[House Hearing, 116 Congress]
[From the U.S. Government Publishing Office]
ROAD TO RECOVERY: PUERTO RICO AND THE
U.S. VIRGIN ISLANDS AFTER HURRICANES IRMA
AND MARIA
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HEARING
BEFORE THE
SUBCOMMITTEE ON
EMERGENCY PREPAREDNESS,
RESPONSE, AND RECOVERY
OF THE
COMMITTEE ON HOMELAND SECURITY
HOUSE OF REPRESENTATIVES
ONE HUNDRED SIXTEENTH CONGRESS
FIRST SESSION
__________
JULY 11, 2019
__________
Serial No. 116-32
__________
Printed for the use of the Committee on Homeland Security
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Available via the World Wide Web: http://www.govinfo.gov
__________
U.S. GOVERNMENT PUBLISHING OFFICE
39-400 PDF WASHINGTON : 2020
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COMMITTEE ON HOMELAND SECURITY
Bennie G. Thompson, Mississippi, Chairman
Sheila Jackson Lee, Texas Mike Rogers, Alabama
James R. Langevin, Rhode Island Peter T. King, New York
Cedric L. Richmond, Louisiana Michael T. McCaul, Texas
Donald M. Payne, Jr., New Jersey John Katko, New York
Kathleen M. Rice, New York John Ratcliffe, Texas
J. Luis Correa, California Mark Walker, North Carolina
Xochitl Torres Small, New Mexico Clay Higgins, Louisiana
Max Rose, New York Debbie Lesko, Arizona
Lauren Underwood, Illinois Mark Green, Tennessee
Elissa Slotkin, Michigan Van Taylor, Texas
Emanuel Cleaver, Missouri John Joyce, Pennsylvania
Al Green, Texas Dan Crenshaw, Texas
Yvette D. Clarke, New York Michael Guest, Mississippi
Dina Titus, Nevada
Bonnie Watson Coleman, New Jersey
Nanette Diaz Barragan, California
Val Butler Demings, Florida
Hope Goins, Staff Director
Chris Vieson, Minority Staff Director
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SUBCOMMITTEE ON EMERGENCY PREPAREDNESS, RESPONSE, AND RECOVERY
Donald M. Payne Jr., New Jersey, Chairman
Cedric Richmond, Louisiana Peter T. King, New York, Ranking
Max Rose, New York Member
Lauren Underwood, Illinois John Joyce, Pennsylvania
Al Green, Texas Dan Crenshaw, Texas
Yvette D. Clarke, New York Michael Guest, Mississippi
Bennie G. Thompson, Mississippi (ex Mike Rogers, Alabama (ex officio)
officio)
Lauren McClain, Subcommittee Staff Director
Diana Bergwin, Minority Subcommittee Staff Director
C O N T E N T S
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Page
Statements
The Honorable Donald M. Payne Jr., a Representative in Congress
From the State of New Jersey, and Chairman, Subcommittee on
Emergency Preparedness, Response, and Recovery:
Oral Statement................................................. 1
Prepared Statement............................................. 3
The Honorable Peter T. King, a Representative in Congress From
the State of New York, and Ranking Member, Subcommittee on
Emergency Preparedness, Response, and Recovery:
Oral Statement................................................. 3
Prepared Statement............................................. 4
The Honorable Bennie G. Thompson, a Representative in Congress
From the State of Mississippi, and Chairman, Committee on
Homeland Security:
Oral Statement................................................. 5
Prepared Statement............................................. 6
Witnesses
Mr. Omar J. Marrero, Executive Director, Central Office for
Recovery, Reconstruction, and Resilience (COR3):
Oral Statement................................................. 6
Prepared Statement............................................. 8
Ms. Adrienne L. Williams-Octalien, Director, Office of Disaster
Recovery, V.I. Public Finance Authority:
Oral Statement................................................. 12
Prepared Statement............................................. 14
Mr. Chris P. Currie, Director, Homeland Security and Justice,
U.S. Government Accountability Office:
Oral Statement................................................. 17
Prepared Statement............................................. 18
For the Record
The Honorable Peter T. King, a Representative in Congress From
the State of New York, and Ranking Member, Subcommittee on
Emergency Preparedness, Response, and Recovery:
Statement of the American Maritime Partnership................. 39
The Honorable Dan Crenshaw, a Representative in Congress From the
State of Texas:
Article, Politico.............................................. 42
The Honorable Donald M. Payne Jr., a Representative in Congress
From the State of New Jersey, and Chairman, Subcommittee on
Emergency Preparedness, Response, and Recovery:
Statement of Honorable Stacey Plaskett......................... 51
Appendix
Question From Chairman Bennie G. Thompson for Chris P. Currie.... 55
ROAD TO RECOVERY: PUERTO RICO AND THE U.S. VIRGIN ISLANDS AFTER
HURRICANES IRMA AND MARIA
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Thursday, July 11, 2019
U.S. House of Representatives,
Committee on Homeland Security,
Subcommittee on Emergency Preparedness,
Response, and Recovery,
Washington, DC.
The subcommittee met, pursuant to notice, at 10:07 a.m., in
room 310, Cannon House Office Building, Hon. Donald M. Payne,
Jr. (Chairman of the subcommittee) presiding.
Present: Representatives Payne, Green, Clarke, Thompson,
King, Joyce, and Crenshaw.
Mr. Payne. The Subcommittee on Emergency Preparedness,
Response, and Recovery will come to order.
The subcommittee is meeting today to receive testimony on
the ``Road to Recovery: Puerto Rico and the U.S. Virgin Islands
after Hurricanes Irma and Maria.''
Without objection, the Chair may declare the subcommittee
in recess at any point.
Without objection, Members not sitting on the subcommittee
will be permitted to participate in today's hearing.
I now recognize myself for an opening statement.
Good morning. The subcommittee is meeting to discuss the
status of the disaster recovery operations in Puerto Rico and
the U.S. Virgin Islands following Hurricanes Irma and Maria.
First, I want to thank our witnesses from Puerto Rico and
the U.S. Virgin Islands and the Government Accountability
Office for being here today. Your testimony will help the
subcommittee understand how much work is left to be done in
Puerto Rico and the U.S. Virgin Islands after the devastating
2017 storms.
As everyone can see, we have a critical witness absent from
today's hearing. FEMA is a no-show. FEMA was notified about
this hearing nearly 2 months ago but would not confirm a
witness. A month ago, I pressed the issue with the Acting
Administrator Gaynor as he testified and said he would work to
provide a witness for today's hearing. Yet we are here today
without a FEMA witness. The agency has a personnel shortage,
but you would think it would be able to provide a witness for a
hearing on some of the most devastating storms our country
experienced in modern history. If that empty chair isn't a
perfect metaphor for the administration's response to
Hurricanes Irma and Maria, I don't know what is.
Unfortunately, FEMA's absence today is just the latest
example of the administration's apathy toward Hurricanes Irma
and Maria recovery and further underscores the need for this
committee to provide robust oversight.
Turning to the subject matter at hand, the unusually active
2017 hurricane season simultaneously produced intense storms in
Texas, Florida, and devastated Puerto Rico and the U.S. Virgin
Islands. From the damage caused by these storms, the U.S.
Virgin Islands is facing more than 11 billion--11 billion in
financial impact. The impact of Hurricane Maria alone left
Puerto Rico with a death toll of nearly 3,000, and recovery is
estimated at over a hundred billion. Before the storms hit,
Puerto Rico was dealing with a precarious financial situation,
a disaster that would have severely hampered the territory's
recovery efforts for damage at any level, let alone back-to-
back major hurricanes.
With the recovery being such a massive undertaking, I have
serious concerns about the blanket use of Public Assistance
Alternative Procedures in Puerto Rico being used to rebuild the
island. I find the pace that FEMA is administering this program
to be troubling. Nearly 2 years have passed, and permanent work
in Puerto Rico has yet to begin. That means American schools,
hospitals, roads, and other public places are still damaged
from the storms, and the time line for getting under way is
unknown. Let that sink in for a moment. I am also concerned
about the very real possibility that the recovery project cost
estimates will be underestimated, which would leave Puerto Rico
cash-strapped and on the hook for any of the overages.
While the U.S. Virgin Islands was not required to use
Public Assistance Alternative Procedures, the territory had
recently opted to use this program moving forward in their
recovery. Like Puerto Rico, the U.S. Virgin Islands has yet to
begin work on permanent projects. And, again, critical
community spaces are still sitting in the 2-year-old damage due
in part to FEMA's slow pace.
As such, I am interested to hear from our witnesses today
the challenges associated with the use of Public Assistance
Alternative Procedures to rebuild in Puerto Rico and the Virgin
Islands. The extraordinary nature of the 2017 disasters and
their impacts on our country can provide an opportunity to
learn, grow, and to make the Federal Government's disaster
response and recovery efforts better. For that, it is truly a
shame that FEMA has decided not to participate in this hearing.
On a personal note, as someone who dealt with the aftermath
of Hurricane Sandy, I cannot imagine how much more difficult
recovery would have been if FEMA had not refused to show up and
talk to the American public about the recovery. Despite FEMA
not being here today, I am heartened by the witnesses who did
come to discuss the incredibly important matter. Thank you
again for being here, and I look forward to our dialog.
[The statement of Chairman Payne follows:]
Statement of Chairman Donald M. Payne, Jr.
July 11, 2019
The subcommittee is meeting to discuss the status of disaster
recovery operations in Puerto Rico and the U.S. Virgin Islands
following Hurricanes Irma and Maria. First, I want to thank our
witnesses from Puerto Rico, the U.S. Virgin Islands, and the Government
Accountability Office for being here today. Your testimony will help
the subcommittee understand how much work is left to be done in Puerto
Rico and the U.S. Virgin Islands after the devastating 2017 storms. As
everyone can see, we have a critical witness absent from today's
hearing. FEMA is a ``no-show.'' FEMA was notified about this hearing
nearly 2 months ago but would not confirm a witness.
A month ago, when I pressed the issue, Acting Administrator Gaynor
testified he would work to provide a witness for today's hearing. Yet,
here we are today without a FEMA witness. The agency has a personnel
shortage, but you would think it would be able to provide a witness for
a hearing on some of the most devastating storms our country
experienced in modern history. If that empty chair isn't a perfect
metaphor for this administration's response to Hurricanes Irma and
Maria, I don't know what is. Unfortunately, FEMA's absence today is
just the latest example of the administration's apathy toward
Hurricanes Irma and Maria recovery and further underscores the need for
this committee to provide robust oversight.
Turning to the subject matter at hand, the unusually active 2017
hurricane season simultaneously produced intense storms in Texas and
Florida and devastated Puerto Rico and the U.S. Virgin Islands. From
the damage caused by these storms, the U.S. Virgin Islands is facing
more than $11 billion financial impact. The impact of Hurricane Maria
alone left Puerto Rico with a death toll of nearly 3,000 and recovery
is estimated over $100 billion. And before the storms hit, Puerto Rico
was dealing with a precarious financial situation, a disaster, that
would have severely hampered the territory's recovery efforts for
damage at any level, let alone back-to-back major hurricanes. With
recovery being such a massive undertaking, I have serious concerns
about the blanket use of Public Assistance Alternative Procedures in
Puerto Rico being used to rebuild the island. I find the pace that FEMA
is administering this program to be troubling. Nearly 2 years have
passed, and permanent work in Puerto Rico has yet to begin. That means
American schools, hospitals, roads, and other public places are still
damaged from the storms and the time line for work getting under way is
unknown. Let that sink in for a moment.
I am also concerned about the very real possibility that the
recovery project cost estimates will be underestimated, which would
leave cash-strapped Puerto Rico on the hook for the overages. While the
U.S. Virgin Islands was not required to use Public Assistance
Alternative Procedures, the territory has recently opted to use this
program moving forward in their recovery. Like Puerto Rico, the U.S.
Virgin Islands has yet to begin work on permanent projects, and again,
critical community spaces are still sitting in 2-year-old damage due in
part to FEMA's slow pace. As such, I am interested to hear from our
witnesses today the challenges associated with the use of Public
Assistance Alternative Procedures to rebuild in Puerto Rico and the
U.S. Virgin Islands. The extraordinary nature of the 2017 disasters and
their impacts on our country provide an opportunity to learn, grow, and
to make the Federal Government's disaster response and recovery efforts
better. For that, it is truly a shame that FEMA has decided not to
participate in this hearing. On a personal note, as someone who dealt
with the aftermath of Hurricane Sandy, I cannot imagine how much more
difficult recovery would have been if FEMA had refused to show up to
talk to the American public about our recovery. Despite FEMA not being
here today, I am heartened by the witnesses who did come to discuss
this incredibly important matter.
Mr. Payne. With that, I will now recognize the Ranking
Member of the subcommittee, the gentleman from New York, Mr.
King, for an opening statement.
Mr. King. Thank you, Mr. Chairman.
I would like to also welcome today's witnesses and thank
them for their time. After being here, it is not always easy.
So I appreciate you being here. Thank you.
Today marks the fifth time the subcommittee or the full
committee has met to discuss recovery efforts in Puerto Rico
and the U.S. Virgin Islands. In March, we heard testimony on
how the Federal Government could improve its response to
disasters. In April, we assessed how climate change impacted
National security. In May, we reviewed FEMA's contracting and
the lessons learned from Hurricanes Irma and Maria. Last month,
we looked at FEMA's readiness for future disasters. We have
heard from officials in Puerto Rico and the U.S. Virgin Islands
on the state of recovery in these territories. We have received
reports from the Government Accountability Office, from the IG.
FEMA has testified before our subcommittee on the challenges it
has faced in responding to these catastrophic storms. It
submitted shortcomings and made clear what they need to
complete the mission, and yet we have convened another hearing.
While recovery in Puerto Rico and the U.S. Virgin Islands
is incredibly important, it is important that we move past
discussion and act.
I recently cosigned onto Chairman Thompson's house
companion to Senator Rubio's FACE Act which codifies the GAO
recommendations with regards to FEMA contracting. I agree with
those recommendations and support improving FEMA's contracting
practices. This bill, however, was not referred to this
committee which illustrates our limited jurisdiction in this
sphere.
I support continued oversight of disaster recovery,
including implementation of the Disaster Recovery Reform Act
which was signed into law last year and emphasizes investment
in mitigation, reducing risk, and increasing a State or
territory's capacity to manage disaster recovery. I also
support strong oversight of FEMA Homeland Security Grant
Programs. Federal funds through programs such as the State
Homeland Security Grant Program, Urban Areas Security
Initiative, and Port Security Grant enable local communities to
support their first responder work force and to harden their
defenses against potential attacks.
In New York City, Federal grants have allowed the
Department of Emergency Management, the NYPD, and FDNY to
conduct training and exercises, provide public education and
outreach, and develop response protocols and safety initiatives
to significantly increase security preparedness.
Again, I want to express my appreciation to the witnesses
for being here today.
Mr. Chairman, I yield back.
[The statement of Ranking Member King follows:]
Statement of Ranking Member Peter T. King
July 11, 2019
Thank you, Mr. Chairman. I'd like to welcome today's witnesses and
thank them for their time.
Today marks the fifth time this subcommittee or the full committee
has met to discuss recovery efforts in Puerto Rico and the U.S. Virgin
Islands. In March, we heard testimony on how the Federal Government
could improve its response to disasters. In April, we assessed how
climate change impacted National security. In May, we reviewed Federal
Emergency Management Agency contracting and the lessons learned from
Hurricanes Irma and Maria. Last month, we looked at FEMA's readiness
for future disasters.
We have heard from officials from Puerto Rico and the U.S. Virgin
Islands on the state of recovery in each territory. We have reviewed
reports from the Government Accountability Office and from the Office
of the Inspector General. FEMA has testified before our subcommittee on
the challenges they have faced in responding to these catastrophic
storms. They've admitted their shortcomings and made clear what they
need to complete their mission. And yet we have convened another
hearing.
While the recovery of Puerto Rico and the U.S. Virgin Islands is
incredibly important, we must move past discussion and we must act. I
recently cosigned on to Chairman Thompson's House companion to Senator
Rubio's FACE Act, which codifies the recommendations of GAO with
regards to FEMA contracting. I agree with GAO's recommendations and
support improving FEMA's contracting practices.
This bill, however, was not referred to this committee, which
illustrates our limited jurisdiction in this sphere.
I support continued oversight of disaster recovery including
implementation of the Disaster Recovery Reform Act, which was signed
into law last year, and emphasizes investment in mitigation, reducing
risk, and increasing a State or territory's capacity to manage disaster
recovery.
I also support strong oversight of FEMA Homeland Security Grants
programs. Federal funds through programs such as the State Homeland
Security Grant Program, Urban Area Security Initiative, and Port
Security Grant enable local communities to support their first
responder workforce and to harden their defenses against potential
attacks.
In New York City, Federal grants have allowed the Department of
Emergency Management, the NYPD, and the FDNY to conduct training and
exercises, provide public education and outreach, and develop response
protocols, and safety initiatives to significantly increase security
preparedness.
I want to again express my appreciation for our witnesses being
here today. Mr. Chairman, I yield back.
Mr. Payne. Thank you, sir.
With that, I will recognize the Chairman of the full
committee, the gentleman from Mississippi, Mr. Bennie Thompson,
for an opening statement.
Mr. Thompson. Thank you very much, Mr. Chair, and Ranking
Member for holding this hearing.
However, I do want to share your dismay about FEMA's
decision not to send a witness to today's hearing. So much of
what I have heard and seen in my visit to Puerto Rico,
especially, in many instances FEMA has been missing in action.
So their absence today is dually noted.
FEMA's refusal undermines the work of this committee, which
is exercising its oversight responsibilities to ensure Federal
recovery assistance is being allocated appropriately and tax
dollars are being spent wisely. It is disrespectful to our
witnesses from Puerto Rico and the U.S. Virgin Islands who have
traveled here today to inform Congress about the recovery
challenges they still face at home. I might add these are
American citizens; they deserve no less. It is unfortunate that
they are not here to listen to testimony from our Government
Accountability Office witness, which has done yeoman's work
reviewing FEMA's response to 2017 hurricane season in order to
improve the agency's work on this and future disasters.
I am particularly disappointed in FEMA's refusal to send a
representative after Acting Administrator Peter Gaynor
testified at a previous hearing that he would see to it that
the agency provided a witness for this hearing. Now we have an
empty chair where someone from FEMA should be sitting.
Nonetheless, I appreciate Chairman Payne and Ranking Member
King holding today's hearing on Puerto Rico and the U.S. Virgin
Islands' recovery from the 2017 hurricane season. I might add
some of us have been put on notice that Mississippi and
Louisiana is facing not as big a situation as Puerto Rico and
the Virgin Islands, but, obviously, we are on notice, too.
The challenge for us is whether or not the response to
Mississippi, my home State, and Louisiana will be comparable to
Puerto Rico and Virgin Islands, or will it be better? But,
nonetheless, we are all Americans. There shouldn't be Puerto
Rico and Virgin Islands response. There should be an American
response, and I look forward to the information we glean from
this hearing.
I yield back.
[The statement of Chairman Thompson follows:]
Statement of Chairman Bennie G. Thompson
July 11, 2019
I share Chairman Payne's dismay about FEMA's decision not to send a
witness to today's hearing. Their refusal undermines the work of this
committee, which is exercising its oversight responsibilities to ensure
Federal recovery assistance is being allocated appropriately and
taxpayer dollars are being spent wisely.
It is disrespectful to our witnesses from Puerto Rico and the U.S.
Virgin Islands who traveled to be here today to inform Congress about
the recovery challenges they still face at home. And it is unfortunate
they are not here to listen to testimony from our Government
Accountability Office witness, which has done yeoman's work reviewing
FEMA's response to the 2017 hurricane season in order to improve the
agency's work on this and future disasters.
I am particularly disappointed in FEMA's refusal to send a
representative after Acting Administrator Peter Gaynor testified at a
previous hearing that he would see to it that his agency provided a
witness for this hearing. Now we have an empty chair where someone from
FEMA should be. Nonetheless, I appreciate Chairman Payne and Ranking
Member King holding today's hearing on Puerto Rico and the U.S. Virgin
Islands' recovery from the 2017 hurricane season.
This hearing continues the committee's longstanding oversight work
on the Federal response to major disasters, and it comes at a critical
juncture in recovery for Puerto Rico and the USVI.
Thanks to the witnesses present today for taking time to lend us
your perspectives. I hope you will share your stories and offer
insights into what Congress can do to help ensure a speedy and
efficient recovery from Hurricanes Irma and Maria. I look forward to a
good discussion today on that topic and to future oversight of FEMA's
recovery efforts.
Mr. Payne. I thank the gentleman.
Other Members of the committee are reminded that, under the
committee's rules, opening statements may be submitted for the
record.
I welcome our panel of witnesses. Our first witness is Mr.
Omar J. Marrero, the executive director of the Central Office
for Recovery, Reconstruction, and Resilience, or COR3, in
Puerto Rico.
Our second witness is Ms. Adrienne L. Williams-Octalien,
Octalien--I am sorry--and she is the director of the Office of
Disaster Recovery in the U.S. Virgin Islands.
Our third and the final witness is Chris P. Currie, the
director of homeland security and justice at the Government
Accountability Office.
Without objection, the witnesses' full statements will be
inserted into the record.
I now ask each witness to summarize his or her statement
for 5 minutes, beginning with Mr. Marrero.
STATEMENT OF OMAR J. MARRERO, EXECUTIVE DIRECTOR, CENTRAL
OFFICE FOR RECOVERY, RECONSTRUCTION, AND RESILIENCE (COR3)
Mr. Marrero. Thank you, sir.
Good morning, Chairman Payne, Ranking Member King, and
Members of the committee, particularly Mr. Thompson, Chairman
of the full committee.
Thank you for the opportunity to be here today as we
discuss the status of recovery in Puerto Rico caused by
Hurricanes Irma and Maria. On behalf of the Governor, Ricardo
Rossello, it is my honor and privilege to here today.
As Members of this committee have seen first-hand through
their visits to Puerto Rico, Hurricanes Irma and Maria were
catastrophic. On September 6, 2017, Hurricane Irma skirted the
northern coast of Puerto Rico as a Category 5 storm. While
response teams were still mobilizing, Hurricane Maria is
slamming to Puerto Rico as a Category 4 just 2 weeks later.
These hurricanes cost over $100 billion in damages,
representing the worst natural disaster our island has ever
seen.
As a survivor, I saw first-hand the destruction of our
communities: Homes, infrastructure, and power grid. Nearly
every American living on the island, including my family,
friends, neighbors, our people were faced with a humanitarian
crisis that defied anyone's expectations. Even now, nearly 2
years later, over 300,000 children attend schools which have
not been repaired, and many of them have to still go to home to
houses with blue tarp roof. It has been life-changing for
everyone on the island.
There is no question that decades of underinvestment and
lack of adequate maintenance contributed greatly to the great
deal of damage to the island. Indeed, with respect to our most
critical infrastructure, the decision by this body to allow a
one-time rebuild without regard to preexisting conditions will
go a long way toward setting Puerto Rico up to be not only more
resilient but also economically and fiscally responsible.
Let me assure you that the taxpayer investment in the
island will not be wasted. Governor Rossello and his entire
administration, we are committed to make sure that we are wise
and transparent as to the use of the Federal funding existing
for the disaster with the goal of restoring our ability to
contribute to the economic success of our Nation.
This hurricane taught us that the lives, safety, and
security of our residents depend as much on our local capacity
to respond to immediate emergency as it does on the capacity to
muster a proportionate and timely response from the Federal
Government.
We continue to build and develop these capabilities in
coordination with FEMA, HUD, EPA, DOE, HHS, and many other
Federal agencies. Twenty-two months into our recovery, we are
clearly in a world that climate change is making natural
disasters more frequent and more damaging, further underscoring
the need to build back in a more resilient way. Puerto Rico
remains especially vulnerable to the impact of climate-change-
enhanced disasters due to our geographical composition, as it
does to the USVI as well. Unfortunately, this unique
disadvantage has been exacerbated by a series of Federal agency
decisions slowing our post-disaster recovery compared to those
of other jurisdictions State-side.
Principal among these inconsistencies are FEMA's guidance
with respect to the implementation of the section 428 for
permanent work, a lack of timely decision making, and a better
recent change in the way FEMA will perform its role in the
management of recovery funds.
These distinctions in the Public Assistance process
implementation are causing additional delays, reducing Puerto
Rico's ability to lead the recovery and, more importantly,
impeding our ability to meet the FEMA's October deadline for
the completion and agreement of the close estimates.
A failure to agree on the definition of industry standards,
cost factors, and a refusal to allow Puerto Rico to use its own
licensed engineers previously authorized in New York and New
Jersey, and a host of other less significant obstacles
perpetrate the notion that we are neither trusted nor permitted
to lead our own recovery.
FEMA always says that recovery is a Federally-supported,
State-managed, and locally-executed process. Unfortunately,
that has not been our experience. The island depends on FEMA
and the good will of this hallowed body while we remain an
independent territory. Despite every effort of Congress to help
us recover, Puerto Rico has only had approximately 122 projects
approved of the 1,475 PWs, or project worksheets, submitted in
the last 22 months. In contrast, in the same time frame, over
13,000 projects were approved for Louisiana and Mississippi in
the wake of Hurricane Katrina.
Our goal is to re-imagine, revitalize, and rebuild Puerto
Rico so it can develop its full capacity for the benefit of the
3.5 million of U.S. citizens who live there and the 5 point--
million Puerto Ricans who live in the mainland while we want
them go back to Puerto Rico as well.
While we have a long road ahead of us, as we say in Puerto
Rico, ``Puerto Rico se levanta,'' ``and Puerto Rico will
rise.''
Thank you. I look forward to your questions, as well as to
the further collaborations that the Federal Government and the
State government of Puerto Rico will continue to do.
Thank you, sir.
[The prepared statement of Mr. Marrero follows:]
Prepared Statement of Omar Marrero
July 11, 2019
Chairman Payne, Ranking Member King, and Members of the committee:
Thank you for the opportunity to appear before you today on behalf of
the 3.2 million American citizens of Puerto Rico to discuss our
recovery from Hurricanes Irma and Maria. In the 22 months following the
devastation of these two Hurricanes, we have made significant progress
toward building back Puerto Rico. This progress is, in part, the result
of the tremendous and often bipartisan support we have received from
this committee and Congress more broadly; as well as the support we
have received from the Federal Emergency Management Agency (FEMA) and
other Federal agencies.
I would like to take this opportunity to express our appreciation
for passage of the Additional Supplemental Appropriations for Disaster
Relief Act, H.R. 2157, Pub. L. 116-20, which included critical
Nutrition Assistance Program (NAP) dollars as well as legislative fixes
to the Bipartisan Budget Act (BBA) of 2018, Pub. L. 115-123, which will
enable a more thorough recovery for Puerto Rico. Although much remains
to be done, this support will help speed recovery a great deal.
As Members of this committee have seen through their visits to
Puerto Rico--Hurricanes Irma and Maria wrought catastrophic damage to
Puerto Rico in September 2017. Hurricane Irma skirted the northern
coast of Puerto Rico from September 6, 2017-September 7, 2017 as a
Category 5 storm, causing significant flooding and regional power and
water outages. Only 13 days later, on September 20, 2017, Hurricane
Maria slammed into Puerto Rico as a Category 4 storm. Hurricane Maria
caused all power to be lost across the island as Puerto Rico descended
into the longest blackout in U.S. history--328 days until the entire
island regained power. The powerful winds, storm surge, and localized
flooding of Hurricane Maria led to the significant damage or
destruction of more than 472,000 housing units across the island; and,
as we were unable to provide shelter to all of the victims of the
Hurricanes, tens of thousands of Puerto Rican residents were forced to
flee to the continental United States to seek reprieve.\1\ The storms
caused a humanitarian crisis for those who remained in Puerto Rico--
particularly surrounding public health and safety. Nearly all water and
wastewater treatment plants were rendered inoperable and millions of
gallons of untreated waste were leaked into the environment.\2\
Hospitals and primary care facilities were forced to close due to lack
of power, resources, or clean and potable water. Not only were food,
and medicines scarce, but a lack of power meant a total breakdown of
wireless networks and cellular signals; what food and medicine remained
could only be purchased with cash. For the 1.3 million Puerto Rican NAP
recipients, this meant that they could not purchase food or other
supplies.\3\ For context--of the 1.3 million Puerto Rican NAP
recipients, 45 percent include households with children younger than
18, and nearly 330,000 elderly people.\4\
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\1\ Ricardo Rossello, Governor of Puerto Rico, ``Build Back Better
Puerto Rico'', November 13, 2017; https://www.governor.ny.gov/sites/
governor.ny.gov/files/atoms/files/Build_Back_Better_PR.pdf.
\2\ Ricardo Rossello, Governor of Puerto Rico, ``Build Back Better
Puerto Rico'', November 13, 2017; https://www.governor.ny.gov/sites/
governor.ny.gov/files/atoms/files/Build_Back_Better_PR.pdf.
\3\ Washington Post, ``More than 670,000 Puerto Rico residents have
received cuts to food'', June 24, 2019; https://www.washingtonpost.com/
us-policy/2019/03/08/puerto-rico-starts-cutting-food-stamp-benefits-
used-by-more-than-million-people-amid-congressional-impasse/?noredir-
ect=on&utm_term=.98e2e5d0567f.
\4\ Washington Post, ``More than 670,000 Puerto Rico residents have
received cuts to food'', June 24, 2019; https://www.washingtonpost.com/
us-policy/2019/03/08/puerto-rico-starts-cutting-food-stamp-benefits-
used-by-more-than-million-people-amid-congressional-impasse/?noredir-
ect=on&utm_term=.98e2e5d0567f.
---------------------------------------------------------------------------
Despite all of this, Governor Ricardo Rossello has chosen to view
our recovery from the seemingly insurmountable devastation at the time
of the storms, as a moonshot opportunity for bold transformation. We
can--and we will--build Puerto Rico back better. We cannot only prepare
for the disasters of tomorrow and mitigate against this level of
devastation and tragedy from happening again; but also unlock the
potential of Puerto Rico for the 3.2 million U.S. citizens who call our
island, ``La Isla del Encanto'' or ``the Island of Enchantment'' home.
The Governor and his administration are dedicating every waking moment
to the progress and success of our recovery in Puerto Rico. It is not
an overstatement to say that this body has the power to open the doors
needed for Puerto Rico to achieve a future that is strong, resilient,
and prosperous.
As we look to the future--we recognize that the island's past
remains a weight on our recovery. Long before the 2017 Hurricanes,
Puerto Rico was reeling from decades of fiscal mismanagement, economic
distress, and demographic challenges, all of which resulted in our man-
made disasters--our fiscal and economic crises. Governor Rossello
campaigned, and was elected on, a commitment to address those
challenges, including over $72 billion in public debts and $50 billion
in unfunded pension liabilities forcing the island into bankruptcy. As
we build back Puerto Rico, we cannot forget where our island was in
2017, on the eve of Hurricanes Irma and Maria.
In the aftermath of the Hurricanes, Governor Rossello initially
laid out his vision for our recovery in the Build Back Better document,
which was developed with the support and assistance of the Governor's
Office for Storm Recovery of State of New York, and later ratified it
in our recovery plan required by Congress: ``Transformation and
Innovation in the Wake of Devastation: Economic and Disaster Recovery
Plan for Puerto Rico.''\5\ This plan envisions a future for Puerto Rico
beyond recovery--we see a future Puerto Rico that is resilient,
economically vibrant, and the economic hub for the United States'
investment in Latin America. Puerto Rico will be competitive within the
global economy and expand its contribution to the United States.
Government reform, integrated planning, digitization, and public
engagement are all keys to Puerto Rico maximizing investment in
recovery, renewal, and future growth. Toward this end, the Governor's
Recovery Plan identifies 276 Courses of Action (COAs) in support of
Puerto Rico's recovery and reconstruction.
---------------------------------------------------------------------------
\5\ Central Office for Recovery, Reconstruction and Resiliency,
``Transformation and Innovation in the Wake of Devastation: Economic
and Disaster Recovery Plan for Puerto Rico,'' August 8, 2018, https://
cor3.pr/assets/documents/pr-transformation-innovation-plan-
congressional-submission-080818.pdf.
---------------------------------------------------------------------------
The COAs are grouped into Capital Investments and Strategic
Initiatives. The Capital Investments focus on the following
foundational areas: Energy; Communication/Information Technology;
Water; Transportation; Housing; Public Buildings; Education; Health and
Social Services; and, Natural and Cultural Resources. The Strategic
Initiatives are designed to move beyond infrastructure recovery and
focus on the following areas of long-term social and economic growth:
Enhancing the Ocean and Visitor Economies; Modernization of Emergency
Services; Agricultural Transformation; Digital Transformation;
Transition to a 21st Century Workforce; Entrepreneurship Expansion;
and, Reduction of Policy and Structural Barriers to Support Advanced
Manufacturing.
As an example, the Capital Investments surrounding Energy include
our Electronic Grid Modernization (GridMod) Plan. There is no question
that a reliable and efficient power grid is key to the future success
of Puerto Rico. The GridMod Plan is our proposal to repair, restore,
and harden our power system, to ultimately improve the quality of life,
trust, and reliability in energy services. The GridMod Plan emphasizes
three key areas: (1) Increased reliance on renewable energy resources,
such as wind and solar power, to reduce dependence on fossil fuels; (2)
new distributed energy resource technologies, such as energy storage
and microgrids, to improve resilience; and (3) affordability and
sustainability to improve the quality of life for U.S. citizens in
Puerto Rico.
As we continue to move toward affordable energy, the Puerto Rico
Electric Power Authority (PREPA) recently executed a San Juan natural
gas conversion contract, which should provide a framework for future
fuel supply conversion. The fuel conversion project involves upgrading
Units 5 and 6 of the San Juan Combined Cycle Power Plant so that those
units can operate on liquefied natural gas (LNG). The transaction,
announced in December 2018, is one of the most flexible LNG/gas
agreements in the world and undeniably the most flexible fuel supply
agreement in PREPA's portfolio. This transaction should produce
material savings for PREPA customers.
Last year, we took the first steps to achieving our vision by
assigning the COAs to State government agencies for implementation. A
total of 30 agencies were selected to be COA leads. Each of the
selected agencies will develop specific action plans to achieve the
goals identified in the COAs. Action plans will describe the projects
and related steps that must be taken, identify the funding sources, and
lay out a time line for completion.
To ensure proper oversight, coordination, and execution of the
COAs, the Governor established the Central Office of Recovery,
Reconstruction, and Resiliency (COR3) in December 2017 with all
necessary authority, powers, and resources to manage the post-disaster
reconstruction. Recognizing the need for expert support to ensure the
success of COR3, we underwent an extensive proposal process to contract
a group of highly-qualified third-party specialists with years of
disaster recovery and reconstruction experience. In the last 6 months,
COR3 established a comprehensive and effective digital information
system designed to manage Federal funding while also promoting
accountability and transparency to all stakeholders. The Disaster
Recovery System (DRS) is owned and operated by COR3 and is designed to
provide an independent data source, protections for data integrity, and
a system of record that can be used to reconcile discrepancies and push
accountability as both Federal and State partners work toward effective
coordination and collaboration in the execution of all recovery
programs. To increase the accessibility of the complex data within DRS
as well as to support public awareness, COR3 has established a
Transparency Portal website (https://www.recovery.pr/en/home.aspx) with
the purpose of documenting and demonstrating the status of the
recovery.
We are now 22 months into our recovery and making significant
progress toward the upwards of $100 billion in damages that Hurricanes
Irma and Maria caused. Earlier this year, Governor Rossello submitted
to Congress, in compliance with Pub. L. 115-123, a detailed status
report on our Federally-Mandated Economic and Disaster Recovery Plan
for Puerto Rico.\6\ The status report detailed both the progress and
challenges of our recovery.
---------------------------------------------------------------------------
\6\ Gov. Ricardo Rossello to Leaders of U.S. House and Senate,
``Progress Report on Economic and Disaster Recovery Plan,'' February
14, 2019.
---------------------------------------------------------------------------
Despite our successes, we continue to struggle with obsolete
policies and ever-changing rules governing the use of Federal funds on
the island. While we welcome Federal oversight as appropriate for the
expenditure of tens of billions of taxpayer dollars, I am concerned
that the recovery of Puerto Rico is not proceeding at the same pace as
those recoveries on the mainland. While some of these delays can be
attributed to magnitude of destruction on the island and the logistical
challenges associated with that, other delays appear to be as a result
of an emphasis on the amount of money expended instead of the outcomes
being achieved. The Puerto Rico Department of Education (PRDE) is a
victim of this. PRDE infrastructure was decimated by Hurricane Maria
when over 6,000 buildings on 1,109 campuses island-wide were impacted.
More than just places of learning, our schools serve as shelters of
last resort. They are often the only community building for miles and
provide the only recreational facilities for many of our communities.
In light of the need to rapidly rebuild in order to try to provide
stability to the youth of our island, we prioritized the consolidation
of several of our schools and focused on the rebuilding of 64. Since
initial estimates were completed nearly 8 months ago, FEMA has changed
the amount of money available for this project from over $1 billion
dollars to less than $400 million. Each time the estimate changes,
reviews and scopes of work must be redone delaying even further the
commencement of work. Six hundred fifty-nine days after Maria hit, over
300,000 students attend school each day in hurricane-damaged buildings
with no recreational facilities, leaking roofs, and patched-together
windows and doors. Of course, even when many of these children do go
home, it is to homes still partially repaired, often with temporary
``blue roofs''. Today, on the island, we still have nearly 20,000 homes
that have damaged or destroyed roofs, and as such, people are relying
on blue tarps to provide coverage over their homes. While we are not
arguing that the Federal Government should rebuild every damaged home
on the island, we do believe it is incumbent upon both Puerto Rico and
the Federal Government to ensure our schools are repaired to current
standards so our children at the very least have a safe, clean, and
comfortable place to learn and thrive.
While this is one example, we have also contended with:
Inconsistencies in FEMA's guidance with respect to the implementation
of Section 428 Alternative Procedures for permanent work Public
Assistance; significant delays in fixed-cost estimate approvals by
FEMA; unnecessary requirement of duplication in damage description and
dimension analysis by FEMA; refusal to define industry standards;
refusal to allow Puerto Rico to use its own licensed engineers such as
was done in New York and New Jersey; until recently the onerous
requirements of what FEMA refers to as the 270 process; and now another
change in the way FEMA will perform its roles in the management of
recovery funds. The island's reconstruction depends on completing these
processes as diligently and quickly as possible, but we can do little
without FEMA. Puerto Rico has only had approximately 117 projects
approved of the 1,475 Project Worksheets submitted in the 22 months
that have followed the Hurricanes. In stark contrast, in the same time
frame, over 13,000 projects were approved for Louisiana and Mississippi
in the wake of Hurricane Katrina. The discrepancy is startling.
An additional--and looming--threat to our recovery and
reconstruction efforts is the upcoming October 2019 deadline for
finalizing our Fixed Cost Estimates (FCE). On April 30, 2019, COR3
formally requested a blanket extension to the FCE deadline from FEMA,
because at the current pace of approvals by FEMA, it will be impossible
to meet the October 11, 2019 deadline. On May 13, 2019, FEMA responded
to our request stating that extensions would be approved on a case-by-
case basis and only if Puerto Rico demonstrates it is trying to
complete its portion of the FCE. This is impossible to achieve--FEMA
has yet to determine which industry standards we are building toward,
which in and of itself prevents anyone from determining how much
rebuilding will cost. It is important to note that even the State of
New York required 3 years to complete some of their FCEs, and our ask
for an extension is neither unique nor unprecedented in the history of
FEMA's relationship with the States and Territories.
Throughout the recovery process, a key function of COR3 has been to
work collaboratively with FEMA. Yet, on May 13, 2019, FEMA introduced a
new operating model to COR3, the National Delivery Model. While, in the
broadest sense, we support the implementation of the National Delivery
Model, we are concerned that the model as currently envisioned by FEMA
for Puerto Rico is not addressed within the framework FEMA and Puerto
Rico agreed to. By ``framework''--I refer to framework articulated in
the FEMA-State agreement and in FEMA implementation guidance for the
Section 428 pilot program. The National Delivery Model has never before
been used on a disaster where Section 428 alternative procedures are
governing nearly all of the disaster grant funding. Additionally,
because it is different from the delivery model Puerto Rico has been
using since September 2017, it inserts another change in procedures,
which raises concerns over impacts to the already glacial pace of
recovery on the island. We continue to work with FEMA as it implements
this new program on the island to understand how FEMA will adjust the
program to account for the current FEMA-State agreement and look
forward to FEMA's response to our request to amend the FEMA-State
agreement to account for the implementation of this new program. Most
critically, we look forward to ensuring Puerto Rico leads its own
recovery--just as every other State in the Union is able to do, such as
the ability to decide whether traditional PA or the 428 process is best
for each individual recovery project.
Puerto Rico will forever be grateful to the Federal Government for
its contributions to the island in the aftermath of Hurricanes Irma and
Maria. The Federal Government has been critical to the progress we
achieved, but I must emphasize--it is our recovery. I ask that moving
forward any decisions or processes made surrounding our recovery be
discussed with the government of Puerto Rico because we know the island
and its needs best. As FEMA says frequently, all disasters are
Federally-Supported, State-Managed, and Locally-Executed--Governor
Ricardo Rossello and I expect nothing less in Puerto Rico.
The question of Puerto Rico's ultimate political status and
relationship with the Federal Government is intimately linked to the
island's prospects for economic growth, fiscal stability, and
successful disaster recovery. By allowing Congress and the Federal
Executive branch to treat Puerto Rico differently and in ways that
discriminate against the island and its nearly 3.2 million U.S.
citizens, the current territorial status inherently limits our chances
of success. It does this by allowing the propagation of Federal laws
and policies toward the territory that lack the coherence and
consistency required to provide for the island's sustained
socioeconomic development and growth. We have roughly the same number
of U.S. citizens living in Puerto Rico as live in Utah or Iowa, yet we
do not have an equal representation in Congress for ourselves.
The unfortunate reality is that Federal policy toward Puerto Rico
is oftentimes executed as an afterthought and without a proper
understanding of the circumstances of the island and its residents.
There are countless examples of Federal policies and practices that
harm or limit Puerto Rico's economic development potential. Among these
are the disparate treatment and sometimes-outright exclusion of Puerto
Rico from a variety of Federal programs, the island's exclusion from a
multitude of Federal studies and statistics, the disproportionately low
level of Federal procurement from businesses in Puerto Rico, and
unnecessary regulations that limit interstate commerce, such as the
Electronic Export Information requirement.
The current reform process happening in Puerto Rico under Governor
Rossello's leadership, the debt-restricting tools contained in PROMESA,
and the post-disaster recovery and reconstruction, present an ideal
opportunity to finally define the ultimate political future of Puerto
Rico, and to begin a transition toward that end. Congress must act
definitively to resolve Puerto Rico's future political status, because
maintaining the status quo will only further delay the island's
recovery and reconstruction. Congress should implement the
democratically-expressed will of voters who have expressed twice in the
last 6 years a clear desire to end the current territory status and to
achieve Statehood for Puerto Rico. Indeed, for America and Puerto Rico
both, Statehood is the best possible answer and the best path forward
out of this century-old issue and into a new century of economic growth
and prosperity.
Despite our many challenges, the U.S. territory of Puerto Rico is
optimistic, determined, and full of potential. In the 22 months
following the Hurricanes of 2017, we have been challenged by both
significant population loss and an island-wide recession. Despite this,
Puerto Rico continues to endure and recover. Our goal is to re-imagine,
revitalize, and rebuild Puerto Rico in a way that we reach our full
capacity for the benefit of our island residents and America as a
whole. To do this, we must recognize and acknowledge our past mistakes
and work together diligently to correct them. If the most challenged
jurisdiction in America, Puerto Rico, can turn itself around and be
transformed into a place of thriving prosperity and sustainability, it
can serve as a beacon of hope for all Americans, and a sign to the
world that the best is yet to come. Together, with the support of
Congress, we can achieve this vision. We owe the American Citizens who
make Puerto Rico their home nothing less.
Mr. Payne. Thank you, sir.
I will now recognize Ms. Williams-Octalien to summarize her
statement for 5 minutes.
STATEMENT OF ADRIENNE L. WILLIAMS-OCTALIEN, DIRECTOR, OFFICE OF
DISASTER RECOVERY, V.I. PUBLIC FINANCE AUTHORITY
Ms. Williams-Octalien. Good morning, Chairman Payne,
Ranking Member King, and the Members of the subcommittee.
I am Adrienne Williams-Octalien, director of the Office of
Disaster Recovery in the U.S. Virgin Islands; and I thank you
for holding this hearing today and for the opportunity to
provide testimony on the status of the recovery in the Virgin
Islands.
The territory is fragile. With a population of a little
under 110,000 people, the recovery from 2 back-to-back Category
5 storms has been slow and painful. If you ask how the Virgin
Islands is doing, I will report we are banged-up, but we are
bandaged-up, and we are vulnerable.
Our only hospital on the island of Saint Croix is
functioning with one operating room with portions of the
hospital rendered unusable. A temporary hospital modular unit
is erected but still has to be outfitted with furniture,
fixtures, and equipment. Residents are still being flown off
island to access critical care that otherwise cannot be
provided by our health care facilities. This has a detrimental
financial impact on the territory's public health system, as
much-needed revenue to support our institutions leave with
these patients. Many of our roads remain in disrepair. Our
schools still have temporary fixes with no permanent solutions
for the upcoming school year. Many of our public buildings
offer less-than-optimum working conditions for our staff due to
hurricane damage. Housing remains an area of great concern, as
still we have families with compromised roofs covered with
tarpaulins that have exceeded their life expectancy.
Through the FEMA STEP program, the territory has been able
to repair 7,200 homes, but there are still 3,500 homeowners are
still in need of repair, and we are moving deeper into
hurricane season. Yet almost 2 years after the storms, $1.8
billion have been obligated to the territory, but only $654
million has been permitted work. The territory is grateful that
Congress has recognized the complexities of the recovery in the
Caribbean. The efforts through the Disaster Recovery Reform Act
of 2018, the Bipartisan Budget Act of 2018, and the Disaster
Act of 2019 are well received.
The consternation comes with the implementation of these
laws. The Bipartisan Budget Act allows for the use of industry
standards in the repair of pre-disaster damages and undamaged
components. It took 222 days from the passage of the law for
FEMA to issue the guidance that allows the territories to
access these new authorities.
The Disaster Reform Act of 2018 allows for the use of
consensus-based industry standards. While we understand that
FEMA's guidance is forthcoming, it has been 279 days and
counting.
In April 2019, FEMA denied the U.S. Virgin Islands' request
for a territory-managed 408 Permanent Housing Construction
Pilot Program because the policy was not ready, even though
Congress gave FEMA the authority for pilot programs until
policy was developed.
We are also waiting on FEMA guidance in the disaster
supplemental passed in June 2019. The real-life implementations
are dozens of critical infrastructure projects that were close
to meeting the 50 percent threshold for replacement under the
old rules are on hold, pending FEMA guidance. The time frames
for the guidance to be issued are lengthy for both the HUD
CDBG-DR program, as well as the FEMA-funded programs, but we
have no choice. We have to wait for the guidance because the
territory is fragile in its economic State and unable to risk
expending funds that could be denied reimbursement. So, to the
extent possible, we recommend that time frames, deadlines be
included in legislation for the administering entities to
produce guidance.
The 2017 hurricane seasons not only wreaked havoc on our
critical infrastructure but to the treasury of the Virgin
Islands as well. The financial impact of back-to-back storms is
$11.25 billion, and the projected revenue loss from the storms
is approximately $576 million. Projects funded under FEMA's
Public Assistance Program are estimated to cost $5 billion with
a 10 percent match requirement, totaling approximately $500
million. The identification of funds to meet the match
requirements is concerning, considering the territory's fragile
condition.
It is our deepest hope that consideration be given to this
request. If the 10 percent cost share is waived, the Virgin
Islands can instead redirect those funds to help rebuild the
thousands of homes damaged by the hurricanes and to protect the
Federal investment in reconstructed critical infrastructure and
lessen the need for taxpayer-funded disaster assistance in the
future.
We remain grateful for the hardworking men of FEMA who have
dedicated their time to assist in the recovery of our beloved
islands. We express our appreciation for their willingness to
address the pervasive issues of the recovery and their
commitment to providing resolutions. The good news is the new
Public Assistance model has reduced the steps to obligation.
The not-so-good news is it is still 47 steps. The lack of
resources and qualified manpower to complete the detailed
damage description by the March 2020 deadline is also of great
concern. After this time frame, the territory will be subject
to FEMA's discretion on a project-by-project basis to grant an
extension. Unless the pace increases, we are fearful that all
the DDDs will not be completed by the deadline, despite our
best efforts.
We are not insensitive to the challenges of FEMA with
multiple disasters across the Nation, but we do not want that
concern to affect the territory negatively. Despite these
challenges, the resilient people of the Virgin Islands and our
resilience is alive and well. We must ensure that Federal
relief is not distributed with the heavy hand of bureaucracy
where we focus more on the PDMGs and the DDDs and the NDRFs and
forget the p-e-o-p-l-e. We are still suffering from the effects
of these unprecedented storms.
On behalf of the Governor, Albert Bryan, Jr., of the Virgin
Islands and the residents, we thank you for the opportunity to
provide this testimony.
[The prepared statement of Ms. Williams-Octalien follows:]
Statement of Adrienne Williams-Octalien
June 12, 2019
Good Morning, Chairman Payne, Ranking Member King, and Members of
the subcommittee. I am Adrienne Williams-Octalien, director of the
Office of Disaster Recovery in the U.S. Virgin Islands. Thank you for
the holding this hearing and for the opportunity to provide testimony
on the status of the recovery in the Virgin Islands.
The Territory is fragile. With a population of a little under
110,000 people, the recovery from 2 back-to-back Category 5 storms has
been slow and painful.
If you ask, how is the Virgin Islands doing? I report that we were
banged-up pretty badly, but bandaged-up with temporary fixes that have
left our infrastructure very vulnerable.
Our only hospital on the island of St. Croix is functioning with
one operating room with portions of the hospital rendered unusable. A
temporary hospital modular unit is erected but still has to be
outfitted with furniture, fixtures, and equipment. Residents are still
being flown off-island to access critical care that otherwise cannot be
provided by our health care facilities. This has a detrimental
financial impact on the territory's public health system, as much
needed revenue to support our institutions leave with these patients.
Many of our roads remain in despair. Ours schools still only have
temporary fixes with no permanent solutions before the upcoming school
year. Many of our public buildings offer less-than-optimum working
environments due to hurricane damage.
Housing remains an area of great concern as we still have families
with compromised roofs covered with tarpaulins which have more than
exceeded their life expectancy. Through the FEMA STEP Program, the
Territory has been able to repair 7,200 homes but 3,563 homeowners are
still in need of repairs as we move deeper into the hurricane season.
Yet almost 2 years after the storms, of the $1.8 billion that have
obligated to the territory only $654 million has been obligated to
permanent work.
The territory is grateful that Congress has recognized the
complexities of the recovery in the Caribbean. The efforts through the
Disaster Recovery Reform Act of 2018, the Bipartisan Budget Act of 2018
and the Disaster Relief Act of 2019 are well received.
The consternation comes with the implementation of these
legislation. The Bipartisan Budget Act allows for use of Industry
Standards and repair of pre-disaster damages and undamaged components.
It took 222 days from the passage of the legislation for FEMA to issue
the guidance that allows the territories to access these new
authorities.
The Disaster Reform Act of 2018 allows for use of Consensus-Based
Industry Standards. While we understand that FEMA guidance is
forthcoming, the wait is 279 days and counting.
In April 2019, FEMA denied the USVI's request for a territory-
managed 408 Permanent Housing Construction Pilot Program because the
policy was not ready (even though Congress gave FEMA the authority for
Pilot Programs until policy was developed).
We are also awaiting the FEMA guidance on the Disaster Supplemental
passed in June 2019. The real-life implications are dozens of critical
infrastructure projects that were close to meeting the 50 percent
threshold for replacement under the old rules are on hold pending FEMA
guidance.
The time frames for the guidance to be issued are lengthy for both
the HUD CDBG-DR and the FEMA-funded programs. We have no choice but to
wait for the guidance because the territory in its fragile economic
state is unable to risk expending funds that could be denied
reimbursement. To the extent possible, we recommend that time frames/
deadlines be included in the legislation for the administering agencies
to produce the implementing guidance.
The 2017 hurricanes not only wreaked havoc on our critical
infrastructure but to the treasury of the Virgin Islands as well. The
financial impact of the back-to-back storms was $11.25 billion; and the
projected revenue loss from the storms is approximately $576 million.
Projects funded under FEMA's Public Assistance program are estimated to
cost $5 billion with a 10 percent match requirement totaling
approximately $500 million. The identification of funds to meet the
match requirements is concerning considering the territory's fragile
financial condition.
The territory requested that the President direct FEMA to utilize
the authorities of the Insular Areas Act to waive the non-Federal cost
share for the FEMA Public Assistance program. We are grateful for the
decision to invoke the authorities under the Act to waive the cost
share for the Hazard Mitigation Grant Program.
It is our deepest hope that consideration be given to this request.
If the 10 percent cost share is waived, the USVI can instead redirect
those funds to help rebuild the thousands of homes damaged by the
hurricanes and to protect the Federal investments in reconstructed
critical infrastructure to lessen the need for taxpayer-funded disaster
assistance in the future.
We remain grateful for the hard-working men and women of FEMA who
have dedicated their time to assist in the recovery of our beloved
islands. We express our appreciation to FEMA for their willingness to
address the pervasive issues of the Recovery and their commitment to
providing resolutions. The good news is the new PA model has reduced
the steps to obligation. The not-so-good news is it still is 47 steps.
The lack of resources and qualified manpower to complete the Detail
Damage Description by the March 2020 deadline is also of concern. After
this time frame, the territory would be subject to FEMA's discretion on
a project-by-project basis to grant an extension. Unless the pace
increases, we are fearful that all the DDDs will not be completed by
the deadline despite our best efforts.
We are not insensitive to the challenges that FEMA faces with
multiple disasters across the Nation and the challenges with the human
capital to meet the demand. We do however remain concerned that the
Territory does not bear the brunt of this shortcoming.
Despite these challenges the resilient spirit of the people of the
Virgin Islands is alive and well. We must ensure that the Federal
relief is not distributed with the heavy hand of bureaucracy where we
focus more on the PDMG, the DDD, and the NDRF and forget the PEOPLE who
are still suffering from the effects of these unprecedented storms.
I thank you for the opportunity to provide this testimony.
Thank you.
ATTACHMENT.--U.S. VIRGIN ISLANDS--WAIVER OF FEMA COST SHARE
REQUEST.--The U.S. Virgin Islands requests that the President
direct FEMA to utilize the authorities of the Insular Areas Act to
waive the non-Federal cost share for the FEMA Public Assistance
program.
BACKGROUND.--In recognition of the persistent economic challenges
in the Insular Areas of the U.S., which include the USVI (but not
Puerto Rico), the Insular Areas Act (48 USC 1469a) authorizes that
``any department or agency, in its discretion, may (i) waive any
requirement for matching funds otherwise required by law to be provided
by the Insular Area involved.''
Waiving various non-Federal matching funds using the Insular Areas
Act authority has been a common practice in disaster recovery for more
than two decades, especially after catastrophic events. In fact, in
recognition of the severity of Hurricanes Irma and Maria, FEMA has
already invoked the Insular Areas Act authority to waive the 25 percent
non-Federal matching requirement for the Hazard Mitigation Grant
Program in the USVI.
RATIONALE FOR THE REQUEST.--The USVI fully appreciates that one of
the lessons learned from the 100 percent Federal cost share granted
after Hurricane Katrina is that when a State has no ``skin in the
game'' in the form of a local match the recovery can be delayed and the
cost of Federal disaster assistance can increase significantly.
Nonetheless, as Congress recognized in enacting the Insular Areas Act,
Insular Areas usually do not have the resources available to come up
with the local match in order to access Federal funds. Further, in the
aftermath of these two unprecedented hurricanes, the USVI is in a very
difficult financial position, with significant loss of revenues and
significant previously-unbudgeted costs projected over several years
attributable to the hurricanes, including sizable tourism-related
losses. Indeed, the USVI has been required to rely on substantial
Community Disaster Loan (CDL) funding in order to maintain basic
governmental services.
Furthermore, as ``skin in the game,'' the USVI has already
committed to using FEMA's Section 428 Alternative Public Assistance
Program Procedures to the maximum extent possible to develop capped,
fixed grants which have been proven to be the most cost-effective
approach, even though these projects carry substantive potential
financial risk for the territory.
PROPOSED SOLUTION.--The USVI respectfully requests that FEMA waive
the 10 percent non-Federal cost share on all FEMA Public Assistance
Program Work (Categories A-G), including Direct Federal Assistance, and
Other Needs Assistance under the Individual Assistance program.
BENEFICIAL OUTCOMES.--If the 10 percent cost share is not waived,
the USVI will have to dedicate a substantial portion of its HUD CDBG-DR
funds--more than $500 million--to cover the non-Federal share. If the
10 percent cost share is waived, the USVI can instead redirect those
funds to help rebuild the thousands of homes damaged by the hurricanes
and to protect the Federal investments in reconstructed critical
infrastructure to lessen the need for taxpayer-funded disaster
assistance in the future.
COSTS.--Based upon current projections of $4.5-5.5 billion of
eligible FEMA Public Assistance program costs, the amount of non-
Federal matching funds to be waived at 10 percent would be
approximately $500 million.
Mr. Payne. Thank you very much.
I now recognize Mr. Currie to summarize his statement for 5
minutes.
STATEMENT OF CHRIS P. CURRIE, DIRECTOR, HOMELAND SECURITY AND
JUSTICE, U.S. GOVERNMENT ACCOUNTABILITY OFFICE
Mr. Currie. Thank you, Chairman Payne, Ranking Member King,
Chairman Thompson, other Members of the committee.
It is an honor to be here today to talk about GAO's work,
looking at the recovery in Puerto Rico and the Virgin Islands.
Since Hurricanes Irma and Maria, GAO has been conducting
extensive oversight in both locations of the Federal funding
that is being spent there. Frankly, the recovery so far has
been slow and very challenging and challenges at all levels of
government.
I think everyone on this committee today has had a
catastrophic disaster in their jurisdiction. So you are
familiar that recovery is a very complex, frustrating process
often. Federal recovery programs are complicated and can be
frustrating for State and locals to deal with. We have seen
this across the country in California, Texas, Florida, New
York, New Jersey. If States like that that have high levels of
preparedness and tremendous emergency management capacity have
struggled, it is not a surprise that Puerto Rico and the Virgin
Islands have also struggled with these processes, too.
However, there are some things that are very unique in
these locations that I think are worth pointing out. First of
all, the damage across the jurisdiction was complete. Unlike
other States like Texas, Florida, where non-affected counties
and jurisdictions could help out those that were affected, that
was not the case here. All resources and assistance and
recovery aid had to come from outside. That has complicated
things.
Because of the fiscal position and the bankruptcy situation
of the territories, unlike other States, there was no seed
money, and appropriations couldn't be diverted to jump-start
recovery. All of the assistance had to be provided, most of it
by the Federal Government, which has also caused some delays,
too.
Also, the recovery capacity is a very important thing. It
is not easy to just be ready to manage $10 billion to $50
billion as a territory. Some of these--in the case of Puerto
Rico and Virgin Islands, this is more money than their annual
budget 2 times over, and that is a huge challenge. So that had
to be built over time. Adrienne and Omar's offices have been--
had to build their capacity over time, and that has taken some
time to address as well.
So, in terms of the status of recovery, what we have
reported is that so far FEMA has provided about $7.4 billion in
Public Assistance grants. This is the main program that is used
to build infrastructure back on the islands. Most of that,
though, it is really important to understand, is for emergency
work. What I mean by that is things that have already occurred
like debris removal, power restoration, reimbursements. That is
just a small down payment on what is going to be spent over the
long haul on more permanent work projects.
So now let me turn to FEMA because they have absolutely
been some major challenges on the FEMA side. I want to also
divorce some of those challenges from the FEMA work force. I
have been to Puerto Rico and the Virgin Islands many times. The
work force is dedicated. They work hard. They are making
sacrifices every day. They care about this recovery, too. But
that is separate from programmatic and policy challenges that
we have seen.
A big area that Mr. Payne talked about was the challenge in
implementing new approaches to the Public Assistance Grant
Program. The Alternative Procedures have never been used on the
scale they are being uses, for example, in Puerto Rico. They
have been used on certain projects around the country but not
territory-wide, system-wide, and sector-wide. Frankly, that has
caused major challenges, not just for the territories but
FEMA's own staff. Many of these challenges we have identified
are FEMA officials telling us these things, not just our
discussions with folks at the local level.
The fixed-cost estimate is another massive challenge. Under
the alternative procedures--and I am going to show you some
pictures as we go here of pictures we have taken recently, as
recent as just March in both locations--but the fixed-cost
estimates have to be agreed on by FEMA and the territories
before projects can move forward. So far, there are, in Puerto
Rico, there are 4 agreed-upon permanent work fixed-cost
estimates. In Virgin Islands, we reported there are two. Just
keep in mind this is thousands--there are thousands of
potential projects. So, this is where we are in recovery. There
is a long way to go in this area.
To be clear, FEMA is working to try to address these issues
as they come up and is trying to issue additional guidance but
the scale and the complexity is so challenging, it is a major
problem and challenge.
I would like to end really quickly with just a positive
note moving forward. Because we are still early in recovery,
there is still a huge opportunity to make sure that these
dollars are invested smartly. When I say ``smartly,'' I mean
invested in a way that is going to rebuild the infrastructure
in both places to be resilient to the future disasters they are
going to face. Both of these are islands in the Caribbean. They
are going to be hit with more hurricanes and potential
earthquakes moving forward.
I think it is extremely important that we monitor and
oversee the investment and funding to make sure that we are not
spending Federal dollars later on down the road to rebuild the
same infrastructure.
I look forward to the questions. Thank you very much.
[The prepared statement of Mr. Currie follows:]
Prepared Statement of Chris P. Currie
July 11, 2019
gao highlights
Highlights of GAO-19-662T, a testimony before the Subcommittee on
Emergency Preparedness, Response, and Recovery, Committee on Homeland
Security, House of Representatives.
Why GAO Did This Study
In September 2017, two major hurricanes--Irma and Maria--struck
Puerto Rico and the USVI, causing billions of dollars in damage to
infrastructure, housing, and the economy. FEMA--a component of the
Department of Homeland Security--is the lead Federal agency responsible
for assisting Puerto Rico and the USVI to recover from these natural
disasters. Among other responsibilities, FEMA is administering the
Public Assistance program in partnership with the governments of Puerto
Rico and the USVI, providing them grant funding for response and
recovery activities, including debris removal efforts, life-saving
emergency protective measures, and the repair, replacement, or
restoration of public infrastructure.
This statement describes: (1) The status of FEMA's Public
Assistance grant funding in Puerto Rico and the USVI in response to the
2017 hurricanes as of April 2019, (2) the establishment of recovery
offices in Puerto Rico and the USVI, and (3) challenges in implementing
the Public Assistance program and actions FEMA has taken to address
them. This statement is based on GAO reports issued in February, March,
and June 2019, and includes preliminary observations from on-going GAO
reviews of FEMA operations. For on-going work, GAO analyzed program
documents and data on obligations and expenditures; interviewed agency
officials; and visited disaster-damaged areas in Puerto Rico and the
USVI, where GAO also interviewed FEMA and local officials.
GAO will continue to monitor the progress of Puerto Rico's and the
USVI's recovery as part of its on-going work.
emergency management.--fema's disaster recovery efforts in puerto rico
and the u.s. virgin islands
What GAO Found
GAO's prior and on-going work found that the Federal Emergency
Management Agency (FEMA) obligated about $7.4 billion in Public
Assistance grant funding to Puerto Rico and the U.S. Virgin Islands
(USVI) as of April 2019, in response to the 2017 hurricanes. FEMA
obligated about $6.2 billion in Public Assistance grants for emergency
work--debris removal activities, power restoration, and other emergency
measures--and about $965 million in Public Assistance grants for
permanent work--including the repair or replacement of public
infrastructure such as roads, electrical utilities, and damaged
buildings. Further, FEMA is continuing to work with Puerto Rico and the
USVI to develop additional permanent work projects to repair damaged
public infrastructure, such as schools and hospitals (see figure).
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
In 2017, Puerto Rico established the Central Office for Recovery,
Reconstruction, and Resilience and in 2019 the USVI established the
Office of Disaster Recovery to coordinate and oversee Federal recovery
efforts. Among other things, these recovery offices are responsible for
monitoring and overseeing the Public Assistance program and developing
internal controls to ensure it is implemented in accordance with
applicable laws, regulations, and FEMA requirements.
GAO's prior and on-going work highlighted challenges with the
Public Assistance program including concerns about the clarity of
FEMA's guidance, and the time and resources needed to transition to a
new Public Assistance delivery model in Puerto Rico. Further, Puerto
Rico and USVI officials reported difficulties understanding FEMA's
implementation of new flexibilities authorized by law as well as delays
in jointly developing cost estimates for long-term recovery projects
such as the repair or replacement of hospitals, buildings, and other
public infrastructure. FEMA has taken some actions to help address
these issues, including developing additional guidance and specific
training. However, it is too soon to determine the effectiveness of
FEMA's actions. GAO will continue to evaluate the Public Assistance
program in the USVI and Puerto Rico and plans to report its findings in
late 2019 and early 2020, respectively.
Chairman Payne, Ranking Member King, and Members of the
subcommittee: Thank you for the opportunity to discuss our work on the
Federal Emergency Management Agency's (FEMA) recovery operations in
Puerto Rico and the U.S. Virgin Islands (USVI).
In the span of 14 days in September 2017, 2 major hurricanes--Irma
and Maria--struck Puerto Rico and the USVI, severely damaging critical
infrastructure and causing tens of billions of dollars in damage.
Specifically, on September 6, 2017, Hurricane Irma passed just north of
the USVI islands of St. Thomas and St. John and Puerto Rico as a
Category 5 hurricane, causing severe wind and rain inundation.\1\ Less
than 2 weeks later, on September 19, 2017, Hurricane Maria struck the
USVI island of St. Croix as a Category 5 hurricane and, hours later on
September 20, 2017, made a direct hit as a Category 4 hurricane on the
main island of Puerto Rico (see fig. 1).
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\1\ The National Oceanic and Atmospheric Administration (NOAA)
measures hurricanes on a scale from 1 to 5 with a Category 1 being the
least intense and a Category 5 being the most intense. NOAA defines a
Category 5 hurricane as one with winds above 157 miles per hour.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
The storms caused extensive damage to roads, bridges, and other
public infrastructure. Further, the hurricanes devastated Puerto Rico's
electrical system--it took roughly 11 months for power to be restored
to all of the customers able to receive power, the longest blackout in
U.S. history. In its recovery plan, Puerto Rico estimated that $132
billion will be needed from 2018 through 2028 to repair and reconstruct
the infrastructure damaged by the hurricanes.\2\
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\2\ Central Office for Recovery, Reconstruction and Resiliency,
Government of Puerto Rico, Transformation and Innovation in the Wake of
Devastation: An Economic and Disaster Recovery Plan for Puerto Rico
(August 8, 2018).
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In the USVI, the storms damaged more than half of the territory's
housing units as well as its hospitals, schools, and water and
wastewater facilities, according to a 2018 report from the USVI
Hurricane Recovery and Resilience Task Force.\3\ Overall, this report
estimated that the hurricanes caused approximately $10.7 billion in
total damages across the USVI.
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\3\ In October 2017, the Governor of the USVI called for the USVI
Hurricane Recovery and Resilience Task Force to draft a report
assessing the USVI's hurricane response and guiding its efforts during
the rebuilding process. The report was released in September 2018 and
details recovery initiatives across 14 sectors, including the economy,
energy, communications, transportation, and more. The report can be
found at https://www.usvihurricanetaskforce.org/. We reported our
observations on Federal support for electricity grid restoration in
Puerto Rico and the USVI as a result of the 2017 hurricanes in a
separate report. See GAO, 2017 Hurricane Season: Federal Support for
Electricity Grid Restoration in the U.S. Virgin Islands and Puerto
Rico, GAO-19-296 (Washington, DC: Apr. 18, 2019).
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The storms exacerbated the financial situations in the territories,
which were operating under severe fiscal constraints prior to the
hurricanes.\4\ See figure 2 for examples of hurricane damage to Puerto
Rico and the USVI.
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\4\ The USVI's total public debt outstanding increased between
fiscal years 2005 and 2015 from $1.4 billion to $2.7 billion. The
balance subsequently declined to $2.6 billion in fiscal year 2016--the
most recent year for which data were available--due to the repayment of
existing debt. Further, the USVI has not been able to access capital
markets at favorable interest rates since January 2017, when investors
began to demand higher rates to compensate for what they perceived as
increased risks in the territory. See GAO, U.S. Territories: Public
Debt Outlook--2019 Update, GAO-19-525 (Washington, DC: June 28, 2019).
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
FEMA--a component of the Department of Homeland Security (DHS)--is
the lead Federal agency responsible for disaster preparedness,
response, and recovery, which includes assisting Puerto Rico and the
USVI as they recover from these natural disasters.\5\ Among other
responsibilities, FEMA administers the Public Assistance program
through a partnership with the governments of Puerto Rico and the USVI
to provide grant funding for a wide range of eligible response and
recovery activities. These activities include debris removal efforts;
life-saving emergency protective measures; and the repair, replacement,
or restoration of disaster-damaged publicly owned facilities,
electrical utilities, roads and bridges; and more.
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\5\ See 6 U.S.C. 313.
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My testimony today discusses our prior and on-going work on
disaster recovery efforts in Puerto Rico and the USVI following
Hurricanes Irma and Maria in 2017, including:
1. the status of Public Assistance grant funding in Puerto Rico and
the USVI, as of April 2019;
2. the recovery offices Puerto Rico and the USVI have established
to manage recovery efforts; and
3. the challenges FEMA, Puerto Rico, and the USVI have faced in
implementing the Public Assistance program, and the actions
FEMA has taken to address them.
My statement is based on reports we issued in February, March, and
June 2019 as well as data and preliminary observations from our on-
going reviews of FEMA's recovery activities in Puerto Rico and the USVI
for a number of Congressional committees and subcommittees. To perform
our prior work, we reviewed Federal laws related to emergency
management, analyzed FEMA data and documentation, and interviewed
relevant agency officials. More detailed information on the scope and
methodology for our prior work can be found in the issued reports
listed in appendix I.
To develop our preliminary observations from on-going work, we
reviewed Federal laws and documentation from FEMA, Puerto Rico, and the
USVI, including policies, procedures, and guidance specific to
emergency management. We also obtained and analyzed data from FEMA's
Emergency Management Mission Integrated Environment and Integrated
Financial Management Information System on Public Assistance program
obligations and Puerto Rico's and the USVI's expenditures as of April
2019.\6\ We reviewed existing information about these systems,
interviewed data users and managers responsible for these data, and
cross-checked data across sources to ensure consistency. We determined
these data to be reliable for the purposes of this statement. Moreover,
we conducted site visits to Puerto Rico and the USVI to meet with
Federal, territorial, and local government and emergency management
officials to discuss disaster recovery efforts and associated
challenges. For a list of our on-going emergency management reviews,
see appendix II.
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\6\ An obligation is a definite commitment that creates a legal
liability of the Government for the payment of goods and services
ordered or received. For the purposes of this statement, obligations
represent the amount of grant funding FEMA provided through the Public
Assistance program for specific projects in the USVI and Puerto Rico.
An expenditure is an amount paid by Federal agencies, by cash or cash
equivalent, during the fiscal year to liquidate Government obligations.
For the purposes of this statement, an expenditure represents the
actual spending by the USVI and Puerto Rico governments of money
obligated by the Federal Government.
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We conducted the work on which this statement is based in
accordance with generally accepted Government auditing standards. Those
standards require that we plan and perform the audit to obtain
sufficient, appropriate evidence to provide a reasonable basis for our
findings and conclusions based on our audit objectives. We believe that
the evidence obtained provides a reasonable basis for our findings and
conclusions based on our audit objectives.
background
FEMA's Public Assistance Program
FEMA's Public Assistance program provides grant funding to State,
territorial, local, and Tribal governments as well as certain types of
private nonprofit organizations to assist with responding to and
recovering from Presidentially-declared major disasters or
emergencies.\7\ As shown in figure 3, Public Assistance grant funds are
categorized broadly as ``emergency work'' or ``permanent work.'' Within
these broad categories are separate subcategories. In addition to the
emergency work and permanent work categories, the program includes
category Z, which represents indirect costs, direct administrative
costs, and any other administrative expenses associated with a specific
project.
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\7\ In accordance with the Robert T. Stafford Disaster Relief and
Emergency Assistance Act (Stafford Act), as amended, the President of
the United States may declare that a major disaster or emergency exists
in response to a Governor's or Tribal chief executive's request if the
disaster is of such severity and magnitude that effective response is
beyond the capabilities of a State, Tribe, or local government and
Federal assistance is necessary. See 42 U.S.C. 5170-5172. The Public
Assistance program represents the largest share of the Disaster Relief
Fund, which is the primary source of Federal disaster assistance for
State and local governments when a disaster is declared.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
FEMA's Public Assistance program also provides grant funding for
cost-effective hazard mitigation measures to reduce or eliminate the
long-term risk to people and property from future natural and man-made
disasters and their effects.\8\ For example, a community that had a
fire station damaged by a disaster could use Public Assistance grant
funding to repair the facility and incorporate additional measures such
as installing hurricane shutters over the windows to mitigate the
potential for future damage.
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\8\ FEMA may fund hazard mitigation measures related to the damaged
facilities receiving Public Assistance grant funding pursuant to
section 406 of the Stafford Act, as amended. 42 U.S.C. 5 172; 44
C.F.R. 206.226.
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FEMA, the State or territorial government (the recipient), and
local or territorial entities (the subrecipient) work together to
develop projects under the Public Assistance program. After a project
has completed FEMA's review process and is approved, FEMA obligates
funding for the project by placing money into an account where the
recipient has the authority to draw down--or withdraw--funding to pay
the subrecipient for eligible work upon completion.
The Public Assistance Alternative Procedures Program in Puerto Rico and
the USVI
The Sandy Recovery Improvement Act of 2013 authorized the use of
alternative procedures in administering the Public Assistance program,
thereby providing new flexibilities to FEMA, States, territories, and
local governments for debris removal, infrastructure repair, and
rebuilding projects using funds from this program.\9\ Unlike in the
standard Public Assistance program where FEMA will fund the actual cost
of a project, the Public Assistance alternative procedures allow awards
for permanent work projects to be made on the basis of fixed-cost
estimates to provide financial incentives for the timely and cost-
effective completion of work.
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\9\ The Sandy Recovery Improvement Act of 2013 amended the Stafford
Act by adding Section 428, which authorized FEMA to approve Public
Assistance program projects under the alternative procedures provided
by that section for any Presidentially-declared major disaster or
emergency. This section further authorized FEMA to carry out the
alternative procedures as a pilot program until FEMA promulgates
regulations to implement this section. Pub. L. No. 113-2, div. B,
1102(2), 127 Stat. 39, amending Pub. L. No. 93-288, tit. IV, 428
(codified at 42 U.S.C. 5189f). The stated goals of the alternative
procedures are to reduce the costs to the Federal Government, increase
flexibility in the administration of the Public Assistance program,
expedite the provision of assistance under the program, and provide
financial incentives for recipients of the program for the timely and
cost-effective completion of projects.
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Under these procedures, if the actual cost of the project exceeds
the fixed-cost estimate agreed upon by FEMA and the recipient, the
recipient or subrecipient is responsible for the additional costs at
the time of the close-out process. However, if the actual cost of
completing eligible work for a project is below the estimate, the
recipient may use the remaining funds for additional cost-effective
hazard mitigation measures to increase the resilience of public
infrastructure. In addition, these funds may also be used for
activities that improve the recipient's or subrecipient's future Public
Assistance operations or planning.
In October 2017, Puerto Rico requested, and FEMA approved, the use
of the alternative procedures program for all large-project funding for
Public Assistance permanent work projects in categories C through
G.\10\ Although FEMA had approved alternative procedure grants in 30
States as of April 2018, in these cases, alternative procedures were
used on a project-by-project basis. Puerto Rico's recovery from the
2017 hurricanes is the first recovery to use alternative procedures for
all large permanent work projects. In addition, in July 2018, FEMA
approved a request from the Governor of the USVI to transition to using
the Public Assistance alternative procedures program for permanent work
in the territory. Unlike in Puerto Rico, the USVI may pursue the
alternative procedures on a project-by-project basis.
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\10\ According to a November 2017 amendment to Puerto Rico's major
disaster declaration, due to the extraordinary level of infrastructure
damage caused by Hurricane Maria, as well as the financial status of
Puerto Rico, officials chose to use the alternative procedures for all
large-project funding for Public Assistance categories C through G
pursuant to section 428 of the Stafford Act. Puerto Rico; Amendment No.
5 to Notice of a Major Disaster Declaration, 82 Fed. Reg. 53,514 (Nov.
16, 2017). For fiscal year 2018, the large project threshold was
$125,500.
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fema had obligated $5.6 billion and $1.8 billion in public assistance
grant funding in puerto rico and the usvi, respectively, as of april
2019
As of April 2019, FEMA had obligated a total of about $7.4 billion
in grant funds for Public Assistance projects in both Puerto Rico and
the USVI.\11\ Specifically, as shown in figure 4, FEMA obligated
approximately $5.6 billion for 1,264 Public Assistance projects in
Puerto Rico, including approximately $5.1 billion (90 percent) for
emergency work (categories A and B) and $377.7 million (7 percent) for
permanent work in categories C through G).\12\
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\11\ These data include Public Assistance grant funding only and do
not include obligations and expenditures for, among other Federal
disaster assistance programs, direct Federal mission assignments, in
which a Federal agency is tasked with providing eligible emergency work
or debris removal services to a territory or State, or for other
categories of mission assignments. In April 2019, we reported that FEMA
had obligated an additional $2 billion in Puerto Rico and $63 million
in the USVI for direct Federal assistance through mission assignments
for temporary emergency power and grid restoration efforts as of July
2018. See GAO, 2017 Hurricane Season: Federal Support for Electricity
Grid Restoration in the U.S. Virgin Islands and Puerto Rico GAO-19-296
(Washington, DC: April 18, 2019).
\12\ An additional $136 million (3 percent) was obligated for
management and direct administrative costs.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Puerto Rico had expended approximately $3.5 billion--about 61
percent of total Public Assistance grant obligations in Puerto Rico--as
of April 2019. Ninety-six percent of the expended amount went toward
emergency work projects in categories A and B while just over 1 percent
went toward permanent work projects. The majority of FEMA's obligations
and the funding Puerto Rico expended as of April 2019 are for emergency
work because these projects began soon after the disasters struck and
focused on debris removal and providing assistance to address immediate
threats to life and property. In contrast, permanent work projects take
time to identify, develop, and ultimately complete as they represent
the longer-term repair and restoration of public infrastructure.
In the USVI, FEMA had obligated approximately $1.8 billion for 583
Public Assistance projects across the territory, as of April 2019.
Similar to Public Assistance grant funding in Puerto Rico, the majority
of funding FEMA obligated and the USVI expended was in emergency work
categories A and B. Specifically, FEMA obligated approximately $1.1
billion (63 percent) for emergency work (categories A and B) and $587.3
million (33 percent) for permanent work (categories C through G) in the
territory (see fig. 5).\13\
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\13\ An additional $66.0 million (4 percent) was obligated for
management costs.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Of the $1.8 billion FEMA obligated for Public Assistance projects,
the USVI had expended approximately $982.4 million as of April 2019.
Specifically, the USVI had expended about $808.1 million (82 percent)
for emergency work projects in categories A and B and $163.1 million
(17 percent) for permanent work projects in categories C through G.\14\
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\14\ The USVI also expended about $11.2 million for management
costs under category Z. As noted above, this category represents any
indirect cost, any direct administrative cost, and any other
administrative expense associated with a specific project.
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Emergency work.--As of April 2019, FEMA had obligated a total of
approximately $6.2 billion for emergency work projects in Puerto Rico
and the USVI--including about $5.1 billion in Puerto Rico and $1.1
billion in the USVI. These projects focused on debris removal
activities and providing assistance to address immediate threats to
life and property. For example, as of April 2019, FEMA had obligated
$138.9 million for projects focused on debris removal activities in the
USVI under category A. This included $45.9 million to the USVI
Department of Public Works for USVI-wide debris removal efforts and
$39.1 million to the USVI Water and Power Authority for these
activities in St. Croix (see fig. 6).
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
In another example, FEMA obligated more than $140.0 million to the
Puerto Rico Aqueducts and Sewer Authority under category B to fund
emergency protective measures, including using back-up generators to
supply water to the island after Hurricane Maria, among other things.
Further, as of April 2019, FEMA had obligated $1.1 billion in Puerto
Rico and $278 million in the USVI to fund the Sheltering and Temporary
Essential Power pilot program. This program, which is implemented as a
subprogram under Public Assistance program category B, is intended to
provide essential repairs or restore power to private residences to
allow affected individuals to return or remain in their homes, thereby
reducing the demand for other shelter options. We are continuing to
assess this program as part of our on-going work on recovery efforts in
the USVI.
Permanent work.--As of April 2019, FEMA had obligated approximately
$965.0 million for permanent work projects in Puerto Rico and the
USVI--including about $377.7 million in Puerto Rico and $587.3 million
in the USVI. These projects focused on the restoration of disaster-
damaged infrastructure or systems. For example, under category C, FEMA
obligated $137.6 million for projects in Puerto Rico focused on the
permanent repair of roads and bridges, such as the severely-damaged
road shown in figure 7 below.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
In addition, under category E, FEMA obligated $39.2 million and
$67.7 million for projects in Puerto Rico and the USVI, respectively,
focused on repairing and rebuilding damaged public buildings and
equipment, such as the schools shown in figure 8 below.
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
Further, under category F, FEMA obligated $504.9 million for
projects in the USVI to repair damaged utilities. Specifically, FEMA
obligated $481.8 million--or 95 percent of this total--through the
standard Public Assistance program for projects focused on territory-
wide permanent electrical distribution system repairs. This includes
replacing damaged wooden utility poles with more resilient composite
fiberglass poles that can withstand 200 mile per hour winds as well as
power transmission lines and transformers (see fig. 9).\15\
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\15\ In April 2019, we reported that the 2017 hurricanes caused
wide-spread devastation to both Puerto Rico's and the USVI's electrical
grid and that Federal agencies--including FEMA--provided both
traditional support to restore electricity in the territories as well
as unprecedented support in Puerto Rico in coordinating and assisting
with the territory's grid restoration. See GAO, 2017 Hurricane Season:
Federal Support for Electricity Grid Restoration in the U.S. Virgin
Islands and Puerto Rico GAO-19-296 (Washington, DC: April 18, 2019).
[GRAPHIC NOT AVAILABLE IN TIFF FORMAT]
puerto rico and the usvi have established recovery offices to oversee
and monitor recovery efforts
As the recipients of Federal disaster funding, Puerto Rico and the
USVI are responsible for monitoring and overseeing the Public
Assistance program to ensure it is implemented in compliance with
applicable laws, regulations, and requirements as well as FEMA policies
and guidance. To address these responsibilities, Puerto Rico and the
USVI established recovery offices to manage recovery activities and
funding, including through the Public Assistance program.
Puerto Rico's Central Office for Recovery, Reconstruction, and
Resilience Has Developed Internal Controls to Oversee Recovery
Funds
In March 2019, we reported that Puerto Rico, in accordance with
Amendment 5 to the President's disaster declaration, established the
Central Office for Recovery, Reconstruction, and Resilience (COR3) to
oversee Federal recovery funds.\16\ We also reported that COR3 was
developing an internal controls plan to help ensure better management
and accountability of the funds.\17\ According to FEMA officials, FEMA
instituted a manual reimbursement process due to Puerto Rico's
financial situation, weaknesses in internal controls, and the large
amount of recovery funds, among other things, to mitigate risk and help
ensure financial accountability. However, from our on-going work on
Puerto Rico's disaster recovery efforts, we have learned that, on April
1, 2019, FEMA removed the manual reimbursement process and began a
transition to allow the central recovery office to take responsibility
for the review and reimbursement approval of Federal recovery funds.
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\16\ Puerto Rico; Amendment No. 5 to Notice of a Major Disaster
Declaration, 82 Fed. Reg. 53,514 (Nov. 16, 2017).
\17\ GAO-19-256.
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We have also learned from our on-going work that, in March 2019,
COR3 released the Disaster Recovery Federal Funds Management Guide.
Among other things, the guide outlines COR3's roles and
responsibilities and the internal controls COR3 put in place to oversee
the recovery. For example, COR3 will identify, procure, and administer
all Federal, territorial, and private resources available to Puerto
Rico related to recovery. In addition, it will provide oversight of
subrecipients using risk-based monitoring, offer technical assistance,
and advise Puerto Rico's governmental agencies and municipalities
regarding any matter related to recovery. COR3 continues to update its
on-line transparency portal intended to provide a breakdown of FEMA
Public Assistance and other Federal funding obligated for disaster
recovery in Puerto Rico.
The USVI Established the Office of Disaster Recovery to Monitor and
Oversee Recovery Efforts
According to our preliminary observations, in February 2019, the
USVI established the new Office of Disaster Recovery. This office
serves as the primary territorial agency responsible for overseeing all
disaster recovery efforts and funding in the territory, and coordinates
across all USVI governmental agencies and other pertinent entities.\18\
According to USVI officials, following the 2017 hurricanes, key USVI
agencies did not have enough employees with the knowledge and expertise
necessary to staff recovery-related positions and effectively manage
the implementation of recovery efforts. To address this challenge in
the short term, the USVI government hired two contractors in December
2017--Witt O'Brien's, LLC and Ernst & Young Puerto Rico, LLC--to assist
the territory in planning, developing, implementing, and overseeing
Public Assistance program projects, among other responsibilities. The
director of the Office of Disaster Recovery told us that while
contractor personnel had been valuable in augmenting the USVI's
management capacity in the short term, the territory's longer-term
vision included the establishment of the Office of Disaster Recovery to
centrally manage all aspects of Federal recovery in the territory.
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\18\ Prior to the Office of Disaster Recovery's establishment in
February 2019, the U.S. Virgin Islands Territorial Emergency Management
Agency was responsible for managing and overseeing the implementation
of Federal recovery programs in the USVI, including the Public
Assistance program.
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Among other things, the Office of Disaster Recovery is responsible
for taking on the USVI's monitoring and oversight responsibilities for
the Public Assistance program in the long term. This includes tracking
and reporting on the progress of projects and overseeing reimbursement
requests for completed work to ensure compliance with applicable laws
and FEMA policies. As of March 2019, the director of the Office of
Disaster Recovery told us the priority is to quickly hire and train
qualified individuals to staff the new agency. FEMA officials in the
USVI stated that the establishment of the Office of Disaster Recovery
and the USVI's on-going efforts to hire local residents into recovery-
related positions represented a positive step forward in increasing the
territory's capacity to oversee recovery efforts. We will continue to
review the monitoring and oversight of recovery efforts in Puerto Rico
and the USVI in our on-going work.
public assistance challenges remain in puerto rico and usvi, however
fema has taken some actions to improve program implementation
Our prior and on-going work highlight the challenges with
implementing the Public Assistance program--and the alternative
procedures--in Puerto Rico and the USVI. In particular, our prior and
on-going work have identified challenges related to: (1) The clarity of
FEMA's guidance for the Public Assistance program, (2) the time and
resources needed to transition to FEMA's new Public Assistance program
delivery model in Puerto Rico, (3) the implementation of flexibilities
provided by the Bipartisan Budget Act of 2018, and (4) developing
fixed-cost estimates. FEMA has taken some actions, including issuing
additional guidance and developing specific training, among other
things, to improve Public Assistance implementation in Puerto Rico and
the USVI. However, it is too soon to assess their effectiveness in
addressing these issues.
Clarity of Guidance.--In March 2019, we reported that officials
from FEMA, COR3, and municipalities said they experienced initial
challenges with the recovery process, including concerns about lack of
experience and knowledge of the alternative procedures; and concerns
about missing, incomplete, or conflicting guidance from FEMA on the
alternative procedures.\19\ In addition, in our June 2019 testimony
statement we continued to report on these challenges and preliminary
observations from our on-going work indicate that these challenges
continue.\20\ For example, officials from Puerto Rico's government
agencies told us they did not feel they had sufficient guidance on the
FEMA Public Assistance program and where they did, written and verbal
FEMA guidance was inconsistent or conflicting. For instance, officials
from one agency expressed their desire for more FEMA guidance
communicated in writing as FEMA officials would frequently interpret
existing guidance differently. Similarly, officials from two agencies
described situations where they had initially been directed to follow
one interpretation of a policy, only to be directed to follow a
different, conflicting interpretation in the subsequent months. Puerto
Rico agency officials also stated that the lack of sufficient
instruction led to a ``back and forth'' with FEMA for clarifications,
which led to delays in the phases of project development. For example,
officials from one Puerto Rico government agency stated that
conflicting verbal instructions from several FEMA officials contributed
to delays in opening the bidding process for recovery-related
contracts. FEMA officials in Puerto Rico stated that the agency has
developed specific guidance for disaster recovery in Puerto Rico and
that there are various ways, such as in-person meetings, where
officials from Puerto Rico can obtain clarification. FEMA officials
also reported that they developed additional training for new FEMA
employees. We are continuing to examine this issue as part of our on-
going review of Puerto Rico's recovery.
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\19\ See GAO-19-256.
\20\ GAO, Emergency Management: FEMA Has Made Progress, but
Challenges and Future Risks Highlight Imperative for Further
Improvements, GAO-19-594T (Washington, DC: Wednesday, June 12, 2019).
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FEMA's new delivery model in Puerto Rico.--In May 2019, FEMA's
Federal Disaster Recovery Coordinator for Puerto Rico announced that
FEMA was transitioning to using the new Public Assistance program
delivery model in Puerto Rico beginning on June 3, 2019. Among other
things, the implementation of the new delivery model establishes a new
Consolidated Resource Center in Puerto Rico to support grant
development for disaster recovery across all recovery sectors and
geographic branches.\21\ Following the hurricanes, FEMA implemented a
program delivery model developed specifically for Puerto Rico which
included, among other things, a sector-based approach which coordinated
recovery resources across the Federal interagency, private sector, and
nongovernmental organizations to identify and complete proposed work.
According to FEMA officials, the decision to transition from the
initial delivery model to the new delivery model in Puerto Rico was due
to improvements made since its Nation-wide deployment in 2017. In
response, COR3 officials raised concerns about the scope of the changes
and potential challenges with the amount of time and resources needed
to transition to the new delivery model.
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\21\ In 2015, FEMA awarded a contract for program support to help
Public Assistance officials implement a redesigned Public Assistance
program, known as the new delivery model. This included a new process
to develop and review grant applications, and obligate program funds to
States affected by disasters; new positions, such as a new program
delivery manager who is the single point of contact throughout the
grant application process; a new Consolidated Resource Center to
support field operations by supplementing project development,
validation, and review of proposed Public Assistance project
applications; and a new information system to maintain and share Public
Assistance grant application documents.
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The Bipartisan Budget Act of 2018.--We reported in June 2019 that
in both Puerto Rico and the USVI, FEMA and local officials have
reported challenges with the implementation of the flexibilities
authorized by section 20601 of the Bipartisan Budget Act.\22\ This
section of the Act allows for the provision of assistance under the
Public Assistance alternative procedures to restore disaster-damaged
facilities or systems that provide critical services--such as medical
and educational facilities--to an industry standard without regard to
pre-disaster condition.\23\ Officials from Puerto Rico's central
government stated that they disagreed with FEMA's interpretation of the
types of damages covered by section 20601 of the Bipartisan Budget Act
of 2018. In response, FEMA officials in Puerto Rico stated they held
several briefings with Puerto Rico's central recovery office to explain
FEMA's interpretation of the section.\24\ In addition, FEMA officials
in the USVI told us that initially, they had difficulty obtaining
clarification from FEMA headquarters regarding how to implement key
components of section 20601 of the Act. Further, USVI officials stated
that at times, the appropriate process for implementing components of
the Act was not clear and that ensuring program participants understood
its key components was difficult. However, FEMA officials in the USVI
stated that they continue to move forward with developing alternative
procedures projects. USVI officials also told us that FEMA had been
responsive and helpful in identifying its options for using the new
flexibilities the Act provides.
---------------------------------------------------------------------------
\22\ GAO-19-594T.
\23\ The Bipartisan Budget Act of 2018 authorized FEMA, when using
the Public Assistance alternative procedures, to provide assistance to
fund the replacement or restoration of disaster-damaged infrastructure
that provide critical services to industry standards without regard to
pre-disaster condition. Pub. L. No. 115-123, 20601(1), 132 Stat. 64
(2018). Critical services include public infrastructure in the
following sectors: Power, water, sewer, wastewater treatment,
communications, education, and emergency medical care. See 42 U.S.C.
5172(a)(3)(B). Section 20601 applies only to assistance provided
through the Public Assistance alternative procedures program for the
duration of the recovery for the major disasters declared in Puerto
Rico and the USVI following Hurricanes Irma and Maria. Further, the
Additional Supplemental Appropriations for Disaster Relief Act of 2019,
which was signed into law on June 6, 2019, provides additional
direction to FEMA in the implementation of section 20601. Pub. L. No.
116-20, tit. VI, 601, 133 Stat. 871, 882 (2019). For the purposes of
our report, discussion of the Bipartisan Budget Act of 2018 refers
specifically to section 20601.
\24\ In September 2018, FEMA issued guidance for implementing
section 20601 of the Bipartisan Budget Act of 2018 through the Public
Assistance alternative procedures program.
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Developing Fixed-Cost Estimates.--Preliminary observations from our
on-going work indicate that as of May 2019, FEMA had obligated funding
for 4 alternative procedures program projects in Puerto Rico and 2
projects in the USVI. FEMA officials in Puerto Rico and the USVI stated
that the on-going development of a ``cost factor'' for use in the
fixed-cost estimating process has slowed the pace of FEMA obligations
for permanent work projects. Specifically, these factors are intended
to ensure that the costs associated with implementing projects in
Puerto Rico and the USVI are sufficiently captured when developing the
fixed-cost estimates for alternative procedures projects. Since
incorporating the cost factor into the fixed-cost estimating process
will increase the amount of funding obligated for any given permanent
work project, FEMA officials explained that Puerto Rico and the USVI
have an incentive to delay the obligation of individual projects until
this factor is finalized. For example, FEMA officials in the USVI told
us in May 2019 that obligations for permanent work projects in the
territory were mostly on hold until the USVI-specific cost factor was
finalized. As of June 2019, the cost factors for use in both Puerto
Rico and the USVI had not yet been finalized.
According to FEMA guidance, the Puerto Rico-specific cost factor is
being developed by a third-party center of excellence comprising
personnel selected by FEMA and Puerto Rico, through COR3.\25\ In March
2019, we reported that while FEMA had identified and chosen personnel,
COR3 had not yet finalized its hiring of personnel to staff the center
of excellence, which resulted in delaying the cost estimation
process.\26\ Through our on-going work we learned that, as of June
2019, COR3 had identified and hired personnel to staff the center;
however, FEMA and COR3 have not come to agreement on a cost estimation
approach. Further, according to FEMA officials, no time line has been
established for the completion of the center of excellence's standard
operating procedures for developing fixed-cost estimates for permanent
work projects in Puerto Rico. In addition, according to FEMA officials,
the USVI-specific factor is being developed by an independent
contractor. FEMA officials told us that territorial officials disagreed
with the initial cost factors this contractor proposed and contended
the factors were insufficient in accurately capturing the unique
circumstances that influence construction costs in the territory, such
as the limited availability of local resources and the need to import
materials and labor. As of June 2019, these officials told us the
contractor was developing a third and final cost factor for potential
incorporation into the fixed-cost estimation process in the USVI.
Despite these delays, FEMA officials in the USVI stated that they
continue to work with territorial officials to develop alternative
procedures projects in the territory. They added that once the cost
factor is finalized and incorporated into FEMA's fixed-cost estimating
process, FEMA and the USVI will be well-positioned to quickly finalize
these projects and obligate funding. However, we reported in June 2019
that the territory plans to take a cautious approach in pursuing
permanent work projects using the Public Assistance alternative
procedures program. Specifically, USVI officials we interviewed told us
that developing fixed-cost estimates for alternative procedures
projects that accurately incorporate the future impact of inflation and
increases in materials and labor costs for certain projects was
difficult. Further, these officials stated that since the territory is
financially responsible for any costs that exceed these fixed-cost
estimates, the USVI plans to pursue alternative procedures projects
that do not include high levels of complexity or uncertainty to reduce
the risk of cost overruns, especially given its already difficult
financial situation.\27\
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\25\ According to FEMA guidance, as part of the alternative
procedures process in Puerto Rico, FEMA and Puerto Rico must agree on a
group of personnel with cost estimation expertise who will serve as
part of a center of excellence.
\26\ GAO-19-256.
\27\ Under the standard Public Assistance program, FEMA will
reimburse the USVI for the actual cost of completed work for any given
project.
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As established in FEMA guidance, Puerto Rico's deadline for
finalizing fixed-cost estimates for permanent work projects using the
alternative procedures--and the Bipartisan Budget Act, as applicable--
is October 2019.\28\ Since Puerto Rico must use the alternative
procedures for all large permanent work, all fixed-cost estimates for
Public Assistance program permanent work projects in Puerto Rico must
be finalized by this date, or, according to FEMA officials, Puerto Rico
must request that FEMA extend this deadline on a project-by-project
basis. In contrast, the USVI has the flexibility to pursue either the
alternative procedures or the standard procedures on a project-by-
project basis. As the USVI's deadline for finalizing these projects is
in March 2020, it is too early gauge the extent to which the
alternative procedures will play a role in the USVI's long-term
recovery strategy.
---------------------------------------------------------------------------
\28\ FEMA, Public Assistance Alternative Procedures (Section 428)
Guide for Permanent Work FEMA-4339-DR-PR (April, 2018).
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We will continue to evaluate these identified challenges and any
efforts to address them, as well as other aspects of recovery efforts
in the USVI and Puerto Rico, and plan to report our findings in late
2019 and early 2020, respectively.
Thank you, Chairman Payne, Ranking Member King, and Members of the
subcommittee. This concludes my prepared statement. I would be happy to
respond to any question you may have at this time.
[GRAPHICS NOT AVAILABLE IN TIFF FORMAT]
Mr. Payne. Thank you, sir.
I would like to thank all the witnesses for their testimony
and remind each Member that he or she will have 5 minutes to
question the panel.
I will now recognize myself for questions.
Mr. Marrero, could you remind the subcommittee on how many
cost estimates are completed and how many need to be completed?
Mr. Marrero. Well, right now, the total amount of fixed-
cost estimates agreed with FEMA is 48. Of those, only 4 has
been obligated. So they are ready for actual work. Of the
universe, even though, initially, it was estimated between
70,000 to 90,000 sites, had a meeting 2 days ago with Jonathan
Hoyes with FEMA who is the temporary FCO. He told me that that
will be revised to 50,000. But the number--he just gave me this
2 days ago--essentially it should look around 5,000 to 7,000
projects. So, once we have those projects, we will determine if
we aggregate the fixed-cost estimate into a single PW. So we
are talking about thousands of estimates that have to be
developed and agreed by October--deadline. We only have 48
agreed, 4 of those obligated.
Mr. Payne. Thank you.
I understand that if all cost estimates are not completed
by October 2019, FEMA will evaluate whether to allow extensions
for remaining cost estimates on a project-by-project basis. Yes
or no, has FEMA shared the criteria for this review with COR3?
Mr. Marrero. They responded to our request for extension,
including a general overview of how it would be considered, and
we are already working on that. Yes, the answer is, yes, sir.
Mr. Payne. OK. Thank you.
What are Puerto Rico's options, should any cost estimates
extend--extensions be denied?
Mr. Marrero. Appeal, sir. We will have to appeal.
Mr. Payne. Let's see. By October 2019, how many cost
estimates do you predict will be remaining?
Mr. Marrero. Thousands, sir. To give you some perspective,
we have already submitted to FEMA 171 cost estimates that are
ready to be agreed and signed. Unfortunately, we are still
waiting for them to finalize. We need--right now, they haven't
finalized what they call the industry standards and the cost
factors which the cost factors are very important because those
are the factors that will determine how much it costs to
rebuild in Puerto Rico as opposed to the mainland.
So they haven't finalized that and without that, sir, we
not be able to agree on the cost estimate because we will be
running--we will be facing the risk that, within the CAP grant,
we will not be able to revise it becomes a factor. Right now,
we are talking about thousands. We are working with our team.
Right now, to give you some perspective, we already have 2,000
fixed-cost estimates being developed by our team.
Mr. Payne. OK.
Mr. Marrero. Fortunately, we are a little bit ahead than
FEMA. That is why we have been requesting to allow Puerto Rico
licensed engineers, as it happened in New York, after Sandy,
and New Jersey, to expedite the process.
Mr. Payne. OK.
Mr. Marrero. Our reasoning is, if licensed engineers are
willing to put the licenses at risk to certify the cost
estimates, that should have some weight.
Mr. Payne. Thank you.
Mr. Currie, according to information provided to the
committee from staff from FEMA in May, only 32 percent of its
Public Assistance work force are deemed qualified for the jobs.
That is really a shockingly low number. This is especially
troubling in Puerto Rico and the UVI, which are using the pilot
section 428 Public Assistance programs, which has never been
done before on this scale.
Can you discuss how the lack of qualified workers may
hinder the recovery process in the territories, and has GAO
seen FEMA do anything to address this issue specifically in
Puerto Rico and the Virgin Islands?
Mr. Currie. Yes, sir. Thanks for your question.
So we have reported on a couple of different occasions that
FEMA has been stretched thin, frankly, since the 2017
disasters. I think Mr. Gaynor at the last hearing testified
they had 600 open disasters they were managing. So that is 600
disasters they have to spread their people across to manage
response and long-term recovery. What we see happens oftentimes
in recovery is they bring in their most qualified people with
expertise and experience right after the disaster. Over time,
they transition out, and they try to rely on temporary and
local hires.
For example, in Puerto Rico, most of the work force there
is local hires now. They have hired almost 2,000 people locally
to manage the recovery. So these are people that are new to
FEMA, first of all, and are being trained on FEMA processes to
begin with, and on top of that, they are implementing these new
procedures, which they have to be retrained on and the existing
FEMA staff have to be retrained on, too, and they don't have
experience doing this because it has not been done.
So the work force challenges are a huge issue. I know the
way it plays out in recovery is that there is, a lot of times,
folks don't know what guidance to give people at the territory
level, or they give different guidance, and they have to go up
to headquarters to get a final resolution, which causes delays
after delays.
Mr. Payne. OK. Thank you.
My time has expired.
We will now have the Ranking Member, Mr. King, at 5 minutes
of questioning.
Mr. King. Thank you, Mr. Chairman.
Gentlemen, again, I want to thank all the witnesses for
your testimony.
Mr. Currie, in your testimony you pretty much laid out the
fact that Puerto Rico is unique because of its total
devastation. Now, my district on Long Island with Sandy was
very much devastated. But, again, upstate people were able to
come down and assist. Mr. Payne, I know, in New Jersey went
through it. The first week I was Chairman back in 2005, I went
to Mississippi with Chairman Thompson at the time to see the
terrible damage of Katrina. It does seem that Puerto Rico is a
different level for a number of reasons, including the lack of
infrastructure and the fact that the entire area was decimated.
So I ask these questions in that tone to try to avoid this
in the future or to mitigate future issues, and in that
context, I saw that earlier this week the IG issued a report,
saying that FEMA had reimbursed a company--I believe it was
Cobra Acquisitions--for millions of dollars in contract costs
that officials in Puerto Rico had ordered based on unsound
information. Also, just yesterday, there was a story I guess in
The Washington Post that the FBI arrested 6 people, including 2
senior officials in the Governor's administration, for
illegally directing Federal funding to politically-connected
contractors.
I am not trying to assess blame here. When you have
millions of dollars going out, things like this can happen. It
is wrong. We have to stop it. I want to know, especially
considering how weakened and inadequate the infrastructure is
in Puerto Rico, looking at the entire, looking at the totality
of contract procedures, rebuilding infrastructure, training
local officials, what position are we in if, God forbid,
another hurricane hits Puerto Rico of this magnitude anytime in
the next several years?
So, I guess, Mr. Marrero, I will go first with you and then
Mr. Currie.
Mr. Marrero. Well, thank you, sir, for the question.
First of all, since the hurricanes hit, we knew that,
because of the magnitude and the scope of the devastation, that
we will have to do things differently, that we will have to
follow best practices, that we could not reinvent the wheel.
That is why we have to make sure that we study what other
States did in the past.
I avail myself of this opportunity to thank you because of
the help of NYPA, LIPA, and the people of New York that helped,
myself, one of the first trips I did after the hurricane was to
meet with Governor Cuomo and his staff and see how we could
learn of the lessons learned that you had after Sandy. By the
way, what we did was that we created a centralized oversight
authority. We designed the controls, the policies based on the
ERP, which are quite strict. We made sure we had stricter
controls. We made sure that we brought technology. Actually,
the technology that we are using, it was used in New Jersey
after Sandy, the disaster recovery system. That is the only
system that has been used for this scale of disaster. It
brings, not only visibility, transparency, and accountability
and, most importantly, sir, has supported many, many audits.
So what I am trying to say is, since Day 1, we knew this
would be one of the most audited process in the Nation, and
that is why to make sure that not only we--the money flows to
the people it has to go, we want to make sure that we can
reciprocate the commitment of the Federal Government with
transparency, accountability, and full compliance. That is what
with have done. That is why we feel we are in a better position
that, if that something happens tomorrow, we not only are we
going to be able to withstand the impact once again because, as
the USVI and Puerto Rico, we are resilient, but we will make
sure we are able to bounce back in a quicker fashion because we
have the structure, we have the policies, we have the
knowledge, and we are collaborating with the Federal agency to
make sure that we fine-tune and any tweaking we have to do to
make sure we have the best controls in place, we will do that.
Mr. Currie. Yes, sir. From a response perspective, I mean,
I am very concerned about still about if a large-category
hurricane hit Puerto Rico again because, as we talked about,
the permanent work repairs have not been done yet. So the
repair to the electric grid, for example, has not been done. So
those things would happen again. I think the difference is----
Mr. King. Who is going to do that?
Mr. Currie. Well, who is going to repair the
infrastructure?
Mr. King. Yes.
Mr. Currie. Well, I think--well, eventually it is going to
be done, Puerto Rico is going to do it using FEMA dollars,
Federal public assistance dollars. So hopefully we don't have
another situation like that before that stuff can be rebuilt in
a resilient way.
I think the unfortunate side effect when one of these large
disasters happen--and every State represented here knows this--
is that everyone company gets pretty familiar and pretty good
at managing recovery and managing these programs.
So I do have a lot more confidence, if something like this
happens, that Puerto Rico would be in a much different position
in terms of their ability to manage the response and the
recovery. But they are still going to need extensive Federal
support if another large hurricane or earthquake was to happen.
Mr. King. Thank you.
Mr. Chairman, if I may just ask unanimous consent to
introduce into the record for the American Maritime
Partnership.
Mr. Payne. Without objection.
[The information follows:]
Statement of the American Maritime Partnership
July 11, 2019
hurricane maria and puerto rico
Jones Act Industry Relief Efforts
The Jones Act fleet has been essential to the recovery effort in
Puerto Rico. In the immediate aftermath of Hurricane Maria, Jones Act
carriers promptly delivered thousands of containers of relief and
commercial cargoes. (Unfortunately, due to damaged surface
infrastructure, many of those cargoes could not move inland promptly).
Jones Act carriers also added vessels beyond their regular service,
staged critical supplies in San Juan for immediate delivery when the
port reopened, and acquired additional containers and chassis to
support increased deliveries to the island. In the 6 months after
Hurricane Maria, Jones Act carriers delivered well over 100,000
containers of cargo, including infrastructure materials essential for
rebuilding and repairing damaged bridges, roads, and the electrical
grid.
There is wide-spread agreement that the Jones Act did not impede
the Puerto Rico recovery effort. The U.S. Committee on the Marine
Transportation System, an interagency group, highlighted the
``reliability of U.S. domestic shipping services despite the worst of
conditions'' while FEMA called the response ``the largest sea-bridge
operation of Federal disaster aid in FEMA history.'' Jones Act carriers
continue to be dedicated to the needs of Puerto Rico--Jones Act
carriers provide reliable, regular service to the island and the
carriers have invested more than $1 billion to support their operations
there, including building 4 new LNG-powered container ships
specifically for the Puerto Rico trade.
Mr. Payne. The Chair now recognizes the gentleman from
Mississippi, the full committee Chair, Mr. Thompson.
Mr. Thompson. Thank you very much.
Mr. Currie, based on your analysis, do you think FEMA's
decision to change its policy for a fixed-cost estimate added
to Puerto Rico and the Virgin Islands' dilemma?
Mr. Currie. I think the decision to use the alternative
procedures on such a large scale has had a massive impact on
the speed of the recovery and has slowed that.
Mr. Thompson. And that--well, you answered it.
Mr. Marrero, the hospital at Vieques.
Mr. Marrero. Yes, sir.
Mr. Thompson. Just tell me the status of it.
Mr. Marrero. It is as you saw it. It is as Maria destroyed
it. We are still waiting for the permanent work to be made. So,
right now, the 10,000 residents of the island of Vieques are
still receiving medical treatment in temporary facilities. We
just got 2 days, a couple--2 days ago the final determination
memo or determination letter from FEMA that they have finally
decided that this hospital entails a full replacement
particularly because of the BBA fix that this hallowed body
approved. So thank you for that. However, they haven't
finalized the cost factors. So we don't have a cost estimate.
So, right now, we don't know much.
Mr. Thompson. So, for 2 years almost, they have been
without health care. Now, is it FEMA's problem? Or is it Puerto
Rico's problem, the reason that people don't have the health
care they need?
Mr. Marrero. I think it is an American problem, sir. I
think that we both have the responsibility to make sure. We
believe that we have----
Mr. Thompson. Is it an American FEMA problem or American
Puerto Rico problem?
Mr. Marrero. Sir, yes, sir. That at the time way I--we are
in this together. We believe that we have provided every single
document and every single cost estimate since Day 1. We had an
estimate, original estimate, within 2 months after the
hurricane. Unfortunately, it was now that FEMA just took the
decision because initially it was cleared----
Mr. Thompson. I am just trying to get the folks health care
on the island.
Mr. Marrero. Yes, sir.
Mr. Thompson. That is all.
Mr. Marrero. I thank you for that.
Mr. Thompson. Ms. Williams, I am going call you Ms.
Williams. I can't read that other name.
You got a problem with medical care on Saint Croix.
Ms. Williams-Octalien. Yes, we do.
Mr. Thompson. So explain that problem to me as to why of,
after all this time, we are still without it.
Ms. Williams-Octalien. So we have received--it is number of
issues, one being the cost escalation factors are necessary for
us to determine the fixed-cost estimate. That allows us to move
forward by getting the funds obligated. We have a problem where
we are currently in the damaged building. Our temporary
facilities are not up because the fixed--the furniture,
fixtures, and equipment were not included in the PW. Therefore,
we are not using the temporary facilities as well. So we have--
--
Mr. Thompson. So you got----
Ms. Williams-Octalien [continuing]. No resolution at this
point.
Mr. Thompson. So, Mr. Currie, is this a sampling of the
problem we just talked about in my first question?
Mr. Currie. The hospital in Saint Croix, which we have been
to and I think we displayed some pictures of, is a perfect
example of one large, complicated permanent work project and
all the complexity that goes into it. It is just one out of
thousands.
Mr. Thompson. Uh-huh. But also it is because of the new
policy that FEMA decided to implement.
Mr. Currie. Yes, well, it is multiple things, but at both
levels, yes. It is confusion in the steps that are necessary as
part of the new program to get to a fixed-cost estimate before
work can actually begin.
Mr. Thompson. OK. So, I think the committee is concerned
about how long it has taken to get to this point with so little
actually in some of our minds being done. I went through
Katrina, and I saw, well, a system like ours that at times we
built the capacity and started moving. I am not convinced at
this point that we are anywhere near a capacity in Puerto Rico
or the Virgin Islands.
Have you made some assessment of where you think they
should be at this point?
Mr. Currie. We haven't assessed that. It is really
difficult for us to compare disaster to disaster, but I will
tell you this. So, in other States, where the traditional
public system's model is used, they estimate--they go project
by project basically which in some ways is easier because you
are just doing one project, approving it, and moving on. The
goal of going to this process was to wrap all of this up
together to try to get to general agreement. So, years down the
road we are not going back and forth because, as you know, they
are still obligating projects in Mississippi and Louisiana
after Katrina. So that was the goal.
So I don't think the goal was wrong to try to make this
more efficient. The problem is, is no one has done this before.
Then you overlay this on top of recovery, both of these places,
that is more complicated than any recovery in our history.
Mr. Thompson. Let me give a good example. We talked to a
number of mayors in Puerto Rico, and they are challenged
because they don't have the money to front the cost. So they
are kind-of in a Catch-22 situation, and they are saying: Look,
we just need to get city hall fixed and the streets fixed and
some other things, but the process is so cumbersome, and now
they are requiring two evaluations or inspections of the same
project. That duplication of effort is just adding to the load.
But this is part of what I think we have to eventually get
to FEMA that this probably was not a wise choice to implement
this in a situation so far away from the mainland.
I yield back, Mr. Chair.
Mr. Payne. Thank you, Mr. Chairman.
The Chair now recognizes the gentleman from Texas, Mr.
Crenshaw.
Mr. Crenshaw. Thank you, Chairman Payne and Ranking Member
King, for holding this hearing.
Thank you all for being here.
As a Representative of Kingwood, Spring, and Houston, I am
also familiar with hurricanes and the struggles of disaster
recovery. As we meet today, the Gulf Coast is bracing for rain
and wind of what will likely become Hurricane Barry.
In 2017, Hurricane Harvey devastated many of the
communities I represent. We continue to rebuild and guard
against future events through mitigation efforts. In Texas, we
proactively approached some of the problems we frequently faced
in disaster recovery. As a response transition to recovery,
Texas Governor Greg Abbott appointed Texas Land Commissioner
George P. Bush to be the lead for State efforts in coordination
with FEMA on short-term disaster housing. Then, in my limited
time, I want to focus on housing.
In a recent political article, Commissioner Bush
highlighted a few of the issues he encountered. I ask unanimous
consent to enter into the record this article from Politico
entitled ``What We Learned in Texas After Harvey.''
[The information referred to follows:]
Article Submitted For the Record by Honorable Dan Crenshaw
What we learned in Texas after Hurricane Harvey
7/11/2019, POLITICO, The Agenda
By GEORGE P. BUSH / 07/02/2019 05:05 AM EDT
Texas Land Commissioner George P. Bush has two fixes Washington
should make before the next superstorm.
The 2019 hurricane season in the Atlantic is underway and with it
brings the threat of dangerous winds, storm surges and flooding to many
coastal States. But hurricanes are not the only natural disasters that
devastate American communities. President Dwight D. Eisenhower issued
the first Federal disaster declaration in 1953 after a tornado
devastated four counties in Georgia. Since then, more than 4,000
disasters have received this designation. This year, 44 Federal
disaster declarations have been issued for 26 States and one U.S.
territory. Since June 1, Louisiana, South Dakota, North Dakota, Idaho
and Vermont have all received major disaster declarations. Responding
to and recovering from disasters concerns everyone elected to protect
and serve others.
But as I discovered leading the housing assistance mission after
Hurricane Harvey, even though we are a nation of innovation, the
Federal disaster recovery process remains outdated, cumbersome and
costly.
Hurricane Harvey was the second-largest storm in U.S. history, and
it devastated my home State of Texas. About 30 percent of Texans were--
directly affected, and more than 750,000 people evacuated their homes.
The scale of the disaster recovery was made even worse by the fact that
two other major hurricanes struck American territory within 39 days:
Harvey was followed 5 days later by Irma hitting Florida and then Maria
decimating Puerto Rico.
I was in Houston mucking out homes with a group of military veteran
volunteers, when I got a call from Texas Gov. Greg Abbott. The Governor
said he was tapping me and my agency, the Texas General Land Office, to
partner with the Federal Emergency Management Agency on the short-term
disaster housing mission. Traditionally, FEMA had sole responsibility
for temporarily housing displaced residents, but the scale of this
disaster was enormous. In addition to the deadly storms, wildfires
burned more than half-a-million acres of California in 2017. With
available Federal recovery resources stretched extremely thin, this
operation called for more direct oversight at the State level and we
were eager to serve. For the first time in history, a State agency
would partner with FEMA in carrying out a disaster housing mission.
Over the next 2 years, my State agency and FEMA would help more than
60,000 Texans return home after the storm through assistance programs
that provided both temporary housing units and repairs.
As I tackled this new mission, I quickly encountered two problems
that impeded the short-term recovery process.
FIRST. WE LEARNED that Federal law limits FEMA to providing
``temporary'' and travel trailers predominantly used by FEMA after
natural disasters are extremely costly. After purchasing the unit,
transportation, installation, recertification, other administrative
costs, disconnection and removal, the costs per unit typically incur
between $125,000 to $200,000.
A plethora of alternative housing options are available now that
were not on the market when the Stafford Act passed in 1988, replacing
the Disaster Relief Act of 1974. Some of these innovative housing
solutions were developed in Texas, where we have a history of repeat
disasters such as hurricanes, tornadoes, wildfires and floods. These
options include stackable shipping containers, small modular homes and
expandable ``core unit'' housing utilized under an initiative called
RAPIDO, a temporary-to-permanent housing strategy that provides a safe,
``core'' home that is customizable to meet the family's needs for about
$60,000. Owners can add on to these units as needed later on. An
Austin-based 3D home technology company, ICON, can print sturdy, 600-
to 800-square-foot homes in less than 24 hours for $4,000. These homes
can be placed quickly and left permanently for a fraction of the cost
of a temporary FEMA trailer. They can also withstand subsequent
hurricane or flooding events.
Even though many of these innovative options are cheaper, more
durable and quickly deployable, ``permanent'' housing is ineligible
under the Stafford Act. The manufactured housing units and travel
trailers traditionally utilized by FEMA sit on axles, meaning you can
haul it away after use--therefore passing the ``temporary'' housing
test. After use, FEMA refurbishes former temporary housing units in
good enough condition and the General Services Administration auctions
them off, but typically for a small fraction of their cost. We can
agree that the current disaster recovery process is not cost-effective.
SECOND, FEDERAL LAW prevented coordination with local officials to
help displaced residents. With nearly 1 million applications for FEMA
assistance submitted, county judges, mayors and other local leaders
asked repeatedly for information on who needed help. FEMA controlled
the application process and provided my team the names of only those
deemed eligible for short-term disaster housing assistance. The Federal
assistance application process is daunting. It requires survivors to
submit the same onerous application whether they need simple financial
assistance, a small business loan, or short-term housing. Further, we
had no information on who was found ineligible; therefore, community
leadership had no ability to explain to constituents why.
Additionally, we were prohibited by the Federal Privacy Act of 1974
from providing any ``personally identifiable information'' of eligible
applicants to anyone outside the program. Local leaders trying to
coordinate volunteer groups and potentially distribute donated
resources were baffled by the unnecessary barriers to helping survivors
at a time when expediency was critical. County judges and mayors from
affected areas all along the Texas coast, such as Rockport/Fulton,
Kingwood, Dickinson, Port Arthur and more, were calling me daily asking
for help connecting those who needed help with the volunteer
organizations that were showing up on the doorsteps of their county
courthouses and city halls. I personally attended more than a hundred
hearings, briefings, meetings and events in affected communities to
relay information and answer questions, but I couldn't provide a simple
list of names and phone numbers for those needing help. During this
time of crisis, Federal privacy laws choked the flow of information and
recovery resources to those in need and there was nothing those of us
on the ground could do to fix it.
There are two relatively easy steps Federal leaders could take to
drastically improve the short-term disaster housing mission:
1. Congress should amend the Stafford Act to remove the word
``temporary'' from the requirements, therefore allowing cost-effective,
permanent resources to house displaced residents.
2. FEMA should amend the application for assistance to allow people
to voluntarily make their data available shareable with their State and
local government authorities.
The lessons Texas learned in the aftermath of Hurricane Harvey can
help all States facing natural disasters. Congress should learn these
lessons from Texas now, before catastrophic events hit Americans in
other parts of the country. On the 1-year anniversary after landfall, I
released a lessons-learned report, Hurricane Harvey: Texas at Risk,
with policy recommendations for local, State and Federal officials to
improve the disaster recovery process.
We can't stop natural disasters from happening, but we can innovate
the way in which we respond and rebuild.
George P. Bush is commissioner for the Texas General Land Office, the
State agency tasked with leading the disaster recovery housing
mission after Hurricane Harvey, the second-most destructive
storm in American history.
Mr. Crenshaw. I want to focus today on the limitations of
providing only temporary solutions. These are usually travel
trailers because their axles and wheels make them temporary,
and they fit FEMA's criteria. In my view the focus on temporary
housing without consideration for long-term benefits wastes
taxpayer dollars. On the one hand are these trailers which
carry an incurred unit cost of $125,000 to $200,000. On the
other hand, we actually have more modern solutions, more cost-
effective solution. I brought some of those solutions with me
today. It is like show and tell.
One solution is a 3D-printed structure. It is quick. This
600-, 800-square-feet structure can be made in less than 24
hours. It is permanent, water- and corrosive-resistant and
cost-effective, sometimes as little as $4,000 per unit. There
is a company called Genesis Dimensions in Houston that makes
these things. I think they pull a truck out there. All of a
sudden are you creating a strong structure.
If FEMA is still required to abide by the conditions of the
1988 Stafford Act, when 3D printing, small modular homes, and
expandable, core unit housing wasn't a reality, these
developments could be temporary to permanent transition options
for families devastated by the storms, looking to return to
some sense of normalcy, if we allow it.
So, in Houston, our recovery has been incredibly
frustrated, as yours has, by such restrictions and unnecessary
and unreasonable burdens. In my limited time, that is what I
want to get at both for Mr. Marrero and for Ms. Williams.
Can you speak to the policies and rules specifically
dealing with FEMA that slowed or hindered efforts when trying
to provide short- and long-term housing solutions?
Ms. Williams-Octalien. Well, one of the very first issues
that we have had was the STEP program where the lack of
guidance in the beginning of the program has us to a point
where our contractors are unable to be paid on a timely basis
when we consistently ask for clarifications within the PWs.
Therefore, it would guide exactly how we would administer the
program. We continue to have those kinds of assistant issues.
We also have issues we the lack of capacity and resources
there to manage the STEP program and housing in general where
the FEMA resources on the ground were very unfamiliar with the
building technologies and the construction processes in the
Virgin Islands, and we spent an inordinate amount of time going
back and forth on how do we build resiliently here in the
territory.
Those concerns continue to hamper us as we get to this
point where we still have over 3,000 families that are without
permanent housing for our upcoming storm season.
Mr. Marrero. I will only to add the fact that, even though
we were able to deliver what has been the largest temp program
in the Nation, it was--we spent $1.2 billion, along with FEMA,
and we helped 108,000 families. Unfortunately, it was just
temporary repairs. Even though we requested permanent
reconstruction homes during the emergency phase as it was done
in Louisiana, because we thought it would make sense to make
sure that people were able to have a not only safe place to
protect their family but in order to weather the storm.
Unfortunately, that was denied. So, that was why we would only
end up with temporary fixes with houses.
Today, we still have 20,000 homes with blue tarps. We still
have 20,000 families waiting for a decent housing solution.
What we are going to do is that we are going to use the CDBG
funding that is already available to help them repair in a
final way and in a permanent way their homes. But definitely
the policies and the restrictions and the denials to several
requests that we made during the response phase. Unfortunately,
it was the reason why today we still have many families
without.
Mr. Crenshaw. If I may conclude, you know, in Texas, we
have a very long lessons learned report from the GLO office, as
I think both Puerto Rico and the U.S. Virgin Islands have
recently set up these coordination offices to deal with
disaster recovery in particular. I hope we can expect a very
detailed lessons learned report so that we can fix a lot of
these issues going forward.
Thank you.
Mr. Payne. Thank you.
The Chair now recognizes the gentlelady from New York, Ms.
Yvette Clarke.
Ms. Clarke. Thank you very much, Mr. Chairman.
I thank our Ranking Member.
I thank our panelists for bringing your expertise to bear
today. As a Member of the subcommittee and the co-chair of the
Congressional Caribbean Caucus, I have been dismayed by the
White House's response to Irma and Maria. We all remember how
the President demeaned Puerto Rico on Twitter.
Today, the White House has added insult to injury. When
this subcommittee asked FEMA to testify about their response to
hurricanes in Puerto Rico and the USVI, they refused to even
send a witness. This hearing isn't the first time that FEMA has
refused to show up. When Irma and Maria made landfall, FEMA
also didn't show up. They weren't prepared.
Though the storms were nearly 2 years ago, the recoveries
for Puerto Rico and the U.S. Virgin Islands essentially are
still and remain at a beginning stage. We are talking to the--
we are talking about U.S. citizens here, and we cannot allow
our fellow Americans to languish any longer.
Having said that, I find it interesting that just about
everyone who sat on this panel today have had and have been
victims of hurricanes, extreme weather events. It would seem to
me that, given the decades-long experience that we have had
with this, that there would be some level of best practices.
There would be some level of adjustment and modification of
policy and procedure that enables us to expedite things. I
don't adhere to the idea that, oh, this is new. It is a new
environment, but it is not new in terms of what has taken
place.
So I would like to ask Mr. Marrero and Ms. Octalien, as we
enter the heart of hurricane season once again, another storm
could hit both Puerto Rico and the U.S. Virgin Islands at any
time. Not only could another hurricane devastate the islands,
but it could set back existing recovery efforts.
If another hurricane were to strike your territories
tomorrow, do you believe that the administration has set aside
the necessary resources to ensure that we do not see a repeat
of what has occurred previously?
Ms. Williams-Octalien. Well, one of the very first things
that we must acknowledge is that we have really built some
capacity in our understanding. The lessons that have been
learned from Irma and Maria, there was never a time where we
believed that, on our islands or in our region, that the entire
region would be wiped out, because we normally help each other.
We are at the point now where we have built in a lot of the
practices, but our infrastructure is so vulnerable that, if we
are hit with another storm, we will know what to do, but it
will still cost a lot because we are not ready with our
infrastructure because a lot of the permanent work has not been
done. Everything is temporary. Everything is bandaged up, and
we are just very fragile.
Mr. Marrero. I will definitely have to second that, ma'am.
That is our biggest fear. This is the second hurricane season
that we are entering, both USVI and Puerto Rico, the second
hurricane season without no permanent work being done. So
landslides that were created by the storm are still waiting to
be fixed. Roads waiting to be fixed. Schools, that are shelter
of last resort for the most vulnerable families in Puerto Rico,
are still waiting to be rebuilt.
Not only that, we are prone to earthquakes as well. So we
think that, without getting into the debate of climate change,
but the reality is that we are facing more frequent and
stronger natural disasters. So that is our biggest fear, ma'am.
If something happens, even though we have made some progress--
and, as I agree with Ms. Williams, we are resilient and we will
help each other, as we have done in the past and we will do it
every single day, the same way that we did after Irma. When
many American citizens needed to return to the mainland, we
served--from Puerto Rico, we opened our doors without thinking
that we were in the middle of a fiscal and economic crisis. We
helped them because that is what we could. Unfortunately, that
is our biggest fear. If something happens, we have to be fully
cognizant that the challenge will remain pressing.
Ms. Clarke. Very well. Can you discuss the disparities
between how Puerto Rico and the USVI have been treated, in
terms of recovery funding, compared to other places that have
been hit by hurricanes? Have you been able to do that analysis?
Ms. Williams-Octalien. Well, there are some concerns that--
I am not sure if we can actually substantiate them, but we are
concerned that the fact that we do not have the money. Typical
States are able to pay for all of their work and then fight
with FEMA for reimbursement if there is any discrepancy. We are
unable to do that because we cannot pay for millions or
billions of dollars' worth of projects up front; and if there
is a concern, then we spend months fighting back and forth with
FEMA.
So we are very, very vulnerable. We are unable to move a
lot of our projects forward because we do not have the cash. I
think on that level, then we--and there are some concerns with
our financial solvency that we are not given the benefit of the
doubt.
Ms. Clarke. Absolutely.
Ms. Williams-Octalien. I think we are not given the benefit
of the doubt upfront. I think there are just some concerns that
going right off the bat that we are doing things illegally or
there is some cloud of wrongdoing. That is not where we wanted
to be. We want to be given the benefit of the doubt that we are
doing everything that we need to do to manage our Federal
funding, and that way we can move our projects forward.
Ms. Clarke. Very well. I accept what you have said.
Mr. Chairman, I yield back. Thank you.
Mr. Payne. I thank the gentlelady. It is pretty interesting
how in dealing with the territories and attempts through this
Nation to support, while these are Americans, but any type of
aid, that there is some suspicion always around them receiving
funding. So I find that interesting. I remember a little
company in the early 2000's by the name of Halliburton that did
pretty well around the world in terms of getting contracts and
what have you, but that is another day.
It also would have been great if FEMA was here, a clear
example of the questions that Mr. Crenshaw posed to be here to
help. But here we are.
The Chair now recognizes the gentleman from Texas, Mr.
Green.
Mr. Green. Thank you, Mr. Chairman.
I thank the witnesses for appearing.
I thank the Ranking Member as well.
Mr. Chairman, FEMA's absence from this hearing is further
evidence of how the chief executive officer of the United
States, how the President has corrupted the political process.
I say this after having given much thought to it because we now
see that the President has encouraged witnesses not to appear
before other committees. He has encouraged persons not to
respond appropriately to subpoenas. He has refused to cooperate
himself.
This level of disrespect is contagious, and it is infecting
the body politic in the United States of America. This is not
something that we should take lightly, having a President who
is now making the acid test for the success of the process be
whether you suck up to him, whether you kiss up to him, whether
you give him the impression that you like him. If you don't and
you are someone other than Putin, you don't get respect.
This is not a good day for our country. It is a sad day
when we see this kind of disrespect. This President went to
Puerto Rico and for some reason decided that he would just toss
paper towels out to people, sort-of like being in a basketball
arena and where they throw out those small rubber balls and
people are grasping, trying to catch a rubber ball. These are
human beings. It is not a game. Why would you do such a thing?
Then to imply that Puerto Rico is not a part of our country,
that these are not citizens in some way in need of the same
respect that other citizens get.
It is a sad day for our country. I believe that if we don't
take some sort of affirmative action, show the President that
there are some guardrails, it won't get better. He seems to
take advantage of any person or entity that will not stand up
to him. We have to stand up to the President. We cannot allow
him to believe that he can do all of these things with
impunity.
Nobody sitting in that seat--we didn't ask that you send us
the top person. Send us a witness. Send someone. A clarion call
for help from Puerto Rico and the Virgin Islands, unanswered.
It is a sad day for our country. So my hope is that this
Congress will get a backbone and stand up to this President.
Political expediency is no longer the order of the day. When it
comes to helping these countries, there has to be a moral
imperative to do so.
We don't just disregard other places. Made the comment that
Puerto Rico is getting too much help. Texas didn't get too much
help. I am from Texas. We fought hard and made demands. It took
us a while, but we weren't disrespected to this extent.
So, Mr. Chairman, I thank you for allowing me to make these
comments, and I have but one question to the Representatives
from these two great, great, representing great bodies of
people, great, great places to live.
Do you believe that you are an American entitled to the
same benefits, a citizen entitled to the same benefits and
rights as other citizens?
Mr. Marrero. Yes, sir. That is my belief under the same
U.S. Constitution that applies to every corner of the island of
Puerto Rico.
Mr. Green. Ma'am.
Ms. Williams-Octalien. Yes, we do. We are proud citizens of
the United States.
Mr. Green. I am proud to be associated with you as
citizens.
I yield back the balance of my time. Thank you.
Mr. Payne. Thank you. We will just quickly want to ask one
more question, a second round to the panel, but we won't be
very long.
Mr. Currie, I understand that the GAO is currently working
on reports surrounding recovery in Puerto Rico and the USVI.
What are the biggest recovery challenges in the USVI and Puerto
Rico, if you can briefly answer that?
Mr. Currie. The biggest recovery challenges are dealing
with the obstacles to getting to the fixed-cost estimates and
agreements about permanent work projects because, until we get
to that point, we can't actually start moving forward with the
hard work of rebuilding those projects.
Mr. Payne. Thank you.
To Mr. Marrero and Ms. Williams-Octalien, I appreciate you
really appearing here before us today in your official
capacities, but I recognize that you are both survivors of
these historic hurricanes.
Putting aside your official roles, can you talk about your
experience as a survivor, and what are some of the challenges
people are still experiencing in their everyday lives and
yours?
Ms. Williams-Octalien. So, as we navigated our way through
recovery, my family was one of the last families to receive
power, and we did not get power until January. You know the
storm was in September. Just the overall challenges that we had
with keeping our food preserved.
My mother is bedridden, and the challenges were making sure
that we have electricity to operate the bed, the hospital bed,
to move her around. Even now, you know, a year and a half
later, there are concerns with the hospital. We recently had to
take her into the hospital, and I saw first-hand just the
overall challenges that we have with health care.
I stood there and I said: You know, we are responsible for
this. We are responsible for the fact that people cannot get
good health care on our island because we are unable to
navigate through the process so that we can rebuild our
hospitals.
So the recovery is real. I worked at FEMA at the time
during the storm, and, you know, everyone operated as if we
were recovered. To realize that I still didn't have power, but
every day we were out there for 12 hours, 13 hours, making sure
that other families are recovering and that we are bringing
relief to those who really need it.
So this is the first time that I would say every single
generation in the Virgin Islands understands the damage and the
hardships that storms bring, and we no longer approach just the
news that a storm is bearing down by just apathy. It is really
very concerned. We mobilize.
The other side of that, there is so much psychological
angst that is associated with the storm and overall recovery
that just the mention of it is hurricane season brings a lot of
stress. So we are really working diligently to be able to move
forward and get to recovery, because it is not really about
processes, procedures. It is really about people.
Mr. Payne. I am sure that that psychological angst is
something that really hasn't been addressed. We can't even get
the medical issues addressed, forget the psychological impact
that it has had on an entire country--territory; I am sorry.
Mr. Marrero.
Mr. Marrero. Yes, Mr. Chairman. Well, as a survivor, I had
to wait 90 days for the energy to be restored at my home. I
live in San Juan. I don't live in Vieques. I don't live in
Mayaguez or Patillas. I live in San Juan. It was almost 90
days. I had to go--as any other Puerto Rican, I had to go to a
gas station, buy gas for the generator, the emergency generator
that I have in my place.
I saw many families and friends left the island, the island
that we love and that we wanted to live until our last day. I
saw family and friends also leaving the island because they
weren't able to get the medicines that they needed for their
children. Today, we still see, as I said, 20,000 families on
their blue roof, because they were denied benefits because they
didn't have title or they live in a flood-prone area.
We still see 300,000 children. I have an 8-year-old kid who
goes to private school and have many, many activities and many
recreational time to do. Unfortunately, that is not the same
case for 300,000 children that goes to public schools today;
1,000 schools are still waiting to be repaired with no
recreational facilities. People forget all that.
But this playground area, simple as it can be for these
children, sometimes is the only recreational facility that
community will have miles by miles. Not only that, those are
the same children that they see the school as the shelter of
last resort. Those are the same children that they go to homes
with blue tarps, people that are still waiting. We have 45
percent of the people of Puerto Rico on the SNAP program. We
are talking about 1.3 million American lives that depend on
this. That is the problem.
Unfortunately, the hurricanes will hit worse to the most
vulnerable. That is a reality. Unfortunately, 2 years after
Maria, those same people are in the same vulnerable position as
they were since Day 1.
Mr. Payne. Thank you. Thank you. I will turn to the Ranking
Member of this subcommittee.
Mr. King. I have no further questions other than I am sure
Ms. Clarke would agree, in New York, even though we had a
better infrastructure and we had more resources available, our
districts are still going through recovery. So I can only
imagine what is happening in Puerto Rico and the Virgin
Islands.
Again, I thank you for your efforts, and I appreciate your
testimony here today. Thank you very much.
I yield back.
Mr. Payne. Thank you, sir. The gentleman yields back.
The Chair recognizes the gentlelady from New York, Ms.
Clarke.
Ms. Clarke. Yes, I would like to drill down a little bit on
the idea of the impact of population loss. Mr. Marrero, even
before Hurricane Maria, Puerto Rico was experiencing a
population decline. Can you discuss how Hurricane Maria
affected the pattern of out-migration and discuss how that
affects the recovery process?
Likewise, Ms. Williams-Octalien, can you tell the committee
how Hurricanes Irma and Maria has affected population migration
in the USVI, and what does that mean for the recovery process?
Mr. Marrero. Thank you, ma'am. Well, as you said, before
Hurricane Maria, we were already dealing with two man-made
hurricanes, the fiscal and economic crisis. Both crises
exacerbated the out-migration of Puerto Rico. So many Puerto
Ricans, including family members of myself, left the island for
a better quality of life. Many of them moved to Florida, to New
York and Texas, as well as many other States.
That is a reality. Obviously, when we were able to
understand the scope of the magnitude of Maria--and this was
before it slammed into Puerto Rico. I remember 48 hours before
that, many Puerto Ricans asked--the same in the USVI. Many
Puerto Ricans, they didn't understand what a hurricane was.
This was the first hurricane for many of them for many
generations.
It was a worst-case scenario. It was a worst-case scenario.
Because it was a worst-case scenario, people left the island
before the hurricane hit. People were really concerned how we
are going to be able--in the fiscal and economic situation that
we were, how we are going to be able to recover. How long will
it take for businesses to recover? How will the Government be
able to address the needs of the people? So that is the
reality.
We have lost almost 300,000 folks from Puerto Rico after
the storm. Many of them are returning. Obviously, many of them
were impeded to come back because many of the students enrolled
so they have to wait. It is really difficult to pack and go
back. But we are seeing people going back to Puerto Rico, and
that is the most opportunity that we have seen. That is the
silver lining, the great momentum, the great opportunity that
we have to rebuild Puerto Rico and the USVI in a stronger way,
in a more resilient way, and in a more intelligent way.
This is not only about disaster recovery; it is also about
economic recovery. That is why when the Congress passed the BBA
and required us to develop a disaster recovery/economic
recovery plan, we delivered, we excelled, within the time
frame, and we also made it consistent with the fiscal plan that
it would certify.
So that is the reality. We are making sure that every
opportunity that we can seize to make those transformative
changes, to make sure the people want to go back, we are doing
it. We have seen people going back. But, obviously, to the
extent that the funds are delayed, to the extent that the
recovery is delayed, also the hope of the people are delayed.
Ms. Williams-Octalien. We have had a similar experience,
maybe not to the extent of Puerto Rico, but, of course, early
on after the disaster that there are a lot of families that
really could not deal with the situations. I mean, some 120
days without power is not really what you want to put your
children through and your families. So we did see some
migration off the island.
I think the second flow of that was our businesses, where
your businesses were damaged and the employees were laid off.
We still were unable to provide employment early on. We are
seeing a resurgence of some of the families returning.
We had--let's go back to health care--where a lot of the
physicians left the island. The inability to practice. I would
say, from a personal stance, where all of our regular
practitioners left the island. So we did not have doctors
there.
So we continue to see people return. There is a lot to do.
The technical expertise, the capacity. We are really hoping
that Virgin Islanders abroad will come back to help us rebuild.
The harvest is plentiful right now, and the laborers are few.
We really want to be able to get our local Virgin Islanders
back home so we can get the territory back to what we know it
should be.
Ms. Clarke. Thank you.
Mr. Payne. Thank you.
Ms. Clarke. I yield back.
Mr. Payne. Thank you. I ask unanimous consent for
Congresswoman Stacey Plaskett's testimony for the record to be
entered into the record.
Without objection.
[The statement of Ms. Plaskett follows:]
Statement of Honorable Stacey Plaskett
July 11, 2019
Chairman Payne, Ranking Member King, and Members of the
subcommittee, I appreciate the opportunity to present a written
statement for this hearing on the recovery of my district, the U.S.
Virgin Islands.
This is very important to me. The Virgin Islands is American
territory still reeling from the devastation caused by the 2017
hurricane season, and still at early stages of working through the
process provided by law to not only recover, but to permanently
rebuild.
It is very unfortunate that despite repeated requests, months of
notice and flexibility provided to accommodate a potential witness, the
Federal Emergency Management Agency (FEMA) has chosen not to have any
representation at this hearing and not to respond to questions about
the issues and challenges that nearly 4 million Americans continue to
face with its programs.
Among the hardest places hit by Hurricanes Irma and Maria was the
Virgin Islands, where homes, possessions, and businesses along with
essential facilities like hospitals and schools were lost. We all saw
on television--many saw it personally--the walls and roofs that were
blown out of homes, apartment buildings and facilities from the force
of wind alone.
Energy systems and other vital infrastructure were completely
destroyed, leaving our communities without electricity or access to
health care and clean drinking water. Large swaths of the revenue base
necessary for normal operations collapsed.
With the level of destruction that occurred, lawmakers on both
sides of the aisle became more supportive of modifying how the Federal
Government responds to such disasters, as well as how the United States
builds and maintains infrastructure in order to mitigate against future
natural disasters.
While the Bipartisan Budget Act of 2018 provided enormous
assistance for the immediate and long-term recovery efforts; not only
in terms of funds procured, but also through special provisions put in
law for the Virgin Islands that make additional mechanisms available
for rebuilding, rather than just clean-up. For example, it allows the
Virgin Islands, along with Puerto Rico, to utilize FEMA assistance to
rebuild critical infrastructure to industry standards and more
resilient than before the hurricanes. It doesn't make sense for the
Federal Government to pay to rebuild communities after disaster back to
a standard that will only see those facilities destroyed in the next
disaster; when the Federal Government will find itself again having to
come in and build back to an original, deficient standard, as opposed
to a more resilient and more robust standard.
In addition, through passage of the Disaster Recovery Reform Act of
2018, Congress again recognized the importance of getting smarter about
how we respond after disasters, and building in resilience to minimize
loss to lives and property. The Act is a transformative modernization
of the Robert T. Stafford Disaster Relief and Emergency Assistance
Act--intended to provide more significant and regular investment in
pre-disaster mitigation activities, and to hasten recoveries in
communities impacted by disasters. It encourages communities to build
back to the most recent strongest consensus-based standards.
Finally, the most recent disaster supplemental, passed into law
last month, strengthened the resiliency provision of the Bipartisan
Budget Act of 2018 by requiring FEMA to include all pre-disaster
related costs in determining whether to repair or replace critical
infrastructure in the Virgin Islands to industry standards. The real-
life implications will be that dozens of more critical infrastructure
projects that were close to meeting the threshold for replacement under
the old rule could now be rebuilt to incorporate resilient design and
features.
Despite positive steps, much more work remains to be done,
particularly with FEMA's implementation of the programmatic changes
Congress has made. One of the most pressing outstanding issues is the
massive amounts of Federal assistance that continues to sit idle. There
is a great disparity of what has been approved and what is actually on
the ground. As you look at all of the after-action reports, from FEMA,
to GAO, and others, you see this as a constant theme.
The Virgin Islands still faces numerous challenges with FEMA's
implementation of the provisions discussed above, which the testimony
of Ms. Adrienne Williams-Octalien for this hearing, along with that of
the GAO, articulates in detail.
FEMA's treatment of the insular areas of the United States is of
great concern to me because it continues to hold back the full and
resilient recovery of the Virgin Islands. As the GAO testimony
discusses, at times, the appropriate process for implementing
resiliency provisions was not clear, and therefore ensuring program
participants understood its key components was difficult. In addition,
numerous critical infrastructure projects are on hold pending FEMA
guidance.
Given the current fiscal state of the Virgin Islands following the
hurricanes, FEMA guidance and assistance in seeing the fixed-cost
estimates required for projects to receive additional resiliency
assistance are as accurate as possible will be critical.
Most egregiously, FEMA continues to refuse to exercise its
statutory discretion under the Insular Areas Act to waive local cost-
sharing requirements on debris removal, emergency protective measures,
and permanent infrastructure repair--forcing the Virgin Islands to
divert precious little funds that it needs to use for community
development and the rebuilding of the energy grid.
It is the Federal Government that under-funds the territories to
begin with, putting arbitrary caps on our access to Federal safety net
programs, and persistently under-funds them in terms of infrastructure
costs and in other areas. Then, when a disaster strikes, and the
territories are unable to meet those costs, it becomes a question of
why the territories aren't being responsible. That is fundamentally
unfair to these Americans. To date, the Virgin Islands has received far
less than what was requested in 2017.
As we execute our rebuilding and our long-term recovery, we must do
so cognizant of other long-standing challenges specific to the insular
areas. While we have made significant strides and will continue to do
so, we must continue to confront the difficult reality that the island
territories of the United States, and their U.S. citizen residents,
have been neglected and allowed to fall behind.
Thank you for considering this testimony and for your support of
your fellow Americans in the Virgin Islands.
Mr. Payne. I want to thank the witnesses for their valuable
testimony and the Members for their questions. The Members of
the subcommittee may have additional questions for the
witnesses, and we ask that you respond expeditiously in writing
to those questions.
Pursuant to committee rule VII(D), the hearing will be held
open for 10 days.
Without objection.
Hearing no further business of the subcommittee, it stands
adjourned. Thank you.
[Whereupon, at 11:26 a.m., the subcommittee was adjourned.]
A P P E N D I X
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Question From Chairman Bennie G. Thompson for Chris P. Currie
Question. Mr. Currie, the June 12 hearing, where you were also a
witness, FEMA's Acting Administrator Peter Gaynor testified before the
Committee on Homeland Security that FEMA was short ``a few thousand''
workers. How does this shortage impact current recovery efforts in the
territories?
Answer. FEMA's workforce shortages hamper the agency's ability to
respond to future hurricanes and other disasters, particularly because
of FEMA's massive workload and unprecedented demand for FEMA staffing
following the 2017 and 2018 disasters. The agency's workforce
challenges specifically affect recovery efforts in Puerto Rico and the
U.S. Virgin Islands in two ways. First, maintaining and deploying a
sufficient and adequately-trained FEMA workforce is critical to
recovery efforts after any disaster, in any location. We have
previously reported on FEMA's long-standing workforce management
challenges in this area. In our June 2019 testimony,\1\ we reported our
preliminary observations from our on-going review of FEMA's workforce
capacity and training efforts during the 2017 and 2018 disaster
seasons. Specifically, we reported challenges in FEMA's ability to
deploy staff with the right kinds of skills and training at the right
time to best meet the needs of various disasters. According to FEMA
field leadership we interviewed, for some of the functions FEMA
performs in the field, FEMA had too few staff with the right technical
skills to perform their missions--such as inspections of damaged
properties--efficiently and effectively. For example, FEMA staff in
Puerto Rico stated that there has been a shortage of experienced staff
to support the agency's Public Assistance and Hazard Mitigation
programs, which provide funding to repair damaged public
infrastructure, such as hospitals and schools, and take actions to
reduce future losses. Staff said this has hampered the agency's ability
to inspect damaged properties and process program applications.
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\1\ GAO, Emergency Management: FEMA Has Made Progress, but
Challenges and Future Risks Highlight Imperative for Further
Improvements, GAO-19-594T (Washington, DC: June 12, 2019).
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Second, recovery efforts depend on effective implementation of
FEMA's Public Assistance program, among other assistance programs.
However, in our July 2019 testimony,\2\ we reported challenges in
implementing this program in Puerto Rico and the U.S. Virgin Islands.
Specifically, our prior and on-going work identified challenges related
to: (1) The clarity of FEMA's guidance for the Public Assistance
program, (2) the time and resources needed to transition to FEMA's new
Public Assistance program delivery model in Puerto Rico, (3) the
implementation of flexibilities provided by the Bipartisan Budget Act
of 2018,\3\ and (4) developing fixed-cost estimates under the Public
Assistance alternative procedures. Ensuring that FEMA identifies the
necessary staff with the right technical skills to address
implementation challenges with the Public Assistance program will be
key to the recovery of Puerto Rico and the U.S. Virgin Islands. We will
continue to evaluate these identified challenges and any efforts to
address them, and plan to report our findings in late 2019 and early
2020.
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\2\ GAO, Emergency Management: FEMA's Disaster Recovery Efforts in
Puerto Rico and the U.S. Virgin Islands, GAO-19-662T (Washington, DC:
July 11, 2019).
\3\ See Pub. L. No. 115-123, 1A 20601, 132 Stat. 64, 85 (2018).
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