69–006

106TH CONGRESS REPORT " ! HOUSE OF REPRESENTATIVES 1st Session 106–40

DISASTER MITIGATION AND COST REDUCTION ACT OF 1999

MARCH 3, 1999.—Committed to the Committee of the Whole House on the State of

the Union and ordered to be printed

Mr. SHUSTER, from the Committee on Transportation and

Infrastructure, submitted the following

R E P O R T

together with

ADDITIONAL VIEWS

[To accompany H.R. 707]

The Committee on Transportation and Infrastructure, to whom

was referred the bill (H.R. 707) to amend the Robert T. Stafford

Disaster Relief and Emergency Assistance Act to authorize a program for predisaster mitigation, to streamline the administration of

disaster relief, to control the Federal costs of disaster assistance,

and for other purposes, having considered the same, report favorably thereon with amendments and recommend that the bill as

amended do pass.

The amendments are as follows:

Strike out all after the enacting clause and insert in lieu thereof

the following:

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Disaster Mitigation and Cost Reduction Act of

1999’’.

SEC. 2. AMENDMENTS TO ROBERT T. STAFFORD DISASTER RELIEF AND EMERGENCY ASSISTANCE ACT.

Except as otherwise specifically provided, whenever in this Act an amendment or

repeal is expressed in terms of an amendment to, or repeal of, a section or other

provision of law, the reference shall be considered to be made to a section or other

provision of the Robert T. Stafford Disaster Relief and Emergency Assistance Act

(42 U.S.C. 5121 et seq.).

TITLE I—PREDISASTER HAZARD MITIGATION

SEC. 101. FINDINGS AND PURPOSE.

(a) FINDINGS.—Congress finds that—
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(1) greater emphasis needs to be placed on identifying and assessing the risks

to State and local communities and implementing adequate measures to reduce

losses from natural disasters and to ensure that critical facilities and public infrastructure will continue to function after a disaster;

(2) expenditures for post-disaster assistance are increasing without commensurate reduction in the likelihood of future losses from such natural disasters;

(3) a high priority in the expenditure of Federal funds under the Robert T.

Stafford Disaster Relief and Emergency Assistance Act should be to implement

predisaster activities at the local level; and

(4) with a unified effort of economic incentives, awareness and education,

technical assistance, and demonstrated Federal support, States and local communities will be able to increase their capabilities to form effective communitybased partnerships for mitigation purposes, implement effective natural disaster

mitigation measures that reduce the risk of future damage, hardship, and suffering, ensure continued functioning of critical facilities and public infrastructure, leverage additional non-Federal resources into meeting disaster resistance

goals, and make commitments to long-term mitigation efforts in new and existing structures.

(b) PURPOSE.—It is the purpose of this title to establish a predisaster hazard mitigation program that—

(1) reduces the loss of life and property, human suffering, economic disruption, and disaster assistance costs resulting from natural hazards; and

(2) provides a source of predisaster hazard mitigation funding that will assist

States and local governments in implementing effective mitigation measures

that are designed to ensure the continued functioning of critical facilities and

public infrastructure after a natural disaster.

SEC. 102. STATE MITIGATION PROGRAM.

Section 201(c) (42 U.S.C. 5131(c)) is amended—

(1) by striking ‘‘and’’ at the end of paragraph (1);

(2) by striking the period at the end of paragraph (2) and inserting ‘‘; and’’;

and

(3) by adding at the end the following:

‘‘(3) set forth, with the ongoing cooperation of local governments and consistent with section 409, a comprehensive and detailed State program for mitigating against emergencies and major disasters, including provisions for

prioritizing mitigation measures.’’.

SEC. 103. DISASTER ASSISTANCE PLANS.

Section 201(d) (42 U.S.C. 5131(d)) is amended to read as follows:

‘‘(d) GRANTS FOR DISASTER ASSISTANCE AND HAZARD IDENTIFICATION.—The President is authorized to make grants for—

‘‘(1) not to exceed 50 percent of the cost of improving, maintaining, and updating State disaster assistance plans including, consistent with section 409, evaluation of natural hazards and development of the programs and actions required to mitigate such hazards; and

‘‘(2) the development and application of improved floodplain mapping technologies that can be used by Federal, State, and local governments and that the

President determines will likely result in substantial savings over current floodplain mapping methods.’’.

SEC. 104. PREDISASTER HAZARD MITIGATION.

Title II (42 U.S.C. 5131–5132) is amended by adding at the end the following:

‘‘SEC. 203. PREDISASTER HAZARD MITIGATION.

‘‘(a) GENERAL AUTHORITY.—The President may establish a program to provide financial assistance to States and local governments for the purpose of undertaking

predisaster hazard mitigation activities that are cost effective and substantially reduce the risk of future damage, hardship, or suffering from a major disaster.

‘‘(b) PURPOSE OF ASSISTANCE.—

‘‘(1) IN GENERAL.—Except as provided in paragraph (2), a State or local government that receives financial assistance under this section shall use the assistance for funding activities that are cost effective and substantially reduce

the risk of future damage, hardship, or suffering from a major disaster.

‘‘(2) DISSEMINATION.—The State or local government may use not more than

10 percent of financial assistance it receives under this section in a fiscal year

for funding activities to disseminate information regarding cost effective mitigation technologies (such as preferred construction practices and materials), in-
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cluding establishing and maintaining centers for protection against natural disasters to carry out such dissemination.

‘‘(c) ALLOCATION OF FUNDS.—The amount of financial assistance to be made available to a State, including amounts made available to local governments of such

State, under this section in a fiscal year shall— ‘‘(1) not be less than the lesser of $500,000 or 1.0 percent of the total funds

appropriated to carry out this section for such fiscal year; but

‘‘(2) not exceed 15 percent of such total funds.

‘‘(d) CRITERIA.—Subject to the limitations of subsections (c) and (e), in determining

whether to provide assistance to a State or local government under this section and

the amount of such assistance, the President shall consider the following criteria:

‘‘(1) The clear identification of prioritized cost-effective mitigation activities

that produce meaningful and definable outcomes.

‘‘(2) If the State has submitted a mitigation program in cooperation with local

governments under section 201(c), the degree to which the activities identified

in paragraph (1) are consistent with the State mitigation program.

‘‘(3) The extent to which assistance will fund activities that mitigate hazards

evaluated under section 409.

‘‘(4) The opportunity to fund activities that maximize net benefits to society.

‘‘(5) The ability of the State or local government to fund mitigation activities.

‘‘(6) The extent to which assistance will fund mitigation activities in small impoverished communities.

‘‘(7) The level of interest by the private sector to enter into a partnership to

promote mitigation.

‘‘(8) Such other criteria as the President establishes in consultation with State

and local governments.

‘‘(e) STATE NOMINATIONS.— ‘‘(1) IN GENERAL.—The Governor of each State may recommend to the President not less than 5 local governments to receive assistance under this section.

The recommendations shall be submitted to the President not later than October 1, 1999, and each October 1st thereafter or such later date in the year as

the President may establish. In making such recommendations, the Governors

shall consider the criteria identified in subsection (d).

‘‘(2) USE.— ‘‘(A) GENERAL RULE.—In providing assistance to local governments under

this section, the President shall select from local governments recommended by the Governors under this subsection.

‘‘(B) WAIVER.—Upon request of a local government, the President may

waive the limitation in subparagraph (A) if the President determines that

extraordinary circumstances justify the waiver and that granting the waiver will further the purpose of this section.

‘‘(3) EFFECT OF FAILURE TO NOMINATE.—If a Governor of a State fails to submit recommendations under this subsection in a timely manner, the President

may select, subject to the criteria in subsection (d), any local governments of

the State to receive assistance under this section.

‘‘(f) SMALL IMPOVERISHED COMMUNITIES.—For the purpose of this section, the

term ‘small impoverished communities’ means communities of 3,000 or fewer individuals that are economically disadvantaged, as determined by the State in which

the community is located and based on criteria established by the President.

‘‘(g) FEDERAL SHARE.—Financial assistance provided under this section may contribute up to 75 percent of the total cost of mitigation activities approved by the

President; except that the President may contribute up to 90 percent of the total

cost of mitigation activities in small impoverished communities.

‘‘(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to be appropriated

to carry out this section $25,000,000 for fiscal year 1999 and $80,000,000 for fiscal

year 2000.

‘‘(i) AUTHORIZATION OF SECTION 404 FUNDS.—Effective October 1, 2000, in addition to amounts appropriated under subsection (h) from only appropriations enacted

after October 1, 2000, the President may use, to carry out this section, funds that

are appropriated to carry out section 404 for post-disaster mitigation activities that

have not been obligated within 30 months of the disaster declaration upon which

the funding availability is based.

‘‘(j) REPORT ON FEDERAL AND STATE ADMINISTRATION.—Not later than 18 months

after the date of enactment of the Disaster Mitigation and Cost Reduction Act of

1999, the President, in consultation with State and local governments, shall transmit to Congress a report evaluating efforts to implement this section and recommending a process for transferring greater authority and responsibility for administering the assistance program authorized by this section to capable States.’’.
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SEC. 105. INTERAGENCY TASK FORCE.

The President shall establish an interagency task force for the purpose of coordinating the implementation of the predisaster hazard mitigation program authorized

by section 203 of the Robert T. Stafford Disaster Relief and Emergency Assistance

Act. The Director of the Federal Emergency Management Agency shall chair such

task force.

SEC. 106. MAXIMUM CONTRIBUTION FOR MITIGATION COSTS.

(a) IN GENERAL.—Section 404(a) (42 U.S.C. 5170c(a)) is amended by striking ‘‘15

percent’’ and inserting ‘‘20 percent’’.

(b) APPLICABILITY.—The amendment made by subsection (a) shall apply to major

disasters declared under the Robert T. Stafford Disaster Relief Act and Emergency

Assistance Act after January 1, 1997.

SEC. 107. CONFORMING AMENDMENT.

The heading for title II is amended to read as follows:

‘‘TITLE II—DISASTER PREPAREDNESS AND

MITIGATION ASSISTANCE’’.

TITLE II—STREAMLINING AND COST

REDUCTION

SEC. 201. MANAGEMENT COSTS.

(a) IN GENERAL.—Title III (42 U.S.C. 5141–5164) is amended by adding at the end

the following:

‘‘SEC. 322. MANAGEMENT COSTS.

‘‘(a) IN GENERAL.—Notwithstanding any other provision of law (including any administrative rule or guidance), the President shall establish by rule management

cost rates for grantees and subgrantees. Such rates shall be used to determine contributions under this Act for management costs.

‘‘(b) MANAGEMENT COSTS DEFINED.—Management costs include indirect costs, administrative expenses, associated expenses, and any other expenses not directly

chargeable to a specific project under a major disaster, emergency, or emergency

preparedness activity or measure. Such costs include the necessary costs of requesting, obtaining, and administering Federal assistance and costs incurred by a State

for preparation of damage survey reports, final inspection reports, project applications, final audits, and related field inspections by State employees, including overtime pay and per diem and travel expenses of such employees, but not including

pay for regular time of such employees.

‘‘(c) REVIEW.—The President shall review the management cost rates established

under subsection (a) not later than 3 years after the date of establishment of such

rates and periodically thereafter.’’.

(b) APPLICABILITY.—Section 322 of the Robert T. Stafford Disaster Relief and

Emergency Assistance Act (as added by subsection (a) of this section) shall apply

as follows:

(1) Subsections (a) and (b) of such section 322 shall apply to major disasters

declared under such Act on or after the date of enactment of this Act. Until the

date on which the President establishes the management cost rates under such

subsection, section 406(f) shall be used for establishing such rates.

(2) Subsection (c) of such section 322 shall apply to major disasters declared

under such Act on or after the date on which the President establishes such

rates under subsection (a) of such section 322.

SEC. 202. ASSISTANCE TO REPAIR, RESTORE, RECONSTRUCT, OR REPLACE DAMAGED FACILITIES.

(a) CONTRIBUTIONS.—Section 406(a) (42 U.S.C. 5172(a)) is amended to read as follows:

‘‘(a) CONTRIBUTIONS.—

‘‘(1) IN GENERAL.—The President may make contributions—

‘‘(A) to a State or local government for the repair, restoration, reconstruction, or replacement of a public facility which is damaged or destroyed by

a major disaster and for associated expenses incurred by such government;

and
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‘‘(B) subject to paragraph (2), to a person who owns or operates a private

nonprofit facility damaged or destroyed by a major disaster for the repair,

restoration, reconstruction, or replacement of such facility and for associated expenses incurred by such person.

‘‘(2) CONDITIONS FOR ASSISTANCE TO PRIVATE NONPROFIT FACILITIES.— ‘‘(A) IN GENERAL.—The President may make contributions to a private

nonprofit facility under paragraph (1)(B) only if—

‘‘(i) the facility provides critical services (as defined by the President)

in the event of a major disaster; or

‘‘(ii)(I) the owner or operator of the facility has applied for a disaster

loan under section 7(b) of the Small Business Act (15 U.S.C. 636(b));

and

‘‘(II) has been determined to be ineligible for such a loan; or

‘‘(III) has obtained such a loan in the maximum amount for which the

Small Business Administration determines the facility is eligible.

‘‘(B) CRITICAL SERVICES DEFINED.—In this paragraph, the term ‘critical

services’ includes, but is not limited to, power, water, sewer, wastewater

treatment, communications, and emergency medical care.’’.

(b) MINIMUM FEDERAL SHARE.—Section 406(b) (42 U.S.C. 5172(b)) is amended to

read as follows:

‘‘(b) MINIMUM FEDERAL SHARE.—The Federal share of assistance under this section shall be not less than 75 percent of the eligible cost of repair, restoration, reconstruction, or replacement carried out under this section.’’.

(c) LARGE IN-LIEU CONTRIBUTIONS.—Section 406(c) (42 U.S.C. 5172(c)) is amended

to read as follows:

‘‘(c) LARGE IN-LIEU CONTRIBUTIONS.— ‘‘(1) FOR PUBLIC FACILITIES.— ‘‘(A) IN GENERAL.—In any case in which a State or local government determines that the public welfare would not be best served by repairing, restoring, reconstructing, or replacing any public facility owned or controlled

by such State or local government, the State or local government may elect

to receive, in lieu of a contribution under subsection (a)(1)(A), a contribution

of 75 percent of the Federal share of the Federal estimate of the cost of repairing, restoring, reconstructing, or replacing such facility and of management expenses.

‘‘(B) USE OF FUNDS.—Funds contributed to a State or local government

under this paragraph may be used to repair, restore, or expand other selected public facilities, to construct new facilities, or to fund hazard mitigation measures which the State or local government determines to be necessary to meet a need for governmental services and functions in the area

affected by the major disaster.

‘‘(2) FOR PRIVATE NONPROFIT FACILITIES.—

‘‘(A) IN GENERAL.—In any case where a person who owns or operates a

private nonprofit facility determines that the public welfare would not be

best served by repairing, restoring, reconstructing, or replacing such facility, such person may elect to receive, in lieu of a contribution under subsection (a)(1)(B), a contribution of 75 percent of the Federal share of the

Federal estimate of the cost of repairing, restoring, reconstructing, or replacing such facility and of management expenses.

‘‘(B) USE OF FUNDS.—Funds contributed to a person under this paragraph

may be used to repair, restore, or expand other selected private nonprofit

facilities owned or operated by the person, to construct new private nonprofit facilities to be owned or operated by the person, or to fund hazard

mitigation measures that the person determines to be necessary to meet a

need for its services and functions in the area affected by the major disaster.

‘‘(3) MODIFICATION OF FEDERAL SHARE.—The President shall modify the Federal share of the cost estimate provided in paragraphs (1) and (2) if the President determines an alternative cost share will likely reduce the total amount

of Federal assistance provided under this section. The Federal cost share for

purposes of paragraphs (1) and (2) shall not exceed 90 percent and shall not

be less than 50 percent.’’.

(d) ELIGIBLE COST.—

(1) IN GENERAL.—Section 406(e) (42 U.S.C. 5172(e)) is amended to read as follows:

‘‘(e) ELIGIBLE COST.—

‘‘(1) IN GENERAL.—For the purposes of this section, the estimate of the cost

of repairing, restoring, reconstructing, or replacing a public facility or private
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nonprofit facility on the basis of the design of such facility as it existed immediately before the major disaster and in conformity with current applicable

codes, specifications, and standards (including floodplain management and hazard mitigation criteria required by the President or by the Coastal Barrier Resources Act (16 U.S.C. 3501 et seq.)) shall be treated as the eligible cost of such

repair, restoration, reconstruction, or replacement. Subject to paragraph (2), the

President shall use the cost estimation procedures developed under paragraph

(3) to make the estimate under this paragraph.

‘‘(2) MODIFICATION OF ELIGIBLE COST.—In the event the actual cost of repairing, restoring, reconstructing, or replacing a facility under this section is more

than 120 percent or less than 80 percent of the cost estimated under paragraph

(1), the President may determine that the eligible cost be the actual cost of such

repair, restoration, reconstruction, or replacement. The government or person

receiving assistance under this section shall reimburse the President for the

portion of such assistance that exceeds the eligible cost of such repair, restoration, reconstruction, or replacement.

‘‘(3) USE OF SURPLUS FUNDS.—In the event the actual cost of repairing, restoring, reconstructing, or replacing a facility under this section is less than 100

percent but not less than 80 percent of the cost estimated under paragraph (1),

the government or person receiving assistance under this section shall use any

surplus funds to perform activities that are cost-effective and reduce the risk

of future damage, hardship, or suffering from a major disaster.

‘‘(4) EXPERT PANEL.—Not later than 18 months after the date of enactment

of the Disaster Mitigation and Cost Reduction Act of 1999, the President, acting

through the Director of the Federal Emergency Management Agency, shall establish an expert panel, including representatives from the construction industry, to develop procedures for estimating the cost of repairing, restoring, reconstructing, or replacing a facility consistent with industry practices.

‘‘(5) SPECIAL RULE.—In any case in which the facility being repaired, restored,

reconstructed, or replaced under this section was under construction on the date

of the major disaster, the cost of repairing, restoring, reconstructing, or replacing such facility shall include, for purposes of this section, only those costs

which, under the contract for such construction, are the owner’s responsibility

and not the contractor’s responsibility.’’.

(2) EFFECTIVE DATE.—The amendment made by paragraph (1) shall take effect on the date of enactment of this Act, and shall only apply to funds appropriated after the date of enactment of this Act; except that paragraph (1) of section 406(e) of the Robert T. Stafford Disaster Relief and Emergency Assistance

Act (as amended by paragraph (1) of this subsection) shall take effect on the

date that the procedures developed under paragraph (3) of such section take effect.

(e) ASSOCIATED EXPENSES.—

(1) IN GENERAL.—Section 406 (42 U.S.C. 4172) is amended by striking subsection (f).

(2) OTHER ELIGIBLE COSTS.—Section 406(e) (42 U.S.C. 5172(e)), as amended

by subsection (d) of this section, is amended by adding at the end the following:

‘‘(6) OTHER ELIGIBLE COSTS.—For purposes of this section, other eligible costs

include the following:

‘‘(A) COSTS OF NATIONAL GUARD.—The cost of mobilizing and employing

the National Guard for performance of eligible work.

‘‘(B) COSTS OF PRISON LABOR.—The costs of using prison labor to perform

eligible work, including wages actually paid, transportation to a worksite,

and extraordinary costs of guards, food, and lodging.

‘‘(C) OTHER LABOR COSTS.—Base and overtime wages for an applicant’s

employees and extra hires performing eligible work plus fringe benefits on

such wages to the extent that such benefits were being paid before the disaster.’’.

(3) EFFECTIVE DATE.—Paragraphs (1) and (2) shall take effect on the date on

which the President establishes management cost rates under section 322(a) of

the Robert T. Stafford Disaster Relief and Emergency Assistance Act (as added

by section 201(a) of this Act). The amendment made by paragraph (1) shall only

apply to disasters declared by the President under such Act after the date on

which the President establishes such cost rates.

SEC. 203. FEDERAL ASSISTANCE TO INDIVIDUALS AND HOUSEHOLDS.

(a) IN GENERAL.—Section 408 (42 U.S.C. 5174) is amended to read as follows:
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‘‘SEC. 408. FEDERAL ASSISTANCE TO INDIVIDUALS AND HOUSEHOLDS.

‘‘(a) GENERAL AUTHORITY.—Subject to the requirements of this section, the President, in consultation with the Governor of the affected State, may provide financial

assistance, and, if necessary, direct services, to disaster victims who as a direct result of a major disaster have necessary expenses and serious needs where such victims are unable to meet such expenses or needs through other means.

‘‘(b) HOUSING ASSISTANCE.— ‘‘(1) ELIGIBILITY.—The President may provide financial or other assistance

under this section to individuals and families to respond to the disaster-related

housing needs of those who are displaced from their predisaster primary residences or whose predisaster primary residences are rendered uninhabitable as

a result of damage caused by a major disaster.

‘‘(2) DETERMINATION OF APPROPRIATE TYPES OF ASSISTANCE.—The President

shall determine appropriate types of housing assistance to be provided to disaster victims under this section based upon considerations of cost effectiveness,

convenience to disaster victims, and such other factors as the President may

consider appropriate. One or more types of housing assistance may be made

available, based on the suitability and availability of the types of assistance, to

meet the needs of disaster victims in the particular disaster situation.

‘‘(c) TYPES OF HOUSING ASSISTANCE.— ‘‘(1) TEMPORARY HOUSING.— ‘‘(A) FINANCIAL ASSISTANCE.— ‘‘(i) IN GENERAL.—The President may provide financial assistance

under this section to individuals or households to rent alternate housing accommodations, existing rental units, manufactured housing, recreational vehicles, or other readily fabricated dwellings.

‘‘(ii) AMOUNT.—The amount of assistance under clause (i) shall be

based on the fair market rent for the accommodation being furnished

plus the cost of any transportation, utility hookups, or unit installation

not being directly provided by the President.

‘‘(B) DIRECT ASSISTANCE.— ‘‘(i) IN GENERAL.—The President may also directly provide under this

section housing units, acquired by purchase or lease, to individuals or

households who, because of a lack of available housing resources, would

be unable to make use of the assistance provided under subparagraph

(A).

‘‘(ii) PERIOD OF ASSISTANCE.—The President may not provide direct

assistance under clause (i) with respect to a major disaster after the

expiration of the 18-month period beginning on the date of the declaration of the major disaster by the President, except that the President

may extend such period if the President determines that due to extraordinary circumstances an extension would be in the public interest.

‘‘(iii) COLLECTION OF RENTAL CHARGES.—After the expiration of the

18-month period referred to in clause (ii), the President may charge fair

market rent for the accommodation being provided.

‘‘(2) REPAIRS.—The President may provide financial assistance for the repair

of owner-occupied private residences, utilities, and residential infrastructure

(such as private access routes) damaged by a major disaster to a habitable or

functioning condition. A recipient of assistance provided under this paragraph

need not show that the assistance can be met through other means, except insurance proceeds, if the assistance is used for emergency repairs to make a private residence habitable and does not exceed $5,000 (based on fiscal year 1998

constant dollars).

‘‘(3) REPLACEMENT.—The President may provide financial assistance for the

replacement of owner-occupied private residences damaged by a major disaster.

Assistance provided under this paragraph shall not exceed $10,000 (based on

fiscal year 1998 constant dollars). The President may not waive any provision

of Federal law requiring the purchase of flood insurance as a condition for the

receipt of Federal disaster assistance with respect to assistance provided under

this paragraph.

‘‘(4) PERMANENT HOUSING CONSTRUCTION.—The President may provide financial assistance or direct assistance under this section to individuals or households to construct permanent housing in insular areas outside the continental

United States and other remote locations in cases in which—

‘‘(A) no alternative housing resources are available; and

‘‘(B) the types of temporary housing assistance described in paragraph (1)

are unavailable, infeasible, or not cost effective.

‘‘(d) TERMS AND CONDITIONS RELATING TO HOUSING ASSISTANCE.—
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‘‘(1) SITES.—Any readily fabricated dwelling provided under this section shall,

whenever possible, be located on a site complete with utilities, and shall be provided by the State or local government, by the owner of the site, or by the occupant who was displaced by the major disaster. Readily fabricated dwellings may

be located on sites provided by the President if the President determines that

such sites would be more economical or accessible.

‘‘(2) DISPOSAL OF UNITS.— ‘‘(A) SALE TO OCCUPANTS.— ‘‘(i) IN GENERAL.—Notwithstanding any other provision of law, a temporary housing unit purchased under this section by the President for

the purposes of housing disaster victims may be sold directly to the individual or household who is occupying the unit if the individual or

household needs permanent housing.

‘‘(ii) SALES PRICE.—Sales of temporary housing units under clause (i)

shall be accomplished at prices that are fair and equitable.

‘‘(iii) DEPOSIT OF PROCEEDS.—Notwithstanding any other provision of

law, the proceeds of a sale under clause (i) shall be deposited into the

appropriate Disaster Relief Fund account.

‘‘(iv) USE OF GSA SERVICES.—The President may use the services of

the General Services Administration to accomplish a sale under clause

(i).

‘‘(B) OTHER METHODS OF DISPOSAL.— ‘‘(i) SALE.—If not disposed of under subparagraph (A), a temporary

housing unit purchased by the President for the purposes of housing

disaster victims may be resold.

‘‘(ii) DISPOSAL TO GOVERNMENTS AND VOLUNTARY ORGANIZATIONS.—A

temporary housing unit described in clause (i) may also be sold, transferred, donated, or otherwise made available directly to a State or other

governmental entity or to a voluntary organization for the sole purpose

of providing temporary housing to disaster victims in major disasters

and emergencies if, as a condition of such sale, transfer, or donation,

the State, other governmental agency, or voluntary organization agrees

to comply with the nondiscrimination provisions of section 308 and to

obtain and maintain hazard and flood insurance on the housing unit.

‘‘(e) FINANCIAL ASSISTANCE TO ADDRESS OTHER NEEDS.— ‘‘(1) MEDICAL, DENTAL, AND FUNERAL EXPENSES.—The President, in consultation with the Governor of the affected State, may provide financial assistance

under this section to an individual or household adversely affected by a major

disaster to meet disaster-related medical, dental, and funeral expenses.

‘‘(2) PERSONAL PROPERTY, TRANSPORTATION, AND OTHER EXPENSES.—The President, in consultation with the Governor of the affected State, may provide financial assistance under this section to an individual or household described in

paragraph (1) to address personal property, transportation, and other necessary

expenses or serious needs resulting from the major disaster.

‘‘(f) STATE ROLE.—The President shall provide for the substantial and ongoing involvement of the affected State in administering the assistance under this section.

‘‘(g) MAXIMUM AMOUNT OF ASSISTANCE.—No individual or household shall receive

financial assistance greater than $25,000 under this section with respect to a single

major disaster. Such limit shall be adjusted annually to reflect changes in the Consumer Price Index for all Urban Consumers published by the Department of Labor.

‘‘(h) ISSUANCE OF REGULATIONS.—The President shall issue rules and regulations

to carry out the program, including criteria, standards, and procedures for determining eligibility for assistance.’’.

(b) CONFORMING AMENDMENT.—Section 502(a)(6) (42 U.S.C. 5192(a)(6)) is amended by striking ‘‘temporary housing’’.

(c) ELIMINATION OF INDIVIDUAL AND FAMILY GRANT PROGRAMS.—Title IV (42

U.S.C. 5170–5189a) is amended by striking section 411 (42 U.S.C. 5178).

(d) EFFECTIVE DATE.—The amendments made by this section shall take effect on

the 545th day following the date of enactment of this Act.

SEC. 204. REPEALS.

(a) COMMUNITY DISASTER LOANS.—Section 417 (42 U.S.C. 5184) is repealed.

(b) SIMPLIFIED PROCEDURE.—Section 422 (42 U.S.C. 5189) is repealed.

SEC. 205. STATE ADMINISTRATION OF HAZARD MITIGATION PROGRAM.

Section 404 (42 U.S.C. 5170c) is amended by adding at the end the following:

‘‘(c) PROGRAM ADMINISTRATION BY STATES.—

‘‘(1) IN GENERAL.—A State desiring to administer the hazard mitigation assistance program established by this section with respect to hazard mitigation
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assistance in the State may submit to the President an application for the delegation of such authority.

‘‘(2) CRITERIA.—The President, in consultation with States and local governments, shall establish criteria for the approval of applications submitted under

paragraph (1). The criteria shall include, at a minimum, the following:

‘‘(A) The demonstrated ability of the State to manage the grant program

under this section.

‘‘(B) Submission of the plan required under section 201(c).

‘‘(C) A demonstrated commitment to mitigation activities.

‘‘(3) APPROVAL.—The President shall approve an application submitted under

paragraph (1) that meets the criteria established under paragraph (2).

‘‘(4) WITHDRAWAL OF APPROVAL.—If, after approving an application of a State

submitted under paragraph (1), the President determines that the State is not

administering the hazard mitigation assistance program established by this section in a manner satisfactory to the President, the President shall withdraw

such approval.

‘‘(5) AUDITS.—The President shall provide for periodic audits of the hazard

mitigation assistance programs administered by States under this subsection.’’.

SEC. 206. STATE ADMINISTRATION OF DAMAGED FACILITIES PROGRAM.

(a) PILOT PROGRAM.—In cooperation with States and local governments and in coordination with efforts to streamline the delivery of disaster relief assistance, the

President shall conduct a pilot program for the purpose of determining the desirability of State administration of parts of the assistance program established by section

406 of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42

U.S.C. 5172).

(b) STATE PARTICIPATION.—

(1) CRITERIA.—The President may establish criteria in order to ensure the appropriate implementation of the pilot program under subsection (a).

(2) MINIMUM NUMBER OF STATES.—The President shall conduct the pilot program under subsection (a) in at least 2 States.

(c) REPORT.—Not later than 3 years after the date of enactment of this Act, the

President shall transmit to Congress a report describing the results of the pilot program conducted under subsection (a), including identifying any administrative or financial benefits. Such report shall also include recommendations on the conditions,

if any, under which States should be allowed the option to administer parts of the

assistance program under section 406 of the Robert T. Stafford Disaster Relief and

Emergency Assistance Act (42 U.S.C. 5172).

SEC. 207. STUDY REGARDING COST REDUCTION.

Not later than 3 years after the date of enactment of this Act, the Comptroller

General of the United States shall conduct a study to estimate the reduction in Federal disaster assistance that has resulted and is likely to result from the enactment

of this Act.

SEC. 208. REPORT ON ASSISTANCE TO RURAL COMMUNITIES.

Not later than 180 days after the date of enactment of this Act, the Director of

the Federal Emergency Management Agency shall prepare and transmit to Congress a report on methods and procedures that the Director recommends to accelerate the provision of Federal disaster assistance under the Robert T. Stafford Disaster Relief and Emergency Assistance Act (42 U.S.C. 5121 et seq.) to rural communities.

SEC. 209. STUDY REGARDING INSURANCE FOR PUBLIC INFRASTRUCTURE.

The Comptroller General of the United States shall conduct a study to determine

the current and future expected availability of disaster insurance for public infrastructure eligible for assistance under section 406 of the Robert T. Stafford Disaster

Relief and Emergency Assistance Act (42 U.S.C. 5170).

TITLE III—MISCELLANEOUS

SEC. 301. TECHNICAL CORRECTION OF SHORT TITLE.

The first section (42 U.S.C. 5121 note) is amended to read as follows:

‘‘SECTION 1. SHORT TITLE.

‘‘This Act may be cited as the ‘Robert T. Stafford Disaster Relief and Emergency

Assistance Act’.’’.
10

SEC. 302. DEFINITION OF STATE.

Section 102 (42 U.S.C. 5122) is amended in each of paragraphs (3) and (4) by

striking ‘‘the Northern’’ and all that follows through ‘‘Pacific Islands’’ and inserting

‘‘and the Commonwealth of the Northern Mariana Islands’’.

SEC. 303. FIRE SUPPRESSION GRANTS.

Section 420 (42 U.S.C. 5187) is amended by inserting ‘‘and local government’’ after

‘‘State’’.

PURPOSE AND SUMMARY

The purpose of H.R. 707, the ‘‘Disaster Mitigation and Cost Reduction Act of 1999,’’ is to amend the Robert T. Stafford Disaster

Relief and Emergency Assistance Act to authorize programs for

predisaster mitigation, to streamline the administration of disaster

relief, and to control the Federal costs of disaster assistance. The

bill authorizes a pre-disaster mitigation program through fiscal

year 2000. The bill also streamlines and modifies existing disaster

assistance programs.

BACKGROUND AND NEED FOR LEGISLATION

INTRODUCTION

The Disaster Mitigation and Cost Reduction Act of 1999 addresses two separate needs: increasing pre-disaster hazard mitigation

activities and reducing the cost of providing post-disaster assistance. The bill establishes a federally funded pre-disaster hazard

mitigation program and authorizes $105 million over two years for

helping fund cost-effective hazard mitigation activities. In addition,

the bill increases the authorization for post-disaster mitigation

funding by 33 percent (specifically, by increasing section 404’s eligible available funding level from 15 percent to 20 percent of the

total amount of disaster assistance provided). The bill also adopts

measures that will modify and streamline the current post-disaster

assistance program with the intention of reducing federal disaster

assistance costs without adversely affecting disaster victims.

The costs of natural disasters are increasing very rapidly. In the

last five years, the nation has been fortunate to avoid a major hurricane or earthquake, yet in that time over 800 people have been

killed by natural disasters. These disasters also inflicted over $60

billion in property losses and other damage. The data indicate

these losses are likely to increase. For the ten-year period prior to

1989, total obligations from the Federal Emergency Management

Agency’s (FEMA’s) Disaster Relief Fund were $4 billion; since

1989, FEMA has spent $21 billion. Prior to 1989, only one disaster

event (Hurricane Agnes in 1972) cost over $500 million in FEMA

funds. Since 1989, every year, except 1991, has had at least one

disaster event costing more than $500 million in FEMA assistance.

In fact, six of these events have occurred since 1993.

HAZARD MITIGATION

There are two primary ways to reduce the cost of natural disasters. One is to take measures that reduce our nation’s vulnerability

to hazards, also known as hazard mitigation. Historically, federal,

state, and local governments have focused on assisting the victims

of disasters after the damage is done. As the cost of the damages
11

and assistance have increased, however, governments have started

to change their spending priorities. Between 1992 and 1996, a period of only four years, state spending on mitigation measures increased by more than four fold to an average of $16 million per

state. Realizing that the only way to control post-disaster spending

for response, relief, and recovery is to increase pre-disaster funding

for mitigation, planning and preparedness, states now spend as

much money on preparing for a disaster as they do in its aftermath. In contrast, the federal government still spends three dollars

on post-disaster assistance for every dollar it spends on mitigation

(including the maintenance of flood control structures such as levees and dams).

Private insurers are also aware of the need for hazard mitigation. Funded through the Institute for Building and Home Safety,

private insurers recently established the ‘‘Showcase Communities’’

program to demonstrate the benefits of taking specific, creative

steps within an entire community to reduce the losses caused by

natural disasters. States such as New York and Florida are implementing similar programs. FEMA also sponsors such a program

called Project Impact. The goal of Project Impact is to bring communities together to take actions that prepare for—and protect

themselves against—natural disaster in a collaborative effort. Over

100 communities have been designated Project Impact sites.

STREAMLINING AND COST REDUCTION

Other than hazard mitigation, the costs of disasters can be reduced by making current disaster programs more efficient. The bill

attempts to increase the efficiency of existing disaster assistance

programs by eliminating unnecessary and complicated aspects of

the program. This includes streamlining the management cost reimbursement requirements (section 201) and combining the housing, and individual and family assistance programs (section 203).

In addition, the bill would condition infrastructure assistance offered to private-nonprofit organizations not providing critical services on their applying to the Small Business Administration for a

disaster assistance loan (section 202). This requirement mimics a

requirement already in place for individuals or families seeking

federal disaster grant assistance.

CONCLUSION

The expectation is that the two themes of this bill—greater emphasis on mitigation and greater program efficiency—will reduce

the costs natural disasters place on the nation. To help Congress

determine whether the bill achieves this objective, the bill includes

a provision (section 207) requiring that three years from enactment, the General Accounting Office estimate the cost savings resulting from these amendments.
12

DISCUSSION OF COMMITTEE BILL AND SECTION-BY-SECTION

ANALYSIS

TITLE I—PREDISASTER HAZARD MITIGATION

Section 101. Findings and purpose

Describes findings and a purpose applicable to Title I of the bill.

Subsection (a) makes four findings: (1) greater emphasis needs to

be placed on hazard identification and hazard mitigation, (2) expenditures for disaster assistance are increasing without any reduction in the likelihood of future losses, (3) a high priority should

be placed on the implementation of predisaster hazard mitigation

activities, and (4) a unified effort of economic incentives, awareness

and education, technical assistance, and Federal support will enable states and local communities to form partnerships and implement effective mitigation measures that will reduce the risk of future damage to life and property. In preparing hazard mitigation

programs the bill’s findings recognize the importance for states and

local communities to identify those long-term predisaster mitigation measures (including construction practices and materials) in

new and existing structures. Additionally, a unified support effort

will ensure that critical facilities and public infrastructure are able

to function after a disaster strikes.

Subsection (b) states the purpose of Title I of the bill. The purpose is to (1) establish a program to reduce the loss of life, property, and other costs of disasters and (2) provide a source of

predisaster mitigation funding to assist states and local governments in implementing mitigation measures.

Section 102. State mitigation program

Amends subsection 201(c) of the Robert T. Stafford Disaster Relief and Emergency Assistance Act (Stafford Act) to require, as a

condition for receiving federal grants under such section, that

states submit to the President a comprehensive program for mitigating against disasters, including provisions for prioritizing mitigation activities. An important part of this program are provisions

for prioritizing mitigation measures. A key aspect of a successful

mitigation program is focusing resources on those activities that result in the greatest benefits. The state programs must include a

method for identifying such activities.

This reporting requirement is not intended to duplicate or conflict with any existing reporting requirements currently submitted

to the President by state governments including so-called ‘‘409 Reports’’ (reports currently required by FEMA under the authority of

section 409 of the Stafford Act). Consistent with the Paperwork Reduction Act of 1986, this provision is intended to be implemented

so that the minimum burden is placed on states in fulfilling this

new reporting requirement.

Section 103. Disaster assistance plans

Amends subsection 201(d) of the Stafford Act to authorize grants

for the testing and application of floodplain mapping technologies

that the President determines will likely result in substantial savings over current floodplain mapping methods. The Committee
13

notes that many floodplain maps are out of date or of poor quality

and that new technologies are available that can produce extremely

accurate maps at much less cost than in the past.

Section 104. Predisaster hazard mitigation

Creates a new section 203 in the Stafford Act, with the following

subsections:

(a) GENERAL AUTHORITY.—Provides the legislative authority for

pre-disaster mitigation grants from the President to state and local

governments.

(b) PURPOSES OF ASSISTANCE.—Grants are primarily intended to

fund activities that are cost-effective and substantially reduce the

risk of future damage, hardship, or suffering from a major disaster.

These activities include any work directly related to the activity

needed to meet federal requirements such as, but not limited to,

environmental or benefit-cost analyses. State or local governments

may spend up to 10 percent of federal assistance to fund activities

to disseminate information regarding cost-effective mitigation technologies. The Committee urges communities to examine technologies which have proven to be effective in mitigating the risks

or impacts of actual natural disasters. This would include construction practices and materials such as passive design systems for

roofs, walls and windows.

(c) ALLOCATION OF FUNDS.—All eligible states shall receive as- sistance. No state would receive less than the lesser of $500,000 or

1 percent of the total funds appropriated for these grants in a given

fiscal year. No state would receive more than 15 percent of total

funds appropriated for these grants in a given fiscal year.

(d) CRITERIA.—In deciding who to award grants to (and the

amount of such grants), the President must consider seven criteria

in addition to any other criteria the President may establish: (1)

clear identification of cost-effective mitigation activities that

produce meaningful and definable outcomes, (2) whether the state

has submitted a mitigation program as required under section

201(c) as amended, (3) the extent to which assistance will fund activities that mitigate hazards evaluated under Section 409, (4) the

opportunity to fund activities that maximize net benefits to society,

(5) the ability of the state or local government to fund mitigation

activities, (6) whether the assistance helps a small impoverished

community, and (7) the level of interest of the private sector in entering into a partnership to promote mitigation.

In addition, it is the Committee’s expectation that the number of

additional factors, if any, that may be established by the President

will be small so that these factors will continue to be important in

controlling how funds are allocated. The Committee encourages the

President to establish an analytical system for ranking possible

candidates by these criteria including appropriate weighting of the

factors. As an example, the Environmental Protection Agency has

established such a system for allocating grants under section 319

of the Clean Water Act.

The Committee further notes that the second criterion, consistency with a state mitigation program submitted in cooperation

with local governments, should include consideration of the cooperation exhibited between the relevant city and county govern-
14

ments. Conflict between local governments may indicate a problem

that may need to be addressed further before funding is provided.

(e) STATE NOMINATIONS.—Every year, states may nominate five

or more local governments to the President for predisaster mitigation assistance. The President must select from such nominations

unless the President determines extraordinary circumstances justify selecting another site (for instance, if the state’s nominees rank

low on all or most of the criteria delineated in subsection (d) compared to other communities in the state, or if a state’s nominees

are on probation for violations in the flood insurance program). If

a state does not submit nominations in a timely fashion, the President may provide assistance to any local governments in the state

using the criteria established in subsection (d).

(f) SMALL IMPOVERISHED COMMUNITIES.—Small impoverished

communities are defined as communities of 3,000 or fewer individuals that are economically disadvantaged. In developing a definition to implement this provision, the Committee suggests the President use, as a starting point, the definition of small impoverished

communities established to implement the Hardship Grants Program for Rural Communities contained in the Omnibus and Appropriations Act of 1996 (P.L. 104–134) (see 62 Federal Register

13521, March 20, 1997, for more information).

(g) FEDERAL SHARE.—The grants may cover up to 75 percent of

the cost of mitigation proposals funded by the President. Grants for

small impoverished communities may cover up to 90 percent of the

cost of mitigation activities.

(h) AUTHORIZATION.—There is authorized to be appropriated for implementing this section $25 million for fiscal year 1999, and $80

million for fiscal year 2000.

(i) AUTHORIZATION OF SECTION 404 FUNDS.—Effective October 1,

2000, in addition to amounts appropriated under subsection (h)

from only appropriations enacted after October 1, 2000, funds appropriated under section 404 of the Stafford Act (post-disaster mitigation grants) that are not obligated within 30 months of the disaster which triggered their initial appropriation, may be used for the

predisaster mitigation program authorized by this section. The

Committee notes that these funds remain available to both the 404

and the predisaster mitigation program. The availability of these

funds for predisaster mitigation does not foreclose their use for the

originally intended purpose. The Committee encourages FEMA to

use such funding under the 404 program if the obligation of such

funds is imminent. The redirection of these funds is not mandatory.

The Committee also expects FEMA to segregate funds appropriated

before FY 2000 to ensure this section does not affect previously appropriated funds.

(j) REPORT ON STATE ADMINISTRATION.—Within 18 months of the

enactment of this Act, the President shall submit a report to Congress (1) evaluating the implementation of this section and (2) recommending a process for transferring greater authority and responsibility for administering the predisaster mitigation program

to capable state governments. Understanding that mitigation efforts must be local, the Committee intends that, as state capabilities improve, this program should be increasingly delegated to the

states. In the future it may be desirable to modify the statutory
15

provisions of this program to facilitate an expanded role for State

and local governments to administer this program. The Committee

considers the increasing state administration of the post-disaster

mitigation program under section 404 as evidence that states will

be capable of administering this program, as well.

Section 105. Interagency task force

Directs the President to establish an interagency task force,

chaired by FEMA, for the purpose of coordinating the implementation of the predisaster mitigation program. The Committee notes

the possibility of overlap of this program with other programs implemented by other agencies. The task force should ensure this program and the other programs are complementary and integrated.

Section 106. Maximum contribution for mitigation costs

Increases the authorization for post-disaster mitigation funding

from 15 percent of the estimated aggregate amount of assistance

provided under the Stafford Act for a Major Disaster to 20 percent

of the amount of such assistance.

Section 107. Conforming amendment

Adds the term ‘‘Mitigation’’ to title II of the Stafford Act.

TITLE II—STREAMLINING AND COST REDUCTION

Section 201. Management costs

Adds a new section 322 to the Stafford Act. Provides that a certain percentage, or rate, of management costs will be reimbursed.

The percentages will be established by regulation. Management

costs include any indirect, administrative, or associated costs or expenses currently reimbursed by FEMA except for National Guard,

prison labor, and other labor costs which will be treated as eligible

costs. The current reimbursement system will remain in effect for

disasters declared before such rates are established. The rates

would be reviewed by the President periodically.

Section 202. Assistance to repair, restore, reconstruct, or replace

damaged facilities

Amends and reorganizes section 406 of the Stafford Act as follows:

(a) CONTRIBUTIONS.—Requires private nonprofit organizations

which are eligible for Stafford Act permanent restorative assistance

to apply for Small Business Administration (SBA) disaster loans

before they can receive grant assistance from FEMA. This requirement does not apply if a facility provides critical services in the

event of a major disaster. The term critical services includes, but

is not limited to, power, water, sewer, wastewater treatment, communications and emergency medical care. It is the Committee’s understanding that SBA is already well prepared to implement this

provision and examine such applications without undue delay.

(b) MINIMUM FEDERAL SHARE.—Amends subsection 406(b) to

comport with the amendment made by section 201 above.

(c) LARGE IN-LIEU CONTRIBUTIONS.—Rewrites section 406(c) to

reduce from 90 percent to 75 percent (of the otherwise eligible
16

amount) the contribution of the federal share (henceforth ‘‘contribution level’’) available to public and private nonprofit entities which

choose to carry out alternate projects following major disasters. The

President is required to modify the 75 percent contribution level if

the President determines another contribution level will reduce the

total amount of federal assistance under this section. However, the

federal share may not be set below 50 percent or higher than 90

percent.

The Committee intends that the level set by the President be

generally applicable, it is not intended to be adjusted on a case by

case basis. Further, an alternative level set by the President must

be supported by adequate data. The Committee notes that the relationship between the contribution level and the expected federal

cost is currently unknown. For purposes of illustration, the figure

below indicates three of the many possible relationships between

these parameters. The first hypothetical relationship (the curve

marked ‘‘1’’) would indicate the President should select a contribution level at or slightly below the new 75 percent level. The relationship marked ‘‘2’’ would lead to a contribution level of 50 percent. The relationship marked ‘‘3’’ would result in a contribution

level of 90 percent. It is expected that if the President receives data

and other information of sufficient quality to determine that an alternative contribution level will reduce federal costs, the President

shall adopt such a contribution level. The Committee does not intend that the contribution level be altered frequently, but that such

changes be made after careful consideration and based on solid

data.

insert offset folio 22 here
17

(d) ELIGIBLE COST.—Amends subsection 406(e) to allow the eligible cost of repair, restoration, reconstruction, or replacement to be

based on a cost estimate rather than actual cost incurred. However,

if the estimate differs from the actual cost by more than 20 percent

the President may use the actual cost as the eligible cost. The

Committee expects that estimates that exceed actual costs by more

than 20 percent will result in the reimbursement of the difference

to the federal government while estimates that underestimate actual costs by more than 20 percent will result in additional assistance to the victim of the disaster to be used in the costs of repairs

and development of methods to reduce future possible risk. This

section also establishes a panel of experts to develop a cost estimating procedure. The Committee expects the panel will include licensed professionals from the construction industry, government,

and academia representing metropolitan and rural interests from

the various geographic regions in the country. This amendment to

the Stafford Act should not affect funds appropriated prior to FY

2000. The Committee expects FEMA will segregate pre-FY 2000

funding in order to implement this section.

(e) ASSOCIATED EXPENSES.—Eliminates subsection 406(f), relating to associated expenses, to comport with the amendment made

by section 201 of the bill. Subsections (3), (4), and (5) of 406(f) are

moved into section 406(e). This should result in no change in the

level of reimbursement for National Guard, prison labor, and other

labor that States receive under current law.

Section 203. Federal assistance to individuals and households

Amends section 408 of the Stafford Act to combine the Housing

and Individual and Family Grant (IFG) Programs. The amendment

sets the federal cost share for both programs at 100%,and continues the requirement that applicants for individual and family

grants show that assistance is not available by other means before

seeking assistance and caps total assistance for the combined program at $25,000. The section allows the President to assist individuals by replacing their homes under certain conditions. Also, victims seeking assistance for minimal emergency home repair need

only show that the damage is not covered by insurance in order to

be eligible for assistance for such repairs not exceeding $5,000.

New subsection section 408(e) authorizes grants for medical, dental, funeral, and other expenses that are disaster related. In particular, paragraph (2) of this subsection provides authority for the

President to provide financial assistance to individuals or households for meeting serious needs resulting from a major disaster. Serious needs are requirements for an item or service essential to

prevent, mitigate, or overcome a disaster-related hardship or injury. Such needs typically include clothing and transportation.

New subsection 408(f) requires the President to provide for substantial and continuing involvement of the State in administering

this program. Administrative and other indirect costs incurred by

the State in implementing this section shall be reimbursable under

the rates established in section 322 of the Stafford Act as amended

by section 201 of this bill.
18

Section 204. Repeals

Repeals section 417 of the Stafford Act (providing for Community

Disaster Loans). Also repeals section 422 (Simplified Procedure) in

order to conform with the amendment made under section 202(d)

of the bill.

Section 205. State administration of hazard mitigation program

Requires the President to establish a process for offering states

the option of administering the Hazard Mitigation Grant Program

(section 404) program. The President shall set the criteria for such

a program and perform periodic audits in those cases where the

program is administered by a state.

Section 206. State administration of damaged facilities program

Requires the President to conduct in at least 2 states a pilot program allowing states to administer parts of the Public Assistance

(section 406) program. This could include, but is not limited to, the

state independently validating estimates, verifying applicants’ eligibility, and/or providing technical assistance. The President must

report on the results including any streamlining or cost savings

that resulted from the program. This program is not intended to

conflict with FEMA’s current efforts to streamline the public assistance program, but is intended to be coordinated with such efforts.

Section 207. Study regarding cost reduction

Directs the General Accounting Office (GAO) to estimate the reduction in federal disaster assistance that results from the enactment of this Act.

Section 208. Report on assistance for rural communities

Directs FEMA to prepare and evaluate more efficient methods of

providing disaster relief to rural communities.

Section 209. Study regarding insurance for public infrastructure

Directs GAO to determine the current and future availability of

insurance for public infrastructure.

TITLE III—MISCELLANEOUS

Section 301. Technical correction of short title

Deletes the extra ‘‘The’’ from the title of the Act.

Section 302. Definition of State

Updates the definition of ‘‘state’’ in the Stafford Act to comport

with current law.

Section 303. Fire suppression grants

Amends Section 420 (42 U.S.C. 5187) by inserting ‘‘and local government’’ after ‘‘State’’ so that local governments will also be eligible for fire suppression grants. Currently, only states are eligible

for such grants.
19

HEARINGS

The Committee has not held hearings on the reported legislation.

However, in the 105th Congress, the Subcommittee on Water Resources and Environment held several days of hearings on disaster

assistance and hazard mitigation including draft legislation substantially similar to H.R. 707.

In the 105th Congress, the Subcommittee on Water Resources

and Environment held hearings on the two issue areas addressed

by the bill: hazard mitigation and the federal costs of disasters. On

January 28, 1998, the Subcommittee held a hearing on hazard

mitigation. Witnesses included representatives from FEMA, the

National Emergency Management Association, Los Angeles County,

and American Rivers. The witnesses provided testimony on importance of focusing more resources on pre-disaster mitigation.

On March 26, 1998, the Subcommittee held a hearing on the federal cost of disaster assistance. Witnesses included representatives

from FEMA, the General Accounting Office, the National Emergency Management Association, the Association of State Floodplain

Managers, the National League of Cities, and others. The witnesses

generally noted the increasing costs of disasters and offered methods for reducing such costs.

On March 30, 1998, a draft bill addressing these two issues was

released for public comment. A revised draft bill reflecting comments received by the Subcommittee was released on May 1, 1998.

The Subcommittee held a legislative hearing on the draft bill on

May 7, 1998. Witnesses included FEMA, the National Emergency

Management Association, the Association of State Floodplain Managers, the National League of Cities, and the International Association of Emergency Managers.

The draft language was further amended and introduced as H.R.

3869 on May 14, 1998 by Representative Sherwood Boehlert and

Representative Robert Borski. The bill was referred solely to the

Committee on Transportation and Infrastructure.

COMMITTEE CONSIDERATION

H.R. 707 is substantially similar to H.R. 3869, which, by voice

vote, was reported by the Committee in the 105th Congress. H.R.

707 was introduced on February 11, 1999 by Congresswoman Tillie

K. Fowler, and Congressmen James A. Traficant, Sherwood L.

Boehlert, and, Robert A. Borski.

On February 24, 1999, the Subcommittee on Oversight, Investigations, and Emergency Management favorably reported the bill

with a technical amendment to the Full Committee by unanimous

voice vote, a quorum being present.

On March 2, 1999, the Full Committee adopted by voice vote an

amendment offered by Representative Tillie Fowler modifying sections 104 and 202 of the bill. The amendment prohibited changes

made by these sections from affecting funds appropriated prior to

fiscal year 2000. The Full Committee also adopted by voice vote an

amendment offered by Representative Lee Terry exempting certain

private nonprofit organizations from having to apply to the Small

Business Administration as a condition of receiving FEMA assist-
20

ance. Subsequently, the Full Committee ordered reported H.R. 707,

as amended, unanimously by voice vote, a quorum being present.

ROLL CALL VOTES

Clause 3(b) of rule XIII requires each committee report to include

the total number of votes cast for and against on each roll call vote

on a motion to report and on any amendment offered to the measure or matter, and the names of those members voting for and

against. There were no recorded votes taken in connection with ordering H.R. 707 reported. A motion by Mrs. Tillie Fowler to order

H.R. 707 reported to the House, with amendments, was unanimously agreed to by voice vote, a quorum being present.

COST OF THE LEGISLATION

Clause 3(d)(2) of rule XIII of the Rules of the House of Representatives is satisfied where a cost estimate and comparison prepared by the Director of the Congressional Budget Office (CBO)

under section 402 of the Congressional Budget Act of 1974 has

been timely submitted prior to the filing of the report and is included in the report. The Committee has received no cost estimate

and comparison. When available it will be printed in the Congressional Record.

The Committee estimates that implementing H.R. 707 would re- sult in a reduction in discretionary outlays of $109 million over the

2000—2004 period. This estimate is based on the cost estimate provided by CBO for H.R. 3869 which was reported out of the Committee in the 105th Congress and is substantially similar to H.R. 707.

The Committee has modified the estimate to reflect changes between H.R. 707 and H.R. 3869 which are discussed in detail below.

In addition the Committee has estimated that each $1 spent on

mitigation will result, on average, in $1 in savings. The Committee

considers this a conservative estimate because, as described below,

FEMA estimates mitigation measures return $3 for each $1 invested. However, the Committee also recognizes the time horizon

for such a return is on the order of 10 to 20 years and, therefore,

concludes that a $1 for $1 estimate may be a more accurate estimate of the return over the next several years. As noted below,

CBO did not attempt to estimate any savings from mitigation activities authorized by the bill. A summary of the calculation of the

Committee’s cost estimate is shown in the table below:

[In millions of dollars]

Line Item Amount

CBO estimate for H.R. 3869 ................................................................................. ¥600

Reduction in authorization level in H.R. 707 ...................................................... +95

Exemption for certain nonprofits under section 202(a) ...................................... ¥6

Assume $1 in savings for every $1 in mitigation spending (not estimated by

CBO) .................................................................................................................... +620

Total Savings .................................................................................................. $109

There are three significant differences between H.R. 3869 and H.R.

707 that the Committee took into consideration in modifying the

CBO cost estimate for H.R. 3869 to reflect H.R. 707.

First, the authorization levels for the pre-disaster mitigation program have been reduced by $95 million. This would reduce the

overall cost of the bill by this amount.
21

Second, the CBO cost estimate for H.R. 3869 concluded that section 104 of H.R. 3869 (similar to section 104 of H.R. 707) would result in an effect on direct spending by speeding up the disbursement of some existing disaster relief funds. H.R. 707 has been

modified by the Committee to eliminate any effect on direct spending.

Finally, an amendment adopted by the Committee exempting

certain private nonprofit organizations from having to apply to the

Small Business Administration for a loan as a condition of receiving assistance (section 202(a) of H.R. 3869 and H.R. 707) is expected to increase the cost of the bill by $3 million to $9 million

a year compared to H.R. 3869.

The Committee notes that subsequent review of the CBO cost estimate for H.R. 3869 indicates that section 202(d) of H.R 3869

(similar to section 202(d) of H.R. 707) could also have been interpreted to affect direct spending. The Committee has modified H.R.

707 to eliminate this potential effect.

As the Committee noted last year the CBO estimate explicitly

omited significant benefits of the legislation because CBO was unable to quantify these benefits. For instance:

CBO did not quantify the benefits of mitigation activities (which

CBO notes ‘‘could lead to substantial savings’’) because ‘‘we cannot

predict either the frequency or incidence of major natural disasters.’’ The Committee believes these benefits will be significant. On

May 7, 1998 the Federal Emergency Management Agency testified

that mitigation measures return $3 for every $1 spent. Further, the

bill requires that all mitigation activities be cost-effective.

CBO was unable to quantify administrative cost reductions resulting from combining the Housing, and Individual and Family

grant programs under section 203 of the bill. CBO states this provision is ‘‘likely to result in some savings’’ but ‘‘CBO has no basis for

estimating the likely amount of such savings.’’ The Committee believes the savings may be significant. FEMA estimated the savings

of a similar provision at $700 million over 5 years.

The Committee is assuming each dollar spent on mitigation will

result in at least one dollar in savings. The Committee is not attempting to estimate any savings from administrative cost reductions and, therefore, considers this a conservative estimate of the

bill’s savings.

COMPLIANCE WITH HOUSE RULE XIII

1. Pursuant to clause 3(c)(1) of rule XIII of the Rules of the

House of Representatives, oversight findings and recommendations

have been made by the Committee as reflected in this report.

2. With respect to the requirement of clause 3(c)(2) of rule XIII

of the Rules of the House of Representatives, and 308(a) of the

Congressional Budget Act of 1974, the Committee references the

report of the Congressional Budget Office has not been received.

When available, it will be printed in the Congressional Record.

3. With respect to the requirement of clause 3(c)(4) of rule XIII

of the Rules of the House of Representatives, the Committee has

received no report of oversight findings and recommendations from

the Committee on Government Reform on the subject of H.R. 707.
22

4. With respect to the requirement of clause 3(c)(3) of rule XIII

of the Rules of the House of Representatives and section 402 of the

Congressional Budget Act of 1974, a cost estimate from the Director of the Congressional Budget Office (CBO) is not available.

CONSTITUTIONAL AUTHORITY STATEMENT

Pursuant to clause 3(d)(1) of rule XIII of the Rules of the House

of Representatives, committee reports on a bill or joint resolution

of a public character shall include a statement citing the specific

powers granted to the Congress in the Constitution to enact the

measure. The Committee on Transportation and Infrastructure

finds that Congress has the authority to enact this measure pursuant to its powers granted under article I, section 8 of the Constitution.

FEDERAL MANDATES STATEMENT

Pursuant to section 423 of the Unfunded Mandates Reform Act

(P.L. 104–4), the Committee finds that H.R. 707 imposes no federal

mandates.

ADVISORY COMMITTEE STATEMENT

No advisory committees within the meaning of section 5(b) of the

Federal Advisory Committee Act were created by this legislation.

APPLICABILITY TO THE LEGISLATIVE BRANCH

The Committee finds that the legislation does not relate to the

terms and conditions of employment or access to public services or

accommodations within the meaning of section 102(b)(3) of the Congressional Accountability Act (P.L. 104–1).

CHANGES IN EXISTING LAW MADE BY THE BILL, AS REPORTED

In compliance with clause 3(e) of rule XIII of the Rules of the

House of Representatives, changes in existing law made by the bill,

as reported, are shown as follows (existing law proposed to be omitted is enclosed in black brackets, new matter is printed in italic,

existing law in which no change is proposed is shown in roman):

THE ROBERT T. STAFFORD DISASTER RELIEF AND

EMERGENCY ASSISTANCE ACT

Be it enacted by the Senate and House of Representatives of the

United States of America in Congress assembled, øThat this Act

may be cited as the ‘‘The Robert T. Stafford Disaster Relief and

Emergency Assistance Act’’.¿

SECTION 1. SHORT TITLE.

This Act may be cited as the ‘‘Robert T. Stafford Disaster Relief

and Emergency Assistance Act’’.

* * * * * * *

TITLE I—FINDINGS, DECLARATIONS, AND DEFINITIONS

* * * * * * *
23

DEFINITIONS

SEC. 102. As used in this Act—

(1) * * *

* * * * * * *

(3) ‘‘United States’’ means the fifty States, the District of Columbia, Puerto Rico, the Virgin Islands, Guam, American

Samoa, øthe Northern Mariana Islands, and the Trust Territory of the Pacific Islands¿ and the Commonwealth of the

Northern Mariana Islands.

(4) ‘‘State’’ means any State of the United States, the District

of Columbia, Puerto Rico, the Virgin Islands, Guam, American

Samoa, øthe Northern Mariana Islands, and the Trust Territory of the Pacific Islands¿ and the Commonwealth of the

Northern Mariana Islands.

* * * * * * *

øTITLE II—DISASTER PREPAREDNESS ASSISTANCE¿

TITLE II—DISASTER PREPAREDNESS

AND MITIGATION ASSISTANCE

FEDERAL AND STATE DISASTER PREPAREDNESS PROGRAMS

SEC. 201. (a)***

* * * * * * *

(c) Upon application by a State, the President is authorized to

make grants, not to exceed in the aggregate to such State $250,000,

for the development of plans, programs, and capabilities for disaster preparedness and prevention. Such grants shall be applied for

within one year from the date of enactment of this Act. Any State

desiring financial assistance under this section shall designate or

create an agency to plan and administer such a disaster preparedness program, and shall, through such agency, submit a State plan

to the President, which shall—

(1) set forth a comprehensive and detailed State program for

preparation against and assistance following, emergencies and

major disasters, including provisions for assistance to individuals, businesses, and local governments; øand¿

(2) include provisions for appointment and training of appropriate staffs, formulation of necessary regulations and procedures and conduct of required exercisesø.¿; and

(3) set forth, with the ongoing cooperation of local governments and consistent with section 409, a comprehensive and detailed State program for mitigating against emergencies and

major disasters, including provisions for prioritizing mitigation

measures.

ø(d) The President is authorized to make grants not to exceed 50

per centum of the cost of improving, maintaining and updating

State disaster assistance plans, including evaluations of natural

hazards and development of the programs and actions required to
24

mitigate such hazards, except that no such grant shall exceed

$50,000 per annum to any State.¿

(d) GRANTS FOR DISASTER ASSISTANCE AND HAZARD IDENTIFICA- TION.—The President is authorized to make grants for—

(1) not to exceed 50 percent of the cost of improving, maintaining, and updating State disaster assistance plans including, consistent with section 409, evaluation of natural hazards

and development of the programs and actions required to mitigate such hazards; and

(2) the development and application of improved floodplain

mapping technologies that can be used by Federal, State, and

local governments and that the President determines will likely

result in substantial savings over current floodplain mapping

methods.

* * * * * * *

SEC. 203. PREDISASTER HAZARD MITIGATION.

(a) GENERAL AUTHORITY.—The President may establish a program to provide financial assistance to States and local governments for the purpose of undertaking predisaster hazard mitigation

activities that are cost effective and substantially reduce the risk of

future damage, hardship, or suffering from a major disaster.

(b) PURPOSE OF ASSISTANCE.— (1) IN GENERAL.—Except as provided in paragraph (2), a

State or local government that receives financial assistance

under this section shall use the assistance for funding activities

that are cost effective and substantially reduce the risk of future

damage, hardship, or suffering from a major disaster.

(2) DISSEMINATION.—The State or local government may use

not more than 10 percent of financial assistance it receives

under this section in a fiscal year for funding activities to disseminate information regarding cost effective mitigation technologies (such as preferred construction practices and materials), including establishing and maintaining centers for protection against natural disasters to carry out such dissemination.

(c) ALLOCATION OF FUNDS.—The amount of financial assistance to

be made available to a State, including amounts made available to

local governments of such State, under this section in a fiscal year

shall—

(1) not be less than the lesser of $500,000 or 1.0 percent of

the total funds appropriated to carry out this section for such

fiscal year; but

(2) not exceed 15 percent of such total funds.

(d) CRITERIA.—Subject to the limitations of subsections (c) and (e),

in determining whether to provide assistance to a State or local government under this section and the amount of such assistance, the

President shall consider the following criteria:

(1) The clear identification of prioritized cost-effective mitigation activities that produce meaningful and definable outcomes.

(2) If the State has submitted a mitigation program in cooperation with local governments under section 201(c), the degree to which the activities identified in paragraph (1) are consistent with the State mitigation program.
25

(3) The extent to which assistance will fund activities that

mitigate hazards evaluated under section 409.

(4) The opportunity to fund activities that maximize net benefits to society.

(5) The ability of the State or local government to fund mitigation activities.

(6) The extent to which assistance will fund mitigation activities in small impoverished communities.

(7) The level of interest by the private sector to enter into a

partnership to promote mitigation.

(8) Such other criteria as the President establishes in consultation with State and local governments.

(e) STATE NOMINATIONS.— (1) IN GENERAL.—The Governor of each State may recommend to the President not less than 5 local governments to

receive assistance under this section. The recommendations

shall be submitted to the President not later than October 1,

1999, and each October 1st thereafter or such later date in the

year as the President may establish. In making such recommendations, the Governors shall consider the criteria identified in subsection (d).

(2) USE.— (A) GENERAL RULE.—In providing assistance to local governments under this section, the President shall select from

local governments recommended by the Governors under

this subsection.

(B) WAIVER.—Upon request of a local government, the

President may waive the limitation in subparagraph (A) if

the President determines that extraordinary circumstances

justify the waiver and that granting the waiver will further

the purpose of this section.

(3) EFFECT OF FAILURE TO NOMINATE.—If a Governor of a

State fails to submit recommendations under this subsection in

a timely manner, the President may select, subject to the criteria in subsection (d), any local governments of the State to receive assistance under this section.

(f) SMALL IMPOVERISHED COMMUNITIES.—For the purpose of this

section, the term ‘‘small impoverished communities’’ means communities of 3,000 or fewer individuals that are economically disadvantaged, as determined by the State in which the community is located

and based on criteria established by the President.

(g) FEDERAL SHARE.—Financial assistance provided under this

section may contribute up to 75 percent of the total cost of mitigation activities approved by the President; except that the President

may contribute up to 90 percent of the total cost of mitigation activities in small impoverished communities.

(h) AUTHORIZATION OF APPROPRIATIONS.—There is authorized to

be appropriated to carry out this section $25,000,000 for fiscal year

1999 and $80,000,000 for fiscal year 2000.

(i) AUTHORIZATION OF SECTION 404 FUNDS.—Effective October 1,

2000, in addition to amounts appropriated under subsection (h)

from only appropriations enacted after October 1, 2000, the President may use, to carry out this section, funds that are appropriated

to carry out section 404 for post-disaster mitigation activities that
26

have not been obligated within 30 months of the disaster declaration upon which the funding availability is based.

(j) REPORT ON FEDERAL AND STATE ADMINISTRATION.—Not later

than 18 months after the date of enactment of the Disaster Mitigation and Cost Reduction Act of 1999, the President, in consultation

with State and local governments, shall transmit to Congress a report evaluating efforts to implement this section and recommending

a process for transferring greater authority and responsibility for

administering the assistance program authorized by this section to

capable States.

TITLE III—MAJOR DISASTER AND

EMERGENCY ASSISTANCE ADMINISTRATION

* * * * * * *

SEC. 322. MANAGEMENT COSTS.

(a) IN GENERAL.—Notwithstanding any other provision of law (including any administrative rule or guidance), the President shall establish by rule management cost rates for grantees and subgrantees.

Such rates shall be used to determine contributions under this Act

for management costs.

(b) MANAGEMENT COSTS DEFINED.—Management costs include indirect costs, administrative expenses, associated expenses, and any

other expenses not directly chargeable to a specific project under a

major disaster, emergency, or emergency preparedness activity or

measure. Such costs include the necessary costs of requesting, obtaining, and administering Federal assistance and costs incurred by

a State for preparation of damage survey reports, final inspection

reports, project applications, final audits, and related field inspections by State employees, including overtime pay and per diem and

travel expenses of such employees, but not including pay for regular

time of such employees.

(c) REVIEW.—The President shall review the management cost

rates established under subsection (a) not later than 3 years after

the date of establishment of such rates and periodically thereafter.

* * * * * * *

TITLE IV—MAJOR DISASTER

ASSISTANCE PROGRAMS

* * * * * * *

SEC. 404. HAZARD MITIGATION.

(a) IN GENERAL.—The President may contribute up to 75 percent

of the cost of hazard mitigation measures which the President has

determined are cost-effective and which substantially reduce the

risk of future damage, hardship, loss, or suffering in any area affected by a major disaster. Such measures shall be identified following the evaluation of natural hazards under section 409 and

shall be subject to approval by the President. The total of contribu-
27

tions under this section for a major disaster shall not exceed ø15

percent¿ 20 percent of the estimated aggregate amount of grants to

be made (less any associated administrative costs) under this Act

with respect to the major disaster.

* * * * * * *

SEC. 406. REPAIR, RESTORATION, AND REPLACEMENT OF DAMAGED

FACILITIES.

ø(a) CONTRIBUTIONS.—The President may make contributions—

ø(1) to a State or local government for the repair, restoration, reconstruction, or replacement of a public facility which

is damaged or destroyed by a major disaster and for associated

expenses incurred by such government; and

ø(2) to a person who owns or operates a private nonprofit facility damaged or destroyed by a major disaster for the repair,

restoration, reconstruction, or replacement of such facility and

for associated expenses incurred by such person.

ø(b) MINIMUM FEDERAL SHARE.—The Federal share of assistance

under this section shall be not less than—

ø(1) 75 percent of the net eligible cost of repair, restoration,

reconstruction, or replacement carried out under this section;

ø(2) 100 percent of associated expenses described in subsections (f)(1) and (f)(2); and

ø(3) 75 percent of associated expenses described in subsections (f)(3), (f)(4), and (f)(5).

ø(c) LARGE IN LIEU CONTRIBUTIONS.— ø(1) FOR PUBLIC FACILITIES.—In any case where a State or

local government determines that the public welfare would not

be best served by repairing, restoring, reconstructing, or replacing any public facility owned or controlled by such State or

local government, it may elect to receive, in lieu of a contribution under subsection (a)(1), a contribution of not to exceed 90

percent of the Federal share of the Federal estimate of the cost

of repairing, restoring, reconstructing, or replacing such facility

and of associated expenses. Funds contributed under this subsection may be used to repair, restore, or expand other selected

public facilities, to construct new facilities, or to fund hazard

mitigation measures which the State or local government determines to be necessary to meet a need for governmental services and functions in the area affected by the major disaster.

ø(2) FOR PRIVATE NONPROFIT FACILITIES.—In any case where

a person who owns or operates a private nonprofit facility determines that the public welfare would not be best served by

repairing, restoring, reconstructing, or replacing such facility,

such person may elect to receive, in lieu of a contribution

under subsection (a)(2), a contribution of not to exceed 90 percent of the Federal share of the Federal estimate of the cost

of repairing, restoring, reconstructing, or replacing such facility

and of associated expenses. Funds contributed under this subsection may be used to repair, restore, or expand other selected

private nonprofit facilities owned or operated by such person,

to construct new private nonprofit facilities to be owned or operated by such person, or to fund hazard mitigation measures

which such person determines to be necessary to meet a need
28

for its services and functions in the area affected by the major

disaster.

ø(3) RESTRICTION ON USE FOR STATE OR LOCAL CONTRIBU- TION.—Funds provided under this subsection shall not be used

for any State or local government cost-sharing contribution required under this Act.¿

(a) CONTRIBUTIONS.— (1) IN GENERAL.—The President may make contributions—

(A) to a State or local government for the repair, restoration, reconstruction, or replacement of a public facility

which is damaged or destroyed by a major disaster and for

associated expenses incurred by such government; and

(B) subject to paragraph (2), to a person who owns or operates a private nonprofit facility damaged or destroyed by

a major disaster for the repair, restoration, reconstruction,

or replacement of such facility and for associated expenses

incurred by such person.

(2) CONDITIONS FOR ASSISTANCE TO PRIVATE NONPROFIT FA- CILITIES.—

(A) IN GENERAL.—The President may make contributions

to a private nonprofit facility under paragraph (1)(B) only

if—

(i) the facility provides critical services (as defined by

the President) in the event of a major disaster; or

(ii)(I) the owner or operator of the facility has applied for a disaster loan under section 7(b) of the Small

Business Act (15 U.S.C. 636(b)); and

(II) has been determined to be ineligible for such a

loan; or

(III) has obtained such a loan in the maximum

amount for which the Small Business Administration

determines the facility is eligible.

(B) CRITICAL SERVICES DEFINED.—In this paragraph, the

term ‘‘critical services’’ includes, but is not limited to,

power, water, sewer, wastewater treatment, communications, and emergency medical care.

(b) MINIMUM FEDERAL SHARE.—The Federal share of assistance

under this section shall be not less than 75 percent of the eligible

cost of repair, restoration, reconstruction, or replacement carried out

under this section.

(c) LARGE IN-LIEU CONTRIBUTIONS.—

(1) FOR PUBLIC FACILITIES.—

(A) IN GENERAL.—In any case in which a State or local

government determines that the public welfare would not be

best served by repairing, restoring, reconstructing, or replacing any public facility owned or controlled by such

State or local government, the State or local government

may elect to receive, in lieu of a contribution under subsection (a)(1)(A), a contribution of 75 percent of the Federal

share of the Federal estimate of the cost of repairing, restoring, reconstructing, or replacing such facility and of management expenses.

(B) USE OF FUNDS.—Funds contributed to a State or

local government under this paragraph may be used to re-
29

pair, restore, or expand other selected public facilities, to

construct new facilities, or to fund hazard mitigation measures which the State or local government determines to be

necessary to meet a need for governmental services and

functions in the area affected by the major disaster.

(2) FOR PRIVATE NONPROFIT FACILITIES.— (A) IN GENERAL.—In any case where a person who owns

or operates a private nonprofit facility determines that the

public welfare would not be best served by repairing, restoring, reconstructing, or replacing such facility, such person

may elect to receive, in lieu of a contribution under subsection (a)(1)(B), a contribution of 75 percent of the Federal

share of the Federal estimate of the cost of repairing, restoring, reconstructing, or replacing such facility and of management expenses.

(B) USE OF FUNDS.—Funds contributed to a person under

this paragraph may be used to repair, restore, or expand

other selected private nonprofit facilities owned or operated

by the person, to construct new private nonprofit facilities

to be owned or operated by the person, or to fund hazard

mitigation measures that the person determines to be necessary to meet a need for its services and functions in the

area affected by the major disaster.

(3) MODIFICATION OF FEDERAL SHARE.—The President shall

modify the Federal share of the cost estimate provided in paragraphs (1) and (2) if the President determines an alternative

cost share will likely reduce the total amount of Federal assistance provided under this section. The Federal cost share for

purposes of paragraphs (1) and (2) shall not exceed 90 percent

and shall not be less than 50 percent.

* * * * * * *

ø(e) NET ELIGIBLE COST.— ø(1) GENERAL RULE.—For purposes of this section, the cost of

repairing, restoring, reconstructing, or replacing a public facility or private nonprofit facility on the basis of the design of

such facility as it existed immediately prior to the major disaster and in conformity with current applicable codes, specifications, and standards (including floodplain management and

hazard mitigation criteria required by the President or by the

Coastal Barrier Resources Act (16 U.S.C. 3501 et seq.)) shall,

at a minimum, be treated as the net eligible cost of such repair, restoration, reconstruction, or replacement.

ø(2) SPECIAL RULE.—In any case in which the facility being

repaired, restored, reconstructed, or replaced under this section

was under construction on the date of the major disaster, the

cost of repairing, restoring, reconstructing, or replacing such

facility shall include, for purposes of this section, only those

costs which, under the contract for such construction, are the

owner’s responsibility and not the contractor’s responsibility.

ø(f) ASSOCIATED EXPENSES.—For purposes of this section, associated expenses include the following:

ø(1) NECESSARY COSTS.—Necessary costs of requesting, obtaining, and administering Federal assistance based on a percentage of assistance provided as follows:
30

ø(A) For an applicant whose net eligible costs equal less

than $100,000, 3 percent of such net eligible costs.

ø(B) For an applicant whose net eligible costs equal

$100,000 or more but less than $1,000,000, $3,000 plus 2

percent of such net eligible costs in excess of $100,000.

ø(C) For an applicant whose net eligible costs equal

$1,000,000 or more but less than $5,000,000, $21,000 plus

1 percent of such net eligible costs in excess of $1,000,000.

ø(D) For an applicant whose net eligible costs equal

$5,000,000 or more, $61,000 plus 1⁄2 percent of such net eligible costs in excess of $5,000,000.

ø(2) EXTRAORDINARY COSTS.—Extraordinary costs incurred

by a State for preparation of damage survey reports, final inspection reports, project applications, final audits, and related

field inspections by State employees, including overtime pay

and per diem and travel expenses of such employees, but not

including pay for regular time of such employees, based on the

total amount of assistance provided under sections 403, 404,

406, 407, 502, and 503 in such State in connection with the

major disaster as follows:

ø(A) If such total amount is less than $100,000, 3 percent of such total amount.

ø(B) If such total amount is $100,000 or more but less

than $1,000,000, $3,000 plus 2 percent of such total

amount in excess of $100,000.

ø(C) If such total amount is $1,000,000 or more but less

than $5,000,000, $21,000 plus 1 percent of such total

amount in excess of $1,000,000.

ø(D) If such total amount is $5,000,000 or more, $61,000

plus 1⁄2 percent of such total amount in excess of

$5,000,000.

ø(3) COSTS OF NATIONAL GUARD.—The costs of mobilizing and

employing the National Guard for performance of eligible work.

ø(4) COSTS OF PRISON LABOR.—The costs of using prison

labor to perform eligible work, including wages actually paid,

transportation to a worksite, and extraordinary costs of guards,

food, and lodging.

ø(5) OTHER LABOR COSTS.—Base and overtime wages for an

applicant’s employees and extra hires performing eligible work

plus fringe benefits on such wages to the extent that such benefits were being paid before the disaster.¿

(e) ELIGIBLE COST.—

(1) IN GENERAL.—For the purposes of this section, the estimate of the cost of repairing, restoring, reconstructing, or replacing a public facility or private nonprofit facility on the

basis of the design of such facility as it existed immediately before the major disaster and in conformity with current applicable codes, specifications, and standards (including floodplain

management and hazard mitigation criteria required by the

President or by the Coastal Barrier Resources Act (16 U.S.C.

3501 et seq.)) shall be treated as the eligible cost of such repair,

restoration, reconstruction, or replacement. Subject to paragraph (2), the President shall use the cost estimation procedures
31

developed under paragraph (3) to make the estimate under this

paragraph.

(2) MODIFICATION OF ELIGIBLE COST.—In the event the actual

cost of repairing, restoring, reconstructing, or replacing a facility under this section is more than 120 percent or less than 80

percent of the cost estimated under paragraph (1), the President

may determine that the eligible cost be the actual cost of such

repair, restoration, reconstruction, or replacement. The government or person receiving assistance under this section shall reimburse the President for the portion of such assistance that exceeds the eligible cost of such repair, restoration, reconstruction,

or replacement.

(3) USE OF SURPLUS FUNDS.—In the event the actual cost of

repairing, restoring, reconstructing, or replacing a facility

under this section is less than 100 percent but not less than 80

percent of the cost estimated under paragraph (1), the government or person receiving assistance under this section shall use

any surplus funds to perform activities that are cost-effective

and reduce the risk of future damage, hardship, or suffering

from a major disaster.

(4) EXPERT PANEL.—Not later than 18 months after the date

of enactment of the Disaster Mitigation and Cost Reduction Act

of 1999, the President, acting through the Director of the Federal Emergency Management Agency, shall establish an expert

panel, including representatives from the construction industry,

to develop procedures for estimating the cost of repairing, restoring, reconstructing, or replacing a facility consistent with

industry practices.

(5) SPECIAL RULE.—In any case in which the facility being repaired, restored, reconstructed, or replaced under this section

was under construction on the date of the major disaster, the

cost of repairing, restoring, reconstructing, or replacing such facility shall include, for purposes of this section, only those costs

which, under the contract for such construction, are the owner’s

responsibility and not the contractor’s responsibility.

(6) OTHER ELIGIBLE COSTS.—For purposes of this section,

other eligible costs include the following:

(A) COSTS OF NATIONAL GUARD.—The cost of mobilizing

and employing the National Guard for performance of eligible work.

(B) COSTS OF PRISON LABOR.—The costs of using prison

labor to perform eligible work, including wages actually

paid, transportation to a worksite, and extraordinary costs

of guards, food, and lodging.

(C) OTHER LABOR COSTS.—Base and overtime wages for

an applicant’s employees and extra hires performing eligible work plus fringe benefits on such wages to the extent

that such benefits were being paid before the disaster.

* * * * * * *

øSEC. 408. TEMPORARY HOUSING ASSISTANCE.

ø(a) PROVISION OF TEMPORARY HOUSING.—

ø(1) IN GENERAL.—The President may—
32

ø(A) provide, by purchase or lease, temporary housing

(including unoccupied habitable dwellings), suitable rental

housing, mobile homes, or other readily fabricated dwellings to persons who, as a result of a major disaster, require temporary housing; and

ø(B) reimburse State and local governments in accordance with paragraph (4) for the cost of sites provided

under paragraph (2).

ø(2) MOBILE HOME SITE.—

ø(A) IN GENERAL.—Any mobile home or other readily

fabricated dwelling provided under this section shall whenever possible be located on a site which—

ø(i) is provided by the State or local government;

and

ø(ii) has utilities provided by the State or local government, by the owner of the site, or by the occupant

who was displaced by the major disaster.

ø(B) OTHER SITES.—Mobile homes and other readily fabricated dwellings may be located on sites provided by the

President if the President determines that such sites

would be more economical or accessible than sites described in subparagraph (A).

ø(3) PERIOD.—Federal financial and operational assistance

under this section shall continue for not longer than 18 months

after the date of the major disaster declaration by the President, unless the President determines that due to extraordinary circumstances it would be in the public interest to extend such 18-month period.

ø(4) FEDERAL SHARE.—The Federal share of assistance under

this section shall be 100 percent; except that the Federal share

of assistance under this section for construction and site development costs (including installation of utilities) at a mobile

home group site shall be 75 percent of the eligible cost of such

assistance. The State or local government receiving assistance

under this section shall pay any cost which is not paid for from

the Federal share.

ø(b) TEMPORARY MORTGAGE AND RENTAL PAYMENTS.—The President is authorized to provide assistance on a temporary basis in

the form of mortgage or rental payments to or on behalf of individuals and families who, as a result of financial hardship caused by

a major disaster, have received written notice of dispossession or

eviction from a residence by reason of a foreclosure of any mortgage or lien, cancellation of any contract of sale, or termination of

any lease, entered into prior to such disaster. Such assistance shall

be provided for the duration of the period of financial hardship but

not to exceed 18 months.

ø(c) IN LIEU EXPENDITURES.—In lieu of providing other types of

temporary housing after a major disaster, the President is authorized to make expenditures for the purpose of repairing or restoring

to a habitable condition owner-occupied private residential structures made uninhabitable by a major disaster which are capable of

being restored quickly to a habitable condition.

ø(d) TRANSFER OF TEMPORARY HOUSING.—
33

ø(1) DIRECT SALE TO OCCUPANTS.—Notwithstanding any

other provision of law, any temporary housing acquired by purchase may be sold directly to individuals and families who are

occupants of temporary housing at prices that are fair and equitable, as determined by the President.

ø(2) TRANSFERS TO STATES, LOCAL GOVERNMENTS, AND VOL- UNTARY ORGANIZATIONS.—The President may sell or otherwise

make available temporary housing units directly to States,

other governmental entities, and voluntary organizations. The

President shall impose as a condition of transfer under this

paragraph a covenant to comply with the provisions of section

308 requiring nondiscrimination in occupancy of such temporary housing units. Such disposition shall be limited to units

purchased under the provisions of subsection (a) and to the

purposes of providing temporary housing for disaster victims in

major disasters or emergencies.

ø(e) NOTIFICATION.— ø(1) IN GENERAL.—Each person who applies for assistance

under this section shall be notified regarding the type and

amount of any assistance for which such person qualifies.

Whenever practicable, such notice shall be provided within 7

days after the date of submission of such application.

ø(2) INFORMATION.—Notification under this subsection shall

provide information regarding—

ø(A) all forms of such assistance available;

ø(B) any specific criteria which must be met to qualify

for each type of assistance that is available;

ø(C) any limitations which apply to each type of assistance; and

ø(D) the address and telephone number of offices responsible for responding to—

ø(i) appeals of determinations of eligibility for assistance; and

ø(ii) requests for changes in the type or amount of

assistance provided.

ø(f) LOCATION.—In providing assistance under this section, consideration shall be given to the location of and travel time to—

ø(1) the applicant’s home and place of business;

ø(2) schools which the applicant or members of the applicant’s family who reside with the applicant attend; and

ø(3) crops or livestock which the applicant tends in the

course of any involvement in farming which provides 25 percent or more of the applicant’s annual income.¿

SEC. 408. FEDERAL ASSISTANCE TO INDIVIDUALS AND HOUSEHOLDS.

(a) GENERAL AUTHORITY.—Subject to the requirements of this section, the President, in consultation with the Governor of the affected

State, may provide financial assistance, and, if necessary, direct

services, to disaster victims who as a direct result of a major disaster have necessary expenses and serious needs where such victims

are unable to meet such expenses or needs through other means.

(b) HOUSING ASSISTANCE.—

(1) ELIGIBILITY.—The President may provide financial or

other assistance under this section to individuals and families

to respond to the disaster-related housing needs of those who
34

are displaced from their predisaster primary residences or

whose predisaster primary residences are rendered uninhabitable as a result of damage caused by a major disaster.

(2) DETERMINATION OF APPROPRIATE TYPES OF ASSISTANCE.—

The President shall determine appropriate types of housing assistance to be provided to disaster victims under this section

based upon considerations of cost effectiveness, convenience to

disaster victims, and such other factors as the President may

consider appropriate. One or more types of housing assistance

may be made available, based on the suitability and availability of the types of assistance, to meet the needs of disaster victims in the particular disaster situation.

(c) TYPES OF HOUSING ASSISTANCE.—

(1) TEMPORARY HOUSING.—

(A) FINANCIAL ASSISTANCE.—

(i) IN GENERAL.—The President may provide financial assistance under this section to individuals or

households to rent alternate housing accommodations,

existing rental units, manufactured housing, recreational vehicles, or other readily fabricated dwellings.

(ii) AMOUNT.—The amount of assistance under

clause (i) shall be based on the fair market rent for the

accommodation being furnished plus the cost of any

transportation, utility hookups, or unit installation not

being directly provided by the President.

(B) DIRECT ASSISTANCE.—

(i) IN GENERAL.—The President may also directly

provide under this section housing units, acquired by

purchase or lease, to individuals or households who,

because of a lack of available housing resources, would

be unable to make use of the assistance provided under

subparagraph (A).

(ii) PERIOD OF ASSISTANCE.—The President may not

provide direct assistance under clause (i) with respect

to a major disaster after the expiration of the 18-month

period beginning on the date of the declaration of the

major disaster by the President, except that the President may extend such period if the President determines that due to extraordinary circumstances an extension would be in the public interest.

(iii) COLLECTION OF RENTAL CHARGES.—After the expiration of the 18-month period referred to in clause

(ii), the President may charge fair market rent for the

accommodation being provided.

(2) REPAIRS.—The President may provide financial assistance

for the repair of owner-occupied private residences, utilities,

and residential infrastructure (such as private access routes)

damaged by a major disaster to a habitable or functioning condition. A recipient of assistance provided under this paragraph

need not show that the assistance can be met through other

means, except insurance proceeds, if the assistance is used for

emergency repairs to make a private residence habitable and
35

does not exceed $5,000 (based on fiscal year 1998 constant dollars).

(3) REPLACEMENT.—The President may provide financial assistance for the replacement of owner-occupied private residences damaged by a major disaster. Assistance provided under

this paragraph shall not exceed $10,000 (based on fiscal year

1998 constant dollars). The President may not waive any provision of Federal law requiring the purchase of flood insurance

as a condition for the receipt of Federal disaster assistance with

respect to assistance provided under this paragraph.

(4) PERMANENT HOUSING CONSTRUCTION.—The President may

provide financial assistance or direct assistance under this section to individuals or households to construct permanent housing in insular areas outside the continental United States and

other remote locations in cases in which—

(A) no alternative housing resources are available; and

(B) the types of temporary housing assistance described

in paragraph (1) are unavailable, infeasible, or not cost effective.

(d) TERMS AND CONDITIONS RELATING TO HOUSING ASSIST- ANCE.—

(1) SITES.—Any readily fabricated dwelling provided under

this section shall, whenever possible, be located on a site complete with utilities, and shall be provided by the State or local

government, by the owner of the site, or by the occupant who

was displaced by the major disaster. Readily fabricated dwellings may be located on sites provided by the President if the

President determines that such sites would be more economical

or accessible.

(2) DISPOSAL OF UNITS.— (A) SALE TO OCCUPANTS.— (i) IN GENERAL.—Notwithstanding any other provision of law, a temporary housing unit purchased under

this section by the President for the purposes of housing disaster victims may be sold directly to the individual or household who is occupying the unit if the individual or household needs permanent housing.

(ii) SALES PRICE.—Sales of temporary housing units

under clause (i) shall be accomplished at prices that

are fair and equitable.

(iii) DEPOSIT OF PROCEEDS.—Notwithstanding any

other provision of law, the proceeds of a sale under

clause (i) shall be deposited into the appropriate Disaster Relief Fund account.

(iv) USE OF GSA SERVICES.—The President may use

the services of the General Services Administration to

accomplish a sale under clause (i).

(B) OTHER METHODS OF DISPOSAL.—

(i) SALE.—If not disposed of under subparagraph

(A), a temporary housing unit purchased by the President for the purposes of housing disaster victims may

be resold.

(ii) DISPOSAL TO GOVERNMENTS AND VOLUNTARY ORGANIZATIONS.—A temporary housing unit described in
36

clause (i) may also be sold, transferred, donated, or

otherwise made available directly to a State or other

governmental entity or to a voluntary organization for

the sole purpose of providing temporary housing to disaster victims in major disasters and emergencies if, as

a condition of such sale, transfer, or donation, the

State, other governmental agency, or voluntary organization agrees to comply with the nondiscrimination

provisions of section 308 and to obtain and maintain

hazard and flood insurance on the housing unit.

(e) FINANCIAL ASSISTANCE TO ADDRESS OTHER NEEDS.— (1) MEDICAL, DENTAL, AND FUNERAL EXPENSES.—The President, in consultation with the Governor of the affected State,

may provide financial assistance under this section to an individual or household adversely affected by a major disaster to

meet disaster-related medical, dental, and funeral expenses.

(2) PERSONAL PROPERTY, TRANSPORTATION, AND OTHER EX- PENSES.—The President, in consultation with the Governor of

the affected State, may provide financial assistance under this

section to an individual or household described in paragraph

(1) to address personal property, transportation, and other necessary expenses or serious needs resulting from the major disaster.

(f) STATE ROLE.—The President shall provide for the substantial

and ongoing involvement of the affected State in administering the

assistance under this section.

(g) MAXIMUM AMOUNT OF ASSISTANCE.—No individual or household shall receive financial assistance greater than $25,000 under

this section with respect to a single major disaster. Such limit shall

be adjusted annually to reflect changes in the Consumer Price Index

for all Urban Consumers published by the Department of Labor.

(h) ISSUANCE OF REGULATIONS.—The President shall issue rules

and regulations to carry out the program, including criteria, standards, and procedures for determining eligibility for assistance.

* * * * * * *

øSEC. 411. INDIVIDUAL AND FAMILY GRANT PROGRAMS.

ø(a) IN GENERAL.—The President is authorized to make a grant

to a State for the purpose of making grants to individuals or families adversely affected by a major disaster for meeting disaster-related necessary expenses or serious needs of such individuals or

families in those cases where such individuals or families are unable to meet such expenses or needs through assistance under

other provisions of this Act or through other means.

ø(b) COST SHARING.—

ø(1) FEDERAL SHARE.—The Federal share of a grant to an individual or a family under this section shall be equal to 75 percent of the actual cost incurred.

ø(2) STATE CONTRIBUTION.—The Federal share of a grant

under this section shall be paid only on condition that the remaining 25 percent of the cost is paid to an individual or family from funds made available by a State.

ø(c) REGULATIONS.—The President shall promulgate regulations

to carry out this section and such regulations shall include national
37

criteria, standards, and procedures for the determination of eligibility for grants and the administration of grants under this section.

ø(d) ADMINISTRATIVE EXPENSES.—A State may expend not to exceed 5 percent of any grant made by the President to it under subsection (a) for expenses of administering grants to individuals and

families under this section.

ø(e) ADMINISTRATION THROUGH GOVERNOR.—The Governor of a

State shall administer the grant program authorized by this section in the State.

ø(f) LIMIT ON GRANTS TO INDIVIDUAL.—No individual or family

shall receive grants under this section aggregating more than

$10,000 with respect to any single major disaster. Such $10,000

limit shall annually be adjusted to reflect changes in the Consumer

Price Index for All Urban Consumers published by the Department

of Labor.¿

* * * * * * *

øCOMMUNITY DISASTER LOANS

øSEC. 417. (a) The President is authorized to make loans to any

local government which may suffer a substantial loss of tax and

other revenues as a result of a major disaster, and has demonstrated a need for financial assistance in order to perform its

governmental functions. The amount of any such loan shall be

based on need, and shall not exceed 25 per centum of the annual

operating budget of that local government for the fiscal year in

which the major disaster occurs. Repayment of all or any part of

such loan to the extent that revenues of the local government during the three full fiscal year period following the major disaster are

insufficient to meet the operating budget of the local government,

including additional disaster-related expenses of a municipal operation character shall be cancelled.

ø(b) Any loans made under this section shall not reduce or otherwise affect any grants or other assistance under this Act.¿

* * * * * * *

FIRE SUPPRESSION GRANTS

SEC. 420. The President is authorized to provide assistance, including grants, equipment, supplies, and personnel, to any State

and local government for the suppression of any fire on publicly or

privately owned forest or grassland which threatens such destruction as would constitute a major disaster.

* * * * * * *

øSEC. 422. SIMPLIFIED PROCEDURE.

øIf the Federal estimate of the cost of—

ø(1) repairing, restoring, reconstructing, or replacing under

section 406 any damaged or destroyed public facility or private

nonprofit facility,

ø(2) emergency assistance under section 403 or 502, or

ø(3) debris removed under section 407,

is less than $35,000, the President (on application of the State or

local government or the owner or operator of the private nonprofit
38

facility) may make the contribution to such State or local government or owner or operator under section 403, 406, 407, or 502, as

the case may be, on the basis of such Federal estimate. Such

$35,000 amount shall be adjusted annually to reflect changes in

the Consumer Price Index for All Urban Consumers published by

the Department of Labor.¿

* * * * * * *

TITLE V—EMERGENCY ASSISTANCE

PROGRAMS

* * * * * * *

SEC. 502. FEDERAL EMERGENCY ASSISTANCE.

(a) * * *

* * * * * * *

(6) provide øtemporary housing¿ assistance in accordance

with section 408; and

* * * * * * *
(39)

ADDITIONAL VIEWS

Currently, the Robert T. Stafford Disaster Relief and Emergency

Assistance Act provides to owners and operators of private nonprofit facilities damaged or destroyed by a major disaster grant assistance for the repair, restoration, reconstruction, or replacement

of the facility, and for the associated expenses incurred by that person. The bill as ordered reported would require certain of these

owners and operators to first apply for Small Business Administration (SBA) loans before being eligible for grants. While I understand the cost-saving motivation behind this proposal, I am concerned that the selective application of this new burden could cause

certain of these owners and operators of essential facilities to be

unable to rebuild following a major disaster. The resulting loss to

the community may be totally unwarranted when compared to the

minimal savings to the federal disaster program.

By law, to be eligible for this federal assistance, a private nonprofit facility must provide essential services of a governmental nature to the general public. The very reason that these owners and

operators of these private nonprofit facilities are eligible for assistance is that thye have stepped into the shoes of the government to

provide a service which is deemed essential to the community.

Many of us on the former Public Works and Transportation Committee, working closely with the Reagan Administration, determined that these private noprofit owners and operators were deserving of federal disaster assistance precisely because of what

they do, not because of who or what they are. The bill as introduced would have required all owners and operators of private nonprofit facilities to apply to the Small Business

Administration for a loan prior to being eligible for grant assistance. However, the Committee has approved an amendment which

will create a two-tiered system where some essential services of a

governmental nature are now considered ‘‘critical’’ and, as grant eligible more worthy of rebuilding assistance than others. The owners and operators of facilities that provide ‘‘critical’’ services will be

eligible for immediate grant assistance, but owners and operators

of non-critical services will still have to exhaust their remedies

with SBA.

I supported the amendment because it relieved some nonprofits

of an undesirable burden. But, I believe there remains a question

of whether we should go further and relieve all nonprofits of this

burden. I would like to see this issue considered further before we

go to conference with the other body.

While I believe that it is important for facilities such as power,

water, wastewater, and the like to be restored to operation as soon

as possible, I am not sure why these are grant eligible essential

services, and others, such as those supporting custodial care for the

aged or disabled, homeless shelters, senior citizen and community
40

centers, rehabilitation facilities, shelter-workshops, museums, or libraries may not be.

The owners and operators in the ‘‘second tier’’ may also be the

least able to shoulder the financial burden of additional debt, even

at the favorable terms offered by SBA. In reviewing the types of

activities that the bill identifies as eligible for grants, these are the

types of activities which usually generate revenue—power, water,

sewer and medical care. In reviewing the types of services that will

have to apply for loans, these services generally do not generate

significant revneue. Unfortunately, the result may be that these

services are not replaced.

The government provides many services to many people—and not

all of them are supported by everyone. In certain instances, essential services of a governmental nature are provided by private nonprofit entities. The value to a community from the rebuilding of a

senior citizen center should not be dependent upon whether or not

it is publicly owned. Particularly in the devastating times following

a major disaster, I would hope that we are not about creating a hierarchy of haves and have-nots within the community.

JAMES L. OBERSTAR.

Æ