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50–356 2009

S. HRG. 110–930 

TWO YEARS AFTER THE STORM: HOUSING NEEDS 

IN THE GULF COAST 

HEARING 

BEFORE THE

COMMITTEE ON 

BANKING, HOUSING, AND URBAN AFFAIRS 

UNITED STATES SENATE 

ONE HUNDRED TENTH CONGRESS 

FIRST SESSION 

ON 

THE CURRENT HOUSING NEEDS IN THE GULF COAST, HOW LOCAL, 

STATE AND FEDERAL EFFORTS ARE ASSISTING IN MEETING THE 

MOST PRESSING HOUSING NEEDS, AND WHAT CAN BE DONE TO 

JUMP-START HOUSING DEVELOPMENT AND ASSIST PEOPLE DISPLACED AS A RESULT OF THE 2005 HURRICANES RETURN TO THEIR 

COMMUNITIES 

TUESDAY, SEPTEMBER 25, 2007 

Printed for the use of the Committee on Banking, Housing, and Urban Affairs 

( 

Available at: http://www.access.gpo.gov/congress/senate/senate05sh.html 

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(II) 

COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS 

CHRISTOPHER J. DODD, Connecticut, Chairman 

TIM JOHNSON, South Dakota 

JACK REED, Rhode Island 

CHARLES E. SCHUMER, New York 

EVAN BAYH, Indiana 

THOMAS R. CARPER, Delaware 

ROBERT MENENDEZ, New Jersey 

DANIEL K. AKAKA, Hawaii 

SHERROD BROWN, Ohio 

ROBERT P. CASEY, Pennsylvania 

JON TESTER, Montana 

RICHARD C. SHELBY, Alabama 

ROBERT F. BENNETT, Utah 

WAYNE ALLARD, Colorado 

MICHAEL B. ENZI, Wyoming 

CHUCK HAGEL, Nebraska 

JIM BUNNING, Kentucky 

MIKE CRAPO, Idaho 

JOHN E. SUNUNU, New Hampshire 

ELIZABETH DOLE, North Carolina 

MEL MARTINEZ, Florida 

SHAWN MAHER, Staff Director 

WILLIAM D. DUHNKE, Republican Staff Director and Counsel 

JOSEPH R. KOLINSKI, Chief Clerk and Computer Systems Administrator 

JIM CROWELL, Editor 

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C O N T E N T S 

TUESDAY, SEPTEMBER 25, 2007 

Page 

Opening statement of Senator Reed ...................................................................... 1 

Prepared statement .......................................................................................... 34 

Opening statements, comments, or prepared statements of: 

Senator Shelby .................................................................................................. 1 

Senator Menendez ............................................................................................ 3 

WITNESSES 

Mary L. Landrieu, U.S. Senator from the State of Louisiana ............................. 2 

Prepared statement .......................................................................................... 35 

Orlando J. Cabrera, Assistant Secretary for Public and Indian Housing, Department of Housing and Urban Development .................................................. 6 

Prepared statement .......................................................................................... 45 

James Perry, Executive Director, Greater New Orleans Fair Housing Action 

Center .................................................................................................................... 18 

Prepared statement .......................................................................................... 50 

Alan Brown, Vice President of Operations and Chief Operating Officer, 

United Methodist Senior Services of Mississippi, Inc. ...................................... 20 

Prepared statement .......................................................................................... 59 

James R. Kelly, Chief Executive Officer, Providence Community Housing 

and Catholic Charities ......................................................................................... 21 

Prepared statement .......................................................................................... 76 

Emelda Paul, President, Lafitte Resident Council ............................................... 23 

Prepared statement .......................................................................................... 79 

Amy Liu, Deputy Director of the Metropolitan Policy Program, The Brookings 

Institution ............................................................................................................. 24 

Prepared statement .......................................................................................... 81 

Edgar Bright, President, Standard Mortgage Corporation, on behalf of the 

Mortgage Bankers Association ............................................................................ 26 

Prepared statement .......................................................................................... 99 

ADDITIONAL MATERIAL SUPPLIED FOR THE RECORD

Prepared statement from Kalima Rose, Director, Louisiana Initiative, 

PolicyLink ............................................................................................................. 107 

Letter submitted to Senator Landrieu from Mark A. Studdert, General Deputy Assistant Secretary for Congressional and Intergovernmental Relations, 

Department of Housing and Urban Development ............................................. 126 

Letter submitted to Senator Landrieu and Alphonso Jackson, Secretary, Department of Housing and Urban Development, from Milton J. Bailey, President, Louisiana Housing Finance Agency .......................................................... 127 

Letter submitted to Alphonso Jackson, Secretary, Department of Housing 

and Urban Development, from Senator Landrieu ............................................. 129 

Letter submitted to Senator Landrieu and Chairman Dodd from C. Ray 

Nagin, Mayor of New Orleans, Louisiana .......................................................... 131 

Prepared statement from Judith A. Browne-Dianis, Esq., Co-Director, Advancement Project ................................................................................................ 133 

Prepared statement from Amnesty International USA ........................................ 144 

Prepared statement from the National Multi Housing Council and the National Apartment Association .............................................................................. 152 

Prepared statement from Zack Carter, Community Organizer, Alabama Arise 159 

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IV 

The Washington Post, ‘‘Return to New Orleans; Residents should go home 

to new and better public housing,’’ editorial dated April 30, 2007 .................. 181 

The New York Times, ‘‘In Divided New Orleans,’’ editorial dated May 15, 

2007 ....................................................................................................................... 181

The Washington Post, ‘‘Home Sweet Home; New Orleans public housing residents deserve better than what they had before Hurricane Katrina,’’ editorial dated August 27, 2007 ............................................................................... 182 

S. 1668, Gulf Coast Recovery Act of 2007, section-by-section ............................... 184 

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(1) 

TWO YEARS AFTER THE STORM: HOUSING 

NEEDS IN THE GULF COAST 

TUESDAY, SEPTEMBER 25, 2007 

U.S. SENATE, COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, Washington, DC. 

The Committee met at 9:34 a.m., in room SD–538, Dirksen Senate Office Building, Senator Jack Reed, presiding. 

OPENING STATEMENT OF SENATOR JACK REED 

Senator REED. I would like to call the hearing to order. I want 

to welcome everyone to this important hearing on housing needs in 

the Gulf Coast and extend my appreciation to all the witnesses who 

have taken time out of their busy schedules to come to Washington, 

D.C., to be before us today. 

I want to also recognize my colleague Senator Mary Landrieu 

who is testifying this morning and acknowledge her efforts to secure resources and assistance for her constituents and all the Gulf 

Coast residents. She has been a stalwart in this effort, and she continues to do that. Her dedication to rebuilding these areas devastated by Hurricanes Katrina, Rita, and Wilma are impressive, 

and I know she is here fighting every day to make sure that the 

people of Louisiana and the Gulf Coast have an ability to rebuild 

their communities. 

We are here this morning because, although 2 years have elapsed 

since these hurricanes, unfortunately there is still much to be done, 

and we want to focus on what we can do to accelerate the reconstruction and do it in a way that will benefit the people of the communities that were devastated by these storms. 

I have a much longer statement which I would like to include in 

the record, because I do think it is important to hear not only from 

my colleague, the Ranking Member, Senator Shelby, but particularly Senator Landrieu. I would also note that Congressman Bill 

Jefferson is here. Welcome, Congressman. Thank you. 

Senator Shelby. 

OPENING STATEMENT OF SENATOR RICHARD C. SHELBY 

Senator SHELBY. Thank you, Chairman Reed. 

It has been over 2 years since Hurricane Katrina made landfall, 

leaving behind a trail of unimaginable destruction and loss. Before 

we begin a discussion of the continuing needs of Katrina survivors, 

however, I would like to once again remember the nearly 2,000 individuals who lost their lives here. I believe that we can honor 

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their memory in part by ensuring that the Gulf area is rebuilt not 

as it was, but as it should be. 

In these last 2 years, Congress has appropriated over $100 billion to rebuild what Katrina destroyed. That is a significant 

amount of money. Clearly, the question is not a matter of funding 

in some instances but, rather, a question of why is it taking so long 

to get the funding to those who need it. 

I hope that today’s hearing will provide an opportunity to examine how well the post-Katrina rebuilding effort is being conducted. 

Is it being fairly done? Is it being officially done? Is it reaching 

those people who really need it? 

While much of the focus since Katrina has been on New Orleans, 

I think it is also important to remember that Katrina also caused 

significant damage in Mississippi, my State of Alabama, and also 

Florida. A great deal of the damage done in these States occurred 

in many rural areas and small towns, and we are concerned that 

some of these smaller areas lack the capacity to fully tap the funding that Congress has provided for their needs. They should not be 

overlooked, and they should not be forgotten. 

For instance, over a third of the homes damaged in Mobile County, Alabama, were located in the unincorporated, often rural areas 

of the county. Congress tasked HUD with overseeing the development and implementation of each State’s plan to address housing 

needs resulting from Katrina. I look forward here today to hearing 

how HUD is monitoring each State’s efforts to address the specific 

and at times unmet needs of these smaller and sometimes isolated 

communities, such as in my State of Alabama. 

I want to welcome all of today’s witnesses and thank them for 

their appearance at the hearing, and while leadership here in 

Washington is vital to the success of the Gulf Region, the most important leadership is always and will be at the local level. 

I want to thank and recognize those Alabamians who have traveled here today and who are in the audience for their continuing 

efforts to help bring back some semblance of building like it was 

and should be to southern Alabama. 

Thank you, Mr. Chairman. 

Senator REED. Thank you, Senator Shelby. 

I would now like to recognize Senator Landrieu, and your full 

statement will be made part of the record, as well as any of the 

other statements of the witnesses today and members of the panel. 

Senator Landrieu. 

STATEMENT OF MARY L. LANDRIEU, U.S. SENATOR FROM THE 

STATE OF LOUISIANA 

Senator LANDRIEU. Thank you, Mr. Chairman, and I will try to 

summarize my remarks in the time allotted to me, and I really appreciate the opportunity to testify this morning on behalf of a great 

effort that is underway not only in our State but, as Senator Shelby said, throughout the Gulf Coast. 

Senator REED. Could I ask you for a moment—I am the Acting 

Chairman, and it is really acting this morning. 

Senator Menendez, do you have a statement before we recognize 

Senator Landrieu? Forgive me, Senator Landrieu. 

Senator LANDRIEU. No, go ahead. Senator, go right ahead. 

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OPENING STATEMENT OF SENATOR ROBERT MENENDEZ 

Senator MENENDEZ. I will be brief, Mr. Chair. 

First of all, let me thank you and the Ranking Member for holding the hearing. I think it is incredibly important, and I just want 

to make some brief remarks on this. 

You know, here we are almost 2 years after the storm has hit 

discussing housing needs and the recovery effort along the Gulf 

Coast, so that even the nature of the hearing troubles me in some 

respects. Why 2 years later we are still discussing the type of needs 

that exist today somewhat is baffling to me. 

So my real question today that I look forward to hearing is: Why 

hasn’t the region recovered? What hasn’t been done? What needs 

to be done? And what is the most effective, efficient way to get it 

done? 

Recent data indicates that homelessness in New Orleans, for example, has almost doubled. Two years later, we should have been 

able to put a roof over almost everyone’s head. This summer, 

82,000 people were still in trailers despite findings that many trailers contained a toxic chemical. We always talk about safe housing 

in this Committee, and now we need to stand by that commitment. 

Currently, there are 7,300 public housing units in New Orleans, 

but less than 2,000 are being rented. And now, as I understand it— 

and I look forward to the Assistant Secretary’s testimony—HUD 

has plans to demolish public housing buildings and replace them 

with fewer units. So that means we have either empty or destroyed 

apartments. Why aren’t we using all of our available resources to 

provide affordable housing? 

Mr. Chairman, 1.3 million people were driven from their homes. 

Fellow Americans were forced to leave not only their hometowns, 

but often to cross State lines to find a place to stay. I know New 

Jersey became a second home to many traveling from the Gulf 

Coast, but I saw it in their eyes when I talked to them that they 

long to go home. The sum of the population in New Orleans was 

only 66 percent of its pre-Katrina levels. It seems to me we are just 

over halfway there, and that is not acceptable. 

And let me close, Mr. Chairman—and I ask for the rest of my 

statement to be included in the record—by saying I have to be honest with you, if I lived in Louisiana, I would want Senator 

Landrieu to be my Senator because she does not lose a moment. 

As a matter of fact, sometimes when I am trying to catch the train 

to a vote, I decide whether or not I want to step in the same compartment with her. 

[Laughter.] 

Senator MENENDEZ. Because undoubtedly she will use the time, 

as I am sure she feels passionately about, to advocate for the reconstruction of her State and the people who have been displaced. And 

she just does an amazing job of it, and I just wanted to recognize 

her service. 

Thank you, Mr. Chairman. 

Senator REED. Thank you, Senator Menendez, and, again, I am 

sorry for not recognizing you immediately. 

Senator Landrieu, please continue. 

Senator LANDRIEU. Well, I thank Senator Menendez for those remarks, and I thank him for his care and concern and for coming 

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down and visiting and all of you on the panel this morning for focusing your ongoing efforts to help us recover in New Orleans, in 

the region, and in the Gulf Coast. 

I will try to be brief, but let me also acknowledge Representative 

Maxine Waters, Congressman Bill Jefferson, Congressman Barney 

Frank, and Congressman Richard Baker, Republicans and Democrats who have put their shoulders to the wheel to try to push and 

got a bill out of the House. This is a companion bill, if you will, 

in the Senate. I think there are some provisions of this bill that 

are slightly stronger, but both bills are moving in the right direction to find a balanced approach to solving some of the great housing challenges that, Senator Menendez, you so aptly pointed out. 

No. 2, let me begin by saying the scope of this disaster has still 

not been fully grasped, I think, here in Washington. We lost 

275,000 housing units between just Mississippi and Louisiana 

alone. And, Senator Shelby, I am sorry that I cannot give off the 

top of my head those lost in Alabama, which was a thousand or so, 

and in Texas as well. But 275,000 housing units were destroyed between Mississippi and Louisiana. 

Habitat for Humanity, which is probably the most aggressive 

nonprofit, community-based, stepped-up rebuilding homes, has 

built less than a thousand homes in 2 years. We cannot do this 

with all of the great work even of Habitat for Humanity and the 

foundations and nonprofit organizations. The Government must 

take an extraordinary, strong, and bold effort to push housing and 

to create housing and to provide opportunity, and to do it with 

partners like faith-based organizations and nonprofits and the community. But it is going to take more, is what I am saying, than just 

volunteers coming down to rebuild homes. And in large measure, 

this bill helps to find the pathway forward. 

Just to recap Orleans’ situation—and this is just one parish in 

the Gulf Coast, one parish—there were 80,000 owner-occupied 

units, 100,000 rental units. Of the 100,000 rental units, 15,000 

were public housing, including Section 8 of about 5,000, and there 

were 20,000 vacant rental units in New Orleans the day before the 

storm hit. 

I am sorry I do not have those details for St. Bernard Parish, for 

Jefferson Parish, for the counties in Mississippi. But the overwhelming numbers are what I am trying to convey here. 

In response to the devastation of hundreds of thousands of homes 

and businesses, the Federal Government has done a couple of big 

things. One, we have sent to date $13 billion for levee construction, 

and we just passed a WERDA bill yesterday to try to shore up levees and flood protection. We have passed $15 billion in community 

development block grants to try to give help to homeowners, primarily, and infrastructure, which would make sense. And we have 

provided billions of dollars in GO Zones for the redevelopment of 

business and housing. 

But there is a piece that is missing, and this is the piece. This 

is the housing piece for public housing and for renters, for people 

who choose not to be homeowners or cannot be homeowners, for 

people who would like to find a market-based rent but cannot afford it because their income is too low or because they are disabled 

or because they are elderly or because they are very, very, very 

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sick. We have got to push forward a public housing bill, and this 

is the bill. It came out of the House. This is a companion bill in 

the Senate. There is some urgency about getting this bill passed. 

No. 2, in the devastation of these public housing units, some of 

them were not in very good shape. Some of them were very high 

crime areas, and some of the units were quite dilapidated. Some 

people wanted to say let’s just demolish them and start all over 

again. Other people said let’s just renovate them and basically get 

back to where we were. 

This bill is a middle-of-the-road approach. This says we are not 

going to demolish all of the housing units, but it also says we are 

not just going to throw a little bit of paint on the walls, put a few 

light bulbs in, and have people living in the same sort of squalid 

conditions that many of these housing units represented before the 

storm. And I cannot thank the Congressmen and Congresswoman 

Maxine Waters enough for trying to push forward a middle-road 

approach with Catholic Charities, with the faith-based organizations, with the tenant groups that will say we are going to have 

a phased redevelopment. We have to give people a right to return. 

We have to give people a right to make choices about whether they 

come back. But we want to make it a better place. We want to not 

only build housing and build units, but have some mixed-income 

units. We want to provide wrap-around services. We want to provide, instead of just an apartment, perhaps daycare, perhaps help 

for senior citizens. 

That is basically, Mr. Chairman, what this bill does. I can answer a lot of questions about it, but I am hoping that HUD will 

testify to this this morning. There was a notice that came out Friday that has me a little concerned. I am hoping they can clarify 

it. But I am hoping, because we have considered HUD a partner 

in this, that they are committed to this middle-of-the-road redevelopment approach to try to provide urgent help for renters. Again, 

80,000 homeowners in New Orleans, but 100,000 renters. And 

while the community development block grant has gone to the 

Road Home Program trying to help homeowners get back—and we 

have still got a lot of challenges and work there, Senator Menendez—we have got to push forward a bill that expands Section 8, 

that gives some help to redevelopment of these rental units in a 

way that helps us rebuild a better city and better region. 

I am happy to include help for Mississippi. I am happy to include 

help for Alabama. The Senator can direct us, the Ranking Member, 

about how he would like us to help Alabama. This is not meant to 

be just a Louisiana bill, nor just a New Orleans bill. But I ask this 

Committee to work with us to help us get literally tens of thousands of people back. They were not homeowners. We hope to encourage homeownership. But as we work toward greater homeownership in Orleans Parish and other places, we need to find places— 

affordable, decent—where people can rent and live and get out of 

the trailers, particularly those with formaldehyde in the trailers. 

I am happy to answer any questions, but I think that that would 

suffice. I am going to stay here to listen to the panel. And, again, 

I thank my colleagues from the House for their great advocacy, and 

let’s try to push this bill through, get to a markup, Mr. Acting 

Chairman, and thank you very much. 

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Senator REED. Senator Shelby. 

Senator SHELBY. Senator Landrieu, we have talked about this on 

many occasions, and I know that Louisiana and Mississippi took 

the brunt of the damage here. But in my State of Alabama, and 

Mobile County, as I mentioned in my opening statement, we have 

got some rural areas that have more than been overlooked here. Of 

course, I will address that to the HUD Secretary in a few minutes. 

In any supplemental bill, the one you are advocating and others 

that we passed, I hope that you would be able to sit down with me 

and Senator Sessions and tailor our needs, which are small compared to yours but are very important to a population of our constituents in Mobile County, Alabama—— 

Senator LANDRIEU. Absolutely, and I will give you my full commitment. As you know, we have worked well together on revenue 

sharing for Louisiana and Alabama on coastal issues, and I look 

forward to it. The needs are, you know, different but they are 

equally important, and I am happy to include anything for Alabama and Mississippi in this bill. 

Senator SHELBY. Thank you. 

Thank you, Mr. Chairman. 

Senator REED. Thank you, Senator Shelby. 

Senator Landrieu, I would invite you to join the panel at the 

dais, and we would also like to welcome Orlando Cabrera, the Assistant Secretary for Public and Indian Housing at HUD. Mr. Secretary, thank you for joining us today, and we look forward to your 

testimony. 

STATEMENT OF ORLANDO J. CABRERA, ASSISTANT SECRETARY FOR PUBLIC AND INDIAN HOUSING, DEPARTMENT 

OF HOUSING AND URBAN DEVELOPMENT 

Mr. CABRERA. Thank you. Good morning, Mr. Chairman, Ranking Member Shelby, and Members of the Committee. Thank you for 

inviting us to testify before you today. 

Mr. Chairman, I ask that my statement be accepted for the 

record. 

Senator REED. Without objection. 

Mr. CABRERA. In my previous role as Executive Director of Florida Housing, we dealt with recovery efforts after having been 

struck by five hurricanes in a 13-month period. Despite that experience, Katrina has taught me that when it comes to the ferociousness of hurricanes, frequency pales in comparison to intensity. 

My personal experience with hurricane recovery extends well beyond my time with Florida Housing or Katrina, Rita, and Wilma. 

My wife and I were displaced from our home by Hurricane Andrew 

for 4 months. Our house was severely damaged. Comparatively, 

though, I feel fortunate today. Compared to those in New Orleans 

particularly, I was displaced by living with family in my own city, 

which, however dysfunctional the place at the time, still essentially 

found ways to provide its residents with basic services that New 

Orleans, for example, largely through no fault of its own, cannot 

provide. Our school system was still largely intact. Water and 

sewer infrastructure mostly worked. Public safety was in place, and 

medical services were available. Dade County still had a rough 

foundation upon which to rebuild. Even with that rudimentary 

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foundation, our community was in tatters and did not resemble 

itself for years afterward. 

In New Orleans, as an example, that foundation is considerably 

more washed away than it was in Dade County. Hurricane Andrew 

caused what at the time I considered to be unfathomable damage, 

but the aftermath was not such that our city was flooded for weeks 

and its population displaced, scattered about, two-thirds of it, overnight. 

In comparison, the experience of Katrina’s effect on Mississippi 

was more akin to Andrew than that of New Orleans. Now, 15 years 

after the beginning of those horrid days for our family, much of our 

efforts on the Gulf Coast are affected by those experiences of so 

long ago. 

Nothing, though, not even the previous years’ many hurricanes, 

could have prepared us for the hurricanes of 2005. HUD’s role in 

a catastrophe is always one that begins where emergency operations end and the efforts to return the community to some variation of normalcy begin. 

Congress has asked HUD to do a lot, and HUD has. Essentially, 

our task—and I mean the collective sense of ‘‘our’’—is to rebuild a 

geographical area roughly the size of Denmark and simultaneously 

rebuild a core city of the country roughly the size of Copenhagen. 

But the challenges are different in Mississippi than they are in 

Louisiana, and for different reasons. In Mississippi, Katrina was a 

hurricane, while in New Orleans it was something more than a 

hurricane—a hurricane followed by inundation. That kind of catastrophe can only be addressed by time. For those most affected, understandably time moves too slowly. For those of us committed to 

rebuilding, our sense is that time moves altogether too fast. But 

the tangible results are deliberate and slow. 

Given that premise, the core truth about recovery remains unchanged. Recovery is remarkably hard, thankless work for whoever 

undertakes it. To a degree, it should be thankless. Communities 

should rightly expect and receive help from all quarters—Federal, 

State, and local governments. HUD has certainly attempted to do 

its part in meeting those expectations during these last 2 years, 

and the one thing we all learned is that recovery never happens 

quickly enough. 

We have a lot to report regarding the last 2 years during which 

we have facilitated the availability of billions of dollars to the Gulf 

Coast States, made housing available to tens of thousands of Gulf 

Coast residents, created tools that help Americans affected by natural disasters find housing, and housed tens of thousands of public 

housing residents, Section 8 voucher holders, and other tenants 

whose housing is funded, directly or indirectly, by Federal dollars 

that HUD administers. 

Secretary Jackson has executed 120 regulatory waivers. It has 

made it easier for those that operate HUD programs to perform 

their jobs and more seamlessly provide housing. So what will that 

mean? 

For the Housing Authority of New Orleans, for example—it is 

known as HANO—it has meant bringing home over half of the 

city’s public housing residents. It will also mean 5,100 new affordable units, 1,000 new affordable homes ready for homeownership, 

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and 3,000 more tenant-based voucher holders available to residents 

of New Orleans. For coastal Mississippi and Alabama, it has meant 

helping PHAs rebuild damaged housing, which, to their fullest ability, they have done. In both cases, it meant assuring those who 

lived in public housing that they will have a first opportunity to 

return to housing that is provided by their respective public housing authorities. 

We have reached out to former public housing tenants all over 

the country consistently over the last 2 years, offered to pay off remaining lease payments if they elected to go home, offered to pay 

for moving expenses, and help resituate them in New Orleans by 

providing social services, a social net. 

Beyond public housing, it has come to mean helping thousands 

of storm victims by providing resources that have helped them find 

and maintain homes. It has meant providing the States that have 

received funds from Congress with the flexibility to shape their 

own recovery plans and perform. 

Similarly, it has meant that recovery and facilitating recovery is 

a predominant focus above anything else. HUD’s role has been and 

will continue to be to facilitate success and even catalyze success 

wherever possible. Regardless of HUD’s actions and unquestionable 

commitment to help recovery, nothing that has been done or could 

be done would address the ultimate truth that those of us in Government dealing with recovery—whether Federal, State, or local— 

know. We know that those folks want to be home, want their lives 

back as they knew them, their schools and hospitals back, and, 

most of all, their communities back. 

HUD’s commitment has been to make that aspiration of return 

to normalcy as likely as possible by executing upon the President’s 

and Congress’ commitment to recovery. HUD will continue to perform its part in the recovery efforts. 

Thank you for this opportunity to address the Committee. I 

stand ready to answer any questions you may have. 

Senator REED. Thank you very much, Mr. Secretary, and let me 

begin by saying that just recently—it was alluded to by Senator 

Menendez—HUD announced the demolition of four public housing 

units in New Orleans. And I understand that one of those units, 

Lafitte, the plan is to replace all the public housing units with scattered-site, mixed-income developments. But do you intend on a onefor-one replacement with the other three units? 

Mr. CABRERA. I think the issue is, Is it going to be one-for-one 

replacement of public housing or one-for-one replacement of affordable housing? We are committed to one-for-one replacement of affordable housing. When we talk about public housing, what we are 

talking about is a particular nature of the financing of operations 

going forward. If the issue is to serve a particular demographic— 

and in this case, the demographic is basically zero to 60 percent of 

area median income, or zero to 30 percent of area median income— 

there are lots of tools to do that with. That includes Lafitte. That 

includes the three others. 

I will clarify, though. On Friday, what was issued was a permit. 

Nothing has been knocked down. It is the first step in the process 

that started 18 months ago. 

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Senator REED. On public housing, let me go back to the initial 

point, which is that affordability is often in the eye of the beholder 

and the wallet of the payer. For many public housing tenants, their 

income is 30 percent of the area median income or below that. So 

if you are talking about affordable housing which is within the 

grasp of people who are making 60 percent of median income, that 

might be way beyond the ability of a lot of public housing tenants. 

What are those people going to do? 

Mr. CABRERA. I think, first of all, when you are talking about the 

nature of the vehicle that is financing these units, when you have 

units that are financed under Section 42 of the Internal Revenue 

Code, if someone is holding a tenant-based voucher—they have tenant-based rental assistance—and they present it to a landlord, it 

has to be accepted. So they really will be subsidized. The issue is 

the nature of what is going to be subsidizing those units. That is 

the point of tenant-based rental assistance, is to give people access 

to that marketplace. 

Now, what is being built are 5,100 units. What I think we all— 

and I include HUD in ‘‘we.’’ What we all forget is, prior to the hurricane, there were, I think, 2,700 units off-line in New Orleans, 

mostly because of housing quality standard problems. And so the 

issue here becomes trying to replace units with the most tenable 

way to operate them. So that is how essentially—— 

Senator REED. Well, I just want to clarify my understanding. Are 

you telling me that if you are a public housing tenant now, the unit 

was destroyed, there is not another unit that is either public housing or—public housing available for you, that you have the right 

to a voucher which will allow you to go into any rental place in 

New Orleans and the Federal Government will pick up the tab if 

you go to the—— 

Mr. CABRERA. What we are saying is if you were a public housing 

resident the day before the storm and you want to come home— 

and let’s think theoretically and assume that all of these units are 

up and they are available—you will be given the first opportunity 

to return. You will have a voucher, and you can utilize it at those 

units, assuming you have complied with Federal law, yes. On top 

of which there are ACC units that are going to be reconstructed. 

Senator REED. Well, I am going to allow my colleagues to ask 

questions. I might reserve the right to ask an additional question 

to follow up. It seems to me that you have already admitted that 

you are not going to, in the other three units, provide one-for-one 

replacement of public housing units. But somehow everybody is 

going to have a place to reside after you finish. 

Mr. CABRERA. I think, Mr. Chairman, the reason that this is 

something of an issue is because we presume that public housing 

is the only form of affordable housing. Public housing authorities, 

as a general rule, have been property managers, not developers. 

Public housing authorities all over the country are beginning to 

change that because the assets are 70 years old. They have to 

change that. So at the end of the day, what you build back using 

the various subsidy pools that are out there, the idea would be to 

serve that same population using the various tools that are out 

there, not just one. And the reason is because of the obsolescence 

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of those properties. Those properties are challenged, to say the 

least. 

Senator REED. Senator Shelby. 

Senator SHELBY. Thank you. Thank you, Senator Reed. 

Mr. Secretary, the HUD oversight of State CDBG plans, that is 

my subject here. Congress tasked, as you well know, HUD with approving and overseeing the design and implementation of each 

State’s—including my State of Alabama’s—long-term housing recovery plan. I believe one reason for giving HUD this responsibility 

was to ensure that Federal resources went to those most in need. 

Do you agree with that? 

Mr. CABRERA. Oh, absolutely, Senator. 

Senator SHELBY. OK. Could you share with the Committee here 

today, and what you do not have before you today, would you share 

for the record with me and the Committee, what requirements 

HUD placed on State plans in terms of targeting funds to those 

families most impacted, whether they are in a small city, a large 

city, a rural area, or what? Did HUD, in other words, include in 

its discussions with State governments the need to specifically address the problems of, for example, unincorporated and rural areas, 

such as Mobile County, Alabama—which is a large county, but you 

have the city of Mobile, you have a number of other cities. You 

have the town of Bayou la Batre. But a lot of people in those areas 

that were heavily impacted have not been—their needs have not 

been addressed. I met with some of them this morning, and we are 

looking for fairness in the distribution of the program. Go ahead, 

sir. 

Mr. CABRERA. Senator, I am going to ask to be indulged, if the 

Chair would allow, to have someone from CPD speak more specifically to your issue. 

Senator SHELBY. That would be good. 

Mr. CABRERA. Before I do, though, I would like to distinguish a 

couple of things. 

The first one is Alabama received two different tranches of 

CDBG, one in 2004 and one in 2005. And in that sense, in the 2004 

tranche, Alabama and Florida were kindred spirits because we 

were in the same tranche, and my good friend Bob Strickland, who 

runs Alabama Housing, we had a lot of chats about what it is we 

would need from that. And the thing that I think defined both is 

providing the State with the necessary flexibility to define for itself 

what it needs, and that is articulated on the consolidated plan of 

the State. 

Now, that is where I will end my part of the answer only because 

I have no further knowledge. So I am going to ask Bob to come 

up—— 

Senator SHELBY. Have him come up. But you do have an interest 

in implementing and overseeing that these plans are carried out 

fairly, do you not? 

Mr. CABRERA. The plans submitted by the various States are essentially accepted pursuant to the parameter provided in the Act. 

Senator SHELBY. Absolutely. 

Mr. CABRERA. And, thereafter, I would say this: that in most 

cases and in most States, what you will see is that the entitlement 

areas are provided some particular latitude just because of size, 

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and the non-entitlement areas are treated differently, and mostly 

through State devices because they are smaller. And by that I am 

alluding to your issue that you raised, rightfully, the issue of capacity. 

Senator SHELBY. Also fairness. 

Mr. CABRERA. And fairness, but that, again, would be a determination of the States and its prerogative. So I respect the issue 

you raise, but I would like Bob to—Bob knows more than me. 

Senator SHELBY. Let him address it. 

Mr. DUNCAN. Hi, my name is Robert Duncan. I am Grant Coordinator for Gulf Coast Recovery for CPD. 

Senator SHELBY. And that includes my State of Alabama. 

Mr. DUNCAN. It sure does, and I have been to Bayou La Batre 

four times. 

Senator SHELBY. What about some other areas? 

Mr. DUNCAN. I have been all through—— 

Senator SHELBY. There are some unincorporated areas that have 

been impacted by this and whose needs have not been addressed. 

Mr. DUNCAN. I spent 3 hours with the county building inspector 

driving through Mobile County looking at every damaged structure. 

Senator SHELBY. OK. Go ahead. 

Mr. DUNCAN. A small point of clarification, and that is, HUD 

does not have disapproval authority of the plans submitted by the 

States. And our authority is limited to assuring that the broad requirements of the program are met, including overall benefit to 

low- and moderate-income people; and with the second supplemental that was passed, that 19 percent went for lower-income 

rental. 

The State of Alabama has received just under $100 million from the two supplementals: $20 million out of the first supplemental is 

for housing generally, and $4 million out of the second supplemental is for housing for renters. 

I know that the State has developed plans for Bayou La Batre 

and is doing housing projects in Bayou La Batre. 

Senator SHELBY. We know that, but what about the other areas 

around there that are unmet and obviously overlooked, according 

to some constituents I met with? 

Mr. DUNCAN. When we get the plans, the plans are not so specific as to identify each potential recipient of the benefits. We approve broad-brush proposals, and if there is no discrimination—location is not necessarily a basis for discrimination, and so we are 

not talking about that type of compliance responsibility. 

Senator SHELBY. But what I am talking about—— 

Mr. DUNCAN. The State has ultimate responsibility for how it decides to allocate money. 

Senator SHELBY. The State is running the program, the Governor’s office and other State agencies. 

Mr. DUNCAN. That is correct. 

Senator SHELBY. Now, how much money is left unexpended in 

this program for the State of Alabama right now? 

Mr. DUNCAN. Right now the unexpended balance is about $86 

million. 

Senator SHELBY. $86 million. So they have some money in the 

States. Is this money that is obligated and unexpended, or is it—— 

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Mr. DUNCAN. It is obligated from HUD to the State but not—— 

Senator SHELBY. From the State to a specific—— 

Mr. DUNCAN. Identified for particular program areas, but not 

necessarily obligated or expended. 

Senator SHELBY. So the State will expend this $86 million you 

are talking about. 

Mr. DUNCAN. That is correct. 

Senator SHELBY. And so these unmet needs, the people—and 

some of them are in this room today—should, and we will help, get 

in touch with the State, who is administering this program, to try 

their best to make sure they are not overlooked and unfairly treated. Is that fair? 

Mr. DUNCAN. That is correct. The State has only spent $4 million out of the $20 million originally set aside for housing out of the 

first supplemental. They have spent none of the money for the 

renters. That does not mean that they have not proceeded with 

projects, but they have not expended the money. 

Senator SHELBY. OK. So you think there is money to be spent in 

an area that could be overlooked. 

Mr. DUNCAN. It appears that there is money available, but I am 

not in a position to say that I know the program is designed to provide grants to those individuals. 

Senator SHELBY. We will find out about that. 

Thank you, Mr. Chairman. 

Senator REED. Thank you very much. 

Senator Menendez. 

Senator MENENDEZ. Thank you, Mr. Chairman. 

Mr. Secretary, let me ask you a couple questions. First of all, this 

summer, 82,000 people were still in trailers—trailers that in many 

instances had formaldehyde, a toxic chemical. I saw in a HUD 

press release that beginning in January of next year, HUD is going 

to work with FEMA, supposedly, to transition eligible families out 

of these trailers and into rental housing in the private market. 

Two questions. One, what is that program going to look like? 

And, two, why wait until January when we have people languishing in trailers that they should not be in? 

Mr. CABRERA. The trailer issue overall is an issue outside of my 

bandwidth. That is a FEMA issue, so forgive my inability to answer that question. 

Senator MENENDEZ. But I have a HUD release here—— 

Mr. CABRERA. Senator, I am trying to go to the rest of it. 

Senator MENENDEZ. OK. 

Mr. CABRERA. Which is the transitioning of people in trailers out 

of trailers. So if you have broad categories of population, what 

HUD was doing with respect to both the KDHAP program, the 

Katrina Disaster Housing Assistance Program, and the Disaster 

Voucher Program was essentially serve those people who were 

being served by HUD as Congress denoted, so, just roughly speaking, public housing, Section 8, Section 202. So that has gone on for 

some time. 

Now, FEMA and HUD have entered into an interagency agreement. That happened within the last month, as I recall, and in that 

agreement, it has to dovetail with the Appropriations Act. The ability to convert from the Disaster Relief Fund into basically the Dissmartinez on DSKB9S0YB1PROD with HEARING

13 

aster Housing Assistance Program—which will be still funded by 

the Disaster Relief Fund but administered by HUD—will take time 

because there is an entire population of people who are being 

brought into the program who are not served by HUD and were not 

served by HUD prior to the hurricane. Those folks are largely in 

trailers, and those trailers, I think the mission would be to move 

them out of trailers and find them housing wherever they can. 

What are the tools we are using? Well, soon after the hurricane, 

one of the things that we did was we created something called the 

National Housing Locator, and the locator essentially is a broad 

data base that allows people to find housing wherever they can. 

The challenge will be, frankly, candidly, that in many cases—and 

this is mostly in Mississippi. In many cases, those trailers exist 

where people work and where they want to maintain their lives. 

But there is inadequate housing there, and that is really where our 

struggle is going—that is really where the rubber is going to hit 

the road for us. 

Senator MENENDEZ. Well, I have to be honest with you. I appreciate your answer, but if I was languishing in one of those trailers, 

having listened to your answer, it seems to me that our Government is failing those people, whether it is at the FEMA end or the 

ability to move earlier on the HUD end to wait for a process. We 

have had a lot of supplementals, appropriations, we have continuing resolutions coming up. It seems to me we should not have 

to wait for people to have whatever it is that you need to have the 

wherewithal to move them out. It is unacceptable that we have fellow Americans living in trailers that have toxic chemicals in them 

and that we find that acceptable as a country. It is unacceptable. 

Let me ask you this: We had 7,300 public housing units in New 

Orleans; 5,100 of them were occupied before the hurricane; less 

than 2,000 are now rented. Now, in addition to that, from my understanding of your testimony and from what HUD has put out 

there, there is not going to be—you are going to demolish four large 

public housing developments and rebuild them with mixed-income 

housing, eventually fewer public housing units. So I look at this, 

and I say to myself—and I also heard you—did you not say in your 

opening statement that HUD has reached out for displaced residents across the landscape of the country to say if you want to 

come back, we want to help you do that? 

Mr. CABRERA. Constantly. 

Senator MENENDEZ. Well, if I am a displaced resident in New 

Jersey—in Perth Amboy, New Jersey, where many of them ended 

up—and I want to go back to New Orleans, and I hear 82,000 are 

in trailers, I hear that only 2,000 of the 5,000 units that were existing before are rentable, I hear that HUD is going to demolish four 

of the major public housing projects and replace them with far less 

units, how do I think—I mean, these people are not stupid. How 

do they think that, in fact, you are going to be able to—that your 

offer is not hollow? Because at the end of the day, where do the 

units add up? 

Mr. CABRERA. Well, one reason that they would think that they 

are not hollow is because 400 of them are vacant as we sit here 

today, and we have been trying to get people into them. And they 

will not come home, and that if after going—— 

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Senator MENENDEZ. Then why are we waiting—— 

Mr. CABRERA. Senator, if I might finish—— 

Senator MENENDEZ. Then why are we waiting—I am happy to let 

you finish, but let me ask you—— 

Mr. CABRERA. After trying to pay for their social—— 

Senator MENENDEZ. Mr. Secretary? Mr. Secretary? 

Mr. CABRERA [continuing].—Relocating them, paying off their 

leases, they will not—— 

Senator MENENDEZ. Mr. Secretary, I get to ask the questions. 

You get to answer them. 

Mr. CABRERA. I am trying to answer. 

Senator MENENDEZ. OK, but let me just give you the follow-up 

question to it, because you took a long time in your first answer. 

Of the 82,000 people in trailers, you are going to tell me there is 

not a fair number of those who would qualify to put them in those 

units that you say right now—— 

Mr. CABRERA. The folks in trailers are folks who do not qualify 

for HUD assistance. That is what I was trying to—— 

Senator MENENDEZ. You have determined all of them do not 

qualify for HUD assistance? 

Mr. CABRERA. According to—— 

Senator MENENDEZ. If I would go to New Orleans and talk to 

those 82,000 people, I would find that none of them would qualify 

for your assistance? 

Mr. CABRERA. According to data that FEMA has, those people do 

not qualify for Federal assistance. That was the distinction between the two programs. 

What we have done at HUD is taken on a program that essentially is serving folks who HUD would typically not serve. That is 

who is in those trailers. Those are folks who were either above income or uninsured, or folks who were above income and insured 

but inadequately insured. There are any number of categories that 

fit from a demographic into those 82,000, but the one distinguishing characteristic is they do not qualify—— 

Senator MENENDEZ. How do you reconcile the rise of homelessness in New Orleans with your units being vacant in public housing? Explain that to me. 

Mr. CABRERA. Senator, I cannot. I do not—I cannot—— 

Senator MENENDEZ. Well, those people would qualify for public 

housing, would they not? 

Mr. CABRERA. Well, I think that the reason that I cannot do it 

is because I do not know enough about the issue of homelessness 

in New Orleans as I sit here today, post-storm, with everything 

going on. So I cannot answer the question honestly. 

Senator MENENDEZ. Well, it seems to me that we need Senator 

Landrieu’s legislation. 

Thank you, Mr. Chairman. 

Senator REED. Thank you, Senator Menendez. 

Senator Landrieu. 

Senator LANDRIEU. Thank you so much. 

I would like to focus again on the bill before us, the subject of 

this hearing. Mr. Secretary, do you all support this bill? And if so, 

why do you support it? And if not, why not, specifically? What sections are you not supporting? 

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Mr. CABRERA. Senator Landrieu, there are parts of the bill that 

we do support. There are parts of the bill that we absolutely do not. 

And the parts—— 

Senator LANDRIEU. OK. Could you please elaborate the parts 

that you do support? 

Mr. CABRERA. The issues that most cause angst have to do 

with—— 

Senator LANDRIEU. No. I am talking about what you do support. 

Mr. CABRERA. You know, I think I am going to do what I did before and allow Dominique Blom to come up and speak to that issue. 

But what we do support most generally is anything that would facilitate reconstruction of housing generally. 

Senator LANDRIEU. Because I am under the impression, given the 

testimony that Secretary Jackson has given to me—and I am extremely disappointed he could not be here to represent the Department this morning—that HUD is supporting the bill, that HUD 

supported the bill when it moved out of the House and that HUD 

is supporting this bill. So if you all are not, we would like to have 

a specific letter from you all about what you are not supporting. 

But, again, let’s hear the testimony. What do you support in the 

bill and specifically what you do not and why? 

Mr. CABRERA. Senator, may I have a moment very quickly? 

[Pause.] 

Senator, I am going to have a response to you on the official on 

support or non-support. I know that we do not support the bill. I 

am trying to get clarity in terms of our own facts. But the 

thing—— 

Senator LANDRIEU. But the reason this is disturbing to me—and 

I hope the panel can understand, and I am going to try to be patient. This gentleman is the Assistant Secretary of HUD. He is in 

charge of public housing. If he does not know why or why not he 

is supporting this bill, why he has to ask for staff, you can see how 

far we have to go. Now let me just—— 

Mr. CABRERA. No, Senator Landrieu. I am trying to figure 

out—— 

Senator LANDRIEU. Hold on. Let me just say one—— 

Mr. CABRERA [continuing].—If you have received the views letter. 

That is all I am trying to find out. 

Senator LANDRIEU. I am operating for a year and a half—a year 

and a half operating—with the Congressmen on both sides of the 

aisle. This is not just a Democratic bill. This came out of the House 

with broad bipartisan support, Republicans and Democrats, with 

the idea that HUD was supporting our efforts. Now to be told, A, 

you do not know or no is not—— 

Mr. CABRERA. No, Senator. I did not say I did not know. As I 

noted, I was trying to get you an answer with respect to whether 

we have articulated why we do not support the bill. If you will give 

me just a moment, the person who can answer that question for me 

is behind me. 

Senator LANDRIEU. Please. 

Mr. CABRERA. A views letter has been prepared that is supposed 

to have been issued. It will be issued, evidently, as I understand 

it, tomorrow. I can tell you preliminarily what it is that causes us 

consternation in the bill. 

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The first issue and the foremost issue is the issue of one-to-one 

replacement. One-to-one replacement of public housing is both—it 

seems to us to be contrary to what has been the legislative intent 

of public housing for a while, but it seems to us to limit the ability 

to build affordable housing in a way that—— 

Senator LANDRIEU. OK. I understand. I do not mean to interrupt 

you. But, Mr. Chairman, this is important. There is a one-to-one 

housing requirement for 5,000 units. But let me repeat the facts. 

There were 7,000 units before the storm, 2,000 were vacant, and 

there were 7,000 people on a waiting list. So the compromise for 

a one-to-one replacement of 5,000 we think is a generous compromise. 

Mr. CABRERA. There—— 

Senator LANDRIEU. First of all—let me finish. We are not asking 

for one-to-one compromise for 14,000 units, which you might argue 

5,000 were there, 2,000 were vacant, 7,000. So just add the 5,000 

and the 7,000 is 13,000. 

Mr. CABRERA. Right. 

Senator LANDRIEU. We could in this bill have a 13,000-unit requirement for one to one, but we are trying to find a middle road 

and get enough units back for people, because it is workforce housing as well. All low-income people are not disabled and unable to 

work. Many of them are working. Many. And our restaurants and 

businesses need people. 

So I am perplexed and I think that Congresswoman Waters and 

Congressman Baker and Congressman Jefferson will be very perplexed, after a year and a half, to think that you all are not supporting this bill. 

Let me just clarify—— 

Mr. CABRERA. Well, I am trying to—— 

Senator LANDRIEU. Hold on. One more—— 

Mr. CABRERA [continuing]. Tell you what I support—— 

Senator LANDRIEU. I just want to clarify one more thing. This letter that came out yesterday says that absent the disposition approval granted by HUD, these projects would not be able to meet 

the LHFA carryover requirement. I am going to put this in the 

record. And this is the reason that you are using for going ahead 

with the demolition—not permit, but the movement toward demolition. 

I want to say for the record, Mr. Chairman and Mr. Ranking 

Member, the LHFA wants me to say this, Louisiana Housing Finance Agency: They are not requiring you to move. You are moving 

on your own volition. And I am going to put this in the record. 

They disagree strongly with you saying that you are moving because of them. 

Number two, for the record, you say that you have to move forward because we do not have an extension of the tax credits, but 

you have not requested of this Committee, which is your authorizing Committee, you have not requested of your Appropriations 

Committee, which I sit on, any extension. 

So I just want to state for the record that no one in Louisiana 

is pushing you to do this, that you are doing it on your own, and 

I am actually shocked that after a year and a half you all are not 

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even supporting the compromise bill. And I have more questions, 

but I do not want to take up any more time. 

Thank you, Mr. Chairman. 

Mr. CABRERA. Mr. Chairman, may I answer? 

Senator REED. Yes, you may. 

Mr. CABRERA. OK. First of all, the elements of the bill that we 

support are: We support the idea of surveying the residents. We 

think that that is a terrific idea. 

We support the idea of replacing 5,100 units with affordable 

units. The issue is what is going to be the nature of trying to operate those units after they are constructed. 

We support the idea of 3,000 vouchers which would otherwise be 

issued. 

And the last issue is I think one of the things that is somewhat 

misunderstood is the process of HANO moving toward getting a 

demolition and disposition permit began 18 months ago. I can tell 

you just personally, I had no earthly clue that the court would 

render a decision last week. And, in fact, I was in Washington 

State when it happened. So that is something that happens as a 

matter of course. 

When we issued it—this is not an issue of an extension. There 

are issues that we could bring to this Committee for extension, but 

we cannot bring to this Committee issues of extension when we are 

trying to preserve into HANO’s baseline the capacity to issue another $30 million worth of vouchers going forward. That is really 

what we were trying to accomplish. 

So while I respect, Senator, that you have issues with the way 

that we have proceeded, the one thing you need to know is this— 

you know, I cannot help happenstance. This was going to be issued 

on Friday because it was going to be issued on Friday. 

Senator REED. Mr. Secretary, I can anticipate the written questions directed to you, and we hope you respond because I think the 

line of questioning has exposed more questions than answers, and 

we will continue this discussion. 

Senator Shelby. 

Senator SHELBY. I just want to continue to focus on my State of 

Alabama for just a minute. 

Mr. CABRERA. Yes, sir. 

Senator SHELBY. We all know that Louisiana has taken a tremendous hit. We know Mississippi has. And we have in the southern part of Mobile County taken a hit, as you well know. And my 

interest, parochial interest, is in Alabama, although I want to help 

where I can to rebuild what we can in a prudent manner—in a prudent manner—in New Orleans and the Louisiana area, too. But I 

hope we will not send money down the drain in Louisiana, Mississippi, Alabama, Florida, or anywhere, because I recognize your 

responsibility at HUD and I think you have an overall responsibility to the taxpayers, to the people. And we want to make sure 

that all this is done fairly. 

Mr. CABRERA. Thank you, Senator. 

Senator SHELBY. Thank you, Mr. Chairman. 

Senator REED. Well, I join the Ranking Member in his wish that 

we do things fairly, but it strikes me from listening—I am going 

to get more engrossed in the details—that the numbers just do not 

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seem to add up. The number of units you are proposing to replace 

are much less than the number of people that are out there, not 

just in public housing, but on waiting lists to get in public housing. 

And I appreciate your testimony, and we will continue the inquiry 

by written questions, Mr. Secretary. Thank you very much. 

Mr. CABRERA. Thank you, Senator. 

Senator REED. Now let me call forward the next panel. We thank 

them for traveling from Louisiana and Mississippi to be with us 

here today. We certainly appreciate their testimony. 

Senator LANDRIEU. Mr. Chairman, as they are assembling, can 

I just also thank them? I am going to stay as long as I can for the 

testimony, but each of these individuals has worked tirelessly representing many, many people and constituency groups, trying to 

help come to terms with how we would move in a positive direction 

to redevelop, to rebuild, to provide better housing for people, and 

to help, you know, our constituents. And I just want to thank them, 

and I hope maybe they can shed some light on the benefits of this 

bill and what it will do to help. 

Senator REED. Well, thank you very much, Senator Landrieu, 

and let me quickly introduce the panel and make a couple of administrative announcements and then ask them for their comments. 

We are joined this morning by Amy Liu, who is the Deputy Director of the Metropolitan Policy Program at the Brookings Institution. We are joined by James Kelly, who is the CEO of Providence 

Community Housing and Catholic Charities. We are also joined by 

James Perry, the Executive Director of the Greater New Orleans 

Fair Housing Action Center; Mr. Alan Brown, who is Vice President of Operations and COO of the United Methodist Senior Services of Mississippi; Emelda Paul, President of the Lafitte Resident 

Council; and Mr. Edgar Bright, who is President of the Standard 

Mortgage Corporation, representing the Mortgage Bankers Association. 

Before hearing your testimony, we have a number of written 

statements that have been submitted by others. I want to make 

sure they are part of the record. Your statements will all be made 

part of the record, so you do not have to read them. I want to urge 

the panelists to stay within the 4-minute boundary. We have a 

large panel, and we want to leave time for questions. 

Again, thank you very much for joining us. The record will remain open for at least one week, so you may get additional written 

questions from the panel or any Members of the Banking Committee. And now I will recognize you, Mr. Perry, for your comments. Mr. Perry, please. 

STATEMENT OF JAMES PERRY, EXECUTIVE DIRECTOR, 

GREATER NEW ORLEANS FAIR HOUSING ACTION CENTER 

Mr. PERRY. Thank you very much. 

Senator Reed, Ranking Member Shelby, and members of the 

Committee, thank you for the opportunity to testify on the impact 

of Senate Bill 1668. I am James Perry, Executive Director of the 

Greater New Orleans Fair Housing Action Center. I am also President of the Louisiana Housing Alliance, a Statewide coalition of 

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more than 100 housing organizations. I am here today to testify on 

behalf of the National Low Income Housing Coalition. 

My full testimony, of course, has been provided to you. But I 

want to touch upon a few facts and issues that provide why this 

bill is so important to the Gulf Coast States. The first is simply 

about public housing. We simply do not have enough affordable 

housing in New Orleans, in Mississippi, in Louisiana, and along 

the Gulf Coast. If left to its own devices, as you have seen from 

HUD’s testimony, they simply would not provide enough affordable 

housing for our residents. 

I want to touch briefly on the Assistant Secretary’s comment that 

FEMA trailer residents would not qualify for public housing. Well, 

our stats show that about 20 percent of FEMA trailer residents 

would qualify for public housing. And so when he says that he cannot find people, we think that he is, frankly, wrong. 

The second issue is that when it comes to public housing in New 

Orleans, as has already been noted by Senator Landrieu, we had 

a huge need for more public housing before the storm. And HUD 

comes forward after the storm and says we are going to demolish 

all of the public housing in spite of this. 

Well, we need more public housing now. 

The goal of replacing one-for-one of the public housing units that 

existed in the city before the storm is impeccable. It is so important. It is essential to make sure that the city is able to come back 

and to return to its prior status and to exceed that prior status 

that once existed. 

The second thing that I want to comment on are the fair housing 

provisions in the bill. We applaud the inclusion of these provisions 

in the bill. Since the storm, our organization has done a few investigations into housing discrimination in the metropolitan area. 

When we investigated housing discrimination against AfricanAmericans, we found that African-Americans experienced discrimination in 57.5 percent of their transactions. 57.5 percent of the 

time that they would attempt to find housing they would be denied 

because of their race. 

In one investigation we found discriminatory advertisements on 

the Internet. Two examples of those ads: ‘‘I would love to house a 

single mom with one child. I am not racist, but whites only.’’ Another ad read ‘‘Not to sound racist, but to make things more understandable for our younger children, we would like to house white 

children.’’ 

The issue of housing discrimination presents a huge problem 

when we attempt to rebuild housing opportunities for people in the 

Gulf Coast. The Greater New Orleans Fair Housing Action Center, 

the Mississippi Fair Housing Center, the Houston Fair Housing 

Center, and the Mobile Fair Housing Center have been on the front 

of ensuring fair and equitable housing opportunities in the Gulf 

Coast but we need your help and Senate Bill 1668 will provide that 

assistance. 

And then finally, with regard to the Road Home program, the 

program, of course, is not perfect. And there has been a lot of debate about whose fault or what has caused the shortfall in the 

amount of money necessary to get homeowners back into housing. 

But what I would submit to you is that it does not really matter 

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whose fault it is. The bottom line issue is that we need enough 

money to get homeowners back into their houses. 

Senate Bill 1668 goes a long way in making sure that people can 

get back into their houses through the Road Home program, 

through provision of one-for-one replacement in public housing, 

through the provision of vouchers, and through the protection of 

fair housing rights. 

We urge you to move forward on this bill. 

Thank you very much. 

Senator REED. Thank you very much, Mr. Perry. 

Mr. Brown, please. Welcome. 

STATEMENT OF ALAN BROWN, VICE PRESIDENT OF OPERATIONS AND COO, UNITED METHODIST SENIOR SERVICES 

OF MISSISSIPPI, INC. 

Mr. BROWN. Thank you, Senator Reed, Ranking Member Shelby, 

members of the Committee. I am Alan Brown, the Chief Operating 

Officer of Mississippi Methodist Senior Services. 

We have 11 campuses across the State of Mississippi, serving 

1,800 seniors on a daily basis. Our organization has been serving 

seniors for over 40 years and we were the first in the State of Mississippi to offer HUD housing for seniors. 

We are also a member of the American Association of Homes and 

Services for the Aging, a 5,700 member association representing 

not-for-profit providers throughout the world of senior care. 

On August 29th, 2005, five of our campuses were damaged by 

Hurricane Katrina, none more so than our Seashore Retirement 

Community in Biloxi. That campus consisted of 124 market rate 

apartments, 42 assisted living units, a 65-unit HUD 202 project 

with project-based Section 8 rent subsidies. 

Our HUD building, Gulf Oaks, sustained significant wind damage, as well as a tidal surge of two feet on the first floor. 55 residents refused to leave the campus and rode out the storm with the 

campus executive director, who would not leave them. We were 

able to evacuate them 2 days later and provide housing on other 

campuses in North Mississippi. 

We had good insurance, but there was still a $1 million gap between our insurance proceeds and what was needed to repair the 

building. We contacted HUD and asked for help. We were told 

HUD would not loan the property any more money for repairs. 

HUD would not allow us to borrow money from other sources. HUD 

would not forgive the existing debt. And HUD would not allow us 

to prepay the Section 202 mortgage. In a sense, we were stuck. 

Our FEMA request for help was denied because were deemed a 

nonessential service. We contacted AAHSA for help and learned of 

a provision in the 2006 appropriations legislation, Section 318, 

which allowed for the relocation of Section 8 contracts from nonviable damaged HUD buildings. We thought this was tailor-made 

for us. On March 31st, 2006 we notified the Mississippi HUD office 

that we would be requesting a Section 318 transfer and provided 

them the preliminary information. 

About this time, we received an unsolicited offer from a local developer to purchase the entire campus and accepted, contingent 

upon our being able to get a HUD release of the property. This 

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would allow us to have the funds to relocate the entire campus off 

the coast to a safer area and rebuild the HUD building at no additional cost to HUD. 

On July 5th, 2006 we submitted our formal Section 318 request 

and asked HUD about how to begin. Weeks passed and we got no 

response from HUD. Once we inquired and were told they were not 

sure whose desk it was on. Senator Thad Cochran’s staff and 

AAHSA intervened and made repeated inquiries to HUD on our behalf and were assured it was in process. 

On October 2nd, 2006, almost 3 months after the formal request, 

we received a letter from HUD saying our Section 318 had been denied. We were given a list of things that would have to be done for 

the request to be considered. These items had never been communicated to us before or were not economically feasible or could not 

be encompassed for many months. We were in jeopardy of losing 

the sale of the entire property and our business interruption coverage was exhausted. 

But we wanted to make one last effort to try to save the 65 subsidized housing units. We learned that we had a pre-1984 HUD 

202 contract that could actually be prepaid with 30 days’ notice 

and without HUD approval. We asked HUD for approval to transfer the Section 8 rent subsidies to a new building. They called us 

back the next day and said that could be done. As we got closer 

to the sale, we asked HUD about how we completed that process. 

They said they never agreed to that. 

HUD essentially forced us to give up our Section 8 contract to 

complete the sale of the campus. HUD had done what the hurricane had not able to do, permanently displace those residents that 

had ridden out the storm in their homes. 

We asked today for your support of Senate Bill 1668. There are 

several provisions within this legislation that would benefit seniors 

and the not-for-profit housing providers that serve them. Our residents and assisted housing providers will certainly fall victim to 

the same impenetrable barriers like confusing procedures, unclear 

goals, and ineffective policies when the next disaster strikes. 

In closing, I want you to know that Mississippi Methodist Senior 

Services remains committed to continuing our 40-year-old mission 

of serving older adults in the spirit of Christian love and providing 

housing to senior adults regardless of their financial standing. 

I sincerely appreciate the efforts of the Jackson, Mississippi HUD 

office and Senator Cochran’s staff. And I want to thank you for giving me the opportunity to be here today and share our story. 

Senator REED. Thank you very much, Mr. Brown. 

Mr. Kelly, please. 

STATEMENT OF JAMES R. KELLY, CEO, PROVIDENCE 

COMMUNITY HOUSING AND CATHOLIC CHARITIES 

Mr. KELLY. I would like to thank Senator Reed, Ranking Member 

Shelby, Senator Landrieu, the members of the Committee for the 

opportunity to be here today. 

In the past 24 months Catholic Charities has delivered 120 million pounds of food and water, provided counseling and information 

to half a million people, and through our emergency service censmartinez on DSKB9S0YB1PROD with HEARING

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ters, delivered millions of dollars in direct assistance to families in 

need. 

Shortly after the storm, a group of nonprofits came together to 

form Providence with the mission of bringing home 20,000 victims 

of Katrina. In partnership with Catholic Charities and 13,000 volunteers, we have gutted and cleaned out 1,100 homes and 800 

apartments. Now we are assisting these low-income seniors and 

people with disabilities to navigate a severely underfunded Road 

Home program. We often front the seniors the money for the essential and critical home repairs. 

Recently Providence and UJAMAA CDC, one of our community 

collaborators, finished renovating a flooded building and will soon 

welcome 43 displaced seniors back to their Treme community. 

Since the hurricane, we have been attempting to reopen 901 

HUD Section 202 apartments for low income seniors. Complications 

are 135 percent increase in construction, tripling in cost of insurance, and the requirement to finance the original owners’ defaulted 

mortgage payments which date back to March 2006. As we spend 

an inordinate amount of time and effort working through these archaic policies, thousands of our seniors wait in trailers or in overpriced and overcrowded apartments wondering if they will get to 

return to their children and their grandchildren. 

Last summer Providence and Enterprise Community Partners 

were asked by HUD to oversee the redevelopment of the Lafitte 

public housing complex. From the very beginning, we have worked 

closely with the residents to plan a vibrant mixed-income community that is equitable, affordable, and sustainable. The cornerstone 

of our rebuilding effort began with the absolute opportunity for the 

865 families to return as soon as possible, the one-for-one replacement of all 900 units, and critically needed resident participation 

in the home building and community service planning. In addition 

to the replacement of the 900 apartments, we will build 600 new 

homes for working families. 

We have also successfully advocated for phased redevelopment, 

the repair of temporary units for those who need to come home 

right now, while also along for the building of new homes and 

apartments on the remaining site. We have raised $2.5 million and 

are now offering former residents counseling, direct assistance, and 

case management in New Orleans, Baton Rouge, and Houston. 

We thank you for this sound legislation before us today. We are 

humbled that the principles that are the foundation of our Lafitte 

redevelopments plans are key components of the public housing 

section of the bill, most especially the replacement of public housing units and/or vouchers for residents. 

To ensure the success of these new vibrant mixed-income communities, we would ask you to increase the number of project-based 

onsite Section 8 vouchers and the funding for soft second home 

mortgages available to residents. 

With over 20,000 severely damaged homes and apartments, we 

are grateful that the legislation also assists our working and middle-class families. We are delighted that the bill addresses the need 

for full funding the Road Home program, provides 4,500 permanent 

and supportive housing vouchers for the disabled and the homeless, 

and extends disaster vouchers through June of 2008. 

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We expect the rebuilding to take 10 years, the 300th anniversary 

of New Orleans. We sincerely appreciate all of the resources Congress and the Administration have provided. In the future, however, we will need more Go Zone tax credits, additional funding for 

soft seconds, and last timeline extensions due to the complexities 

of mixing Federal, State, and local funds and regulations into one 

gigantic gumbo. 

Katrina has taught us that to be successful will take a spirit of 

humility and collaboration. We pray for God’s grace and God’s 

speed in the passing of this legislation. 

Please know of our prayers of gratitude to this Committee, to 

Senator Landrieu, and to its staff for all you have done and will 

do to bring home the good and brave people of Louisiana and the 

Gulf Coast. 

Thank you. 

Senator REED. Thank you, Mr. Kelly. 

Ms. Paul, please. 

STATEMENT OF EMELDA PAUL, PRESIDENT, LAFITTE 

RESIDENT COUNCIL 

Ms. PAUL. Thank you for the opportunity to speak to you today. 

My name is Emelda Paul. I was a 30-year resident at the Lafitte 

and I am the President of the Lafitte Resident Council. 

I am here because I want our people, our families, to return 

home to New Orleans. I want to thank Congress for creating this 

legislation, which will improve our housing and make our community better. We cannot wait any longer. The longer the situation 

drags out, the harder it will be for our people to come home. 

To make Lafitte a stronger community and a better place, I believe that there are several commitments that must be made. 

Every resident should be able to come home. Every unit that was 

taken down should be replaced with a unit that would be affordable 

to the residents. Counseling should be available to those who need 

it. And most importantly, redevelopment groups should work with 

the residents, like Providence has with us from the very beginning. 

They have listened to our needs and asked questions, like how 

many bedrooms do we need? What kind of assistance or help do we 

need? Do we need child care, job counseling, or supportive services? 

When I see and hear some of these people who are fighting the 

redevelopment, I ask myself who the heck are these people? And 

where were they when we really needed them? They are saying we 

should save the buildings. They are talking about bricks and mortar. We are talking about people’s lives. We are the ones who have 

to live there under these conditions. I cannot say for sure how 

many, but I can say there are a lot of people who think like me 

who want something better than what they had. 

I have been back to Lafitte, and from what I have seen I do not 

want to go back there anymore. I do not want to live like that anymore. I am living in the new Fischer Senior Village in New Orleans 

now. It is nice, clean, and safe. When I go from my apartment at 

Fisher to see my old apartment at Lafitte, it is very depressing. 

When you get up close to the building you see that the ground is 

sinking. I had mold in my bedroom way before Katrina. And now 

I have mold growing up the walls on both sides. If people are going 

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to come back, I want to see them coming back to something decent, 

something healthy, and something safe. I took photos of the flooding and what I saw from the window of my apartment after 

Katrina. 

People are under a lot of stress and want to come home. They 

want to come home to a new Lafitte with new apartments and new 

homes. They want something better for their families. So why can’t 

we allow those who want to come home to come home now and also 

take down and rebuild the site in the meantime? While we are sitting here bickering about what should be done, the people are the 

ones who are suffering. Some of them are dying. 

I think there are about 200 to 250 individuals, families, who 

want to come back right now. And probably 100 to 200 would want 

to come back in a couple of years because they are happy where 

they are living now. They have a decent apartment, their kids are 

in school, they have jobs and medical care where they are. They 

have to give something to come back to that is better than before, 

something that includes an emphasis on children like good schools, 

safe places to play, and medical care. 

I like the idea of phasing and I know that more and more people 

are excited about it. People can come home in apartments temporarily and participate in the planning of the redevelopment. We 

want new larger apartments for our children and our grandchildren where we can move around. 

People want to come home but we cannot have people living in 

the same condition they were living in before Katrina. We need and 

want up to date kitchen and bathrooms. We are tired of the patch 

jobs on the buildings from the 1940’s. If we bring people back, we 

want to make sure they have a safe environment. We want a new 

Jerusalem. The time is now. We have got to bring our residents 

home and build something better here for our children and grandchildren. 

Thank you. 

Senator REED. Thank you very much, Ms. Paul. 

Ms. Liu. 

STATEMENT OF AMY LIU, DEPUTY DIRECTOR OF THE METROPOLITAN POLICY PROGRAM, THE BROOKINGS INSTITUTION 

Ms. LIU. Good morning, Chairman, members of the Committee. 

I am pleased to be here before you this morning and pretty much 

appreciate your invitation. 

The purpose of my testimony is to provide an overview of the 

state of recovery of Greater New Orleans since Hurricane Katrina. 

The overview draws a wide array of data that we at Brookings 

have been collecting since the storm in 2005. 

I apologize, Senator Shelby, I do not have data on the State of 

Alabama. 

But my hope is that this basic baseline picture will give you important context as you consider legislation to provide affordable 

housing in the region and any future legislation aimed to improve 

the future of the Gulf Coast. 

So here is what we know about who lives in New Orleans, who 

has yet to move back, and the extent of the housing market 2 years 

after Katrina. 

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First, how many people are back in the city? Two years after the 

storm, the best and most reliable population estimates indicate 

that the city of New Orleans has recovered 68 percent of its prestorm households, which is a big jump from about a year ago when 

just half of the residents had returned. 

However, the city now makes up less than one-third of the region’s population. So that means there is enormous growth and 

shift out to the suburbs. Post-Katrina, almost all of the surrounding parishes, except for St. Bernard, have reached or exceeded the number of households they had before the storm. 

Second, who is living in the city now? The latest detail that we 

have on the details of who is living in New Orleans is for 2006, 

which is 1 year after Hurricane Katrina but I think the data is still 

revealing. The population living in New Orleans is now more educated, it is less poor by 6 percentage points less poor, and it consists of fewer renters than in 2000. 

Further, there are dramatically fewer households with children 

today. That share has dropped from 30 percent before the storm to 

just 17 percent today. 

Yes, the city is also more white but the city remains a majority 

black community. Approximately 58 percent of the city’s population 

is still African-American. 

Third, who has yet to return to the city? Approximately 197,000 

residents remain displaced or have not returned to New Orleans 1 

year after Katrina. Of these displaced, 70 percent are AfricanAmerican and 38 percent live below poverty. So many of these low 

income African-American families remain widely dispersed across 

the Nation. The Census data does confirm that in 2006 many 

former black and lower income New Orleanians were still most 

likely to still live in Houston, Dallas, the Atlanta metropolitan 

areas, and other parts of the South in the U.S. In contrast, former 

white and wealthier households mostly stayed nearby, mostly relocated somewhere else in New Orleans area. 

Fourth, on housing, the main concern here is that the cost of 

housing and rent levels have escalated 2 years after Katrina. Home 

prices have definitely jumped up in St. Tammany and Jefferson 

Parishes and the less impacted parts of New Orleans. Fair market 

rents in the region have risen an astounding 45 percent in the last 

2 years. And meanwhile, the demand for housing assistance remains high. We have talked about that today. 180,000 households, 

for instance, have applied for the Road Home program and as of 

August only 22 percent of those have been served. 

Fifth, I just want to say on the economy the New Orleans region 

has recovered the vast majority of its job base and labor force. But 

the real challenge there is that for two key sectors, health and education and leisure and hospitality, they are still missing one-quarter the pre-Katrina workers which is making it hard to recover the 

schools, the health care services, and the level of tourism. 

In closing, what I want to do is point to just some of the implications of these trends for Federal housing and other efforts. First, 

I think the strategies to boost the supply of affordable housing are 

still critical to help soften home and rent prices, and that is why 

the Senate bill is so critical. 

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On the private sector side, I do want to say that the data shows 

that just one-quarter of the new housing units that are being built 

in the New Orleans region is dedicated multifamily housing. So 

with very new hard units, one other thing the Federal Government 

can do is to aggressively recruit existing apartment owners to accept Federal housing vouchers. One of the things we have to realize 

is giving families a voucher does not guarantee them housing. 

Second, Federal leaders should consider making affordable housing available not just in the city but also in the job centers in the 

suburbs. Much of the data again point to the explosive population 

growth and job growth in the suburbs, and as well an increasing 

number of low-income families and Hispanics that are now emerging there. 

Third, given the many low-income African-American families 

that are still in the diaspora, we must not forget them. We must 

give them affordable housing options and perhaps affordable housing in those far-flung destinations. 

I want to close with the fact that it is clear that a strong Federal, 

State and local partnership is still very much due to address the 

outstanding challenges in the Gulf Coast. I want to say that future 

recovery efforts must go beyond just the focus on speed, which 

tends to be the conversation. We need to focus on the quality of recovery. 

Prior to the storm, New Orleans was plagued with high concentrations of poverty, a stagnant economy with a weak workforce, 

and a region that was growing in unsustainable ways. No doubt 

the city has enormous assets. But future Federal investment and 

taxpayer dollars must not rebuild the exact same city and metropolitan area. It must rebuild a greater New Orleans that rebounds 

from Katrina as a better version of itself: safer, economically robust, with mixed-income neighborhoods and opportunities for all 

residents. 

So once again, thank you for the opportunity to appear before 

you today. 

Senator REED. Thank you, Ms. Liu. 

Mr. Bright, please. 

STATEMENT OF EDGAR BRIGHT, PRESIDENT, STANDARD 

MORTGAGE CORPORATION 

Mr. BRIGHT. Thank you, Senator Reed, and Ranking Member 

Shelby, and Senator Landrieu and Congressman Jefferson, for inviting me to testify today on behalf of the Mortgage Bankers Association on some of the challenges we still face in Louisiana two 

years after Hurricanes Katrina and Rita. 

I would like to relate to you my personal story as a lifelong resident of New Orleans and a business owner in that great city. After 

the storm our homes and our headquarters were flooded. This is a 

picture. My house was two blocks behind that pearow and the 

school where my three kids attend was one block to the right of 

where that pearow is. And that was one week after the storm. 

After the storm our homes and our headquarters were flooded 

and we could not return to our building for six weeks. We moved 

temporarily to Baton Rouge while some of my staff pulled all essential data and files from our headquarters. We instituted forbearsmartinez on DSKB9S0YB1PROD with HEARING

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ance for payments on all loans in the Katrina area. This caused 

major capital shortage for us. We borrowed significant funds to 

make investor payments and meet payroll. We also made sure our 

customers had access to their loan and insurance information and 

reassigned 75 percent of our staff to process the paperwork. 

The industry and our regulators also responded. The entire industry instituted broad forbearance and began to try to contact customers who had been evacuated and were now across the country. 

The mortgage industry created a working group made up of lenders, servicers and their trade associations to help work on public 

and private sector problems and solutions. An industry practice 

was established that forbearance in the worst impacted areas 

should continue and be revisited every 90 days. This was a watershed event and it helped avoid mass foreclosures. 

Congress and the President put the region on the path to recovery by providing emergency funding for the CDBG program. Despite efficiency issues in dispersing funds, lenders and homeowners 

see that the money is on its way even if it is coming slowly. 

While implementation of this program has not been at the pace 

we would all like to see, it is important to remember the enormous 

task at hand. Establishing a whole new rebuilding program under 

crisis conditions is unprecedented. 

Now one of the greatest challenges we face is the conveyance of 

FHA properties. FHA current policy says payment of an insurance 

claim will only occur when it takes title to a property as a result 

of foreclosure. To convey a property and receive insurance benefits, 

however, FHA requires a property to be fixed up so it can be sold 

again. We are a small company and cannot afford to rebuild all of 

the damaged properties in their hurricane area. 

Right now these properties sit vacant, blighted properties seen 

block after block deteriorate neighborhoods and hinder the rebuilding effort. 

There are important lessons for future action which I discuss at 

length in my written testimony. The National Environmental Policy Act, or NEPA, hamstrung the States in how they could design 

their grant distribution program. The President should be able to 

activate NEPA exemptions for the purpose of rebuilding pre-existing housing. 

Second, Federal agencies are not permitted to give recipients of 

Federal assistance duplicate benefits. While in theory this makes 

sense, in practice it is causing deficiencies for individuals and businesses. 

Third, valuations and appraisals of damage properties are often 

conducted numerous times by numerous agencies. There should be 

some mechanism to share this information. 

Last, MBA recommends prohibiting FHA from adding requirements that are above and beyond those determined acceptable by 

EPA and the appropriate State environmental agency in the production of affordable rental housing. EPA and the States are well 

qualified to determine environmental standards so it only delays 

critical production when HUD also adds requirements. 

The mortgage industry responded admirably to the many challenges of Katrina and Rita, despite significant cost. We will do all 

we can to ensure that the region is rebuilt better than ever. We 

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have shown our willingness to sacrifice but that will not be enough. 

This is a national problem and the national solutions need to continue to ensure that the region returns better than it ever was. 

Thank you for allowing me to testify. 

Senator REED. Thank you very much, Mr. Bright. 

I want to thank all the panelists for the excellent and concise 

testimony. 

I understand Senator Landrieu has to depart so I would yield my 

time initially to Senator Landrieu. 

Senator LANDRIEU. Thank you. 

Just one question and, unfortunately, I have a press conference 

with another Senator in just a few minutes that I am obligated to 

go, but I look forward to working with all of you. 

Thank you for your extraordinary testimony and your hard work 

to explain a very difficult and unprecedented problem and solutions 

to the problem. 

My one question to you, Mr. Kelly, would be why do you think 

that this bill or something like it is so important to pass? And 

what, in your view, will happen if something like this does not 

pass? 

Mr. KELLY. Senator, I think in your remarks you summed it up 

very well. This is not about an either/or proposition. This is about 

not a compromise. This is about a right ground solution. 

I have worked with the homeless. I have worked with the poor 

my whole life. I have worked with the working poor. If we do not 

do this, we do not bring people. If you do not bring back the elderly, you do not bring back child care. If you do not bring back elderly, they are a certain critical element of every community. If you 

do not bring back children, you do not bring back your future workforce. 

Why would we not want to bring back the working poor? Those 

are the people who care for our folks in nursing homes. Those are 

the people who care for our children in child care. They are the 

people who work in the dry cleaners and the restaurants. The 

working poor are a part of who we, as a Nation, are. They are a 

part of our economy, as well as people that we love and we respect 

and we work with every day. 

If we do not pass a bill like this, then we are showing a lack of 

leadership. That is what we are being criticized for. We are being 

criticized for a lack of leadership. And people are looking for leadership. People want to come home. We have the highest percentage 

of natives of any State in the union. It is about faith, it is about 

family, it is about food, and even with the Saints’ disappointing 

loss, it is about football. 

But it is critical. People want to come home. It is a part of the 

fabric of who New Orleans is. When you say to somebody what is 

the first question you ask? How’s your mamma and them? 

We are a community that is very unique. But if we do not allow 

our whole community to come home, then shame on us. 

Senator REED. Senator Shelby, please. 

Senator SHELBY. Mr. Kelly, we all want to help the people of 

New Orleans. I think that is a common thread. But we want to be 

smart in what we do. We want you to be smart in what you do. 

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I am not a native of New Orleans but I love New Orleans. We 

would like for the Saints to do better. We hope for them, because 

we are from the South. 

Mr. KELLY. What about LSU? 

Senator SHELBY. Well, we are a little nervous about LSU because 

they play the University of Alabama. We have got their former 

coach but we need their players, too. 

But as far as New Orleans is concerned, I think we—and I speak 

for myself—we want to do everything we can to make you whole. 

The Port of New Orleans is very, very important—that is why 

New Orleans, among other things exists—to America. We realize 

that. We think families are very important to all of us, as you alluded to. But we have got to be prudent in what you do. And I hope 

you will not build in the flood-prone areas. I mean, that is just 

something that I would not want the people in my State to do. But 

you have tough geography there and I realize that. 

I want to direct my next question and pick up on what Ms. Liu 

testified to. I guess are there, in the city of New Orleans, vacant 

apartments that if we had vouchers could a lot of the poor people, 

working people, can they get some of those apartments? Or of the 

apartments in the greater—in the metropolitan area? 

In other words, here are the vacancies now that are ready to be 

rented. And would that help alleviate some of the shortage, if we 

had a voucher system? 

Ms. LIU. First of all, I know that there has been a high number 

of rental units that remain damaged, almost as many as the homeowner units. So I think that—— 

Senator SHELBY. So they are not ready for occupancy then, if 

they are damaged? 

Ms. LIU. I think there are some and I think there are some in 

the larger region. My only concern is there is a lot of emphasis on 

vouchers for families and yet there is not a discussion or aggressive 

solution about where these vouchers are going to be used. And are 

we working with the private sector to ensure that such housing 

does exist? 

Senator SHELBY. Sure. 

Ms. LIU. I think in the interim if the private sector, if most of 

the apartments that are available are in the New Orleans region 

but in the surrounding parishes, I think we should reach out to 

those apartment owners as well. 

Senator SHELBY. I think you should. 

Mr. Kelly, do you have a comment? 

Mr. KELLY. Yes, sir. We deal with this in case management all 

the time, trying to find apartments for folks. The No. 1 issue was 

referred to, 45 percent increase in rents. So how does the working 

poor afford a 45 percent increase in rent? 

Senator SHELBY. That is tough. 

Mr. KELLY. We do have Go Zone credits that are now being put 

into use. But to rebuild and redevelop a former apartment complex 

is not happening overnight, especially with the construction and 

the insurance issues. But that will happen but it will not be 

enough for the amount of units that were destroyed. 

Senator SHELBY. Mr. Bright, you mentioned you are in the mortgage business and you know a lot about housing and finance. In 

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your testimony, and correct me if I am wrong, you suggested that 

FHA should pay claims on properties that were damaged by 

Katrina that are currently not in habitable condition. As FHA currently—you know what the law is. FHA does not currently factor 

into its FHA premiums catastrophic events. In other words, they 

do not have flood insurance in the FHA premium. But I believe everybody ought to have flood insurance who is in a flood-prone zone. 

If I understand your proposal, this would have FHA insure lenders against a risk which the lender did not pay a premium for. 

So I guess the question that I would ask, should FHA pay these 

claims, do you believe that FHA should raise its premiums to offset 

the additional risk—because there is risk here—of providing catastrophe insurance? Or should be lenders be covered by this risk at 

the expense of the taxpayer? 

In other words, FHA was never—we never contemplated the Federal Housing Administration to do this, to cover these. I understand what you are talking about. We are very interested here in 

the Senate in a meaningful comprehensive flood insurance program, which I think we have not had and has not been required 

and implemented well. 

Do you want to comment on that? 

Mr. BRIGHT. Sure. There is a lot in that question. I will try to 

be concise. 

Specifically, there is a technicality in the FHA contract. These 

houses, there are about 8,000 homes we think, that are people that 

were flooded but not in a flood zone area. So therefore we, as the 

lender, would not have charged them flood insurance because they 

would have said we were gouging them—— 

Senator SHELBY. They were not in it, but they should have been 

if we had had a good program. 

Mr. BRIGHT. Right. I mean 99 percent of the people have flood 

insurance. These are people that did not have flood insurance because they were outside of the flood zone and they flooded anyway. 

So that is specifically what this would cover. 

Let me also say if they got a Fannie Mae loan or a Freddie Mac 

loan, this would not have been an issue for them. So that is one 

reason why the FHA program is not as popular as the Fannie loans 

and the Freddie loans. 

So when you all fix, when you modernize the FHA, I believe you 

should address this issue. 

Senator SHELBY. Well, I hope we are going to address it—flood 

insurance—in a meaningful way because I have been, myself, very 

concerned about our flood insurance program, the inadequacies of 

it, the role that leaving out areas that are flood-prone and we pay 

for it in the long run, do we not? 

Mr. BRIGHT. I would also like to say the FHA is a great program, 

as is the Fannie and Freddie program. Those loans you still can get 

funding for that. There is no problem with all of the subprime that 

you hear about. Those loans work just fine. And in our area that 

is something that is working. 

Senator SHELBY. Thank you. Thank you, Mr. Chairman. 

Senator REED. Thank you, Senator Shelby. 

I want to thank all of the witnesses for their excellent testimony, 

insightful and articulate. 

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Mr. Perry, I think you have given HUD a reason to go back to 

those trailers and see how many people really are qualified for 

housing. Thank you for all of your good work there. 

Mr. Brown, it was kind of frightening to listen to your tale of woe 

about how you could not find support, particularly from HUD, to 

do what your faith-based mission was, to help house these seniors. 

But thank you for your persistence and your efforts. 

Ms. Paul, thank you for your leadership at Lafitte. I used to say 

Lafayette, but I am from Rhode Island. 

Ms. PAUL. It is Lafitte. 

Senator REED. It is Lafitte. I know. I stand corrected. 

Mr. Bright, thank you. 

Let me start questioning with Ms. Liu. Your analysis, and this 

is sort of a simpleminded approach, but the price of rental property 

has gone up 42 percent. If we are not replacing one-for-one destroyed housing, that price is not likely to come down but to go up. 

Is that simple economics? Is that fair? 

Ms. LIU. Yes, we have a real chicken and egg problem right now 

in terms of making sure that we are, as we are trying to immediately provide affordable housing for many of these residents, that 

the construction for rental property is just really lagging. Again, we 

have spent the first 2 years focusing a lot on homeowners and single-family homes. 

Again, if you look at the data, even with one-for-one, multifamily 

units are not going up as a small share of the total pie. And because of the insurance costs and other things, there is a lot of concerns that tax credits are not being used. 

So I think every resource that we have to expand the supply of 

rental units is really critical right now. 

Senator REED. And the policies, I discern from the Assistant Secretary’s comments, are not designed to accelerate the production of 

housing. They are not talking about a one-for-one replacement. 

They are talking about tax credit programs which you suggest in 

your analysis might not induce the market to provide the rental 

housing because of other factors like insurance costs? Is that a fair 

point? 

Ms. LIU. That is fair. 

Senator REED. They are also talking about vouchers. But without 

units, vouchers is a piece of paper in your pocket but not a roof 

over your head. 

Is this a strategy simply to look like you are doing something but 

end up not doing anything at all? 

Ms. LIU. Well, I appreciate their spirit of not wanting to maybe 

re-create the concentrated poverty that was there in the city before, 

but I think we have to be very pragmatic in the short term about 

whether or not we are creating enough units for families to come 

home. And whether I think we should—this is a 10-year recovery 

effort. 

So I think in the short term what is the quickest way we can get 

some hard units on the ground. If that is public housing, let us do 

it that way. And over time, let the other options that he raised 

occur over time. 

Senator REED. Thank you. 

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Mr. Kelly, your project specifically made the commitment for onefor-one replacement. That was not at the suggestion of HUD. I 

think that was at your insistence. Is that correct? 

Mr. KELLY. Yes, sir. We have been at this since 1727. 

Senator REED. Longer than HUD. 

I go back. I am trying to sort out the Secretary’s testimony. The 

suggestions, I think, is that we are going to do it by tax credits. 

Even if those tax credits are taken up, you need a second subsidy 

which is the voucher for the public housing individuals. 

So you basically have two subsidies which may, in fact, per unit 

per family be more expensive than creating a public housing—a 

one-for-one public housing approach. Is that . . . 

Mr. KELLY. I think the tax credits are being used to fund the 

capital and I think you really have to separate those two eggs. But 

the issue is we have to make sure that it is affordability. The tax 

credits can be geared at 60 percent below. In public housing, you 

are dealing with a lot of people at 30 percent. And that is the issue 

on affordability. Tax credits do not solve the problem. 

Senator REED. Right. That is the point I was trying to reach with 

the Secretary, and my understanding is not as expensive as his, 

but if you have a tax credit regime that sets up of affordability levels at 60 percent of median income, than they do not have to serve 

anyone below that, I think. Is that correct? I am trying to figure 

out the program. Maybe Ms. Liu? 

Mr. PERRY. I think that is correct, that people who are at 30 percent may not get served. The ultimate problem is that public housing is being demolished now and we have to move quickly. That is 

what this bill provides us, an opportunity to move. 

Senator REED. Again, there are lots of regulations and laws, et 

cetera. But on the streets of New Orleans, if formerly resided in 

public housing, that unit is demolished, you cannot get into public 

housing. You may get a voucher. But that voucher does not allow 

you to go to any rental property in the city of New Orleans, walk 

up to the door and say here, you have got to put me. Is that fair? 

Mr. PERRY. I would agree. I can provide you a referral list of 

folks who have called our office and said well, I have a voucher. 

But everywhere I go they say that they do not take vouchers. And 

so I still cannot find a place to live, even though I have a voucher. 

Senator REED. Even if those places take vouchers, there is a certain amount of money that they expect to be paid also. Is that correct? Or am I missing the point totally? 

Mr. PERRY. Right, that is true. The tenant has to pay a portion 

of the rent, as well. 

Senator REED. And for many public housing people that is literally beyond their grasp; is that correct? 

Mr. PERRY. That is correct. 

Mr. KELLY. It gets more complicated when you get into the issue 

of utilities. So if it is a 30 percent income, but then you have got 

the utilities on top. 

I think one of the things that should be emphasized is under the 

public housing the ACC do not provide enough revenue to operate 

units successfully. That is part of why we have public housing in 

the disarray that it is. We really need to have many more projectsmartinez on DSKB9S0YB1PROD with HEARING

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based Section 8 vouchers so that these redevelopments can be done 

successfully and will last into the future. 

Ms. LIU. I was just going to echo that because I do think, and 

other folks on the panel and in the audience will probably know 

this, I know that the value of the housing vouchers have gone up 

to meet the increase in cost in that housing market. So in some 

ways that is a help. 

But if the tax credits are moving faster, if the developers are 

moving faster on breaking ground, the more we have project-based 

vouchers to tie with these tax credits the better off we will be. I 

know that we need to continue to push on expanding that. 

Senator REED. So essentially what I think you are suggesting is 

that we have a coherent strategy where it is not just tax credits 

to any developer, and then I related to that might give a voucher 

to a person. They have to be coordinated together, which I presume 

you are doing in Lafitte? 

Mr. KELLY. Yes, sir. 

Ms. PAUL. Yes. 

Senator REED. And that has to be the plan going forward for the 

other public housing units that are being demolished and replaced 

in some version. 

Is that the approach you have heard this morning from the Secretary, Mr. Kelly? 

Mr. KELLY. I think—I do not want to speak on behalf of the Secretary. I think Lafitte is a model of what the public housing redevelopments should and can be. It is about allowing people the right 

to come on. 

Senator REED. Thank you all very, very much. 

We will keep the record open for a week. This has been extremely informative. Thank you for traveling all the way up here 

to Washington. And thank you for your good work every day to 

help people, our neighbors, who need your help. 

I understand we have some ladies and gentlemen who were evacuees for Katrina who are here in the audience. Thank you for being 

here today, I guess, in picking up Mr. Kelly and Mr. Paul, seeing 

them bearing witness. 

Thank you. 

[Whereupon, at 11:15 a.m., the hearing was adjourned.] 

[Prepared statements and additional material supplied for the 

record follow:] 

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PREPARED STATEMENT OF SENATOR JACK REED 

I want to welcome everyone to this important hearing on housing needs in the 

Gulf Coast, and extend my appreciation to the witnesses who have taken time out 

of their busy schedules to come to Washington, DC to be before us today. I want 

to also recognize my colleague Senator Landrieu, who is testifying this morning, and 

acknowledge her efforts to secure resources and assistance for her constituents and 

all Gulf Coast residents. Her dedication to rebuilding the areas devastated by hurricanes Katrina, Rita, and Wilma are impressive, and I know she is here fighting 

every day to make sure families can return to their communities. 

We are here this morning because although two years have elapsed since hurricanes Katrina, Wilma, and Rita hit shore, unfortunately, there is still much to be 

done to rebuild devastated areas and help people return home. 

The hurricanes of 2005 destroyed or significantly damaged over 305,000 homes, 

and caused some level of damage to tens of thousands of others. Of the homes most 

damaged, over a third were occupied by renters. Two-thirds of the most damaged 

homes were in Louisiana. After the hurricanes, over 1.3 million Americans were 

scattered throughout the country, relying on friends, family, and others to meet 

their short-term housing needs. Longer-term housing needs have been met by the 

federal, state, and local governments, private non-profits, public housing agencies, 

and private landlords and property owners. 

Congress quickly responded after the storms to provide needed funds to help communities clean-up and recover, and to provide housing assistance to those displaced. 

However, anyone with a television can recount the horrors of watching the bungled 

recovery efforts in New Orleans. While those days seem long past, there are still 

many families who have been left stranded and unable to return to their communities. We are here today to explore how we can work together to help people return 

home. 

While more residents return every day, and old businesses open their doors, communities are still struggling to recover. New Orleans, the hardest hit area, has 

climbed back to 66% of its pre-storm population. Unfortunately, as we would suspect, those with low-incomes, minorities, renters, and families with children have 

been the least likely to return. Many of these families have no resources to move 

once again, and many have no homes to return to. 

With supplemental CDBG funds provided by Congress, the states affected by the 

storms have established grant programs to assist homeowners in rebuilding their 

destroyed homes, and in turn, their communities. In Louisiana, over 180,000 families have applied for funds through the State’s ‘‘Road Home’’ program, with over 

50,000 receiving grants to rebuild so far. And in Mississippi, almost 14,000 homeowners have received rebuilding funds. These programs have helped to jump start 

housing development throughout the Gulf Coast. 

There has been a major gap, however, in ensuring that there is adequate, affordable rental housing in the devastated areas. While GO-Zone tax credits have been 

allocated, and other plans are in place to rebuild some portion of the rental housing, 

the plans of HUD and the states leave low-income renters with significantly fewer 

options than before the storms. As I understand it, HUD expects to demolish much 

of the public housing in New Orleans and only replace about forty percent of it. 

While I believe that redevelopment must move forward and must result in 

healthy, vibrant, mixed-income communities, I am concerned that low-income families—including many children, people with disabilities, and seniors, will have no 

homes to return to if affordable housing is not replaced. 

In fact, affordable housing in New Orleans and throughout the Gulf has become 

even more elusive. Rents have increased by 40% and homelessness has doubled, despite the significant population decrease. 

Chairman Dodd and Senator Landrieu have introduced a bill, the Gulf Coast 

Housing Recovery Act, which would help ensure that families of all income levels 

can return to their communities, and I applaud their efforts. Their bill seeks to ensure that affordable housing is replaced in flexible and sensible ways—with resident 

and community input, in mixed-income communities, and through a variety of housing options. 

I know there are still serious housing problems throughout the Gulf Coast, and 

I look forward to hearing from our witnesses on what challenges remain and how 

we can work to build healthier and stronger communities in the devastated areas. 

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PREPARED STATEMENT OF SENATOR MARY L. LANDRIEU 

Chairman Reed, Ranking Member Shelby and Members of the Committee, 

Mr. Chairman, we can easily lose sight of the nature of this tragedy in statistics, 

when we are really talking about people, and homes, and neighborhoods. To begin, 

I would like to tell the story of two such people from my state. 

Gloria Williams and her twin sister Bobbie Jennings are 60 years old. They both 

lived in public housing in New Orleans before the hurricane struck. Gloria and Bobbie started working early in life. They picked cotton, strawberries, and snap peas 

in rural Louisiana. ‘‘We were raised to work,’’ they have said. They moved to New 

Orleans when their father drowned, their mother was later killed. They eventually 

both had careers as Certified Nursing Assistants, working in nursing homes for 

many years. They fed people, cleaned people, bathed people and cared for people. 

They raised families and had grandchildren. And like 25 percent of households in 

New Orleans, neither owned a car. But their years of hard, physical work took their 

toll, and now at 60 they both have serious physical ailments. Ms. Jennings had back 

surgery and suffers from high blood pressure. Ms. Williams has heart and lung 

problems, high blood pressure and blood clots that keep her from standing for very 

long. Their only source of income is their $600 a month disability check. Neither 

one has any pension. They tried to relocate to California, but the 3,000-mile distance 

from their family was too great. They’ve moved into a relative’s damaged home in 

Slidell. The only thing they want out of this life is a little dignity and recognition 

for having toiled all their lives, as good citizens and good neighbors. For them, that 

recognition would be to allow them to return home to New Orleans. Mr. Chairman, 

these are the kind of people that God put us on earth to help. As the Bible reminds 

us ‘‘Whatever you did for the least of My brothers and sisters, you did for Me.’’ 

Mr. Chairman, I am pleased to be here today to discuss housing needs in the Gulf 

Coast, and in particular, S. 1668, the ‘‘Gulf Coast Housing Recovery Act’’ introduced 

by Chairman Dodd and myself. Let me take this opportunity to again thank Chairman Dodd for generous advice and guidance in crafting this legislation and to Ranking Member Shelby for his work alongside the Louisiana Congressional delegation 

on the numerous Gulf Coast recovery-related issues. I would also like to thank Congresswoman Maxine Waters and House Banking Chairman Barney Frank for showing such initiative on this vital subject for the Gulf Coast. Their early leadership 

on this subject speaks volumes about their compassion for the suffering of the people of the Gulf Coast. We will not forget their efforts. 

Our ability to rebuild homes and communities will determine the success of overall long-term recovery efforts in the region. To illustrate the interconnectedness of 

our problems consider this, in Louisiana alone we had over 18,000 businesses destroyed. Yet time and time again, I am told that the biggest hurdle to business 

growth in New Orleans is the absence of affordable housing. Louisiana also had 875 

schools destroyed. Again, teachers cannot come back to school and teach our children if they do not have a roof over their heads. Housing is where recovery must 

start! 

The official title for this hearing ‘‘Two Years After the Storm: Housing Needs in 

the Gulf Coast’’ suggests that there was only one storm that hit the Gulf Coast in 

2005. In fact, the Gulf Coast was hit by three storms in 2005: Katrina, Rita and 

Wilma. Katrina struck the Gulf Coast on August 29, 2005, which was damaging 

enough to my state. If that was enough though, in New Orleans there were also 

28 separate Federal levee failures which flooded 12,000 acres—or 80 percent of the 

city—following Katrina. Then one month later, Hurricane Rita made landfall in 

southwestern Louisiana and southeast Texas with winds in excess of 115 mph and 

a significant storm surge. In terms of the impact of Hurricanes Katrina and Rita, 

and the failure of the Federal levees on housing in my state, we had more than 

200,000 homes damaged or destroyed. These properties run the gamut from singlefamily homes to multi-family homes to rental units. However, owner-occupied and 

rental housing were not the only types of housing damaged by the storms. There 

were over 7,000 public housing units damaged in the New Orleans area alone with 

more than 5,000 public housing residents displaced. 

Furthermore, according to a January 2005 study by UNITY of Greater New Orleans, a collaborative of 70 nonprofit and government agencies in Orleans and Jefferson Parishes, there were 6,300 homeless in the New Orleans area. As a result of 

Hurricane Katrina and the levee breaks, in January 2007, the homeless population 

had almost doubled to an estimated 12,000 homeless, though only 60 percent of the 

city’s general population had returned. These homeless residents are living in abandoned housing, on the streets, in cars or in housing designated for the homeless. 

The number is steadily increasing because the extraordinarily high cost of development has added to the challenges of rebuilding affordable rental housing along the 

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Gulf Coast which has significantly reduced the number of deeply affordable rental 

units. For example, according to a June 2007 report by PolicyLink, a national research institute, rents have increased in the area by as much as 40 to 200 percent 

since the storms, leaving few apartments affordable to families making less than the 

area median income. All of these factors are creating an affordable housing crisis 

in the area but especially in New Orleans. As I mentioned above, this crisis threatens our recovery as, before the storm these residents of affordable housing were essential to our workforces in the tourism, hospitality, and service sectors which, as 

you know, are the lifeblood of the New Orleans economy. In fact, New Orleans employers are seeking to fill 15,000 hospitality industry jobs, 10,000 public health/hospital industry jobs, and almost 10,000 construction jobs. We cannot fill these jobs 

without affordable housing for these vital workers. 

Given the ongoing housing needs in the southern part of my state, as well as all 

across the Gulf Coast, I was pleased that H.R. 1227, the ‘‘Gulf Coast Hurricane 

Housing Recovery Act’’ passed the House of Representatives on March 21, 2007. 

This legislation, introduced by Representative Waters and Representative Frank, 

addresses many of the major housing-related problems in my state, especially as 

they relate to public housing, rental housing, and those who were made homeless 

by the storms. When this legislation was received in the Senate, I begin working 

closely with Chairman Dodd to review H.R. 1227 for ways to strengthen this important legislation. To further this goal, we consulted with all relevant stakeholders, 

including public housing residents, community leaders, nonprofits, developers, and 

Federal/State/local officials on areas where the House-passed legislation might require adjustments or improvements. 

The legislation we are discussing today, S. 1668, the ‘‘Gulf Coast Housing Recovery Act’’ is the product of these months of intensive consultations. As a testament 

to the comprehensive, yet balanced approach in this bill, I note that S. 1668 is supported by at least 43 national organizations, 34 Gulf Coast organizations, in addition to the State of Louisiana and the City of New Orleans. This legislation, the 

Senate companion to H.R. 1227, is similar to the House-passed bill in some places; 

in others it really improves upon what was included in the House bill. For example, 

there were an estimated 18,000 distressed properties in New Orleans before the 

storm, but as a result of Katrina and the subsequent levee breaks, there are now 

at least 32,000 such properties. Distressed properties like this need a clear title and 

to be brought up to code, then they can be returned to the housing market rather 

than sitting idle or blighted. The New Orleans Redevelopment Authority (NORA) 

has the power to address this particular issue but lacks sufficient funding. To these 

ends, H.R. 1227 included $15 million for NORA to carry out a pilot program to purchase and bundle properties, then sell them for redevelopment. After talking to Representative Richard Baker, who championed this provision on the House side, we 

were able to include $25 million for NORA in S. 1668 so they can ‘‘hit the ground 

running’’ with this program. In addition to this funding, we also added an additional 

$25 million in the Senate bill for other redevelopment authorities in Katrina/Rita 

declared areas in Louisiana to carry out similar programs. 

Another important provision that we retained in S. 1668 from the House-passed 

legislation was an authorization of funding for 4,500 units of supportive housing for 

the elderly, the disabled, and the homeless—the most fragile of our population. 

3,000 of these vouchers would be reserved for Louisiana, with the rest going to other 

impacted Gulf Coast states. I note that the Senate has already passed this particular proposal. It was included as a floor amendment that I offered as part of H.R. 

4939, the Emergency Supplemental which was enacted last summer. However, 

much to my chagrin, and to those working on this issue in my State, this important 

provision was taken out by the House of Representatives in final negotiations on 

the Supplemental. As a member of the Senate Appropriations Committee, I plan to 

work closely with this Committee and my colleague Senator Patty Murray, Chairman of the Transportation, HUD Appropriations Subcommittee to secure this funding in the next Emergency Supplemental. Chairman Murray recently committed to 

me on the Senate floor to work to include this particular funding in the Supplemental. The authorization in this bill has been essential to push this issue forward 

and gamer additional Senate/House support for these efforts. 

Furthermore, before Hurricane Katrina, at approximately 40 percent, New Orleans had one of the lowest homeownership levels of any metropolitan area in the 

country. As we rebuild this vibrant city, in my opinion, increasing homeownership 

should be one of the tenets of the redevelopment process. It is essential to return 

residents to public housing, rental units, and other affordable housing but in order 

to truly spur long-term recovery and economic development; we should also create 

homeownership opportunities for these families. With this in mind, S. 1668 includes 

an additional $5 million for NORA to provide soft-second mortgages and directs the 

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Federal Housing Administration to convey foreclosed/distressed properties to NORA 

for affordable resale to these low-to-moderate income residents. These provisions are 

important steps towards not just returning displaced residents home but giving 

them the chance to own that home. 

Following Katrina and Rita, there has been a great deal of emphasis placed on 

rebuilding Gulf Coast owner-occupied and rental housing, as there should be. The 

recovery of public housing, however, is one area that has not received much national 

press even though public housing residents have the same right to return home and 

rebuild as homeowners or renters. Prior to Katrina, the Housing Authority of New 

Orleans (HANO) operated 7,379 public housing units, 5,146 of which were occupied. 

As you may know, HANO has long been a troubled agency and has been plagued 

by mismanagement. This in part, has contributed to the poor condition of some public housing in New Orleans and the negative stereotype that many in the area have 

of public housing. It should be noted however that despite that negative perception, 

before Katrina almost 85 percent of these public housing residents were employed 

and many of them are now employed in other cities, with children in school there. 

Some former public housing residents are settled in these other cities and do not 

want to return to New Orleans. That is their choice, however, many other residents 

do want to come home and participate in the recovery of their communities. 

H.R. 1227 provides the process and means for returning these New Orleans public 

housing residents home. The House-passed bill includes a resident study to find out 

which residents want to stay where they are, which residents want to come back 

to public housing in New Orleans, and which residents would like to return to New 

Orleans with rental or Section 8 assistance. This study would guide redevelopment 

plans of public housing in New Orleans and the Department of Housing & Urban 

Development supports this provision. In fact, I understand that after both H.R. 1227 

and S. 1668 were introduced, HANO started conducting a study modeled on the provision in the legislation. H.R. 1227 also specifies that HANO shall not demolish the 

7,379 public housing units unless there is a plan in place to provide for one-for-one 

replacement of the disposed units. This particular provision ensures that all public 

housing residents who want to return can do so—to either public housing or other 

affordable units. 

S. 1668 retains these provisions but strengthens them in a few important ways. 

For example, just as in H.R. 1227, our bill sets out that all 5,146 pre-Katrina occupied units shall be replaced with hard units—which can be public housing, affordable housing, or vouchers tied to affordable units. However, unlike the House bill, 

for the remaining units, the Senate bill allows HANO to replace these units with 

hard units or with project-based vouchers tied to units in low-income neighborhoods/ 

areas undergoing revitalization. This is because some residents want to return to 

public housing, but there are others who would like to transition to other types of 

units. Our bill would set out this ‘menu of options’ for both residents and developers 

alike, allowing them to work hand-in-hand to rebuild public housing. And we 

worked closely with developers in the area who have already committed to responsible replacement of public housing, such as Providence Community Housing who 

is testifying today, to ensure that our bill will move development forward, while still 

providing sufficient guarantees for resident participation/input. Just as important, 

however, is that S. 1668 ensures that affordable housing will not be lost at a time 

when it is most needed. 

In closing, let me reiterate that this bill addresses one of the most fundamental 

needs following a disaster: the need to return home. Whether residents live in million dollar mansions, rental housing, or public housing they all share the same desire to return to their communities, and in particular, their own homes. The House 

of Representatives has done its part to help these public housing residents, renters 

and homeless individuals so now it is up to the Senate, and this Committee, to act 

upon this legislation. I look forward to working closely with Chairman Dodd, Ranking Member Shelby, and the other members of the committee to hopefully reach an 

agreement on moving S. 1668 forward to the full Senate for consideration. 

Mr. Chairman, this concludes my prepared statement. I ask unanimous consent 

to include a list of organizations supporting S. 1668 in the Record, along letters of 

support from both the State of Louisiana and the City of New Orleans. At this time, 

I would be pleased to respond to any questions that you or other members of the 

Committee may have on this issue. 

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RETURN TO NEW ORLEANS; RESIDENTS SHOULD GO HOME TO NEW AND BETTER

PUBLIC HOUSING

The Washington Post, Monday, April 30, 2007 

Editorial 

Twenty months after Hurricane Katrina, public housing residents of New Orleans 

remain scattered across the country. Many want to go home. They should be able 

to. But returning to the same squalid and dangerous housing projects that were isolated cauldrons of dysfunction and pathology is neither just nor humane. Katrina 

changed everything in the Crescent City, and its public housing must change, too. 

That’s what the U.S. Department of Housing and Urban Development is trying to 

make happen. But a lawsuit filed by the Advancement Project, a Washington-based 

civil rights organization, against federal, state and city officials is holding things up. 

New Orleans public housing before Hurricane Katrina was gripped by drug and 

gang activity, making the projects among the most dangerous areas in the city. Corruption and mismanagement led the federal government to take over the Housing 

Authority of New Orleans in 2002. HUD was in the process of redoing some of the 

public housing in the mode of HOPE VI developments that favor townhouse design 

and mixed-income residences over brick apartment buildings that warehouse the 

poor. Then Katrina hit. 

The Advancement Project lawsuit claims ‘‘defendants’ inaction and needless delay 

in repairing and reopening New Orleans’ public housing development are based on 

racial animus and a clear intention to prohibit the return of many low-income African-American families.’’ It demands a halt to HUD’s planned demolition of troubled 

projects and a right of return for everyone to their old apartments in public housing. 

Unfortunately, comments by HUD Secretary Alphonso Jackson (New Orleans ‘‘is not 

going to be as black as it was for a long time, if ever again’’), Rep. Richard H. Baker 

(R–La.) (‘‘We finally cleaned up public housing in New Orleans. We couldn’t do it, 

but God did’’) and New Orleans City Council President Oliver Thomas (‘‘We don’t 

need soap-opera watchers all day’’) served to fuel the conspiracy theories underpinning the lawsuit. They also roiled long-troubled racial waters in New Orleans. 

Judge Ivan Lemelle pushed aside the racial charges and denied an injunction 

against razing the housing projects. But a jury trial is set for Nov. 26, and Judge 

Lemelle has ordered the Advancement Project and HUD to try to settle before then. 

At stake is the transformation of four public housing projects built in the 1940s— 

C.J. Peete, St. Bernard, B.W. Cooper and Lafitte—from fortresses of concentrated 

poverty into mixed-income communities. The nonprofit developers of Lafitte, for instance, are doing just about everything the Advancement Project says it wants—and 

what a House bill making its way to the Senate would mandate—while at the same 

time following through on HUD’s vision for renewed, reconnected and revitalized 

public housing that no longer isolates the poor. 

Enterprise Community Partners has committed to a one-for-one replacement of 

public housing units at Lafitte and to a right of return for former Lafitte residents. 

The developer has traveled to Houston and Baton Rouge to get residents’ input. By 

renovating some of the units at one end of the project while tearing down and building the New Orleans-style homes on the other end, Enterprise would make it possible for former Lafitte tenants to return to New Orleans now. But everything is 

on hold; no one can get started until the Advancement Project’s trial concludes. 

The problem is compounded by a July 1 deadline for developers to spend 10 percent of a project’s total development cost using Gulf Opportunity Zone low-income 

tax credits or risk losing them. In that case, everyone loses. Considering that many 

of its objectives are being met, the Advancement Project should take yes for an answer and let demolition begin. The displaced people of New Orleans have waited 

long enough to go home. If they can go home to apartments better than the ones 

they fled, that should be applauded, not denounced in court. 

IN DIVIDED NEW ORLEANS

The New York Times, Tuesday, May 15, 2007 

Editorial 

When President Bush spoke to the nation soon after Hurricane Katrina, he was 

resolute that the city would be rebuilt. ‘‘We will do what it takes,’’ he said. We— 

the federal, state and city governments; elected officials and the citizens who hire 

them—have failed spectacularly. Homes and schools remain empty or imaginary; 

evacuees and survivors wait in cramped trailers, unable to return or rebuild. A huge 

silence still hangs over the Lower Ninth Ward, a place every American should see, 

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to witness firsthand how truckloads of promises have filled New Orleans’s vast devastation with nothing. 

That the Lower Ninth is overwhelmingly black is not irrelevant. African-Americans were the predominant and poorest members of this city before the storm, they 

bore the worst of it and have the farthest journey back to stability. A study issued 

last week by the Kaiser Family Foundation, based on interviews last fall with residents of Orleans, Jefferson, Plaquemines and St. Bernard parishes, maps the outlines of a sharp racial divide. 

In Orleans Parish, twice as many African-Americans as whites said their lives 

were still ‘‘very’’ or ‘‘somewhat’’ disrupted. Seventy-two percent of blacks said they 

had problems getting health care, compared with 32 percent of whites. Blacks were 

more likely to say that their financial status, physical and mental health, and job 

security had worsened since the storm. And they expressed considerably more anxiety than whites about the sturdiness of the rebuilt levees, the danger from future 

Katrinas and the prospect of living without enough money or health care, or a decent, affordable home. 

There was a consensus about broad categories of the recovery: solid majorities 

thought there had been at least some progress in restoring basic services, reopening 

schools and business and fixing levees. But in three vital areas—rebuilding neighborhoods, controlling crime and increasing the supply of affordable housing—most 

agreed that there had been no progress or ‘‘not too much.’’ 

Even with the constant trickle of bad news, you can find minimal improvements. 

Thousands of building permits have been issued. A crisis was recently averted when 

the Bush administration extended temporary housing assistance for tens of thousands of displaced families. Some government housing subsidies that were to expire 

at the end of August will continue until March 2009. 

It is also encouraging that administration of the housing program will shift from 

the Federal Emergency Management Agency to the Department of Housing and 

Urban Development, which has always been the logical choice, given its experience 

in housing needy families. Other positive signs include the halting progress toward 

a workable redevelopment plan, and a recent finding that the city’s population had 

grown to above half of its level before the storm. 

The Kaiser survey even found signs of hope when it tested for resilience in a 

proud city. Sixty-nine percent of respondents said they were optimistic about New 

Orleans’s future. And only 11 percent said they planned to leave. 

Their faith must not be betrayed. Residents in the survey were keenly aware that 

their city’s fitful recovery would be devastated if the levees failed again. They put 

strong levees above all other priorities, including fighting crime and even basic services like electricity and water. And yet National Geographic has reported that an 

engineer has found signs that levees were poorly rebuilt and are already eroding. 

There is no room for error here. 

HOME SWEET HOME; NEW ORLEANS PUBLIC HOUSING RESIDENTS DESERVE BETTER

THAN WHAT THEY HAD BEFORE HURRICANE KATRINA

The Washington Post, August 27, 2007 

Editorial 

Public Housing advocates are gearing up for a sit-in at the offices of the Housing 

Authority of New Orleans tomorrow. Their frustration is understandable. Two years 

after Hurricane Katrina scattered residents to communities outside the Crescent 

City, most have yet to return home. But the protesters’ goal of getting the displaced 

back into their old units is wrong. While the historical significance of those structures is undeniable, so is their history of being forlorn concentrations of poverty. 

To tour the barracks-style apartment complexes of New Orleans is to see the best 

and worst of public housing. Because most of them were built in the 1940s, a walk 

into one of their cramped units is a walk back in time. For instance, residents can’t 

run water in the bathtub and the bathroom sink at the same time. Warmth in the 

winter is provided by space heaters. For the most part, the old projects are cut off 

from the flow of the city because the city’s streets don’t go through them. Now, if 

you go to the redeveloped Fischer and St. Thomas complexes, you’ll see the best in 

modern public housing. Warehousing of the poor and marginalizing them from the 

larger community are out. Modeled on HOPE VI developments, these are mixed-income neighborhoods of townhouses. The homes are spacious. The appliances are 

new. The sense of hopelessness that envelops Iberville, the one fully functioning oldstyle public housing project, is not present. 

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The U.S. Department of Housing and Urban Development wants to bring four 

other old public housing estates into the modern era. But a lawsuit by the Advancement Project, a Washington-based civil rights organization, has stopped HUD from 

doing so. The lawsuit accuses the agency of cleansing African Americans from New 

Orleans by keeping the four public housing projects shuttered. It demands a right 

of return for all New Orleans public housing residents, and it demands that those 

families go back to the units they fled on Aug. 29, 2005. Until the case goes to trial 

in November, those families will have to wait. This is unconscionable. Yes, they 

should return. But they should return to something much better than they left. 

At least one developer, Enterprise Community Partners, which has been chosen 

by HUD to redevelop the Lafitte project, has committed to providing a new public 

housing unit to every family that lived there before in what would become a mixedincome community. A bill sponsored by Sens. Christopher J. Dodd (D–Conn.) and 

Mary Landrieu (D–La.) would make what Enterprise is voluntarily doing the law. 

Donna Davis, 52, has lived in the projects since she was 9. The pride in her twostory townhouse in the new Fischer complex was plainly evident as she toured a 

visitor around. When asked what she would say to people afraid of HUD’s redevelopment plans, Ms. Davis looked to her own experience. ‘‘We lived [in Fischer] and 

stayed there,’’ she said. ‘‘Now it’s time for us to grow and open up . . . to see how 

good we can all live.’’ If the Dodd-Landrieu bill passes, the Advancement Project 

should drop its lawsuit. Returning public housing residents deserve to have Ms. 

Davis’s experience. 

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S. 1668 Gulf Coast Housing Recovery Act of 2007, Introduced 

by Senators Dodd and Landrieu, June 20, 2007 

SECTION-BY-SECTION

SEC. 1. TITLE 

Gulf Coast Housing Recovery Act of 2007 

SEC. 2. LIMITATION ON USE OF AUTHORIZED AMOUNTS. 

No funds authorized may be used for lobbying. 

TITLE I—COMMUNITY DEVELOPMENT BLOCK GRANTS 

SEC. 101. FLEXIBILITY OF FEDERAL FUNDS FOR ROAD HOME PROGRAM. 

Requires that FEMA transfer $1.17 billion of Hazard Mitigation 

Grant Program funds be transferred and allocated through the 

Road Home program, for mitigation activities. 

SEC. 102 HOUSEHOLD ASSISTANCE PROGRAMS FUNDED WITH CDBG 

DISASTER ASSISTANCE. 

Requires each state receiving supplemental CDBG funds to report on the uses of disaster CDBG funds, including details on programs established, applications submitted, funds disbursed, average assistance amounts, and comprehensive data on who is being 

served. Reports must be submitted quarterly to Congress and made 

publicly available on the Internet. 

SEC. 103 COMMUNITY DEVELOPMENT PILOT PROGRAM. 

Requires Louisiana to make available, from previously appropriated funds, $30 million for New Orleans, and $25 million for 

other parishes to use for redevelopment pilot programs. Under the 

pilot programs, local redevelopment authorities will acquire, bundle, and redevelop land. Redevelopment must be consistent with 

city and neighborhood revitalization plans, original owners of land 

will have first priority to purchase housing once developed, and 

25% of housing developed must be affordable to low-, very low- and 

extremely low-income households. 

SEC. 104. ROAD HOME PROGRAM SHORTFALL. 

Authorizes such sums as necessary for the Road Home program, 

provided that the state of Louisiana provides $1 billion for the program. 

SEC. 105. ELIMINATION OF PROHIBITION OF USE FOR MATCH REQUIREMENTS. 

Allows states to use supplemental CDBG funds as a match for 

other federal programs. 

Eliminates repetitive environmental reviews so long as one federal environmental review is conducted. 

SEC. 106. REIMBURSEMENT OF AMOUNTS USED FOR RENTAL HOUSING ASSISTANCE. 

Authorizes unused appropriated disaster funds to be used to reimburse cities or counties that used their own funds to house evacuees 

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TITLE II—PUBLIC HOUSING 

SEC. 201. SURVEY OF PUBLIC HOUSING RESIDENTS. 

Requires HUD to contract with an independent research entity 

to conduct a survey of people who resided in New Orleans public 

housing as of August 28, 2005, to determine which and how many 

households wish to return to redeveloped New Orleans public housing, how many want to return to a temporary public housing unit 

in New Orleans while redevelopment is occurring, how many want 

to receive voucher assistance in New Orleans, and how many want 

to receive housing vouchers elsewhere. The survey must be completed 90 days after enactment. 

SEC. 202. HOUSING FOR PREVIOUS RESIDENTS OF PUBLIC HOUSING. 

Requires that within 90 days of enactment, the Housing Authority of New Orleans (HANO) make available the greater of 3000 

public housing units, or the number of households who indicate in 

the survey that they want to return to public housing. 

In providing housing units, the housing authority must offer options of available units and must provide relocation assistance to 

residents wishing to return. 

SEC. 203. REPLACEMENT OF PUBLIC HOUSING DWELLING UNITS. 

HANO may only demolish public housing pursuant to if there is 

a plan approved by HUD which ensures that there is resident 

input, a public hearing is conducted, resident services are provided, 

and replacement units will be made available. 

Any unit which will not reopen and was occupied on August 28, 

2005 must be replaced with another affordable unit—public housing, other affordable unit, or a voucher attached to a hard unit 

(project-based vouchers). Any unit which will not reopen and was 

vacant on August 28, 2005 must be replaced with either an affordable unit or a housing voucher. 

SEC. 204. RESIDENT SUPPORT SERVICES. 

Where HANO is providing housing vouchers as replacement 

housing, it must: (1) provide mobility counseling; (2) conduct landlord outreach; and (3) work with developers to project-base assistance where possible. 

Every 6 months, HANO must report to Congress on where replacement units are located, including census tract data on poverty, 

rent burden data and demographic data. 

SEC. 205. PUBLIC HOUSING IN KATRINA AND RITA DISASTER AREAS. 

For the 2 years after enactment, a public housing agency (PHA) 

in disaster areas may only demolish or dispose of public housing 

if there is a plan approved by HUD which ensures that there is 

resident input, a public hearing is conducted, resident services are 

provided, and replacement units will be made available. 

Any unit which will not reopen and was occupied on August 28, 

2005 must be replaced with another affordable unit—public housing, other affordable unit, or a voucher attached to a hard unit 

(project-based vouchers). Any unit which will not reopen and was 

vacant on August 28, 2005 must be replaced with either an affordable unit or a housing voucher. 

A PHA must use its best efforts to locate tenants displaced and 

provide those tenants with replacement units. 

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SEC. 206. REPORTS ON PROPOSED CONVERSION OF PUBLIC HOUSING 

UNITS. 

Within 15 days of enactment, HUD must submit to Congress a 

report on any plans it has to transfer ownership of public housing. 

SEC. 207. AUTHORIZATION OF APPROPRIATIONS FOR REPAIR AND REHABILITATION FOR KATRINA AND RITA DISASTER AREAS. 

Authorizes such sums as are necessary to repair, rehabilitate, redevelop and replace public housing, as well as to provide relocation 

assistance and supportive services. 

SEC. 208. EXISTING PUBLIC HOUSING REDEVELOPMENT. 

Clarifies that any agreement to demolish or dispose of public 

housing entered into prior to enactment can go forward so long as 

replacement housing is provided. 

SEC. 209. REPORTS ON COMPLIANCE. 

Within 30 days of enactment, and each quarter thereafter, HUD 

must submit a detailed report to Congress on compliance with this 

title. 

SEC. 210. INDEPENDENT ADMINISTRATION OF HOUSING AUTHORITY 

OF NEW ORLEANS. 

Requires HUD to petition for judicial receivership of HANO within 30- days of enactment. Any receiver must comply with this Act. 

SEC. 211. DEFINITIONS. 

TITLE III—DISASTER VOUCHER PROGRAM AND PROJECT-BASED

ASSISTANCE

SEC. 301. DISASTER VOUCHER PROGRAM. 

Authorizes such sums as are necessary to provide disaster vouchers for formerly HUD-assisted households through June 30, 2008. 

Prior to October 31, 2007, HUD must work with FEMA and PHAs 

to identify households eligible for disaster housing vouchers. 

After June 30, 2008 disaster voucher holders who have not received tenant replacement vouchers shall receive Section 8 housing 

vouchers. Any assistance is temporary and only continues so long 

as the receiving family is income eligible. 

SEC. 302. TENANT REPLACEMENT VOUCHER FOR ALL LOST UNITS. 

Authorizes such sums as are necessary to replace all public and 

assisted housing which will not be replaced with replacement housing vouchers so there is no net loss of affordable housing. Requires 

HUD to issue replacement vouchers for any HUD-assisted housing 

not replaced by January 1, 2010. 

SEC. 303. VOUCHER ASSISTANCE FOR HOUSEHOLDS RECEIVING FEMA 

ASSISTANCE. 

Requires FEMA to transfer administration and funding for rental 

assistance for evacuees to HUD beginning January 1, 2008. Recipients of assistance will be required to pay 30 percent of income as 

required with other HUD assistance, with a minimum rent of $100. 

Authorizes funds to provide rental assistance for households still 

living in FEMA trailers. Subject to funds, HUD is required to offer 

housing assistance to families in trailers. 

Any assistance provided is temporary and only continues so long 

as the household is income eligible. 

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SEC. 304. VOUCHER ASSISTANCE FOR SUPPORTIVE HOUSING. 

Authorizes appropriations for 5,500 supportive housing projectbased vouchers from the homeless, seniors and people with disabilities. 

SEC. 305. PROJECT BASING OF VOUCHERS. 

Allows housing agencies in affected areas to project-base more 

that 20 percent of their vouchers so long as the vouchers are used 

in mixed-income communities, are in low-poverty neighborhoods or 

neighborhoods undergoing revitalization. 

SEC. 306. PRESERVATION OF PROJECT BASED HOUSING ASSISTANCE 

PAYMENTS CONTRACTS FOR DWELLING UNITS DAMAGED 

OR DESTROYED. 

Clarifies that HUD shall not terminate housing assistance payments contracts for multifamily housing due to destruction or damage as a result of the 2005 storms. 

Requires HUD to allow project-based assistance to be transferred 

from damaged/destroyed properties to other properties to preserve 

affordable housing. 

SEC. 307. GAO STUDY OF WRONGFUL OR ERRONEOUS TERMINATION 

OF FEDERAL RENTAL HOUSING ASSISTANCE. 

Requires GAO to conduct a study of households that received 

FEMA rental assistance to determine if assistance was wrongfully 

or erroneously terminated and to submit a report no later than 

January 1, 2008. 

TITLE IV—DAMAGES ARISING FROM FEMA ACTIONS

SEC. 401. 

Authorizes appropriations to reimburse landlords who contracted 

with FEMA to provide rental assistance to evacuees where those 

contracts were abrogated by FEMA. 

TITLE V—FHA HOUSING

SEC. 501. TREATMENT OF NONCONVEYABLE PROPERTIES. 

Requires HUD to pay FHA insurance claims and take conveyance of damaged or destroyed properties notwithstanding normal 

requirements that the properties be habitable. Amounts paid out 

must be provided in advance through appropriations. 

SEC. 502. FHA SINGLE-FAMILY INSURANCE. 

Requires that FHA use pre-hurricane creditworthiness in determining eligibility of an individual for FHA insurance. 

SEC. 503. FHA-NEW ORLEANS HOMEOWNERSHIP OPPORTUNITIES INITIATIVE. 

Establishes an FHA-New Orleans Homeownership Opportunities 

Initiative to transfer homes held by HUD to the New Orleans Redevelopment Authority (NORA). Homes within HUD’s control— 

which have been abandoned, are vacant or have been foreclosed 

upon—will be given to NORA to use for redevelopment activities. 

NORA must make available for low-income homebuyers the number of homes conveyed to it by HUD (not necessarily in the same 

locations). NORA must sell homes to low-income households who 

agree to use the home as their primary residence for at least 5 

years, or to sell only to low-income buyers within 5 years. NORA 

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must set sales prices at affordable levels and any profits above redevelopment costs will go to HUD. NORA must provide for counseling for families; must inspect homes prior to sale; and must establish procedures to recapture funds where homes are not sold to 

low-income families, prices exceed development costs, and where 

homes are not used as primary residences for 5 years. 

The pilot terminates after 5 years, and at 3 years and 5 years, 

NORA must submit a report to Congress on the implementation, 

status and execution of the pilot. 

TITLE VI—FAIR HOUSING ENFORCEMENT

SEC. 601. FAIR HOUSING INITIATIVES PROGRAM. 

Authorizes at least $5 million in fiscal years 2008 and 2009 for 

fair housing activities in affected areas. 

TITLE VII—IMPROVED DISTRIBUTION OF FEDERAL HURRICANE

HOUSING FUNDS FOR HURRICANE RELIEF

SEC. 701. GAO STUDY OF IMPROVED DISTRIBUTION OF FEDERAL 

HOUSING FUNDS FOR HURRICANE RELIEF. 

Requires GAO to conduct a study on the most effective and efficient way to distribute housing assistance after hurricanes and 

other disasters, and to submit a report to Congress within 6 

months of enactment. 

TITLE VIII—COMMENDING AMERICANS FOR THEIR REBUILDING

EFFORTS

SEC. 801. COMMENDING AMERICANS. 

Congress finds that many Americans, individuals, faith-based organizations, non-profits and community organizations provided 

needed relief aid after the hurricanes and assistance in rebuilding 

efforts and commends Americans for this assistance. 

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