goal of expanding economic activity in areas outside Port-au-Prince. However, USAID’s 

original housing numbers and cost estimates for both site development and home building proved to be optimistic. 

The program’s original goals were for USAID and its partners to 

build 15,000 new homes at a cost of roughly $2,000 per plot and 

$8,000 per house. However, the program is now projected to complete less than 20 percent of the originally planned homes, and 

costs to date are about $10,000 per plot and over $24,000 per 

house. 

7

These shortfalls are due to a number of factors. In particular, the 

initial cost estimates used inaccurate comparisons to earlier 

projects and did not take into account the level of site infrastructure that USAID has designed and built into these sites. To a lesser extent, the Haitian Government’s request for larger and improved houses also increased costs. Problems securing land title 

and donor coordination also delayed construction. 

Most of this housing will be located near the industrial park with 

only 15 percent located in the earthquake-affected area. The residents at the first site have just started moving in, and USAID is 

working to address sustainability risks, such as affordability and 

community development. However, funding for these efforts is limited. GAO’s recent report recommended that USAID hire a port engineer and provide timely community-support mechanisms for each 

new settlement. USAID agreed with both recommendations, and 

we will monitor their progress in this regard. 

Mr. Chairman, this completes my remarks. I am happy to answer your questions. 

[The prepared statement of Mr. Gootnick follows:]

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Chairman ROYCE. One of the questions I would like to ask you 

is, how big a factor was the USAID’s inability in this case to secure 

land titles in moving forward? And I see the project was delayed 

by 2 years, and knowing what we know about property rights in 

Haiti in some of the past discussions we have had about this issue, 

were the goals realistic given the morass of inability to fix title and 

so forth? 

Mr. GOOTNICK. Right. I think there is no question that land titling and land ownership in Haiti is, at best, arcane historically, 

a paper record system at most; that many of the archives that did 

contain what existed of property records were damaged or destroyed in the earthquake. It is worth recognizing that most of the 

government’s structures were literally collapsed in Port-au-Prince 

after the earthquake. Seventeen percent of Haitians, the Haitian 

Government, and civil servants, were killed in the earthquake. And 

probably a third were substantively displaced or left their positions. 

But with respect to land titling, in particular the building of 

homes in Port-au-Prince, I think, was sacrificed by the absence of 

land title, the ability to gain land title, and very limited options for 

government land in the immediate Port-au-Prince area, so that the 

original plan was to build most of the homes in Port-au-Prince, but 

eventually most of the land was available outside. 

Chairman ROYCE. Who in the Haitian Government, if you happen to know, insisted upon the very costly design changes, and 

what was the purpose? What was their purpose? 

Mr. GOOTNICK. I would have to get you the answer on who exactly within the Haitian Government made that request. I do know 

that it came at the ministry level from the Haitian Government, 

and that the interest was for larger homes and to include indoor 

plumbing so that these would be exceptional homes by Haitian 

standards, without question. At this point they are built at approximately 450 square feet, and they are excellent homes that are built 

to a very high standard. 

Chairman ROYCE. Reportedly a few Haitian Senators decided 

they were not getting a big enough—I guess ‘‘kickback’’ would be 

the word to use here—on construction in their districts, and so they 

insisted upon costly design changes. You never know, when you are 

reading these accounts or hearing these accounts, what is behind 

a delay like this, but the argument was that those changes could 

not be justified. And the question, of course, would be did USAID 

roll over in a situation like this and finally concur in order to move 

forward with something that seriously, on the face of it, couldn’t be 

justified? 

And that speaks to the broader issue of the endemic corruption 

and the exposure of U.S. assistance to waste, fraud, and abuse in 

a situation like this. And indeed what can be done to counter these 

types of circumstances where something goes on years longer, Dr. 

Gootnick, than had been intended? 

You look at the cost overruns. We underestimated the cost by 

433 percent per plot, I guess, in your study and then 193 percent 

per house, and the scheduling is 2 years behind schedule. Your observations on that. 

32

Mr. GOOTNICK. Well, the cost escalation occurred really in a 

number of different phases, and this is outlined in our report. The 

initial estimate of $2,000 per plot and $8,000 per home came originally in some of the activity approval documents, the early documents that USAID submitted for review that formed the basis of 

their initial goals and their costs, the estimates of the costs. 

Subsequently USAID got formal independent government estimates, just before letting contracts and found that the cost had 

risen. So that was the first escalation. A second escalation occurred 

when they first got bids back which were found to be actually higher than the independent government estimates. And then finally, 

the Haitian Government’s request for the larger improved homes 

added yet another cost increase. 

I am not specifically familiar with the issue of corruption that 

you mentioned, although it is fair to say corruption is felt to be endemic in Haiti. I will say that one of the features of the rising costs 

would be the interest in using local building materials. I know that 

USAID would have wanted to use local building materials, but, for 

example, with respect to concrete, when some testing was done, it 

was found to be inadequate and would not have proved to be a sufficient home. 

Chairman ROYCE. I understand. 

We will go now to our ranking member Mr. Engel from New 

York. 

Mr. ENGEL. Thank you. Thank you very much, Mr. Chairman. 

In your report you said that USAID and State did not brief Congress adequately. What specifically should or could be done about 

this? 

Mr. GOOTNICK. Right. Our report cited the directive in the supplemental appropriations and the Senate report to the supplemental appropriations which directed State to provide reports to 

the Appropriations Committees and to the Congress broadly every 

6 months for the first 2 years of the supplemental. What we did 

is we went back and looked at those reports and studied the extent 

to which those reports fully complied with the various directives 

and found that the reports were somewhat limited at times in their 

candor and in their thoroughness about the progress and the challenges that were being faced by the reconstruction effort. 

I think it is fair to say that from State and USAID’s point of 

view, in addition to those reports, they would willingly come up 

here and provide information at the request of various Members 

and committees and had briefed on the Hill numerous times. That 

said, we felt that the reinstitution of the reporting requirement 

would assist Congress in its oversight. 

Mr. ENGEL. Thank you. 

How does USAID’s reliance on contractors and NGOs impact the 

effectiveness of USAID in Haiti, in your opinion? 

Mr. GOOTNICK. Yeah. I don’t think USAID could do its work 

without contractors and NGOs in Haiti. I think one of the interesting questions related to your question would be the extent to 

which large either U.S. or multinational nongovernmental organizations versus local organizations could be used. And it is my general understanding that part of the reason the costs escalated for 

these homes was that the prime contractor or the prime builder 

33

USAID wanted to ensure was a fully responsible contractor who 

was going to build according to the standards and specs that they 

had sought, and that does raise the price. 

With respect to the actual digging in the earth and laying of the 

bricks and mortar, I think they have worked as hard as they can 

to identify local NGOs who can hire local labor to do that work. 

Mr. ENGEL. I am going to give you some quotes I would like you 

to comment on. 

After the earthquake, the administration said we must ‘‘do 

things differently’’ and explained that we had to work with the 

Haitian Government ‘‘as partners.’’ It said we couldn’t have a ‘‘scattered array of well-meaning projects,’’ and we needed to ‘‘coordinate 

our aid and hold ourselves accountable.’’

Obviously, I am not sure we have done those things. I would like 

you to comment. 

Mr. GOOTNICK. Right. Well, I recall that immediately after the 

earthquake, when I think the spirit of cooperation and the endeavor to build back and build back better first emerged, there was an 

intention to work as closely as possible and to assist in rebuilding 

Haitian Government capacity to take charge of this rebuilding. And 

the first structure that was developed after the earthquake, something called the IHRC, the Interim Haiti Recovery Commission, 

which was cochaired by the then-Prime Minister of Haiti and 

former President Bill Clinton, was an effort to have the multilateral—the U.S. and the multilateral community—join with the Haitian Government in an effort that ultimately could be Haitian-led. 

Unfortunately, that effort did not yield a highly functioning Haitian Government entity or ministry that could take over development. There has been an effort to restart a similar process just in 

the past 6 months. I don’t—the State Department may be able to 

give you additional information. I don’t believe it has proceeded 

particularly far at this point. 

Mr. ENGEL. What are—the report said, I know, a lot, but if you 

could highlight the major—the major criticism, the major thing 

that jumped out at you, what would that be? 

Mr. GOOTNICK. Well, the first thing I would want to do is put 

this in context that we were asked by yourself and Ms. RosLehtinen to look at two of the key efforts that USAID has undertaken, so the industrial park project and the permanent housing, 

two, arguably, key features, the signature features of the development and reconstruction post earthquake. 

They are by no means the only activities that USAID has undertaken, but with respect to those two key activities, I would say the 

key takeaways for me are, one, there is a tremendous challenge in 

completing the feasibility studies, selecting a site, and then going 

through all the steps that are required to construct a port that 

would be part of the larger apparatus of this industrial park, the 

power plant, the port, the housing units and the complex itself. So 

the first takeaway is the challenges getting that port up. 

The second one is the housing. I think it is fair to say that the 

initial estimates were just too optimistic. That, with the best of intention, there was a goal of 15,000 houses that between land, donor 

coordination, cost of building materials and some weakness in the 

initial estimates were just not destined to come to fruition. 

34

Mr. ENGEL. Thank you. 

Thank you, Mr. Chairman. 

Chairman ROYCE. We go now to Ileana Ros-Lehtinen from Florida, chairman of the Middle East Subcommittee. 

Ms. ROS-LEHTINEN. Thank you, Mr. Chairman, and thank you, 

Ranking Member Engel. 

As we discussed more than 1 year ago on June 22, 2012, thenRanking Member Howard Berman and I requested that GAO investigate reconstruction efforts in Haiti specifically pertaining to 

shelters and development of the surrounding areas of the Caracol 

Industrial Park in Cap-Haitien. Thank you, Director, and thank 

you to your team members who did a thorough job in this GAO report. We commend you. 

I was shocked to read the findings of the report and deeply disappointed that our foreign aid continues to suffer from a lack of 

real, targeted, comprehensive strategy to improve the situation on 

the ground for the people of Haiti. 

While Haiti, unfortunately, remains one of the poorest countries 

in the Western Hemisphere, U.S. taxpayers have been extremely 

generous in providing millions of dollars in foreign aid and humanitarian relief to this Caribbean country. In fact, Haiti is the largest 

recipient of foreign aid in the region; however, it is our responsibility to ensure that these dollars are being spent wisely and are 

showing the impact and the results that are intended. 

While I recognize that the environment in Haiti may be difficult, 

we must do our due diligence in this committee to hold U.S. officials accountable for the mistakes made in Haiti. Over 3 years ago, 

this body acted to provide emergency relief funds for Haiti to help 

the recovery efforts after the earthquake. It is appalling that we 

find out from this GAO report that only 50 percent of the funds 

have been obligated, and a mere 35 percent have been disbursed. 

Mr. Director, why do you think that USAID and State have been 

so behind on getting these crucial dollars out the door? And I am 

going to continue, also, given the fact that no U.S. dollars go directly to the Government of Haiti, do you believe that our government has correctly prioritized relief efforts through reliable NGOs? 

Another alarming finding from your report relates to housing. 

USAID decreased the projected number of houses they anticipated 

from 15,000 homes to now just 2,600 homes. This means that less 

people will be helped, from 75,000 as originally planned to now just 

13,000 people. This translates to less homes for less people at double the cost. This is beyond unacceptable. It is scandalous. 

And lastly, I would like to discuss the report—the port in CapHaitien, as you pointed out in your report. According to the GAO 

report, this port is 2 years behind schedule, may take up to 10 

years in finishing, and, in addition, as of June 2013, USAID has 

yet to fill the position of a port engineer to oversee the project. 

These misguided decisions are reckless and only hinder our ability 

to help the people of Haiti, which is our objective. 

Let me be clear. USAID does not have the expertise, the knowledge, or the background to build this port. Mr. Director, do you 

agree with this assessment? To your knowledge, has USAID ever 

built a port to this scale in the past and been successful? 

35

Mr. GOOTNICK. Thank you, Congresswoman. Let me take a couple of different parts of that. 

I have one figure that I think will perhaps speak to the obligations and disbursements, the other one, because you mentioned, 

Ms. Ros-Lehtinen, that only 50 percent had been obligated and onethird disbursed. 

This is a graphic that shows the timeline of the supplemental 

and the obligations and disbursements. So, on the horizontal axis 

you see time and on the vertical axis you see percent disbursed. 

Way to the left you can see the January 2010 earthquake. Somewhat to the right you see the timing of the supplemental. Then 

what you see is the slow curve upward of obligations and expenditures, and a couple of things to remark about that. 

Money did not start to flow for about 1 year because there was 

some time that was invested in planning and building programs on 

the ground, and then what you see is a steady curve upward over 

the ensuing 3 years now since the supplemental. 

At 35 percent disbursed at 3 years, I would say that a project 

like this, USAID would probably typically think of a 5-year course 

for disbursement, and so I would think they would want to see that 

curve bend upwards somewhat, but they are on a trajectory where 

if, on some of these larger capital projects, outlays increase toward 

the latter part of the project, that they would be able to meet a 

large percentage of the spending within 5 years. So that would be 

a perspective on the obligations and disbursements. 

You asked a number of other things. Let me mention the knowledge on the ports. You are correct that to the best of our research—

and I think USAID concurred they have not built a port of this 

magnitude for many decades, and they did seek the expertise of a 

port engineer—what I think you will hear from them is that the 

challenges recruiting a qualified, highly qualified individual to 

come and live and work in this environment, they had two solicitations they were unable to fill with a qualified person. It may have 

taken them a couple of years to sort that out. At a point here——

Ms. ROS-LEHTINEN. Thank you. I am sorry. I am out of time, and 

I like to be cognizant of that. 

Thank you, Mr. Chairman, for your generosity. 

Thank you, sir, again for an excellent report. We want to help. 

Mr. GOOTNICK. Thank you. 

Ms. ROS-LEHTINEN. We really do. We need to do better. 

Chairman ROYCE. Mr. Gregory Meeks. 

Mr. MEEKS. Thank you, Mr. Chairman. 

Let me ask you, listening to your testimony, it seems as though 

one of the big mistakes that was made early on is the estimates 

that were done on the cost to build the homes, the cost of the port, 

et cetera. Can you—you know, did your study tell us how was that 

so wrong? Because that seems to be causing a lot of the problems 

today because of where we started in the beginning as far as the 

estimates. How did we go so wrong with the estimates? Could you 

give us a——

Mr. GOOTNICK. I think it is very clear with respect to the housing 

that the initial estimates were based on homes that had been built 

in Haiti prior to the earthquake, in part, and that those estimates, 

while they would have formed a reasonable basis for comparison, 

36

were probably used more directly than they ought to have been to 

estimate the price of a home. 

Secondly, I think USAID, as it proceeded through its design, did 

not anticipate the costs that would be incurred to build the site to 

the specs that they have achieved. So, if you think about the complex of homes, they are building roads, retaining walls, putting in 

electricity, putting in a form of a sewage system, building—putting 

in street lights, putting in walkways and the like, and that level 

of infrastructure, to build a community from a greenfield, essentially, I think, was an underestimation of the cost. 

Mr. MEEKS. Now, and just—that was—the other questions I had 

was the infrastructure itself, because when I hear that there was 

a question from the government in regards to indoor plumbing as 

opposed to outdoor plumbing, it just seems to me all of that should 

be—should have been done in the infrastructure, because in my 

mind, in 2013, the best way to do something is to have indoor 

plumbing so that you could have a sewer system. 

That should be—should have been computed in an estimate in 

doing infrastructure, and then the coordination of the funds, because when you have between the Haiti construction fund, the 

USAID money, and then, I don’t know, CAD who—I don’t know 

whether they had coordinated, any of that coordination, so that 

that then gives you, I would think, a better idea of what you are 

doing and how much it costs. 

How did that coordination go, and why then—you know, at the 

beginning stages we were not looking at indoor plumbing as opposed to—as opposed to just having, you know—I can’t even imagine to say having outhouses in 2013. 

Mr. GOOTNICK. I will be honest with you, Mr. Meeks. It is not 

entirely clear to me exactly how the request for indoor plumbing—

where it came from in the Haitian Government, how it was processed by the U.S. Government, and how the U.S. Government came 

to its—how USAID came to the decisions to respond to that. That 

we simply report as having happened. It is a bit of a black box. I 

think USAID, I am sure, and State can answer that for you. I 

would also be happy to try to look into that on your behalf and get 

you an answer. I think it is fair to say that the Haitian Government asked and we agreed to have this improvement built into the 

structures. 

Mr. MEEKS. Let me also ask, I was just looking at what your recommendations were, and I think—I don’t know if you had a chance 

to answer Ms. Ros-Lehtinen’s question, but it says that the GAO 

recommends that we hire a port engineer to oversee port planning 

and construction. Has that been done? 

Mr. GOOTNICK. Right. At the time we issued our report, USAID 

issued its second solicitation for a port engineer, roughly timed 

with the issuance of our report. So they agreed with our recommendation. They indeed proceeded with a recruitment effort. 

That recruitment effort, as I understand it, did not yield a qualified 

individual who was willing to move to Haiti under the circumstances of the job offer, and so they reinvested, I think, in 

working with Federal Government agencies, particularly the U.S. 

Army Corps of Engineers, who have that expertise. 

37

Mr. MEEKS. So then basically you are saying they could not find 

that person, so you are trying to—you go onto plan B since that 

person has not—couldn’t find it, correct? 

Mr. GOOTNICK. I think that is a fair characterization. 

Mr. MEEKS. Okay. And second it says, provide timely community 

support mechanisms for each new settlement to help ensure sustainability of its permanent housing program. Has that been done? 

Mr. GOOTNICK. Right. A little context in that. If you think about 

taking a greenfield and converting that into hundreds of homes, 

and then identifying beneficiaries, and providing them with that 

housing, particularly where employment opportunities may not be 

entirely proximate to the housing development, there are a range 

of community development challenges that emerged. First of all, 

how do individuals pay the rent? What kinds of rents are required? 

Are they building toward ownership? Who runs this community? 

Who is the community—where is the community leadership? 

Where is community structure? What are some of the rules? And 

USAID had funded efforts to obtain services, expertise basically, to 

allow communities to help—to help communities build that kind of 

expertise. 

That has been made available to some of the early communities, 

but we have not been given certainty that there is funding to do 

that in each of the communities that is to be built. We think that 

is important, and it will enhance the sustainability of these communities that are being developed. 

Mr. MEEKS. Thank you. 

Chairman ROYCE. We go now to Mr. Dana Rohrabacher, subcommittee chairman for the Europe Subcommittee. 

Mr. ROHRABACHER. Eurasia and Emerging Threats. That is the 

exact title. 

Chairman ROYCE. That is the full title. You have 5 minutes, 

Chairman. 

Mr. ROHRABACHER. Thank you very much, Mr. Chairman. 

I think that when we are coming to grips with—here in the 

United States with our ever-increasing debt that is—as we all realize it is unsustainable for our own economy, it behooves us to take 

a look at what we are doing as a government and to see if there 

are not ways that we can do things more effectively and efficiently, 

and what we can afford and what we can’t afford to do, and that, 

in particular, deals with how we are dealing with exactly the situations that we are examining today in terms of our assistance to 

other countries. 

I think that, Mr. Chairman, and specifically, we are going to 

have to determine whether the United States can still be involved 

in long-term development, or whether the limited amount of money 

that we have now because of our own debt situation will mean that 

we have got to focus instead on emergency and disaster assistance 

as the essence of American foreign aid as compared to long-term 

development, or especially I don’t think that we can any longer afford ongoing subsidies to foreign governments, especially when the 

foreign government seems to indicate that there are corruption 

problems within that society. 

38

First of all, specifically, the homes that were being built that we 

are talking about here in Haiti, are they owned by the occupants 

of the house? 

Mr. GOOTNICK. It is a good question. What my understanding is 

of the way this will work is, as beneficiaries move in, they will be 

paying, and I think the first settlement is approximately $35 per 

month. 

Mr. ROHRABACHER. To whom? 

Mr. GOOTNICK. To the Haitian Government. 

Mr. ROHRABACHER. To the Haitian Government. 

Mr. GOOTNICK. I would actually want to make sure I am correct. 

Yes, to the Haitian Government. And what that will do is that will 

build toward ownership of the home. Because it is government 

land, they will not in the end own the land, but they will own their 

home, so essentially they are paying the mortgage. 

Mr. ROHRABACHER. So, we are having—we are setting these people up. They don’t really own the home until they have made their 

payments. The Haitian Government may end up owning the 

homes. 

Mr. GOOTNICK. Well, but the homes were built on Haitian Government land. Universally the permanent shelter that is being constructed is, at the end of the day, on Haitian Government land. The 

U.S. Government is the donor of this effort. And I would defer to 

my colleagues at State and USAID, but——

Mr. ROHRABACHER. Sounds like we set up another scenario of 

corruption there, to be frank. And it is one thing for us to—for us 

to have come into this project at all, we should have expected the 

Haitian Government—Mr. Chairman, we should have expected the 

Haitian Government to donate the land to whoever occupied the 

house rather than leave whatever petty bureaucrats in that country who rape their own people with that kind of power over a 

project that we are financing. Anyway, that sounds like something 

we need to pay attention to. 

You know, the Chinese do things a lot differently than we do 

when they have projects like this, but let me ask you. We used—

and are we using local contractors to build these homes? 

Mr. GOOTNICK. We are using a range of partners that are primarily larger NGOs or in some cases multilateral institutions that 

have the capacity to perform as the prime contractor. In turn, it 

is my understanding that a lot of the actual labor is being conducted by Haitians. 

Mr. ROHRABACHER. Okay. So we are giving money to an organization that then doles it out to build the homes that then actually 

the Haitian Government ends up controlling. 

The Chinese, by the way, just so you will know, I am sure you 

are already aware of this, they come in, they don’t do that. What 

they do is they bring in their own workers, their own people, and 

when they—they build a project, and then they leave the project. 

They say, here are the homes, this is what we are giving you, but 

they are not deeply involved with the murky bills of doing business 

in a Third World country where there is so much corruption and 

so much of the money then is wasted through corruption. 

Let me ask you a little bit about the specifics. Well, I have got 

about 9 seconds, but I understand Cheryl Mills, because this was 

39

such an emergency situation and the task was so daunting, that 

she was given certain authority and a vehicle of trying to make 

this work in Haiti that it went out of the normal process the State 

Department uses for such emergency measures. How has that 

worked out as compared to what the normal procedures would have 

done? 

Mr. GOOTNICK. I would have to defer to the State Department on 

that. In general we have been working with the Haiti Task Team 

and the Office of the Haiti Reconstruction Coordinator, USAID and 

State Department respectively. If they are working above that level 

within their own respective departments, I am less familiar with 

that. 

Mr. ROHRABACHER. Well, we are going to have to find better 

ways of how we have limited amount of money now as compared 

to what we have had in the past. Our own country can’t sustain 

the course we are on. We have got to do things better, and frankly, 

there is just as much corruption as there ever has been. 

Thank you very much. 

Chairman ROYCE. We go now to Mr. Sires of New Jersey. 

Mr. SIRES. Yes. Okay. Did you mention before that the houses 

were 450 square feet? Is that what you said? 

Mr. GOOTNICK. Four hundred fifty square feet. Four hundred 

fifty square meters. I will have to get the precise answer for you, 

but my understanding was 450 square feet. 

Mr. SIRES. And this is a request by the government to make it 

that large? 

Mr. GOOTNICK. Yeah. They went from about 200 and—I am going 

to look this up for you, but I believe they went from about 275 

square feet to 450 square feet. 

Mr. SIRES. 275 square feet. That is a room. 

Mr. GOOTNICK. It is a small house. As they are constructed, they 

are a one-bedroom with a concrete pad where the resident, if they 

choose to, could add a second bedroom. So, it is a bedroom, a living 

area, a small bathroom, and a kitchen. 

Mr. SIRES. I mean, I don’t think it is outrageous that the government requested that you make it a little larger and put a bathroom 

in there. I assume that is the reason we agreed to it. 

Mr. GOOTNICK. Again, I am not—I wouldn’t claim to have a great 

deal of knowledge about the discussions that took place between 

the U.S. and the Haitian Government to agree to it. I simply know 

that rather late in the day, the Haitian Government asked for this 

improvement, and the U.S. Government agreed to it. 

Mr. SIRES. And you say they own the land, the government owns 

the land? 

Mr. GOOTNICK. Yes. In all cases there are eight sites that have 

been developed. We have a map in our report that will show you 

the location of the eight sites. One is in the Port-au-Prince area, 

four are around the industrial park, and two are in the St-Marc 

corridor, and in each case, at the end of the day, these ended up 

being on government land. Initially USAID had hoped to work with 

private entities who would donate the land. Part of their—maybe 

a large landholder would donate something in exchange for enhanced value of their own land and the like. My understanding is 

that, at the end of the day, this did not work out. 

40

Mr. SIRES. Do you know if any homes have been built where they 

would own the land? 

Mr. GOOTNICK. The homes are all being built on government 

property, and, as I indicated, they will pay a form of rent where 

after a period of time they will own the home. They will not own 

the land. 

I think that what—my understanding is that between the U.S. 

and the Haitians, there has been some assurances that given the 

vagaries of land ownership and title in this country, that the homeowners have been assured that when they pay their mortgage, if 

you will, and ultimately own that house, that they will have a secure title to their home. 

Mr. SIRES. And the land. 

Mr. GOOTNICK. The best of my understanding, not the land. That 

is correct. 

Mr. SIRES. So no matter what you paid, you still don’t own the 

land that you are there. 

Mr. GOOTNICK. Don’t own the land. Don’t own the land, you own 

the house. 

Mr. SIRES. So if the government ever wanted to do anything and 

take the land, they could basically remove these people. 

Mr. GOOTNICK. Right. It is fair to say that the vast majority of 

Haitians, certainly in Port-au-Prince, do not own—even if they own 

their home, they don’t necessarily own the land. If they are a tenant, they don’t necessarily—their landlord and him or herself 

doesn’t necessarily own the land. Land ownership is obscure, I 

would say, in much of Haiti. 

Mr. SIRES. Can you talk a little bit why you think there were so 

many delays in the reports and the omissions in the report? Is it 

because maybe the—we just didn’t do it right, or the government 

is not a good partnership in this process? 

Mr. GOOTNICK. With respect to the 6-monthly reporting requirement that State Department had, I think it is fair to say that the 

reports emphasized the more positive aspects of the development—

the reconstruction effort, and that we felt that additional candor 

about problems and challenges would give a more rich context and 

more accurate view of what was taking place. 

Mr. SIRES. Do you know if the government is a partner or an obstructionist in all this? 

Mr. GOOTNICK. Haitian Government? 

Mr. SIRES. Yes. 

Mr. GOOTNICK. I would let, again, the agency comment on that. 

Mr. SIRES. You take the Fifth? Okay. 

Thank you, Mr. Chairman. 

Mr. SALMON [presiding]. Thank you. 

Mr. Gootnick, according to your report, USAID will build only 

2,649 of the 15,000 houses originally. And I am just wondering, is 

this an acceptable outcome? I have heard other folks talk about, 

you know, the—why we have had the mistakes in projections and 

everything, but, realistically, could this have been avoided? 

Mr. GOOTNICK. I think it is regrettable that the goal will not be 

achieved or anything like the original goal. I think when you step 

back from the permanent—the question of permanent housing, it 

might be also useful to look at some of the efforts regarding the seVerDate 0ct 09 2002 14:17 Feb 11, 2014 Jkt 000000 PO 00000 Frm 00044 Fmt 6633 Sfmt 6633 F:\WORK\_FULL\100913\85105 HFA PsN: SHIRL
41

vere housing shortage, indeed the disaster around housing that occurred after the earthquake, so that in the immediate aftermath, 

there were a range of efforts, some of which the U.S. Government 

took the lead on, some of which they were a participant in, anything from simply removing rubble to getting some of the—the initial temporary shelter in the camps established, to getting basic 

safety and sanitation in some of the camps, to some of the transitional housing structures that were built, some of the damage assessment in Port-au-Prince that was done. So these are housing-related activities where I think it is fair to say that the U.S. Government played a key role and did achieve some very positive results. 

With respect to the permanent housing, there have been some 

real shortcomings in what they hoped to achieve and what they 

have achieved. 

Mr. SALMON. Also, USAID has committed $170.3 million to construct a power plant and a port to support the newly developed 

Caracol Industrial Park. And according to a recent USAID feasibility study, the park port will cost anywhere between $117 million 

and $189 million, more than the $68.1 million USAID planned to 

invest. 

Is it likely that the Haitian Government or private-sector investors will ever cover the shortfall? And what happens if USAID can’t 

get the additional investment? Would it have been wise to secure 

funding agreements prior to construction? 

And then, finally, USAID has informed the committee it plans to 

hire a port engineering expert by the end of this year. I heard you 

talk about the fact that they haven’t had any responses yet. But 

even if they do get that engineer, would that alone be sufficient to 

cure the problems they are facing, and what else should be done? 

Mr. GOOTNICK. With respect to the shortfall on the funding of the 

port, I think it is important to recognize that USAID’s investment 

was not intended to be the entire investment required to build and 

operate this port. The port is being—has been envisioned as a fourphased project. And right now USAID’s $60-some million that remains in that sector will cover the majority, but I don’t believe all, 

of phase one. USAID I believe hopes that phase one would be 

enough to get the port up and running, although would not have 

the full capacities, obviously, of the completed construction over the 

four phases. 

For the four phases, there is a significant shortfall. And the—the 

effort is to identify someone in the private sector who wants to—

who will invest in the building of the port and then obtain a concession for the running of the port and thus recoup some of their 

investment. 

Mr. SALMON. [Inaudible.] 

Mr. GOOTNICK. I wouldn’t say I am the best person—have the 

best expertise to answer that. 

I would say it would be a large investment, and the private partner would need a concession at the port that was sufficient to recoup their investment. And that is a private-sector calculation I 

couldn’t—I can’t do for you. 

Mr. SALMON. With that kind of a shortfall, would it be prudent 

of us maybe to hold back on that money until there is a successful 

game plan? 

42

Mr. GOOTNICK. Well, I think there is some degree to which the 

port, the power plant, the housing, and the industrial park are 

interdependent. That is not specifically to say that, without the 

port, the other parts of that larger project couldn’t survive. But it 

certainly is standard economic logic to suggest that that port will 

reduce the transportation costs for the industrial park, allowing 

them to expand, hire more folks, provide more wages that will support housing, make more use of the power plant, and support payment for the utilities that the power plant provides. So there is 

some synergy to these projects that I think would make it a greater 

challenge for the larger project to succeed without the port. 

Mr. SALMON. I guess what I was trying to get at, though, is does 

it make sense, if it is going to be that much of a shortfall, would 

you recommend that we don’t spend that $68 million and build 

something that may not be able to be completed? 

Mr. GOOTNICK. We have not made that recommendation. We 

have made no recommendation to halt funding or otherwise withdraw funding. I would say that USAID has already invested a couple years in feasibility, is continuing to invest in feasibility, and 

has real plans to move forward. 

Mr. SALMON. Thank you. 

Mr. Connolly. 

Mr. CONNOLLY. Actually, Mr. Chairman, I would be glad to defer 

to Ms. Bass. 

Ms. BASS. Thank you very much, Mr. Connolly. 

I have a couple of categories of questions I wanted to ask you 

about. One is Feed the Future and the status of Feed the Future. 

But before that I wanted to understand more about the contractors that are used, and not necessarily for building the port, but 

all of the other projects that are going on. I think you said they 

are all NGOs? 

Mr. GOOTNICK. My understanding is that they are nongovernmental organizations; in one case, it is a development bank. There 

are other large actors who are involved in the primary contracting 

to build the homes. 

Ms. BASS. And how do we find the NGOs? You know, are they 

U.S.-based NGOs? International? Haitian? 

Mr. GOOTNICK. Well, the cost of this home is largely the cost that 

is—the funds that are transferred to the builder. The builder then 

has outlays to achieve the project and as an NGO is not in—anticipating meeting a profit, but providing the service. 

Ms. BASS. Right. And I am just trying to get at understanding 

the vetting process and how we hold NGOs accountable, whether 

they are nonprofit or whether they are making profit. How do we 

recruit them, vet them, hold them accountable? 

Mr. GOOTNICK. Right. It is an important question, and I think it 

is a key priority for USAID throughout its entire enterprise. It has 

been a priority of the USAID Administrator to use local NGOs and 

improve capacity of local NGOs wherever possible. 

I think the challenge, which USAID could speak to, is, just as 

you articulate, ensuring that you have a partner there who can act 

accountably with respect to the funding and also provide the service that you have asked them to provide. 

43

Ms. BASS. So from your point of view, though, in terms of the accountability and the vetting, you wouldn’t know; is that what you 

are saying? I know you are not—I know you are not USAID, 

but——

Mr. GOOTNICK. Right. We have done a variety of studies at GAO 

in other parts of our portfolio where we have looked at USAID’s 

oversight of its grants and its contracts. And I think what we found 

is that there is this tension: When you are working with a U.S. 

NGO, you have an enhanced ability to ensure accountability; when 

you are working with a local NGO, you have an opportunity to improve local capacity. And this is a balance and a—and progress 

that USAID is trying to make with its USAID forward, but it faces 

real challenges in this regard. 

Ms. BASS. So ‘‘challenges’’ means there is a method of accountability or——

Mr. GOOTNICK. I would say it is not a one-size-fits-all. You have 

got to look in a case by case. So if you look at Haiti in particular, 

by and large the prime recipient of funding has not been a local 

NGO. I can’t say that without exception across all of the reconstruction effort, but with respect to the projects we are looking at, 

they have not gone directly to the Haitian—Haitian civil society, 

public sector or private sector to do this work. Indirectly——

Ms. BASS. So who have they gone to? 

Mr. GOOTNICK. Haitian laborers contributing to the building. 

Ms. BASS. Got that. I understand that. And I think that is great. 

But who does the money go to? If it is not Haitian NGOs, who 

is——

Mr. GOOTNICK. Well, I mean, there are a number of large NGOs, 

some whom you would recognize. The American Red Cross and the 

like are the types of organizations that are prime recipients. 

Ms. BASS. Okay. And are you able to comment about the status 

of Feed the Future? 

Mr. GOOTNICK. Excuse me? 

Ms. BASS. Are you able to comment about the status of Feed the 

Future in Haiti, the $88 million that has been spent so far? 

Mr. GOOTNICK. You know, I would be happy to take questions for 

you and get back to you on that. I am not our agency’s expert on 

that issue. I certainly know that hunger in Haiti was on the rise 

prior to the earthquake, and it has become more acute and particularly with the cholera epidemic and certain natural disasters subsequent to the earthquake, two hurricanes that have buffeted the island. There have been real challenges. And deforestation is a huge 

problem. 

Ms. BASS. Okay. Well, we could save that for the next panel. 

Thank you very much. 

Mr. CONNOLLY. Mr. Chairman? 

Mr. SALMON. Mr. Connolly. 

Mr. CONNOLLY. I would ask unanimous consent that our colleague Barbara Lee be allowed to participate in this hearing. 

Mr. SALMON. Absolutely. 

Mr. CONNOLLY. I thank the chair. 

Mr. SALMON. Chair recognizes Mr. Marino. 

Mr. MARINO. Thank you, Chairman. 

Over here, sir. Thank you for being here. 

44

Have you or anyone from State, if you can speak to it, any U.S. 

entity or person, discovered corruption, fraud, or theft taking place 

in Haiti on these projects? 

Mr. GOOTNICK. On these two projects I am not aware of any specific charges or findings of corruption. 

Mr. MARINO. Is there an entity or is there a person responsible 

for investigating the potential for corruption? 

Mr. GOOTNICK. With respect to ensuring that both the financial 

and programmatic controls are in place such that the funds are 

being used for intended purposes, USAID is going to have grants, 

or contracts managers, or oversight functions within its—within 

the Office of the Haiti Coordinator—excuse me, within the Haiti 

Task Team within the USAID mission that are looking to ensure 

that the funds are being spent as intended. 

Again, I don’t have any specific observations about corruption or 

lack of accountability on these projects. That said, they are, with 

respect to housing, clearly not meeting some of their targets. 

Mr. MARINO. Do you have access or have you had access to any 

of these reports that may have been put together to determine 

whether the money is going where it is supposed to be going and 

we are getting the product in return? 

Mr. GOOTNICK. You know, that was not a key part of the scope 

of this project, so I would have to honestly say I could look into 

that and get back to you. But I don’t have specific information for 

you. 

Mr. MARINO. Is there a U.S. entity on the ground, for example, 

let us say someone to review initial plans and prints, someone to 

review initial cost; if a load of concrete is coming in, is it the grade 

that was spec’d out, is it being properly laid, are the materials that 

are used to build a house, are they materials that were spec’d out, 

or are they ending up being a lesser quality? Is there anyone that 

reviews this on the ground as the building is taking place? 

Mr. GOOTNICK. Right. In general I think I would point to two 

types of oversight of that kind of accountability challenge. One, the 

initial contractor or grantee is going to be required to provide reports to the—to USAID. And, secondarily, at the USAID mission 

there is going to be oversight of those reports and—and then that 

information that comes forward. 

The inspector general is also—the regional inspector, again, 

based in El Salvador has done a lot of work on the ground in Haiti. 

But the general accountability and oversight, the general controls 

for those projects are—tend to be managed within the USAID mission. 

Mr. MARINO. So you stated that—previously that much of the 

labor is and should be the Haitian people, correct? 

Mr. GOOTNICK. That is my understanding, yes. 

Mr. MARINO. Now, if an individual, a business person, man or 

woman, in Haiti has a construction—has a cement company, is 

there someone—is there ever a situation where a representative 

from the United States is on the ground making sure that the 

product that is on site is the product that we originally paid for? 

Mr. GOOTNICK. Right. Well, I mean, concrete is a good example 

because it is my understanding that in these building projects 

there has not been sufficient information to suggest that locally 

45

procured building materials are satisfactory. And so part of the escalation of costs is the importation of a lot of the building materials 

to satisfy the demands for quality. 

Mr. MARINO. Don’t you think, then, there could be a cost savings, 

there could be time savings if there is actually a representative of 

the U.S. as a project manager on site making certain that we are 

getting what we pay for, or a series of managers? 

Mr. GOOTNICK. Honestly, Congressman, I think that is a question 

I am going to have to let you direct to USAID. I don’t have the answer for you. 

Mr. MARINO. I have 30 seconds left. Can you again expand on a 

little bit how is private—what is USAID doing and what is your 

conception of more private enterprise getting involved in projects 

like this? 

Mr. GOOTNICK. Well, the port itself is an effort to build a publicprivate partnership as to say for USAID to partially fund the port 

after feasibility studies have been done, designs have been completed, and to identify what would be a large—in Haitian terms, 

a very large investor to contribute to completing the port and becoming the concessionaire. So there is one example. 

Mr. MARINO. I see my time has expired, and I want to keep within my 5 minutes. Thank you, Doctor. 

Mr. SALMON. Mr. Vargas. 

Mr. VARGAS. Thank you very much, Mr. Chair. Appreciate the 

opportunity. 

I have to say I was much more scandalized before I got here, because now that I am here, I think some of the answers—some of 

the questions have been answered. I looked at the 15—that you are 

going to build 15,000 homes. That was the original. But turns out 

that that was a pie in the sky, that those numbers were way off, 

one; and, two, that you were looking at building them in Port-auPrince where it would be infill as opposed to raw construction. So 

infill is a lot cheaper. I think any of us who have worked in the 

business know that. So infill would have been a lot cheaper, but 

because the property wasn’t secure, you couldn’t get simple fee title 

there, you had to build somewhere else, so you have to put in the 

infrastructure. 

Then secondly, interestingly, the houses were going to be 275 

square feet. Just so you understand what that is, a house of 15 

times 18 feet is 270 square feet. The average family size of a Haitian family is four people. So you are going to put four people in 

a room of 15 by 18. So someone came up with the outrageous idea 

that they should put them instead in a room of 21 by 22 square 

feet. 

I know that area well because a few years ago I built my garage. 

That is how big my garage is. So somewhere the scandal is that 

you are going to build a house the size of an American suburban 

garage to put in four people, and the outrageous thought that they 

might have a bathroom. 

You know, my daughter spent the last two summers, the summer 

before last summer, in Nicaragua, up in a place called Los Lipes, 

way up in the jungle, and she didn’t have a bathroom, which I was 

grateful for because now she doesn’t complain at home, a 16-yearold. And this year she was in Paraguay for the summer working 

46

for Los Amigos de Las Americas. Again, they didn’t have a bathroom, it was about 100 feet away, which, again, was fantastic. So 

she does not complain at home again about any of the issues we 

have. 

But the notion that we couldn’t build a bathroom for these people, I think of course we should. You know, we are there to help. 

And the other thing I guess I was thinking was this. You know, 

we—this is a 7.0 quake that they had, and they lost—go through 

the statistics—they lost so many people. We had a 7.2 3 months 

later in Baja, California, about 100 miles from my house. In fact, 

I thought it was the big one, and I grabbed my 6-year-old daughter 

and was running out the door because I thought, oh, hell, this is 

the big one. But it turns out it was 100 miles away. We had four 

people die, only four people. We had, you know, some damage. We 

didn’t have hundreds of thousands of people; we didn’t have that 

kind of damage. 

So you don’t want to build houses that are so cheap that they are 

going to fall down again. That would be stupid. So we build these 

houses, you know, little tiny ones. People get in there, they fall in 

them. Whose fault? It is our fault. You know, so I—the scandal 

that I thought I was going to have and beat you up on kind of got 

answered, just to be frank. 

So I—I guess I would—I would just ask a little bit more about 

the issue of that port, because the home one kind of got answered 

for me. But the issue of the port. It is very difficult to build that 

kind of infrastructure, it is difficult to get an engineer there. How 

is that going to be worked out ultimately? 

Mr. GOOTNICK. Well, I think what—what USAID is thinking at 

this point is there is an increased recognition that the time needed 

to design and build a port was longer than was originally put forward in the activity approval document and the U.S. strategy. So 

I think there has been a rethinking of just the time horizon necessary do something of this scale. 

Mr. VARGAS. Okay. And the other thing I guess that I thought, 

I thought more money had actually been spent on the project. A lot 

of the money still hasn’t been spent——

Mr. GOOTNICK. Right. 

Mr. VARGAS [continuing]. Right? So they still seem to have the 

ability to pay for these things, Right? 

Mr. GOOTNICK. Well, some of the money that is projected to go 

into the port and some of the money that is going into this housing, 

the vast majority of it is from the supplemental. There are some 

funds that are being contributed from annual appropriations, ESF 

appropriations, that have plussed up some of these over time to ensure there is enough funds to do the—to do the work. 

Mr. VARGAS. Thank you. I yield back. Thank you, sir. 

Mr. SALMON. Thank you. 

Mr. Weber. 

Mr. WEBER. Thank you. 

Dr. Gootnick, you are the Director of International Affairs and 

Trade at the GAO. How many employees are in your particular department? 

47

Mr. GOOTNICK. The International Affairs and Trade team is 

about 120, 125. GAO-wide we are, with downsizing, under 3,000 

now. 

Mr. WEBER. But I am most interested in the department that has 

oversight of what we are discussing here today. One hundred twenty under your supervision? 

Mr. GOOTNICK. No, no. One hundred twenty in the group as a 

whole. We work in a matrixed effort and work with staff across a 

number of different engagements. 

Mr. WEBER. And how about under your supervision? 

Mr. GOOTNICK. Well, to do this work, for instance, there would 

have been three or four of us over time. 

Mr. WEBER. Three or four of us over what time period? 

Mr. GOOTNICK. This work was done over the course of about a 

year, okay, but not by any means full time by all of those individuals. 

Mr. WEBER. So we are—Congress has appropriated this money. 

Are you telling me that three or four individuals are responsible for 

watching all that goes on over in Haiti——

Mr. GOOTNICK. No——

Mr. WEBER [continuing]. As it relates to this project, this relief 

effort? 

Mr. GOOTNICK. No. I think we respond primarily to requests 

from committees of jurisdiction, and also respond to mandates or 

directives that are put in legislation. So when the supplemental 

was established, we were asked to do work, and this is our third 

report. In addition to GAO, you are going to have the inspector 

general doing work based out of El Salvador, and then you are 

going to have the internal oversight of the program itself. 

Mr. WEBER. So all in all would you say there is 10 American—

or, I guess, government employees watching this process? Twenty? 

Thirty? 

Mr. GOOTNICK. I would have a hard time trying to put that kind 

of a number on it, sir. I would say that there are different parts 

of the oversight community that are brought to bear on——

Mr. WEBER. So safe to say it would be a good move for us to try 

get a particular number, somebody who has accountability and responsibility for oversight in its entirety. 

When you say the inspector general from El Salvador—I am 

looking at a map here—I can’t help but notice that the Dominican 

Republic is immediately east of Haiti. You have got Puerto Rico, 

British Virgin Islands, Jamaica. Of course, it is southeast of Cuba; 

looks to be, I don’t know, 20 or so miles maybe. Are all of these 

countries helping in any form or fashion? 

Mr. GOOTNICK. Well, the—the inspector general at USAID was 

provided $5 million, I believe—I will check to make sure that is 

correct—in the supplemental appropriation to provide oversight of 

these funds. So there is one way in which the oversight of the 

project was resourced, if you will. 

GAO does not operate in quite the same way. We are not looking 

for a directed appropriation for a specific project. We operate with 

our annual appropriations to try to respond to congressional interest——

48

Mr. WEBER. Okay. Let me move on just a little bit here. Do you 

have any knowledge, is the Dominican Republic, Puerto Rico, Jamaica, and others, are they helping with the relief effort? 

Mr. GOOTNICK. Many countries have been involved. I can speak 

to the largest donors. None of those, I think, fall within the very 

largest donors. Puerto Rico obviously part of it. 

Mr. WEBER. Okay. You also mentioned that there was a South 

Korea garment facility, I think, in your comments? 

Mr. GOOTNICK. Right. A very large South Korean firm was a key 

part of the public-private partnership that was the genesis of this 

industrial park. 

Mr. WEBER. Have they invested money? 

Mr. GOOTNICK. Sure. They are operating a—they are operating 

a firm. They are producing clothing and shipping it to the United 

States as we speak. 

Mr. WEBER. Do we have sufficient safeguards in place that they 

won’t use what we would—is tantamount to either slave labor or 

child labor? 

Mr. GOOTNICK. It is an important question. I think it has been 

looked at. There is a minimum wage in Haiti, which is $5—approximately $5 a day, as I understand it, and they are being paid 

at minimum wage. I can’t speak directly, but I am certainly aware 

through—through press and other sources that labor conditions are 

being observed and monitored. 

Mr. WEBER. Okay. Let me just comment on the 450-square-foot 

homes. When I was in the Texas Legislature, my wife and I are 

RVers, recreational vehicle owners, and we travel and camp. I have 

a 40-foot Fifth Wheel that is 8 feet wide. It is 320 square feet. It 

sleeps 12 people. Wouldn’t want to live in it full time if I didn’t 

have to. But I can’t tell you how much—and I did for 6, 5 months 

out of each—every other year in the Texas Legislature. But I can 

tell you that you make do with what you can. 

And I lived and we have had kids live in the 320-square-foot area 

for a week or 2 at a time. It is not the most optimal, but, you know, 

a grateful people, of course, ought to say 450 square feet with a 

bathroom would be just tremendous. So I just want to make that 

comment. Thank you, Doctor. 

Mr. GOOTNICK. And I would just add for the record that if you 

look at studies of the poor in Haiti, there are many studies that 

show that of the—of those in extreme poverty in Port-au-Prince, 

the amount of square footage that you have to sleep, you may literally need to sleep in shifts because there aren’t—there isn’t 

enough square footage for people to lie down. 

Mr. WEBER. Thank you very much. 

Mr. SALMON. Mr. Bera. 

Mr. BERA. Thank you, Mr. Chairman. 

Thank you, Dr. Gootnick, for your testimony. Let me just look at 

some of the numbers. Six hundred fifty-one million dollars was 

what was allocated for housing; is that correct? 

Mr. GOOTNICK. Six hundred fifty-one million dollars was allocated across USAID’s entire portfolio in a supplemental appropriation. 

49

Mr. BERA. Okay. Great. And the goal was 4,000 new homes, and 

then leverage that with 15,000 plots, and again leverage it for 

11,000 additional homes. 

Mr. GOOTNICK. Correct. 

Mr. BERA. Is that correct? 

I found Mr. Vargas’ comments actually very interesting. We are 

not talking about large dwellings; we are talking about, you know, 

by U.S. standards, you know, very small dwellings and very small 

shelter. But what worries me is, looking at our briefing materials, 

is it correct that 54 percent of the population lives on about $1 a 

day? 

Mr. GOOTNICK. Yeah. I think of it as 70-plus percent live on $2 

or less, so some subset of that is going to live on $1 a day. 

Mr. BERA. So it almost—you know, again, as I am thinking about 

it, you know, as we have questioned USAID and interacted with 

USAID, we are almost addressing issues at U.S. standards as opposed to looking at it in capacity building from Haitian standards. 

You just commented on, you know, the square footage that, you 

know, is available for a vast percentage of the population having 

to sleep in shifts. More a comment as opposed to a question: I just 

wonder if there is a better way to leverage the funds to impact a 

larger percentage of the population, and I would be curious as to 

your thoughts, and it may be a question better for the USAID 

folks. 

Mr. GOOTNICK. I would only comment that this is a population 

that has lived in deep and endemic poverty for many, many decades. And so how you reach a high percentage of those citizens 

with scarce dollars is probably the challenge that our development 

agencies struggle with every day. 

Mr. BERA. But we are talking about pretty large sums by Haitian 

standards in terms of the amount of aid that was raised and, you 

know, even the amount of dollars that Congress allocated. It seems 

as though a fairly large amount and a very poor country that is 

going to address a small segment of the population as opposed to 

really going after root-cause issues to try to develop some systematic change to actually address the folks that probably were most 

impacted by the earthquake as well, which I would imagine the 

poor were disproportionately impacted. 

Mr. GOOTNICK. I think with respect to the housing, that is a very 

fair criticism, that at the end of the day, a relatively small number 

of individuals will be beneficiaries. I think in fairness to the program effort it has to be looked at in the context of other—of the 

activities that related to shelter in the immediate aftermath and in 

the months and years that ensued that don’t end up yielding permanent housing, but maintain people’s roof over their head for 

some period of time after a huge natural disaster. 

Mr. BERA. And if I look at some of what is in our briefing, Haiti 

also has one of the largest wealth disparities in the world with 68 

percent of the total national income accruing to the wealthiest 20 

percent. 

I have to also believe that, you know, in construction and land 

ownership and so forth, with the level of corruption, I am worried 

that some of those dollars that we are investing also disproportionately are benefiting the wealthiest as opposed to leveraging those 

50

dollars to benefit the folks that are most affected. Would that be 

a fair——

Mr. GOOTNICK. Yes. Haiti, I think, in—is one of the most inequitable society—government—countries in the world. And there is 

plenty of academic literature to suggest that the more inequality, 

the harder it is to achieve development outcomes. 

Mr. BERA. I have got about 45 seconds left. One other thing, in 

a prior hearing in this full committee, in terms of promoting democracy, promoting fairness, one of our witnesses said one of the 

keys is land ownership, is property ownership, even if it is a small 

plot, to give you something and give you a stake in the game. And 

if I understand correctly, land ownership is very rare, and property 

rights are very rare. Is that—that is correct in Haiti? 

Mr. GOOTNICK. Yes. I would characterize it as obscure and arcane. But I think it is fair to say that in many cases it is not clear 

who owns land that an individual or group of individuals may be 

living on, and in all likelihood, with respect to being able to actually claim full title to land, it is a very small number of large landholders. 

Mr. BERA. So I would suggest—and I am out of time—but one 

way to perhaps start fundamentally changing and putting in the 

seeds of democracy and stability would actually be looking at that 

rule of law and looking at that land ownership. We can’t mandate 

that, but, again, if there is a way that we can leverage our resources to try to put in some of that rule of law and some of those 

land ownerships. That is just a comment, not a question. 

Mr. GOOTNICK. And if I could just remark, I think that is a very 

important comment, and there are programs through this reconstruction effort that are trying to get at that we, GAO, did not look 

at and may be a good topic for discussion with the subsequent witnesses. 

Mr. BERA. Thank you. 

Mr. SALMON. Mr. Perry. 

Mr. PERRY. Thank you, Mr. Chairman. 

And, Dr. Gootnick, thanks for coming. I understand and recognize that you are not a representative of USAID, you are GAO. So 

this is frustrating to listen to, quite frankly. And I know you don’t 

have all the answers, but you are the person in front of us right 

now. 

And being a proponent of foreign assistance, and we have a lot 

in America, so we have a lot of responsibility, and these folks are 

our neighbors, and we should help. But it is hard to advocate to 

my constituents, the taxpayers who are paying the bill, who are 

willingly paying the bill, but say, you know, we want to get the 

most out of our dollar, and you are sending it here, and we are obviously not. 

And I wonder, what are the systems of accountability? I mean, 

I see this report from the GAO, the Government Accountability Office, and the answer is kind of like, well, more reporting to Congress will help. More reporting of bad information to Congress 

won’t help. What will help is either the same amount of reporting, 

more reporting, or less reporting of good information, of things that 

happened where we got the most bang for the buck. But more reporting is not going to change that. We are just going to be unVerDate 0ct 09 2002 14:17 Feb 11, 2014 Jkt 000000 PO 00000 Frm 00054 Fmt 6633 Sfmt 6633 F:\WORK\_FULL\100913\85105 HFA PsN: SHIRL
51

happy with the results. So what are the current systems of accountability for the money that is being spent? 

Mr. GOOTNICK. Well, I think with respect to our recommendation 

for reporting, we cited not only the end of the reporting requirement under the supplemental, but the quality of the reporting that 

came forward during the supplemental. And just as you implied, it 

would be more helpful in Congress’ oversight to the extent that the 

reporting that was provided gave a full and accurate picture of the 

progress, but also the challenges and shortcomings of the effort 

that had taken place. 

With respect to the accountability and oversight broadly, as I 

think we have discussed, there are a range of mechanisms that 

seek to get at oversight and accountability of government expenditures in this kind of environment. 

Mr. PERRY. They don’t seem to be working, in my estimation, 

based on what I have heard. And I don’t know if I am getting partial information, but these statistics, if we—if we live by them in 

our personal lives at home, we are going to build this many houses, 

and we are about a third of that for the same amount of money, 

and somehow we would accept that as okay, we would not accept 

that. We would not accept that anywhere here. Somebody’s head 

would be on a platter. 

Who in—is there one point of contact? Is there one person at 

USAID that is responsible for this project? Who is at the top? 

Mr. GOOTNICK. I think that would be the Office of the Haiti Coordinator would be the first place you would want to go. 

Mr. PERRY. All right. So I would recommend to the committee 

that that person come—come to this committee and give us a report. I——

Mr. GOOTNICK. I think he is your next witness. 

Mr. PERRY. Is he? Good. That would be great. That would be 

great. So get ready. 

You know, I almost don’t know where to start. I mean, it seems 

to me when you are living in a cardboard shack in a tropical country, having a 450-foot home—arguably, it is a—it is a probably a 

square cinder block or concrete structure with a roof over the top 

of it, and maybe a window, a couple windows and a door. If you 

are used to living or you have been forced to live in a cardboard 

home with a mud floor, with an open sewer out front—because I 

have been to some of these Third World countries, not particularly 

to Haiti, but I have been to other environments that are similar—

it is a great step up to move into 450 square feet of concrete, enclosed, roof-covered domicile where you cannot be subject to the 

bugs and the environment, and you can move on with the rest of 

your life. 

And it seems to me that that should have been our primary 

focus. And if I found a contractor in my own hometown and said, 

I want to build a development of X amount of houses, they would 

know immediately. This is open ground. We are not talking about 

tearing down the city and building new—we are talking about an 

open field. We just start digging and putting stuff in. You don’t 

need a sidewalk the first day. You don’t need running water the 

first day. You need a place to put your stuff and get out of the 

weather. 

52

That is what we should be focusing on. And it is appalling to me, 

and I think it would be appalling to most citizens, that that is not 

what we are focused on. And I beseech you as the GAO representative for us, that is what you should be focusing on; not the efficacy 

of reporting, the efficacy of getting something accomplished for the 

best bang for the buck. 

I gotta tell you, I am disappointed in this. This isn’t going to tell 

us, well, you are going to report more to Congress. La-di-da. That 

is great. It is going to be the same, we failed to provide, we failed 

to spend the taxpayers’ money wisely. That is what we are going 

to be hearing more of. 

Should I be—this is rhetorical, but should we be happy with 

this? What can you do? Is there something that we are not doing 

to empower you more? How can we help you help us? 

Mr. GOOTNICK. Well, I think I need to think about that question 

before I give you an off-the-top answer. But in general I would say 

that, you know, sunlight is helpful. That is to say the more something is observed is, the more likely it is going to be accountable, 

it is going to be more transparent, and you may get more for the 

investment. 

Mr. PERRY. Thank you, Mr. Chairman. Thank you. I yield. 

Mr. SALMON. Mr. Connolly. 

Mr. CONNOLLY. Thank you, Mr. Chairman. 

And before I begin, I would ask unanimous consent that our colleague, the gentlelady from California Maxine Waters, also be permitted to participate in this hearing. 

Mr. SALMON. Without objection. 

Mr. CONNOLLY. I thank the chair. 

Dr. Gootnick, how often have you been to Haiti? 

Mr. GOOTNICK. I have been to Haiti twice since the earthquake, 

and a couple of times prior. 

Mr. CONNOLLY. Okay. Just personally, on a scale of 1—zero to 

10, in that time period have you seen some progress? How would—

what—assign it a number. 

Mr. GOOTNICK. Well, the first time after the earthquake that I 

visited Haiti was about 6 months, right about the time of the supplemental appropriation, just after. And what you saw at that point 

in time was, in Port-au-Prince, rubble that had been only partially 

removed. So the challenge of removing the rubble, I think, is something I could not have envisioned until I was there 6 months later 

and then observed the scale of rubble that still existed, where main 

thoroughfares were a maze, trying to get around piles of rubble 

that hadn’t literally been removed, but had just been moved, and 

rubble was not simply removed, but was moved from place to place 

before it could be ultimately removed to its final location. 

Mr. CONNOLLY. And to what do you ascribe that? I mean, there 

have been other disasters. The tsunami, for example, almost a decade ago, devastating parts of Sri Lanka, Indonesia, and that corner 

of the world, and yet recovery certainly—you know, rubble was removed. You said——

Mr. GOOTNICK. I would say the density of the infrastructure in 

Port-au-Prince, the quality of the infrastructure in Port-au-Prince, 

and the level of dysfunction in the city, the unworkable city that 

53

it—I think many people would say that it had been prior to this 

disaster. 

Mr. CONNOLLY. Can we just focus on that a little bit, the dysfunction in the city? In various questions you have indicated that, 

you know, home—ownership, land ownership, which creates stakeholders in a community, is fairly rare actually among ordinary people; is that correct? 

Mr. GOOTNICK. Yes, I think it is rare. And most people—most people who live in—at $2 a day or less, and even those who live 

in better circumstances, are renters. 

Mr. CONNOLLY. Would you describe a vibrant civic life existing 

in Haiti before or after the earthquake? 

Mr. GOOTNICK. Yes. I would say one of the things that is impressive about Haiti is the vibrancy and resiliency of the citizenry. 

Mr. CONNOLLY. And the government, functional? 

Mr. GOOTNICK. I would say the government has faced many challenges and has been seen to be a corrupt government for a long 

time. 

Mr. CONNOLLY. You were just asked questions about oversight 

and accountability. Is the problem that USAID adopted good, heroic metrics that, just upon reflection, were unrealistic in terms of 

meeting its goals and disbursing its—its funding? 

Mr. GOOTNICK. Right. I think the goal of 15,000, which originally 

came, as I have said, in both the activity approval document, which 

was the first sort of project document submitted, and also in the 

U.S. Government strategy for Haiti that was issued about a year 

after the earthquake, was—probably grew—in retrospect grew out 

of a spirit of wanting to make this better and wanting to do the 

maximum amount that the U.S. Government possibly could to 

achieve a better outcome for Haitians. So it was overly optimistic. 

Mr. CONNOLLY. Mr. Chairman, I understand the time limitations. 

And I—first of all, if I can suspend my time for a second, I would 

also unanimous consent that the gentlelady from New York, Yvette 

Clarke, also be allowed to participate in this hearing. 

Mr. SALMON. Without objection. We will go ahead and allow all 

the noncommittee Members to ask questions and speak after the 

second panel. 

Mr. CONNOLLY. Is that agreeable? 

I thank the chair. 

Mr. SALMON. Thank you. 

Mr. CONNOLLY. I was going to actually defer to my colleague Barbara Lee to give her an opportunity because she came here first. 

So I now would yield to my colleague, the gentlelady from California Ms. Lee. 

Ms. LEE. Thank you very much, Mr. Chairman. And thank you 

for giving us the opportunity to participate with you today in this 

hearing. I served on this committee for over 10 years, and with 

Chairman Hyde and Chairman Lantos, and I am glad to see it still 

remains bipartisan, given the—what we are dealing with here. So 

thank you again. 

Just a couple questions on this. As it relates to the report, I—

and also the legislation, Assessing Progress in Haiti, and some of—

and your presentation really reaffirms the need for this legislation. 

And I wanted to know, if you have had a chance to look at it, what 

54

your suggestions would be, and also just wanted to ask you in your 

report you mentioned that .4 percent of the funds so far that have 

been allocated went to domestic Haitian NGOs and businesses. 

Have you drilled down a little bit on that to find out what the reason is for that and how that can be addressed? And we will ask 

USAID that question also. 

Mr. GOOTNICK. Right. With respect to 1749, the legislation that 

you sponsored, because a large share of that contains a directive 

for GAO to do work, as is our practice, we have reached out to your 

staff and staff of some of the other cosponsors of the legislation and 

had, I think, very good discussions about those parts of that directive to us that we think would—we would be—we could most effectively accomplish. 

Particularly those things that pertain to U.S. programs or activities, we believe that the first part in particular of the directive to 

GAO in 1749 is something that we would be eager to pursue. When 

you are looking at the extent to which Haitian—Haitian civil society, Haitian actors have been involved in the process and the relationship amongst those different entities, it is harder for us, because we are—it is not a direct look at a U.S. program and activity 

for us to give you satisfactory answers to some of those questions. 

It relates to our audit authority and our access authority. We have 

made that clear to your staff, and I think we are looking at some 

maybe revisions in that regard. 

The other thing is you have outlined a project there that I think 

we would not be able to responsibly do in a 6-month time window. 

So we would look for additional time to do that. 

Ms. LEE. Thank you. 

Mr. CONNOLLY. Mr. Chairman? 

Mr. SALMON. Yes. 

Mr. CONNOLLY. I am guilty of an oversight. I was so dazzled by 

the hat, I overlooked, and I regret my oversight. I would also ask 

unanimous consent that our colleague, the gentlelady from Florida 

Ms. Frederica Wilson, also be recognized for participation in this 

hearing. 

Mr. SALMON. I welcome all our noncommittee colleagues who are 

here today based on their long-standing interest in Haiti-related 

issues. And although the House and committee rules only entitle 

noncommittee members to nonparticipatory attendance, I ask 

unanimous consent that they also be allowed to question the witnesses after all committee members, both majority and minority, 

have had their opportunity to do so after the second panel. 

Mr. CONNOLLY. I thank the chairman. 

Mr. SALMON. Okay. Mr. Yoho. 

Mr. YOHO. Thank you, Mr. Chairman. 

Dr. Gootnick, I appreciate your being here. And I want to start 

off with kind of agreeing and disagreeing with Ms. Ros-Lehtinen in 

that the American people are very generous, they are very giving, 

very charitable. I agree 100 percent with that. But giving to foreign 

aid, I disagree with that, especially if our money is going, and it 

is not accountable, it is not being held accountable. 

We hear it all the time from our constituents, you know, stop the 

foreign aid. And, you know, I know a certain amount of that is necessary, and we will probably continue that. But to throw good 

55

money on top of bad, nobody wants to do that, and I know you guys 

don’t either. So I am going to kind of reiterate, and I feel a lot the 

way Mr. Rohrabacher feels about it. If we are going to go in there, 

we should have American workforces in there. 

And some of my questions are going to be along the lines of what 

you have already heard. Who is running that country? Who is in 

charge of that country? 

Mr. GOOTNICK. Well, Haiti has had a storied political past. Right 

now there is a President who was elected, Martelly. 

Mr. YOHO. President Martelly. 

Mr. GOOTNICK. Yes. 

Mr. YOHO. I mean, the report I have right here in front of me, 

I mean, it says Haiti is a hellhole. Not the people; the people are 

great, the country is beautiful. It is the government, the corruption 

that has been there for the last 30, 40 years that has kept those 

people repressed. It has—it has prevented the growth of that economy, and it is a corrupt government. 

So Dr. Martelly is in charge. He is the President. The former 

government, is it a democracy? 

Mr. GOOTNICK. Mixed presidential-parliamentary system, where 

there is a Prime Minister and a bicameral legislature. 

Mr. YOHO. In your opinion, how stable do you think it is? 

Mr. GOOTNICK. Well, there have been in the past, since the 

earthquake certainly, challenges to holding—fully holding elections 

that are considered legitimate and also to form a government. 

So——

Mr. YOHO. And the next election is in 2015? 

Mr. GOOTNICK. You said the last election. The election—the election of President Martelly was, I believe, the first time that there 

had been a peaceful transition from one President to another of a 

different party. It has occurred within the same party; this was a 

transition to a different party. That was marked by a lot of fractiousness in terms of the President’s ability to appoint a Prime 

Minister. 

Mr. YOHO. Okay. 

Mr. GOOTNICK. And that took a better part of a year, and some 

of the Prime Ministers have not——

Mr. YOHO. In your opinion, how efficient is that government as 

far as doing the basic fundamental needs that a government should 

provide to their country? 

Mr. GOOTNICK. Well, I can speak better to the capacity constraints of the civil service. 

Mr. YOHO. Okay. 

Mr. GOOTNICK. I think the civil service there is weak. It is not 

always paid or paid properly and on time, and that is a situation 

that is a setup for corruption. 

Mr. YOHO. Okay. 

Mr. GOOTNICK. And at the same time there is—like many places, 

while there is an educated cadre, there is a lot of brain drain, and 

many of the most educated individuals in Haiti are coming to the 

United States and Canada and elsewhere. 

Mr. YOHO. Right. I am from Florida, so I am aware of that. 

Let me ask you this: They have a Constitution; right? 

Mr. GOOTNICK. Yes. 

56

Mr. YOHO. And that Constitution, does that provide for individual property rights, to own property? 

Mr. GOOTNICK. You know, you——

Mr. YOHO. Does the government acknowledge that? 

Mr. GOOTNICK. I would have to look into that and get you an answer. 

Mr. YOHO. If you could give me an answer, I would love that. 

Now, along those lines, you were talking about these houses 

around 4-, 450 square feet. Do you know on a cost estimate per 

house what we are paying for that? 

Mr. GOOTNICK. Yeah. At this point the cost of the—a plot is about just shy of $10,000. 

Mr. YOHO. For a house. 

Mr. GOOTNICK. That is for the plot, and the house itself about 

the 23-——

Mr. YOHO. I thought you said the government owns the land. 

Mr. GOOTNICK. The government owns the land. 

Mr. YOHO. So why is it costing $10,000? 

Mr. GOOTNICK. The cost of the plot is really the cost of the site, 

the land on which all of the homes in the community are being 

built, divided by the number of homes. So the cost of a plot is the 

prorated share of the road, the grading, the retaining walls. 

Mr. YOHO. Okay. Let me stop you there. If we are paying $10,000 for a plot that has a 450-square-foot house, that is $200 a square 

foot building costs. I mean, that is outrageous in a country that 

they are paying $5 a day for labor? And then those people have to 

pay $35 a month to rent a house they don’t even own? 

That whole system is wrong, and for us to throw money on top 

of that would be like building a great ocean liner and loading it up 

with all the things you need in the ocean liner, but having an incompetent person running that. And that would be the government. 

And so for us to continue to do that, I just can’t find—until we 

change the government and the way—I don’t want to change the 

government. But until we have a more accountable, to throw 

money on something like that is just—we have already spent half 

of $651 million, roughly? 

Mr. GOOTNICK. Obligated that amount, yes. 

Mr. YOHO. To continue that at this point in time in our economy 

when we are furloughing people, we can’t have our parks open, is 

just unconscionable to the American people. And for us to continue 

this, to keep Haiti in that kind of a deadlock to where they are not 

going to grow out of that economically, I think we need to rethink 

this whole process. 

And I appreciate your time here, and I yield back. Thank you. 

Mr. SALMON. Thank you. 

Mr. Sherman. 

Mr. SHERMAN. It is interesting to have you say that paying your 

civil servants on time is a sign of competent government. 

How has the U.S. Government shutdown affected our activities 

in Haiti? 

Mr. GOOTNICK. I think—I would ask you to direct that question 

to State and USAID. I can tell you that with respect to GAO, to 

the oversight that we are able to do, our routine oversight has been 

shut down. 

57

Mr. SHERMAN. This hearing is about aid, but trade is more effective. I would hope that you would respond for the record what we 

could do to import less textiles from China and more from Haiti. 

Whether that would involve declaring China a currency manipulator, which has the additional advantage of being true, or using 

the old textile quota system to allocate less to China and more to 

Haiti, what we could do to give Haiti access to the U.S. markets 

on more favorable terms. I don’t know if you have any preliminary 

comments on that. 

Mr. GOOTNICK. Well, you are outside my area of expertise a little 

bit, but I can tell you that the two pieces of legislation, the socalled HOPE Act and the HELP Act, which are trade preferences, 

in one case for Haiti, in another case for the broader Caribbean, 

are important tools of U.S. policy that have encouraged exports 

from Haiti and elsewhere in the Caribbean, particularly in the area 

of textiles. 

Mr. SHERMAN. But that was not a circumstance where we reduced imports from China; we just increased exports from the Caribbean.

With that, I would like to yield to the gentlelady from California 

Maxine Waters. 

Ms. WATERS. Thank you very much. 

I have wanted to get into our concerns about Haitians being able 

to participate in the opportunities that are present for redevelopment. I spent some time in Haiti looking at this question, and I 

took a look at the information that is put out in proposals and 

found that none of that information is in Creole, that some of the 

requirements of the USAID contracts are such that it requires certain kind of experience that you know that Haitians do not have. 

And I have been looking for more joint ventures so that Haitians 

could, you know, realize, you know, income from USAID projects 

and be able to improve their communities and create jobs. 

So why is it you have not been able to provide the kind of assistance, technical and otherwise, to Haitians so that they would be 

able to respond to these requests for proposals or participate in 

joint ventures? 

Mr. GOOTNICK. I think that is a good question perhaps to direct 

to State and USAID. I think one of—as we were discussing earlier, 

this is a balance. When funds are moving through a U.S. firm or 

a U.S. large NGO, you have more assurances and more ability to 

ensure accountability. On the other hand, it is a priority in development to try to empower and to provide—have services provided 

by the local—local service providers, local NGOs, local civil society 

and firms wherever possible. 

Ms. WATERS. If I may, the Haitians will never be able to provide 

you with the kind of experience that would be required in these 

proposals unless you do more joint venturing and require that of 

major corporations to do check training and bring people into those 

proposals in ways that they can learn and they can eventually respond themselves. But you have no requirements anywhere, and 

then you don’t have the language in the proposals. So really you 

don’t have a program, USAID. Really you don’t have a way by 

which you are empowering Haitians to do business with you. 

58

Mr. GOOTNICK. Right. As GAO as the oversight entity, that is 

something we could look into on your behalf. But as the implementer, I think you need to direct that question to USAID itself. 

Ms. WATERS. Oh. All right. Whoever would like to respond. Okay. 

Thank you. Okay. 

I yield back the balance of my time. 

Mr. SHERMAN. One more question would be what can we do to 

analyze the issue of whether we need to provide more quantity of 

housing or more quality of housing? Is there an argument to be 

made, or are we pretty much building the type of housing that 

meets minimum standards and tries to make a dent in the overall 

demand? 

Mr. GOOTNICK. Right. I think that is a really excellent question, 

and I am not sure I can answer it, but I would add one more dimension to it. That is to say in addition to quality versus quantity 

or size versus cost, I would add location. So if you look at the initial plans where housing would be built, there was more of an effort to build houses in the earthquake-affected areas. That turned 

out to be a particular challenge, and most of the housing is being 

built outside. So I would look at where as well. 

Mr. SHERMAN. Thank you. 

Mr. SALMON. Thank you very much, Dr. Gootnick. We appreciate 

your testimony, and we would like to excuse you and seat the next 

panel. 

Mr. GOOTNICK. Thank you. 

Mr. SALMON. In September 2010, Thomas C. Adams was named 

Special Coordinator for Haiti by then-Secretary of State Hillary 

Clinton. Mr. Adams’ career with the U.S. Government has spanned 

more than 35 years, with much of it focused on managing foreign 

assistance. 

Thank you for being here. 

Elizabeth Hogan is the Senior Deputy Assistant Administrator 

for USAID’s Bureau of Latin America and the Caribbean. Previously she served as the Director of the agency’s Haiti Task Team, 

overseeing reconstruction efforts after the 2010 earthquake. 

We will now ask our witnesses to summarize their statements, 

beginning with Mr. Adams. 

STATEMENT OF MR. THOMAS C. ADAMS, HAITI SPECIAL 

COORDINATOR, U.S. DEPARTMENT OF STATE 

Mr. ADAMS. Thank you, Chairman Salmon, members of the committee. Thank you for this opportunity to appear before you with 

my colleague Beth Hogan from USAID to discuss the U.S. Government’s engagement with Haiti with a particular focus on our foreign assistance. I welcome the chance to provide a brief overview 

of where we are in those efforts, to describe next steps, and to answer your questions. With your permission, I would like to submit 

my full testimony for the record and make a brief oral statement. 

The ties that link the United States and Haiti are broad and 

deep. Following the devastating January 2010 earthquake, an estimated one out of two U.S. households made some contribution to 

relief efforts for Haiti. Congress, likewise, was quick to respond to 

that country’s needs, appropriating $1.3 billion in supplemental 

funding. Even. 

59

Before the earthquake in 2009, this administration was conducting a whole-of-government review of U.S. engagement in 

Haiti—with Haiti to help put the country on a more solid and sustainable foundation. The result was a new tack, focusing on economic development and growth and encouraging decentralization. 

This approach mirrors that of the Government of Haiti in its postearthquake reconstruction plan. 

So where do things stand now in helping Haitians build a better 

future? Clearly there is still much to be done. To be frank, we all 

hoped we would be further along by now. Nevertheless, there are 

signs of progress in Haiti, reasons to consider the glass half full, 

if you will, and we are not finished. 

It is worth bearing in mind the point at which Haiti started. The 

2010 earthquake traumatized a country already facing uphill struggles. And like the country’s population as a whole, Haiti’s weak 

governing institutions were left shocked and reeling from the 

earthquake, and as a result, crucial decisions to recovery were 

often deferred or delayed. 

Furthermore, 2010 was an election year in Haiti. In March 2011, 

Michael Martelly was elected after two rounds of voting as President of Haiti. He entered his office in May of that year on a pledge 

to speed up Haiti’s rebuilding. 

Overdue elections are a current concern in Haiti, with nearly all 

municipal offices and one-third of the Senate seats expired. The 

Haitian executive and legislative branches have yet to agree on the 

timing and the scope of these overdue elections. We, along with 

other donor countries and international institutions, including the 

Organization of American States and the United Nations, have 

urged the President and Parliament to reach agreement, and we 

remain engaged on this important issue. 

Besides the effect of the earthquake, Haitians’ resilience was also 

repeatedly tested over the past 3 years as the country experienced 

an outbreak of cholera, suffered a significant drought, and was buffeted by hurricanes and tropical storms. Under all these circumstances, Haiti has perhaps made about as much progress in its 

recovery as history might lead one to expect. 

No one would deny that much remains to be done in Haiti, but, 

as I said, there is progress to report. If you visited Haiti today, you 

would remark on the virtual absence of earthquake rubble, and 

that camps for internally displaced persons, which used to take up 

every square inch of free space in Port-au-Prince, are dramatically 

reduced in size and number. 

While focusing our assistance on the most pressing humanitarian 

needs immediately following the earthquake, we have also made 

headway against broader systematic challenges. We currently provide approximately 50 percent of Haiti’s population with access to 

health care. With our help, the Government of Haiti is taking increasing ownership of this system. 

The key to sustainable improvement in Haiti lies not in the generosity of donors, but in the creation of economic opportunity. 

There is not enough donor money to fix everything wrong in Haiti. 

U.S. Support for Haiti’s Caracol Industrial Park is one example of 

our comprehensive effort to help Haiti attract investment and to 

create needed jobs. Congress, through the HOPE, the HOPE II, 

60

and HELP Acts, has helped to make Haiti a more attractive place 

to invest with 8,000 new apparel-sector jobs created since 2007 in 

Caracol and the other industrial parks. 

Agriculture is another area where our efforts to boost economic 

opportunity are yielding significant results. Our agricultural programs are benefiting some 100,000 farmers, hoping to increase crop 

yield, create new markets, and boost farmer income. 

Building durable Haitian institutions remain a priority of the 

U.S. and other donors. Without good governance, economic growth 

in Haiti is built on unreliable foundations. We speak plainly and 

often with Haitians about the need for new laws and reforms to 

strengthen the rule of law and improve the business climate, and 

we complement these discussions with programs to help the Haitians advance these priorities, including providing specialized expertise to Parliament and funding an integrated financial management system for the Government of Haiti. 

With strong U.S. support, Haiti, in 2012, took a significant step 

toward judicial reform with the establishment of a Superior Judicial Council, a new body that will provide independent oversight of 

the judiciary and to which we are providing technical support. We 

are working to build capacity in the Haitian National Police, providing equipment, uniforms, food, and other essential supplies for 

new police cadets. 

I have been describing the progress that U.S. assistance has 

helped Haiti achieve in its effort to rebuild, but I do not mean to 

minimize the challenges still ahead. Make no mistake, it will take 

many more years to make the kinds of far-reaching and lasting improvements we all wish to see in Haiti. Toward that goal, we need 

to maintain an open and frank dialogue with the Haitians and 

focus on how we can help that country’s institutions build their capacity to be effective providers of basic services to the Haitian people. 

To a very real degree, that type of progress cannot move more 

quickly than the Haitians are capable of taking on, but I take a 

positive view of this challenge and believe that our continued longterm commitment, the United States is helping Haiti’s Haitians to 

achieve a better future. 

Thank you, Mr. Chairman. 

Mr. SALMON. Thank you. 

[The prepared statement of Mr. Adams follows:]

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Mr. SALMON. Ms. Hogan. 

STATEMENT OF MS. ELIZABETH HOGAN, ACTING ASSISTANT 

ADMINISTRATOR, BUREAU FOR LATIN AMERICA AND THE 

CARIBBEAN, U.S. AGENCY FOR INTERNATIONAL DEVELOPMENT 

Ms. HOGAN. Mr. Chairman, Ranking Member Engel, and members of the committee, thank you for the opportunity to appear before you today. I appreciate the committee’s interest in USAID’s efforts in Haiti. I, too, have submitted a written testimony for the 

record and will proceed with a short opening statement. 

Nearly 4 years after the earthquake, we have seen notable success across our portfolio. We have helped boost the income of smallscale farmers, whose crop yields sharply increased from USAID’s 

interventions. We have helped fund shelter solutions for more than 

328,000 formerly displaced persons. To accelerate the job-creating 

potential of the private sector, we are assisting financial institutions to provide small businesses with access to credit. And according to the latest demographic health survey, health indicators, particularly for women and children, have improved dramatically over 

the last 5 years. 

Central to the U.S. Government’s assistance strategy in Haiti is 

a commitment to doing business differently. As we implement our 

program, USAID is building the capacity of key Haitian institutions, like the Ministries of Health, Finance, and Agriculture. Our 

goal in Haiti, as in the rest of the region, is to strengthen local capacity to the point where the country can lead and finance its own 

development. 

In addition to partnering more closely with the Haitian public 

sector, we are tapping into the resources, markets, and technologies of the private sector. For example, we are working with 

Coca-Cola and the local Heineken subsidiary to improve the productivity and incomes of small-scale farmers. 

We also launched an innovative business plan competition that 

provides matching grants to small businesses to expand their operations and create jobs. One of the winners is a Haitian entrepreneur who founded a recycling company that works to clean up 

public spaces while providing extra cash to over 6,000 Haitians 

who turn in discarded bottles. He was able to expand his operations, collecting, compacting and shipping nearly 300 million plastic bottles for further processing last year alone. 

But ultimately, donor and private-sector resources will not solve 

Haiti’s development challenges, which is why building the capacity 

of government institutions is so critical to our long-term success. 

USAID is helping to strengthen local municipality’s efforts to raise 

revenues to pay for basic services. In the Carrefour municipality, 

for instance, USAID supported a program to help increase tax collection, and between 2011 and 2012, they increased their tax revenues by 481 percent in just 1 year. 

Over the years our programs and approach have improved 

thanks to extensive consultations with Congress, Haitians, civil society and the diaspora community. As such, we welcome the scrutiny and recommendations of the GAO. We are pleased that the 

70

GAO acknowledged that we completed the power plant for the 

Caracol Industrial Park on time and under budget. 

The GAO report also examined the construction of a new greenfield port. According to the U.S. Army Corps of Engineers and 

other agencies with port expertise; planning, and designing a new 

port can take up to 5 years. We are on schedule to complete the 

planning and design work in that timeframe. 

To address a GAO recommendation, we are finalizing an agreement with the Army Corps of Engineers to embed a ports advisor 

in our Haiti mission. 

In regards to the GAO comments on our shelter program, we acknowledge that we face challenges meeting our original expectations. Construction costs significantly exceeded the initial estimates. These initial estimates did not adequately address the cost 

of meeting international building codes, Federal building standards, disaster resistance standards, and underestimated the rising 

of cost materials in a post-disaster setting. The Government of Haiti’s design changes also added to the increased cost. Other factors, 

such as complications in clarifying land title and reduced donor 

participation, also led to construction delays and reduced housing 

estimates. 

We are working to ensure that USAID-funded settlements are 

sustainable and do not slip into disrepair. To mitigate these risks, 

and in line with the GAO’s recommendation, we are funding community development programs to ensure proper maintenance and 

sustainability. 

It is important to note that Haiti faced large-scale housing shortages even before the earthquake; therefore, new housing construction was never considered to be the sole answer to meeting Haiti’s 

housing needs. Looking forward, we are working on a full range of 

approaches that will provide shelter solutions to many more than 

the 328,000 beneficiaries we have reached so far. 

For example, we are partnering with Haitian financial institutions to stimulate a local housing finance market. We are also piloting a program in an informal settlement to help residents access 

loans for housing repairs and construction of new homes. 

In conclusion, I want to thank Congress for its generous support 

of our work in Haiti. USAID is committed to keeping you informed 

on our progress as well as our challenges as we move forward. 

Thank you again for this opportunity to testify, and I look forward 

to your questions. 

Mr. SALMON. Thank you. 

[The prepared statement of Ms. Hogan follows:]

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Mr. SALMON. I would like to direct my questions to Mr. Adams. 

The United States has invested hundreds of millions of dollars 

in Haiti in the form of aid, and governments of both the U.S. and 

Haiti encourage American enterprise invest in Haiti. However, we 

do not have a bilateral investment treaty that would provide U.S. 

investors an assurance of fair treatment in that country and afford 

them international arbitration of disputes with the Haitian Government. Bilateral investment treaty was negotiated by the U.S. 

and Haiti in 1983, but it has not yet been ratified. Isn’t it time to 

put that treaty in place? 

Mr. ADAMS. That is an excellent point, and I have had discussions with my colleagues in the United States Treasury Department, who, as you know, negotiate those, and encouraged them to 

do it. And the simple answer is that Treasury prioritizes, because 

of lack of resources to do all of these at once, to the largest trading 

partners, and Haiti being a relatively small one, they are down the 

list. But I will certainly convey to them your interest in seeing this 

one moved up the line, and I agree with it. 

Mr. SALMON. Well, as we continue to invest U.S. taxpayer dollars 

in supporting Haiti’s reconstruction, we have also got to make sure 

that the Haitian Government is creating an environment that allows the private sector to play a role in the country’s development. 

Is the Government of Haiti providing a level playing field to our 

foreign investors, to American investors? 

Mr. ADAMS. That is a very good question. I think the answer is 

generally yes. Haiti does allow for international arbitration in contracts, and it abides by the ruling of international arbitrators. And 

given the state of Haiti’s judicial system, investors are reluctant to 

trust the Haitian courts to resolve commercial disputes, so that is 

one way to get around it. 

So, yeah, I do think—I do think American firms have a level 

playing field. An American firm just won the largest contract I 

think, the Government of Haiti has given out recently in rebuilding 

the port in Port-au-Prince for some $70 million. 

Mr. SALMON. Members of the committee have received some reports of an American company, Trilogy International Partners of 

Bellevue, Washington, that has been put through a 1-year ordeal 

by Haitian tax authorities in a process that has lacked transparency and does not appear to be grounded in the due process of 

law. Can you provide an update on that situation and what treatment of Trilogy says about the investment climate in Haiti? 

Mr. ADAMS. Yeah, I talk to Trilogy quite often on this. And I 

can’t go into too much detail because of confidential business information, but our Economic and Commercial Section of the Embassy 

has been actively engaged with Trilogy and with other U.S. firms 

who have disputes there, and all I can say is I think the differences 

between the Government of Haiti—this is a tax issue basically—

have been narrowed considerably, and I think that one—I think we 

can resolve this with a little more time. 

Mr. SALMON. Appreciate anything you could do. 

Mr. ADAMS. Thank you, sir. 

Mr. SALMON. I yield back, and I recognize Mr. Engel. 

Mr. ENGEL. Thank you. Thank you very much, Mr. Chairman. 

78

Let me—let me, first of all, welcome both of you. I want to also 

welcome our colleagues who are not members of the committee, but 

each of whom have interest and a lot of good work behind them 

through the years involving Haiti: Ms. Waters, who certainly has 

worked hard on the issue; Ms. Lee, who we mentioned before, who 

has been relentless in doing it; Ms. Wilson, who has the largest 

Haitian American community, I believe, of any community, any district in the country, in her Florida district; and of course, Yvette 

Clarke of my home State of New York, the largest Haitian community of New York. 

So, welcome. We are all united and care very, very much about 

what goes on in that island and the responsibility. 

I have so many questions to ask you, both of you, that I can 

hardly get it in in the allotted minute, but let me say this. In my 

opening statement I made reference to the fact that Haitian authorities are feeling left out of the decision-making process as well 

as the implementation process of our assistance. Among the goals 

of our assistance program, we have tried to resolve the capacity 

problems in the Haitian Government, because obviously they remain our indispensable partners in doing this. 

Can you, both of you, please describe the current capacity of the 

Haitian Government to decide upon and implement aid programs? 

Have efforts to improve the capacity of the government been successful? Are other governmental and nongovernmental donors 

going around the Haitians or working closely with them? 

Ms. Hogan, why don’t we start with you. 

Ms. HOGAN. Thank you very much for that question. 

As I said in my opening statement, we are doing business differently in Haiti, and we are not working around the government. 

Rather, we are embedding advisors in key government ministries 

in order to help them develop the infrastructure, both governance, 

procurement, management information systems, merit-based staffing, et cetera, so that they can ultimately get to the point where 

they can manage without the need for external assistance. 

I think we are seeing results already. For example, they have an 

integrated financial management system that we have now seen 

through the Ministry of Finance that connects up all government 

ministries’ budgets so that it will provide for the first time control 

and transparency of Government of Haiti expenditures. 

That is a very important first step; however, we have a long way 

to go. One of the things we would like to ultimately be able to do 

is work government to government and fund government agencies 

directly. I think we are further advanced with the Ministry of 

Health than we are anywhere else, because along with the World 

Bank, USAID has been working with them for several years now 

in developing their internal systems, but we are still, as I say, a 

ways off before they are going to be able to account for every dollar 

that is invested. We are on a path, we are not there, but we are 

heading in the right direction. 

Mr. ENGEL. Thank you. 

Mr. Adams. 

Mr. ADAMS. Let me just add one thing to that. What you describe 

usually takes the form of the Government of Haiti asking us to provide budget support; i.e., funding directly the Government of Haiti 

79

while they are running it through contractors and grantees. And 

they had a meeting of their first—their first meeting of their new 

coordinating mechanism, which they are in charge of, and on the 

margins of that, we reached agreement, donors and the Government of Haiti, because they ask this of all donors, that we will support measures to increase governmental transparency there, because that is our biggest complaint. And the reason we don’t give 

money directly to the Government of Haiti is because we don’t have 

any assurances that it will be accounted for accurately. 

The Prime Minister took this up. He has appointed very good 

people on this, and 2 months ago we kicked off this transparency 

initiative, and hopefully—the two biggest complaints we have on 

transparency is they don’t audit government expenditures and income, and the other complaint is they don’t prosecute people for 

public corruption. So I think those are sort of two benchmarks that 

we want to work with them on resolving. 

Mr. ENGEL. Thank you. 

Our first witness is from the GAO, and according to the GAO report, of the 15,000 houses originally planned, only 2,649 are expected to be completed—that is really not good—with USAID building 906 houses and NGOs and other partner donors estimated to 

build 1,743. In addition, cost estimates were widely off base, over 

300,000 percent. 

So can you break this down for us, and what caused the changes 

in the overruns, and looking forward, what are the key issues that 

have been learned regarding this issue, and what changes and improvements do you plan to make? 

Ms. Hogan. 

Ms. HOGAN. Thank you very much for your question. 

Actually our housing numbers have been revised slightly since 

the GAO report was submitted to you, and we are now estimating 

that we will build 3,100 homes. This is in part due to cooperation 

that we have had with the American Red Cross and the Government of Qatar, that have also given us resources to build houses 

on the sites that we will develop for them. So, in total, we will 

build 3,100 homes, and we have another 533 plots that have been 

serviced and are ready and available if other donors or if other buyers want to come in and build homes there. 

Mr. ENGEL. But why were we so off——

Ms. HOGAN. Right. 

Mr. ENGEL [continuing]. On the estimates of how many homes 

we would build and what the cost would be? 

Ms. HOGAN. Thank you. 

We were significantly off in terms of what our original estimates 

were. We based that on a survey, a very quick survey, we did in 

the middle of the crisis when we were trying to stand up our new 

strategy of what NGOs spent in building homes in Haiti, and at 

that time it was roughly $10,000 a home. 

When we got on the ground and were able to do our own government independent cost estimate, that number doubled, and so we 

realized early on that our estimates were off. Then when we put 

the procurement out to bid and got back bids from offerors who 

were going to actually build these homes, the estimates were increased even further. 

80

Again, it is because of the requirements that we put into our solicitation document that it meet international building codes, comply with Federal building standards, and that these materials 

would be disaster- and hurricane-proof. We also required that they 

insure their workers and that they provide safety equipment to 

their workers. These are higher standards that we are accountable 

for as a U.S. Government than would be local actors, and so all of 

that increased the cost of those individual homes. 

And what we realized, as we were going into this and that we 

would only be able to afford the 3,100 new homes, is that new 

homes isn’t the solution for Haiti. The solution for Haiti is helping 

to generate a local housing finance market so that people can access microloans to either improve their homes, or to expand their 

homes for rental opportunities, or to build new homes. 

We have had an excellent experience in one community in Portau-Prince called Ravine Pintade, where we were able to rehabilitate 620 houses by investing about $8.5 million there. We were 

able to help them build retaining walls, improve their drainage, improve their sanitation, helping them do rainwater harvesting, and 

also develop footbridges, streets, lighting, et cetera. 

So, we see that neighborhood reconstruction is really the way to 

go forward to be able to reach the numbers, in fact, beyond the 

numbers than we would have reached through single-family housing. 

Mr. ENGEL. Can you come to Congress and brief us on this program, because I think it would be very, very important. And I 

know I am way over my time, Mr. Chairman, but I just want to 

ask one question. 

One of the primary obstacles to reconstruction is secure land tenure, and how has USAID prioritized this issue to ensure the security of U.S. investments and the long-term development in Haiti? 

Ms. HOGAN. Thank you for the question. 

Let me begin by saying that the land tenure situation in Haiti 

is more a political problem than it is a technical problem, and the 

Haitians need to take the lead in revitalizing a land tenure system. 

We are prepared to help them, but they need to take the tough political choices in order to be able to move forward. 

What we have done, however, is, through a local coalition of 

housing organizations, helped for the first time develop a booklet 

that is both in French and Creole that explains how one legally acquires land title in Haiti. This has never been written or done before there. This is why you have two or three or five people who 

all have title to the same land, because depending which notary 

you go to, you will get different advice. So at least now we have 

transparency established and a very clear line that has been accepted by all of the stakeholders as the way in which one goes 

about securing land title in Haiti. So it is a big step forward, but 

there are big political decisions to make as well. 

Mr. ENGEL. Thank you, Ms. Hogan. 

Thank you, Madam Chairman. 

Ms. ROS-LEHTINEN [presiding]. Thank you, Mr. Engel, and thank 

you to our witnesses. 

I guess it takes much more U.S. taxpayer dollars to be wasted 

for a Member of Congress to call it a scandal. In the 2010 suppleVerDate 0ct 09 2002 14:17 Feb 11, 2014 Jkt 000000 PO 00000 Frm 00084 Fmt 6633 Sfmt 6633 F:\WORK\_FULL\100913\85105 HFA PsN: SHIRL
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mental, $651 million was allocated to USAID to support, relief, and 

reconstruction efforts. Three years later, just 35 percent of these 

funds have been spent as delays mount and goals are scaled back. 

In Fiscal Year 2011, $370 million was allocated to Haiti programs, 

but yet only a little more than half, $194 million, has been distributed to date. In Fiscal Year 2012, $351 million was allocated, and 

only $90 million has been disbursed. 

This backlog of funding and the amount of money left in the 

pipeline for Haiti is in the hundreds of millions of dollars, and I 

am concerned that the team in place cannot handle the oversight 

over these crucial funds. This amount of money should give us the 

necessary leverage to help even more people in Haiti. The American people deserve better, and, more importantly, the Haitian people deserve better. So, yes, colleagues, this is a scandal. 

I recognize that our work in Haiti continues to be a challenge, 

and the conditions on the ground are not easy. However, the narrative of let us blame the Haitians for our own faults needs to stop 

now. As representatives of USAID and State, your agencies are in 

charge of U.S. taxpayer dollars that are being used in Haiti. The 

findings in the GAO report were alarming, and to make matters 

worse, Congress and specifically members of this committee were 

not consulted nor briefed over these serious deficiencies in our programming. 

When it comes to the port, for example, the project is seriously 

delayed. We do not have a private-sector partner at this time. We 

do not even know what the final cost will be, yet the success of the 

north industrial park is dependent upon the completion of the port. 

The administration estimated that the park would produce 20,000 

to 65,000 much-needed jobs. It is discouraging that not even 2,000 

Haitians are employed at the park at the moment. 

Moving on to the housing shelters, I am concerned about the 

plumbing situation at the housing settlements because it has more 

than doubled the cost of these homes. If not maintained well, we 

risk endangering the health of the very people that we are trying 

to help in these communities. 

In addition, I am concerned with the families in these settlements, whether they own the houses we have talked about. They 

own the house, but not the land. The land is owned by the Haitian 

Government. What mechanisms do we have in place to stop the 

government from overtaking these homes? And, Assistant Administrator Hogan, what specific changes in your office are you making 

to fully comply with all of the GAO recommendations, or do you not 

agree with some of the recommendations? 

I am also concerned about the security situation in Haiti. While 

the U.N. Stabilization mission in Haiti is planning on shutting 

down their operations, more emphasis needs to be given to the Haitian National Police, known as HNP. I am very pleased that Secretary Brownfield and the INL, which handles the narcotics and 

law enforcement at State, has partnered with our very fine MiamiDade police department in helping to train the Haitian National 

Police, the HNP. To this date, more than 60 HNPs have been 

trained in south Florida, and I hope more to come. 

The security situation has to be stable in order to hold free, fair, 

and transparent elections in Haiti. It is so disappointing that local 

82

and senatorial elections in Haiti have been delayed for more than 

2 years, and I urge the President of Haiti to call the Haitian Parliament back into session to agree to an electoral law and schedule 

elections as quickly as possible. 

Let me be clear. Ruling by decree or dissolving Parliament is not 

acceptable. Can you provide us with an update on the elections? 

What are we doing to foster civil society engagement? 

And lastly, private businesses are very worried that the Haitian 

Government is not abiding by its obligations to promote fair business practices. U.S. companies have grievances against the Government of Haiti. Special Coordinator Adams, given the fact that U.S. 

investors are already reluctant to invest in Haiti due to uncertainty, can you please describe what the business environment is 

right now for Haiti and for U.S. businesses operating in Haiti? 

Thank you. Thank you. 

Mr. ADAMS. Sure. I will start. I think there were four or five 

questions in there. 

On the business climate, the Government of Haiti has come out 

and said Haiti is open for business. We want to get business, but 

they have done precious little to really make Haiti open for business in the sense that a number of key laws need to be passed by 

Parliament. The Haitian Parliament has been singularly unproductive this last year, passing something like nine laws in total, and 

obviously they need to pick up their game. Haiti needs new 

anticorruption law. They need modern laws to allow for electronic 

signatures and better business practices. They need law to make 

it easier to register a new business. They need a law to make it 

easier to get a construction permit. I could go on and on, but you 

get the idea. 

And so part and parcel of that is having this political peace between the executive and the Parliament. I was down there last 

week meeting with them, saying they need to find a better way to 

work together. The irony wasn’t lost on them about our own situation, I should mention. 

Ms. ROS-LEHTINEN. No. If you will excuse me, I know that that 

is a cute dig, but you surely are not comparing the United States 

Government——

Mr. ADAMS. And I tell them that. 

Ms. ROS-LEHTINEN [continuing]. With any government in the 

world. I mean, we are talking about——

Mr. ADAMS. I agree. I agree. 

Ms. ROS-LEHTINEN [continuing]. A country we are trying to help, 

which have invested millions of dollars, and they don’t have elections. They are not registering people. They are not calling for elections. 

Do you think that having U.S. businesses do business in Haiti, 

in a place where there is no due process, we have U.S. companies 

that have filed complaints with the Haitian Government, and we 

want to say that Haiti is open for business? What about all of the 

complaints that U.S. firms have already filed? 

And you can make digs——

Mr. ADAMS. Right. 

Ms. ROS-LEHTINEN [continuing]. At the U.S. Government, but 

please don’t compare——

83

Mr. ADAMS. Yeah. Yeah. 

Ms. ROS-LEHTINEN [continuing]. My adopted homeland, the 

greatest country on Earth, to any country in the world. 

Mr. ADAMS. No. And I am sorry if I gave that impression. 

Ms. ROS-LEHTINEN. Impression? 

Mr. ADAMS. But there are—we have a very active economic commercial section, which helps Americans get business down there 

and helps resolve disputes. And I can’t go into cases too much, but 

let me just say not all American businesses that go down to Haiti 

are purely ethical and honorable, so sometimes the disputes, while 

there is a dispute between an American company, the Haitians are 

right. Often the Haitians are wrong. And so we sort these cases out 

individually. 

On at the elections, they are 2 years overdue, and we constantly 

tell the Haitians that we have some expectations of the Haitian 

Government. One is that they be seen as democratic. Democracies 

have elections on schedule. They have free and fair elections. We 

also expect them to curb corruption, to work to curb corruption. 

There has been some progress there. There needs to be more. This 

government has filed more anticorruption cases than any of their 

predecessors have. The weaknesses: They don’t prosecute them successfully because they need a new anticorruption law. They say 

their current law is—makes that difficult. 

They also need to address human rights issues. 

Ms. ROS-LEHTINEN. I am sorry. I am over time as well. 

Mr. ADAMS. Okay. 

Ms. ROS-LEHTINEN. So, sorry. I did not realize. I apologize to our 

members. Thank you, and I am sorry I did not give you a chance. 

Thank you. 

Mr. Meeks is recognized. 

Mr. MEEKS. Thank you very much. 

Ms. ROS-LEHTINEN. And we can go over because we both went 

over. 

Mr. MEEKS. Let me first ask, I guess, Ms. Hogan. One of the 

issues that we are seeing that we—the first mistake was made in 

the underestimation. So my first question is in the beginning did 

we do any consultations with the Haitians on the size, et cetera, 

because as I said to Mr. Gootnick, that it seems to me, in 2013, to 

build a home without the infrastructure necessary to at least have 

a sewer system so that people could have plumbing in their homes, 

that would have been a nonstarter in the beginning. And I would 

imagine that if you talked to anyone from Haiti initially in that regard, then that would have come up then at the time of the initial 

estimates, and we wouldn’t be talking about overruns now, which 

then causes the difficulties that we have here in trying to move forward. 

So I was wondering what, if any, consultation you had with the 

Haitians in the beginning process with reference to coming up with 

the estimates that we are coming up with as to what the size, you 

know, and what should be there. 

Ms. HOGAN. Thank you for your question. Yes, indeed, we did 

have initial consultations with the Government of Haiti in terms 

of its expectations. One of the drivers of the cost, however, was not 

so much the indoor plumbing, but whether it was rain-fed or piped. 

84

We had initially anticipated doing pipe stands so that people could 

collect water outside their home and bring it inside, and also have 

cisterns above their roofs to collect rainwater and feed it that way. 

What the Government of Haiti really wants to do is create a prototype for what is dignified housing for low-income populations, 

and I should say that they are using the same design for the housing that they are building with their own resources. They have a 

social housing site, infrastructure site now, which is the first of its 

kind in Haiti, funded by the Government of Haiti, that has about 

2,000 units under construction, and it is very similar in size to the 

houses that we have built, and it also includes this indoor plumbing as well. So they are not holding us to a higher standard than 

themselves. And, in fact, I think that this is, although a very modest home by anyone’s standards, it is a dream come true for whoever gets to live in that kind of space. 

Mr. MEEKS. But clearly, then, their expectations of what they are 

asking for, the aspirations of their people is not out—they are not 

asking for mansions. They are asking for something that would be 

reasonable for, you know, the situation that you have in Haiti. 

And, you know, at a time after the terrible earthquake, what the 

thought was, well, here we have an opportunity to start from 

scratch, ‘‘scratch’’ meaning infrastructure building, et cetera, and 

thereby including what—you know, what the people want, because 

they are going to have to live there for a long time and needs to 

be something that is sustainable, not something that has to be 

done again in the next 5 or 10 years. And I think that, from what 

I am hearing, what they were talking about is something that 

would be more sustainable and more long-lasting. And, I mean, I 

think that is kind of—should be very important to include that in. 

Let me—you also talked about a number of capacity-building 

projects. Now, what metric are you using? How many—you know, 

can tell us how many companies that are Haitian that are receiving help to build this capacity? What number? What is the percentages? Are there any goals that you have set in place? Do you have 

that information? 

Ms. HOGAN. Yes, I do. I would want to say that, first, in terms 

of reaching local Haitian institutions, we have gone from $1 million 

of direct awards to Haitian institutions in 2011 to $10.1 million. So 

we have a metric of increasingly working through local institutions, 

and the metric is up to 17 percent. We are trying to reach 17 percent of our overall budget to be channeled through local institutions. 

It is a very time-consuming goal because it requires us to hire 

CPA firms to work with those institutions to develop the kind of 

accounting systems that would allow us to invest USG resources 

and for them to be accountable. It is a worthy goal, because ultimately they have got to develop that capacity in order to manage 

their own development programs. 

Another example is in the health sector, where we have performance-based contracting now in place whereby the Government of 

Haiti has to reach certain benchmarks. The Government of Haiti’s 

Ministry of Health has to reach certain benchmarks, and these are 

negotiated with them up front in terms of health gains, and then 

85

we pay as they reach those gains. So that is another way in which 

we are building the capacity of the health system going forward. 

Mr. MEEKS. Let me ask. And, Mr. Adams, in your testimony, in 

reviewing your testimony, you talked about that there were staffing 

issues that slowed the process especially, as well as procurement 

and contracting challenges. Is there a mechanism in your procurement and contracting challenges for—and I think—I think Congresswoman Waters was going in that direction earlier—for joint 

venture projects with Haitian companies and Haitian businesses, 

and are there any goals in that regard so that there are Haitian 

businesses that are being stabilized and able to come up so that 

they can live on their own? 

Mr. ADAMS. Yeah, that is a very good question. 

Staffing after the earthquake, we had staffing challenges for a 

number of reasons. One is our employees needed to be in safe housing. A lot of our housing was destroyed during the earthquake, so 

we had some constraints on sending people down there, particularly long term, and we still have those to a certain degree. I think 

the USAID mission, for example, is understaffed, frankly, and we 

need to grow its capacity and are taking some steps to do that. 

Similarly, other U.S. Government agencies working on their own 

contracting. The Bureau of International Narcotics and Law Enforcement, as well as USAID, has had some contracting challenges, 

we admit. I think we have strengthened our teams working in both 

these areas, both for INL and for USAID, and I think we can claw 

back at the backlog of procurement that we have down there. 

Mr. MEEKS. Lastly, let me just ask this, because there is a number of individuals in the Haitian diaspora who are tireless in these 

efforts to raise the awareness in the plight about the Haitian people and what is happening there. Is there a role that you see that 

the Haitian diaspora can play in helping you develop, and if so, 

what is that role? And, you know, what are the opportunities that 

members of the Haitian diaspora can participate so that they can 

be involved there? 

Mr. ADAMS. Certainly. I talk often to the diaspora. In fact, I have 

traveled to many cities in this country, along with Beth and others 

from USAID, to talk to the diaspora about how they can contribute 

and how they can get U.S. Government contracts and grants, which 

many of them seek, but also other ways to help in Haiti. 

Many members of the diaspora are helping in Haiti in any number of ways, large ways, large and small, and certainly two members of my own staff are Haitian/Americans, very valuable ones. 

And we are always glad to talk to the diaspora about helping, but 

I think two things need to be borne in mind here. One, they often 

ask for a set-aside for Haitian/Americans, and we have to remind 

them that that is against our law. And the other thing is to tell 

them that our goal is really to create jobs for Haitians, and that 

is an overriding effort on our part. But we do—we do work very 

closely with the diaspora and appreciate their contributions. 

Beth may want to add to that. 

Ms. HOGAN. I would like to point out that the first housing complex where people are now moving in was built by a Haitian/American firm, and we are very happy with the quality of what we have 

86

seen that firm produce. So we are very excited about people actually getting keys, moving in and starting new lives. 

I also want to say that with the Haitian diaspora, what Haiti 

needs more that anything is investments, and so one of the things 

that we are trying to seek through our business plan competition 

that I mentioned in my opening remarks is opportunities for Haitian diaspora and other investors to invest in these small businesses so that they can expand their operation and create jobs, because that is ultimately what Haiti needs more than anything, is 

job creation so that people can afford to buy homes, send their kids 

to school, meet their health needs, et cetera. I think there is a huge 

role for the Haitian diaspora to play in that regard. 

Ms. ROS-LEHTINEN. Thank you so much. And that is the limit of 

our going over, so thank you. 

My good friend, Karen Bass from California, is recognized. 

Ms. BASS. Madam Chair, I would like to yield my time to Congresswoman Waters. 

Ms. ROS-LEHTINEN. Without objection. 

Ms. WATERS. Thank you very much, Congresswoman Bass, for 

yielding time to me. I am very appreciative for that. 

And I would like to thank our ranking member Mr. Engel for his 

interest and concern in Haiti. We have traveled there, and I would 

like to say to him, if you and the chairman can arrange a codel, 

many of us would like to go back very soon to look at some of the 

work that we have been involved in. 

And I would like to say to Mr. Adams and Ms. Hogan, this is not 

easy work, and we understand that. It is very difficult, and I appreciate whatever progress that you have made. And I am really 

concerned about the Haitians being able to create jobs and to do 

joint ventures. 

And I held a meeting up at Henry Saenz’s home in Haiti where, 

you know, the middle-class Haitians all gathered, and I had USAID 

come up to show me the forms that you use, your requests for proposal. They were not—nothing in Creole, no technical assistance, 

two local businesses. The kind of experiences that are being asked 

and the assets that are being asked about, I mean, it is just unreasonable. So I would really like to see some movement in that area, 

because as you will hear from most of us who work with Haiti, who 

love Haiti, we really want to see Haitians empowered to be able to 

run their own country, to run their own businesses, et cetera. 

Having said that, and not being able to say everything I would 

like to say, I sincerely believe that until we get governance right 

in Haiti, that you are not going to be able to do the best job that 

you can do. Until we provide the technical assistance to Haiti, we 

are not going to be able to have the kind of institution that you 

allude to to do what needs to be done. 

Now, I know that you were just down there, Mr. Adams. I talked 

to you before you left, and you probably got a copy of my letter that 

I sent to the Secretary. And I know that Haiti is sovereign country, 

and we can’t just go and tell them what to do, but I think they 

want our technical assistance, and I think a lot of the missteps is 

about a lack of knowledge and understanding about how to get 

some of this done. 

87

Now, you know that I am very, very concerned, and in that letter 

that I sent to the Secretary, and I cc’d you, I said that I am especially concerned about the political challenges facing the Haitian 

Senate. Under the Haitian Constitution, the Senate should consist 

of 30 Senators, each of whom is elected to serve for 6 years. However, one-third of the seats in the Senate are currently vacant. 

These 10 Senators’ terms ended in 2012, and Haiti has yet to hold 

or even schedule elections to replace them. This has forced the Senate to function with only two-thirds of its full complement and 

made it extremely difficult for the Senate to assemble a quorum 

and conduct legislative business. 

A second group of 10 Senators took office in 2009, and their 6-

year terms are scheduled to expire 2015. Unfortunately, it appears 

that elections to replace these Senators may not be held on schedule either, and, of course, there is widespread rumor within Haiti 

and among the Haitian diaspora that the Haitian Government does 

not intend to allow the Senators elected in 2009 to serve out their 

full 6-year terms. This rumor has it that the government intends 

to force these 10 Senators to leave office in January 2014, leaving 

the Senate completely unable to function, and this, of course, renews old concerns about dictatorship. 

Now, I am not going to go any further except to try and make 

this point, that we are providing a lot of aid, and it has done a lot 

of good. I want us to continue to provide aid. I want housing built. 

I want potable water. I want all of those things. But I also want 

us to have some conditions, and part of those conditions have to do 

with the Constitution and the ability to have a government that 

functions. And I want us to assign resources to help them get these 

elections together so that people can make decisions, and you are 

not down there trying to make decisions that you shouldn’t have 

to make. 

And so my question, if I still have time to ask it, is, Mr. Adams, 

did you take a message down there that—when you went that you 

were willing to provide technical assistance to get these elections 

done? 

Mr. ADAMS. Yes. Short answer is we have offered $10 million to 

support these next round of elections. The cost is estimated to be 

about $34 million. The Government of Haiti will put in about $14 

million, and other donors will make up the difference. 

So money is not the issue on the elections. Again, we are—we 

have helped Parliament through a parliamentary strengthening 

program that it has to analyze their electoral laws and help 

produce laws, and that has had some results, but as I mentioned, 

we think they can do better there. 

I think on the elections, I think you are right, they do want us 

to help them schedule a whole series of elections next year. I don’t 

have time to go into how that might work, but I will be glad to talk 

to you or your staff about sort of how we think that is going to 

work out. But your letter was very helpful. They had—they were 

aware of it, so thank you for sending it. 

Ms. WATERS. You are welcome. Thank you. 

And I yield back the balance of my time, and I thank you, Congresswoman Bass. But she left. Thank you. 

Ms. ROS-LEHTINEN. Thank you very much. 

88

And now we will go to the esteemed Members of Congress who 

are not on this committee, but who have earned the right to be recognized and ask questions. We are honored to have Barbara Lee, 

who was first here, recognized for her questioning. And you may 

go over the time limit, too, Ms. Lee. 

Ms. LEE. Thank you very much, Madam Chair, and thank you 

once again for your leadership and also for your assistance last 

Congress in getting our legislation, Assessing Progress in Haiti Act, 

passed, and I look forward to working with you on this reintroduction. 

Ms. ROS-LEHTINEN. I am blessed to work with you. Thank you. 

Ms. LEE. Thank you very much. 

And to our ranking member Mr. Engel, thank you so much for 

your continued leadership as it relates to the Caribbean region. I 

have served on the Western Hemisphere Subcommittee for many 

years with Mr. Engel, and he ensured that we had some focus and 

priority on the Caribbean, and especially Haiti. So thank you 

again. 

Let me ask you a couple of things. First of all, just to mention 

to Mr. Adams, you know, we have—while set-asides may not be 

legal, you said against the law, we had minority business requirements in statute, and believe you me, I know how State and 

USAID conduct their contracting, and you-all have a pretty dismal 

record in terms of contracting with minority and women-owned 

businesses. And so I would hope that you would go back to the 

drawing board and look at how you can engage more with Haitian 

businesses, Haitian and the diaspora businesses, as well as African 

American companies, and other minority companies who want to 

participate. 

You mentioned the $70 million contract for the port construction 

that was just let. I wanted to ask you if you know how much of 

that contract was minority-owned in terms of subcontracting, or requirements for subcontracting for either Haitian-owned businesses 

or minority-owned businesses. That is the first question. 

And then second, on the involvement of Haitian Americans, Haitians and the diaspora, we had a specific requirement that USAID 

make it as a priority not only to talk to the Haitian Americans, but 

to engage in funding some of these technical exchanges and professional exchanges. And so I want to see how that is working and 

if, in fact, that has been a priority within your funding mechanism. 

Mr. ADAMS. Yeah. On the port contract, that was a contract let 

by the Government of Haiti, not the United States of America, so 

I don’t know what minority contracting provisions they put in 

there. I think it was just a simple contract with a port construction 

company. 

Ms. LEE. Is it a—I don’t remember whether you said—is it a Haitian-owned company or a U.S. company? 

Mr. ADAMS. It is a U.S.—it is a Florida company. Actually it is 

a U.S. subsidiary, a fully owned U.S. subsidiary of an Italian company, but it is a U.S. company. 

Ms. LEE. Yeah. Could you look into that for us and let us know? 

Mr. ADAMS. Sure. 

Ms. LEE. What the elements of that contract are? 

Mr. ADAMS. Sure. 

89

Ms. LEE. Okay. Thank you very much. 

And then on the Haitian American exchanges, the technical exchanges, the support for Haitians in diaspora to go back to Haiti 

to contribute to their homeland? 

Ms. HOGAN. Yes. Indeed, we have initiated a program similar to 

what a Fulbright scholarship might look like to send and embed 

Haitian Americans into key ministries for a period of up to 1 year 

to work side by side with government counterparts to try to improve their institutional capacity. 

Ms. LEE. How many do you have now, and how is that broken 

down? We worked on this for many, many years, and I would like 

to get sort of an update on that. 

Ms. HOGAN. Okay. I will defer to State since State runs that program. 

Mr. ADAMS. Yeah, it is run by our Educational Cultural Affairs 

Bureau. There were three last year, and there are three—there are 

going to be three more replacing him about now actually. They are 

changing over. It has been very successful. 

Ms. LEE. You mean three individuals? 

Mr. ADAMS. Yeah, three. They are academics largely. They are—

I mean, they can come from anywhere. They happen to be Haitian 

Americans, for the most part. One was assigned to the Ministry of 

Health, one to the Prime Minister’s office, and one to the Ministry 

of Planning, and they were very well received, and we are going 

to repeat it. 

Ms. LEE. Well, I would like not only repeat it, we need to enhance this and make it a priority. And I don’t think three is sufficient for what we had initially suggested as some of the goals for 

engaging the Haitian diaspora. 

Mr. ADAMS. Yeah, I agree with you. Some of the limitations are 

security generated, and I would be glad to discuss that with you 

later. 

Ms. LEE. Yeah. I think I would like to follow up with that. 

Also, a couple of things on the Haiti strategy plan. This GAO report, again, I just have to say really reinforces the need for legislation. On the results framework within the Haiti strategy plan, how 

does the United States assess the assistance activity, USAID activities, how they are impacting the lives of Haitians? We asked 

about this performance management plan, which includes all the 

benchmarks used to measure performance and effectiveness. How 

do you do that? 

And then also I know that we had requested a detailed programby-program description of USAID activities by, you know, your 

goals, your objectives, and the amounts of funds obligated for each 

program. That was part of the report that the Senate Committee 

on Appropriations had requested, as well as all of the other requirements that we asked for. You know, what is happening with 

that? 

Ms. HOGAN. Yes. In fact, I want to say that just in the last couple of months, we have launched what we call the Foreign Assistance Dashboard that now lists all of our programs by country, by 

amount, by contracting agency or NGO. So that is a huge step forward in meeting President Obama’s Open Government Initiative. I 

90

just want to reaffirm that we are completely committed, as an 

agency, to full transparency in what we are doing. 

Ms. LEE. Could we receive a copy of that report? 

Ms. HOGAN. Well, it is a dashboard. It is an electronic system, 

so you actually go into it, but we can certainly send you the link 

for it. Happy to do that. 

And as I say, we are not only committed to providing information, but to making it accessible, hence the dashboard. So I think 

we are going to keep building on that over time. And it is not just 

USAID’s resources; in fact, it is all USG assistance, so it includes 

State, it includes Treasury, it includes some of the DOD activities 

that they are doing on international development. So this is just 

the beginning, but it is getting built out as we speak, and I think 

it is going to be a huge resource for Congress and other interested 

stakeholders. 

Ms. LEE. Okay. And then in the GAO report—this is my final 

question on—which was really quite shocking and appalling when 

I saw this—.4 percent of funds went to domestic Haitian NGOs and 

businesses? Point-four percent? What is that about? 

Ms. HOGAN. It is much too low, and as I say, we have a target 

of getting up to 17 percent, and even getting to 17 percent is going 

to be difficult because of the low capacity. But we are committed 

to putting resources into building that capacity so that we will be 

able to——

Ms. LEE. But this has been going on for years and years and 

years, and so what is the problem? 

Ms. HOGAN. I think we have put aside funds specifically to build 

capacity for people to meet our requirements for grant management, so that is what is different, and that is going to help us meet 

that goal. Although very little of our money goes directly—as I said, $10.1 

million last year went directly to Haitian institutions—we have 

spent $50 million through grants and subgrants and subcontracts 

to Haitian institutions. And so we are increasing our numbers both 

through subs as well as direct, but ideally we are going to get to 

direct, and one——

Ms. LEE. Could you break down those institutions, though, and 

send us the report on them? 

Ms. HOGAN. Certainly. 

Ms. LEE. Again, that is a——

Ms. HOGAN. Certainly. 

Ms. LEE [continuing]. Requirement of my legislation. 

Ms. HOGAN. One thing I would like to highlight for you is a very 

innovative condition that we put into our new agricultural program 

in the north, which we call Feed the Future North, and in that contract that has been awarded to a U.S. company, their performance 

fee is going to be tied to the degree to which they can ‘‘graduate’’ 

Haitian subcontractors to the point that they can then become primary contractors in their own right. I think this is the first time 

we have done it as an agency, and we are doing it in Haiti. 

Ms. LEE. That is a very good idea, makes a lot of sense. Again, 

I want to see your U.S. companies, any Haitian-owned U.S.-based 

companies, or minority-owned companies. 

Ms. HOGAN. Certainly. 

91

Ms. LEE. U.S. Thank you. 

Chairman ROYCE [presiding]. Frederica Wilson from Florida. 

Ms. WILSON. Thank you for holding this hearing. I will not have 

time to ask the many questions that I have that have been submitted to me by my constituents, so I am going to leave them for 

you—for staff to get answers to them. But the one thing they are 

concerned about is what is being discussed here today: How do they 

become a part of the rebuilding of Haiti? This is what they want 

to do. They feel left out. 

And you talked about the laws of the United States, but what 

about the laws of Haiti? When you said the Haitian Government 

let out a contract for the port. Will the Haitian Government make 

sure that there is minority participation, and will they make sure 

that Haitian companies are involved? 

They also have some criticisms of USAID, and they have criticism of the Haitian Government, and one is—another one is the 

taxes on any money transfers into Haiti. There is a tax put on the 

money to improve education, and they need to find out is there any 

oversight of this money that is being sent to Haiti? Is it really 

being used for education? Who is making sure that they are building schools? Because people in the diaspora go over and they build 

schools, they build churches, orphanages, community centers, but 

they don’t ever get any return for that. So they are not getting contracts; they are doing this on their own time and money. 

And also, there was a ruling in the Dominican Republic the other 

day about Haitians—that will render stateless four generations of 

Haitian Dominicans. Will our government do anything to help with 

this problem? It is a real issue. And if we continue to say that the 

Haitian Government lacks capacity, how are we going to build it? 

So there are many, many questions about the restavecs, and are 

we following these children? What are we doing as a government 

to make sure? Because the problem has increased since the earthquake. There are problems of insecurity, deprivation, hunger, and 

lack of prevention. 

And those are some of the issues, but I have a long list that I 

would like to get answers for so that I can—I am going to have a 

tele-town hall meeting with the Haitian community to make sure 

that they have appropriate answers for this. They are concerned 

about the elections, and they are saying in the community in 

Miami that when the President does not allow for the elections, he 

is appointing people to these Senate seats, and he is appointing 

people to mayorships and different elected positions when the people should be electing them. The President is appointing his friends 

to these different positions. So there is a lot of criticism against the 

Government of Haiti and a lot of criticism against USAID. 

So I will submit the questions to you. But just try to answer the 

one about the Dominican Republic. Is anything happening with 

that? 

Mr. ADAMS. Sure. I will be glad to speak to that. 

On September 23rd, the Dominican Supreme Court issued a ruling which basically said that those residing in the country of Haitian origin were only transients and weren’t entitled to citizenship. 

This prompted the Government of Haiti to withdraw its Ambassador, and a number of international organizations, U.N. agencies, 

92

protested this result as being in violation of international law and 

norms, and particularly a 2005 judgment by the Inter-American 

Court of Human Rights, which states that children do not inherit 

the illegal status of their parents. 

So there is a lot of controversy here. We have engaged, at very 

senior levels, with the Government of the Dominican Republic in 

a way to figure out how we can ameliorate this situation, and there 

are a number of avenues that could take place on that, but it is 

fairly complicated. I will be glad to brief you on that separately, 

but rest assured, we are engaged diplomatically in this. 

Ms. WILSON. Thank you. 

Chairman ROYCE. Okay. We go now to Yvette Clarke from New 

York. 

Ms. CLARKE. I thank you, Mr. Chairman, and I want to thank 

Congressman Engel for extending the invitation to sit in and to listen. And I think most of the colleagues have really hit some of the 

more salient points and concerns that I have. I look forward to the 

responses that were requested by colleagues. However, I do have 

a question about the minimum wage. 

During the questioning of Dr. Gootnick, he spoke to the issue of 

the minimum wage. And Haiti’s minimum wage is among the lowest among countries that export apparel, and it is the lowest in the 

Western Hemisphere. In addition, garment factory owners, including those in the Caracol Park, which is heavily subsidized by U.S. 

funding and benefits from trade preferences under HOPE II, are 

violating U.S. law and Haitian laws. The Better Work Haiti Program established by the International Labor Organization and the 

International Finance Corporation reported that every single one of 

Haiti’s 24 garment factories is failing to pay the minimum wage. 

Therefore, is the State Department and USAID aware of this issue, 

and if so, are you-all engaging the factory industries to be more 

compliant? 

Mr. ADAMS. That is an excellent question, and let me give you 

a fairly extensive answer on that. 

The Haitian minimum wage law requires a base wage of 200 

gourds a day for those involved in export industries. The Better 

Work Haiti report found that all the export factories are pretty 

much in compliance with that lower wage tier. The Haitian law is 

unclear, however, and requires that piece work in these factories—

anyone engaged in piece work be given an opportunity to earn a 

higher 300-gourd wage, but it never defined how that wage was to 

be established. 

Ms. CLARKE. Can you translate the gourd in gourd dollars? 

Mr. ADAMS. About 44 gourds to a dollar. 

Ms. CLARKE. Okay. 

Mr. ADAMS. Okay. 

Ms. CLARKE. 44 gourds to a dollar 

Mr. ADAMS. So, the 200-gourd wage is about 5 bucks. The 300-

gourd wage is about 7 bucks. 

Ms. CLARKE. And that is 5 bucks a day? 

Mr. ADAMS. Yes, ma’am, which is higher than Asian wages, I 

might add. 

But at any rate, the Government of Haiti has worked with the 

factory owners, with labor and others to define how that 300-gourd 

93

wage is reached, and I think they have gotten everybody in agreement, and when that is promulgated by the Government of Haiti, 

it will clarify this whole area. 

All of the factories in Haiti cannot export to the U.S. unless they 

meet core labor standards. So we have found that with—with—as 

we resolve these issues, they are very resolvable, there is incentive 

on both sides to do it, and I am firmly convinced that this—this 

unclear area of Haitian wage law will be clarified very shortly, and 

that the factories will be in compliance with it. 

Ms. CLARKE. I think it is critical, because if we are subsidizing 

that, then we become complicit. And, you know, we are here to help 

the Haitian people, that is our moral obligation, and for us to sit 

and twiddle our thumbs while these folks are exploited does not 

bode well for us as a Nation. 

Mr. ADAMS. Rest assured, we are not twiddling our thumbs. The 

U.S. Department of Labor is engaged in this, providing help and 

assistance to both sides. 

Ms. CLARKE. Do we have a sense of when this will be resolved, 

how this will be proclaimed, how people will know their rights as 

workers, and, you know, how we hold these factories accountable? 

I mean, if you are inclined to get away with paying people, you 

know, below minimum wage, then you are inclined to do that notwithstanding, you know, what we set. You know, we should not 

have our dollars invested in these types of companies. 

Mr. ADAMS. No, I think this has been a good story by and large, 

the compliance with core labor standards, and I think this will continue to be a good story. 

Ms. CLARKE. I would just like to add my voice to that of Congresswoman Waters about the governance concerns. We have got to 

fix that. You know, everything else we are saying here becomes 

moot if this government tilts toward a dictatorship. And, you know, 

this is a very, very serious issue. Whatever we must do, we must 

do to get them on the right track and make sure that democracy 

continues down the road to strength. 

Thank you. 

Mr. Chairman, I yield back, and I thank you for the opportunity 

today. 

Chairman ROYCE. I thank the gentlelady. And let me also thank 

our witnesses for their willingness to come here and to testify 

today, Ms. Hogan, Mr. Adams. And as I said in my opening statement on this issue of lack of rule of law and lack of transparency 

in Haiti, both the Haitians and the U.S. taxpayers deserve better. 

I would like to share some good news. Earlier this year some private charitable groups were having problems getting an air ambulance program approved for Medor, Haiti, and we raised this issue 

with Tom Adams, and we want to express our appreciation because 

you along with the Haitian authorities, helped resolve the issue. 

The committee learned just yesterday that verbal permission has 

been given by the civil aviation authorities to proceed with a free 

emergency air ambulance program into Medor, and, additionally, 

that you were present at the meeting with the Haitian Government 

when this happened. So we thank you for that, Mr. Adams, and 

just want to convey that the committee appreciates your good work 

on behalf of these charitable groups. 

94

And again, thank you both for your testimony here today. 

Mr. ADAMS. Thank you, sir 

Chairman ROYCE. We stand adjourned. 

[Whereupon, at 1:10 p.m., the committee was adjourned.] 

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